Exhibit 5
[LETTERHEAD OF BALLARD SPAHR ANDREWS & INGERSOLL, LLP]
October 27, 2003
Friedman, Billings, Ramsey & Co., Inc.
as Representative of the several Underwriters
listed in Schedule I of the Underwriting Agreement
1001 19th Street North
Arlington, Virginia 22209
Re: RAIT Investment Trust, a Maryland real estate investment
trust (the "Company") - issuance and sale of up to Two
Million Three Hundred Thousand (2,300,000) common shares
of beneficial interest of the Company, par value one
cent ($.01) per share (the "Shares"), pursuant to a
Registration Statement on Form S-3 (Registration No.
333-103618), as supplemented (the "Registration
Statement")
Ladies and Gentlemen:
You have requested our opinion as Maryland counsel to
the Company as to certain aspects of Maryland law pursuant to Section 6(c) of
the Agreement, dated as of October 22, 2003 (the "Underwriting Agreement"), by
and among the Company, RAIT Partnership, L.P., a Delaware limited partnership of
which a wholly-owned subsidiary of the Company acts as the general partner (the
"Operating Partnership"), and Friedman, Billings, Ramsey & Co., Inc., as
Representative of the several Underwriters listed in Schedule I of the
Underwriting Agreement. Unless otherwise defined herein, all capitalized terms
shall have the meanings ascribed to them in the Underwriting Agreement.
In our capacity as Maryland counsel to the Company and
for purposes of this opinion, we have examined the following documents:
(a) the declaration of trust of the Company (the
"Declaration of Trust") represented by Articles of
Amendment and Restatement filed with the State
Department of Assessments and Taxation of Maryland (the
"Department") on November 19, 1997, Articles of
Amendment filed with the Department on January 7, 1998
and September 29, 2000 and a Certificate of Correction
filed with the Department on May 10, 2002;
BALLARD SPAHR ANDREWS & INGERSOLL, LLP
Friedman, Billings, Ramsey & Co., Inc.
as Representative of the several Underwriters
listed in Schedule I of the Underwriting Agreement
October 27, 2003
Page 2
(b) the Bylaws of the Company, adopted as of August 14, 1997
(the "Bylaws");
(c) the Organizational Action by Consent in Writing of the
Sole Trustee of the Company, dated as of August 14, 1997
(the "Organizational Minutes");
(d) resolutions adopted by the Board of Trustees of the
Company, or committees thereof, as of October 1, 1997,
December 5, 1997, December 10, 1997, January 5, 1998,
January 8, 1998, January 9, 1998, June 4, 1998, June 30,
1998, December 10, 1998, March 17, 1999, November 1,
2000, January 24, 2001, February 12, 2001, April 25,
2001, June 8, 2001, July 12, 2001, July 25, 2001,
September 5, 2001, October 5, 2001, November 14, 2001,
December 17, 2001, December 20, 2001, January 11, 2002,
January 23, 2002, March 6, 2002, April 3, 2002, April
22, 2002, August 27, 2002, January 30, 2003, February 5,
2003, March 4, 2003, July 29, 2003 and October 8, 2003
(together with the Organizational Minutes, the
"Trustees' Resolutions");
(e) the Base Prospectus, dated July 10, 2003 (the "Base
Prospectus"), and the Prospectus Supplement, dated
October 22, 2003, filed by the Company with the
Securities and Exchange Commission for the offering by
the Company of the Shares (the "Prospectus Supplement")
(the Base Prospectus and the Prospectus Supplement,
including all documents incorporated or deemed
incorporated by reference therein as of October 22,
2003, are hereinafter referred to as, collectively, the
"Prospectus");
(f) a specimen share certificate (the "Specimen Share
Certificate") representing common shares of beneficial
interest of the Company;
(g) a status certificate of the Department, dated October
23, 2003, to the effect that the Company is duly formed
and existing under the laws of the State of Maryland and
is duly authorized to transact business in the State of
Maryland;
(h) a fully executed counterpart of the Underwriting
Agreement;
(i) a certificate of Betsy Z. Cohen, the Chairman of the
Board and Chief Executive Officer of the Company, and
Ellen J. DiStefano, the Chief Financial Officer and
Executive Vice President of the Company, dated October
27, 2003 (the "Officers' Certificate"), to the effect
that, among other things, the Declaration of Trust, the
Bylaws, and the Trustees' Resolutions are true, correct
and complete, and that the Declaration of Trust, the
Bylaws and the Trustees' Resolutions have not been
rescinded or modified and are in full force and effect
as of the date of the Officers' Certificate, and
certifying as to the manner of adoption of the Trustees'
Resolutions, the authorization for issuance of the
Shares, the due authorization
BALLARD SPAHR ANDREWS & INGERSOLL, LLP
Friedman, Billings, Ramsey & Co., Inc.
