Exhibit
10.68



EXECUTION COPY


 


REGISTRATION RIGHTS AGREEMENT


 


THIS REGISTRATION RIGHTS
AGREEMENT (this “Agreement”) is made and entered into as of November 17,
2003 by and between VORNADO REALTY TRUST, a Maryland real estate investment
trust (the “Company”), on the one hand, and Bel Holdings LLC (together with
permitted successors and assigns who acquire Registrable Securities from time
to time, in each case as long as such person is a record holder of any
Registrable Securities, each individually, a “Holder”, and collectively, the
“Holders”) on the other hand.


 


WHEREAS, the Holder is
receiving on the date hereof Series D-10 Preferred Units of limited partnership
interest (“Units”) in Vornado Realty L.P., a Delaware limited partnership (the
“Partnership”);


 


WHEREAS, in connection
therewith, the Company has agreed to grant to the Holder the Registration
Rights (as defined in Section 1 hereof);


 


NOW, THEREFORE, the
parties hereto, in consideration of the foregoing and the mutual covenants and
agreements hereinafter set forth, hereby agree as follows:


 


SECTION 1.         REGISTRATION RIGHTS


 


If
a Holder receives 7.00% Series D-10 Cumulative Redeemable Preferred Shares of
Beneficial Interest, liquidation preference $25.00 per share, of the Company
(“Preferred Shares”) upon redemption of Units (the “Redemption Shares”)
pursuant to the terms of the Second Amended and Restated Agreement of Limited
Partnership of the Partnership, as the same may be amended from time to time
(the “Partnership Agreement”), then, unless such Redemption Shares are issued
to such Holder pursuant to an Issuer Registration Statement as provided in
Section 2 below, such Holder shall be entitled to offer for sale pursuant
to a shelf registration statement, the Redemption Shares, subject to the terms
and conditions set forth in Section 3 hereof (the “Registration Rights”).


 


SECTION 2.         ISSUER REGISTRATION STATEMENT


 


Anything
contained herein to the contrary notwithstanding, in the event that the
Redemption Shares are issued by the Company to a Holder pursuant to an
effective registration statement (an “Issuer Registration Statement”) filed
with the Securities and Exchange Commission (the “Commission”), the Company
shall be deemed to have satisfied all of its registration obligations under
this Agreement with respect to such Holder.


 


SECTION 3.         DEMAND REGISTRATION RIGHTS


 


3.1  (a) 
Registration
Procedure.  Unless such Redemption Shares are issued
pursuant to an Issuer Registration Statement as provided in Section 2
hereof, then


 

















 


subject to Sections
3.1(c) and 3.2 hereof, if any Holder desires to exercise its Registration
Rights with respect to the Redemption Shares held by such Holder, such Holder
(a “Notice Holder”) shall deliver to the Company written notice (a
“Registration Notice”) informing the Company of such exercise and specifying
the number of shares to be offered by such Notice Holder (such shares to be
offered being referred to herein as the “Registrable Securities”), which shares
shall not be less than (a) 1,000,000 shares or (b) all of the shares held by
such Holder.  Such notice may be given
at any time on or after the date a notice of redemption is delivered by the
Notice Holder to the Partnership pursuant to the Partnership Agreement, but
must be given at least fifteen (15) Business Days prior to the consummation of
the sale of Registrable Securities.  As
used in this Agreement, a “Business Day” is any Monday, Tuesday, Wednesday,
Thursday or Friday other than a day on which banks and other financial institutions
are authorized or required to be closed for business in the State of New York
or Maryland.  Upon receipt of the
Registration Notice, the Company, if it has not already caused the Registrable
Securities of the Notice Holder to be included as part of an existing shelf
registration statement (prior to the filing of which the Company shall have
given ten (10) Business Days’ notice to the Holders) and related prospectus
that the Company then has on file with the Commission (the “Shelf Registration
Statement”) (in which event the Company shall be deemed to have satisfied its
registration obligation under this Section 3), will cause to be filed with
the Commission as soon as reasonably practicable after receiving the
Registration Notice a new registration statement and related prospectus (a “New
Registration Statement”) that complies as to form in all material respects with
applicable Commission rules providing for the sale by the Notice Holder of the
Registrable Securities, and agrees (subject to Section 3.2 hereof) to use
its best efforts to cause such New Registration Statement to be declared
effective by the Commission as soon as practicable.  (As used herein, “Registration Statement” and “Prospectus” refer
to the Shelf Registration Statement and related prospectus (including any
preliminary prospectus) or the New Registration Statement and related
prospectus (including any preliminary prospectus), whichever is utilized by the
Company to satisfy the Notice Holder’s Registration Rights pursuant to this
Section 3, including in each case any documents incorporated therein by
reference.)  Upon receipt of a
Registration Notice, the Company will provide notice to each other Holder with
respect to which it has not already satisfied its registration obligation of
its receipt of the Registration Notice and its obligations (such notice, a
“Company Notice”).  Each other Holder
shall have 10 days from the mailing of the Company Notice to such Holder to
provide to the Company notice of its intention to include all, but not less
than all, of its Registrable Securities in a Registration Statement (such other
Holder, a “Piggyback Holder” and together with the Notice Holder, a “Selling
Holder”).  In no event may a
Registration Notice be delivered more than once in any calendar year but there
shall be no other limit on the number of Registration Notices delivered or
registrations effected pursuant to this Section 3.1.  Each Holder agrees to provide in a timely
manner information regarding the proposed distribution by such Holder of the
Registrable Securities and such other information reasonably requested by the
Company in connection with the preparation of and for inclusion in the
Registration Statement.  The Company
agrees (subject to Section 3.2 hereof) to use its best efforts to keep the
Registration Statement effective (including the


