EXHIBIT 10.1

HOME PROPERTIES, INC.

NONQUALIFIED VOLUNTARY DEFERRED COMPENSATION PLAN

Article 1

Purpose and Term

1.1 Purpose. The purpose of the Plan is to provide certain members of management
and highly compensated employees of the Company with an opportunity to elect to
defer the receipt of a portion of their Eligible Compensation.

1.2 Effective Date. The Plan was approved by the Committee on November 1, 2011,
and by the Board on November 2, 2011. Deferrals of Eligible Compensation are
permitted beginning with Eligible Compensation earned on or after January 1,
2012.

Article 2

Definitions

2.1 “Account” means a booking account established by the Company to reflect a
Participant’s benefits under the Plan, and as applicable, means a Deferral
Account or a Company Contribution Account.

2.2 “Affiliate” means any person other than Home Properties with whom Home
Properties would be considered a single employer under Sections 414(b) or 414(c)
of the Code; provided, however, that for determining whether a Separation from
Service has occurred, the language “at least 50 percent” shall be used instead
of “at least 80 percent” each place it appears in such Code Sections.

2.3 “Applicable Guidance” means Section 409A of the Code, the Treasury
Regulations promulgated thereunder and other applicable guidance issued by the
Treasury Department or the Internal Revenue Service with respect thereto.

2.4 “Base Salary” means the annual base cash compensation relating to services
performed by a Participant during any Plan Year. Base Salary shall be calculated
before reduction for compensation voluntarily deferred or contributed by the
Participant pursuant to any plan of the Company.

2.5 “Beneficiary” means, with respect to a Participant, the person or persons
designated in accordance with the provisions of Article 9 as a beneficiary of
such Participant hereunder.

2.6 “Board” means the Board of Directors of Home Properties.

 

--------------------------------------------------------------------------------

2.7 “Change of Control” means a change that is a change in the ownership, a
change in the effective control or a change in the ownership of a substantial
portion of the assets of Home Properties, each as defined in the Applicable
Guidance, provided that such change also satisfies one of the following:

(a) a change of a nature that would be required to be reported in response to
Item 6(e) of Schedule 14A of Regulation 14A or to Item 5.01 of Form 8-K
promulgated under the Securities Exchange Act of 1934, as amended;

(b) any “person” (as such term is used in Sections 13(d) and 14(d)(2) of such
Act) is or becomes the beneficial owner, directly or indirectly, of securities
of Home Properties representing 30% or more of the combined voting power of Home
Properties’s then outstanding securities; or

(c) during any period of 24 consecutive months, individuals who at the beginning
of such period constitute the Board cease for any reason to constitute at least
a majority thereof unless the election, or the nomination for election by Home
Properties’s shareholders, of each new director was approved by a vote of at
least two-thirds of the directors then still in office who were directors at the
beginning of the period.

2.8 “Code” means the Internal Revenue Code of 1986, as amended.

2.9 “Committee” shall mean the Compensation Committee or such other committee
appointed from time to time by the Board to administer the Plan. The Committee
shall at all times serve at the pleasure of the Board and the Board may, in its
sole and absolute discretion, reconstitute the Committee or supervise, advise or
direct the activities of the Committee. If at any time the Board has not
appointed or has abolished the Committee, the Board shall act as the Committee.
A reference herein to the Committee with respect to a right or duty of the
Committee shall be deemed to include any person to whom such right or duty of
the Committee has been delegated pursuant to Section 10.2.

2.10 “Company” means Home Properties and its Affiliates, collectively.

2.11 “Company Contribution” is defined in Section 5.1.

2.12 “Company Contribution Account” means the bookkeeping account established by
the Company pursuant to Section 5.2.

2.13 “Deferral Account” means the bookkeeping account established by the Company
pursuant to Section 4.6.

2.14 “Deferral Election” means an election by an Eligible Employee for a Plan
Year pursuant to Section 4.1 or 4.9.

2.15 “Designation Date” means the date or dates as of which a designation of
investment directions by a Participant pursuant to Section 6.1, or any change in
a prior designation of investment directions by a Participant pursuant to
Section 6.1, shall become effective. The Designation Date in any Plan Year shall
be determined by the Committee;

 

2

--------------------------------------------------------------------------------

provided, however, that each trading day of the New York Stock Exchange shall be
available as a Designation Date unless the Committee selects different
Designation Dates.

2.16 “Disability” means a condition of a Participant whereby he or she either:
(a) is unable to engage in any substantial gainful activity by reason of any
medically determinable physical or mental impairment which can be expected to
result in death or can be expected to last for a continuous period of not less
than 12 months, or (b) is, by reason of any medically determinable physical or
mental impairment which can be expected to result in death or can be expected to
last for a continuous period of not less than 12 months, receiving income
replacement benefits for a period of not less than three months under an
accident and health plan covering employees of Home Properties. The Committee
will determine whether a Participant has incurred a Disability based on its own
good faith determination and may require a Participant to submit to reasonable
physical and mental examinations for this purpose. A Participant will also be
deemed to have incurred a Disability if he or she is determined to be totally
disabled by the Social Security Administration or in accordance with a
disability insurance program, provided that the definition of disability applied
under such disability insurance program complies with the requirements of
Section 1.409A-3(i)(4) of the Treasury Regulations and the Applicable Guidance.

