Document:

Exhibit
10.5

 

 

Third Amendment to the

 

First Amended and Restated Agreement

 

of Limited Partnership

 

of

 

SL Green Operating Limited Partnership, L.P.

 

This Amendment is
made as of December 12, 2003 by SL Green Realty Corp., a Maryland
corporation, as managing general partner (the “Company” or the “Managing
General Partner”) of SL Green Operating Limited Partnership, L.P., a
Delaware limited partnership (the “Partnership”), and as
attorney-in-fact for the Persons named on Exhibit A to the First Amended
and Restated Agreement of Limited Partnership of SL Green Operating Limited
Partnership, dated as of August 20, 1997, as amended from time to time,
(the “Partnership Agreement”) for the purpose of amending the
Partnership Agreement.  Capitalized
terms used herein and not defined shall have the meanings given to them in the
Partnership Agreement.

 

WHEREAS, the Board
of Directors of the Company (the “Board”), by action at a meeting on
December 1, 2003 and by action of the Pricing Committee of the Board on
December 3, 2003 pursuant to delegated authority, classified and designated
6,440,000 shares of Preferred Stock (as defined in the Articles of
Incorporation of the Company (the “Charter”)) as Series C Preferred
Stock (as defined below);

 

WHEREAS,
the Board filed Articles Supplementary to the Charter (the “Articles
Supplementary”) with the State Department of Assessments and Taxation of
Maryland on December 10, 2003, establishing the Series C Preferred
Stock, with such preferences, rights, voting powers, restrictions, limitations
as to distributions, qualifications and terms and conditions of redemption as
described in the Articles Supplementary;

 

WHEREAS, on
December 12, 2003, the Company issued 6,300,000 shares of the
Series C Preferred Stock;

 

WHEREAS, the
Managing General Partner has determined that, in connection with the issuance
of the Series C Preferred Stock, it is necessary and desirable to amend
the Partnership Agreement to create additional Partnership Units (as defined in
the Partnership Agreement) having designations, preferences and other rights
which are substantially the same as the economic rights of the Series C
Preferred Stock.

 

NOW, THEREFORE, in
consideration of the premises and for other good and valuable consideration,
the receipt and sufficiency of which hereby are acknowledged, the Managing
General Partner hereby amends the Partnership Agreement as follows:

 

1.                                       Article 1
of the Partnership Agreement is hereby amended by adding the following
definitions:

 

“Series C
Preferred Stock” means the 7.625% Series C Cumulative Redeemable
Preferred Stock of the Company, with such preferences, rights, voting powers,
restrictions, limitations as to distributions, qualifications and terms and
conditions of redemption as described in the Articles Supplementary; and

 

 

“Series C
Preferred Units” means the series of Partnership Units established pursuant
to this Amendment, representing units of Limited Partnership Interest
designated as the 7.625% Series C Cumulative Redeemable Preferred Units,
with the preferences, rights, voting powers, restrictions, limitations as to
distributions, qualifications and terms and conditions of redemption of units
as described herein; and

 

2.                                       In
accordance with Section 4.02.A of the Partnership Agreement, set forth
below are the terms and conditions of the Series C Preferred Units hereby
established and issued to the Company in consideration of the Company’s
contribution to the Partnership of the net proceeds following the issuance and
sale of the Series C Preferred Stock by the Company:

 

A.                                   Designation
and Number.  A series of Partnership Units, designated as
Series C Preferred Units, is hereby established.  The number of Series C Preferred Units shall be 6,440,000.

 

B.                                     Rank.  The
Series C Preferred Units, with respect to rights to the payment of
dividends and the distribution of assets upon the liquidation, dissolution or
winding up of the Partnership, rank (a) senior to the Class A Units,
Class B Units and all Partnership Interests issued by the Partnership the
terms of which specifically provide that such Partnership Interests rank junior
to the Series C Preferred Units; (b) on a parity with all other
Partnership Interests issued by the Partnership the terms of which specifically
provide that such Partnership Interests rank on a parity with the Series C
Preferred Units; and (c) junior to all Partnership Interests issued by the
Partnership the terms of which specifically provide that such Partnership
Interests rank senior to the Series C Preferred Units.

 

C.                                     Distributions.

 

(i)                                     Pursuant
to Section 5.01 of the Partnership Agreement but subject to the rights of
holders of any Units ranking senior to the Series C Preferred Units as to
the payment of distributions, the Managing General Partner, in its capacity as
the holder of the then outstanding Series C Preferred Units, shall be
entitled to receive, when, as and if authorized by the Managing General
Partner, out of Available Cash, cumulative quarterly preferential cash
distributions in an amount per unit equal to 7.625% of the $25.00 liquidation
preference per annum (equivalent to a fixed annual amount of $1.90625 per
unit).  Distributions on the
Series C Preferred Units shall accrue and be fully cumulative from the
date of original issuance and shall be payable quarterly when, as and if
authorized by the Managing General Partner, in equal amounts in arrears on the
fifteenth day of each April, July, October and January or, if not a business
day, the next succeeding business day (each, a “Series C Preferred Unit
Distribution Payment Date”).  Any
distribution (including the initial distribution) payable on the Series C
Preferred Units for any partial distribution period shall be prorated and
computed on the basis of a 360-day year consisting of twelve 30-day
months.  Distribution period shall mean
the period from and the date of original issuance and ending on and excluding
the next Series C Preferred Unit Distribution Payment Date, and each
subsequent period from but including such Series C Preferred Unit
Distribution Payment Date and ending on and excluding the next following
Series C Preferred Unit Distribution Payment Date.

 

(ii)                                  No
distribution on the Series C Preferred Units shall be authorized by the
Managing General Partner or declared or paid or set apart for payment by the
Partnership at such time as the terms and provisions of any agreement of the
Managing General Partner or the Partnership, including any agreement relating
to its indebtedness, prohibits such authorization, declaration, payment or
setting apart for payment or provides that such authorization, declaration,
payment or setting apart for payment would constitute a breach thereof, or a
default thereunder, or if such authorization, declaration, payment or setting
apart for payment shall be restricted or prohibited by law.  No interest, or sum of money in lieu of
interest, shall be payable in respect of any distribution payment or payments
on the Series C Preferred Units which may be in arrears.

 

2

 

Notwithstanding
the foregoing, distributions with respect to the Series C Preferred Units
shall accumulate whether or not any of the foregoing restrictions exist,
whether or not there is sufficient Available Cash for the payment thereof and
whether or not such distributions are authorized.  Accumulated but unpaid distributions on Series C Preferred
Units shall not bear interest and holders of the Series C Preferred Units
shall not be entitled to any distributions in excess of full cumulative
distributions.  Any distribution payment
made on the Series C Preferred Units shall first be credited against the
earliest accumulated but unpaid distribution due with respect to such units
which remains payable.

 

(iii)                               Except
as provided in subsection 2.C.(iv), unless full cumulative distributions have
been or contemporaneously are declared and paid or authorized, declared and a
sum sufficient for the payment thereof set apart for such payment on the
Series C Preferred Units for all past distribution periods and the then
current distribution period, no distributions (other than in Partnership
Interests ranking junior to the Series C Preferred Units as to the payment
of dividends and the distribution of assets upon any liquidation, dissolution
or winding up of the Partnership) shall be authorized, declared or paid or set
apart for payment nor shall any other distribution be authorized, declared or
made upon the Class A Units, the Class B Units, or any other
Partnership Interests ranking, as to the payment of distributions or the distribution
of assets upon any liquidation, dissolution or winding up of the Partnership,
junior to or on a parity with the Series C Preferred Units for any period,
nor shall any Class A Units, Class B Units, or any other Partnership
Interests ranking junior to or on a parity with the Series C Preferred
Units as to the payment of distributions or the distribution of assets upon any
liquidation, dissolution or winding up of the Partnership, be redeemed,
purchased or otherwise acquired for any consideration (or any moneys be paid to
or made available for a sinking fund for the redemption of any such Partnership
Interests) by the Partnership (except by conversion into or exchange for
Partnership Interests ranking junior to the Series C Preferred Units as to
the payment of distributions and the distribution of assets upon any
liquidation, dissolution or winding up of the affairs of the Partnership).

