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Exhibit 5.1
June 2, 2000
eToys Inc.
3100 Ocean Park Blvd., Suite 300
Santa Monica, California 90405
Re: eToys Inc.
Registration Statement on Form S-3
Dear Ladies and Gentlemen:
We have acted as special counsel to eToys Inc., a Delaware
corporation ("eToys"), in connection with the preparation of the Registration
Statement (File No. 333-90311), initially filed by eToys with the Securities and
Exchange Commission (the "Commission") on Form S-1 on February 7, 2000, under
the Securities Act of 1933, as amended (the "Securities Act"), and Amendment No.
1 on Form S-3 thereto, filed on June 2, 2000 (as so amended, the "Registration
Statement"). The Registration Statement relates to sale from time to time by
certain selling securityholders (as set forth in the Registration Statement, the
"Selling Securityholders"), pursuant to Rule 415 of the General Rules and
Regulations of the Commission promulgated under the Securities Act, of
$150,000,000 principal amount of 6.25% Convertible Subordinated Notes, due
December 1, 2004, of eToys (the "Notes") and such indeterminate number of shares
of the common stock, $0.0001 par value per share (the "Common Stock"), of eToys
into which such Notes are convertible.
This opinion is being furnished in accordance with the
requirements of Item 601(b)(5) of Regulation S-K promulgated under the
Securities Act.
In connection with this opinion, we have examined originals or
copies (including facsimile transmissions), certified or otherwise identified to
our satisfaction, of (i) the Registration Statement, as amended through the
date hereof; (ii) the Indenture for the Notes, dated as of December 6, 1999 (the
"Indenture"), by and between eToys and U.S. Bank Trust National Association, as
trustee, including
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eToys Inc.
June 2, 2000
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the form of Note, as filed as an exhibit to the Registration Statement; (iii)
the Registration Rights Agreement dated December 1, 1999 relating to the Notes
as filed as an exhibit to the Registration Statement (the "Registration Rights
Agreement"); (iv) the Certificate of Incorporation of eToys, as presently in
effect; (v) the By-laws of eToys, as presently in effect; (vi) certain
resolutions adopted to date by the Board of Directors of eToys (the "Board
Resolutions") relating to the Notes, the Registration Statement, and the
Registration Rights Agreement; and (vii) a specimen stock certificate for the
Common Stock. We have also examined originals or copies, certified or otherwise
identified to our satisfaction, of such records of eToys and the Selling
Securityholders and such agreements, certificates or records of public
officials, certificates of officers or other representatives of eToys and the
Selling Securityholders, and such other documents, certificates and records as
we have deemed necessary or appropriate as a basis for the opinions set forth
herein.
In our examination, we have assumed the legal capacity of all
natural persons, the genuineness of all signatures, the authenticity of all
documents submitted to us as originals, the conformity to original documents of
all documents submitted to us as certified, conformed or photostatic copies and
the authenticity of the originals of such copies. In making our examination of
documents executed or to be executed by parties other than eToys, we have
assumed that such parties had or will have the power, corporate or other, to
enter into and perform all obligations thereunder and have also assumed the due
authorization by all requisite action, corporate or other, and execution and
delivery by such parties of such documents and the validity, enforceability and
binding effect thereof. As to any facts material to the opinions expressed
herein which were not independently established or verified, we have relied upon
oral or written statements and representations of officers and other
representatives of eToys and the Selling Securityholders.
In rendering the opinion set forth herein, we have further
assumed that the execution and delivery by eToys of the Indenture, the Notes and
the Registration Rights Agreement and the performance of its obligations
thereunder do not and will not violate, conflict with or constitute a default
under (i) any agreement or instrument to which eToys is subject, (ii) any law,
rule, or regulation to which eToys is subject, (iii) any judicial or regulatory
order or decree of any governmental authority, or (iv) any consent, approval,
license, authorization or validation of, or filing, recording or registration
with any governmental authority. In rendering the opinion set forth in
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eToys Inc.
June 2, 2000
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paragraph 2, we have assumed that the certificate for the Common Stock will be
duly signed and in the form of the specimen stock certificate examined by us and
duly registered in the stock record books maintained for such purpose.
We do not express any opinion as to the laws of any
jurisdiction other than those of the State of Delaware and the State of New
York.
1. The Notes have been duly authorized, executed, issued and
delivered by eToys, and constitute legal, valid, and binding obligations of
eToys entitled to the benefits of the Indenture and enforceable against eToys in
accordance with their terms, except (a) to the extent that enforcement thereof
may be limited by (i) bankruptcy, insolvency (including, without limitation, all
laws relating to fraudulent transfers), reorganization, moratorium or other
similar laws now or hereafter in effect relating to creditors' rights generally,
and (ii) general principles of equity (regardless of whether enforcement is
considered in a proceeding in equity or at law), (b) the waiver in Section 5.15
of the Indenture may be deemed unenforceable, and (c) we express no opinion
regarding the enforceability or effect of Section 6.7 of the Indenture.
2. The shares of Common Stock initially issuable upon
conversion of the Notes have been duly authorized and reserved for issuance by
eToys and, if and when issued, upon conversion of the Notes in accordance with
the provisions of the Indenture, at conversion prices at or in excess of the
par value of such shares of eToys common stock, such shares of eToys common
stock will be validly issued, fully paid and nonassessable.
We hereby consent to the filing of this opinion with the
Commission as an exhibit to the Registration Statement. We also consent to the
reference to our firm under the caption "Legal Matters" in the prospectus which
constitutes a part of the Registration Statement. In giving this consent, we do
not thereby admit that we are included in the category of persons whose consent
is required under Section 7 of the Securities Act or the rules and regulations
of the Commission promulgated
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eToys Inc.
June 2, 2000
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thereunder. This opinion is expressed as of the date hereof and we disclaim any
undertaking to advise you of any subsequent changes in the facts stated or
assumed herein or of any subsequent changes in applicable law.
Very truly yours,
/S/ SKADDEN, ARPS, SLATE,
MEAGHER & FLOM LLP
