Exhibit 10.1

 

Execution Copy

 

REGISTRATION RIGHTS AGREEMENT

 

by

 

iStar Financial Inc.,

 

and

 

Merrill Lynch, Pierce, Fenner & Smith Incorporated
Barclays Capital Inc.
J.P. Morgan Securities LLC

 

Dated as of May 8, 2012

 

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REGISTRATION RIGHTS AGREEMENT

 

This Registration Rights Agreement (this “Agreement”) is made and entered into
as of May 8, 2012, by and among iStar Financial Inc., a Maryland corporation
(the “Company”) and the Initial Purchasers (as defined in the Purchase Agreement
(as defined below)), relating to the Company’s offering and sale of its 9.0%
Senior Notes due 2017 (the “Securities”) to be issued on May 8, 2012 pursuant to
the terms of the indenture, dated as of May 8, 2012 (as the same may be further
amended or supplemented from time to time in accordance with the terms thereof,
the “Indenture”), between the Company and U.S. Bank National Association, as
trustee (in such capacity, the “Trustee”).  In connection with the offering and
sale of the Securities, the Company is executing this Agreement for the benefit
of the holders from time to time of Transfer Restricted Securities (as defined
below).  The execution and delivery of this Agreement is a condition set forth
in Section 5(g) of the Purchase Agreement, dated May 3, 2012 (the “Purchase
Agreement”), among the Company and the Initial Purchasers.

 

The parties hereby agree as follows:

 

SECTION 1.                            Definitions.

 

As used in this Agreement, the following capitalized terms shall have the
following meanings:

 

Additional Interest:  As defined in Section 5 hereto.

 

Additional Interest Payment Date:  With respect to Transfer Restricted
Securities, each Interest Payment Date.

 

Advice:  As defined in Section 6(c) hereto.

 

Agreement:  As defined in the preamble hereto.

 

Broker-Dealer:  Any broker or dealer registered under the Exchange Act.

 

Business Day:  Any day other than a Saturday, Sunday or U.S. federal holiday or
a day on which banking institutions or trust companies located in New York, New
York are authorized or obligated to be closed.

 

Closing Date:  The date of this Agreement.

 

Company:  As defined in the preamble hereto.

 

Commission:  The United States Securities and Exchange Commission.

 

Consummate:  A registered Exchange Offer shall be deemed “Consummated” for
purposes of this Agreement upon the occurrence of (i) the filing and
effectiveness under the Securities Act of an Exchange Offer Registration
Statement relating to the Exchange Securities to be issued in such Exchange
Offer, (ii) the maintenance of such Registration Statement continuously
effective and the keeping of such Exchange Offer open for a period not less than
the minimum period required pursuant to Section 3(b) hereof, and (iii) the
delivery by the Company to the Registrar under the Indenture of Exchange
Securities in the same aggregate principal amount as the aggregate principal
amount of Transfer Restricted Securities that were tendered by Holders thereof
pursuant to such Exchange Offer.

 

Exchange Act:  The Securities Exchange Act of 1934, as amended.

 

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Exchange Date:  As defined in Section 3(a) hereto.

 

Exchange Offer:  The registration by the Company under the Securities Act of
Exchange Securities pursuant to a Registration Statement pursuant to which the
Company offers the Holders of all outstanding Transfer Restricted Securities the
opportunity to exchange all such outstanding Transfer Restricted Securities held
by such Holders for Exchange Securities in an aggregate principal amount equal
to the aggregate principal amount of the Transfer Restricted Securities tendered
in such exchange offer by such Holders.

 

Exchange Offer Registration Statement:  The Registration Statement relating to
an Exchange Offer, including the related Prospectus.

 

Exchange Securities:  Debt securities of the Company substantially identical to
the Securities issued under the Indenture (except that the transfer restrictions
shall be modified or eliminated, as appropriate), to be issued to Holders in
exchange for their Transfer Restricted Securities.

 

FINRA:  Financial Industry Regulatory Authority, Inc.

 

Holder:  As defined in Section 2(b) hereof.

 

Indenture:  As defined in the preamble hereto.

 

Initial Purchasers:  As defined in the preamble hereto.

 

Interest Payment Date:  As defined in the Indenture.

 

Majority Holders:  With respect to Securities or Exchange Securities registered
under or covered by a Registration Statement on any date, Holders of a majority
of the principal amount of such Securities or Exchange Securities.

 

Prospectus:  The prospectus included in a Registration Statement, as amended or
supplemented by any prospectus supplement and by all other amendments thereto,
including post-effective amendments, and all material incorporated by reference
into such Prospectus.

 

Purchase Agreement:  As defined in the preamble hereto.

 

Registrar:  The registrar under the Indenture.

 

Registration Default: As defined in Section 5 hereof.

 

Registration Statement:  Any registration statement of the Company relating to
(a) an offering of Exchange Securities pursuant to an Exchange Offer or (b) the
registration for resale of Transfer Restricted Securities pursuant to a Shelf
Registration Statement, that covers Securities or Exchange Securities, as
applicable, and which is filed pursuant to the provisions of this Agreement, in
each case, including the Prospectus included therein, all amendments and
supplements thereto (including post-effective amendments) and all exhibits and
material incorporated by reference therein.

 

Securities:  As defined in the preamble hereto.

 

Securities Act:  The Securities Act of 1933, as amended.

 

Shelf Filing Deadline:  As defined in Section 4(a) hereof.

 

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Shelf Registration Statement:  As defined in Section 4(a) hereof.

 

Transfer Restricted Securities:  The Securities; provided that Securities shall
cease to be Transfer Restricted Securities on the earliest to occur of (i) the
date on which a Registration Statement with respect to the Securities has become
effective under the Securities Act and such Securities have been exchanged or
disposed of pursuant to such Registration Statement or (ii) the date on which
the Securities cease to be outstanding.

 

Trust Indenture Act:  The Trust Indenture Act of 1939, as amended.

 

Trustee:  As defined in the preamble hereto.

 

Underwritten Registration or Underwritten Offering:  A registration in which
securities of the Company are sold to an underwriter for reoffering to the
public.

 

SECTION 2.                            Securities Subject to this Agreement.

 

(a)                                 Transfer Restricted Securities.  The
securities entitled to the benefits of this Agreement are any Transfer
Restricted Securities.

 

(b)                                 Holders of Transfer Restricted Securities.
 A Person is deemed to be a holder of Transfer Restricted Securities (each, a
“Holder”) whenever such Person (including any successors or assigns) owns any
Transfer Restricted Securities.

 

SECTION 3.                            Registered Exchange Offer.

