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Exhibit 8.1
[CRAVATH, SWAINE & XXXXX LETTERHEAD]
[New York Office]
March 8, 1999
Agreement and Plan of Merger,
Dated as of November 22, 1998,
Among the X.X. Xxxxxxxx Company,
Runway Acquisition Corporation and
Coltec Industries Inc.
Ladies and Gentlemen:
We have acted as special tax counsel for Coltec Industries Inc., a
Pennsylvania corporation (the "Company"), in connection with the proposed
merger (the "Merger") of Runway Acquisition Corporation ("Sub"), a Pennsylvania
corporation and a wholly owned subsidiary of The X.X. Xxxxxxxx Company, a New
York corporation ("Parent"), with and into the Company pursuant to an Agreement
and Plan of Merger, dated as of November 22, 1998 (the "Merger Agreement"),
among Parent, Sub and the Company. In the Merger, each issued and outstanding
share of common stock, par value $.01 per share, of the Company (the "Company
Common Stock") not owned directly by the Company, Parent or Sub will be
converted into .56 of a share of common stock, par value $5.00 per share, of
Parent ("Parent Common Stock").
In that connection, you have requested our opinion regarding the material
U.S. Federal income tax consequences of the Merger. In providing our opinion,
we have examined the Merger Agreement, the registration statement on Form S-4
(the "Registration Statement"), which includes the proxy statement/prospectus
of the Company and Parent, as filed with the Securities and Exchange
Commission, and such other documents and corporate records as we have deemed
necessary or appropriate for purposes of our opinion. In addition, we have
assumed that (i) the Merger will be consummated in the manner contemplated by
the Registration Statement and in accordance with the provisions of the Merger
Agreement,
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(ii) the statements concerning the Merger set forth in the Merger Agreement and
the Registration Statement are true, correct and complete, (iii) the
representations made to us by the Company and Parent in their respective
letters to us each dated as of the date hereof, and delivered to us for
purposes of this opinion are true, correct and complete (such letters, the
"Representation Letters"), and (iv) any representations made in the
Representation Letters or in the Merger Agreement "to the best knowledge of"
or similarly qualified are true, correct and complete without such
qualification. If any of the above-described assumptions are untrue for any
reason or if the Merger is consummated in a manner that is inconsistent with
the manner in which it is described in the Merger Agreement or the Registration
Statement, our opinions as expressed below may be adversely affected and may
not be relied upon.
Based upon the foregoing, we are of opinion that, for U.S. Federal income
tax purposes, (i) the Merger will constitute a "reorganization" within the
meaning of Section 368(a) of the Internal Revenue Code of 1986, as amended (the
"Code"), (ii) the Company, Parent and Sub will each be a party to such
reorganization within the meaning of Section 368(b) of the Code, (iii) the
Company will not recognize any gain or loss as a result of the Merger, (iv)
Company shareholders will not recognize gain or loss upon their exchange of
Company Common Stock for Parent Common Stock pursuant to the Merger, except
that a Company shareholder who receives cash proceeds instead of a fractional
share interest in Parent Common Stock will recognize a gain or loss equal to
the difference between the cash received and the tax basis allocated to the
fractional share interest. Such gain or loss will be capital gain or loss if
the shareholder's shares of Company Common Stock are held as a capital asset at
the effective time of the Merger, and will be long-term capital gain or loss if
such shares of Company Common Stock have been held for more than one year at
the effective time of the Merger, (v) Company shareholders will have the same
tax basis in Parent Common Stock as they had in their Company Common Stock
(reduced by any tax basis allocable to a fractional share interest for which
cash is received) and (vi) the holding period of Parent Common Stock received
by a Company shareholder will include the period during which the Company
Common Stock surrendered in exchange therefor was held, provided that such
Company Common Stock was held by such Company shareholder as a capital asset at
the effective date of the Merger.
Our opinions are limited to the tax matters specifically covered hereby,
and we have not been asked to
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address, nor have we addressed, any other tax consequences of the Merger or any
other transactions. Our opinions are based upon current statutory, regulatory
and judicial authority, any of which may be changed at any time with
retroactive effect. We disclaim any undertaking to advise you of any subsequent
changes of the matters stated, represented or assumed herein or any subsequent
changes in applicable law, regulations or interpretations thereof.
We consent to the filing of this opinion as Exhibit 8.1 to the
Registration Statement and to the reference to our firm name therein. In giving
this consent, we do not admit that we are within the category of persons whose
consent is required under Section 7 of the Securities Act of 1933, as amended,
or the rules or regulations of the SEC promulgated thereunder.
Very truly yours,
/s/ CRAVATH, SWAINE & XXXXX
Coltec Industries Inc.
3 Coliseum Center
0000 Xxxx Xxxxxx Xxxx
Xxxxxxxxx, XX 00000
