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                                                                   EXHIBIT 10.20

                                                                  EXECUTION COPY

                              EMPLOYMENT AGREEMENT

     THIS AGREEMENT entered into as of November 1, 2002 by and between iStar
Financial Inc., a Maryland corporation (together with its successors and
assigns, the "Company"), and Catherine D. Rice (the "Executive").

                                  WITNESSETH :

     WHEREAS, the Company wishes to offer employment to the Executive, and the
Executive desires to accept such offer, on the terms and conditions set forth
below;

     NOW, THEREFORE, IT IS AGREED by and between the Company and the Executive
(the "Parties") as follows:

     1. EMPLOYMENT PERIOD. The Company agrees to employ the Executive, and the
Executive agrees to such employment on the terms and conditions set forth in
this Agreement. The term of the Executive's employment under this Agreement
shall be deemed to have commenced as of November 6, 2002 (the "Effective Date")
and, unless earlier terminated in accordance with Section 5, shall continue
through December 31, 2005 (the "Initial Employment Period"); provided, however,
that the Effective Date shall not be deemed to have occurred unless and until
the parties execute and deliver the agreements contemplated by Section 4 hereof.
Upon the expiration of the Initial Employment Period and upon each anniversary
thereof, the term of Executive's employment hereunder, if not previously ended,
shall automatically be extended for an additional employment period of one year,
subject to earlier termination in accordance with Section 5 (collectively, the
"Additional Employment Period"), unless either Party shall have given written
notice to the other Party of its decision not to extend the Initial Employment
Period or to further extend the Additional Employment Period at least 30 days
prior to the scheduled expiration of the Initial Employment Period or the
Additional Employment Period, as the case may be. (the period during which the
Executive is employed hereunder being hereinafter referred to as the "Term").

     2. POSITION AND DUTIES.

          (a) The Executive shall become an employee of the Company as of the
Effective Date and shall serve as Chief Financial Officer of the Company
beginning on November 16, 2002 and during the remainder of the Term. The
Executive shall have the authorities, duties and responsibilities that are
customarily assigned to the chief financial officer of a company of the size and
nature of the Company, including, but not limited to, raising capital;
financial, accounting, treasury and investor relations functions; financial
reporting; communicating with external parties (including, but not limited to,
shareholders, bondholders and research analysts); and reporting to the Audit
Committee. The Executive agrees that upon the termination of her employment as
Chief Financial Officer of the Company, she shall promptly execute any documents
evidencing such termination that the Company may reasonably request her to
execute.

          (b) In her capacity as Chief Financial Officer of the Company, the
Executive shall report directly to the President of the Company. In the event
the President position is unfilled, the Executive shall report to the Chief
Executive Officer of the Company.

          (c) During the Term, Executive shall devote substantially all of her
business time and attention to the business and affairs of the Company and shall
perform, faithfully and diligently, her duties

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and responsibilities hereunder. It shall not be considered a violation of the
foregoing for the Executive to: (i) serve on corporate, industry, civic, social
or charitable boards or committees or engage in charitable activities and
community affairs, provided that the Chief Executive Officer approves
Executive's service on any such corporate or industry boards or committees; or
(ii) manage her own personal investments and affairs; provided that the
foregoing activities do not materially interfere with the performance of the
Executive's responsibilities hereunder.

          (d) The Executive agrees to discharge her duties and obligations under
this Agreement in accordance with such reasonable policies, consistent with the
express terms of this Agreement, as the Company may from time to time (either
before or after the Effective Date) adopt and communicate to the Executive.

          (e) During the Term, the Executive's principal office, and principal
place of employment, shall be at the Company's principal executive offices in
Manhattan.

     3. COMPENSATION.

          (a) BASE SALARY. During the Term, Executive shall receive a base
salary ("Base Salary") at a rate of $225,000 per annum, subject to annual review
for upward (but not downward) adjustment by the Company's Board of Directors
(the "Board"), or its Compensation Committee (the "Compensation Committee"), in
their sole discretion. The Base Salary shall be paid in accordance with the
Company's customary payroll practices for its senior executives.

          (b) ANNUAL BONUS. Executive shall, to the extent provided in this
Section 3(b), be entitled to receive an annual cash incentive award in respect
of each fiscal year of the Company that ends during the Term, beginning with the
fiscal year ending December 31, 2003. Beginning with the bonus for the fiscal
year ending December 31, 2003, the Executive's annual incentive award target for
any such year shall be $325,000, subject to annual review for upward or downward
adjustment. Such Annual Bonus shall be payable in cash to the Executive on or
about January 31 of the year following the last day of the fiscal year to which
the bonus relates.

          (c) FRINGE BENEFITS.

                (i)     REIMBURSEMENT OF EXPENSES. The Company shall promptly
pay or reimburse Executive in accordance with the Company's standard policies as
in effect from time to time, upon the presentation of appropriate documentation
of such expenses, for all reasonable travel and other expenses incurred by the
Executive in the course of performing services for or on behalf of the Company.

                (ii)    PARTICIPATION IN BENEFIT PLANS. The Executive shall be
entitled to participate, during the Term, in all welfare and retirement benefit
plans, programs and arrangements that are generally available to senior
executives of the Company, including but not limited to qualified and
non-qualified pension and retirement plans, supplemental pension and retirement
plans, group hospitalization, health, medical, vision, dental care, death
benefit, disability, and post-retirement welfare plans, and other present and
future welfare and retirement benefit plans, programs and arrangements, on no
less favorable terms than those that apply to other senior executives of the
Company generally. For avoidance of doubt, the foregoing shall not be construed
as a guaranty of, or as an obligation on the part of the Company to provide, any
future awards (including, but not limited to, stock options, restricted stock,
phantom shares, or other performance awards) under any Company incentive plan
from time to time in effect for its senior executives or other employees.

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                (iii)   VACATION. During the Term, Executive shall be entitled
to four weeks' paid vacation per annum. Executive shall not be entitled to any
cash payment in respect of any unused vacation time.

                (iv)    OTHER FRINGE BENEFITS AND PERQUISITES. During the Term,
the Executive shall be entitled to participate in all fringe benefits and
perquisites available to senior executives of the Company generally at levels,
and on terms and conditions, that are commensurate with her position and
responsibilities at the Company and shall be entitled to receive such additional
fringe benefits and perquisites as the Company may, in its discretion, from time
to time provide.

                (v)     RELOCATION; CORPORATE APARTMENT. The Company shall
reimburse the Executive for relocation expenses in accordance with the Company's
relocation policy, as in effect from time to time. Reimbursable relocation
expenses will include reasonable travel costs between New York City and San
Francisco related to the Executive's relocation. Commencing on the Effective
Date through December 31, 2002, the Executive shall have use of the Company's
corporate apartment in Manhattan. Thereafter, the Executive shall be permitted
to use such apartment consistent with Company policies.

     4. EQUITY-BASED COMPENSATION; HIGH PERFORMANCE UNITS. It is acknowledged
that, commencing herewith, the Executive is being granted certain equity-based
compensation in accordance with and subject to the terms of two award
agreements, copies of which are attached hereto as Exhibit A and Exhibit B. In
addition, the Executive is purchasing interests in each of the Company's 2003,
2004, 2005 and 2006 High Performance Unit Plans pursuant to a subscription
agreement, a copy of which is attached hereto as Exhibit C. The Executive is
hereby granted the right to purchase interests representing 12.5% of the total
interests in the Company's 2007 High Performance Unit Plan; provided, however,
that in the event such 2007 High Performance Unit Plan is required to be
approved by the Company's shareholders, and, after submission to the
shareholders, the Plan is not approved, then this right shall terminate with no
liability on the part of the Company or the Executive. The purchase price for
interests in the 2007 High Performance Unit Plan shall be the fair market value
for such interests as determined by the Company, subject to review by its
independent auditors.

     5. TERMINATION OF EMPLOYMENT.

          (a) DEATH OR DISABILITY. The Executive's employment with the Company
shall terminate automatically upon the Executive's death. To the extent
permitted by applicable law, the Company shall be entitled to terminate the
Executive's employment with the Company in the event of the Executive's
Disability. "Disability" shall mean that the Executive shall have been unable,
for a period of not less than six consecutive months, to substantially perform
her duties for the Company, as a result of physical or mental illness, injury or
impairment.

          (b) BY THE COMPANY.

                (i)     The Company may terminate the Executive's employment
with the Company for Cause or Without Cause. "Cause" shall mean (i) the
conviction of the Executive (including a guilty or NOLO CONTENDERE plea) for the
commission of any felony; (ii) the Executive's engagement in fraud or
embezzlement or intentional misappropriation of the Company's funds or other
assets of the Company; (iii) willful engagement by the Executive in significant
activities resulting in material and demonstrable harm to the reputation of the
Company; (iv) the willful and repeated refusal to perform or substantial
disregard of the duties properly assigned to the Executive by the Company (other
than as a result of Disability); (v) a material violation by the Executive of
any statutory or common law duty of loyalty to the Company; or (vi) a material
breach by the Executive of this Agreement or the Company's Code of Conduct.
Notwithstanding the foregoing, (i) the Executive shall be given written notice
of any

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action or failure to act that is alleged to constitute Cause (a "Default"), and
an opportunity for 20 business days from the date of such notice to cure such
Default, such period to be subject to extension in the discretion of the CEO or
the Board of Directors; and (ii) regardless of whether the Executive is able to
cure any Default, the Executive shall not be deemed to have been terminated for
Cause without (x) an opportunity for the Executive, together with her counsel,
to be heard by the Board of Directors, and (y) following any such hearing by the
Board of Directors, delivery to the Executive of a notice of termination stating
that the Company has determined that the actions or inactions of the Executive
described in the Company's prior notice of Default constitute Cause.

                (ii)    A termination of the Executive's employment by the
Company "Without Cause" (that is, neither for Cause nor for death, nor
Disability, in each case as determined in accordance with this Agreement) shall
be effected by the Company giving the Executive prior written notice of the
termination, which notice shall specify the Date of Termination (as defined
below). A termination of Executive's employment Without Cause by the Company
shall not constitute a breach of this Agreement.

          (c) BY THE EXECUTIVE.

