AMENDED AND RESTATED EMPLOYMENT AGREEMENT

     AMENDED  AND  RESTATED  EMPLOYMENT  AGREEMENT  ("Agreement"),  dated  as of
December  7,  2001,   between  WELLSFORD  REAL  PROPERTIES,   INC.,  a  Maryland
corporation  with offices at 535 Madison  Avenue,  New York, New York 10022 (the
"Company"),  and JEFFREY H. LYNFORD,  an individual  residing at 10 Holly Branch
Road, Katonah, NY 10536 (the "Executive").

     WHEREAS, the Company and the Executive are party to an Employment Agreement
dated as of May 30, 1997 (the "Original Agreement");

     WHEREAS, the Company desires to ensure the services of the Executive beyond
the term of employment provided for in the Original Agreement;

     WHEREAS, the Company and the Executive have agreed to modify the employment
benefits  to be  received  by the  Executive  in the  event  his  employment  is
terminated  as a result of, or in  connection  with,  a change in control of the
Company, as hereinafter defined, and to provide the Executive with certain other
benefits whether or not the Executive's employment is terminated.

     WHEREAS,  the  Company  and the  Executive  desire to amend and restate the
Original Agreement;

     NOW, THEREFORE for good and valuable  consideration received by the parties
hereto.

     IT IS AGREED:

     1. Duties. (a) During the term of the Executive's  employment hereunder the
Executive  shall serve and the Company shall employ the Executive as Chairman of
the Board and from and after  April 1, 2002,  as  Chairman  of the Board,  Chief
Executive  Officer and  President  to perform such  executive or  administrative
services for the Company  consistent with those of a Chairman of the Board,  and
from and after April 1, 2002, a Chief Executive  Officer and President as may be
assigned  to the  Executive  by the  Board  of  Directors  of the  Company  (the
"Board").  The Executive  hereby  accepts such  employment and agrees to perform
such services.

     (b) The Executive shall devote substantially all of his time, attention and
energies during business hours to the performance of his duties  hereunder.  The
foregoing shall not be construed to prevent  Executive from devoting time during
business hours to charitable and civic endeavors.


     (c) The Executive shall cooperate with the Company,  including  taking such
medical  examinations as the Company  reasonably  shall deem  necessary,  if the
Company  shall  desire to obtain  medical,  disability  or life  insurance  with
respect to the Executive. Where reasonably possible, the Company shall cooperate
with the Executive's request to have such examinations

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performed by the Executive's  personal physician or another physician reasonably
acceptable to the Executive.

     (d) The  Executive  shall  not be  required  to  relocate  or  conduct  the
Company's  business  outside the New York, New York area in order to perform his
duties under this Agreement but shall undertake such reasonable  business travel
as may be  necessary to perform  said duties (for which the  Executive  shall be
reimbursed  pursuant  to  Section 4 below for costs  and  expenses  incurred  in
connection therewith).

     2.  Employment  Term. This Agreement shall commence on December 7, 2001 and
shall continue in effect through December 31, 2004.

     3. Compensation. (a) For all services rendered by the Executive pursuant to
this  Agreement  the  Company  shall pay to the  Executive  a base salary at the
annual rate of $318,000 for the period from the date of this  Agreement  through
December 31, 2004. All such  compensation  shall be paid semi-monthly or at such
other regular  intervals,  not less frequently than monthly,  as the Company may
establish from time to time for executive employees of the Company.

