EXHIBIT 8.1
August __, 1998
Mr. Richard M. Adams
United Bankshares, Inc.
514 Market Street
Post Office Box 1508
Parkersburg, West Virginia 26102-1508
Dear Mr. Adams:
You have requested our opinion on certain federal income tax
consequences relating to the merger of Fed One Bancorp, Inc. ("Fed One") with
and into UBC Holding Company, Inc. ("UBC"), a wholly-owned subsidiary of United
Bankshares, Inc. ("United").
The relevant facts concerning the mergers are set forth in the
Agreement and Plan of Merger dated as of February 18, 1998, executed by the
above parties. A description of the transaction set forth therein (the
"Transaction") is incorporated herein by reference. We have assumed with your
consent that: (i) the merger will be effected in accordance with the Agreement
and Plan of Merger, and will qualify under applicable law, and (ii) the
representations contained in the letters from United and Fed One were true and
correct at all relevant times.
REPRESENTATIONS
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In addition to the general statement of facts set forth in the
Registration Statement, and exhibits attached thereto, that the parties to the
Transaction have made the following representations concerning the proposed
merger of Fed One with and into UBC:
(1) The merger will constitute a valid statutory merger under
the applicable laws of West Virginia and Delaware.
(2) The fair market value of United common stock and other
consideration received by each Fed One shareholder will be approximately equal
to the fair market value of the Fed One common stock surrendered in the
exchange.
(3) There is no plan or intention by the shareholders of Fed
One who own 5% or more of the Fed One common stock, and, to the best of the
knowledge of the management of United and Fed One, there is no plan or intention
on the part of the remaining Fed One shareholders to sell, exchange or otherwise
dispose of a number of shares of United common stock received in the Transaction
that would reduce the Fed One shareholders' ownership of United common stock to
a number of shares having a value, as of the date of the transaction, of less
than 50% of the value of all of the formerly outstanding common stock of Fed One
as of the same date. For purposes of this representation, shares of Fed One
common stock exchanged for cash or other property, if any, or exchanged for cash
in lieu of fractional shares of United common stock will be treated as
outstanding Fed One common stock on the date of the transaction. Moreover,
shares of Fed One common stock
Mr. Richard M. Adams
August __, 1998
Page 2
and shares of United common stock held by Fed One shareholders and otherwise
sold, redeemed or disposed of prior or subsequent to the Transaction will be
considered stock exchanged pursuant to the Transaction.
(4) UBC will acquire at least 90% of the fair market value of
the net assets and at least 70% of the fair market value of the gross assets
held by Fed One immediately prior to the Transaction. For purposes of this
representation, amounts paid by Fed One to shareholders who receive cash or
other property, Fed One assets used by Fed One to pay reorganization expenses,
and all redemptions and distributions (except for regular, normal dividends)
made by Fed One immediately preceding the transfer, will be included as assets
of Fed One immediately prior to the Transaction.
(5) Prior to the transaction, United will be in control of UBC
within the meaning of Section 368(c) of the Internal Revenue Code.
(6) Following the Transaction, UBC will not issue additional
shares of its stock that would result in United losing control of UBC within the
meaning of Section 368(c) of the Internal Revenue Code.
(7) United has no plan or intention to liquidate UBC; to merge
UBC with and into another corporation; to sell of otherwise dispose of the stock
of UBC; or to cause UBC to sell or otherwise dispose of any of the assets of Fed
One acquired in the Transaction, except for dispositions made in the ordinary
course of business or transfers described in Section 368(a)(2)(C) of the
Internal Revenue Code.
(8) Following the Transaction, UBC will continue the historic
business of Fed One or use a significant portion of Fed One's business assets in
a business.
(9) United has no plan or intention to reacquire any of its
stock issued in the merger.
(10) The liabilities of Fed One assumed by UBC and the
liabilities to which the transferred assets of Fed One are subject were incurred
by Fed One in the ordinary course of business.
(11) There is no intercorporate indebtedness existing between
United and Fed One or between UBC and Fed One that was issued, acquired or will
be settled at a discount.
(12) Fed One is not under the jurisdiction of a Court in a
Title 11 or similar case within the meaning of Section 368(a)(3)(A).
Mr. Richard M. Adams
August __, 1998
Page 3
(13) The fair market value of the assets of Fed One
transferred to UBC will equal or exceed the sum of the liabilities assumed by
UBC, if any, plus the amount of liabilities, if any, to which the transferred
assets are subject.
