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EXHIBIT 5.01
November 16, 2000
Mercury Interactive Corporation
1325 Borregas Avenue
Sunnyvale, CA 94089
Ladies and Gentlemen:
At your request, we have examined the Registration Statement on Form S-3
(the "Registration Statement") filed by you with the Securities and Exchange
Commission (the "Commission") on October 2, 2000, as subsequently amended on or
about November 16, 2000, in connection with the registration under the
Securities Act of 1933, as amended, of (i) $500,000,000 aggregate principal
amount of your 4.75% convertible subordinated notes due July 1, 2007 (the
"Convertible Notes") and (ii) an aggregate of 4,494,400 shares of your common
stock (the "Stock") issuable upon conversion of the Convertible Notes, which
Convertible Notes are convertible into such stock at a conversion rate of
8.9888 shares per $1,000 principal amount of Convertible Notes, subject to
adjustment in certain circumstances. The Stock and Convertible Notes are being
sold by the selling securityholders (the "Selling Securityholders") that may be
specified in the Registration Statement and the prospectus (the "Prospectus")
associated therewith from time to time.
In rendering this opinion, we have examined the following.
(1) your Restated Certificate of Incorporation, together with a
Certificate of Designation and Certificates of Amendment, certified by the
Secretary of State of Delaware on June 29, 2000.
(2) your bylaws, certified by your Secretary on August 11, 1999.
(3) the Registration Statement, together with the exhibits filed as a
part thereof or incorporated therein by reference, including the Indenture
(the "Indenture"), dated July 3, 2000, between you and State Street Bank
and Trust Company of California, N.A. (the "Trustee"), and the form of note
representing the Convertible Notes.
(4) the Prospectus prepared in connection with the Registration
Statement.
(5) the minutes of the meeting of the Board of Directors held on March
16, 2000 and the minutes of the meeting of the Pricing Committee of the
Board of Directors held on June 27, 2000.
(6) a certificate from your transfer agent of even date herewith
verifying the number of your issued and outstanding shares of capital stock
as of the date hereof and a list of option and warrant holders respecting
your capital stock and of any rights to purchase capital stock that was
prepared by you and dated November 16, 2000, verifying the number of such
issued and outstanding securities.
(7) a Management Certificate addressed to us and dated of even date
herewith executed by you containing certain factual and other
representations (the "Management Certificate").
In our examination of documents for purposes of this opinion, we have
assumed, and express no opinion as to, the genuineness of all signatures on
original documents, the authenticity and completeness of all documents
submitted to us as originals, the conformity to originals and completeness of
all documents submitted to us as copies, the legal capacity of all persons or
entities executing the same, the lack of any undisclosed termination,
modification, waiver or amendment to any document reviewed by us and the due
authorization, execution and delivery of all documents where due authorization,
execution and delivery are prerequisites to the effectiveness thereof. We have
also assumed that the certificates representing the Stock have been, or will be
when issued, properly signed by your authorized officers or their agents.
As to matters of fact relevant to this opinion, we have relied solely upon
our examination of the documents referred to above and have assumed the current
accuracy and completeness of the information
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obtained from the documents referred to above and the representations and
warranties made by your representatives to us, including but not limited to
those set forth in the Management Certificate. We have made no independent
investigation or other attempt to verify the accuracy of any of such
information or to determine the existence or non-existence of any other factual
matters; however, we are not aware of any facts that would cause us to believe
that the opinion expressed herein is not accurate.
This opinion is qualified by, and is subject to, and we render no opinion
with respect to, general limitations and exceptions applicable to all
contracts, including, without limitation:
(a) the effect of bankruptcy, insolvency, reorganization, arrangement,
moratorium, fraudulent conveyance and other similar laws relating to or
affecting the rights of creditors generally; and
(b) the effect of general principles of equity and similar principles
including, without limitation, concepts of materiality, reasonableness,
public policy and unconscionability and the possible unavailability of
specific performance, injunctive relief or other equitable remedies,
regardless of whether considered in a proceeding in equity or at law.
In addition, we render no opinion with respect to the validity, binding
effect or enforceability of (a) Section 5.15 of the Indenture entitled "Waiver
of Stay, Usury or Extension Laws," and (b) any provisions of the Indenture
purporting to impose penalties or any increase in interest rate to the extent
they constitute a penalty or are otherwise contrary to public policy.
For the purposes of this opinion, we have also assumed that: (a) the Trustee
has all requisite power and authority, and has taken any and all corporate,
partnership or other action necessary, for the due authorization by the Trustee
of the Trustee's execution, delivery and performance of the Indenture and all
other related documents signed by or on behalf of, or actions taken by or on
behalf of, the Trustee and the performance by the Trustee of all the Trustee's
obligations thereunder; (b) the Trustee's certificate of authentication of the
Convertible Notes have been manually signed by one of the Trustee's authorized
officers; and (c) the Indenture has been duly executed and delivered by all
signatories thereto other than the Company. We are admitted to practice law in
the State of California, and we render this opinion only with respect to, and
express no opinion herein concerning the application or effect of the laws of
any jurisdiction other than (a) the existing federal laws of the United States
of America, (b) the laws of the State of California, (c) with respect to the
validity of corporate action and the requirements for the issuance of stock,
the laws of the State of Delaware as in effect on the date hereof, and (d) with
respect to the opinion expressed in clause (i) of the penultimate paragraph of
this letter and only insofar as such opinion relates to the valid and legally
binding nature of, and the enforceability of, the Convertible Notes, the laws
of the State of New York as in effect on the date hereof.
We have made no inquiry into, and express no opinion with respect to, any
statutes, orders, rules, regulations, treaties or common laws of any other
nation, state or jurisdiction. Since we are admitted to practice law in the
State of California, we express no opinion as to whether or not the laws of any
jurisdiction other than those identified and limited above, are applicable to
the Convertible Notes or Stock.
In connection with our opinion expressed below, we have assumed that, at or
prior to the time of the delivery of any shares of Stock, the Registration
Statement will have been declared effective under the Securities Act of 1933,
as amended, that the registration will apply to such shares of Stock and will
not have been modified or rescinded and that there will not have occurred any
change in law affecting the validity or enforceability of such shares of Stock.
In rendering this opinion, we have also assumed that, at the time of any
issuance of any shares of Stock pursuant to the Registration Statement, the
number of shares of Stock so issued will not exceed that number of shares
obtained by subtracting from the number of shares of common stock then
authorized under your Certificate of Incorporation: (a) the number of shares of
common stock that are then issued and (b) the number of shares of common stock
that are then reserved for issuance pursuant to your then outstanding
commitments or obligations.
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Based upon the foregoing, it is our opinion that (i) the Convertible Notes
are (a) validly issued, and (b) your valid and legally binding obligations
enforceable in accordance with their terms, and (ii) upon conversion of the
Convertible Notes in accordance with their terms, the up to 4,494,400 shares of
Stock that may be sold by the Selling Securityholders pursuant to the
Registration Statement, will be validly issued, fully paid and nonassessable.
We consent to the use of this opinion as an exhibit to the Registration
Statement and further consent to all references to us, if any, in the
Registration Statement, the Prospectus constituting a part thereof and any
amendments thereto. This opinion speaks only as of its date and we assume no
obligation to update this opinion should circumstances change after the date
hereof. This opinion is intended solely for use in connection with the sale of
the Convertible Notes and the issuance and sale of the Stock issuable upon
conversion of the Convertible Notes, all of which Notes and Stock are subject
to the Registration Statement, and is not to be relied upon for any other
purpose.
Very truly yours,
/s/ Fenwick & West LLP
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Fenwick & West LLP