 


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preparation and filing of
any amendments and supplements necessary for that purpose) until the earlier of
(i) the date on which the Selling Holders consummate the sale of all of
the Registrable Securities under the Registration Statement or (ii) the date on
which all of the Registrable Securities registered under the Registration
Statement registered are eligible for sale pursuant to Rule 144(k) (or any
successor provision) or in a single transaction pursuant to Rule 144(e) (or any
successor provision) under the Securities Act of 1933, as amended (the
“Act”).  The Company agrees to provide
to each Selling Holder a reasonable number of copies of the final Prospectus
and any amendments or supplements thereto. 
Notwithstanding the foregoing, the Company may at any time, in its sole
discretion and prior to receiving any Registration Notice from a Holder,
include all of a Holder’s Redemption Shares or any portion thereof in any Shelf
Registration Statement.  In connection
with any Registration Statement utilized by the Company to satisfy a Holder’s
Registration Rights pursuant to this Section 3, each Holder agrees that it
will respond within ten (10) Business Days to any request by the Company to
provide or verify information regarding such Holder or such Holder’s
Registrable Securities as may be required to be included in such Registration
Statement pursuant to the rules and regulations of the Commission.


 


(b)           Offers and Sales.  All
offers and sales by a Holder under the Registration Statement referred to in
this Section 3 shall be completed within the period during which the
Registration Statement is required to remain effective pursuant to
Section 3.1(a) of this Section 3, and upon expiration of such period
a Holder will not offer or sell any Registrable Securities under the
Registration Statement.  If directed by
the Company, a Holder will return all undistributed copies of the Prospectus in
its possession upon the expiration of such period.


 


(c)           Limitations on Registration
Rights.  Each exercise of a Registration Right shall
be with respect to a minimum of the lesser of (i) one million (1,000,000)
Preferred Shares or (ii) the total number of Redemption Shares held by the
exercising Holder or Holders at such time plus the number of Redemption Shares
that may be issued upon redemption of Units by such Holder or Holders.  The right of a Holder to deliver a
Registration Notice commences upon the first date such Holder is permitted to
redeem Units pursuant to the Partnership Agreement and such Holder’s Limited
Partner Acceptance of Partnership Agreement. 
The right of a Holder to deliver a Registration Notice shall expire on
the date on which all of the Redemption Shares held by such Holder or issuable
upon redemption of Units held by such Holder are eligible for sale pursuant to
Rule 144(k) (or any successor provision) or in a single transaction pursuant to
Rule 144(e) (or any successor provision) under the Act.  Upon the exercise of the Registration Rights
granted pursuant to this Section 3.1, the holder may request an
underwritten public offering; provided,
that the Company shall have the right to select the underwriter or underwriters
in connection with such public offering, which shall be subject to the
reasonable approval of the Holder.


 


3.2  Suspension
of Offering.  Upon any notice
by the Company, either before or after a Holder has delivered a Registration
Notice, that a negotiation or


 


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consummation of a
transaction by the Company or any of its subsidiaries is pending or an event
has occurred, which negotiation, consummation or event would require additional
disclosure by the Company in a Registration Statement of material information which
the Company has a bona fide business purpose for keeping confidential and the
nondisclosure of which in the Registration Statement might cause the
Registration Statement to fail to comply with applicable disclosure
requirements (a “Materiality Notice”), a Holder agrees that it will immediately
discontinue offers and sales of the Registrable Securities under the
Registration Statement until such Holder receives copies of a supplemented or
amended Prospectus that corrects the misstatement(s) or omission(s) referred to
above and receives notice that any post-effective amendment has become
effective; provided, that the
Company may delay, suspend or withdraw the Registration Statement for such
reason for no more than sixty (60) days after delivery of the Materiality
Notice at any one time. If so directed by the Company, a Holder will deliver to
the Company all copies of the Prospectus covering the Registrable Securities
current at the time of receipt of any Materiality Notice.


