Document:

Exhibit 4.1

 

[Face of Note]

[Insert the Global Note Legend, if applicable
pursuant to the provisions of the 

Supplemental Indenture]

 

	
   

  	
   

  	
   

  	
  CUSIP 45031UAU5

  
	
   

  	
  5.80% Senior Notes due 2011

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  No. 1

  	
   

  	
   

  	
  $250,000,000

  
	
   

  	
  iSTAR FINANCIAL INC.

  	
   

  	
   

  

 

promises to pay to                                                                ,
or registered assigns, the principal sum of TWO HUNDRED AND FIFTY MILLION
DOLLARS on March 15, 2011.

 

Interest Payment Dates:  June 15
and December 15

 

Record Dates:  June 1 and December 1

 

Dated:  December 14, 2005

 

	
   

  	
  iSTAR FINANCIAL INC.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
  Title:

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
  Title:

  

 

SEAL

 

This is one of the Notes referred to

in the within-mentioned Supplemental Indenture:

 

US BANK TRUST NATIONAL ASSOCIATION

as Trustee

 

 

	
  By:

  	
   

  	
   

  
	
   

  	
    Authorized Signatory

  

 

1

 

[Back of Note]

5.80% Senior Notes due 2011

 

Capitalized terms used herein shall have the meanings
assigned to them in the Indenture referred to below unless otherwise indicated.

 

1.  INTEREST.  iStar Financial Inc., a Maryland corporation
(the “Company”), promises to pay interest on
the principal amount of this note at 5.80% per annum from December 14,
2005 until maturity.  The company will
pay interest semi-annually in arrears on June 15 and December 15 of
each year, or if any such day is not a Business Day, on the next succeeding
Business Day (each an “Interest Payment Date”).  Interest on the notes will accrue from the
most recent date to which interest has been paid or, if no interest has been
paid, from December 14, 2005; provided that
if there is no existing default in the payment of interest, and if this note is
authenticated between a record date referred to on the face hereof and the next
succeeding interest payment date, interest shall accrue from such next
succeeding interest payment date; provided, further,
that the first interest payment date shall be June 15, 2006.  The company shall pay interest (including
post-petition interest in any proceeding under any bankruptcy law) on
overdue principal and premium, if any, from time to time on demand at the rate
then in effect; it shall pay interest (including post-petition interest in any
proceeding under any bankruptcy law) on overdue installments of interest
(without regard to any applicable grace periods) from time to time on
demand at the same rate to the extent lawful. 
Interest will be computed on the basis of a 360-day year of twelve 30-day
months.  If any interest payment date on the Notes other than the maturity date is
not a Business Day, such interest payment date will be postponed to the next
succeeding Business Day. If the maturity date of the Notes falls on a day that
is not a Business Day, the required payment of principal and interest will be
made on the next succeeding Business Day as if made on the date such payment
was due, and no interest will accrue on such payment for the period from and
after the maturity date to the date of such payment on the next succeeding
Business Day.

 

2.  METHOD OF PAYMENT.  The
Company will pay interest on the Notes (except defaulted interest) to the
Persons who are registered Holders of Notes at the close of business on the June 1
or December 1 next preceding the Interest Payment Date, even if such Notes
are canceled after such record date and on or before such Interest Payment
Date, except as provided in Section 2.12 of the Indenture with respect to
defaulted interest.  The Notes will be
payable as to principal, premium, if any, and interest at the office or agency
of the Company maintained for such purpose within or without the City and State
of New York, or, at the option of the Company, payment of interest may be made
by check mailed to the Holders at their addresses set forth in the register of
Holders, and provided that payment by wire
transfer of immediately available funds will be required with respect to
principal of and interest, and premium, if any, on, all Global Notes and all
other Notes the Holders of which shall have provided wire transfer instructions
to the Company or the Paying Agent.  Such
payment shall be in such coin or currency of the United States of America as at
the time of payment is legal tender for payment of public and private debts.  The Company reserves the right to pay
interest to Holders of Notes by check mailed to such Holders at their
registered addresses or by wire transfer to Holders of at least $5 million
aggregate principal amount of Notes.

