RAIT INVESTMENT TRUST
EMPLOYMENT AGREE., BETSY Z. COHEN (CORRECTED)
<DOCUMENT>
<TYPE>EX-10.3
<SEQUENCE>3
<FILENAME>w83630exv10w3.txt
<DESCRIPTION>EMPLOYMENT AGREE., BETSY Z. COHEN (CORRECTED)
<TEXT>
<PAGE>
                                                                    EXHIBIT 10.3


           Employment Agreement between Betsy Z. Cohen and Registrant

         THIS EMPLOYMENT AGREEMENT (the "Agreement") entered into as of January
23, 2002 by and between RAIT Investment Trust, a Maryland real estate investment
trust (the "Company"), with a principal office in Philadelphia, Pennsylvania,
and Betsy Cohen ("Executive").

         WHEREAS, Executive desires to continue employment with the Company, and
the Company desires to continue to employ Executive upon the terms and
conditions hereinafter set forth;

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

         1.       Employment. The Company continues to employ Executive, and
Executive hereby accepts such continued employment and agrees to perform
Executive's duties and responsibilities, in accordance with the terms,
conditions and provisions hereinafter set forth.

                  1.1.     Employment Term. This Agreement shall be effective as
of October 1, 2001 (the "Effective Date"), and shall continue for five years,
until September 30, 2006, unless the Agreement is terminated sooner in
accordance with Section 2 or 3 below. In addition, the term of the Agreement
shall automatically renew daily so that it is at all times for a five year
period. The period commencing on the Effective Date and ending on the date on
which the term of Executive's employment under the Agreement shall terminate is
hereinafter referred to as the "Employment Term."

                  1.2.     Duties and Responsibilities. Commencing on the
Effective Date, Executive shall serve as the Chairman of the Board and Chief
Executive Officer of the Company. Executive shall perform all duties and accept
all responsibilities incident to such position as may be reasonably assigned to
her by the Board of Trustees of the Company (the "Board"). In addition, the
Executive shall serve as a member of the Board during the Employment Term.

                  1.3.     Extent of Service. Executive agrees to use
Executive's best efforts to carry out Executive's duties and responsibilities
under Section 1.2 hereof and, consistent with the other provisions of this
Agreement, to devote such business time, attention and energy thereto as is
reasonably necessary to carry out those duties and responsibilities. The
foregoing shall not be construed as preventing Executive from providing service
to, or making investments in, other businesses or enterprises provided there is
no conflict with Executive's ability to satisfy her obligations to the Company.


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<PAGE>
                  1.4.     Base Salary. For all the services rendered by
Executive hereunder, the Company shall pay Executive a base salary ("Base
Salary"), commencing on the Effective Date, at the annual rate of $450,000,
payable in installments at such times as the Company customarily pays its other
senior level executives. Executive's Base Salary shall be reviewed annually for
appropriate increases by the Board pursuant to the Board's normal performance
review policies for senior level executives but shall not be decreased.

                  1.5.     Bonus. Executive shall be eligible to receive annual
bonuses in such amounts as the Board may approve in its sole discretion or under
the terms of any annual incentive plan of the Company maintained for other
senior level executives.

                  1.6.     Retirement and Welfare Plans and Perquisites.

                  (a)      Executive shall be entitled to participate in all
employee retirement and welfare benefit plans and programs or executive
perquisites made available to the Company's senior level executives as a group
or to its employees generally, as such retirement and welfare plans or
perquisites may be in effect from time to time and subject to the eligibility
requirements of the plans. Nothing in this Agreement shall prevent the Company
from amending or terminating any retirement, welfare or other employee benefit
plans or programs from time to time as the Company deems appropriate.

