Exhibit 10.1
EMPLOYMENT AGREEMENT
This Employment Agreement (this “Agreement”), is dated as of January 28, 2011
(the “Execution Date”) and effective as of February 1, 2011 (the “Effective
Date”), by and between Equity One, Inc. (the “Company”), a Maryland corporation,
and Thomas A. Caputo (“Executive”).
RECITALS
The Company believes that Executive’s services will continue to be integral to
the success of the Company. The Company wishes to retain the services of
Executive and expects that Executive’s contribution to the growth of the Company
will be substantial. The Company desires to provide for the employment of
Executive on terms that will reinforce and encourage Executive’s attention and
dedication to the Company. Executive is willing to commit himself to serve the
Company, on the terms and conditions provided below.
Executive is currently employed by the Company pursuant to a certain Employment
Agreement (as heretofore amended, supplemented or otherwise modified, the
“Current Employment Agreement”), effective as of March 14, 2008, which
agreement, by its terms will, unless extended or renewed, expire on January 31,
2011 unless earlier terminated. Subject to the earlier termination of the
Current Employment Agreement pursuant to the terms thereof, the Company desires
to continue to employ Executive from and after the Effective Date on the terms
and conditions set forth in this Agreement, and subject to the earlier
termination of the Current Employment Agreement pursuant to the terms thereof,
Executive desires to be so employed.
IN CONSIDERATION of the premises and the mutual covenants set forth below, the
parties hereby agree as follows:
AGREEMENT
     1. Employment. Subject to the earlier termination of the Current Employment
Agreement pursuant to the terms thereof, the Company hereby agrees to employ
Executive from and after the Effective Date, and subject to the earlier
termination of the Current Employment Agreement pursuant to the terms thereof,
Executive hereby agrees to such employment, on the terms and conditions
hereinafter set forth.
     2. Term. The period of employment of Executive by the Company hereunder
(the “Employment Period”) shall commence on the Effective Date and shall
continue through December 31, 2014 (or, in the event of any renewal and
extension as contemplated hereby, the last day of the relevant successive
one-year renewal and extension period) or such earlier date on or as of which
this Agreement or Executive’s employment hereunder is terminated in accordance
with the terms hereof. Subject to this Agreement or Executive’s employment
hereunder being terminated in accordance with the terms hereof on or prior to
December 31, 2014 (or, in the event of any renewal and extension as contemplated
hereby, the last day of the current successive one-year renewal and extension
period), this Agreement and the Employment Period automatically shall be renewed
and extended for successive one-year periods thereafter unless either party
gives the other party prior written notice at least six months before the
expiration of

 

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the Employment Period of that party’s intent to allow the Employment Period and
this Agreement to expire. As used herein, “End of Term Date” means December 31,
2014; provided, however, that, if this Agreement and the Employment Period shall
(as provided above) have been automatically renewed and extended for any
successive one-year period, “End of Term Date” means the last day of such
one-year period.
     3. Position and Duties. From the Effective Date and thereafter during the
Employment Period, Executive shall serve as the President of the Company and
shall report s to the Chief Executive Officer of the Company and, as
appropriate, to the Board of Directors of the Company (the "Board”) or any
committee thereof. Executive shall have those powers and duties normally
associated with such position and such other powers and duties as the Chief
Executive Officer or the Board properly may prescribe, provided that such other
powers and duties are not inconsistent with Executive’s position as President of
the Company. Executive shall devote his full business time, attention and
energies to the Company’s affairs as are necessary to fully perform his duties
for the Company (other than absences due to illness or vacation).
Notwithstanding the foregoing, the Company acknowledges that Executive has an
interest in a real estate project in Bailey’s Crossroads, Virginia and also
serves as a trustee of The Hackley School located in Tarrytown, New York and may
devote time to these endeavors during the Employment Period; provided, however,
that such devotion of time shall not detrimentally interfere with the
performance of his duties under this Agreement.
     4. Place of Performance. The principal place of employment of Executive
shall be at the Company’s corporate offices in the New York City metropolitan
area, subject to reasonable travel as required in the performance of his duties
outlined above.
     5. Compensation and Related Matters.
          (a) Salary. During the Employment Period, the Company shall pay
Executive an annual base salary of not less than $650,000 (“Base Salary”),
which, for the purposes of this Section 5(a), shall be retroactively adjusted to
January 1, 2011. Executive’s Base Salary shall be paid in approximately equal
installments in accordance with the Company’s customary payroll practices. If
the Company increases Executive’s Base Salary, such increased Base Salary shall
then constitute the Base Salary for all purposes of this Agreement.
          (b) Annual Cash Bonus.
          (i) The Compensation Committee of the Board (the “Compensation
Committee”) shall review Executive’s performance with the Chief Executive
Officer at least annually following each calendar year of the Employment Period
and cause the Company to award Executive an annual cash bonus (“Bonus”) in such
amount as the Compensation Committee shall reasonably determine as fairly
compensating and rewarding Executive for services rendered to the Company and/or
as an incentive for continued service to the Company. Subject to the immediately
following sentence of this Section 5(b)(i), the amount of Executive’s Bonus
shall be determined in the sole and absolute discretion of the Compensation
Committee and shall depend on, among other things, the Company’s achievement of
certain performance levels established from time to time by the Compensation
Committee (such performance levels, as from time to time established by the

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Compensation Committee, the “Performance Levels”), which may (in the sole and
absolute discretion of the Compensation Committee) include, without limitation,
growth of earnings, funds from operations per share of Company stock, earnings
per share of Company stock and Executive’s performance and contribution to
increasing the funds from operations, as well as such individual goals for
Executive as the Compensation Committee may deem appropriate. It is anticipated
that the Performance Levels will be set for each calendar year of the Employment
Period so that Executive can reasonably be expected to earn a Bonus for such
calendar year in an amount equal to fifty percent (50%) of the Base Salary of
Executive for such calendar year. The Company shall pay any Bonus to Executive
on or before March 15th of the calendar year following the calendar year to
which such Bonus relates.
     (ii) Notwithstanding anything contained herein to the contrary, no Bonus
shall be payable hereunder to Executive with respect to any calendar year unless
Executive is employed hereunder by the Company as of the last day of such
calendar year.
     (c) Restricted Stock.
               (i) Effective on the Execution Date, the Company shall grant to
Executive, under an equity compensation plan of the Company, sixty-nine thousand
three hundred and three (69,333) shares of the Company’s restricted stock. Half
of the shares of the Company’s restricted stock so granted to Executive shall
vest on December 31, 2012 if either Executive is then employed hereunder by the
Company (the shares of the Company’s restricted stock that would so vest if
Executive is employed hereunder by the Company on December 31, 2012 are
hereinafter referred to as the “First Tranche Shares”) or such shares otherwise
vest pursuant to the terms of this Agreement, and the remaining half of those
shares of the Company’s restricted stock so granted to Executive shall vest on
December 31, 2014 if either Executive is then employed hereunder by the Company
(the shares of the Company’s restricted stock that would so vest if Executive is
employed hereunder by the Company on December 31, 2014 are hereinafter referred
to as the “Second Tranche Shares” and the First Tranche Shares and Second
Tranche Shares are hereinafter referred to collectively as the “Non-Contingent
Shares”) or such shares otherwise vest pursuant to the terms of this Agreement.
Executive shall not be entitled to receive on or with respect to any shares of
the Company’s restricted stock granted and issued pursuant to this
Section 5(c)(i) any regular quarterly cash dividends that are declared by the
Board and payable or distributable to the Company’s stockholders of record prior
to the Effective Date or to vote any of such shares prior to the Effective Date,
but (notwithstanding that such shares of the Company’s restricted stock have not
vested) Executive shall be entitled to receive with respect to such shares
(a) any special or extraordinary dividend or distribution (including, without
limitation, any securities issued or distributed to the Company’s stockholders
of record on or after the Execution Date in connection with any stock split,
recapitalization, stock exchange, merger, combination or other reorganization or
similar transaction) to the Company’s stockholders of record on or after the
Execution Date and through the last day of the Employment Period and, if such
shares of the Company’s restricted stock have become vested, thereafter and
(b) any regular quarterly cash dividends to the Company’s stockholders of record
on or after the Effective Date and through the last day of the Employment Period
and, if such shares of the Company’s restricted stock have become vested,
thereafter. The grant of shares of the Company’s restricted stock made by the
Company pursuant to this Section 5(c)(i) is hereinafter referred to as the
“Non-Contingent Grant.”