 


3.3  Qualification.  The Company agrees to use its
best efforts to register or qualify the Registrable Securities by the time the
applicable Registration Statement is declared effective by the Commission under
all applicable state securities or “blue sky” laws of such jurisdictions as the
Selling Holders shall reasonably request in writing, to keep each such
registration or qualification effective during the period such Registration
Statement is required to be kept effective or during the period offers or sales
are being made by such Holder after delivery of a Registration Notice to the
Company, whichever is shorter, and to do any and all other acts and things
which may be reasonably necessary or advisable to enable the Selling Holder to
consummate the disposition in each such jurisdiction of the Registrable
Securities owned by such Holder; provided,
however, that the Company shall not be required to (x) qualify
generally to do business in any jurisdiction or to register as a broker or
dealer in such jurisdiction where it would not otherwise be required to qualify
but for this Section 3.3, (y) subject itself to taxation in any such
jurisdiction or (z) submit to the general service of process in any such
jurisdiction.


 


3.4  Registration Procedures.  Whenever the Company is required to effect the
registration of Redemption Shares under the Act pursuant to Section 3.1 of
this Agreement, subject to Section 3.2 hereof, the Company shall:


 


(a)           prepare and file with the Commission (as soon as reasonably practicable
after receiving the Registration Notice, and in any event within 60 days after
receipt of such Registration Notice) the requisite Registration Statement to
effect such registration, which Registration Statement shall comply as to form
in all material respects with the requirements of the applicable form and
include all financial statements required by the Commission to be filed
therewith, and the Company shall use its reasonable best efforts to cause such
Registration Statement to become effective; provided,
however, that before filing a Registration
Statement or Prospectus or any amendments or supplements thereto, or comparable
statements under securities or blue sky laws of any jurisdiction,


 


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the Company shall (i)
provide a Selling Holder with an adequate and appropriate opportunity to
participate in the preparation of such Registration Statement and each
Prospectus included therein (and each amendment or supplement thereto or
comparable statement) to be filed with the Commission and (ii) not file any
such Registration Statement or Prospectus (or amendment or supplement thereto
or comparable statement) with the Commission to which such Holder’s counsel or
any underwriter shall have reasonably objected on the grounds that such filing
does not comply in all material respects with the requirements of the Act or of
the rules or regulations thereunder;


 


(b)           prepare and file with the Commission such amendments and supplements to
such Registration Statement and the Prospectus used in connection therewith as
may be necessary (i) to keep such Registration Statement effective and (ii) to
comply with the provisions of the Act with respect to the disposition of the
Redemption Shares covered by such Registration Statement, in each case until
such time as all of such Redemption Shares have been disposed of in accordance
with the intended methods of disposition by the seller(s) thereof set forth in
such Registration Statement; provided,
that except with respect to any Shelf Registration, such period need not extend
beyond nine months after the effective date of the Registration Statement; and provided  further,
that with respect to any Shelf Registration, such period need not extend beyond
the time period provided in Section 3.1(a), and which periods, in any event,
shall terminate when all the Redemption Shares covered by such Registration
Statement have been sold (but not before the expiration of the time period
referred to in Section 4(3) of the Act and Rule 174 thereunder, if
applicable);


 


(c)           furnish, without
charge, to each Selling Holder and each underwriter, if any, of the securities
covered by such Registration Statement, such number of copies of such
Registration Statement, each amendment and supplement thereto (in each case
including all exhibits), and the Prospectus included in such Registration
Statement (including each preliminary Prospectus) in conformity with the
requirements of the Act, and other documents, as such Holder and such
underwriter may reasonably request in order to facilitate the public sale or
other disposition of the Redemption Shares owned by the Holder;


 


(d)           prior to any public offering of Redemption Shares, use its reasonable
best efforts to register or qualify the Redemption Shares covered by such
Registration Statement under such other securities or blue sky laws of such
jurisdictions as a Selling Holder or the sole or lead managing underwriter, if
any, may reasonably request to enable such Holder to consummate the disposition
in such jurisdictions of the Redemption Shares owned by such Holder and to
continue such registration or qualification in effect in each such jurisdiction
for as long as such Registration Statement remains in effect (including through
new filings or amendments or renewals), and do any and all other acts and things
which may be necessary or advisable to enable the Holder to consummate the
disposition in such jurisdictions of the Redemption Shares owned by it; provided,  however,
that the Company shall not be required to (i) qualify generally to do business
in any jurisdiction where it would not otherwise be required to qualify but for


 


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this Section, (ii)
subject itself to taxation in any such jurisdiction or (iii) consent to general
service of process in any such jurisdiction;


 


