EXHIBIT 5.2
[LETTERHEAD OF BROWN & WOOD LLP]
January 5, 1997
Merrill Lynch & Co., Inc.
World Financial Center
North Tower
New York, New York 10281
Merrill Lynch Preferred Funding Merrill Lynch Preferred Funding
III, L.P . IV, L.P.
World Financial Center World Financial Center
North Tower North Tower
New York, New York 10281 New York, New York 10281
Merrill Lynch Preferred Capital Merrill Lynch Preferred Capital
Trust III Trust IV
World Financial Center World Financial Center
North Tower North Tower
New York, New York 10281 New York, New York 10281
Re: Merrill Lynch Preferred Capital Trust III and IV Trust
Originated Preferred Securities ("TOPrS")
Ladies and Gentlemen:
We have acted as tax counsel ("Tax Counsel") to Merrill Lynch & Co.,
Inc., a Delaware corporation ("Company"), Merrill Lynch Preferred Funding III,
L.P. and Merrill Lynch Preferred Funding IV, L.P., limited partnerships formed
under the Delaware Revised Uniform Limited Partnership Act, as amended
("Partnerships"), and Merrill Lynch Preferred Capital Trust III and Merrill
Lynch Preferred Capital Trust IV, statutory business trusts formed under the
Delaware Business Trust Act, as amended ("Trusts"), in connection with the
preparation and filing by Company, Partnerships and Trusts with the Securities
and Exchange Commission ("Commission") of a Registration Statement on Form S-3
(Registration No. 333-42859) (as amended, "Registration Statement") under the
Securities Act of 1933, as amended, and with respect to: (i) the issuance and
sale of subordinated debentures ("Company Subordinated Debentures") by Company
pursuant to a form of Indenture ("Company Indenture"), between Company and The
Chase Manhattan Bank, a New York banking corporation, as trustee ("Indenture
Trustee") in the form filed as an
exhibit to the Registration Statement; (ii) the issuance and sale of one or
more debentures (each a "Guaranteed Investment Affiliate Debenture",
collectively "Investment Affiliate Debentures") by one or more eligible
controlled affiliates of Company (each an "Investment Affiliate"), pursuant to
forms of Indenture (each an "Investment Affiliate Indenture"), from each such
Investment Affiliate and Company to Indenture Trustee (Company Subordinated
Debenture and Investment Affiliate Debentures are collectively referred to
hereinafter as the "Debentures" and the forms of Company Indenture and the
Investment Affiliate Indentures are collectively referred to hereinafter as
the "Indentures"), each of which is guaranteed by Company pursuant to a form
of Affiliate Debenture Guarantee Agreement in the form filed as an exhibit to
the Registration Statement; (iii) the issuance and sale of Partnership
Preferred Securities by Partnerships to Trusts pursuant to the Amended and
Restated Agreement of Limited Partnership ("Partnership Agreement") in the
form filed as an exhibit to the Registration Statement; and (iv) the issuance
and sale of Trust Preferred Securities and Trust Common Securities
(collectively, "Trust Securities") pursuant to Trusts' Amended and Restated
Declaration of Trust ("Declaration") in the form filed as an exhibit to the
Registration Statement. The Trust Preferred Securities will be offered for
sale to investors pursuant to the Registration Statement.
All capitalized terms used in this opinion letter and not otherwise
defined herein shall have the meaning ascribed to such terms in the
Registration Statement.
In delivering this opinion letter, we have reviewed and relied upon:
(i) the Registration Statement; (ii) forms of the Indentures; (iii) forms of
the Debentures; (iv) the forms of the Partnership Agreement; (v) the forms of
the Declaration; (vi) the forms of (A) the Partnership Guarantee Agreements,
(B) the Trust Preferred Securities Guarantee Agreements, (C) the Trust Common
Securities Guarantee Agreements and (D) the Affiliate Debenture Guarantee
Agreements, each filed as exhibits to the Registration Statement; and (vii) the
forms of (A) the Partnership Preferred Securities and (B) the Trust
Securities, each filed as exhibits to the Registration Statement. In
addition, we have examined, and relied as to matters of fact upon, certain
certificates and comparable documents of Company and certain eligible
controlled affiliates of Company, from which Company will select Investment
Affiliates. Further, we have relied upon certain other statements and
representations made by officers of Company. We also have examined and relied
upon original or copies, certified or otherwise identified to our
satisfaction, of such records of Company, Partnerships and Trusts and such
other documents, certificates and records as we have deemed necessary or
appropriate as a basis for the opinions set forth herein.
In our examination of such material, 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 documents
submitted to us. In addition, we also have assumed (i) that the transactions
related to the issuance of the Debentures, Partnership Preferred Securities
and Trust Securities will be consummated in accordance with the terms
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of the documents and forms of documents described herein and (ii) on the
closing date, an Independent Financial Advisor will deliver the opinion
required under Section 7.1(b) of the Partnership Agreements.
On the basis of the foregoing and assuming that Partnerships and
Trusts were formed and will be maintained in compliance with the terms of the
Partnership Agreements and the Declarations, respectively, we hereby confirm (i)
our opinions set forth in the Registration Statement under the caption
"Certain Federal Income Tax Considerations" and (ii) that, subject to the
qualifications set forth therein, the discussion set forth in the Registration
Statement under such caption is an accurate summary of the United States
federal income tax matters described therein.
We express no opinion with respect to the transactions referred to
herein or in the Registration Statement other than as expressly set forth
herein. Moreover, we note that there is no authority directly on point
dealing with securities such as the Trust Preferred Securities or transactions
of the type described herein and that our opinions are not binding on the
Internal Revenue Service ("IRS") or the courts, either of which could take a
contrary position. Nevertheless, we believe that if challenged, the opinions
we express herein would be sustained by a court with jurisdiction in a
properly presented case.
Our opinions are based upon the Code, the Treasury regulations
promulgated thereunder and other relevant authorities and law, all as in
effect on the date hereof. Consequently, future changes in the law may cause
the tax treatment of the transactions referred to herein to be materially
different from that described above.
The opinions we express herein are limited solely to matters
governed by the federal income tax laws of the United States.
We hereby consent to the use of this opinion for filing as Exhibit
5.2 to the Registration Statement and the use of our name in the Registration
Statement under the captions "Certain Federal Income Tax Considerations" and
"Legal Matters".
Very truly yours,
/s/ Brown & Wood LLP
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