RESTRICTED STOCK UNIT AWARD AGREEMENT

THIS RESTRICTED STOCK UNIT AWARD AGREEMENT (the “Agreement”) is effective as of
             , 2007 (the “Award Date”) and entered into by and between iStar
Financial Inc. (the “Company”) and the Participant identified on the Notice of
Grant of Award attached hereto (the “Notice”), sets forth the general terms and
conditions of an award of restricted stock units (“Units”) relating to shares of
Common Stock of the Company (“Shares”) made to the Participant, pursuant to the
iStar Financial Inc. 2006 Long-Term Incentive Plan, as amended and restated (the
“Plan”). Except as otherwise defined herein, capitalized terms used in this
Agreement have the respective meanings set forth in the Plan.

1.     Award.  The number of Units, representing the right to receive an
equivalent number of Shares, is set forth in the attached Notice.

2.     Vesting.

(a)   The Units shall vest in increments in the amounts, and on the dates, set
forth in the attached Notice, if the Participant’s employment with an iStar
Entity (as defined below) has not terminated before each such vesting date;
provided, however, all of the Units shall become immediately vested in the event
the Participant terminates employment with an iStar Entity by reason of death or
Disability or if an iStar Entity terminates Participant’s employment without
Cause (as defined below) and a new employment relationship is not established
between Participant and another iStar Entity within 30 days of such termination.

(b)   Upon the vesting of Units, Participant shall be entitled to receive Shares
equal to the number of vested Units. The Company shall withhold Shares in an
amount necessary to satisfy any applicable income taxes and other withholding
obligations due in connection with the vesting of the Units. Promptly following
each vesting date, the net amount of Shares shall be issued and delivered to
Participant, free of any restrictive legend, in certificated form or otherwise
as Participant may direct.

(c)   In the event that Participant voluntarily terminates employment with an
iStar Entity or an iStar Entity terminates Participant’s employment for Cause
(as defined below), any unvested portion of the Units shall be forfeited
automatically as of the date of termination of employment.

(d)   “iStar Entity” shall mean the Company and any entity controlled by,
controlling or under common control with the Company.

(e)   “Cause” shall mean:

(i)         Any actions or omissions representing fraudulent or willful
misconduct against the Company, any of its affiliates or any iStar Entity;
provided, however, that no act or failure to act shall be considered “willful”
unless it is done, or omitted to be done, without reasonable belief that such

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action or omission was in the best interest of the Company or the iStar Entity
that then employs Participant;

(ii)        conviction of a felony (unless such felony solely involves traffic
violations or unless such felony reversed, overturned or vacated on appeal);

(iii)       any grossly negligent action or omission or action or omission
representing reckless disregard of any of Participant’s duties and obligations
as an employee or otherwise to the Company, its affiliates or any iStar Entity
if such action or omission results in materially adverse consequences for the
Company, its affiliates or any iStar Entity;

(iv)       a knowing action or knowing omission to take any action which would
place the Company or any iStar Entity that employs Participant in material
default in the performance of any of its contractual or legal duties or
obligations to other persons or entities; provided, however, that no act or
failure to act shall be considered “knowing” unless it is done, or omitted to be
done, without reasonable belief that such action or omission was in the best
interest of the Company or any iStar Entity that employs Participant;

(v)        the failure, left uncured after not less than thirty (30) days prior
written notice from the Company or any iStar Entity that employs Participant
specifying in reasonable detail the breach(es) complained of, to substantially
perform his or her duties to the Company or any iStar Entity that employs
Participant (excluding, however, any failure to meet any performance targets),
except where such failure results from incapacity due to physical or mental
illness; or

(vi)       any dereliction of duty or negligent misconduct in respect of
Participant’s duties and obligations as an employee or otherwise to the Company,
its affiliates or any iStar Entity which results in a breach by the Company or
any iStar Entity that employs Participant of any contractual agreement binding
upon the Company or any iStar Entity that employs Participant and which breach
causes material adverse consequences for the Company, its affiliates or any
iStar Entity.

3.     Restrictions on Units.

(a)   The “Restricted Period” with respect to each installment of Units is the
period commencing on the Award Date and ending on the vesting date for such
installment.

