Document:

Exhibit 10.4

    

      EXHIBIT
        10.4

      

      EMPLOYMENT
        AGREEMENT

      

      

      This
        EMPLOYMENT AGREEMENT (“Agreement”)
        is
        made effective as of November 6, 2006 (“Effective
        Date”)
        by and
        between Equity One, Inc, a Maryland corporation (the “Company”),
        and
        Jeffrey S. Stauffer (“Executive”).
        

       

      W
        I T N E S S E T H:

       

      The
        Company desires to employ Executive as of the Effective Date, on the terms
        and
        conditions set forth in this Agreement, and Executive desires to be so
        employed.

       

      IN
        CONSIDERATION
        of the
        premises and the mutual covenants set forth below, the parties hereby agree
        as
        follows:

      

      Section
        1. Employment.
        The
        Company hereby agrees to employ Executive and Executive hereby agrees to
        such
        employment, on the terms and conditions hereinafter set forth.

       

      Section
        2. Term.
        The
        period of employment of Executive by the Company hereunder (the “Employment
        Period”)
        shall
        commence on the Effective Date and shall continue through December 31, 2010.
        This Agreement and the Employment Period automatically shall be renewed for
        successive one-year periods thereafter, unless either party gives the other
        party prior written notice at least six months before the expiration of the
        Employment Period of that party’s intent to allow the Employment Period and this
        Agreement to expire.

       

      Section
        3. Position
        and Duties.
        From
        and after the Effective Date during the Employment Period, Executive shall
        serve
        as Executive Vice President and Chief Operating Officer of the Company and
        shall
        report to the Chief Executive Officer. Executive shall have those powers
        and
        duties normally associated with the position of a Executive Vice President
        and
        Chief Operating Officer and such other powers and duties as the Chief Executive
        Officer may properly prescribe, provided that such other powers and duties
        are
        consistent with Executive’s position as Executive Vice President and Chief
        Operating Officer. Executive shall devote his full business time, attention
        and
        energies to Company affairs as are necessary to fully perform his duties
        for the
        Company (other than absences due to illness or vacation). 

       

      Section
        4. Place
        of Performance.
        The
        principal place of employment of Executive shall be at the Company’s corporate
        offices in North Miami Beach, Florida, and the Executive shall perform his
        duties, as required by Section 3, at the corporate offices in North Miami
        Beach,
        Florida, with such reasonable business-related travel as is necessary to
        perform
        those duties.

       

      Section
        5. Compensation
        and Related Matters.

       

      (a)  Salary.
        During
        the Employment Period, the Company shall pay Executive an annual base salary
        of
        not less than $350,000 (“Base
        Salary”).
        Executive’s Base Salary shall be paid in approximately equal installments in
        accordance with the Company’s customary payroll practices. If the Company
        increases Executive’s Base Salary, such increased Base Salary shall then
        constitute the Base Salary for all purposes of this Agreement. The Company
        may
        not decrease Executive’s Base Salary during the Employment Period.

       

      (b)  Annual
        Bonus.
        The
        compensation committee (the “Compensation
        Committee”)
        of the
        Board of Directors of the Company (the “Board”)
        shall
        review with the Chief Executive Officer the Executive’s performance at least
        annually during each calendar year of the Employment Period and cause the
        Company to award Executive such cash bonus (“Bonus”)
        as the
        Compensation Committee shall reasonably determine as fairly compensating
        and
        rewarding Executive for services rendered to the Company and/or as an incentive
        for continued service to the Company. The amount of Executive’s Bonus shall be
        determined in the discretion of the Compensation Committee in consultation
        with
        the Chief Executive Officer and shall depend on, among other things, the
        Company’s achievement of certain performance levels established by the
        Compensation Committee, which may include, among others, such performance
        measures as growth of earnings, funds from operations per share of Company
        common stock, earnings per share of Company common stock and Executive’s
        performance and contribution to increasing the funds from operations; provided,
        however, that in no event shall the amount of Executive’s Bonus be less than
        half of the then Base Salary for each year of this Agreement ($26,849 for
        the
        year containing the Effective Date). The Company shall pay any Bonus to
        Executive on or before March 15th
        of the
        calendar year following the calendar year to which the bonus
        relates. 

       

      (c)  Restricted
        Stock and Stock Options.
        

       

      (i)  On
        the
        Effective Date, the Company shall grant to Executive, either under the equity
        compensation plans of the Company or otherwise, 40,000 shares of the Company’s
        restricted stock. Such shares of restricted stock shall vest in equal
        installments on each of December 31, 2007, December 31, 2008, December 31,
        2009
        and December 31, 2010. Dividends on restricted stock shall be paid to Executive
        at such times as dividends are paid to shareholders of the Company’s common
        stock. 

       

      (ii)  On
        the
        Effective Date, the Company shall grant to Executive, either under the equity
        compensation plans of the Company or otherwise options to purchase 400,000
        shares of the Company’s common stock. Such stock options shall vest in equal
        installments on each of December 31, 2007, December 31, 2008, December 31,
        2009
        and December 31, 2010. 

       

      (iii)  During
        each year of the Employment Period after the first year of the Employment
        Period, the Compensation Committee shall review with the Chief Executive
        Officer
        the Executive’s performance at least annually and may, in its sole discretion,
        cause the Company to grant to Executive stock options and/or shares of
        restricted stock (in addition to those granted in clauses (i) and (ii) above)
        in
        an amount, if any, the Compensation Committee shall reasonably determine
        as
        fairly compensating and rewarding Executive for services rendered to the
        Company
        and/or as an incentive for continued service to the Company. Stock options
        or
        shares of restricted stock so granted or issued, if any, shall vest in equal
        installments on each of the first, second, third and fourth anniversaries
        of the
        date of grant thereof, provided however that in the event the Company issues
        Executive a notice of non-renewal, all unvested restricted stock and options
        shall vest as of the last day of the Employment Period. 

       

      (iv)  Any
        stock
        options granted to the Executive in accordance with this Agreement shall
        have an
        exercise price equal to the average closing price of a share of the Company’s
        common stock on the principal stock exchange on which the Company’s common stock
        is listed and traded during the ten (10) trading days immediately preceding
        the
        date of grant thereof. In addition, Executive shall have the right to exercise
        all vested options within the six (6) month period immediately following
        Executive’s termination of employment, provided, however, that in the event
        Executive voluntarily terminates Executive’s employment (for other than Good
        Reason), or the Company terminates Executive’s employment for Cause, Executive
        shall only have ninety (90) days following termination of employment to exercise
        Executive’s options. The grant of options and/or restricted stock to Executive
        shall be evidenced by a separate written agreement(s) to be provided to
        Executive. In the event of any conflict between the terms of such stock option
        or restricted stock agreement or the plan relating thereto and the terms
        of this
        Agreement, the terms of this Agreement shall control. 