 

(iv)                              When
distributions are not paid in full (or a sum sufficient for such full payment
is not so set apart) upon the Series C Preferred Units and any other
Partnership Interests ranking on a parity as to the payment of distributions
with the Series C Preferred Units, all distributions authorized and
declared upon the Series C Preferred Units and any other Partnership Interests
ranking on a parity as to the payment of distributions with the Series C
Preferred Units shall be declared pro rata so that the amount of distributions
authorized and declared per Series C Preferred Unit and such other
Partnership Interests shall in all cases bear to each other the same ratio that
accumulated distributions per each Series C Preferred Unit and such other
Partnership Interests (which shall not include any accumulation in respect of
unpaid distributions for prior distribution periods if such other Partnership
Interests do not have a cumulative distribution) bear to each other.

 

(v)                                 Holders
of Series C Preferred Units shall not be entitled to any distribution,
whether payable in cash, property or Partnership Interests, in excess of full
cumulative distributions on the Series C Preferred Units as described
above.  Accrued but unpaid distributions
on the Series C Preferred Units will accumulate as of the Series C
Preferred Units Distribution Payment Date on which they first become payable.

 

D.                                    Allocations.

 

Allocations
of the Partnership’s items of income, gain, loss and deduction shall be
allocated among holders of Series C Preferred Units in accordance with
Article VI of the Partnership Agreement.

 

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E.                                      Liquidation
Preference.

 

(i)                                     In
the event of any voluntary or involuntary liquidation, dissolution or winding
up of the Partnership, the Managing General Partner, in its capacity as holder
of the Series C Preferred Units, shall be entitled to receive out of the
assets of the Partnership available for distribution to the Partners pursuant
to Section 13.02.A of the Partnership Agreement a liquidation preference
of $25.00 per Series C Preferred Unit, plus an amount equal to any
accumulated and unpaid distributions (whether or not earned or authorized) to
the date of payment, before any distribution of assets is made to holders of
Class A Units, Class B Units or any other Partnership Interests that
rank junior to the Series C Preferred Units as to the distribution of
assets upon the liquidation, dissolution or winding up of the Partnership, but
subject to the preferential rights of the holders of Partnership Interests
ranking senior to the Series C Preferred Units as to the distribution of
assets upon the liquidation, dissolution or winding up of the Partnership.

 

(ii)                                  If
upon any such voluntary or involuntary liquidation, dissolution or winding up
of the Partnership, the assets of the Partnership legally available for
distribution to its Partners are insufficient to make such full payment to the
Managing General Partner, in its capacity as the holder of the Series C
Preferred Units, and the corresponding amounts payable on all other Partnership
Interests ranking on a parity with the Series C Preferred Units as to the
distribution of assets upon the liquidation, dissolution or winding up of the
Partnership, then the Managing General Partner, in its capacity as the holder
of the Series C Preferred Units, and all other holders of such Partnership
Interests shall share ratably in any such distribution of assets in proportion
to the full liquidating distributions (including, if applicable, accumulated
and unpaid distributions) to which they would otherwise be respectively
entitled.

 

(iii)                               After
payment of the full amount of the liquidating distributions to which they are
entitled, the Managing General Partner, in its capacity as the holder of the
Series C Preferred Units, shall have no right or claim to any of the
remaining assets of the Partnership.

 

(iv)                              None
of a consolidation or merger of the Partnership with or into another entity, a
merger of another entity with or into the Partnership, a statutory unit
exchange by the Partnership or a sale, lease or conveyance of all or
substantially all of the Partnership’s property or business shall be considered
a liquidation, dissolution or winding up of the affairs of the Partnership.

 

F.                                      Redemption.

 

In
connection with the redemption by the Company of any of shares of Series C
Preferred Stock in accordance with the provisions of the Articles
Supplementary, the Partnership shall provide cash to the Company for such
purpose which shall be equal to the redemption price (as set forth in the
Articles Supplementary), plus all distributions accumulated and unpaid to the
Redemption Date (as defined in the Articles Supplementary) (or, as applicable,
the accumulated and unpaid distribution payable pursuant to
Section 6(b)(iv) of the Articles Supplementary), and one Series C
Preferred Unit shall be concurrently redeemed with respect to each share of
Series C Preferred Stock so redeemed by the Company.  From and after the applicable Redemption
Date (as defined in the Articles Supplementary), the Series C Preferred
Units so redeemed shall no longer be outstanding and all rights hereunder, to distributions
or otherwise, with respect to such Series C Preferred Units shall
cease.  Any Series C Preferred
Units so redeemed may be reissued to the Managing General Partner at such time
as the Managing General Partner reissues a corresponding number of shares of
Series C Preferred Stock so redeemed or repurchased, in exchange for the
contribution by the Managing General Partner to the Partnership of the proceeds
from such reissuance.

 

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G.                                     Voting
Rights.

 

Except
as required by applicable law, the Managing General Partner, in its capacity as
the holder of the Series C Preferred Units, shall have no voting rights.

 

H.                                    Conversion.

 

The
Series C Preferred Units are not convertible into or exchangeable for any
other property or securities of the Partnership.

 

I.                                         Restriction
on Ownership.

 

The
Series C Preferred Units shall be owned and held solely by the Managing
General Partner.

 

3.                                       Except
as modified herein, all terms and conditions of the Partnership Agreement shall
remain in full force and effect, which terms and conditions the Managing
General Partner hereby ratifies and confirms.

 

4.                                       This
Amendment shall be construed and enforced in accordance with and governed by
the laws of the State of Delaware, without regard to conflicts of law.

 

5.                                       If
any provision of this Amendment is or becomes invalid, illegal or unenforceable
in any respect, the validity, legality and enforceability of the remaining
provisions contained herein shall not be affected thereby.

 

*      *      *      *      *

 

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IN WITNESS
WHEREOF, the undersigned have executed this Amendment as of the date first set
forth above.

 

 

	
   

  	
  SL GREEN REALTY
  CORP.,

  
	
   

  	
  a Maryland
  corporation, as Managing General

  
	
   

  	
  Partner of SL
  Green Operating Limited

  
	
   

  	
  Partnership and
  on behalf of existing

  
	
   

  	
  Limited Partners

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
  Title:Exhibit 10.14

 

EMPLOYMENT AND NONCOMPETITION
AGREEMENT

 

This
EMPLOYMENT AND NONCOMPETITION AGREEMENT (“Agreement”) is made as of the 1st day
of January, 2004 between Marc Holliday (“Executive”) and SL Green Realty Corp.,
a Maryland corporation with its principal place of business at 420 Lexington
Avenue, New York, New York 10170 (the “Employer”), and amends in its entirety
and (subject to Section 3(i)) completely restates that certain employment
agreement between Executive and the Employer dated as of January 1, 2001.

 

1.     Term.  The term of
this Agreement shall commence on January 1, 2004 and, unless earlier
terminated as provided in Section 6 below, shall terminate on
January 17, 2010 (the “Current Term”);  provided, however, that Sections 4 and 8
(and any enforcement or other procedural provisions hereof affecting Sections 4
and 8) hereof shall survive the termination of this Agreement as provided
therein.  The Current Term shall
automatically be extended for successive one-year periods (each, a “Renewal Term”),
unless either party gives the other party at least three months’ written notice
of non-renewal.  The period of
Executive’s employment hereunder consisting of the Current Term and all Renewal
Terms, if any, is herein referred to as the “Employment Period.”

