Document:

ras-ex103_8.htm

 

Exhibit 10.3

RAIT FINANCIAL TRUST

2012 INCENTIVE AWARD PLAN

SHARE APPRECIATION RIGHTS AWARD AGREEMENT

 

This SHARE APPRECIATION RIGHTS AWARD AGREEMENT, dated as of                      February 14, 2017 (the “Date of Grant”), is delivered by RAIT Financial Trust (“RAIT”), to [Name of Participant] (the “Participant”).   

RECITALS

A.The RAIT Financial Trust 2012 Incentive Award Plan (the “Plan”) provides for the grant of share appreciation rights (“SARs”), which represent the right to receive the appreciation of an equal number common shares of beneficial interest, par value $0.03, of RAIT (“Common Shares”), in cash or Common Shares on a future settlement date.

B.The Compensation Committee of the Board of Trustees of RAIT (the “Committee”) has decided to make a restricted SAR grant, subject to the terms and conditions set forth in this Share Appreciation Rights Award Agreement (the “Agreement”) and the Plan, as an inducement for Participant to promote the best interests of RAIT and its shareholders.  Participant may receive a copy of the Plan by contacting the Chief Financial Officer of RAIT.

NOW, THEREFORE, the parties to this Agreement, intending to be legally bound hereby, agree as follows: 

1.Grant of SARs.  Subject to the terms and conditions set forth in this Agreement and the Plan, RAIT hereby grants to Participant [Number of SARs Awarded] SARs (the “SARs”).  The SARs will become vested in accordance with Paragraph 3 below and may be exercised in accordance with Paragraph 4 below.  Each SAR shall represent the right to receive the excess of the Fair Market Value (as determined under the Plan) of a Common Share on the date of exercise (“Exercise Date”) over the Fair Market Value of a Common Share on the Date of Grant: $3.78.  Such increase in Fair Market Value is hereafter referred to as the “Value” of the SAR.  

2.Accounts.  RAIT shall establish and maintain a SAR account (the “SAR Account”) as a bookkeeping account on its records and shall record in such SAR Account the number of SARs granted to Participant.  Participant shall not have any interest in any fund or specific assets of RAIT by reason of the SAR grant or the SAR Account established for Participant.

3.Vesting.

(a)Participant will become vested in the SARs awarded pursuant to this grant according to the following vesting schedule, provided Participant does not incur a termination of employment or service with the Company (as defined in the Plan) prior to the applicable vesting date (the “Vesting Date”):

 

 

 

		
		
	
Vesting Date
	
Portion of
SARs Vesting

	
First anniversary of Date of Grant
	
1/3

	
Second anniversary of Date of Grant
	
1/3

	
Third anniversary of Date of Grant
	
1/3

 

The vesting of the SARs is cumulative, but shall not exceed 100% of the SARs subject to this Agreement.  Participant’s SARs shall become fully vested if Participant is employed by, or providing service to, the Company on the third anniversary of the Date of Grant.  In the event that: (1) the Participant dies or becomes disabled (as defined under section 409A(a)(2)(C) of the Internal Revenue Code (the “Code”)) while employed by, or providing services to, the Company; (2) the Participant’s employment with the Company is terminated involuntarily for any reason other than a termination for cause (as defined under the terms of the Participant’s employment or services agreement or, if no such agreement is in force, as determined by the Company in its reasonable discretion) or (3) the Participant Retires (as defined below), Participant shall be deemed fully vested in all shares awarded under this Agreement.  

(b)If Participant’s employment or service with the Company terminates for any reason other than death, disability, Retirement or an involuntary termination, other than a termination for cause, prior to Participant vesting in any of the SARs as provided in subparagraph (a), the SARs that are not vested as of Participant’s termination of employment or service shall terminate and Participant shall not have any exercise rights with respect to such unvested SARs. 

 

(c)The above notwithstanding, in the event that Participant’s employment or service with the Company is terminated for “cause” or “willful misconduct,” as defined under the terms of the Participant’s employment or services agreement (if applicable); or as determined in the sole and absolute discretion of the Company, the Participant shall forfeit the right to exercise any vested SARs and the right to settlement of exercised SARs.  Additionally, in the event that Participant engages in any conduct in violation or post-employment or post-services covenants or obligations to the Company, the Participant shall forfeit the right to exercise any vested SARs and the right to settlement of exercised SARs.