(b)   During the Restricted Period, Units that are not vested (and the Shares
represented by such Units) are not transferable except as designated by the
Participant by will or by the laws of descent and distribution or, subject to
such procedures as the Administrator may establish, to or for the benefit of the
Participant’s family. Except as

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permitted by the foregoing, Units that are not vested (and the Shares
represented by such Units) may not be sold, assigned, transferred, pledged,
hypothecated, encumbered or otherwise disposed of (whether by operation of law
and otherwise) or be subject to execution, attachment or similar process. Any
attempt to so sell, transfer, assign, pledge, hypothecate, voluntarily encumber
or otherwise dispose of Units or Shares shall be null and void.  Upon the
vesting of Units, the Shares that are delivered to Participant shall be fully
transferable by Participant.

(c)   During the Restricted Period, Units that are not vested (and the Shares
represented by such Units) shall not be evidenced by a certificate registered in
the name of the Participant.

(d)   During the Restricted Period, the Participant shall not be entitled to
vote with respect to Shares represented by Units that are not vested.  Upon the
vesting of Units, the Participant shall have full rights as a shareholder with
respect to the Shares to be delivered to Participant upon vesting, including the
right to vote such Shares.

4.     Dividend Equivalent Rights.  From and after the Award Date and ending on
the vesting date of each installment of Units, the Participant shall be entitled
to receive payments with respect to each Unit equal to the dividends paid by the
Company on one Share. Such payments shall be made to the Participant in cash,
net of applicable tax withholdings, on the same date as dividend payments are
made to Company shareholders. The right to receive such payments with respect to
a Unit shall terminate upon the vesting of such Unit, at which time the
Participant shall be entitled to receive Shares equal to the number of vested
Units, net of applicable tax withholdings, and shall thereafter receive
dividends on such Shares in the same manner as other Company shareholders.

5.     Adjustments to Number of Units and Shares.  In the event of any change in
the Company’s outstanding Shares by reason of any stock dividend, split,
spinoff, recapitalization or other similar change, the terms and the number of
any outstanding Units (and the Shares represented by such Units) shall be
equitably adjusted by the Administrator in its discretion to the extent the
Administrator determines that such adjustment is necessary to preserve the
benefit of this Agreement for the Participant and the Company.

5.     Agreement Not Contract of Employment.  This Agreement does not constitute
a contract of employment, and does not give the Participant the right to be
retained in the employ of the Company.

6.     Successors and Assigns.  This Agreement shall be binding upon, and inure
to the benefit of, the Company and its successors and assigns, and upon any
person acquiring, whether by merger, consolidation, purchase of assets or
otherwise, all or substantially all of the Company’s assets and business.

7.     Administration.  The authority to administer and interpret this Agreement
shall be vested in the Administrator, and the Administrator shall have all the
powers with respect to this Agreement as it has with respect to the Plan.  Any
interpretation of the

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Agreement by the Administrator and any decision made by it with respect to the
Agreement are final and binding on all persons.

8.     Representations.  The Shares represented by the Units are currently
registered under the Securities Act of 1933, as amended (the “Securities Act”),
and any applicable state securities laws, pursuant to an effective registration
statement.  The Participant hereby represents and covenants that any subsequent
sale of any such Shares shall be made either pursuant to an effective
registration statement under the Securities Act and any applicable state
securities laws, or pursuant to an exemption from registration under the
Securities Act and such state securities laws.

9.     Plan Governs.  The terms of this Agreement shall be subject to the terms
of the Plan, a copy of which may be obtained by the Participant from the office
of the Secretary of the Company.

10.   Amendment and Termination.  The Board of Directors of the Company may at
any time amend or terminate the Plan, provided that no such amendment or
termination may materially adversely affect the rights of the Participant
awarded hereunder.

11.   Waiver of Responsibility.  Participant understands that the Company has
assumed no responsibility for advising Participant as to the tax consequences to
Participant of the grant of Units under this Agreement.  Participant should
consult with his or her individual tax advisor concerning the applicability of
Federal, state and local tax laws to the Restricted Shares and to his or her
personal tax circumstances.

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