 

(a)                                 Unless an Exchange Offer shall not be
permissible under applicable law or Commission policy (after the procedures set
forth in Section 6(a) hereof have been complied with), or there are no Transfer
Restricted Securities outstanding, the Company shall (i) use its commercially
reasonable efforts to file with the Commission a Registration Statement under
the Securities Act relating to the Exchange Securities and the related Exchange
Offer for the Transfer Restricted Securities, (ii) use commercially reasonable
efforts to cause such Exchange Offer Registration Statement to become effective,
(iii) in connection with the foregoing, file (A) all pre-effective amendments to
such Exchange Offer Registration Statement as may be necessary in order to cause
such Exchange Offer Registration Statement to become effective, (B) if
applicable, a post-effective amendment to such Exchange Offer Registration
Statement pursuant to Rule 430A under the Securities Act and cause all necessary
filings in connection with the registration and qualification of the Exchange
Securities registered pursuant to such Exchange Offer Registration Statement to
be made under the state securities or Blue Sky laws of such jurisdictions as are
necessary to permit Consummation of such Exchange Offer, and (iv) upon the
effectiveness of such Exchange Offer Registration Statement, commence the
Exchange Offer with respect to the Exchange Securities registered pursuant to
such Exchange Offer Registration Statement.  The Company shall use commercially
reasonable efforts to Consummate such Exchange Offer with respect to the
Exchange Securities registered pursuant to such Exchange Offer Registration
Statement not later than 360 days following the Closing Date (or if such 360th
day is not a Business Day, the next succeeding Business Day) (the “Exchange
Date”).  Such Exchange Offer, if required pursuant to this Section 3(a), shall
be on the appropriate form permitting registration of the Exchange Securities to
be offered in exchange for Transfer Restricted Securities and to permit resales
of such Exchange Securities held by Broker-Dealers as contemplated by Section
3(c) hereof.

 

(b)                                 If an Exchange Offer Registration Statement
is required to be filed and declared effective pursuant to Section 3(a) above,
the Company shall use commercially reasonable efforts to cause such

 

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Exchange Offer Registration Statement to be effective continuously and shall
keep such Exchange Offer open for a period of not less than the minimum period
(the “Minimum Period”) required under applicable federal and state securities
laws to Consummate such Exchange Offer; provided, however, that in no event
shall the Minimum Period be less than 20 Business Days after the date notice of
such Exchange Offer is mailed to the Holders of Transfer Restricted Securities;
provided, further, that, except as required pursuant to Section 3(d) hereof, the
Company shall not be required to cause the Exchange Offer Registration Statement
to be effective after the expiration of the Minimum Period if the Exchange Offer
has been Consummated.  The Company shall cause such Exchange Offer to comply
with all applicable federal and state securities laws.  No securities other than
Exchange Securities shall be included in such Exchange Offer Registration
Statement.

 

(c)                                  The Company shall indicate in a “Plan of
Distribution” section contained in the Prospectus forming a part of any Exchange
Offer Registration Statement that any Broker-Dealer who holds any Transfer
Restricted Securities that were acquired for its own account as a result of
market-making activities or other trading activities (other than any Transfer
Restricted Securities acquired directly from the Company) may exchange such
Transfer Restricted Securities pursuant to such Exchange Offer; however, such
Broker-Dealer may be deemed to be an “underwriter” within the meaning of the
Securities Act and must, therefore, deliver a prospectus meeting the
requirements of the Securities Act in connection with any resales of such
Exchange Securities received by such Broker-Dealer in such Exchange Offer, which
prospectus delivery requirement may be satisfied by the delivery by such
Broker-Dealer of the Prospectus contained in such Exchange Offer Registration
Statement.  Such “Plan of Distribution” section shall also contain all other
information with respect to such resales by Broker-Dealers that the Commission
may require in order to permit such resales pursuant thereto, but such “Plan of
Distribution” shall not name any such Broker-Dealer or disclose the amount of
Transfer Restricted Securities held by any such Broker-Dealer except to the
extent required by the Commission as a result of a change in policy after the
date of this Agreement.

 

(d)                                 The Company shall use its commercially
reasonable efforts to keep an Exchange Offer Registration Statement continuously
effective, supplemented and amended as required by the provisions of Section
6(c) hereof to the extent necessary to ensure that it is available for resales
of any such Exchange Securities received by such Broker-Dealers, and to ensure
that it conforms with the requirements of this Agreement, the Securities Act and
the policies, rules and regulations of the Commission as announced from time to
time, for a period ending on the earlier of (i) 90 days from the date on which
such Exchange Offer Registration Statement is declared effective and (ii) the
date on which a Broker-Dealer is no longer required to deliver a prospectus in
connection with such resales.

 

(e)                                  The Company shall provide sufficient copies
of the latest version of such Prospectus to Broker-Dealers promptly upon request
at any time during such 90-day (or shorter as provided in the foregoing
sentence) period in order to facilitate such resales.

 

(f)                                   Notwithstanding anything in this Section 3
to the contrary, the requirements to file the Exchange Offer Registration
Statement and the requirements to Consummate the Exchange Offer shall terminate
at such time as all the Securities are no longer Transfer Restricted Securities.

 

(g)                                  Notwithstanding anything in this Agreement
to the contrary, it is agreed that if an Exchange Offer has not been Consummated
in accordance with this Section 3, the only remedy to the Holders of Transfer
Restricted Securities will be Additional Interest as set forth in Section 5
hereof.

 

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SECTION 4.                            Shelf Registration.

 

(a)                                 Shelf Registration.  If any of the
Securities are Transfer Restricted Securities by the Exchange Date and either
(i) the Company has not filed an Exchange Offer Registration Statement with
respect to any Transfer Restricted Securities or Consummated an Exchange Offer
with respect to any Transfer Restricted Securities solely because such Exchange
Offer is not permitted by applicable law or Commission policy (after the
procedures set forth in Section 6(a) hereof have been complied with), (ii) for
any other reason an Exchange Offer with respect to any Transfer Restricted
Securities is not Consummated by the Exchange Date, or (iii) prior to the
Exchange Date, with respect to any Holder of Transfer Restricted Securities,
such Holder notifies the Company that (1) such Holder is prohibited by
applicable law or Commission policy from participating in such Exchange Offer,
(2) such Holder may not resell such Exchange Securities acquired by it in such
Exchange Offer to the public without delivering a prospectus and that the
Prospectus contained in such Exchange Offer Registration Statement is not
appropriate or available for such resales by such Holder, or (3) such Holder is
a Broker-Dealer and holds Transfer Restricted Securities acquired directly from
the Company or one of its affiliates, the Company shall:

 

(x)                                 cause to be filed a shelf registration
statement pursuant to Rule 415 under the Securities Act, which may be an
amendment to the Exchange Offer Registration Statement with respect to Transfer
Restricted Securities referenced above (in either event, a “Shelf Registration
Statement”), on or prior to the 90th day after the Exchange Date (such date, the
“Shelf Filing Deadline”), which Shelf Registration Statement shall provide for
resales of Transfer Restricted Securities the Holders of which shall have
provided the information required pursuant to Section 4(b) hereof; and

 

(y)                                 use its commercially reasonable efforts to
cause such Shelf Registration Statement to be declared effective by the
Commission.

 

The Company shall use commercially reasonable efforts to keep such Shelf
Registration Statement continuously effective, supplemented and amended as
required by the provisions of Sections 6(b) and (c) hereof to the extent
necessary to ensure that it is available for resales of Transfer Restricted
Securities registered pursuant to such Shelf Registration Statement by the
Holders of such Securities entitled to the benefit of this Section 4(a), and to
ensure that it conforms with the requirements of this Agreement, the Securities
Act and the policies, rules and regulations of the Commission as announced from
time to time, for a period of one year from the date on which such Shelf
Registration Statement is declared effective by the Commission or such shorter
period that will terminate when all the Transfer Restricted Securities covered
by such Shelf Registration Statement have been sold pursuant to such Shelf
Registration Statement or are no longer Transfer Restricted Securities; provided
that the Company may delay the initial filing or suspend the effectiveness of
any Shelf Registration Statement (and suspend the use of the Prospectus that is
part of such Shelf Registration Statement) for a period of up to 60 days in any
three-month period, not to exceed 90 days in any calendar year, if the Company
determines in good faith that the initial filing or continuing effectiveness of
such Shelf Registration Statement would require premature disclosure of
material, non-public information that could reasonably be expected to adversely
affect the Company or a financing, acquisition, merger or other material
transaction to which the Company is a party, or such action is otherwise
required by law.  For the avoidance of doubt, any such suspension by the Company
in accordance with the foregoing proviso shall not constitute a Registration
Default under Section 5 hereof.  Notwithstanding anything to the contrary, the
requirements to file a Shelf Registration Statement and to have a Shelf
Registration Statement become effective and remain effective shall terminate at
such time as all Securities are no longer Transfer Restricted Securities.