       

      (v)  If
        any
        shares or options provided for above are not issued under the equity
        compensation plans of the Company, the Company hereby agrees to use commercially
        reasonable efforts to prepare and file with the Securities and Exchange
        Commission a registration statement and such other documents as may be necessary
        in order to comply with the provisions of the Securities Act of 1933, as
        amended, so as to permit the registered resale of the shares of restricted
        stock
        granted hereunder and to permit the registered issuance of any shares of
        common
        stock pursuant to the stock options granted hereunder to the extent not covered
        by an existing, effective registration statement of the Company.

       

      (d)  Long
        Term Cash Incentive Compensation.
        Executive shall be entitled to the long-term cash incentive compensation,
        if
        any, determined in accordance with Exhibit
        A
        attached
        hereto.

       

      (e)  Expenses.
        The
        Company shall reimburse Executive for all reasonable expenses incurred by
        him in
        the discharge of his duties hereunder, including travel expenses, upon the
        presentation of reasonably itemized statements of such expenses in accordance
        with the Company’s policies and procedures now in force or as such policies and
        procedures may be modified with respect to all senior executive officers
        of the
        Company.

       

      (f)  Vacation;
        Illness.
        Executive shall be entitled to the number of weeks of vacation per year provided
        to the Company’s senior executive officers, but in no event less than three (3)
        weeks annually. Executive shall be entitled to take up to 30 days of sick
        leave
        per year; provided, however, that any prolonged illness resulting in absenteeism
        greater than the sick leave permitted herein or disability shall not constitute
        “Cause” for termination under the terms of this Agreement.

       

      (g)  Welfare,
        Pension and Incentive Benefit Plans.
        During
        the Employment Period, Executive (and his wife and dependents to the extent
        provided therein) shall be entitled to participate in and be covered under
        all
        the welfare benefit plans or programs maintained by the Company from time
        to
        time on terms no less favorable than provided for any of its senior executives
        including, without limitation, all medical, hospitalization, dental, disability,
        accidental death and dismemberment and travel accident insurance plans and
        programs. In addition, during the Employment Period, Executive shall be eligible
        to participate in and be covered under all pension, retirement, savings and
        other employee benefit, perquisite, change in control and executive compensation
        plans and any annual incentive or long-term performance plans and programs
        maintained from time to time by the Company on terms no less favorable than
        provided for any of its senior executives.

       

      (h)  Automobile.
        During
        the Employment Term, the Company shall provide Executive with an automobile
        allowance equal to $800 per month.

       

      (i)  Relocation.
        Executive shall relocate his primary residence to Miami-Dade, Broward or
        Palm
        Beach County, Florida, prior to March 31, 2007. The Company shall reimburse
        Executive for reasonable moving costs and expenses associated with such
        relocation of his immediate family and his relocation to Miami-Dade, Broward
        or
        Palm Beach County, in each case, upon the presentation of reasonably itemized
        statements of such costs and expenses in accordance with the Company’s policies
        and procedures now in force or as such policies and procedures may be modified
        with respect to all senior executive officers of the Company. In no event
        shall
        the aggregate amount of any such reimbursement exceed $40,000. 

       

      Section
        6. Termination.
        Executive’s employment hereunder may be terminated during the Employment Period
        under the following circumstances:

       

      (a)  Death.
        Executive’s employment hereunder shall terminate upon his death.

       

      (b)  Disability.
        If, as
        a result of Executive’s incapacity due to physical or mental illness, Executive
        shall have been substantially unable to perform his duties hereunder for
        an
        entire period in excess of one hundred twenty (120) days in any 12-month
        period
despite
        any reasonable accommodation available from the Company, the Company shall
        have
        the right to terminate Executive’s employment hereunder for “Disability”, and
        such termination in and of itself shall not be, nor shall it be deemed to
        be, a
        breach of this Agreement.

       

      (c)  Without
        Cause.
        The
        Company shall have the right to terminate Executive’s employment for any reason
        or for no reason, which termination shall be deemed to be without Cause,
        and
        such termination in and of itself shall not be, nor shall it be deemed to
        be, a
        breach of this Agreement.

       

      (d)  Cause.
        The
        Company shall have the right to terminate Executive’s employment for Cause, and
        such termination in and of itself shall not be, nor shall it be deemed to
        be, a
        breach of this Agreement. For purposes of this Agreement, the Company shall
        have
“Cause” to terminate Executive’s employment upon Executive’s:

       

      (i) Breach
        of
        any material provisions of this Agreement, including, without limitation,
        the
        failure of the Executive to perform the duties in the manner required by
        Section
        3 and 4 hereunder;

       

      (ii)  Conviction
        of a felony, capital crime or any crime involving moral turpitude, including
        but
        not limited to crimes involving illegal drugs; or

       

      (iii)  Willful
        misconduct that is materially economically injurious to the Company or to
        any
        Company Affiliate.

       

      For
        purposes of this Section 6(d), no act, or failure to act, by Executive shall
        be
        considered “willful” unless committed in bad faith and without a reasonable
        belief that the act or omission was in the best interests of the Company
        or
        Company Affiliate; provided, however, that the willful requirement outlined
        in
        paragraph (iii) above shall be deemed to have occurred if Executive’s action or
        non-action continues for more than ten (10) days after Executive has received
        written notice of the inappropriate action or non-action. Failure to achieve
        performance goals, in and of itself, shall not be grounds for a termination
        for
        Cause. For purposes of this Agreement, “Company Affiliate” means any entity in
        control of, controlled by or under common control with the Company or in
        which
        the Company owns any common or preferred stock or interest or any entity
        in
        control of, controlled by or under common control with such entity
        thereof.

       

      Cause
        shall not exist under paragraph (i) or (iii) above unless and until the Company
        has delivered to Executive written notice of its determination that Executive
        was guilty of the conduct set forth in paragraph (i) or (iii) and specifying
        the
        particulars thereof in detail. However, in the case of conduct described
        in
        paragraph (i), Cause will not be considered to exist unless Executive is
        given
        30 days from the date of such notice to cure such breach, or if the breach
        cannot be reasonably cured within such 30 day period, to commence to cure
        such
        breach, to the satisfaction of the Company, within such 30 day period. If
        Executive has not cured such breach to the satisfaction of the Company within
        90
        days after the date of such notice, the Company shall give a Notice of
        Termination to Executive. In the event a final determination is made by a
        court
        of competent jurisdiction that the Company’s termination of Executive under this
        Section 6(d) does not meet the definition of Cause, Executive will be deemed
        to
        have been terminated by the Company without Cause.

