Document:

Exhibit 10.8

 

EXECUTION VERSION 

 

 

August 3, 2015

 

Lawrence Kreider

4611 12th Avenue, Suite 1L

Brooklyn, New York 11219

 

		Re:	Terms of Employment

 

Dear Larry,

 

This letter (this
“Letter”) sets forth the term of your employment with Clipper Realty L.P., a Maryland limited partnership (the
“Company”).

 

		1.	Commencement Date

 

This Letter is being entered
into in connection with the Rule 144A offering (the “Offering”) of the shares of common stock of Clipper Realty
Inc., a Maryland corporation (“Parent”). Your employment under this Letter will begin on the date that the Offering
closes (the “Commencement Date”). In the event that the Offering is not completed prior to December 31, 2015
or your employment terminates prior to the closing of the Offering, this Letter will be null, void in its entirety and without
effect.

 

		2.	Term

 

Your employment under this Letter
will begin on the Commencement Date and will continue until either you or the Company terminates such employment. Your employment
with the Company will be for an unspecified duration and constitutes “at will” employment. Your employment may be terminated
at any time for any reason or no reason, at the option of you or the Company, subject to the obligations under this Letter. Upon
termination of your employment with the Company, at the request of the Company you will promptly resign from any officer position,
directorship or any other position in which you act as a fiduciary of or for the Company, Parent or any of their subsidiaries (collectively,
the “Group”).

 

    	 	 	 

    
Lawrence Kreider
 August 3, 2015
 Page 2

    

 

		3.	Position and Duties

 

		3.1	Position and Reporting. You will serve the Company and Parent in the position of Chief Financial
Officer (your “Position”). In those capacities, you will report directly to the Company’s Chief Executive
Officer. You understand, acknowledge and agree that you will be employed by the Company but will be providing services to both
the Company and, to the extent appropriate or necessary, Parent.

 

		3.2	Duties and Responsibilities. You are required to perform the duties that are customarily
associated with and appropriate to the Position, or which are delegated to you, from time to time, by the Company’s Chief
Executive Officer or the Company’s Board of Directors (the “Board”). Unless otherwise designated by the
Company’s Chief Executive Officer or the Board, you will primarily perform such duties at the Company’s office in Brooklyn,
New York (your “Primary Work Site”), subject to required travel where appropriate to execute such duties and
such other terms and conditions provided in this Letter.

 

		3.3	Performance. You will devote substantially all of your business time and attention to
the Group and will use good faith efforts to discharge your responsibilities under this Letter to the best of your ability. Unless
you have the Company’s written consent, you may not: (i) engage in any activities, including but not limited to directorships
or personal business activities, where a conflict might arise as between those activities and the Group’s interests; or (ii) perform
any other work which interferes with your ability to perform your duties for the Group, whether or not a conflict of interest might
arise as between that other work and the Group’s interests. You also understand, acknowledge and agree that you will comply
with the Investment Policy while you are employed by the Company.

 

		4.	Compensation

 

		4.1	Salary. Your annual base salary is $325,000 (as may be increased or decreased from time
to time, your “Salary”), payable in accordance with the Company’s normal practices for senior executives.
The Compensation Committee of the Board will review your Salary at least annually and may increase it at any time for any reason.
However, your Salary may not be decreased at any time (including after any increase) other than as part of an across-the-board
salary reduction that applies in the same manner to all senior executives, and any increase in your Salary will not reduce or limit
any other obligation to you under this Letter.

 

		4.2	Future Annual Cash Bonus. Beginning with the calendar year ending December 31, 2015, you
will be entitled to earn an annual cash incentive bonus (your “Bonus”) for each calendar year of the Company
ending during your employment (for the avoidance of doubt, your Bonus for 2015 will not be subject to proration). Your target Bonus
opportunity will be 46% of your Salary (e.g., $150,000 for 2015), and your actual Bonus will range from 0% to 100% of your target
bonus opportunity based on actual performance against performance metrics established by the Compensation Committee of the Board
and be paid within two and one half months after the end of the calendar year to which it relates. The Compensation Committee of
the Board, in its sole discretion, will establish the specific performance targets for each calendar year. Your Bonus will be subject
to the terms of the Group plan under which it is awarded (including applicable performance metrics and any deferral requirements)
and any Group clawback or recoupment policy in effect from time to time. You expressly agree to comply with any such policy in
all regards.

 

    	 	 	 

    
Lawrence Kreider
 August 3, 2015
 Page 3

    

 

		4.3	Equity Awards. You will be granted, in connection with the Offering, a one-time award of
restricted LTIP units with a value of $630,000 (the “144A Grant”), based on the Offering price of $13.50
per share. The 144A Grant will be granted on or as soon as practicable following the closing of the Offering and will cliff vest
on the third anniversary of the grant date. Your 144A Grant will be subject to the terms of the Parent equity plan under which
it is granted and to the terms of the applicable award agreement.

 

Beginning in
2016 and for any future calendar years during your employment, you will be eligible to receive a long-term incentive compensation
award (“LTI Award”) in form, including vesting restrictions, and amount determined in the sole discretion of
the Board (or the Compensation Committee of the Board). Your LTI Awards, including the LTI Award granted in 2016, will be subject
to the terms of the Parent equity plan under which it is granted and the applicable award agreement.

 

		5.	Benefits

 

During your employment, you will
be entitled to participate in each of the Group’s employee benefit and welfare plans, including plans providing retirement
benefits or medical, dental, hospitalization, life or disability insurance, on a basis that is at least as favorable as that generally
provided to other senior executives of the Group. You will be entitled to paid time off and other types of leave on a basis that
is at least as favorable as that provided to other senior executives of the Group. You will be reimbursed for all reasonable business
and entertainment expenses incurred by you in performing your responsibilities under this Letter that are submitted in accordance
with the Group’s policy.

 

		6.	Indemnification and Advancement of Expenses

 

To the extent permitted by law
and subject to the Parent’s articles of incorporation and bylaws, the Company will indemnify you against any actual or threatened
action, suit or proceeding against you, whether civil, criminal, administrative or investigative, arising by reason of your status
as a director, officer, employee and/or agent of the Group during your employment. In addition, to the extent permitted by law
and subject to the Parent’s articles of incorporation and bylaws, the Company will advance or reimburse any expenses, including
reasonable attorney’s fees, you incur in investigating and defending any actual or threatened action, suit or proceeding
for which you may be entitled to indemnification under this Section 6. However, you agree to repay any expenses paid
or reimbursed by the Company if it is ultimately determined that you are not legally entitled to be indemnified by the Company.

 

    	 	 	 

    
Lawrence Kreider
 August 3, 2015
 Page 4

    

 

		7.	Company Property

 

		7.1	All material, including but not limited to written material whether in hard copy or electronic
format, created by you or which comes into your possession or control in the course of your employment with the Group, is the property
of the Group.

 

		7.2	When your employment with the Company ends, or when otherwise directed by the Company, you must
return all of the Group’s property in your possession or control including, but not limited to, all material (whether written
material in hard copy or electronic format), keys, access cards, vehicles owned or leased by the Group, phones, computers or discs.
When directed by the Company, instead of returning such property to the Group, you must destroy it and certify in writing to the
Company that you have done so.

 

		7.3	You agree that any intellectual property created or developed by you (whether by yourself or with
others) in the course of your employment with the Group will belong exclusively to the Group. By signing this Letter you: (i) assign
to the Group all rights in any intellectual property (including all rights of copyright and patent) created or developed by you
(whether by yourself or with others) in the course of your employment, including the right to develop, make, use, sell, license
or otherwise benefit from the intellectual property; and (ii) agree to execute any documents necessary or desirable to give effect
to your obligations in this Section 7.3.