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               (ii) Effective on the Execution Date, the Company shall grant to
Executive, under an equity compensation plan of the Company, three hundred
seventy-three thousand three hundred and three (373,333) shares of the Company’s
restricted stock. All of such shares of the Company’s restricted stock shall
vest on December 31, 2014 if both (A) Executive is then employed hereunder by
the Company and (B) the Primary Benchmark (as hereinafter determined) has been
achieved for the period from the Effective Date through December 31, 2014; and
one-half (1/2) of such shares of the Company’s restricted stock shall vest on
December 31, 2014 if both (Y) Executive is then employed hereunder and (Z) the
Secondary Benchmark (as hereinafter determined) has been achieved for the period
from the Effective Date through December 31, 2014. Alternatively, some or all of
such shares of the Company’s restricted stock may vest as otherwise provided in
this Agreement. Executive shall not be entitled to exercise any vote or right of
consent associated with or attendant to any shares of the Company’s restricted
stock granted and issued pursuant to this Section 5(c)(ii) unless and until such
shares of the Company’s restricted stock have become vested, and except as and
to the extent provided in Section 5(c)(iii) below, Executive shall not be
entitled to receive on or with respect to any shares of the Company’s restricted
stock granted and issued pursuant to this Section 5(c)(ii) any regular quarterly
cash dividends or any other dividend or distribution (whether or not special or
extraordinary and whether or not consisting of any securities issued or
distributed to the Company’s stockholders of record in connection with any stock
split, recapitalization, stock exchange, merger, combination or other
reorganization or similar transaction) unless and until such shares of the
Company’s restricted stock have become vested. The grant of shares of the
Company’s restricted stock made by the Company pursuant to this Section 5(c)(ii)
is hereinafter referred to as the “Contingent Grant,” and the shares of the
Company’s restricted stock granted to Executive pursuant to this
Section 5(c)(ii) are hereinafter referred to collectively as the “Contingent
Grant Shares.”
               (iii) Notwithstanding anything to the contrary contained herein,
(A) if, as the consequence of any stock split, stock dividend, reverse stock
split, combination or similar event occurring after the Execution Date and prior
to the date any Contingent Grant Shares vest as provided above (such date, the
“Vesting Date”), the number of outstanding shares of the Company’s common stock
has been increased or decreased, then the shares of the Company’s common stock
that shall then vest shall be appropriately increased or decreased,
respectively, and (B) upon the vesting of any Contingent Grant Shares, Executive
shall also be entitled to receive with respect to such Contingent Grant Shares
all such dividends and distributions (whether or not consisting of any
securities issued or distributed to the Company’s stockholders of record in
connection with any stock split, recapitalization, stock exchange, merger,
combination or other reorganization or similar transaction, exclusive, however,
of any stock split or other issuance that has been taken into account pursuant
to the foregoing clause (A)), exclusive, however, of any regular quarterly cash
dividends, that would have been payable on and with respect to such Contingent
Grant Shares if Executive had been the holder of record of such Contingent Grant
Shares on or after the Effective Date and prior to the Vesting Date.
               (iv) For purposes of the foregoing and the other provisions of
this Agreement, the following terms shall have the following respective
meanings:

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          “Basket of Comparables” means an investment that is comprised of
$10,000 invested in the shares of common stock or other equity interests of each
of the Peer Companies (as hereinafter defined) (assuming such investment were
made on the Effective Date based upon the Market Value of such shares of common
stock or other equity interests as of the Effective Date).
          “Company Investment” means an investment that is comprised of $10,000
invested in shares of the Company’s common stock (assuming such investment were
made on the Effective Date based upon the Market Value of such shares of common
stock as of the Effective Date).
          “Peer Companies” means Federal Realty Investment Trust, Developers
Diversified Realty Corp., Kimco Realty Corporation, Weingarten Realty Investors
and Regency Centers Corporation (provided, however, that, if, prior to the end
of any period for which the IRR of a Peer Investment is to be determined, any
such entity (or any other entity directly or indirectly substituted therefor as
contemplated hereby) should merge, cease doing business or otherwise, in the
reasonable discretion of the Compensation Committee, no longer represent a peer
or comparable company to the Company, the Compensation Committee may remove such
entity from the Peer Companies and may (in the reasonable discretion of the
Compensation Committee), but shall not be obligated to, substitute for such
entity a company that in its reasonable discretion is a peer or comparable
company to the Company or to such removed entity).
          “IRR of a Company Investment” means, for any specified period, the
annual internal rate of return, on a compounded basis, of an investment in a
Company Investment during such specified period, inclusive of any dividends (if
any) declared and paid during such specified period on shares of the Company’s
common stock comprising such Company Investment and with the value of the shares
of common stock comprising such Company Investment as of the end of such
specified period being determined on the basis of the Market Value thereof as of
the last day of such specified period.
          “IRR of a Peer Investment” means, for any specified period, the annual
internal rate of return, on a compounded basis, of an investment in the Basket
of Comparables during such specified period, inclusive of any dividends (if any)
declared and paid during such specified period on shares of common stock or
other equity interests comprising the Basket of Comparables and with the value
of the shares of common stock or other equity interests comprising the Basket of
Comparables as of the end of such specified period being determined on the basis
of the Market Value thereof as of the last day of such specified period.
          “Market Value” of a share of common stock or any other equity interest
as of any date means the average closing price of such share of common stock or
other equity interest on the principal stock exchange on which such share of
common stock or other equity interest is listed and traded during the ten
(10) trading days immediately preceding such date.

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          “Primary Benchmark” shall be deemed to have been achieved for any
specified period if both (I) the IRR of a Company Investment for such specified
period equals or exceeds nine percent (9%) and (II) the IRR of a Company
Investment for such specified period is at least 300 basis points in excess of
the IRR of a Peer Investment for such specified period.
          “Secondary Benchmark” shall be deemed to have been achieved for any
specified period if both (I) the IRR of a Company Investment for such specified
period equals or exceeds six percent (6%) and (II) the IRR of a Company
Investment for such specified period is at least 150 basis points in excess of
the IRR of a Peer Investment for such specified period; provided, however, that,
if both the Primary Benchmark and the Secondary Benchmark have been achieved for
any specified period, the Secondary Benchmark shall be deemed not to have been
achieved for such specified period.
          (d) Expenses. The Company shall reimburse Executive for all reasonable
expenses incurred by him in the discharge of his duties hereunder, including
travel expenses, upon the presentation of reasonably itemized statements of such
expenses in accordance with the Company’s policies and procedures now in force
or as such policies and procedures may be modified with respect to all senior
executive officers of the Company. Any frequent flyer miles or points and
similar benefits provided by hotels, credit card companies and others received
by Executive in connection with his business travel shall be retained by
Executive for his personal use. The Company shall provide Executive with credit
cards for the payment of business expenses issued either in the name of the
Company with Executive as authorized user or in the name of Executive for the
account of the Company, and balances thereon (to the extent they include charges
for business expenses for which Executive is entitled to reimbursement under the
first sentence of this Section 5(d)) shall be payable by the Company. Executive
shall maintain detailed records of such expenses in such form as the Company may
reasonably request and shall provide such records to the Company no less
frequently than monthly.
          (e) Vacation; Illness. Executive shall be entitled to the number of
weeks of vacation per year provided to the Company’s other senior executive
officers (exclusive of its Chief Executive Officer and its Chairman), but in no
event less than three (3) weeks annually. Executive shall be entitled to take up
to 30 days of sick leave per year; provided, however, that any prolonged illness
resulting in absenteeism greater than the sick leave permitted herein or
disability shall not constitute “Cause” for termination under the terms of this
Agreement.
          (f) Welfare, Pension and Incentive Benefit Plans. During the
Employment Period, Executive (and his wife and dependents to the extent provided
therein and subject to their qualifying therefor) shall be entitled to
participate in and be covered under all the welfare benefit plans or programs
maintained by the Company from time to time on terms no less favorable than
generally provided for its other senior executive officers (exclusive of its
Chief Executive Officer and its Chairman), including, without limitation, all
medical, hospitalization, dental, disability, accidental death and dismemberment
and travel accident insurance plans and programs. In addition, during the
Employment Period, Executive shall be eligible to participate in and be covered
under all pension, retirement, savings and other employee benefit, perquisite,
change in control and executive compensation plans and any annual incentive or
long-term performance plans and programs generally maintained from time to time
by the Company on