(e)           promptly notify each Selling Holder and the sole or lead managing
underwriter, if any: (i) when the Registration Statement, any pre-effective
amendment, the Prospectus or any prospectus supplement related thereto or
post-effective amendment to the Registration Statement has been filed, and,
with respect to the Registration Statement or any post-effective amendment,
when the same has become effective, (ii) of any request by the Commission
or any state securities or blue sky authority for amendments or supplements to
the Registration Statement or the Prospectus related thereto or for additional
information, (iii) of the issuance by the Commission of any stop order
suspending the effectiveness of the Registration Statement or the initiation or
threat of any proceedings for that purpose, (iv) of the receipt by the Company
of any notification with respect to the suspension of the qualification of any
Redemption Shares for sale under the securities or blue sky laws of any
jurisdiction or the initiation of any proceeding for such purpose, (v) of the
existence of any fact of which the Company becomes aware or the happening of
any event which results in (A) the Registration Statement containing an untrue
statement of a material fact or omitting to state a material fact required to
be stated therein or necessary to make any statements therein not misleading or
(B) the Prospectus included in such Registration Statement containing an untrue
statement of a material fact or omitting to state a material fact required to
be stated therein or necessary to make any statements therein, in the light of
the circumstances under which they were made, not misleading and (vi) of the
Company’s reasonable determination that a post-effective amendment to a
Registration Statement would be appropriate or that there exist circumstances
not yet disclosed to the public which make further sales under such
Registration Statement inadvisable pending such disclosure and post-effective
amendment; and, if the notification relates to an event described in any of the
clauses (v) or (vi) of this Section 3.4(e), subject to Section 3.2,
the Company shall promptly prepare a supplement or post-effective amendment to
such Registration Statement or related Prospectus or any document incorporated
therein by reference or file any other required document so that (1) such
Registration Statement shall not contain any untrue statement of a material
fact or omit to state a material fact required to be stated therein or
necessary to make the statements therein not misleading and (2) as thereafter
delivered to the purchasers of the Redemption Shares being sold thereunder,
such Prospectus shall not include an untrue statement of a material fact or
omit to state a material fact required to be stated therein or necessary to
make the statements therein, in the light of the circumstances under which they
were made, not misleading (and shall furnish to the Selling Holder and each
underwriter, if any, a reasonable number of copies of such Prospectus so supplemented
or amended); and if the notification relates to an event described in clauses
(ii) through (iv) of this Section 3.4(e), the Company shall use its
reasonable best efforts to remedy such matters;


 


(f)            make reasonably available for inspection by
each Selling Holder, any sole or lead managing underwriter participating in any
disposition pursuant to such Registration Statement, such Holder’s counsel and
any attorney, accountant or other


 


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agent retained by any
such seller or any underwriter material financial and other relevant
information concerning the business and operations of the Company and the
properties of the Company and any subsidiaries thereof as may be in existence
at such time as shall be necessary, in the reasonable opinion of such Holder’s
and such underwriters’ respective counsel, to enable them to conduct a
reasonable investigation within the meaning of the Act, and cause the Company’s
and any subsidiaries’ officers, directors and employees, and the independent
public accountants of the Company, to supply such information as may be
reasonably requested by any such parties in connection with such Registration
Statement;


 


(g)           obtain an opinion from the Company’s counsel and a “cold comfort” letter
from the Company’s independent public accountants who have certified the
Company’s financial statements included or incorporated by reference in such
Registration Statement in customary form and covering such matters as are
customarily covered by such opinions and “cold comfort” letters delivered to
underwriters in underwritten public offerings, which opinion and letter shall
be reasonably satisfactory to the sole or lead managing underwriter, if any,
and to each Selling Holder, and furnish to such Selling Holder participating in
the offering and to each underwriter, if any, a copy of such opinion and letter
addressed to the Holder (in the case of the opinion) and underwriter (in the
case of the opinion and the “cold comfort” letter);


 


(h)           in the case of an underwritten offering, make generally available to
its security holders as soon as practicable, but in any event not later than
eighteen months after the effective date of the Registration Statement (as
defined in Rule 158(c)), an earnings statement of the Company and its
subsidiaries (which need not be audited) complying with Section 11(a) of
the Act and the rules and regulations of the Commission thereunder (including,
at the option of the Company, Rule 158);


 


(i)            furnish to each Selling Holder and the sole
or lead managing underwriter, if any, without charge, at least one manually
signed copy of the Registration Statement and any post-effective amendments
thereto, including financial statements and schedules, all documents
incorporated therein by reference and all exhibits (including those deemed to
be incorporated by reference);


 


(j)            if requested by the sole or lead managing
underwriter or a Selling Holder, incorporate in a prospectus supplement or
post-effective amendment such information concerning such Holder, the
underwriters or the intended method of distribution as the sole or lead
managing underwriter or such Holder reasonably requests to be included therein
and as is appropriate in the reasonable judgment of the Company, including,
without limitation, information with respect to the number of Redemption Shares
being sold to the underwriters, the purchase price being paid therefor by such
underwriters and any other terms of the underwritten offering of the Redemption
Shares to be sold in such offering; and


 


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(k)           use its reasonable best efforts to take all other steps necessary to
expedite or facilitate the registration and disposition of the Redemption
Shares contemplated hereby, including obtaining necessary governmental
approvals and effecting required filings; entering into customary agreements
(including customary underwriting agreements, if the public offering is
underwritten); cooperating with the Holder and any underwriters in connection with
any filings required by the National Association of Securities Dealers, Inc.
(the “NASD”); providing appropriate certificates not bearing restrictive
legends representing the Redemption Shares; and providing a CUSIP number and
maintaining a transfer agent and registrar for the Redemption Shares.


