Exhibit 4.2


 




 


 





REGISTRATION RIGHTS AGREEMENT


 


Dated as of March 30, 2004


 


Among


 


iSTAR FINANCIAL INC.


 


and


 


J.P. MORGAN SECURITIES INC.

GOLDMAN, SACHS & CO.

BEAR, STEARNS & CO. INC.

CITIGROUP GLOBAL MARKETS INC.

DEUTSCHE BANK SECURITIES INC.

LEHMAN BROTHERS INC.

MERRILL LYNCH, PIERCE, FENNER & SMITH

INCORPORATED

WACHOVIA CAPITAL MARKETS, LLC


 


 


5.125% Senior Notes due 2011


 




 





 

















 


TABLE OF CONTENTS


 


	
   

  	
   

  	
   

  
	
  1.

  	
  Definitions

  	
   

  
	
   

  	
   

  	
   

  
	
  2.

  	
  Exchange Offer

  	
   

  
	
   

  	
   

  	
   

  
	
  3.

  	
  Shelf Registration

  	
   

  
	
   

  	
   

  	
   

  
	
  4.

  	
  Additional Interest

  	
   

  
	
   

  	
   

  	
   

  
	
  5.

  	
  Registration Procedures

  	
   

  
	
   

  	
   

  	
   

  
	
  6.

  	
  Registration Expenses

  	
   

  
	
   

  	
   

  	
   

  
	
  7.

  	
  Indemnification and Contribution

  	
   

  
	
   

  	
   

  	
   

  
	
  8.

  	
  Rules 144 and 144A

  	
   

  
	
   

  	
   

  	
   

  
	
  9.

  	
  Underwritten Registrations

  	
   

  
	
   

  	
   

  	
   

  
	
  10.

  	
  Miscellaneous

  	
   

  



 


i

















 


REGISTRATION RIGHTS AGREEMENT


 


This Registration Rights Agreement (this “Agreement”) is dated
as of March 30, 2004, among iSTAR FINANCIAL INC., a Maryland corporation
(the “Company”) and J.P. MORGAN SECURITIES INC., GOLDMAN, SACHS &
CO., BEAR, STEARNS & CO. INC., CITIGROUP GLOBAL MARKETS INC., DEUTSCHE BANK
SECURITIES INC., LEHMAN BROTHERS INC., MERRILL LYNCH, PIERCE, FENNER &
SMITH INCORPORATED and WACHOVIA CAPITAL MARKETS, LLC as initial purchasers (the
“Initial Purchasers”).


 


This Agreement is entered into in connection with the Purchase
Agreement by and among the Company and the Initial Purchasers, dated
March 25, 2004 (the “Purchase Agreement”), which provides for,
among other things, the sale by the Company to the Initial Purchasers of
$250,000,000 aggregate principal amount of the Company’s 5.125% Senior Notes
due 2011 (the “Notes”).  In order
to induce the Initial Purchasers to enter into the Purchase Agreement, the
Company has agreed to provide the registration rights set forth in this
Agreement for the benefit of the Initial Purchasers and any subsequent holder
or holders of the Notes.  The execution
and delivery of this Agreement is a condition to the Initial Purchasers’ obligation
to purchase the Notes under the Purchase Agreement.


 


The parties hereby agree as follows:


 


1.                                       Definitions


 


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


 


Additional Interest:  See Section 4(a) hereof.


 


Advice: 
See the last paragraph of Section 5 hereof.


 


Agreement: 
See the introductory paragraphs hereto.


 


Applicable Period:  See Section 2(b) hereof.


 


Business Day: 
Any day that is not a Saturday, Sunday or a day on which banking
institutions in New York are authorized or required by law to be closed.


 


Company: 
See the introductory paragraphs hereto.


 


Effectiveness Date:  With respect to (i) the Exchange Offer Registration
Statement, the 180th day after the Issue Date and (ii) any Shelf
Registration Statement, the 105th day after the Filing Date with respect
thereto; provided, however, that if the Effectiveness


 

















 


Date would otherwise fall on a day that is not a Business Day, then the
Effectiveness Date shall be the next succeeding Business Day.


 


Effectiveness Period:  See Section 3(a) hereof.


 


Event Date: 
See Section 4(b) hereof.


 


Exchange Act: 
The Securities Exchange Act of 1934, as amended, and the rules and
regulations of the SEC promulgated thereunder.


 


Exchange Notes:  See Section 2(a) hereof.


 


Exchange Offer:  See Section 2(a) hereof.


 


Exchange Offer Registration Statement:  See Section 2(a) hereof.


 


Filing Date: 
(A) If no Registration Statement has been filed by the Company
pursuant to this Agreement, the 75th day after the Issue Date; and (B) in
any other case (which may be applicable notwithstanding the consummation of the
Exchange Offer), the 45th day after the delivery of a Shelf Notice as required
pursuant to Section 2(c) hereof; provided, however, that if
the Filing Date would otherwise fall on a day that is not a Business Day, then
the Filing Date shall be the next succeeding Business Day.


 


Holder: 
Any holder of a Registrable Note or Registrable Notes.


 


Indenture: 
The Indenture, dated as of March 30, 2004, between the Company, and
U.S. Bank Trust National Association, as Trustee, pursuant to which the Notes
are being issued, as amended or supplemented from time to time in accordance
with the terms thereof.


 


Information: 
See Section 5(o) hereof.


 


Initial Purchasers:  See the introductory paragraphs hereto.


 


Initial Shelf Registration:  See Section 3(a) hereof.


 


Inspectors: 
See Section 5(o) hereof.


 


Issue Date: 
March 30, 2004, the date of original issuance of the Notes.


 


NASD: 
See Section 5(s) hereof.


 


Notes: 
See the introductory paragraphs hereto.


 


Participant: 
See Section 7(a) hereof.


 


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Participating Broker-Dealer:  See Section 2(b) hereof.


 


Person: 
An individual, trustee, corporation, partnership, limited liability
company, joint stock company, trust, unincorporated association, union,
business association, firm or other legal entity.


 


Private Exchange:  See Section 2(b) hereof.


 


Private Exchange Notes:  See Section 2(b) hereof.


 


Prospectus: 
The prospectus included in any Registration Statement (including,
without limitation, any prospectus subject to completion and a prospectus that
includes any information previously omitted from a prospectus filed as part of
an effective registration statement in reliance upon Rule 430A under the
Securities Act and any term sheet filed pursuant to Rule 434 under the
Securities Act), as amended or supplemented by any prospectus supplement, and
all other amendments and supplements to the Prospectus, including
post-effective amendments, and all material incorporated by reference or deemed
to be incorporated by reference in such Prospectus.


 


Purchase Agreement:  See the introductory paragraphs hereof.


 


Records: 
See Section 5(o) hereof.


 


Registrable Notes:  Each Note upon its original issuance and at all times subsequent
thereto, each Exchange Note as to which Section 2(c)(iv) hereof is
applicable upon original issuance and at all times subsequent thereto and each
Private Exchange Note upon original issuance thereof and at all times
subsequent thereto, until, in each case, the earliest to occur of (i) a
Registration Statement (other than, with respect to any Exchange Note as to
which Section 2(c)(iv) hereof is applicable, the Exchange Offer
Registration Statement) covering such Note, Exchange Note or Private Exchange
Note has been declared effective by the SEC and such Note, Exchange Note or
such Private Exchange Note, as the case may be, has been disposed of in
accordance with such effective Registration Statement, (ii) such Note has
been exchanged pursuant to the Exchange Offer for an Exchange Note or Exchange
Notes that may be resold without restriction under state and federal securities
laws, (iii) such Note, Exchange Note or Private Exchange Note, as the case
may be, ceases to be outstanding for purposes of the Indenture or
(iv) such Note, Exchange Note or Private Exchange Note, as the case may
be, may be resold without restriction pursuant to Rule 144(k) (as amended
or replaced) under the Securities Act.


 


Registration Statement:  Any registration statement of the Company
that covers any of the Notes, the Exchange Notes or the Private Exchange Notes
filed with the SEC under the Securities Act, including the Prospectus,
amendments and supplements to such registration


 


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statement, including post-effective amendments, all exhibits, and all
material incorporated by reference or deemed to be incorporated by reference in
such registration statement.


 


Rule 144: 
Rule 144 under the Securities Act.


 


Rule 144A: 
Rule 144A under the Securities Act.


 


Rule 405:  Rule 405 under the Securities Act.


 


Rule 415: 
Rule 415 under the Securities Act.


 


Rule 424: 
Rule 424 under the Securities Act.


 


SEC: 
The U.S. Securities and Exchange Commission.


 


Securities Act:  The Securities Act of 1933, as amended, and the rules and regulations
of the SEC promulgated thereunder.


 


Shelf Notice: 
See Section 2(c) hereof.


 


Shelf Registration:  See Section 3(b) hereof.


 


Shelf Registration Statement:  Any Registration Statement relating to a
Shelf Registration.


 


Shelf Suspension Period:  See Section 3(a) hereof.


 


Subsequent Shelf Registration:  See Section 3(b) hereof.