 

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Notwithstanding anything in this Agreement to the contrary, it is agreed that if
a Shelf Registration Statement is required to be filed and declared effective
pursuant to this Section 4 and is not so filed and declared effective after the
Shelf Filing Deadline in accordance with this Section 4, or if any Shelf
Registration Statement required by this Agreement has been declared effective
but ceases to be effective at any time at which it is required to be effective
under this Agreement, the only remedy to the Holders of Securities to be
registered under such Shelf Registration Statement after such Shelf Filing
Deadline will be Additional Interest as set forth in Section 5 hereof.

 

(b)                                 Provision by Holders of Certain Information
in Connection with a Shelf Registration Statement.  No Holder of Transfer
Restricted Securities may include any of such Transfer Restricted Securities in
any Shelf Registration Statement pursuant to this Agreement unless and until
such Holder furnishes to the Company in writing, within 20 Business Days after
receipt of a request therefor, such information as the Company may reasonably
request for use in connection with any Shelf Registration Statement or
Prospectus or preliminary Prospectus included therein.  Each Holder as to which
any Shelf Registration Statement is being effected agrees to furnish promptly to
the Company all information required from time to time in order to make the
information previously furnished to the Company by such Holder not misleading.

 

SECTION 5.                            Additional Interest.  If any of the
Securities are Transfer Restricted Securities by the Exchange Date and either
(i) an Exchange Offer has not been Consummated in accordance with Section 3;
(ii) any Shelf Registration Statement, if required pursuant to Section 4, has
not been filed and declared effective by the Commission in accordance with
Section 4 or (iii) any Registration Statement required by this Agreement has
been declared effective but ceases to be effective at any time at which it is
required to be effective under this Agreement (each such event referred to in
clauses (i) through (iii), a “Registration Default”), the Company hereby agrees
that the interest rate borne by the Transfer Restricted Securities shall be
increased by 0.25% per annum (the “Additional Interest”) from and including the
date on which such Registration Default has occurred to, but excluding, the date
that is the earlier of (i) the date on which all Registration Defaults relating
to the Transfer Restricted Securities have been cured and (ii) the date on which
the Transfer Restricted Securities have ceased to be Transfer Restricted
Securities.  All accrued Additional Interest shall be paid in cash on each
Additional Interest Payment Date.  At the earlier of (i) the cure of all
Registration Defaults relating to the Transfer Restricted Securities or (ii) the
Transfer Restricted Securities having ceased to be Transfer Restricted
Securities, the interest rate borne by the Transfer Restricted Securities will
be reduced to the original interest rate borne by the Transfer Restricted
Securities; provided, however, that, if after any such reduction in interest
rate, a different Registration Default occurs, the interest rate borne by the
Transfer Restricted Securities shall again be increased pursuant to the
foregoing provisions.

 

SECTION 6.                            Registration Procedures.

 

(a)                                 Exchange Offer Registration Statement.  In
connection with an Exchange Offer, if required pursuant to Section 3(a) hereof,
the Company shall comply with all of the provisions of Section 6(c) hereof,
shall use its commercially reasonable efforts to effect such exchange to permit
the sale of Exchange Securities being sold in accordance with the intended
method or methods of distribution thereof, and shall comply with all of the
following provisions:

 

(i)                                     If in the reasonable opinion of counsel
to the Company there is a question as to whether an Exchange Offer is permitted
by applicable law, the Company hereby agrees to seek a no-action letter or other
favorable decision from the Commission allowing the Company to Consummate an
Exchange Offer for such Transfer Restricted Securities.  The Company and hereby
agrees to pursue the issuance of such a decision to the Commission staff level
but shall not be required to take commercially unreasonable action to effect a
change of Commission policy.

 

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The Company hereby agrees, however, to (A) participate in telephonic conferences
with the Commission, (B) deliver to the Commission staff an analysis prepared by
counsel to the Company setting forth the legal bases, if any, upon which such
counsel has concluded that such an Exchange Offer should be permitted and (C)
diligently pursue a favorable resolution by the Commission staff of such
submission.

 

(ii)                                  As a condition to its participation in an
Exchange Offer pursuant to the terms of this Agreement, each Holder of Transfer
Restricted Securities shall furnish, upon the request of the Company, prior to
the Consummation thereof, a written representation to the Company (which may be
contained in the letter of transmittal contemplated by such Exchange Offer
Registration Statement) to the effect that (A) it is not an affiliate of the
Company, (B) it is not engaged in, and does not intend to engage in, and has no
arrangement or understanding with any Person to participate in, a distribution
of the Exchange Securities to be issued in such Exchange Offer and (C) it is
acquiring the Exchange Securities to be issued in such Exchange Offer in its
ordinary course of business.  Each Holder hereby acknowledges and agrees that
any Broker-Dealer and any such Holder using the Exchange Offer to participate in
a distribution of the securities to be acquired in the Exchange Offer (1) could
not under Commission policy as in effect on the date of this Agreement rely on
the position of the Commission enunciated in Morgan Stanley and Co., Inc.
(available June 5, 1991) and Exxon Capital Holdings Corporation (available May
13, 1988), as interpreted in the Commission’s letter to Shearman & Sterling
dated July 2, 1993, and similar no-action letters (which may include any
no-action letter obtained pursuant to clause (i) above), and (2) must comply
with the registration and prospectus delivery requirements of the Securities Act
in connection with a secondary resale transaction and that such a secondary
resale transaction should be covered by an effective registration statement
containing the selling security holder information required by Item 507 or 508,
as applicable, of Regulation S-K if the resales are of Exchange Securities
obtained by such Holder in exchange for Transfer Restricted Securities acquired
by such Holder directly from the Company.

 

(b)                                 Shelf Registration Statement.  If required
pursuant to Section 4, in connection with a Shelf Registration Statement, the
Company shall comply with all the provisions of Section 6(c) hereof and shall
use commercially reasonable efforts to effect such registration to permit the
sale of Transfer Restricted Securities sold in accordance with the intended
method or methods of distribution thereof, and pursuant thereto the Company will
prepare and file with the Commission a Shelf Registration Statement relating to
the registration on any appropriate form under the Securities Act within the
period specified in Section 4(a)(x) hereof, which form shall be available for
the sale of the Transfer Restricted Securities in accordance with the intended
method or methods of distribution thereof.