 


3.5  Indemnification
by the Company.  The Company
agrees to indemnify and hold harmless each Selling Holder and each person, if
any, who controls such Holder within the meaning of Section 15 of the Act
or Section 20 of the Securities Exchange Act of 1934, as amended (the
“Exchange Act”), as follows:


 


(i)            against any and all loss, liability, claim,
damage and expense whatsoever, as incurred, arising out of or based upon any
untrue statement or alleged untrue statement of a material fact contained in
any Registration Statement (or any amendment thereto) pursuant to which the
Registrable Securities were registered under the Act, including all documents
incorporated therein by reference, or the omission or alleged omission
therefrom of a material fact required to be stated therein or necessary to make
the statements therein not misleading or arising out of or based upon any
untrue statement or alleged untrue statement of a material fact contained in
any Prospectus (or any amendment or supplement thereto), including all
documents incorporated therein by reference, or the omission or alleged
omission therefrom of a material fact necessary in order to make the statements
therein, in the light of the circumstances under which they were made, not
misleading;


 


(ii)           against any and all loss, liability, claim, damage and expense
whatsoever, as incurred, to the extent of the aggregate amount paid in
settlement of any litigation, or investigation or proceeding by any
governmental agency or body, commenced or threatened, or of any claim
whatsoever based upon any such untrue statement or omission, or any such
alleged untrue statement or omission, if such settlement is effected with the
written consent of the Company; and


 


(iii)          against any and all
expense whatsoever, as incurred (including reasonable fees and disbursements of
counsel), reasonably incurred in investigating, preparing or defending against
any litigation, or investigation or proceeding by any governmental agency or
body, commenced or threatened, in each case whether or not a party, or any
claim whatsoever based upon any such untrue statement or omission, or


 


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any such alleged untrue
statement or omission, to the extent that any such expense is not paid under
subparagraph (i) or (ii) above;


 


provided,
however, that the
indemnity provided pursuant to this Section 3.5 does not apply with
respect to any loss, liability, claim, damage or expense to the extent arising
out of (A) any untrue statement or omission or alleged untrue statement or
omission made in reliance upon and in conformity with written information
furnished to the Company by a Holder expressly for use in the Registration
Statement (or any amendment thereto) or the Prospectus (or any amendment or
supplement thereto) or (B) a Holder’s failure to deliver an amended or
supplemental Prospectus provided to such Holder by the Company if such loss,
liability, claim, damage or expense would not have arisen had such delivery
occurred.


 


3.6  Indemnification
by the Holder.  Each Holder
(and each permitted assignee of the Holder, on a several basis) agrees to
indemnify and hold harmless the Company, and each of its trustees/directors and
officers (including each trustee/director and officer of the Company who signed
a Registration Statement), and each person, if any, who controls the Company
within the meaning of Section 15 of the Act or Section 20 of the
Exchange Act, as follows:


 


(i)            against any and all loss, liability, claim, damage
and expense whatsoever, as incurred, arising out of or based upon any untrue
statement or alleged untrue statement of a material fact contained in any
Registration Statement (or any amendment thereto) pursuant to which the
Registrable Securities were registered under the Act, including all documents
incorporated therein by reference, or the omission or alleged omission
therefrom of a material fact required to be stated therein or necessary to make
the statements therein not misleading or arising out of or based upon any
untrue statement or alleged untrue statement of a material fact contained in
any Prospectus (or any amendment or supplement thereto), including all
documents incorporated therein by reference, or the omission or alleged
omission therefrom of a material fact necessary in order to make the statements
therein, in the light of the circumstances under which they were made, not
misleading;


 


(ii)           against any and all loss, liability, claim, damage and expense
whatsoever, as incurred, to the extent of the aggregate amount paid in
settlement of any litigation, or investigation or proceeding by any
governmental agency or body, commenced or threatened, or of any claim
whatsoever based upon any such untrue statement or omission, or any such
alleged untrue statement or omission, if such settlement is effected with the
written consent of such Holder; and


 


(iii)          against any and all expense whatsoever, as incurred (including
reasonable fees and disbursements of counsel), reasonably incurred in
investigating, preparing or defending against any litigation, or investigation
or proceeding by any governmental agency or body,


 


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commenced
or threatened, in each case whether or not a party, or any claim whatsoever
based upon any such untrue statement or omission, or any such alleged untrue
statement or omission, to the extent that any such expense is not paid under
subparagraph (i) or (ii) above;