 

		7.4	You consent to the Group doing or omitting to do anything that would otherwise infringe your rights
in any copyright works created or developed by you (whether alone or with others) in the course of your employment with the Company.

 

		8.	Confidential Information

 

		8.1	You agree that during your employment with the Company, and after your employment with the Company
ends, you must not use or disclose to any person any Proprietary Information which you acquire during your employment with the
Company, except if that use or disclosure is in the proper course of your employment for the Group’s benefit, with the Company’s
written consent, or as required by law. You agree that during your employment you will use your best endeavors to maintain proper
and secure custody of any Proprietary Information and to prevent the publication, use or disclosure of any Proprietary Information,
including by a third party.

 

“Proprietary Information”
means confidential or proprietary information, knowledge or data concerning (i) the Group’s businesses, strategies, operations,
financial affairs, organizational matters, personnel matters, budgets, business plans, marketing plans, studies, policies, procedures,
products, ideas, processes, software systems, trade secrets and technical know-how, (ii) any other matters relating to the Group
and (iii) any matter relating to clients of the Group or other third parties having relationships with the Group. Proprietary Information
includes (i) information regarding any aspect of your tenure as an employee of the Group or the termination of your employment,
(ii) the names, addresses, and phone numbers and other information concerning clients and prospective clients of the Group, (iii)
investment techniques and trading strategies used in, and the performance records of, client accounts or other investment products,
and (iv) information and materials concerning the personal affairs of employees of the Group. In addition, Proprietary Information
may include information furnished to you orally or in writing (whatever the form or storage medium) or gathered by inspection,
in each case before or after the date of this Letter.

 

    	 	 	 

    
Lawrence Kreider
 August 3, 2015
 Page 5

    

 

		8.2	These obligations do not apply to Proprietary Information which is publicly available, unless that
information is publicly available because you have, directly or indirectly, breached any of your obligations with respect to that
information. If it is uncertain whether any information is publicly available, the information is deemed not to be publicly available,
unless the Company informs you in writing to the contrary.

 

		8.3	Nothing in this Letter prohibits you from providing truthful testimony concerning the Group to
governmental, regulatory or self-regulatory authorities, including your right to make disclosures under the whistleblower provisions
of federal law or regulation, so long as you give the Company written notice of such testimony (if legally permitted) as soon as
practicable under the circumstances to enable the Group to seek a protective order, confidential treatment or other appropriate
relief and cooperate with the Group in seeking to do so.

 

		9.	Termination of Employment

 

		9.1	Related Definitions.

 

		(a)	“Cause” means the occurrence of any of the following: (i) your conviction of,
or plea of guilty or no contest to, any felony or any crime involving fraud or moral turpitude under the laws of the United States
or any state thereof or under the laws of any other jurisdiction; (ii) your engagement in gross misconduct that causes material
financial or reputational harm to the Group; (iii) your material violation of this Letter or any written Company policy (including,
but not limited to, the Investment Policy) or (iv) your disqualification or bar by any governmental or self-regulatory authority
from serving in the capacity required by your job description or your loss of any governmental or self-regulatory license that
is reasonably necessary for you to perform your duties or responsibilities, in each case as an employee of the Group. The Group
may place you on unpaid leave for up to 60 consecutive days while it is determining whether there is a basis to terminate your
employment for Cause.

 

		(b)	“Disability” will have the meaning provided in the Group’s disability
policy, as may be amended from time to time.

 

		9.2	Without Cause. If the Company terminates your employment without Cause, subject to Section 9.5,
the only further obligations the Group will have to you are:

 

		(a)	The Company will:

 

    	 	 	 

    
Lawrence Kreider
 August 3, 2015
 Page 6

    

 

		(i)	within 30 days of your termination, pay you (A) your unpaid Salary; (B) your Salary for any accrued but unused paid
time off; and (C) reimbursement of any business expenses submitted in accordance with the Group’s policy; and

 

		(ii)	provide to you, in accordance with the then-existing employee benefit plans, policies and practices of the Group, all other
accrued and vested benefits

 

((i) and (ii)
together, your “Accrued Compensation”).

 

		(b)	The Company will pay you your Earned Bonus, as hereinafter defined, at the time such Earned Bonus
would otherwise have been paid had your employment not ended. Your “Earned Bonus” means any earned but unpaid
Bonus for any calendar year ending before the end of your employment and, to the extent it has not been determined before the end
of your employment, determined based on actual performance consistent with this Letter and the Group plan under which it was awarded.

 

		(c)	The Company will pay you your Prorated Bonus, as hereinafter defined, at the time such Prorated
Bonus would otherwise have been paid had your employment not ended. Your “Prorated Bonus” means the Bonus for
the calendar year in which your termination occurs based on the actual performance of the Company consistent with this Letter and
the Group plan under which it was awarded, and prorated for the number of days you worked for the Company during such year.

 

		(d)	The Company will pay you cash severance under, and pursuant to the terms of, the Company’s
general severance plan or policy as in effect on your termination date (the “Severance Payment”).

 

		(e)	The Company will, at the Company’s election, either (i) continue to provide to you benefits
under the Company’s group health insurance, vision and dental plans at the level provided to you immediately prior to your
termination date through the 12-month anniversary date of such termination date, at which time you may be eligible to elect to
continue health care and dental coverage under COBRA, or (ii) pay you a lump-sum cash payment equal to 12 times the monthly
COBRA cost of continued health and medical coverage for you and, as applicable, your covered spouse and/or dependents at the level
provided to you immediately prior your termination date, with such payment grossed up for applicable taxes.

 

		(f)	Any outstanding LTI Awards and the 144A Grant will continue to vest on the vesting date(s) specified
in the applicable award agreement, as if you had remained employed through such date(s), subject to your continued compliance with
the restrictive covenants contained in Sections 8 and 11 of this Letter and in any other agreement with the Group.

 

    	 	 	 

    
Lawrence Kreider
 August 3, 2015
 Page 7

    

 

		9.3	For Cause or Resignation for Any Reason. If the Company terminates your employment for Cause
or you terminate your employment for any reason, the Company will pay you your Accrued Compensation. The Group will have no further
obligations to you, and you will forfeit your Earned Bonus, Prorated Bonus, and any unvested portion of your LTI Awards and 144A
Grant.

 

		9.4	Death or Disability. If your employment terminates as a result of your death or Disability,
the only further obligations the Group will have to you are: (i) the Company will pay you your Accrued Compensation, your
Earned Bonus and your Prorated Bonus, and (ii) your LTI Awards and 144A Grant will vest in accordance with the terms of the applicable
award agreement, subject to your continued compliance with the restrictive covenants contained in Sections 8 and 11
of this Letter and in any other agreement with the Group.

 

		9.5	Release. Notwithstanding anything to the contrary, the Company will not be required to make
the payments and provide the benefits in Sections 9.2 (other than the Accrued Compensation) unless you execute and deliver
to the Company an agreement releasing from all liability each member of the Group and any of their respective past or present officers,
directors, employees or agents (the “Release”). For the avoidance of doubt, the parties acknowledge that your
right to elect COBRA coverage is not subject to your execution of a Release. The Release will be in the form normally used by the
Company for senior executives at the time and will be provided to you no later than two days after your separation from service,
and must be executed by you and become effective (i.e., the period for revocation must have expired) and not be revoked by you
by the 55th day following your separation of service (the period following your termination until the Release becomes effective,
the “Release Period”). Any payments or benefits that would have been paid or provided to you during the Release
Period will be paid or provided on the next regularly scheduled Company payroll date following the Release Period.

