The first step in Jeremy Lin's expected exit from New York is now official.

The Knicks announced tonight that the team has re-acquired guard Raymond Felton, via sign-and trade, and forward/center Kurt Thomas from the Portland Trail Blazers in exchange for forward Jared Jeffries, via sign-and-trade, center Dan Gadzuric, the draft rights to Kostas Papanikolaou and Giorgos Printezis and a protected future second-round draft pick.

The move to bring back Felton is expected to result in the Knicks not matching the Rockets' $25.1 million free agent offer for Lin. The Rockets believe the deadline for the Knicks to make a decision is tomorrow at 11:59 p.m.

Felton, 6-1, 205-pounds, averaged 11.4 points, 6.5 assists, 2.5 rebounds and 1.30 steals over 31.8 minutes in 60 games (56 starts) with the Trail Blazers last season. During the 2010-11 season, Felton started all 54 games he appeared in for the Knicks to average 17.1 points and 9.0 assists over 38.4 minutes, before a trade sent him to the Nuggets on Feb. 22, 2011.

If Lin doesn't return, Felton, who sources say received a three-year $10 million deal, is expected to battle Jason Kidd for minutes as the Knicks' No. 1 point guard. Kidd, who last week signed a 3-year, $9 million deal, was arrested early Sunday morning in Water Mill, LI, and charged with DWI.

Thomas, 6-9, 235-pounds and a 17-year NBA veteran, holds career averages of 8.3 points and 6.8 rebounds over 1,071 games with Miami, Dallas, the Knicks, Phoenix, Seattle, San Antonio, Milwaukee, Chicago and Portland.

Thomas played for the Knicks for seven seasons from 1998-2005, and currently ranks 19th on the franchise’s all-time scoring list, eighth in rebounds, fourth in blocked shots and 11th in point-rebound double-doubles, and is one of only 17 players to have appeared in at least 500 games for New York..