       

      (e)  Following
        Change in Control.
        Within
        twelve (12) months after a Change in Control occurs, Executive may resign
        his
        employment or his employment may be terminated for any reason, including,
        without limitation, death or Disability. For purposes of this Agreement,
        such a
        termination of employment (including, without limitation, as a result of
        such a
        resignation) is referred to as “Termination Following Change in Control.” For
        this purpose, a “Change in Control” means:

       

      (i)  Consummation
        by the Company of (A) a reorganization, merger, consolidation or other form
        of
        corporate transaction or series of transactions, in each case, other than
        a
        reorganization, merger or consolidation or other transaction that would result
        in the holders of the voting securities of the Company outstanding immediately
        prior thereto holding securities that represent immediately after such
        transaction more than 50% of the combined voting power of the voting securities
        of the Company or the surviving company or the parent of the surviving company,
        or (B) a liquidation or dissolution of the Company or (C) the sale of all
        or
        substantially all of the assets of the Company; 

       

      (ii)  Individuals
        who, as of the Effective Date, constitute the Board (the “Incumbent
        Board”)
        cease
        for any reason to constitute at least a majority of the Board, provided (A)
        that
        any person becoming a director subsequent to the Effective Date whose election,
        or nomination for election by the Company’s stockholders, was approved by a vote
        of at least a majority of the directors then comprising the Incumbent Board
        (other than an election or nomination of an individual whose initial assumption
        of office is in connection with an actual or threatened election contest
        relating to the election of the Directors of the Company, as such terms are
        used
        in Rule 14a-11 of Regulation 14A promulgated under the Securities Exchange
        Act
        of 1934) or (B) any individual appointed to the Board by the Incumbent Board
        shall be, for purposes of this Agreement, considered as though such person
        were
        a member of the Incumbent Board; or

       

      (iii)  The
        acquisition (other than from the Company) by any person, entity or “group,”
within the meaning of Section 13(d)(3) or 14(d)(2) of the Securities Exchange
        Act of 1934, of more than 26% of either the then outstanding shares of the
        Company’s common stock or the combined voting power of the Company’s then
        outstanding voting securities entitled to vote generally in the election
        of
        directors (hereinafter referred to as the ownership of a “Controlling
        Interest”)
        excluding, for this purpose, any acquisitions by (A) the Company or its
        subsidiaries, or (B) any person, entity or “group” that as of the Effective Date
        beneficially owns (within the meaning of Rule 13d-3 promulgated under the
        Securities Exchange Act of 1934) a Controlling Interest of the Company or
        any
        affiliate of such person, entity or “group.”

       

      Executive
        acknowledges and agrees that, notwithstanding anything in this Agreement
        to the
        contrary, a Change in Control shall not be deemed to have occurred for purposes
        of this Agreement if, after the consummation of any of the events described
        in
        the definition of a Change in Control, Chaim Katzman remains Chairman of
        the
        Board of the Successor Employer (as hereinafter defined) and if Gazit, Inc.
        and
        its affiliates own in the aggregate 33% or more of the outstanding voting
        securities of the Successor Employer. For purposes of this Agreement, the
        term
“Successor Employer” shall mean the Company, the reorganized, merged or
        consolidated Company (or the successor thereto), or the acquiror (through
        merger
        or otherwise) of all or substantially all of the assets of the Company, as
        the
        case may be. If an event described in Section 6(e)(i), (e)(ii), or (e)(iii)
        above occurs, but the event does not constitute a Change in Control pursuant
        to
        the provisions of this paragraph, the Performance Period (as defined in Exhibit
        A which is attached hereto and made part hereof) shall be deemed to end on
        the
        business day immediately preceding the applicable event.

       

      (f)  Resignation
        Other Than Termination Following Change in Control.
        Executive shall have the right to resign his employment by providing the
        Company
        with a Notice of Termination, as provided in Section 7. If such resignation
        occurs other than within twelve (12) months after a Change in Control occurs,
        Executive’s resulting termination of employment shall be considered as other
        than Termination Following Change in Control. Any termination pursuant to
        this
        paragraph shall not in and of itself be, nor shall it be deemed to be, a
        breach
        of this Agreement.

       

      (g)  Resignation
        For Good Reason.
        Executive
        shall have the right to resign his employment for Good Reason. For purposes
        of
        this Agreement, Executive shall have Good Reason to terminate Executive’
employment upon:

       

      (i) the
        material breach by the Company of any of its agreements set forth herein
        and the
        failure of the Company to correct such breach within thirty (30) days after
        the
        receipt by the Company of written notice from Executive specifying in reasonable
        detail the nature of such breach; or

       

      (ii) any
        substantial or material diminution of Executive’s responsibilities including
        without limitation reporting responsibilities and/or title.

       

      Section
        7. Termination
        Procedure.

       

      (a)  Notice
        of Termination.
        Any
        termination of Executive’s employment by the Company or by Executive (whether by
        resignation or otherwise) during the Employment Period, except termination
        due
        to Executive’s death pursuant to Section 6(a), shall be communicated by written
        Notice of Termination to the other party hereto in accordance with Section
        15.
        For purposes of this Agreement, a “Notice of Termination” shall mean a notice
        that states the specific termination provision in this Agreement relied upon
        and
        shall set forth in reasonable detail the facts and circumstances claimed
        to
        provide a basis for termination of Executive’s employment under the provision so
        stated.

       

      (b)  Date
        of Termination.
        The
        effective date of any termination of Executive’s employment by the Company or by
        Executive (whether by resignation or otherwise) (the “Date
        of Termination”)
        shall
        be (i) if Executive’s employment is terminated by his death, the date of his
        death, and (ii) if Executive’s employment is terminated for any other reason by
        the Company or by Executive (whether by resignation or otherwise), the date
        on
        which a Notice of Termination is given or any later date (within thirty (30)
        days after the giving of such notice) set forth in such Notice of
        Termination.

       

      Section
        8. Compensation
        Upon Termination or During Disability.
        If
        Executive experiences a Disability or his employment terminates during the
        Employment Period, the Company shall provide Executive with the payments
        and
        benefits set forth below; provided, however, as a specific condition to being
        entitled to any payments or benefits under this Section 8, Executive must
        have
        resigned as a director, trustee and officer of the Company and all of its
        subsidiaries and as a member of any committee of the board of directors of
        the
        Company and its subsidiaries of which he is a member and must have joined
        the
        Company in having executed a mutual release of both the Company and its
        Affiliates as well as Executive, in the form attached hereto as Exhibit
        B.
        Executive acknowledges and agrees that the payments set forth in this Section
        8
        constitute liquidated damages for termination of his employment during the
        Employment Period, which the parties hereto have agreed to as being reasonable,
        and Executive acknowledges and agrees that he shall have no other remedies
        in
        connection with or as a result of any such termination.

