Unassociated Document


    FORM
OF

    PERFORMANCE
AWARDS AGREEMENT –

    ONE
LIBERTY PROPERTIES, INC. AND

    ____________________

    


    


    THIS AGREEMENT,is made and entered
into on _______, 2010 between One Liberty Properties, Inc., a Maryland
corporation (“Company”), and ___________, (“Participant”).

    


    WHEREAS, the Company has established
the One Liberty Properties, Inc. 2009 Incentive Plan (“Plan”);

    


    WHEREAS, the Compensation Committee
of the Board of Directors (“Committee”) and the Board of Directors has
determined to grant,pursuant to Section 8 of the Plan,Performance Awards in the
form of restricted stock units (“Units”) to the Participant payable upon the
attainment by the Company during the Performance Cycle of the Performance
Criteria established by the Committee as set forth in Exhibit A hereto and
made part hereof;

    


    WHEREAS, it is intended that this
award qualify as performance based compensation for the purposes of Section
162(m) of the Code.

    


    NOW THEREFORE, the parties hereby
agree as follows:

    


    
      	
               
      

            	
              1.

            	
              Definitions.Unless
      otherwise defined herein, all terms that are used herein that are defined
      in the Plan shall have the meanings given to such terms in the
      Plan.

            


    

    


    
      	
               
      

            	
              2.

            	
              Administration.  The
      Performance Awards shall be administered by the Committee with the powers
      and authority set forth in the
Plan.

            


    

    


    
      	
               
      

            	
              3.

            	
              Grant
      Date.  Pursuant to the Plan, the Company on
      ____  __, 2010 (the “Grant Date”) granted to the Participant a
      Performance Based Award in the form of ________ Units, subject to the
      terms and conditions of the Plan and subject to the terms and conditions
      set forth herein.

            


    

    


    
      	
               
      

            	
              4.

            	
              Accounts.Units
      granted to Participant shall be credited to an account (the “Account”)
      established and maintained for Participant by the Company.  A
      Participant’s Account shall be the record of Units granted to the
      Participant under the Plan, is solely for accounting purposes and shall
      not require a segregation of any Company
assets.

            


    

    


    
      	
               
      

            	
              5.

            	
              Terms and
      Conditions.  Except as otherwise provided herein, the
      Units shall remain non-vested and subject to substantial risk of
      forfeiture. If the Participant’s employment with the Company terminates
      for any reason during the Performance Cycle (other than as contemplated by
      Section 7), the Units shall be forfeited by the Participant and shall be
      null and void.

            


    

    


    
      	
               
      

            	
              6.

            	
              Issuance of
      Shares.As soon as practicable after the Units become vested and
      non-forfeitable, the Participant will be entitled to receive one share
      (the “Share” or “Shares”) of Company common stock for each vested
      Unit.  In the event that a fraction of a Share would be issued,
      the number of Shares to be issued shall be rounded to the nearest whole
      share.

            


    

    


    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

       

    

    
      	
               
      

            	
              7.

            	
              Vesting.The
      Units awarded to the Participant shall, except as otherwise provided
      herein,become vested and non-forfeitable to the extent, but only to the
      extent, that the applicable Performance Criteria set forth in Exhibit A have
      been satisfied at the end of the Performance Cycle (the “Vesting
      Date”).    Notwithstanding the forfeiture provision of
      Section 5 hereof, the interest of the Participant in the Units shall vest
      as follows:

            


    

    


    (a)           a
pro rata number of Units upon termination of the Participant’s employment due to
death, Disability or Retirement (collectively a “DDR Event”) during the
Performance Cycle, but only with respect to Units that would otherwise have
vested at the end of the Performance Cycle.  For the purposes of this
Section 7(a), the pro rata number of Units that shall vest shall equal the
product obtained by multiplying the total number of Units awarded pursuant to
this Agreement by a fraction, the numerator of which is the number of days
commencing July 1, 2010 and ending on the date of the DDR Event and the
denominator of which is the total number of days in the Performance
Cycle.

    


    (b)           All
of the Units shall vest upon a Change of Control if the effective date thereof
is after June 30, 2015.  If the effective date of the Change of
Control shall occur prior to or on June 30, 2015, a pro rata number of Units
shall vest upon such Change of Control.  For the purposes of this
Section 7(b), the pro rata number of Units that vest shall equal the product
obtained by multiplying the total number of Units awarded pursuant to this
Agreement by a fraction, the numerator of which is the number of days commencing
on July 1, 2010 and ending on the effective date of the Change of Control and
the denominator of which is the total number of days in the period commencing
July 1, 2010 and ending June 30, 2015.