2.17 “Effective Date” means January 1, 2012.

2.18 “Eligible Compensation” means a Participant’s Base Salary for the Plan
Year.

2.19 “Eligible Employee” means an individual who is a member of a select group
of management or highly compensated employees of the Company.

2.20 “Entry Date” means, with respect to a Participant, the first
January 1, April 1, July 1 or October 1 following or coinciding with the date on
which the individual first becomes an Eligible Employee. Notwithstanding the
foregoing, for any individual who first becomes an Eligible Employee on or
before the Effective Date, his or her Entry Date shall be January 1, 2012.

2.21 “ERISA” means the Employee Retirement Income Security Act of 1974, as
amended.

2.22 “Home Properties” means Home Properties, Inc., a Maryland corporation, and
its successors and assigns.

2.23 “Investment Agent” means the person appointed by the Committee to invest
the Accounts of Participants, or if no person is so appointed, the Committee
itself.

2.24 “Participant” means any Eligible Employee or former Eligible Employee who
has a balance in his or her Accounts.

2.25 “Payment Event” means, with respect to the Deferral Account for a given
Plan Year, the permissible dates or events for the payment of that Deferral
Account pursuant to Section 4.4.

 

3

--------------------------------------------------------------------------------

2.26 “Plan” means this Home Properties Nonqualified Voluntary Deferred
Compensation Plan, as amended from time to time.

2.27 “Plan Year” means the 12-month period beginning on January 1 of each
calendar year and ending on December 31 of such calendar year. The first Plan
Year shall be January 1, 2012 to December 31, 2012.

2.28 “Separation from Service” means a Participant’s termination of employment
with the Company, whether voluntary or involuntary, within the meaning of
Section 409A(a)(2)(A)(i) of the Code and the Applicable Guidance.

2.29 “Treasury Regulations” means the tax regulations, including temporary and
proposed regulations, promulgated under the Code.

Article 3

Eligibility and Participation

3.1 Eligible Employees. Participation in the Plan shall be limited to designated
Eligible Employees. For each Plan Year, the Committee may select from the
Eligible Employees, in its sole discretion, the employees who shall be eligible
to become Participants with respect to that Plan Year. The Committee may make
separate selections with respect to eligibility for Deferral Elections and
Company Contributions. The Committee’s selection of an employee to make a
Deferral Election with respect to a particular Plan Year will not entitle that
employee to make a Deferral Election with respect to any subsequent Plan Year,
unless the employee is selected by the Committee to make a Deferral Election
with respect to such subsequent Plan Year. The allocation of a Company
Contribution to a Participant shall not entitle that employee to future Company
Contributions, unless the employee is again selected by the Committee to receive
a Company Contribution with respect to such subsequent Plan Year. Unless the
Committee provides otherwise, the Eligible Employees shall be each employee of
the Company who is a “highly compensated employee” as that term is defined in
Section 414(q) of the Code.

3.2 Requirements. Every Eligible Employee designated by the Committee shall
become a Participant for purposes of Deferral Elections on the first Entry Date
occurring on or after the date on which he or she is designated as a
Participant. No employee shall become a Participant, however, if he or she is
not an Eligible Employee on the date that his or her participation is to begin.
Participation in the Plan is voluntary. In order to begin participation in the
Deferral Election portion of the Plan, an Eligible Employee must make a Deferral
Election in accordance with Section 4.1 or 4.9. Notwithstanding the foregoing,
an Eligible Employee shall become a Participant in the Company Contribution
portion of the Plan no later than the date on which a Company Contribution is
allocated to a Company Contribution Account for the benefit of such Eligible
Employee.

 

4

--------------------------------------------------------------------------------

Article 4

Compensation Deferrals

4.1 Deferral Election. A Participant for a Plan Year may make a Deferral
Election with respect to his or her Eligible Compensation for that Plan Year.
Deferral Elections shall be made in accordance with the rules established by the
Committee. A Deferral Election with respect to Eligible Compensation must be
made no later than the date required by Section 4.2, or such earlier deadline
established by the Committee. A Deferral Election for a Plan Year shall specify:

(a) subject to Sections 2.18 and 4.3, the amount or percentage of Eligible
Compensation that the Participant wishes to defer for that Plan Year;

(b) subject to Section 4.4, the Payment Event for the Deferral Account for that
Plan Year;

(c) whether the Deferral Account for that Plan Year will be distributed in a
lump sum, or two to 10 installments; and

(d) such other information as may be required by the Committee.

A Participant’s Deferral Election for a Plan Year shall only apply to the Plan
Year to which it relates. If the Participant is an Eligible Employee for a
subsequent Plan Year and wishes to make a Deferral Election for that Plan Year,
the Participant must make a separate Deferral Election for that subsequent Plan
Year.

4.2 Limitations on Time of Deferral Election.

(a) Except as otherwise permitted by the Applicable Guidance, a Deferral
Election with respect to Eligible Compensation earned during a given Plan Year
must be irrevocably made on or before December 31st (or such earlier date
designated by the Committee) of the calendar year immediately preceding the Plan
Year in which the Eligible Compensation is earned and to which the Deferral
Election applies.

