EXHIBIT 8
XXXXXX XXXXXXX, P.A.
0000 XXXXX XXXXXXX XXXXXX
XXXXX 0000
XXXXXXX, XXXXXXX 00000-0000
NOVEMBER 24, 1997
National Health Enchancement Systems, Inc.
0000 Xxxxx Xxxxxxx Xxxxxx
Xxxxx 0000
Xxxxxxx, Xxxxxxx 00000
Ladies and Gentlemen:
This opinion is being delivered in connection with the Agreement of Merger
("Merger Agreement"), dated as of October 2, 1997, by and among HBO & Company
("Parent"), HBO & Company of Georgia ("Purchaser"), and National Health
Enhancement Systems, Inc. ("Acquired Company"). Pursuant to the Merger
Agreement, Acquired Company will merge with and into Purchaser (the "Merger"),
and Purchaser will be the surviving corporation. This opinion is issued with
respect to certain Federal income tax consequences of the Merger. Reference to
such opinion is made in the Proxy Statement/Prospectus (the "Proxy
Statement/Prospectus") contained in the Registration Statement of Parent (File
No. 333-39525) (the "Registration Statement") dated November 24, 1997.
All capitalized terms not otherwise defined herein have the meaning assigned
to them in the Merger Agreement. 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 Acquired Company in connection with the
Merger. As such, and for the purpose of rendering this 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 the following documents:
1. The Merger Agreement;
2. The Proxy Statement/Prospectus;
3. Representations made to us by Parent and Purchaser;
4. Representations made to us by Acquired Company;
5. Representations made to us by certain holders of five percent (5%) or
more of the Acquired Company stock in continuity of interest certificates;
and
6. Such other documents, records, legal opinions and matters of law as
in our judgment were necessary or appropriate.
In connection with rendering this opinion, we have assumed (without any
independent investigation or review thereof) that original documents (including
signatures) are authentic, that documents submitted to us as copies conform to
the original documents, and that 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. We have
assumed that the Merger will be consummated pursuant to applicable state law in
accordance with the Merger Agreement and as described in the Proxy
Statement/Prospectus.
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:
1. The Merger will qualify as a reorganization pursuant to Section
368(a) of the Code;
2. No gain or loss will be recognized by Acquired Company as the result
of the consummation of the Merger;
3. No gain or loss will be recognized by an Acquired Company stockholder
upon the exchange of the shares of Acquired Company Common Stock for shares
of Parent Common Stock pursuant to the Merger, except on the receipt of cash
in lieu of a fractional share interest in Parent Common Stock;
4. The aggregate adjusted tax basis of shares of Parent Common Stock
received (including fractional share interests deemed received) by an
Acquired Company stockholder as the result of the Merger will be the same as
the aggregate adjusted tax basis of the shares of Acquired Company Common
Stock surrendered in exchange therefor;
5. The holding period of the shares of Parent Common Stock received
(including fractional share interests deemed received) by an Acquired
Company stockholder as a result of the Merger will include the holding
period of the shares of Acquired Company Common Stock surrendered in
exchange therefor, provided that such Acquired Company Common Stock is held
as a capital asset by the Acquired Company stockholder at the consummation
of the Merger; and
6. An Acquired Company stockholder who receives cash in lieu of a
fractional interest in a share of Parent Common Stock will be treated as if
the fractional share were distributed as part of the exchange and were then
redeemed for the cash payment, resulting in gain or loss equal to the
difference between the cash amount received and the portion of the
stockholder's basis in Acquired Company Common Stock allocable to the
fractional share.
In addition to the assumptions set forth above, this opinion is subject to
the exceptions, limitations and qualifications set forth below.
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 we cannot provide assurance that the Internal Revenue
Service will not assert a contrary position. Furthermore, we cannot provide
assurance that future legislative, judicial or administrative changes would
not, on either a prospective or retroactive basis, adversely affect the
accuracy of the conclusions stated herein. Moreover, we undertake no
responsibility to advise you of any new developments in the application or
interpretation of the Federal income tax laws as they might relate to this
opinion.
2. This opinion addresses only whether the Merger will qualify as a
reorganization under Section 368(a) of the Code and the federal income tax
consequences listed above. The opinion does not address any other federal or
any state, local or foreign tax consequences that may result from the Merger
or any other transaction.
3. No opinion is expressed as to any transaction other than the Merger
as described in the Merger Agreement. Moreover, we have assumed that all the
transactions described in the Agreements have been or will be consummated in
accordance with the terms of such Agreements and without waiver or breach of
any material provision thereof and that all of the representations,
warranties, statements and assumptions upon which we have relied remain true
and accurate at all relevant times. In the event that any of the
representations, warranties, statements or assumptions upon which we have
relied is incorrect, this opinion may be adversely affected and some or all
of the conclusions stated above may not apply.
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4. This opinion has been delivered to you for the purpose of satisfying
the condition set forth in Section 7.5 of the Merger Agreement and is
intended solely for your benefit. 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.
5. We hereby consent to the filing of this opinion as Exhibit 8 to the
Registration Statement and the reference to this firm under the headings
"Certain Federal Income Tax Consequences" and "Certain Legal Matters" in
such Registration Statement.
Very truly yours,
XXXXXX XXXXXXX, P.A.
By: /s/ Xxxxxx H Curzon_______________
Xxxxxx X. Xxxxxx
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