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EXHIBIT 8.1
[JONES & KELLER, P.C. LETTERHEAD]
January 20, 1999
First Western Corp. FW Capital I
11210 Huron Street c/o First Western Corp.
Northglenn, Colorado 802334 11210 Huron Street
Northglenn, Colorado 80234
Re: Opinion of Counsel Related to the Material Federal Income Tax
Consequences of the Purchase and Ownership of Preferred Securities
Issued by FW Capital I
Ladies and Gentlemen:
We have acted as special counsel to First Western Corp. (the "Company")
in connection with the preparation and filing with the Securities and Exchange
Commission under the Securities Act of 1933, as amended (the "Act"), of a Form
SB-2 Registration Statement, dated on or about November 13, 1998 (the
"Registration Statement"). The Registration Statement relates to the offer for
sale of up to 2,300,000 ____% Cumulative Preferred Securities (the "Preferred
Securities") of FW Capital I ("FW Capital"), a statutory business trust formed
by the Company under the laws of the State of Delaware, and the Junior
Subordinated Debentures to be issued by the Company to FW Capital in connection
with the sale of the Preferred Securities.
This opinion letter relates to the material federal income tax
consequences of the purchase and ownership of the Preferred Securities by
investors. All capitalized terms used in this opinion letter and not otherwise
defined herein are used as described in the Registration Statement. The
consequences described herein are not applicable to investors who may be subject
to special tax treatment, such as banks, real estate investment trusts,
regulated investment companies, insurance companies, dealers in securities or
currencies, tax-exempt investors, non-United States Persons or persons that will
hold the Preferred Securities as part of a position in a "straddle" or as part
of a "hedging" or other integrated transaction. In addition, this opinion does
not include any description of any alternative minimum tax consequences or the
tax laws of any state, local or foreign government that may be applicable to an
investor.
We have examined the Registration Statement and such other documents as
we have deemed necessary to render our opinion expressed below. In our
examination of such material, we have relied upon the current and continued
accuracy of the factual matters we have considered, and we have assumed the
genuineness of all signatures, the authenticity of all documents submitted to us
as originals and the conformity to original documents of all copies of
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First Western Corp.
FW Capital I
January 20, 1999
documents submitted to us. In addition, we also have assumed that the
transactions related to the issuance of the Junior Subordinated Debentures and
the Preferred Securities will be consummated in accordance with the terms and
forms of the documents. As to any facts material to the opinions expressed
herein which were not independently established or verified, we have relied upon
oral or written statements and representations of officers, trustees, and other
representatives of the Company, FW Capital and others. Should any of the above
facts, circumstances, or assumptions be subsequently determined incorrect or
inaccurate, our conclusions may vary from those set forth below and such
variance could be material.
Based on the foregoing, and assuming that FW Capital was formed and
will be maintained in compliance with the terms of the Trust Agreement it is our
opinion that:
(1) FW Capital will be classified for United States federal income tax
purposes as a grantor trust and not as an association taxable as a corporation
for United States federal income tax purposes, and as a result, each beneficial
owner of Preferred Securities will be treated as owning an undivided beneficial
interest in the Junior Subordinated Debentures.
(2) The Junior Subordinated Debentures will be classified for United
States federal income tax purposes as indebtedness. Provided the election to
defer interest payments is deemed a remote contingency, stated interest on the
Junior Subordinated Debentures generally will be included in income by a
Securityholder at the time such interest income is paid or accrued in accordance
with the Securityholder's regular method of tax accounting. No opinion is
expressed whether the election to defer will be deemed a remote contingency.
(3) Gain or loss generally will be recognized by a Securityholder on a
sale of Preferred Securities (including a redemption for cash) in an amount
equal to the difference between the amount realized (which for this purpose,
will exclude amounts attributable to accrued interest or original issue discount
not previously included in income) and the Securityholder's adjusted tax basis
in the Preferred Securities sold or so redeemed. Gain or loss recognized by the
Securityholder on Preferred Securities will generally be taxable as capital gain
or loss. Amounts attributable to accrued interest will be taxable as ordinary
income. However, because there is conflicting authority regarding the need for
inclusion of interest income (and the corresponding exclusion of such interest
from the amount realized) for a cash basis Securityholder if the Preferred
Securities are sold for less than their principal amount, no opinion is
expressed regarding the need for inclusion in such an event.
(4) We confirm that the discussion contained in the portion of the
Registration Statement titled "Material Federal Income Tax Consequences" sets
forth the material United States federal income tax consequences that may be
relevant to the purchase and ownership of the Preferred Securities.
This opinion is based upon the Internal Revenue Code of 1986, as
amended, the Treasury regulations promulgated thereunder and other relevant
authorities and law, all as in effect on the date hereof. All of the above are
subject to change or modification by subsequent legislative, regulatory,
administrative or judicial decisions which could adversely affect our opinions.
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First Western Corp.
FW Capital I
January 20, 1999
Consequently, future changes in the law, or administrative or judicial
interpretations thereof, may cause the tax treatment of the transactions
referred to herein to be materially different from that described above.
Other than the specific tax opinions set forth in this letter, no other
opinion has been rendered with respect to the tax treatment of the proposed
issuance and sale of the Junior Subordinated Debentures or the Preferred
Securities, including, but not limited to, the tax treatment of the proposed
transactions under other provisions of the Code and the regulations, the tax
treatment of any conditions existing at the time of, or effects resulting from,
the proposed transactions that are not specifically covered by the above
opinions, or the tax treatment of the proposed transactions under state, local,
foreign or any other tax laws.
We hereby consent to the filing of this letter as an exhibit to the
Registration Statement and the use of our name in the Registration Statement
under the captions "Certain Federal Income Tax Consequences" and "Legal
Matters."
Very truly yours,
/s/ Jones & Keller, P.C.
JONES & KELLER, P.C.