(b) Notwithstanding the foregoing, a newly eligible Participant may make an
initial Deferral Election within 30 days of the date that the Participant first
becomes eligible to participate in the Plan, however, deferrals pursuant to such
an interim Deferral Election may be made only with respect to Base Salary earned
after the Participant’s Deferral Election becomes irrevocable. This initial
eligibility rule shall not apply if the Participant is, or ever has been,
eligible to participate in another deferred compensation plan sponsored by the
Company that is an “account balance plan” under the plan aggregation rules of
the Applicable Guidance.

4.3 Minimum and Maximum Deferrals. The Committee may from time to time designate
for a given Plan Year a minimum or maximum deferral amount or percentage of
Eligible Compensation applicable with respect to that Plan Year. Unless the
Committee designates otherwise for a Plan Year, the minimum deferral of Eligible
Compensation shall be a deferral of 1% of each payment of Base Salary, and the
maximum deferral of Eligible Compensation shall be 50% of each payment of Base
Salary.

 

5

--------------------------------------------------------------------------------

4.4 Payment Event. The Committee may from time to time designate for a given
Plan Year the permissible Payment Events applicable with respect to the Deferral
Accounts for that Plan Year. Unless the Committee designates otherwise for a
given Plan Year, a Payment Event may be either: (a) the first day of a calendar
quarter on the third, fifth or tenth Plan Year following the Plan Year to which
the Deferral Election applies; or (b) the six-month anniversary of the
Participant’s Separation from Service.

4.5 Form of Payment. Except as otherwise provided by Sections 7.4, 7.5 or 8.1, a
Participant’s Deferral Account for a given Plan Year will be distributed in a
lump sum or in two to 10 annual installments, in accordance with the
Participant’s Deferral Election for that Plan Year.

4.6 Deferral Account. For each Plan Year for which a Participant makes a
Deferral Election, there shall be established and maintained a separate Deferral
Account in the name of the Participant for that Plan Year, to which shall be
credited the amount of the Eligible Compensation deferred by such Participant
for such Plan Year, and any earnings thereon, and from which shall be debited
the amount of any losses thereon (such earnings and losses determined in
accordance with Article 6) and the amount of any distributions made to the
Participant therefrom.

4.7 Vesting. A Participant shall at all times be 100% vested in amounts credited
to his or her Deferral Account.

4.8 Subsequent Changes to Payment Event or Form of Payment. The Committee may
permit a Participant to change the Payment Event or form of payment (i.e., lump
sum or installments) for his or her Deferral Account for a given Plan Year. In
addition, the Committee may impose terms and conditions on the ability of a
Participant to change such Payment Event or form of payment. Provided, however,
that a Participant may elect to change the Payment Event or form of payment only
if the election (a) is not made less than 12 months prior to the date of the
first scheduled payment, (b) does not take effect until 12 months after the date
on which such election is made, and (c) specifies that the payment with respect
to which such election is made be deferred for a period of not less than five
years from the date such payment would otherwise have been made (in the case of
an election related to payment other than in the event of death or Disability).

4.9 Tandem Deferral Elections.

(a) For Plan Years beginning on or after January 1, 2012, a Participant may
elect to make a Deferral Election that is coordinated with his or her election
under the Home Properties’s 401(k) Plan. Such Deferral Election under the Plan
shall indicate that the Participant authorizes a distribution from the Plan to
be transferred to the Home Properties’s 401(k) Plan. Such transfer, if made,
shall comply with the prohibition on contingent benefits set forth in
Section 1.401(k)-1(e)(6) of the Treasury Regulations. In addition, the
Participant must make an election with respect to the Home Properties’s 401(k)
Plan to elect to defer the maximum amount he or she is permitted to defer
without violation the ADP and/or ACP test. This election must be made prior to
the beginning of the Plan Year to which it relates.

 

6

--------------------------------------------------------------------------------

(b) At such time as Home Properties determines the maximum deferral amount a
Participant in this Plan can defer under Home Properties’s 401(k) Plan without
violation the ADP and/or ACP test applied to Home Properties’s 401(k) Plan, such
amount will be transferred from this Plan to the Participant’s deferral
subaccount under such plan. Any such elective deferrals shall be transferred
into Home Properties’s 401(k) Plan by March 15th following the close of the
calendar year to which they relate.

(c) The Committee shall limit any modifications to amounts deferred under this
Plan in order to comply with Section 1.409A-2(a)(9) of the Treasury Regulations.

Article 5

Company Contributions

5.1 Company Contributions. The Company, with the express prior consent of the
Committee, may make discretionary contributions to any Participant under this
Plan at the times and in the amount(s) designated by the Committee, in its sole
and absolute discretion. Amounts so credited will be considered a Participant’s
“Company Contributions.”

5.2 Company Contribution Account. For each Plan Year for which a Company
Contribution is credited to a Participant, there shall be established and
maintained a separate Company Contribution Account in the name of the
Participant to which shall be credited the amount of the Company Contribution
and any earnings thereon, and from which shall be debited the amount of any
losses thereon (such earnings and losses determined in accordance with Article
6) and the amount of any distributions made to the Participant therefrom.

5.3 Payment Event and Form of Payment. At the time that the Company makes a
Company Contribution, it shall provide the Payment Event and form of payment for
the Participant’s Company Contribution Account for the Plan Year. The Committee
may allow Participants to designate the Payment Event or form of payment of a
Company Contribution Account for a Plan Year, so long as such designation is
made in accordance with the Applicable Guidance.