                  (b)      The Company shall provide and maintain on Executive's
behalf a supplemental executive retirement plan (the "SERP") in accordance with
the terms and conditions described on Exhibit A attached hereto. Executive shall
be fully vested in the amount of the SERP benefit earned and it shall be fully
accrued upon Executive's attainment of age 65, except as otherwise
provided below. Executive shall also be fully vested in the amount of the SERP
benefit otherwise due at age 65 upon the occurrence of a Change of
Control (as defined in Section 4) or in the event the Executive is terminated
without Cause (as defined in Section 4) or resigns for Good Reason (as defined
in Section 4). The Company shall establish a rabbi trust to serve as the funding
vehicle for the benefits described in this paragraph, and shall make
contributions to the trust in such amounts or in such number of shares of stock
of the Company as the Company reasonably determines to be sufficient to provide
the present value of the benefit as accrued at the time of the contribution, as
determined in accordance with the parameters described in Exhibit A. Upon the
occurrence of a Change of Control, the Company shall immediately contribute to
the trust an amount sufficient to permit the full payment of the benefit due to
Executive at age 65. Notwithstanding the establishment of a rabbi trust, the
Company's obligation to pay the benefit shall constitute a general, unsecured
obligation, payable out of its general assets, and the Executive shall not have
any rights to any specific asset of the Company. The Executive or her
beneficiary shall have only the rights of a general, unsecured creditor against
the Company for any distributions due under this paragraph, and the assets of
the rabbi trust shall be available to pay the claims of the Company's creditors.


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<PAGE>
                  1.7.     Reimbursement of Expenses; Vacation. Executive shall
be provided with reimbursement of reasonable expenses related to Executive's
employment by the Company on a basis no less favorable than that which may be
authorized from time to time for senior level executives as a group, and shall
be entitled to vacation and sick leave in accordance with the Company's
vacation, holiday and other pay for time not worked policies.

                  1.8.     Incentive Compensation. Executive shall be entitled
to participate in any short-term and long-term incentive programs (including
without limitation any stock option plans) established by the Company for its
senior level executives generally, at levels commensurate with the benefits
provided to other senior executives and with adjustments appropriate for her
position as Chairman of the Board and Chief Executive Officer.

         2.       Termination. Executive's employment shall terminate upon the
occurrence of any of the following events:

                  2.1.     Termination Without Cause; Resignation for Good
Reason

                  (a)      The Company may remove Executive at any time without
Cause (as defined in Section 4) from the position in which Executive is employed
hereunder upon not less than sixty (60) days' prior written notice to Executive;
provided, however, that, that in the event that such notice is given, Executive
shall be under no obligation to render any additional services to the Company
and shall be allowed to seek other employment. In addition, Executive may
initiate a termination of employment by resigning under this Section 2.1 for
Good Reason (as defined in Section 4). Executive shall give the Company not less
than 60 days' prior written notice of such resignation.

                  (b)      Upon any removal or resignation described in Section
2.1(a) above, Executive shall be entitled to receive only the amount due to
Executive under the Company's then current severance pay plan for employees, if
any. No other payments or benefits shall be due under this Agreement to
Executive, but Executive shall be entitled to any benefits accrued and earned in
accordance with the terms of any applicable benefit plans and programs of the
Company.

                  (c)      Notwithstanding the provisions of Section 2.1(b), in
the event that Executive executes and does not revoke a written mutual release
upon such removal, resignation or Non-Renewal, in a form acceptable to the
Company (the "Release"), of any and all claims against the Company and all
related parties with respect to all matters arising out of Executive's
employment by the Company, or the termination thereof (other than claims for any
entitlements under the terms of this Agreement or under any plans or programs of
the Company under which Executive has accrued and is due a benefit), and any
claims against Executive for actions within the scope of her employment by the
Company, Executive shall be entitled to receive, in lieu of the payment
described in Section 2.1(b), the following:

                           (i)      Executive shall receive a lump sum cash
payment equal to the Executive's Base Salary payable over the remaining portion
of the Employment Term, at the rate in effect immediately before Executive's
termination of employment


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<PAGE>
and (y) a pro rated bonus, if any, for the year in which Executive's termination
of employment occurs. The pro rated bonus shall be based on the amount of
Executive's annual bonus, if any, for the fiscal year in which Executive's
termination occurs, multiplied by a fraction, the numerator of which is the
number of days during which Executive was employed by the Company in the fiscal
year of her termination and the denominator of which is three hundred sixty-five
(365). Payment shall be made within thirty (30) days after the effective date of
the termination or the end of the revocation period for the Release, if later.

