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Registration No. 333-
SECURITIES AND EXCHANGE COMMISSION
FORM S-3
REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933
RESOURCE ASSET INVESTMENT TRUST
(Exact name of registrant as specified in its charter)
Maryland
(State or other jurisdiction of incorporation or organization)
23-2919819
(I.R.S. Employer Identification No.)
1845 Walnut Street, Philadelphia, Pennsylvania 19103 (215-861-7900)
(Address, including zip code, and telephone number, including area code,
of registrant's principal executive offices)
Ellen J. DiStefano, 1845 Walnut Street, Philadelphia, Pennsylvania 19103
(215-861-7900) (Name, address, including zip code, and telephone number,
including area code, of Administrator for service)
Copies to:
J. Baur Whittlesey, Esq.
Ledgewood Law Firm, P.C.
1521 Locust Street
Philadelphia, PA 19102
(215) 735-0663
Approximate date of commencement of proposed sale to the public: As soon as
practicable after this registration statement becomes effective.
If the only securities being registered on this Form are being offered pursuant
to dividend or interest reinvestment plans, please check the following box. [X]
If any of the securities being registered on this Form are to be offered on a
delayed or continuous basis pursuant to Rule 415 under the Securities Act of
1933, other than securities offered only in connection with dividend or interest
reinvestment plans, check the following box. [ ]
If this Form is filed to register additional securities for an offering pursuant
to Rule 462(b) under the Securities Act, please check the following box and list
the Securities Act registration statement number of the earlier effective
registration statement for the same offering. [ ]
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If this Form is a post-effective amendment filed pursuant to Rule 462(c) under
the Securities Act, check the following box and list the Securities Act
registration statement number of the earlier effective registration statement
for the same offering. [ ]
If delivery of the prospectus is expected to be made pursuant to Rule 434,
please check the following box. [ ]
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CALCULATION OF REGISTRATION FEE
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Title of each class Proposed Proposed maximum
of securities to be Amount to be maximum offering aggregate offering Amount of
registered registered price per unit(1) price registration fee
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Common Shares 500,000 $11.44 $5,720,000 $1,590.16
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(1) Estimated solely for purposes of calculating the registration fee in
accordance with Rule 457(c) under the Securities Act of 1933 based upon the
average of the high and low prices reported on the American Stock Exchange
on May 10, 1999.
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[LOGO]
PROSPECTUS
RESOURCE ASSET INVESTMENT TRUST
Dividend Reinvestment Plan
500,000 Common Shares of Beneficial Interest, $0.01 par value per share
We have established a Dividend Reinvestment Plan (the "Plan") to
promote long-term ownership in Resource Asset Investment Trust ("RAIT") by
offering Plan participants the opportunity to purchase common shares of
beneficial interest ("common shares") through reinvestment of dividends. The
principal advantage of participation in the Plan is that you can acquire common
shares without paying any service fees, brokerage commissions or other charges.
In order to fulfill its requirements, the Plan will purchase common
shares in the open market or from us. If the Plan purchases open market shares,
the price of the shares to Plan participants will be the weighted average price
of all shares purchased with respect to the relevant dividend reinvestment date.
The price of shares purchased from us will be the average of the daily high and
low sales prices for the shares on AMEX for the three business days preceding
the date the shares are purchased. However, whether the Plan purchases common
shares in the open market or from us, the price of the shares to Plan
participants will not be less than 95%, nor more than 100%, of the closing price
of the shares on the dividend payment date.
You may join the Plan by delivering a signed enrollment form to
American Stock Transfer & Trust Company, the administrator of the Plan (the
"Administrator"). An enrollment form has been sent to you with this prospectus.
Additional enrollment forms can be obtained by calling or writing the
Administrator or us. Participation in the Plan is strictly voluntary. At any
time, you may terminate your account and withdraw your common shares from the
Plan, subject to the terms outlined in this prospectus.
This prospectus relates up to 500,000 common shares offered for
purchase under the Plan. Please read the prospectus carefully and its
description of the Plan before you decide to join the Plan. You should keep this
prospectus for future reference.
Neither the Securities and Exchange Commission nor any state securities
commission has approved or disapproved these securities, or determined if this
prospectus is truthful or complete. Any representation to the contrary is a
criminal offense.
The date of this prospectus is May 14, 1999.
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WHERE YOU CAN FIND MORE INFORMATION
We file annual, quarterly and current reports, proxy statements and
other information with the SEC. You may read and copy any reports, statements or
other information that we filed with the SEC at the SEC's public reference room
at 450 Fifth Street, N.W., Washington, D.C. 20549. You may request copies of
these documents, upon payment of a copying fee, by writing to the SEC. Please
call the SEC at 1-800-SEC-0330 for information on the operation of the Public
Reference Room. Our SEC filings are also available to the public on the SEC
internet site at http://www.sec.gov.
You may also read and copy this information at the National Association
of Securities Dealers, Inc., 1735 K Street, N.W. Washington, D.C. 20006.
The SEC allows us to "incorporate by reference" the information we file
with it, which means that we can disclose important information to you by
referring you to documents we have filed with the SEC which are not included in
this prospectus. The information incorporated by reference is considered part of
this prospectus, and later information that we file with the SEC will
automatically update and replace this information. We incorporate by reference
the documents listed below and any future filings made with the SEC under
Section 12(a), 13(c), 14 or 15(d) of the Securities Exchange Act of 1934 (such
as Form 10-Q Quarterly Reports, Form 8-K Current Reports and proxy materials).
o Annual Report on Form 10-K for the year ended December 31, 1998; and
o The description of our common shares on Form 8-A, including any
amendment or report filed for the purpose of updating this
description.
You may request a copy of these filings, at no cost, by writing or
telephoning us at the following address:
Resource Asset Investment Trust
ATTN: Ellen J. DiStefano,
Vice President and Chief Financial Officer
1845 Walnut Street; 10th Flr.
Philadelphia, Pennsylvania 19103
(215) 861-7900
You should rely only on the information incorporated by reference or
provided in this prospectus or any supplement to this prospectus. We have not
authorized anyone else to provide you with different information. We are not
making an offer of these shares in any state where the offer is not permitted.