as Representative of the several Underwriters
listed in Schedule I of the Underwriting Agreement
October 27, 2003
Page 3
and issuance of the shares of beneficial interest of the
Company issued and outstanding as of the date of the
Officers' Certificate and the receipt of consideration
therefor, the form of the Specimen Share Certificate,
and the form, approval, execution and delivery of the
Underwriting Agreement;
(j) the corporate charter of RAIT General, Inc., a Maryland
corporation ("RAIT GP"), represented by Articles of
Incorporation filed with the Department on August 14,
1997 (the "RAIT GP Charter");
(k) the Bylaws of RAIT GP, as adopted on August 14, 1997
(the "RAIT GP Bylaws");
(l) the Organizational Action by Consent in Writing of the
Sole Director of RAIT GP, dated as of August 14, 1997
(the "RAIT GP Organizational Minutes");
(m) resolutions adopted by the sole Director of RAIT GP on
December 19, 1997 and by the Board of Directors of RAIT
GP on October 22, 2003 (together with the RAIT GP
Organizational Minutes, the "RAIT GP Directors'
Resolutions");
(n) a status certificate of the Department, dated October
23, 2003, to the effect that RAIT GP is duly
incorporated and existing under the laws of the State of
Maryland and duly authorized to transact business in the
State of Maryland;
(o) a certificate of Betsy Z. Cohen, the Chairman of the
Board and Chief Executive Officer of RAIT GP, and Ellen
J. DiStefano, the Chief Financial Officer, Secretary and
Vice President of RAIT GP, dated October 27, 2003 (the
"RAIT GP Officers' Certificate"), to the effect that,
among other things, the RAIT GP Charter, the RAIT GP
Bylaws and the RAIT GP Directors' Resolutions are true,
correct and complete and that the RAIT GP Charter as
filed with the Department on August 14, 1997, the RAIT
GP Bylaws as adopted on August 14, 1997 and the RAIT GP
Directors' Resolutions have not been rescinded or
modified and are in full force and effect as of the date
of the RAIT GP Officers' Certificate and certifying as
to the manner of adoption of the RAIT GP Directors'
Resolutions, and the due authorization and issuance of
the shares of stock of RAIT GP issued and outstanding as
of the date of the RAIT GP Officers' Certificate, the
record owner thereof and the receipt of the
consideration therefor;
(p) the corporate charter of RAIT Limited, Inc., a Maryland
corporation ("RAIT LP"), represented by Articles of
Incorporation filed with the Department on August 14,
1997 (the "RAIT LP Charter");
(q) the Bylaws of RAIT LP, as adopted on August 14, 1997
(the "RAIT LP Bylaws");
BALLARD SPAHR ANDREWS & INGERSOLL, LLP
Friedman, Billings, Ramsey & Co., Inc.
