Document:

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                          SEVERENCE BENEFITS AGREEMENT

         AGREEMENT, dated as of October 1, 2000, by and among GLIMCHER REALTY
TRUST, a Maryland real estate investment trust, with offices at 20 South Third
Street, Columbus, Ohio, 43215 ("GRT"), GLIMCHER PROPERTIES LIMITED PARTNERSHIP,
a Delaware limited partnership, with offices at 20 South Third Street, Columbus,
Ohio, 43215 ("GPLP"), and SCOTT T. MCCARTHY, an individual residing at 1934
Dunham, Rochester, MI 48306 (the "Executive")

         WHEREAS, GRT, GPLP and/or their subsidiaries and affiliates, including
entities in which GRT or GPLP own a majority of any non-voting stock
(collectively, the "Company"), have employed, or may employ in the future, the
Executive as an employee of the Company to perform certain services to the
Company upon terms and conditions upon which the Company and the Executive have
previously agreed, or may in the future agree (the "Services");

         WHEREAS, the Company recognizes that the Executive's contributions to
the future growth of the Company will be substantial; and

         WHEREAS, to induce the Executive to remain in the employ of the
Company, the parties hereto desire to set forth certain severance benefits which
GPLP will pay to the Executive in the event of a Change in Control of GRT (as
defined in Section 2 hereof).

         IT IS AGREED:

         1. TERM. This Agreement shall commence on the date hereof and shall
terminated upon the earlier of (a) the date on which GPLP and GRT have satisfied
all of their obligations hereunder, or (b) the date on which the Executive is no
longer an employee of the Company for any reason whatsoever including, without
limitation, termination without cause. Notwithstanding the termination of this
Agreement subsequent to a Change in Control of GRT, in the event that the
Executive is an employee of the Company at the moment immediately prior to a
Change in Control of GRT, the Executive shall be entitled to receive all
benefits described hereunder and the provisions hereof related thereto shall
survive such termination.

         2. CHANGE IN CONTROL OF GRT. For purposes of this Agreement, a "Change
in Control of GRT" 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 GRT is then subject to such reporting
         requirement, provided, however, that there shall not be deemed to a
         Change in Control of GRT if immediately prior to the occurrence of

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         what would otherwise be a Change in Control of GRT (a) the Executive is
         the other party to the transaction (a "Control of GRT Event") that
         would otherwise result in a Change in Control of GRT or (b) the
         Executive is an Executive officer, trustee, director or more than 5%
         equity holder of the other part to the Control of GRT Event or of any
         entity, directly or indirectly, controlling such other party;

                  (ii) GRT merges or consolidates with, or sells all or
         substantially all of its assets to, another company (each, a
         "Transaction"), provided, however, that a Transaction shall not be
         deemed to result in a Change in Control of GRT if (a) immediately prior
         thereto the circumstances in (i)(a) or (i)(b) above exist, or (b) (1)
         the shareholders of GRt, immediately before such transaction own,
         directly or indirectly, immediately following such Transaction in
         excess of fifty percent (50%) 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 GRT immediately before such Transaction and (2) the
         individuals who were members of GRT's Board of Trustees 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) GRT acquires assets of another company or subsidiary of
         GRT merges or consolidates with another company (each an "Other
         Transaction") and (a) the shareholders of GRT, immediately before such
         Other Transaction own, directly of indirectly, immediately following
         such Other Transaction 50% 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 ownership
         of the voting securities of GRT immediately before such Other
         Transaction or (b) the individuals who were members of GRT's Board of
         Trustees 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 board of trustees, as the case may
         be, of the Other Surviving Corporation, or of a corporation or other
         entity beneficially directly or indirectly owing 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 GRT if immediately prior thereto the
         circumstances in (i)(a) or (i)(b) above exist.

         3. COMPENSATION UPON A CHANGE IN CONTROL OF GRT. If the Executive is an
employee of the Company at the moment immediately prior to a Change in Control
of GRT, the Executive shall be entitled to receive the compensation and benefits
set forth below.

