Document:

Exhibit 10.13

 

FORM OF BUSINESS OPPORTUNITY RIGHT OF
FIRST OFFER AGREEMENT

 

THIS BUSINESS OPPORTUNITY RIGHT OF FIRST
OFFER AGREEMENT (this “Agreement”) is made as of    ,
2008, by and among iStar Acquisition Corp., a Delaware corporation (the “Company”),
iStar Financial Inc., a Maryland corporation (“SFI”), Jay Sugarman and Jay
Nydick.

RECITALS

 

WHEREAS,
the Company has filed a registration statement (as amended, the “Registration
Statement”) on Form S-1 (File No. 333-147305) under the
Securities Act of 1933, as amended, with the Securities and Exchange Commission
in connection with an initial public offering (the “IPO”) of 50,000,000
units of the Company (or up to 57,500,000 units if and to the extent that the
underwriters exercise their over-allotment option);

 

WHEREAS,
SFI, directly or through one of its wholly-owned subsidiaries, owns a
significant number of the units of the Company immediately prior to the IPO;

 

WHEREAS,
Jay Sugarman and Jay Nydick are executive officers of both the Company and SFI;
and

 

WHEREAS,
the parties wish to clarify the business opportunities for which each of the
Company and SFI shall have the right of first offer.

 

NOW,
THEREFORE, in consideration of the mutual covenants
and agreements set forth herein, and for other good and valuable consideration,
the receipt and sufficiency of which are hereby acknowledged, the parties
hereto agree as follows:

 

1.             Right
of First Offer.  For the term specified in Section 2 of this
Agreement, the Company and SFI shall agree to share business opportunities as
follows:

 

(a)                                  The
Company shall have a right of first offer with respect to any business
combination opportunity presented to SFI, Jay Sugarman or Jay Nydick with any
managers in the alternative asset management industry, other than managers whose
majority of assets under management consist of real estate investments; and

 

(b)                                 SFI
shall have a right of first offer with respect to any business combination opportunity
to which the Company does not have a right of first offer.

 

In accordance
with the terms of this Agreement, if the Company elects not to pursue a
specific business combination opportunity as to which the Company has a right
of first offer, then SFI will be free to pursue such opportunity. Similarly, if
SFI elects not to pursue a specific business combination opportunity as to
which it has a right of first offer, then the Company will be free to pursue
that opportunity. Notwithstanding anything to the contrary contained in this
Agreement, Oak Hill Advisors, L.P., a manager of debt securities in which SFI
holds a non-controlling interest, shall have no obligations under this
Agreement and shall not be restricted under this Agreement from pursuing any
business combination opportunity.

 

 

For purposes
of this Agreement, the term “business combination opportunity” shall mean an
opportunity to acquire, directly or indirectly, including by merger or other
operation of law, one or more operating businesses, or a portion of such
business or businesses, whose fair market value, individually or collectively,
is equal to at least 80% of the balance in the Company’s trust account
maintained with Continental Stock Transfer & Trust Company (less
deferred underwriting discounts and commissions and taxes payable), all as
contemplated by the Registration Statement.

 

Decisions by the Company not
to pursue any specific business combination opportunity with respect to which
the Company has a right of first offer will be made by a majority of the
disinterested, independent directors of the Company’s board of directors. Decisions
by SFI not to pursue any specific business combination opportunity with respect
to which SFI has a right of first offer will be made by a majority of the disinterested,
independent directors of SFI’s board of directors.

 

Each party hereto
that becomes aware of a business combination opportunity which is subject to
this Agreement shall provide written notice of the business combination opportunity
to the party to whom it has the duty to grant the right of first offer within five
business days of its identification of the business combination opportunity.

 

2.             Term.  This
Agreement shall become effective on its execution and shall remain in effect
for a period to expire upon the earlier of (i) the consummation by the
Company of a business combination opportunity or (ii) the Company’s
liquidation, each in the circumstances and in the manner described in the
Registration Statement.

 

3.             Notices.  All
notices or communications hereunder shall be in writing, addressed as follows:

 

To the Company:

 

iStar Acquisition Corp.

1114 Avenue of the Americas

39th Floor

New York, New York 10036

Attention:  Chief Executive Officer

 

To SFI:

 

iStar Financial Inc.

1114 Avenue of the Americas

39th Floor

New York, New York 10036

Attention:  General Counsel

 

Any such
notice or communication shall be personally served, delivered by reputable
overnight courier service with charges prepaid, or transmitted by hand
delivery, telegram, telex or facsimile, addressed as above (or to such other
address as such party shall have specified most recently by written notice). Notice
shall be deemed given on the date of service or transmission if personally
served or transmitted by telegram, telex or facsimile; provided, however, that if such service or
transmission is not on a business day or is after normal business hours, then
such notice shall be deemed given on the next business day. Notice otherwise
sent as provided herein shall be deemed given on the next business day
following timely delivery of such notice to a reputable overnight courier
service with an order for next-day delivery.

