1
EXHIBIT 8.1
SIDLEY & AUSTIN
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Telephone (▇▇▇) ▇▇▇-▇▇▇▇
Facsimile (▇▇▇) ▇▇▇-▇▇▇▇
August 26, 1999
Ocwen Financial Corporation
▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇
Ladies and Gentlemen:
We refer to the Agreement of Merger dated as of July 25, 1999 (the
"Agreement") among Ocwen Financial Corporation, a Florida corporation
("Purchaser"), Ocwen Asset Investment Corp., a Virginia corporation ("Ocwen"),
and Ocwen Acquisition Company ("Sub"), a Virginia corporation and subsidiary of
Ocwen Properties, Inc., a New York corporation and direct subsidiary of
Investors Mortgage Insurance Holding Company, a Delaware corporation and direct
subsidiary of Purchaser, which provides for the merger (the "Merger") of Sub
with and into Ocwen, with Ocwen as the surviving corporation and the common
shareholders of Ocwen becoming shareholders of Purchaser, all on the terms and
conditions therein set forth, the time at which the Merger becomes effective
being hereinafter referred to as the "Effective Time." Capitalized terms used
but not defined herein have the meanings specified in the Agreement.
As provided in the Agreement, at the Effective Time, by reason of the
Merger: (i) each then issued and outstanding common share of Ocwen ("Ocwen
Common Shares") shall be converted into the right to receive 0.71 validly
issued, fully paid and nonassessable shares of common stock of Purchaser
("Purchaser Common Shares"), with cash paid in lieu of fractional shares of
Purchaser Common Shares (the "Merger Consideration"); and (ii) all Ocwen Common
Shares that are held in the treasury of Ocwen or by any wholly-owned Ocwen
Subsidiary and any Ocwen Common Shares owned by Purchaser or by any wholly-owned
Purchaser Subsidiary shall be cancelled and no capital stock of Purchaser or
other consideration shall be delivered in exchange therefor. All such Ocwen
Common Shares, when so converted, shall no longer be outstanding and shall
automatically be cancelled and retired and all rights with respect thereto shall
cease to exist, and each holder of any such Ocwen Common Shares shall cease to
have any rights with respect thereto, except the right to receive the Merger
Consideration and, if a holder of Ocwen Common Shares on the record date for the
1998 REIT Dividend, the 1998 REIT Dividend, in each case, without interest and
less any required withholding taxes.
The Merger and the Agreement are more fully described in Purchaser's
Registration Statement on Form S-4, as amended (the "Registration Statement"),
relating to the registration of Purchaser Common Shares and to which this
opinion is an exhibit, which has been filed by Purchaser with the Securities and
Exchange Commission pursuant to the Securities Act of 1933, as amended. The
Registration Statement includes the Joint Proxy Statement/Prospectus (the
"Prospectus") of Purchaser and Ocwen.
2
Ocwen Financial Corporation
August 26, 1999
Page 2
In rendering the opinion expressed below, we have relied upon the accuracy
of the facts, information and representations and the completeness of the
covenants contained in the Agreement, the Registration Statement, the Prospectus
and such other documents as we have deemed relevant and necessary (including,
without limitation, those described above). Such opinion is conditioned, among
other things, not only upon such accuracy and completeness as of the date
hereof, but also the continuing accuracy and completeness thereof as of the
Effective Time. Moreover, we have assumed the absence of any change to any of
such documents between the date thereof and the Effective Time.
We have assumed the authenticity of all documents submitted to us as
originals, the genuineness of all signatures, the legal capacity of all natural
persons and the conformity with original documents of all copies submitted to us
for our examination. We have further assumed that the transactions related to
the Merger or contemplated by the Agreement will be consummated (i) in
accordance with the Agreement and (ii) as described in the Prospectus.
In rendering the opinion expressed below, we have considered the applicable
provisions of the Internal Revenue Code of 1986, as amended (the "Code"),
regulations promulgated thereunder by the United States Treasury Department (the
"Regulations"), pertinent judicial authorities, rulings and interpretations of
the Internal Revenue Service and such other authorities as we have considered
relevant. It should be noted that the Code, the Regulations and such judicial
decisions, rulings, administrative interpretations and other authorities are
subject to change at any time and, in some circumstances, with retroactive
effect; and any such change could affect the opinion stated herein. Furthermore,
the opinion expressed below might not be applicable to Ocwen shareholders who or
which, for United States federal income tax purposes, are nonresident alien
individuals, foreign corporations, foreign partnerships, foreign trusts or
foreign estates, or who acquired their Ocwen Common Shares pursuant to the
exercise of employee stock options or otherwise as compensation.
Based upon and subject to the foregoing, it is our opinion that the
discussion set forth in the section of the Registration Statement entitled "The
Merger -- Material Federal Income Tax Consequences" constitutes, in all material
respects, a fair and accurate summary of the federal income tax consequences
that are likely to be material to the shareholders of Ocwen.
Except as expressly set forth above, you have not requested, and we do not
herein express, any opinion concerning the tax consequences of, or any other
matters related to, the Merger.
We assume no obligation to update or supplement this letter to reflect any
facts or circumstances which may hereafter come to our attention with respect to
the opinion expressed above, including any changes in applicable law which may
hereafter occur.
This opinion is provided to you only, and without our prior consent, may
not be relied upon, used, circulated, quoted or otherwise referred to in any
manner by any person, firm, governmental authority or entity whatsoever other
than reliance thereon by you. Notwithstanding the foregoing, we hereby consent
to the filing of this letter as an exhibit to the Registration Statement and to
all references to our firm included in or made part of the Registration
Statement.
Very truly yours,
/s/ SIDLEY & AUSTIN
