EX-5.1 3 a2116597zex-5_1.txt EXHIBIT 5.1 Exhibit 5.1 [Letterhead of Skadden, Arps, Slate, Meagher & Flom (Illinois)] August 13, 2003 PEI Holdings, Inc. and each of the entities listed on Schedule I hereto 680 North Lake Shore Drive Chicago, Illinois 60611 Re: PEI Holdings, Inc. 11% Senior Secured Notes due 2010 Registration Statement on Form S-4 ---------------------------------- Ladies and Gentlemen: We have acted as special counsel to PEI Holdings, Inc., a Delaware corporation (the "Company"), and the Guarantors (as defined below) in connection with the public offering of up to $115,000,000 aggregate principal amount of the Company's 11% Senior Secured Notes due 2010 (the "Exchange Notes") and guarantees thereof (the "Guarantees") by each of the guarantors listed on Schedule I hereto (the "Guarantors"). The Exchange Notes and the Guarantees are to be issued under the Indenture, dated as of March 11, 2003 (the "Indenture"), between the Company, the guarantors party thereto and Bank One, N.A., as Trustee (the "Trustee"), as amended by the Supplemental Indenture, dated as of July 22, 2003, among the Company, Andrita Studios, Inc., a California corporation ("Andrita"), and the Trustee (the "Supplemental Indenture"), pursuant to an exchange offer (the "Exchange Offer") in exchange for a like principal amount of the Company's issued and outstanding 11% Senior Secured Notes due 2010, together with guarantees thereof by the Guarantors (the "Original Notes"), as contemplated by the Registration Rights Agreement, dated as of March 11, 2003 (the "Registration Rights Agreement"), by and among the Company, Playboy Enterprises, Inc., a Delaware corporation, the subsidiary guarantors listed on the signature pages thereof, Banc of America Securities LLC and Lazard Freres & Co. LLC. This opinion is being furnished in accordance with the requirements of Item 601(b)(5) of Regulation S-K under the Securities Act of 1933, as amended (the "Act"). In connection with this opinion, we have examined and relied upon originals or copies, certified or otherwise identified to our satisfaction, of the following: PEI Holdings, Inc. and each of the entities listed on Schedule I hereto August 13, 2003 Page 2 (a) the Registration Statement on Form S-4 with respect to the Exchange Notes and the Guarantees (File Nos. 333-105386, 333-105386-01 through -49 and 333-105386-51) as filed with the Securities and Exchange Commission (the "Commission") on May 19, 2003, Amendment No. 1 thereto, filed with the Commission on July 2, 2003, Amendment No. 2 thereto, filed with the Commission on July 25, 2003, and Amendment No. 3 thereto, filed with the Commission on the date hereof (such Registration Statement, as so amended, being hereinafter referred to as the "Registration Statement"); (b) an executed copy of the Registration Rights Agreement; (c) an executed copy of the Indenture; (d) an executed copy of the Supplemental Indenture; (e) the bylaws and certificate of incorporation of the Company; (f) the bylaws or by-laws, as applicable, and certificate of incorporation or articles of incorporation, as applicable, of each of the Guarantors that is a Delaware, Illinois, California or New York corporation and the operating agreement and certificate of formation of each of the Guarantors that is a Delaware limited liability company (the Guarantors described in this clause (f) being referred to hereinafter, collectively, as the "Covered Guarantors"); (g) certain resolutions adopted by the board of directors of the Company and by the board of directors (or persons performing similar functions) of each of the Covered Guarantors relating to the Exchange Offer, the issuance of the Original Notes, the Exchange Notes and the Guarantees, the Indenture and related matters; (h) the Statement of Eligibility of Bank One, National Association to act as trustee under the Indenture, filed with the Commission on July 25, 2003 as Exhibit 25 to the Registration Statement; and (i) the form of the Exchange Notes. We have also examined originals or copies, certified or otherwise identified to our satisfaction, of such records of the Company and the Covered Guarantors and such agreements, certificates of public officials, certificates of officers or other representatives of the Company and the Covered Guarantors and others, and such other documents, certificates and records as we have deemed necessary or appropriate as a basis for the opinions set forth herein. PEI Holdings, Inc. and each of the entities listed on Schedule I hereto August 13, 2003 Page 3 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 facsimile, electronic, certified, conformed or photostatic copies and the authenticity of the originals of such latter documents. In making our examination of documents executed or to be executed, we have assumed that all parties thereto (excluding the Company and the Covered Guarantors) 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 the execution and delivery by such parties of such documents and (except to the extent we have opined on such matters below with respect to the Exchange Notes and the Guarantees) that such documents constitute valid and binding obligations of such parties. We have also assumed that the Guarantors (other than the Covered Guarantors) are validly existing and in good standing under the laws of their respective jurisdictions of incorporation. As to any facts material to the opinions expressed herein which we have not independently established or verified, we have relied upon statements and representations of officers and other representatives of the Company, the Guarantors and others and of public officials. Our opinions set forth herein are limited to (i) the General Corporation Law of the State of Delaware (the "GCL"), (ii) the Limited Liability Company Act of the State of Delaware, (iii) the Business Corporation Law of the State of Illinois, (iv) the General Corporation Law of the