You should not assume that the information in this prospectus or any supplement
is accurate as of any date other than the date on the front of those documents.
The statements that we make in this prospectus about the contents of
any other documents are not necessarily complete, and are qualified in their
entirety by referring you to the copy of that document, which is filed as an
exhibit to the registration statement. You can obtain copies of these documents
from the SEC or from us, as described above.
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OUR BUSINESS
We are a real estate investment trust, a "REIT," that has three
principal business activities:
o We make mortgage loans directly to borrowers.
o We acquire mortgage loans from others.
o We acquire real properties or interests in real properties.
We seek to generate income for distribution to our shareholders from a
combination of interest, rents, distributions in respect of rents (where we own
an equity interest in the owner of the underlying real estate), proceeds from
appreciation interests (see below) and proceeds from the sale of portfolio
investments.
Direct Lending. We make real estate loans directly to borrowers whose
financing needs do not conform to the criteria established by institutional
lenders and lenders which provide funds through securitization of loans. We
attempt to adapt the terms of our direct loans to meet the particular needs of a
borrower. To meet these needs, we use a variety of techniques, such as staged
payments, event specific loan advances, different rates of interest payment and
accrual and deferred (or "balloon") principal payments.
Our direct loans will typically have some or all of the following
characteristics:
o The funds provided by us will be between $1 million and $10 million.
o The loans will be subordinated (or "mezzanine") financing secured by
junior mortgage liens on real property, including "wraparound" loans
(that is, loans whose principal amount includes, and is increased
by, the principal amount of all loans held by senior lenders).
o The real property securing the loans will be office, apartment or
other commercial buildings.
We attempt to include "participation" or "appreciation interest"
provisions in our loans. These provisions require a borrower to pay us a
percentage of any increase in the value of a property securing one of our loans
over the value of the property at the time the loan is made or over a value
agreed upon by us and the borrower. Alternatively, in some cases, these
provisions may require payment of a percentage of the increase in a property's
revenues over a stated revenue level (usually the level at the time the loan is
made). The measurement period typically ends at loan repayment. We attempt to
obtain appreciation interests at a rate of 25% or greater.
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We do not impose limitations on the types of direct loans we make. As a
result, our loans may not have the characteristics described in this section.
For example, we may make loans that are first lien loans, that are not
wraparound loans, that require investments of less than $1 million or greater
than $10 million or that either do not have participation features or have
participation rates substantially greater or less than 25%. We may also make
loans that are secured by indirect interests in real property. For example, we
may make a loan secured in part by equity interests in a partnership which
owns the property.
Mezzanine loans (including wraparound loans) offer the potential for
higher yields than those ordinarily obtained in senior lien financing (and, in
the case of wraparound loans, the possibility of increasing yields as the
principal amounts of senior loans are amortized). However, such loans carry
greater credit risk, including a substantially greater risk that the borrowers
will not repay interest or principal, than senior lien financing.
Loan Acquisition. We also acquire existing real property loans held by
banks, other institutional lenders or third-party investors. These loans will
generally require the same investment and involve the same kinds of underlying
properties and risks as our direct loans. We emphasize acquiring loans where the
acquisition price is less than both the outstanding balance of the loan and the
appraised value of the property underlying the loan. These discounts result from
past and current loan defaults by the borrower due to lack of a strong operating
history for the property underlying the loan, historical credit or cash flow
problems of the borrower or the underlying property, complex ownership
structures or other factors. We do not acquire discounted loans unless material
steps have been taken by the borrower, the previous owner of the loan or others
to resolve the past problems.
Property Ownership. We also acquire real property either directly or
indirectly through ownership of an interest in an entity that itself owns a real
property. These acquisitions will generally require the same amount of
investment as our loans and will involve the same kinds of properties. We
acquire properties to address the financial needs and tax situations of
borrowers in situations where debt financing may not be appropriate, or to
assist us in meeting federal income tax requirements pertaining to REITs.
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SUMMARY OF THE PLAN
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<S> <C>
Participation Existing RAIT shareholders can participate by
submitting a completed enrollment form. If your common shares
are held in a brokerage account, you may participate directly
by registering some or all of your shares in your name.
Alternatively, you can enroll your shares through your broker.
Reinvestment of Dividends You can reinvest all or a portion of your cash dividends
toward the purchase of additional common shares without
paying trading fees.
Full Investment Full investment of your dividends is possible because you
will be credited with both whole and fractional common
shares. RAIT pays dividends on both whole and fractional
common shares.
Safekeeping of Certificates You can deposit your common share certificates with American
Stock Transfer & Trust Company, the administrator of the
Plan, for safekeeping at no cost to you. A certificate for
your common shares will be sent to you, free of charge, upon
request. However, certificates for fractional shares will not
be issued.
Gifts or Transfers of Common Shares You can give or transfer your common shares to others.
Sell Common Shares Conveniently If you choose to sell the common shares held in your Plan
account, you will generally pay fees lower than those
typically charged by full service brokers. You may also
transfer your shares to your own brokerage account.
Tracking Your Account You will receive a quarterly statement showing all
transactions (number of shares, amount invested, purchase
price) for your account including year-to-date and other
account information.
Inquiries For information about the Plan, contact American Stock
Transfer & Trust Company, Attn: Dividend Reinvestment, 40
Wall Street, New York, NY 10005; telephone: 1-800-278-4353.
Plan Service Fees Enrollment fee: No charge
Reinvestment of dividends: No charge
Sale of common shares:
Transaction fee: $15.00
Trading fee: $.04 per share
Gift or transfer of
common shares: No charge
Safekeeping of certificates: No charge
Certificate issuance: No charge
Duplicate statements: No charge
</TABLE>
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THE PLAN
The following questions and answers constitute the Plan.
PARTICIPATION
1. Who is eligible to participate in the Plan?
You are eligible to participate in the Plan if you currently own RAIT common
shares and meet the requirements outlined below. If you live outside the
U.S., you should first determine if there are any governmental regulations
that would prohibit your participation in the Plan.
o If your RAIT common shares are registered in your name, you may join the
Plan by returning a completed enrollment form to American Stock Transfer
& Trust Company, the Plan administrator. If your common shares are
registered in more than one name (such as joint tenants, trustees, etc.),
all registered holders must sign the enrollment form.
o If your common shares are held in a brokerage, bank or other intermediary
account, and you wish to participate directly in the Plan, you should ask
your broker, bank or trustee to register some or all of your common
shares directly in your name. You can then join the Plan by returning a
completed enrollment form to American Stock Transfer & Trust Company.