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terms no less favorable than generally provided for its other senior executive
officers (exclusive of its Chief Executive Officer and its Chairman). For
purposes of clarification, plans or programs or other benefits that are provided
to any senior executive officer pursuant to the provisions of any negotiated
contract (including, without limitation, any provision similar to Section 5(g)
or (h) or Section 13(b) of this Agreement) shall not be deemed to be generally
provided for its other senior executive officers.
          (g) Automobile. During the Employment Period, the Company shall
provide Executive with daily transportation by car service, which service shall
be acceptable to the Company, from his residence to Place of Performance
designated in Section 4 above.
          (h) Home Office. The parties understand that Executive may from time
to time be called upon to provide services to the Company from his home or while
on the road. In order to enable Executive to so perform such services, the
Company shall, at its cost, provide Executive with such equipment and services
at his home, and such cellular telephone services and equipment, as may be
necessary and appropriate to enable him to so perform such services.
          (i) No Hedging. Without the prior written consent of the Chief
Executive Officer and the approval of the Board, Executive agrees that neither
he nor any of his designees shall be permitted to (I) purchase financial
instruments (including prepaid variable forward contracts, equity swaps, collars
and exchange funds) that are designed to hedge or offset any decrease in the
market value of equity securities that (a) have been granted to Executive by the
Company as part of the compensation of Executive or (b) are held, directly or
indirectly, by Executive or (II) engage in any Disclosable Activity. As used
herein, “Disclosable Activity” means, as of any time, any conduct or activity
(exclusive, however, of (a) the purchase or other acquisition of any of the
Company’s securities or the sale or other disposition of any of the Company’s
securities and (b) any bone fide pledge of any of the Company’s securities to
secure any loan made by an independent third party to Executive) with respect to
which the Company at or as of such time would be required, pursuant to the
Securities Exchange Act of 1933, as amended, the Securities and Exchange Act of
1934, as amended, or any rule or regulation adopted or promulgated under either
such Act, to make disclosure if Executive (or any designee of Executive) were to
engage in such conduct or activity or if Executive (or any designee of
Executive) were permitted to engage in such conduct or activity.
          (j) Continuation of Entitlement to certain Benefits under Current
Employment Agreement. As long as the Current Employment Agreement is not,
pursuant to the terms thereof, terminated prior to the expiration of the term
thereof, then, notwithstanding its expiration, Executive shall be entitled to
receive, for and with respect to the 2010 calendar year, (i) such bonus as
Executive would have been entitled to receive under Section 5(b) of the Current
Employment Agreement if the Current Employment Agreement had been renewed and
extended for the entire 2011 calendar year and Executive had continued to be
employed thereunder and (ii) such grant of stock options and/or shares of
restricted stock as Executive would have been entitled to receive under
Section 5(c)(iii) of the Current Employment Agreement if the Current Employment
Agreement had been renewed and extended for the entire 2011 calendar year and
Executive had continued to be employed thereunder. Any stock options that are
granted to Executive by the Company as contemplated by this Section 5(j) are,
together with all stock options granted to Executive by the Company prior to the
Effective Date, sometimes referred to

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herein collectively as the “Pre-Effective Stock Options,” and any shares of the
Company’s restricted stock that are granted to Executive by the Company as
contemplated by this Section 5(j) are, together with all shares of the Company’s
restricted stock granted to Executive by the Company prior to the Effective Date
(exclusive, however, of any Non-Contingent Shares and any Contingent Grant
Shares), sometimes referred to herein collectively as the “Pre-Effective Grant
Shares.”
     6. Termination. Executive’s employment hereunder may be terminated during
the Employment Period under the following circumstances:
          (a) Death. Executive’s employment hereunder shall terminate upon his
death.
          (b) Disability. If, as a result of Executive’s incapacity due to
physical or mental illness, Executive shall have been substantially unable to
perform his duties hereunder for an entire period in excess of one hundred
twenty (120) days in any 12-month period despite any reasonable accommodation
available from the Company, the Company shall have the right to terminate
Executive’s employment hereunder for “Disability”, and such termination in and
of itself shall not be, nor shall it be deemed to be, a breach of this
Agreement.
          (c) Without Cause. The Company shall have the right to terminate
Executive’s employment for any reason or for no reason, which termination shall
be deemed to be without Cause unless made for any of the reasons specified in
Section 6(d) below, and such termination in and of itself shall not be, nor
shall it be deemed to be, a breach of this Agreement.
          (d) Cause. The Company shall have the right to terminate Executive’s
employment for Cause, and such termination in and of itself shall not be, nor
shall it be deemed to be, a breach of this Agreement. For purposes of this
Agreement, the Company shall have “Cause” to terminate Executive’s employment
upon Executive’s:
               (i) Breach of any material provisions of this Agreement;
               (ii) Conviction of a felony, capital crime or any crime involving
moral turpitude, including, but not limited to, crimes involving illegal drugs;
or
               (iii) Willful misconduct that is materially economically
injurious to the Company or to any Company Affiliate (as defined below).
For purposes of this Section 6(d), no act, or failure to act, by Executive shall
be considered “willful” unless committed in bad faith or without a reasonable
belief that the act or omission was in the best interests of the Company or any
Company Affiliate; provided, however, that the willful requirement outlined in
clause (iii) above shall be deemed to have occurred if Executive’s action or
non-action continues for more than ten (10) days after Executive has received
written notice of the inappropriate action or non-action. Failure to achieve
performance goals, in and of itself, shall not be grounds for a termination for
Cause. For purposes of this Agreement, “Company Affiliate” means as any entity
in control of, controlled by or under common control with the Company or in
which the Company owns a material amount of common or preferred

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stock or interest or any entity in control of, controlled by or under common
control with such entity in which the Company owns any common or preferred stock
or interest.
Cause shall not exist under clause (i) or (iii) above unless and until the
Company has delivered to Executive a copy of a resolution duly adopted by a
majority of the Board (excluding Executive and any other officer or employee of
the Company for purposes of determining such majority) at a meeting of the Board
called and held for such purpose, finding that, in the good faith opinion of the
Board, Executive was guilty of the conduct set forth in clause (i) or
(iii) above and specifying the particulars thereof in reasonable detail.
However, in the case of conduct described in clause (i) above, Cause will not be
considered to exist unless (a) Executive is given notice of such breach and
(b) if such breach can reasonably be cured within thirty (30) days, such breach
has, within thirty (30) days after the date of such notice, been cured to the
satisfaction of the Board or, if such breach cannot reasonably be cured within
such 30-day period, Executive has promptly commenced to cure such breach, has
thereafter diligently taken all appropriate steps to cure such breach as quickly
as reasonably practical and has cured such breach within sixty (60) days after
the date of such notice, all to the satisfaction of the Board. In the event a
final determination is made by a court of competent jurisdiction that the
Company’s termination of Executive under this Section 6(d) does not meet the
definition of Cause, Executive will be deemed to have been terminated by the
Company without Cause.
          (e) Change in Control. For purposes of this Agreement, a “Change in
Control” means:
               (i) Consummation by the Company of (A) a reorganization, merger,
consolidation or other form of corporate transaction or series of transactions,
in each case, other than a reorganization, merger or consolidation or other
transaction that would result in the holders of the voting securities of the
Company outstanding immediately prior thereto holding securities that represent
immediately after such transaction more than 50% of the combined voting power of
the voting securities of the Company or the surviving company or the parent of
the surviving company, (B) a liquidation or dissolution of the Company or
(C) the sale of all or substantially all of the assets of the Company;
               (ii) Individuals who, as of the Effective Date, constitute the
Board (the “Incumbent Board”) cease for any reason to constitute at least a
majority of the Board, provided (A) that any person becoming a director
subsequent to the Effective Date whose election, or nomination for election by
the Company’s stockholders, was approved by a vote of at least a majority of the
directors then comprising the Incumbent Board (other than an election or
nomination of an individual whose initial assumption of office is in connection
with an actual or threatened election contest relating to the election of the
Directors of the Company, as such terms are used in Rule 14a-11 of
Regulation 14A promulgated under the Securities Exchange Act of 1934, as
amended) or (B) any individual appointed to the Board by the Incumbent Board
shall be, for purposes of this Agreement, considered as though such person were
a member of the Incumbent Board; or
               (iii) The acquisition (other than from the Company) by any
person, entity or “group,” within the meaning of Section 13(d)(3) or 14(d)(2) of
the Securities Exchange Act of 1934, as amended, of more than 26% of either the
then outstanding shares of the