       

      (a)  Disability;
        Death.
        During
        any period that Executive fails to perform his duties hereunder as a result
        of
        Disability, Executive shall continue to receive his full Base Salary set
        forth
        in Section 5(a) and his full Bonus as set forth in Section 5(b) until his
        employment is terminated pursuant to Section 6(b). In addition, if Executive’s
        employment is terminated for Disability pursuant to Section 6(b), or due
        to
        Executive’s death pursuant to Section 6(a), in each case other than a
        Termination Following Change in Control:

       

      (i)  the
        Company shall pay to Executive or his estate, as the case may be, a lump
        sum
        payment as soon as practicable following the Date of Termination equal to
        (A)
        his Base Salary, Accrued Bonus (as defined in Section 8(d) below) and accrued
        vacation pay through the Date of Termination, plus
        (B) one
        of the following two amounts, as applicable, (1) if there is one year or
        more
        remaining in the Employment Period, the sum of Executive’s then current Base
        Salary for one year plus his Average Bonus (as defined in Section 8(d) below),
        or (2) if there is less than one year remaining in the Employment Period,
        the
        amount of Base Salary (as provided for in Section 5(a)) Employee would have
        received through the end of the Employment Period plus his Average Bonus
        pro
        rated for the portion of the fiscal year following the date of termination
        through the end of the Employment Period and plus
        (C) the
        amount not yet paid to Executive under Section 5(d);

       

      (ii)  stock
        options and restricted stock granted to Executive prior to the Date of
        Termination that were to vest based on the passage of time shall fully vest
        as
        of the Date of Termination;

       

      (iii)  the
        Company shall reimburse Executive, or his estate, as the case may be, pursuant
        to Section 5(e) for reasonable expenses incurred, but not paid prior to such
        termination of employment; and

       

      (iv)  Executive
        or his estate or named beneficiaries shall be entitled to any other rights,
        compensation and/or benefits as may be due to Executive or his estate or
        named
        beneficiaries in accordance with the terms and provisions of any agreements,
        plans or programs of the Company.

       

      (b)  Termination
        By Company Without Cause, Termination by Executive for Good Reason or
        Termination Following Change in Control.
        If (x)
        Executive’s employment is terminated by the Company without Cause, (y) Executive
        terminates his employment with the Company for Good Reason, or (z) Executive
        resigns and such resignation is a Termination Following a Change of Control
        or
        is terminated by reason of death or Disability and such termination is a
        Termination Following Change in Control:

       

      (i) the
        Company shall pay to Executive his Base Salary, Accrued Bonus and accrued
        vacation pay through the Date of Termination, as soon as practicable following
        the Date of Termination; 

       

      (ii) in
        the
        case of (x) or (y) above, the Company shall pay to Executive as soon as
        practicable following the Date of Termination a lump-sum payment equal to
        two
        (2) times the sum of Executive’s then current Base Salary plus his Average
        Bonus;

       

      (iii) in
        the
        case of (z) above, the Company shall pay to Executive as soon as practicable
        following the Date of Termination a lump-sum payment equal to three (3) times
        the sum of Executive’s then current Base Salary plus his Average
        Bonus;

       

      (iv) the
        Company shall pay to Executive as soon as practicable following the Date
        of
        Termination a lump-sum payment equal to the amount not yet paid to Executive
        under Section 5(d);

       

      (v) in
        the
        case of (x) or (y) above, stock options and restricted stock granted to
        Executive prior to the Date of Termination that were to vest based on the
        passage of time shall fully vest as of the Date of Termination;

       

      (vi) in
        the
        case of (z) above, (A) stock options and restricted stock granted to Executive
        prior to the Date of Termination that were to vest based on the passage of
        time
        shall fully vest as of the Date of Termination; and (B) if Executive’s Date of
        Termination precedes the otherwise applicable end-date for a performance
        period
        for stock options or restricted stock granted to Executive pursuant to Section
        5(c), or granted to Executive under any equity-based award program sponsored
        by
        the Company, a percentage of such stock options or restricted stock shall
        vest
        as of the Date of Termination equal to the period of time that has elapsed
        since
        the date of award of such stock options or restricted stock compared to the
        total time during the performance period stated in the award of such stock
        options or restricted stock; 

       

      (vii) the
        Company shall reimburse Executive pursuant to Section 5(e) for reasonable
        expenses incurred, but not paid prior to such termination of employment;
        and

       

      (viii) Executive
        shall be entitled to any other rights, compensation and/or benefits as may
        be
        due to Executive in accordance with the terms and provisions of any agreements,
        plans or programs of the Company.

       

      (c)  Termination
        by the Company for Cause or Resignation By Executive Other Than Termination
        For
        Good Reason and other than Termination Following Change in
        Control.
        If
        Executive’s employment is terminated by the Company for Cause, or if Executive’s
        resignation is other than for Good Reason or other than a Termination Following
        Change in Control:

       

      (i) the
        Company shall pay Executive his Base Salary and, to the extent required by
        law
        or the Company’s vacation policy, his accrued vacation pay through the Date of
        Termination, as soon as practicable following the Date of
        Termination;

       

      (ii) the
        Company shall reimburse Executive pursuant to Section 5(e) for reasonable
        expenses incurred, but not paid prior to such termination of employment,
        unless
        such termination resulted from a misappropriation of Company funds;

       

      (iii) Executive
        shall be entitled to any other rights, compensation and/or benefits as may
        be
        due to Executive in accordance with the terms and provisions of any agreements,
        plans or programs of the Company; and

       

      (iv) All
        unvested stock options and unvested restricted stock granted to Executive
        shall
        be forfeited.

       

      (d)  Bonus.
        If
        Executive’s termination of employment occurs after the end of any fiscal year of
        the Company for which a Bonus would be payable to Executive pursuant to Section
        5(b) above and Executive’s termination is not for Cause and Executive’s
        termination occurs prior to the date bonuses for senior executives are paid
        for
        the fiscal year (including, without limitation, the Bonus), Executive (or
        his
        estate, as the case may be) shall be entitled to payment of any Bonus that
        is
        earned for such fiscal year without regard to whether Executive’s termination of
        employment precedes the Bonus payment date. If Executive’s termination of
        employment occurs prior to the end of any fiscal year of the Company for
        which a
        Bonus would be payable to Executive pursuant to Section 5(b) above and
        Executive’s termination is not for Cause or a voluntary termination by Executive
        (other than for Good Reason or a Termination Following a Change of Control),
        Executive (or his estate, as the case may be) shall be entitled to payment
        of a
        pro rated portion of the Bonus calculated as follows: Executive’s Average Bonus
        shall be multiplied by a fraction the numerator of which shall be the number
        of
        days in the fiscal year that elapsed prior to Executive’s termination of
        employment and the denominator of which shall be 365. The amount Executive
        is
        entitled to under either of the two preceding sentences shall be referred
        to in
        this Agreement as the “Accrued
        Bonus”.
        For
        purposes of this Agreement, the “Average
        Bonus”
shall
        mean the average annual Bonus (not including any Bonus payable for the calendar
        year including the Effective Date), if any, for the three (3) most recently
        completed fiscal years. In addition, if Executive’s termination occurs before
        Executive has worked and been eligible to receive a Bonus for three fiscal
        years, any references in this Section 8 to Executive’s Average Bonus will be
        interpreted to mean such lesser number of fiscal years during which Executive
        was employed before termination and eligible to receive a Bonus. If Executive’s
        employment is terminated during the first fiscal year following the year
        including the Effective Date, then the Average Bonus shall be deemed to mean
        the
        an amount equal to 100% percent of the then Base Salary.

