Exhibit 12
___, 2004
Federated Municipal Securities Income Trust, on behalf of its portfolio,
Federated Michigan Intermediate Municipal Trust
5800 Corporate Drive
Pittsburgh, Pennsylvania 15237
Golden Oak(R)Family of Funds, on behalf of its portfolio,
Golden Oak(R) Michigan Tax Free Bond Portfolio
5800 Corporate Drive
Pittsburgh, Pennsylvania 15237
Ladies and Gentlemen:
You have requested our opinion concerning certain federal income tax
consequences of a transaction (the "Reorganization") in which all of the assets
of Golden Oak(R) Michigan Tax Free Bond Portfolio (the "Acquired Fund"), a
portfolio of the Golden Oak(R) Family of Funds, a Delaware statutory trust (the
"Golden Oak(R) Trust"), will be acquired by Federated Municipal Securities
Income Trust, a Massachusetts business trust (the "Federated Trust"), on behalf
of its portfolio, Federated Michigan Intermediate Municipal Trust (the
"Acquiring Fund"), in exchange solely for shares of the Acquiring Fund (the
"Acquiring Fund Shares"), which shall thereafter be distributed to the holders
of the Class A Shares and Institutional Shares of the Acquired Fund (the
"Acquired Fund Shareholders"), in liquidation of the Acquired Fund. Both the
Federated Trust and the Golden Oak(R) Trust are registered open-end management
investment companies which qualify as regulated investment companies described
in Section 851(a) of the Internal Revenue Code of 1986, as amended (the "Code").
The terms and conditions of the Reorganization are set forth in an Agreement and
Plan of Reorganization dated as of __, 2004, between the Federated Trust and the
Golden Oak(R) Trust (the "Agreement"). This opinion is rendered to you pursuant
to paragraph 8.5 of the Agreement.
We have reviewed and relied upon the Registration Statement on Form N-14
(the "Registration Statement") filed with the Securities and Exchange Commission
(the "Commission") in connection with the Reorganization, the certificates
provided to us by the Federated Trust and the Golden Oak(R) Trust in connection
with the rendering of this opinion, and such other documents and instruments as
we have deemed necessary for the purposes of this opinion.
Based upon and subject to the foregoing, and assuming that the
Reorganization will take place as described in the Agreement, we are of the
opinion that, for federal income tax purposes:
(a) The Acquired Fund's transfer of all of its assets to the Acquiring Fund
solely in exchange for Acquiring Fund Shares and the distribution of the
Acquiring Fund Shares to the Acquired Fund Shareholders in liquidation of
the Acquired Fund will constitute a "reorganization" within the meaning of
Section 368(a) of the Code, and the Acquiring Fund and the Acquired Fund
each will be "a party to a reorganization" within the meaning of Section
368(b) of the Code;
(b) No gain or loss will be recognized by the Acquiring Fund upon the receipt
of the assets of the Acquired Fund solely in exchange for the Acquiring
Fund Shares;
(c) No gain or loss will be recognized by the Acquired Fund upon the transfer
of its assets to the Acquiring Fund solely in exchange for the Acquiring
Fund Shares or upon the distribution (whether actual or constructive) of
the Acquiring Fund Shares to the Acquired Fund Shareholders in exchange for
their shares of stock in the Acquired Fund (the "Acquired Fund Shares");
(d) No gain or loss will be recognized by any Acquired Fund Shareholder upon
the exchange of its Acquired Fund Shares for Acquiring Fund Shares;
(e) The tax basis of the assets of the Acquired Fund acquired by the Acquiring
Fund will be the same as the tax basis of such assets to the Acquired Fund
immediately prior to the Reorganization;
(f) The aggregate tax basis of the Acquiring Fund Shares received by each
Acquired Fund Shareholder pursuant to the Reorganization will be the same
as the aggregate tax basis of the Acquired Fund Shares held by it
immediately prior to the Reorganization;
(g) The holding period of the assets of the Acquired Fund in the hands of the
Acquiring Fund will include the period during which such assets were held
by the Acquired Fund; and
(h) The holding period of the Acquiring Fund Shares received by each Acquired
Fund Shareholder pursuant to the Reorganization will include the period
during which it held the Acquired Fund Shares exchanged therefor (provided
the Acquired Fund Shares were held as capital assets on the date of the
Reorganization).
Notwithstanding anything herein to the contrary, we express no opinion as
to the effect of the Reorganization on the Acquiring Fund, the Acquired Fund or
any Acquired Fund Shareholder with respect to any asset as to which unrealized
gain or loss is required to be recognized for federal income tax purposes at the
end of a taxable year (or on the termination or transfer thereof) under a
mark-to-market system of accounting.
This opinion is expressed as of the date hereof and is based upon the Code,
Treasury regulations promulgated thereunder, administrative positions of the
Internal Revenue Service (the "Service"), and judicial decisions, all of which
are subject to change either prospectively or retroactively. There can be no
assurance that changes in the law will not take place which could affect the
opinions expressed herein or that contrary positions may not be taken by the
Service. We disclaim any undertaking to advise you with respect to any event
subsequent to the date hereof.
The opinions contained herein are limited to those matters expressly
covered; no opinion is to be implied in respect of any other matter. This
opinion is addressed solely to you and may not be relied upon by any other
person without our prior written consent. We hereby consent to the filing of a
copy of this opinion with the Commission as an exhibit to the Registration
Statement.
Very truly yours,