 


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


 


Trustee: 
The trustee under the Indenture and the trustee (if any) under any
indenture governing the Exchange Notes and Private Exchange Notes.


 


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


 


Except as otherwise specifically provided, all references in this Agreement
to acts, laws, statutes, rules, regulations, releases, forms, no-action letters
and other regulatory requirements (collectively, “Regulatory Requirements”)
shall be deemed to refer also to any amendments thereto and all subsequent
Regulatory Requirements adopted as a replacement thereto having substantially
the same effect therewith; provided that Rule 144 shall not be
deemed to amend or replace Rule 144A.


 


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2.                                       Exchange Offer


 


(a)                                  Unless
the Exchange Offer would violate applicable law or any applicable
interpretation of the staff of the SEC, the Company shall file with the SEC, no
later than the Filing Date, a Registration Statement (the “Exchange Offer
Registration Statement”) on an appropriate registration form with respect
to a registered offer (the “Exchange Offer”) to exchange any and all of
the Registrable Notes for a like aggregate principal amount of debt securities
of the Company (the “Exchange Notes”) that are identical in all material
respects to the Notes, except that (i) the Exchange Notes shall contain no
restrictive legend thereon and (ii) interest thereon shall accrue from the
last date on which interest was paid on the Notes or, if no such interest has
been paid, from the Issue Date, and which are entitled to the benefits of the
Indenture or a trust indenture which is identical in all material respects to
the Indenture (other than such changes to the Indenture or any such identical
trust indenture as are necessary to comply with the TIA) and which, in either
case, has been qualified under the TIA. 
The Exchange Offer shall comply with all applicable tender offer rules
and regulations under the Exchange Act and other applicable laws.  The Company shall (x) use its
reasonable best efforts to cause the Exchange Offer Registration Statement to
be declared effective under the Securities Act on or before the Effectiveness
Date; (y) keep the Exchange Offer open for at least 30 days (or longer if
required by applicable law) after the date that notice of the Exchange Offer is
mailed to Holders; and (z) consummate the Exchange Offer on or prior to
the 210th day following the Issue Date.


 


Each Holder (including, without limitation, each Participating
Broker-Dealer) who participates in the Exchange Offer will be required to
represent to the Company in writing (which may be contained in the applicable
letter of transmittal) that: 
(i) any Exchange Notes acquired in exchange for Registrable Notes
tendered are being acquired in the ordinary course of business of the Person
receiving such Exchange Notes, whether or not such recipient is such Holder
itself; (ii) at the time of the commencement or consummation of the
Exchange Offer, neither such Holder nor, to the actual knowledge of such
Holder, any other Person receiving Exchange Notes from such Holder has an
arrangement or understanding with any Person to participate in, the
distribution of the Exchange Notes in violation of the provisions of the
Securities Act; (iii) neither such Holder nor, to the actual knowledge of
such Holder, any other Person receiving Exchange Notes from such Holder is an
“affiliate” (as defined in Rule 405) of the Company or, if it is an
affiliate of the Company, it will comply with the registration and prospectus
delivery requirements of the Securities Act to the extent applicable and will
provide information to be included in the Shelf Registration Statement in accordance
with Section 5 hereof in order to have its Notes included in the Shelf
Registration Statement and benefit from the provisions regarding Additional
Interest in Section 4 hereof; (iv) neither such Holder nor, to the
actual knowledge of such Holder, any other Person receiving Exchange Notes from
such Holder is engaging in or intends to engage in a distribution of the Exchange
Notes; and (v) if such Holder is a Participating Broker-Dealer, such
Holder has acquired Registrable Notes as a result of market-making activities
or other trading activities


 


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and that it will comply with the applicable provisions of the
Securities Act (including, but not limited to, the prospectus delivery
requirements thereunder).


 


Upon consummation of the Exchange Offer in accordance with this
Section 2, the provisions of this Agreement shall continue to apply, mutatis
mutandis, solely with respect to Registrable Notes that are Private
Exchange Notes, Exchange Notes as to which Section 2(c)(iv) is applicable
and Exchange Notes held by Participating Broker-Dealers, and the Company shall
have no further obligation to register Registrable Notes (other than Private
Exchange Notes, Exchange Notes as to which clause 2(c)(iv) hereof applies
and Exchange Notes held by Participating Broker-Dealers) pursuant to
Section 3 hereof.


 


No securities other than the Exchange Notes  (and other senior unsecured
notes issued by the Company, the holders of which are entitled to registration
rights similar to those outlined in this Agreement) shall be included in the
Exchange Offer Registration Statement.


 


(b)                                 The
Company shall include within the Prospectus contained in the Exchange Offer
Registration Statement a section entitled “Plan of Distribution,”
reasonably acceptable to the Initial Purchasers, which shall contain a summary
statement of the positions taken or policies made by the staff of the SEC with
respect to the potential “underwriter” status of any broker-dealer that is the
“beneficial owner” (as defined in Rule 13d-3 under the Exchange Act) of
Exchange Notes received by such broker-dealer in the Exchange Offer (a “Participating
Broker-Dealer”), whether such positions or policies have been publicly
disseminated by the staff of the SEC or such positions or policies represent
the prevailing views of the staff of the SEC. 
Such “Plan of Distribution” section shall also expressly permit, to
the extent permitted by applicable policies and regulations of the SEC, the use
of the Prospectus by all Persons subject to the prospectus delivery
requirements of the Securities Act, including, to the extent permitted by
applicable policies and regulations of the SEC, all Participating
Broker-Dealers, and include a statement describing the means by which
Participating Broker-Dealers may resell the Exchange Notes in compliance with
the Securities Act.


 


The Company shall use its reasonable best efforts to keep the Exchange
Offer Registration Statement effective and to amend and supplement the
Prospectus contained therein in order to permit such Prospectus to be lawfully
delivered by all Persons subject to the prospectus delivery requirements of the
Securities Act for such period of time as is necessary to comply with
applicable law in connection with any resale of the Exchange Notes; provided,
however, that such period shall not be required to exceed 180 days or
such longer period if extended pursuant to the last paragraph of Section 5
hereof (the “Applicable Period”).


 


If, prior to consummation of the Exchange Offer, the Initial Purchasers
hold any Notes acquired by them that have the status of an unsold allotment in
the initial distribution, the Company, upon the request of the Initial
Purchasers, shall simultaneously with the delivery of the Exchange Notes issue
and deliver to the Initial Purchasers, in exchange (the “Private Exchange”)
for such Notes held by any such Holder, a like principal amount of notes


 


6

















 


(the “Private Exchange Notes”) of the Company that are identical
in all material respects to the Exchange Notes except for the placement of a
restrictive legend on such Private Exchange Notes.  The Private Exchange Notes shall be issued pursuant to the same
indenture as the Exchange Notes and bear the same CUSIP number as the Exchange
Notes if permitted by the CUSIP Service Bureau.


 


In connection with the Exchange Offer, the Company shall:


 


(1)                                  mail,
or cause to be mailed, to each Holder of record entitled to participate in the
Exchange Offer a copy of the Prospectus forming part of the Exchange Offer
Registration Statement, together with an appropriate letter of transmittal and
related documents;


 


(2)                                  use
its reasonable best efforts to keep the Exchange Offer open for not less than
30 days after the date that notice of the Exchange Offer is mailed to Holders
(or longer if required by applicable law);


 


(3)                                  utilize
the services of a depositary for the Exchange Offer with an address in the
Borough of Manhattan, The City of New York;


 


(4)                                  permit
Holders to withdraw tendered Notes at any time prior to the close of business,
New York time, on the last Business Day on which the Exchange Offer remains
open; and


 


(5)                                  otherwise
comply in all material respects with all applicable laws, rules and
regulations.


 


As soon as practicable after the close of the Exchange Offer and the
Private Exchange, if any, the Company shall:


 


(1)                                  accept
for exchange all Registrable Notes validly tendered and not validly withdrawn
pursuant to the Exchange Offer and the Private Exchange, if any;


 


(2)                                  deliver
to the Trustee for cancellation all Registrable Notes so accepted for exchange;
and


 


(3)                                  cause
the Trustee to authenticate and deliver promptly to each Holder of Notes,
Exchange Notes or Private Exchange Notes, as the case may be, equal in
principal amount to the Notes of such Holder so accepted for exchange; provided
that, in the case of any Notes held in global form by a depositary,
authentication and delivery to such depositary of one or more replacement Notes
in global form in an equivalent principal amount thereto for the account of
such Holders in accordance with the Indenture shall satisfy such authentication
and delivery requirement.


 


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The Exchange Offer and the Private Exchange shall not be subject to any
conditions, other than that (i) the Exchange Offer or Private Exchange, as
the case may be, does not violate applicable law or any applicable
interpretation of the staff of the SEC; (ii) no action or proceeding shall
have been instituted or threatened in any court or by any governmental agency
which might materially impair the ability of the Company to proceed with the Exchange
Offer or the Private Exchange, and no material adverse development shall have
occurred in any existing action or proceeding with respect to the Company; and
(iii) all governmental approvals shall have been obtained, which approvals
the Company deem necessary for the consummation of the Exchange Offer or
Private Exchange.


