Document:

Exhibit 4.1

 

[Face of Note]

 

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

 

CUSIP 45031UAW1

 

5.875% Senior Notes due 2016

 

	
  No. 1

  	
   

  	
  $500,000,000   

  

iSTAR FINANCIAL INC.

 

promises to pay to               ,
or registered assigns, the principal sum of FIVE HUNDRED MILLION on March 15,
2016.

 

Interest Payment Dates: March 15 and September 15

 

Record Dates:  March 1 and September 1

 

Dated:  February 21, 2006

 

	
   

  	
  iSTAR FINANCIAL INC.

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
  Title:

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
  Title:

  

 

 

SEAL

 

This is one of the Notes referred to

in the within-mentioned Supplemental Indenture:

 

US BANK TRUST NATIONAL ASSOCIATION
  as Trustee

 

 

	
  By:

  	
   

  	
   

  
	
   

  	
  Authorized Signatory

  

 

A-1

 

 [Back of Note]

5.875% Senior Notes due 2016

 

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

 

1.  INTEREST.  iStar Financial Inc., a Maryland corporation
(the “Company”), promises to pay interest on
the principal amount of this note at 5.875% per annum from February 21,
2006 until maturity.  The company will
pay interest semi-annually in arrears on March 15 and September 15  of each year, or if any such day is not a
Business Day, on the next succeeding Business Day (each an “Interest Payment Date”). 
Interest on the notes will accrue from the most recent date to which
interest has been paid or, if no interest has been paid, from February 21,
2006; provided that if there is no existing
default in the payment of interest, and if this note is authenticated between a
record date referred to on the face hereof and the next succeeding interest
payment date, interest shall accrue from such next succeeding interest payment
date; provided, further, that the first
interest payment date shall be September 15, 2006. The company shall pay
interest (including post-petition interest in any proceeding under any
bankruptcy law) on overdue principal and premium, if any, from time to
time on demand at the rate then in effect; it shall pay interest (including
post-petition interest in any proceeding under any bankruptcy law) on
overdue installments of interest (without regard to any applicable grace
periods) from time to time on demand at the same rate to the extent
lawful.  Interest will be computed on the
basis of a 360-day year of twelve 30-day months.  If any
interest payment date on the Notes other than the maturity date is not a
Business Day, such interest payment date will be postponed to the next
succeeding Business Day. If the maturity date of the Notes falls on a day that
is not a Business Day, the required payment of principal and interest will be
made on the next succeeding Business Day as if made on the date such payment
was due, and no interest will accrue on such payment for the period from and
after the maturity date to the date of such payment on the next succeeding
Business Day.

 

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

 

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

 

4.  INDENTURE.  The
Company issued the Notes under an Indenture dated as of February 5, 2001,
as amended and supplemented, including as supplemented by a Supplemental
Indenture dated as of 

 

A-2

 

February 21, 2006 (collectively, the “Indenture”)
between the Company and the Trustee.  The
terms of the Notes include those stated in the Indenture and those made part of
the Indenture by reference to the Trust Indenture Act of 1939, as amended (15
U.S. Code §§ 77aaa-77bbbb).  The
Notes are subject to all such terms, and Holders are referred to the Indenture
and such Act for a statement of such terms. 
To the extent any provision of this Note conflicts with the express
provisions of the Indenture, the provisions of the Indenture shall govern and
be controlling.  The Notes are
obligations of the Company.  The Company
is issuing $500.0 million in aggregate principal amount on the Issue Date and
may issue Additional Notes in accordance with the terms of the Indenture.

 

5.  OPTIONAL REDEMPTION.

 

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

 

“Applicable
Premium” means, with respect to the Notes at any Redemption Date,
the greater of: (1) 1.0% of the principal amount of such Note; and (2) the
excess of (a) the present value at such Redemption Date of (i) the
principal amount of such Note on the redemption date plus (ii) all
required remaining scheduled interest payments due on such Note through March 15,
2016, computed using a discount rate equal to the Treasury Rate plus 20 basis
points; over (b) the principal amount of such Note on such Redemption
Date.  Calculation of the Applicable
Premium will be made by the Company or on behalf of the Company by such Person
as the Company shall designate; provided, however,
that such calculation shall not be a duty or obligation of the Trustee.

