EXHIBIT 8.1
[XXXXXX & XXXXXXX LETTERHEAD]
, 1999
Mattel, Inc.
000 Xxxxxxxxxxx Xxxxxxxxx
Xx Xxxxxxx, Xxxxxxxxxx 00000
Re: Agreement and Plan of Merger Dated as of December 13, 1998,
By and Between Mattel, Inc. and The Learning Company, Inc.
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Ladies and Gentlemen:
We have acted as special counsel for Mattel, Inc., a Delaware corporation
("Mattel"), in connection with the proposed merger (the "Merger") of The
Learning Company, Inc., a Delaware corporation ("Learning Company"), with and
into Mattel, pursuant to an Agreement and Plan of Merger dated as of December
13, 1998 (the "Merger Agreement") by and between Mattel and Learning Company.
In connection with the filing of a registration statement (the "Registration
Statement") on Form S-4, which includes the joint proxy statement/prospectus
relating to the Merger Agreement, you have requested our opinion regarding
certain United States federal income tax consequences of the Merger. In
providing our opinion, we have examined and are relying upon (without any
independent investigation or review thereof) the truth and accuracy, at all
relevant times, of the statements, covenants, representations and warranties
contained in (i) the Merger Agreement, (ii) the Registration Statement to be
filed by Mattel with the Securities and Exchange Commission (the "SEC"), to
which this opinion appears as an exhibit, (iii) the representations made to us
by Mattel and Learning Company in their respective letters to us each dated the
date hereof (the "Representation Letters"), and (iv) such other documents and
corporate records as we have deemed necessary or appropriate for purposes of
our opinion.
In addition, we have assumed that:
1. Original documents (including signatures) are authentic, documents
submitted to us as copies conform to the original documents, and there has
been (or will be by the effective time of the Merger) due execution and
delivery of all documents where due execution and delivery are
prerequisites to the effectiveness thereof;
2. The Merger will be consummated in the manner contemplated by the
Registration Statement and in accordance with the provisions of the Merger
Agreement, and will be effective under the laws of the State of Delaware;
3. All statements, descriptions and representations contained in any of
the documents referred to herein or otherwise made to us are true and
correct in all material respects, and no actions have been taken or will be
taken which are inconsistent with such statements, descriptions or
representations or which make any such statements, descriptions or
representations untrue, incorrect or incomplete in any material respect;
4. Any statements made in any of the documents referred to herein "to the
knowledge of" or similarly qualified are correct and will continue to be
true, correct and complete at all times
up to and including the Closing Date, as defined in the Merger Agreement,
in each case without such qualification; and
5. The representations made to us in the Representation Letters will
again be made to us as of the Closing Date.
If any of the above-described assumptions are untrue for any reason or if the
Merger is consummated in a manner that is inconsistent with the manner in which
it is described in the Merger Agreement and Registration Statement, our opinion
as expressed below may be adversely affected and may not be relied upon.
Based upon the foregoing, and subject to the qualifications and limitations
stated herein, we are of the opinion that the Merger will constitute a
reorganization within the meaning of section 368(a) of the Internal Revenue
Code of 1986, as amended (the "Code"). Accordingly, the following federal
income tax consequences will result (subject to the limitations and
qualifications set forth herein):
1. No gain or loss will be recognized by Mattel or Learning Company
solely as a result of the Merger;
2. No gain or loss will be recognized by the shareholders of Learning
Company upon the exchange of Learning Company common stock and Learning
Company Series A preferred stock (collectively, the "Learning Company
Stock") solely for shares of Mattel common stock in the Merger;
3. Cash payments received by a holder of Learning Company Stock in lieu
of a fractional share of Mattel common stock will be treated as capital
gain (or loss) measured by the difference between the amount of the cash
payment received and the portion of the holder's adjusted tax basis in the
shares of Learning Company Stock surrendered that is allocable to such
fractional share. Such gain (or loss) will be long-term capital gain (or
loss) if such fractional share of Mattel common stock is considered to have
been held for more than one year at the effective time of the Merger;
4. The adjusted tax basis of the shares of Mattel common stock received
by a Learning Company shareholder in the Merger will be equal to the
adjusted tax basis of such shareholder's shares of Learning Company Stock
exchanged therefor in the Merger, reduced by any portion of such basis
allocable to a fractional share of Mattel common stock treated as sold or
exchanged as provided in the immediately preceding paragraph; and
5. The holding period for the shares of Mattel common stock received by a
Learning Company shareholder will include the holding period for the shares
of Learning Company Stock exchanged therefor by such shareholder in the
Merger, provided that such shares of Learning Company Stock are held as
capital assets at the effective time of the Merger.
This opinion represents and is based upon our best judgment regarding the
application of United States federal income tax laws arising under the Code,
existing judicial decisions, administrative regulations and published rulings
and procedures. Our opinion is not binding upon the Internal Revenue Service or
the courts, and there is no assurance that the Internal Revenue Service will
not assert a contrary position. Furthermore, no assurance can be given that
future legislative, judicial or administrative changes, on either a prospective
or retroactive basis, would not adversely affect the accuracy of the
conclusions stated herein. Nevertheless, we undertake no responsibility to
advise you
or your shareholders of any new developments in the application or
interpretation of the United States federal income tax laws after the
effectiveness of the Registration Statement.
This opinion is rendered to you solely for use in connection with the filing
of the Registration Statement with the SEC and is not to be used, circulated,
quoted or otherwise referred to for any other purpose without our express
written permission. We consent to the filing of this opinion as an exhibit to
the Registration Statement and to the references to our firm name therein. In
giving this consent, we do not admit that we are within the category of persons
whose consent is required under section 7 of the Securities Act of 1933, as
amended, or the rules or regulations of the SEC promulgated thereunder.
Very truly yours,