       

      (e)  Tax
        Payment by the Company.

       

      (i) If
        any
        amount or benefit paid or distributed to Executive pursuant to this Agreement,
        taken together with any amounts or benefits otherwise paid or distributed
        to
        Executive by the Company or any affiliated company (collectively, the
“Covered
        Payments”),
        are
        or become subject to the tax (the “Excise
        Tax”)
        imposed
        under Section 4999 of the Code, or any similar tax that may hereafter be
        imposed, the Company shall pay to Executive at the time specified below an
        additional amount (the “Tax
        Reimbursement Payment”)
        such
        that the net amount retained by Executive with respect to such Covered Payments,
        after deduction of any Excise Tax on the Covered Payments and any Federal,
        state
        and local income or employment tax and Excise Tax on the Tax Reimbursement
        Payment provided for by this Section 8(e), but before deduction for any Federal,
        state or local income or employment tax withholding on such Covered Payments,
        shall be equal to the amount of the Covered Payments.

       

      (ii) For
        purposes of determining whether any of the Covered Payments will be subject
        to
        the Excise Tax and the amount of such Excise Tax: (A) such Covered Payments
        will
        be treated as “parachute payments” within the meaning of Section 280G of the
        Code, and all “parachute payments” in excess of the “base amount” (as defined
        under Section 280G(b)(3) of the Code) shall be treated as subject to the
        Excise
        Tax, unless, and except to the extent that, in the good faith judgment of
        the
        Company’s independent certified public accountants appointed prior to the date
        of the Change in Control or tax counsel selected by such accountants (the
        “Accountants”),
        the
        Company has a reasonable basis to conclude that such Covered Payments (in
        whole
        or in part) either do not constitute “parachute payments” or represent
        reasonable compensation for personal services actually rendered (within the
        meaning of Section 280G(b)(4)(B) of the Code) in excess of the allocable
“base
        amount,” or such “parachute payments” are otherwise not subject to such Excise
        Tax, and (B) the value of any non-cash benefits or any deferred payment or
        benefit shall be determined by the Accountants in accordance with the principles
        of Section 280G of the Code.

       

      (iii) For
        purposes of determining the amount of the Tax Reimbursement Payment, Executive
        shall be deemed to pay: (A) Federal income, social security, Medicare and
        other
        employment taxes at the highest applicable marginal rate of Federal income
        taxation for the calendar year in which the Tax Reimbursement Payment is
        to be
        made, and (B) any applicable state and local income or other employment taxes
        at
        the highest applicable marginal rate of taxation for the calendar year in
        which
        the Tax Reimbursement Payment is to be made, net of the maximum reduction
        in
        Federal income taxes that could be obtained by Executive from the deduction
        of
        such state or local taxes if paid in such year.

       

      (iv) The
        Tax
        Reimbursement Payment (or portion thereof) provided for above shall be paid
        to
        Executive not later than 10 business days following the payment of the Covered
        Payments.

       

      (v) If
        the
        Excise Tax is subsequently determined by the Accountants or pursuant to any
        proceeding or negotiations with the Internal Revenue Service to be less than
        the
        amount taken into account hereunder in calculating the Tax Reimbursement
        Payment
        made, Executive shall repay to the Company, at the time of such determination,
        the portion of the prior Tax Reimbursement Payment that would not have been
        paid
        if the reduced Excise Tax had been taken into account in initially calculating
        the Tax Reimbursement Payment, plus interest on the amount of such repayment
        at
        the rate provided in Section 1274(b)(2)(b) of the Code. Notwithstanding the
        foregoing, if any portion of the Tax Reimbursement Payment to be refunded
        to the
        Company has been paid to any Federal, state or local tax authority, repayment
        thereof shall not be required until actual refund or credit of such portion
        has
        been made to Executive, and interest payable to the Company shall not exceed
        interest received or credited to Executive by such tax authority for the
        period
        it held such portion. Executive and the Company shall mutually agree upon
        the
        course of action to be pursued (and the method of allocating the expenses
        thereof) if Executive’s good faith claim for refund or credit is
        denied.

       

      (vi) If
        the
        Excise Tax is later determined by the Accountants or pursuant to any proceeding
        or negotiations with the Internal Revenue Service to exceed the amount taken
        into account hereunder at the time the Tax Reimbursement Payment is made
        (including, but not limited to, by reason of any payment the existence or
        amount
        of which cannot be determined at the time of the Tax Reimbursement Payment),
        the
        Company shall make an additional Tax Reimbursement Payment in respect of
        such
        excess (plus any interest or penalty payable with respect to such excess)
        at the
        time that the amount of such excess is finally determined.

       

      (f)  Tax
        Compliance Delay in Payment.
        If the
        Company reasonably determines that any payment or benefit due under this
        Section
        8, or any other amount that may become due to Executive after termination
        of
        employment, is subject to Section 409A of the Internal Revenue Code of 1986
        (“Code”),
        as
        amended, and that Executive is a “specified employee,” as defined in Code
        Section 409A, upon termination of Executive’s employment for any reason other
        than death (whether by resignation or otherwise), no amount may be paid to
        Executive earlier than six months after the date of termination of Executive’s
        employment if such payment would violate the provisions of Code Section 409A
        and
        the regulations issued thereunder, and payment shall be made, or commence
        to be
        made, as the case may be, on the date that is six months and one day after
        the
        termination of Executive’s employment, together with interest at the rate of
        five percent (5%) per annum beginning with the date one day after the
        termination of Executive’s employment until the date of payment.

       

      Section
        9. Repayment
        By Executive. Executive
        acknowledges and agrees that the bonuses and other incentive-based or
        equity-based compensation received by him from the Company, and any profits
        realized from the sale of securities of the Company, are subject to the
        forfeiture requirements set forth in the Sarbanes-Oxley Act of 2002 and other
        applicable laws, rules and regulations, under the circumstances set forth
        therein. If any such forfeiture is required pursuant to the Sarbanes-Oxley
        Act
        of 2002 or other applicable law, rule or regulation, within thirty (30) days
        after notice thereof from the Company, Executive shall pay to the Company
        the
        amount required to be forfeited.

       

      Section
        10. Confidential
        Information; Ownership of Documents and Other Property.

