EXHIBIT 5
[LETTERHEAD]
March 20, 1998
Grubb & Ellis Company
2215 Sanders Road, Suite 400
Northbrook IL 60062
Re: $150,000,000 Aggregate Offering Price of Securities of Grubb & Ellis
Company
Ladies and Gentlemen:
In connection with a registration statement on Form S-3 (the "Registration
Statement") filed on March 20, 1998 with the Securities and Exchange Commission
(the "Commission") under the Securities Act of 1933, as amended (the "Securities
Act"), you have requested our opinion with respect to the matters set forth
below.
You have provided us with a draft prospectus (the "Prospectus") which is a
part of the Registration Statement. The Prospectus provides that it will be
supplemented in the future by one or more supplements to the Prospectus (each, a
"Prospectus Supplement"). The Prospectus as supplemented by various Prospectus
Supplements will provide for the issuance and sale by Grubb & Ellis Company, a
Delaware corporation (the "Company"), of up to $150,000,000 aggregate offering
price of (i) one or more series of senior, senior subordinated or subordinated
debt securities (the "Debt Securities"), (ii) one or more series of preferred
stock, par value $0.01 per share (the "Preferred Stock"), (iii) shares of common
stock, par value $0.01 per share (the "Common Stock"), or (iv) warrants to
purchase Common Stock, Preferred Stock or Debt Securities (collectively, the
"Warrants"). The Debt Securities, Preferred Stock, Common Stock and Warrants are
collectively referred to herein as the "Securities." Any Debt Securities may be
exchangeable and/or convertible into shares of Common Stock or Preferred Stock.
The Preferred Stock may also be exchangeable for and/or convertible into shares
of Common Stock or another series of Preferred Stock. The Debt Securities will
be issued pursuant to one or more indentures and one or more supplements thereto
(collectively, the "Indentures"), in each case between the Company and a trustee
(each, a "Trustee").
In our capacity as your special counsel in connection with the Registration
Statement, we are generally familiar with the proceedings taken and proposed to
be taken by the Company in connection with the authorization and issuance of the
Securities. For purposes of this opinion, we have assumed that such proceedings
will be timely and properly completed, in accordance with all requirements of
applicable federal, Delaware and New York laws, in the manner presently
proposed.
We have made such legal and factual examinations and inquiries, including an
examination of originals and copies certified or otherwise identified to our
satisfaction, of all such documents, corporate records and instruments of the
Company as we have deemed necessary or appropriate for purposes of this opinion.
In our examination, we have assumed the genuineness of all signatures, the
authenticity of all documents submitted to us as originals, and the conformity
to authentic original documents of all documents submitted to us as copies.
We have been furnished with, and with your consent have exclusively relied
upon, certificates of officers of the Company with respect to certain factual
matters. In addition, we have obtained and relied upon such certificates and
assurances from public officials as we have deemed necessary.
Grubb & Ellis Company
March 20, 1998
Page 2
We are opining herein as to the effect on the subject transaction only of
the federal securities laws of the United States, the General Corporation Law of
the State of Delaware and with respect to the opinion, set forth in Paragraph 1
below and Paragraph 4 (to the extent the Warrants are Warrants to purchase Debt
Securities), the internal laws of the State of New York, and we express no
opinion with respect to the applicability thereto, or the effect thereon, of the
laws of any other jurisdiction or, in the case of Delaware, any other laws, or
as to any matters of municipal law or the laws of any local agencies within any
state.
Subject to the foregoing and the other qualifications set forth herein, it
is our opinion that, as of the date hereof:
1. When (a) the Debt Securities have been duly established in
accordance with the terms of the applicable Indenture (including, without
limitation, the adoption by the Board of Directors of the Company of a
resolution duly authorizing the issuance and delivery of the Debt
Securities), duly authenticated by the Trustee and duly executed and
delivered on behalf of the Company against payment therefor in accordance
with the terms and provisions of the applicable Indenture and as
contemplated by the Registration Statement, the Prospectus and the related
Prospectus Supplement(s), and (b) when the Registration Statement and any
required post-effective amendment thereto and any and all Prospectus
Supplement(s) required by applicable laws have all become effective under
the Securities Act, and (c) assuming that the terms of the Debt Securities
as executed and delivered are as described in the Registration Statement,
the Prospectus and the related Prospectus Supplement(s), and (d) assuming
that the Debt Securities as executed and delivered do not violate any law
applicable to the Company or result in a default under or breach of any
agreement or instrument binding upon the Company, and (e) assuming that the
Debt Securities as executed and delivered comply with all requirements and
restrictions, if any, applicable to the Company, whether or not imposed by
any court or governmental or regulatory body having jurisdiction over the
Company, and (f) assuming that the Debt Securities are then issued and sold
as contemplated in the Registration Statement, the Prospectus and the
related Prospectus Supplement(s), the Debt Securities will constitute valid
and legally binding obligations of the Company, enforceable against the
Company in accordance with the terms of the Debt Securities.
2. The Company has the authority pursuant to its Restated Certificate
of Incorporation, as amended (the "Certificate of Incorporation"), to issue
up to 50,000,000 shares of Common Stock. Upon adoption by the Board of
Directors of the Company of a resolution in form and content as required by
applicable law and upon issuance and delivery of and payment for such shares
in the manner contemplated by the Registration Statement, the Prospectus and
the related Prospectus Supplement(s) and by such resolution, such shares of
Common Stock (including any Common Stock duly issued (i) upon the exchange
or conversion of any shares of Preferred Stock that are exchangeable or
convertible into Common Stock, (ii) upon the exercise of any Warrants
exercisable for Common Stock or (iii) upon the exchange or conversion of
Debt Securities that are exchangeable or convertible into Common Stock) will
be validly issued, fully paid and nonassessable.