 

3.  PAYING AGENT AND REGISTRAR. 
Initially, US Bank Trust National Association, the Trustee under the Indenture,
will act as Paying Agent and Registrar. 
The Company may change any Paying Agent or Registrar without notice to
any Holder.  The Company or any of its
Subsidiaries may act in any such capacity.

 

4.  INDENTURE.  The
Company issued the Notes under an Indenture dated as of February 5, 2001,
as amended and supplemented, including as supplemented by a Supplemental
Indenture dated as of December 14, 2005 (collectively, the “Indenture”) between the Company and the Trustee.  The terms of

 

2

 

the Notes include those stated in the Indenture and those made part of
the Indenture by reference to the Trust Indenture Act of 1939, as amended (15
U.S. Code §§ 77aaa-77bbbb).  The
Notes are subject to all such terms, and Holders are referred to the Indenture
and such Act for a statement of such terms. 
To the extent any provision of this Note conflicts with the express
provisions of the Indenture, the provisions of the Indenture shall govern and
be controlling.  The Notes are
obligations of the Company.  The Company
is issuing $250.0 million in aggregate principal amount on the Issue Date and
may issue Additional Notes in accordance with the terms of the Indenture.

 

5.  OPTIONAL REDEMPTION.

 

The Notes may be redeemed or purchased in whole or in
part at the Company’s option at any time prior to the maturity of the Notes at
a price equal to 100% of the principal amount thereof plus the Applicable
Premium as of, and accrued but unpaid interest, if any, to the date of the redemption
or purchase (the “Redemption Date”) (subject to the right of Holders of
record on the relevant record date to receive interest due on the relevant
interest payment date).

 

“Applicable Premium”
means, with respect to the Notes at any Redemption Date, the greater of: (1) 1.0%
of the principal amount of such Note; and (2) the excess of (a) the
present value at such Redemption Date of (i) the principal amount of such
Note on the redemption date plus (ii) all required remaining scheduled
interest payments due on such Note through March 15, 2011, computed using
a discount rate equal to the Treasury Rate plus 25 basis points; over (b) the
principal amount of such Note on such Redemption Date.  Calculation of the Applicable Premium will be
made by the Company or on behalf of the Company by such Person as the Company
shall designate; provided, however, that such
calculation shall not be a duty or obligation of the Trustee.

 

“Treasury Rate”
means, with respect to a Redemption Date, the yield to maturity at the time of
computation of United States Treasury securities with a constant maturity (as
compiled and published in the most recent Federal Reserve Statistical Release
H.15(519) that has become publicly available on the third Business Day
prior to our providing notice of redemption (or, if such Statistical Release is
no longer published, any publicly available source of similar market
data)) most nearly equal to the period from such Redemption Date to the
maturity date; provided, however, that if the
period from such Redemption Date to the maturity date is not equal to the
constant maturity of the United States Treasury security for which a weekly
average yield is given, the Treasury Rate shall be obtained by linear
interpolation (calculated to the nearest one-twelfth of a year) from the
weekly average yields of United States Treasury securities for which such
yields are given, except that if the period from such Redemption Date to the
maturity date is less than one year, the weekly average yield on actually traded
United States Treasury securities adjusted to a constant maturity of one year
shall be used.

 

6.  MANDATORY REDEMPTION.

 

The Company shall not be required to make mandatory
redemption payments with respect to the Notes.

 

7.  NOTICE OF REDEMPTION. 
Notice of redemption will be mailed at least 30 days but not more than
60 days before the redemption date to each Holder whose Notes are to be
redeemed at its registered address. 
Notes in denominations larger than $1,000 may be redeemed in part but
only in whole multiples of $1,000, unless all of the Notes held by a Holder are
to be redeemed.  On and after the
redemption date interest ceases to accrue on Notes or portions thereof called
for redemption.