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Company’s common stock or the combined voting power of the Company’s then
outstanding voting securities entitled to vote generally in the election of
directors (hereinafter referred to as the ownership of a “Controlling Interest”)
excluding, for this purpose, any acquisitions by (A) the Company or its
subsidiaries, or (B) any person, entity or “group” that as of the Effective Date
beneficially owns (within the meaning of Rule 13d-3 promulgated under the
Securities Exchange Act of 1934, as amended) a Controlling Interest of the
Company or any affiliate of such person, entity or “group.”
Executive acknowledges and agrees that, notwithstanding anything in this
Agreement to the contrary, a Change in Control shall not be deemed to have
occurred for purposes of this Agreement if, after the consummation of any of the
events described in the definition of a Change in Control, Chaim Katzman remains
Chairman of the Board of the Successor Employer (as hereinafter defined) and if
Gazit, Inc. and its affiliates own in the aggregate 33% or more of the
outstanding voting securities of the Successor Employer. For purposes of this
Agreement, the term “Successor Employer” shall mean the Company, the
reorganized, merged or consolidated Company (or the successor thereto), or the
acquiror (through merger or otherwise) of all or substantially all of the assets
of the Company, as the case may be.
          (f) Resignation Other Than For Good Reason. Executive shall have the
right to resign his employment hereunder by providing the Company with a Notice
of Termination, as provided in Section 7 below. Any termination pursuant to this
Section 6(f) shall not in and of itself be, nor shall it be deemed to be, a
breach of this Agreement.
          (g) Resignation For Good Reason. Executive shall have the right to
resign his employment hereunder for Good Reason. For purposes of this Agreement,
Executive shall have “Good Reason” to resign his employment hereunder upon:
               (i) the material breach by the Company of any of its agreements
set forth herein and the failure of the Company to correct such breach within
thirty (30) days after the receipt by the Company of written notice from
Executive specifying in reasonable detail the nature of such breach; or
               (ii) except as consented to by Executive, any substantial or
material diminution of Executive’s responsibilities, including, without
limitation, reporting responsibilities and/or title.
     7. Termination Procedure.
          (a) Notice of Termination. Any termination of Executive’s employment
by the Company or by Executive (whether by resignation or otherwise) during the
Employment Period, except termination due to Executive’s death pursuant to
Section 6(a) above, shall be communicated by written Notice of Termination to
the other party hereto in accordance with Section 15 below. For purposes of this
Agreement, a “Notice of Termination” shall mean a notice that states the
specific termination provision in this Agreement relied upon and shall set forth
in reasonable detail the facts and circumstances claimed to provide a basis for
termination of Executive’s employment under the provision so stated. Any Notice
of Termination given by Executive shall be deemed a resignation by Executive as
an officer and employee of the

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Company and any subsidiary thereof and, if Executive is a member of the Board
(or any board of directors of any subsidiary) or any committee thereof (or of
any such board of directors), as such member; provided, however, that the Board
may, in its sole and absolute discretion, waive such resignation.
          (b) Date of Termination. The effective date of any termination of
Executive’s employment by the Company or by Executive (whether by resignation or
otherwise) (the “Date of Termination”) shall be (i) if Executive’s employment is
terminated by his death, the date of his death, and (ii) if Executive’s
employment is terminated for any other reason by the Company or by Executive
(whether by resignation or otherwise), the date on which a Notice of Termination
is given or any later date (within thirty (30) days after the giving of such
Notice of Termination) set forth in such Notice of Termination.
     8. Compensation Upon Termination or During Disability. If Executive
experiences a Disability or his employment terminates during the Employment
Period, the Company shall provide Executive with the payments and other benefits
(which, for the purposes of this Agreement, shall include, without limitation,
any accelerated or automatic vesting of any unvested shares of restricted stock
or of any unvested stock options) set forth below; provided, however, as a
specific condition to being entitled to any payments or other benefits under
this Section 8 (other than pursuant to clause (i) of Section 8(a)(i) and
Sections 8(a)(viii) and (ix), 8(b)(i), (ix) and (x) and 8(c)(i), (ii) and
(iii) hereof), Executive must, within fifty-five (55) days after the Date of
Termination, (a) have resigned as a director, trustee, officer and employee of
the Company and all of its subsidiaries and, if Executive is a member of the
Board (or any board of directors of any subsidiary) or any committee thereof (or
of any such board of directors), as such member and (b) have executed and
delivered to the Company a release of both the Company and Company Affiliates in
the form attached hereto as Exhibit A (and have not revoked such release for a
period of seven (7) days following its execution by Executive and its delivery
to the Company) (the conditions set forth in this proviso are hereafter
sometimes referred to collectively as the “Qualifying Conditions”). Executive
acknowledges and agrees that the payments and other benefits set forth in this
Section 8 constitute liquidated damages for termination of his employment during
the Employment Period, which the parties hereto have agreed to as being
reasonable, and Executive acknowledges and agrees that he shall have no other
remedies in connection with or as a result of any such termination and, except
as expressly set forth in this Agreement, shall not be entitled to any other
payments or benefits on account of or with respect to any such termination. As
used herein, “Entitlement Commencement Date” means the sixtieth (60th) day
following the Termination Date.
          (a) Disability; Death. During any period that Executive fails to
perform his duties hereunder as a result of a Disability, Executive shall
continue to be entitled to receive his full Base Salary as set forth (and
subject to the conditions) in Section 5(a) above and his full Bonus as set forth
(and subject to the conditions) in Section 5(b) above until his employment is
terminated pursuant to Section 6(b) above or otherwise as provided herein. In
addition, if on or after the Effective Date Executive’s employment is terminated
for Disability pursuant to Section 6(b) above or due to Executive’s death
pursuant to Section 6(a) above, then the following shall apply.

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               (i) The Company shall (A) as soon as practicable following the
Date of Termination pay to Executive or his estate, as the case may be, a lump
sum payment equal to his unpaid Base Salary and accrued vacation pay through the
Date of Termination and (B) subject to the Qualifying Conditions, from and after
the Entitlement Commencement Date continue to pay (retroactively from the Date
of Termination) to Executive or his estate, as the case may be, his Base Salary
through the earlier to occur of (I) the one hundred and twentieth (120th) day
following the Date of Termination or (II) the End of Term Date.
               (ii) Subject to the Qualifying Conditions, on the Entitlement
Commencement Date (A) all unvested Pre-Effective Stock Options shall fully vest
and (B) all unvested stock options granted to Executive on or after the
Effective Date and prior to the Date of Termination that would have vested
during the 90-day period following the Date of Termination and in any event on
or prior to the End of Term Date shall fully vest.
               (iii) Subject to the Qualifying Conditions, on the Entitlement
Commencement Date all unvested Pre-Effective Grant Shares shall fully vest.
               (iv) If the Termination Date is on or prior to December 31, 2012,
then, subject to the Qualifying Conditions, on the Entitlement Commencement Date
the First Tranche Fraction (as hereinafter defined) of the First Tranche Shares
and the Second Tranche Fraction (as hereinafter defined) of the Second Tranche
Shares shall vest. If the Termination Date is after December 31, 2012 but on or
prior to December 31, 2014, then, subject to the Qualifying Conditions, on the
Entitlement Commencement Date the Second Tranche Fraction of the Second Tranche
Shares shall vest. As used in this Section 8(a), “First Tranche Fraction” means
a fraction (which shall not be greater than one (1)), the numerator of which is
the number of days that have elapsed from January 1, 2011 through the Date of
Termination and the denominator of which is seven hundred and thirty (730) and
“Second Tranche Fraction” means a fraction (which shall not be greater than one
(1)), the numerator of which is the number of days that have elapsed from
January 1, 2011 through the Date of Termination and the denominator of which is
one thousand four hundred and sixty-one (1,461).
               (v) Subject to the Qualifying Conditions, on the Entitlement
Commencement Date a portion, equal to the product of the Applicable Contingent
Fraction (as hereinafter defined) times the Benchmark Fraction (as hereinafter
defined), of any Contingent Grant Shares that are unvested as of the Date of
Termination shall vest. As used in this Section 8(a),
“Applicable Contingent Fraction” means, with respect to any Contingent Grant
Shares, a fraction (which shall not be greater than one (1)), the numerator of
which is the number of days that have elapsed from January 1, 2011 through the
Date of Termination and the denominator of which is one thousand four hundred
and sixty-one (1,461), and
“Benchmark Fraction” means: (i) if the Primary Benchmark has been achieved for
the period from the Effective Date through the Date of Termination, one (1);
(ii) if the Secondary Benchmark has been achieved for the period from the
Effective Date through the Date of Termination,