                (i)     The Executive may terminate her employment hereunder for
Good Reason or without Good Reason. "Good Reason" means any of the following
that is not cured within 30 calendar days following written notice thereof from
the Executive to the Company:

                        (A)  failure by the Company to maintain the Executive as
                CFO of the Company with such duties as are described in Section
                2(a);

                        (B)  the assignment to the Executive of any duties or
                responsibilities inconsistent in any respect with those
                customarily associated with the position to be held by Executive
                pursuant to this Agreement or any diminution in Executive's
                position, authority, duties or responsibilities in a manner
                inconsistent with the terms and provisions of this Agreement;

                        (C)  any requirement that the Executive's services
                hereunder be rendered primarily at a location or locations other
                than the offices of the Company located in the borough of
                Manhattan in New York City and in San Francisco, California;

                        (D)  the failure of any successor to all or
                substantially all of the assets or business of the Company to
                promptly assume in writing all of the obligations of the Company
                under this Agreement; or

                        (E)  any other material breach of this Agreement by the
                Company.

                (ii)    A termination of employment by the Executive (including
a termination for Good Reason), other than for death or Disability, in each case
determined in accordance with this Agreement, and not by notice of non-extension
in accordance with Section 1, shall be effected by her giving the Company prior
written notice, no less than 30 days before the Date of Termination, specifying
the Date of Termination. Termination of the Executive's employment in accordance
with this Section 5(c)(ii) shall not constitute a breach of this Agreement.

          (d) NO WAIVER. The failure to set forth any fact or circumstance shall
not constitute a waiver of the right to assert, and shall not preclude the Party
giving notice from asserting, such fact or circumstance in an attempt to enforce
any right under, or in connection with, this Agreement.

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          (e) DATE OF TERMINATION. "Date of Termination" means the date of the
Executive's death, the date on which the termination of the Executive's
employment with the Company by the Company on account of Disability is effected,
the date on which the termination of the Executive's employment with the Company
by the Company for Cause or Without Cause is effective, the date on which the
termination of the Executive's employment for Good Reason is effective, or the
date on which the Executive terminates her employment without Good Reason.

     6. OBLIGATIONS OF THE COMPANY UPON TERMINATION.

          (a) DEATH. In the event that the Executive's employment hereunder is
terminated by the Executive's death, then:

                (i)     the Executive's estate or beneficiaries shall be
entitled to receive any Base Salary and other benefits earned and accrued under
this Agreement prior to the Date of Termination (and reimbursement under this
Agreement for expenses incurred prior to the Date of Termination); and

                (ii)    the Executive shall receive such additional rights and
benefits as may be provided under the benefit plans and programs of the Company
and its affiliates in accordance with the provisions of such plans and programs,
if any; and

                (iii)   the Executive's estate and beneficiaries shall have no
further rights to any other compensation or benefits hereunder on or after the
termination of employment, or any other rights hereunder, except as may
otherwise be provided under the agreements described in Section 4 of this
Agreement.

          (b) DISABILITY. In the event that the Executive's employment hereunder
is terminated for Disability in accordance with this Agreement, then:

                (i)     the Executive or her legal representative, as the case
may be, shall be entitled to receive any Base Salary and other benefits earned
and accrued under this Agreement prior to the Date of Termination (and
reimbursement under this Agreement for expenses incurred prior to the Date of
Termination);

                (ii)    the Executive shall receive Company-paid, continued
medical insurance coverage, as then provided generally to employees of the
Company and their eligible dependents, for the Executive and her eligible
dependents for a period of one year following the Date of Termination; which
coverage shall be included as part of any required COBRA coverage; provided,
however, that the COBRA coverage shall terminate with respect to the Executive
and her eligible dependents as of the earliest date allowed by law;

                (iii)   the Executive shall receive such additional rights and
benefits as may be provided under the benefit plans and programs of the Company
and its affiliates in accordance with the provisions of such plans and programs,
if any; and

                (iv)    the Executive shall have no further rights to any other
compensation or benefits hereunder on or after the termination of employment, or
any other rights hereunder, except as may otherwise be provided under the
agreements described in Section 4 of this Agreement.

          (c) WITHOUT CAUSE BY THE COMPANY OR FOR GOOD REASON BY THE EXECUTIVE.
In the event that the Executive's employment hereunder is terminated Without
Cause by the Company or for Good Reason by the Executive, in each case in
accordance with this Agreement, then:

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                (i)     the Executive shall be entitled to receive any Base
Salary and other benefits earned and accrued under this Agreement prior to the
Date of Termination (and reimbursement under this Agreement for expenses
incurred prior to the Date of Termination);

                (ii)    the Executive shall continue to receive Base Salary at
the then-current rate for 12 months, payable at such times as the Base Salary
would otherwise be payable without regard to such termination;

                (iii)   the Executive shall receive Company-paid, continued
medical insurance coverage, as then provided generally to employees of the
Company and their eligible dependents, for the Executive and her eligible
dependents for a period of one year following the Date of Termination; which
coverage shall be included as part of any required COBRA coverage; provided,
however, that the COBRA coverage shall terminate with respect to the Executive
and her eligible dependents as of the earliest date allowed by law;

                (iv)    the Executive shall receive such additional rights and
benefits as may be provided under the benefit plans and programs of the Company
and its affiliates in accordance with the provisions of such plans and programs,
if any; and

                (v)     the Executive shall have no further rights to any other
compensation or benefits hereunder on or after the termination of employment, or
any other rights hereunder, except as may otherwise be provided under the
agreements described in Section 4 of this Agreement.

          (d) FOR CAUSE BY THE COMPANY, OR BY THE EXECUTIVE WITHOUT GOOD REASON;
BY EXPIRATION OF THE TERM. In the event that the Executive's employment
hereunder is terminated (i) by the Company for Cause in accordance with this
Agreement, (ii) by the Executive without Good Reason, or (iii) upon the
scheduled expiration of the Initial Employment Period or any Additional
Employment Period in accordance with Section 1, then Executive shall be entitled
solely to the following benefits:

                (i)     the Executive shall be entitled to receive any Base
Salary and other benefits earned and accrued under this Agreement prior to the
Date of Termination (and reimbursement under this Agreement for expenses
incurred prior to the Date of Termination), and

                (ii)    the Executive shall have no further rights to any other
compensation or benefits hereunder on or after the termination of employment, or
any other rights hereunder.

          (e) GENERAL RELEASE. The Company's obligation to make any payment
pursuant to Section 6(c)(ii) shall be contingent upon, and is the consideration
for, the Executive executing and delivering to the Company, a general release
(the "Release"), in customary form, releasing the Company, its affiliates and
all current and former members, officers and employees of the Company (the
"Releasees") from any claims relating to her employment hereunder, other than
claims relating to continuing obligations under, or preserved by, (x) this
Agreement or (y) any compensation or benefit plan, program or arrangement in
which the Executive was participating as of the Date of Termination, and no such
amounts shall be provided until the Executive executes and delivers to the
Company a letter which provides that the Executive had not revoked such Release
after seven days following the date of the Release; subject to no Releasee
initiating or maintaining any proceeding or claim against the Executive or any
of her heirs, beneficiaries or legal representatives or against her estate,
other than proceedings and claims relating solely to enforcing the Executive's
continuing obligations under this Agreement or any of the agreements, plans,
programs and arrangements referred to in clause (y) of this Section Section
6(e).

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          (f) NO OFFSET, ETC.. The Company's obligation to make the payments
provided for in, and otherwise to perform its obligations under, this Agreement
shall not be affected by any set-off, counterclaim, recoupment, defense or other
claim, right or action that the Company or any Releasee may have against the
Executive or others. In no event shall the Executive be obligated to seek other
employment or take any other action by way of mitigation of the amount payable
to the Executive under any of the provisions of this Agreement, and such amounts
shall not be reduced, regardless of whether the Executive obtains other
employment or receives benefits or compensation in connection therewith. Amounts
due under this Section 6 are considered to be reasonable by the Company and are
not in the nature of a penalty. The payments and benefits provided for in this
Section 6 are intended to constitute both liquidated damages and, in the case of
the payment described in Section 6(c)(ii), consideration for the general release
described in Section 6(e).

     7. WITHHOLDING. Notwithstanding any other provision of this Agreement, the
Company may withhold from amounts payable under this Agreement all Federal,
state, local and foreign taxes that it determines are required to be withheld by
applicable law or regulation.

     8. CONFIDENTIAL INFORMATION.

          (a) The Executive shall hold all secret or confidential information,
knowledge or data relating to the Company or any of its affiliates and their
respective businesses that the Executive obtains during her employment hereunder
and that is not public knowledge (other than as a result of the Executive's
violation of this Section 8) ("Confidential Information") in strict confidence.
The Executive shall not communicate, divulge or disseminate Confidential
Information at any time during or after the Executive's employment with the
Company, except (i) in the course of performing her duties for the Company or
its affiliates, (ii) in confidence to any attorney, accountant or other
professional for the purpose of securing professional advice, (iii) to the
extent reasonably necessary to enforce her rights, (iv) with the prior written
consent of the Company or (v) as otherwise required by law, regulation or legal
process. If the Executive is requested pursuant to, or required by, applicable
law, regulation or legal process to disclose any Confidential Information, the
Executive shall provide the Company, as promptly as the circumstances reasonably
permit, with notice of such request or requirement and, unless a protective
order or other appropriate relief is previously obtained, the Confidential
Information subject to such request may be disclosed pursuant to and in
accordance with the terms of such request or requirement, provided that the
Executive shall use her best reasonable efforts, at the Company's reasonable
request and sole expense, to limit any such disclosure to the precise terms of
such request or requirement.

          (b) All memoranda, notes, lists, records, property and any other
tangible product and documents (and all copies thereof), whether visually
perceptible, machine-readable or otherwise, made, produced or compiled by the
Executive or made available to the Executive concerning the business of the
Company or its affiliates, (i) shall at all times be the property of the Company
(and, as applicable, any affiliates) and shall be delivered to the Company at
any time upon its request, and (ii) upon the Executive's termination of
employment, shall be immediately returned to the Company.