 

(d)For purposes of this agreement, “Retirement” shall mean the Participant’s voluntary separation of employment following satisfaction of the Rule of 70. The Rule of 70 is satisfied upon (1) completion of at least fifteen (15) years of service with the Company or its related entities; (2) attainment of the age of fifty-five (55) and (3) such Participant’s combined age and service equals at least seventy (70). A Participant may separate upon Retirement subject to providing at least six (6) months’ advance notice to the Company and entering into a separate three-year non-competition and non-solicitation agreement, if requested by the Company. 

 

4.Exercise and Settlement of SAR   Each SAR shall be exercisable on or after its applicable Vesting Date in accordance with the terms of Exhibit A of this Agreement and the Plan.

5.Change of Control.  If a Change of Control (as defined in the Plan) occurs, unless the Committee determines otherwise as provided under the terms of the Plan and in accordance with the requirements of section 409A of the Code, (i) all of Participant’s unvested SARs as of such date shall continue to vest in accordance with their terms and (ii) all of Participant’s vested SARs as of such date shall be deemed exercised by Participant and shall be settled in accordance with the terms of Paragraph 4.   

 

6.Acknowledgment by Participant.  By executing this Agreement, Participant hereby acknowledges that with respect to any right of settlement or payment pursuant to this Agreement, Participant is and shall be an unsecured general creditor of RAIT without any preference as against other unsecured general creditors of RAIT, and Participant hereby covenants for himself or herself, and anyone at any time claiming through or under Participant not to claim any such preference, and hereby disclaims and waives any such preference which may at any time be at issue, to the fullest extent permitted by applicable law.  

 

 

 

Participant also hereby agrees to be bound by the terms and conditions of the Plan and this Agreement.  Participant further agrees to be bound by the determinations and decisions of the Committee with respect to this Agreement and the Plan and Participant’s rights to benefits under this Agreement and the Plan, and agrees that all such determinations and decisions of the Committee shall be binding on Participant, his or her beneficiaries and any other person having or claiming an interest under this Agreement and the Plan on behalf of Participant. 

7.Restrictions on Exercise and Settlement of SARs.

(a) Participant agrees to be bound by RAIT’s policy regarding the transfer of interests in the Company and acknowledges that such policy may limit timing and manner in which Participant may exercise the SARs granted pursuant to this Agreement and/or sell any Common Shares issued by the Company in settlement of the SARs granted pursuant to this Agreement. The RAIT Insider Trading Policy is attached to this Agreement.

(b)The decision of RAIT to deliver Common Shares in settlement of the SARs shall be subject to the condition that if at any time the Committee shall determine in its discretion that the listing, registration or qualification of the Common Shares upon any securities exchange or under any state or federal law, or the consent or approval of any governmental regulatory body is necessary or desirable as a condition of, or in connection with, the issuance of Common Shares, the Common Shares may not be issued in whole or in part unless such listing, registration, qualification, consent or approval shall have been effected or obtained free of any conditions not acceptable to the Committee.  The issuance of Common Shares and/or the payment of cash to Participant pursuant to this Agreement are subject to any applicable taxes and other laws or regulations of the United States or of any state having jurisdiction thereof.

8.Grant Subject to Plan Provisions.  This grant is made pursuant to the Plan, the terms of which are incorporated herein by reference, and in all respects shall be interpreted in accordance with the Plan.  In the event of any contradiction, distinction or difference between this Agreement and the terms of the Plan, the terms of the Plan will control.  Except as otherwise defined in this Agreement, capitalized terms used in this Agreement shall have the meanings set forth in the Plan.  This grant is subject to the interpretations, regulations and determinations concerning the Plan established from time to time by the Committee in accordance with the provisions of the Plan, including, but not limited to, provisions pertaining to (i) rights and obligations with respect to withholding taxes, (ii) the registration, qualification or listing of the Common Shares, (iii) changes in capitalization of RAIT, and (iv) other requirements of applicable law. The Committee shall have the authority to interpret and construe this grant pursuant to the terms of the Plan, its decisions shall be conclusive as to any questions arising hereunder and Participant’s acceptance of this grant is Participant’s agreement to be bound by the interpretations and decisions of the Committee with respect to this grant and the Plan. 

