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Exhibit 8.2
_________ __, 1996
Oclassen Pharmaceuticals, Inc.
000 Xxxxxxx Xxx
Xxx Xxxxxx, XX 00000
Ladies and Gentlemen:
This opinion is being delivered to you pursuant to Section 6.1(i) of
the Agreement and Plan of Merger (the "Agreement") among Xxxxxx Pharmaceuticals,
Inc., a Nevada corporation ("Xxxxxx"), its wholly-owned subsidiary, Opalacq Co.,
a Delaware corporation ("Xxxxxx Sub"), and Oclassen Pharmaceuticals, Inc., a
Delaware corporation ("Oclassen"), dated as of September 25, 1996, as amended
effective November 14, 1996. Pursuant to the Agreement, Xxxxxx Sub will merge
with and into Oclassen (the "Merger"), and Oclassen will become a wholly-owned
subsidiary of Xxxxxx.
Except as otherwise provided, capitalized terms referred to herein have
the meanings set forth in the 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 Oclassen 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 of the Merger) 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
(including all schedules and exhibits thereto):
1. The Agreement (including Exhibits and Schedules);
2. Representations made to us by Xxxxxx and Xxxxxx Sub in a
letter reproduced as Exhibit A hereto;
3. Representations made to us by Xxxxxxxx in a letter reproduced
as Exhibit B hereto;
4. Representations made by certain shareholders of Oclassen in
"Affiliate Agreements"; and
5. Such other instruments and documents related to the formation,
organization and operation of Xxxxxx, Xxxxxxxx and Xxxxxx Sub 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:
A. 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
effectiveness thereof;
B. Any representation or statement made "to the knowledge of "or
otherwise similarly qualified is correct without such qualification. As to all
matters in 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 such plan, intention, understanding or agreement and such action will
not be taken;
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C. The Merger will be consummated pursuant to the Agreement and
will be effective under the laws of the State of Delaware;
D. The shareholders of Oclassen do not, and will not on or before
the Effective Time of the Merger, have an existing plan or intent to dispose of
an amount of Xxxxxx Common Stock to be received in the Merger (or to dispose of
Oclassen capital stock in anticipation of the Merger) such that the shareholders
of Oclassen will not receive and retain a meaningful continuing equity ownership
in Xxxxxx that is sufficient to satisfy the continuity of interest requirement
as specified in Treas. Reg. Section 1.368-1(b) and as interpreted in certain
Internal Revenue Service rulings and federal judicial decisions;
E. After the Merger, Oclassen will hold "substantially all" of
its and Xxxxxx Sub's properties within the meaning of Section 368(a)(2)(E)(i) of
the Code and the regulations promulgated thereunder and will continue its
historic business or use a significant portion of its historic business assets
in a business;
F. To the extent any expenses relating to the Merger (or the
"plan of reorganization" within the meaning of Treas. Reg. Section 1.368-1(e)
with respect to the Merger) are funded directly or indirectly by a party other
than the incurring party, such expenses will be within the guidelines
established in Revenue Ruling 73-54, 1973-1 C.B. 187; any expenses paid on
behalf of Oclassen shareholders will not exceed one percent (1%) of the total
consideration that will be issued in the Merger to Oclassen shareholders in
exchange for their shares of Oclassen stock; and
G. No Oclassen shareholder guaranteed any Oclassen indebtedness
outstanding during the period immediately prior to the Merger, and at all
relevant times, including as of the Effective Time of the Merger, (i) no
outstanding indebtedness of Xxxxxxxx, Xxxxxx or Xxxxxx Sub has or will represent
equity for tax purposes; (ii) no outstanding equity of Oclassen, Xxxxxx or
Xxxxxx Sub has or will represent indebtedness for tax purposes; (iii) and no
outstanding security, instrument, agreement or arrangement that provides for,
contains, or represents either a right to acquire Oclassen stock or to share in
the appreciation thereof constitutes or will constitute "stock" for purposes of
Section 368(e) of the Code.
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 be a
"reorganization" as defined in Section 368(a) of the Code and Xxxxxx and
Xxxxxxxx will each be a party to that reorganization within the meaning of
Section 368(b) of the Code.
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 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, would 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 classification of the Merger
as a reorganization under Section 368(a) of the Code, 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, except as expressly stated in the
preceding sentence, we express no opinion regarding (i) whether and the extent
to which any Oclassen shareholder who has provided or will provide services to
Xxxxxxxx, Xxxxxx or Xxxxxx Sub 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 Xxxxxx stock
received by any such
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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 Xxxxxx, Xxxxxx Sub or
Oclassen, 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 Oclassen, after application of any provision of the
Code, as well as the regulations promulgated thereunder and judicial
interpretations thereof; (v) the basis of any equity interest in Oclassen
acquired by Xxxxxx in the Merger; (vi) the tax consequences of any transaction
in which Oclassen stock or a right to acquire Oclassen stock was received; (vii)
the tax consequences to any Oclassen shareholder or to Oclassen, Xxxxxx or
Xxxxxx Sub of a forfeiture to Xxxxxx of all or any part of the shares held in
the Escrow Fund; and (viii) the tax consequences of the Merger (including the
opinion set forth above) as applied to shareholders of Oclassen with special tax
status or circumstances and/or holders of options or warrants for Oclassen stock
or that may be relevant to particular classes of Oclassen shareholders and/or
holders of options or warrants for Oclassen stock such as dealers in securities,
corporate shareholders subject to the alternative minimum tax, 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 Agreement or to any transaction whatsoever, including
the Merger, if all the transactions described in the Agreement are not
consummated in accordance with the terms of such Agreement and without waiver or
breach of any material provision thereof or if all of the 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.
4. This opinion has been delivered to you for the purpose of
satisfying the conditions set forth in Section 6.1(i) of the 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.
Very truly yours,
VENTURE LAW GROUP
A Professional Corporation