 

		9.6	If you violate any of the restrictive covenants contained in Sections 8 and 11 of
this Letter, you will (i) forfeit any LTI Awards and the 144A Grant to the extent that they have not vested at the time of
such violation and (ii) forfeit any unpaid Severance Payment. Nothing in this Section 9.6 will be construed as prohibiting
the Company from pursuing any other remedies available to it in the event of a violation of Sections 8 or 11.

 

		10.	Deductions

 

Either during your employment
or when your employment with the Company ends, you authorize the Group to deduct any amount of money that you owe the Group from
any amount of money the Group owes you.

 

		11.	Post-Employment Obligations

 

		11.1	Non-Competition and Non-Solicitation. You agree that during your employment with the Group
and for a period of 12 months from the date your employment with the Group ends for any reason, you must not, without
the Company’s prior written consent (a) engage in a Competitive Enterprise or (b) directly or indirectly (including via a
corporate entity) Solicit or entice, or endeavor to Solicit or entice, from the Group any officer or employee of the Group with
whom you have had direct or indirect contact or dealings, or knowledge of, during the 12 months prior to your termination date.

 

    	 	 	 

    
Lawrence Kreider
 August 3, 2015
 Page 8

    

 

		11.2	Related Definitions.

 

		(a)	“Competitive Enterprise” means any (i) multi-family or commercial property
located in the metropolitan New York City area or (ii) business enterprise that holds a 25% or greater equity, voting or profit
participation interest in any such property; provided that a Competitive Enterprise will not include (1) any “Excluded
Assets” (as defined in the Investment Policy) or (2) any investment opportunity which has been offered to the Company
and the Board (or an independent committee of the Board), and either (A) such offeree has determined that the Company will not
pursue such investment opportunity or (B) such offeree has not responded to indicate that the Company shall pursue such investment
opportunity within 30 days after such offer was made.

 

		(b)	“Solicit” means any direct or indirect communication, regardless of who initiates
it, that in any way invites, advises, encourages or requests any person to take or refrain from taking any action.

 

		11.3	Notice to New Employers. Before you either apply for or accept employment with any other
person or entity while Section 11.1 is in effect, you will provide the prospective employer with written notice of
the provisions of this Section 11 and will deliver a copy of the notice to the Company.

 

		11.4	Future Cooperation. You agree that, upon the Company’s reasonable request following
your termination of employment, you will use reasonable best efforts to assist and cooperate with the Company in connection with
the defense or prosecution of any claim that may be made against or by the Group arising out of events occurring during your employment,
or in connection with any ongoing or future investigation or dispute or claim of any kind involving the Group, including any proceeding
before any arbitral, administrative, regulatory, self-regulatory, judicial, legislative, or other body or agency. You will be entitled
to reimbursement for reasonable out-of-pocket expenses (including travel expenses) incurred in connection with providing such assistance.

 

		11.5	Non-Disparagement. You agree that you will not at any time publicly disparage or encourage
or induce others to publicly disparage the Group (or any of its employees, officers, directors, shareholders, owners, representatives,
independent contractors, agents, businesses or services) and/or engage in any conduct that is in any way injurious to the reputation
or interests of the Group, including without limitation, any negative or derogatory statements or writings.

 

    	 	 	 

    
Lawrence Kreider
 August 3, 2015
 Page 9

    

 

		11.6	Your Importance to the Group and the Effect of this Section 11. You acknowledge that:

 

		(a)	In the course of your involvement in the Group’s activities, you will have access to Proprietary
Information and the Group’s client base and will profit from the goodwill associated with the Group. In light of your access
to Proprietary Information and your importance to the Group, if you compete with the Group for some time after your employment,
the Group will likely suffer significant harm. In return for the benefits you will receive from the Group and to induce the Group
to enter into this Letter, and in light of the potential harm you could cause the Group, you agree to the provisions of this Section
11. The Company would not have entered into this Letter if you did not agree to this Section 11.

 

		(b)	This Section 11 limits your ability to earn a livelihood in a Competitive Enterprise and your relationships with clients.
You acknowledge, however, that complying with this Section 11 will not result in severe economic hardship for you or your
family.

 

		12.	Effect of 280G Excise Tax

 

		12.1	In the event that the payments and other benefits provided for in this Letter or otherwise payable
to you (collectively, “Benefits”) (i) constitute “parachute payments” within the meaning of Section
280G of the Internal Revenue Code of 1986 (the “Code”) and (ii) but for this Section 12.1, would be subject
to the excise tax imposed by Section 4999 of the Code, then your Benefits will be either:

 

		(a)	delivered in full, or

 

		(b)	delivered as to such lesser extent which would result in no portion of such Benefits being subject
to the excise tax under Section 4999 of the Code,

 

whichever of the foregoing amounts,
taking into account the applicable federal, state and local income taxes and the excise tax imposed by Section 4999 of the Code,
results in the receipt by you, on an after-tax basis, of the greatest amount of Benefits. The Benefits to be reduced under this
Section 12.1 will be determined in a manner which has the least economic cost to you and, to the extent the economic cost
is equivalent, will be reduced in the inverse order of when the Benefits would have been made to you.

 

		12.2	The determinations to be made with respect to Section 12.1 will be made by a certified public
accounting firm (the “Accountant”) designated
by the Company. As part of such determinations, the Accountant will conduct a valuation of any restrictions on your ability to
compete. The Company will be responsible for all charges of the Accountant.

 

		13.	Section 409A

 

		13.1	This Letter is intended to comply with Section 409A of the Code (“Section 409A”)
to the extent it is subject thereto, and the Letter will be interpreted on a basis consistent with such intent. If and to the extent
that any payment or benefit under this Letter, or any plan, award agreement or arrangement of the Group, constitutes “non-qualified
deferred compensation” subject to Section 409A, such payments and benefits may only be made or satisfied under this Letter
upon an event and in a manner permitted by Section 409A. Each payment of compensation under this Letter will be treated as a separate
payment of compensation for purposes of Section 409A to the extent Section 409A applies to such payments.

 

    	 	 	 

    
Lawrence Kreider
 August 3, 2015
 Page 10

    

 

		13.2	Notwithstanding anything in this Letter to the contrary, if you are considered a “specified
employee” for purposes of Section 409A, (i) if payment of any amounts under this Letter is required to be delayed for a period
of six months after separation from service pursuant to Section 409A, payment of such amounts will be delayed as required by Section
409A and will, subject to Section 9.5, be paid in a lump sum payment within fifteen days after the end of the six-month
period and (ii) in the event any equity-based awards held by you that vest upon termination of your employment constitute “non-qualified
deferred compensation” subject to Section 409A, the delivery of shares or cash (as applicable) in settlement of such awards
will be made on the earliest permissible payment date (including the date that is six months after separation from service pursuant
to Section 409A) or event under Section 409A on which the shares or cash would otherwise be delivered or paid. If you die during
the postponement period prior to the payment of any amounts or benefits or delivery of shares, the amounts and entitlements delayed
on account of Section 409A will be paid or provided to the personal representative of your estate within 60 days after the date
of your death.

 

		13.3	All payments to be made upon a termination of employment under this Letter that constitute “non-qualified
deferred compensation” subject to Section 409A may only be made upon a “separation from service” under Section
409A. In no event may you, directly or indirectly, designate the calendar year of a payment. All reimbursements and in-kind benefits
provided under this Letter will be made or provided in accordance with the requirements of Section 409A, including, where applicable,
the requirement that (i) the amount of expenses eligible for reimbursement, or in-kind benefits provided, during a calendar year
may not affect the expenses eligible for reimbursement, or in-kind benefits to be provided, in any other calendar year; (ii) the
reimbursement of an eligible expense will be made no later than the last day of the calendar year following the year in which the
expense is incurred; and (iii) the right to reimbursement or in-kind benefits is not subject to liquidation or exchange for another
benefit.

