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EXHIBIT 8.2
[VINSON & ELKINS L.L.P. LETTERHEAD]
June 26, 1997
Parker & Parsley Petroleum Company
303 W. Wall
Suite 101
Midland, Texas 79701
Gentlemen:
We have acted as counsel to Parker & Parsley Petroleum Company ("Parker &
Parsley") in connection with (a) the planned merger (the "Reincorporation
Merger") of MESA, Inc. ("Mesa") with and into Pioneer Natural Resources Company
("Pioneer"), and (b) the planned merger (the "Parker & Parsley Merger") of
Parker & Parsley with and into MOC Operating Co., a wholly owned subsidiary of
Mesa ("MOC"), pursuant to an Amended and Restated Agreement and Plan of Merger
dated as of April 6, 1997 (the "Merger Agreement"). Defined terms used in the
Merger Agreement have the same meanings when used herein, unless otherwise
defined herein.
In rendering this opinion, we have examined and are relying upon
(without any independent investigation or review thereof) the truth and
accuracy at all relevant times of the statements, and representations, and the
performance or satisfaction as appropriate, of the covenants, contained in (i)
the Merger Agreement (including all disclosure schedules thereto), (ii) the
Joint Proxy Statement/Prospectus (which was included in Registration No.
333-26951, as amended, filed jointly by Parker & Parsley and Mesa with the
Securities and Exchange Commission (the "Registration Statement")), (iii)
certain of the MXP SEC Documents and Spice SEC Documents (each as defined in
the Merger Agreement), and (iv) the officers' certificates dated June 26,
1997 which were provided to us by each of Mesa and Parker & Parsley. In
addition, we assume that the Reincorporation Merger and the Parker & Parsley
Merger (collectively the "Mergers") will be consummated in accordance with the
Merger Agreement and as described in the Joint Proxy Statement/Prospectus. Any
inaccuracy in any of the aforementioned statements and representations, or
breach or failure of any of the aforementioned covenants, could adversely
affect our opinion.
On the basis of the foregoing and subject to the limitations set forth
below, it is our opinion that, under presently applicable federal income tax
law, the Parker & Parsley Merger and the Reincorporation Merger will each be
treated as a reorganization within the meaning of section 368(a)
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of the Internal Revenue Code of 1986, as amended (the "Code"). As a result,
the following U.S. federal income tax consequences will occur:
(a) No gain or loss will be recognized by Parker & Parsley as
a result of the merger of Parker & Parsley with and into MOC.
(b) No gain or loss will be recognized by holders of Parker &
Parsley Common Stock solely by reason of their receipt, in the Parker &
Parsley Merger, of Pioneer Common Stock in exchange therefor.
(c) The tax basis of the shares of Pioneer Common Stock
received by a Parker & Parsley stockholder in the Parker & Parsley
Merger (including any fractional share not actually received) will be
the same as the tax basis of the Parker & Parsley Common Stock
surrendered in exchange therefor.
(d) The holding period of the shares of Pioneer Common Stock
received by a Parker & Parsley stockholder in the Parker & Parsley
Merger will include the holding period of the shares of Parker & Parsley
Common Stock surrendered in exchange therefor, provided that such shares
of Parker & Parsley Common Stock are held as capital assets at the
Effective Time.
(e) A cash payment in lieu of a fractional share will be
treated as if a fractional share of Pioneer Common Stock had been
received in the Parker & Parsley Merger and then redeemed by Pioneer.
Such redemption should qualify as a distribution in full payment in
exchange for the fractional share rather than as a distribution of a
dividend. Accordingly, a Parker & Parsley stockholder receiving cash in
lieu of a fractional share will recognize gain or loss upon such payment
in an amount equal to the difference, if any, between such stockholder's
basis in the fractional share (as described in paragraph (c) above) and
the amount of cash received. Such gain or loss will be a capital gain
or loss if the Parker & Parsley Common Stock is held as a capital asset
at the Effective Time.
(f) A cash payment received as a result of an exercise of
dissenters' rights of appraisal will give rise to the recognition of
taxable gain or loss, as the case may be, equal to the difference
between the amount of cash received and the basis of the Parker &
Parsley Common Stock for which the cash is deemed to be payment. Such
gain or loss will be capital gain or loss if the Parker & Parsley Common
Stock is held as a capital asset at the Effective Time.
(g) No gain or loss will be recognized by Mesa as a result of
the merger of Mesa with and into Pioneer.
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(h) No gain or loss will be recognized by holders of Mesa
Common Stock solely by reason of their receipt, in the Reincorporation
Merger, of Pioneer Common Stock in exchange therefor.
(i) The tax basis of the shares of Pioneer Common Stock
received by a holder of Mesa Common Stock in the Reincorporation Merger
(including any fractional share not actually received) will be the same
as the tax basis of the Mesa Common Stock surrendered in exchange
therefor.
(j) The holding period of the shares of Pioneer Common Stock
received by a holder of Mesa Common Stock in the Reincorporation Merger
will include the holding period of the shares of Mesa Common Stock
surrendered in exchange therefor, provided that such shares of Mesa
Common Stock are held as capital assets at the Effective Time.
(k) No gain or loss will be recognized by holders of Mesa
Series A Preferred Stock solely by reason of their receipt, in the
Reincorporation Merger, of Pioneer Common Stock or Pioneer Preferred
Stock in exchange therefor, except to the extent that Pioneer Common
Stock or Pioneer Preferred Stock is received in exchange for accrued and
unpaid dividends (if any) on the Mesa Series A Preferred Stock.