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         (a) GPLP shall pay to the Executive, not later than the date of any
Change in Control of GRT, unless otherwise agreed to in writing, a lump sum
severance payment (the "Severance Payment") equal to three (3) times the Base
Amount (as defined below). For purposes of the Section 3(a), the Base Amount
shall mean the Executive's annual compensation during the calendar year period
preceding the calendar year in which the Change in Control of GRT occurs. The
Executive has a three (3) year employment contract ("Contract") with the
Company, covering the period from October 1, 2000 through September 31, 2003.
The terms and conditions of the Contract provide for compensation in the event
of termination of Executive's employment during the term of the Contract. In the
event of a Change in Control of GRT during the term of the Contract, any and all
sums due to the Executive under the Contract shall be credited against any and
all sums due to the Executive under this Agreement. For purposes of determining
annual compensation in this Section 3(a), there shall be included (i) all base
salary and bonuses paid or payable to the Executive by the Company with respect
to the preceding calendar year; (ii) all grants of restricted common shares of
beneficial interest of GRT (the "Shares"), if any, with respect to such
preceding calendar year, which Shares shall be valued based on their date of
grant Fair Market Value (as defined in Section of 7.2 of the GRT's 1993 Employee
Share Option Plan, 1993 Trustee Share Option Plan, or 1997 Incentive Plan, as
the case may be, or any other plan or agreement pursuant to which they are
issued), and (iii) the fair market value of any other property or rights given
or awarded to the Executive by the Company with respect to such preceding
calendar year, or partial first year of employment.

         (b) Any Shares now or hereafter issued to the Executive pursuant to any
restricted Share grant shall vest on the day immediately prior to the date of a
Change in Control of GRT and no longer be subject to repurchase or any other
forfeiture restrictions.

         (c) GRT and GPLP shall cause the Company to maintain in full force and
effect for the Executive's continued benefit for 18 months following a Change in
Control of GRT, all life, accident, medical and dental insurance benefit plans
and programs or arrangements in which the Executive was entitled to participate
immediately prior to the date of a Change in Control of GRT; provided that the
Executive's continued participation is possible under the general terms and
provisions of such plans and programs; and provided, further, that in the event
that the Executive becomes employed by any third party during such 18-month
period, then upon the date of such employment the Executive shall no longer be
entitled to any accident, medical or dental insurance benefits described in the
preceding clause. Subject to the preceding sentence, in the event that the
Executive's participation in any such plan or program is barred, GRT and GPLP
shall arrange to cause the Company to provide the Executive with benefits
substantially similar to those which the Executive was entitled to receive under
such plans and programs. Subject to the first sentence of this paragraph, at the
end of the period of coverage, the Executive shall have the option to have
assigned to him at no cost to the Executive and with no apportionment of prepaid
premiums, any assignable insurance policy owned by the Company and relating
specifically to the Executive.

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         (d) All options to purchase Shares now or hereafter granted to the
Executive shall vest on the day immediately prior to the date of a Change in
Control of GRT and become the fully exercisable in accordance with their terms.

         (e) The Executive shall not be required to mitigate the amount of any
payment provided for in this Section 3 by seeking other employment or otherwise,
nor shall the amount of any payment or benefit provided for in this Section 3 be
reduced by an compensation earned by him as the result of employment by another
employer or by retirement benefits after the date of termination, or otherwise,
except as specifically provided in this Section 3.

         4. ADDITIONAL AMOUNT. Whether or not Section 3 hereof is applicable, if
in the opinion of tax counsel selected by the Executive and reasonable
acceptable to the Company, the Executive has or will receive any compensation or
recognize any income (whether or not pursuant to this Agreement or any plan or
other arrangement of the Company and whether or not the Executive's employment
with the Company has terminated) which constitutes an "excess of parachute
payment" within the meaning of Section 280G(b)(1) of the Internal Revenue Code
of 1986, as amended (the "Code") (or for which a tax is otherwise payable under
Section 4999 of the Code), then GPLP shall pay the Executive an additional
amount (the "Additional Amount") equal to the sum of (i) all taxes payable by
the Executive under Section 4999 of the Code with respect to all such excess
parachute payments (or otherwise), including without limitation the Additional
Amount, plus (ii) all federal, state and local income taxes payable by Executive
with respect to the Additional Amount. The amounts payable pursuant to this
Section 4 shall be paid by GPLP to the Executive not later than the date of any
Change in Control of GRT, unless otherwise agreed to in writing.

         5. EXPENSES. GPLP shall pay or reimburse the Executive, as the case may
be, 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 Executive
seeking to obtain or enforce any right or benefit provided by this Agreement, or
(ii) any action taken by the Company against the Executive in enforcing its
rights hereunder; provided, however, that GPLP shall reimburse the legal fees
and related expenses described in Section 5 only if and when a final judgement
has been rendered in favor of the Executive and all appeals related to any such
action have been exhausted.

         6. NO EMPLOYMENT RIGHTS OR OBLIGATIONS. Nothing contained herein shall
confer upon the Executive the right to continue in the employment or service of
the Company or affect any right that the Company may have to terminate the
employment or service of the Executive at any time for any reason.