Alternatively, your common shares can be enrolled through your broker.
Contact your broker directly to obtain details.
Your Plan account will be composed of:
o Common shares you hold in certificated form.
o Common shares held by the Administrator in book entry form on your
behalf, which will include:
[ ] Common shares you deposit with the Administrator for safekeeping
(see Question 13 below).
[ ] Common shares purchased with your reinvested dividends (see
Question 12 below).
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2. When can I join the Plan?
You can join the Plan at any time. The Administrator will use reinvested
dividends to purchase common shares on a quarterly basis. Purchases may be
made over a number of days to meet the requirements of the Plan.
3. What are the advantages of participation in the Plan?
o You will not pay any service fees, brokerage commissions or other charges
in connection with purchases of common shares under the Plan.
o Funds in the Plan are fully invested through the purchase of fractions of
common shares, as well as full common shares. Proportionate cash
dividends on fractions of common shares are used to purchase additional
common shares.
o The Plan offers a "share safekeeping" service under which you may deposit
your common share certificates with the Administrator who will maintain
your common shares on its records as part of its Plan accounts. You will
not be charged a fee for this service.
4. What are the disadvantages of participation in the Plan?
o You will be treated for federal income tax purposes as having received a
dividend on the dividend payment date. These dividends may give rise to a
tax payment obligation without providing you with immediate cash to pay
such tax when it becomes due. See "Tax Consequences" below.
o You will not be able to control the specific timing of purchases and
sales of common shares under the Plan, and thus will not be able to
control the price of common shares purchased or sold on your behalf.
o No interest will be paid by us or the Administrator on any cash amounts
held in a Plan account, including dividends held pending investment and,
where a participant has elected partial dividend reinvestment, the amount
of any cash dividend being paid out to him or her.
5. Do I have to invest all my dividends under the Plan?
No. The Plan provides two investment options:
o Full Dividend Reinvestment: The Administrator will apply cash dividends
on all common shares held in your Plan account (that is, all shares held
by you in certificated form and all shares held for you in book entry
form by the Administrator; see Question 1 above) toward the purchase of
additional common shares.
o Partial Dividend Reinvestment: The Administrator will apply cash
dividends on a specified number of common shares held by you in
certificated form, and all cash dividends on common shares held for you
in book entry form by the Administrator, toward the purchase of
additional common shares.
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DIVIDEND REINVESTMENT
6. When will dividends be reinvested toward the purchase of additional common
shares?
The timing of purchases for the Plan will depend on whether we have decided
to purchase newly issued common shares or to purchase common shares in the
open market (or a combination of newly issued and open market shares). Newly
issued shares will be purchased on the first business day after each
dividend payment date. Open market purchases will generally begin on the
first business day after the dividend payment date and continue for two to
five business days (but up to 30 days) after the dividend payment date.
7. How and when can I change the amount of dividends to be reinvested?
You may change your dividend reinvestment instructions at any time by
submitting a newly executed enrollment form to the Administrator or by
writing to the Administrator. The Administrator must receive written
instructions changing the number of common shares with respect to which it
is authorized to reinvest dividends before the record date for payment of
the dividend. The record date for the payment of dividends is usually
approximately 10 days before the dividend payment date. We will publicly
announce both the record date and the dividend payment date.
PURCHASING COMMON SHARES THROUGH THE PLAN
8. What is the source of common shares to be purchased under the Plan?
RAIT common shares used to meet the Plan's requirements will either be
purchased in the open market by the Administrator or issued directly by us
from unissued shares or treasury shares. We intend to use the proceeds from
any newly issued shares or treasury shares for general business purposes.
9. What is the price of common shares purchased under the Plan?
o Shares purchased from RAIT: If the common shares are purchased from RAIT,
the price of those shares will be the average of the daily high and low
sales prices of common shares on AMEX (or any other securities exchange
on which the common shares are then traded) for the 3 business days
preceding the date the shares are purchased.
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o Shares purchased in the open market: If common shares are purchased on
the open market, the price of those shares will be the weighted average
price of all shares purchased for the Plan over the period of days the
purchases are made.
However, whether the Plan purchases common shares in the open market or from
us, the price of the shares to Plan participants will not be less than 95%,
nor more than 100%, of the closing price of the shares on the dividend
payment date. Your account will be credited with the number of shares,
including fractions calculated to three decimal places, equal to your total
funds available for investment divided by the per share purchase price.
10. What costs are associated with investments in the Plan?
We will pay all costs of administration of the Plan. We will also pay all
brokerage commissions incurred for open market purchases made by the Plan.
(Your pro rata portion of these fees will be reported to you as taxable
income. See "Tax Consequences" below.)
SELLING COMMON SHARES THROUGH THE PLAN
11. How can I sell my shares held in the Plan?
You can sell any number of common shares held in your Plan account by
notifying the Administrator. The written notification to the Administrator
must include the number of common shares that are to be sold. Any request
that does not clearly indicate the number of shares to be sold will be
returned to you with no action taken. Sales will be made by the
Administrator at least weekly, but may be made more frequently if volume
dictates. The sale price for shares sold will be the weighted average price
of shares sold during that period. You will receive the proceeds of the
sale, less a $15.00 transaction charge, $.04 per share trading fee and any
required tax withholdings.
You can choose to sell your shares through a stockbroker of your choice, in
which case you should ask the Administrator to issue you a certificate for
the shares you wish to sell.
Neither you nor we will have the authority or power to control the timing or
pricing of common shares sold or the selection of the broker/dealer making
the sale. Therefore, you will not be able to precisely time sales and will
bear the market risk associated with fluctuations in the price of the common
shares.
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CUSTODIAL SERVICE AND SHARE SAFEKEEPING
12. How does the custodial service work?
All common shares that you buy under the Plan will be maintained in your
Plan account for safekeeping in book entry form. You will receive a periodic
statement detailing the status of your holdings. See "Plan Administration"
below.