 

8.  DENOMINATIONS, TRANSFER, EXCHANGE.  The Notes are in registered form without
coupons in denominations of $1,000 and integral multiples of $1,000.  The transfer of Notes may be

 

3

 

registered and Notes may be exchanged as provided in the
Indenture.  The Registrar and the Trustee
may require a Holder, among other things, to furnish appropriate endorsements
and transfer documents and the Company and the Trustee may require a Holder to
pay any taxes and fees required by law or permitted by the Indenture.  The Company need not exchange or register the
transfer of any Note or portion of a Note selected for redemption, except for
the unredeemed portion of any Note being redeemed in part.  Also, the Company need not exchange or register
the transfer of any Notes for a period of 15 days before a selection of Notes
to be redeemed or during the period between a record date and the corresponding
Interest Payment Date.

 

9.  PERSONS DEEMED OWNERS. 
The registered Holder of a Note may be treated as its owner for all
purposes.

 

10.  AMENDMENT, SUPPLEMENT AND WAIVER.  Subject to certain exceptions, the Indenture
or the Notes may be amended or supplemented with the written consent of the
Holders of at least a majority in principal amount of the then outstanding
Notes voting as a single class, and any existing default or compliance with any
provision of the Indenture or the Notes may be waived with the written consent
of the Holders of a majority in principal amount of the then outstanding Notes
voting as a single class.  Without the consent
of any Holder of a Note, the Indenture or the Notes may be amended or
supplemented to cure any ambiguity, defect or inconsistency, to provide for
uncertificated Notes in addition to or in place of certificated Notes, to
provide for the assumption of the Company’s obligations to Holders of the Notes
in case of a merger or consolidation, to make any change that would provide any
additional rights or benefits to the Holders of the Notes or that does not
adversely affect in any material respects the rights under the Indenture of any
such Holder, to comply with the requirements of the SEC in order to effect or
maintain the qualification of the Indenture under the Trust Indenture Act or to
evidence and provide for the acceptance of appointment under the Indenture of a
successor Trustee.

 

11.  DEFAULTS AND REMEDIES. 
Events of Default are set forth in the Indenture.  If any Event of Default occurs and is
continuing, the Trustee or the Holders of at least 25% in principal amount of
the then outstanding Notes may declare all the Notes to be due and
payable.  Notwithstanding the foregoing,
in the case of an Event of Default arising from certain events of bankruptcy or
insolvency, all outstanding Notes will become due and payable without further
action or notice.  Holders may not
enforce the Indenture or the Notes except as provided in the Indenture.  Subject to certain limitations, Holders of a
majority in principal amount of the then outstanding Notes may direct the
Trustee in writing in its exercise of any trust or power.  The Trustee may withhold from Holders of the
Notes notice of any continuing Default or Event of Default (except a Default or
Event of Default relating to the payment of principal or interest) if it
determines that withholding notice is in their interest.  The Holders of a majority in aggregate
principal amount of the Notes then outstanding by written notice to the Trustee
may on behalf of the Holders of all of the Notes waive any existing Default or
Event of Default and its consequences under the Indenture except a continuing
Default or Event of Default in the payment of interest on, or the principal of,
the Notes.  The Company is required to
deliver to the Trustee annually a statement regarding compliance with the
Indenture, and the Company is required upon becoming aware of any Default or
Event of Default, to deliver to the Trustee a statement specifying such Default
or Event of Default.

 

12.  TRUSTEE DEALINGS WITH COMPANY.  The Trustee, in its individual or any other
capacity, may make loans to, accept deposits from, and perform services for the
Company or its Affiliates, and may otherwise deal with the Company or its
Affiliates, as if it were not the Trustee.

