Document:

EXHIBIT
4.1

 

[Face of Note]

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

Supplemental Indenture]

 

CUSIP 45031UAR2

 

5.15% Senior Notes
due 2012

 

	
  No.                  

  	
   

  	
  $                      

  

 

iSTAR FINANCIAL
INC.

 

promises to pay to                                                 ,
or registered assigns, the principal sum of                   

 

Dollars on March
1, 2012.

 

Interest Payment
Dates:  March 1 and September 1

 

Record Dates:
February 15 and August 15

 

Dated:  [               ]

 

	
   

  	
  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

  	
   

  	
   

  
						

 

A-1

[Back of Note]

5.15% Senior Notes due 2012

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 5.15% per annum from March 1, 2005 until
maturity.  The company will pay interest
semi-annually in arrears on March 1 and September 1 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 March 1, 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 September 1, 2005.  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 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 accure 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 February 15 or August 15 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 March 1, 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 $700 million in aggregate principal amount on the Issue Date and may
issue Additional Notes in accordance with the terms of the Indenture.

 

A-2

 

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 1, 2012, computed using a discount rate equal to the
Treasury Rate plus 20 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 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.

 

A-3

 

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 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 (=

 

A-4

 

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.

 

A-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

 

A-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).

 

A-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

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  

 

A-8EXHIBIT
4.2

 

[Face of Note]

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

Supplemental Indenture]

 

CUSIP 45031UAQ4

 

Senior Floating
Rate Notes due 2008

 

	
  No.       

  	
   

  	
  $                

  

 

iSTAR FINANCIAL
INC.

 

promises to pay to                                        ,
or registered assigns, the principal sum of                            

 

Dollars on March
3, 2008.

 

Interest Payment
Dates:  March 3, June 3, September 3 and
December 3

 

Record Dates:  February 15, May 15, August 15 and November
15

 

Dated: 
[               ]

 

	
   

  	
  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

  	
   

  
						

 

A-1

 

[Back of Note]

Senior Floating Rate Notes due 2008

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 3, June 3,
September 3 and December 3 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 0.39% 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 March 1, 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 3, 2005.  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.

 

(ii)                With
respect to an interest determination date on which no rate appears on Moneyline
Telerate Page 3750 as of 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

 

A-2

 

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 as of 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 February 15, May 15, August 15 and November 15
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

 

A-3

 

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 March 1, 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
$400 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 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

 

A-4

 

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.

 

A-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

 

A-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).

 

A-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

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  

 

A-8

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