13. How does the share safekeeping service work?
You may use the Plan's share safekeeping service to deposit any common share
certificates in your possession with the Administrator. You will not be
charged a fee for this service. Common shares deposited will be transferred
into the name of the Administrator or its nominee and credited to your
account under the Plan.
By using the Plan's share safekeeping service, you no longer bear the risk
associated with loss, theft or destruction of share certificates. Also,
because common shares deposited with the Administrator are treated in the
same manner as common shares purchased through the Plan, they may be
transferred or sold through the Plan in a convenient and efficient manner.
Dividends on all shares deposited for safekeeping will be reinvested in
common shares.
To use the safekeeping service, send your certificates to the Administrator,
by registered, insured mail, with written instructions to deposit them in
safekeeping to the Administrator. The certificates should not be endorsed
and the assignment section should not be completed.
GIFTS OR TRANSFERS OF COMMON SHARES
14. Can I transfer or give common shares held in the Plan?
You can give or transfer common shares to anyone you choose by transferring
shares from your account to the recipient. Transfers must be made in whole
shares unless you transfer your entire account. Shares can be transferred to
new or existing RAIT shareholders. You can make a transfer by sending a
written request to the Administrator, together with an executed share
assignment (stock power). In order to ensure that the individual signing the
authorization papers or certificate(s) is in fact the registered owner, your
signature must be guaranteed by a commercial bank or broker.
All new accounts opened will automatically be enrolled as full dividend
reinvestment accounts; the recipient may change the reinvestment election at
his or her discretion.
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ISSUANCE OF CERTIFICATES/PARTIAL WITHDRAWALS
15. Will certificates be issued for common shares purchased?
Certificates for common shares purchased by the Plan will not be issued
unless a written request is made to the Administrator. This service protects
against loss, theft or destruction of certificates.
16. How do I request a certificate issuance?
You may request a share certificate for any or all of the whole common
shares held in your Plan account by contacting the Administrator in writing.
Certificates will be issued for whole shares only. In the event your request
involves a fractional share, a check (less any applicable fees) for the
value of the fractional share will be mailed to you. There is no charge for
certificate issuances.
Certificates will be issued in the name(s) in which the account is
maintained, unless otherwise instructed in writing. If a certificate is to
be issued in another name, you must provide the Administrator with signed
written instructions (with signature(s) guaranteed by a commercial banker or
broker).
Issuance of a certificate for common shares constitutes a withdrawal of
those common shares from your Plan account. If you selected the full
dividend reinvestment option, dividends on those shares will not be
reinvested under the Plan.
TERMINATIONS
17. How do I terminate my Plan account?
You may terminate your Plan account by so notifying the Administrator in
writing. After receipt of a notice of termination, dividends with respect to
the withdrawn common shares will be sent to you in the usual manner. You may
re-enroll in the Plan at any time.
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18. When will a termination notice be effective?
A termination notice will be effective upon receipt by the Administrator,
providing the notice is received at least two business days prior to the
record date for a dividend. If a termination notice is not timely received
by the Administrator, your termination will be effective the day after the
dividend payment date.
19. How are shares distributed upon termination?
You will receive a certificate for all whole common shares held in your Plan
account. Alternatively, you may request in the termination notice that some
or all of the common shares be sold. Any fractional shares will be converted
to cash at a price equal to the then current market price at which common
shares are sold in the open market on the date of that conversion.
TAX CONSEQUENCES
20. What are the U.S. federal income tax consequences of participation in the
Plan?
The following is a summary of the general U.S. federal income tax
consequences for individuals participating in the Plan. This summary is not
a comprehensive summary of all the U.S. federal income tax considerations
that may be relevant to a participant in the Plan. Therefore, you are urged
to consult your tax adviser regarding the consequences of participation in
the Plan, including state income tax consequences.
o Reinvested Dividends and Plan Expenses: Cash distributions reinvested
under the Plan will be taxable as having been received by you even though
you have not actually received them in cash. In addition, your
proportionate amount of brokerage commissions paid by us in connection
with open market purchases of common shares will be treated as an
additional distribution You will receive an annual statement from the
Administrator indicating the amount of reinvested dividends reported to
the IRS as dividend income. This statement will also report as taxable
income any trading fees paid by us on your behalf for purchases of common
shares. You should not be treated as receiving an additional taxable
distribution relating to your pro rata share of those fees of the
Administrator or other costs of administering the Plan which we pay.
There is no assurance, however, that the IRS will concur with this
position. We do not currently intend to seek formal advice from the IRS
on this issue.
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o Transfer of Common Shares: You will not realize gain or loss for U.S.
federal income tax purposes upon the transfer of common shares to the
Plan or the withdrawal of those shares from the Plan. You will, however,
generally realize gain or loss upon the sale of shares (including the
receipt of cash for fractional shares) held in the Plan.
o Withholding: Plan participants who are non-resident aliens or non-U.S.
corporations, partnerships or other entities generally are subject to a
withholding tax on dividends paid on common shares held in the Plan. The
Administrator is required to withhold from dividends paid the appropriate
amount determined in accordance with U.S. Treasury regulations. Any
applicable withholding tax may be determined by treaty between the U.S.
and the country in which such participant resides. Accordingly, the
amount of any dividends, net of applicable withholding tax, will be
credited to Plan accounts.
PLAN ADMINISTRATION
21. How will the Plan be administered?
American Stock Transfer & Trust Company, our Administrator, or a successor
selected by us, will administer the Plan, keep records, send statements of
account to participants, answer questions and perform other duties related
to the Plan.
22. Whom should I contact for answers to questions regarding the Plan?
All inquiries regarding the Plan should be sent to:
American Stock Transfer & Trust Company
Attn: Dividend Reinvestment
40 Wall Street
New York, NY 10005
Telephone: 1-800-278-4353
23. What kind of reports will I receive?
A statement of account will be sent by the Administrator as soon as
practicable after each purchase for your account. These statements should be
retained to establish the cost basis for income tax and other purposes of
shares purchased under the Plan. You will also receive prompt written
confirmation of any sales you request the Administrator to make.