5.4 Vesting. Amounts credited to the Company Contribution Account shall become
vested or forfeitable at such time or upon the occurrence of such events as the
Committee may designate at the time the Company Contribution is made. Any
Participant that experiences a Separation from Service prior to full vesting
shall irrevocably forfeit the portion not vested at the time of Separation from
Service. Notwithstanding the foregoing, if there is a Change of Control of Home
Properties, or a Participant dies or incurs a Disability prior to vesting, all
amounts credited to his or her Company Contribution Account shall become 100%
vested.

 

7

--------------------------------------------------------------------------------

Article 6

Maintenance of Accounts

6.1 Investment Directions of Participants for Accounts.

(a) Subject to such limitations, operating rules and procedures as may from time
to time be required by law; imposed by the Committee or its designees; or
contained elsewhere in the Plan, each Participant may communicate to the
Investment Agent a direction (in accordance with Section 6.1(b)) as to how his
or her Accounts should be deemed to be invested among such categories of
investments as may be made available by the Committee hereunder. (Unless the
Committee provides otherwise, the investments under this Plan shall be the same
as the investments available under the Home Properties’s 401(k) Plan other than
the Company Stock Fund.) The Participant’s investment directions shall designate
the percentage (in any whole percent multiples) of the portion of the subsequent
contributions to the Participant’s Accounts which is requested to be deemed to
be invested in such categories of investments, and shall be subject to the rules
set forth below. The Investment Agent shall invest the assets of the
Participant’s Accounts in accordance with the directions of the Participant
except to the extent that the Committee directs it to the contrary. The
Committee has the authority but not the requirement, in its sole and absolute
discretion, to direct that a Participant’s Accounts be invested among such
investments as it deems appropriate and advisable, which investments need not be
the same for each Participant.

(b) Any initial or subsequent investment direction shall be in writing to the
Investment Agent on a form supplied by the Home Properties, or, as permitted by
the Investment Agent, may be by oral designation and/or electronic transmission
designation to the Investment Agent. A designation shall be effective as of the
Designation Date next following the date the direction is received and accepted
by the Investment Agent or as soon thereafter as administratively practicable,
subject to the Committee’s right to override such direction. The Participant
may, if permitted by the Committee, make an investment direction to the
Investment Agent for his or her existing Accounts as of a Designation Date and a
separate investment direction to the Investment Agent for contribution credits
to his or her Accounts occurring after the Designation Date.

(c) All amounts credited to a Participant’s Accounts shall be invested in
accordance with the then effective investment direction, unless the Committee
directs otherwise. Unless otherwise changed by the Committee, an investment
direction shall remain in effect until the Participant’s Accounts are
distributed or forfeited in their entirety, or until a subsequent investment
direction is received and accepted by the Investment Agent.

(d) If a Participant files an investment direction with the Investment Agent for
his or her existing Accounts as of a Designation Date which is received and
accepted by the Investment Agent and not overridden by the Committee, then the
Participant’s existing Accounts shall be deemed to be reallocated as of the next
Designation Date (or as soon thereafter as administratively practicable) among
the designated investment funds according to the percentages specified in such
investment direction. Unless otherwise changed by the Committee, an investment
direction shall remain in effect until the Participant’s Accounts are
distributed or

 

8

--------------------------------------------------------------------------------

forfeited in their entirety, or until a subsequent investment direction is
received and accepted by the Investment Agent.

(e) If the Investment Agent receives an initial or subsequent investment
direction with respect to Accounts which it deems to be incomplete, unclear or
improper, or which is unacceptable for some other reason (determined in the sole
and absolute discretion of the Investment Agent), the Participant’s investment
direction for such Accounts then in effect shall remain in effect (or, in the
case of a deficiency in an initial investment direction, the Participant shall
be deemed to have filed no investment direction) until the Participant files an
investment direction for such Accounts acceptable to the Investment Agent.

(f) If the Investment Agent does not possess valid investment directions
covering the full balance of a Participant’s Accounts and/or subsequent
contributions thereto (including, without limitation, situations in which no
investment direction has been filed, situations in which the investment
direction is not acceptable to the Investment Agent under Section 6.1(e), or
situations in which some or all of the Participant’s designated investments are
no longer permissible Plan investments), the Participant shall be deemed to have
directed that the undesignated portion of the Accounts be invested in a
money-market fund or similar short-term investment fund.

(g) None of the Company, or its directors and employees shall have any liability
whatsoever for the investment of a Participant’s Accounts, or for the investment
performance of a Participant’s Accounts. Each Participant hereunder, as a
condition to his or her participation hereunder, agrees to indemnify and hold
harmless the Company, its directors and employees (including, without
limitation, each member of the Committee), and their agents and representatives,
from any losses or damages of any kind (including, without limitation, lost
opportunity costs) relating to the investment of a Participant’s Accounts. The
Investment Agent shall have no liability whatsoever for the investment of a
Participant’s Accounts, or for the investment performance of a Participant’s
Accounts, other than as a result of the failure to follow a valid and effective
investment direction. Each Participant hereunder, as a condition to his or her
participation hereunder, agrees to indemnify and hold harmless the Investment
Agent, and its agents and representatives, from any losses or damages of any
kind (including, without limitation, lost opportunity costs) relating to the
investment of a Participant’s Accounts, other than as a result of the failure to
follow a valid and effective investment direction.