    


    (c)           If
a Participant’s employment terminates due to a DDR Event and subsequent thereto
there is a Change of Control,then notwithstanding anything to the contrary
herein, the pro rata number of Units which shall vest and the number of Shares
which shall be issuable to the Participant, the Participant’s guardian, personal
representative or Estate on a Change of Control shall be equal to the product
obtained by multiplying the total number of Units which would have vested for
the Participant pursuant to Section 7(b) but for the DDR Event by a fraction,
the numerator of which is the number of days commencing July 1, 2010 and ending
on the date of the DDR Event and the denominator of which is the total number of
days in the period commencing on July 1, 2010 and ending on the effective date
of the Change of Control.

       


    
      	 	

              8.

            	

              

                Restrictions. 
      The Units awarded pursuant to this Agreement may not be sold, pledged or
      otherwise transferred and may not be subject to lien, garnishment,
      attachment or other legal
process.

              

            


    

     

    
      	
               
      

            	
              9.

            	
              Dividends. 
      Notwithstanding Section 5.3 of the Plan to the contrary, if at any time
      during the period between the date hereof and the date that the Units
      vest, the Company shall pay a dividend in cash,Shares or otherwise,the
      Participant shall not be entitled to receive any such dividend paid with
      respect to the Shares underlying the
Units.

            


    

    


    
      	
               
      

            	
              10.

            	
              Payment in the Event
      of Disability.  In the event of the Disability of the
      Participant, the Shares underlying Units which have vested and are
      issuable pursuant to this Agreement shall be paid to the Participant if
      Participant is legally competent or to a legally designated guardian or
      representative if the Participant is not legally
  competent.

            


    

    


    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

       

    

    
      	
               
      

            	
              11.

            	
              Death of
      Employee.  In the event of the Participant’s death, the Shares
      underlying the Units which have vested and are issuable pursuant to this
      Agreement shall be paid to the Participant’s estate, personal
      representative,or designated
beneficiary.

            


    

    


    
      	
               
      

            	
              12.

            	
              Taxes. 
      The Participant shall be liable for any and all taxes, including
      withholding taxes, arising out of this grant,the vesting of Units and the
      issuance of Shares hereunder.  In accordance with Section 10 of
      the Plan, the Participant may elect to satisfy such withholding tax
      obligation by having the Company retain Shares or delivering Shares then
      owned by a Participant having a Fair Market Value equal to the Company’s
      minimum withholding obligation.

            


    

    


    
      	
               
      

            	
              13.

            	
              Claw-back.  In
      the event that the Company has or is required to file a Current Report on
      Form 8-K pursuant to Item 4.02 thereof (or subsequent similar
      requirement)(a “Restatement 8-K”) prior to or on the third anniversary of
      the Vesting Date and as a result of the restatement contemplated by the
      Restatement 8-K, one or more of the Performance Criteria set forth herein
      would not have been satisfied, the Non-Entitled Shares (as defined) shall
      be redeemed by the Company for an aggregate consideration of $1.00 and the
      Participant or his guardian, representative, estate or beneficiary shall
      immediately deliver the applicable stock certificate or certificates
      representing the Non-Entitled Shares to the Company and execute any and
      all documents to transfer the Non-Entitled Shares back to the
      Company.  The term “Non-Entitled Shares” means the Shares that,
      after giving effect to the restatement contemplated by the Restatement
      8-K, would not have been issued because the Performance Criteria pursuant
      to which such Shares were issued were not satisfied or were satisfied at a
      different Performance Criteria
threshold.

            


    

    


    
      	
               
      

            	
              14.

            	
              Post-Vesting
      Restrictions on Transferability - In the event all or some of the
      Units vest and Shares are issued,fifty percent (50%) of the issued Shares
      may not be sold, transferred, pledged, hypothecated or otherwise disposed
      of until the third anniversary of the Vesting Date.The foregoing
      restriction shall not be applicable to, and shall lapse, upon a DDR Event
      or a Change of Control.

            


    

    


    
      	
               
      

            	
              15.