 

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

 

6.  MANDATORY REDEMPTION.

 

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

 

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

 

A-3

 

8.  DENOMINATIONS, TRANSFER, EXCHANGE.  The Notes are in registered form without
coupons in denominations of $1,000 and integral multiples of $1,000.  The transfer of Notes may be registered and
Notes may be exchanged as provided in the Indenture.  The Registrar and the Trustee may require a
Holder, among other things, to furnish appropriate endorsements and transfer
documents and the Company and the Trustee may require a Holder to pay any taxes
and fees required by law or permitted by the Indenture.  The Company need not exchange or register the
transfer of any Note or portion of a Note selected for redemption, except for
the unredeemed portion of any Note being redeemed in part.  Also, the Company need not exchange or
register the transfer of any Notes for a period of 15 days before a selection
of Notes to be redeemed or during the period between a record date and the
corresponding Interest Payment Date.

 

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

 

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

 

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

 

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

 

A-4

 

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

 

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

 

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

 

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

 

A-5

 

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

 

iStar Financial Inc.

1114 Avenue of the Americas, 27th Floor

New York, NY 10036

Attention:  Investor Relations

 

A-6

 

ASSIGNMENT FORM

 

To assign this Note, fill in the form below:

 

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

  	
   

  
	
   

  	
  (Insert assignee’s legal name)

  
	
   

  	
   

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

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
   

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

  
	
  and irrevocably appoint

  	
   

  
			

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

	
  Date:

  	
   

  	
   

  

 

	
   

  	
  Your Signature:

  	
   

  
	
   

  	
   

  	
  (Sign exactly as your name appears on 

  the face of this Note)

  
	
   

  	
   

  
	
  Signature Guarantee*:

  	
   

  	
   

  
				

 

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

 

A-7

 

SCHEDULE OF EXCHANGES OF INTERESTS IN THE GLOBAL NOTE

 

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

 

	
  Date of Exchange

  	
   

  	
  Amount of

  decrease in

  Principal Amount 

  of this Global Note

  	
   

  	
  Amount of

  increase in

  Principal Amount 

  of this Global Note

  	
   

  	
  Principal Amount 

  of this Global Note 

  following such 

  decrease

  (or increase)

  	
   

  	
  Signature of 

  authorized officer 

  of Trustee or Note 

  Custodian

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  

 

A-8Exhibit 4.2

 

[Face of Note]

 

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

 

CUSIP 45031UAX9

 

5.650% Senior Notes due 2011

 

	
  No. 1

  	
  $500,000,000

  

 

 

iSTAR FINANCIAL INC.

 

promises to pay to               ,or
registered assigns, the principal sum of FIVE MILLION DOLLARS on September 15,
2011.

 

Interest Payment Dates: March 15 and September 15

 

Record Dates: March 1 and September 1

 

	
  Dated: February 21, 2006

  	
   

  
	
   

  	
   

  
	
   

  	
  iSTAR FINANCIAL INC.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
  Title:

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
  Title:

  

 

 

SEAL

 

This is one of the Notes referred to

in the within-mentioned Supplemental Indenture:

US BANK TRUST NATIONAL ASSOCIATION

  as Trustee

 

 

	
  By:

  	
   

  	
   

  
	
   

  	
  Authorized Signatory

  

 

A-1

 

[Back of Note]

5.650% Senior Notes due 2011

 

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

 