 


The Exchange Notes and the Private Exchange Notes shall be issued under
(i) the Indenture or (ii) an indenture identical in all material
respects to the Indenture and which, in either case, has been qualified under
the TIA or is exempt from such qualification and shall provide that the
Exchange Notes shall not be subject to the transfer restrictions set forth in
the Indenture.  The Indenture or such
indenture shall provide that the Exchange Notes, the Private Exchange Notes and
the Notes shall vote and consent together on all matters as one class and that
none of the Exchange Notes, the Private Exchange Notes or the Notes will have
the right to vote or consent as a separate class on any matter.


 


(c)                                  If,
(i) because of any change in law or in currently prevailing
interpretations of the staff of the SEC, the Company is not permitted to effect
the Exchange Offer, (ii) the Exchange Offer is not consummated within 210
days of the Issue Date, (iii) the Initial Purchasers or any other holder
of Private Exchange Notes so requests in writing to the Company at any time
after the consummation of the Exchange Offer, or (iv) in the case of any
Holder that participates in the Exchange Offer, such Holder does not receive
Exchange Notes on the date of the exchange that may be sold without restriction
under state and federal securities laws (other than due solely to the status of
such Holder as an affiliate of the Company within the meaning of the Securities
Act) and so notifies the Company within 60 days after the consummation of the
Exchange Offer, then in the case of each of clauses (i) to and including (iv)
of this sentence, the Company shall promptly deliver to the Holders and the
Trustee written notice thereof (the “Shelf Notice”) and shall file a
Shelf Registration pursuant to Section 3 hereof.


 


3.                                       Shelf Registration


 


If at any time a Shelf Notice is delivered as contemplated by
Section 2(c) hereof, then:


 


(a)                                  Shelf Registration.  The Company shall file with the SEC a
Registration Statement for an offering to be made on a continuous basis
pursuant to Rule 415 covering all of the Registrable Notes (the “Initial
Shelf Registration”).  The Company
shall file with the SEC the Initial Shelf Registration as promptly as
practicable and, in any event, on or prior to the applicable Filing Date.  The Initial Shelf Registration


 


8

















 


shall be on Form S-3 or another
appropriate form permitting registration of such Registrable Notes for resale
by Holders in the manner or manners designated by them (including, without
limitation, one or more underwritten offerings).  The Company shall not permit any securities other than the
Registrable Notes to be included in the Initial Shelf Registration or any
Subsequent Shelf Registration (as defined below).


 


The Company shall use its reasonable best efforts to cause the Shelf
Registration to be declared effective under the Securities Act on or prior to
the Effectiveness Date and to keep the Initial Shelf Registration continuously
effective under the Securities Act until the date that is two years from the
Issue Date or such shorter period ending when all Registrable Notes covered by
the Initial Shelf Registration have been sold in the manner set forth and as
contemplated in the Initial Shelf Registration or, if applicable, a Subsequent
Shelf Registration (the “Effectiveness Period”); provided, however,
that the Effectiveness Period in respect of the Initial Shelf Registration
shall be extended to the extent required to permit dealers to comply with the
applicable prospectus delivery requirements of Rule 174 under the Securities
Act and as otherwise provided herein and shall be subject to reduction to the
extent that the applicable provisions of Rule 144(k) are amended or revised to
reduce the two year holding period set forth therein.  Notwithstanding anything to the contrary in this Agreement, at
any time, the Company may delay the filing of any Shelf Registration Statement
or delay or suspend the effectiveness thereof or cease to permit the use of any
related Prospectus (including any amendment or supplement), for a reasonable
period of time, but not in excess of an aggregate of 60 days in any
calendar year (a “Shelf Suspension Period”), if the Board of Directors
of the Company determines in good faith that the filing of any such Shelf
Registration Statement or the continuing effectiveness thereof or the continued
use of any such Prospectus (or amendment or supplement) would require the
disclosure of non-public material information that would be detrimental to the
Company if so disclosed or would otherwise materially adversely affect a
financing, acquisition, disposition, merger or other material transaction.


 


(b)                                 Withdrawal
of Stop Orders; Subsequent Shelf Registrations.  If the Initial Shelf Registration or any Subsequent Shelf
Registration ceases to be effective for any reason at any time during the
Effectiveness Period (other than because of the sale of all of the Notes registered
thereunder), the Company shall use its reasonable best efforts to obtain the
prompt withdrawal of any order suspending the effectiveness thereof, and in any
event shall within 45 days of such cessation of effectiveness amend such Shelf
Registration Statement in a manner to obtain the withdrawal of the order
suspending the effectiveness thereof or file an additional Shelf Registration
Statement pursuant to Rule 415 covering all of the Registrable Notes covered by
and not sold under the Initial Shelf Registration or an earlier Subsequent
Shelf Registration (each, a “Subsequent Shelf Registration”).  If a Subsequent Shelf Registration is filed,
the Company shall use its reasonable best efforts to cause the Subsequent Shelf
Registration to be declared effective under the Securities Act as soon as
practicable after such


 


9

















 


filing and to
keep such subsequent Shelf Registration continuously effective for a period
equal to the number of days in the Effectiveness Period less the aggregate
number of days during which the Initial Shelf Registration or any Subsequent
Shelf Registration was previously continuously effective.  As used herein the term “Shelf
Registration” means the Initial Shelf Registration and any Subsequent Shelf
Registration.


 


(c)                                  Supplements
and Amendments.  The Company shall
promptly supplement and amend the Shelf Registration if required by the rules,
regulations or instructions applicable to the registration form used for such
Shelf Registration, if required by the Securities Act, or if reasonably
requested by the Holders of a majority in aggregate principal amount at
maturity of the Registrable Notes (or their counsel) covered by such
Registration Statement with respect to the information included therein with
respect to one or more of such Holders, or by any underwriter of such
Registrable Notes with respect to the information included therein with respect
to such underwriter.


 


4.                                       Additional Interest


 


(a)                                  The
Company and the Initial Purchasers agree that the Holders will suffer damages
if the Company fails to fulfill its obligations under Section 2 or
Section 3 hereof and that it would not be feasible to ascertain the extent
of such damages with precision.  Accordingly,
the Company agrees to pay, as liquidated damages, additional interest on the
Notes (“Additional Interest”) under the circumstances and to the extent
set forth below (each of which shall be given independent effect):


 


(i)                                     if
(A) neither the Exchange Offer Registration Statement nor the Initial Shelf
Registration has been filed on or prior to the Filing Date applicable thereto
or (B) notwithstanding that the Company has consummated or will consummate the
Exchange Offer, the Company is required to file a Shelf Registration and such
Shelf Registration is not filed on or prior to the Filing Date applicable
thereto, then, commencing on the day after any such Filing Date, Additional
Interest shall accrue on the principal amount of the Notes at a rate of 0.25%
per annum for the first 90 days immediately following such applicable Filing
Date, and such Additional Interest rate shall increase by an additional 0.25%
per annum at the beginning of each subsequent 90-day period; or


 


(ii)                                  if
(A) neither the Exchange Offer Registration Statement nor the Initial Shelf
Registration is declared effective by the SEC on or prior to the Effectiveness
Date applicable thereto or (B) notwithstanding that the Company has
consummated or will consummate the Exchange Offer, the Company is required to
file a Shelf Registration and such Shelf Registration is not declared effective
by the SEC on or prior to the Effectiveness Date applicable to such Shelf
Registration, then, commencing on the day after such Effectiveness Date,
Additional Interest shall accrue on the principal amount of the Notes at a rate
of 0.25% per annum for the first 90 days immediately


 


10

















 


following the day after such Effectiveness Date, and such Additional
Interest rate shall increase by an additional 0.25% per annum at the beginning
of each subsequent 90-day period; or


 


(iii)                               if
(A) the Company has not exchanged Exchange Notes for all Notes validly
tendered in accordance with the terms of the Exchange Offer on or prior to the
210th day after the Issue Date or (B) if applicable, a Shelf Registration
has been declared effective and such Shelf Registration ceases to be effective
at any time during the Effectiveness Period, then Additional Interest shall
accrue on the principal amount of the Notes which are required to be registered
under the applicable Exchange Offer Registration Statement or Shelf
Registration Statement at a rate of 0.25% per annum for the first 90 days
commencing on the (x) 210th day after the Issue Date, in the case of (A) above,
or (y) the day such Shelf Registration ceases to be effective in the case of
(B) above, and such Additional Interest rate shall increase by an additional
0.25% per annum at the beginning of each such subsequent 90-day period;


 


provided, however, that the Additional
Interest rate on the Notes may not accrue under more than one of the foregoing
clauses (i) - (iii) at any one time and at no time shall the aggregate amount
of additional interest accruing exceed in the aggregate 1.0% per annum; provided,
further, however, that (1) upon the filing of the applicable
Exchange Offer Registration Statement or the applicable Shelf Registration as
required hereunder (in the case of clause (i) above of this Section 4),
(2) upon the effectiveness of the Exchange Offer Registration Statement or
the applicable Shelf Registration Statement as required hereunder (in the case
of clause (ii) of this Section 4) or (3) upon the exchange of the
Exchange Notes for all Notes tendered (in the case of clause (iii)(A) of this
Section 4), or upon the effectiveness of the applicable Shelf Registration
Statement which had ceased to remain effective (in the case of (iii)(B) of this
Section 4), Additional Interest on the Notes in respect of which such
events relate as a result of such clause (or the relevant subclause thereof),
as the case may be, shall cease to accrue. 
Notwithstanding any other provision of this Section 4, the Company
shall not be obligated to pay Additional Interest provided in Sections
4(a)(i)(B), 4(a)(ii)(B) or 4(a)(iii)(B) during a Shelf Suspension Period
permitted by Section 3(a) hereof.