     9. NON-COMPETITION/NON-SOLICITATION. The Executive acknowledges that the
services to be rendered by her to the Company (which, as used in this Section 9,
shall be deemed to include the Company and each of its Subsidiaries) are of a
special and unique character. In consideration of her employment hereunder, the
Executive agrees, for the benefit of the Company, that she will not (other than
in connection with performing her duties for the Company or its affiliates):

          (a) during the Term and, if the Executive's employment hereunder is
terminated (x) by the Company for any reason other than a termination Without
Cause or (y) by the Executive other than for

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Good Reason, for 12 months thereafter: (i) engage, directly or indirectly,
whether as principal, agent, representative, consultant, employee, partner,
stockholder, limited partner or other investor (other than an investment of not
more than (x) 5% of the stock or equity of any corporation the capital stock of
which is publicly traded or (y) 5% of the ownership interest of any limited
partnership or other entity) or otherwise, within the United States of America,
in any business that competes directly or materially with the business conducted
by the Company as of the Date of Termination or (ii) solicit or entice, or
attempt to solicit or entice, away from the Company, either for her own account
or for any individual, firm or corporation, any person known by her to have
been, at any time during the 12 months prior to such solicitation, enticement or
attempt, a borrower from, a lender to, or a direct and material participant in a
substantial financial transaction with, the Company, or to have been actively
solicited by the Company to become a borrower from, a lender to, or a direct and
material participant in a substantial financial transaction with, the Company;
or

          (b) during the Term and for 12 months thereafter: (i) solicit or
entice, or attempt to solicit or entice, away from the Company any individual
who is known by the Executive to then be an officer or employee of the Company
either for her own account or for any individual, firm or corporation, whether
or not such individual would commit a breach of a contract of employment by
reason of leaving the service of the Company or (ii) employ, directly or
indirectly, any person who has been, during the 12 months prior to employment by
the Executive, an officer, employee or sales representative of the Company.

          (c) The Executive understands that the provisions of this Section 9
may limit her ability to earn a livelihood in a business similar to the business
of the Company but nevertheless agrees and hereby acknowledges that (A) such
provisions do not impose a greater restraint than is necessary to protect the
goodwill or other business interests of the Company, (B) such provisions contain
reasonable limitations as to time and scope of activity to be restrained, (C)
such provisions are not harmful to the general public, (D) such provisions are
not unduly burdensome to the Executive, and (E) the consideration provided
hereunder is sufficient to compensate the Executive for the restrictions
contained in such provisions. In consideration thereof and in light of the
Executive's education, skills and abilities, the Executive agrees that the
Executive will not assert in any forum that such provisions prevent the
Executive from earning a living or otherwise are void or unenforceable or should
be held void or unenforceable.

          (d)   Notwithstanding anything herein to the contrary, the Executive
shall not be restricted from engaging in a non-competing business pursuant to
Section 9(a) even if another division, subsidiary or affiliate of that
enterprise does compete with the Company, so long as she does not perform any
services for such division, subsidiary or affiliate.

     10. RIGHTS AND REMEDIES UPON BREACH OF SECTION 8 OR 9.

          (a) The Executive acknowledges and agrees that any breach by her of
any of the provisions of Sections 8 or 9 (the "Restrictive Covenants") would
result in irreparable injury and damage for which money damages would not
provide an adequate remedy. Therefore, if the Executive breaches, or threatens
to commit a breach of, any of the provisions of Section 8 or Section 9, the
Company and its affiliates shall have the following rights and remedies, each of
which rights and remedies shall be independent of the other and severally
enforceable, and all of which rights and remedies shall be in addition to, and
not in lieu of, any other rights and remedies available to the Company and its
affiliates under law or in equity (including, without limitation, the recovery
of damages);

                (i)     The right and remedy to have the Restrictive Covenants
specifically enforced (without posting bond and without the need to prove
damages) by any court having equity

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jurisdiction, including, without limitation, the right to an entry against the
Executive of restraining orders and injunctions (preliminary, mandatory,
temporary and permanent) against violations, threatened or actual, and whether
or not then continuing, of such covenants.

                (ii)    The right and remedy to require the Executive to account
for and pay over to the Company and its affiliates all compensation, profits,
monies, accruals, increments or other benefits (collectively, "Benefits")
derived or received by her as the result of any transactions constituting a
breach of the Restrictive Covenants, and the Executive shall account for and pay
over such Benefits to the Company and, if applicable, its affected affiliates.

          (b) The Executive agrees that in any action seeking specific
performance or other equitable relief, she will not assert or contend that any
of the provisions of Sections 8 or 9 are unreasonable or otherwise
unenforceable. The existence of any claim or cause of action by the Executive,
whether predicated on this Agreement or otherwise, shall not constitute a
defense to the enforcement of the Restrictive Covenants.

     11. ARBITRATION. Any claim or dispute arising out of or relating to this
Agreement (other than a controversy or claim arising under Section 8 or Section
9, to the extent necessary for the Company (or its affiliates, where applicable)
to avail itself of the rights and remedies referred to in Section 10), any other
agreement between the Executive and the Company or any of its affiliates, the
Executive's employment with the Company or the termination thereof
(collectively, "Covered Claims") shall be resolved by binding arbitration, to be
held in the Borough of Manhattan, in accordance with the Commercial Arbitration
Rules (and not the National Rules for the Resolution of Employment Disputes) of
the American Arbitration Association and this Section 11. Judgment upon the
award rendered by the arbitrator(s) may be entered in any court having
jurisdiction thereof.

     12. SUCCESSORS; BENEFICIARIES.

          (a) This Agreement is personal to the Executive and, without the prior
written consent of the Company, shall not be assignable by the Executive;
provided, however, that any of the Executive's rights to compensation hereunder
may be transferred by will or by the laws of descent and distribution or as
provided in Section 12(d).

          (b) This Agreement shall inure to the benefit of and be binding upon
the Parties and their respective successors, heirs (in the case of the
Executive) and assigns.

          (c) No rights of the Company under this Agreement may be assigned or
transferred by the Company, other than to a successor (whether direct or
indirect, by purchase, merger, consolidation or otherwise) to all or
substantially all of the business or assets of the Company that promptly and
expressly agrees to assume and perform this Agreement in the same manner and to
the same extent that the Company would have been required to perform it if no
such succession had taken place. As used in this Agreement, the term "Board"
shall include both the "Board" as defined in the first sentence of Section 2(b)
and the board of directors, board of trustees, or analogous governing person or
body of any successor to all or substantially all of the business or assets of
the Company.

          (d) The Executive shall be entitled, to the extent permitted under any
applicable law, any applicable plans, programs and arrangements of the Company,
to select and change the beneficiary or beneficiaries to receive any
compensation or benefit payable hereunder following the Executive's death by
giving the Company written notice thereof. In the event of the Executive's death
or a judicial determination of her incompetence, references in this Agreement to
the Executive shall be deemed, where appropriate, to refer to her beneficiary,
estate or other legal representative.

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          (e) Except to the extent otherwise provided in Sections 12(a) and
12(d), the rights and benefits of the Executive under this Agreement may not be
anticipated, assigned, alienated or subjected to attachment, garnishment, levy,
execution or other legal or equitable process. Any attempt by the Executive to
anticipate, alienate, assign, sell, transfer, pledge, encumber or charge such
rights or benefits, except as required by law or court order or as provided in
Sections 12(a) and 12(d), shall be void. Payments hereunder shall not be
considered assets of the Executive in the event of insolvency or bankruptcy
unless and until paid, or due to be paid, to the Executive.

     13. REPRESENTATIONS. The Executive represents to the Company that she is
not subject or a party to any employment or consulting agreement,
non-competition covenant or other agreement, covenant or understanding which
might prohibit her from executing this Agreement or limit her ability to fulfill
her responsibilities hereunder.

     14. INDEMNIFICATION OF EXECUTIVE. To the extent permitted under applicable
law, the Company agrees that if the Executive is made a party, or is threatened
to be made a party, to any threatened, pending or completed action, suit or
proceeding, whether civil, criminal, administrative or investigative (a
"Proceeding"), by reason of the fact that she is or was a director, officer or
employee of the Company or is or was serving at the request of the Company as a
director, officer, member, employee or agent of another Company, partnership,
joint venture, trust or other enterprise, including service with respect to
employee benefit plans, whether or not the basis of such Proceeding is the
Executive's alleged action in an official capacity while serving as a director,
officer, member, employee or agent, the Executive shall be indemnified and held
harmless by the Company to the fullest extent permitted or authorized by the
Company's certificate of incorporation or bylaws or, if greater, by the laws of
the State of Maryland, against all costs, expenses, liabilities and losses
(including, without limitation, attorney's fees, judgments, fines, ERISA excise
taxes or penalties and amounts paid or to be paid in settlement) reasonably
incurred or suffered by the Executive in connection therewith (including,
without limitation, investigating, preparing for and defending any such
Proceeding), and such indemnification shall continue as to the Executive even if
she has ceased to be a director, officer, member, employee or agent of the
Company or other entity and shall inure to the benefit of the Executive's heirs,
executors and administrators. To the extent permitted by law, the Company shall
advance to the Executive all reasonable costs and expenses incurred by her in
connection with a Proceeding within 20 days after receipt by the Company of a
written request for such advance. Such request shall include an undertaking by
the Executive to repay the amount of such advance if it shall ultimately be
determined that she is not entitled to be indemnified against such costs and
expenses. Without in any way limiting the foregoing or the scope or generality
thereof, to the extent permitted by law, the Company agrees to indemnify and
hold harmless the Executive to the fullest extent permitted or authorized by the
Company's certificate of incorporation or bylaws or, if greater, by the laws of
the State of Maryland, against all costs, expenses, liabilities and losses
reasonably incurred or suffered by the Executive by reason of, arising from or
relating to any written statement of the Executive that (1) is required to be,
and is, filed with the Securities and Exchange Commission regarding the accuracy
of reports or statements filed by the Company with such Commission pursuant to
Federal securities laws or (2) is made to another officer or executive of the
Company to support such a required filed statement of such other officer or
executive, PROVIDED that, in making (and, if applicable, filing) such written
statement, the Executive acted in good faith and in a manner the Executive
reasonably believed to be in and not opposed to the best interests of the
Company, and, with respect to any criminal action or proceeding, had no
reasonable cause to believe that the Executive's conduct was unlawful. The
indemnification provided for in this Section shall not extend to any claims or
disputes arising between the Executive and the Company under, pursuant to, or
with respect to, this Agreement or the agreements referred to in Section 4.

                                       10
<Page>

     15. MISCELLANEOUS.

          (a) This Agreement shall be governed, construed, performed and
enforced in accordance with its express terms, and otherwise in accordance with
the laws of the State of New York, without reference to principles of conflict
of laws. No provision of this Agreement may be amended or modified except by a
written agreement that is executed by the Parties or their respective successors
and legal representatives and that expressly refers to the provision(s) of this
Agreement that are being amended or modified. In the event of any inconsistency
between any provision of this Agreement and any provision of any plan, employee
handbook, personnel manual, program, policy, arrangement or agreement of the
Company or any of its affiliates, the provisions of this Agreement shall control
unless the Executive otherwise agrees in a writing that expressly refers to the
provision of this Agreement whose control she is waiving.

