MALIZIA, SPIDI, SLOANE & FISCH, P.C.
ATTORNEYS AT LAW
1301 K STREET, N.W.
SUITE 700 EAST
WASHINGTON, D.C. 20005
(202) 434-4660
FACSIMILE: (202) 434-4661
WRITER'S DIRECT DIAL NUMBER
February 3, 1999
Board of Directors
First Federal Florida
205 East Orange Street
Lakeland, Florida 33801-4611
Dear Board Members:
In accordance with your request, set forth herein is the opinion of
this firm regarding the material federal income tax consequences of the proposed
reorganization of First Federal Florida (the "Bank") from a federally chartered
mutual savings association into the mutual holding company form, the formation
of the Bank as the stock savings association successor to its mutual form (the
"Reorganization") pursuant to the Plan of Mutual Holding Company Reorganization
and Stock Issuance adopted by the Board of Directors of the Bank (the "Plan of
Reorganization"), and the proposed sale of FloridaFirst Bancorp's ("Stock
Holding Company") common stock pursuant to the Plan of Reorganization. The
Reorganization and its component and related transactions are described in the
Plan of Reorganization. As used in this letter, "Mutual Bank" refers to the Bank
before the Reorganization and "Stock Bank" refers to the Bank after the
Reorganization. All other capitalized terms used but not defined in this letter
shall have the meanings assigned to them in the Plan of Reorganization.
The Reorganization will be effected, pursuant to the Plan of
Reorganization, as follows: (i) Mutual Bank will organize an interim federal
stock savings association as its wholly-owned subsidiary ("Interim One") and
(ii) Interim One will organize an interim federal stock savings association as
its wholly-owned subsidiary ("Interim Two") and the Stock Holding Company. The
following transactions will then occur simultaneously: (iii) Mutual Bank will
exchange its charter for a federal stock savings association charter and thereby
become Stock Bank (the "Conversion"); (iv) Interim One will cancel its
outstanding stock and exchange its charter for a federal mutual holding company
charter and thereby become the "Mutual Holding Company;" (v) Interim Two will
merge with and into Stock Bank with Stock Bank being the surviving institution
and (vi) the initially issued shares of common stock of Stock Bank (which will
be constructively received by former Mutual Bank members when Mutual Bank
becomes Stock Bank pursuant to step (iii)) will be issued to the Mutual Holding
Company in exchange for membership interests in the Mutual Holding Company (the
"Exchange"). As a result of these transactions, (a) Stock Bank will be a
wholly-owned subsidiary of the Mutual Holding Company and (b) the former members
of Mutual Bank will own membership interests in the Mutual Holding Company. The
Mutual Holding Company will then contribute 100% of Stock Bank's common stock to
the Stock Holding Company.
Board of Directors
February 3, 1999
Page 2
Simultaneously with the Reorganization, the Stock Holding Company will
offer to sell shares of its common stock pursuant to the Plan of Reorganization,
with priority subscription rights granted in descending order to certain members
in Mutual Bank, to certain employee stock benefit plans of Mutual Bank, to other
members of Mutual Bank, and to certain members of the general public.
In connection with the opinion expressed herein, we have examined and
relied upon originals, or copies certified or otherwise identified to our
satisfaction, of the Plan of Reorganization, the Prospectus, and of such
corporate records of the parties to the Reorganization as we have deemed
appropriate. We have assumed that the parties to the Reorganization will act in
accordance with the Plan of Reorganization. In addition, we have made such
investigations of law as we have deemed appropriate to form a basis for the
opinion expressed below.
Based on and subject to the foregoing, it is our opinion that for
federal income tax purposes, under current law -
(a) With regard to the Conversion:
(1) the Conversion will constitute a reorganization under section
368(a)(1)(F) of the Internal Revenue Code of 1986, as amended (the "Code"), and
the Bank (in either its status as Mutual Bank or Stock Bank) will recognize no
gain or loss as a result of the Conversion;
(2) The basis of each asset of Mutual Bank held by Stock Bank
immediately after the Conversion will be the same as Mutual Bank's basis for
such asset immediately prior to the Conversion;
(3) the holding period of each asset of Mutual Bank held by Stock Bank
immediately after the Conversion will include the period during which such asset
was held by Mutual Bank prior to the Conversion;
(4) for purposes of Code section 381(b), Stock Bank will be treated as
if there had been no reorganization and, accordingly, the taxable year of the
Mutual Bank will not end on the effective date of the Conversion and the tax
attributes of Mutual Bank (subject to application of Code sections 381, 382 and
384), including Mutual Bank's bad debt reserves and earnings and profits, will
be taken into account by Stock Bank as if the Conversion had not occurred;
(5) Mutual Bank's members will recognize no gain or loss upon their
constructive receipt of shares of Stock Bank common stock, pursuant to the
Conversion, solely in exchange for their interest (i.e., liquidation and voting
rights) in Mutual Bank; and
(6) no gain or loss will be recognized by members of Mutual Bank upon
the issuance to them of deposits in Stock Bank in the same dollar amount and
upon the same terms as their deposits in Mutual Bank.
(b) With regard to the Exchange:
(7) the Exchange will qualify as an exchange of property for stock
under Code section 351;
(8) the initial shareholders of Stock Bank (the former Mutual Bank
members) will recognize no gain or loss upon the constructive transfer to the
Mutual Holding Company of the shares of Stock Bank common stock they
constructively received in the Conversion in exchange for mutual interests
(i.e., liquidation and voting rights) in the Mutual Holding Company; and
(9) the Mutual Holding Company will recognize no gain or loss upon its
receipt from the shareholders of Stock Bank of shares of Stock Bank common stock
in exchange for interests in the Mutual Holding Company.
(c) With regard to the Mutual Holding Company's transfer of 100% of the
common stock of Stock Bank to Stock Holding Company:
(10) the Stock Holding Company will recognize no gain or loss upon its
receipt of 100% of the common stock of Stock Bank from the Mutual Holding
Company; and
(11) the Mutual Holding Company will recognize no gain or loss upon its
transfer of 100% of the common stock of Stock Bank to the Stock Holding Company.
This opinion is given solely for the benefit of the parties to the Plan
of Reorganization, the shareholders of Stock Bank and Eligible Account Holders,
Supplemental Eligible Account Holders and other investors who purchase pursuant
to the Plan of Reorganization, and may not be relied upon by any other party or
entity or referred to in any document without our express written consent. We
consent to the filing of this opinion as an exhibit to (a) Registration
Statement on Form S-1 to be filed with the SEC, and (b) the Form MHC-1 to be
filed with the Office of Thrift Supervision, and to the references to this firm
in the Stock Holding Company's Prospectus related to the common stock offering
described in the Plan of Reorganization.
Very truly yours,
/s/Malizia, Spidi, Sloane & Fisch, P.C.
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MALIZIA, SPIDI, SLOANE & FISCH, P.C.