 

13.  NO RECOURSE AGAINST OTHERS. 
A director, officer, employee, incorporator or stockholder, of the
Company, as such, shall not have any liability for any obligations of the
Company under the Notes or the Indenture or for any claim based on, in respect
of, or by reason of, such obligations

 

4

 

or their creation.  Each Holder
by accepting a Note waives and releases all such liability.  The waiver and release are part of the
consideration for the issuance of the Notes.

 

14.  AUTHENTICATION.  This
Note shall not be valid until authenticated by the manual signature of the
Trustee or an authenticating agent.

 

15.  ABBREVIATIONS.  Customary
abbreviations may be used in the name of a Holder or an assignee, such as:  TEN COM (= tenants in common), TEN ENT (=
tenants by the entireties), JT TEN (= joint tenants with right of survivorship
and not as tenants in common), CUST (= Custodian), and U/G/M/A (= Uniform Gifts
to Minors Act).

 

16.  CUSIP NUMBERS.  Pursuant
to a recommendation promulgated by the Committee on Uniform Security
Identification Procedures, the Company has caused CUSIP numbers to be printed
on the Notes and the Trustee may use CUSIP numbers in notices of redemption as
a convenience to Holders.  No
representation is made as to the accuracy of such numbers either as printed on
the Notes or as contained in any notice of redemption and reliance may be
placed only on the other identification numbers placed thereon.

 

5

 

The Company will furnish to any Holder upon written
request and without charge a copy of the Indenture.  Requests may be made to:

 

iStar Financial Inc.

1114 Avenue of the Americas, 27th Floor

New York, NY 10036

Attention:  Investor Relations

 

6

 

ASSIGNMENT FORM

 

To assign this Note, fill in the form below:

 

	
  (I) or (we) assign and transfer this Note
  to:

  	
   

  
	
   

  	
  (Insert assignee’s legal name)

  

 

(Insert assignee’s soc. sec. or tax I.D. no.)

	
   

  
	
   

  
	
   

  
	
  (Print or type assignee’s name, address and zip
  code)

  

 

and irrevocably appoint
                                                                                                          
to transfer this Note on the books of the Company. The agent may substitute
another to act for him.

 

	
  Date:

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Your Signature:

  	
   

  	
   

  
	
   

  	
   

  	
  (Sign exactly as your name appears on

  the face of this Note)

  

 

	
  Signature Guarantee*:

  	
   

  	
   

  

 

*                                         Participant
in a recognized Signature Guarantee Medallion Program (or other signature
guarantor acceptable to the Trustee).

 

7

 

SCHEDULE OF EXCHANGES OF INTERESTS IN THE GLOBAL NOTE

 

The following exchanges of a part of this Global Note
for an interest in another Global Note or for a Definitive Note, or exchanges
of a part of another Global Note or Definitive Note for an interest in this
Global Note, have been made:

 

	
  Date of Exchange

  	
   

  	
  Amount of

  decrease in

  Principal Amount 

  of this Global Note

  	
   

  	
  Amount of

  increase in

  Principal Amount 

  of this Global Note

  	
   

  	
  Principal Amount

  of this Global Note

  following such

  decrease

  (or increase)

  	
   

  	
  Signature of

  authorized officer

  of Trustee or Note

  Custodian

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  

 

8Exhibit 4.2

 

[Face of Note]

[Insert the Global Note Legend, if applicable
pursuant to the provisions of the 

Supplemental Indenture]

 

	
   

  	
   

  	
   

  	
  CUSIP 45031UAV3

  
	
   

  	
  Senior Floating Rate Notes due 2009

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  No.       

  	
   

  	
   

  	
  $225,000,000

  
	
   

  	
  iSTAR FINANCIAL INC.

  	
   

  	
   

  

 

promises to pay to
                                                                        
, or registered assigns, the principal sum of TWO HUNDRED AND TWENTY FIVE
MILLION Dollars on March 16, 2009.