 


(b)                                 The
Company shall notify the Trustee within one business day after each and every
date on which an event occurs in respect of which Additional Interest is
required to be paid (an “Event Date”). 
Any amounts of Additional Interest due pursuant to (a)(i), (a)(ii) or
(a)(iii) of this Section 4 will be payable in cash, in each case,
semiannually on each April 1 and October 1 (to the holders of record
on the March 15 and September 15 immediately preceding such dates),
commencing with the first such date occurring after any such Additional
Interest commences to accrue.  The
amount of Additional Interest will be determined by multiplying the applicable
Additional Interest rate by the principal amount of the Registrable Notes,
multiplied by a fraction, the numerator of which is the number of days such
Additional Interest rate was applicable during such period (determined on the
basis of a


 


11

















 


360 day
year comprised of twelve 30 day months and, in the case of a partial
month, the actual number of days elapsed), and the denominator of which is 360.


 


5.                                       Registration Procedures


 


In connection with the filing of any Registration Statement pursuant to
Section 2 or 3 hereof, the Company shall effect such registrations to
permit the sale of the securities covered thereby in accordance with the
intended method or methods of disposition thereof, and pursuant thereto and in
connection with any Registration Statement filed thereunder, the Company shall:


 


(a)                                  Prepare and file with
the SEC prior to the applicable Filing Date a Registration Statement or
Registration Statements as prescribed by Section 2 or 3 hereof, and use
its reasonable best efforts to cause each such Registration Statement to become
effective and remain effective as provided herein; provided, however,
that if (1) such filing is pursuant to Section 3 hereof or (2) a
Prospectus contained in the Exchange Offer Registration Statement filed pursuant
to Section 2 hereof is required to be delivered under the Securities Act
by any Participating Broker-Dealer who seeks to sell Exchange Notes during the
Applicable Period relating thereto from whom the Company has received prior
written notice that it will be a Participating Broker-Dealer in the Exchange
Offer, before filing any Registration Statement or Prospectus or any amendments
or supplements thereto the Company shall furnish to and afford the Holders of
the Registrable Notes covered by such Registration Statement (with respect to a
Registration Statement filed pursuant to Section 3 hereof) or each such
Participating Broker-Dealer (with respect to any such Registration Statement),
as the case may be, their counsel and the managing underwriters, if any, a
reasonable opportunity to review copies of all such documents (including copies
of any documents to be incorporated by reference therein and all exhibits
thereto) proposed to be filed (in each case at least five business days prior
to such filing).  The Company shall not
file any Registration Statement or Prospectus or any amendments or supplements
thereto if the Holders of a majority in aggregate principal amount of the
Registrable Notes covered by such Registration Statement, their counsel, or the
managing underwriters, if any, shall reasonably object on a timely basis.


 


(b)                                 Prepare and file with
the SEC such amendments and post-effective amendments to each Shelf
Registration Statement or Exchange Offer Registration Statement, as the case
may be, as may be necessary to keep such Registration Statement continuously
effective for the Effectiveness Period, the Applicable Period or until
consummation of the Exchange Offer, as the case may be; cause the related
Prospectus to be supplemented by any Prospectus supplement required by
applicable law, and as so supplemented to be filed pursuant to Rule 424;
and comply with the provisions of the Securities Act and the Exchange Act
applicable to it with respect to the


 


12

















 


disposition of all securities
covered by such Registration Statement as so amended or in such Prospectus as
so supplemented and with respect to the subsequent resale of any securities
being sold by an Participating Broker-Dealer covered by any such Prospectus.


 


(c)                                  If (1) a Shelf
Registration is filed pursuant to Section 3 hereof, or (2) a
Prospectus contained in the Exchange Offer Registration Statement filed
pursuant to Section 2 hereof is required to be delivered under the
Securities Act by any Participating Broker-Dealer who seeks to sell Exchange
Notes during the Applicable Period relating thereto from whom the Company has
received written notice that it will be a Participating Broker-Dealer in the
Exchange Offer, notify the selling Holders of Registrable Notes (with respect
to a Registration Statement filed pursuant to Section 3 hereof), or each
such Participating Broker-Dealer (with respect to any such Registration
Statement), as the case may be, their counsel and the managing underwriters, if
any, promptly (but in any event within one business day), and confirm such
notice in writing, (i) when a Prospectus or any Prospectus supplement or
post-effective amendment has been filed, and, with respect to a Registration
Statement or any post-effective amendment, when the same has become effective
under the Securities Act (including in such notice a written statement that any
Holder may, upon request, obtain, at the sole expense of the Company, one
conformed copy of such Registration Statement or post-effective amendment
including financial statements and schedules, documents incorporated or deemed
to be incorporated by reference and exhibits), (ii) of the issuance by the
SEC of any stop order suspending the effectiveness of a Registration Statement
or of any order preventing or suspending the use of any preliminary prospectus
or the initiation of any proceedings for that purpose, (iii) if at any
time when a prospectus is required by the Securities Act to be delivered in
connection with sales of the Registrable Notes or resales of Exchange Notes by
Participating Broker-Dealers the representations and warranties of the Company
contained in any agreement (including any underwriting agreement) contemplated
by Section 5(n) hereof cease to be true and correct, (iv) of the
receipt by the Company of any notification with respect to the suspension of
the qualification or exemption from qualification of a Registration Statement
or any of the Registrable Notes or the Exchange Notes to be sold by any
Participating Broker-Dealer for offer or sale in any jurisdiction, or the
initiation or threatening of any proceeding for such purpose, (v) of the
happening of any event, the existence of any condition or any information
becoming known that makes any statement made in such Registration Statement or
related Prospectus or any document incorporated or deemed to be incorporated
therein by reference untrue in any material respect or that requires the making
of any changes in or amendments or supplements to such Registration Statement,
Prospectus or documents so that, in the case of the Registration Statement, it
will not


 


13

















 


contain any untrue statement of
a material fact or omit to state any material fact required to be stated therein
or necessary to make the statements therein not misleading, and that in the
case of the Prospectus, it will not contain any untrue statement of a material
fact or omit to state any material fact required to be stated therein or
necessary to make the statements therein, in the light of the circumstances
under which they were made, not misleading, and (vi) of the Company’s
determination that a post-effective amendment to a Registration Statement would
be appropriate.


 


(d)                                 Use its reasonable
best efforts to prevent the issuance of any order suspending the effectiveness
of a Registration Statement or of any order preventing or suspending the use of
a Prospectus or suspending the qualification (or exemption from qualification)
of any of the Registrable Notes or the Exchange Notes to be sold by any
Participating Broker-Dealer, for sale in any jurisdiction, and, if any such
order is issued, to use its reasonable best efforts to obtain the withdrawal of
any such order at the earliest practicable moment.


 


(e)                                  If a Shelf
Registration is filed pursuant to Section 3 and if requested during the
Effectiveness Period by the managing underwriter or underwriters (if any), the
Holders of a majority in aggregate principal amount of the Registrable Notes
being sold in connection with an underwritten offering or any Participating
Broker-Dealer, (i) as promptly as practicable incorporate in a prospectus
supplement or post-effective amendment such information as the managing
underwriter or underwriters (if any), such Holders, any Participating
Broker-Dealer or counsel for any of them reasonably request to be included
therein, (ii) make all required filings of such prospectus supplement or
such post-effective amendment as soon as practicable after the Company has
received notification of the matters to be incorporated in such prospectus
supplement or post-effective amendment, and (iii) supplement or make amendments
to such Registration Statement.


 


(f)                                    If (1) a Shelf
Registration is filed pursuant to Section 3 hereof, or (2) a Prospectus
contained in the Exchange Offer Registration Statement filed pursuant to
Section 2 hereof is required to be delivered under the Securities Act by
any Participating Broker-Dealer who seeks to sell Exchange Notes during the
Applicable Period, furnish to each selling Holder of Registrable Notes (with
respect to a Registration Statement filed pursuant to Section 3 hereof)
and to each such Participating Broker-Dealer who so requests (with respect to
any such Registration Statement) and to their respective counsel and each
managing underwriter, if any, at the sole expense of the Company, one conformed
copy of the Registration Statement or Registration Statements and each
post-effective amendment thereto, including financial statements and schedules,
and, if requested, all documents incorporated or deemed to be incorporated
therein by reference and all exhibits.