       

      (a)  Confidential
        Information.
        Without
        the prior written consent of the Company, except as may be required by law,
        Executive will not, at any time, either during or after his employment by
        the
        Company, directly or indirectly divulge or disclose to any person, entity,
        firm
        or association, including, without limitation, any future employer, or use
        for
        his own or others benefit or gain, any financial information, prospects,
        customers, tenants, suppliers, clients, sources of leads, methods of doing
        business, intellectual property, plans, products, data, results of tests
        or any
        other trade secrets or confidential materials or like information of the
        Company, including (but not by way of limitation) any and all information
        and
        instructions, technical or otherwise, prepared or issued for the use of the
        Company (collectively, the “Confidential
        Information”),
        it
        being the intent of the Company, with which intent Executive hereby agrees,
        to
        restrict him from disseminating or using any like information that is not
        readily available to the general public.

       

      (b)  Information
        is Property of Company.
        All
        books, records, accounts, tenant, customer, client and other lists, tenant,
        customer and client street and e-mail addresses and information (whether
        in
        written form or stored in any computer medium) relating in any manner to
        the
        business, operations, or prospects of the Company, whether prepared by Executive
        or otherwise coming into Executive’s possession, shall be the exclusive property
        of the Company and shall be returned immediately to the Company upon the
        expiration or termination of Executive’s employment or at the Company’s request
        at any time. Upon the expiration or termination of his employment, Executive
        will immediately deliver to the Company all lists, books, records, schedules,
        data, and other information (including all copies) of every kind relating
        to or
        connected with the Company and its activities, business, and
        customers.

       

      Section
        11. Restrictive
        Covenant; Notice of Activities.
        

       

      (a)  Restricted
        Activities.
        During
        the Employment Period and for a period of one (1) year after the expiration
        or
        termination of Executive’s employment, whether by resignation or otherwise,
        (except if Executive’s employment is terminated by the Company without Cause or
        by Executive for Good Reason, or if Executive’s termination of employment
        constitutes a Termination Following Change in Control or results due to
        non-renewal of this Agreement), Executive shall not, without the prior written
        consent of the Company, directly or indirectly, (i) enter into the employment
        of, render any services to, invest in, lend money to, engage, manage, operate,
        own, or otherwise offer other assistance to or participate in, as an officer,
        director, manager, employee, principal, proprietor, representative, stockholder,
        member, partner, associate, consultant or otherwise, any person or entity
        that
        competes, plans to compete or is considering competing with the Company in
        any
        business of the Company existing or proposed at the time Executive shall
        cease
        to perform services hereunder (a “Competing
        Entity”)
        in any
        state in which the Company conducts material operations (defined as accounting
        for 10% or more of the Company’s revenue), or owns assets the value of which
        totals 10% or more of the total value of the Company’s assets, at any time
        during the term of this Agreement (collectively, the “Territory”);
        (ii)
        interfere with or disrupt or diminish or attempt to disrupt or diminish,
        or take
        any action that could reasonably be expected to disrupt or diminish, any
        past or
        present or prospective relationship, contractual or otherwise, between the
        Company and any tenant, customer, supplier, sales representative, consultant
        or
        employee of the Company; (iii) directly or indirectly solicit for employment
        or
        attempt to employ, or assist any other person or entity in employing or
        soliciting for employment, either on a full-time or part-time or consulting
        basis, any employee (whether salaried or otherwise, union or non-union) of
        the
        Company who within one year of the time Executive ceased to perform services
        hereunder had been employed by the Company, or (iv) communicate with, solicit,
        accept business or enter into any business relationship with any person or
        entity who was a tenant or customer of the Company or any present or future
        tenant or customer of the Company (including without limitation tenants or
        customers previously or in the future generated or produced by Executive),
        in
        any manner that interferes with or disrupts or diminishes or might interfere
        with or might disrupt or diminish such tenant’s or customer’s relationship with
        the Company, or in an effort to obtain such tenant or customer as a tenant
        or
        customer of any person in the Territory. Notwithstanding the foregoing,
        Executive shall be permitted to own up to a five percent equity interest
        in a
        publicly traded Competing Entity.

       

      (b)  Notice
        and Procedure.
        Executive
        shall inform in writing any person or entity that seeks to employ or engage
        him
        in any capacity, of his noncompetition obligations under this Agreement,
        prior
        to accepting such employment or engagement. Executive shall also inform the
        Company in writing of such prospective employment or engagement prior to
        accepting such employment or engagement. If the Company or the Executive
        has any
        concerns that any of Executive’s proposed or actual post-employment activities
        may be restricted by, or otherwise in violation of, this Section 11, such
        party
        shall notify the other party of such concerns and, prior to the Company
        commencing any action to enforce its rights under this Section 11 or Executive
        seeking a declaratory judgment with respect to his obligations under this
        Section 11, the Company and Executive shall meet and confer to discuss the
        prospective employment or engagement, and shall provide the other party with
        an
        opportunity to explain why such prospective employment or engagement either
        does
        or does not violate this Section 11; provided, however, that Company’s
        obligations to give notice under this clause and to meet with Executive before
        commencing any action shall not apply if Executive has not provided notice
        before engaging in activities that Company reasonably believes violate this
        Section 11. Any such meeting shall occur within three business days of notice
        and may be held in person or by telephonic, video conferencing or similar
        electronic means.

       

      Section
        12. Violations
        of Covenants.

       

      (a)  Injunctive
        Relief.
        Executive agrees and acknowledges that (i) the services to be rendered by
        him
        hereunder are of a special and original character that gives them unique
        value,
        (ii) that the provisions of Sections 10 and 11, are, in view of the nature
        of
        the business of the Company, reasonable and necessary to protect the legitimate
        interests of the Company, (iii) that his violation of any of the covenants
        or
        agreements contained in this Agreement would cause irreparable injury to
        the
        Company, (iv) that the remedy at law for any violation or threatened violation
        thereof would be inadequate, and (v) that the Company shall be entitled to
        temporary and permanent injunctive or other equitable relief as it may deem
        appropriate without the accounting of all earnings, profits, and other benefits
        arising from any such violation, which rights shall be cumulative and in
        addition to any other rights or remedies available to the Company. Executive
        hereby agrees that in the event of any such violation, the Company shall
        be
        entitled to commence an action, suit or proceeding in any court of appropriate
        jurisdiction for any such preliminary and permanent injunctive relief and
        other
        equitable relief.

       

      (b)  Enforcement.
        The
        Company and Executive recognize that the laws and public policies of the
        various
        states of the United States and the District of Columbia may differ as to
        the
        validity and enforceability of certain of the provisions contained herein.
        Accordingly, if any provision of this Agreement shall be deemed to be invalid
        or
        unenforceable, as may be determined by a court of competent jurisdiction,
        this
        Agreement shall be deemed to delete or modify, as necessary, the offending
        provision and to alter the balance of this Agreement in order to render the
        same
        valid and enforceable to the fullest extent permissible as
        aforesaid.

       

      Section
        13. “Key
        Man” Insurance. Executive
        agrees to facilitate the Company to purchase and maintain “Key Man Insurance” in
        an amount desired by the Company for the benefit of the Company and to
        reasonably cooperate with the Company and its designated insurance agent
        to
        facilitate the purchase and maintenance of such insurance. 