 

2.     Employment and Duties.

 

(a)   Duties.  During the Employment Period, Executive shall be employed in the
business of the Employer and its affiliates. 
Executive shall serve the Employer as a senior corporate executive and
shall have the title of Chief Executive Officer (“CEO”) and President of the
Employer and, for so long as so elected, member of the Board of Directors of
the Employer (the “Board”).  Executive,
as CEO and President, shall be principally responsible for all decision-making
with respect to the Employer (including with respect to the hiring and
dismissal of subordinate executives), subject to supervision in the ordinary
course by the Chairman of the Board or by the Board, it being expressly
understood and agreed that Executive will consult frequently with the Chairman
and that the Chairman may take an active role in working with Executive to
develop the policies of the Company. 
Executive’s duties and authority shall be as further set forth in the By-laws
of the Employer and as otherwise established from time to time by the Board,
but in all events such duties shall be commensurate with his position as CEO
and President of the Employer.

 

(b)   Best Efforts.  Executive agrees to his employment as
described in this Section 2 and agrees to devote substantially all of his
business time and efforts to the performance of his duties under this
Agreement, except as otherwise approved by the Board of Directors of the
Employer (the “Board”); provided, however, that nothing herein shall be
interpreted to preclude Executive, so long as there is no material interference
with his duties hereunder, from (i) participating as an officer or director of,
or advisor to, any charitable or other tax-exempt organizations or otherwise
engaging in charitable, fraternal or trade group activities; (ii) investing and managing his assets as a passive
investor in other entities or business ventures; provided that he performs no
management or similar role (or, in the case of investments other than real
estate investments, he performs a management role comparable to the role that a
significant limited partner would have, but performs no day-to-day management
or similar role) with respect to such entities or ventures and such investment
does not violate Section 8 hereof; and provided, further, that, in any
case in which another party involved in the investment has a material business
relationship with the

 

 

Employer,
Executive shall give prior written notice thereof to the Board; or (iii)
serving as a member of the Board of Directors of a for-profit corporation with
the approval of the Board.

 

(c)   Travel.  In performing his duties hereunder, Executive shall be available
for all reasonable travel as the needs of the Employer’s business may
require.  Executive shall be based in New
York City or Westchester County, or within 25 miles of Manhattan but not in New
Jersey or Long Island.

 

3.     Compensation and Benefits.  In consideration of Executive’s services hereunder, the Employer
shall compensate Executive as provided in this Agreement.

 

(a)   Base Salary.  The Employer shall pay Executive an aggregate minimum annual
salary at the rate of $600,000 per annum during the Employment Period (“Base
Salary”).  Base Salary shall be adjusted
upwards by the Board, at least once every two years, to correspond to increases
(if any) in the New York City metropolitan area Consumer Price Index.  Base Salary shall be payable bi-weekly in
accordance with the Employer’s normal business practices and shall be reviewed
by the Board or Compensation Committee at least annually.

 

(b)   Incentive Compensation/Bonuses.  In addition to Base Salary, during the
Employment Period, Executive shall be eligible for and shall receive such
discretionary annual bonuses as the Board, in its sole discretion, may deem
appropriate to reward Executive for job performance.  In the event of a Change-in-Control (as defined below), the
minimum bonus for fiscal years ending after the Change-in-Control shall be
$600,000.  Upon the execution hereof,
(i) Executive shall also be granted a signing bonus of 95,000 restricted shares
of the Employer’s common stock (“Common Stock”) which will be fully vested upon
grant and which will be subject to a prohibition from any disposition,
alienation, etc. for a period of two years from the date of grant, and (ii) the
Employer shall pay Executive an additional cash amount, intended to serve
generally as a tax gross-up equal to 40% of the value of the shares then
included in Executive’s taxable income. 
In addition, Executive shall be eligible to participate in any other
bonus or incentive compensation plans in effect with respect to senior
executive officers of the Employer, as the Board, in its sole discretion, may
deem appropriate to reward Executive for job performance.  Executive
shall be eligible to participate in the SL Green Realty Corp. 2003
Long-Term Outperformance Compensation Program, as amended December 2003 (the “Outperformance Plan”), subject to the
terms and conditions as set forth in the Employer’s Outperformance Plan.  It is expressly understood that, with
respect to awards under the Outperformance Plan, the provisions of the
Outperformance Plan, as amended from time to time, and not the provisions of
this Agreement, shall govern in accordance with their terms, except with
respect to the 12 months of vesting credit provided for under the third
sentence of Section 7(a)(iii).

 

(c)   Stock Options.  As determined by the Board, in its sole
discretion, Executive shall be eligible to participate in the Employer’s then
current Stock Option and Incentive Plan (the “Plan”), which authorizes the
grant of stock options and stock awards of the Common Stock.  The Board shall review Executive’s level of
participation during the fourth quarter of each fiscal year.

 

(d)   Other Equity Awards.  Executive will be granted 175,000 restricted
shares of Common Stock, effective as of January 1, 2004, in accordance
with and subject to definitive documentation which is consistent with the terms
summarized on Exhibit A hereto and which is

 

2

 

otherwise consistent with
the Employer’s general practices for documentation contemplated by the Plan;
and the vesting provisions applicable to Executive’s existing outstanding
127,500 restricted shares which have not yet vested shall as of January 1,
2004 be as summarized on such Exhibit A (and the definitive documentation
therefor shall be amended accordingly). 
In addition, (i) the Employer shall pay Executive an additional cash
amount, intended to serve generally as a tax gross-up, upon each date on which
any such restricted shares vest and become taxable, equal to 40% of the value
of the shares included in Executive’s taxable income on such date and (ii) Executive will receive the full cash dividends
attributable to all nonforfeited shares of restricted stock, regardless of
whether such shares have become vested on the record date for such dividends.

 

(e)   Expenses.  Executive shall be reimbursed for all reasonable business related
expenses incurred by Executive at the request of or on behalf of the Employer,
provided that such expenses are incurred and accounted for in accordance with
the policies and procedures established by the Employer.  Any expenses incurred during the Employment
Period but not reimbursed by the Employer by the end of the Employment Period,
shall remain the obligation of the Employer to so reimburse Executive.

 

(f)    Health and Welfare Benefit Plans.  During the Employment Period, Executive and
Executive’s immediate family shall be entitled to participate in such health
and welfare benefit plans as the Employer shall maintain from time to time for
the benefit of senior executive officers of the Employer and their families, on
the terms and subject to the conditions set forth in such plan.  Nothing in this Section shall limit the
Employer’s right to change or modify or terminate any benefit plan or program
as it sees fit from time to time in the normal course of business so long as it
does so for all senior executives of the Employer.

 

(g)   Vacations.  Executive shall be entitled to paid vacations in accordance with
the then regular procedures of the Employer governing senior executive
officers.

 

(h)   Certain Other Benefits.  During the Employment Period, the Employer
shall provide to Executive such other benefits, as generally made available to
other senior executives of the Employer. 
In addition, the Employer shall maintain life insurance for the benefit
of Executive’s beneficiaries in a face amount equal to $10,000,000; provided,
however, that such coverage shall only be required if available to the Employer
at reasonable rates; and provided, further, that Executive cooperates as
reasonably requested by the Employer in the Employer’s efforts to obtain such
insurance.  If such insurance is not
available at reasonable rates, then the Employer shall provide such coverage on
a self-insured basis, at a cost to the Employer not to exceed the amount
Executive would receive upon a termination by the Employer without Cause (as
defined in Section 6(a)(iii) below) under Section 7(a)(ii); provided
that, for purposes of this sentence, the multiplier in clause (y) of such
Section shall be the lesser of (i) three or (ii) the number of years
(including partial years) remaining in the then current Employment Period.

 

(i)    Loans.  Any loan expressly provided for under the predecessor to this
Agreement shall continue in effect in accordance with the terms of such
predecessor applicable to such loan (including without limitation with respect
to the continuation of all provisions regarding loan forgiveness as provided in
that certain predecessor employment agreement between Executive and the
Employer dated as of January 1, 2001).