9.No Rights as Shareholder.  Participant shall not have any rights as a shareholder of RAIT, including the right to any cash dividends, or the right to vote, with respect to any SARs. 

10.No Rights to Continued Employment or Service. This grant shall not confer upon Participant any right to be retained in the employment or service of the Company and shall not interfere in any way with the right of the Company to terminate Participant’s employment or service at any time.  The right of the Company to terminate at will Participant’s employment or service at any time for any reason is specifically reserved. 

11.Assignment and Transfers.  No SARs awarded to Participant under this Agreement may be transferred, assigned, pledged, or encumbered by Participant. All SARs shall be settled during the lifetime of Participant only for the benefit of Participant.  Any attempt to transfer, assign, pledge, or encumber the SAR by Participant shall be null, void and without effect.  The rights and protections of RAIT hereunder 

 

 

 

shall extend to any successors or assigns of RAIT.  This Agreement may be assigned by RAIT without Participant’s consent. 

12.Withholding.  Participant shall be required to pay to the Company, or make other arrangements satisfactory to the Company to provide for the payment of, any federal, state, local or other taxes that the Company is required to withhold with respect to the exercise and settlement of the SARs.  Participant may elect to satisfy any tax withholding obligation of the Company with respect to the SARs by having cash or Common Shares withheld from the proceeds of such settlement up to an amount that does not exceed the minimum applicable withholding tax rate for federal (including FICA), state, local and other tax liabilities. 

13.Effect on Other Benefits.  The value of cash and/or Common Shares paid with respect to the SARs shall not be considered eligible earnings for purposes of any other plans maintained by the Company.  Neither shall such value be considered part of Participant’s compensation for purposes of determining or calculating other benefits that are based on compensation, such as life insurance. 

14.Termination of SAR. Participant’s right to exercise vested SARs shall terminate upon the earlier of (i) 30 days following termination of employment or service; or (ii) the 5th anniversary of the Date of Grant.

15.Applicable Law.  The validity, construction, interpretation and effect of this Agreement shall be governed by and construed in accordance with the laws of the State of Maryland without giving effect to the conflicts of laws provisions thereof. 

16.Notice.  Any notice to RAIT provided for in this instrument shall be addressed to RAIT in care of the Board of Trustees at the principal office of RAIT, and any notice to Participant shall be addressed to such Participant at the current address shown on the payroll records of the Company, or to such other address as Participant may designate to RAIT in writing.  Any notice shall be delivered by hand, sent by telecopy or enclosed in a properly sealed envelope addressed as stated above, registered and deposited, postage prepaid, in a post office regularly maintained by the United States Postal Service. 

17.Section 409A of the Code.  This Agreement is intended to comply with the requirements of section 409A of the Code and shall in all respects be administered in accordance with such requirements.  Notwithstanding any provision in this Agreement to the contrary, redemption and payment may only be made under this Agreement upon an event or in a manner permitted by section 409A of the Code or an applicable exemption.  Each payment under this Agreement shall be treated as a separate payment for purposes of section 409A of the Code.  In no event may Participant designate the calendar year of a payment. 

 

 

[Signatures Follow]

 

 

 

IN WITNESS WHEREOF, RAIT has caused its duly authorized officer to execute this Share Appreciation Rights Award Agreement, and Participant has placed his or her signature hereon, effective as of the Date of Grant. 

RAIT FINANCIAL TRUST

 

By:

      Name: 

      Title: 

 

 

I hereby accept the award of SARs described in this Agreement, and I agree to be bound by the terms of this Agreement and the Plan.  I hereby acknowledge and agree that all of the decisions, interpretations and determinations of the Committee with respect to the SARs shall be final, binding and conclusive on me, my beneficiaries and any other persons having or claiming an interest under this Agreement. 

