[LETTERHEAD OF BALLARD SPAHR ANDREWS & INGERSOLL]
FILE NUMBER
865374
July 16, 1998
Kranzco Realty Trust
128 Fayette Street
Conshohocken, Pennsylvania 19428
Re: Kranzco Realty Trust
Registration Statement on Form S-4
Registration No. 333-52743
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Ladies and Gentlemen:
We have served as Maryland counsel to Kranzco Realty Trust, a Maryland
real estate investment trust (the "Company"), in connection with certain
matters of Maryland law arising out of the registration of (a) $8,000,000 of
its Callable Convertible Subordinated Notes due 2008 (the "Notes") and (b)
400,000 Common Shares (the "Conversion Shares") of Beneficial Interest, par
value $.01 per share, of the Company ("Common Shares") issuable upon conversion
of the Notes, in connection with the Company's offer to exchange (the "Exchange
Offer") $.7707 of Notes for each outstanding share of common stock, par value
$.01 per share (each, an "NAI Share" and collectively, the "NAI Shares") of New
America Network, Inc., a Delaware corporation ("NAI"), validly tendered on or
prior to the Expiration Date and not properly withdrawn, not to exceed
10,379,531 NAI Shares, as described in the above-referenced Registration
Statement, as amended (the "Registration Statement"), under the Securities Act
of 1933, as amended (the "1933 Act"). Capitalized terms used but not defined
herein shall have the meanings given to them in the Registration Statement.
In connection with our representation of the Company, and as a basis for
the opinion hereinafter set forth, we have examined originals, or copies
certified or otherwise identified to our satisfaction, of the following
documents (hereinafter collectively referred to as the "Documents"):
Kranzco Realty Trust
July 16, 1998
Page 2
1. The Registration Statement in the form in which it was transmitted to
the Securities and Exchange Commission (the "Commission"), including the
related form of Prospectus (the "Prospectus") included therein;
2. The Amended and Restated Declaration of Trust of the Company, as
amended (the "Declaration of Trust") certified as of a recent date by the State
Department of Assessments and Taxation of Maryland (the "SDAT");
3. The Bylaws of the Company, certified as of a recent date by its
Secretary;
4. Resolutions adopted by the Board of Trustees, or a duly authorized
committee thereof, relating to (i) the issuance of the Notes and (ii) the
authorization of the sale, issuance and registration of the Conversion Shares,
certified as of a recent date by the Secretary of the Company;
5. The Exchange Agreement;
6. The form of Indenture (the "Indenture") attached as an Exhibit to the
Registration Statement;
7. The form of certificates evidencing the Notes (the "Note Certificate")
included in the Indenture;
8. The form of certificate evidencing Common Shares (the "Share
Certificate") attached as an Exhibit to the Registration Statement;
9. A certificate of the SDAT, as of a recent date, as to the good standing
of the Company;
10. A certificate executed by the Secretary of the Company, dated the date
hereof; and
11. Such other documents and matters as we have deemed necessary or
appropriate to express the opinion set forth in this letter, subject to the
assumptions, limitations and qualifications stated herein.
In expressing the opinion set forth below, we have assumed, and so far as
is known to us there are no facts inconsistent with, the following:
Kranzco Realty Trust
July 16, 1998
Page 3
1. Each of the parties (other than the Company) executing any of the
Documents has duly and validly executed and delivered each of the Documents to
which such party is a signatory, and such party's obligations set forth therein
are legal, valid and binding and are enforceable in accordance with all stated
terms.
2. Each individual executing any of the Documents on behalf of a party
(other than the Company) is duly authorized to do so.
3. Each individual executing any of the Documents, whether on behalf of
such individual or another person, is legally competent to do so.
4. All Documents submitted to us as originals are authentic. The form and
content of any Documents submitted to us as unexecuted drafts do not differ in
any respect relevant to this opinion from such Documents as executed and
delivered. All Documents submitted to us as certified or photostatic copies
conform to the original documents. All signatures on all such Documents are
genuine. All public records reviewed or relied upon by us or on our behalf are
true and complete. All statements and information contained in the Documents
are true and complete, however, we have not relied upon such statements and
information to the extent that they constitute matters of Maryland law as to
which we express an opinion herein. There has been no modification or amendment
to any provision of any of the Documents and there has been no waiver of any
provision of any of the Documents, by action or conduct of the parties or
otherwise.
5. The Board of Trustees, or a duly authorized committee thereof, will set
the interest rate of the Notes prior to the issuance of any of the Notes.
The phrase "known to us" is limited to the actual knowledge, without
independent inquiry, of the lawyers at our firm who have performed legal
services in connection with the issuance of this opinion.
Based upon the foregoing, and subject to the assumptions, limitations and
qualifications stated herein, it is our opinion that:
1. The Company is a real estate investment trust duly formed and validly
existing under and by virtue of the laws of the State of Maryland and is in
good standing with the SDAT.
Kranzco Realty Trust
July 15, 1998
Page 4
2. The Company has duly authorized the issuance of the Notes pursuant to
the Indenture by all necessary Trust action.
3. The Conversion Shares have been duly authorized and, upon issuance on
conversion of the Notes in accordance with the terms of the Indenture and
delivery of the Conversion Shares in the form of the Share Certificate, such
Conversion Shares will be (assuming that upon any such issuance the total
number of Common Shares issued and outstanding will not exceed the total number
of Common Shares that the Company is then authorized to issue under the
Declaration of Trust) validly issued, fully paid and nonassessable.
The foregoing opinion is limited to the substantive laws of the State of
Maryland and we do not express any opinion herein concerning any other law. We
express no opinion as to compliance with the securities (or "blue sky") laws of
the State of Maryland.
We assume no obligation to supplement this opinion if any applicable law
changes after the date hereof or if we become aware of any fact that might
change the opinion expressed herein after the date hereof.
This opinion is being furnished to you for your submission to the
Commission as an exhibit to the Registration Statement and, accordingly, may
not be relied upon by, quoted in any manner to, or delivered to any other
person or entity without, in each instance, our prior written consent.
Notwithstanding the foregoing, Robinson Silverman Pearce Aronsohn & Berman LLP,
counsel to the Company, may rely upon this opinion for the purpose of
delivering its opinion with respect to the Notes.
We hereby consent to the filing of this opinion as an exhibit to the
Registration Statement and to the use of the name of our firm in the section
entitled "Legal Matters" in the Registration Statement. In giving this consent,
we do not admit that we are within the category of persons whose consent is
required by Section 7 of the 1933 Act.
We further consent to the use of this opinion as an exhibit to the
Company's applications to the Securities Commissioners of various states of the
United States in connection with the registration or qualification of the Notes
and/or the Conversion Shares.
Kranzco Realty Trust
July 15, 1998
Page 5
Very truly yours,
/s/ Ballard Spahr
Andrews & Ingersoll LLP