State of California, (v) the Business Corporation Law of the State of New York and (vi) the laws of the State of New York that, in our experience, are normally applicable to transactions of the type contemplated by the Exchange Offer and, to the extent that judicial or regulatory orders or decrees or consents, approvals, licenses, authorizations, validations, filings, recordings or registrations with governmental authorities are relevant, to those required under such laws (all of the foregoing being referred to as "Opined on Law"). We do not express any opinion with respect to the laws of any jurisdiction other than the Opined on Law or as to the effect of any such laws on the opinions herein stated. Howard Shapiro, Esq., Executive Vice President, Law and Administration, General Counsel and Secretary of Playboy Enterprises, Inc., a Delaware corporation, may rely on this opinion in rendering his opinion dated the date hereof and to be filed as Exhibit 5.2 to the Registration Statement. Based upon and subject to the foregoing and the limitations, qualifications, exceptions and assumptions set forth herein, we are of the opinion that when the Exchange Notes (in the form examined by us) have been duly executed and authenticated in accordance with the terms of the Indenture and have been delivered upon consummation of the Exchange Offer against receipt of the Original Notes surrendered in exchange therefor in accordance with the terms of the Exchange Offer: (i) the Exchange Notes will constitute valid and binding obligations of the Company, enforceable against the Company in accordance with their terms; and PEI Holdings, Inc. and each of the entities listed on Schedule I hereto August 13, 2003 Page 4 (ii) each Guarantor's Guarantee will constitute the valid and binding obligation of such Guarantor, enforceable against such Guarantor in accordance with its terms, except, in each case, to the extent that enforcement thereof may be limited by (A) bankruptcy, insolvency, reorganization, moratorium, fraudulent conveyance or other similar laws now or hereafter in effect relating to creditors' rights generally and (B) general principles of equity (regardless of whether enforceability is considered in a proceeding at law or in equity). In rendering the opinions set forth above, we have assumed that (1) the execution and delivery (a) by the Company of the Exchange Notes, (b) by the Company and the Guarantors other than Andrita of the Indenture and (c) by the Company and Andrita of the Supplemental Indenture, and (2) the performance by the Company and the Guarantors of their respective obligations thereunder, do not and will not violate, conflict with or constitute a default under any agreement or instrument to which the Company, the Guarantors or their respective properties are subject, except for those agreements and instruments which have been identified to us by Parent as being material to Parent and its subsidiaries and which are listed under Item 21(a) in Part II of the Registration Statement or listed as exhibits to Parent's Annual Report on Form 10-K for the fiscal year ended December 31, 2002, pursuant to Item 15(c) thereof. 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 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 Act or the rules and regulations of the Commission. Very truly yours, /s/ Skadden, Arps, Slate, Meagher & Flom (Illinois) SCHEDULE I Playboy Enterprises, Inc., a Delaware corporation Spice Entertainment, Inc., a Delaware corporation CPV Productions, Inc., a Delaware corporation Cyberspice, Inc., a Delaware corporation MH Pictures, Inc., a California corporation Planet Spice, Inc., a Delaware corporation Spice Direct, Inc., a Delaware corporation Spice International, Inc., a Delaware corporation Spice Networks, Inc., a New York corporation Spice Productions, Inc., a Nevada corporation Playboy Enterprises International, Inc., a Delaware corporation Alta Loma Entertainment, Inc., a Delaware corporation Itasca Holdings, Inc., an Illinois corporation Planet Playboy, Inc., a Delaware corporation Playboy Gaming Nevada, Inc., a Nevada corporation Playboy Japan, Inc., a Delaware corporation Playboy Gaming International, Ltd. , a Delaware corporation Playboy Cruise Gaming, Inc., a Delaware corporation Playboy Gaming UK, Ltd. , a Delaware corporation Lifestyle Brands, Ltd. , a Delaware corporation Lake Shore Press, Inc., a Delaware corporation Playboy Clubs International, Inc., a Delaware corporation Playboy Preferred, Inc., an Illinois corporation Playboy of Sussex, Inc., a Delaware corporation Playboy of Lyons, Inc., a Wisconsin corporation Playboy Club of Hollywood, Inc., a Delaware corporation Playboy Club of New York, Inc., a New York corporation Special Editions, Ltd. , a Delaware corporation Telecom International, Inc., a Florida corporation Spice Platinum Entertainment, Inc., a Delaware corporation Spice Hot Entertainment, Inc., a Delaware corporation Playboy Models, Inc., an Illinois corporation Playboy Properties, Inc., a Delaware corporation Playboy Shows, Inc., a Delaware corporation Steelton, Inc., a Delaware corporation Playboy Entertainment Group, Inc., a Delaware corporation Adultvision Communications, Inc., a Delaware corporation After Dark Video, Inc., a Delaware corporation Alta Loma Distribution, Inc., a Delaware corporation AL Entertainment, Inc., a California corporation Impulse Productions, Inc., a Delaware corporation Indigo Entertainment, Inc., an Illinois corporation Mystique Films, Inc., a California corporation Precious Films, Inc., a California corporation Women Productions, Inc., a California corporation Playboy TV International, LLC, a Delaware limited liability company Claridge Organization LLC, a Delaware limited liability company Chelsea Court Holdings LLC, a Delaware limited liability company Candlelight Management LLC, a Delaware limited liability company Andrita Studios, Inc., a California corporation