                           (ii)     For a period of 18-months following the date
of termination, Executive shall continue to receive the medical coverage in
effect at the date of her termination (or generally comparable coverage) for
herself and, where applicable, her spouse and dependents, as the same may be
changed from time to time for employees generally, as if Executive had continued
in employment during such period; or, as an alternative, the Company may elect
to pay Executive cash in lieu of such coverage in an amount equal to Executive's
after-tax cost of continuing such coverage, where such coverage may not be
continued (or where such continuation would adversely affect the tax status of
the plan pursuant to which the coverage is provided). The COBRA health care
continuation coverage period under section 4980B of the Internal Revenue Code of
1986, as amended, shall run concurrently with the foregoing 18-month benefit
period.

                           (iii)    Executive shall also receive any other
amounts earned, accrued and owing but not yet paid under Section 1 above.

                  2.2.     Voluntary Termination. Executive may voluntarily
terminate her employment for any reason upon 30 days' prior written notice. In
such event, after the effective date of such termination, except as provided in
Section 2.1 with respect to a resignation for Good Reason, no further payments
shall be due under this Agreement, except that Executive shall be entitled to
any benefits accrued and due in accordance with the terms of any applicable
benefit plans and programs of the Company.

                  2.3.     Disability. The Company may terminate Executive's
employment if Executive has been unable to perform the material duties of her
employment for a period of ninety (90) consecutive days in any 12-month period
because of physical or mental injury or illness ("Disability"); provided,
however, that the Company shall continue to pay Executive's Base Salary until
the Company acts to terminate Executive's employment. Executive agrees, in the
event of a dispute under this Section 2.3 relating to Executive's Disability, to
submit to a physical examination by a licensed physician jointly selected by the
Board and Executive. If the Company terminates Executive's employment for
Disability, Executive shall be entitled to receive the following:


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<PAGE>
                  (a)      If the Executive's employment terminates on account
of Disability on or before the third anniversary of the Executive's Effective
Date, the Company shall continue to pay to Executive the amount of her Base
Salary in effect as of the date of her Disability until December 31, 2006.

                  (b)      If the Executive's employment terminates on account
of Disability at any time after the third anniversary of the Executive's
Effective Date, the vesting of the SERP shall accelerate and the Executive shall
be with credited years of service, for purposes of the SERP, as if she remained
employed by the Company through her sixty-fifth birthday.

                  (c)      Any amounts payable pursuant to this Section 2.3
shall be offset by any amounts the Executive receives under the Company's
long-term disability plan.

                  (d)      Executive shall also receive (i) any other amounts
earned, accrued and owing but not yet paid under Section 1 above and any
benefits accrued and earned in accordance with the terms of any applicable
benefit plans and programs of the Company and (ii) a pro rated bonus, if any,
for the year in which Executive's Disability occurs, which bonus shall be
calculated according to Section 2.1(c)(i) above.

                  2.4.     Death. If Executive dies while employed by the
Company, the Company shall pay to Executive's executor, legal representative,
administrator or designated beneficiary, as applicable, (i) any amounts earned,
accrued and owing but not yet paid under Section 1 above and any benefits
accrued and earned under the Company's benefit plans and programs and (ii) a pro
rated bonus, if any, for the year in which Executive's death occurs, which bonus
shall be calculated according to Section 2.1(c)(i) above. Otherwise, the Company
shall have no further liability or obligation under this Agreement to
Executive's executors, legal representatives, administrators, heirs or assigns
or any other person claiming under or through Executive.

                  2.5.     Cause. The Company may terminate Executive's
employment at any time for Cause upon written notice to Executive, in which
event all payments under this Agreement shall cease, except for Base Salary to
the extent already accrued. Executive shall be entitled to any benefits accrued
and earned before her termination in accordance with the terms of any applicable
benefit plans and programs of the Company.

                  2.6.     Notice of Termination. Any termination of Executive's
employment shall be communicated by a written notice of termination to the other
party hereto given in accordance with Section 10. The notice of termination
shall (i) indicate the specific termination provision in this Agreement relied
upon, (ii) briefly summarize the facts and circumstances deemed to provide a
basis for a termination of employment and the applicable provision hereof, and
(iii) specify the termination date in accordance with the requirements of this
Agreement.