 

(c)                                  General Provisions.  Except as otherwise
provided below, in connection with any Registration Statement and any Prospectus
required by this Agreement to permit the exchange or resale of Transfer
Restricted Securities (including, without limitation, any Registration Statement
and the related Prospectus required to permit resales of any Exchange Securities
by Broker-Dealers), the Company shall:

 

(i)                                     use commercially reasonable efforts to
keep such Registration Statement continuously effective and include or
incorporate by reference therein all requisite financial statements for the
period specified in Section 3 or 4 hereof, as applicable; and upon the
occurrence of any event that would cause any such Registration Statement or the
Prospectus contained therein (A) to contain a material misstatement or omission
or (B) not to be effective and usable for exchange or resale of Transfer
Restricted Securities during the period required by this Agreement, the Company
shall promptly file an appropriate amendment to such Registration Statement, in
the case of clause (A), correcting any such misstatement or omission, and, in
the case of either clause (A) or (B), use commercially reasonable efforts to
cause such amendment to

 

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be declared effective and such Registration Statement and the related Prospectus
to become usable for their intended purpose(s) as soon as practicable
thereafter;

 

(ii)                                  prepare and file with the Commission such
amendments and post-effective amendments to the applicable Registration
Statement as may be necessary to keep such Registration Statement effective for
the applicable period set forth in Section 3 or 4 hereof, as applicable, or such
shorter period as will terminate when Transfer Restricted Securities covered by
or related to such Registration Statement have been exchanged or sold pursuant
to such Registration Statement or are no longer Transfer Restricted Securities;
cause the Prospectus to be supplemented by any required Prospectus supplement,
and as so supplemented to be filed pursuant to Rule 424 under the Securities
Act, and to comply fully with the applicable provisions of Rules 424 and 430A
under the Securities Act in a timely manner; and comply with the provisions of
the Securities Act with respect to the disposition of all securities covered by
such Registration Statement during the applicable period in accordance with the
intended method or methods of distribution by the sellers thereof set forth in
such Registration Statement or supplement to the Prospectus;

 

(iii)                               advise the underwriter(s), if any, and
selling Holders of securities covered by such Registration Statement promptly
and, if requested by such Persons, to confirm such advice in writing, (A) when
the Prospectus or any Prospectus supplement or post-effective amendment has been
filed, and, with respect to any Registration Statement or any post-effective
amendment thereto, when the same has become effective, (B) of any request by the
Commission or any state securities commission for amendments to such
Registration Statement or amendments or supplements to the Prospectus or for
additional information relating thereto, (C) of the issuance by the Commission
of any stop order suspending the effectiveness of such Registration Statement
under the Securities Act or of the suspension by any state securities commission
of the qualification of the applicable securities for offering or sale in any
jurisdiction, or the initiation of any proceeding for any of the preceding
purposes, (D) of the existence of any fact or the happening of any event that
makes any statement of a material fact made in such Registration Statement, the
related Prospectus, any amendment or supplement thereto, or any document
incorporated by reference therein untrue, or that requires the making of any
additions to or changes in the Registration Statement or the Prospectus in order
to make the statements therein not misleading.  If at any time the Commission
shall issue any stop order suspending the effectiveness of any Registration
Statement, or any state securities commission or other regulatory authority
shall issue an order suspending the qualification or exemption from
qualification of the applicable securities under state securities or blue sky
laws, the Company shall use its commercially reasonable efforts to obtain the
withdrawal or lifting of such order at the earliest possible time;

 

(iv)                              in connection with any Shelf Registration
Statement, furnish without charge to the Trustee, each selling Holder named in
such Shelf Registration Statement, and each of the underwriter(s), if any,
before filing with the Commission, copies of such Shelf Registration Statement
or any Prospectus included therein or any amendments or supplements to any such
Shelf Registration Statement or Prospectus (including all documents incorporated
by reference after the initial filing of such Shelf Registration Statement),
which documents will be subject to the review and comment of the Trustee, such
Holders and underwriter(s) in connection with such sale, if any, for a period of
at least five Business Days, and the Company will not file any such Shelf
Registration Statement or Prospectus or any amendment or supplement to any such
Shelf Registration Statement or Prospectus (including all such documents
incorporated by reference) to which the Trustee or the Majority Holders of
Transfer Restricted Securities registered under such Shelf Registration
Statement or the underwriter(s), if any, shall reasonably object in writing

 

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within five Business Days after the receipt thereof (such objection to be deemed
timely made upon confirmation of telecopy transmission within such period).  The
objection of the Trustee or the Majority Holders of Transfer Restricted
Securities registered under such Shelf Registration Statement or underwriter(s),
if any, shall be deemed to be reasonable if such Shelf Registration Statement,
amendment, Prospectus or supplement, as applicable, as proposed to be filed,
contains a material misstatement or omission;

 

(v)                                 in connection with any Shelf Registration
Statement, make available at reasonable times for inspection by the managing
underwriter(s), if any, participating in any disposition pursuant to such Shelf
Registration Statement and any attorney or accountant retained by the managing
underwriter(s) or the Majority Holders of Transfer Restricted Securities
registered under such Shelf Registration Statement, all financial and other
records, pertinent corporate documents and properties of each of the Company and
cause the Company’s officers, directors and employees to supply all information
reasonably requested by any such managing underwriter, attorney or accountant in
connection with such Shelf Registration Statement or any post-effective
amendment thereto subsequent to the filing thereof and prior to its
effectiveness and to participate in meetings with investors to the extent
requested by the managing underwriter(s), if any; provided, however, that each
such party shall be required to maintain in confidence and not to disclose to
any other Person any information or records reasonably designated by the Company
as being confidential, until such time as (A) such information becomes a matter
of public record (whether by virtue of its inclusion in such Shelf Registration
Statement or otherwise, except as a result of a breach by any such party of this
or any other obligation of confidentiality to the Company), (B) such party shall
be required to disclose such information pursuant to a subpoena or order of any
court or other governmental agency or body having jurisdiction over the matter
(subject to the requirements of such subpoena or order, and only after such
party shall have given the Company prompt prior written notice of such
requirement; provided such party is permitted to give such notice under the
terms of such subpoena or order), or (C) such information is required to be set
forth in such Shelf Registration Statement or the Prospectus included therein or
an amendment or supplement thereto in order that such Shelf Registration
Statement, Prospectus, amendment or supplement, as applicable, complies with
applicable requirements of the federal securities laws and the rules and
regulations of the Commission and does not contain an untrue statement of a
material fact or omit to state a material fact necessary in order to make the
statements therein, in light of the circumstances under which they were made,
not misleading.

 

(vi)                              in connection with any Shelf Registration
Statement, if requested by any Holders named in such Shelf Registration
Statement or the underwriter(s), if any, promptly incorporate in such Shelf
Registration Statement or Prospectus, pursuant to a supplement or post-effective
amendment if necessary, such information as such Holders and underwriter(s), if
any, may reasonably request to have included therein if such information is
required by the rules and regulations of the Commission, including, without
limitation, information relating to the “Plan of Distribution” of Transfer
Restricted Securities covered by such Shelf Registration Statement, information
with respect to the principal amount of Transfer Restricted Securities being
sold to such underwriter(s), the purchase price being paid therefor and any
other terms of the offering of Transfer Restricted Securities to be sold in such
offering; and make all required filings of such prospectus supplement or
post-effective amendment as soon as practicable after the Company is notified of
the matters to be incorporated in such prospectus supplement or post-effective
amendment;

 

(vii)                           in connection with any Shelf Registration
Statement, cause Transfer Restricted Securities covered by such Shelf
Registration Statement to be rated, if not then rated, with the

 

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appropriate rating agencies, if so requested by the Majority Holders of Transfer
Restricted Securities covered thereby or by the underwriter(s), if any;

 