Date:
Signature of Participant

Name of Participant

 

 

 

 

EXHIBIT A

 

RAIT FINANCIAL TRUST

2012 INCENTIVE AWARD PLAN 

Exercise AND SETTLEMENT OF Vested SARS

 

Capitalized terms used herein are defined as defined in the Share Appreciation Rights Award Agreement (the “Agreement”) to which this Exhibit is attached unless otherwise defined herein. This Exhibit sets forth the procedures the Participant must follow to exercise the SARs granted to the Participant pursuant to the Agreement.  

 

Each SAR shall be exercisable on or after its applicable Vesting Date in accordance with the terms of the Agreement and the Plan.  Any such vesting is subject to the terms and conditions of the Plan and your SARs Award. A SAR shall be exercised upon delivery by the Participant to RAIT’s Human Resources department of a completed exercise election form (“Election Form”) substantially in the form attached as Appendix A to this Exhibit specifying the number of SARs to be exercised and the date of exercise (which shall be prospective).  The number of SARs to be exercised may not exceed the number of vested SARs as of the date of exercise.  Upon approval by the Committee, the aggregate Value of exercised SARs shall be settled and paid to Participant in cash, an equivalent value of Common Shares or any combination thereof as determined in the sole and exclusive discretion of the Committee. 

 

In the Election Form, the Participant must designate a specific Exercise Date (MM/DD/YYYY).  Such Exercise Date must be (i) during the period (the “Vested Period”) at any time on or after the date the Vesting Date until the termination of the vested SARs in accordance with the terms and conditions of the Plan and the Agreement, (ii) prospective and (iii) no later than thirty (30) days following submission of the Election Form.  An Exercise Date is “prospective” if it is submitted to, and accepted and approved by, RAIT before the determination of the Fair Market Value on the relevant Exercise Date.  You may designate the Exercise Date that is the same date you submit the attached Election Form provided all the conditions specified above are met.  Your designation of the Exercise Date is irrevocable and is binding upon you and RAIT once it is accepted and approved by RAIT.  Settlement will be completed within five (5) business days of the Exercise Date.  Settlement will be made in cash, an equivalent value of Common Shares, or a combination of the two as determined in the sole discretion of the Committee.   

 

 

 

 

APPENDIX A

 

RAIT FINANCIAL TRUST

2012 INCENTIVE AWARD PLAN 

 SARS EXERCISE ELECTION FORM

 

I, a participant under the RAIT Financial Trust (“RAIT”) 2012 Incentive Award Plan (the “Plan”), or a person otherwise entitled to exercise the Share Appreciation Rights (“SARs”) thereunder, do hereby exercise the right to settlement of the following SARs on the date of exercise (the “Exercise Date”) identified below:

 

Exercise Date:_______________

Number of SARs:_______________

Date of Grant:02/22/2016

Date of Vesting:_______________

 

(The Exercise Date must comply with the conditions set forth in the Notice of Ability to Exercise Vested Share Appreciation Rights relating to these SARs.)  I understand that RAIT may reduce the amount paid to me as necessary to satisfy withholding tax obligations.  I further understand that RAIT may settle the exercised SARs in cash or in the equivalent value of Common Share of Beneficial Interest of RAIT, or a combination of the two as determined in the sole discretion of the Compensation Committee of the Board of Trustees of RAIT.  

 

Send a completed copy of this SAR Exercise Form to:

 

RAIT Financial Trust

Cira Center

2929 Arch Street, 17th Floor

Philadelphia, PA   19104

Attn:  Michele Rudoi

Human Resources

 

I understand that this election and the designation of the Exercise Date above are irrevocable once accepted and approved by RAIT.  

 

Print NameDate

 

Signature

 

 

 

 

ACCEPTED AND APPROVED ON BEHALF OF RAIT: 

 

 

By:   Name & Title:Dateras-ex104_7.htm

 

Exhibit 10.4

RAIT FINANCIAL TRUST

2012 INCENTIVE AWARD PLAN

Share Award Grant Agreement

This is a Share Award dated as of February 14, 2017 (the “Date of Grant”) from RAIT Financial Trust, a Maryland real estate investment trust (the “Company”), to [INSERT NAME] (“Participant” and, together with the Company, the “Parties”), under the terms of the RAIT Financial Trust 2012 Incentive Award Plan (the “Plan”).