         3.       Change of Control.

                  3.1.     Effect of Change of Control. If a Change of Control
occurs and Executive's employment terminates under the circumstances described
below, the provisions of Section 2.1 shall apply.


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<PAGE>
                  3.2.     Termination Without Cause Upon or After a Change of
Control. Upon or after a Change of Control, the Company (by action of the Board)
may remove Executive at any time without Cause from the position in which
Executive is employed hereunder or Executive may initiate termination of
employment by resigning under this Section 3 for Good Reason (as defined in
Section 4) (in either case the Employment Term shall be deemed to have ended)
upon not less than 60 days' prior written notice to Executive (or in the
case of resignation for Good Reason, Executive shall give the Company not less
than 60 days' prior written notice of such resignation); provided,
however, that, in the event that such notice is given, Executive shall be under
no obligation to render any additional services to the Company and shall be
allowed to seek other employment. In any such event, the provisions of Section
2.1(b) or (c), as applicable, shall then apply.

         4.       Definitions.

                  (a)      "Cause" shall mean any of the following grounds for
termination of Executive's employment:

                           (i)      Executive shall have been convicted of a
felony,

                           (ii)     Executive intentionally and continually
fails substantially to perform her reasonably assigned material duties to the
Company (other than a failure resulting from Executive's incapacity due to
physical or mental illness), which failure has been materially and demonstrably
detrimental to the Company and has continued for a period of at least
30 days after a written notice of demand for substantial performance, signed
by a duly authorized officer of the Company, has been delivered to Executive
specifying the manner in which Executive has failed substantially to perform,

                           (iii)    Executive breaches Section 5 of this
Agreement.

                  (b)      "Good Reason" shall mean the occurrence of any of the
following events or conditions, unless Executive has expressly consented in
writing thereto or unless the event is remedied by the Company promptly after
receipt of notice thereof given by Executive:

                           (i)      a reduction in Executive's Base Salary;

                           (ii)     a demotion of Executive;

                           (iii)    a material reduction of Executive's duties
hereunder;

                           (iv)     the Company's requiring Executive to be
based at a location other than in the Philadelphia, Pennsylvania metropolitan
area;

                           (v)      the failure of the Executive to be elected
to the Board; or

                           (vi)     any material breach of this Agreement by the
Company.


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<PAGE>
                  (c)   Change of Control. As used herein, a "Change of Control"
shall be deemed to have occurred if:

                         (i)       Any "person" (as such term is used in
sections 13(d) and 14(d) of the Securities Exchange Act of 1934 (the "Exchange
Act")) (other than persons who are shareholders on the effective date of the
Plan) becomes a "beneficial owner" (as defined in Rule 13d-3 under the Exchange
Act), directly or indirectly, of securities of the Company representing more
than 50% of the voting power of the then outstanding securities of the Company;
provided that a Change of Control shall not be deemed to occur as a result of a
change of ownership resulting from the death of a shareholder, and a Change of
Control shall not be deemed to occur as a result of a transaction in which the
Company becomes a subsidiary of another corporation and in which the
shareholders of the Company immediately prior to the transaction, will
beneficially own, immediately after the transaction, shares entitling such
shareholders to more than 50% of all votes to which all shareholders of the
parent corporation would be entitled in the election of directors (without
consideration of the rights of any class of stock to elect directors by a
separate class vote);

                         (ii)      The consummation of (i) a merger or
consolidation of the Company with another corporation where the shareholders of
the Company, immediately prior to the merger or consolidation, will not
beneficially own, immediately after the merger or consolidation, shares
entitling such shareholders to more than 50% of all votes to which all
shareholders of the surviving corporation would be entitled in the election of
directors (without consideration of the rights of any class of stock to elect
directors by a separate class vote), (ii) a sale or other disposition of all or
substantially all of the assets of the Company, or (iii) a liquidation or
dissolution of the Company; or

                         (iii)     The individuals who, as of the date of this
Agreement, are members of the Board (the "Incumbent Board") cease for any
reason to constitute at least two-thirds of the Board; provided, however, that
if either the election of any new trustee or the nomination for election of any
new director by the Company's stockholders was approved by a vote of at least
two-thirds of the Incumbent Board prior to such election or nomination, such
new director shall be considered as a member of the Incumbent Board; provided
further, however, that no individual shall be considered a member of the
Incumbent Board if such individual initially assumed office as a result of
either an actual or threatened "Election Contest" (as described in Rule 14a-11
promulgated under the Exchange Act) or other actual or threatened solicitation
of proxies or consents by or on behalf of a Person other than the Board (a
"Proxy Contest") including by reason of any agreement intended to avoid or
settle any Election Contest or Proxy Contest.