     (b) In  addition  to the  compensation  set forth in Section 3 hereof,  the
Executive shall be awarded such bonus for each calendar year or partial calendar
year of his  employment  hereunder  as the  Board  shall  determine  in its sole
discretion.  In determining such bonus, the Executive understands that the Board
will consider,  without  limitation,  the following  factors with respect to the
applicable  calendar year or partial  calendar  year:  the  Company's  financial
performance,  business  performance  and growth during such period;  Executive's
responsibilities  (including his  participation  in  transactions  of particular
financial or business  significance to the Company) during such period; and such
other factors as the Board may deem appropriate in their sole  discretion.  Such
bonus may  consist  of cash;  grants of  shares of common  stock of the  Company
("Shares");  options  to  purchase  Shares;  loans  to  purchase  Shares;  share
appreciation  rights  (whether  independent of or in conjunction  with awards of
options);  and such other  awards as the Board in its sole  discretion  may deem
appropriate and which it believes is in furtherance of the growth of stockholder
value of the  Company.  In no event shall such bonus be less than  $325,000  for
each of the years 2001 through 2004,  with each such bonus to be payable in cash
within 30 days after the expiration of each such year.

     4. Expenses.  (a) The Company shall pay for all legal and  accounting  fees
and expenses  incurred by the  Executive  in  connection  with the  structuring,
negotiation and  preparation of this Agreement.  The Company shall reimburse the
Executive for all out-of-pocket  expenses  actually and necessarily  incurred by
him  in  the  conduct  of  the  business  of  the  Company  against   reasonable
substantiation submitted with respect thereto.

     (b) Unless the  provisions  of  subsection  4(c) hereof  shall  apply,  the
Company shall  reimburse  the Executive for all legal fees and related  expenses
(including the costs of experts,  evidence and counsel) paid by the Executive as
a result of (i) the  termination of Executive's  employment  (including all such
fees  and  expenses,  if any,  incurred  in  contesting  or  disputing  any such
termination of employment),  (ii) the Executive seeking to obtain or enforce any
right or benefit

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provided by this Agreement or by any other plan or arrangement maintained by the
Company  under which the  Executive  is or may be entitled to receive  benefits,
including,  without limitation,  the Company's deferred  compensation plan (iii)
the  Executive's  hearing before the Board as  contemplated  in subsection  6(c)
hereof or (iv) any action taken by the Company against the Executive;  provided,
however,  that the Company shall  reimburse the legal fees and related  expenses
described in this subsection 4(b) only if and when a final  judgement,  order or
decree of a court of competent  jurisdiction  has been  rendered in favor of the
Executive  and the time for appeal  therefrom has expired and no appeal has been
perfected.

     (c) The Company  shall pay all legal fees and related  expenses  (including
the costs of experts,  evidence and counsel)  incurred by the  Executive as they
become  due as a  result  of  (i)  the  termination  of  Executive's  employment
(including  all such  fees and  expenses,  if any,  incurred  in  contesting  or
disputing any such  termination of  employment),  (ii) the Executive  seeking to
obtain or enforce  any right or benefit  provided  by this  Agreement  or by any
other plan or arrangement maintained by the Company under which the Executive is
or may be entitled to receive benefits, (iii) the Executive's hearing before the
Board as  contemplated in subsection 6(c) hereof or (iv) any action taken by the
Company against the Executive,  until such time as a final  judgement,  order or
decree of a court of competent  jurisdiction  has been  rendered in favor of the
Company  and the time for appeal  therefrom  has  expired and no appeal has been
perfected; provided, however, that the circumstances set forth above occurred on
or after a change in control of the Company,  as defined in subsection  6(e). In
no event shall the  Executive be required to reimburse the Company for any legal
fees or related expenses paid by the Company pursuant to this subsection 4(c).

     5. Benefits.  The Executive shall be entitled to six weeks of paid vacation
each year and such other medical and other benefits as are afforded from time to
time to all executive employees of the Company.  The Company shall indemnify the
Executive in the performance of his duties pursuant to the bylaws of the Company
and  to the  fullest  extent  allowed  by  applicable  law,  including,  without
limitation,  legal fees, and shall continue to maintain the Executive as a named
beneficiary  under any liability  insurance  policies  maintained  for directors
and/or  officers of the Company for so long as Executive shall remain a director
or officer of the Company. In addition, Executive shall become, and continue as,
a named beneficiary  under any liability  insurance  policies  maintained by the
Company after a change in control of the Company for persons who were  directors
or  officers  prior to a change in  control of the  Company  to the extent  they
provide  coverage for events prior to the change in control of the Company.  The
Company agrees to maintain the coverages referred to above unless, in each case,
any modification in indemnification  and insurance coverage applies uniformly to
all officers and directors of the Company, as the case may be.