(viii)                        furnish to the Trustee, each selling Holder and
each of the underwriter(s), if any, without charge, at least one copy of the
applicable Registration Statement, as first filed with the Commission, and of
each amendment thereto, including financial statements and schedules, all
documents incorporated by reference therein and all exhibits (including exhibits
incorporated therein by reference) unless such documents or exhibits are
available on the Commission’s Electronic Data Gathering Analysis and Retrieval
system or the Interactive Data Electronic Applications system;

 

(ix)                                in connection with any Shelf Registration
Statement, deliver to each selling Holder of Transfer Restricted Securities
covered by such Shelf Registration Statement and each of the underwriter(s), if
any, without charge, as many copies of the Prospectus (including each
preliminary Prospectus) and any amendment or supplement thereto as such Persons
reasonably may request; the Company hereby consents to the use of the Prospectus
and any amendment or supplement thereto by each such selling Holder and each of
the underwriter(s), if any, in connection with the offering and the sale
Transfer Restricted Securities covered by the Prospectus or any amendment or
supplement thereto;

 

(x)                                   in connection with any Shelf Registration
Statement, enter into such customary agreements (including an underwriting
agreement), and make such representations and warranties, and take all such
other actions in connection therewith in order to expedite or facilitate the
disposition of Transfer Restricted Securities pursuant to any Shelf Registration
Statement contemplated by this Agreement, all to such extent as may be
reasonably requested by the Trustee, any Holder of Transfer Restricted
Securities covered by a Shelf Registration Statement or underwriter, if any, in
connection with any sale or resale pursuant to any Shelf Registration Statement
contemplated by this Agreement; and whether or not an underwriting agreement is
entered into and whether or not the registration is an Underwritten
Registration, the Company shall:

 

(A)                              furnish to the Trustee, each selling Holder of
Transfer Restricted Securities covered by a Shelf Registration Statement and
each underwriter, if any, in such substance and scope as they may reasonably
request and as are customarily made by issuers to underwriters in primary
underwritten offerings, upon the effectiveness of the applicable Shelf
Registration Statement:

 

(1)                                  an opinion, dated the date of effectiveness
of such Shelf Registration Statement of counsel for the Company, covering such
matters as are customarily covered in opinions requested in an underwritten
offering and such other matters as such parties may reasonably request, and in
any event including a statement to the effect that such counsel has participated
in conferences with officers and other representatives of the Company,
representatives of the independent public accountants for the Company,
representatives of the underwriter(s), if any, and counsel to the
underwriter(s), if any, in connection with the preparation of such Shelf
Registration Statement and the related Prospectus and have considered the
matters required to be stated therein and the statements contained therein,
although such counsel has not independently verified the accuracy, completeness
or fairness of such statements; and that such counsel advises that, on the basis
of the foregoing, no facts came to such counsel’s attention that caused such
counsel to believe that the applicable Shelf

 

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Registration Statement, at the time such Shelf Registration Statement or any
post-effective amendment thereto became effective contained an untrue statement
of a material fact or omitted to state a material fact required to be stated
therein or necessary to make the statements therein not misleading, or that the
Prospectus contained in such Shelf Registration Statement as of its date
contained an untrue statement of a material fact or omitted to state a material
fact necessary in order to make the statements therein, in the light of the
circumstances under which they were made, not misleading.  Without limiting the
foregoing, such counsel may state further that such counsel assumes no
responsibility for, and has not independently verified, the accuracy,
completeness or fairness of the financial statements, notes and schedules and
other financial data included in any Shelf Registration Statement contemplated
by this Agreement or the related Prospectus; and

 

(2)                                  a customary comfort letter, dated the date
of effectiveness of any Shelf Registration Statement, from the Company’s
independent accountants, in the customary form and covering matters of the type
customarily requested to be covered in comfort letters by underwriters in
connection with primary underwritten offerings; and

 

(B)                                deliver such other documents and certificates
as may be reasonably requested by such parties to evidence compliance with
Section 6(c)(x)(A) hereof and with any customary conditions contained in the
underwriting agreement or other agreement entered into by the Company pursuant
to this Section 6(c)(x), if any;

 

(xi)                                in connection with any Shelf Registration
Statement, prior to any public offering of any Transfer Restricted Securities,
cooperate with the selling Holders of Transfer Restricted Securities, the
underwriter(s), if any, and their respective counsel in connection with the
registration and qualification of the Transfer Restricted Securities under the
state securities or blue sky laws of such jurisdictions as the selling Holders
or underwriter(s), if any, may reasonably request and do any and all other acts
or things necessary or advisable to enable the disposition in such jurisdictions
of Transfer Restricted Securities covered by such Shelf Registration Statement;
provided, however, that the Company shall not be required to register or qualify
as a foreign corporation where it is not then so qualified or to take any action
that would subject it to the service of process in suits or to taxation, other
than as to matters and transactions relating to such Shelf Registration
Statement, in any jurisdiction where it is not then so subject;

 

(xii)                             [Reserved]

 

(xiii)                          in connection with any Shelf Registration
Statement, cooperate with the selling Holders of the Transfer Restricted
Securities covered by such Shelf Registration Statement and the underwriter(s),
if any, to facilitate the timely preparation and delivery of “global notes”
representing Transfer Restricted Securities to be sold and not bearing any
restrictive legends; and enable such Transfer Restricted Securities to be in
such denominations and registered in such names as the Holders of the Transfer
Restricted Securities covered by such Shelf Registration Statement or the
underwriter(s), if any, may request at least two Business Days prior to any sale
of such Transfer Restricted Securities made by such Holders or underwriter(s);

 

(xiv)                         in connection with any Shelf Registration
Statement, use commercially reasonable efforts to cause Transfer Restricted
Securities covered by such Shelf Registration Statement to be registered with or
approved by such other governmental agencies or authorities as

 

11

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may be necessary to enable the seller or sellers thereof or the underwriter(s),
if any, to consummate the disposition of such Transfer Restricted Securities,
subject to the proviso contained in Section 6(c)(xi) hereof;

 

(xv)                            if any fact or event contemplated by Section
6(c)(iii)(D) hereof shall exist or have occurred, prepare a supplement or
post-effective amendment to any Registration Statement or related Prospectus or
any document incorporated therein by reference or file any other required
document so that, as thereafter delivered to the purchasers of Exchange
Securities or Transfer Restricted Securities covered by such Registration
Statement, the Prospectus will not contain an untrue statement of a material
fact or omit to state any material fact necessary in order to make the
statements therein, in the light of the circumstances under which they were
made, not misleading;

 

(xvi)                         provide a CUSIP number for all Exchange Securities
or Transfer Restricted Securities not bearing any restrictive legends not later
than the effective date of the Registration Statement covering such Exchange
Securities or such Transfer Restricted Securities and provide the Trustee under
the Indenture with printed certificates for such Exchange Securities or Transfer
Restricted Securities which are in a form eligible for deposit with The
Depository Trust Company and take all other action necessary to ensure that all
such Exchange Securities or such Transfer Restricted Securities are eligible for
deposit with The Depository Trust Company;

 

(xvii)                      cooperate and assist in any filings required to be
made with FINRA and in the performance of any due diligence investigation by any
underwriter (including any “qualified independent underwriter” that is required
to be retained in accordance with the rules and regulations of FINRA);

 

(xviii)                   otherwise use its commercially reasonable efforts to
comply with all applicable rules and regulations of the Commission, and make
generally available to its security holders, as soon as practicable, a
consolidated earnings statement meeting the requirements of Rule 158 under the
Securities Act (which need not be audited) for the twelve-month period (A)
commencing at the end of any fiscal quarter in which any Transfer Restricted
Securities are sold to underwriters in a firm commitment or best efforts
Underwritten Offering or (B) if not sold to underwriters in such an offering,
beginning with the first month of the Company’s first fiscal quarter commencing
after the effective date of a Registration Statement;

 

(xix)                           cause the Indenture to be qualified under the
Trust Indenture Act not later than the effective date of the first Registration
Statement required by this Agreement, and, in connection therewith, cooperate
with the Trustee and the Holders of Securities to effect such changes to the
Indenture as may be required for such Indenture to be so qualified in accordance
with the terms of the Trust Indenture Act; and to execute and use its
commercially reasonable efforts to cause the Trustee to execute all documents
that may be required to effect such changes and all other forms and documents
required to be filed with the Commission to enable such Indenture to be so
qualified in a timely manner; and

 

(xx)                              [Reserved].