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In addition, you will receive all communications sent to our other
shareholders, including any annual and quarterly reports to shareholders,
proxy statements and dividend income information for tax reporting purposes.
24. What are the liabilities of the Administrator and you under the Plan?
In administering the Plan, we and the Administrator (and any of our
respective agents, employees, officers, directors, trustees or
subcontractors) will not be liable for any act done in good faith or for any
good faith omission to act. This includes any claim of liability as follows:
o arising with respect to the prices or times at which common shares are
purchased or sold for your Plan account; or
o arising from any fluctuation in the market value after purchase or sale
of shares; or
o arising out of failure to terminate your account upon your death before
receiving written notice of your death.
We and the Administrator (and all of our respective agents, employees,
officers, directors, trustees or subcontractors) will not have any duties,
responsibilities or liabilities except such as are expressly set forth in
the Plan. We specifically disclaim any responsibility for any of the
Administrator's actions or inactions in connection with the administration
of the Plan. The foregoing does not represent a waiver of any rights you may
have under applicable securities laws.
Neither we nor the Administrator can assure you a profit or protect you
against a loss on the common shares you purchase under the Plan.
ADDITIONAL INFORMATION
25. Can I pledge or assign common shares held in the Plan?
Except for transfers described above, shares held in the Plan may not be
pledged or assigned, and any purported pledge or assignment will be void.
Accordingly, if you wish to pledge or assign common shares, you must request
that a certificate for the shares be issued in your name. We will not issue
certificates for fractional shares.
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26. How will common shares held in the Plan be voted at shareholders' meetings?
You will be sent proxy materials including a proxy card representing both
the shares for which you hold certificates and the shares, full and
fractional, in your Plan account. The proxy will be voted as indicated by
you. If the proxy card is not returned or if it is returned unsigned, none
of your shares will be voted.
27. What happens if you issue a common share dividend, declare a common share
split or have a common share rights offering?
Any dividends in common shares or split shares we distribute on common
shares held in the Plan will be added to your account. Common share
dividends or split shares distributed on common shares held outside the Plan
will also be credited to your account, unless you instruct the Administrator
otherwise.
In the event of a rights offering, you will receive rights based upon the
total number of whole common shares owned, that is, the total number of
common shares standing in your name both in the Plan and outside the Plan.
28. What happens if reinvestment of my distributions would cause me or any other
person to exceed the Ownership Limitation set forth in your Declaration of
Trust, or would otherwise violate the Declaration of Trust?
Our Declaration of Trust limits the actual and constructive ownership of
common shares by any one person to 8.3% of the outstanding shares, with
certain exceptions (the "Ownership Limitation"). To the extent any transfer
of common shares or reinvestment of dividends elected by a shareholder would
cause that shareholder or any other person to exceed the Ownership
Limitation or otherwise violate the Declaration of Trust, the transfer or
reinvestment will be void. Instead, that shareholder will be entitled to
receive cash distributions (without interest) in lieu of the reinvestment.
29. May the Plan be changed or discontinued?
We may amend, suspend or terminate the Plan at any time. You will receive
notice of any such amendment, suspension or termination. You will be deemed
to have accepted any such change to the Plan unless you terminate your Plan
account. Any amendment to the Plan may include an appointment of a successor
Administrator in place of the current Administrator under the terms and
conditions set forth in the Plan. In such event, we are authorized to pay to
that successor all dividends and distributions payable on common shares held
by you under the Plan for application by the successor as provided in the
Plan. Any change to the Plan will not have any retroactive effect that would
prejudice the interests of the Plan participants.
17
<PAGE>
In addition, we reserve the right to terminate your participation in the
Plan for any reason after written notice in advance mailed to the address
appearing on the Administrator's records.
30. What happens to my common shares if the Plan is discontinued or my account
is terminated?
In the event of termination of the Plan, you will receive certificates for
whole common shares held by you together with a check for the value of any
fractional shares, based on the current market price at which of the common
shares are sold in the open market on the date of termination of the Plan.
31. What happens if I die or become incompetent?
Participation in the Plan will be immediately terminated if the
Administrator receives written notice of your death or adjudicated
incompetency, together with satisfactory supporting documentation of the
appointment of a legal representative, at least five business days before
the next share purchase date. Otherwise, common shares will be purchased for
you with the related cash dividend and participation in the Plan will
terminate.
32. What law governs the Plan?
The terms and conditions of the Plan and its operation will be governed by
the internal laws of the Commonwealth of Pennsylvania, without regard to
otherwise applicable principles of conflicts of law.
33. How is the Plan to be interpreted?
We will determine any question of interpretation arising under the Plan and
any such determination will be final.
18
<PAGE>
EXPERTS
Our consolidated financial statements and related financial statement
schedules as of December 31, 1998 and for the year ended December 31, 1998 and
for the period from August 20, 1997 (date of inception) through December 31,
1997, incorporated by reference in this prospectus, having been audited by Grant
Thorton LLP, independent certified public accountants, whose report thereon
appears therein, and in reliance upon such report of Grant Thorton LLP, given
upon the authority as experts in accounting and auditing.
LEGAL MATTERS
Certain legal matters will be passed upon for RAIT by Ledgewood Law
Firm, P.C.
19
<PAGE>
PART II
INFORMATION NOT REQUIRED IN PROSPECTUS
Item 14. Other Expenses of Issuance and Distribution
All of the expenses set forth below, except the SEC registration fee,
are estimated.
SEC registration fee $ 1,590.16
Printing and engraving expenses 7,500.00
Accounting fees and expenses 5,000.00
Legal fees and expenses 12,000.00
Administrator fees 5,000.00
Miscellaneous 5,000.00
---------
Total $36,090.16
- ------------
All of the above are estimated, except the SEC registration fee.
Item 15. Indemnification of Directors and Officers
Maryland law permits a Maryland REIT to include in its trust agreement
a provision limiting the liability of its trustees and officers to the trust and
its shareholders for money damages except for liability resulting from (a)
actual receipt of an improper benefit or profit in money, property or services
or (b) active and deliberate dishonesty established by a final judgment as being
material to the cause of action. The Declaration of Trust of Resource Asset
Investment Trust (the "Company") contains such a provision which eliminates such
liability to the maximum extent permitted by Maryland law.