 

2

 

4.             Severability.  If
any provision of this Agreement shall be declared to be invalid or
unenforceable, in whole or in part, such invalidity or unenforceability shall
not affect the remaining provisions hereof which shall remain in full force and
effect.

 

5.             Assignment.  Neither
this Agreement nor any rights or obligations hereunder shall be assignable or
otherwise subject to hypothecation by either party hereto.

 

6.             Amendment.  This
Agreement may only be amended by written agreement of the parties hereto.

 

7.             Governing
Law.  This Agreement shall for all purposes be deemed to be made
under and shall be construed in accordance with the laws of the State of New
York, without giving effect to conflicts of law principles that would result in
the application of the substantive laws of another jurisdiction. The parties
hereto agree that any action, proceeding or claim against it arising out of or
relating in any way to this Agreement shall be brought and enforced in the
courts of the State of New York or the United States District Court for the
Southern District of New York, and irrevocably submit to such jurisdiction,
which jurisdiction shall be exclusive. The parties hereto hereby waive any
objection to such exclusive jurisdiction and that such courts represent an
inconvenient forum.

 

8.             Effect
on Prior Agreements.  This Agreement constitutes the entire
agreement and understanding of the parties hereto in respect of its subject
matter and supersedes in all respects all prior understandings, agreements or
representations by or among the parties hereto, written or oral, to the extent
they relate in any way to the subject matter hereof or the transactions contemplated
hereby.

 

9.             Counterparts.  This Agreement may be executed by facsimile
and in multiple counterparts, and all of which taken together shall constitute
one and the same instrument.

 

10.           Waiver of Jury
Trial.  EACH PARTY HERETO HEREBY IRREVOCABLY AND UNCONDITIONALLY
WAIVES THE RIGHT TO A TRIAL BY JURY IN ANY ACTION, SUIT, OR PROCEEDING BROUGHT
TO ENFORCE OR DEFEND ANY RIGHTS OR REMEDIES UNDER THIS AGREEMENT OR ANY
DOCUMENTS RELATED HERETO.

 

11.           Waiver.  The Company hereby agrees to indemnify the other
parties to this Agreement to the extent permitted by law with respect to any
fiduciary duty claims or similar claims regarding any business combination
opportunities presented to the other parties while such party is a director or
officer of the Company.

 

[Remainder of page intentionally
left blank. Signature pages to follow.]

 

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IN WITNESS
WHEREOF, the parties hereto have executed this Business Opportunity Right of
First Offer Agreement as of the date first specified above.

 

 

	
   

  	
  iSTAR
  ACQUISITION CORP.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
  Title:

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  iSTAR
  FINANCIAL INC.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
  Title:

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  Jay Sugarman

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  Jay Nydick

  

 

4Exhibit
10.16

 

 

Banc of America
Securities LLC

9 West 57th Street

New York, New York 10036

 

Re:                               Initial Public Offering of iStar
Acquisition Corp.

 

Ladies and
Gentlemen:

 

This letter confirms the
agreement of iStar Financial Inc. (“iStar”) to enter into an agreement
or plan (the “Purchase Plan”) in accordance with the guidelines
specified by Rule 10b5-1 under the Securities Exchange Act of 1934, as
amended (the “Exchange Act”), to purchase shares of common stock, par
value $0.0001 per share (the “Common Stock”), of iStar Acquisition Corp.
(the “Company”) included in the units (the “Units”) being sold in
the Company’s initial public offering (the “IPO”) upon the terms and
conditions set forth herein.  Each Unit
is comprised of one share of Common Stock and one warrant (a “Warrant”)
entitling the holder thereof to purchase one share of Common Stock.

 

In connection with the IPO, agrees
that it will enter into the Purchase Plan with Banc of America Securities LLC (“Banc
of America”) pursuant to which iStar will place limit orders for up to $25,000,000
of the Company’s Common Stock (the “Aftermarket Shares”) for a period commencing
two business days after the Company files a preliminary proxy statement
relating to its Business Combination (as defined in the Company’s Amended and
Restated Certificate of Incorporation (as amended from time to time, the “Certificate
of Incorporation”)) and ending on the business day immediately preceding
the record date for the meeting of stockholders at which the Business
Combination is to be voted upon by the Company’s stockholders.  The limit orders will require iStar to
purchase the Aftermarket Shares offered for sale at or below a price equal to
the per-share value of the Trust Fund (as defined in the Certificate of
Incorporation) as reported in the preliminary proxy statement or
the most recent annual report on Form 10-K or quarterly report on Form 10-Q,
as applicable, filed by the Company with the Securities and Exchange Commission
prior to the commencement of the purchase of the Aftermarket Shares.  The purchase of the Aftermarket Shares will
be made by Banc of America or another broker dealer mutually agreed upon by
Banc of America and iStar.  Purchases
pursuant to the Purchase Plan will be conducted in compliance with Rule 10b-18(b) under
the Exchange Act and the broker’s purchase obligation will otherwise be subject
to applicable law, including Regulation M which may prohibit purchases under
certain circumstances.  The Purchase Plan
will obligate the broker promptly to notify iStar of any purchase of
Aftermarket Shares so that iStar can comply with applicable reporting
requirements on a timely basis.

