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Exhibit 8.1
[Ernst & Young LLP Letterhead]
June 9, 2000
Solomon
Software, Inc.
200 East Hardin Street
PO Box 414
Findlay, OH 45840
Pursuant to your request, this letter provides our opinion concerning certain federal income tax consequences which would arise from consummation of the proposed acquisition by Great Plains Software, Inc., ("Great Plains") of Solomon Software, Inc. ("Solomon") by merging GPS Eagle Inc., ("Merger Sub") with and into Solomon (the "Merger"). The Merger is pursuant to the Agreement and Plan of Merger dated May 1, 2000 (the "Merger Agreement") among Great Plains, Merger Sub, Solomon, Gary M. Harpst, Vernon M. Strong and Jack W. Ridge. We are rendering our opinion in accordance with Section 7.02(g) of the Merger Agreement. Except as otherwise noted, capitalized terms contained herein shall have the same meaning given to such terms in the Documents as such term is defined below.
In providing this analysis, we have reviewed and relied upon the following (collectively referred to as the "Documents"): (1) the Merger Agreement; (2) the Statements of Facts and Representations received from the management of Great Plains and Solomon ("Statement of Facts"); (3) the Escrow Agreement dated May 1, 2000 (the "Escrow Agreement") among Great Plains, Merger Sub, Solomon, Gary M. Harpst, Vernon M. Strong and Jack W. Ridge; and (4) the Registration Statement of Form S-4, Registration No. 333-37188, as filed by Great Plains with the Securities and Exchange Commission (the "SEC") on May 16, 2000 (the "Registration Statement").
You have represented to us that the Documents provide an accurate, true and complete description of the facts and circumstances concerning the Merger and that the copies provided to us are accurate and that the signatures are genuine. We have made no independent determination regarding such facts and circumstances and, therefore, have relied upon the Documents with regard thereto for purposes of this letter. Any changes to such Documents may adversely affect the analysis provided herein.
We understand that reference to Ernst & Young LLP and our opinion is included in the Prospectus relating to the issuance of Great Plains Common Stock in connection with the Merger and the special meeting of the Solomon shareholders with respect thereto. We consent to such reference in the Prospectus under the captions "Conditions to the Merger," "U.S. Federal Income Tax Consequences to the Merger," "Material Federal Income Tax Consequences," and "Legal and Tax Matters." We also understand that this letter is included as an appendix to the Registration Statement and the Prospectus. We consent to such inclusion.
In addition, we have assumed that (i) the Merger will be consummated in accordance with the Merger Agreement as described in the Registration Statement (including satisfaction of all covenants and conditions to the obligations of the parties without amendment or waiver thereof), and (ii) each of Great Plains, Merger Sub and Solomon will report the Merger on their respective federal income tax returns in a manner consistent with the opinions set forth herein and otherwise comply with all applicable provisions of the Internal Revenue Code of 1986, as amended (the "Code") and Treasury Regulations promulgated thereunder. No ruling has been or will be sought from the Internal Revenue Service as to the federal income tax consequences of the Merger.
FEDERAL INCOME TAX CONSEQUENCES
Based upon our review and examination of the contents of the Documents, and based upon the facts and representations provided by the management of Great Plains and Solomon, we are of the opinion that the following federal income tax consequences will result from the Merger:
The scope of this opinion is expressly limited solely to the federal income tax issues specifically addressed in (1) through (6) in the section entitled "FEDERAL INCOME TAX CONSEQUENCES" above. Specifically, our analysis has not been requested, and we have made no determination nor expressed any views concerning any other issues, including, but not limited to, any state and local, foreign, consolidated return, employee benefit, Section 280G "excess parachute" and Section 382 issues, or alternative minimum tax consequences to the parties to this transaction. Further, no opinion is expressed as to: (i) the qualification of the Merger as a statutory merger under state law; and (ii) any valuation issues which may arise in connection with the Merger.
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Our opinion, as stated above, is based upon our analysis of the Internal Revenue Code of 1986, as amended, the Treasury Regulations, current case law, and published Internal Revenue Service authorities. The foregoing are subject to change, and such change may be retroactively effective. No assurance can be provided as to the effect of any such change upon our analysis. In addition, our analysis is based on the information contained in the Documents. Any variation or differences in the Documents may affect our analysis, perhaps in an adverse manner. We have undertaken no obligation to update this letter for changes in facts or law occurring subsequent to the date thereof.
This letter represents our views as to the interpretation of existing tax law and is not binding on the Internal Revenue Service or the courts. No assurance can be given that, if the matter were contested, the Internal Revenue Service or a court would agree with this analysis.
Very truly yours,
/s/ Ernst & Young LLP
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