The Declaration of Trust of the Company authorizes the Company, to the
maximum extent permitted by Maryland law, to obligate itself to indemnify and to
pay or reimburse reasonable expenses in advance of final disposition of a
proceeding to (1) any present or former trustee or officers or (2) any
individual who, while a trustee of the Company and at the request of the
Company, serves or has served another corporation, partnership, joint venture,
trust, employee benefit plan or other enterprises from and against any claim or
liability to which such person may become subject or which such person may incur
by reason of his status as a present or former trustee or officer of the
Company. The Declaration of Trust of the Company obligates the Company, to the
20
<PAGE>
maximum extent permitted by Maryland law, to indemnify and to pay or reimburse
reasonable expenses in advance of final disposition of a proceeding to (1) any
present or former trustee or officer who is made a party to the proceeding by
reason of his service in that capacity or (2) any individual who, while a
trustee of the Company and at the request of the individual who, while a trustee
of the Company and at the request of the Company, serves or has served as an
officer, director, trustee, partner or otherwise in another corporation,
partnership, joint venture, trust, employee benefit plan or other enterprises
and who is made a party to the proceeding by reason of his service in that
capacity.
Maryland law requires a REIT (unless its trust agreement provides
otherwise, which the Company's Declaration of Trust does not) to indemnify a
trustee or officer who has been successful, on the merits or otherwise, in the
defense of any proceeding to which he is made a party by reason of his service
in that capacity. Maryland law permits a REIT to indemnify its present and
former trustees and officers, among others, against judgments, penalties, fines,
settlements and reasonable expenses actually incurred by them in connection with
any proceeding to which they may be made a party by reason of their service in
those or other capacities unless it is established that (1) the act or omission
of the trustee or officer was material to the matter giving rise to the
proceeding and (i) was committed in bad faith or (ii) was the result of active
and deliberate dishonesty, (2) the trustee or officer actually received an
improper personal benefit in money, property or services or (3) in the case of
any criminal proceeding, the trustee or officer had reasonable cause to believe
that the act or omission was unlawful. However, a Maryland REIT may not
indemnify for an adverse judgment in a suit by or in the right of the trust or
for a judgment of liability on the basis that personal benefit was improperly
received, unless in either case a court orders indemnification and then only for
expenses. In addition, Maryland law requires the Company, as a condition to
advancing expenses, to obtain (1) a written affirmation by the trustee or
officer of his good faith belief that he has met the standard of conduct
necessary for indemnification by the Company and (2) a written statement by or
on his behalf to repay the amount paid or reimbursed by the Company if it shall
ultimately be determined that the standard of conduct was not met.
In addition, the Company has entered into Indemnity Agreements with
its officers and trustees.
21
<PAGE>
Item 16. Exhibits
(a) Exhibits
Exhibit
Number
*4.1 -- Declaration of Trust, as amended, of Resource Asset Investment
Trust
*4.2 -- Bylaws, as amended, of Resource Asset Investment Trust
*4.3 -- Form of specimen certificate representing common shares
5 -- Opinion regarding validity of securities being registered
8 -- Opinion regarding tax matters
23.1 -- Consent of Grant Thornton LLP
23.2 -- Consent of Ledgewood Law Firm, P.C. (included in Exhibits 5
and 8)
24 -- Power of Attorney (included on signature page)
99 -- Enrollment Form
- ----------------
*Incorporated herein by reference to Resource Asset Investment Trust's
Registration Statement on Form S-11 (File No. 333-35077), as amended.
Item 17. Undertakings
The undersigned registrant hereby undertakes: (1) to file, during any
period in which offers or sales are being made, a post-effective amendment to
this registration statement to include any material information with respect to
the plan of distribution not previously disclosed in the registration statement
or any material change to such information in the registration statement; (2)
for the purpose of determining any liability under the Securities Act, each
post-effective amendment that contains a form of prospectus shall be deemed to
be a new registration statement relating to the securities offered therein, and
the offering of such securities at that time shall be deemed to be the initial
bona fide offering thereof; and (3) to remove from registration by means of a
post-effective amendment any of the securities being registered which remain
unsold at the termination of the offering.
The undersigned registrant also hereby undertakes that, for purposes of
determining any liability under the Securities Act of 1933, each filing of the
registrant's annual report pursuant to Section 13(a) or Section 15(d) of the
Securities Exchange Act of 1934 that is incorporated by reference in the
registration statement shall be deemed to be a new registration statement
relating to the securities offered therein, and the offering of such securities
at that time shall be deemed to be the initial bona fide offering thereof.
22
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, as amended,
the registrant certifies that it has reasonable grounds to believe that it meets
the requirements for filing on Form S-3 and has duly caused this registration
statement to be signed on its behalf by the undersigned, thereunto duly
authorized, in the City of Philadelphia, Commonwealth of Pennsylvania, on the
13th day of May, 1999.
RESOURCE ASSET INVESTMENT TRUST
By: /s/ Betsy Z. Cohen
----------------------------
Betsy Z. Cohen
Chairman of the Board and
Chief Executive Officer
23
<PAGE>
POWER OF ATTORNEY
KNOW ALL PERSONS BY THESE PRESENTS, that each person whose signature
appears below constitutes and appoints Betsy Z. Cohen, Jay Eisner and Ellen J.
DiStefano, or any of them, as his or her true and lawful attorney-in-fact and
agent, with full power of substitution and resubstitution, for him or her and in
his or her name, place, and stead, in any and all capacities, to sign any and
all amendments (including post-effective amendments) to this Registration
Statement, and to file the same, with all exhibits thereto, and other documents
in connection therewith, with the Securities and Exchange Commission, granting
unto said attorney-in-fact and agent full power and authority to do and perform
each and every act and thing requisite and necessary to be done in connection
therewith as fully to all intents and purposes as he or she might or could do in
person, hereby ratifying and confirming all that said attorney-in-fact and
agent, or of his or her substitute or substitutes, may lawfully do or cause to
be done by virtue hereof.
Pursuant to the requirements of the Securities Act of 1933, as amended,
this registration statement has been signed by the following persons in the
capacities and on the dates indicated.