 


provided,
however, that the
indemnity provided pursuant to this Section 3.6 shall only apply with
respect to any loss, liability, claim, damage or expense to the extent arising
out of (A) any untrue statement or omission or alleged untrue statement or
omission made in reliance upon and in conformity with written information
furnished to the Company by such Holder expressly for use in the Registration
Statement (or any amendment thereto) or the Prospectus (or any amendment or
supplement thereto) or (B) such Holder’s failure to deliver an amended or
supplemental Prospectus provided to such Holder by the Company if such loss,
liability, claim, damage or expense would not have arisen had such delivery
occurred.  Notwithstanding the
provisions of this Section 3.6, a Holder and any permitted assignee shall
not be required to indemnify the Company, its officers, trustees/directors or
control persons with respect to any amount in excess of the amount of the total
proceeds to such Holder or such permitted assignee, as the case may be, from
sales of the Registrable Securities of such Holder under the Registration
Statement.


 


3.7  Conduct
of Indemnification Proceedings. 
An indemnified party hereunder shall give reasonably prompt notice to
the indemnifying  party of any action or
proceeding commenced against it in respect of which indemnity may be sought
hereunder, but failure to so notify the indemnifying party (i) shall not
relieve it from any liability which it may have under the indemnity agreement
provided in Section 3.5 or 3.6 above, unless and to the extent it did not
otherwise learn of such action and the lack of notice by the indemnified party
results in the forfeiture by the indemnifying party of substantial rights and
defenses, and (ii) shall not, in any event, relieve the indemnifying party from
any obligations to the indemnified party other than the indemnification
obligation provided under Section 3.5 or 3.6 above.  If the indemnifying party so elects within a
reasonable time after receipt of such notice, the indemnifying party may assume
the defense of such action or proceeding at such indemnifying party’s own
expense with counsel chosen by the indemnifying party and approved by the
indemnified party, which approval shall not be unreasonably withheld; provided, however, that the indemnifying
party will not settle any such action or proceeding without the written consent
of the indemnified party unless, as a condition to such settlement, the
indemnifying party secures the unconditional release of the indemnified party;
and provided further, that if the
indemnified party reasonably determines that a conflict of interest exists
where it is advisable for the indemnified party to be represented by separate
counsel or that, upon advice of counsel, there may be legal defenses available
to it which are different from or in addition to those available to the
indemnifying party, then the indemnifying party shall not be entitled to assume
such defense and the indemnified party shall be entitled to separate counsel at
the indemnifying party’s expense.  If
the indemnifying party is not entitled to assume the defense of such action or proceeding
as a result of the second proviso to the preceding sentence, the indemnifying
party’s counsel shall be entitled to conduct the indemnifying party’s defense
and counsel for the indemnified party shall be entitled to conduct the defense
of the indemnified party, it being understood that both such counsel will
cooperate with each other to conduct the defense of such action or


 


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proceeding as efficiently
as possible.  If the indemnifying party
is not so entitled to assume the defense of such action or does not assume such
defense, after having received the notice referred to in the first sentence of
this paragraph, the indemnifying party will pay the reasonable fees and
expenses of counsel for the indemnified party. 
In such event, however, the indemnifying party will not be liable for
any settlement effected without the written consent of the indemnifying party.  If an indemnifying party is entitled to
assume, and assumes, the defense of such action or proceeding in accordance
with this paragraph, the indemnifying party shall not be liable for any fees
and expenses of counsel for the indemnified party incurred thereafter in
connection with such action or proceeding.


 


3.8  Contribution.  In order to provide for just and equitable
contribution in circumstances in which the indemnity agreement provided for in
Sections 3.5 and 3.6 above is for any reason held to be unenforceable by the
indemnified party although applicable in accordance with its terms, the Company
and each Holder shall contribute to the aggregate losses, liabilities, claims,
damages and expenses of the nature contemplated by such indemnity agreement
incurred by the Company and the Holders (i) in such proportion as is
appropriate to reflect the relative fault of the Company on the one hand and
the Holders on the other, in connection with the statements or omissions which
resulted in such losses, claims, damages, liabilities or expenses or (ii) if the
allocation provided by clause (i) above is not permitted by applicable law, in
such proportion as is appropriate to reflect not only the relative fault of,
but also the relative benefits to, the Company on the one hand and the Holders
on the other, in connection with the statements or omissions which resulted in
such losses, claims, damages, liabilities or expenses, as well as any other
relevant equitable considerations.  The
relative benefits to the indemnifying party and indemnified party shall be
determined by reference to, among other things, the total proceeds received by
the indemnifying party and indemnified party in connection with the offering to
which such losses, claims, damages, liabilities or expenses relate.  The relative fault of the indemnifying party
and indemnified party shall be determined by reference to, among other things,
whether the action in question, including any untrue or alleged untrue
statement of a material fact or omission or alleged omission to state a
material fact, has been made by, or relates to information supplied by, the
indemnifying party or the indemnified party, and the parties’ relative intent,
knowledge, access to information and opportunity to correct or prevent such
action.