 

In addition, in connection
with the IPO, iStar will enter into a Co-Investment Unit Subscription Agreement
with the Company pursuant to which iStar will agree to purchase and acquire from
the Company such number of Units (the “Co-Investment Units”) as may be
acquired at a price of $10.00 per unit using the remaining portion, if any, of
the $25,000,000 that has not been used by iStar to purchase Aftermarket Shares.

 

In order to induce the
Company and the underwriters to proceed with the IPO, and in recognition of the
benefit that such IPO will confer upon iStar, and for other good and valuable
consideration, the receipt and sufficiency of which are hereby acknowledged, iStar
hereby agrees with the Company as follows:

 

 

1.                                       Approval of Extension Period or Business
Combination or.  iStar agrees that in connection with any vote
of the stockholders of the Company on (i) a proposed amendment to the
Certificate of Incorporation to extend the time period within which the Company
must consummate a Business Combination to up to 30 months or (ii) a
proposed Business Combination, it will vote any Aftermarket Shares or any
shares of Common Stock underlying the Co-Investment Units it has acquired in
favor of such extension or Business Combination and will not exercise
conversion rights (as described in the Certificate of Incorporation) in respect
of any such Aftermarket Shares or shares of Common Stock underlying the
Co-Investment Units.  iStar further
agrees that it will vote any Aftermarket Shares or shares of Common Stock
underlying the Co-Investment Units in favor of an amendment to the Certificate
of Incorporation providing for the Company’s perpetual existence following the
consummation of the Business Combination.

 

2.                                       Transfer Restrictions.  (a) iStar
will not assign, alienate, pledge, attach, sell or otherwise transfer or
encumber (each, a “transfer”), directly or indirectly, any Aftermarket
Shares, any Co-Investment Units or any shares of Common Stock or Warrants
included in the Co-Investment Units (including the Common Stock issuable upon
exercise of the Warrants) until one year following the date of the consummation
of a Business Combination, except to a Permitted Transferee.  Any transfers of such securities to a
Permitted Transferee will be made in accordance with applicable securities laws.  Any transfer of securities to a Permitted
Transferee will be subject to the condition that the Permitted Transferee has
agreed in writing to be bound by the terms of Paragraphs 1 and 2 hereof.

 

“Permitted Transferee”
means (i) an affiliate of iStar; (ii) a charitable organization; (iii) an
individual or entity by virtue of the laws of distribution upon dissolution of iStar;
(iv) a current or former officer, director or employee of iStar; (v) an
officer or director of the Company; or (vi) a corporation, partnership,
limited liability company or other organization, in the event of a merger,
capital stock exchange, stock purchase, asset acquisition or other similar
transaction which results in all of the Company’s stockholders having the right
to exchange their shares of Common Stock for cash, securities or other property
subsequent to the Company’s consummating a Business Combination (as defined in
the Certificate of Incorporation).

 

This letter agreement shall
be binding on iStar and its successors and assigns.  This letter agreement shall terminate on the
earlier of (i) the consummation of a Business Combination and (ii) the
liquidation of the Company; provided
that such termination shall not relieve iStar from liability for any breach of
this letter agreement prior to its termination.

 

This letter agreement
constitutes the entire agreement and understanding between the parties with
respect to the subject matter hereof and supersedes all prior agreements and
understandings (whether written or oral) between the parties relating to such subject
matter. None of the parties shall be liable or bound to any other party in any
manner by any representations and warranties or covenants relating to such
subject matter except as specifically set forth herein.

 

This letter agreement shall
be governed by and construed in accordance with the laws of the State of New
York, without regard to the principles of conflicts of laws thereof.

 

No term or provision of this
letter agreement may be amended, changed, waived, altered or modified except by
written instrument executed and delivered by the party against whom such
amendment, change, waiver, alteration or modification is to be enforced.

 

2

 

	
   

  	
  iSTAR FINANCIAL
  INC.

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
  Title:

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  ACCEPTED AND
  AGREED:

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  iSTAR
  ACQUISITION CORP.

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
  Title:

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  ACCEPTED AND
  AGREED:

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  BANC OF AMERICA
  SECURITIES LLC

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
  Title:

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