(h) Each reference in this Section 6.1 to a Participant shall be deemed to
include, where applicable, a reference to his or her Beneficiary.

6.2 Continued Investment of Undistributed Amounts. If the whole or any part of a
Participant’s Accounts are to be paid in installments, the undistributed portion
shall continue to be deemed to be invested pursuant to Article 6 under such
procedures as the Committee may establish, in which case any deemed income,
gain, loss or expense or tax allocable thereto shall be reflected in the
installment payments, in such equitable manner as the Committee shall determine.

6.3 Accounting for Distributions. A distribution from one of a Participant’s
Accounts shall be charged to the Account from which it is made.

 

9

--------------------------------------------------------------------------------

6.4 Expenses and Taxes. Expenses, including Investment Agent fees, associated
with the administration or operation of the Plan shall be paid by the Company
from its general assets and not from Plan Accounts; provided, however, any check
or processing fee imposed by a third-party administrator of the Plan with
respect to a distribution to a Participant shall be the sole responsibility of
that Participant, and such fee shall be deducted from that Participant’s
distribution. In addition, taxes owed on a distribution shall be the sole
responsibility of the Participant or Beneficiary to whom such distribution is
made.

Article 7

Distribution of Benefits

7.1 Amount. The amount of any benefit payment due under this Plan shall
generally be determined on the basis of the value of the Participant’s Deferral
Account and vested Company Contribution Account as of the most recent valuation
date practicable before distribution.

7.2 Installment Payment Calculation. In the event that a Participant’s Account
is payable in installments, the amount of each installment shall be calculated
using the fractional method (i.e., by multiplying the remaining balance by a
fraction, the numerator of which is one and the denominator of which is the
number of installment payments remaining).

7.3 Generally. Except as otherwise provided by this Article 7, payment of a
Participant’s Deferral Account or Contribution Account for a Plan Year shall be
made in a lump sum, or two to 10 annual installments, in accordance with the
Participant’s Deferral Election or Company designation, as applicable for that
Account for that Plan Year, as follows:

(a) if the Participant elected for a Deferral Account to be paid upon the
six-month anniversary of the Participant’s Separation from Service, or the
Company designated a Company Contribution Account to be paid upon the six-month
anniversary of the Participant’s Separation from Service, then subject to
Section 7.4, payment shall be made or commence on the six-month anniversary of
the Participant’s Separation from Service, or as soon as administratively
practicable thereafter, but in no event later than 90 days thereafter; and

(b) if the Participant elected for a Deferral Account to be paid upon a
specified date, or the Company designated a Company Contribution Account to be
paid upon a specified date, then subject to Section 7.4, payment shall be made
or commence on such specified date, or as soon as administratively practicable
thereafter, but in no event later than December 31st of the year in which the
specified date occurs.

7.4 Small Account Balances. If a Participant’s Accounts have a value less than
$25,000 at the time of his or her Separation from Service, then the
Participant’s entire Account shall be paid to him or her in a lump sum as soon
as administratively practical following the six-month anniversary of the
Participant’s Separation from Service, but in no event later than 90 days
thereafter.

7.5 Payment in Event of Death or Disability. In the event the Participant dies
or incurs a Disability, then the Participant’s Accounts shall be paid to the
Participant (or in the case

 

10

--------------------------------------------------------------------------------

of the Participant’s death, to the Participant’s Beneficiary) in a lump sum as
soon as administratively feasible following the date of the Participant’s death
or Disability, but in no event later than 90 days thereafter.

7.6 Medium of Payment. Distributions from a Participant’s Accounts shall be made
in cash.

7.7 Section 162(m) of the Code. As permitted by Applicable Guidance, if any
scheduled payment to a Participant under this Plan during a taxable year of the
Company would, in combination with other compensatory payments to that
Participant during such year, result in the Participant’s compensation exceeding
the $1 million cap under Section 162(m) of the Code, the Company shall defer
payment to the first subsequent year when the Participant’s compensation will
not exceed the $1 million cap. Such payments shall be made in a manner as
consistent as possible with the Participant’s original Deferral Election.

Article 8

Change of Control

8.1 Payment in Event of Change of Control. In the event of a Change of Control
of Home Properties, the balance of all Participants’ Accounts under the Plan as
of the date of the Change of Control shall be paid to the Participants in a lump
sum as soon as administratively feasible following the Change of Control, but in
no event later than 90 days thereafter.

Article 9

Beneficiaries; Participant Data

9.1 Designation of Beneficiaries.

(a) Each Participant may designate from time to time any person or persons (who
may be named contingently or successively) to receive such benefits as may be
payable under the Plan upon or after the Participant’s death, and such
designation may be changed from time to time by the Participant by filing a new
designation. Each designation will revoke all prior designations by the same
Participant once filed with the Committee or its designee, shall be made on a
form provided by the Committee or its designee for such purpose, and will be
effective only when filed in writing with the Committee or its designee during
the Participant’s lifetime.