 


The
parties hereto agree that it would not be just or equitable if contribution
pursuant to this Section 3.8 were determined by pro rata allocation or by
any other method of allocation which does not take account of the equitable
considerations referred to in the immediately preceding paragraph.  Notwithstanding the provisions of this
Section 3.8, no Holder shall be required to contribute any amount in
excess of the amount of the total proceeds to such Holder from sales of the
Registrable Securities of such Holder under the Registration Statement.


 


Notwithstanding
the foregoing, no person guilty of fraudulent misrepresentation (within the
meaning of Section 11(f) of the Act) shall be entitled to contribution
from any person who was not guilty of such fraudulent misrepresentation.


 


11

















 


For purposes of this
Section 3.8, each person, if any, who controls a Holder within the meaning
of Section 15 of the Act shall have the same rights to contribution as the
Holder controlled by such persons, and each trustee/director of the Company,
each officer of the Company who signed a Registration Statement and each
person, if any, who controls the Company within the meaning of Section 15
of the Act shall have the same rights to contribution as the Company.


 


SECTION 4.         EXPENSES


 


The
Company shall pay all expenses incident to the performance by the company of
the Company’s registration obligations under Section 2 and 3 hereof,
including, without limitation, (i) all Commission and state securities
registration, listing and filing fees; (ii) all expenses incurred in connection
with the preparation, printing and distribution of any Issuer Registration
Statement or Registration Statement and Prospectus; (iii) all fees and
disbursements of counsel for the Company and of the independent accountants of
the Company (including, without limitation, the expenses of any annual or
special audit and comfort letters reasonably required by the underwriters in an
underwritten offering), but excluding underwriting discounts and commissions
and transfer taxes, if any, relating to the sale or disposition of Registrable
Securities by a Holder and (iv) fees and expenses of any other persons retained
by the Company in connection with the registration, including any experts,
transfer agent or registrar, retained by the Company.


 


SECTION 5.         RULE 144 COMPLIANCE


 


The
Company covenants that it will use its best efforts to timely file the reports
required to be filed by the Company under the Act and the Exchange Act so as to
enable a Holder to sell Registrable Securities pursuant to Rule 144 under the
Act.  In connection with any sale,
transfer or other disposition by a Holder of any Registrable Securities
pursuant to Rule 144 under the Act, the Company shall cooperate with such
Holder to facilitate the timely preparation and delivery of certificates
representing Registrable Securities to be sold and not bearing any Act legend,
and enable certificates for such Registrable Securities to be for such number
of shares and registered in such names as such Holder may reasonably request at
least ten (10) Business Days prior to any sale of Registrable Securities
hereunder.


 


SECTION 6.         MISCELLANEOUS


 


6.1  Integration;
Amendment.  This Agreement
constitutes the entire agreement among the parties hereto with respect to the
matters set forth herein and supersedes and renders of no force and effect all
prior oral or written agreements, commitments and understandings among the
parties with respect to the matters set forth herein. Except as otherwise
expressly provided in this Agreement, no amendment, modification or discharge
of this Agreement shall be valid or binding unless set forth in writing and
duly executed by the Company and a majority of the Holders.


 


12

















 


6.2  Waivers.  No waiver by a party hereto shall be
effective unless made in a written instrument duly executed by the party
against whom such waiver is sought to be enforced, and only to the extent set
forth in such instrument.  Neither the
waiver by any of the parties hereto of a breach or a default under any of the
provisions of this Agreement, nor the failure of any of the parties, on one or
more occasions, to enforce any of the provisions of this Agreement or to
exercise any right or privilege hereunder shall thereafter be construed as a
waiver of any subsequent breach or default of a similar nature, or as a waiver
of any such provisions, rights or privileges hereunder.


 


6.3  Assignment;
Successors and Assigns.  This
Agreement and the rights granted hereunder may not be assigned by a Holder
without the written consent of the Company; provided,
however, that a Holder may assign its rights and obligations
hereunder without the consent of the Company, following at least ten (10) days’
prior written notice to the Company, (i) to not more than ten direct equity
owners (e.g., partners or
members) or beneficiaries in connection with a distribution of such Holder’s
Units to its equity owners or beneficiaries and (ii) to a permitted transferee
in connection with a transfer of all or a portion of the Holder’s Units in
accordance with the terms of the Partnership Agreement, if, in the case of (i)
and (ii) above, such persons agree in writing to be bound by all of the
provisions hereof.  This Agreement shall
inure to the benefit of and be binding upon the successors and permitted
assigns of all of the parties hereto.


 


6.4  Burden
and Benefit.  This Agreement
shall be binding upon and inure to the benefit of the parties hereto and their
respective heirs, executors, personal and legal representatives, successors
and, subject to Section 6.3 above, assigns.