     6. Earlier Termination. (a) If the Executive shall fail, because of illness
or  incapacity,  to render the services  contemplated  by this Agreement for six
successive months or for shorter periods aggregating nine months in any calendar
year, the Board may determine,  on the basis of medical evidence satisfactory to
the  Board,  in the  Board's  sole  discretion,  that the  Executive  has become
disabled.  If within thirty (30) days after the date on which written  notice of
such  determination  is given to the  Executive,  the  Executive  shall not have
returned to the full-time

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performance  of his duties  hereunder,  this Agreement and the employment of the
Executive  hereunder  shall be deemed  terminated on such 30th day in accordance
with Section 8 hereof.

     (b) Except as otherwise provided in this Agreement,  if the Executive shall
die during the term of this  Agreement,  this Agreement  shall be deemed to have
been terminated as of the date of death of the Executive.

     (c) The Company,  by notice to the Executive,  may terminate this Agreement
for proper cause. As used herein,  "proper cause" shall mean (i) the willful and
continued failure by the Executive to substantially  perform his duties with the
Company (other than any such failure  resulting from the Executive's  incapacity
due to physical  or mental  illness or any such  actual or  anticipated  failure
resulting from  termination by the Executive for Good Reason (as defined below))
after a written demand for substantial performance is delivered to the Executive
by the Board, which demand specifically identifies the manner in which the Board
believes that the Executive has not substantially  performed his duties, or (ii)
the willful  engaging by the  Executive  in conduct  which is  demonstrably  and
materially  injurious to the Company,  monetarily or otherwise.  For purposes of
this subsection  6(c), no act, or failure to act, on the Executive's  part shall
be deemed  "willful"  unless  done,  or  omitted  to be done,  by the  Executive
otherwise  than in good  faith  and in a manner  that the  Executive  reasonably
believed  was in or not  opposed to the best  interests  of the  Company and its
Stockholders.  Notwithstanding the foregoing,  the Executive shall not be deemed
to have been  terminated for proper cause unless and until there shall have been
delivered  to  the  Executive  a  copy  of a  resolution  duly  adopted  by  the
affirmative vote of not less than  three-quarters of the members of the Board at
a meeting of the Board called and held for such purpose (after reasonable notice
to the Executive and an opportunity for the Executive,  together with counsel of
his choosing,  to be heard before the Board not less than 10 business days after
the giving of such notice), finding that in the good faith opinion of the Board,
the Executive  conducted himself as set forth above in clause (i) or (ii) of the
first sentence of this  subsection  6(c) and specifying the  particulars of such
conduct in detail.  Notwithstanding  anything contained in this Agreement to the
contrary,  no failure to perform by the Executive  after a Notice of Termination
is given by the  Executive  shall  constitute  proper cause for purposes of this
Agreement.

     (d) The Executive may terminate  this Agreement for "Good Reason" if any of
the following events occurs:

          (i)  the  assignment  to  the  Executive  of  any  duties   materially
     inconsistent  with his status as a senior executive  officer of the Company
     or  a   substantial   alteration   in  the   nature   or   status   of  his
     responsibilities;

          (ii) the  Company's  breach of any of its  agreements  or  obligations
     under this Agreement;

          (iii) the failure by the Company to pay the Executive any  installment
     of a previous award under any bonus or incentive compensation arrangement;

<PAGE>

          (iv) the  failure of the  Company to obtain a  satisfactory  agreement
     from any  successor  to assume  and agree to  perform  this  Agreement,  as
     contemplated in Section 13 hereof;

          (v) any purported  termination of the Executive's  employment which is
     not effected pursuant to a Notice of Termination (defined below) satisfying
     the requirements of Section 7 hereof; or

          (vi) any change in control of the  Company,  as defined in  subsection
     6(e).