1.Defined Terms.  Except as set forth below, all capitalized terms shall have the respective meaning as set forth in Section 1.02 of the Plan.  

(a)“Disability” shall mean the inability of a Participant to engage in any substantial gainful activity by reason of any medically determinable physical or mental impairment that can be expected to result in death or can be expected to last for a continuous period of not less than twelve months, as provided in Code section 409A(a)(2)(C) and Treas. Reg. § 1.409A-3(i)(4).  

(b)“Qualified Termination” means (1) termination of the Participant’s employment with the Company due to death or Disability or (2) an involuntary termination of the Participant’s employment with the Company, other than a termination for Cause (as defined in the Participant’s employment agreement or, if no such agreement is in force, as determined by the Company in its reasonable discretion).  

(c)“Restriction Period” means, with respect to each Common Share which is the subject of this Grant, the period beginning on the Date of Grant and ending on the applicable Vesting Date.

(d)“Retirement” means the Participant’s voluntary separation of employment following satisfaction of the Rule of 70. The Rule of 70 is satisfied upon (1) completion of at least fifteen (15) years of service with the Company or its related entities; (2) attainment of the age of fifty-five (55) and (3) such Participant’s combined age and service equals at least seventy (70). A Participant may separate upon Retirement subject to providing at least six (6) months’ advance notice to the Company and entering into a separate three-year non-competition and non-solicitation agreement, if requested by the Company. 

(e)“Share Award” means the [____] ([__]) Common Shares which are the subject of this Grant.

(f) “Vesting Date” means the date on which the Participant has a non-forfeitable right to the Common Shares and related dividends subject to this Share Award following the lapse of all restrictions set forth in Section 4.

2.Grant of Share Award.  Subject to the terms and conditions set forth herein, the Company hereby grants to Participant the Share Award and Participant hereby acknowledges the 

 

 

restrictions on the Share Award.  The Share Award is subject to the terms and conditions of the Plan now in effect and as they may be amended from time to time in accordance with the Plan.  The terms and conditions of the Plan are and automatically shall be incorporated herein by reference and made a part hereof.  

3.Restrictions on Share Award and Related Dividends.  Subject to the terms and conditions set forth in the Plan and herein and notwithstanding any other agreement to which the Participant is a party, during the Restriction Period, Participant shall not be permitted to sell, transfer, pledge, hypothecate, assign or otherwise dispose of the Common Shares and related dividends subject to this Share Award.  The Company or its transfer agent, American Stock Transfer & Trust Company, LLC or any successor thereto (“Transfer Agent”), shall maintain a record of uncertificated Common Shares and related dividends subject to this Share Award during the Restriction Period.  Any attempted sale, transfer, pledge, hypothecation, assignment or other disposition (each, a “Disposition”) of any  Common Shares and related dividends subject to this Share Award in violation of this Share Award shall be void and of no effect, and the Company (or Transfer Agent, as appropriate) shall have the right to disregard any such Disposition on its books and records, to issue (or execute) “stop transfer” instructions and/or take such other action as the Company deems necessary or advisable to enforce the restrictions in this Share Award.

4.Vesting.  Subject to Section 5, the restrictions set forth in Section 3 on the Share Award shall lapse with respect to the following portion of Common Shares and related dividends subject to the Share Award:  (i) one third (1/3) on the first anniversary of the Date of Grant; (ii) one third (1/3) on the second anniversary of the Date of Grant; and (iii) one third (1/3) on the third anniversary of the Date of Grant.  The date on which the restrictions lapse for a particular portion of the Share Award and related dividends shall be the Vesting Date for such portion. If the foregoing vesting schedule would produce fractional Common Shares, the number of Common Shares that are vested shall be rounded down to the nearest whole Restricted Unit; provided, however, that on the final vesting date, the number of Common Shares vesting shall be adjusted to the extent necessary so that 100% of the Share Award shall have vested.  On or before the thirtieth (30th) day following each Vesting Date, the Company will direct the Transfer Agent to note that the restrictions on the applicable Common Shares subject to this Share Award arising out of this Share Award have lapsed.