 


(g)                                 If (1) a Shelf
Registration is filed pursuant to Section 3 hereof, or (2) a
Prospectus contained in the Exchange Offer Registration Statement filed
pursuant to


 


14

















 


Section 2 hereof is
required to be delivered under the Securities Act by any Participating
Broker-Dealer who seeks to sell Exchange Notes during the Applicable Period,
deliver to each selling Holder of Registrable Notes (with respect to a
Registration Statement filed pursuant to Section 3 hereof), or each such
Participating Broker-Dealer (with respect to any such Registration Statement),
as the case may be, their respective counsel, and the underwriters, if any, at
the sole expense of the Company, as many copies of the Prospectus or
Prospectuses (including each form of preliminary prospectus) and each amendment
or supplement thereto and any documents incorporated by reference therein as
such Persons may reasonably request; and, subject to the last paragraph of this
Section 5, the Company hereby consents to the use of such Prospectus and
each amendment or supplement thereto by each of the selling Holders of
Registrable Notes or each such Participating Broker-Dealer, as the case may be,
and the underwriters or agents, if any, and dealers, if any, in connection with
the offering and sale of the Registrable Notes covered by, or the sale by
Participating Broker-Dealers of the Exchange Notes pursuant to, such Prospectus
and any amendment or supplement thereto.


 


(h)                                 Prior to any public
offering of Registrable Notes or any delivery of a Prospectus contained in the
Exchange Offer Registration Statement by any Participating Broker-Dealer who
seeks to sell Exchange Notes during the Applicable Period, use its reasonable
best efforts to register or qualify, and to cooperate with the selling Holders
of Registrable Notes or each such Participating Broker-Dealer, as the case may
be, the managing underwriter or underwriters, if any, and their respective
counsel in connection with the registration or qualification (or exemption from
such registration or qualification) of such Registrable Notes for offer and
sale under the securities or Blue Sky laws of such jurisdictions within the
United States as any selling Holder, Participating Broker-Dealer, or the
managing underwriter or underwriters reasonably request in writing; provided,
however, that where Exchange Notes held by Participating Broker-Dealers
or Registrable Notes are offered other than through an underwritten offering,
the Company agrees to cause its counsel to perform Blue Sky investigations and
file registrations and qualifications required to be filed pursuant to this
Section 5(h), keep each such registration or qualification (or exemption
therefrom) effective during the period such Registration Statement is required
to be kept effective and do any and all other acts or things necessary or
advisable to enable the disposition in such jurisdictions of the Exchange Notes
held by Participating Broker-Dealers or the Registrable Notes covered by the
applicable Registration Statement; provided, however, that the
Company shall not be required to (A) qualify generally to do business in
any jurisdiction where it is not then so qualified, (B) take any action
that would subject it to general service of process in any such jurisdiction
where it is not then so subject or (C) subject itself to taxation in
excess of a nominal dollar amount in any such jurisdiction where it is not then
so subject.


 


15

















 


(i)                                     If a Shelf
Registration is filed pursuant to Section 3 hereof, cooperate with the
selling Holders of Registrable Notes and the managing underwriter or
underwriters, if any, to facilitate the timely preparation and  delivery of certificates representing
Registrable Notes to be sold, which certificates shall not bear any restrictive
legends and shall be in a form eligible for deposit with The Depository Trust
Company; and enable such Registrable Notes to be in such denominations (subject
to applicable requirements contained in the Indenture) and registered in such
names as the managing underwriter or underwriters, if any, or Holders may request.


 


(j)                                     [reserved].


 


(k)                                  If (1) a Shelf
Registration is filed pursuant to Section 3 hereof, or (2) a
Prospectus contained in the Exchange Offer Registration Statement filed
pursuant to Section 2 hereof is required to be delivered under the
Securities Act by any Participating Broker-Dealer who seeks to sell Exchange
Notes during the Applicable Period, upon the occurrence of any event
contemplated by paragraph 5(c)(v) or 5(c)(vi) hereof, as promptly as
practicable prepare and (subject to Section 5(a) hereof) file with the
SEC, at the sole expense of the Company, a supplement or post-effective
amendment to the Registration Statement or a supplement to the related
Prospectus or any document incorporated or deemed to be incorporated therein by
reference, or file any other required document so that, as thereafter delivered
to the purchasers of the Registrable Notes being sold thereunder (with respect
to a Registration Statement filed pursuant to Section 3 hereof) or to the
purchasers of the Exchange Notes to whom such Prospectus will be delivered by a
Participating Broker-Dealer (with respect to any such Registration Statement),
any such Prospectus will not contain an untrue statement of a material fact or
omit to state a material fact required to be stated therein or necessary to
make the statements therein, in the light of the circumstances under which they
were made, not misleading.


 


(l)                                     Use its reasonable
best efforts to cause the Registrable Notes covered by a Registration Statement
or the Exchange Notes, as the case may be, to be rated with the appropriate
rating agencies, if so requested by the Holders of a majority in aggregate
principal amount of Registrable Notes covered by such Registration Statement or
the Exchange Notes, as the case may be, or the managing underwriter or underwriters,
if any.


 


(m)                               Prior to the effective
date of the first Registration Statement relating to the Registrable Notes,
(i) provide the Trustee with certificates for the Registrable Notes in a
form eligible for deposit with The Depository Trust Company and (ii) provide
a CUSIP number for the Registrable Notes.


 


(n)                                 In connection with any
underwritten offering of Registrable Notes pursuant to a Shelf Registration,
enter into an underwriting agreement as is customary in


 


16

















 


underwritten offerings of debt
securities similar to the Notes, and take all such other actions as are
reasonably requested by the managing underwriter or underwriters in order to
expedite or facilitate the registration or the disposition of such Registrable
Notes and, in such connection, (i) make such representations and
warranties to, and covenants with, the underwriters with respect to the
business of the Company (including any acquired business, properties or entity,
if applicable), and the Registration Statement, Prospectus and documents, if
any, incorporated or deemed to be incorporated by reference therein, in each
case, as are customarily made by Company to underwriters in underwritten
offerings of debt securities similar to the Notes, and confirm the same in
writing if and when requested; (ii) obtain the written opinion of counsel
to the Company, and written updates thereof in form, scope and substance
reasonably satisfactory to the managing underwriter or underwriters, addressed
to the underwriters covering the matters customarily covered in opinions
reasonably requested in underwritten offerings; (iii) obtain “cold
comfort” letters and updates thereof in form, scope and substance reasonably
satisfactory to the managing underwriter or underwriters from the independent
certified public accountants of the Company (and, if necessary, any other
independent certified public accountants of the Company, or of any business
acquired by the Company, for which financial statements and financial data are,
or are required to be, included or incorporated by reference in the
Registration Statement), addressed to each of the underwriters, such letters to
be in customary form and covering matters of the type customarily covered in
“cold comfort” letters in connection with underwritten offerings of debt
securities similar to the Notes; and (iv) if an underwriting agreement is
entered into, the same shall contain indemnification provisions and procedures
no less favorable to the sellers and underwriters, if any, than those set forth
in Section 7 hereof (or such other provisions and procedures reasonably
acceptable to Holders of a majority in aggregate principal amount of
Registrable Notes covered by such Registration Statement and the managing
underwriter or underwriters or agents, if any).  The above shall be done at each closing under such underwriting
agreement, or as and to the extent required thereunder.


 


(o)                                 If (1) a Shelf
Registration is filed pursuant to Section 3 hereof, or (2) a
Prospectus contained in the Exchange Offer Registration Statement filed
pursuant to Section 2 hereof is required to be delivered under the
Securities Act by any Participating Broker-Dealer who seeks to sell Exchange
Notes during the Applicable Period, make available for inspection by any Initial
Purchaser, any selling Holder of such Registrable Notes being sold (with
respect to a Registration Statement filed pursuant to Section 3 hereof),
or each such Participating Broker-Dealer, as the case may be, any underwriter
participating in any such disposition of Registrable Notes, if any, and any
attorney, accountant or other agent retained by any such selling Holder or each
such Participating Broker-Dealer (with respect to any such Registration
Statement), as the case may be, or underwriter (any such Initial Purchasers,
Holders, Participating Broker-Dealers, underwriters, attorneys, accountants or
agents, collectively, the “Inspectors”),


 


17

















 


upon written request, at the
offices where normally kept, during reasonable business hours, all pertinent
financial and other records, pertinent corporate documents and instruments of
the Company and subsidiaries of the Company (collectively, the “Records”),
as shall be reasonably necessary to enable them to exercise any applicable due
diligence responsibilities, and cause the officers, directors and employees of
the Company and any of its subsidiaries to supply all information (“Information”)
reasonably requested by any such Inspector in connection with such due diligence
responsibilities.  Each Inspector shall
agree in writing that it will keep the Records and Information confidential and
that it will not disclose any of the Records or Information that the Company
determines, in good faith, to be confidential and notifies the Inspectors in
writing are confidential unless (i) the disclosure of such Records or Information
is necessary to avoid or correct a misstatement or omission in such Registration
Statement or Prospectus that the Company would be required to correct or avoid
pursuant to the terms of this Agreement, (ii) the release of such Records
or Information is ordered pursuant to a subpoena or other order from a court of
competent jurisdiction, or (iii) the information in such Records or
Information has been made generally available to the public other than by an
Inspector or an “affiliate” (as defined in Rule 405) thereof; provided,
however, that prior notice shall be provided as soon as practicable to
the Company of the potential disclosure of any information by such Inspector
pursuant to clauses (i) or (ii) of this sentence to permit the Company to
obtain a protective order (or waive the provisions of this paragraph (o))
and that such Inspector shall take such actions as are reasonably necessary to
protect the confidentiality of such information (if practicable) to the extent
such action is otherwise not inconsistent with, an impairment of or in
derogation of the rights and interests of the Holder or any Inspector.