(b) In the absence of a valid Beneficiary designation, or if, at the time any
benefit payment is due to a Beneficiary, there is no living Beneficiary validly
named by the Participant, the Committee or its designee shall direct
distribution of any such benefit payment to the Participant’s spouse, if then
living, but otherwise to the Participant’s then living descendants, if any, per
stirpes, but, if none, to the Participant’s estate. In determining the existence
or identity of anyone entitled to a benefit payment, the Committee or its
designee may rely conclusively upon information supplied by the Participant’s
personal representative, executor or administrator. If a question arises as to
the existence or identity of anyone entitled to receive a benefit payment as
aforesaid, or if a dispute arises with respect to any such payment, then,

 

11

--------------------------------------------------------------------------------

notwithstanding the foregoing, the Committee or its designee, in its sole and
absolute discretion, may direct the distribution of such payment to the
Participant’s estate without liability for any tax or other consequences which
might flow therefrom, or may take such other action as it deems to be
appropriate.

9.2 Information to Be Furnished By Participants and Beneficiaries; Inability to
Locate Participants or Beneficiaries. Any communication, statement or notice
addressed to a Participant or to a Beneficiary at his or her last post office
address as shown on the Company’s records shall be binding on the Participant or
Beneficiary for all purposes of the Plan. The Committee shall not be obliged to
search for any Participant or Beneficiary beyond the sending of a registered
letter to such last known address. If the Committee sends notice in this fashion
to any Participant or Beneficiary that he or she is entitled to an amount under
the Plan and the Participant or Beneficiary fails to claim such amount or make
his or her location known to the Committee within three years thereafter, then,
except as otherwise required by law, the Committee may, in complete satisfaction
of any claim by or through such Participant or Beneficiary, direct distribution
as if the Participant or Beneficiary had died or, if the Committee cannot locate
the person or persons who is the proper payee in the event of the Participant’s
or Beneficiary’s death, may direct that the amount payable shall be deemed to be
a forfeiture.

Article 10

Administration

10.1 Administrative Authority. The Committee shall administer the Plan. Except
as otherwise specifically provided herein, the Committee shall have the sole
responsibility for and the sole control of the operation and administration of
the Plan, and shall have the sole power, authority and discretion to take all
action and to make all decisions and interpretations which may be necessary or
appropriate in order to administer and operate the Plan, including, without
limiting the generality of the foregoing, the power, duty and responsibility to:

(a) establish, amend and rescind such rules and regulations relating to the
Plan;

(b) determine the terms of any agreements or forms under the Plan;

(c) make determinations with respect to the eligibility of any person to be an
Eligible Employee or Participant;

(d) make determinations concerning the crediting of Plan Accounts;

(e) determine the minimum or maximum amounts of Eligible Compensation that may
be deferred for any Plan Year;

(f) resolve and determine all disputes or questions arising under the Plan,
including without limitation determining the validity of any claim for benefits,
and to remedy any ambiguities, inconsistencies or omissions in the Plan; and

 

12

--------------------------------------------------------------------------------

(g) appoint any persons or firms, or otherwise act to secure specialized advice
or assistance, as it deems necessary or desirable in connection with the
administration and operation of the Plan.

10.2 Delegation. The Committee shall have the power and authority to delegate
from time to time by written instrument all or any part of its duties, powers or
responsibilities under the Plan, both ministerial and discretionary, as it deems
appropriate, to any person or committee, including, but not limited to the
Investment Agent, and in the same manner to revoke any such delegation of
duties, powers or responsibilities. Any action of such person or Committee in
the exercise of such delegated duties, powers or responsibilities shall have the
same force and effect for all purposes hereunder as if such action had been
taken by the Committee. Further, the Committee may authorize one or more persons
to execute any certificate or document on behalf of the Company, in which event
any person notified by the Committee of such authorization shall be entitled to
accept and conclusively rely upon any such certificate or document executed by
such person as representing action by the Company until such notified person
shall have been notified of the revocation of such authority.

10.3 Conflict of Interest. No person with authority under the Plan (including
without limitation a member of the Committee) who is also an Eligible Employee
or Participant shall participate in a decision on any matter relating
specifically to himself or herself. No Eligible Employee or Participant may be
the sole member of the Committee.

10.4 Multiple Capacities. Any person or group of persons may serve in more than
one capacity with respect to the Plan’s administration and without regard to
whether such person or persons are officers, directors, employees, agents, or
other representatives of the Company, or any person having an interest under the
Plan.

10.5 Liability. The Company, the Committee and any persons to whom
responsibilities have been delegated in connection with the administration of
the Plan shall not be liable to any person for any act or failure to act except
to the extent, and only to the extent, that liability is required by law. No
person shall be deemed to be a fiduciary with respect to the Plan. The Company,
from its own funds, may indemnify any person for liabilities incurred by him or
her in connection with the Plan.

10.6 Claims Procedure.

(a) The Committee shall establish procedures for reviewing claims for benefits
under the Plan. Such procedures shall be administered so as to comply with
regulations issued by the Department of Labor to the extent that such
regulations are applicable to the particular claim at issue. Any Claimant shall
have the right to be represented by another person in connection with his or her
benefit claim, provided that the Committee is provided with satisfactory
evidence that the representative has been authorized to act on behalf of the
Claimant. The Committee and its authorized designees have the authority and
discretion to administer and interpret the Plan and to decide claims for
benefits, and their decisions are binding on all parties to the maximum extent
permitted by law.

