Item 8.01. Other Events.
Monthly Operating Report
As previously disclosed, on August 30, 2019, RAIT Financial Trust ("RAIT") and
its affiliates RAIT Funding LLC, RAIT General, Inc., RAIT Limited, Inc., Taberna
Realty Finance Trust, RAIT JV TRS, LLC, and RAIT JV TRS Sub, LLC (together, the
"Debtors") filed voluntary bankruptcy cases (the "Chapter 11 Cases")
under chapter 11, Title 11 of the U.S. Bankruptcy Code (the "Bankruptcy Code")
in the United States Bankruptcy Court for the District of Delaware (the
"Bankruptcy Court"). The Chapter 11 Cases are jointly administered under the
caption In re: RAIT Funding, LLC, a Delaware limited liability company, et. al.
As previously disclosed in a Current Report on Form 8-K filed by RAIT on
November 19, 2019 (the "11/19/19 8K"), during the pendency of the Chapter 11
Cases, in lieu of filing Quarterly Reports on Form 10-Q and Annual Reports on
Form 10-K under Section 13(a) of the Securities Exchange Act of 1934, as amended
(the "Exchange Act"), RAIT intends to follow the modified reporting procedures
(the "Modified Reporting Procedures") outlined in Exchange Act Release No. 9660
(June 30, 1972), the Securities and Exchange Commission's (the "Commission")
Staff Legal Bulletin No. 2 (April 15, 1997) and the Commission's related
no-action correspondence, as described in the 11/19/19 8K.
On March 23, 2020, the Debtors jointly filed a monthly operating report for the
period from February 1, 2020 to February 29, 2020 (the "Monthly Operating
Report") with the Bankruptcy Court. In accordance with the Modified Reporting
Procedures, a copy of the Monthly Operating Report is attached as Exhibit 99.1
to this Current Report on Form 8-K and is incorporated herein by reference.
The Monthly Operating Report, court filings and other information related to the
Chapter 11 Cases are available at a website administered by the Debtors'
noticing and claims agent, Epiq Corporate Restructuring, LLC, at
https://dm.epiq11.com/rait, or www.deb.uscourts.gov, the official Bankruptcy
Court website. The information set forth in these websites is not incorporated
into this report.
Cautionary Statement Regarding Forward-Looking Statements
This Current Report on Form 8-K may contain certain forward-looking statements
within the meaning of Section 27A of the Securities Act of 1933, as amended, and
Section 21E of the Exchange Act. These statements are often, but not always,
made through the use of words or phrases such as "anticipates," "believes,"
"can," "could," "may," "potential," "should," "will," "plans," "continuing,"
"ongoing," "expects," "intends to," and similar words or phrases. Although RAIT
believes that the expectations reflected in these forward-looking statements are
reasonable, these statements are not guarantees of future performance and
involve risks and uncertainties that are subject to change based on various
important factors, some of which are beyond our control. Such forward-looking
statements include, but are not limited to, statements related to the
transactions contemplated by the Plan. These risks, uncertainties and
contingencies include, but are not limited to, (i) risks associated with
third-party motions in the Chapter 11 Cases; and (ii) increased legal, advisor
and other costs related to the Chapter 11 Cases and other litigation and the
inherent risks involved in a bankruptcy process. For additional discussion of
these risks, refer to the section entitled "Risk Factors" and elsewhere in the
RAIT's Annual Report on Form 10-K for the year ended December 31, 2018, filed
with the Commission on March 26, 2019, Amendment No. 1 to RAIT's Annual Report
on Form 10-K/A for the year ended December 31, 2018, filed with the Commission
on April 30, 2019, RAIT's Quarterly Report on Form 10-Q for the quarterly period
ended March 31, 2019, filed with the Commission on November 7, 2019 and RAIT's
Quarterly Report on Form 10-Q for the quarterly period ended June 30, 2019,
filed with the Commission on November 7, 2019. In light of the significant
uncertainties inherent in any forward-looking information included herein, the
inclusion of such information should not be regarded as a representation by RAIT
or any other person that RAIT's expectations, objectives or plans will be
achieved in the timeframe anticipated or at all. RAIT undertakes no obligation
to update these forward-looking statements to reflect events or circumstances
after the date hereof or to reflect the occurrence of unanticipated events,
except as may be required by law. All forward-looking statements attributable to
RAIT are expressly qualified by these cautionary statements.
Cautionary Statement Regarding Financial Operating Data
The Debtors caution investors and potential investors not to place undue
reliance upon the information contained in the Monthly Operating Report, which
was not prepared for the purpose of providing the basis for an investment
decision relating to any securities of the Debtors. The Debtors prepared the
Monthly Operating Report solely for purposes of complying with the monthly
operating reporting requirements applicable in the Chapter 11 Cases. The
financial information contained in the Monthly Operating Report is unaudited,
limited in scope, and as such, has not been subject to procedures that would
typically be applied to financial statements in accordance with accounting
principles generally accepted in the United States of America. These unaudited
financial statements were prepared using certain assumptions and estimates.
These assumptions and estimates are subject to revision. Further, the amounts
shown in this statement may differ materially due to adjustments in accruals,
changes in facts and circumstances, changes in estimates, further analysis, and
other factors. Accordingly, there can be no assurances that, from the
perspective of an investor or potential investor in RAIT's or its subsidiaries'
securities, the financial information contained in the Monthly Operating Report
is complete.
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Item 9.01 Financial Statements and Exhibits.
(d) Exhibits.
The following exhibits are included as part of this report:
Exhibit
No. Description
Debtors' Monthly Operating Report for the period February 1, 2020 to
99.1 February 29, 2020, filed with the United States Bankruptcy Court for the
District of Delaware.
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