 

3

 

4.     Indemnification and Liability Insurance.  The Employer agrees to indemnify Executive
to the extent permitted by applicable law, as the same exists and may hereafter
be amended, from and against any and all losses, damages, claims, liabilities
and expenses asserted against, or incurred or suffered by, Executive (including
the costs and expenses of legal counsel retained by the Employer to defend
Executive and judgments, fines and amounts paid in settlement actually and
reasonably incurred by or imposed on such indemnified party) with respect to
any action, suit or proceeding, whether civil, criminal administrative or
investigative (a “Proceeding”) in which Executive is made a party or threatened
to be made a party, either with regard to his entering into this Agreement with
the Employer or in his capacity as an officer or director, or former officer or
director, of the Employer or any affiliate thereof for which he may serve in
such capacity.  The Employer also agrees
to secure and maintain officers and directors liability insurance providing
coverage for Executive.  The provisions
of this Section 4 shall remain in effect after this Agreement is
terminated irrespective of the reasons for termination.

 

5.     Employer’s Policies. 
Executive agrees to observe and comply with the reasonable rules and
regulations of the Employer as adopted by the Board from time to time regarding
the performance of his duties and to carry out and perform orders, directions
and policies communicated to him from time to time by the Board, so long as
same are otherwise consistent with this Agreement.

 

6.     Termination. 
Executive’s employment hereunder may be terminated under the following
circumstances:

 

(a)   Termination by the Employer.

 

(i)            Death.  Executive’s employment hereunder shall
terminate upon his death.

 

(ii)           Disability.  If, as a result of Executive’s incapacity
due to physical or mental illness or disability, Executive shall have been
incapable of performing his duties hereunder even with a reasonable
accommodation on a full-time basis for the entire period of four consecutive
months or any 120 days in a 180-day period, and within 30 days after written
Notice of Termination (as defined in Section 6(d)) is given he shall not
have returned to the performance of his duties hereunder on a full-time basis,
the Employer may terminate Executive’s employment hereunder.

 

(iii)          Cause.  The Employer may terminate Executive’s
employment hereunder for Cause by a majority vote of all members of the Board,
excluding the vote of Executive.  For
purposes of this Agreement, “Cause” shall mean:  (i) Executive’s engaging in conduct which is a felony; (ii)
Executive’s engaging in conduct constituting a material breach of fiduciary
duty, gross negligence or willful and material misconduct, material fraud or
willful and material misrepresentation; (iii) Executive’s material breach of
any of his obligations under Section 8(a) through 8(e) of this Agreement;
or (iv) Executive’s repeated failure to competently perform his duties which
failure is not cured within 30 days after receiving notice from the Employer
specifically identifying the manner in which Executive has failed to perform
(it being understood that, for this purpose, the manner and level of
Executive’s performance shall not be determined based on the financial
performance (including without limitation the performance of the stock) of the
Employer).

 

4

 

(iv)          Without Cause.  Executive’s employment hereunder may be
terminated by the Employer at any time with or without Cause (as defined in
Section 6(a)(iii) above), by a vote of
two-thirds or more of all of the members of the Board (not taking into account
Executive as a member of the Board), upon written notice to Executive,
subject only to the severance provisions specifically set forth in
Section 7.

 

(b)   Termination by Executive.

 

(i)            Disability.  Executive may terminate his employment
hereunder for Disability within the meaning of Section 6(a)(ii) above.

 

(ii)           With Good Reason.  Executive’s employment hereunder may be
terminated by Executive with Good Reason effective immediately by written
notice to the Board.  For purposes of
this Agreement, with “Good Reason” shall mean: (i) a failure of the Board to
continue Executive in any offices in accordance with the provisions of
Section 2(a) or of Executive to be continued as a member of the Board;
(ii) a failure by the Employer to pay compensation in accordance with the
provisions of Section 3, which failure has not been cured within 14 days
after the notice of the failure (specifying the same) has been given by Executive
to the Employer; (iii) a material breach by the Employer of any other provision
of this Agreement which has not been cured within 30 days after notice of
noncompliance (specifying the nature of the noncompliance) has been given by
Executive to the Employer; (iv) the relocation of the Employer’s principal
executive offices to a location not meeting the requirements of the last
sentence of Section 2(c); or (v) on and after the occurrence of a
Change-in-Control (as defined in Section 6(c) below), “Good Reason” shall
also include, in addition to the foregoing:

 

(A)          a change in duties, responsibilities,
status or positions (including without limitation the appointment of a co-CEO
or a change in Executive’s status to co-CEO) with the Employer that does not represent
a promotion from or maintaining of Executive’s duties, responsibilities, status
or positions as in effect immediately prior to the Change-in-Control, or any
removal of Executive from or any failure to reappoint or reelect Executive to
such positions, except in connection with the termination of Executive’s
employment for Cause, disability, retirement or death;

 

(B)           a reduction by the Employer in
Executive’s Base Salary or the payment of a bonus less than any minimum
required under Section 3(b);

 

(C)           the failure by the Employer to
continue in effect any of the benefit plans including, but not limited to
ongoing stock option and equity awards, in which Executive is participating at
the time of the Change-in-Control of the Employer (unless Executive is
permitted to participate in any substitute benefit plan with substantially the
same terms and to the same extent and with the same rights as Executive had
with respect to the benefit plan that is discontinued) other than as a result
of the normal expiration of any such benefit plan in accordance with its terms
as in effect at the time of the Change-in-Control, or the taking of any action,
or the failure to act, by the Employer which would adversely affect Executive’s
continued participation in any of such benefit plans

 

5

 

on at least as favorable
a basis to Executive as was the case on the date of the Change-in-Control or
which would materially reduce Executive’s benefits in the future under any of
such benefit plans or deprive Executive of any material benefits enjoyed by
Executive at the time of the Change-in-Control; provided, however, that any
such action or inaction on the part of the Employer, including any
modification, cancellation or termination of any benefits plan, undertaken in
order to maintain such plan in compliance with any federal, state or local law
or regulation governing benefits plans, including, but not limited to, the
Employment Retirement Income Security Act of 1974, shall not constitute Good
Reason for the purposes of this Agreement; and

 

(D)          the failure by the Employer to obtain
from any successor to the Employer an agreement to be bound by this Agreement
pursuant to Section 16 hereof, which has not been cured within 30 days
after the notice of the failure (specifying the same) has been given by
Executive to the Employer.

 

(iii)          Without Good Reason.  Executive shall have the right to terminate
his employment hereunder without Good Reason, subject to the terms and
conditions of this Agreement.

 

(c)   Definitions.  The following terms shall be defined as set forth below.

 

(i)            A “Change-in-Control” shall be
deemed to have occurred if:

 

(A)          any Person, together with all
“affiliates” and “associates” (as such terms are defined in Rule 12b-2 under
the Securities Exchange Act of 1934 (the “Exchange Act”)) of such Person, shall
become the “beneficial owner” (as such term is defined in Rule 13d-3 under the
Exchange Act), directly or indirectly, of securities of the Employer or SL
Green Operating Partnership, L.P. (the “OP”) representing 25% or more of either
(1) the combined voting power of the Employer’s and/or OP’s then outstanding
securities having the right to vote in an election of the Board (“Voting
Securities”) or (2) the then outstanding shares of all classes of stock of the
Employer or OP (in either such case other than as a result of the acquisition
of securities directly from the Employer or OP); or

 

(B)           the members of the Board at the
beginning of any consecutive 24-calendar-month period commencing on or after
the date hereof (the “Incumbent Directors”) cease for any reason other than due
to death to constitute at least a majority of the members of the Board;
provided that any director whose election, or nomination for election by the Employer’s
stockholders, was approved by a vote of at least a majority of the members of
the Board then still in office who were members of the Board at the beginning
of such 24-calendar-month period, shall be deemed to be an Incumbent Director;
or

 

(C)           the stockholders of the Employer
shall approve (1) any consolidation or merger of the Employer or any subsidiary
where the stockholders of the Employer, immediately prior to the consolidation
or merger, would not, immediately after the consolidation or merger, beneficially
own (as

 

6

 

such term is defined in
Rule 13d-3 under the Exchange Act), directly or indirectly, shares representing
in the aggregate at least 50% of the voting shares of the corporation issuing cash
or securities in the consolidation or merger (or of its ultimate parent
corporation, if any), (2) any sale, lease, exchange or other transfer (in one
transaction or a series of transactions contemplated or arranged by any party
as a single plan) of all or substantially all of the assets of the Employer, if
the shareholders of the Employer and unitholders of the OP taken as a whole and
considered as one class immediately before such transaction own, immediately
after consummation of such transaction, equity securities and partnership units
possessing less than 50% percent of the surviving or acquiring company and
partnership taken as a whole or (3) any plan or proposal for the liquidation or
dissolution of the Employer.