 

		14.	Dispute Resolution

 

		14.1	Mandatory Arbitration. Subject to the provisions of this Section 14, any dispute
involving your employment or this Letter will be finally settled by binding arbitration in the County of Manhattan administered
by the American Arbitration Association, the FINRA, JAMS/Endispute, or any other similar association mutually agreed to by the
Company and you. The award of the arbitrators will be final and binding and judgment upon the award may be entered in any court
having jurisdiction thereof. This procedure will be the exclusive means of settling any disputes that may arise under this Letter.
Each party will bear its own attorney’s fees and legal expenses and will share equally the fees and expenses of the arbitration;
provided that if you prevail on any material issue (as determined by the arbitrators), the Company will reimburse you for reasonable
attorney’s fees and legal expenses incurred in connection with such claim.

 

    	 	 	 

    
Lawrence Kreider
 August 3, 2015
 Page 11

    

 

		14.2	Injunctions and Enforcement of Arbitration Awards. You or the Group may bring an action
or special proceeding in a state or federal court of competent jurisdiction sitting in the County of Manhattan to enforce any arbitration
award under Section 14.1. Also, the Group may bring such an action or proceeding, in addition to its rights under Section 14.1
and whether or not an arbitration proceeding has been or is ever initiated, to temporarily, preliminarily or permanently enforce
any part of Sections 8 and 11. You agree that (i) your violating any part of Sections 8 and 11
would cause damage to the Group that cannot be measured or repaired, (ii) the Group therefore is entitled to an injunction, restraining
order or other equitable relief restraining any actual or threatened violation of those Sections, (iii) no bond will need to be
posted for the Group to receive such an injunction, order or other relief, (iv) no proof will be required that monetary damages
for violations of those Sections would be difficult to calculate and that remedies at law would be inadequate and (v) that the
General Counsel of the Company is irrevocably appointed as your agent for service of process in connection with any such action
or proceeding (the General Counsel will promptly advise you of any such service of process).

 

		14.3	Waiver of Jury Trial. To the extent permitted by law, you and the Group waive any and all
rights to a jury trial with respect to any dispute involving your employment or this Letter.

 

		14.4	Governing Law. This Letter is governed by the laws of the State of New York.

 

		15.	General Provisions

 

		15.1	Effect on Other Agreements. This Letter is the entire agreement between you and the Company
with respect to the relationship contemplated by this Letter and supersedes any earlier agreement, written or oral, with respect
to the subject matter of this Letter. In entering into this Letter, no party has relied on or made any representation, warranty,
inducement, promise or understanding that is not in this Letter.

 

		15.2	Withholding. You and the Group will treat all payments to you under this Letter as compensation
for services. Accordingly, the Group may withhold from any payment any taxes that are required to be withheld under any law, rule
or regulation.

 

		15.3	No Mitigation. You do not need to seek other employment or take any other action to mitigate
any amounts owed to you under this Letter, and those amounts will not be reduced if you do obtain other employment.

 

		15.4	Survival. Upon any termination of your employment with the Group or of this Letter, this
Letter will continue in full force and effect as is necessary or appropriate to enforce the covenants and agreements in Sections
8 and 11.

 

		15.5	Notices. All notices, requests, demands and other communications under this Letter must
be in writing and will deemed given (i) on the business day sent, when delivered by hand or facsimile transmission (with confirmation)
during normal business hours, (ii) on the business day after the business day sent, if delivered by a nationally recognized overnight
courier or facsimile transmission (with confirmation) outside normal business hours or (iii) on the third business day after the
business day sent if delivered by registered or certified mail, return receipt requested, in each case to the following address
or number (or to such other addresses or numbers as may be specified by notice that conforms to this Section 15.5):

 

    	 	 	 

    
Lawrence Kreider
 August 3, 2015
 Page 12

    

 

If to you, then to your last
address on the payroll records of the Company unless otherwise directed in writing by you by notice that conforms to this Section
15.5.

 

If to the Company or any other
member of the Group, to:

 

Clipper Realty L.P.

4611 12th Avenue, Suite 1L

Brooklyn, New York 11219

 

Attention: Chief Executive Officer

Facsimile: (718) 438-1290

 

		15.6	Consideration. This Letter is in consideration of the mutual covenants contained in it.
You and the Group acknowledge the receipt and sufficiency of the consideration to this Letter and intend this Letter to be legally
binding.

 

		15.7	Waiver and Exercise of Rights. Any provision of this Letter may be amended or waived but
only if the amendment or waiver is in writing and signed, in the case of an amendment, by you and the Company or, in the case of
a waiver, by the party that would have benefited by the provision waived. Except as this Letter otherwise provides, no failure
or delay by you or the Company to exercise any right or remedy under this Letter will operate as a waiver, and no partial exercise
of any right or remedy will preclude any further exercise.

 

		15.8	Severability. Every term of this Letter is an independent and severable term. If any provision
of this Letter is found by any court of competent jurisdiction (or legally empowered agency) to be illegal, invalid or unenforceable
for any reason, then (i) the provision will be amended automatically to the minimum extent necessary to cure the illegality or
invalidity and permit enforcement and (ii) the remainder of this Letter will not be affected.

 

		15.9	Successors. You may not assign this Letter without the Company’s consent. Any attempt
to effect any of the preceding in violation of this Section 15.9, whether voluntary or involuntary, will be void. The Company
may assign this Letter to any of its affiliates or a successor of the Company, in which case the affiliate or successor, as applicable,
will be treated for all purposes as the Company under this Letter. If you die and any amounts become payable under this Letter,
we will pay those amounts to your estate.

 

    	 	 	 

    
Lawrence Kreider
 August 3, 2015
 Page 13

    

 

		15.10	Third Party Beneficiaries. This Letter will be binding on, inure to the benefit of and be
enforceable by the parties and their respective heirs, personal representatives, successors and assigns. In addition, Parent shall
be a third party beneficiary to all the rights of the Company set forth herein and may assert them as if it were the Company. This
Letter does not confer any rights, remedies, obligations or liabilities to any entity or person other than you, the Company and
Parent and your and the Company’s and Parent’s permitted successors and assigns, although this Letter will inure to
the benefit of the Group.

 

		15.11	Counterparts. This Letter may be executed in counterparts, each of which will constitute
an original and all of which, when taken together, will constitute one agreement.

 

 

    	 	 	 

     

    

 

THIS CONTRACT CONTAINS AN ARBITRATION
PROVISION WHICH MAY BE ENFORCED BY THE PARTIES.

 

A copy of this Letter is enclosed for your
records. Please sign the acknowledgement below, and return this Letter to me. Please do not hesitate to contact me if you have
any questions.

 

	 	Yours sincerely,
	 	 
	 	Clipper Realty L.P.
	 	 
	 	/s/ David Bistricer
	 	By:	David Bistricer
	 	Title:	Co-Chairman and Chief Executive Officer

 

Acceptance

 

I acknowledge that I have read and understood
this Letter. I accept the Position with Clipper Realty L.P., on the terms set out in this Letter and acknowledge that I have not
relied on any representations other than those set out in this Letter.

 

	Signed:
	 
	/s/ Lawrence Kreider
	Name:  Lawrence Kreider
	 
	Date: 8/1/15Exhibit 10.9

 

EXECUTION VERSION 

 

 

August 3, 2015

 

Jacob Schwimmer

4611 12th Avenue, Suite 1L

Brooklyn, New York 11219

 

		Re:	Terms of Employment

 

Dear Jacob,

 

This letter (this
“Letter”) sets forth the term of your employment with Clipper Realty L.P., a Maryland limited partnership (the
“Company”).