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one-half (1/2); or (iii) if neither the Primary Benchmark nor the Secondary
Benchmark has been achieved for the period from the Effective Date through the
Date of Termination, zero (0).
               (vi) All other unvested stock options and unvested shares of the
Company’s restricted stock granted to Executive prior to the Date of Termination
will not vest and will be forfeited, returned to the Company and, at the
Company’s election, may be cancelled by the Company (with it being agreed and
understood, for avoidance of doubt, that, if the Current Employment Agreement is
terminated pursuant to the terms thereof prior to the Effective Date, none of
the shares of the Company’s restricted stock that are granted and issued under
this Agreement as part of the Non-Contingent Grant or the Contingent Grant will
be or become vested and all of such shares of the Company’s restricted stock
will be forfeited, returned to the Company and, at the Company’s election, may
be cancelled by the Company).
               (vii) Subject to the Qualifying Conditions, during the 90-day
period following the Date of Termination or, if earlier, through the End of Term
Date, the Company shall maintain in full force and effect, for the continued
benefit of Executive (if his employment is terminated for Disability) and
Executive’s spouse and dependents (subject to their qualifying therefor) the
medical, hospitalization, dental and life insurance programs in which Executive,
his spouse and his dependents were participating immediately prior to the Date
of Termination at the level in effect and upon substantially the same terms and
conditions (including, without limitation, contributions required by Executive
for such benefits) as existed immediately prior to the Date of Termination;
provided, that, if Executive, his spouse or his dependents (subject to their
qualifying therefor) cannot continue to participate in the Company programs
providing such benefits, the Company shall (subject to the next following
sentence) arrange to provide Executive (if his employment is terminated for
Disability) and Executive’s spouse and dependents (subject to their qualifying
therefor) with the economic equivalent of such benefits that they otherwise
would have been entitled to receive under such plans and programs. The Company
shall only be obligated to pay or incur an aggregate amount up to $30,000 per
annum (pro rated for any period less that a year) in so arranging to provide
Executive (if his employment is terminated for Disability) and Executive’s
spouse and dependents (subject to their qualifying therefor) with the economic
equivalent of such benefits that they otherwise would have been entitled to
receive under such plans and programs.
               (viii) The Company shall reimburse Executive or his estate, as
the case may be, pursuant to Section 5(d) above, for reasonable expenses
incurred by Executive, but not reimbursed, prior to the Date of Termination.
               (ix) Executive or his estate or named beneficiaries shall be
entitled to such other rights, compensation and/or benefits as may be due to
Executive or his estate or named beneficiaries in accordance with the terms and
provisions of any other agreements, plans or programs of the Company (provided,
however, that, to the extent that any such agreement, plan or program makes
provision with respect to any of the matters referred to in the foregoing
clauses (i) through (viii), the provisions of such clauses shall supersede and
govern).
          (b) Termination By Company Without Cause, Termination by Executive for
Good Reason. If Executive’s employment is terminated by the Company without
Cause or

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Executive terminates his employment with the Company for Good Reason, then the
following shall apply.
               (i) The Company shall pay to Executive his unpaid Base Salary and
accrued vacation pay through the Date of Termination, as soon as practicable
following the Date of Termination.
               (ii) Subject to the Qualifying Conditions, on the Entitlement
Commencement Date the Company shall pay to Executive a lump-sum payment equal to
the lesser of (A) an amount equal to Executive’s then current Base Salary for
the balance of the Employment Period without giving effect to an earlier
termination of the Employment Period or this Agreement based on the termination
of Executive’s employment or (B) an amount equal to Executive’s average annual
Bonus, if any, for the three most recently completed calendar years plus two
(2) times Executive’s then current Base Salary (provided, however, that, if a
Change in Control shall have occurred within twelve (12) months prior to the
Date of Termination, the amount provided for in this clause (B) shall be
increased to an amount equal to Executive’s average annual Bonus, if any, for
the three most recently completed calendar years plus two and nine-tenths (2.9)
times Executive’s then current Base Salary).
               (iii) Subject to the Qualifying Conditions, on the Entitlement
Commencement Date all unvested stock options granted to Executive prior to the
Date of Termination that would have vested on or prior to the End of Term Date
shall fully vest.
               (iv) Subject to the Qualifying Conditions, on the Entitlement
Commencement Date all unvested Pre-Effective Grant Shares shall fully vest.
               (v) Subject to the Qualifying Conditions, on the Entitlement
Commencement Date all unvested Non-Contingent Shares shall fully vest.
               (vi) If the Termination Date is before December 31, 2014, then,
subject to the Qualifying Conditions, on the Entitlement Commencement Date a
portion, equal to the product of the Applicable Contingent Fraction (as
hereinafter defined) times the Benchmark Fraction (as hereinafter defined), of
any Contingent Grant Shares that are unvested as of the Date of Termination
shall vest. As used in this Section 8(b),
“Applicable Contingent Fraction” means, with respect to any Contingent Grant
Shares, a fraction (which shall not be greater than one (1)), the numerator of
which is the number of days that have elapsed from January 1, 2011 through the
end of the Fraction Measurement Period (as hereinafter defined) and the
denominator of which is one thousand four hundred and sixty-one (1,461), and
“Benchmark Fraction” means: (i) if the Primary Benchmark has been achieved for
the period from the Effective Date through the Date of Termination, one (1);
(ii) if the Secondary Benchmark has been achieved for the period from the
Effective Date through the Date of Termination, one-half (1/2); or (iii) if
neither the Primary Benchmark nor the Secondary

