EXHIBIT 5.1
XXXXXXXX & XXXXXXXX
000 Xxxxxxx Xxxxxx, X.X.
Washington, D.C. 20005
000-000-0000
July 22, 1998
e-Net, Inc.
00000 Xxxxxxxxxxx Xxxx, Xxxxx 000
Xxxxxxxxxx, Xxxxxxxx 00000
Re: Shares of Common Stock, par value $0.01, of e-Net, Inc. (the
"Company") to be offered and sold pursuant to the Company's
Registration Statement on Form S-8, as filed on July 22, 1998
(such shares of Common Stock, the "Common Stock" and such
Registration Statement, as it may be amended from time to
time, the "Registration Statement")
Ladies & Gentlemen:
We have acted as counsel to the Company in connection with the
proposed issuance of the Common Stock pursuant to the Registration Statement.
We are members of the Bar of the District of Columbia. We do
not hold ourselves out as experts on, nor do we express any opinion as to or
with respect to the applicability of, the laws of any jurisdiction other than
the laws of the District of Columbia, the federal laws of the United States, and
the General Corporation Law of the State of Delaware (the "Opining
Jurisdictions").
We express no opinion with respect to any of the following
legal issues: (a) state or federal securities laws or regulations; (b)
fraudulent transfer and fraudulent conveyance laws; or (c) federal and state tax
laws and regulations.
In connection with this Opinion, we have examined the
Registration Statement, the prospectus related thereto (the "Prospectus") and
the Company's 1997 Nonqualified Stock Option Plan, as amended (the "Plan"). In
addition to the Registration Statement, we have reviewed such documents and
given consideration to such matters of law and fact as we have deemed
appropriate, in our professional judgment, to render this Opinion. We have also
relied, without further independent investigation, as to certain matters of
fact, on information
e-Net, Inc.
July 22, 1998
Page 2
obtained from public officials, from officers of the Company and from other
sources believed by us to be responsible.
The assumptions, opinions and conclusions stated below are
subject to: (a) bankruptcy, insolvency, reorganization, receivership, moratorium
and other similar laws affecting the rights and remedies of creditors generally;
and (b) general principles of equity and the exercise of judicial discretion.
We have assumed, without further investigation, the following:
(a) all natural persons who are involved have sufficient legal capacity to enter
into and perform the offer, issuance, sale and delivery by the Company of the
shares of Common Stock and the purchase of such shares by the purchasers
thereof, all as contemplated by the Registration Statement, the Prospectus and
the Plan (the "Transactions") or to carry out their respective roles in the
Transactions; (b) each party to the Transactions has satisfied those legal
requirements that are applicable to it to the extent necessary to make the
agreements contemplated by the Registration Statement, the Prospectus and the
Plan (the "Agreements") to which it is a party enforceable against it; (c) each
party to the Transactions has complied with all legal requirements pertaining to
its status as such status relates to its rights to enforce the Agreements
against the other parties to the Transactions; (d) each document submitted to us
for review is accurate and complete, each such document that is an original is
authentic, each such document that is a copy conforms to an authentic original,
and all signatures on each such document are genuine; (e) each certificate
issued by a government official concerning a person or entity's property or
status is accurate, complete and authentic and all official public records
(including their proper indexing and filing) are accurate and complete; (f) the
conduct of the parties to the Transactions has complied with any requirement of
good faith, fair dealing and unconscionability; (g) the parties have acted in
good faith and without notice of any defense against the enforcement of any
rights created by the Transactions; (h) there are no agreements or
understandings among the parties, written or oral, and there is no usage of
trade or course of prior dealing among the parties that would, in either case,
define, supplement or qualify the terms of the Agreements; (i) all statutes,
judicial and administrative decisions, and rules and regulations of governmental
agencies constituting the law of the Opining Jurisdictions are generally
available (i.e., in terms of access and distribution following publication or
other release) to lawyers practicing in the Opining Jurisdictions, and are in a
format which makes legal research reasonably feasible; (j) the constitutionality
or validity of a relevant statute, rule, regulation or agency action is not in
issue unless a reported decision in the Opining Jurisdiction has specifically
addressed but not resolved, or has established, its unconstitutionality or
validity; (k) the parties will obtain all permits and governmental approvals
required in the future, and take all actions similarly required, relevant to
subsequent consummation of the Transactions or performance of the Agreements;
(l) all parties to the Transactions will act in accordance with, and will
refrain from taking any action that is forbidden by, the terms and conditions of
the Agreements; and (m) the Transactions and the execution, delivery and
performance of the Agreements will not (i) breach, or result in a default under,
any existing obligation of a party to the Transactions to a contract to which
such party is a party or by which its property is bound, or (ii) breach or
otherwise violate any existing obligation of any court and administrative order,
writ, judgment or decree that names any such party and is specifically directed
to it or its property. Each assumption specifically described in this Opinion
e-Net, Inc.
July 22, 1998
Page 3
is made with the express consent and approval of the Company. However, we have
not relied on information (including certificates or other documentation) or
assumptions, otherwise appropriate in the circumstances, if we have knowledge
that the information or assumptions are false or if we have knowledge of facts
that under the circumstances would make the reliance unreasonable.
This Opinion speaks only as of its date. We have no obligation
to advise the Company (or any third party) of changes in law or fact that occur
after the date of this Opinion, even though the change may affect the legal
analysis, a legal conclusion or an informational confirmation in this Opinion.
Based upon the foregoing and subject to the qualifications
contained in the next paragraph, we are of the opinion that the shares of Common
Stock are validly authorized and, when (a) the pertinent provisions of the
Securities Act of 1933 and such "blue sky" and other securities laws as may be
applicable have been complied with and (b) such shares have been duly delivered
against payment therefor as contemplated by the Registration Statement, the
Prospectus and the Plan, such shares will be validly issued, fully paid, and
nonassessable.
We note that the Company intended to increase the number of
its authorized shares of Common Stock from 10,000 to 50,000,000 (the "Increase")
by mean of a Certificate of Amendment to its Certificate of Incorporation, which
amendment was filed with the Delaware Secretary of State on January 25, 1996
(the "Prior Amendment"). However, the Increase was not formally ratified by the
shareholders of the Company until a special meeting held on March 15, 1996. On
April 14, 1998, the Company filed a Certificate of Correction (the "Correction")
correcting the effective date of the Increase from January 25, 1996 to March 15,
1996. While the matter is not entirely free from doubt, in our opinion it is
very unlikely that the Correction was not effective to cause the Increase. Also
in our opinion, the Correction should be effective to correct the effective date
of the Increase to March 15, 1996.
This Opinion deals only with the specific legal issues it
explicitly addresses. Accordingly, the express opinions set forth above
concerning a particular legal issue do not address any other matters.
We consent to the filing of this opinion as an Exhibit to the
Registration Statement. In giving this consent, we do not admit that we are in
the category of persons whose consent is required under Section 7 of the
Securities Act of 1933 or the rules and regulations thereunder.
Very truly yours,
/s/ Xxxxxxxx & Xxxxxxxx
XXXXXXXX & XXXXXXXX