 

		1.	Commencement Date

 

This Letter is being entered into
in connection with the Rule 144A offering (the “Offering”) of the shares of common stock of Clipper Realty Inc.,
a Maryland corporation (“Parent”). Your employment under this Letter will begin on the date that the Offering
closes (the “Commencement Date”). In the event that the Offering is not completed prior to December 31, 2015
or your employment terminates prior to the closing of the Offering, this Letter will be null, void in its entirety and without
effect.

 

		2.	Term

 

Your employment under this Letter
will begin on the Commencement Date and will continue until either you or the Company terminates such employment. Your employment
with the Company will be for an unspecified duration and constitutes “at will” employment. Your employment may be terminated
at any time for any reason or no reason, at the option of you or the Company, subject to the obligations under this Letter. Upon
termination of your employment with the Company, at the request of the Company you will promptly resign from any officer position,
directorship or any other position in which you act as a fiduciary of or for the Company, Parent or any of their subsidiaries (collectively,
the “Group”).

 

		3.	Position and Duties

 

		3.1	Position and Reporting. You will serve the Company and Parent in the position of Chief Property
Management Officer (your “Position”). In those capacities, you will report directly to the Company’s Chief
Executive Officer. You understand, acknowledge and agree that you will be employed by the Company but will be providing services
to both the Company and, to the extent appropriate or necessary, Parent.

 

    	 	 	 

     

    

 

Jacob Schwimmer

August 3, 2015

Page 2

 

		3.2	Duties and Responsibilities. You are required to perform the duties that are customarily
associated with and appropriate to the Position, or which are delegated to you, from time to time, by the Company’s Chief
Executive Officer or the Company’s Board of Directors (the “Board”). Unless otherwise designated by the
Company’s Chief Executive Officer or the Board, you will primarily perform such duties at the Company’s office in Brooklyn,
New York (your “Primary Work Site”), subject to required travel where appropriate to execute such duties and
such other terms and conditions provided in this Letter.

 

		3.3	Performance. You will devote an amount of your business time and attention which is sufficient
to carry out your duties and responsibilities to the Group and will use good faith efforts to discharge your responsibilities under
this Letter to the best of your ability. Unless you have the Company’s written consent, you may not: (i) engage in any
activities, including but not limited to directorships or personal business activities, where a conflict might arise as between
those activities and the Group’s interests; or (ii) perform any other work which interferes with your ability to perform
your duties for the Group, whether or not a conflict of interest might arise as between that other work and the Group’s interests.
You also understand, acknowledge and agree that you will comply with the Investment Policy while you are employed by the Company.

 

Notwithstanding
the foregoing, the Company acknowledges that, in addition to your services pursuant to this Letter, you will provide services to
Clipper Equity and other entities and businesses affiliated with David Bistricer (the “Affiliated Entities”).
The Company understands that your responsibilities to the Affiliated Entities will preclude you from devoting substantially all
of your time and attention to the Group’s affairs. In addition, there may be certain potential conflicts of interest and
fiduciary duty issues associated with your multiple roles at the Group and the Affiliated Entities. The Company recognizes and
agrees that none of (i) your multiple responsibilities at the Group and the Affiliated Entities, (ii) your inability
to devote substantially all of your time and attention to the Group’s affairs, (iii) the actual or potential conflicts
of interest and fiduciary duty issues or (iv) any actions taken, or omitted to be taken, by you in good faith to comply with
your duties and responsibilities to the Group in light of your multiple responsibilities to the Group and the Affiliated Entities,
will be deemed to be a breach by you of your obligations under this Letter, nor will any of the foregoing constitute “Cause”
as such term is defined in Section 9.1.

 

		4.	Compensation

 

		4.1	Salary. Your annual base salary is $200,000 (as may be increased or decreased from time
to time, your “Salary”), payable in accordance with the Company’s normal practices for senior executives.
The Compensation Committee of the Board will review your Salary at least annually and may increase it at any time for any reason.
However, your Salary may not be decreased at any time (including after any increase) other than as part of an across-the-board
salary reduction that applies in the same manner to all senior executives, and any increase in your Salary will not reduce or limit
any other obligation to you under this Letter.

 

    	 	 	 

     

    

 

Jacob Schwimmer

August 3, 2015

Page 3

 

		4.2	Future Annual Cash Bonus. Beginning with the calendar year ending December 31, 2015, you
will be entitled to earn an annual cash incentive bonus (your “Bonus”) for each calendar year of the Company
ending during your employment (for the avoidance of doubt, your Bonus for 2015 will not be subject to proration). Your target Bonus
opportunity will be 75% of your Salary (e.g., $150,000 for 2015), and your actual Bonus will range from 0% to 100% of your target
bonus opportunity based on actual performance against performance metrics established by the Compensation Committee of the Board
and be paid within two and one half months after the end of the calendar year to which it relates. The Compensation Committee of
the Board, in its sole discretion, will establish the specific performance targets for each calendar year. Your Bonus will be subject
to the terms of the Group plan under which it is awarded (including applicable performance metrics and any deferral requirements)
and any Group clawback or recoupment policy in effect from time to time. You expressly agree to comply with any such policy in
all regards.

 

		4.3	Equity Awards. You will be granted, in connection with the Offering, a one-time award of
restricted LTIP units with a value of $630,000 (the “144A Grant”), based on the Offering price of $13.50
per share. The 144A Grant will be granted on or as soon as practicable following the closing of the Offering and will cliff vest
on the third anniversary of the grant date. Your 144A Grant will be subject to the terms of the Parent equity plan under which
it is granted and to the terms of the applicable award agreement.

 

Beginning in 2016
and for any future calendar years during your employment, you will be eligible to receive a long-term incentive award (“LTI
Award”) in form, including vesting restrictions, and amount determined in the sole discretion of the Board (or the Compensation
Committee of the Board). Your LTI Awards, including the LTI Award granted in 2016, will be subject to the terms of the Parent equity
plan under which it is granted and the applicable award agreement.

 

		5.	Benefits

 

During your employment, you will
be entitled to participate in each of the Group’s employee benefit and welfare plans, including plans providing retirement
benefits or medical, dental, hospitalization, life or disability insurance, on a basis that is at least as favorable as that generally
provided to other senior executives of the Group. You will be entitled to paid time off and other types of leave on a basis that
is at least as favorable as that provided to other senior executives of the Group. You will be reimbursed for all reasonable business
and entertainment expenses incurred by you in performing your responsibilities under this Letter that are submitted in accordance
with the Group’s policy.

 

    	 	 	 

     

    

 

Jacob Schwimmer

August 3, 2015

Page 4

 

		6.	Indemnification and Advancement of Expenses

 

To the extent permitted by law and
subject to the Parent’s articles of incorporation and bylaws, the Company will indemnify you against any actual or threatened
action, suit or proceeding against you, whether civil, criminal, administrative or investigative, arising by reason of your status
as a director, officer, employee and/or agent of the Group during your employment. In addition, to the extent permitted by law
and subject to the Parent’s articles of incorporation and bylaws, the Company will advance or reimburse any expenses, including
reasonable attorney’s fees, you incur in investigating and defending any actual or threatened action, suit or proceeding
for which you may be entitled to indemnification under this Section 6. However, you agree to repay any expenses paid
or reimbursed by the Company if it is ultimately determined that you are not legally entitled to be indemnified by the Company.

 

		7.	Company Property

 

		7.1	All material, including but not limited to written material whether in hard copy or electronic
format, created by you or which comes into your possession or control in the course of your employment with the Group, is the property
of the Group.

 

		7.2	When your employment with the Company ends, or when otherwise directed by the Company, you must
return all of the Group’s property in your possession or control including, but not limited to, all material (whether written
material in hard copy or electronic format), keys, access cards, vehicles owned or leased by the Group, phones, computers or discs.
When directed by the Company, instead of returning such property to the Group, you must destroy it and certify in writing to the
Company that you have done so.