 


(p)                                 Provide an indenture
trustee for the Registrable Notes or the Exchange Notes, as the case may be,
and cause the Indenture or the trust indenture provided for in
Section 2(a) hereof, as the case may be, to be qualified under the TIA not
later than the effective date of the first Registration Statement relating to
the Registrable Notes; and in connection therewith, cooperate with the trustee
under any such indenture and the Holders of the Registrable Notes, to effect
such changes (if any) to such indenture as may be required for such indenture to
be so qualified in accordance with the terms of the TIA; and execute, and use
its reasonable best efforts to cause such trustee to execute, all documents as
may be required to effect such changes, and all other forms and documents
required to be filed with the SEC to enable such indenture to be so qualified
in a timely manner.


 


(q)                                 Comply with all
applicable rules and regulations of the SEC and make generally available to its
securityholders with regard to any applicable Registration Statement, a
consolidated earning statement satisfying the provisions of Section 11(a)
of the Securities Act and Rule 158 thereunder (or any similar rule
promulgated under the Securities Act) no later than 45 days after the end
of any fiscal quarter (or 90 days


 


18

















 


after the end of any 12-month
period if such period is a fiscal year) (i) commencing at the end of any
fiscal quarter in which Registrable Notes are sold to underwriters in a firm
commitment or best efforts underwritten offering and (ii) if not sold to
underwriters in such an offering, commencing on the first day of the first
fiscal quarter of the Company, after the effective date of a Registration
Statement, which statements shall cover said 12-month periods.


 


(r)                                    Upon consummation
of the Exchange Offer or a Private Exchange, obtain an opinion of counsel to
the Company, in a form customary for underwritten transactions, addressed to
the Trustee for the benefit of all Holders of Registrable Notes participating
in the Exchange Offer or the Private Exchange, as the case may be, that the
Exchange Notes or Private Exchange Notes, as the case may be, and the related
indenture constitute legal, valid and binding obligations of the Company,
enforceable against the Company in accordance with its terms, subject to
customary exceptions and qualifications. 
If the Exchange Offer or a Private Exchange is to be consummated, upon
delivery of the Registrable Notes by Holders to the Company (or to such other
Person as directed by the Company), in exchange for the Exchange Notes or the
Private Exchange Notes, as the case may be, the Company shall mark, or cause to
be marked, on such Registrable Notes that such Registrable Notes are being cancelled
in exchange for the Exchange Notes or the Private Exchange Notes, as the case
may be; in no event shall such Registrable Notes be marked as paid or otherwise
satisfied.


 


(s)                                  Cooperate with each
seller of Registrable Notes covered by any Registration Statement and each
underwriter, if any, participating in the disposition of such Registrable Notes
and their respective counsel in connection with any filings required to be made
with the National Association of Securities Dealers, Inc. (the “NASD”).


 


(t)                                    Use its reasonable
best efforts to take all other steps necessary to effect the registration of
the Exchange Notes and/or Registrable Notes covered by a Registration Statement
contemplated hereby.


 


The Company may require each seller of Registrable Notes as to which
any registration is being effected to furnish to the Company such information
regarding such seller and the distribution of such Registrable Notes as the
Company may, from time to time, reasonably request.  The Company may exclude from such registration the Registrable
Notes of any seller so long as such seller fails to furnish such information
within a reasonable time after receiving such request.  Each seller as to which any Shelf
Registration is being effected agrees to furnish promptly to the Company all
information required to be disclosed in order to make the information
previously furnished to the Company by such seller not materially misleading.


 


19

















 


If any such Registration Statement refers to any Holder by name or
otherwise as the holder of any securities of the Company, then such Holder
shall have the right to require (i) the insertion therein of language, in
form and substance reasonably satisfactory to such Holder, to the effect that
the holding by such Holder of such securities is not to be construed as a
recommendation by such Holder of the investment quality of the securities
covered thereby and that such holding does not imply that such Holder will
assist in meeting any future financial requirements of the Company, or
(ii) in the event that such reference to such Holder by name or otherwise
is not required by the Securities Act or any similar federal statute then in
force, the deletion of the reference to such Holder in any amendment or
supplement to the Registration Statement filed or prepared subsequent to the
time that such reference ceases to be required.


 


Each Holder of Registrable Notes and each Participating Broker-Dealer
agrees by its acquisition of such Registrable Notes or Exchange Notes to be
sold by such Participating Broker-Dealer, as the case may be, that, upon actual
receipt of any notice from the Company of the happening of any event of the
kind described in Section 5(c)(ii), 5(c)(iv), 5(c)(v), or 5(c)(vi) hereof,
such Holder will forthwith discontinue disposition of such Registrable Notes
covered by such Registration Statement or Prospectus or Exchange Notes to be
sold by such Holder or Participating Broker-Dealer, as the case may be, until
such Holder’s or Participating Broker-Dealer’s receipt of the copies of the
supplemented or amended Prospectus contemplated by Section 5(k) hereof, or
until it is advised in writing (the “Advice”) by the Company that the
use of the applicable Prospectus may be resumed, and has received copies of any
amendments or supplements thereto.  In
the event that the Company shall give any such notice, each of the Applicable
Period and the Effectiveness Period shall be extended (but, in the case of the
Effectiveness Period, not beyond the second anniversary of the Issue Date) by
the number of days during such periods from and including the date of the
giving of such notice to and including the date when each seller of Registrable
Notes covered by such Registration Statement or Exchange Notes to be sold by
such Participating Broker-Dealer, as the case may be, shall have received
(x) the copies of the supplemented or amended Prospectus contemplated by
Section 5(k) hereof or (y) the Advice.


 


6.                                       Registration Expenses


 


All fees and expenses incident to the performance of or compliance with
this Agreement shall be borne by the Company, whether or not the Exchange Offer
Registration Statement or any Shelf Registration Statement is filed or becomes
effective or the Exchange Offer is consummated, including, without limitation,
(i) all registration and filing fees (including, without limitation,
(A) fees with respect to filings required to be made with the NASD in
connection with an underwritten offering and (B) fees and expenses of
compliance with state securities or Blue Sky laws (including, without limitation,
fees and disbursements of counsel in connection with Blue Sky qualifications of
the Registrable Notes or Exchange Notes and determination of the eligibility of
the Registrable Notes or Exchange Notes for investment


 


20

















 


under the laws of such jurisdictions (x) where the holders of
Registrable Notes are located, in the case of the Exchange Notes, or
(y) as provided in Section 5(h) hereof, in the case of Registrable
Notes or Exchange Notes to be sold by a Participating Broker-Dealer during the
Applicable Period)), (ii) printing expenses, including, without
limitation, expenses of printing certificates for Registrable Notes or Exchange
Notes in a form eligible for deposit with The Depository Trust Company and of
printing prospectuses if the printing of prospectuses is requested by the
managing underwriter or underwriters, if any, by the Holders of a majority in
aggregate principal amount of the Registrable Notes included in any
Registration Statement or in respect of Registrable Notes or Exchange Notes to
be sold by any Participating Broker-Dealer during the Applicable Period, as the
case may be, (iii) messenger, telephone and delivery expenses,
(iv) fees and disbursements of counsel for the Company and, in the case of
a Shelf Registration, reasonable fees and disbursements of one special counsel
for all of the sellers of Registrable Notes selected by the Holder of a
majority in aggregate principal amount of Registrable Notes covered by such
Shelf Registration (exclusive of any counsel retained pursuant to
Section 7 hereof), (v) fees and disbursements of all independent
certified public accountants referred to in Section 5(n)(iii) hereof
(including, without limitation, the expenses of any “cold comfort” letters required
by or incident to such performance), (vi) Securities Act liability
insurance, if the Company desires such insurance, (vii) fees and expenses
of all other Persons retained by the Company, (viii) internal expenses of
the Company (including, without limitation, all salaries and expenses of
officers and employees of the Company performing legal or accounting duties),
(ix) the expense of any annual audit, (x) any fees and expenses
incurred in connection with the listing of the securities to be registered on
any securities exchange, and the obtaining of a rating of the securities, in
each case, if applicable and (xi) the expenses relating to printing, word
processing and distributing all Registration Statements, underwriting
agreements, indentures and any other documents necessary in order to comply
with this Agreement.