 

Each Holder agrees by acquisition of Transfer Restricted Securities that, upon
receipt of any notice from the Company of the existence of any fact of the kind
described in Section 6(c)(iii)(D) hereof, such Holder will forthwith discontinue
disposition of Exchange Securities or Transfer Restricted Securities pursuant to
the applicable Registration Statement until such Holder’s receipt of the copies
of the supplemented or amended Prospectus contemplated by Section 6(c)(xv)
hereof, or until it is advised in

 

12

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writing (the “Advice”) by the Company that the use of the Prospectus may be
resumed, and has received copies of any additional or supplemental filings that
are incorporated by reference in the Prospectus.  If so directed by the Company,
each applicable Holder will deliver to the Company (at the Company’s expense)
all copies, other than permanent file copies then in such Holder’s possession,
of the Prospectus covering such Exchange Securities or Transfer Restricted
Securities that was current at the time of receipt of such notice.  In the event
the Company shall give any such notice, the time period regarding the
effectiveness of such Registration Statement set forth in Section 3 or 4 hereof,
as applicable, shall be extended by the number of days during the period from
and including the date of the giving of such notice pursuant to Section
6(c)(iii)(D) hereof to and including the date when each selling Holder covered
by such Registration Statement shall have received the copies of the
supplemented or amended Prospectus contemplated by Section 6(c)(xv) hereof or
shall have received the Advice; provided, however, that no such extension shall
be taken into account in determining whether Additional Interest is due pursuant
to Section 5 hereof or the amount of such Additional Interest with respect to
the Transfer Restricted Securities covered by or related to such Registration
Statement, it being agreed that the Company’s option to suspend use of a
Registration Statement pursuant to this paragraph shall be treated as a
Registration Default for purposes of Section 5 hereof in the case of an Exchange
Offer Registration Statement required pursuant to Section 3 hereof, if such
suspension exceeds an aggregate of 30 days in any three-month period or an
aggregate of 60 days in any six-month period, and in the case of a Shelf
Registration Statement required pursuant to Section 4, if such suspension
exceeds an aggregate of 60 days in any three month period or an aggregate of 90
days in any calendar year.

 

(d)                                 Underwritten Offerings.  Notwithstanding
anything to the contrary contained in this Agreement, the Company shall not be
obligated to undertake an Underwritten Offering pursuant to a Shelf Registration
Statement within six (6) months following any Underwritten Offering (whether or
not pursuant to a Shelf Registration Statement).

 

SECTION 7.                                Registration Expenses.

 

(a)                                  All expenses incident to the Company’s
performance of or compliance with this Agreement will be borne by the Company,
regardless of whether a Registration Statement becomes effective, including,
without limitation:  (i) all registration and filing fees and expenses
(including any filings made by any Holder with FINRA (and, if applicable, the
fees and expenses of any “qualified independent underwriter” and its counsel
that may be required by the rules and regulations of FINRA)) and all rating
agency fees; (ii) all fees and expenses of compliance with federal securities
and state securities or Blue Sky laws; (iii) all expenses of printing (including
printing certificates for the Exchange Securities to be issued in the Exchange
Offer and printing of Prospectuses), messenger and delivery services and
telephone; (iv) all fees and disbursements of counsel for the Company and the
Trustee; (v) all fees and disbursements of independent certified public
accountants of the Company (including the expenses of any special audit and
comfort letters required by or incident to such performance); and (vi) all fees
and disbursements relating to the qualification of the Indenture under the Trust
Indenture Act of 1939, as amended.

 

The Company will, in any event, bear its internal expenses (including, without
limitation, all salaries and expenses of its officers and employees performing
legal or accounting duties), the expenses of any annual audit and the fees and
expenses of any Person, including special experts, retained by the Company.

 

(b)                                 In connection with a Shelf Registration
Statement, the Company will reimburse the Holders of all Transfer Restricted
Securities being resold pursuant to the “Plan of Distribution” contained in such
Shelf Registration Statement for the reasonable fees and disbursements of not
more than one

 

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counsel as may be chosen by the vote of the Holders of the majority in aggregate
principal amount of all Transfer Restricted Securities for whose benefit such
Shelf Registration Statement is being prepared.

 

SECTION 8.                                Indemnification.

 

(a)                                  The Company agrees to indemnify and hold
harmless each Holder, its directors and officers, and each person, if any, who
controls any Holder within the meaning of the Securities Act and the Exchange
Act against any loss, claim, damage, liability or expense, as incurred, to which
such Holder, director, officer or controlling person may become subject, under
the Securities Act, the Exchange Act or other U.S. federal or state statutory
law or regulation, or at common law or otherwise (including in settlement of any
litigation, if such settlement is effected with the prior written consent of the
Company), insofar as such loss, claim, damage, liability or expense (or actions
in respect thereof as contemplated below) arises out of or is based upon (i) any
untrue statement or alleged untrue statement of a material fact contained in any
Registration Statement or caused by any omission or alleged omission to state
therein a material fact required to be stated therein or necessary in order to
make the statements therein, not misleading, or (ii) any untrue statement or
alleged untrue statement of a material fact contained in any Prospectus (or any
amendment or supplement thereto) or caused by any omission or alleged omission
to state therein a material fact necessary in order to make the statements
therein, in light of the circumstances under which they were made, not
misleading; and to reimburse each Holder and each such director, officer,
employee or controlling person for any and all expenses (including the fees and
disbursements of counsel) as such expenses are reasonably incurred by such
Holder or such director, officer or controlling person in connection with
investigating, defending, settling, compromising or paying any such loss, claim,
damage, liability, expense or action; provided, however, that the Company will
not be liable in any case to the extent such loss, claim, damage, liability or
expense arises out of or is based upon any untrue statement or alleged untrue
statement or omission or alleged omission made in reliance upon and in
conformity with written information furnished to the Company by such Holder
expressly for use in any Registration Statement or Prospectus (or any amendment
or supplement thereto).  The indemnity agreement set forth in this Section 8(a)
shall be in addition to any liabilities that the Company may otherwise have.

