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EXHIBIT 8.1
June 29, 2000
To the Parties Listed on Schedule I:
Re: First Sierra Equipment Contract Trust 2000-2
Ladies and Gentlemen:
We have acted as tax counsel to SierraCities.com Inc.
("SierraCities") and First Sierra Receivables III, Inc. (the "Depositor"), in
connection with the issuance by First Sierra Equipment Contract Trust 2000-2
(the "Trust"), established pursuant to a Trust Agreement, dated as of June 1,
2000, between the Depositor and First Union Trust Company, National Association,
as Owner Trustee, of (i) $50,018,622 of 6.937525% Equipment Contract Backed
Notes, Class A-1 (the "Class A-1 Notes"), (ii) $29,609,332 of 7.35% Equipment
Contract Backed Notes, Class A-2 (the "Class A-2 Notes"), (iii) $51,393,341 of
7.49% Equipment Contract Backed Notes, Class A-3 (the "Class A-3 Notes"), (iv)
$33,416,247 of 7.56% Equipment Contract Backed Notes, Class A-4 (the "Class A-4
Notes" and, together with the Class A-1 Notes, the Class A-2 Notes and the Class
A-3 Notes, the "Class A Notes"), (v) $21,149,523 of 7.77% Equipment Contract
Backed Notes, Class B (the "Class B Notes"), (vi) $12,689,714 of 8.20% Equipment
Contract Backed Notes, Class C (the "Class C Notes"), $4,229,905 of 11.51%
Equipment Contract Backed Notes, Class D (the "Class D Notes") and (vii)
$4,124,157 of 7.69% Equipment Contract Backed Notes, Class E (the "Class E
Notes"). The Class A Notes, the Class B Notes, the Class C Notes, the Class D
Notes and the Class E Notes are collectively referred to as the "Notes." The
Notes were issued pursuant to an Indenture, dated as of June 1, 2000 (the
"Indenture"), among the Trust, SierraCities, as servicer and as originator, and
Bankers Trust Company, as indenture trustee (the "Indenture Trustee").
Capitalized terms used herein, unless otherwise defined, shall have the meanings
set forth in Annex A to the Indenture.
We have examined the question of whether the Notes issued
under the Indenture will be treated as indebtedness for federal income tax
purposes. Our analysis is based on the provisions of the Internal Revenue Code
of 1986, as amended, and the Treasury regulations promulgated thereunder as in
effect on the date hereof and on existing judicial and administrative
interpretations thereof. These authorities are subject to change and to
differing interpretations, which could apply retroactively. The opinion of tax
counsel is not binding on the courts or the Internal Revenue Service (the
"IRS").
In general, whether a transaction constitutes the issuance of
indebtedness for federal income tax purposes is a question of fact, the
resolution of which is based primarily upon
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To The Parties Listed On Schedule I
June 29, 2000
Page 2
the economic substance of the instruments and the transaction pursuant to which
they are issued rather than the form of the transaction or the manner in which
the instruments are labeled. No transaction closely comparable to the
transactions contemplated by the Indenture has been the subject of any Treasury
regulation, revenue ruling, or judicial decision. The IRS and the courts have
set forth various factors to be taken into account in determining whether or not
a transaction constitutes the issuance of indebtedness for federal income tax
purposes, which we have reviewed as they apply to this transaction.
Based on the foregoing, and representations made by the
Underwriters, as well as and such legal and factual investigations as we have
deemed appropriate, we are of the opinion that for federal income tax purposes:
(1) The Class A Notes, the Class B Notes and the Class C Notes
will be characterized as indebtedness and, although such conclusion is not free
from doubt, the Class D Notes should be characterized as indebtedness because
(i) the characteristics of the transaction strongly indicate that in economic
substance the transaction is the issuance of indebtedness; (ii) the form of the
transaction is an issuance of indebtedness; and (iii) the parties have stated
unambiguously their intention to treat the transaction as an issuance of
indebtedness for all applicable tax purposes.
(2) Assuming compliance with the terms of the Trust Agreement
and related documents, the Trust will not be characterized as an association (or
a publicly traded partnership) taxable as a corporation.
(3) The statements in the Prospectus Supplement and the
Memorandum under the heading "Material Federal Income Tax Consequences"
accurately describe the material federal income tax consequences to the holders
of the Notes.
Our opinion contained herein is rendered only as of the date
hereof, and we undertake no obligation to update this letter or the opinion
contained herein after the date hereof. We hereby expressly reserve our opinion
with regard to the Class E Notes. This opinion is furnished by us as tax counsel
in connection with the issuance of the Notes, and is not to be used, circulated,
quoted, or otherwise referred to for any other purpose without our express
written consent.
Very truly yours,
/s/ Dewey Ballantine LLP
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Schedule I
Bankers Trust Company
Four Albany Street, 10th Floor
New York, New York 10006
First Union Trust Company, National Association
One Rodney Square
920 King Street, Suite 102
Wilmington, Delaware 19801
First Sierra Equipment Contract Trust 2000-2
c/o First Union Trust Company, National Association
One Rodney Square
920 King Street, Suite 102
Wilmington, Delaware 19801
SierraCities.com Inc.
600 Travis Street
Houston, Texas 77002
First Sierra Receivables III, Inc.
600 Travis Street
Houston, Texas 77002
First Union Securities, Inc.
as representative of the several Underwriters and as Placement Agent
One First Union Center, TW-10
301 South College Street
Charlotte, N.C. 28288-0610
Merrill Lynch, Pierce, Fenner and Smith, Incorporated
World Financial Center, North Tower
New York, New York 10080
Standard & Poor's Ratings Group,
a division of The McGraw Hill Companies
26 Broadway 15th Floor
New York, New York 10004
Fitch, Inc.
One State Street Plaza
New York, New York 10004