     (e) For  purposes of this  Agreement,  a "change in control of the Company"
shall be deemed to occur if:

     (i) there shall have occurred a change in control of a nature that would be
required to be reported in response to Item 6(e) of Schedule  14A of  Regulation
14A  promulgated  under the  Securities  Exchange  Act of 1934,  as amended (the
"Exchange Act"), as in effect on the date hereof,  whether or not the Company is
then subject to such reporting requirement,  provided, however, that there shall
not be deemed to be a change in control of the Company if  immediately  prior to
the occurrence of what would otherwise be a change in control of the Company (A)
the  Executive is the other party to the  transaction  (a "Control  Event") that
would  otherwise  result  in a  change  in  control  of the  Company  or (B) the
Executive  is an  executive  officer,  trustee,  director or more than 5% equity
holder of the other  party to the Control  Event or of any  entity,  directly or
indirectly, controlling such other party, or

     (ii) the Company engages in a merger,  consolidation or  reorganization  or
sells all or  substantially  all of the Company's  assets to a "Person" (as such
term is used for purposes of Section 13(d) or 14(d) of the Exchange Act (each, a
"Transaction")),  provided,  however,  that a Transaction shall not be deemed to
result in a change in control of the Company if (A)  immediately  prior  thereto
the circumstances in subsection 6(e)(i)(A) or subsection 6(e)(i)(B) above exist,
or (B) (1) the Stockholders immediately before such Transaction own, directly or
indirectly,  immediately  following  such  Transaction  in  excess of 69% of the
combined voting power of the outstanding voting securities of the corporation or
other entity resulting from such  Transaction  (the "Surviving  Corporation") in
substantially the same proportion as their ownership of the voting securities of
the Company immediately before such Transaction and (2) the individuals who were
members  of the  Board  immediately  prior  to the  execution  of the  agreement
providing for such Transaction  constitute at least a majority of the members of
the  board of  directors  or the board of  trustees,  as the case may be, of the
Surviving  Corporation,  or  of a  corporation  or  other  entity  beneficially,
directly or indirectly,  owning a majority of the outstanding  voting securities
of the Surviving Corporation, or

     (iii) the Company acquires the assets of another company or a subsidiary of
the Company merges,  consolidates or reorganizes  with another company (each, an
"Other  Transaction")  and (A) the  Stockholders  immediately  before such Other
Transaction  own,  directly  or  indirectly,  immediately  following  such Other
Transaction 69% or less of the combined  voting power of the outstanding  voting
securities  of the  corporation  or  other  entity  resulting  from  such  Other
Transaction  (the  "Other  Surviving  Corporation")  in  substantially  the same
proportion as their

<PAGE>

ownership of the voting securities of the Company  immediately before such Other
Transaction  or (B) the  individuals  who were  members of the  Company's  Board
immediately  prior to the  execution of the  agreement  providing for such Other
Transaction  constitute  less than a  majority  of the  members  of the board of
directors or the board of trustees,  as the case may be, of the Other  Surviving
Corporation,  or of a  corporation  or other  entity  beneficially  directly  or
indirectly  owning a majority of the outstanding  voting securities of the Other
Surviving Corporation, provided, however, that an Other Transaction shall not be
deemed to result in a change in control  of the  Company  if  immediately  prior
thereto the  circumstances  in subsection  6(e)(i)(A)  or subsection  6(e)(i)(B)
above exist, or

     (iv)  adoption  by  the  Board  and  approval  by  the  Stockholders  of  a
liquidation or dissolution of the Company;