            	
              Miscellaneous

            


    

     

    (a)           All
Units credited to the Participant’s Account under this Agreement shall continue
for all purposes to be a part of the general assets of the Company.

    


    (b)           Neither
this Agreement nor the granting or vesting of Units shall confer upon the
Participant any right to continue in the employ of the Company or an affiliate,
nor shall it interfere in any way with the right of the Company or an affiliate
to terminate Participant’s employment at any time.

    


    (c)           The
parties agree to execute such further documents and instruments and to take such
action as may reasonably be necessary to carry out the intent of this Agreement,
including without limitation the imposition of appropriate legends on the Shares
and the issuance of “stop transfer” orders to implement the restrictions imposed
herein, including the limitations imposed pursuant to Sections 13 and 14
hereof.

    


    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

       

    

    (d)           This
Award shall be governed by the laws of the State of Maryland (without regard to
its choice of law principles) and applicable Federal law.

    


    (e)           Except
as otherwise provided herein, in any event of any conflict between the
provisions of the Plan as in effect on the Grant Date and the provisions of this
Award, the provisions of the Plan shall govern.  All references herein
to the Plan shall mean the Plan as in effect on the Grant Date.

    


    


    ONE
LIBERTY PROPERTIES, INC.

       

    By:
_________________________

       


    ____________________________

    Signature
of Participant

       

    ____________________________

    Name of
Participant

    


    


    


    (10/olp/PERFORMANCEAWARDSAGREEMENTSEPT7)

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    EXHIBIT
A

    


    PERFORMANCE
CRITERIA

    


    The
number of Restricted Stock Units (“Units”) that shall vest, if any, will be
determined by the Compensation Committee as soon as practicable after the
completion of a seven year Performance Cycle, (which shall commence July 1, 2010
and June 30, 2017) using the following Performance Criteria:

    


    Return on
Capital:  One-half of the awarded Units, or an aggregate of _________
Units, are subject to an average annualized return on capital metric for the
period from July 1, 2010 – June 30, 2017.  In order for all of the
Units subject to the return on capital metric to vest and for the underlying
______ shares of the Company’s common stock be issued to the Participant, the
average annualized return on capital for the seven year Performance Cycle must
be at least 10%.  In order for a portion of these Units to vest and
for underlying shares of the Company’s common stock to be issued with respect to
the Units which vest, the average annualized return on capital for the
Performance Cycle must exceed 8%.  If the average annualized return
exceeds 8%, but is less than 10% for the Performance Cycle, then a pro rata
number of Units shall vest and the underlying shares of the Company’s common
stock with respect to the Units which vest will be issued.  Return on
capital will be based upon adjusted funds from operations
(AFFO).  AFFO is defined as funds from operations (FFO) determined in
accordance with the National Association of Real Estate Investment Trusts
definition, adjusted for straight-line rent accruals and amortization of lease
intangibles.  Capital is defined as stockholders’ equity, plus
depreciation and amortization, adjusted for intangibles.

    


    Total
Stockholder Return:  One-half of the awarded Units, or an aggregate of
_______ Units, are subject to a total stockholder return metric averaged for the
period from July 1, 2010-June 30, 2017.  Each year (July 1st through
the following June 30th) total
stockholder return for such year shall be calculated using the following
formula:  the closing price per share on the NYSE of the Company’s
common stock at the end of the measuring period (the applicable June 30th) minus
the closing price per share on the NYSE of the Company’s common stock at the
start of the measuring period (the applicable July 1st) plus
all dividends paid during the measuring period shall be divided by the closing
price per share on the NYSE of the Company’s common stock at the commencement of
the measuring period (the applicable July 1st).  Once
total stockholder return has been calculated for each of the seven years in the
performance cycle, an average of such seven year total stockholder return shall
be determined.  In order for all of these Units to vest and the
underlying shares of the Company’s common stock to be issued, the average
annualized total stockholder return for the seven year period must be 13%, and
for a portion of the Units to vest and the underlying shares of the Company’s
common stock be issued, the average annualized total stockholder return for the
seven year period must exceed 10.25%.  If the average annualized total
shareholder return exceeds 10.25%, but is less than 13% for the seven year
period, then a pro rata number of Units shall vest and the underlying shares of
the Company’s common stock with respect to the Units which vest shall be
issued.