          (b) All notices, requests, consents and other communications under
this Agreement shall be in writing and shall be given (i) by hand delivery or
(ii) by registered or certified mail, return receipt requested, postage prepaid,
addressed as follows or (iii) by nationally recognized overnight courier,
addressed as follows:

          IF TO EXECUTIVE:

          Catherine D. Rice
          c/o iStar Financial Inc.
          1114 Avenue of the Americas, 27th Floor
          New York, NY 10036

          with a copy to the Executive at the address of her primary residence
          as it then appears in the records of the Company and a copy to:

          Gibson, Dunn & Crutcher LLP
          200 Park Avenue
          New York, NY  10166-0193
          Attn: Charles F. Feldman, Esq.

          IF TO THE COMPANY:

          iStar Financial Inc.
          1114 Avenue of the Americas, 27th Floor
          New York, NY 10036
          Attn: General Counsel

          with copy each to:

          iStar Financial Inc.
          1114 Avenue of the Americas, 27th Floor
          New York, NY  10036
          Attn: Chairman, Compensation Committee of the Board of Directors

                                       11
<Page>

          and

          Clifford Chance US LLP
          200 Park Avenue
          New York, NY 10166-0513
          Attn: Kathleen L. Werner, Esq.

or to such other address or addresses as either Party furnishes to the other in
writing in accordance with this Section 15(b). Notices and other communications
shall be effective when actually received by the addressee.

          (c) If any provision of this Agreement, including but not limited to
Section 8, 9 or 10 or the application of any such provision to any person or
circumstances shall be determined by any court or arbitrator of competent
jurisdiction to be invalid or unenforceable to any extent, then (i) the
remainder of this Agreement, and the application of such provision to such
person or circumstances other than those to which it is so determined to be
invalid or unenforceable, shall not be affected thereby, and each provision
hereof shall be enforced to the fullest extent permitted by law and (ii) such
court or arbitrator shall have the power, and is hereby directed, to reduce the
scope, duration or area of the provision, to delete specific words or phrases
and to replace any invalid or unenforceable provision with a provision that is
valid and enforceable and that comes closest to expressing the intention of the
invalid or unenforceable provision, and this Agreement shall be enforced as so
modified.

          (d) Anything contained in this Agreement to the contrary
notwithstanding, the provisions of Sections 7 through 11, and the other
provisions of this Agreement to the extent necessary to effectuate the survival
of Sections 7 through 11, shall survive termination of this Agreement and any
termination of the Executive's employment hereunder.

          (e) The Company agrees to reimburse the Executive for legal fees
incurred by her in connection with the negotiation and execution of this
Agreement, up to a maximum amount of $10,000.00.

          (f) The captions and headings in this Agreement are not part of the
provisions hereof and shall have no force or effect.

          (g) No waiver by any person or entity of any breath of any condition
or provision contained in this Agreement shall be deemed a waiver of any similar
or dissimilar condition or provision at the same or any prior or subsequent
time. To be effective, any waiver must be set forth in a writing signed by (or
on behalf of) the waiving person or entity and must specifically refer to the
condition(s) or provision(s) of this Agreement being waived.

          (h) The Parties acknowledge that this Agreement supersedes any other
agreement between them concerning the specific subject matter hereof.

                     [REST OF PAGE INTENTIONALLY LEFT BLANK]

                                       12
<Page>

     This Agreement may be executed in several counterparts, each of which shall
be deemed an original, and said counterparts shall constitute one and the same
instrument. Signatures delivered by facsimile shall be valid and binding for all
purposes.

     IN WITNESS WHEREOF, the Parties have executed this Agreement as of the day
and year first above written.

                                          CATHERINE D. RICE

                                            /s/ Catherine D. Rice
                                          -----------------------------
                                                 Catherine D. Rice

                                          iSTAR FINANCIAL INC.

                                          By:   /s/ Jay S. Sugarman
                                              -------------------------
                                              Name: Jay S. Sugarman
                                              Title: Chairman and CEO

                                       13
<Page>
                                                                       EXHIBIT A

                           STOCK UNIT AWARD AGREEMENT

       THIS AGREEMENT, entered into as of November 6, 2002, by and between
Catherine D. Rice (the "EXECUTIVE"), and iStar Financial Inc. (together with its
successors and assigns, the "COMPANY").

                                   WITNESSETH:

       WHEREAS, the Executive is a key employee of the Company; and

       WHEREAS, the Company desires to grant Stock Units to the Executive
subject to the terms and conditions set forth below.

       NOW, THEREFORE, IT IS AGREED by and between the Company and the Executive
as follows:

1.     AWARD.

         Subject to the terms of this Agreement, the Executive is hereby awarded
100,000 Stock Units.

2.     DEFINITIONS.

       For purposes of this Agreement, the following definitions shall apply, in
addition to definitions set forth elsewhere herein:

       (a) "AWARD" shall mean this grant of Stock Units to the Executive.

       (b) "BASE PRICE" shall mean the closing price of a Share as reported on
the New York Stock Exchange on January 2, 2003.

       (c) "BOARD" shall mean the Board of Directors of the Company.

       (d) "BUSINESS DAY" shall mean any day on which banks in New York city are
open for business.

       (e) "CAUSE" or "WITHOUT CAUSE" shall mean "Cause" or "Without Cause" as
defined in, and determined in accordance with, the Employment Agreement.

       (f) "CHANGE OF CONTROL" shall have the meaning ascribed to such term
under the Long-Term Incentive Plan.

       (g) "CODE" shall mean the Internal Revenue Code of 1986, as amended.

       (h) "COMMITTEE" shall mean the Committee designated by the Board, if any
is so designated (the Board being under no obligation to establish or maintain
such a committee) consisting of two or more members of the Board, each of whom
shall be (i) a "Non-Employee Director" within the meaning of Rule 16b-3 under
the Exchange Act, and (ii) at the election of the Board, an "outside director"
within the meaning of Section 162(m) of the Code.

<Page>

       (i) "COMMON STOCK" shall mean the common stock, par value $0.001 of the
Company.

       (j) "DETERMINATION DATE" shall mean the earliest to occur of (i) January
31, 2004, (ii) the first date on which the Executive's employment with the
Company terminates by reason of death or Disability, or (iii) the date of the
occurrence of a Change of Control.

       (k) "DISABILITY" shall mean "Disability" as defined in, and determined in
accordance with, the Employment Agreement.

       (l) "EMPLOYMENT AGREEMENT" shall mean the Employment Agreement made as of
November 1, 2002 between the Company and the Executive, as from time to time
amended in accordance with its terms, or any successor to such Employment
Agreement then in effect (or, if none is in effect at a point in time, such
Employment Agreement or successor as last in effect).

       (m) "EXCHANGE ACT" shall mean the Securities Exchange Act of 1934, as
amended.

       (n) "FAIR MARKET VALUE" per Stock Unit shall mean the closing price of a
Share as reported on the New York Stock Exchange on the first trading day
immediately preceding the date as of which such value is being determined;
provided, however, that if the Fair Market Value of a Share for any date cannot
be determined as above provided, Fair Market Value of a Share shall be
determined by the Administrator by whatever means or method as to which the
Administrator, in the good faith exercise of its discretion, shall at such time
deem appropriate.

       (o) "LONG-TERM INCENTIVE PLAN" shall mean the iStar Financial Inc. 1996
Long-Term Incentive Plan (amended and restated as of March 13, 1998) or any
successor plan thereto, as may be in effect from time to time.

       (p) "SECURITIES ACT" shall mean the Securities Act of 1933, as amended.

       (q) "SHARE" shall mean a share of Common Stock.

       (r) "STOCK UNIT" shall mean a right, granted pursuant to this Agreement,
of the Executive to receipt of one Share (or cash in lieu thereof pursuant to
Section 5).

       (s) "TRR" shall mean, as of the Determination Date, the quotient of (i)
the sum of (A) the total amount of dividends per Share declared and paid from
the date of this Agreement through the Determination Date and (B) the net gain
or loss per Share between the Base Price and the average of the closing prices
of a Share as reported on the New York Stock Exchange for the 20 trading days
immediately preceding and including the Determination Date, divided by (ii) the
Base Price.

3.     VESTING.

       (a) In determining the number of Stock Units which vest as of a
Determination Date pursuant to this Agreement, the following schedule shall
apply:

                                      -2-
<Page>

                  TRR                        NUMBER OF SHARE UNITS VESTING
                  ---                        -----------------------------

               0.00%-9.99%                                   0

        Between 10.00%, and 20.00%                0-100,000 using straight
                                                      line interpolation

             20.00% or more                               100,000

       (b) On the Determination Date, that number of Stock Units determined by
reference to the TRR calculation described in Section 3(a) shall become vested
and the remaining Stock Units shall be forfeited.

4.     DIVIDEND EQUIVALENT.

       No dividends or any equivalent thereof shall be provided to the Executive
with respect to any unvested Stock Units.

5.     SETTLEMENT OF UNITS.

       (a) Each outstanding Stock Unit shall be settled as soon as practicable,
and in any event within five Business Days, after the Determination Date by the
transfer to the Executive of one Share or, at the option of the Company, cash in
lieu thereof; provided, however, that, Stock Units must be settled in cash if
the Shares to be delivered in settlement of Stock Units are not registered under
the Securities Act or listed on the principal U.S. securities exchange on which
the Shares are then listed. If the Company elects to deliver cash in settlement
of Stock Units, the amount of cash per Stock Unit to be delivered to the
Executive shall be equal to the average of the closing prices of a Share as
reported on the New York Stock Exchange (or other principal stock exchange on
which the Shares are then traded) for the 20 trading days ending on and
including the Determination Date. Upon any settlement of Stock Units in Shares,
the Company shall deliver or cause to be delivered one or more certificates
representing the applicable number of Shares.

       (b) Upon any termination of employment, any Stock Units that have not
previously vested and do not thereupon vest as provided herein shall
automatically, and with no further action, cease to be outstanding and be
forfeited.