 

Notwithstanding
the foregoing, a “Change-in-Control” shall not be deemed to have occurred for
purposes of the foregoing clause (A) solely as the result of an acquisition of
securities by the Employer which, by reducing the number of shares of stock or
other Voting Securities outstanding, increases (x) the proportionate number of
shares of stock of the Employer beneficially owned by any Person to 25% or more
of the shares of stock then outstanding or (y) the proportionate voting power
represented by the Voting Securities beneficially owned by any Person to 25% or
more of the combined voting power of all then outstanding Voting Securities;
provided, however, that if any Person referred to in clause (x) or (y) of this
sentence shall thereafter become the beneficial owner of any additional stock
of the Employer or other Voting Securities (other than pursuant to a share
split, stock dividend, or similar transaction), then a “Change-in-Control”
shall be deemed to have occurred for purposes of the foregoing clause (A).

 

(ii)           “Person” shall have the meaning used
in Sections 13(d) and 14(d) of the Exchange Act; provided however, that the
term “Person” shall not include (A) Stephen L. Green, (B) Executive or (C) the
Employer, any of its subsidiaries, or any trustee, fiduciary or other person or
entity holding securities under any employee benefit plan of the Employer or
any of its subsidiaries.  In addition,
no Change-in-Control shall be deemed to have occurred under clause (i)(A) above
by virtue of a “group” (as such term is used in Sections 13(d) and 14(d) of the
Exchange Act) becoming a beneficial owner as described in such clause, if any
individual or entity described in clause (A), (B) or (C) of the foregoing
sentence is a member of such group.

 

(d)   Notice of Termination.  Any termination of Executive’s employment by
the Employer or by Executive (other than on account of death) shall be
communicated by written Notice of Termination to the other party hereto in
accordance with Section 12 of this Agreement.  For purposes of this Agreement, a “Notice of Termination” shall
mean a notice which shall indicate the specific termination provision in this
Agreement relied upon and, as applicable, shall set forth in reasonable detail
the fact and circumstances claimed to provide a basis for termination of Executive’s
employment under the provision so indicated.

 

7

 

7.     Compensation Upon Termination.

 

(a)   Termination By Employer Without Cause or
By Executive With Good Reason.  If
(x) Executive is terminated by the Employer without Cause pursuant to
Section 6(a)(iv) above, or (y) Executive shall terminate his employment
hereunder with Good Reason pursuant to Section (6)(b)(ii) above, then the
Employment Period shall terminate as of the effective date set forth in the written
notice of such termination (the “Termination Date”) and Executive shall be
entitled to the following payment and benefits:

 

(i)            Executive shall receive any earned
and accrued but unpaid Base Salary on the Termination Date, and any earned and
accrued but unpaid incentive compensation and bonuses payable at such times as
would have applied without regard to such termination.

 

(ii)           The Employer shall continue to pay
Executive’s Base Salary (at the rate in effect on the date of his termination)
and annual performance bonus (based on the average amount paid for the
immediately preceding two years) for the remaining term of the Employment
Period after the date of Executive’s termination, on the same periodic payment
dates as payment would have been made to Executive had the Employment Period
not been terminated for the remaining term of the Employment Period after the
date of Executive’s termination; provided, however, that if such termination
occurs upon or following a Change-in-Control, the Employer shall continue to
pay Executive’s Base Salary (at the rate in effect on the date of his
termination) and annual performance bonus (based on the highest amount paid for
the two preceding years) for the greater of 18 months or the remaining term of
the Employment Period after the date of Executive’s termination, on such
periodic payment dates.

 

(iii)          Executive
shall continue to receive all benefits described in Section 3(f) existing
on the date of termination for a period of three years to follow the
Termination Date, subject to the terms and conditions upon which such benefits
may be offered to continuing senior executives from time to time.  For purposes of the application of such
benefits, Executive shall be treated as if he had remained in the employ of the
Employer with a Base Salary at the rate in effect on the date of
termination.  For purposes of vesting
under the Employer’s Outperformance Plan, without limiting any other rights
that Executive may have under the Employer’s Outperformance Plan, Executive
shall be treated as if he had remained in the employ of the Employer for 12
months after the date of termination. 
Notwithstanding the foregoing, (A) nothing in this
Section 7(a)(iii) shall restrict the ability of the Employer to amend or
terminate the plans and programs governing the benefits described in
Section 3(f) from time to time in its sole discretion, and (B) the
Employer shall in no event be required to provide any benefits otherwise
required by this Section 7(a)(iii) after such time as Executive becomes
entitled to receive benefits of the same type from another employer or
recipient of Executive’s services (such entitlement being determined without
regard to any individual waivers or other similar arrangements).

 

(iv)          Any unvested shares of restricted stock
(i.e., shares then still subject to restrictions under the applicable award
agreement) granted to Executive by the Employer shall become vested (i.e., free
from such restrictions) and, as applicable, Executive shall be entitled to
receive the amount described in the last sentence of Section 3(d) (for the

 

8

 

avoidance of doubt, the
foregoing provisions of this sentence shall not refer to grants under the
Employer’s Outperformance Plan, which shall apply in accordance with its terms
as in effect from time to time), and any unexerciseable or unvested stock
options granted to Executive by the Employer shall become vested and
exercisable on the date of Executive’s termination.  Any unexercised stock options granted to Executive by the
Employer shall remain exercisable until the second January 2 to follow the
Termination Date or, if earlier, the expiration of the initial applicable term
stated at the time of the grant.

 

Other than as may be
provided under Section 3(i) or 4 or as expressly provided in this
Section 7(a), the Employer shall have no further obligations hereunder
following such termination.

 

(b)   Termination By the Employer For Cause or
By Executive Without Good Reason. 
If (i) Executive is terminated by the Employer for Cause pursuant to
Section 6(a)(iii) above, or (ii) Executive voluntarily terminates his
employment hereunder without Good Reason pursuant to Section 6(b)(ii)
above, then the Employment Period shall terminate as of the effective date set
forth in the written notice of such termination (the “Termination Date”) and
Executive shall be entitled to receive his earned and accrued but unpaid Base
Salary at the rate then in effect until the Termination Date.  In addition, in such event, Executive shall
be entitled (i) to receive any earned and accrued but unpaid incentive
compensation or bonuses, payable at such times as would have applied without
regard to such termination, except that,
notwithstanding the foregoing, no amounts shall be payable under this clause
(i) in the case of a termination by the Employer for Cause under clause (i) or
(ii) of Section 6(a)(iii) (for the avoidance of doubt, the
foregoing provisions of this clause (i) shall not refer to grants under the
Employer’s Outperformance Plan, which shall apply in accordance with its terms
as in effect from time to time),
(ii) to exercise any options which have vested as of the termination of
Executive’s employment and are exercisable to the extent provided by and
otherwise in accordance with the terms of the applicable option grant agreement
or plan, and (iii) to retain any restricted shares of the Employer’s stock
which have vested as of the termination of Executive’s employment.  Other than 
as may be provided under Section 3(i) or 4 or as expressly provided
in this Section 7(b), the Employer shall have no further obligations
hereunder following such termination.

