EXHIBIT 8
, 2001
Drovers Bancshares Corporation Fulton Financial Corporation
30 South George Street One Penn Square
York, PA 17401 Lancaster, PA 17604
Re: Merger of Drovers Bancshares Corporation
with and into Fulton Financial Corporation
Gentlemen:
We have acted as counsel to Fulton Financial Corporation ("FFC") in
connection with the Agreement and Plan of Merger dated December 27, 2000 (the
"Merger Agreement") between FFC and Drovers Bancshares Corporation ("DBC").
The following transactions will occur pursuant to the Merger Agreement:
(i.) DBC will be merged with and into FFC, with FFC surviving the merger
(the "Merger");
(ii.) Each issued and outstanding share of the common stock of DBC, no
par value per share ("DBC Common Stock"), will be converted into
1.24 shares of the common stock of FFC, par value $2.50 per share
(the "FFC Common Stock").
You have requested our opinion as to certain federal income tax
consequences of the transactions contemplated by the Merger Agreement, and this
opinion is rendered pursuant to the provisions of Section 7.1(d) of Article VII
of the Merger Agreement.
This Opinion Letter is governed by, and shall be interpreted in accordance
with, the Legal Opinion Accord (the "Accord") of the American Bar Association's
Section of Business Law (1991), as supplemented or modified by the Pennsylvania
Third-Party Legal Opinion Supplement (the "Pennsylvania Supplement") of the
Pennsylvania Bar Association's Section of Corporation, Banking and Business Law
(1992). As a consequence, this Opinion Letter is subject to a number of
qualifications, exceptions, definitions, limitations on coverage and other
limitations, all as more particularly described in the Accord and the
Pennsylvania Supplement, and this Opinion Letter shall be read in conjunction
therewith. The law covered by the opinions expressed herein is limited to the
federal law of the United States of America.
Except as otherwise indicated herein, capitalized terms used in this
Opinion Letter are defined and set forth in the Merger Agreement, the Accord or
the Pennsylvania Supplement. Our opinions herein are subject to the following
conditions and assumptions, in addition to those set forth in the Accord and the
Pennsylvania Supplement:
(A) All of the shares of DBC Common Stock that are issued and
outstanding at the time of the Merger will be duly authorized,
validly issued, fully paid and nonassessable.
(B) All conditions precedent to the obligations of FFC and DBC as set
forth in the Merger Agreement will have been satisfied at the time
of the Merger.
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(C) All covenants required to be performed by FFC and DBC on or before
the date of consummation of the Merger, as set forth in the Merger
Agreement, will have been performed by them as of such date.
(D) The transaction contemplated by the Merger Agreement, including
without limitation the Merger and the issuance of shares of FFC
Common Stock to the stockholders of DBC, will be accomplished in
strict accordance with the terms of the Merger Agreement.
(E) The fair market value of the FFC Common Stock and the other
consideration received by each DBC shareholder will be
approximately equal to the fair market value of the DBC Common
Stock surrendered in the exchange.
(F) Upon consummation of the Merger, the former stockholders of DBC
will own, in the aggregate, FFC Common Stock equal in value to at
least 50 percent of the value of all of the formerly outstanding
DBC Common Stock as of the date of the Merger.
(G) There is no plan or intention on the part of the shareholders of
DBC who own, individually or collectively, five percent or more of
the DBC Common Stock, to sell or otherwise transfer to FFC or any
person related to FFC (within the meaning of Reg. Sec. 1.368-1-
1(e)(3) a number of shares of FFC Common Stock to be received
pursuant to the Merger Agreement that would reduce the ownership of
FFC Common Stock by former stockholders of DBC to a number of
shares of the FFC Common Stock having, in the aggregate, a value of
less than 50 percent of the value of all DBC Common Stock
outstanding immediately prior to the Merger. For purposes of this
assumption, shares of DBC Common Stock exchanged for cash or other
property, surrendered by dissenters, or exchanged for cash in lieu
of fractional shares of FFC Common Stock will be treated as
outstanding DBC Common Stock on the date of the transaction.
Moreover, shares of FFC Common Stock and shares of DBC Common Stock
sold, redeemed, or disposed of prior or subsequent to the
transaction will be considered in making this assumption.
(H) There is no plan or intention on the part of FFC to reacquire any
of the shares of FFC Common Stock issued pursuant to the provisions
of the Merger Agreement.
(I) There is no plan or intention on the part of FFC to sell or
otherwise dispose of any of the assets of DBC acquired in the
Merger, except for the dispositions made in the ordinary course of
business or transfers described in Section 368(a)(2)(C) of the
Internal Revenue Code of 1986, as amended (the "Code").
(J) The liabilities of DBC assumed by FFC and the liabilities to which
the assets of DBC are subject were incurred by DBC in the ordinary
course of DBC business.
(K) Following the Merger, FFC will continue the historic business of
DBC or will use a significant portion of DBC's historic business
assets in a business.
(L) FFC, DBC and stockholders of DBC will pay their respective
expenses, if any, incurred in connection with the Merger.
(M) There is no intercorporate indebtedness existing between FFC and
DBC that was issued or acquired or that will be settled at a
discount.
(N) No two parties to the Merger are investment companies as defined in
Section 368(a)(2)(F) of the Code.
(O) DBC is not under the jurisdiction of a court in a Title 11 or
similar case within the meaning of Section 368(a)(3)(A) of the
Code.
(P) The fair market value of the assets of DBC transferred to FFC will
equal or exceed the sum of the liabilities assumed by FFC plus the
amount of liabilities, if any, to which the transferred assets are
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subject.
Based upon and subject to the foregoing, we are of the opinion that:
(1) The Merger will constitute a reorganization within the meaning of
Section 368(a)(1)(A) of the Code.
(2) No gain or loss will be recognized by DBC or FFC by reason of the
Merger.
(3) The bases of the assets of DBC in the hands of FFC will be the same
as the bases of such assets in the hands of DBC immediately prior
to the Merger.
(4) The holding period of the assets of DBC in the hands of FFC
following the Merger will include the period during which such
assets were held by DBC prior the Merger.
(5) No gain or loss will be recognized by the DBC shareholders on the
exchange of shares of DBC Common Stock solely for shares of FFC
Common Stock, except for that income, gain or loss which is
recognized due to the receipt of cash which is received in lieu of
the issuance of fractional shares of FFC Common Stock. The receipt
of cash by DBC shareholders will have the effect of treating the
shareholders as having received solely shares of FFC Common Stock
in the reorganization exchange and then having received a cash
payment from FFC in a hypothetical redemption of that number of
shares of FFC Common Stock equal in value to such cash payment. The
DBC shareholder who receives cash will therefore recognize capital
gain or loss on the constructive redemption of such shares in an
amount equal to the difference between the cash received and the
adjusted basis in such shares.
(6) The basis of the shares of FFC Common Stock received by DBC
shareholders will be the same as the basis of the shares of DBC
Common Stock exchanged therefor (decreased by any amount allocable
to fractional share interests for which cash is received).
(7) The holding period of the shares of FFC Common Stock received by
the shareholders of DBC will include the period during which DBC
shareholders held the shares of DBC Common Stock surrendered,
provided the shares of DBC Common Stock are held as a capital asset
on the date of the exchange.
Very truly yours,
Barley, Snyder, Senft & Cohen, LLC
By:________________________
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