5.Forfeiture of Share Award.  If Participant’s employment or other service relationship with the Company and all Subsidiaries terminates during the Restriction Period for any reason other than a Qualified Termination or Retirement, Participant shall forfeit any remaining unvested Common Shares and related dividends subject to the Share Award as of the date of such termination of employment or other service relationship.  Upon a forfeiture of unvested Common Shares and related dividends subject to the Share Award as provided in this Section 5, the Share Award shall be deemed canceled and such Common Shares and dividends shall be transferred to the Company.  If Participant’s employment or other service relationship with the Company and all Subsidiaries terminates during the Restriction Period as a result of a Qualified Termination or Retirement, the restrictions on the unvested Share Award shall lapse as of the date of such termination of employment or other service relationship.

6.Lapse of Restrictions.  Upon the lapse of the Restriction Period with respect to the applicable Common Shares and related dividends subject to this Share Award, the Participant’s 

 

 

 

ability to hold, sell, transfer, pledge, assign or otherwise encumber the stock and dividends shall be unrestricted subject to the tax withholding requirements set forth in Paragraph 10(c). Notwithstanding the foregoing, Participant agrees to be bound by RAIT’s policy regarding the transfer of interests in the Company and acknowledges that such policy may limit the timing and manner in which Participant may sell or otherwise transfer any Common Shares issued by the Company pursuant to this Agreement. The RAIT Insider Trading Policy is attached to this Agreement. 

7.Dividends, Voting and Recapitalization.  

(a)Dividends.  Pursuant to Section 5.06 of the Plan, Participant shall be entitled to dividends attributable to Common Shares subject to this Share Award as follows:

(i)Dividends on Vested Common Shares.  With respect to Common Shares subject to this Share Award that have vested under Section 4, if any dividends are paid with respect to the Common Shares, Participant shall have the right to receive such dividends paid on such vested Common Shares in such amount and at such times as received by all other shareholders of the Company.  

 

(ii)Dividends on Unvested Common Shares.  With respect to Common Shares subject to this Share Award that have not vested under Section 4, if any dividends are paid with respect to the Common Shares, the Participant shall receive a credit to the Participant’s Share Award dividend account equal to the value of the cash dividends that would have been distributed if the unvested Common Shares at the time of the payment date of the relevant cash dividend were vested Common Shares.  Within thirty (30) days following the Vesting Date of any unvested Common Shares, a cash payment will be paid to the Participant by the Company equal to the value of the aggregate amount of cash credited to the Participant's Share Award dividend account for the corresponding unvested Common Shares that vested as of the Vesting Date.  No interest shall accrue with respect to any cash amounts credited to the Participant's Share Award dividend account.  If any unvested Common Shares are forfeited for any reason prior to the Vesting Date, the aggregate amount credited to the Participant's Share Award dividend account with respect to such unvested Common Shares shall terminate and the Participant shall not have any rights with respect to any such amounts.

 (b)Voting.  Participant shall have the right to vote all Common Shares under this Share Award regardless of vested status while such Common Shares remain outstanding and the Participant otherwise retains such voting rights.  

(c)Recapitalization.  In the event of any changes in the capital stock of the Company by reason of any stock dividends, split-ups or combinations of shares, reclassifications, mergers, consolidations, reorganizations or liquidations while any Common Shares comprising the Share Award shall be subject to restrictions on transfer and forfeiture hereunder, any and all new, substituted or additional securities to which Participant is entitled shall be subject immediately to the terms, conditions and restrictions of this Award.

8.Notices.  Any notice to the Company relating to this Share Award shall be addressed to the Company in care of the Chief Financial Officer of the Company at the principal 

 

 

 

office of the Company, and any notice to the Participant shall be addressed to such Participant at the current address shown on the payroll records of the Company, or to such other address as the Participant may designate to the Company in writing.  Any notice shall be delivered by hand, sent by telecopy or enclosed in a properly sealed envelope addressed as stated above, registered and deposited, postage prepaid, in a post office regularly maintained by the United States Postal Service.   

