View:
Filed by: Dorchester Minerals, L.P.
Pursuant to Rule 425 under the Securities Act of 1933
and deemed filed pursuant to Rule 14a-12(b)
of the Securities Exchange Act of 1934
Commission File No. 333-88282
Subject Company: Dorchester Minerals, L.P.
The following draft of legal opinion of Thompson & Knight LLP was provided
to counsel for Energy Trust LLC, the investment manager for the Republic ORRI
Owners, on January 28, 2003 in connection with the proposed reorganization of
Republic Royalty Company and the subsequent combination of the business and
properties of Republic, among others, into Dorchester Minerals, L.P.
[ERISA and Tax Opinion on Combination]
January 31, 2003
Republic Royalty Company, L.P.
3738 Oak Lawn Avenue, Suite 300
Dallas, Texas 75219
Energy Trust LLC
551 Fifth Avenue, 37th Floor
New York City, New York 10176-3799
Re: Merger of Republic Royalty Company, L.P. into Dorchester Minerals, L.P.
Ladies and Gentlemen:
We have acted as counsel to Republic Royalty Company, L.P., a Texas limited
partnership ("Republic"), in connection with the preparation and filing of the
proxy statement/prospectus forming a part of the registration statement on Form
S-4 and the amendments and supplements thereto (collectively, the "Registration
Statement"), filed by Dorchester Minerals, L.P., a Delaware limited partnership
("DMLP"), with the Securities and Exchange Commission on October 30, 2002. The
Registration Statement describes a transaction in which Republic will be merged
into DMLP (the "Combination"), with the Republic limited partners receiving
common units of DMLP in exchange for their limited partnership interests. Among
the limited partners of Republic receiving common units in DMLP will be those
parties listed on Exhibit A attached hereto (the "Limited Partners").
In our capacity as counsel to Republic, we have been requested to render
certain opinions concerning the application to the Combination of certain
provisions of the Internal Revenue Code of 1986, as amended (the "Code"), and
the Employee Retirement Income Security Act of 1974, as amended ("ERISA"). Our
opinions are based on the provisions of the Code and ERISA, as well as
regulations and other relevant interpretive authority, in existence as of the
date of this opinion, any of which could be changed at any time, with or without
retroactive effect. Subsequent amendments or changes in the Code, ERISA,
regulations or other relevant interpretive authority (which may be retroactive
in application) may alter the opinions expressed herein. Based on the foregoing,
and on the representations and statements of fact contained in the Registration
Statement and the assumptions made herein, and subject to the limitations set
forth herein, it is our opinion that:
1. As to those Limited Partners which are employee benefit plans subject to
ERISA and Section 4975 of the Code (the "Plans"), the Combination will not be a
prohibited transaction within the meaning of Sections 4975(c)(1)(A) through (D)
of the Code, or Section 406(a) of Title I of ERISA.
2. Immediately following the Combination, the assets of DMLP will not be
classified as "plan assets" under the Department of Labor Regulation Section
2510.3-101 (the "Plan Asset Regulation") because the common units in DMLP
received by the Plans as a result of the Combination will qualify as
"publicly-offered securities" as defined in section (b)(2) of the Plan Asset
Regulation.
3. No unrelated business taxable income ("UBTI") under Section 511 of the
Code will be realized by the Plans as a result of the Combination.
The foregoing opinions are subject to and are qualified in all respects by
the following:
(a) The opinions expressed herein are limited in all respects to the
federal laws of the United States of America.
(b) We have assumed that no person who is a "party in interest" within the
meaning of Section 3(14) of ERISA or a "disqualified person" within the meaning
of Section 4975(e)(2) of the Code with respect to the Plans owns or will own
directly or indirectly as a result of the Combination 50% or more of the capital
or profits interests of either Republic or DMLP.
(c) We have assumed that Republic and its general partners have not
heretofore become "fiduciaries" under Section 3(21) of ERISA or under Section
4975(e)(3) of the Code with respect to the Plans.
(d) We have assumed that Energy Trust LLC is a qualified professional asset
manager with respect to each Plan, as defined in Prohibited Transaction
Exemption 84-14 adopted by the Department of Labor effective December 31, 1982,
and is acting in such capacity on behalf of the Plans with respect to the
Combination.
(e) We have assumed that DMLP will have more than 100 partners independent
of DMLP and of each other immediately after the Combination.
(f) We are unable to express an opinion as to whether the Combination will
constitute or result in non-exempt prohibited transactions within the meaning of
Section 4975(c) of the Code or Section 406 of ERISA solely as a result of any
actions taken by the Plans or their representatives or any other person or
entity other than Republic or DMLP or their respective general partners.
(g) We have assumed that the Plans are exempt from federal income taxation
under Section 501(a) of the Code.
(h) We have assumed that none of the Plans now owns or will hereafter own,
directly or indirectly, 50% or more of the capital or profits interests in
Republic or DMLP.
(i) We have assumed that Republic has not and DMLP will not incur any
obligation or liability to any person to pay the costs incurred in exploring,
developing and operating any of the mineral or royalty interests held by
Republic or DMLP or participate in the operations of any such properties.
(j) We have assumed that the mineral and royalty interests held by Republic
have been and those held by DMLP will be treated as non-operating mineral rights
under the laws of any state having jurisdiction over such properties.
(k) The opinions expressed herein are made as of the date hereof, and we
assume no, and expressly disclaim any, obligation to update or supplement such
opinions to reflect any facts or circumstances which may hereafter come to our
attention or any changes in laws which may hereafter occur which might affect
any matters or opinions set forth herein.
(l) The opinions expressed herein are strictly limited to the matters
stated herein, and no other opinions may be implied.
This opinion is being provided at your request and is furnished to you for
your use in connection with the Combination. It may be relied upon by you and by
the Plans for that limited purpose, and may not be relied upon or utilized by
any other party for any purpose. No other use or distribution of this opinion
may be made without our prior written consent.
Very truly yours,
THOMPSON & KNIGHT L.L.P.
By:
Thornton Hardie, III, Partner
TH/KQ
069041 000003 DALLAS 1541178.2
EXHIBIT A
Limited Partners
AT&T Master Pension Trust
Lucent Technologies, Inc. Master Pension Trust
Kodak Retirement Income Plan Trust
Eastman Retirement Assistance Plan Trust
Boeing Company Employee Retirement Plans Master Trust
Bell Atlantic Master Trust
Delta Airlines Master Trust