     (v) any Person or group of affiliated  Persons owns at any time 30% or more
of the outstanding  voting securities of the Company,  provided that such Person
or  group  shall  not be  deemed  to own 30% or more of the  outstanding  voting
securities of the Company if the last event or transaction which results in such
ownership is (a) the issuance of such  securities in connection with the sale by
the  Company  of less  than all or  substantially  all of its  assets or (b) the
acquisition  by the Company of any such voting  securities;  provided,  however,
that if a Person owns 30% or more of the  outstanding  voting  securities of the
Company  as a result  of the  acquisition  by the  Company  of any  such  voting
securities and after such  acquisition  by the Company,  such Person becomes the
owner of any  additional  voting  securities  of the  Company  than a change  in
control of the Company shall occur; or

     (vi) the  rejection  by the  Stockholders  of the entire slate of directors
that the Board proposes at a single election of directors; and

     (vii)  the  rejection  by the  Stockholders  of  one-half  or  more  of the
directors that the Board proposes over any two or more consecutive  elections of
directors.

     (f)  Notwithstanding  anything contained in this Agreement to the contrary,
if the Executive's  employment is terminated prior to a change in control of the
Company and the Executive reasonably demonstrates that such termination: (i) was
at the request of a third party who has  indicated  an  intention or taken steps
reasonably calculated to effect a change in control and who effectuates a change
in control of the Company or (ii) otherwise  occurred in connection  with, or in
anticipation of, a change in control of the Company which actually occurs,  then
for all  purposes  of this  Agreement,  the date of a change in  control  of the
Company with respect to the Executive shall mean the date  immediately  prior to
the date of such termination of the Executive's employment.

     7. Notice of  Termination.  Any purported  termination  of the  Executive's
employment by the Company or by the Executive shall be communicated by a written
Notice of  Termination  to the other party hereto in accordance  with Section 15
hereof.  For purposes of this Agreement,  a "Notice of Termination" shall mean a
notice which shall indicate the specific termination provision in this Agreement
relied upon and shall set forth in reasonable detail the facts

<PAGE>

and circumstances  claimed to provide a basis for termination of the Executive's
employment under the provision so indicated.

     8. Date of Termination,  Etc. "Date of  Termination"  shall mean (a) if the
Executive's  employment is  terminated  for  disability,  thirty (30) days after
Notice of  Termination  is given  (provided  that the  Executive  shall not have
returned to the full-time  performance of his duties during such thirty (30) day
period),  and  (b) if the  Executive's  employment  is  terminated  pursuant  to
subsection 6(c) or 6(d) hereof or for any other reason (other than  disability),
the  date  specified  in the  Notice  of  Termination  (which,  in the case of a
termination  pursuant to  subsection  6(c) hereof  shall not be less than thirty
(30) days, and in the case of a termination  pursuant to subsection  6(d) hereof
shall not be less than thirty (30) nor more than sixty (60) days,  respectively,
from the date such Notice of Termination is given); provided, however, if within
thirty (30) days after any Notice of  Termination  is given the party  receiving
such  Notice of  Termination  notifies  the other  party  that a dispute  exists
concerning the termination,  the Date of Termination  shall be the date on which
the  dispute is finally  resolved,  either by mutual  written  agreement  of the
parties, by a binding arbitration award, or by a final judgment, order or decree
of a court of competent  jurisdiction  (which is not  appealable or the time for
appeal  therefrom  having expired and no appeal having been  perfected),  except
that with respect to a termination  of this Agreement by reason of expiration of
its term as provided in Section 2 hereof,  the Date of Termination  shall be the
date the term hereof expires pursuant to Section 2 hereof, regardless of whether
a dispute  exists with  respect  thereto;  provided,  further,  that the Date of
Termination  shall be  extended  by a notice of dispute  only if such  notice is
given in good faith and the party giving such notice  pursues the  resolution of
such dispute with reasonable diligence. Notwithstanding the pendency of any such
dispute, the Company will continue to pay the Executive his full compensation in
effect when the notice giving rise to the dispute was given (including,  but not
limited  to,  base  salary  and  installments   under  any  bonus  or  incentive
compensation   plan)  and  continue  the  Executive  as  a  participant  in  all
compensation, benefit and insurance plans in which he was participating when the
notice  giving  rise to the  dispute  was  given,  until the  dispute is finally
resolved in  accordance  with this  Section 8. Amounts paid under this Section 8
are in addition to all other  amounts due under this  Agreement and shall not be
offset  against or reduce any other amounts due under this  Agreement.  If it is
finally determined by a binding arbitration award, or by a final judgment, order
or decree of a court of competent  jurisdiction  (which is not appealable or the
time for appeal  therefrom  having expired and no appeal having been perfected),
that the Executive was terminated for proper cause, the Executive shall promptly
remit to the  Company  the  amount  of any cash  payments  and the  value of any
non-cash  benefits paid pursuant to this Section 8 to which the Executive  would
not otherwise have been entitled.