9.Applicable Laws.  The Company may from time to time impose any conditions on the Share Award as it deems necessary or advisable to ensure that the Award satisfies the conditions of applicable laws.

10.Tax Matters.  

(a)The Common Shares and related dividends subject to this Share Award are intended to constitute property that is subject to a substantial risk of forfeiture during the Restriction Period, and subject to federal income tax in accordance with Section 83 of the Code.  Section 83 of the Code generally provides that Participant will recognize compensation income with respect to each installment of the Share Award on such installment's Vesting Date in an amount equal to the then fair market value of the shares for which restrictions have lapsed.  Alternatively, Participant may elect, pursuant to Section 83(b) of the Code, to recognize compensation income for all or any part of the Share Award at the Date of Grant in an amount equal to the fair market value of the Share Award subject to the election on the Date of Grant.  Such election must be made within 30 days of the Date of Grant and Participant shall immediately notify the Company if such an election is made.  Participant should consult his or her tax advisors to determine whether a Section 83(b) election is appropriate.  If Participant (after consulting with his or her tax advisors) decides to file an 83(b) election, then instructions and an election form are attached hereto as Appendix A.

(b)The grant of this Share Award is intended to be exempt from the requirements of Section 409A of the Code, and, to the extent that further guidance is issued under Section 409A of the Code after the date of this Award, the Company may make any changes to this Award as are necessary to bring this award into compliance with the applicable exemptions under Section 409A of the Code and the Treasury regulations issued thereunder.

(c)The Participant shall be required to pay to the Company, or make other arrangements satisfactory to the Company to provide for the payment of, any federal, state, local or other taxes that the Company is required to withhold with respect to the grant, vesting or payment of the Common Shares and related dividends subject to this Share Award.  The Participant may elect to satisfy any tax withholding obligation of the Company with respect to the Common Shares and related dividends subject to this Share Award by having Common Shares and related dividends subject to this Share Award withheld up to an amount that does not exceed the minimum applicable withholding tax rate for federal (including FICA), state, local and other tax liabilities. 

11.Share Award Not to Affect Employment.  The Share Award granted hereunder shall not confer upon Participant any right to continue in the employment or other service relationship of the Company or any Subsidiary or affiliate of the Company.

 

 

 

12.Restrictions on Issuance or Transfer of Common Shares.

(a)The obligation of the Company to issue, or remove the restrictions on, Common Shares shall be subject to the condition that if at any time the Committee shall determine in its discretion that the listing, registration or qualification of the Common Shares upon any securities exchange or under any state or federal law, or the consent or approval of any governmental regulatory body is necessary or desirable as a condition of, or in connection with, such issuance or removal, the Common Shares may not be issued or such restrictions removed in whole or in part unless such listing, registration, qualification, consent or approval shall have been effected or obtained free of any conditions not acceptable to the Committee.  The issuance of Common Shares and the payment of cash to the Participant pursuant to this Agreement are subject to any applicable taxes and other laws or regulations of the United States or of any state having jurisdiction thereof. 

(b)The Participant agrees to be bound by the Company’s policies regarding the transfer of the Common Shares subject to this Share Award and understands that there may be certain times during the year in which the Participant will be prohibited from selling, transferring, pledging, donating, assigning, mortgaging, or encumbering Common Shares. 

13.Miscellaneous.

(a)Binding Effect. Subject to the limitations set forth herein, this Award shall inure to the benefit of and be binding upon the Parties hereto and their respective heirs, legal representatives, successors and assigns.

(b)Entire Agreement; Amendments.  This Award and the Plan constitute the entire agreement between the parties with respect to the Award and cannot be changed or terminated orally.  No modification or waiver of any of the provisions hereof shall be effective unless in writing and signed by the party against whom it is sought to be enforced.

(c)Counterparts.  This Award may be executed in one or more counterparts, both of which taken together shall constitute one and the same agreement.

