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EXHIBIT 8
May 12, 1998
Sense8 Corporation and its Shareholders
000 Xxxxxxxxx Xxxxxxx, Xxxxx 000
Xxxx Xxxxxx, Xxxxxxxxxx 00000
Ladies and Gentlemen:
This opinion is being delivered to you pursuant to the Amended and
Restated Agreement and Plan of Merger (the "Agreement") dated as of April 30,
1998, between Engineering Animation, Inc., a Delaware corporation ("EAI"),
EAICA, Inc., a California corporation and wholly owned subsidiary of EAI, and
Sense8 Corporation, a California corporation ("Sense8"). Pursuant to the
Agreement and the related Agreement of Merger (collectively, the "Merger
Agreements"), Sense8 will merge with and into EAI (the "Merger").
Except as otherwise provided, capitalized terms referred to herein have
the meanings set forth in the Merger Agreements. All section references, unless
otherwise indicated, are to the Internal Revenue Code of 1986, as amended (the
"Code").
We have acted as legal counsel to Sense8 in connection with the Merger.
As such, and for the purpose of rendering this opinion, we have examined (or
will examine on or prior to the Effective Time) and are relying (or will rely)
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 the following documents (the "Documents"):
1. The Merger Agreements;
2. The EAI Registration Statement relating to the shares
of EAI stock being issued in the Merger, including the Sense8 Proxy
Statement/Prospectus relating to the Merger which is a part of the Registration
Statement;
3. Representations made to us in a letter by XXX;
4. Representations made to us in a letter by Sense8;
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5. Such other instruments and documents related to the
operation of Sense8 and EAI, or to the consummation of the Merger and the
transactions contemplated thereby, as we have deemed necessary or appropriate.
In connection with rendering this opinion, we have assumed or obtained
representations (and are relying thereon, without any independent investigation
or review thereof) that:
1. The Merger will be consummated in accordance with the
Documents presented to us, and all relevant representations, statements and
assumptions in the Documents and in this letter will be true, accurate and
complete from the date hereof through and including the Effective Time;
2. 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) due execution and delivery of all
documents where due execution and delivery are prerequisites to effectiveness
thereof;
3. Any representation or statement made "to the knowledge of"
or otherwise similarly qualified is correct without such qualification. As to
all matters as to which a person or entity making a representation has
represented that such person or entity either is not a party to, does not have,
or is not aware of any plan, intention, understanding or agreement to take an
action, there is in fact no plan, intent, understanding or agreement and such
action will not be taken; and
4. The Merger will be effective under applicable state laws.
Based on our examination of the foregoing items and subject to the
assumptions, exceptions, limitations and qualifications set forth herein, we are
of the opinion that, for federal income tax purposes, the Merger will constitute
a "reorganization" as defined in Section 368(a)(1)(A) of the Code and EAI and
Sense8 will each be a "party to a reorganization" within the meaning of Section
368(b) of the Code. We are also of the opinion that the discussion in the
Registration Statement under the caption "The Merger--Certain Federal Income Tax
Consequences," insofar as it relates to matters of federal income tax law, is a
fair and accurate summary of such matters.
In addition to the assumptions set forth above, this opinion is subject
to the exceptions, limitations and qualifications set forth below:
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1. This opinion represents and is based upon our best judgment
regarding the application of 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
successfully assert a contrary position. Furthermore, no assurance can be given
that future legislative, judicial or administrative changes, on either a
prospective or retroactive basis, will not adversely affect the accuracy of the
conclusions stated herein. Nevertheless, we undertake no responsibility to
advise you of any new developments in the application or interpretation of the
federal income tax laws.
2. This opinion addresses only the matters specifically
discussed and does not address any other federal, state, local or foreign tax
consequences that may result from the Merger or any other transaction (including
any transaction undertaken in connection with the Merger). In particular, we
express no opinion regarding (i) whether and the extent to which any Sense8
shareholder who has provided or will provide services to Sense8 or EAI will have
compensation income under any provision of the Code; (ii) the effects of such
compensation income, including but not limited to the effect upon the basis and
holding period of the EAI stock received by any such shareholder in the Merger;
(iii) the potential application of the "golden parachute" provisions (Sections
280G, 3121(v)(2) and 4999) of the Code, the alternative minimum tax provisions
(Sections 55, 56 and 57) of the Code or Sections 305, 306, 357, 424 and 708, or
the regulations promulgated thereunder; (iv) the corporate-level tax
consequences of the Merger to EAI or Sense8, including without limitation the
recognition of any gain and the survival and/or availability, after the Merger,
of any of the federal income tax attributes or elections of Sense8, after
application of any provision of the Code, as well as the regulations promulgated
thereunder and judicial interpretations thereof; (v) the tax consequences of any
transaction in which Sense8 stock or a right to acquire Sense8 stock was
received; and (vi) the tax consequences of the Merger to holders of options or
warrants for Sense8 stock or that may be relevant to particular classes of
Sense8 shareholders such as dealers in securities, foreign persons and holders
of shares acquired upon exercise of stock options or in other compensatory
transactions.
3. No opinion is expressed as to any transaction other than
the Merger as described in the Merger Agreements or to any transaction
whatsoever, including the Merger, if all the transactions described in the
Merger Agreements are not consummated in accordance with the terms of such
Merger Agreements and without waiver or breach of any material provision thereof
or if all of the relevant representations, warranties, statements and
assumptions upon which we relied are not true and accurate at all relevant
times. In the event any one of the statements, representations, warranties or
assumptions upon which we have relied to issue this opinion is incorrect, our
opinion might be adversely affected and may not be relied upon.
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4. This opinion has been delivered to you for the purpose of
satisfying the conditions of the Agreement and is intended solely for the
benefit of you and your shareholders; it may not be relied upon for any other
purpose or by any other person or entity, and may not be made available to any
other person or entity without our prior written consent. We hereby consent to
the filing of this letter as an exhibit to the Registration Statement relating
to the shares of EAI stock being issued in the merger.
Very truly yours,
XXXXXXX, XXXXXXX & XXXXXXXX LLP
