[ROPES AND GRAY LETTERHEAD]
September 30, 2002
Xxxxxx Voyager Fund II
The Xxxxxx Funds
Xxx Xxxx Xxxxxx Xxxxxx
Xxxxxx, Xxxxxxxxxxxxx 00000
Xxxxxx Technology Fund
Xxxxxx Funds Trust
The Xxxxxx Funds
Xxx Xxxx Xxxxxx Xxxxxx
Xxxxxx, Xxxxxxxxxxxxx 00000
Ladies and Gentlemen:
We have acted as counsel in connection with the Agreement and Plan of
Reorganization made as of May 2, 2002, as amended by a Letter Agreement
dated September 30, 2002 (the "Agreement"), by and among Xxxxxx Voyager
Fund II, a Massachusetts business trust (the "Acquiring Fund"), Xxxxxx
Funds Trust, a Massachusetts business trust (the "Target Trust"), on
behalf of one of its series, Xxxxxx Technology Fund (the "Target Fund"),
and Xxxxxx Investment Management, LLC, a Delaware limited liability
company and the investment manager to each Fund. The Agreement
describes a proposed transaction (the "Transaction") to occur on
September 30, 2002 (the "Closing Date"), pursuant to which Acquiring
Fund will acquire substantially all of the assets of Target Fund in
exchange for shares of beneficial interest in Acquiring Fund (the
"Acquiring Fund Shares") and the assumption by Acquiring Fund of certain
stated liabilities of Target Fund, following which, Acquiring Fund
Shares received by Target Fund will be distributed by Target Fund to its
shareholders in liquidation and termination of Target Fund. Capitalized
terms not defined herein are defined in the Agreement.
Target Fund is a series of the Target Trust, which is registered under
the Investment Company Act of 1940, as amended (the "1940 Act") as an
open-end management investment company. Shares of Target Fund are
redeemable at net asset value at each shareholder's option. Target Fund
has elected to be a regulated investment company for federal income tax
purposes under Section 851 of the Internal Revenue Code of 1986, as
amended (the "Code").
Acquiring Fund is registered under the 1940 Act as an open-end
management investment company. Shares of Acquiring Fund are redeemable
at net asset value at each shareholder's option. Acquiring Fund has
elected to be a regulated investment company for federal income tax
purposes under Section 851 of the Code.
For purposes of this opinion, we have considered the Agreement, the
Target Fund proxy statement, and such other items as we have deemed
necessary to render this opinion. In addition, you provided us with a
letter dated as of the date hereof, representing as to certain facts,
occurrences and information upon which you have indicated that we may
rely in rendering this opinion (whether or not contained or reflected in
the documents and items referred to above) (the "Representations").
Based on the foregoing Representations and our review of the documents
and items referred to above, we are of the opinion that for federal
income tax purposes:
(i) The Transaction will constitute a reorganization within the meaning
of Section 368(a) of the Code, and Acquiring Fund and Target Fund will
each be a "party to a reorganization" within the meaning of Section
368(b) of the Code;
(ii) No gain or loss will be recognized by Target Fund upon the transfer
of Target Fund's assets to Acquiring Fund in exchange for Acquiring Fund
Shares and the assumption by Acquiring Fund of the liabilities of Target
Fund, or upon the distribution of Acquiring Fund Shares by Target Fund
to its shareholders in liquidation;
(iii) No gain or loss will be recognized by Target Fund shareholders
upon the exchange of their Target Fund Shares for Acquiring Fund Shares;
(iv) The aggregate basis of Acquiring Fund Shares that a Target Fund
shareholder receives in connection with the Transaction will be the same
as the aggregate basis of his or her Target Fund Shares exchanged
therefor;
(v) A Target Fund shareholder's holding period for his or her Acquiring
Fund Shares will be determined by including the period for which he or
she held the Target Fund Shares exchanged therefor, provided that he or
she held such Target Fund Shares as capital assets;
(vi) No gain or loss will be recognized by Acquiring Fund upon the
receipt of the assets of Target Fund in exchange for Acquiring Fund
Shares and the assumption by Acquiring Fund of the liabilities of Target
Fund;
(vii) The basis in the hands of Acquiring Fund of the assets of Target
Fund transferred to Acquiring Fund in the Transaction will be the same
as the basis of such assets in the hands of Target Fund immediately
prior to the transfer;
(viii) The holding periods of the assets of Target Fund in the hands of
Acquiring Fund will include the periods during which such assets were
held by Target Fund; and
(ix) Acquiring Fund will succeed to and take into account the items of
Target Fund described in Section 381(c) of the Code, subject to the
conditions and limitations specified in Sections 381, 382, 383, 384 of
the Code and the Regulations thereunder.
Our opinion is based on the Internal Revenue Code of 1986, as amended,
Treasury Regulations, Internal Revenue Service rulings, judicial
decisions, and other applicable authority, all as in effect on the date
of this opinion. The legal authorities on which this opinion is based
may be changed at any time. Any such changes may be retroactively
applied and could modify the opinion expressed above.
Very truly yours,
/s/ Ropes & Xxxx
Ropes & Xxxx