     9. Compensation Upon Termination or During Disability.  Upon termination of
the Executive's  employment or during a period of disability the Executive shall
be entitled to the following compensation and benefits:

     (a) During  any  period  that the  Executive  fails to  perform  his duties
hereunder  as a result of  incapacity  due to  physical or mental  illness,  the
Executive shall continue to receive his base salary at the annual rate in effect
at the  commencement  of any such  period  until his  employment  is  terminated
pursuant to subsection 6(a) hereof. The Company shall also pay Executive for the
year in which he is terminated as a result of his disability a prorated  portion
of the annual bonus payable to

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Executive  pursuant to subsection 3(b) hereof for the year in which  Executive's
employment is  terminated,  which shall be an amount equal to the product of the
amount of such annual bonus and a fraction, the numerator of which is the number
of days elapsed in the year in which the Executive's employment terminated prior
to such termination and the denominator of which is 365.

     (b) If the Executive's employment shall be terminated, at any time prior to
a change in control of the  Company,  for proper  cause or by him other than for
Good Reason,  the Executive  shall be paid the  Executive's  base salary payable
pursuant to subsection 3(b) hereof through the Date of Termination.

     (c) If the  Executive's  employment  shall be  terminated  by reason of the
Executive's  death,  the base salary at the annual rate then in effect  shall be
paid to the person designated from time to time in writing by the Executive and,
if not so  designated,  to the  Executive's  estate  for  the  period  up to and
including  the date of  Executive's  death.  The Company  shall also pay to such
person or the estate, as the case may be, a prorated portion of the annual bonus
payable to Executive  pursuant to  subsection  3(b) hereof for the year in which
Executive's  employment  is  terminated,  which shall be an amount  equal to the
product of the amount of such annual  bonus and a  fraction,  the  numerator  of
which  is the  number  of days  elapsed  in the year in  which  the  Executive's
employment  terminated prior to such termination and the denominator of which is
365.

     (d) If the Executive's  employment shall be terminated (i) by reason of his
death or disability, (ii) by the Company other than for proper cause or (iii) by
the  Executive  for Good  Reason,  then the  Executive  shall be entitled to the
benefits provided below:

          (i) The Company shall pay as severance pay to the Executive a lump sum
     severance  payment equal to $1,929,000  which shall be paid to him no later
     than 30 days after the Date of Termination.

          (ii)  Executive  shall have the right to defer receipt of all payments
     to be made pursuant to subdivision  (d)(i) hereof, and to have such amounts
     placed  into  the  trust  under  the   Company's   non-qualified   deferred
     compensation plan.