<TABLE>
<CAPTION>
<S> <C> <C>
/s/ Betsy Z. Cohen Chairman, Chief Executive May 13, 1999
- ----------------------------------- Officer and Trustee
Betsy Z. Cohen (Principal Executive Officer)
/s/ Jay J. Eisner President and Chief Operating May 13, 1999
- ----------------------------------- Officer
Jay J. Eisner
/s/ Ellen J. DiStefano Vice President and Chief May 13, 1999
- ----------------------------------- Financial Officer
Ellen J. DiStefano
/s/ Jonathan Z. Cohen Trustee May 13, 1999
- -----------------------------------
Jonathan Z. Cohen
/s/ Joel R. Mesznik Trustee May 13, 1999
- -----------------------------------
Joel R. Mesznik
/s/ Daniel Promislo Trustee May 13, 1999
- -----------------------------------
Daniel Promislo
/s/ Jack L. Wolgin Trustee May 13, 1999
- -----------------------------------
Jack L. Wolgin
</TABLE>
24
<PAGE>
Exhibit 5
May 14, 1999
Resource Asset Investment Trust
1845 Walnut Street
Philadelphia, PA 19103
Re: Resource Asset Investment Trust Dividend Reinvestment Plan
Registration Statement on Form S-3
Ladies and Gentlemen:
We have acted as counsel for Resource Asset Investment Trust (the
"Company") in connection with (i) the proposed issuance by the Company from time
to time of up to 500,000 additional common shares (the "Common Shares") under
the Resource Asset Investment Trust Dividend Reinvestment Plan (the "Plan"),
(ii) the preparation of the Section 10(a) prospectus for the Plan and (iii) the
preparation of the Company's Registration Statement on Form S-3 with respect to
the Common Shares (the "Registration Statement"), to be filed with the
Securities and Exchange Commission and with which this opinion is to be filed as
an exhibit. This opinion is being furnished pursuant to the requirements of Form
S-3 and Item 601 of Regulation S-K under the Securities Act of 1933, as amended
(the "Act").
In furnishing this opinion, we have examined the Registration
Statement, the prospectus for the Plan and such other documents, corporate and
other records of the Company, and certificates of public officials and officers
of the Company as we have deemed necessary or appropriate to provide a basis for
the opinions set forth below. In such examination, we have assumed the
genuineness of all signatures, the authenticity of all documents submitted to us
as originals and the conformity to original documents of all documents submitted
to us as certified or photostatic copies.
25
<PAGE>
Based upon and subject to the foregoing, we are of the opinion that:
1. The Company has been duly formed and is validly existing as a
business trust under the laws of the State of Maryland;
2. The Registration Statement has been duly authorized by all necessary
action on the part of the Company; and
3. The Common Shares, when issued and delivered as contemplated by the
Plan and the Registration Statement, will be duly authorized, validly issued,
fully paid and non assessable.
We hereby consent to the filing of this opinion as an exhibit to the
Registration Statement. We also consent to the reference to Ledgewood Law Firm,
P.C. under the caption "Legal Matters" in the Prospectus. In giving this
consent, we do not admit that we are in the category of persons whose consent is
required by Section 7 of the Securities Act of 1933, as amended, or the rules
and regulations promulgated thereunder by the Securities and Exchange
Commission.
Very truly yours,
/s/ Ledgewood Law Firm, P.C.
LEDGEWOOD LAW FIRM, P.C.
26
<PAGE>
Exhibit 8
May 14, 1999
Resource Asset Investment Trust
1845 Walnut Street, 10th Floor
Philadelphia, PA 19103
Ladies and Gentlemen:
We have acted as counsel to Resource Asset Investment Trust, a Maryland
real estate investment trust (the "Company"), in connection with the preparation
of a Form S-3 registration statement (the "Registration Statement"), filed with
the Securities and Exchange Commission, with respect to the offering and sale
(the "Offering") of up to 500,000 common shares of beneficial interest, par
value $.0.01 per share of the Company (the "Common Shares"). You have requested
our opinion regarding certain U.S. federal income tax matters in connection with
the Offering.
In giving this opinion letter, we have examined the following:
1. The Company's Declaration of Trust, as duly filed with the Secretary
of the State of the State of Maryland on August 14, 1997;
2. The Company's Restated and Amended Declaration of Trust, as duly
filed with the Secretary of State of the State of Maryland on November 19, 1997
and as amended by the Articles of Amendment and Restated Declaration of Trust,
duly filed with the Secretary of State of the State of Maryland on January 7,
1998;
3. The Company's Bylaws;
4. The Registration Statement, including the prospectus contained as
part of the Registration Statement (the "Prospectus"); and
5. Such other documents as we have deemed necessary or appropriate for
purposes of this opinion.
27
<PAGE>
In connection with the opinions rendered below, we have assumed that
each of the documents referred to above has been duly authorized, executed, and
delivered; is authentic, if an original, or is accurate, if a copy, and has not
been amended.
Based on the documents and assumptions set forth above, and the
discussion in the Prospectus under the caption "Tax Consequences" (which is
incorporated herein by reference), we are of the opinion that the descriptions
of the law and the legal conclusions contained in the Prospectus under the
caption "Tax Consequences" are correct in all material respects, and the
discussion thereunder fairly summarizes the federal income tax considerations
that are likely to be material to a purchaser of Common Shares in the Offering.
We hereby consent to the filing of this opinion as an exhibit to the
Registration Statement. We also consent to the reference to Ledgewood Law Firm,
P.C. under the caption "Legal Matters" in the Prospectus. In giving this
consent, we do not admit that we are in the category of persons whose consent is
required by Section 7 of the Securities Act of 1933, as amended, or the rules
and regulations promulgated thereunder by the Securities and Exchange
Commission.
The foregoing opinions are limited to the U.S. federal income tax
matters addressed herein, and no other opinions are rendered with respect to
other federal tax matters or to any issues arising under the tax laws of any
other country, or any state or locality. We undertake no obligation to update
the opinions expressed herein after the date of this letter.
Very truly yours,
/s/ Ledgewood Law Firm, P.C.