 

(b)                                 Each Holder agrees, severally and not
jointly, to indemnify and hold harmless the Company, its directors, each of its
officers who sign a Registration Statement and each person, if any, who controls
the Company within the meaning of the Securities Act or the Exchange Act,
against any loss, claim, damage, liability or expense, as incurred, to which the
Company or any such director, officer or controlling person may become subject,
under the Securities Act, the Exchange Act, or other U.S. federal or state
statutory law or regulation, or at common law or otherwise (including in
settlement of any litigation, if such settlement is effected with the written
consent of the Majority Holders), insofar as such loss, claim, damage, liability
or expense (or actions in respect thereof as contemplated below) arises out of
or is based upon (i) any untrue statement or alleged untrue statement of a
material fact contained in any Registration Statement or caused by any omission
or alleged omission to state therein a material fact required to be stated
therein or necessary in order to make the statements therein, not misleading, or
(ii) any untrue statement or alleged untrue statement of a material fact
contained in any Prospectus (or any amendment or supplement thereto), or caused
by any omission or alleged omission to state therein a material fact necessary
in order to make the statements therein, in light of the circumstances under
which they were made, not misleading, in each case to the extent, but only to
the extent, that such untrue statement or alleged untrue statement or omission
or alleged omission was made in any Registration Statement or Prospectus (or any
amendment or supplement thereto) in reliance upon and in conformity with written
information furnished to the Company by such Holder expressly for use therein;
and to reimburse the Company and each such director and officer or controlling
person for any and all expenses (including the fees and disbursements of
counsel) as such expenses are reasonably incurred by the Company or such
director, officer or controlling person in connection with investigating,
defending,

 

14

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settling, compromising or paying any such loss, claim, damage, liability,
expense or action.  The indemnity agreement set forth in this Section 8(b) shall
be in addition to any liabilities that each Holder may otherwise have.

 

(c)                                  Promptly after receipt by an indemnified
party under this Section 8 of notice of the commencement of any action, such
indemnified party will, if a claim in respect thereof is to be made against an
indemnifying party under this Section 8 notify the indemnifying party in writing
of the commencement thereof, but the omission so to notify the indemnifying
party will not relieve it from any liability which it may have to any
indemnified party for contribution or otherwise other than under the indemnity
agreement contained in this Section 8 or from any liability it may have under
this Section 8 to the extent it is not materially prejudiced as a proximate
result of such failure.  In case any such action is brought against any
indemnified party and such indemnified party seeks or intends to seek indemnity
from an indemnifying party, the indemnifying party will be entitled to
participate in and, to the extent that it shall elect, jointly with all other
indemnifying parties similarly notified, by written notice delivered to the
indemnified party promptly after receiving the aforesaid notice from such
indemnified party, to assume the defense thereof with counsel reasonably
satisfactory to such indemnified party; provided, however, if the defendants in
any such action include both the indemnified party and the indemnifying party
and the indemnified party shall have reasonably concluded that a conflict may
arise between the positions of the indemnifying party and the indemnified party
in conducting the defense of any such action or that there may be legal defenses
available to it and/or other indemnified parties which are different from or
additional to those available to the indemnifying party, the indemnified party
or parties shall have the right to select separate counsel to assume such legal
defenses and to otherwise participate in the defense of such action on behalf of
such indemnified party or parties.  Upon receipt of notice from the indemnifying
party to such indemnified party of such indemnifying party’s election so to
assume the defense of such action and reasonable approval by the indemnified
party of counsel, the indemnifying party will not be liable to such indemnified
party under this Section 8 for any legal or other expenses subsequently incurred
by such indemnified party in connection with the defense thereof unless (i) the
indemnified party shall have employed separate counsel in accordance with the
proviso to the next preceding sentence (it being understood, however, that the
indemnifying party shall not be liable for the expenses of more than one
separate counsel (together with local counsel), reasonably approved by the
indemnifying party, representing the indemnified parties who are parties to such
action) or (ii) the indemnifying party shall not have employed counsel
reasonably satisfactory to the indemnified party to represent the indemnified
party within a reasonable time after notice of commencement of the action, in
each of which cases the fees and expenses of counsel shall be at the expense of
the indemnifying party.

 

(d)                                 The indemnifying party under this Section 8
shall not be liable for any settlement of any proceeding effected without its
written consent, but if settled with such consent or if there be a final
judgment for the plaintiff, the indemnifying party agrees to indemnify the
indemnified party against any loss, claim, damage, liability or expense by
reason of such settlement or judgment.  No indemnifying party shall, without the
prior written consent of the indemnified party, effect any settlement,
compromise or consent to the entry of judgment in any pending or threatened
action, suit or proceeding in respect of which any indemnified party is or could
have been a party and indemnity was or could have been sought hereunder by such
indemnified party, unless such settlement, compromise or consent (i) includes an
unconditional release of such indemnified party from all liability on claims
that are the subject matter of such action, suit or proceeding and (ii) does not
include any statements as to or any findings of fault, culpability or failure to
act by or on behalf of any indemnified party.

 

(e)                                  If the indemnification provided for in
Section 8 hereof is for any reason held to be unavailable to or otherwise
insufficient to hold harmless an indemnified party in respect of any losses,
claims, damages, liabilities or expenses referred to therein, then each
indemnifying party shall contribute to the aggregate amount paid or payable by
such indemnified party, as incurred, as a result of any losses,

 

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claims, damages, liabilities or expenses referred to therein, (i) in such
proportion as is appropriate to reflect the relative benefits received by the
Company, on the one hand, and the Holders, on the other hand, or (ii) if the
allocation provided by clause (i) above is not permitted by applicable law, in
such proportion as is appropriate to reflect not only the relative benefits
referred to in clause (i) above but also the relative fault of the Company, on
the one hand, and the Holders, on the other hand, in connection with the
statements or omissions which resulted in such losses, claims, damages,
liabilities or expenses, as well as any other relevant equitable
considerations.  The relative benefits received by the Company, on the one hand,
and the Holders, on the other hand, shall be determined in a manner as is
appropriate to reflect the relative economic benefits of the Company, on the one
hand, and the Holders, on the other hand, in the matters contemplated by this
Agreement.  The relative fault of the Company, on the one hand, and the Holders,
on the other hand, shall be determined by reference to, among other things,
whether any such untrue or alleged untrue statement of a material fact or
omission or alleged omission to state a material fact relates to information
supplied by the Company, on the one hand, or the Holders, on the other hand, and
the parties’ relative intent, knowledge, access to information and opportunity
to correct or prevent such statement or omission.

 

(f)                                    The amount paid or payable by a party as
a result of the losses, claims, damages, liabilities and expenses referred to
above shall be deemed to include, subject to the limitations set forth in
Section 8 hereof, any legal or other fees or expenses reasonably incurred by
such party in connection with investigating or defending any action or claim. 
The provisions set forth in Section 8 hereof with respect to notice of
commencement of any action shall apply if a claim for contribution is to be made
under Section 8(e) above; provided, however, that no additional notice shall be
required with respect to any action for which notice has been given under
Section 8 hereof for purposes of indemnification.  The Company and each Holder
agree that it would not be just and equitable if contribution pursuant to
Section 8(e) were determined by pro rata allocation (even if the Holders were
treated as one entity for such purpose) or by any other method of allocation
which does not take account of the equitable considerations referred to in
Section 8(e).

 

(g)                                 Notwithstanding the provisions of Section
8(e), no Holder shall be required to contribute any amount in excess of the
dollar amount by which the total net profit received by such Holder from the
sale of any Securities exceeds the amount of any damages which such Holder has
otherwise been required to pay by reason of such untrue or alleged untrue
statement or omission or alleged omission.  No person guilty of fraudulent
misrepresentation (within the meaning of Section 11 of the Securities Act) shall
be entitled to contribution from any person who was not guilty of such
fraudulent misrepresentation.  The Holders’ obligations to contribute pursuant
to Section 8(e) above are several, and not joint, on a pro rata basis based on
such Holder’s aggregate principal amount of Transfer Restricted Securities
included in or related to such Registration Statement or Prospectus.  For
purposes of Section 8(e) above, each director, officer and employee of a Holder
and each person, if any, who controls a Holder within the meaning of the
Securities Act and the Exchange Act shall have the same rights to contribution
as such a Holder, and each director and officer of the Company, and each person,
if any, who controls the Company within the meaning of the Securities Act and
the Exchange Act shall have the same rights to contribution as the Company.