 

Interest Payment Dates:  March 16,
June 16, September 16 and December 16

 

Record Dates: March 1, June 1, September 1 and December 1

 

Dated:  December 14, 2005

 

	
   

  	
  iSTAR FINANCIAL INC.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
  Title:

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
  Title:

  
					

 

	
  SEAL

  
	
   

  
	
  This is one of the
  Notes referred to

  
	
  in the within-mentioned
  Supplemental Indenture:

  
	
   

  
	
  US BANK TRUST NATIONAL
  ASSOCIATION 

  as Trustee

  
	
   

  
	
   

  
	
  By:

  	
   

  	
   

  
	
   

  	
    Authorized
  Signatory

  

 

1

 

[Back of Note]

Senior Floating Rate Notes due 2009

 

Capitalized terms used herein shall have the meanings
assigned to them in the Indenture referred to below unless otherwise indicated.

 

1.  INTEREST.  iStar
Financial Inc., a Maryland corporation (the “Company”),
promises to pay interest on the principal amount of this note quarterly in arrears
on March 16, June 16, September 16 and December 16 of each
year, or if any such day is not a Business Day, on the next succeeding Business
Day (each an “Interest Payment Date”) at
the rate per annum, reset quarterly (the “interest reset period”
and the first date in such period, the “interest reset date”),
equal to three-month LIBOR (as defined below) plus 0.55% to be determined
by the calculation agent.  Interest on
the notes will accrue from the most recent date to which interest has been paid
or, if no interest has been paid, from December 14, 2005; provided that if there is no existing default in the payment
of interest, and if this note is authenticated between a record date referred
to on the face hereof and the next succeeding interest payment date, interest
shall accrue from such next succeeding interest payment date; provided, further, that the first interest payment date
shall be March 16, 2006.  The
company shall pay interest (including post-petition interest in any proceeding
under any bankruptcy law) on overdue principal and premium, if any, from
time to time on demand at the rate then in effect; it shall pay interest
(including post-petition interest in any proceeding under any bankruptcy
law) on overdue installments of interest (without regard to any applicable
grace periods) from time to time on demand at the same rate to the extent
lawful.  Interest will be computed on the
basis of a 360-day year using the actual number of days elapsed from and
including an interest payment date to but excluding the next succeeding
interest payment date.  If any interest
payment date on the Notes other than the maturity date is not a Business Day,
such interest payment date will be postponed to the next succeeding Business
Day, except that if such Business Day falls in the next succeeding calendar
month, such interest payment date will be the immediately preceding Business
Day:  If
the maturity date of the Notes falls on a day that is not a Business Day, the
required payment of principal and interest will be made on the next succeeding
Business Day as if made on the date such payment was due, and no interest will
accrue on such payment for the period from and after the maturity date to the
date of such payment on the next succeeding Business Day.

 

The interest rate on the
Notes applicable to each interest reset period commencing on the related
interest reset date, or the original issue date in the case of the initial
interest period, will be the rate determined as of the applicable interest
determination date.  The “interest
determination date” will be the second London business day immediately
preceding the original issue date, in the case of the initial interest reset
period, or thereafter the applicable interest reset date.

 

US Bank Trust National
Association, or its successor appointed by us, will act as calculation
agent.  Three-month LIBOR will be
determined by the calculation agent as of the applicable interest determination
date in accordance with the following provisions:

 

(i)                   LIBOR is the
rate for deposits in U.S. dollars for the three-month period which appears on
Moneyline Telerate Page 3750 (as defined below) at approximately
11:00 a.m., London time, on the applicable interest determination
date.  “Moneyline Telerate Page 3750”
means the display designated on page “3750” on Moneyline Telerate (or such
other page as may replace the 3750 page on that service, any
successor service or such other service or services as may be nominated by the
British Bankers’ Association for the purpose of displaying London interbank
offered rates for U.S. dollar deposits). 
If no rate appears on Moneyline Telerate Page 3750, LIBOR for such
interest determination date will be determined in accordance with the
provisions of paragraph (ii) below.