as Representative of the several Underwriters
listed in Schedule I of the Underwriting Agreement
October 27, 2003
Page 4
(r) the Organizational Action by Consent in Writing of the
Sole Director of RAIT LP, dated as of August 14, 1997
(the "RAIT LP Organizational Minutes");
(s) resolutions adopted by the sole Director of RAIT LP on
December 19, 1997 (together with the RAIT LP
Organizational Minutes, the "RAIT LP Director's
Resolutions");
(t) a status certificate of the Department, dated October
23, 2003, to the effect that RAIT LP is duly
incorporated and existing under the laws of the State of
Maryland and duly authorized to transact business in the
State of Maryland;
(u) a certificate of Betsy Z. Cohen, the Chairman of the
Board and Chief Executive Officer of RAIT LP, and Ellen
J. DiStefano, the Chief Financial Officer, Secretary and
Vice President of the RAIT LP, dated October 27, 2003
(the "RAIT LP Officers' Certificate") to the effect
that, among other things, the RAIT LP Charter, the RAIT
LP Bylaws and the RAIT LP Director's Resolutions are
true, correct and complete and that the RAIT LP Charter
as filed with the Department on August 14, 1997, the
RAIT LP Bylaws as adopted on August 14, 1997 and the
RAIT LP Director's Resolutions have not been rescinded
or modified and are in full force and effect as of the
date of the RAIT LP Officers' Certificate and certifying
as to the manner of adoption of the RAIT LP Directors'
Resolutions, and the due authorization and issuance of
the shares of stock of RAIT LP issued and outstanding as
of the date of the RAIT LP Officers' Certificate, the
record owner thereof and the receipt of the
consideration therefor; and
(v) such other documents and matters as we have deemed
necessary and appropriate to render the opinions set
forth in this letter, subject to the limitations,
assumptions, and qualifications noted below.
Insofar as the opinions and other matters set forth
herein constitute, or are based upon, factual matters, we have relied solely
upon the Officers' Certificate, the RAIT GP Officers' Certificate, the RAIT LP
Officers' Certificate and our knowledge. The words "our knowledge" signify that,
in the course of our representation of the Company in matters with respect to
which we have been engaged by the Company as Maryland counsel, no information
has come to our attention that would give us actual knowledge or actual notice
that any of the foregoing certificates on which we have relied are not accurate
and complete. We have undertaken no independent investigation or verification of
any such factual matters. The words "our knowledge" and similar language used
herein are intended to be limited to the knowledge of the attorneys within our
firm who have represented the Company as Maryland counsel in connection with the
sale of the Shares.
BALLARD SPAHR ANDREWS & INGERSOLL, LLP
Friedman, Billings, Ramsey & Co., Inc.
as Representative of the several Underwriters
listed in Schedule I of the Underwriting Agreement
October 27, 2003
Page 5
In reaching the opinions set forth below, we have
assumed the following:
(i) each person executing any instrument, document or
agreement on behalf of any party (other than the
Company, RAIT GP or RAIT LP) is duly authorized to do
so;
(ii) each natural person executing any instrument, document
or agreement is legally competent to do so;
(iii) there are no material modifications of, or amendments
to, the pertinent sections of the Prospectus or to the
Underwriting Agreement;
(iv) all documents submitted to us as originals are
authentic; all documents submitted to us as certified,
facsimile or photostatic copies conform to the original
document; all signatures on all documents submitted to
us for examination are genuine; and all public records
reviewed are accurate and complete;
(v) the actions documented by the Trustees' Resolutions were
taken at duly called meetings at which a quorum of the
incumbent trustees, or in the case of a committee of the
board of trustees, a quorum of the incumbent members of
the committee, was present and acting throughout, or by
unanimous written consent of all incumbent trustees, or
in the case of a committee of the board of trustees, all
incumbent members of the committee, all in accordance
with the Declaration of Trust and the Bylaws of the
Company and applicable law;
(vi) the Officers' Certificate, the RAIT GP Officers'
Certificate, the RAIT LP Officers' Certificate and all
other certificates submitted to us are true and correct
both when made and as of the date hereof;
(vii) the Company has not, and is not required to be,
registered under the Investment Company Act of 1940;
(viii) the issuance and sale, or any subsequent transfer, of
the shares of beneficial interest certified as issued
and outstanding in the Officers' Certificate (excluding
the Shares) did not violate any restriction or
limitation contained in Article VII of the Declaration
of Trust;
(ix) the issuance and sale of the Shares to the Underwriters
pursuant to the Underwriting Agreement will not violate
any restriction or limitation contained in Article VII
of the Declaration of Trust;
BALLARD SPAHR ANDREWS & INGERSOLL, LLP
Friedman, Billings, Ramsey & Co., Inc.