 

13

--------------------------------------------------------------------------------

(b) A Claimant shall present the claim, in writing, to the Committee, and the
Committee shall respond in writing. If the claim is denied, the written notice
of denial shall, in a manner calculated to be understood by the Claimant:
(i) state the specific reason or reasons for the denial, with specific
references to the Plan provisions on which the denial is based; (ii) describe
any additional material or information necessary for the Claimant to perfect his
or her claim and explain why such material or information is necessary;
(iii) explain the Plan’s claims review procedure; and (iv) state that the
Claimant has a right to file suit under Section 502(a) of ERISA if the claim is
denied on appeal. In the event of a claim for Disability benefits, the notice
shall also identify any internal protocol, policy or guideline relied upon or
state that such a protocol, policy or guideline was relied upon and will be
provided free of charge upon request, and provide an explanation of any
scientific or clinical judgment underlying a “medical necessity” or
“experimental treatment” determination (if any) or a statement that such a
determination was made and that an explanation will be provided free of charge
upon request.

(c) The written notice denying or granting the Claimant’s claim shall be
provided to the Claimant within 90 days (45 days, in the event of a claim for
Disability benefits) after the Committee’s receipt of the claim, unless special
circumstances require an extension of time for processing the claim. If such an
extension is required, written notice of the extension shall be furnished by the
Committee to the Claimant within the initial 90-day period (45-day period, in
the event of a claim for Disability benefits) and in no event shall such an
extension exceed a period of 90 days from the end of the initial 90-day period
(provided that, in the case of a claim for Disability benefits, the initial
extension shall not continue past the 30th day after the expiration of the
original 45-day period, with a second 30-day extension available upon proper
notice if necessary). Any extension notice shall indicate the special
circumstances requiring the extension and the date on which the Committee
expects to render a decision on the claim, and in the case of a claim for
Disability benefits, shall specify the standards under which entitlement to
benefits will be decided, the unresolved issues remaining, and the additional
information needed to resolve those issues, and shall grant the Disability
claimant at least 45 days to supply the necessary additional information.

(d) Any Claimant whose claim is denied and who wishes to appeal must, within 60
days after the Claimant’s receipt of notice of the denial, request a review of
the denial by notice given, in writing, to the Committee. Upon such a request
for review, the claim shall be given a full and fair review by the Committee,
which may, but shall not be required to, grant the Claimant a hearing. In
connection with the review, the Claimant may have representation, may examine
and receive copies (free of charge) of pertinent documents upon request, and may
submit issues and comments in writing. The Committee shall consider all
information and arguments presented, regardless of whether they were included in
the initial claim. In the event of a claim for Disability benefits, the decision
on review shall be made by a named fiduciary independent of the person who
denied the original claim, and that reviewing fiduciary shall not defer to the
initial review, shall provide for an independent medical review of any medical
judgments, and shall identify any medical or vocational experts whose advice was
obtained in connection with the claim. The Committee may choose to have one or
more members decide the initial claim and then recuse themselves from the
appellate process or may make other arrangements to ensure an independent review
of Disability claims.

 

14

--------------------------------------------------------------------------------

(e) The decision on review normally shall be made and communicated to the
Claimant in writing within 60 days (45 days, in the event of a claim for
Disability benefits) of the Committee’s receipt of the request for review. If an
extension of time is required due to special circumstances, the Claimant shall
be notified, in writing, by the Committee, and the time limit for the decision
on review shall be extended to up to 120 days (90 days, in the event of a claim
for Disability benefits). The written decision on review shall, in a manner
calculated to be understood by the Claimant: (i) state the reasons for the
decision; (ii) cite pertinent Plan provisions; (iii) inform the Claimant that he
or she is entitled, upon request and free of charge, reasonably to review and
receive copies of relevant documents, and (iv) inform the Claimant of his or her
right to bring suit under Section 502(a) of ERISA now that his or her claim has
been denied on appeal. In the event of a claim for Disability benefits, the
notice shall also identify any internal protocol, policy or guideline relied
upon or state that such a protocol, policy or guideline was relied upon and will
be provided free of charge upon request, and provide an explanation of any
scientific or clinical judgment underlying a “medical necessity” or
“experimental treatment” determination (if any) or a statement that such a
determination was made and that an explanation will be provided free of charge
upon request, and contain such other information as is required by the
Department of Labor regulations. All decisions on review shall be final and
binding with respect to all concerned parties.

(f) Notwithstanding the foregoing, unless otherwise required by law, the special
rules applicable to Disability claims shall not apply if the Plan terms or the
Committee’s uniformly-applicable policy require reliance exclusively on
determinations by the entity responsible for deciding such matters under Home
Properties’s long-term disability plan or determinations by the Social Security
Administration when deciding whether or not a Participant is Disabled.

(g) No person shall be entitled to file suit for benefits under this Plan until
he or she has exhausted all of the administrative remedies set forth in this
Section 10.6.

Article 11

Amendment & Termination

11.1 Right to Amend. Home Properties shall have the right to amend the Plan, at
any time and with respect to any provisions hereof, and all parties hereto or
claiming any interest hereunder shall be bound by such amendment; provided,
however, that no such amendment shall deprive a Participant or a Beneficiary of
a right accrued hereunder prior to the date of the amendment and no such
amendment shall cause the Plan to violate the Applicable Guidance.

11.2 Employer’s Right to Terminate or Suspend Plan. Home Properties reserves the
right to terminate the Plan and/or its obligation to make further credits to
Participants’ Accounts. Home Properties also reserves the right to suspend the
operation of the Plan for a fixed or indeterminate period of time.
Notwithstanding the foregoing, the termination or suspension of the Plan will
not cause the accelerated payment of Participants’ Accounts unless such payment
complies with the Applicable Guidance.