(14) United, UBC, Fed One, and any shareholder thereof will
pay their respective expenses, if any, incurred in connection with the merger.
(15) No party to the Transaction is an investment company, as
defined in I.R.C. Section 368(a)(2)(F)(iii) and (iv).
(16) No stock of UBC will be issued in the transaction.
(17) The payment of cash to Fed One shareholders in lieu of
fractional shares of United common stock is not separately bargained for
consideration and is solely for the purpose of saving United the expense and
inconvenience of issuing fractional shares. The total cash consideration that
will be paid in the merger to the Fed One shareholders instead of issuing
fractional shares of United common stock will not exceed 1% of the total
consideration to be issued in the transaction to Fed One shareholders in
exchange for their shares of Fed One common stock. The fractional share
interests of each Fed One shareholder will be aggregated and no Fed One
shareholder will receive cash for fractional shares in an amount equal to or
greater than the value of one full share of United common stock.
(18) None of the compensation received by any
shareholder-employees of Fed One will be separate consideration for, or
allocable to, any of their shares of Fed One stock; none of the shares of United
Common Stock received by any shareholder-employees will be separate
consideration for, or allocable to, any employment agreement; and the
compensation paid to any shareholder-employees will be for services actually
rendered and will be commensurate with amounts paid to third parties bargaining
at arm's-length for similar services.
OPINION
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Based solely upon the information submitted and on the
representations set forth above, we are of the opinion that:
(a) The statutory merger of Fed One with and into UBC will
constitute tax-free reorganizations within the meaning of I.R.C. ss. 368;
Mr. Richard M. Adams
August __, 1998
Page 4
(b) No gain or loss should be recognized by United or UBC as a
result of the consummation of the merger;
(c) No gain or loss should be recognized by a United
Stockholder who receives shares of United Common Stock in exchange for shares of
Fed One Common Stock, except as described below with respect to a United
Stockholder who receives cash in lieu of a fractional share interest in United
Common Stock;
(d) The aggregate adjusted tax basis of shares of United
Common Stock (including a fractional share interest in United Common Stock
deemed received and redeemed as described below) received by a United
Stockholder should be the same as the aggregate adjusted tax basis of the shares
of Fed One Common Stock exchanged therefor;
(e) The holding period of shares of United Common Stock
(including a fractional share interest in United Common Stock deemed received
and redeemed as described below) received by a U. S. Holder should include the
holding period of the Fed One Common Stock exchanged therefor, provided such
shares of Fed One Common Stock were held as capital assets at the Effective
Time; and
(f) A United Stockholder who received cash in lieu of a
fractional share interest in United Common Stock should be treated as having
received such fractional share interest and then as having received the cash in
redemption of such fractional share interest. Under Section 302 of the Code, if
such deemed distribution were "substantially disproportionate" with respect to
the United Stockholder or were "not essentially equivalent to a dividend" after
giving effect to the constructive ownership rules of the Code, the United
Stockholder would generally recognize capital gain or loss equal to the
difference between the amount of cash received and the United Stockholder's
adjusted tax basis in the fractional share interest (determined as described in
(d) above).
It should be noted that the opinions expressed in this letter
are based upon statutory, judicial and administrative authority as of the date
of this opinion. There can be no assurance that such authority will not be
changed in the future, or that such changes will not be made retroactively
applicable to the transactions considered herein. Moreover, the above-stated
opinions are based upon the facts as we understand them and upon the
representations provided to us. If the facts turn out to be different in any
material respect from the facts or representations stated herein, or if the laws
or regulations applicable to the proposed transactions are changed or
reinterpreted by competent tribunals, some or all of the opinions expressed in
this letter may become inapplicable.
Mr. Richard M. Adams
August __, 1998
Page 5
Please note further that Treas. Reg. ss. 1.368-3 requires
certain records to be kept and information to be filed with the federal income
tax returns of each corporation which is a party to the reorganization.
We hereby consent to the filing of this opinion with the
Securities and Exchange Commission as an Exhibit to the Registration Statement
on Form S-4 and any Amendment thereto (the "Registration Statement") in respect
to the shares of United common stock to be issued in connection with the merger,
and to the reference to this opinion under the caption "The Merger Certain
Federal Income Tax Consequences" and elsewhere in the Prospectus/Joint Proxy
Statement included therein. In giving such consent, we do not hereby admit that
we are in the category of persons whose consent is required under Section 7 of
the Securities Act of 1933, as amended.
Sincerely,
BOWLES RICE McDAVID GRAFF & LOVE
By __________________
Marc A. Monteleone
Its Member