          (iii) Notwithstanding the foregoing, to the extent any of the payments
     payable  under this Section  9(d) would  constitute  an "excess"  parachute
     payment under Section 280G of the Internal Revenue Code of 1986, as amended
     (the "Code") and by reason of such excess parachute payment Executive would
     be  subject  to an  excise  tax  under  Section  4999(a)  of the  Code  (as
     determined by Executive's tax advisor),  then the payments shall be reduced
     to the largest amount that can be received by Executive  without  incurring
     an  excise  tax  under  Section  4999(a)  of the  Code  (as  determined  by
     Executive's  tax advisor);  provided,  however,  that such reduction  shall
     occur only if the after-tax  value of the benefits to Executive  calculated
     with the foregoing  reduction exceed those calculated without the foregoing
     reduction.  All  amounts  not paid to  Executive  by reason of a  reduction
     hereunder  shall  be paid  by the  Company  directly  to a  public  charity
     qualified under Section  501(c)(3) of the Code, as determined by the Board;

<PAGE>

     provided that such charity's  annual  contributions  for the preceding year
     were in  excess of $1  million  and that  Executive  is not a  director  or
     trustee of such charity.

          (iv) If the  Executive's  employment  is  terminated  for  any  reason
     whatsoever  (other  than by the  Company for proper  cause),  including  by
     reason of  expiration  of its term,  the Company shall assign to Executive,
     without  the  payment of any  consideration  by the  Executive,  all of the
     Company's  right,  title and interest in and to that  certain  Split Dollar
     Life  Insurance   Agreement  dated  November  18,  1993  between  Wellsford
     Residential Property Trust and Jeffrey H. Lynford, as modified by the Split
     Dollar Life  Insurance  Agreement  dated  December 11, 1995 and the related
     insurance  policies  referred to therein,  and in connection  therewith the
     Company shall be deemed to have automatically  waived repayment of any paid
     or accrued premiums with respect to such policy and in connection therewith
     the Company shall be deemed to have  automatically  waived repayment of any
     paid or accrued premiums with respect to such policy.

     (e) If the Executive's  employment is terminated for any reason  whatsoever
(other than by the Company for proper  cause),  all  theretofore  unvested stock
options,  restricted  options,  restricted  stock  and  other  awards  issued to
Executive pursuant to the Company's Incentive Plans shall immediately vest.

     (f) If the  Executive's  employment is  terminated at any time  following a
change in control of the Company,  for proper  cause,  the Company shall pay the
Executive his full base salary  through the Date of Termination at the higher of
the rate in effect at the time  Notice of  Termination  is given and the rate in
effect immediately prior to the change in control of the Company and the Company
shall have no further obligations to the Executive under this Agreement.

     (g) In addition to all other amounts  payable to the  Executive  under this
Section 9, the  Executive  shall be entitled to receive all benefits  payable to
him under the Company's  pension  plans  applicable to him and any other plan or
agreement relating to retirement  benefits including,  without  limitation,  any
deferred  compensation  arrangements  (but subject to any then existing deferral
elections of Executive), as in effect upon the occurrence of a change in control
of the Company or the Executive's  employment with the Company being  terminated
for  any  reason  whatsoever  (other  than by the  Company  for  proper  cause),
including by reason of expiration of its term.

     (h) The  Executive  shall not be  required  to  mitigate  the amount of any
payment provided for in this Section 9 or elsewhere in this Agreement by seeking
other  employment or  otherwise,  nor shall the amount of any payment or benefit
provided for in this Section 9 or elsewhere in this  Agreement be reduced by any
compensation earned by him as the result of employment by another employer or by
retirement  benefits after the Date of  Termination,  or as a result of services
performed by him as permitted under Section 10 hereof,  or otherwise,  except as
specifically provided in this Section 9.

     (i) In the event the Executive's employment hereunder is terminated for any
reason whatsoever  (except by the Company for proper cause),  the Company agrees
to continue, at its

<PAGE>

own cost and expense,  the health,  dental and life insurance benefits available
to Executive at the time his employment is terminated  through December 31, 2004
and to the  extent  he  remains  eligible  (provided  Executive  may at any time
supplement  any cost  necessary to allow for continued  eligibility  as provided
under the terms of the applicable policy),  Executive may continue participation
in the Company's  long-term  disability plan on the same basis as provided prior
to his termination of employment,  at his own cost and expense, through December
31, 2004.