 

2

 

(ii)                With respect to an
interest determination date on which no rate appears on Moneyline Telerate Page 3750
at approximately 11:00 a.m., London time, on such interest determination
date, the calculation agent shall request the principal London offices of each
of four major reference banks (which may include affiliates of the
underwriters) in the London interbank market selected by the calculation
agent (after consultation with us) to provide the calculation agent with a
quotation of the rate at which deposits of U.S. dollars having a three-month
maturity, commencing on the second London business day immediately following
such interest determination date, are offered by it to prime banks in the
London interbank market as of approximately 11:00 a.m., London time, on
such interest determination date in a principal amount equal to an amount of
not less than U.S. $1,000,000 that is representative for a single transaction
in such market at such time.  If at least
two such quotations are provided, LIBOR for such interest determination date
will be the arithmetic mean of such quotations as calculated by the calculation
agent.  If fewer than two quotations are
provided, LIBOR for such interest determination date will be the arithmetic
mean of the rates quoted at approximately 11:00 a.m., New York City time,
on such interest determination date by three major banks (which may include
affiliates of the underwriters) selected by the calculation agent (after
consultation with us) for loans in U.S. dollars to leading European banks
having a three-month maturity commencing on the second London business day
immediately following such interest determination date and in a principal
amount equal to an amount of not less than U.S. $1,000,000 that is representative
for a single transaction in such market at such time; provided,
however, that if the banks selected as aforesaid by the calculation
agent are not quoting such rates as mentioned in this sentence, LIBOR for such
interest determination date will be LIBOR determined with respect to the
immediately preceding interest determination date.

 

All percentages resulting
from any calculation of any interest rate for the Notes will be rounded, if
necessary, to the nearest one hundred thousandth of a percentage point, with
five one-millionths of a percentage point rounded upward and all dollar amounts
will be rounded to the nearest cent, with one-half cent being rounded upward.

 

Promptly upon such
determination, the calculation agent will notify us and the Trustee (if the
calculation agent is not the Trustee) of the interest rate for the new
interest reset period.  Upon request of a
holder of the Notes, the calculation agent will provide to such holder the
interest rate in effect on the date of such request and, if determined, the
interest rate for the next interest reset period.

All calculations made by
the calculation agent for the purposes of calculating interest on the Notes
shall be conclusive and binding on the holders and the Company, absent manifest
error.

 

2.  METHOD OF PAYMENT.  The
Company will pay interest on the Notes (except defaulted interest) to the
Persons who are registered Holders of Notes at the close of business on the March 1,
June 1, September 1 and December 1 immediately preceding the
Interest Payment Date, even if such Notes are canceled after such record date
and on or before such Interest Payment Date, except as provided in Section 2.12
of the Indenture with respect to defaulted interest.  The Notes will be payable as to principal,
premium, if any, and interest at the office or agency of the Company maintained
for such purpose within or without the City and State of New York, or, at the
option of the Company, payment of interest may be made by check mailed to the
Holders at their addresses set forth in the register of Holders, and provided that payment by wire transfer of immediately
available funds will be required with respect to principal of and interest, and
premium, if any, on, all Global Notes and all other Notes the Holders of which
shall have provided wire transfer instructions to the Company or the Paying
Agent.  Such payment shall be in such
coin or currency of the United States of America as at the time of payment is
legal tender for payment of public and private debts.  The Company reserves the right to pay
interest to Holders of 

 

3

 

Notes by check mailed to such Holders at their registered addresses or
by wire transfer to Holders of at least $5 million aggregate principal amount
of Notes.

 

3.  PAYING AGENT AND REGISTRAR. 
Initially, US Bank Trust National Association, the Trustee under the
Indenture, will act as Paying Agent and Registrar.  The Company may change any Paying Agent or
Registrar without notice to any Holder. 
The Company or any of its Subsidiaries may act in any such capacity.