 

15

--------------------------------------------------------------------------------

Article 12

Miscellaneous

12.1 ERISA Status of Plan. The Plan is intended to be (a) a plan that is not
qualified within the meaning of Section 401(a) of the Code and (b) a plan that
“is unfunded and is maintained by an employer primarily for the purpose of
providing deferred compensation for a select group of management or highly
compensated employee” within the meaning of Sections 201(2), 301(a)(3) and
401(a)(1) of ERISA. The Plan shall be administered and interpreted to the extent
possible in a manner consistent with that intent. All Accounts and all credits
and other adjustments to such Accounts shall be bookkeeping entries only and
shall be utilized solely as a device for the measurement and determination of
amounts to be paid under the Plan. No Accounts, credits or other adjustments
under the Plan shall be interpreted as an indication that any benefits under the
Plan are in any way funded.

12.2 Section 409A of the Code. It is intended that the Plan (including all
amendments thereto) comply with provisions of the Applicable Guidance, so as to
prevent the inclusion in gross income of any benefits accrued hereunder in a
taxable year prior to the taxable year or years in which such amount would
otherwise be actually distributed or made available to the Participants. The
Plan shall be administered and interpreted to the extent possible in a manner
consistent with that intent. If under this Plan, an amount is to be paid in two
or more installments, for purposes of the Applicable Guidance, each installment
shall be treated as a separate payment.

12.3 Withholding Taxes.

(a) For each Plan Year in which a Deferral Election is being withheld from a
Participant, the Company shall withhold from that portion of the Participant’s
compensation that is not being deferred, in a manner determined in the sole
discretion of the Company, the Participant’s share of FICA and other employment
taxes on the amount of the Participant’s Eligible Compensation being deferred.
If necessary, the Company may reduce all or a portion of the Participant’s
Eligible Compensation being deferred in order to comply with this
Section 12.3(a).

(b) When a Participant becomes vested in a portion of his or her Company
Contribution Account, the Company shall withhold from the Participant’s
compensation that is not deferred, in a manner determined in the sole discretion
of the Company, the Participant’s share of FICA and other employment taxes on
such vested Company Contribution Account. If necessary, the Company may reduce
all or a portion of the Participant’s Eligible Compensation being deferred in
order to comply with this Section 12.3(b).

(c) For each Plan Year in which earnings are credited on the vested balance of a
Participant’s Accounts, the Company shall withhold from the Participant’s
compensation that is not deferred, in a manner determined in the sole discretion
of the Company, the Participant’s share of FICA and other employment taxes on
such credited earnings. If necessary, the Company may reduce all or a portion of
the Participant’s Eligible Compensation being deferred in order to comply with
this Section 12.3(c).

 

16

--------------------------------------------------------------------------------

(d) The Company shall be entitled to deduct from any payment under the Plan,
regardless of the form of such payment, the amount of all applicable federal,
state and local income, employment and other taxes required to be withheld by
the Company with respect to such payment, in a manner determined in the sole
discretion of the Company, provided that such manner complies with applicable
tax withholding requirements, or, to the extent permissible under the Applicable
Guidance, may require the Participant to pay to the Company such taxes prior to
and as a condition of the making of such payment.

12.4 No Guarantee of Tax Consequences. No person connected with the Plan in any
capacity, including, but not limited to, the Company and its directors,
officers, agents and employees, makes any representation, commitment, or
guarantee that any tax treatment, including, but not limited to, federal, state
and local income, estate and gift tax treatment, will be applicable to any
amounts deferred under the Plan, or paid to or for the benefit of a Participant
or Beneficiary under the Plan, or that such tax treatment will apply to or be
available to a Participant or Beneficiary on account of participation in the
Plan.

12.5 No Right to Continued Employment or Service. Participation in the Plan
shall not give any Participant the right to remain in the employment or service
of the Company. The Company reserves the right to terminate the employment or
service of a Participant at any time.

12.6 Construction. If any provision of the Plan is held to be illegal or void,
such illegality or invalidity shall not affect the remaining provisions of the
Plan, but shall be fully severable, and the Plan shall be construed and enforced
as if said illegal or invalid provision had never been inserted herein. For all
purposes of the Plan, where the context admits, the singular shall include the
plural, and the plural shall include the singular. Headings of Articles and
Sections herein are inserted only for convenience of reference and are not to be
considered in the construction of the Plan.

12.7 No Assignment. No amount payable to a Participant or a Beneficiary under
the Plan will, except as otherwise specifically provided by law, be subject in
any manner to anticipation, alienation, attachment, garnishment, sale, transfer,
assignment (either at law or in equity), levy, execution, pledge, encumbrance,
charge or any other legal or equitable process, and any attempt to do so will be
void; nor will any benefit be in any manner liable for or subject to the debts,
contracts, liabilities, engagements or torts of the person entitled thereto.

12.8 Other Plans and Agreements. Nothing in this Plan gives any person rights to
compensation to which he or she would not otherwise be entitled, nor does any
provision of this Plan expand or otherwise alter a Participant’s rights under
any other plan or agreement.

12.9 Governing Law. The Plan shall be governed by and construed in accordance
with the laws of the State of New York, except as superseded by applicable
federal law.

*  *  *  *  *

 

17