 

		7.3	You agree that any intellectual property created or developed by you (whether by yourself or with
others) in the course of your employment with the Group will belong exclusively to the Group. By signing this Letter you: (i) assign
to the Group all rights in any intellectual property (including all rights of copyright and patent) created or developed by you
(whether by yourself or with others) in the course of your employment, including the right to develop, make, use, sell, license
or otherwise benefit from the intellectual property; and (ii) agree to execute any documents necessary or desirable to give effect
to your obligations in this Section 7.3.

 

		7.4	You consent to the Group doing or omitting to do anything that would otherwise infringe your rights
in any copyright works created or developed by you (whether alone or with others) in the course of your employment with the Company.

 

		8.	Confidential Information

 

		8.1	You agree that during your employment with the Company, and after your employment with the Company
ends, you must not use or disclose to any person any Proprietary Information which you acquire during your employment with the
Company, except if that use or disclosure is in the proper course of your employment for the Group’s benefit, with the Company’s
written consent, or as required by law. You agree that during your employment you will use your best endeavors to maintain proper
and secure custody of any Proprietary Information and to prevent the publication, use or disclosure of any Proprietary Information,
including by a third party.

 

    	 	 	 

     

    

 

Jacob Schwimmer

August 3, 2015

Page 5

 

“Proprietary Information”
means confidential or proprietary information, knowledge or data concerning (i) the Group’s businesses, strategies, operations,
financial affairs, organizational matters, personnel matters, budgets, business plans, marketing plans, studies, policies, procedures,
products, ideas, processes, software systems, trade secrets and technical know-how, (ii) any other matters relating to the Group
and (iii) any matter relating to clients of the Group or other third parties having relationships with the Group. Proprietary Information
includes (i) information regarding any aspect of your tenure as an employee of the Group or the termination of your employment,
(ii) the names, addresses, and phone numbers and other information concerning clients and prospective clients of the Group, (iii)
investment techniques and trading strategies used in, and the performance records of, client accounts or other investment products,
and (iv) information and materials concerning the personal affairs of employees of the Group. In addition, Proprietary Information
may include information furnished to you orally or in writing (whatever the form or storage medium) or gathered by inspection,
in each case before or after the date of this Letter.

 

		8.2	These obligations do not apply to Proprietary Information which is publicly available, unless that
information is publicly available because you have, directly or indirectly, breached any of your obligations with respect to that
information. If it is uncertain whether any information is publicly available, the information is deemed not to be publicly available,
unless the Company informs you in writing to the contrary.

 

		8.3	Nothing in this Letter prohibits you from providing truthful testimony concerning the Group to
governmental, regulatory or self-regulatory authorities, including your right to make disclosures under the whistleblower provisions
of federal law or regulation, so long as you give the Company written notice of such testimony (if legally permitted) as soon as
practicable under the circumstances to enable the Group to seek a protective order, confidential treatment or other appropriate
relief and cooperate with the Group in seeking to do so.

 

		9.	Termination of Employment

 

		9.1	Related Definitions.

 

		(a)	“Cause” means the occurrence of any of the following: (i) your conviction of,
or plea of guilty or no contest to, any felony or any crime involving fraud or moral turpitude under the laws of the United States
or any state thereof or under the laws of any other jurisdiction; (ii) your engagement in gross misconduct that causes material
financial or reputational harm to the Group; (iii) your material violation of this Letter or any written Company policy (including,
but not limited to, the Investment Policy) or (iv) your disqualification or bar by any governmental or self-regulatory authority
from serving in the capacity required by your job description or your loss of any governmental or self-regulatory license that
is reasonably necessary for you to perform your duties or responsibilities, in each case as an employee of the Group. The Group
may place you on unpaid leave for up to 60 consecutive days while it is determining whether there is a basis to terminate your
employment for Cause.

 

    	 	 	 

     

    

 

Jacob Schwimmer

August 3, 2015

Page 6

 

		(b)	“Disability” will have the meaning provided in the Group’s disability
policy, as may be amended from time to time.

 

		9.2	Without Cause. If the Company terminates your employment without Cause, subject to Section 9.5,
the only further obligations the Group will have to you are:

 

		(a)	The Company will:

 

		(i)	within 30 days of your termination, pay you (A) your unpaid Salary; (B) your Salary for any accrued but unused paid
time off; and (C) reimbursement of any business expenses submitted in accordance with the Group’s policy; and

 

		(ii)	provide to you, in accordance with the then-existing employee benefit plans, policies and practices of the Group, all other
accrued and vested benefits

 

((i) and (ii) together,
your “Accrued Compensation”).

 

		(b)	The Company will pay you your Earned Bonus, as hereinafter defined, at the time such Earned Bonus
would otherwise have been paid had your employment not ended. Your “Earned Bonus” means any earned but unpaid
Bonus for any calendar year ending before the end of your employment and, to the extent it has not been determined before the end
of your employment, determined based on actual performance consistent with this Letter and the Group plan under which it was awarded.

 

		(c)	The Company will pay you your Prorated Bonus, as hereinafter defined, at the time such Prorated
Bonus would otherwise have been paid had your employment not ended. Your “Prorated Bonus” means the Bonus for
the calendar year in which your termination occurs based on the actual performance of the Company consistent with this Letter and
the Group plan under which it was awarded, and prorated for the number of days you worked for the Company during such year.

 

		(d)	The Company will pay you cash severance under, and pursuant to the terms of, the Company’s
general severance plan or policy as in effect on your termination date (the “Severance Payment”).

 

    	 	 	 

     

    

 

Jacob Schwimmer

August 3, 2015

Page 7

 

		(e)	The Company will, at the Company’s election, either (i) continue to provide to you benefits
under the Company’s group health insurance, vision and dental plans at the level provided to you immediately prior to your
termination date through the 12-month anniversary date of such termination date, at which time you may be eligible to elect to
continue health care and dental coverage under COBRA, or (ii) pay you a lump-sum cash payment equal to 12 times the monthly
COBRA cost of continued health and medical coverage for you and, as applicable, your covered spouse and/or dependents at the level
provided to you immediately prior your termination date, with such payment grossed up for applicable taxes.

 

		(f)	Any outstanding LTI Awards and the 144A Grant will continue to vest on the vesting date(s) specified
in the applicable award agreement, as if you had remained employed through such date(s), subject to your continued compliance with
the restrictive covenants contained in Sections 8 and 11 of this Letter and in any other agreement with the Group.

 

		9.3	For Cause or Resignation for Any Reason. If the Company terminates your employment for Cause
or you terminate your employment for any reason, the Company will pay you your Accrued Compensation. The Group will have no further
obligations to you, and you will forfeit your Earned Bonus, Prorated Bonus, and any unvested portion of your LTI Awards and 144A
Grant.

 

		9.4	Death or Disability. If your employment terminates as a result of your death or Disability,
the only further obligations the Group will have to you are: (i) the Company will pay you your Accrued Compensation, your
Earned Bonus and your Prorated Bonus, and (ii) your LTI Awards and 144A Grant will vest in accordance with the terms of the applicable
award agreement, subject to your continued compliance with the restrictive covenants contained in Sections 8 and 11
of this Letter and in any other agreement with the Group.

 

		9.5	Release. Notwithstanding anything to the contrary, the Company will not be required to make
the payments and provide the benefits in Sections 9.2 (other than the Accrued Compensation) unless you execute and deliver
to the Company an agreement releasing from all liability each member of the Group and any of their respective past or present officers,
directors, employees or agents (the “Release”). For the avoidance of doubt, the parties acknowledge that your
right to elect COBRA coverage is not subject to your execution of a Release. The Release will be in the form normally used by the
Company for senior executives at the time and will be provided to you no later than two days after your separation from service,
and must be executed by you and become effective (i.e., the period for revocation must have expired) and not be revoked by you
by the 55th day following your separation of service (the period following your termination until the Release becomes effective,
the “Release Period”). Any payments or benefits that would have been paid or provided to you during the Release
Period will be paid or provided on the next regularly scheduled Company payroll date following the Release Period.