For purposes of the preceding definition, "Company" shall include the Company
and its parent and/or subsidiaries.

         5.    Intellectual Property and Confidentiality. Executive hereby
acknowledges that, during and solely as a result of her employment by the
Company, Executive will receive special training and education with respect to
the operation of the Company's business and other related matters, and access to
confidential information and business and professional contacts. In
consideration of Executive's employment and in consideration of the special and
unique opportunities afforded by the Company to Executive as a result of
Executive's employment, Executive hereby agrees to abide by the terms of the
non-competition, non-solicitation, intellectual property and confidentiality
provisions below. Executive agrees and acknowledges that her employment is full,
adequate and sufficient consideration for the restrictions and obligations set
forth in those provisions.


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<PAGE>
                  5.1.     Developments. Executive shall disclose fully,
promptly and in writing to the Company any and all inventions, discoveries,
improvements, modifications and other intellectual property rights, whether
patentable or not, which Executive has conceived, made or developed, solely or
jointly with others, while employed by the Company and which (i) relate to the
business, work or activities of the Company or (ii) result from or are suggested
by the carrying out of Executive's duties hereunder or from or by any
information that Executive may receive as an employee of the Company. Executive
hereby assigns, transfers and conveys to the Company all of Executive's right,
title and interest in and to any and all such inventions, discoveries,
improvements, modifications and other intellectual property rights and agrees to
take all such actions as may be requested by the Company at any time and with
respect to any such invention, discovery, improvement, modification or other
intellectual property rights to


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<PAGE>
confirm or evidence such assignment, transfer and conveyance. Furthermore, at
any time and from time to time, upon the request of the Company, Executive shall
execute and deliver to the Company, any and all instruments, documents and
papers, give evidence and do any and all other acts that, in the opinion of
counsel for the Company, are or may be necessary or desirable to document such
assignment, transfer and conveyance or to enable the Company to file and
prosecute applications for and to acquire, maintain and enforce any and all
patents, trademark registrations or copyrights under United States or foreign
law with respect to any such inventions, discoveries, improvements,
modifications or other intellectual property rights or to obtain any extension,
validation, reissue, continuance or renewal of any such patent, trademark or
copyright. The Company shall be responsible for the preparation of any such
instruments, documents and papers and for the prosecution of any such
proceedings and shall reimburse Executive for all reasonable expenses incurred
by Executive in compliance with the provisions of this Section 5.1.

                  5.2.     Confidentiality.

                  (a)      Executive acknowledges that, by reason of Executive's
employment by the Company, Executive will have access to confidential
information of the Company, including, without limitation, information and
knowledge pertaining to products, inventions, discoveries, improvements,
innovations, designs, ideas, trade secrets, proprietary information,
manufacturing, packaging, advertising, distribution and sales methods, sales and
profit figures, customer and client lists and relationships between the Company
and dealers, distributors, sales representatives, wholesalers, customers,
clients, suppliers and others who have business dealings with them
("Confidential Information"). Executive acknowledges that such Confidential
Information is a valuable and unique asset of the Company and covenants that,
both during and after the Employment Term, Executive will not disclose any
Confidential Information to any person (except as Executive's duties as an
officer of the Company may require or as required by law or in a judicial or
administrative proceeding) without the prior written authorization of the Board.
The obligation of confidentiality imposed by this Section 5.2 shall not apply to
information that becomes generally known to the public through no act of
Executive in breach of this Agreement.