6.     TAX WITHHOLDING.

       (a) The Company shall have the right to require, prior to the delivery of
any Shares or the payment of any cash pursuant to this Award, payment by the
Executive of any federal, state, local or other taxes which may be required to
be withheld or paid in connection with such award. The Administrator may provide
that the Executive may satisfy any such obligation by any of the following
means: (i) a cash payment to the Company; (ii) withholding of whole Shares from
the Shares otherwise to be distributed upon settlement and having an aggregate
Fair Market Value, determined as of the date the obligation to withhold or pay
taxes arises in connection with this award, equal to the amount necessary to
satisfy any such obligation; or (iii) any combination of (i) and (ii); provided,
however, that the Administrator shall have sole discretion to disapprove of an
election pursuant to any of the foregoing clauses (ii) and (iii). Any fraction
of a Share which would be required to satisfy such an obligation shall be
disregarded and the remaining amount due shall be paid in cash by the Executive.

                                      -3-
<Page>

       (b) Notwithstanding anything contained in this Agreement to the contrary,
the Executive's satisfaction of any tax-withholding requirements imposed by the
Administrator shall be a condition precedent to the Company's obligation as may
otherwise be provided hereunder to provide Shares to the Executive.

7.     TRANSFERABILITY.

       This Award is not transferable except as designated by the Executive by
will or by the laws of descent and distribution or, subject to such procedures
as the Administrator may establish, to or for the benefit of members of the
Executive's family. Except to the extent permitted by the Administrator in the
case of transfers to or for the benefit of members of the Executive's family,
during the Executive's lifetime this award shall be settled only by the
Executive or the Executive's legal representative. Except as permitted by the
foregoing, this Award may not be sold transferred, assigned, pledged,
hypothecated, voluntarily encumbered or otherwise disposed of (whether by
operation of law or otherwise) or be subject to execution, attachment or similar
process. Any sale, transfer, assignment, pledge, hypothecation, voluntary
encumbrance or other disposition of this Award not permitted by the foregoing
shall be wholly null and void.

8.     REPRESENTATIONS.

       The Shares, when and if issued, will be registered under the Securities
Act and any applicable state securities laws, pursuant to an effective
registration statement on Form S-8 (or any successor form). The Executive hereby
represents and covenants that any subsequent sale of any such Shares shall be
made either pursuant to an effective registration statement under the Securities
Act and any applicable state securities laws, or pursuant to an exemption from
registration under the Securities Act and such state securities laws.

9.     ADJUSTMENT OF STOCK UNITS.

       In the event of any change in the outstanding Shares by reason of any
stock dividend, split, spin-off, recapitalization or other similar change, the
terms and the number of any outstanding Stock Units shall be equitably adjusted
by the Administrator in its discretion to the extent the Administrator
determines that such adjustment is necessary to preserve the benefit of this
Award for the Executive and the Company. In the event of any adjustment pursuant
to this Section 9, the Administrator shall promptly deliver to the Executive a
notice (i) setting forth in reasonable detail (A) the transactions and/or events
that lead to the adjustment and (B) the method by which the adjustment was
calculated or otherwise determined and (ii) specifying the adjustment made.

10.    ADMINISTRATION.

       This Award shall be administered by the Board or, if so determined by the
Board, the Committee (the Board or Committee, as applicable, the
"Administrator"). Notwithstanding the foregoing, except as otherwise determined
by the Board, for any period during which the Company's Long-Term Incentive Plan
is in effect, the Administrator hereunder shall be the "Administrator" under
such plan (the "LTIP Administrator"), and the rules applicable to the LTIP
Administrator's internal procedures shall apply.

11.    AWARD CONFERS NO RIGHTS AS SHAREHOLDER.

       The Executive shall not be entitled to any privileges of ownership with
respect to Shares subject to this Award unless and until such Shares are
delivered upon a settlement of a Stock Unit and the Executive becomes a
shareholder of record with respect to such delivered Shares; and the Executive
shall

                                      -4-
<Page>

not be considered a shareholder of the Company with respect to any such Shares
not so purchased and delivered.

12.    NO RIGHTS TO CONTINUED EMPLOYMENT.

       In no event shall the granting of this Award or its acceptance by the
Executive give or be deemed to give the Executive any rights to continued
employment by the Company or any affiliate of the Company.

13.    DISPUTE RESOLUTION.

       Any controversy, dispute or claim arising out of or related to this
Agreement shall be resolved by binding arbitration in accordance with the
dispute resolution provisions of the Employment Agreement, after proceeding in
accordance with any claims procedures adopted for purposes hereof.

14.    WAIVER OF RESPONSIBILITY.

       The Executive understands that the Company has assumed no responsibility
for advising the Executive as to the tax consequences to the Executive of the
grant of this Award. The Executive should consult with her individual tax
advisor concerning the applicability of Federal, state and local tax laws to
this Award and to her personal tax circumstances.

15.    NOTICES AND OTHER MISCELLANEOUS PROVISIONS.

       (a) CERTAIN PROCEDURAL TERMS. The provisions of Section 14(a) through
14(d) of the Employment Agreement as in effect when this Agreement is executed
shall apply to this Agreement as if fully set forth herein, to the extent not
inconsistent herewith, with references to the "Executive" being deemed to be
references to the Executive and with references to the "Parties" being deemed to
be references to the Executive and the Company.

       (b) DESIGNATION OF BENEFICIARY. If permitted by the Company, the
Executive may file with the Administrator a written designation of one or more
persons as such Executive's beneficiary or beneficiaries (both primary and
contingent) in the event of the Executive's death.

16.    COUNTERPARTS.

       This Agreement may be executed in two or more counterparts, each of which
shall be deemed an original and all of which together shall constitute one and
the same instrument. Signatures delivered by facsimile shall be valid and
binding for all purposes.

                     [Rest of Page Intentionally Left Blank]

                                      -5-
<Page>

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

                                      CATHERINE D. RICE

                                      -----------------------------------------

                                      ISTAR FINANCIAL INC.

                                      By:
                                          -------------------------------------

                                      -6-
<Page>
                                                                       EXHIBIT B

                           STOCK UNIT AWARD AGREEMENT

       THIS AGREEMENT, entered into as of November 6, 2002, by and between
Catherine D. Rice (the "EXECUTIVE"), and iStar Financial Inc. (together with its
successors and assigns, the "COMPANY").

                                   WITNESSETH:

       WHEREAS, the Executive is a key employee of the Company; and

       WHEREAS, the Company desires to grant Stock Units to the Executive
subject to the terms and conditions set forth below.

       NOW, THEREFORE, IT IS AGREED by and between the Company and the Executive
as follows:

1.     AWARD.

       Subject to the terms of this Agreement, the Executive is hereby awarded
108,980 Stock Units.

2.     DEFINITIONS.

       For purposes of this Agreement, the following definitions shall apply, in
addition to definitions set forth elsewhere herein:

       (a) "AWARD" shall mean this grant of Stock Units to the Executive.

       (b) "BOARD" shall mean the Board of Directors of the Company.

       (c) "BUSINESS DAY" shall mean any day on which banks in New York City are
open for business.

       (d) "CAUSE" or "WITHOUT CAUSE" shall mean "Cause" or "Without Cause" as
defined in, and determined in accordance with, the Employment Agreement.

       (e) "CHANGE OF CONTROL" shall have the meaning ascribed to such term
under the Long-Term Incentive Plan.

       (f) "CODE" shall mean the Internal Revenue Code of 1986, as amended.

       (g) "COMMITTEE" shall mean the Committee designated by the Board, if any
is so designated (the Board being under no obligation to establish or maintain
such a committee) consisting of two or more members of the Board, each of whom
shall be (i) a "Non-Employee Director" within the meaning of Rule 16b-3 under
the Exchange Act, and (ii) at the election of the Board, an "outside director"
within the meaning of Section 162(m) of the Code.

       (h) "COMMON STOCK" shall mean the common stock, par value $0.001 of the
Company.

       (i) "DISABILITY" shall mean "Disability" as defined in, and determined in
accordance with, the Employment Agreement.

<Page>

       (j) "EMPLOYMENT AGREEMENT" shall mean the Employment Agreement made as of
November 1, 2002 between the Company and the Executive, as from time to time
amended in accordance with its terms, or any successor to such Employment
Agreement then in effect (or, if none is in effect at a point in time, such
Employment Agreement or successor as last in effect).

       (k) "EXCHANGE ACT" shall mean the Securities Exchange Act of 1934, as
amended.

       (l) "FAIR MARKET VALUE" per Stock Unit shall mean the closing price of a
Share as reported on the New York Stock Exchange on the first trading day
immediately preceding the date as of which such value is being determined;
provided, however, that if the Fair Market Value of a Share for any date cannot
be determined as above provided, Fair Market Value of a Share shall be
determined by the Administrator by whatever means or method as to which the
Administrator, in the good faith exercise of its discretion, shall at such time
deem appropriate.

       (m) "GOOD REASON" shall mean "Good Reason" as defined in, and determined
in accordance with, the Employment Agreement.

       (n) "LONG-TERM INCENTIVE PLAN" shall mean the iStar Financial Inc. 1996
Long-Term Incentive Plan (amended and restated as of March 13, 1998) or any
successor plan thereto, as may be in effect from time to time.

       (o) "STOCK UNIT" shall mean a right, granted pursuant to this Agreement,
of the Executive to receipt of one Share (or cash in lieu thereof pursuant to
Section 5).

       (p) "SECURITIES ACT" shall mean the Securities Act of 1933, as amended.).

       (q) "SHARE" shall mean a share of Common Stock.

3.     VESTING.

       Subject to the provisions hereof, the Stock Units shall become vested on
December 31, 2005 if the Executive's employment with the Company has not
terminated before such date; provided, however, that this Award shall vest prior
to such date (i) if the Executive's employment with the Company terminates by
reason of death or Disability, (ii) upon the occurrence of a Change of Control,
(iii) if the Company terminates the Executive's employment with the Company
Without Cause or (iv) if the Executive terminates her employment with the
Company for Good Reason.

4.     DIVIDEND EQUIVALENT; VOTING.

       (a) The Executive shall not be entitled to receive any cash payment, in
the nature of common stock dividend equivalents or otherwise, until the earlier
of (i) the first date on which the Company determines that there is sufficient
availability under the Long-Term Incentive Plan, in terms of the number of
Shares reserved for awards under the Long-Term Incentive Plan, to permit the
issuance of the same number of Shares as Stock Units then outstanding, and (ii)
May 31, 2003. From and after the date contemplated by the prior sentence, the
Company shall make an aggregate payment to the Executive in an amount equal to
the aggregate amount of ordinary cash dividends paid in respect of a number of
Shares equal to the number of Stock Units (or Shares issued in respect of the
Stock Units pursuant to Section 5), then held by the Executive. Such payments
shall take the form of either actual dividends (if Shares have been issued in
respect of Stock Units) or cash dividend equivalents. Such payments shall be
made on the same dates on which the related ordinary cash dividends are paid on
Shares.