 


6.5  Notices.  All notices called for under this Agreement
shall be in writing and shall be deemed given upon receipt if delivered
personally or by facsimile transmission and followed promptly by mail, or
mailed by registered or certified mail (return receipt requested), postage
prepaid, to the parties at the addresses set forth below their names in
Schedule A hereto, or to any other address or addressee as any party entitled
to receive notice under this Agreement shall designate, from time to time, to
the others in the manner provided in this Section 6.5 for the service of
notices; provided, however, that
notices of a change of address shall be effective only upon receipt thereof.  Any notice delivered to the party hereto to
whom it is addressed shall be deemed to have been given and received on the day
it was received; provided, however,
that if such day is not a Business Day then the notice shall be deemed to have
been given and received on the Business Day next following such day and if any
party rejects delivery of any notice attempted to be given hereunder, delivery
shall be deemed given on the date of such rejection.  Any notice sent by facsimile transmission shall be deemed to have
been given and received on the Business Day next following the transmission.


 


6.6  Specific
Performance.  The parties
hereto acknowledge that the obligations undertaken by them hereunder are unique
and that there would be no adequate remedy at law if either party fails to
perform any of its obligations hereunder,


 


13

















 


and accordingly agree
that each party, in addition to any other remedy to which it may be entitled at
law or in equity, shall be entitled to (i) compel specific performance of the
obligations, covenants and agreements of the other party under this Agreement
in accordance with the terms and conditions of this Agreement and (ii) obtain
preliminary injunctive relief to secure specific performance and to prevent a
breach or contemplated breach of this Agreement in any court of the United
States or any State thereof having jurisdiction.


 


6.7  Governing
Law.  This Agreement, the
rights and obligations of the parties hereto, and any claims or disputes
relating thereto, shall be governed by and construed in accordance with the
laws of the State of New York, but not including the choice of law rules
thereof.


 


6.8  Headings.  Section and subsection headings
contained in this Agreement are inserted for convenience of reference only,
shall not be deemed to be a part of this Agreement for any purpose, and shall
not in any way define or affect the meaning, construction or scope of any of
the provisions hereof.


 


6.9  Pronouns.  All pronouns and any variations thereof
shall be deemed to refer to the masculine, feminine, neuter, singular or
plural, as the identity of the person or entity may require.


 


6.10  Execution
in Counterparts.  To
facilitate execution, this Agreement may be executed in as many counterparts as
may be required.  It shall not be
necessary that the signature of or on behalf of each party appears on each
counterpart, but it shall be sufficient that the signature of or on behalf of
each party appears on one or more of the counterparts.  All counterparts shall collectively
constitute a single agreement.  It shall
not be necessary in any proof of this Agreement to produce or account for more
than a number of counterparts containing the respective signatures of or on
behalf of both of the parties.


 


6.11  Severability.  If fulfillment of any provision of this
Agreement, at the time such fulfillment shall be due, shall transcend the limit
of validity prescribed by law, then the obligation to be fulfilled shall be
reduced to the limit of such validity; and if any clause or provision contained
in this Agreement operates or would operate to invalidate this Agreement, in
whole or in part, then such clause or provision only shall be held ineffective,
as though not herein contained, and the remainder of this Agreement shall
remain operative and in full force and effect.


 


14

















 


IN
WITNESS WHEREOF, each of the parties hereto has caused this Agreement to be
duly executed on its behalf as of the date first hereinabove set forth.


 


 


	
   

  	
  VORNADO REALTY TRUST

  
	
   

  	
   

  
	
   

  	
  By

  	
    /s/ Joseph
  Macnow

  
	
   

  	
   

  	
  Name:

  	
  Joseph Macnow

  
	
   

  	
   

  	
  Title:

  	
  Executive Vice
  President –

  Finance and Administration and

  Chief Financial Officer

  
	
   

  	
   

  
	
   

  	
  BEL HOLDINGS LLC

  
	
   

  	
   

  
	
   

  	
  By

  	
    /s/ William
  R. Cross

  
	
   

  	
   

  	
  Name:

  	
  William R. Cross

  
	
   

  	
   

  	
  Title:

  	
  Vice President

  



 

















 


Schedule A


 


	
  Vornado Realty Trust

  
	
  888 Seventh Avenue

  
	
  New York, New York
  10014

  
	
  Attention:

  	
  Executive Vice
  President – Finance and Administration

  and Chief Financial Officer

  
	
  Facsimile:

  	
  (212) 894-9000

  
	
   

  
	
  Bel Holdings LLC

  
	
   

  
	
  c/o Eaton Vance
  Management

  
	
  The Eaton Vance
  Building

  
	
  255 State Street

  
	
  Boston, Massachusetts
  02109

  
	
  Attention:

  	
  Mr. William R. Cross

  
	
  Facsimile:

  	
  (617) 338-8054