EXHIBIT 8.1
[Letterhead of Xxxxxxx Xxxxxxx & Xxxxxxxx]
[date]
America Online, Inc.
00000 XXX Xxx
Xxxxxx, XX 00000-0000
Agreement and Plan of Merger
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Dated as of January 10, 2000,
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Between America Online, Inc. and
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Time Warner Inc.
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Dear Sirs:
We have acted as counsel for America Online, Inc., a Delaware
Corporation ("America Online"), in connection with the transactions contemplated
by the Agreement and Plan of Merger (the "Merger Agreement") dated as of January
10, 2000, between America Online and Time Warner Inc. ("Time Warner"), in which
America Online Merger Sub Inc. ("America Online Merger Sub"), a subsidiary of
AOL Time Warner Inc. ("AOL Time Warner"), a newly organized Delaware
corporation, shall be merged with and into America Online with America Online
surviving as a wholly owned subsidiary of AOL Time Warner (the "America Online
Merger") and Time Warner Merger Sub Inc. ("Time Warner Merger Sub"), another
subsidiary of AOL Time Warner, shall be merged with and into Time Warner with
Time Warner surviving as a wholly owned subsidiary of AOL Time Warner (the "Time
Warner Merger") (the America Online Merger together with the Time Warner Merger,
the "Merger"). Capitalized terms not otherwise defined herein shall have the
meanings specified in the registration
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statement on Form S-4 (the "Registration Statement"), which includes the Joint
Proxy Statement and Prospectus of America Online and Time Warner (the "Proxy
Statement/Prospectus"), as filed with the Securities and Exchange Commission
(the "SEC"). This opinion is being delivered in connection with the Registration
Statement to which this opinion appears as an exhibit.
In that connection, you have requested our opinion regarding certain
U.S. federal income tax consequences of the Merger. In providing our opinion,
we have examined the Merger Agreement, the Registration Statement which includes
the Joint Proxy Statement/Prospectus, and such other documents and corporate
records as we have deemed necessary or appropriate for purposes of our opinion.
We have not, however, undertaken any independent investigation of any factual
matter set forth in any of the foregoing. In addition, we have assumed with
your consent that (i) the Merger will be consummated in accordance with the
provisions of the Merger Agreement and the Registration Statement, (ii) the
statements concerning the Merger set forth in the Merger Agreement and the
Registration Statement are true, complete and correct and will remain true,
complete and correct at all times up to and including the Effective Time (as
defined in the Merger Agreement), (iii) the representations made by AOL Time
Warner, America Online and Time Warner, in their respective letters delivered to
us for purposes of this opinion (the "Representation Letters") are true,
complete and correct and will remain true, complete and correct at all times up
to and including the Effective Time (as defined in the Merger Agreement) and
(iv) any representations made in the Representation Letters "to the knowledge
of" or similarly qualified are correct without such qualification. We have also
assumed that the parties have complied with and, if applicable, will continue to
comply with, the covenants contained in the Merger Agreement. If any of the
above described assumptions are untrue for any reason or if the Merger is
consummated in a manner that is different from the manner in which they are
described in the Merger Agreement or the Proxy Statement/Prospectus, our
opinions as expressed below may be adversely affected and may not be relied
upon.
Based upon the foregoing, for U.S. federal income tax purposes, we are
of opinion that (i) the America Online Merger and the Time Warner Merger will
each constitute an exchange to which Section 351 of the Internal Revenue Code of
1986, as amended (the "Code"), applies or a
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reorganization within the meaning of Section 368(a) of the Code, or both; (ii)
no gain or loss will be recognized by AOL Time Warner, America Online or America
Online Merger Sub as a result of the Merger; (iii) no gain or loss will be
recognized by U.S. Holders of America Online common stock on the exchange of
their America Online common stock for AOL Time Warner common stock; (iv) the
aggregate adjusted basis of the AOL Time Warner capital stock received in the
Merger by a U.S. Holder of America Online common stock will be equal to the
aggregate adjusted basis of the U.S. Holder's America Online common stock
exchanged for that AOL Time Warner common stock; and (v) assuming America Online
common stock is held by a U.S. holder as a capital asset within the meaning of
Section 1221 of the Code, the holding period of the AOL Time Warner common stock
received in the Merger by such U.S. Holder of America Online common stock will
include the holding period of the U.S. Holder's America Online common stock
exchanged for that AOL Time Warner common stock.
Our opinions are based on current provisions of the Code, Treasury
Regulations promulgated thereunder, published pronouncements of the Internal
Revenue Service and case law, any of which may be changed at any time with
retroactive effect. Any change in applicable laws or the facts and
circumstances surrounding the Merger, or any inaccuracy in the statements,
facts, assumptions or representations upon which we have relied, may affect the
continuing validity of our opinions as set forth herein. We assume no
responsibility to inform you of any such change or inaccuracy that may occur or
come to our attention. Finally, our opinions are limited to the tax matters
specifically covered hereby, and we have not been asked to address, nor have we
addressed, any other tax consequences of the Merger.
We express our opinion herein only as to those matters specifically
set forth above and no opinion should be inferred as to the tax consequences of
the Merger under any state, local or foreign law, or with respect to other areas
of United States federal taxation. We are members of the Bar of the State of
New York, and we do not express any opinion herein concerning any law other than
the federal law of the United States. We hereby consent to the filing of this
opinion as Exhibit 8.1 to the Registration Statement and to the use of our name
under the caption "Material United States Federal Income Tax Consequences of the
Merger."