                                      -2-
<Page>

       (b) Any Shares issued to Executive in respect of Stock Units (or Shares)
shall carry full voting rights (i.e., one vote per Share) which shall be
exercisable from and after the date that such Shares are issued.

5.     ISSUANCE OF SHARES; CASH SETTLEMENT.

       (a) Within five Business Days after the Company determines that there is
sufficient availability under the Long-Term Incentive Plan to permit the
issuance of the same number of Shares as Stock Units then outstanding, the
Company will deliver to the Executive one or more certificates representing such
Shares.

       (b) If, as of the date on which the Stock Units (or Shares if they have
been issued in respect thereof) vest, the Company has not delivered certificates
representing such vested Shares to the Executive in accordance with paragraph
(a), then the Executive shall be entitled to received a cash payment from the
Company, in lieu of such vested Shares, in an amount equal to the product of (1)
the number of Stock Units (or Shares) that have become vested multiplied by (2)
the average of the closing prices of a Share as reported on the New York Stock
Exchange (or other principal exchange on which the Shares are then trading) for
the 20 trading days ending on and including the vesting date. Any such cash
payment will be made no later than five Business Days after the date on which
such Stock Units (or Shares) become vested.

       (c) Upon any termination of employment, any Stock Units (or Shares) that
have not previously vested and do not thereupon vest as provided herein shall
automatically, and with no further action, cease to be outstanding and be
forfeited.

6.     ADDITIONAL PAYMENTS BY THE COMPANY.

       (a) If it is determined (as hereafter provided) that any payment or
distribution by the Company to or for the benefit of Executive, whether paid or
payable or distributed or distributable pursuant to the terms of this Agreement,
or the lapse or termination of any restriction on the Stock Units and Shares
which are the subject of this Agreement, (a "Payment"), would be subject to the
excise tax imposed by Section 4999 of the Code (or any successor provision
thereto) or to any similar tax imposed by state or local law, or any interest or
penalties with respect to such excise tax (such tax or taxes, together with any
such interest and penalties, are hereafter collectively referred to as the
"Excise Tax"), then Executive will be entitled to receive an additional payment
or payments (a "Gross-Up Payment") in an amount such that, after payment by
Executive of all taxes (including any interest or penalties imposed with respect
to such taxes), including any Excise Tax, imposed upon the Gross-Up Payment,
Executive retains an amount of the Gross-Up Payment equal to the Excise Tax
imposed upon the Payments.

       (b) All determinations required to be made under this Section, including
whether an Excise Tax is payable by Executive and the amount of such Excise Tax
and whether a Gross-Up Payment is required and the amount of such Gross-Up
Payment, will be made by a nationally recognized firm of certified public
accountants (the "Accounting Firm") selected by the mutual consent of Executive
and the Company; provided that if Executive and the Company cannot agree on the
identity of the Accounting Firm, then the Accounting Firm shall be
PricewaterhouseCoopers unless that firm is unwilling or unable to provide such
services, in which case the Accounting Firm may be selected by the Company. The
Company will direct the Accounting Firm to submit its determination and detailed
supporting calculations to both the Company and Executive within 30 calendar
days after the date of the Change of Control. If the Accounting Firm determines
that any Excise Tax is payable by Executive, the Company will pay the required
Gross-Up Payment to Executive no later than five calendar days prior to the date
such Excise Tax is paid by the Executive or by withholding, or due to be paid.
If the Accounting Firm determines that

                                      -3-
<Page>

no Excise Tax is payable by Executive, it will, at the same time as it makes
such determination, furnish Executive with an opinion that she has substantial
authority not to report any Excise Tax on her federal, state, local income or
other tax return. Any determination by the Accounting Firm as to the amount of
the Gross-Up Payment will be binding upon the Company and Executive. As a result
of the uncertainty in the application of Section 4999 of the Code (or any
successor provision thereto) and the possibility of similar uncertainty
regarding applicable state or local tax law at the time of any determination by
the Accounting Firm hereunder, it is possible that Gross-Up Payments which will
not have been made by the Company should have been made (an "Underpayment"),
consistent with the calculations required to be made hereunder. In the event
that the Company exhausts or fails to pursue its remedies pursuant to Section
6(f) hereof and Executive thereafter is required to make a payment of any Excise
Tax, Executive shall so notify the Company, which will direct the Accounting
Firm to determine the amount of the Underpayment that has occurred and to submit
its determination and detailed supporting calculations to both the Company and
Executive as promptly as possible. Any such Underpayment will be promptly paid
by the Company to, or for the benefit of, Executive within five business days
after receipt of such determination and calculations.

       (c) The Company and Executive will each provide the Accounting Firm
access to and copies of any books, records and documents in the possession of
the Company or Executive, as the case may be, reasonably requested by the
Accounting Firm, and otherwise cooperate with the Accounting Firm in connection
with the preparation and issuance of the determination contemplated by Section
6(b) hereof.

       (d) The federal, state and local income or other tax returns filed by
Executive will be prepared and filed on a consistent basis with the
determination of the Accounting Firm with respect to the Excise Tax payable by
Executive. Executive will make proper payment of the amount of any Excise Tax,
and at the request of the Company, provide to the Company true and correct
copies (with any amendments) of her federal income tax return as filed with the
Internal Revenue Service and corresponding state and local tax returns, if
relevant, as filed with the applicable taxing authority, and such other
documents reasonably requested by the Company, evidencing such payment. If prior
to the filing of Executive's federal income tax return, or corresponding state
or local tax return, if relevant, the Accounting Firm determines that the amount
of the Gross-Up Payment should be reduced, Executive will within five business
days pay to the Company the amount of such reduction.

       (e) The fees and expenses of the Accounting Firm for its services in
connection with the determinations and calculations contemplated by Sections
6(b) and (d) hereof will be borne by the Company. If such fees and expenses are
initially advanced by Executive, the Company will reimburse Executive the full
amount of such fees and expenses within five business days after receipt from
Executive of a statement therefor and reasonable evidence of her payment
thereof.

       (f) Executive will notify the Company in writing of any claim by the
Internal Revenue Service that, if successful, would require the payment by the
Company of a Gross-Up Payment. Such notification will be given as promptly as
practicable but no later than ten (10) business days after Executive actually
receives notice of such claim and Executive will further apprise the Company of
the nature of such claim and the date on which such claim is requested to be
paid (in each case, to the extent known by Executive). Executive will not pay
such claim prior to the earlier of (x) the expiration of the 30-calendar-day
period following the date on which she gives such notice to the Company and (y)
the date that any payment or amount with respect to such claim is due. If the
Company notifies Executive in writing prior to the expiration of such period
that it desires to contest such claim, Executive will:

              (A) provide the Company with any written records or documents in
her possession relating to such claim reasonably requested by the Company;

                                      -4-
<Page>

              (B) take such action in connection with contesting such claim as
the Company will reasonably request in writing from time to time, including
without limitation accepting legal representation with respect to such claim by
an attorney competent in respect of the subject matter and reasonably selected
by the Company;

              (C) cooperate with the Company in good faith in order effectively
to contest such claim; and

              (D) permit the Company to participate in any proceedings relating
to such claim; PROVIDED, HOWEVER, that the Company will bear and pay directly
all costs and expenses (including interest and penalties) incurred in connection
with such contest and will indemnify and hold harmless Executive, on an
after-tax basis, for and against any Excise Tax or income tax, including
interest and penalties with respect thereto, imposed in connection with such
claim and payment of costs and expenses. Without limiting the foregoing
provisions of this Section 6(f), the Company may control all proceedings taken
in connection with the contest of any claim contemplated by this Section 6(f)
and, at its sole option, may pursue or forego any and all administrative
appeals, proceedings, hearings and conferences with the taxing authority in
respect of such claim (provided that Executive may participate therein at her
own cost and expense) and may, at its option, either direct Executive to pay the
tax claimed and sue for a refund or contest the claim in any permissible manner,
and Executive agrees to prosecute such contest to a determination before any
administrative tribunal, in a court of initial jurisdiction and in one or more
appellate courts, as the Company will determine; provided, however, that if the
Company directs Executive to pay the tax claimed and sue for a refund, the
Company will advance the amount of such payment to Executive on an interest-free
basis and will indemnify and hold Executive harmless, on an after-tax basis,
from any Excise Tax or income tax, including interest or penalties with respect
thereto, imposed with respect to such advance; and PROVIDED FURTHER, HOWEVER,
that any extension of the statute of limitations relating to payment of taxes
for the taxable year of Executive with respect to which the contested amount is
claimed to bc due is limited solely to such contested amount. Furthermore, the
Company's control of any such contested claim will be limited to issues with
respect to which a Gross-Up Payment would be payable hereunder and Executive
will be entitled to settle or contest, as the case may be, any other issue
raised by the Internal Revenue Service or any other taxing authority.

       (g) If, after the receipt by Executive of an amount advanced by the
Company pursuant to Section 6(f) hereof, Executive receives any refund with
respect to such claim, Executive will (subject to the Company's complying with
the requirements of Section 6(f) hereof) promptly pay to the Company the amount
of such refund (together with any interest paid or credited thereon after any
taxes applicable thereto). If, after the receipt by Executive of an amount
advanced by the Company pursuant to Section 6(f) hereof, a determination is made
that Executive will not be entitled to any refund with respect to such claim and
the Company does not notify Executive in writing of its intent to contest such
denial or refund prior to the expiration of 30 calendar days after such
determination, then such advance will be forgiven and will not be required to be
repaid and the amount of such advance will offset, to the extent thereof, the
amount of Gross-Up Payment required to be paid pursuant to this Section 6. If,
after the receipt by Executive of a Gross-Up Payment but before the payment by
Executive of the Excise Tax, it is determined by the Accounting Firm that the
Excise Tax payable by Executive is less than the amount originally computed by
the Accounting Firm and consequently that the amount of the Gross-Up Payment is
larger than that required by this Section 6, Executive shall promptly refund to
the Company the amount by which the Gross-Up Payment initially made to Executive
exceeds the Gross-Up Payment required under this Section 6.