as Representative of the several Underwriters
listed in Schedule I of the Underwriting Agreement
October 27, 2003
Page 6
(x) each of the parties thereto (other than the Company,
RAIT GP and RAIT LP) have duly and validly authorized,
executed and delivered each instrument, document and
agreement, including, but not limited to, the
Underwriting Agreement, executed in connection with the
transactions contemplated by the Underwriting Agreement
to which such party is a signatory and such party's
obligations set forth therein are its legal, valid and
binding obligations, enforceable in accordance with
their respective terms;
(xi) none of the shares of beneficial interest of the Company
certified as issued and outstanding in the Officers'
Certificate were issued to an Interested Stockholder of
the Company or an Affiliate thereof, all as defined in
Subtitle 6 of Title 3 of the Maryland General
Corporation Law (the "MGCL"), in violation of Section
3-602 of the MGCL;
(xii) the Shares will not be issued to an Interested
Stockholder of the Company or an Affiliate thereof in
violation of Section 3-602 of the MGCL;
(xiii) at all times from and after their date of issuance
through the date of issuance of the Shares, all shares
of beneficial interest of the Company (including the
Shares) constitute, and will constitute, "transferable
shares" under Section 856(a)(2) of the Internal Revenue
Code of 1986, as amended; and
(xiv) the issued and outstanding common shares of beneficial
interest of the Company as of October 8, 2003,
consisting of 20,855,597 common shares of beneficial
interest of the Company, par value one cent ($.01) per
share, are as certified in the Officers' Certificate.
Based on our review of the foregoing and subject to the
assumptions and qualifications set forth herein, it is our opinion that, as of
the date of this letter:
1) The Company has been duly formed and is validly existing
as a real estate investment trust in good standing under
the laws of the State of Maryland.
2) The Company has the requisite power and authority to
own, lease and operate its properties and to conduct its
business as described in the Registration Statement and
the Prospectus, and to enter into the Underwriting
Agreement and to issue, sell and deliver the Shares to
the Underwriters pursuant to the Underwriting Agreement
and to consummate the transactions contemplated by the
Underwriting Agreement.
3) RAIT GP has been duly incorporated and is validly
existing as a corporation in good standing under the
laws of the State of Maryland.
BALLARD SPAHR ANDREWS & INGERSOLL, LLP
Friedman, Billings, Ramsey & Co., Inc.
as Representative of the several Underwriters
listed in Schedule I of the Underwriting Agreement
October 27, 2003
Page 7
4) RAIT GP has the requisite corporate power and corporate
authority to own, lease and operate its properties and
conduct its business as described in the Registration
Statement and the Prospectus.
5) RAIT LP has been duly incorporated and is validly
existing as a corporation in good standing under the
laws of the State of Maryland.
6) RAIT LP has the requisite corporate power and corporate
authority to own, lease and operate its properties and
conduct its business as described in the Registration
Statement and the Prospectus.
7) The issued and outstanding shares of beneficial interest
of the Company as of October 8, 2003, consisting of
20,855,597 common shares of beneficial interest, have
been duly authorized and validly issued and are fully
paid and non-assessable.
8) The Shares have been duly authorized for issuance by the
Company, and the Shares, when issued and delivered in
exchange for payment of the consideration therefor as
contemplated by the Underwriting Agreement, will be
validly issued, fully paid and non-assessable.
9) RAIT GP has a total of 99 shares of stock ("the RAIT GP
Shares") issued and outstanding, all of which is common
stock, par value one cent ($.01) per share; all
necessary corporate action required under the RAIT GP
Charter, the RAIT GP Bylaws and the MGCL was taken in
order to duly authorize the issuance of such shares, and
such shares are validly issued and fully paid and
nonassessable. The RAIT GP Shares are directly owned of
record by the Company.
10) RAIT LP has a total of 99 shares of stock (the "RAIT LP
Shares") issued and outstanding, all of which is common
stock, par value one cent ($.01) per share; all
necessary corporate action required under the RAIT LP
Charter, the RAIT LP Bylaws and the MGCL was taken in
order to duly authorize the issuance of such shares, and
such shares are validly issued and fully paid and
nonassessable. The RAIT LP Shares are directly owned of
record by the Company.