 

SECTION 9.                                Participation in Underwritten
Registrations.

 

No Holder may participate in any Underwritten Registration hereunder unless such
Holder (a) agrees to sell such Holder’s Transfer Restricted Securities on the
basis provided in any underwriting arrangements approved by the Persons entitled
hereunder to approve such arrangements and (b) completes and executes all
reasonable questionnaires, powers of attorney, indemnities, underwriting
agreements, lock-up letters and other documents required under the terms of such
underwriting arrangements.

 

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SECTION 10.                          Selection of Underwriters.

 

The Holders covered by a Shelf Registration Statement who desire to do so may
sell Transfer Restricted Securities covered by such Shelf Registration Statement
in an Underwritten Offering.  In any such Underwritten Offering, the investment
banker(s) and managing underwriter(s) that will administer such offering will be
selected by the vote of the Holders of the majority in aggregate principal
amount of Transfer Restricted Securities included in such offering; provided,
however, that such investment banker(s) and managing underwriter(s) must be
reasonably satisfactory to the Company.

 

SECTION 11.                          Miscellaneous.

 

(a)                                  Remedies.  Subject to Section 3(g) and the
last paragraph of Section 4(a) hereof, the Company hereby agrees that monetary
damages would not be adequate compensation for any loss incurred by reason of a
breach by it of the provisions of this Agreement and hereby agrees to waive the
defense in any action for specific performance that a remedy at law would be
inadequate.

 

(b)                                 No Inconsistent Agreements.  Each of the
Company will not on or after the date of this Agreement enter into any agreement
with respect to its securities that is inconsistent with the rights granted to
the Holders in this Agreement or otherwise conflicts with the provisions
hereof.  The rights granted to the Holders hereunder do not in any way conflict
with and are not inconsistent with the rights granted to the holders of the
Company’s securities under any agreement in effect on the date hereof.

 

(c)                                  Amendments and Waivers.  The provisions of
this Agreement may not be amended, modified or supplemented, and waivers or
consents to or departures from the provisions hereof may not be given unless the
Company has (i) in the case of Section 5 hereof and this Section 11(c)(i),
obtained the written consent of Holders of all outstanding Transfer Restricted
Securities and (ii) in the case of all other provisions hereof, obtained the
written consent of the Holders of a majority of the aggregate principal amount
of Transfer Restricted Securities outstanding (in either case, excluding any
Transfer Restricted Securities held by the Company or its affiliates).

 

(d)                                 Notices.  All notices and other
communications provided for or permitted hereunder shall be made in writing by
hand-delivery, first-class mail (registered or certified, return receipt
requested), telex, telecopier, facsimile, or air courier guaranteeing overnight
delivery:

 

(i)                                     if to a Holder, at the address set forth
on the records of the Registrar under the Indenture, with a copy to the
Registrar under the Indenture;

 

(ii)                                  and if to the Company:

 

iStar Financial Inc.
1114 Avenue of the Americas, 39th Floor
New York, NY 10036
Facsimile:  (212) 930-9400
Attention:  Chief Executive Officer

 

With a copy to:

 

17

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Clifford Chance US LLP
31 West 52nd Street
New York, NY 10019
Facsimile:  (212) 878-8375
Attention:  Kathleen L. Werner, Esq.

 

All such notices and communications shall be deemed to have been duly given:  at
the time delivered by hand, if personally delivered; five Business Days after
being deposited in the mail, postage prepaid, if mailed; when answered back, if
telexed; when receipt acknowledged, if telecopied; and on the next Business Day,
if timely delivered to an air courier guaranteeing overnight delivery.

 

Copies of all such notices, demands or other communications shall be
concurrently delivered by the Person giving the same to the Trustee at the
address specified in the Indenture.

 

(e)                                  Successors and Assigns.  This Agreement
shall inure to the benefit of and be binding upon the successors and assigns of
each of the parties, including, without limitation, and without the need for an
express assignment, subsequent Holders; provided, however, that this Agreement
shall not inure to the benefit of or be binding upon a successor or assign of a
Holder unless and to the extent such successor or assign acquired Transfer
Restricted Securities from such Holder.

 

(f)                                    Counterparts.  This Agreement may be
executed in any number of counterparts and by the parties hereto in separate
counterparts, each of which when so executed shall be deemed to be an original
and all of which taken together shall constitute one and the same agreement.

 

(g)                                 Headings.  The headings in this Agreement
are for convenience of reference only and shall not limit or otherwise affect
the meaning hereof.

 

(h)                                 Governing Law; Waiver of Jury Trial.  THIS
AGREEMENT SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAWS OF
THE STATE OF NEW YORK.  ANY RIGHT TO TRIAL BY JURY WITH RESPECT TO ANY CLAIM OR
PROCEEDING RELATED TO OR ARISING OUT OF THIS AGREEMENT OR ANY TRANSACTION OR
CONDUCT IN CONNECTION HEREWITH, IS WAIVED.

 

(i)                                     Severability.  In the event that any one
or more of the provisions contained herein, or the application thereof in any
circumstance, is held invalid, illegal or unenforceable, the validity, legality
and enforceability of any such provision in every other respect and of the
remaining provisions contained herein shall not be affected or impaired thereby.

 

(j)                                     Entire Agreement.  This Agreement is
intended by the parties as a final expression of their agreement and intended to
be a complete and exclusive statement of the agreement and understanding of the
parties hereto in respect of the subject matter contained herein.  There are no
restrictions, promises, warranties or undertakings, other than those set forth
or referred to herein with respect to the registration rights granted by the
Company with respect to the Transfer Restricted Securities.  This Agreement
supersedes all prior agreements and understandings between the parties with
respect to such subject matter.

 

(k)                                  Third-Party Beneficiaries.  Holders
(including Broker-Dealers holding Transfer Restricted Securities) are express
and intended third-party beneficiaries of this Agreement, and this Agreement may
be enforced by such Persons.

 

[Signature Pages follow]

 

18

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IN WITNESS WHEREOF, the parties have executed this Agreement as of the date
first written above.

 

 

iSTAR FINANCIAL INC.

 

 

 

 

 

By:

/s/ David M. DiStaso

 

 

Name:

David M. DiStaso

 

 

Title:

Chief Financial Officer

 

19

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MERRILL LYNCH, PIERCE, FENNER & SMITH INCORPORATED

 

 

 

 

 

 

 

 

 

By:

/s/ Dan Kelly

 

 

Name:

Dan Kelly

 

 

Title:

Managing Director

 

 

 

 

 

 

 

 

 

BARCLAYS CAPITAL INC.

 

 

 

 

 

 

 

 

 

By:

/s/ Jean-Francois Astier

 

 

Name:

Jean-Francois Astier

 

 

Title:

Managing Director

 

 

 

 

 

 

 

 

 

J.P. MORGAN SECURITIES LLC

 

 

 

 

 

 

 

 

 

By:

/s/ Marco Prono

 

 

Name:

Marco Prono

 

 

Title:

Vice-President

 

20

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