 

		9.6	If you violate any of the restrictive covenants contained in Sections 8 and 11 of
this Letter, you will (i) forfeit any LTI Awards and the 144A Grant to the extent that they have not vested at the time of
such violation and (ii) forfeit any unpaid Severance Payment. Nothing in this Section 9.6 will be construed as prohibiting
the Company from pursuing any other remedies available to it in the event of a violation of Sections 8 or 11.

 

    	 	 	 

     

    

 

Jacob Schwimmer

August 3, 2015

Page 8

 

		10.	Deductions

 

Either during your employment or
when your employment with the Company ends, you authorize the Group to deduct any amount of money that you owe the Group from any
amount of money the Group owes you.

 

		11.	Post-Employment Obligations

 

		11.1	Non-Competition and Non-Solicitation. You agree that during your employment with the Group
and for a period of 12 months from the date your employment with the Group ends for any reason, you must not, without
the Company’s prior written consent (a) engage in a Competitive Enterprise or (b) directly or indirectly (including via a
corporate entity) Solicit or entice, or endeavor to Solicit or entice, from the Group any officer or employee of the Group with
whom you have had direct or indirect contact or dealings, or knowledge of, during the 12 months prior to your termination date.

 

		11.2	Related Definitions.

 

		(a)	“Competitive Enterprise” means any (i) multi-family or commercial property
located in the metropolitan New York City area or (ii) business enterprise that holds a 25% or greater equity, voting or profit
participation interest in any such property; provided that a Competitive Enterprise will not include (1) any “Excluded
Assets” (as defined in the Investment Policy) or (2) any investment opportunity which has been offered to the Company
and the Board (or an independent committee of the Board), and either (A) such offeree has determined that the Company will not
pursue such investment opportunity or (B) such offeree has not responded to indicate that the Company shall pursue such investment
opportunity within 30 days after such offer was made.

 

		(b)	“Solicit” means any direct or indirect communication, regardless of who initiates
it, that in any way invites, advises, encourages or requests any person to take or refrain from taking any action.

 

		11.3	Notice to New Employers. Before you either apply for or accept employment with any other
person or entity while Section 11.1 is in effect, you will provide the prospective employer with written notice of
the provisions of this Section 11 and will deliver a copy of the notice to the Company.

 

		11.4	Future Cooperation. You agree that, upon the Company’s reasonable request following
your termination of employment, you will use reasonable best efforts to assist and cooperate with the Company in connection with
the defense or prosecution of any claim that may be made against or by the Group arising out of events occurring during your employment,
or in connection with any ongoing or future investigation or dispute or claim of any kind involving the Group, including any proceeding
before any arbitral, administrative, regulatory, self-regulatory, judicial, legislative, or other body or agency. You will be entitled
to reimbursement for reasonable out-of-pocket expenses (including travel expenses) incurred in connection with providing such assistance.

 

    	 	 	 

     

    

 

Jacob Schwimmer

August 3, 2015

Page 9

 

		11.5	Non-Disparagement. You agree that you will not at any time publicly disparage or encourage
or induce others to publicly disparage the Group (or any of its employees, officers, directors, shareholders, owners, representatives,
independent contractors, agents, businesses or services) and/or engage in any conduct that is in any way injurious to the reputation
or interests of the Group, including without limitation, any negative or derogatory statements or writings.

 

		11.6	Your Importance to the Group and the Effect of this Section 11. You acknowledge that:

 

		(a)	In the course of your involvement in the Group’s activities, you will have access to Proprietary
Information and the Group’s client base and will profit from the goodwill associated with the Group. In light of your access
to Proprietary Information and your importance to the Group, if you compete with the Group for some time after your employment,
the Group will likely suffer significant harm. In return for the benefits you will receive from the Group and to induce the Group
to enter into this Letter, and in light of the potential harm you could cause the Group, you agree to the provisions of this Section
11. The Company would not have entered into this Letter if you did not agree to this Section 11.

 

		(b)	This Section 11 limits your ability to earn a livelihood in a Competitive Enterprise and your relationships with clients.
You acknowledge, however, that complying with this Section 11 will not result in severe economic hardship for you or your
family.

 

		12.	Effect of 280G Excise Tax

 

		12.1	In the event that the payments and other benefits provided for in this Letter or otherwise payable
to you (collectively, “Benefits”) (i) constitute “parachute payments” within the meaning of Section
280G of the Internal Revenue Code of 1986 (the “Code”) and (ii) but for this Section 12.1, would be subject
to the excise tax imposed by Section 4999 of the Code, then your Benefits will be either:

 

		(a)	delivered in full, or

 

		(b)	delivered as to such lesser extent which would result in no portion of such Benefits being subject
to the excise tax under Section 4999 of the Code,

 

whichever of the foregoing amounts,
taking into account the applicable federal, state and local income taxes and the excise tax imposed by Section 4999 of the Code,
results in the receipt by you, on an after-tax basis, of the greatest amount of Benefits. The Benefits to be reduced under this
Section 12.1 will be determined in a manner which has the least economic cost to you and, to the extent the economic cost
is equivalent, will be reduced in the inverse order of when the Benefits would have been made to you.

 

		12.2	The determinations to be made with respect to Section 12.1 will be made by a certified public
accounting firm (the “Accountant”) designated
by the Company. As part of such determinations, the Accountant will conduct a valuation of any restrictions on your ability to
compete. The Company will be responsible for all charges of the Accountant.

 

    	 	 	 

     

    

 

Jacob Schwimmer

August 3, 2015

Page 10

 

		13.	Section 409A

 

		13.1	This Letter is intended to comply with Section 409A of the Code (“Section 409A”)
to the extent it is subject thereto, and the Letter will be interpreted on a basis consistent with such intent. If and to the extent
that any payment or benefit under this Letter, or any plan, award agreement or arrangement of the Group, constitutes “non-qualified
deferred compensation” subject to Section 409A, such payments and benefits may only be made or satisfied under this Letter
upon an event and in a manner permitted by Section 409A. Each payment of compensation under this Letter will be treated as a separate
payment of compensation for purposes of Section 409A to the extent Section 409A applies to such payments.

 

		13.2	Notwithstanding anything in this Letter to the contrary, if you are considered a “specified
employee” for purposes of Section 409A, (i) if payment of any amounts under this Letter is required to be delayed for a period
of six months after separation from service pursuant to Section 409A, payment of such amounts will be delayed as required by Section
409A and will, subject to Section 9.5, be paid in a lump sum payment within fifteen days after the end of the six-month
period and (ii) in the event any equity-based awards held by you that vest upon termination of your employment constitute “non-qualified
deferred compensation” subject to Section 409A, the delivery of shares or cash (as applicable) in settlement of such awards
will be made on the earliest permissible payment date (including the date that is six months after separation from service pursuant
to Section 409A) or event under Section 409A on which the shares or cash would otherwise be delivered or paid. If you die during
the postponement period prior to the payment of any amounts or benefits or delivery of shares, the amounts and entitlements delayed
on account of Section 409A will be paid or provided to the personal representative of your estate within 60 days after the date
of your death.