11) The execution and delivery by the Company of the
Underwriting Agreement have been duly authorized by all
necessary real estate investment trust action required
under the Declaration of Trust, the Bylaws, and other
applicable Maryland law. The Underwriting Agreement has
been duly executed and delivered by the Company.
BALLARD SPAHR ANDREWS & INGERSOLL, LLP
Friedman, Billings, Ramsey & Co., Inc.
as Representative of the several Underwriters
listed in Schedule I of the Underwriting Agreement
October 27, 2003
Page 8
12) The statements under the captions "Certain Provisions of
Maryland Law and of our Declaration of Trust and Bylaws"
and "Description of Shares of Beneficial Interest" in
the Registration Statement and the Prospectus, insofar
as such statements constitute matters of Maryland
corporate law or Maryland real estate investment trust
law, have been reviewed by us and are a fair summary of
such matters.
13) Except as disclosed in the Prospectus, and assuming
compliance with Sections 2-311 and 2-419 of the MGCL and
approval by the directors and the stockholder of RAIT GP
as required by the RAIT GP Charter, the RAIT GP Bylaws
or the MGCL, RAIT GP is not prohibited or restricted by
the MGCL, the RAIT GP Charter or the RAIT GP Bylaws from
paying dividends to the Company or from making any other
distribution with respect to its capital stock or from
repaying the Company, or any other Subsidiary, for any
loans or advances to RAIT GP, or from transferring RAIT
GP's property or assets to the Company or to any other
Subsidiary in exchange for fair consideration.
14) Except as disclosed in the Prospectus, and assuming
compliance with Sections 2-311 and 2-419 of the MGCL and
approval by the directors and the stockholder of RAIT LP
as required by the RAIT LP Charter, the RAIT LP Bylaws
or the MGCL, RAIT LP is not prohibited or restricted by
the MGCL, the RAIT LP Charter or the RAIT LP Bylaws from
paying dividends to the Company or from making any other
distribution with respect to its capital stock or from
repaying the Company, or any other Subsidiary, for any
loans or advances to RAIT LP, or from transferring RAIT
LP's property or assets to the Company or to any other
Subsidiary in exchange for fair consideration.
The opinions presented in this letter are limited to the
law of the State of Maryland, and we do not express any opinions herein
concerning any law other than the law of the State of Maryland. Furthermore, the
opinions presented in this letter are limited to the matters specifically set
forth herein and no other opinion shall be inferred beyond the matters expressly
stated. Without limiting the generality of the foregoing sentence, we express no
opinion with respect to the applicability or effect of any state or federal
securities laws or federal or state laws regarding fraudulent transfers.
This letter is issued as of the date hereof and the
opinions presented herein are necessarily limited to laws now in effect and
facts and circumstances presently existing and brought to our attention. We
assume no obligation to supplement the opinions presented herein if any
applicable laws change after the date hereof or if we become aware of any facts
or circumstances which now exist or which occur or arise in the future that may
change the opinions presented herein after the date hereof.
BALLARD SPAHR ANDREWS & INGERSOLL, LLP
Friedman, Billings, Ramsey & Co., Inc.
as Representative of the several Underwriters
listed in Schedule I of the Underwriting Agreement
October 27, 2003
Page 9
The opinions presented in this letter are solely for the
use of: (i) the Underwriters in connection with the transactions contemplated by
the Underwriting Agreement; (ii) Ledgewood Law Firm, P.C., as securities counsel
for the Company in rendering its opinion under Section 6(b) of the Underwriting
Agreement; and (iii) Hunton & Williams LLP as counsel to the Underwriters in
rendering its opinion under Section 6(e) of the Underwriting Agreement. The
opinions presented herein may not be relied upon by any other person or by you,
Ledgewood Law Firm, P.C. or Hunton & Williams LLP for any other purpose, without
our prior written consent.
Very truly yours,
/s/ Ballard Spahr Andrews & Ingersoll, LLP