       

      Section
        14. Successors;
        Binding Agreement.

       

      (a)  Company’s
        Successors.
        No
        rights or obligations of the Company under this Agreement may be assigned
        or
        transferred except that the Company will require 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 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. As used in this Agreement, “Company” shall mean the Company as
        herein before defined and 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 that executes and delivers the agreement
        contemplated by this Section 14 or that otherwise becomes bound by all the
        terms
        and provisions of this Agreement by operation of law.

       

      (b)  Executive’s
        Successors.
        No
        rights or obligations of Executive under this Agreement may be assigned or
        transferred other than his rights to payments or benefits hereunder, which
        may
        be transferred only by will or the laws of descent and distribution. Upon
        Executive’s death, this Agreement and all rights of Executive hereunder shall
        inure to the benefit of and be enforceable by Executive’s beneficiary or
        beneficiaries, personal or legal representatives, or estate, to the extent
        any
        such person succeeds to Executive’s interests under this Agreement. Executive
        shall be entitled to select and change a beneficiary or beneficiaries to
        receive
        any benefit or compensation payable hereunder following Executive’s death by
        giving the Company written notice thereof. In the event of Executive’s death or
        a judicial determination of his incompetence, references in this Agreement
        to
        Executive shall be deemed, where appropriate, to refer to his beneficiary(ies),
        estate or other legal representative(s). If Executive should die following
        his
        Date of Termination while any amounts would still be payable to him hereunder
        if
        he had continued to live, all such amounts unless otherwise provided herein
        shall be paid in accordance with the terms of this Agreement to such person
        or
        persons so appointed in writing by Executive, or otherwise to his legal
        representatives or estate.

       

      Section
        15. Notice.
        All
        notices or other communications that are required or permitted hereunder
        shall
        be in writing and sufficient if delivered personally, or sent by
        nationally-recognized, overnight courier or by registered or certified mail,
        return receipt requested and postage prepaid, addressed as follows:

       

      
        	
                 

                To
                  the Employer:

                 

              	
                Equity
                  One, Inc.

                1600
                  NE Miami Gardens Drive

                North
                  Miami Beach, Florida 33179

                Attention:
                  General Counsel

                 

              
	
                 

                To
                  Executive:

                 

              	
                Jeffrey
                  S. Stauffer

                Equity
                  One, Inc.

                1600
                  NE Miami Gardens Drive

                North
                  Miami Beach, Florida 33179

              

      

      

      or
        to
        such other address as any party may have furnished to the others in writing
        in
        accordance herewith. All such notices and other communications shall be deemed
        to have been received (a) in the case of personal delivery, on the date of
        such
        delivery, (b) in the case of delivery by nationally-recognized, overnight
        courier, on the business day following dispatch and (c) in the case of mailing,
        on the third business day following such mailing.

       

      Section
        16. Attorneys’
        Fees.
        The
        Company shall reimburse Executive for the reasonable attorneys’ fees and costs
        incurred by Executive in connection with the review, negotiation and execution
        of this Agreement. If either party is required to seek legal counsel to
        interpret or enforce the terms and provisions of this Agreement, the prevailing
        party in any action, suit or proceeding shall be entitled to recover reasonable
        attorneys’ fees and costs (including on appeal).

       

      Section
        17. Miscellaneous. 
        No
        provisions of this Agreement may be amended, modified, or waived unless such
        amendment or modification is agreed to in writing signed by Executive and
        by a
        duly authorized officer of the Company, and such waiver is set forth in writing
        and signed by the party to be charged. No waiver by either party hereto at
        any
        time of any breach by the other party hereto of any condition or provision
        of
        this Agreement to be performed by such other party shall be deemed a waiver
        of
        similar or dissimilar provisions or conditions at the same or at any prior
        or
        subsequent time. No agreements or representations, oral or otherwise, express
        or
        implied, with respect to the subject matter hereof have been made by either
        party that are not set forth expressly in this Agreement. The respective
        rights
        and obligations of the parties hereunder of this Agreement shall survive
        the
        expiration or termination of Executive’s employment (whether by resignation or
        otherwise) and the expiration or termination of this Agreement to the extent
        necessary for the intended preservation of such rights and obligations. The
        validity, interpretation, construction and performance of this Agreement
        shall
        be governed by the laws of the State of Florida without regard to its conflicts
        of law principles. Each party unconditionally and irrevocably agrees that
        the
        exclusive forum and venue for any action, suit or proceeding shall be in
        Miami-Dade County, Florida, and consents to submit to the exclusive
        jurisdiction, including, without limitation, personal jurisdiction, and forum
        and venue of the Circuit Courts of the State of Florida or the United States
        District Court for the Southern District of Florida, in each case, located
        in
        Miami-Dade County, Florida.

       

      Section
        18. Validity.
        The
        invalidity or unenforceability of any provision or provisions of this Agreement
        shall not affect the validity or enforceability of any other provision of
        this
        Agreement, which shall remain in full force and effect. In the event that
        any
        provision or provisions contained in this Agreement shall be deemed illegal
        or
        unenforceable, the remaining provisions contained in this Agreement shall
        remain
        in full force and effect, and this Agreement shall be interpreted as if such
        illegal or unenforceable provision or provisions were not contained in this
        Agreement. 

       

      Section
        19. Counterparts.
        This
        Agreement may be executed in one or more counterparts, each of which shall
        be
        deemed to be an original but all of which together will constitute one and
        the
        same instrument.

       

      Section
        20. Entire
        Agreement.
        This
        Agreement sets forth the entire agreement of the parties hereto in respect
        of
        the subject matter contained herein and supersedes all prior agreements,
        promises, covenants, arrangements, communications, representations or
        warranties, whether oral or written, by any officer, director, employee or
        representative of any party hereto in respect of such subject matter. Any
        prior
        agreement of the parties hereto in respect of the subject matter contained
        herein is hereby terminated and canceled.

       

      Section
        21. Withholding.
        All
        payments hereunder shall be subject to any required withholding of Federal,
        state and local taxes pursuant to any applicable law or regulation.

       

      Section
        22. Insurance;
        Indemnity.
        Executive shall be covered by the Company’s directors’ and officers’ liability
        insurance policy, and errors and omissions coverage, to the extent such coverage
        is generally provided by the Company to its directors and officers and to
        the
        fullest extent permitted by such insurance policies. Nothing herein is or
        shall
        be deemed to be a representation by the Company that it provides, or a promise
        by the Company to obtain, maintain or continue any liability insurance coverage
        whatsoever for its executives. In addition, the Company shall enter into
        its
        standard indemnity agreement by which Company commits to indemnify a Company
        officer in connection with claims, suits or proceedings arising as a result
        of
        Executive’ service to the Company. 