                                      -5-
<Page>

7.     TAX WITHHOLDING.

       (a) The Company shall have the right to require, prior to the delivery of
any Shares or the payment of any cash pursuant to this Award, payment by the
Executive of any federal, state, local or other taxes which may be required to
be withheld or paid in connection with such award. The Administrator may provide
that the Executive may satisfy any such obligation by any of the following
means: (i) a cash payment to the Company; (ii) withholding of whole Shares from
the Shares otherwise to be distributed upon settlement and having an aggregate
Fair Market Value, determined as of the date the obligation to withhold or pay
taxes arises in connection with this award, equal to the amount necessary to
satisfy any such obligation; or (iii) any combination of (i) and (ii); provided,
however, that the Administrator shall have sole discretion to disapprove of an
election pursuant to any of the foregoing clauses (ii) and (iii). Any fraction
of a Share which would be required to satisfy such an obligation shall be
disregarded and the remaining amount due shall be paid in cash by the Executive.

       (b) Notwithstanding anything contained in this Agreement to the contrary,
the Executive's satisfaction of any tax-withholding requirements imposed by the
Administrator shall be a condition precedent to the Company's obligation as may
otherwise be provided hereunder to provide Shares to the Executive.

8.     TRANSFERABILITY.

       This Award is not transferable except as designated by the Executive by
will or by the laws of descent and distribution or, subject to such procedures
as the Administrator may establish, to or for the benefit of members of the
Executive's family. Except to the extent permitted by the Administrator in the
case of transfers to or for the benefit of members of the Executive's family,
during the Executive's lifetime this award shall be settled only by the
Executive or the Executive's legal representative. Except as permitted by the
foregoing, this Award may not be sold transferred, assigned, pledged,
hypothecated, voluntarily encumbered or otherwise disposed of (whether by
operation of law or otherwise) or be subject to execution, attachment or similar
process. Any sale, transfer, assignment, pledge, hypothecation, voluntary
encumbrance or other disposition of this Award not permitted by the foregoing
shall be wholly null and void.

9.     REPRESENTATIONS.

       The Shares, when and if issued, will be registered under the Securities
Act and any applicable state securities laws, pursuant to an effective
registration statement on Form S-8 (or any successor form). The Executive hereby
represents and covenants that any subsequent sale of any such Shares shall be
made either pursuant to an effective registration statement under the Securities
Act and any applicable state securities laws, or pursuant to an exemption from
registration under the Securities Act and such state securities laws.

10.    ADJUSTMENT OF STOCK UNITS.

       In the event of any change in the outstanding Shares by reason of any
stock dividend, split, spin-off, recapitalization or other similar change, the
terms and the number of any outstanding Stock Units shall be equitably adjusted
by the Administrator in its discretion to the extent the Administrator
determines that such adjustment is necessary to preserve the benefit of this
Award for the Executive and the Company. In the event of any adjustment pursuant
to this Section 10, the Administrator shall promptly deliver to the Executive a
notice (i) setting forth in reasonable detail (A) the transactions and/or events
that lead to the adjustment and (B) the method by which the adjustment was
calculated or otherwise determined and (ii) specifying the adjustment made.

                                      -6-
<Page>

11.    ADMINISTRATION; PLAN GOVERNS.

       (a) This Award shall be administered by the Board or, if so determined by
the Board, the Committee (the Board or Committee, as applicable, the
"Administrator"). Notwithstanding the foregoing, except as otherwise determined
by the Board, for any period during which the Company's Long-Term Incentive Plan
is in effect, the Administrator hereunder shall be the "Administrator" under
such plan (the "LTIP Administrator"), and the rules applicable to the LTIP
Administrator's internal procedures shall apply.

       (b) From and after the date, if any, on which Shares are issued in
respect of Stock Units, the terms of this Agreement shall be subject to the
terms of the Long-Term Incentive Plan, a copy of which may be obtained by the
Executive from the office of the Secretary of the Company.

12.    AWARD CONFERS NO RIGHTS AS SHAREHOLDER. The Executive shall not be
entitled to any privileges of ownership with respect to Shares subject to this
Award unless and until such Shares are delivered upon a settlement of a Stock
Unit and the Executive becomes a shareholder of record with respect to such
delivered Shares; and the Executive shall not be considered a shareholder of the
Company with respect to any such Shares not so purchased and delivered.

13.    NO RIGHTS TO CONTINUED EMPLOYMENT.

       In no event shall the granting of this Award or its acceptance by the
Executive give or be deemed to give the Executive any rights to continued
employment by the Company or any affiliate of the Company.

14.    DISPUTE RESOLUTION.

       Any controversy, dispute or claim arising out of or related to this
Agreement shall be resolved by binding arbitration in accordance with the
dispute resolution provisions of the Employment Agreement, after proceeding in
accordance with any claims procedures adopted for purposes hereof.

15.    WAIVER OF RESPONSIBILITY.

       The Executive understands that the Company has assumed no responsibility
for advising the Executive as to the tax consequences to the Executive of the
grant of this Award. The Executive should consult with her individual tax
advisor concerning the applicability of Federal, state and local tax laws to
this Award and to her personal tax circumstances.

16.    NOTICES AND OTHER MISCELLANEOUS PROVISIONS.

       (a) CERTAIN PROCEDURAL TERMS. The provisions of Section 14(a) through
14(d) of the Employment Agreement as in effect when this Agreement is executed
shall apply to this Agreement as if fully set forth herein, to the extent not
inconsistent herewith, with references to the "Executive" being deemed to be
references to the Executive and with references to the "Parties" being deemed to
be references to the Executive and the Company.

       (b) DESIGNATION OF BENEFICIARY. If permitted by the Company, the
Executive may file with the Administrator a written designation of one or more
persons as such Executive's beneficiary or beneficiaries (both primary and
contingent) in the event of the Executive's death.

                                      -7-
<Page>

17.    COUNTERPARTS.

       This Agreement may be executed in two or more counterparts, each of which
shall be deemed an original and all of which together shall constitute one and
the same instrument. Signatures delivered by facsimile shall be valid and
binding for all purposes.

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

                                       CATHERINE D. RICE

                                       -----------------------------------------

                                       ISTAR FINANCIAL INC.

                                       By:
                                           -------------------------------------

                                      -8-<Page>

                                                                   EXHIBIT 10.21

[iSTAR FINANCIAL LOGO]

                                 CODE OF CONDUCT

INTRODUCTION

     It is the policy of iStar Financial Inc. that our business shall be
conducted in accordance with the highest moral, legal and ethical standards. Our
reputation for integrity is our most important asset and each employee and
director must contribute to the care and preservation of that asset.

     This reputation for integrity is the cornerstone of the public's faith and
trust in our Company; it is what provides us an opportunity to serve our
investors, customers and other stakeholders. A single individual's misconduct
can do much to damage a hard-earned reputation. No code of business conduct or
ethics can effectively substitute for the thoughtful behavior of an ethical
director, officer or employee. This Code of Conduct is presented to assist you
in guiding your conduct to enhance the reputation of our Company. The Code
supersedes all previous codes and policy statements.

     The Code is drafted broadly. In that respect, it is the Company's intent to
exceed the minimum requirements of the law and industry practice. Mere
compliance with the letter of the law is not sufficient to attain the highest
ethical standards. Good judgment and great care must also be exercised to comply
with the SPIRIT of the law and of this Code.

     The provisions of the Code apply to you, your spouse and members of your
immediate family. In addition, it covers any partnership, trust, or other
entity, which you, your spouse or members of your immediate family control.

     The Company intends to enforce the provisions of this Code vigorously.
Violations could lead to sanctions, including dismissal in the case of an
employee, as well as, in some cases, civil and criminal liability.

     Inevitably, the Code addresses questions and situations that escape easy
definition. No corporate code can cover every possible question of business
practice. There will be times when you are unsure about how the Code applies.
When in doubt, ask before you act.

     The Company has established a Compliance Committee that administers the
Company's overall compliance program, including the Code of Conduct. The
Committee consists of Nina Matis, the Company's Executive Vice President and
General Counsel, Tim O'Connor, Executive Vice President and Chief Operating
Officer, and Geoff Dugan, Senior Vice President and Assistant General Counsel.

     Upholding the Code is the responsibility of every employee and director.
Department heads are responsible for Code enforcement in their departments and
managers are accountable for the employees who report to them.

                                                                         11/1/02

<Page>

QUESTIONS ABOUT THE CODE; REPORTING SUSPECTED VIOLATIONS

     Any questions about how to interpret the Code of Conduct should be raised
with the Compliance Committee. Geoff Dugan, Senior Vice President and Assistant
General Counsel, has been designated as Compliance Officer for purposes of
enforcing the Code and he may be contacted by telephone at (415) 263-8639, by
confidential fax at (415) 391-3092, or by e-mail at gdugan@istarfinancial.com.

     If you know of or suspect any illegal or unethical conduct, or any other
violation of the Code, you should promptly report this to your supervisor or the
Compliance Officer. If you are not comfortable doing so for any reason, or if
you feel appropriate action is not being taken, you should contact any other
member of the Compliance Committee, or the Chief Executive Officer, or the
Chairman of the Audit Committee of the Board of Directors. You are not required
to identify yourself when reporting a violation.

     To the extent possible, we will endeavor to keep confidential the identity
of anyone reporting a violation of the Code of Conduct. We will also keep
confidential the identities of employees about whom allegations of violations
are brought, unless or until it is established that a violation has occurred. It
is the Company's policy that retaliation against employees who report actual or
suspected Code violations is prohibited; anyone who attempts to retaliate will
be subject to disciplinary action, up to and including dismissal.

CONFLICTS OF INTEREST

     The Company relies on the integrity and undivided loyalty of our employees
and directors to maintain the highest level of objectivity in performing their
duties. Each employee is expected to avoid any situation in which your personal
interests conflict, or have the appearance of conflicting, with those of the
Company. Individuals must not allow personal considerations or relationships to
influence them in any way when representing the Company in business dealings.

     A conflict situation can arise when an employee or director takes actions
or has interests that may make it difficult to perform work on behalf of the
Company objectively and effectively. Conflicts also arise when an employee or
director, or a member of his or her family, receives improper personal benefits
as a result of his or her position with the Company. Loans to, or guarantees of
obligations of, such persons are of special concern.