 

4.  INDENTURE.  The
Company issued the Notes under an Indenture dated as of February 5, 2001,
as amended and supplemented, including as supplemented by a Supplemental
Indenture dated as of December 14, 2005 (collectively, the “Indenture”) between the Company and the Trustee.  The terms of the Notes include those stated
in the Indenture and those made part of the Indenture by reference to the Trust
Indenture Act of 1939, as amended (15 U.S. Code §§ 77aaa-77bbbb).  The Notes are subject to all such terms, and
Holders are referred to the Indenture and such Act for a statement of such
terms.  To the extent any provision of
this Note conflicts with the express provisions of the Indenture, the
provisions of the Indenture shall govern and be controlling.  The Notes are obligations of the
Company.  The Company is issuing
$225.0 million in aggregate principal amount on the Issue Date and may
issue Additional Notes in accordance with the terms of the Indenture.

 

5.  DENOMINATIONS, TRANSFER, EXCHANGE.  The Notes are in registered form without
coupons in denominations of $1,000 and integral multiples of $1,000.  The transfer of Notes may be registered and
Notes may be exchanged as provided in the Indenture.  The Registrar and the Trustee may require a
Holder, among other things, to furnish appropriate endorsements and transfer
documents and the Company and the Trustee may require a Holder to pay any taxes
and fees required by law or permitted by the Indenture.  Also, the Company need not exchange or
register the transfer of any Notes during the period between a record date and
the corresponding Interest Payment Date.

 

6.  PERSONS DEEMED OWNERS. 
The registered Holder of a Note may be treated as its owner for all
purposes.

 

7.  AMENDMENT, SUPPLEMENT AND WAIVER.  Subject to certain exceptions, the Indenture
or the Notes may be amended or supplemented with the written consent of the
Holders of at least a majority in principal amount of the then outstanding
Notes voting as a single class, and any existing default or compliance with any
provision of the Indenture or the Notes may be waived with the written consent
of the Holders of a majority in principal amount of the then outstanding Notes
voting as a single class.  Without the
consent of any Holder of a Note, the Indenture or the Notes may be amended or
supplemented to cure any ambiguity, defect or inconsistency, to provide for
uncertificated Notes in addition to or in place of certificated Notes, to
provide for the assumption of the Company’s obligations to Holders of the Notes
in case of a merger or consolidation, to make any change that would provide any
additional rights or benefits to the Holders of the Notes or that does not
adversely affect in any material respects the rights under the Indenture of any
such Holder, to comply with the requirements of the SEC in order to effect or
maintain the qualification of the Indenture under the Trust Indenture Act or to
evidence and provide for the acceptance of appointment under the Indenture of a
successor Trustee.

 

8.  DEFAULTS AND REMEDIES. 
Events of Default are set forth in the Indenture.  If any Event of Default occurs and is
continuing, the Trustee or the Holders of at least 25% in principal amount of
the then outstanding Notes may declare all the Notes to be due and
payable.  Notwithstanding the foregoing,
in the case of an Event of Default arising from certain events of bankruptcy or
insolvency, all outstanding Notes will become due and payable without further
action or notice.  Holders may not
enforce the Indenture or the Notes except as provided in the Indenture.  Subject to certain limitations, Holders of a
majority in principal amount of the then outstanding Notes may direct the
Trustee in writing in its

 

4

 

exercise of any trust or power. 
The Trustee may withhold from Holders of the Notes notice of any
continuing Default or Event of Default (except a Default or Event of Default
relating to the payment of principal or interest) if it determines that
withholding notice is in their interest. 
The Holders of a majority in aggregate principal amount of the Notes
then outstanding by written notice to the Trustee may on behalf of the Holders
of all of the Notes waive any existing Default or Event of Default and its
consequences under the Indenture except a continuing Default or Event of
Default in the payment of interest on, or the principal of, the Notes.  The Company is required to deliver to the
Trustee annually a statement regarding compliance with the Indenture, and the
Company is required upon becoming aware of any Default or Event of Default, to
deliver to the Trustee a statement specifying such Default or Event of Default.