                  (b)      Executive acknowledges that all documents, files and
other materials received from the Company during the Employment Term (with the
exception of documents relating to Executive's compensation or benefits to which
Executive is entitled following the Employment Term) are for use of Executive
solely in discharging Executive's duties and responsibilities hereunder and that
Executive has no claim or right to the continued use or possession of such
documents, files or other materials following termination of Executive's
employment by the Company. Executive agrees that, upon termination of
employment, Executive will not retain any such documents, files or other
materials and will promptly return to the Company any documents, files or other
materials in Executive's possession or custody.

                  5.3.     Equitable Relief. Executive acknowledges that the
restrictions contained in Sections 5.1 and 5.2 hereof are, in view of the
nature of the business of the Company, reasonable and necessary to protect the
legitimate interests of the Company, and that any violation of any provision of
those Sections will result in irreparable injury to the Company. Executive also


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<PAGE>
acknowledges that in the event of any such violation, the Company shall be
entitled to preliminary and permanent injunctive relief, without the necessity
of proving actual damages, and to an equitable accounting of all earnings,
profits and other benefits arising from any such violation, which rights shall
be cumulative and in addition to any other rights or remedies to which the
Company may be entitled. Executive agrees that in the event of any such
violation, an action may be commenced for any such preliminary and permanent
injunctive relief and other equitable relief in any federal or state court of
competent jurisdiction sitting in Pennsylvania or in any other court of
competent jurisdiction. Executive hereby waives, to the fullest extent permitted
by law, any objection that Executive may now or hereafter have to such
jurisdiction or to the laying of the venue of any such suit, action or
proceeding brought in such a court and any claim that such suit, action or
proceeding has been brought in an inconvenient forum. Executive agrees that
effective service of process may be made upon Executive by mail under the notice
provisions contained in Section 10 hereof.

         6.       Non-Exclusivity of Rights. Nothing in this Agreement shall
prevent or limit Executive's continuing or future participation in or rights
under any benefit, bonus, incentive or other plan or program provided by the
Company and for which Executive may qualify; provided, however, that if
Executive becomes entitled to and receives the payments provided for in Section
2.1(b) or (c) of this Agreement, Executive hereby waives Executive's right to
receive payments under any severance plan or similar program applicable to all
employees of the Company.

         7.       Survivorship. The respective rights and obligations of the
parties under this Agreement shall survive any termination of Executive's
employment to the extent necessary to the intended preservation of such rights
and obligations.

         8.       Mitigation. Executive shall not be required to mitigate the
amount of any payment or benefit provided for in this Agreement by seeking other
employment or otherwise and there shall be no offset against amounts due
Executive under this Agreement on account of any remuneration attributable to
any subsequent employment that Executive may obtain.

         9.       Arbitration; Expenses. In the event of any dispute under the
provisions of this Agreement, other than a dispute in which the primary relief
sought is an equitable remedy such as an injunction, the parties shall be
required to have the dispute, controversy or claim settled by arbitration in
Philadelphia, Pennsylvania in accordance with the National Rules for the
Resolution of Employment Disputes then in effect of the American Arbitration
Association, before a panel of three arbitrators, two of whom shall be selected
by the Company and Executive, respectively, and the third of whom shall be
selected by the other two arbitrators. Any award entered by the arbitrators
shall be final, binding and nonappealable and judgment may be entered thereon by
either party in accordance with applicable law in any court of competent
jurisdiction. This arbitration provision shall be specifically enforceable. The
arbitrators shall have no authority to modify any provision of this Agreement or
to award a remedy for a dispute involving this Agreement other than a benefit
specifically provided under or by virtue of the Agreement. Each party shall be
responsible for its own expenses relating to the conduct of the arbitration
(including reasonable attorneys' fees and expenses) and shall share the fees of
the American Arbitration Association.


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<PAGE>
         10.      Notices. All notices and other communications required or
permitted under this Agreement or necessary or convenient in connection herewith
shall be in writing and shall be deemed to have been given when hand delivered
or mailed by registered or certified mail, as follows (provided that notice of
change of address shall be deemed given only when received):

         IF TO THE COMPANY, TO:

                  RAIT Investment Trust
                  1818 Market Street
                  Philadelphia, PA 19103

         With a required copy to:

                  Morgan, Lewis & Bockius LLP
                  1701 Market Street
                  Philadelphia, PA 19103-2921
                  Attention: Robert J. Lichtenstein, Esquire

         IF TO EXECUTIVE, TO:

                  Betsy Cohen
                  [Address Omitted]

or to such other names or addresses as the Company or Executive, as the case may
be, shall designate by notice to each other person entitled to receive notices
in the manner specified in this Section.