 

(c)   Termination by Reason of Death.  If Executive’s employment terminates due to
his death, (i) the Employer shall pay Executive’s Base Salary plus any
applicable pro rata portion of the annual performance bonus described in
Section 3(b) above for a period of six months from the date of his death,
or such longer period as the Board may determine, to Executive’s estate or to a
beneficiary designated by Executive in writing prior to his death, and (ii)
such estate or beneficiary shall be entitled to any proceeds from applicable
life insurance on the life of Executive (or alternative coverage) as
contemplated by Section 3(h).  In the
case of such a termination, (i) 22,500 of the 127,500 shares of restricted
stock granted to Executive before the date hereof if then unvested shall fully
vest, and (ii) as applicable, Executive shall be entitled to receive the cash
amount described in the last sentence of Section 3(d) with respect to the
restricted shares referenced in such Section 3(d) (for the avoidance of
doubt, the foregoing clauses (i) and (ii) shall not refer to grants under the
Employer’s Outperformance Plan, which shall apply in accordance with its terms
as in effect from time to time). 
Furthermore, upon such death, any vested unexercised stock options
granted to Executive shall remain vested and

 

9

 

exercisable until the
earlier of (A) the date on which the term of such stock options otherwise would
have expired, or (B) the second January 1 after the date of Executive’s
termination due to his death.  Other
than as may be provided under Section 3(i) or 4 or as expressly provided
in this Section 7(c), the Employer shall have no further obligations
hereunder following such termination.

 

(d)   Termination by Reason of Disability.  In the event that Executive’s employment
terminates due to his disability as defined in Section 6(a)(ii) above,
Executive shall be entitled to be paid his Base Salary plus any applicable pro
rata portion of the annual performance bonus described in Section 3(b)
above for a period of six months from the date of such termination, or for such
longer period as such benefits are then provided with respect to other senior
executives of the Employer.  In the case
of such a termination, (i) Executive shall be credited with six months after
termination under any provisions governing restricted stock or options relating
to the vesting or initial exercisability thereof, except that, as to the
127,500 shares of restricted stock granted before the date hereof, such shares
shall fully vest, (ii) if such six months
of credit would fall within a vesting period, a pro rata portion of the
unvested shares of restricted stock granted to Executive that otherwise would
have become vested upon the conclusion of such vesting period shall become
vested on the date of Executive’s termination due to his disability, and a pro
rata portion of the unvested or unexercisable stock options granted to
Executive that otherwise would have become vested or exercisable upon the
conclusion of such vesting period shall become vested and exercisable on the
date of Executive’s termination due to such disability, and (iii) as
applicable, Executive shall be entitled to receive the cash amount described in
the last sentence of Section 3(d) with respect to the restricted shares
referenced in such Section 3(d) (for the avoidance of doubt, the foregoing
clauses (i), (ii) and (iii) shall not refer to grants under the Employer’s
Outperformance Plan, which shall apply in accordance with its terms as in
effect from time to time).  Furthermore,
upon such disability, any vested unexercised stock options granted to Executive
shall remain vested and exercisable until the earlier of (A) the date on which
the term of such stock options otherwise would have expired, or (B) the second
January 1 after the date of Executive’s termination due to his disability.  Other than as expressly provided in this
Section 7(d), the Employer shall have no further obligations hereunder
following such termination.

 

8.     Confidentiality; Prohibited Activities.  Executive and the Employer recognize that
due to the nature of his employment and relationship with the Employer,
Executive has access to and develops confidential business information,
proprietary information, and trade secrets relating to the business and
operations of the Employer.  Executive
acknowledges that (i) such information is valuable to the business of the
Employer, (ii) disclosure to, or use for the benefit of, any person or entity
other than the Employer, would cause irreparable damage to the Employer, (iii)
the principal businesses of the Employer are the acquisition, development,
management, leasing or financing of any office real estate property, including
without limitation the origination of first-mortgage and mezzanine debt or
preferred equity financing for real estate projects throughout the United
States (collectively, the “Business”), (iv) the Employer is one of the limited
number of persons who have developed a business such as the Business, and (v)
the Business is national in scope. 
Executive further acknowledges that his duties for the Employer include
the duty to develop and maintain client, customer, employee, and other business
relationships on behalf of the Employer; and that access to and development of
those close business relationships for the Employer render his services
special, unique and extraordinary.  In
recognition that the good will and business relationships described herein are
valuable to the Employer, and that loss of or damage to those

 

10

 

relationships would
destroy or diminish the value of the Employer, and in consideration of the
compensation (including severance) arrangements hereunder, and other good and
valuable consideration the receipt and sufficiency of which are hereby
acknowledged by Executive, Executive agrees as follows:

 

(a)   Confidentiality.  During the term of this Agreement (including
any renewals), and at all times thereafter, Executive shall maintain the
confidentiality of all confidential or proprietary information of the Employer
(“Confidential Information”), and, except in furtherance of the business of the
Employer or as specifically required by law or by court order, he shall not
directly or indirectly disclose any such information to any person or entity;
nor shall he use Confidential Information for any purpose except for the benefit
of the Employer.  For purposes of this
Agreement, “Confidential Information” includes, without limitation:  client or customer lists, identities,
contacts, business and financial information (excluding those of Executive
prior to employment with Employer); investment strategies; pricing information
or policies, fees or commission arrangements of the Employer; marketing plans,
projections, presentations or strategies of the Employer; financial and budget
information of the Employer; new personnel acquisition plans; and all other
business related information which has not been publicly disclosed by the
Employer.  This restriction shall apply
regardless of whether such Confidential Information is in written, graphic, recorded,
photographic, data or any machine readable form or is orally conveyed to, or
memorized by, Executive.

 

(b)   Prohibited Activities.  Because Executive’s services to the Employer
are essential and because Executive has access to the Employer’s Confidential
Information, Executive covenants and agrees that:

 

(i)            during
the Employment Period, and (x) for the 18-month period following the
termination of Executive by either party for any reason, other than by
Executive without Good Reason under Section 6(b)(iii), or (y) for the
24-month period following termination by Executive without Good Reason,
Executive will not, anywhere in the United States, without the prior written
consent of the Board which shall include the unanimous consent of the Directors
other than any other officer of the Employer, directly or indirectly
(individually, or through or on behalf of another entity as owner, partner,
agent, employee, consultant, or in any other capacity), engage, participate or
assist, as an owner, partner, employee, consultant, director, officer, trustee
or agent, in any element of the Business, subject, however, to
Section 8(c) below; provided, however, that, if the Employment Term
terminates upon or after the scheduled expiration of the term of this Agreement
(including any renewals) without any early termination under Section 6,
the restrictions of this Section 8(b)(i) shall apply for one year (rather
than 18 months) following the termination of Executive; and

 

(ii)           during the Employment Period, and (x) during the two-year period following the
termination of Executive by either party for any reason (including the
expiration of the term of the Agreement), in the case of clause (A) below, or
(y) for the period following such termination during which the restrictions of
Section 8(b)(i) are applicable (but in no event longer than 24 months), in
the case of clause (B) below, Executive will not, without the prior
written consent of the Board which shall include the unanimous consent of the
Directors, who are not officers of the Employer, directly or indirectly
(individually, or through or on behalf of another entity as owner, partner,
agent,

 

11

 

employee, consultant, or
in any other capacity), (A) solicit, encourage, or engage in any activity to
induce any Employee of the Employer to terminate employment with the Employer,
or to become employed by, or to enter into a business relationship with, any
other person or entity, or (B) engage in any activity intentionally to
interfere with, disrupt or damage the Business of the Employer, or its
relationships with any client, supplier or other business relationship of the
Employer.  For purposes of this
subsection (b)(ii), the term “employee” means any individual who is an employee
of or consultant to the Employer (or any affiliate) during the six-month period
prior to Executive’s last day of employment.