     10.  Issuance  of  Restricted  Shares.  The  Company  agrees to issue  into
Executive's  deferred  compensation  account, on December 31, 2001, an aggregate
number of restricted  common shares equal to the quotient of $1,356,000  divided
by the  average of the high and low prices of the shares of common  stock of the
Company on the American  Stock  Exchange on December 28, 2001.  Such  restricted
shares shall be issued under the Company's  1998  Management  Incentive Plan and
vest as follows:  1/3 shall vest on each of December 31, 2001, June 30, 2002 and
January 1, 2003.

     11.  Performance of Other Services.  From and after such time as the assets
of the Company are  distributed to a Liquidating  Trust,  the Executive shall be
allowed to perform  services  for and engage in business  activities  with other
persons so long as such services and  activities do not prevent  Executive  from
fulfilling his fiduciary responsibilities to the Company.

     12.  Governing Law. THIS  AGREEMENT  SHALL BE GOVERNED BY, AND CONSTRUED IN
ACCORDANCE  WITH, THE INTERNAL LAWS OF THE STATE OF NEW YORK,  WITHOUT REGARD TO
CONFLICTS OF LAW PRINCIPLES.

     13. Entire Agreement. This Agreement sets forth the entire agreement of the
parties  and  is  intended  to  supersede  all  prior  employment  negotiations,
understandings  and agreements.  No provision of this Agreement may be waived or
changed,  except by a writing signed by the party to be charged with such waiver
or change.

     14. Successors;  Binding  Agreement.  (a) This Agreement shall inure to the
benefit  of  and  be   enforceable   by  the   Executive's   personal  or  legal
representatives,  executors,  administrators,  successors,  heirs, distributees,
devisees and legatees.  If the Executive should die while any amount 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 the  Executive's  devisee,  legatee or other  designee or, if
there is no such designee, to the Executive's estate.

     (b) The Company will require any successor (whether direct or indirect,  by
purchase, merger, consolidation or otherwise) to all or substantially all of the
business  and/or assets of the Company to expressly  assume and agree in writing
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.
Failure of the Company to obtain and deliver to Executive  such  assumption  and
agreement prior to (but effective only upon) such  succession  shall be a breach
of this Agreement,  except that for purposes of implementing the foregoing,  the
date on which any such succession  becomes effective shall be deemed the Date of
Termination.  As used in this  Agreement,  "Company"  shall mean the  Company as
hereinbefore  defined  and  any  successor  to its  business  and/or  assets  as

<PAGE>

aforesaid  which  assumes and agrees to perform this  Agreement,  expressly,  by
operation of law, or otherwise.

     15.  Notices.  All  notices  provided  for in this  Agreement  shall  be in
writing,  and shall be deemed to have been duly given when delivered  personally
to the party to receive the same, when given by telex,  telegram or mailgram, or
when mailed first class postage prepaid, by registered or certified mail, return
receipt  requested,  addressed  to the party to  receive  the same at his or its
address above set forth,  or such other address as the party to receive the same
shall have specified by written notice given in the manner  provided for in this
Section  15.  All  notices  shall be deemed to have been given as of the date of
personal delivery, transmittal or mailing thereof.

     16.  Severability.  If any provision in this  Agreement is determined to be
invalid,  it shall not affect the validity or enforceability of any of the other
remaining provisions hereof.

     IN WITNESS  WHEREOF,  the parties hereto have executed this Agreement as of
the date first above written.

                         WELLSFORD REAL PROPERTIES, INC.


                         By:  /s/ Edward Lowenthal
                              --------------------
                         Name: Edward Lowenthal
                         Title: President


                                                  EXECUTIVE:

                                                  /s/ Jeffrey H. Lynford
                                                  ----------------------
                                                  Jeffrey H. Lynford
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