     All employees and directors must exercise great care any time their
personal interests might conflict with those of the Company. The APPEARANCE of a
conflict often can be as damaging as an ACTUAL conflict. PROMPT AND FULL
DISCLOSURE IS ALWAYS THE CORRECT FIRST STEP TOWARDS IDENTIFYING AND RESOLVING
ANY POTENTIAL CONFLICT OF INTEREST. Non-employee directors are expected to make
appropriate disclosures to the Board and to take appropriate steps to recuse
themselves from Board decisions with respect to transactions or other matters
involving the Company as to which

                                        2
<Page>

they are interested parties or with respect to which a real or apparent conflict
of interest exists.

     The following sections review several common problems involving conflicts
of interest. The list is not exhaustive. Each individual has a special
responsibility to use his or her best judgment to assess objectively whether
there might be even the appearance of acting for reasons other than to benefit
the Company, and to discuss any conflict openly and candidly with the Company.

     PAYMENTS AND GIFTS

     Employees who deal with the Company's borrowers, tenants, suppliers or
other third parties are placed in a special position of trust and must exercise
great care to preserve their independence. As a general rule, no employee should
ever receive a payment or anything of value in exchange for a decision involving
the Company's business. Similarly, no employee of the Company should ever offer
anything of value to government officials or others to obtain a particular
result for the Company. Bribery, kickbacks or other improper payments have no
place in the Company's business.

     The Company recognizes exceptions for token gifts of nominal value (less
than $250) or customary business entertainment, when a clear business purpose is
involved. If you are in doubt about the policy's application, the Compliance
Committee should be consulted.

     PERSONAL FINANCIAL INTERESTS; OUTSIDE BUSINESS INTERESTS

     Employees should avoid any outside financial interests that might be in
conflict with the interests of the Company. No employee may have any significant
direct or indirect financial interest in, or any business relationship with, a
person or entity that does business with the Company or is a competitor of the
Company. A financial interest includes any interest as an owner, creditor or
debtor. Indirect interests include those through an immediate family member or
other person acting on his or her behalf. This policy does not apply to an
employee's arms-length purchases of goods or services for personal or family
use, or to the ownership of shares in a publicly held corporation.

     Employees should not engage in outside jobs or other business activities
that compete with the Company in any way. Further, any outside or secondary
employment ("moonlighting") may interfere with the job being performed for the
Company and is discouraged. Under no circumstances may employees have outside
interests that are in any way detrimental to the best interests of the Company.

     You must disclose to the Compliance Committee any personal activities or
financial interests that could negatively influence, or give the appearance of
negatively influencing, your judgment or decisions as a Company employee. The
Compliance Committee will then determine if there is a conflict and, if so, how
to resolve it without compromising the Company's interests.

                                        3
<Page>

     CORPORATE BOARDS

     The director of an organization has access to sensitive information and
charts the course of the entity. If you are invited to serve as a director of an
outside organization, the Company must take safeguards to shield both the
Company and you from even the appearance of impropriety. For that reason, any
employee invited to join the Board of Directors of another organization
(including a nonprofit or other charitable organization) must obtain the
approval of the Compliance Committee. Directors who are invited to serve on
other Boards should promptly notify the Chairman.

     CORPORATE OPPORTUNITIES

     An employee or director must not divert for personal gain any business
opportunity available to the Company. The duty of loyalty to the Company is
violated if the employee or director personally profits from a business
opportunity that rightfully belongs to the Company. This problem could arise,
for example, if an employee or director becomes aware through the use of
corporate property, information or position of an investment opportunity (either
a loan or equity transaction) in which the Company is or may be interested, and
then participates in the transaction personally or informs others of the
opportunity before the Company has the chance to participate in the transaction.
An employee or director also is prohibited from using corporate property,
information or position for personal gain. Employees and directors owe a duty to
the Company to advance its legitimate interests when the opportunity to do so
arises and, in the case of a non-employee director, such director is aware of
the Company's possible interest through use of corporate property, information
or position.

USE AND PROTECTION OF COMPANY ASSETS

     Proper use and protection of the Company's assets is the responsibility of
all employees. Company facilities, materials, equipment, information and other
assets should be used only for conducting the Company's business and are not to
be used for any unauthorized purpose. Employees should guard against waste and
abuse of Company assets in order to improve the Company's productivity.

CONFIDENTIALITY

     One of the Company's most important assets is its confidential corporate
information. The Company's legal obligations and its competitive position often
mandate that this information remain confidential.

     Confidential corporate information relating to the Company's financial
performance (e.g. quarterly financial results of the Company's operations) or
other transactions or events can have a significant impact on the value of the
Company's securities. Premature or improper disclosure of such information may
expose the individual involved to onerous civil and criminal penalties.

                                        4
<Page>

     You must not disclose confidential corporate information to anyone outside
the Company, except for a legitimate business purpose (such as contacts with the
Company's accountants or its outside lawyers). Even within the Company,
confidential corporate information should be discussed only with those who have
a need to know the information. Your obligation to safeguard confidential
corporate information continues even after you leave the Company.

     The same rules apply to confidential information relating to other
companies with which we do business. In the course of the many pending or
proposed transactions that this Company has under consideration at any given
time, there is a great deal of non-public information relating to other
companies to which our employees may have access. This could include "material"
information that is likely to affect the value of the securities of the other
companies.

     Employees and directors who learn material information about suppliers,
customers, venture partners, acquisition targets or competitors through their
work at the Company must keep it confidential and must not buy or sell stock in
such companies until after the information becomes public. Employees and
directors must not give tips about such companies to others who may buy or sell
the stocks of such companies.

     The Company has issued a detailed "Statement of Policy Concerning Insider
Trading and Special Trading Procedures" regarding the use of confidential
information in connection with trading in securities. You should become familiar
with this policy and the procedures it requires. If you have any questions
regarding trading in the Company's securities or on the basis of confidential
information, you should contact Geoff Dugan, the Compliance Officer.

DEALINGS WITH THE PRESS AND COMMUNICATIONS WITH THE PUBLIC

     The Company's Chief Executive Officer and President are the Company's
principal spokesmen. If someone outside the Company asks you questions or
requests information regarding the Company, its business or financial results,
do not attempt to answer. All requests for information - from reporters,
securities analysts, shareholders or the general public - should be referred to
the President, who will handle the request or delegate it to an appropriate
person.

ACCOUNTING MATTERS

     INTERNAL ACCOUNTING CONTROLS

     The Company places the highest priority on "best practices" disclosure. Our
annual reports, quarterly reports and press releases, and other public
disclosure of the Company's financial results, reflect how seriously we take
this responsibility.

     To this end, we have established an internal Disclosure Committee, which
includes key members of senior management responsible for our internal financial
and risk management controls. This Committee, which currently consists of
Spencer

                                        5
<Page>

Haber, Tim O'Connor, Andy Richardson, Colette Tretola, Steven Sinnett and Geoff
Dugan, meets on a quarterly basis, and additionally when issues arise, to
discuss the state of the Company's internal controls, reporting systems and the
integrity of our financial information relative to our disclosure obligations.
This Committee assists senior management and the Audit Committee of the Board in
overseeing the Company's internal control systems and evaluating our public
disclosure processes.

     Each employee shares this responsibility with senior management and the
Board of Directors and must help maintain the integrity of the Company's
financial records. We trust that every employee understands that protecting the
integrity of our information gathering, information quality, internal control
systems and public disclosures is one of the highest priorities we have as a
firm.

     If you ever observe conduct that causes you to question the integrity of
our internal accounting controls and/or disclosure, or you otherwise have reason
to doubt the accuracy of our financial reporting, it is imperative that you
bring these concerns to our attention immediately. You should promptly report
any concerns to any member of the Disclosure Committee. If you are not
comfortable providing your name, you may report anonymously. Any kind of
retaliation against an employee for raising these issues is strictly prohibited
and will not be tolerated.

     IMPROPER INFLUENCE ON THE CONDUCT OF AUDITS

     It is unlawful for any officer or director of the Company, or any other
person acting under the direction of such person, to take any action to
fraudulently influence, coerce, manipulate, or mislead the independent
accountants engaged in the performance of an audit of the Company's financial
statements for the purpose of rendering such financial statements materially
misleading. Any such action is a violation of this Code of Conduct. Types of
conduct that might constitute improper influence include the following:

  -  Offering or paying bribes or other financial incentives, including offering
     future employment or contracts for non-audit services,

  -  Providing an auditor with inaccurate or misleading legal analysis,

  -  Threatening to cancel or canceling existing non-audit or audit engagements
     if the auditor objects to the Company's accounting practices or procedures,

  -  Seeking to have a partner removed from the audit engagement because the
     partner objects to the Company's accounting practices or procedures,

  -  Blackmailing, and

  -  Making physical threats.

Any employee or director who engages in such conduct will be subject to
sanctions under the Code, including dismissal in the case of an employee, in
addition to potential civil and criminal liability.

                                        6
<Page>

RECORDS RETENTION

     You should retain documents and other records for such period of time as
you and your colleagues will reasonably need such records in connection with the
Company's business activities. All documents not required to be retained for
business or legal reasons, including draft work product, should not be retained
and should be destroyed in order to reduce the high cost of storing and handling
the vast amounts of material that would otherwise accumulate. However, under
unusual circumstances, such as litigation, governmental investigation or if
required by applicable state and federal law and regulations, the Compliance
Committee may notify you if retention of documents or other records is
necessary.

LEGAL COMPLIANCE

     Pertinent laws of every jurisdiction in which the Company operates must be
followed. Each employee is charged with the responsibility of acquiring
sufficient knowledge of the laws relating to his or her particular duties in
order to recognize potential dangers and to know when to seek legal advice. In
any instance where the law is ambiguous or difficult to interpret, the matter
should be reported to the Company's management who in turn will seek legal
advice from the Company's legal counsel as appropriate.

FAIR DEALING

     It is the Company's policy to deal fairly with its customers, suppliers,
competitors and employees. In the course of business dealings on behalf of the
Company, no employee should take advantage of another person or party through
manipulation, concealment, abuse of privileged information, misrepresentation of
material facts or any other unfair business practice.

ENFORCEMENT

     The conduct of each employee matters vitally to the Company. A misstep by a
single employee can cost the Company dearly; it undermines all of our
reputations. For these reasons, violations of this Code of Conduct may lead to
significant penalties, including dismissal.

WAIVERS

     Any waiver of this Code of Conduct for executive officers or directors of
the Company may be made only by the Board of Directors, or by a Board Committee
specifically authorized for this purpose, and must be promptly disclosed to the
Company's shareholders.

                                        7

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