EXHIBIT 8.1
February 10, 1998
America First Mortgage Investments, Inc.
1004 Farnham Street
Omaha, Nebraska 68102
Re: PROPOSED MERGER AND REIT STATUS
Ladies and Gentlemen:
You have requested our opinion with respect to certain federal income tax
matters in connection with the transactions contemplated by the Merger Agreement
dated as of July 29, 1997 (the "Merger Agreement"), among America First
Participating/Preferred Equity Mortgage Fund Limited Partnership ("Prep Fund
1"), America First Prep Fund 2 Limited Partnership ("Prep Fund 2"), America
First Prep Fund 2 Pension Series Limited Partnership ("Pension Fund"),
(collectively, the "Partnerships"), America First Mortgage Investments, Inc.
(the "Company"), and A.F. Merger, L.P. ("Partnership Merger Sub"). The
transactions include the merger of Prep Fund 1 and Prep Fund 2 into the Company,
and the merger of Partnership Merger Sub into Pension Fund (collectively, the
"Merger"). As a result of the Merger, the holders ("Unitholders") of units of
Prep Fund 1 ("Prep Fund 1 Units"), Beneficial Unit Certificates of Prep Fund 2
("Prep Fund 2 BUCs") and Beneficial Unit Certificates of Pension Fund ("Pension
BUCs" and, together with the Prep Fund 1 Units and the Prep Fund 2 BUCs,
"Units"), other than Pension BUC Unitholders electing the Retention Option, will
terminate their interests in the Partnerships and receive shares of Common Stock
in the Company. All capitalized terms used herein have their respective
meanings set forth in the Merger Agreement unless otherwise stated.
In rendering the opinion stated below, we have examined and relied, with
your consent, upon the following:
The Merger Agreement;
The Prospectus/Consent Solicitation Statement, dated February 10, 1998
(the "Prospectus/Consent Solicitation Statement");
The Amended and Restated Agreements of Limited Partnership of the
Partnerships, (collectively, the "Partnership Agreements"); and
such other documents, records and instruments as we have deemed
necessary in order to enable us to render the opinion referred to in
this letter.
In our examination of the foregoing documents, we have assumed, with your
consent, that (i) all documents reviewed by us are original documents, or true
and accurate copies of original documents, and
have not been subsequently amended, (ii) the signatures of each original
document are genuine, (iii) each party who executed the document had proper
authority and capacity, (iv) all representations and statements set forth in
such documents are true and correct, (v) all obligations imposed by any such
documents on the parties thereto have been or will be performed or satisfied in
accordance with their terms and (vi) the Company, Prep Fund 1, Prep Fund 2 and
Pension Fund have at all times been and the Company and Pension Fund will at all
times continue to be organized and operated in accordance with the terms of such
documents. We have further assumed, with your consent, the accuracy of the
statements and descriptions of the Company's and Pension Fund's intended
activities as described in the Merger Agreement, the Prospectus/Consent
Solicitation Statement and the Partnership Agreements, and that the Company and
Pension Fund have operated and will continue to operate in accordance with the
method of operation described in the Merger Agreement, the Prospectus/Consent
Solicitation Statement and the Partnership Agreements.
For purposes of rendering the opinions stated below, we have further
assumed, with your consent, the accuracy of the representations contained in the
Certificate of Representations dated February 10, 1998 provided to us by the
Company (the "Company Certificate"). These representations generally relate to
the qualification of the Company as a REIT for federal income tax purposes and
the qualification of the Merger as a tax-free transfer for federal income tax
purposes. For purposes of rendering the opinions stated below, we have also
assumed, with your consent, the accuracy of the representations contained in the
Certificate of Representations dated February 10, 1998 provided to us by the
Partnerships (the "Partnership Certificate"). These representations generally
relate to the qualification of the Merger as a tax-free transfer for federal
income tax purposes and to the organization and operation of Prep Fund 1, Prep
Fund 2, and Pension Fund.
Based upon and subject to the foregoing, we are of the opinion that:
(i) the Merger will be treated for federal income tax purposes as a
transfer of assets by Prep Fund 1 and Prep Fund 2 and a transfer of Pension
BUCs by the Unitholders of Pension BUCs for shares of Common Stock
qualifying for treatment under Section 351 of the Code followed by a tax-
free distribution of such Common Stock by Prep Fund 1 and Prep Fund 2 to
their Unitholders;
(ii) commencing with its taxable year ending December 31, 1998, the Company
will be organized and operated in conformity with the requirements for
qualification and taxation as a REIT within the meaning of Sections 856
through 860 of the Internal Revenue Code of 1986, as amended (the "Code")
and the Company's proposed method of operation will permit the Company to
continue to so qualify; and
(iii) the discussion contained in the Prospectus/Consent Solicitation
Statement under the heading "Federal Income Tax Considerations" fairly
summarizes the material federal income tax considerations associated with
the Merger and the operation of the Company.
The opinions stated above represent our conclusions as to the application
of federal income tax laws existing as of the date of this letter to the
transactions contemplated in the Merger Agreement and the Prospectus/Consent
Solicitation Statement and we can give no assurance that legislative enactments,
administrative changes or court decisions may not be forthcoming that would
modify or supersede our opinion. An opinion of counsel merely represents
counsel's judgement with respect to the probable outcome on the merits and is
not binding on the Internal Revenue Service ("IRS") or the courts. It should be
noted that some of the tax consequences of the Merger are subject to differing
interpretations and that the opinions stated above are based upon a conclusion
that the Merger will not be treated as a transfer to an investment company under
Section 351(e) of the Code. However, neither the courts nor the IRS has ruled
on the application of Section 351(e) in connection with an exchange of
partnership units for shares or a transaction similar to the Merger.
Accordingly, there can be no assurance that positions contrary to our opinion
will not be taken by the IRS, or that a court considering the issues would not
hold contrary to such opinion.
The opinions set forth above represent our conclusions based upon the
documents, facts and representations referred to above. Any material amendments
to such documents, changes in any significant facts or inaccuracy of such
representations could affect the opinions referred to herein. Moreover, the
Company's qualification and taxation as a REIT depend upon the Company's ability
to meet, through actual annual operating results, requirements under the Code
regarding income, assets, distributions and diversity of stock ownership.
Because the Company's satisfaction of these requirements will depend on future
events, no assurance can be given that the actual results of the Company's
operations for any one taxable year will satisfy the tests necessary to qualify
as or be taxed as a REIT under the Code. Although we have made such inquiries
and performed such investigations as we have deemed necessary to fulfill our
professional responsibilities as counsel, we have not undertaken an independent
investigation of all of the facts referred to in this letter, the Partnership
Certificate and the Company Certificate.
The opinions set forth in this letter: (i) are limited to those matters
expressly covered; no opinion is to be implied in respect of any other
matter;(ii) are as of the date hereof; and (iii) may not be relied on by any
other person or entity other than you or your stockholders without our prior
written consent.
We hereby consent to the filing of this opinion letter as an exhibit to
the Company's Registration Statement on Form S-4 and the reference to this
firm under the caption "Federal Income Tax Considerations" in the
Prospectus/Consent Solicitation Statement.
Very truly yours,
/s/ Roger & Wells LLP