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EXHIBIT 5.1
July 28, 2000
Merrill Lynch, Pierce, Fenner & Smith Incorporated
250 Vesey Street
New York, New York 10281
Merrill Lynch, Pierce, Fenner & Smith Incorporated
Market 2000+ HOLDRSSM Trust
Registration Statement on Form S-1
(File No. 333-37980)
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Ladies and Gentlemen:
We are acting as counsel to Merrill Lynch, Pierce, Fenner & Smith
Incorporated, a Delaware corporation (the "Initial Depositor"), and as special
counsel to the Market 2000+ HOLDRSSM Trust (the "Trust") in connection with the
preparation and filing with the Securities and Exchange Commission (the
"Commission") of the Registration Statement on Form S-1, as amended from time
to time and filed by the Initial Depositor (the "Registration Statement"), of
which the prospectus forms a part (the "Prospectus"), for the registration
under the Securities Act of 1933, as amended (the "Securities Act"), of
1,000,000,000 Market 2000+ HOLDRSSM (the "HOLDRSSM") to be issued by the Trust.
In this capacity, we have examined (a) a signed copy of the Registration
Statement and (b) a copy of the depositary trust agreement between The Bank of
New York, as trustee (the "Trustee"), and Merrill Lynch, Pierce, Fenner & Smith
Incorporated, as initial depositor (the "Depositary Trust Agreement"). We have
also examined originals, or copies certified or otherwise identified to our
satisfaction, of such other corporate records of the Initial Depositor, such
other certificates and advice of public officials and of officers of the
Initial Depositor, and such other agreements, instruments and documents as we
have deemed necessary as a basis for the opinions expressed below. In such
examination we have assumed the genuineness of all signatures, the authenticity
of all documents submitted to us as originals, and the conformity with the
originals of all documents submitted to us as copies. As to questions of fact
material to such opinions, we have relied upon such certificates and advice.
The opinions set forth below are also based upon the assumptions that: (i) the
Registration Statement, as finally amended (including any post-effective
amendments), has become effective under the Securities Act; (ii) the amount,
price, and other principal terms of the HOLDRSSM have been approved by the
Board of Directors of the Initial Depositor or an authorized designee thereof;
(iii) the Depositary Trust Agreement will be duly authorized, executed and
delivered by the parties thereto substantially in the form filed as an exhibit
to the Registration Statement; and (iv) the HOLDRSSM will be duly authenticated
by the Trustee in accordance with the Depositary Trust Agreement and sold and
delivered by the Initial Depositor against payment therefor.
Our opinions expressed herein are limited to the laws of the State of New
York, and the Federal law of the United States, and we do not express any
opinion herein concerning any other law.
Based upon and subject to the foregoing, and having regard for such legal
considerations as we have deemed relevant, we are of the opinion that the
HOLDRSSM will be legally issued, fully paid and nonassessable, will be legal,
valid and binding obligations of the Trust, enforceable against the Trust in
accordance with their terms, except as enforcement thereof may be limited by
bankruptcy, insolvency (including, without limitation, all laws relating to
fraudulent transfers), reorganization, moratorium or similar laws affecting the
enforcement of creditors' rights generally and except as enforcement thereof is
subject to
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general principles of equity (regardless of whether enforcement is considered
in a proceeding at law or in equity).
We hereby consent to the use of this opinion as an exhibit to the
Registration Statement and to the use of our name under the heading "Legal
Matters" in the Prospectus. In giving this consent, we do not thereby concede
that we come within the category of persons whose consent is required by the
Securities Act or the General Rules and Regulations promulgated thereunder.
Very truly yours,
/s/ Shearman & Sterling
