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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.
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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
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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.
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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.
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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
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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.
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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.
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