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Benchmark has been achieved for the period from the Effective Date through the
Date of Termination, zero (0).
               (vii) All other unvested stock options and unvested shares of the
Company’s restricted stock granted to Executive prior to the Date of Termination
will not vest and will be forfeited, returned to the Company and, at the
Company’s election, may be cancelled by the Company (with it being agreed and
understood, for avoidance of doubt, that, if the Current Employment Agreement is
terminated pursuant to the terms thereof prior to the Effective Date, none of
the shares of the Company’s restricted stock that are granted and issued under
this Agreement will be or become vested and all of such shares of the Company’s
restricted stock will be forfeited, returned to the Company and, at the
Company’s election, may be cancelled by the Company). In addition and for the
avoidance of doubt, if the Date of Termination shall occur prior to the last day
of a calendar year, no Bonus shall be payable to Executive with respect to such
calendar year.
               (viii) Subject to the Qualifying Conditions, during the
Continuation Period (as hereinafter defined), the Company shall maintain in full
force and effect, for the continued benefit of Executive, his spouse and his
dependents (subject to their qualifying therefor) the medical, hospitalization,
dental and life insurance programs in which Executive, his spouse and his
dependents were participating immediately prior to the Date of Termination at
the level in effect and upon substantially the same terms and conditions
(including, without limitation, contributions required by Executive for such
benefits) as existed immediately prior to the Date of Termination; provided,
that, if Executive, his spouse or his dependents (subject to their qualifying
therefor) cannot continue to participate in the Company programs providing such
benefits, the Company shall (subject to the next following sentence) arrange to
provide Executive, his spouse and his dependents (subject to their qualifying
therefor) with the economic equivalent of such benefits that they otherwise
would have been entitled to receive under such plans and programs. The Company
shall only be obligated to pay or incur an aggregate amount up to $30,000 per
annum (pro rated for any period less that a year) in so arranging to provide
Executive, his spouse and his dependents with the economic equivalent of such
benefits that they otherwise would have been entitled (subject to their
qualifying therefor) to receive under such plans and programs.
               (ix) The Company shall reimburse Executive, pursuant to Section
5(d) above, for reasonable expenses incurred by Executive, but not reimbursed,
prior to the Date of Termination.
               (x) Executive shall be entitled to such other rights,
compensation and/or benefits as may be due to Executive in accordance with the
terms and provisions of any other agreements, plans or programs of the Company
(provided, however, that, to the extent that any such agreement, plan or program
makes provision with respect to any of the matters referred to in the foregoing
clauses (i) through (viii), the provisions of such clauses shall supersede and
govern).
For the purposes of this Section 8(b), “Fraction Measurement Period” means the
period beginning on the Date of Termination and ending on the second (2nd)
anniversary of the Date of Termination or, if earlier, the End of Term Date;
provided, however, that, if a Change in Control

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shall have occurred within twelve (12) months prior to the Date of Termination,
the “Fraction Measurement Period” means the period beginning on the Date of
Termination and ending on the third (3rd) anniversary of the Date of Termination
or, if earlier, the End of Term Date, and “Continuation Period” means the period
beginning on the Date of Termination and ending on the last day of the 18th
month following the Date of Termination or, if earlier, the End of Term Date.
          (c) Termination by the Company for Cause or By Executive Other Than
For Good Reason. If Executive’s employment is terminated by the Company for
Cause or on account of Executive’s resignation other than for Good Reason, then
the following shall apply:
               (i) The Company shall pay Executive his unpaid Base Salary and,
to the extent required by law or the Company’s vacation policy, his accrued
vacation pay through the Date of Termination, as soon as practicable following
the Date of Termination.
               (ii) The Company shall reimburse Executive, pursuant to Section
5(d) above, for reasonable expenses incurred by Executive, but not reimbursed,
prior to the Date of Termination, unless such termination resulted from a
misappropriation of Company funds.
               (iii) Executive shall be entitled to such other rights,
compensation and/or benefits as may be due to Executive in accordance with the
terms and provisions of any other agreements, plans or programs of the Company
(provided, however, that, to the extent that any such agreement, plan or program
makes provision with respect to any of the matters referred to in the foregoing
clauses (i) and (ii) and clause (iv) below, the provisions of such clauses shall
supersede and govern).
               (iv) All unvested stock options and unvested shares of the
Company’s restricted stock granted to Executive prior to the Date of Termination
will not vest and will be forfeited, returned to the Company and, at the
Company’s election, may be cancelled by the Company (with it being agreed and
understood, for avoidance of doubt, that, if the Current Employment Agreement is
terminated pursuant to the terms thereof prior to the Effective Date, none of
the shares of the Company’s restricted stock that are granted and issued under
this Agreement as part of the Non-Contingent Grant or the Contingent Grant will
be or become vested and all of such shares of the Company’s restricted stock
will be forfeited, returned to the Company and, at the Company’s election, may
be cancelled by the Company). In addition and for the avoidance of doubt, if the
Date of Termination shall occur prior to the last day of a calendar year, no
Bonus shall be payable to Executive with respect to such calendar year.
Notwithstanding anything to the contrary contained in this Section 8 or
elsewhere in this Agreement, to the extent the Company has any obligation
hereunder to maintain, for the continued benefit of Executive, his spouse and/or
his dependents, any medical, hospitalization, dental and/or life insurance
programs or to arrange to provide Executive, his spouse and/or his dependents
with the economic equivalent of such benefits, such obligation shall (except to
the extent prohibited under applicable law) immediately cease and terminate with
respect to any such programs or benefits that are provided or are offered or
made available by an employer or other third party to Executive, his spouse
and/or his dependents; and Executive (or, in the event of his death, his estate
or legal representative) shall forthwith advise the Company in writing as

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soon as any such programs or benefits are so provided, or are so offered or made
available, to Executive, his spouse and/or his dependents.
          (d) Bonus. If the termination of Executive’s employment hereunder
occurs as of or after the end of any calendar year of the Company for which a
Bonus is payable to Executive pursuant to Section 5(b) above and Executive’s
termination occurs prior to the date such Bonus is paid for such calendar year,
Executive (or his estate, as the case may be) shall be entitled to payment of
such Bonus that is earned for such calendar year without regard to whether
Executive’s termination of employment precedes the date such Bonus is payable
pursuant to the terms of this Agreement.
          (e) Tax Compliance Delay in Payment. If the Company reasonably
determines that any payment or benefit due under this Section 8, or any other
amount that may become due to Executive after termination of employment, would
result in an excise tax to Executive under Section 409A of the Internal Revenue
Code of 1986 (“Code”), as amended, because Executive is a “specified employee,”
as defined in Code Section 409A, upon termination of Executive’s employment for
any reason other than death (whether by resignation or otherwise), no amount may
be paid to Executive earlier than six months after the date of termination of
Executive’s employment and payment shall be made, or commence to be made, as the
case may be, on the date that is six months and one day after the termination of
Executive’s employment, together with interest at the rate of five percent (5%)
per annum beginning with the date one day after the Date of Termination until
the date of payment.
          (f) Expiration of this Agreement. For the avoidance of doubt, the
parties confirm that, upon the expiration of the Employment Period, the
non-renewal of this Agreement or the termination of Executive’s employment
hereunder for any reason or for no reason shall not be considered a termination
by Company without Cause or termination by Executive for Good Reason, and except
as herein otherwise expressly provided, Executive shall not be entitled to any
termination payments or other benefits as a consequence thereof.
          (g) Options. Executive shall have the right to exercise all vested
stock options within the six (6) month period immediately following Executive’s
termination of employment; provided, however, that, in the event Executive
voluntarily terminates his employment for other than Good Reason or the Company
terminates Executive’s employment for Cause, Executive shall only have ninety
(90) days following termination of his employment to exercise such stock
options. Notwithstanding anything in the foregoing to the contrary, neither the
six-month period nor the 90-day period referred to in the immediately preceding
sentence shall be deemed to extend the expiration date of any stock option
beyond the date stated in such stock option, and such stock option shall no
longer be exercisable upon the lapse of such six-month period or 90-day period,
as may be applicable, or (if sooner) upon the date specified in such stock
option.
     9. Repayment By Executive. Executive acknowledges and agrees that the
bonuses and other incentive-based or equity-based compensation received by him
from the Company, and any profits realized from the sale of securities of the
Company, are subject to the forfeiture and clawback requirements set forth in
the Sarbanes-Oxley Act of 2002 and other applicable laws, rules and regulations,
under the circumstances set forth therein. If any such forfeiture or clawback is
required pursuant to the Sarbanes-Oxley Act of 2002 or other applicable law,
rule or