         11.      Contents of Agreement; Amendment and Assignment.

                  (a)      This Agreement sets forth the entire understanding
between the parties hereto with respect to the subject matter hereof and cannot
be changed, modified, extended or terminated except upon written amendment
approved by the Board and executed on its behalf by a duly authorized officer
and by Executive.

                  (b)      All of the terms and provisions of this Agreement
shall be binding upon and inure to the benefit of and be enforceable by the
respective heirs, executors, administrators, legal representatives, successors
and assigns of the parties hereto, except that the duties and responsibilities
of Executive under this Agreement are of a personal nature and shall not be
assignable or delegatable in whole or in part by Executive. The Company shall
require any successor (whether direct or indirect, by purchase, merger,
consolidation, reorganization or otherwise) to all or substantially all of the
business or assets of the Company, within 15 days of such succession, expressly
to assume and agree to perform this Agreement in the same manner and to the same
extent as the Company would be required to perform if no such succession had
taken place.


                                       11
<PAGE>
         12.      Severability. If any provision of this Agreement or
application thereof to anyone or under any circumstances is adjudicated to be
invalid or unenforceable in any jurisdiction, such invalidity or
unenforceability shall not affect any other provision or application of this
Agreement which can be given effect without the invalid or unenforceable
provision or application and shall not invalidate or render unenforceable such
provision or application in any other jurisdiction. If any provision is held
void, invalid or unenforceable with respect to particular circumstances, it
shall nevertheless remain in full force and effect in all other circumstances.

         13.      Remedies Cumulative; No Waiver. No remedy conferred upon a
party by this Agreement is intended to be exclusive of any other remedy, and
each and every such remedy shall be cumulative and shall be in addition to any
other remedy given under this Agreement or now or hereafter existing at law or
in equity. No delay or omission by a party in exercising any right, remedy or
power under this Agreement or existing at law or in equity shall be construed as
a waiver thereof, and any such right, remedy or power may be exercised by such
party from time to time and as often as may be deemed expedient or necessary by
such party in its sole discretion.

         14.      Beneficiaries/References. Executive shall be entitled, to the
extent permitted under any applicable law, to select and change a beneficiary or
beneficiaries to receive any compensation or benefit payable under this
Agreement following Executive's death by giving the Company written notice
thereof. In the event of Executive's death or a judicial determination of
Executive's incompetence, reference in this Agreement to Executive shall be
deemed, where appropriate, to refer to Executive's beneficiary, estate or other
legal representative.

         15.      Miscellaneous. All section headings used in this Agreement are
for convenience only. This Agreement may be executed in counterparts, each of
which is an original. It shall not be necessary in making proof of this
Agreement or any counterpart hereof to produce or account for any of the other
counterparts.

         16.      Withholding. All payments under this Agreement shall be made
subject to applicable tax withholding, and the Company shall withhold from any
payments under this Agreement all federal, state and local taxes as the Company
is required to withhold pursuant to any law or governmental rule or regulation.
Except as specifically provided otherwise in this Agreement, Executive shall
bear all expense of, and be solely responsible for, all federal, state and local
taxes due with respect to any payment received under this Agreement.

         17.      Governing Law. This Agreement shall be governed by and
interpreted under the laws of the Commonwealth of Pennsylvania without giving
effect to any conflict of laws provisions.


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<PAGE>
         IN WITNESS WHEREOF, the undersigned, intending to be legally bound,
have executed this Agreement as of the date first above written.

                                      RAIT INVESTMENT TRUST


                                      By:  /s/ Scott F. Schaeffer
                                          --------------------------------------
                                      Name:    Scott F. Schaeffer
                                            ------------------------------------
                                      Title:   President
                                             -----------------------------------




                                      /s/ Betsy Z. Cohen
                                      ------------------------------------------
                                      EXECUTIVE


                                       13

</TEXT>
</DOCUMENT>