         7. GRT GUARANTY. GRT guarantees the satisfaction of all obligations of,
and the full and prompt payment of all amounts payable by GPLP hereunder. In
addition, GRT guarantees the satisfaction of all obligations of the Company
hereunder.

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         8 GOVERNING LAW; ARBITRATION. This Agreement shall be governed by, and
construed in accordance with, the internal laws of the State of Maryland,
without regard to Maryland's conflicts of law principles. Any dispute or
controversy arising under this Agreement, or out of the interpretation hereof,
or based upon the breach hereof, shall be resolved by arbitration held at the
offices of the American Arbitration Association in the City of Philadelphia in
accordance with the rules and regulations of such association prevailing at the
time of the demand for arbitration by either party hereto, provided, however,
that the arbitrator or arbitrators shall only have the power and authority to
interpret, and not modify or amend, the terms and provisions hereof. Judgement
upon an award rendered by the arbitrator or arbitrators may be entered in any
court having jurisdiction thereof. Notwithstanding anything contained in this
Section 8, either party shall have the right to seek preliminary injunctive
relief in any court in the City of Philadelphia in aid of, and pending the final
decision, the arbitration proceeding.

         9. ENTIRE AGREEMENT. This Agreement sets forth the entire agreement of
the parties and is intended to supersede all prior negotiations, understandings
and agreements with respect to the subject matter hereof. 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.

         10. SUCCESSORS; BINDING AGREEMENT. This shall inure to the benefit of,
be binding upon and enforceable by GRT and GPLP, their successors and assigns
and the Executive, and the Executive's personal or legal representatives,
executors, administrators, successors, heirs, distributees, devisees, and
legatees.

         11. 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 shall have
specified by written notice given in the manner provided for in this Section 11.
All notices shall be deemed to have been given as of the date of personal
delivery, transmittal or mailing thereof.

         12. 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.

         13. GRT EXCULPATION. This Agreement and all documents, agreements,
understandings and arrangements relating to the matters described herein have
been executed by the undersigned representative of GRT in his/her capacity as an
officer or trustee of GRT which has been formed as a Maryland real estate
investment trust pursuant to an Amended and Restated Declaration of Trust of
GRT, as amended, and not individually, and neither the trustees, officers or
shareholders of GRT shall be bound or have any personal liability hereunder or
thereunder. The Executive shall look solely to the assets of GRT for
satisfaction of any liability of GRT in respect to this Agreement and all
documents, agreements, understandings and arrangements relating to

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this transaction and will not seek recourse or commence any action against any
of the trustees, officers or shareholders or GRT or any or their personal assets
for the performance or payment of any obligation hereunder or thereunder. The
foregoing shall also apply to any future documents, agreements, understandings,
arrangements and transactions between the parties hereto.

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

                                    GLIMCHER REALTY TRUST

                                    By: /s Michael P. Glimcher
                                        ----------------------------------
                                        Michael P. Glimcher

                                        President

                                    GLIMCHER PROPERTIES LIMITED PARTNERSHIP

                                    By: Glimcher Properties Corporation

                                    Its: General Partner

                                    By: /s Michael P. Glimcher
                                       ----------------------------------
                                       Michael P. Glimcher, President

EXECUTIVE:

/s/ Scott T. McCarthy
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Scott T. McCarthy<PAGE>   1

                       CONSOLIDATED, AMENDED AND RESTATED
                                      NOTE

$127,500,000                                                  New York, New York
                                                                   June 30, 2000

                  WHEREAS, Lender is the present owner and holder of those
certain promissory notes described on Exhibit A attached hereto and incorporated
herein (the "Existing Notes"), which Existing Notes evidence an indebtedness of
owing to Lender in the current outstanding principal amount of $31,500,000;

                  WHEREAS, on the date hereof and pursuant to the terms of this
Note, Lender is making an additional loan advance to Borrower in the principal
amount of $96,000,000 (the "Additional Advance") so that the combined
outstanding principal balance of this Note and the Existing Notes on the date
hereof is $127,500,000;

                  WHEREAS, Borrower and Lender have agreed in the manner
hereinafter set forth to consolidate, amend, modify and restate in their
entirety the terms and provisions of the Existing Notes, on the terms and
conditions hereinafter set forth; and

                  WHEREAS, Borrower intends these Recitals to be a material part
of this Note.