 


7.                                       Indemnification and Contribution


 


(a)                                  The
Company agrees to indemnify and hold harmless each Holder of Registrable Notes
and each Participating Broker-Dealer selling Exchange Notes during the
Applicable Period, and each Person, if any, who controls such Person or its
affiliates within the meaning of Section 15 of the Securities Act or
Section 20 of the Exchange Act (each, a “Participant”) against any
losses, claims, damages or liabilities to which any Participant may become
subject under the Securities Act, the Exchange Act or otherwise, insofar as any
such losses, claims, damages or liabilities (or actions in respect thereof)
arise out of or are based upon:


 


(i)                                     any
untrue statement or alleged untrue statement of any material fact contained in
any Registration Statement (or any amendment thereto) or Prospectus (as amended
or supplemented if the Company shall have furnished any amendments or
supplements thereto) or any preliminary prospectus; or


 


21

















 


(ii)                                  the
omission or alleged omission to state, (a) in any Registration Statement (or
any amendment thereto), a material fact required to be stated therein or necessary
to make the statements therein not misleading or (b) in any Prospectus (as
amended or supplemented if the Company shall have furnished any amendments or
supplements thereto) or any preliminary prospectus or any amendment or
supplement thereto, a material fact necessary to make the statements therein,
in the light of the circumstances under which they were made, not misleading;


 


and will reimburse, as incurred, the Participant for any legal or other
expenses reasonably incurred by the Participant in connection with
investigating, defending against or appearing as a third-party witness in
connection with any such loss, claim, damage, liability or action; provided,
however, the Company will not be liable in any such case to the extent
that any such loss, claim, damage, or liability arises out of or is based upon
any untrue statement or alleged untrue statement or omission or alleged
omission made in any Registration Statement (or any amendment thereto) or
Prospectus (as amended or supplemented if the Company shall have furnished any
amendments or supplements thereto) or any preliminary prospectus in reliance
upon and in conformity with information relating to any Participant furnished
to the Company by such Participant specifically for use therein.  The indemnity provided for in this Section 7
will be in addition to any liability that the Company may otherwise have to the
indemnified parties.


 


(b)                                 Each
Participant, severally and not jointly, agrees to indemnify and hold harmless
the Company, its directors, its officers and each person, if any, who controls
the Company within the meaning of Section 15 of the Securities Act or
Section 20 of the Exchange Act against any losses, claims, damages or
liabilities to which the Company or any such director, officer or controlling
person may become subject under the Securities Act, the Exchange Act or
otherwise, insofar as such losses, claims, damages or liabilities (or actions
in respect thereof) arise out of or are based upon (i) any untrue
statement or alleged untrue statement of any material fact contained in any
Registration Statement or Prospectus, any amendment or supplement thereto, or
any preliminary prospectus, or (ii) the omission or the alleged omission
to state therein a material fact required to be stated therein or necessary to
make the statements therein 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 reliance upon and in conformity with
written information concerning such Participant, furnished to the Company by
the Participant, specifically for use therein; and subject to the limitation
set forth immediately preceding this clause, will reimburse, as incurred, any legal
or other expenses reasonably incurred by the Company or any such director,
officer or controlling person in connection with investigating or defending
against or appearing as a third party witness in connection with any such loss,
claim, damage, liability or action in respect thereof.


 


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(c)                                  Promptly
after receipt by an indemnified party under this Section 7 of notice of
the commencement of any action for which such indemnified party is entitled to
indemnification under this Section 7, such indemnified party will, if a
claim in respect thereof is to be made against the indemnifying party under
this Section 7, notify the indemnifying party of the commencement thereof
in writing; but the omission to so notify the indemnifying party will not
relieve the indemnifying party from any obligations to any indemnified party
other than the indemnification obligation provided in paragraphs (a) and (b)
above.  In case any such action is
brought against any indemnified party, and it notifies the indemnifying party
of the commencement thereof, the indemnifying party will be entitled to
participate therein and, to the extent that it may wish, jointly with any other
indemnifying party similarly notified, to assume the defense thereof, with
counsel reasonably satisfactory to such indemnified party; provided, however,
that if the defendants in any such action include both the indemnified party
and the indemnifying party and the indemnified party shall have been advised by
counsel that there may be one or more legal defenses available to it and/or
other indemnified parties that are different from or additional to those
available to the indemnifying party, then the indemnifying party shall not have
the right to direct the defense of such action on behalf of such indemnified
party or parties and such indemnified party or parties shall have the right to
select separate counsel to defend such action on behalf of such indemnified
party or parties.  After notice from the
indemnifying party to such indemnified party of its election so to assume the
defense thereof and approval by such indemnified party of counsel appointed to
defend such action, the indemnifying party will not be liable to such
indemnified party under this Section 7 for any legal or other expenses,
other than reasonable costs of investigation, 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 immediately preceding sentence (it being understood, however,
that in connection with such action the indemnifying party shall not be liable
for the expenses of more than one separate counsel (in addition to local
counsel) in any one action or separate but substantially similar actions in the
same jurisdiction arising out of the same general allegations or circumstances,
designated by Participants who sold a majority in interest of the Registrable
Notes and Exchange Notes sold by all such Participants in the case of paragraph
(a) of this Section 7, representing the indemnified parties under such
paragraph (a) who are parties to such action or actions) or (ii) the
indemnifying party has authorized in writing the employment of counsel for the
indemnified party at the expense of the indemnifying party.  All fees and expenses reimbursed pursuant to
this paragraph (c) shall be reimbursed as they are incurred.  After such notice from the indemnifying
party to such indemnified party, the indemnifying party will not be liable for
the costs and expenses of any settlement of such action effected by such
indemnified party without the consent of the indemnifying party.  The Company shall not, without the prior
written consent of such Participant, settle or compromise or consent to the
entry of any judgment in and pending or threatened claim, action, suit or
proceeding in respect of which indemnification may be sought hereunder by such
Participant (whether or not such Participant is a party to such claim, action
or proceeding), unless such settlement, compromise or consent (A) includes an
unconditional release of such Participant


 


23

















 


from all
liability arising out of such claim, action, suit or proceeding and (B) does
not include any statement as to an admission of fault, culpability or failure
to act by or on behalf of such Participant.


 


(d)                                 In
circumstances in which the indemnity agreement provided for in the preceding
paragraphs of this Section 7 is unavailable to, or insufficient to hold
harmless, an indemnified party in respect of any losses, claims, damages or
liabilities (or actions in respect thereof), each indemnifying party, in order
to provide for just and equitable contribution, shall contribute to the amount
paid or payable by such indemnified party as a result of such losses, claims,
damages or liabilities (or actions in respect thereof) in such proportion as is
appropriate to reflect (i) the relative benefits received by the indemnifying
party or parties on the one hand and the indemnified party on the other from
the offering of the Notes or (ii) if the allocation provided by the foregoing
clause (i) is not permitted by applicable law, not only such relative benefits
but also the relative fault of the indemnifying party or parties on the one
hand and the indemnified party on the other in connection with the statements
or omissions or alleged statements or omissions that resulted in such losses,
claims, damages or liabilities (or actions in respect thereof), as well as any
other relevant equitable considerations. 
The relative benefits received by the Company on the one hand and such
Participant on the other shall be deemed to be in the same proportion as the
total proceeds from the offering (before deducting expenses) of the Notes
received by the Company bear to the total net profit received by such
Participant in connection with the sale of the Notes.  The relative fault of the parties shall be determined by
reference to, among other things, whether the untrue or alleged untrue
statement of a material fact or the omission or alleged omission to state a
material fact relates to information supplied by the Company or such
Participant, the parties’ relative intent, knowledge, access to information and
opportunity to correct or prevent such statement or omission or alleged
statement or omission, and any other equitable considerations appropriate in
the circumstances.  The parties agree
that it would not be equitable if the amount of such contribution were
determined by pro rata or per capita allocation or by any other method of
allocation that does not take into account the equitable considerations
referred to above in this paragraph (d). 
Notwithstanding any other provision of this paragraph (d), no
Participant shall be obligated to make contributions hereunder that in the
aggregate exceed the total net profit received by such Participant in
connection with the sale of the Notes, less the aggregate amount of any damages
that such Participant has otherwise been required to pay in respect of the same
or any substantially similar claim, and no person guilty of fraudulent
misrepresentation (within the meaning of Section 11(f) of the Securities
Act) shall be entitled to contribution from any person who was not guilty of
such fraudulent misrepresentation.  The
Participants’ obligations to contribute pursuant to this paragraph (d) are
several and not joint.  For purposes of
this paragraph (d), each person, if any, who controls a Participant within the
meaning of Section 15 of the Securities Act or Section 20 of the
Exchange Act shall have the same rights to contribution as the Participants,
and each director of the Company, each officer of the Company and each person,
if any, who controls the Company within the meaning of Section 15


 


24

















 


of the
Securities Act or Section 20 of the Exchange Act, shall have the same
rights to contribution as the Company.