 

(c)   Other Investments.  Notwithstanding anything contained herein to
the contrary, Executive is not prohibited by this Section 8 from making
investments (i) expressly disclosed to the Employer in writing before the date
hereof; (ii) solely for investment purposes and without participating in the
business in which the investments are made, in any entity that engages,
directly or indirectly, in the acquisition, development, construction,
operation, management, financing or leasing of office real estate properties,
regardless of where they are located, if (x) Executive’s aggregate investment
in each such entity constitutes less than one percent of the equity ownership
of such entity, (y) the investment in the entity is in securities traded on any
national securities exchange or the National Association of Securities Dealers,
Inc. Automated Quotation System, and (z) Executive is not a controlling person
of, or a member of a group which controls, such entity; or (iii) if (A) he has less than a 25% interest in the
investment in question, (B) he does not have the role of a general partner or
managing member, or any similar role, (C) the investment is not an appropriate
investment opportunity for the Employer, and (D) the investment activity is not
directly competitive with the businesses of the Employer.

 

(d)   Employer Property.  Executive acknowledges that all originals
and copies of materials, records and documents generated by him or coming into
his possession during his employment by the Employer are the sole property of
the Employer (“Employer Property”). 
During his employment, and at all times thereafter, Executive shall not
remove, or cause to be removed, from the premises of the Employer, copies of
any record, file, memorandum, document, computer related information or
equipment, or any other item relating to the business of the Employer, except
in furtherance of his duties under this Agreement.  When Executive terminates his employment with the Employer, or
upon request of the Employer at any time, Executive shall promptly deliver to
the Employer all originals and copies of Employer Property in his possession or
control and shall not retain any originals or copies in any form, except that
Executive may retain a copy of his Rolodex or other similar contact list.

 

(e)   No Disparagement.  For one year following termination of
Executive’s employment for any reason, Executive shall not intentionally
disclose or cause to be disclosed any negative, adverse or derogatory comments
or information about (i) the Employer and its parent, affiliates or
subsidiaries, if any; (ii) any product or service provided by the Employer and
its parent, affiliates or subsidiaries, if any; or (iii) the Employer’s and its
parent’s, affiliates’ or subsidiaries’ prospects for the future.  For one year following termination of
Executive’s employment for any reason, the Employer shall not disclose or cause
to be disclosed any negative, adverse or derogatory comments or information
about Executive.  Nothing in this
Section shall prohibit either the Employer or Executive from testifying
truthfully in any legal or administrative proceeding.

 

12

 

(f)    Remedies.  Executive declares that the foregoing limitations in Sections
8(a) through 8(f) above are reasonable and necessary for the adequate
protection of the business and the goodwill of the Employer.  If any restriction contained in this
Section 8 shall be deemed to be invalid, illegal or unenforceable by
reason of the extent, duration or scope thereof, or otherwise, then the court
making such determination shall have the right to reduce such extent, duration,
scope, or other provisions hereof to make the restriction consistent with
applicable law, and in its reduced form such restriction shall then be
enforceable in the manner contemplated hereby. 
In the event that Executive breaches any of the promises contained in
this Section 8, Executive acknowledges that the Employer’s remedy at law
for damages will be inadequate and that the Employer will be entitled to
specific performance, a temporary restraining order or preliminary injunction
to prevent Executive’s prospective or continuing breach and to maintain the
status quo.  The existence of this right
to injunctive relief, or other equitable relief, or the Employer’s exercise of
any of these rights, shall not limit any other rights or remedies the Employer
may have in law or in equity, including, without limitation, the right to
arbitration contained in Section 9 hereof and the right to compensatory
and monetary damages.  Executive hereby
agrees to waive his right to a jury trial with respect to any action commenced
to enforce the terms of this Agreement. 
Executive shall have remedies
comparable to those of the Employer as set forth above in this
Section 8(f) if the Employer breaches Section 8(e).

 

(g)   Transition.  Regardless of the reason for his departure from the Employer,
Executive agrees that at the Employer’s sole costs and expense, for a period of
not more than 30 days after termination of Executive, he shall take all steps
reasonably requested by the Employer to effect a successful transition of
client and customer relationships to the person or persons designated by the
Employer, subject to Executive’s obligations to his new employer.

 

(h)   Cooperation with Respect to Litigation.  During the Employment period and at all
times thereafter, Executive agrees to give prompt written notice to the
Employer of any claim relating to the Employer and to cooperate fully, in good
faith and to the best of his ability with the Employer in connection with any
and all pending, potential or future claims, investigations or actions which
directly or indirectly relate to any action, event or activity about which
Executive may have knowledge in connection with or as a result of his
employment by the Employer hereunder. 
Such cooperation will include all assistance that the Employer, its
counsel or its representatives may reasonably request, including reviewing
documents, meeting with counsel, providing factual information and material,
and appearing or testifying as a witness; provided, however, that the Employer
will reimburse Executive for all reasonable expenses, including travel, lodging
and meals, incurred by him in fulfilling his obligations under this
Section 8(h) and, except as may be required by law or by court order,
should Executive then be employed by an entity other than the Employer, such
cooperation will not materially interfere with Executive’s then current
employment.

 

(i)    Survival.  The provisions of this Section 8 shall survive termination
of Executive’s employment any other provisions relating to the enforcement
thereof.

 

9.     Arbitration.  Any
controversy or claim arising out of or relating to this Agreement or the breach
of this Agreement (other than a controversy or claim arising under
Section 8, to the extent necessary for the Employer (or its affiliates,
where applicable) to avail itself of the rights and remedies referred to in
Section 8(f)) that is not resolved by Executive and the Employer (or its
affiliates, where

 

13

 

applicable) shall be
submitted to arbitration in New York, New York in accordance with New York law
and the procedures of the American Arbitration Association.  The determination of the arbitrator(s) shall
be conclusive and binding on the Employer (or its affiliates, where applicable)
and Executive and judgment may be entered on the arbitrator(s)’ award in any
court having jurisdiction.

 

10.   Conflicting Agreements.  Executive hereby represents and warrants
that the execution of this Agreement and the performance of his obligations
hereunder will not breach or be in conflict with any other agreement to which he
is a party or is bound, and that he is not now subject to any covenants against
competition or similar covenants which would affect the performance of his
obligations hereunder.

 

11.   No Duplication of Payments.  Executive shall not be entitled to receive
duplicate payments under any of the provisions of this Agreement.

 

12.   Notices.  All notices or other communications required or permitted to be
given hereunder shall be in writing and shall be delivered by hand and or sent
by prepaid telex, cable or other electronic devices or sent, postage prepaid,
by registered or certified mail or telecopy or overnight courier service and
shall be deemed given when so delivered by hand, telexed, cabled or telecopied,
or if mailed, three days after mailing (one business day in the case of express
mail or overnight courier service), as follows:

 

(a)   if to Executive:

 

Marc Holliday, at
the address shown on the execution page hereof.

 

(b)   if to the Employer:

 

SL Green Realty
Corp.

420 Lexington Avenue

New York, New York 10170

Attn:  General Counsel

 

With a copy to:

 

Clifford
Chance US LLP

200
Park Avenue

New
York, New York  10166

Attention:  Robert E. King, Jr.

 

or such other address as
either party may from time to time specify by written notice to the other party
hereto.

 

13.   Amendments.  No amendment, modification or waiver in respect of this Agreement
shall be effective unless it shall be in writing and signed by the party
against whom such amendment, modification or waiver is sought.

 

14.   Severability.  If any provision of this Agreement (or any
portion thereof) or the application of any such provision (or any portion
thereof) to any person or circumstances shall be held invalid, illegal or
unenforceable in any respect by a court of competent jurisdiction, such invalidity,
illegality or

 

14

 

unenforceability shall
not affect any other provision hereof (or the remaining portion hereof) or the
application of such provision to any other persons or circumstances.