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regulation, then within thirty (30) days after notice thereof from the Company,
Executive shall pay to the Company the amount required to be repaid or
forfeited.
     10. Confidential Information; Ownership of Documents and Other Property.
          (a) Confidential Information. Without the prior written consent of the
Company, except as may be required by law, Executive will not, at any time,
either during or after his employment by the Company, directly or indirectly
divulge or disclose to any person, entity, firm or association, including,
without limitation, any future employer, or use for his own or others’ benefit
or gain, any financial information, prospects, customers, tenants, suppliers,
clients, sources of leads, methods of doing business, intellectual property,
plans, products, data, results of tests or any other trade secrets or
confidential materials or like information of the Company, including (but not by
way of limitation) any and all information and instructions, technical or
otherwise, prepared or issued for the use of the Company (collectively, the
“Confidential Information”), it being the intent of the Company, with which
intent Executive hereby agrees, to restrict him from dissemination or using any
like information that is not readily available to the general public.
          (b) Information is Property of Company. All books, records, accounts,
tenant, customer, client and other lists, tenant, customer and client street and
e-mail addresses and information (whether in written form or stored in any
computer medium) relating in any manner to the business, operations or prospects
of the Company and any of its subsidiaries, whether prepared by Executive or
otherwise coming into Executive’s possession, (all of the foregoing are
hereinafter referred to collectively as the “Company Records”) shall be the
exclusive property of the Company and shall be returned to the Company
immediately upon the expiration or termination of Executive’s employment or at
the Company’s request at any time. Upon the expiration or termination of his
employment, Executive will immediately deliver to the Company all lists, books,
records, schedules, data and other information (including all copies) of every
kind relating to or connected with the Company and its activities, business and
customers.
     11. Restrictive Covenant; Notice of Activities.
          (a) Non-Competition. During the Employment Period and for a period of
one (1) year after the expiration or termination of Executive’s employment,
whether by resignation or otherwise, (except if Executive’s employment is
terminated by the Company without Cause or by Executive for Good Reason or
results from the non-renewal of this Agreement or failure of a Successor
Employer to assume and be bound by this Agreement) Executive shall not, without
the prior written consent of the Board, directly or indirectly, (i) enter into
the employment of, render any services to, invest in, lend money to, engage,
manage, operate, own or otherwise offer other assistance to, or participate in,
as an officer, director, manager, employee, principal, proprietor,
representative, stockholder, member, partner, associate, consultant or
otherwise, any person or entity that competes, plans to compete or is
considering competing with the Company in any business of the Company existing
or proposed at the time Executive shall cease to perform services hereunder (a
“Competing Entity”) in any state or with respect to any region of the United
States, in either case in which the Company conducts material operations
(defined as accounting for 10% or more of the Company’s revenue), or owns assets
the value of which totals 10% or more of the total value of the Company’s
assets, at any time during the term of this

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Agreement (collectively, the “Territory”). Notwithstanding the foregoing,
Executive shall be permitted to own up to a five percent (5%) equity interest in
a publicly traded Competing Entity
          (b) Non-Interference with Business Relationships. During the
Employment Period and for a period of one (1) year after the expiration or
termination of Executive’s employment, for any reason whatsoever and whether by
resignation or otherwise, Executive shall not, without the prior written consent
of the Board, directly or indirectly, (i) interfere with or disrupt or diminish
or attempt to disrupt or diminish, or take any action that could reasonably be
expected to disrupt or diminish, any past or present or prospective
relationship, contractual or otherwise, between the Company (or any of its
subsidiaries) and any tenant, customer, supplier, sales representative,
consultant or employee of the Company (or any of its subsidiaries) or
(ii) solicit for employment or attempt to employ, or assist any other person or
entity in employing or soliciting for employment, either on a full-time or
part-time or consulting basis, any employee (whether salaried or otherwise,
union or non-union) of the Company (or any of its subsidiaries) who within one
year prior thereto had been employed by the Company (or any of its
subsidiaries).
          (c) Return of Confidential Information and Company Property. Executive
shall not upon expiration or termination of this Agreement take or retain any
document or other medium that constitutes, contains or represents any
Confidential Information or Company Record, and as soon as reasonably possible
following any such expiration or termination, Executive shall deliver to the
Company (i) all Confidential Information and Company Records (including all
copies and excerpts thereof) and (ii) any and all property of the Company or its
subsidiaries in Executive’s possession or control, including any codes, manuals,
cellular telephones, computers, palm pilots, software, hardware, floppy disks,
corporate credit cards, keys, electronic beeper or other electronic device, data
and other documents and materials that was provided or made available to
Executive for the conduct of his duties hereunder during his employment or other
retention by the Company or any of its subsidiaries, whether during or prior to
the term of this Agreement.
          (d) Notice and Procedure. Executive shall, prior to accepting any
employment or engagement with any person or entity, inform such person or entity
in writing of his noncompetition obligations under this Agreement. Executive
shall also inform the Company in writing of such prospective employment or
engagement prior to accepting such employment or engagement. If the Company or
Executive has any concerns that any of Executive’s proposed or actual
post-employment activities may be restricted by, or otherwise in violation of,
this Section 11, such party shall notify the other party of such concerns and,
prior to the Company commencing any action to enforce its rights under this
Section 11 or Executive seeking a declaratory judgment with respect to his
obligations under this Section 11, the Company and Executive shall meet and
confer to discuss the prospective employment or engagement and shall provide the
other party with an opportunity to explain why such prospective employment or
engagement either does or does not violate this Section 11; provided, however,
that the Company’s obligations to give notice under this clause and to meet with
Executive before commencing any action shall not apply if Executive has not
provided notice before engaging in activities that the Company reasonably
believes violate this Section 11. Any such meeting shall occur within three
business days of notice and may be held in person or by telephonic, video
conferencing or similar electronic means.

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     12. Violations of Covenants.
          (a) Injunctive Relief. Executive agrees and acknowledges (i) that the
services to be rendered by him hereunder are of a special and original character
that gives them unique value, (ii) that the provisions of Sections 10 and 11
above are, in view of the nature of the business of the Company, reasonable and
necessary to protect the legitimate interests of the Company and its
subsidiaries, (iii) that his violation of any of the covenants or agreements
contained in such Sections would cause irreparable injury to the Company and its
subsidiaries, (iv) that the remedy at law for any violation or threatened
violation thereof would be inadequate, and (v) that, in the event of any
violation or threatened violation thereof, the Company shall be entitled to
temporary and permanent injunctive or other equitable relief as it may deem
appropriate without the accounting of all earnings, profits and other benefits
arising from any such violation, which rights shall be cumulative and in
addition to any other rights or remedies available to the Company. Executive
hereby further agrees that, in the event of any such violation or threatened
violation, the Company shall be entitled to commence an action, suit or
proceeding in any court of appropriate jurisdiction (which, notwithstanding
anything to the contrary in Section 17 below, need not be any Circuit Court of
the State of Florida or the United States District Court for the Southern
District of Florida or any other court located in Miami-Dade County, Florida)
for any such preliminary and permanent injunctive relief and other equitable
relief and shall not be required, as a condition to seeking or obtaining any
such relief, to provide any bond or other surety, which Executive hereby
expressly waives.
          (b) Enforcement. The Company and Executive recognize that the laws and
public policies of the various states of the United States and the District of
Columbia may differ as to the validity and enforceability of certain of the
provisions contained herein. Accordingly, if any provision of this Agreement
shall be deemed to be invalid or unenforceable, as may be determined by a court
of competent jurisdiction, this Agreement shall be deemed to delete or modify,
as necessary, the offending provision and to alter the balance of this Agreement
in order to render the same valid and enforceable to the fullest extent
permissible as aforesaid.
          (c) Survival. The provisions of this Section 12 and of Sections 10 and
11 above shall survive the expiration or earlier termination of this Agreement
for any reason whatsoever.
     13. Insurance.
          (a) Key Man Life Insurance. Executive agrees to facilitate the Company
to purchase and maintain “Key Man Insurance” in an amount desired by the Company
for the benefit of the Company and to reasonably cooperate with the Company and
its designated insurance agent to facilitate the purchase and maintenance of
such insurance.
          (b) Insurance Policies for Executive. The Company shall promptly (and,
in any event, within thirty (30) days following receipt from Executive of
written evidence of Executive’s having made expenditures therefor) reimburse
Executive (up to an aggregate maximum of $25,000 in any year) for premiums paid
by Executive for life, disability and/or similar insurance policies.