       

      Section
        23. Section
        Headings.
        The
        section headings in this Agreement are for convenience of reference only,
        and
        they form no part of this Agreement and shall not affect its
        interpretation.

       

      [Remainder
        of this Page Intentionally left Blank]

      
        
          
          

        

        
          
          

          
          

        

        
          
          

        

      

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

      

      

      

      
        	
                 

              	
                EQUITY
                  ONE, INC.

              
	
                 

              	
                 

              	
                 

              
	
                 

              	
                By:

              	
                /s/

              	
                JEFFREY
                  OLSON

              	
                 

              
	
                 

              	
                 

              	
                Name:

              	
                Jeffrey
                  Olson

              	
                 

              
	
                 

              	
                 

              	
                Title:

              	
                President

              	
                 

              
	
                 

              	
                 

              	
                Date:
                  November 6, 2006

              
	
                 

              	
                 

              	 
	 	 	 
	
                 

              	
                /s/
                  Jeffrey S. Stauffer

              	
                 

              
	 	
                Jeffrey
                  S. Stauffer

              
	 	
                Date:
                  November 4, 2006

              

      

      

      

      Exhibit
        A
        - Long Term Cash Incentive Compensation

      Exhibit
        B
        - Form of Release

      

      

      

      

      
        
          
            #480824.8Exhibit 10.4

    

      EXHIBIT
        10.5

      

      SECOND
        AMENDMENT TO AMENDED AND RESTATED

      EMPLOYMENT
        AGREEMENT

       

      This
        SECOND AMENDMENT TO AMENDED AND RESTATED EMPLOYMENT AGREEMENT (the “Amendment”),
        is
        made this 3rd day of November, 2006, between EQUITY ONE, INC., a Maryland
        corporation (the “Company”
or
        “Employer”)
        and
        Doron Valero (the “Employee”).

       

      The
        Company and the Employee have heretofore entered into an Amended and Restated
        Employment Agreement dated as of July 26, 2002, as amended by that certain
        First
        Amendment to Amended and Restated Employment Agreement dated September 1,
        2003
        (the “Agreement”)
        (capitalized terms used herein and not otherwise defined shall have the meanings
        set forth in the Agreement). The Employer and Employee have agreed that the
        Employee will resign from his positions as Director, President and Chief
        Operating Officer on the date hereof, but shall continue as an employee of
        the
        Company under the Agreement, as modified by the terms and conditions hereof.
        

       

      NOW,
        THEREFORE,
        in
        consideration of the premises and the mutual covenants set forth below, the
        parties hereby agree as follows:

       

      1. Amendments.
        Effective as of the date hereof, the Agreement shall be amended as
        follows:

       

      (a) Section
        2
        of the Agreement shall be amended in its entirety to read as
        follows:

       

      “From
        the
        Effective Date through midnight on November 2, 2006, the Employee is engaged
        to
        act as President and Chief Operating Officer of the Employer and shall report
        to
        the Chairman of the Board and Chief Executive Officer of the Employer. Subject
        to the authority of the Board of Directors and the Chairman of the Board,
        the
        Employee shall be in charge of the day-to-day operations of the Employer’s
        business and shall have full authority and responsibility for supervising
        and
        managing the Employer’s properties. His powers shall include the authority to
        hire and fire personnel, after consultation with the Chairman of the Board
        and
        Chief Executive Officer. In addition, the Employee shall have such other
        duties
        as may from time to time be reasonably assigned to him by the Board of Directors
        and Chairman of the Board and Chief Executive Officer. Commencing November
        3,
        2006 until the end of the term hereof, the Employee shall serve as Operations
        Advisor for the Company and shall report to the Chairman of the Board of
        the
        Employer and shall have such duties as may be reasonably assigned to him
        by the
        Chairman of the Board.”

       

      (b) Section
        5
        of the Agreement shall be amended by adding the following clause at the end
        of
        such section:

       

      “Employee
        shall have the right to exercise all vested options within the six (6) month
        period immediately following Employee’s termination of employment (including
        following the expiration of the term of the Agreement), provided, however,
        that
        in the event Employee voluntarily terminates Employee’s employment, or the
        Company terminates Employee’s employment for Cause, Employee shall only have
        ninety (90) days following termination of employment to exercise Employee’s
        options. In addition, subject to the execution of the release attached hereto
        as
Exhibit
        A,
        all
        unvested restricted stock and options shall vest upon the expiration of the
        term
        hereof.”

       

      (c) The
        Agreement shall be additionally modified by adding the following provision
        at
        the end thereof:

       

      “27. Non-Disparagement.
        Employee covenants and agrees, both during and after the term of the Agreement,
        that he shall not make any comments that could be construed as negative
        concerning the Employer or any of the its affiliates to any individual or
        entity, including but not limited to, stockholders, tenants, employees, vendors
        or financial or credit institutions.”

       

      2. Acknowledgment
        of Non-Renewal.
        The
        parties hereto acknowledge that the Employee properly gave notice of his
        intent
        not to renew the Agreement pursuant to Section 1 thereof on August 4, 2006
        and
        has contemporaneously herewith resigned from his positions as a Director,
        President and Chief Operating Officer of the Company, none of which actions
        shall be deemed as a “voluntary resignation” or other termination of the
        Agreement, which shall, except
        as
        otherwise expressly modified by the terms and provisions of this Amendment,
        remain in full force and effect, and is hereby in all respects confirmed
        and
        ratified by the parties hereto.

       

      3. Effective
        Date.
        This
        Amendment shall be effective upon its execution by the Company and the
        Employee.

       

      4. Counterparts.
        This
        Amendment may be executed in counterparts and by different parties hereto
        in
        separate counterparts each of which, when so executed and delivered, shall
        be
        deemed to be an original and all of which, when taken together, shall constitute
        one and the same instrument.

       

      5. References
        to Agreement.
        From
        and after the effective date hereof, each reference in the Agreement to “this
        Agreement,” “hereto,” “hereunder” or words of like import, and all references to
        the Agreement in any and all agreements, instruments, documents, notes,
        certificates and other writings of every kind and nature shall be deemed
        to mean
        the Agreement as modified and amended by this Amendment.

       

      

       

       

      
        
          
          

          
            
              
              

            

            
              
              

              
                

              

            

            
              
              

            

          

        

        
          
          

          
          

        

        
          
          

        

      

      IN
        WITNESS WHEREOF,
        the
        Company and the Employee have executed this Second Amendment to Amended and
        Restated Employment Agreement as of the date first written above.

       

      THE
        COMPANY:

       

       

       

      EQUITY
        ONE, INC

       

      

       

      By:     
        /s/ CHAIM KATMAN     

      Chaim
        Katzman

      Chairman
        and Chief Executive Officer

       

      

       

          THE
        EMPLOYEE:

       

      

       

                                                            /s/
        DORON
        VALERO

               
        Doron Valero

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