 

		13.3	All payments to be made upon a termination of employment under this Letter that constitute “non-qualified
deferred compensation” subject to Section 409A may only be made upon a “separation from service” under Section
409A. In no event may you, directly or indirectly, designate the calendar year of a payment. All reimbursements and in-kind benefits
provided under this Letter will be made or provided in accordance with the requirements of Section 409A, including, where applicable,
the requirement that (i) the amount of expenses eligible for reimbursement, or in-kind benefits provided, during a calendar year
may not affect the expenses eligible for reimbursement, or in-kind benefits to be provided, in any other calendar year; (ii) the
reimbursement of an eligible expense will be made no later than the last day of the calendar year following the year in which the
expense is incurred; and (iii) the right to reimbursement or in-kind benefits is not subject to liquidation or exchange for another
benefit.

 

    	 	 	 

     

    

 

Jacob Schwimmer

August 3, 2015

Page 11

 

		14.	Dispute Resolution

 

		14.1	Mandatory Arbitration. Subject to the provisions of this Section 14, any dispute
involving your employment or this Letter will be finally settled by binding arbitration in the County of Manhattan administered
by the American Arbitration Association, the FINRA, JAMS/Endispute, or any other similar association mutually agreed to by the
Company and you. The award of the arbitrators will be final and binding and judgment upon the award may be entered in any court
having jurisdiction thereof. This procedure will be the exclusive means of settling any disputes that may arise under this Letter.
Each party will bear its own attorney’s fees and legal expenses and will share equally the fees and expenses of the arbitration;
provided that if you prevail on any material issue (as determined by the arbitrators), the Company will reimburse you for reasonable
attorney’s fees and legal expenses incurred in connection with such claim.

 

		14.2	Injunctions and Enforcement of Arbitration Awards. You or the Group may bring an action
or special proceeding in a state or federal court of competent jurisdiction sitting in the County of Manhattan to enforce any arbitration
award under Section 14.1. Also, the Group may bring such an action or proceeding, in addition to its rights under Section 14.1
and whether or not an arbitration proceeding has been or is ever initiated, to temporarily, preliminarily or permanently enforce
any part of Sections 8 and 11. You agree that (i) your violating any part of Sections 8 and 11
would cause damage to the Group that cannot be measured or repaired, (ii) the Group therefore is entitled to an injunction, restraining
order or other equitable relief restraining any actual or threatened violation of those Sections, (iii) no bond will need to be
posted for the Group to receive such an injunction, order or other relief, (iv) no proof will be required that monetary damages
for violations of those Sections would be difficult to calculate and that remedies at law would be inadequate and (v) that the
General Counsel of the Company is irrevocably appointed as your agent for service of process in connection with any such action
or proceeding (the General Counsel will promptly advise you of any such service of process).

 

		14.3	Waiver of Jury Trial. To the extent permitted by law, you and the Group waive any and all
rights to a jury trial with respect to any dispute involving your employment or this Letter.

 

		14.4	Governing Law. This Letter is governed by the laws of the State of New York.

 

		15.	General Provisions

 

		15.1	Effect on Other Agreements. This Letter is the entire agreement between you and the Company
with respect to the relationship contemplated by this Letter and supersedes any earlier agreement, written or oral, with respect
to the subject matter of this Letter. In entering into this Letter, no party has relied on or made any representation, warranty,
inducement, promise or understanding that is not in this Letter.

 

		15.2	Withholding. You and the Group will treat all payments to you under this Letter as compensation
for services. Accordingly, the Group may withhold from any payment any taxes that are required to be withheld under any law, rule
or regulation.

 

    	 	 	 

     

    

 

Jacob Schwimmer

August 3, 2015

Page 12

 

		15.3	No Mitigation. You do not need to seek other employment or take any other action to mitigate
any amounts owed to you under this Letter, and those amounts will not be reduced if you do obtain other employment.

 

		15.4	Survival. Upon any termination of your employment with the Group or of this Letter, this
Letter will continue in full force and effect as is necessary or appropriate to enforce the covenants and agreements in Sections
8 and 11.

 

		15.5	Notices. All notices, requests, demands and other communications under this Letter must
be in writing and will deemed given (i) on the business day sent, when delivered by hand or facsimile transmission (with confirmation)
during normal business hours, (ii) on the business day after the business day sent, if delivered by a nationally recognized overnight
courier or facsimile transmission (with confirmation) outside normal business hours or (iii) on the third business day after the
business day sent if delivered by registered or certified mail, return receipt requested, in each case to the following address
or number (or to such other addresses or numbers as may be specified by notice that conforms to this Section 15.5):

 

If to you, then to your last address
on the payroll records of the Company unless otherwise directed in writing by you by notice that conforms to this Section 15.5.

 

If to the Company or any other member
of the Group, to:

 

Clipper Realty L.P.

4611 12th Avenue, Suite 1L

Brooklyn, New York 11219

 

Attention: Chief Executive Officer

Facsimile: (718) 438-1290

 

		15.6	Consideration. This Letter is in consideration of the mutual covenants contained in it.
You and the Group acknowledge the receipt and sufficiency of the consideration to this Letter and intend this Letter to be legally
binding.

 

		15.7	Waiver and Exercise of Rights. Any provision of this Letter may be amended or waived but
only if the amendment or waiver is in writing and signed, in the case of an amendment, by you and the Company or, in the case of
a waiver, by the party that would have benefited by the provision waived. Except as this Letter otherwise provides, no failure
or delay by you or the Company to exercise any right or remedy under this Letter will operate as a waiver, and no partial exercise
of any right or remedy will preclude any further exercise.

 

		15.8	Severability. Every term of this Letter is an independent and severable term. If any provision
of this Letter is found by any court of competent jurisdiction (or legally empowered agency) to be illegal, invalid or unenforceable
for any reason, then (i) the provision will be amended automatically to the minimum extent necessary to cure the illegality or
invalidity and permit enforcement and (ii) the remainder of this Letter will not be affected.

 

    	 	 	 

     

    

 

Jacob Schwimmer

August 3, 2015

Page 13

 

		15.9	Successors. You may not assign this Letter without the Company’s consent. Any attempt
to effect any of the preceding in violation of this Section 15.9, whether voluntary or involuntary, will be void. The Company
may assign this Letter to any of its affiliates or a successor of the Company, in which case the affiliate or successor, as applicable,
will be treated for all purposes as the Company under this Letter. If you die and any amounts become payable under this Letter,
we will pay those amounts to your estate.

 

		15.10	Third Party Beneficiaries. This Letter will be binding on, inure to the benefit of and be
enforceable by the parties and their respective heirs, personal representatives, successors and assigns. In addition, Parent shall
be a third party beneficiary to all the rights of the Company set forth herein and may assert them as if it were the Company. This
Letter does not confer any rights, remedies, obligations or liabilities to any entity or person other than you, the Company and
Parent and your and the Company’s and Parent’s permitted successors and assigns, although this Letter will inure to
the benefit of the Group.

 

		15.11	Counterparts. This Letter may be executed in counterparts, each of which will constitute
an original and all of which, when taken together, will constitute one agreement.

 

    	 	 	 

     

    

 

THIS CONTRACT CONTAINS AN ARBITRATION PROVISION
WHICH MAY BE ENFORCED BY THE PARTIES.

 

A copy of this Letter is enclosed for your
records. Please sign the acknowledgement below, and return this Letter to me. Please do not hesitate to contact me if you have
any questions.

 

	 	Yours sincerely,
	 	 
	 	Clipper Realty L.P.
	 	 
	 	/s/ David Bistricer
	 	By:     David Bistricer
	 	Title:  Co-Chairman and Chief Executive Officer

 

Acceptance

 

I acknowledge that I have read and understood
this Letter. I accept the Position with Clipper Realty L.P., on the terms set out in this Letter and acknowledge that I have not
relied on any representations other than those set out in this Letter.

 

	Signed:	 
	 	 
	/s/ Jacob Schwimmer	 
	Name:  Jacob Schwimmer	 
	 	 
	Date: 8/1/15

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