 

15.   Withholding.  The Employer shall be entitled to withhold from any payments or
deemed payments any amount of tax withholding it determines to be required by
law.

 

16.   Successors and Assigns.  This Agreement shall be binding upon and
inure to the benefit of both parties and their respective successors and
assigns, including any corporation with which or into which the Employer may be
merged or which may succeed to its assets or business, provided, however, that
the obligations of Executive are personal and shall not be assigned by
him.  This Agreement shall inure to the
benefit of and be enforceable by Executive’s personal and legal
representatives, executors, administrators, assigns, heirs, distributees,
devisees and legatees.

 

17.   Counterparts.  This Agreement may be executed in one or
more  counterparts, all of which shall
be considered one and the same 
agreement, and shall become effective when one or more such  counterparts have been signed by each of the
parties and  delivered to the other
party.

 

18.   Governing Law.  This Agreement shall be governed by and  construed in accordance with the laws of the
State of New York  applicable to
agreements made and to be performed entirely within  such State, without regard to the conflicts of law principles
of  such State.

 

19.   Choice of Venue.  Executive agrees to submit to the  jurisdiction of the United States District
Court for the Southern  District of New
York or the Supreme Court of the State of New 
York, New York County, for the purpose of any action to enforce  any of the terms of this Agreement.

 

20.   Parachutes.  Notwithstanding any other provision of this Agreement, if all or
any portion of the payments and benefits provided under this Agreement
(including without limitation any accelerated vesting), or any other payments
and benefits which Executive receives or is entitled to receive from the
Employer or an affiliate, or any combination of the foregoing, would constitute
an excess “parachute payment” within the meaning of Section 280G of the
Internal Revenue Code of 1986, as amended (the “Code”) (whether or not under an
existing plan, arrangement or other agreement) (each such parachute payment, a
“Parachute Payment”), and would result in the imposition on Executive of an
excise tax under Section 4999 of the Code or any successor thereto, then,
in addition to any other benefits to which Executive is entitled under this
Agreement, Executive shall be paid by the Employer an amount in cash equal to
the sum of the excise taxes payable by Executive by reason of receiving Parachute
Payments plus the amount necessary to put Executive in the same after-tax
position (taking into account any and all applicable federal, state and local
excise, income or other taxes at the highest possible applicable rates on such
Parachute Payments (including without limitation any payments under this
Section 20)) as if no excise taxes had been imposed with respect to
Parachute Payments (the “Parachute Gross-up”). 
The amount of any payment under this Section 20 shall be computed
by a certified public accounting firm of national reputation reasonably
selected by the Employer.  Executive and
the Employer will provide the accounting firms with all information which any
accounting firm reasonably deems necessary in computing the Parachute Gross-up
to be made available to Executive.  In
the event that the Internal Revenue Service or a court, as applicable, finally
and in a decision that has become unappealable, determines that a greater or
lesser amount of tax is due, then the Employer shall within five business days
thereafter shall pay the additional amounts, or Executive within five business
days after receiving a refund shall pay over the amount refunded to the
Employer, respectively; provided that (i) Executive shall not initiate any
proceeding or other contests regarding these matters, other than at the
direction of the

 

15

 

Employer, and shall
provide notice to the Employer of any proceeding or other contest regarding
these matters initiated by the Internal Revenue Service, and (ii) the Employer
shall be entitled to direct and control all such proceeding and other contests,
if it commits to and does pay all costs (including without limitation legal and
other professional fees) associated therewith.

 

21.   Entire Agreement.  This Agreement contains the entire agreement
and understanding between the parties hereto with  respect to the subject matter hereof and supersedes all prior  agreements and understandings relating to
such subject matter.  The parties hereto
shall not be liable or bound to any other 
party in any manner by any representations, warranties or covenants
relating to such subject matter except as specifically set forth herein.

 

22.   Paragraph Headings.  Section headings used in this  Agreement are included for convenience of
reference only and will  not affect the
meaning of any provision of this agreement.

 

23.   Board Approval.  Employer represents that the Board has
approved the economic terms of this Agreement.

 

IN WITNESS WHEREOF, this
Agreement is entered into as of the date and year first written above, and is
being executed on March 10, 2004.

 

 

	
   

  	
  SL GREEN REALTY CORP.

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
  Title:

  
	
   

  
	
   

  
	
   

  	
   

  
	
  Marc Holliday

  
	
   

  
	
  [to be deleted from all
  public filings:]

  
	
   

  
	
   

  
	
   

  
					

 

16

 

EXHIBIT A

 

RESTRICTED STOCK AWARD 

 

Plan:  SL Green Realty Corp. Amended 1997 Stock
Option and Incentive Plan (the “Plan”)

 

Grant Date:  January 1, 2004

 

Total Number of
Shares:  302,500 – 175,000 shares issued
as of January 1, 2004 (the “New Shares”), in addition to 127,500 shares
already outstanding (the “Old Shares”).

 

Time-Based Vesting:  The shares shall vest if and as employment
continues, at the times and in the amounts as set forth below:  

 

	
  July 17, 2004

  	
   

  	
  14,583 shares

  
	
  July 17, 2005

  	
   

  	
  14,583 shares

  
	
  July 17, 2006

  	
   

  	
  14,583 shares

  
	
  July 17, 2007

  	
   

  	
  14,583 shares

  
	
  July 17, 2008

  	
   

  	
  14,583 shares

  
	
  July 17, 2009

  	
   

  	
  14,585 shares

  

 

Performance Vesting:  In addition, 215,000 shares shall vest
(subject to clauses (i) and (ii) below) if and as employment continues, at the
times and in the amounts as set forth below:

 

	
  July 17, 2004

  	
   

  	
  25,417 shares

  
	
  July 17, 2005

  	
   

  	
  25,417 shares

  
	
  July 17, 2006

  	
   

  	
  25,417 shares

  
	
  July 17, 2007

  	
   

  	
  35,417 shares

  
	
  July 17, 2008

  	
   

  	
  45,417 shares

  
	
  July 17, 2009

  	
   

  	
  45,417 shares

  
	
  January 1, 2010

  	
   

  	
  12,498 shares

  

 

With respect to such
215,000 shares, such amounts are subject to the achievement of certain annual
criteria set forth below:

 

(i)                                     Such
shares shall vest in an applicable year if the Company achieves either (A) a 7%
increase in funds from operations on a per-share basis or (B) a 10% total
return to shareholders (including all dividends and stock appreciation) on each
share of the Company’s Common Stock, during the last fiscal year completed
before the applicable Vesting Date.

 

(ii)                                  If
the performance criteria set forth in paragraph (i) above are not achieved in
the fiscal year immediately preceding the applicable Vesting Date, the shares
that did not vest in such year may still vest upon the satisfaction of the performance
criteria on a cumulative basis beginning with the “Applicable Period” (as
defined

 

17

 

below).  If the cumulative performance measures are
satisfied, then any shares that failed to vest during such prior year shall
vest as of the applicable Vesting Date.

 

Notwithstanding the foregoing, if the performance
criteria set forth in paragraph (i) above for a particular year are not met,
but the Company’s total return to shareholders is in the top one-third of its
peer group companies (as to be determined for such year by the committee
administering the Plan in its sole discretion) during the last fiscal year
completed immediately prior to the applicable Vesting Date, then the shares
that otherwise would have vested on such Vesting Date shall vest.  For these purposes, (x) with respect to the
87,500 New Shares, the “Applicable Period” is the period commencing on the
first day of the fiscal year commencing in 2003 and ending with the
then-current fiscal year, (y) with respect to the 127,500 Old Shares, the
“Applicable Period” is the period commencing on the first day of the fiscal
year commencing in 2001 and ending with the then-current fiscal year, and (z)
the shares potentially vesting on each vesting date covering the shares subject
to performance vesting shall be considered to be a pro rata amount of each of
the shares subject to clause (x) and the shares subject to clause (y).

 

18

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