1.  INTEREST.
iStar Financial Inc., a Maryland corporation (the “Company”),
promises to pay interest on the principal amount of this note at 5.650% per
annum from February 21, 2006 until maturity. The company will pay interest
semi-annually in arrears on March 15 and September 15 of each year,
or if any such day is not a Business Day, on the next succeeding Business Day
(each an “Interest Payment Date”). Interest on
the notes will accrue from the most recent date to which interest has been paid
or, if no interest has been paid, from February 21, 2006; provided that if there is no existing default in the payment
of interest, and if this note is authenticated between a record date referred
to on the face hereof and the next succeeding interest payment date, interest
shall accrue from such next succeeding interest payment date; provided, further, that the first interest payment date
shall be September 15, 2006. The company shall pay interest (including
post-petition interest in any proceeding under any bankruptcy law) on
overdue principal and premium, if any, from time to time on demand at the rate
then in effect; it shall pay interest (including post-petition interest in any
proceeding under any bankruptcy law) on overdue installments of interest
(without regard to any applicable grace periods) from time to time on
demand at the same rate to the extent lawful. Interest will be computed on the
basis of a 360-day year of twelve 30-day months. If any interest payment date on the Notes other than the maturity date is
not a Business Day, such interest payment date will be postponed to the next
succeeding Business Day. If the maturity date of the Notes falls on a day that
is not a Business Day, the required payment of principal and interest will be
made on the next succeeding Business Day as if made on the date such payment
was due, and no interest will accrue on such payment for the period from and
after the maturity date to the date of such payment on the next succeeding
Business Day.

 

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

 

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

 

4.  INDENTURE. The Company issued the Notes under an Indenture
dated as of February 5, 2001, as amended and supplemented, including as
supplemented by a Supplemental Indenture dated as of February 21, 2006
(collectively, the “Indenture”)
between the Company and the Trustee. The terms of 

 

A-2

 

the Notes include those stated in the Indenture and those made part of
the Indenture by reference to the Trust Indenture Act of 1939, as amended (15
U.S. Code §§ 77aaa-77bbbb). The Notes are subject to all such terms, and
Holders are referred to the Indenture and such Act for a statement of such
terms. To the extent any provision of this Note conflicts with the express
provisions of the Indenture, the provisions of the Indenture shall govern and
be controlling. The Notes are obligations of the Company. The Company is
issuing $500.0 million in aggregate principal amount on the Issue Date and may
issue Additional Notes in accordance with the terms of the Indenture.

 

5.  OPTIONAL REDEMPTION.

 

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

 

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

 

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

 

6.  MANDATORY REDEMPTION.

 

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

 

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

 

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

 

A-3

 

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

 

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

 

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

 

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

 

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

 

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

 

A-4

 

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

 

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

 

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

 

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

 

A-5

 

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

 

iStar Financial Inc.

1114 Avenue of the Americas, 27th Floor

New York, NY 10036

Attention: Investor Relations

 

A-6

 

ASSIGNMENT FORM

 

To assign this Note, fill in the form below:

 

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

  	
   

  
	
   

  	
  (Insert assignee’s legal name)

  
	
   

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

  
	
   

  
	
   

  
	
   

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

  
	
  and irrevocably appoint

  	
   

  
			

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

	
  Date: 

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Your Signature:

  	
   

  
	
   

  	
   

  	
  (Sign exactly as your name appears on 

  the face of this Note)

  
	
  Signature Guarantee*: 

  	
   

  	
   

  	
   

  	
   

  
							

 

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

 

A-7

 

SCHEDULE OF EXCHANGES OF INTERESTS IN THE GLOBAL NOTE

 

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

 

	
  Date of Exchange

  	
   

  	
  Amount of

  decrease in

  Principal Amount 

  of this Global Note

  	
   

  	
  Amount of

  increase in

  Principal Amount 

  of this Global Note

  	
   

  	
  Principal Amount 

  of this Global Note 

  following such 

  decrease

  (or increase)

  	
   

  	
  Signature of 

  authorized officer 

  of Trustee or Note 

  Custodian

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  

 

A-8

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