RAIT Financial Trust (NYSE:RAS) Files An 8-K Entry into a Material Definitive Agreement
Item 1.01 Entry into a Material Definitive Agreement.

On April6, 2018, RAIT Financial Trust (“RAIT”), the Libby Frischer Family Partnership (the “Investor”) and CharlesF. Frischer (“Mr.Frischer”), the general partner of the Investor, entered in a Cooperation Agreement (the “Cooperation Agreement”).

The Cooperation Agreement sets forth defined restrictions for a restricted period lasting until the fourth day following RAIT’s 2019 Annual Meeting of Shareholders on the ability of the Investor, Mr.Frischer and their respective affiliates or associates (the “Investor Group”) to transfer RAIT’s common shares of beneficial interest (the “Common Shares”) and contains other restrictions.

The Cooperation Agreement also provides for certain standstill provisions restricting the activities of the Investor Group related to RAIT during any period (a “Standstill Period”) in which the Investor Group collectively owns any of RAIT’s equity securities (the “Additional Equity Securities”) of a class or series in excess of the ownership limit (the “Ownership Limit”) in RAIT’s Declaration of Trust (the “DOT”) applicable to such class or series (without giving effect to any exemption therefrom granted by RAIT).

to the Cooperation Agreement, during any Standstill Period, the Investor and Mr.Frischer will cause all Additional Equity Securities owned by the Investor Group to be present for quorum purposes and to be voted in accordance with the recommendation of a majority of the RAIT’s Board of Trustees (the “Board”) with respect to any matter at any meeting of RAIT’s shareholders for which proxies are solicited. With respect to any matter on which the consent of a member of the Investor Group is solicited by reason of such member’s holding of Additional Equity Securities during a Standstill Period, the Cooperation Agreement provides that the Investor and Mr.Frischer will cause such member of the Investor Group to provide its consent as a holder of such Additional Equity Securities to such matter as recommended by a majority of the Board.

to the Cooperation Agreement, in any calendar year, promptly following written notice from RAIT (provided that such notice is delivered on or prior to June 30th of such calendar year), Investor and/or Mr.Frischer may, subject to certain conditions, cause the Investor Group to, transfer any equity securities owned by the Investor Group as necessary in order for RAIT to continue to qualify as a real estate investment trust for federal income tax purposes (“REIT”).

to the Cooperation Agreement, at any time during 2018 or 2019, RAIT may, at its option, redeem, at $16.75 per share during 2018 and at $20.75 per share during 2019, any of RAIT’s 7.75% SeriesA Cumulative Redeemable Preferred Shares of Beneficial Interest (the “Series A Preferred Shares”), RAIT’s 8.375% SeriesB Cumulative Redeemable Preferred Shares of Beneficial Interest (the “Series B Preferred Shares”) and RAIT’s 8.875% SeriesC Cumulative Redeemable Preferred Shares of Beneficial Interest (the “Series C Preferred Shares,” and, together with the Series A Preferred Shares and the Series B Preferred Shares, the “Preferred Shares”) owned by the Investor Group (other than equity securities of RAIT owned by the Investor Group as of April5, 2018) by providing written notice to the Investor.

Subsequent to entering into the Cooperation Agreement, on April6, 2018, the Investor, and Mr.Frischer and RAIT signed a letter agreement (the “4/6/18 Letter”) which provided that RAIT would exempt the Investor from the Ownership Limit providing that no person may own more than 8.3% of RAIT’s outstanding Common Shares or more than 9.8% of any series of Preferred Shares. The 4/16/18 Letter exempts the Investor from this ownership limit for holding Common Shares and Preferred Shares that the Investor intends to purchase on or after April6, 2018 in amounts which, when added to the Common Shares and Preferred Shares owned by Mr.Frischer and certain affiliated entities of Mr.Frischer at the time of any such acquisition, does not exceed an amount (with respect to each class of shares to be acquired) equal to 15.0% of the outstanding number of Common Shares (with respect to Common Shares to be acquired) and an amount equal to up to 15.0% of the outstanding number of each series of Preferred Shares (with respect to each series of Preferred Shares to be acquired), respectively, at any time and from time to time.

Mr.Frischer has filed Statements of Beneficial Ownership on Schedule13D and amendments thereto on March2, 2018, March12, 2018 and April5, 2018 regarding his beneficial ownership of the Common Shares and Preferred Shares. The 4/6/18 Letter supersedes a previously disclosed letter agreement among these parties dated March30, 2018 which had granted a prior exemption to the Investor from the Ownership Limit for Common Shares.

The above summary of the Cooperation Agreement and the 4/6/18 Letter does not purport to be complete and is qualified in its entirety by the Cooperation Agreement and the 4/6/18 Letter attached to this Current Report on Form8-K as Exhibits10.1 and 10.2, respectively, and incorporated by reference herein.

(d) Exhibits.

RAIT Financial Trust Exhibit
EX-10.1 2 d559985dex101.htm EX-10.1 EX-10.1 Exhibit 10.1 COOPERATION AGREEMENT April 6,…
To view the full exhibit click here

About RAIT Financial Trust (NYSE:RAS)

RAIT Financial Trust (RAIT) is a self-managed and self-advised real estate investment trust (REIT). RAIT uses its vertically integrated platform and relationships to originate commercial real estate loans, acquire commercial real estate properties and invest in, manage and service commercial real estate assets. The Company’s segments are real estate lending, owning and managing segment, Independence Realty Trust, Inc. (IRT) segment and Taberna Securitization segment. The Company’s real estate lending, owning and managing segment concentrates on lending, owning and managing commercial real estate assets throughout the United States. The Company’s IRT segment concentrates on the ownership of apartment properties in opportunistic markets throughout the United States. The Company’s Taberna Securitization segment includes the ownership and management of approximately three real estate trust preferred securitizations.