                  NOW THEREFORE, in consideration of the foregoing premises and
for other good and valuable consideration, the receipt and sufficiency of which
are hereby acknowledged, Borrower and Lender agree as follows:

                  I. The Existing Notes and the indebtedness evidenced thereby
are hereby combined and consolidated together and combined and consolidated with
the Additional Advance so that together they shall constitute in law but one
indebtedness in the principal sum of $127,500,000, together with interest
thereon as hereinafter provided. The terms, covenants, conditions and provisions
of the Existing Notes, as so combined and consolidated, are hereby modified,
amended and restated in their entirety

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so that henceforth the terms, covenants, conditions and provisions of the
Existing Notes shall read and be as set forth in this Note and Borrower agrees
to comply with and be subject to all of the terms, covenants and conditions of
this Note.

                  II. The parties hereto certify that this Note evidences the
same indebtedness evidenced by the Existing Notes, as increased by the
Additional Advance, and evidences no further or other indebtedness or obligation
other than the Additional Advance. Neither this Note nor anything contained
herein shall be construed as a novation of Borrower's indebtedness to Lender or
of the Existing Notes, which shall remain in full force and effect as hereby
consolidated, confirmed, modified, restated and superseded.

                  III. This Note is an extension and continuation of the
existing indebtedness evidenced by the Existing Notes, as increased by the
Additional Advance, and is issued in replacement of and substitution for the
Existing Notes.

                  IV. The Existing Notes, as consolidated, modified and restated
in their entirety pursuant to this Note, and the obligations of Borrower
thereunder, as increased by the Additional Advance, are hereby ratified and
confirmed, and shall remain in full force and effect until the full performance
and satisfaction of all obligations of Borrower under this Note.

                  V. For value received, GLIMCHER PROPERTIES LIMITED
PARTNERSHIP, a Delaware limited partnership (the "Borrower") promises to pay to
the order of PRUDENTIAL SECURITIES CREDIT CORP., LLC (the "Lender"), for the
account of Lender, the unpaid principal amount of each Loan made by the Lender
to the Borrower pursuant to the Credit Agreement referred to below on the
Maturity Date of such Loan. The Borrower promises to pay interest on the unpaid
principal amount of each such Loan on the dates and at the rate or rates
provided for in the Credit Agreement. All such payments of principal and
interest shall be made in lawful money of the United States in Federal or other
immediately available funds at the office of Lender under the Credit Agreement
(as defined below).

                  VI. All Loans made by the Lender, the respective types and
maturities thereof and all repayments of the principal thereof shall be recorded
by the Lender and, if the Lender so elects in connection with any transfer or
enforcement hereof, appropriate notations to evidence the foregoing information
with respect to each such Loan then outstanding may be endorsed by the Lender on
the schedule attached hereto, or on a continuation of such schedule attached to
and made a part hereof;

                                       2

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provided that the failure of the Lender to make any such recordation or
endorsement shall not affect the obligations of the Borrower hereunder or under
the Credit Agreement.

                  VII. This Note is one of the Notes referred to in the Credit
Agreement, dated as of June 30, 2000, among the Borrower and Prudential
Securities Credit Corp., LLC, as Lender (as the same may be amended from time to
time, the "Credit Agreement"). Terms defined in the Credit Agreement are used
herein with the same meanings. Reference is made to the Credit Agreement for
provisions for the prepayment hereof and the acceleration of the maturity
hereof.

                             SIGNATURE PAGE FOLLOWS

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                           GLIMCHER PROPERTIES LIMITED PARTNERSHIP,
                           a Delaware limited partnership

                           By:  GLIMCHER PROPERTIES CORPORATION, a
                                Delaware corporation, its sole general partner

                                      By: /s/ George A. Schmidt
                                         --------------------------------------
                                      Name: George A. Schmidt
                                      Title: Executive Vice President, General
                                             Counsel, Secretary and Trustee

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                                    EXHIBIT A

                                 Existing Notes

1. Amended and Restated Promissory Note, dated April 26, 1999, in the original
principal amount of $21,500,000 from Glimcher Properties Limited Partnership, a
Delaware limited partnership and Glimcher Properties Corporation, a Delaware
corporation, in favor of Lehman Brothers Holdings Inc., a Delaware corporation,
d/b/a Lehman Capital, a Division of Lehman Brothers Holdings Inc., as amended.

2. Promissory Note, dated March 1, 2000, in the original principal amount of
$10,000,000, from Glimcher Properties Limited Partnership, a Delaware limited
partnership and Glimcher Properties Corporation, a Delaware corporation, in
favor of Lehman Brothers Holdings Inc., a Delaware corporation, d/b/a Lehman
Capital, a Division of Lehman Brothers Holdings Inc., as amended.

                                  Exhibit A - 1

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