LEDGEWOOD LAW FIRM, P.C.
28
<PAGE>
Exhibit 23.1
CONSENT OF INDEPENDENT CERTIFIED PUBLIC ACCOUNTANTS
We have issued our report dated January 25, 1999 accompanying the
consolidated financial statements of Resource Asset Investment Trust and
subsidiaries appearing in the 1998 Annual Report of the Trust to its
shareholders and included in the Annual Report on Form 10-K for the year ended
December 31, 1998 which are incorporated by reference in this Registration
Statement and Prospectus. We consent to the incorporation by reference in the
Registration Statement and Prospectus of the aforementioned report and to the
use of our name as it appears under the caption "Experts."
/s/ Grant Thornton LLP
- ----------------------------
Philadelphia, Pennsylvania
May 14, 1999
29
<PAGE>
EXHIBIT 99
RESOURCE ASSET INVESTMENT TRUST
Dividend Reinvestment Plan (the "Plan")
Enrollment Form
Please print all items except signatures. QUESTIONS? Call American Stock
Transfer & Trust Company (the "Administrator") toll-free at 1-800-278-4353. Mail
your completed Enrollment Form in the courtesy envelope provided.
If your common shares are being held by your broker and you wish to participate
in the Plan directly, ask your broker to register some or all of your common
shares in your name. Alternatively, your common shares can be enrolled through
your broker. Contact your broker for details.
A. YOUR MAILING ADDRESS
Please provide your mailing address below. We must have a complete address to
process your enrollment.
________________________________________________________________________________
First Name M.I. Last Name
________________________________________________________________________________
Address Apartment Number
________________________________________________________________________________
City State Zip Code Country
Please provide your day and evening phone numbers to assist us in
processing your enrollment.
Daytime Phone: ( )________
Evening Phone: ( )________
30
<PAGE>
B. INVESTMENT OPTION
You may choose to reinvest all, part or none of the dividends paid on common
shares held by you outside the Plan. Please check one of the following boxes and
provide the requested information.
[ ] FULL DIVIDEND REINVESTMENT: The Administrator will apply cash dividends on
all common shares held in your Plan account toward the purchase of
additional common shares.
[ ] PARTIAL DIVIDEND REINVESTMENT: The Administrator will apply cash dividends
on the following whole number of common shares held by you in certificated
form, and cash dividends on common shares held for you in book entry form by
the Administrator, toward the purchase of additional common shares:
______ common shares.
C. YOUR ACCOUNT REGISTRATION Please Print Clearly
[ ] INDIVIDUAL OR JOINT. Joint accounts will be presumed to be joint tenants
unless restricted by applicable state law or otherwise indicated. Only one
Social Security number is required for tax reporting.
________________________________________________________________________________
Owner's First Name M.I. Last Name
________________________________________________________________________________
Owner's Social Security No.
________________________________________________________________________________
Joint Owner's First Name M.I. Last Name
[ ] CUSTODIAL. A minor is the beneficial owner of the account with an adult
custodian managing the account until the minor becomes of age, as specified
in the Uniform Gifts/Transfers to Minors Act in the minor's state of
residence.
________________________________________________________________________________
Custodian's First Name M.I. Last Name
31
<PAGE>
________________________________________________________________________________
Minor's First Name M.I. Last Name
________________________________________________________________________________
Minor's Social Security No. Minor's State of Residence
[ ] TRUST. Account is established in accordance with provisions of trust
agreement.
________________________________________________________________________________
Trustee Name Name of Trust Trust Date
________________________________________________________________________________
Tax ID No. Beneficiary
[ ] CORPORATION, PARTNERSHIP or OTHER ENTITY.
________________________________________________________________________________
Business Name Tax ID No.
PLEASE BE SURE TO COMPLETE AND SIGN THIS FORM.
D. SAFEKEEPING
Common share certificates deposited for safekeeping in your account must be
in the same registration as your Plan account. Dividends on all shares
deposited for safekeeping will be reinvested.
[ ] Please accept the enclosed certificate(s) for deposit to my account.
Certificate number(s) Number of shares
____________________________ __________________________
____________________________ __________________________
____________________________ __________________________
Number of certificates:_____ Total:_____
32
<PAGE>
E. ACCOUNT AUTHORIZATION SIGNATURE/SUBSTITUTE FORM W-9/W-8 (REQUIRED)
<TABLE>
<CAPTION>
<S> <C>
[ ] REQUEST FOR TAXPAYER IDENTIFICATION NUMBER [ ] CERTIFICATE OF FOREIGN STATUS
(Substitute Form W-9) (Substitute Form W-8)
I am a U.S. citizen or a resident alien. I certify, I am an exempt citizen. I certify, under penalties of
under penalties of perjury, that the Taxpayer perjury, that I am not a U.S. citizen or resident alien
Identification or Social Security number in Section C (or I am filing for a foreign corporation, partnership,
is correct (or I am waiting for a number to be issued estate, or trust) and I am an exempt foreign person. I
to me). Cross out the following if not true: I am not have entered in Section C of this enrollment form the
subject to backup withholding because: (a) I am country where I reside permanently for income-tax
exempt from backup withholding, or (b) I have not purposes.
been notified by the Internal Revenue Service that I
am subject to backup withholding as a result of [ ] FOR ORGANIZATIONS AND BUSINESS ENTITIES EXEMPT FROM
failure to report all interest or dividends, or (c) BACKUP WITHHOLDING
the IRS has notified me that I am no longer subject
to backup withholding. I qualify for exemption and my account will not be
subject to tax reporting and backup withholding.
</TABLE>
THE SIGNATURE(S) BELOW INDICATE THAT I/WE HAVE READ THE RESOURCE ASSET
INVESTMENT TRUST DIVIDEND REINVESTMENT PLAN'S PROSPECTUS AND AGREE TO THE TERMS
OF THE PLAN AS DESCRIBED IN THE PROSPECTUS.
Signature of account owner(s) Date:
________________________________________________________________________________
________________________________________________________________________________
QUESTIONS? Call toll-free 1-800-278-4353
RETURN TO: American Stock Transfer & Trust Company
Attn: Dividend Reinvestment
40 Wall Street
New York, NY 10005
33