(d)Governing Law.  This Award shall be governed and construed and the legal relationships of the parties determined in accordance with the internal laws of the State of Maryland.  

(e)Severability.  In the event that any provision in this Award shall be held invalid or unenforceable, such provision shall be severable from, and such invalidity or unenforceability shall not be construed to have any effect on, the remaining provisions of this Award.

(f)Section Headings.  The captions and section headings of this Award are for convenience of reference only and shall not be deemed to alter or affect any provision hereof.

 

 

 

 

IN WITNESS WHEREOF, RAIT has caused its duly authorized officer to execute this Share Award Grant Agreement, and Participant has placed his or her signature hereon, effective as of the Date of Grant.

RAIT FINANCIAL TRUST

 

By:______________________________

Name:

Title:

 

 

ACKNOWLEDGMENT

 

The Participant acknowledges receipt of the Share Award, a copy of which is attached hereto; represents that he or she has read and is familiar with the terms and provisions thereof; hereby accepts this Share Award subject to all of the terms and provisions thereof.  The Participant hereby agrees to accept as binding, conclusive and final all decisions or interpretations of the Committee upon any questions arising hereunder. 

Date:
Signature of Participant

Name of Participant

 

 

 

 

 

 

 

 SECTION 83(b) ELECTIONS

 

 

INSTRUCTIONS REGARDING SECTION 83(b) ELECTIONS:

 

	
1.
	
An 83(b) Election is Irrevocable.

	
2.
	
If you choose to make an 83(b) Election, an 83(b) Election Form must be filed with the Internal Revenue Service within 30 days after the date the Share Award is made to you.  No exceptions to this rule are made.

	
3.
	
You must provide a copy of the 83(b) Election Form to the General Counsel or other designated officer of the Company.  This copy should be provided to the Company at the same time that you file your 83(b) Election Form with the Internal Revenue Service.

	
4.
	
In addition to making the filing under Item 2 above, you must attach a copy of your 83(b) Election Form to your tax return for the taxable year in which you received the restricted stock.

	
5.
	
If you make an 83(b) Election and later forfeit the Common Shares, you will not be entitled to a deduction with respect to the gross income you recognized under the 83(b) Election.

 

You are urged to consult your personal tax advisor before making an 83(b) Election to discuss the consequences thereof and consider whether such an election is advisable under the circumstances (and to complete the election form).

 

 

 

APPENDIX A

SECTION 83(b) ELECTION FORM

 

Election Pursuant to Section 83(b) of the Internal Revenue Code

to Include Property in Gross Income in Year of Transfer

 

The undersigned hereby makes an election pursuant to Section 83(b) of the Internal Revenue Code with respect to the Share Award described below and supplies the following information in accordance with the regulations promulgated thereunder:

1.The name, address, and taxpayer identification number of the undersigned are:

______________________________

______________________________

______________________________

___-__-____

2.Description of the Share Award with respect to which the election is being made:  ______ (__) Common Shares of Beneficial Interest, par value of $0.03 of RAIT Financial Trust awards pursuant to the attached Share Award and the RAIT Financial Trust 2012 Incentive Award Plan.  

3.Date on which the Share Award is made: February 22, 2016.  

4.The taxable year of the taxpayer is 2016.

5.Nature of restrictions to which the Share Award is subject:  The Share Award consists of Common Shares subject to potential forfeiture for (i) failure to remain employed by the Company during the Restriction Period; or (ii) failure to comply with the restrictions and conditions of the Share Award and the Plan.  

6.The fair market value of a Common Share on the Date of Grant (determined without regard to any restrictions other than restrictions which by their terms will never lapse) of the property with respect to which this election is being made is:  $3.78, the NYSE per Common Share closing price on the Date of Grant.  The cumulative fair market value of Common Shares subject to this Grant Award is $_________  (2. multiplied by 6.).

7.The taxpayer did not pay any amount for these shares.

8.A copy of this statement was furnished to RAIT Financial Trust, for whom taxpayer rendered the services underlying the transfer of such property.

 

Date: ___________________________________________

Name:

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