 

9.  TRUSTEE DEALINGS WITH COMPANY.  The Trustee, in its individual or any other
capacity, may make loans to, accept deposits from, and perform services for the
Company or its Affiliates, and may otherwise deal with the Company or its
Affiliates, as if it were not the Trustee.

 

10.  NO RECOURSE AGAINST OTHERS. 
A director, officer, employee, incorporator or stockholder, of the
Company, as such, shall not have any liability for any obligations of the
Company under the Notes or the Indenture or for any claim based on, in respect
of, or by reason of, such obligations or their creation.  Each Holder by accepting a Note waives and
releases all such liability.  The waiver
and release are part of the consideration for the issuance of the Notes.

 

11.  AUTHENTICATION.  This
Note shall not be valid until authenticated by the manual signature of the
Trustee or an authenticating agent.

 

12.  ABBREVIATIONS.  Customary
abbreviations may be used in the name of a Holder or an assignee, such as:  TEN COM (= tenants in common), TEN ENT (=
tenants by the entireties), JT TEN (= joint tenants with right of
survivorship and not as tenants in common), CUST (= Custodian), and U/G/M/A (=
Uniform Gifts to Minors Act).

 

13.  CUSIP NUMBERS.  Pursuant
to a recommendation promulgated by the Committee on Uniform Security
Identification Procedures, the Company has caused CUSIP numbers to be printed
on the Notes.  No representation is made
as to the accuracy of such numbers as printed on the Notes and reliance may be
placed only on the other identification numbers placed thereon.

 

5

 

The Company will furnish to any Holder upon written
request and without charge a copy of the Indenture.  Requests may be made to:

 

	
  iStar Financial Inc.

  
	
  1114 Avenue of the
  Americas, 27th Floor

  
	
  New York, NY 10036

  
	
  Attention: Investor
  Relations

  

 

6

 

ASSIGNMENT FORM

 

To assign this Note, fill in the form below:

 

	
  (I) or (we) assign and transfer this Note
  to:

  	
   

  
	
   

  	
  (Insert assignee’s legal name)

  
	
   

  
	
  (Insert assignee’s soc. sec. or tax I.D. no.)

  
	
   

  
	
   

  
	
   

  
	
  (Print or type assignee’s name, address and zip
  code)

  

 

and irrevocably appoint
                                                                                                                                                         to
transfer this Note on the books of the Company. The agent may substitute
another to act for him.

 

	
  Date:

  	
   

  	
   

  	
   

  
	
   

  	
  Your Signature:

  	
   

  	
   

  
	
   

  	
  (Sign exactly as your name appears on

  the face of this Note)

  
	
   

  
	
  Signature Guarantee*: 

  	
   

  	
   

  
								

 

*                                                   Participant
in a recognized Signature Guarantee Medallion Program (or other signature
guarantor acceptable to the Trustee).

 

7

 

SCHEDULE OF EXCHANGES OF INTERESTS IN THE GLOBAL NOTE

 

The following exchanges of a part of this Global Note
for an interest in another Global Note or for a Definitive Note, or exchanges
of a part of another Global Note or Definitive Note for an interest in this
Global Note, have been made:  

 

	
  Date of Exchange

  	
   

  	
  Amount of

  decrease in

  Principal Amount 

  of this Global Note

  	
   

  	
  Amount of

  increase in

  Principal Amount

  of this Global Note

  	
   

  	
  Principal Amount

  of this Global Note

  following such

  decrease

  (or increase)

  	
   

  	
  Signature of

  authorized officer

  of Trustee or Note

  Custodian

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  

 

8

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