RAIT FINANCIAL TRUST : Completion of Acquisition or Disposition of Assets (form 8-K)

Item 2.01 Completion of Acquisition or Disposition of Assets.

As previously disclosed by RAIT Financial Trust ("RAIT"):

    •     On August 30, 2019, RAIT and its affiliates RAIT Funding LLC, RAIT
          General, Inc. ("RAIT General"), RAIT Limited, Inc. ("RAIT Limited"),
          Taberna Realty Finance Trust ("TRFT"), RAIT JV TRS, LLC, and RAIT JV TRS
          Sub, LLC (each, a "Debtor", and together, the "Debtors") filed voluntary
          bankruptcy cases (the "Chapter 11 Cases") under chapter 11, Title 11 of
          the U.S. 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.;




    •     On the same date, RAIT, RAIT General, RAIT Limited and TRFT (together,
          the "Sellers"), entered into an Equity and Asset Purchase Agreement (the
          "Original Purchase Agreement"), as amended by Amendment No. 1 to the
          Equity and Asset Purchase Agreement, dated October 4, 2019 (the
          "Amendment", and the Original Purchase Agreement, as so amended, the
          "Purchase Agreement"), with CF RFP Holdings LLC, a Delaware limited
          liability company and an entity owned by funds managed by affiliates of
          Fortress Investment Group LLC ("Buyer"), pursuant to which, among other
          things, Buyer agreed to purchase certain subsidiaries and assets of the
          Sellers (together, the "Purchased Assets"); and




    •     On August 29, 2019, RAIT entered into a Restructuring and Plan Support
          Agreement (the "RSA") with TRFT, and TP Management LLC, an affiliate of
          Buyer, in its capacity as delegate collateral manager ("TPM"). TPM is the
          collateral manager of a securitization collateralized in part by a Junior
          Subordinated Note due 2035 (the "2035 Note") issued under a Junior
          Subordinated Indenture, dated October 25, 2010, by and between TRFT and
          Wells Fargo Bank, National Association, as Trustee. Pursuant to the RSA,
          TPM agreed, among other things, to support, and take reasonable necessary
          actions in furtherance of, the transactions contemplated by the Purchase
          Agreement.

On December 23, 2019, the Sellers completed the sale (the "Closing") of the Purchased Assets to Buyer pursuant to the terms of the Purchase Agreement in consideration for $172.8 million (including $40.2 million of cash and cash equivalents that are being retained by RAIT), of which $4.0 million will be held in escrow for up to twenty-four (24) months following the Closing for the purpose of satisfying certain contingent indemnification obligations related to certain tax representations, to the extent such obligations become non-contingent. The Purchased Assets comprised of (i) equity interests in certain RAIT subsidiaries holding substantially all of RAIT's operating assets, (ii) cash and cash equivalents, (iii) Class F, G and H notes issued by RAIT CRE CDO I, Ltd. and RAIT CRE CDO I, LLC, (iv) a participation interest in a commercial real estate mortgage loan, and (v) the assignment and assumption of certain guaranties made by RAIT related to loans secured by real estate owned by certain subsidiaries of RAIT. The Purchase Price was determined as a result of bidding processes conducted by RAIT (i) in the period prior to filing the Chapter 11 Cases and (ii) post-filing, pursuant to Bankruptcy Court-approved bidding procedures, and no higher or otherwise better bid was received as a result of the bidding procedures.

These descriptions are qualified in their entity by reference to the full text of the Original Purchase Agreement, the Amendment and the RSA, which are filed as Exhibits 10.1.1, 10.1.2, and 10.2.1, respectively, to RAIT's Quarterly Report on Form 10-Q for the quarterly period ended March 31, 2019.

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