3. The Company has the authority pursuant to the Certificate of
Incorporation to issue up to 1,000,000 shares of Preferred Stock. When a
series of Preferred Stock has been duly established in accordance with the
terms of the Certificate of Incorporation and applicable law, and upon
adoption by the Board of Directors of the Company of a resolution in form
and content as required by applicable law and upon issuance and delivery of
and payment for such shares in the manner contemplated by the Registration
Statement, the Prospectus and the related Prospectus Supplement(s) and by
such resolution, such shares of such series of Preferred Stock (including
any Preferred Stock duly issued (i) upon the exchange or conversion of any
shares of Preferred Stock that are exchangeable or convertible into another
series of Preferred Stock, (ii) upon the exercise of any Warrants
exercisable for Preferred Stock or (iii) upon the exchange or conversion of
Debt Securities
Grubb & Ellis Company
March 20, 1998
Page 3
that are exchangeable or convertible into Preferred Stock) will be validly
issued, fully paid and nonassessable.
4. When (a) the Warrants have been duly executed and delivered, and
issued and sold in the form and in the manner contemplated in the
Registration Statement, the Prospectus and the related Prospectus
Supplement(s), and (b) when the Registration Statement and any required
post-effective amendment thereto and any and all Prospectus Supplement(s)
required by applicable law have all become effective under the Securities
Act, and (c) assuming that the terms of the Warrants as executed and
delivered are as described in the Registration Statement, the Prospectus and
the related Prospectus Supplement(s), and (d) assuming that the Warrants, as
executed and delivered, do not violate any law applicable to the Company or
result in a default under or breach of any agreement or instrument binding
upon the Company, and (e) assuming the Warrants as executed and delivered
comply with all requirements and restrictions, if any, applicable to the
Company, whether imposed by any court or governmental or regulatory body
having jurisdiction over the Company, and (f) assuming that the Warrants are
then issued and sold as contemplated in the Registration Statement, the
Prospectus and the related Prospectus Supplement(s), the Warrants will
constitute valid and binding obligations of the Company, enforceable against
the Company in accordance with their terms.
The opinions set forth in Paragraphs 1 and 4 above are subject to the
following exceptions, limitations and qualifications: (i) the effect of
bankruptcy, insolvency, reorganization, moratorium or other similar laws now or
hereafter in effect relating to or affecting the rights and remedies of
creditors; (ii) the effect of general principles of equity, including without
limitation, concepts of materiality, reasonableness, good faith and fair dealing
and the possible unavailability of specific performance or injunctive relief,
regardless of whether enforcement is considered in a proceeding in equity or at
law, and the discretion of the court before which any proceeding therefor may be
brought; (iii) the unenforceability under certain circumstances under law or
court decisions of provisions providing for the indemnification of, or
contribution to, a party with respect to a liability where such indemnification
or contribution is contrary to public policy; (iv) we express no opinion
concerning the enforceability of any waiver of rights or defenses with respect
to stay, extension or usury laws; and (v) we express no opinion with respect to
whether acceleration of Debt Securities may affect the collectibility of any
portion of the stated principal amount thereof which might be determined to
constitute unearned interest thereon.
We assume for purposes of this opinion that the Company has been duly
incorporated and is validly existing as a corporation under the laws of the
State of Delaware and has the corporate power and authority to issue and sell
the Securities; that the applicable Indenture has been duly authorized by all
necessary corporate action by the Company, has been duly executed and delivered
by the Company and constitutes the legally valid, binding and enforceable
obligation of the Company enforceable against the Company in accordance with its
terms; that the Trustee for each Indenture is duly organized, validly existing
and in good standing under the laws of its jurisdiction of organization; that
the Trustee is duly qualified to engage in the activities contemplated by the
applicable Indenture; that the applicable Indenture has been duly authorized,
executed and delivered by the Trustee and constitutes a legally valid, binding
and enforceable obligation of the Trustee, enforceable against the Trustee in
accordance with its terms; that the Trustee is in compliance, generally and with
respect to acting as Trustee under the applicable Indenture, with all applicable
laws and regulations; and that the Trustee has the requisite organizational and
legal power and authority to perform its obligations under the applicable
Indenture.
We assume for purposes of this opinion that the warrant agent (the "Warrant
Agent") under the warrant agreement (the "Warrant Agreement") pursuant to which
the Warrants will be issued is duly organized, validly existing and in good
standing under the laws of its jurisdiction of organization; that the applicable
Warrant Agreement has been duly authorized, executed and delivered by the
Warrant Agent and constitutes a legally valid, binding and enforceable
obligation of the Warrant Agent, enforceable
Grubb & Ellis Company
March 20, 1998
Page 4
against the Warrant Agent in accordance with its terms; that the Warrant Agent
is in compliance, generally and with respect to acting as Warrant Agent under
the applicable Warrant Agreement, with all applicable laws and regulations; and
that the Warrant Agent has the requisite organizational and legal power and
authority to perform its obligations under the applicable Warrant Agreement.
We consent to your filing this opinion as an exhibit to the Registration
Statement and to the reference to our firm under the caption "Legal Matters" in
the Prospectus included therein.
This opinion is rendered only to you and is solely for your benefit in
connection with the transactions covered hereby. This opinion may not be relied
upon by you for any other purpose, or furnished to, quoted to, or relied upon by
any other person, firm or corporation for any purpose, without our prior written
consent.
Very truly yours,
/s/ LATHAM & WATKINS