EXHIBIT 16(12)
SULLIVAN & WORCESTER LLP
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JUNE 21, 2006
Large Cap Core Equity Fund
Value Plus Fund
Touchstone Strategic Trust
303 Broadway, Suite 1100
Cincinnati, Ohio 45202
Re: Acquisition of Assets of Value Plus Fund by Large Cap Core Equity Fund
Ladies and Gentlemen:
You have asked for our opinion as to certain Federal income tax
consequences of the transaction described below.
Parties to the Transaction
Value Plus Fund ("Target Fund") is a series of Touchstone Strategic Trust,
a Massachusetts business trust (the "Trust").
Large Cap Core Equity Fund ("Acquiring Fund") is also a series of the
Trust.
Description of Proposed Transaction
In the proposed transaction (the "Reorganization"), Acquiring Fund will
acquire all of the assets of Target Fund in exchange for shares of Acquiring
Fund of equivalent value and assumption of any liabilities of Target Fund, and
Target Fund will then dissolve and distribute all of the Acquiring Fund shares
which it holds to its shareholders pro rata in proportion to their shareholdings
in Target Fund, in complete redemption of all outstanding shares of Target Fund.
Scope of Review and Assumptions
In rendering our opinion, we have reviewed and relied upon the form of
Agreement and Plan of Reorganization between Acquiring Fund and Target Fund
effective as of May 18, 2006 (the "Reorganization Agreement") which is enclosed
in a prospectus/proxy statement, filed with the United States Securities and
Exchange Commission on or about May 25, 2006, registration number 333-134486,
which describes the proposed transactions, and on the information provided in
such prospectus/proxy statement. We have relied, without independent
verification, upon the factual statements made therein, and assume that there
will be no change in material facts disclosed therein between the date of this
letter and the date of the closing of the transaction. We further assume that
the transaction will be carried out in accordance with the Reorganization
Agreement.
Representations
Written representations, copies of which are attached hereto, have been
made to us by the appropriate officers of Target Fund and Acquiring Fund, and we
have without independent verification relied upon such representations in
rendering our opinions.
Opinions
Based on and subject to the foregoing, and our examination of the legal
authority we have deemed to be relevant, we have the following opinions:
1. The transfer of all of the assets of Target Fund in exchange for shares
of Acquiring Fund and assumption of any liabilities of Target Fund followed by
the distribution of said Acquiring Fund shares to the shareholders of Target
Fund in dissolution and liquidation of Target Fund will constitute a
reorganization within the meaning of ss. 368(a) of the Internal Revenue Code of
1986, as amended (the "Code"), and Acquiring Fund and Target Fund will each be
"a party to a reorganization" within the meaning of ss. 368(b) of the Code.
2. No gain or loss will be recognized by Acquiring Fund upon the receipt
of the assets of Target Fund solely in exchange for Acquiring Fund shares and
assumption of any liabilities of Target Fund.
3. No gain or loss will be recognized by Target Fund upon the transfer of
its assets to Acquiring Fund in exchange for Acquiring Fund shares and
assumption of any liabilities of Target Fund, or upon the distribution (whether
actual or constructive) of such Acquiring Fund shares to the shareholders of
Target Fund in exchange for their Target Fund shares.
4. The shareholders of Target Fund will recognize no gain or loss upon the
exchange of their Target Fund shares for Acquiring Fund shares in liquidation of
Target Fund.
5. The aggregate tax basis of the Acquiring Fund shares received by each
Target Fund shareholder pursuant to the Reorganization will be the same as the
aggregate tax basis of the Target Fund shares held by such shareholder
immediately prior to the Reorganization.
6. The holding period of the Acquiring Fund shares received by each Target
Fund shareholder will include the period during which the Target Fund shares
exchanged therefor were held by such shareholder, provided the Target Fund
shares were held as a capital asset on the date of the Reorganization.
7. The tax basis of the assets of Target Fund acquired by Acquiring Fund
will be the same as the tax basis of those assets in the hands of Target Fund
immediately prior to the Reorganization, and the holding period of the assets of
Target Fund in the hands of Acquiring Fund will include the period during which
those assets were held by Target Fund.
8. Acquiring Fund will succeed to and take into account the items of
Target Fund described in Section 381(c) of the Code, subject to the conditions
and limitations specified in Sections 381, 382, 383 and 384 of the Code and
applicable regulations thereunder.
The foregoing opinions are based on the Code as in effect on the date
hereof and administrative and judicial interpretations of it. No assurance can
be given that the Code will not change or that such interpretations will not be
revised or amended adversely, possibly with retroactive effect. This opinion
letter is delivered to you in satisfaction of the requirements of Section 8.6 of
the Reorganization Agreement. We hereby consent to the filing of this opinion as
an exhibit to the Registration Statement on Form N-14 relating to the
Reorganization and to use of our name and any reference to our firm in such
Registration Statement or in the prospectus/proxy statement constituting a part
thereof. In giving such consent, we do not thereby admit that we come within the
category of persons whose consent is required under Section 7 of the Securities
Act of 1933, as amended, or the rules and regulations of the Securities and
Exchange Commission thereunder.
Very truly yours,
/s/ SULLIVAN & WORCESTER LLP
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SULLIVAN & WORCESTER LLP