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     14. Successors; Binding Agreement.
          (a) Company’s Successors. No rights or obligations of the Company
under this Agreement may be assigned or transferred except that the Company will
require a Successor Employer to expressly assume and agree to perform this
Agreement in the same manner and to the same extent that the Company would be
required to perform it if no such succession had taken place.
          (b) Executive’s Successors. No rights or obligations of Executive
under this Agreement may be assigned or transferred other than his rights to
payments or benefits hereunder, which may be transferred only by will or the
laws of descent and distribution. Upon Executive’s death, this Agreement and all
rights of Executive hereunder shall inure to the benefit of and be enforceable
by, and shall be binding upon and enforceable against, Executive’s beneficiary
or beneficiaries, personal or legal representatives, or estate, to the extent
any such person succeeds to Executive’s interests under this Agreement.
Executive shall be entitled to select and change a beneficiary or beneficiaries
to receive any benefit or compensation payable hereunder following Executive’s
death by giving the Company written notice thereof. In the event of Executive’s
death or a judicial determination of his incompetence, references in this
Agreement to Executive shall be deemed, where appropriate, to refer to his
beneficiary(ies), estate or other legal representative(s). If Executive should
die following the Date of Termination while any amounts would still be payable
to him hereunder if he had continued to live, all such amounts unless otherwise
provided herein shall be paid in accordance with the terms of this Agreement to
such person or persons so appointed in writing by Executive or otherwise to his
legal representatives or estate.
     15. Notice. All notices or other communications that are required or
permitted hereunder shall be in writing and sufficient if delivered personally,
or sent by nationally-recognized, overnight courier or by registered or
certified mail, return receipt requested and postage prepaid, addressed as
follows:

     
To the Company:
  Equity One, Inc.
1600 NE Miami Gardens Drive
North Miami Beach, Florida 33179
Attention: General Counsel
 
   
 
  With copies to:
 
   
 
  The Chair of the Compensation Committee
 
   
 
  and to
 
   
 
  Herbert F. Kozlov, Esq.
Reed Smith LLP
599 Lexington Avenue
New York, New York 10022

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To Executive:
  Mr. Thomas A. Caputo
23 Chieftans Road
Greenwich, CT 06831
(or such other address as may be provided in the Company’s payment records)
 
   
 
  With a copy to:
 
   
 
  Jack A. Gordon, Esq.
Kent, Beatty & Gordon, LLP
425 Park Avenue, The Penthouse
New York, NY 10022

or to such other address as either party may have furnished to the other in
writing in accordance herewith. All such notices and other communications shall
be deemed to have been received (a) in the case of personal delivery, on the
date of such delivery, (b) in the case of delivery by nationally-recognized,
overnight courier, on the business day following dispatch, and (c) in the case
of mailing, on the third business day following such mailing.
     16. Attorneys’ Fees. The Company shall reimburse Executive for the
reasonable attorneys’ fees and costs incurred by Executive in connection with
the review, negotiation and execution of this Agreement. If either party is
required to seek legal counsel to interpret or enforce the terms and provisions
of this Agreement, the prevailing party in any action, suit or proceeding shall
be entitled to recover reasonable attorneys’ fees and costs (including on
appeal).
     17. Miscellaneous and Waiver of Jury Trial. No provisions of this Agreement
may be amended, modified or waived unless such amendment or modification is
agreed to in writing signed by Executive and by a duly authorized officer of the
Company or such waiver is set forth in writing and signed by the party to be
charged therewith. No waiver by either party hereto at any time of any breach by
the other party hereto of any condition or provision of this Agreement to be
performed by such other party shall be deemed a waiver of similar or dissimilar
provisions or conditions at the same or at any prior or subsequent time. No
agreements or representations, oral or otherwise, express or implied, with
respect to the subject matter hereof have been made by either party that are not
set forth expressly in this Agreement. Except as herein otherwise provided, the
respective rights and obligations of the parties hereto under this Agreement
shall survive the expiration or termination of Executive’s employment (whether
by resignation or otherwise) and the expiration or termination of this Agreement
to the extent necessary for the intended preservation of such rights and
obligations. The validity, interpretation, construction and performance of this
Agreement shall be governed by the laws of the State of Florida without regard
to its conflicts of law principles. Each party unconditionally and irrevocably
agrees that the exclusive forum and venue for any action, suit or proceeding
shall be in Miami-Dade County, Florida, and consents to submit to the exclusive
jurisdiction, including, without limitation, personal jurisdiction, and forum
and venue of the Circuit Courts of the State of Florida or the United States
District Court for the Southern District of Florida, in each case, located in
Miami-Dade County, Florida. EACH OF THE PARTIES HERETO EXPRESSLY WAIVES ITS OR
HIS RIGHT TO A JURY TRIAL WITH RESPECT TO

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ANY SUIT, LITIGATION OR OTHER JUDICIAL PROCEEDING REGARDING THIS AGREEMENT OR
ANY DISPUTE HEREUNDER OR RELATING HERETO.
     18. Validity. The invalidity or unenforceability of any provision or
provisions of this Agreement shall not affect the validity or enforceability of
any other provision of this Agreement, which shall remain in full force and
effect. In the event that any provision or provisions contained in this
Agreement shall be deemed illegal or unenforceable, the remaining provisions
contained in this Agreement shall remain in full force and effect, and this
Agreement shall be interpreted as if such illegal or unenforceable provision or
provisions were not contained in this Agreement, subject, however, to Section
12(b) above, which to the extent applicable shall supersede and govern.
     19. Counterparts. This Agreement may be executed in two or more
counterparts, each of which shall be deemed to be an original, but all of which
together will constitute one and the same instrument.
     20. Entire Agreement. This Agreement sets forth the entire agreement of the
parties hereto in respect of the subject matter contained herein and supersedes
all prior agreements, promises, covenants, arrangements, communications,
representations or warranties, whether oral or written, by any officer,
director, employee or representative of either party hereto in respect of such
subject matter. For purposes of clarification and avoidance of any doubt,
(a) notwithstanding anything contained herein to the contrary unless otherwise
specifically provided herein, the terms and conditions of Executive’s employment
by the Company and termination (including payments upon termination) through
January 31, 2011 and prior to the Effective Date are and shall continue to be
governed by the terms and conditions set forth in the Current Employment
Agreement, but thereafter the terms and conditions of Executive’s employment by
the Company and termination (including payments upon termination) shall be
governed by the terms and conditions of this Agreement, which terms and
conditions shall, from and after the Effective Date, supersede and control and
(b) notwithstanding anything contained herein to the contrary, if the Current
Employment Agreement is terminated prior to the Effective Date in accordance
with the terms thereof, (i) Executive’s entitlement to any payment on account of
or with respect to such termination shall be governed solely by the terms of the
Current Employment Agreement, (ii) from and after the Effective Date, the
Current Agreement (to the extent it otherwise shall not have been terminated
prior thereto) shall be deemed to have been amended and restated as provided
herein and the Company’s obligations and liabilities to Executive from and after
the Effective Date shall be limited to those expressly provided herein and
(iii) the Company shall have no continuing obligations or liabilities to
Executive under or pursuant to the Current Agreement. From and after the
Effective Date, in the event of any conflict or inconsistency between the terms
and conditions of this Agreement and the terms and conditions of the Current
Agreement, of any stock option or restricted stock agreement or plan relating
thereto or of any other separate agreement, the terms and conditions of this
Agreement shall supersede, govern and prevail.
     21. Withholding. All payments hereunder shall be subject to any required
withholding of Federal, state and local taxes pursuant to any applicable law or
regulation.

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     22. Insurance; Indemnity. Executive shall be covered by the Company’s
directors’ and officers’ liability insurance policy, and errors and omissions
coverage, to the extent such coverage is generally provided by the Company to
its directors and officers and to the fullest extent permitted by such insurance
policies. Nothing herein is or shall be deemed to be a representation by the
Company that it provides, or a promise by the Company to obtain, maintain or
continue, any liability insurance coverage whatsoever for its executives. In
addition, the Company shall enter into its standard indemnity agreement by which
Company commits to indemnify a Company officer in connection with claims, suits
or proceedings arising as a result of Executive’ service to the Company.
     23. Section Headings. The section headings in this Agreement are for
convenience of reference only, and they form no part of this Agreement and shall
not affect its interpretation.
[Remainder of this Page Intentionally left Blank]

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The parties hereto have executed this Agreement effective as provided above.

            EQUITY ONE, INC.
      By  /s/ Jeffrey S. Olson       Name: Jeffrey S. Olson      Title:   Chief
Executive Officer              /s/ Thomas A. Caputo       THOMAS A. CAPUTO   

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