(l) The tax basis of the shares of Pioneer Common Stock or
Pioneer Preferred Stock received by a holder of Mesa Series A Preferred
Stock in the Reincorporation Merger (including any fractional share not
actually received) will be the same as the tax basis of the Mesa Series
A Preferred Stock surrendered in exchange therefor.
(m) The holding period of the shares of Pioneer Common Stock
or Pioneer Preferred Stock received by a holder of Mesa Series A
Preferred Stock in the Reincorporation Merger will include the holding
period of the shares of Mesa Series A Preferred Stock surrendered in
exchange therefor, provided that such shares of Mesa Series A Preferred
Stock are held as capital assets at the Effective Time.
(n) No gain or loss will be recognized by holders of Mesa
Series B Preferred Stock solely by reason of their receipt in the
Reincorporation Merger of Pioneer Common Stock or Pioneer Preferred
Stock in exchange therefor, except to the extent that Pioneer Common
Stock or Pioneer Preferred Stock is received in exchange for accrued and
unpaid dividends (if any) on the Mesa Series B Preferred Stock.
(o) The tax basis of the shares of Pioneer Common Stock or
Pioneer Preferred Stock received by a holder of Mesa Series B Preferred
Stock in the Reincorporation Merger (including any fractional share not
actually received) will be the same as the tax basis of the Mesa Series
B Preferred Stock surrendered in exchange therefor.
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(p) The holding period of the shares of Pioneer Common Stock
or Pioneer Preferred Stock received by a holder of Mesa Series B
Preferred Stock in the Reincorporation Merger will include the holding
period of the shares of Mesa Series B Preferred Stock surrendered in
exchange therefor, provided that such shares of Mesa Series B Preferred
Stock are held as capital assets at the Effective Time.
(q) A cash payment in lieu of a fractional share will be
treated as if a fractional share of Pioneer Common Stock or Pioneer
Preferred Stock, as the case may be, had been received in the
Reincorporation Merger and then redeemed by Pioneer. Such redemption
should qualify as a distribution in full payment in exchange for the
fractional share rather than as a distribution of a dividend.
Accordingly, a Mesa stockholder receiving cash in lieu of a fractional
share will recognize gain or loss upon such payment in an amount equal
to the difference, if any, between such stockholder's basis in the
fractional share (as described in paragraph (i), (l), or (o), as the
case may be, above) and the amount of cash received. Such gain or loss
will be a capital gain or loss if the stock surrendered is held as a
capital asset at the Effective Time.
Our opinion is based on our interpretation of the Code, applicable
Treasury regulations, judicial authority, and administrative rulings and
practice, all as in effect as of the date hereof. There can be no assurance
that future legislative, judicial or administrative changes or interpretations
will not adversely affect the accuracy or applicability of the conclusions set
forth herein. We do not undertake to advise you as to any such future changes
or interpretations unless we are specifically retained to do so. Our opinion
will not be binding upon the Internal Revenue Service (the "IRS") or the
courts, and neither will be precluded from adopting a contrary position.
If the IRS successfully challenged the status of the Parker & Parsley
Merger as a reorganization within the meaning of Section 368(a) of the Code, a
Parker & Parsley stockholder would recognize gain or loss in an amount equal to
the difference between the stockholder's tax basis in his or her shares of
Parker & Parsley Common Stock and the fair market value, as of the Effective
Time, of Pioneer Common Stock received in exchange therefor. In such event,
the stockholder's tax basis in Pioneer Common Stock so received would be equal
to its fair market value as of the Effective Time, and the holding period for
such stock would begin on the day after the Effective Time.
Similarly, if the IRS successfully challenged the status of the
Reincorporation Merger as a reorganization within the meaning of Section 368(a)
of the Code, a Mesa stockholder would recognize gain or loss in an amount equal
to the difference between the stockholder's tax basis in his or her shares of
Mesa Common Stock, Mesa Series A Preferred Stock, or Mesa Series B Preferred
Stock, as the case may be, and the fair market value, as of the Effective Time,
of Pioneer Common Stock or Pioneer Preferred Stock received in exchange
therefor. In such event, the stockholder's tax basis in Pioneer Common Stock
or Pioneer Preferred Stock so received would be
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equal to its fair market value as of the Effective Time, and the holding period
for such stock would begin on the day after the Effective Time.
No opinion is expressed as to any matter not specifically addressed
above, including, without limitation, the tax consequences of the Mergers under
any foreign, state, or local tax law. Moreover, tax consequences which are
different from or in addition to those described herein may apply to Parker &
Parsley stockholders or Mesa stockholders who are subject to special treatment
under the U.S. federal income tax laws, such as persons who acquired their
shares in compensatory transactions in exchange for services rendered, and
persons who have a contingent right to receive additional Parker & Parsley or
Mesa stock as a result of contingency or earn-out provisions in prior
acquisitions by Parker & Parsley or Mesa. Such persons are advised to consult
their own tax advisors with specific reference to their particular
circumstances.
We hereby consent to the filing of this opinion as an exhibit to the
Registration Statement. This opinion is being delivered to you solely for that
purpose.
Very truly yours,
/s/ Vinson & Elkins L.L.P.
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