 


(e)                                  The
remedies provided for in this Section 7 are not exclusive and shall not
limit any rights or remedies which may otherwise be available to any
indemnified party of law or in equity.


 


8.                                       Rules 144 and 144A


 


The Company covenants and agrees that it will file the reports required
to be filed by it under the Securities Act and the Exchange Act and the rules
and regulations adopted by the SEC thereunder in a timely manner in accordance
with the requirements of the Securities Act and the Exchange Act and, if at any
time the Company is not required to file such reports, the Company will, upon
the request of any Holder or beneficial owner of Registrable Notes, make
available such information necessary to permit sales pursuant to
Rule 144A.  The Company further
covenants and agrees, for so long as any Registrable Notes remain outstanding
that it will take such further action as any Holder of Registrable Notes may
reasonably request, all to the extent required from time to time to enable such
holder to sell Registrable Notes without registration under the Securities Act
within the limitation of the exemptions provided by Rule 144(k) under the
Securities Act and Rule 144A.


 


9.                                       Underwritten Registrations


 


If any of the Registrable Notes covered by any Shelf Registration are
to be sold in an underwritten offering, the investment banker or investment
bankers and manager or managers that will manage the offering will be selected
by the Holders of a majority in aggregate principal amount of such Registrable
Notes included in such offering and shall be reasonably acceptable to the
Company.


 


No Holder of Registrable Notes may participate in any underwritten
registration hereunder unless such Holder (a) agrees to sell such Holder’s
Registrable Notes on the basis provided in any underwriting arrangements
approved by the Persons entitled hereunder to approve such arrangements and
(b) completes and executes all questionnaires, powers of attorney,
indemnities, underwriting agreements and other documents required under the
terms of such underwriting arrangements.


 


10.                                 Miscellaneous


 


(a)                                  No
Inconsistent Agreements.  The
Company has not, as of the date hereof, and shall not, after the date of this
Agreement, enter into any agreement with respect to any of its securities that
is inconsistent with the rights granted to the Holders of Registrable Notes 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


 


25

















 


rights granted
to the holders of the Company’s other issued and outstanding securities under
any such agreements.  The Company will
not enter into any agreement with respect to any of its securities which will
grant to any Person piggy-back registration rights with respect to any Registration
Statement.


 


(b)                                 Adjustments
Affecting Registrable Notes.  The
Company shall not, directly or indirectly, take any action with respect to the
Registrable Notes as a class that would adversely affect the ability of the
Holders of Registrable Notes to include such Registrable Notes in a
registration undertaken pursuant to this Agreement.


 


(c)                                  Amendments
and Waivers.  The provisions of this
Agreement may not be amended, modified or supplemented, and waivers or consents
to departures from the provisions hereof may not be given, otherwise than with
the prior written consent of (I) the Company, and (II) (A) the
Holders of not less than a majority in aggregate principal amount of the then
outstanding Registrable Notes and (B) in circumstances that would
adversely affect the Participating Broker-Dealers, the Participating
Broker-Dealers holding not less than a majority in aggregate principal amount
of the Exchange Notes held by all Participating Broker-Dealers; provided,
however, that Section 7 and this Section 10(c) may not be
amended, modified or supplemented without the prior written consent of each
Holder and each Participating Broker-Dealer (including any person who was a
Holder or Participating Broker-Dealer of Registrable Notes or Exchange Notes,
as the case may be, disposed of pursuant to any Registration Statement)
affected by any such amendment, modification or supplement.  Notwithstanding the foregoing, a waiver or
consent to depart from the provisions hereof with respect to a matter that
relates exclusively to the rights of Holders of Registrable Notes whose securities
are being sold pursuant to a Registration Statement and that does not directly
or indirectly affect, impair, limit or compromise the rights of other Holders
of Registrable Notes may be given by Holders of at least a majority in aggregate
principal amount of the Registrable Notes being sold pursuant to such
Registration Statement.


 


(d)                                 Notices.  All notices and other communications
(including, without limitation, any notices or other communications to the
Trustee) provided for or permitted hereunder shall be made in writing by
hand-delivery, registered first-class mail, next-day air courier or facsimile:


 


(i)                                     if
to a Holder of the Registrable Notes or any Participating Broker-Dealer, at the
most current address of such Holder or Participating Broker-Dealer, as the case
may be, set forth on the records of the registrar under the Indenture, with a
copy in like manner to the Initial Purchasers as follows:


 


26

















 


J.P. Morgan Securities Inc.

270 Park Avenue, 7th Floor

New York, New York  10017

Facsimile No.:  (212) 834-6702

Attention:  Transaction Execution Group


 


with a copy to:


 


Cahill Gordon & Reindel LLP

80 Pine Street

New York, New York  10005

Facsimile No.:  (212) 269-5420 

Attention:  William M. Hartnett, Esq.


 


(ii)                                  if
to the Initial Purchasers, at the address specified in Section 10(d)(i);


 


(iii)                               if
to the Company, at the address as follows:


 


iStar Financial Inc.

1114 Avenue of the Americas, 27th Floor

New York, New York 10036

Facsimile No.:  (212) 930-9411

Attention:  Chief Executive Officer


 


with a copy to:


 


Clifford Chance US LLP

200 Park Avenue

52nd Floor

New York, New York 10166 

Facsimile No.:  (212) 878-8375

Attention:  Kathleen Werner, Esq.


 


All such notices and communications shall be deemed to have been duly
given:  when delivered by hand, if
personally delivered; five Business Days after being deposited in the mail,
postage prepaid, if mailed; one Business Day after being timely delivered to a next-day
air courier; and upon written confirmation, if sent by facsimile.


 


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 and in the manner specified in such Indenture.


 


27

















 


(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 hereto, the Holders and the Participating Broker-Dealers; provided,
however, that nothing herein shall be deemed to permit any assignment,
transfer or other disposition of Registrable Notes in violation of the terms of
the Purchase Agreement or the Indenture.


 


(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.  THIS AGREEMENT SHALL BE
GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK,
AS APPLIED TO CONTRACTS MADE AND PERFORMED ENTIRELY WITHIN THE STATE OF NEW
YORK, WITHOUT REGARD TO PRINCIPLES OF CONFLICTS OF LAW THAT WOULD REQUIRE THE
APPLICATION OF ANY OTHER LAW.


 


(i)                                     Severability.  If any term, provision, covenant or
restriction of this Agreement is held by a court of competent jurisdiction to
be invalid, illegal, void or unenforceable, the remainder of the terms,
provisions, covenants and restrictions set forth herein shall remain in full
force and effect and shall in no way be affected, impaired or invalidated, and
the parties hereto shall use their best efforts to find and employ an
alternative means to achieve the same or substantially the same result as that
contemplated by such term, provision, covenant or restriction.  It is hereby stipulated and declared to be
the intention of the parties that they would have executed the remaining terms,
provisions, covenants and restrictions without including any of such that may
be hereafter declared invalid, illegal, void or unenforceable.


 


(j)                                     Notes
Held by the Company or Its Affiliates. 
Whenever the consent or approval of Holders of a specified percentage of
Registrable Notes is required hereunder, Registrable Notes held by the Company
or its affiliates (as such term is defined in Rule 405 under the
Securities Act) shall not be counted in determining whether such consent or
approval was given by the Holders of such required percentage.


 


(k)                                  Third-Party
Beneficiaries.  Holders of
Registrable Notes and Participating Broker-Dealers are intended third-party
beneficiaries of this Agreement, and this Agreement may be enforced by such
Persons.


 


28

















 


(l)                                     Entire
Agreement.  This Agreement, together
with the Purchase Agreement and the Indenture, is intended by the parties as a
final and exclusive statement of the agreement and understanding of the parties
hereto in respect of the subject matter contained herein and therein and any
and all prior oral or written agreements, representations, or warranties,
contracts, understandings, correspondence, conversations and memoranda between
the Holders on the one hand and the Company on the other, or between or among
any agents, representatives, parents, subsidiaries, affiliates, predecessors in
interest or successors in interest with respect to the subject matter hereof
and thereof are merged herein and replaced hereby.


 


29

















 


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


 


 


	
   

  	
  iSTAR FINANCIAL INC.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
  Title:

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
  Title:

  



 


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  The
  foregoing Agreement is hereby

  confirmed and accepted as of the date

  first above written.

  	
   

  
	
   

  	
   

  
	
  J.P. MORGAN SECURITIES INC.

  GOLDMAN, SACHS & CO.

  BEAR, STEARNS & CO. INC.

  CITIGROUP GLOBAL MARKETS INC.

  DEUTSCHE BANK SECURITIES INC.

  LEHMAN BROTHERS INC.

  MERRILL LYNCH, PIERCE, FENNER & SMITH

  INCORPORATED

  WACHOVIA CAPITAL MARKETS, LLC

  	
   

  
	
   

  	
   

  
	
  By:  J.P. MORGAN SECURITIES INC.

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
  By:

  	
   

  	
   

  	
   

  
	
   

  	
  Name:

  	
   

  
	
   

  	
  Title:

  	
   

  
				



 


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