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EXHIBIT 10.1

FORM OF SEVERANCE AGREEMENT

1.    Recitals

      (a) This Severance Agreement ("Agreement") is between The Town and Country
Trust (the "Company") and ____________ (the "Executive") and is effective as of
January ___, 2005.

      (b) The address of the Company is 300 East Lombard Street, Baltimore,
Maryland 21202. The address of the Executive is_______________________________.

      (c) The Executive is currently employed by the Company in the capacity of
___________________ and the Executive is one of the key executives of the
Company.

      (d) In consideration of the mutual promises contained herein and other
good and valuable consideration, the Executive and the Company have entered into
this Agreement.

2.    Term of Agreement

      The Term of this Agreement shall commence on the date hereof and continue
until December 31, 2007; provided, however, that commencing on January 1, 2006
and each January 1st thereafter, the above-referenced date and the Term of this
Agreement shall automatically be extended for one additional year unless at
least thirty days prior to such January 1st date, the Company or the Executive
shall have given notice that it or he does not wish to extend this Agreement;
and further provided, however, that if a Change in Control (as defined in
Section 3 hereof) shall have occurred during the Term of this Agreement, the
Term of this Agreement shall expire no earlier than twenty-four (24) months
following the month in which such Change in Control occurred. The phrase "Term
of this Agreement" shall refer to the period commencing on the date hereof and
ending on December 31, 2007 (or any extension thereof pursuant to the preceding
sentence).

      Nothing contained in this Agreement shall prevent the Company at any time
from terminating the Executive's right and obligation to perform services for
the Company or prevent the Company from removing the Executive from any position
which the Executive holds in the Company, subject to the obligation of the
Company to make payments and provide benefits if and to the extent required
under this Agreement, which payments and benefits shall be full and complete
liquidated damages, insofar as the obligations of the Company pursuant to this
Agreement are concerned, for any such action taken by the Company. The Executive
specifically acknowledges that, except for this Agreement, his employment by the
Company is employment-at-will, subject to termination by the Executive, or by
the Company, at any time with or without cause. The Executive acknowledges that
such employment-at-will status cannot be modified except in a specific writing
which has been authorized or ratified by the Board of Directors of the Company
(the "Board").

3.    Change in Control

      (a) No benefit shall be payable under this Agreement unless a Change in
Control of the Company shall be deemed to have occurred. For purposes of this
Agreement, a "Change in Control" of the Company shall be deemed to have occurred
if:

            (i)   any Person (as defined in Section 3(b) hereof) is or becomes
                  the beneficial owner (as set forth in Rule 13d-3 under the
                  Securities Exchange Act of 1934, as amended ("Exchange Act"))
                  ("Beneficial Owner"), directly or indirectly, of securities of
                  the Company (not including in the securities beneficially
                  owned by such Person any securities acquired directly from the
                  Company or its affiliates (as set forth in Rule 12b-2
                  promulgated under Section 12 of the Exchange Act)
                  ("Affiliates")) representing 25% or more of the

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                  combined voting power of the Company's then outstanding
                  securities, excluding any Person who becomes such a Beneficial
                  Owner in connection with a transaction described in clause (B)
                  of paragraph (iii) below; or

            (ii)  the following individuals cease for any reason to constitute a
                  majority of the number of directors then serving: individuals
                  who, on the date hereof, constitute the Board and any new
                  director (other than a director whose initial assumption of
                  office is in connection with an actual or threatened election
                  contest, including but not limited to a consent solicitation,
                  relating to the election of directors of the Company) whose
                  appointment or election by the Board or nomination for
                  election by the Company's shareholders was approved or
                  recommended by a vote of at least two-thirds (2/3) of the
                  directors then still in office who either were directors on
                  the date hereof or whose appointment, election or nomination
                  for election was previously so approved or recommended; or

            (iii) there is consummated a merger or consolidation of the Company
                  or any direct or indirect subsidiary of the Company with any
                  other corporation or other entity, other than (A) a merger or
                  consolidation effected to implement a recapitalization of the
                  Company (or similar transaction) in which no Person is or
                  becomes the Beneficial Owner, directly or indirectly, of
                  securities of the Company (not including in the securities
                  Beneficially Owned by such Person any securities acquired
                  directly from the Company or its Affiliates) representing 25%
                  or more of the combined voting power of the Company's then
                  outstanding securities, or (B) a merger or consolidation which
                  results in (1) the voting securities of the Company
                  outstanding immediately prior to such merger or consolidation
                  continuing to represent (either by remaining outstanding or by
                  being converted into voting securities of the surviving entity
                  or any parent thereof) at least 55% of the combined voting
                  power of the securities of the Company or such surviving
                  entity or any parent thereof outstanding immediately after
                  such merger or consolidation and (2) the individuals who
                  comprise the Board immediately prior to the merger or ---
                  consolidation constitute at least a majority of the board of
                  directors of the Company, the entity surviving such merger or
                  consolidation or, if the Company or the entity surviving such
                  merger is then a subsidiary, the ultimate parent thereof; or

            (iv)  the shareholders of the Company approve a plan of complete
                  liquidation or dissolution of the Company or there is
                  consummated an agreement for the sale or disposition by the
                  Company of all or substantially all of the Company's assets,
                  other than a sale or disposition by the Company of all or
                  substantially all of the Company's assets to an entity where
                  (A) at least 55% of the combined voting power of the voting
                  securities of which are owned by shareholders of the Company
                  in substantially the same proportions as their ownership of
                  the Company immediately prior to such sale and (B) immediately
                  following such sale the individuals who comprise the Board
                  immediately prior thereto constitute at least a majority of
                  the board of directors of the entity to which such assets are
                  sold or disposed or any parent thereof; or

            (v)   a transaction is consummated following which the Company
                  ceases to be the Beneficial Owner, directly or indirectly, of
                  the majority of the partnership interests in the TC Operating
                  Limited Partnership (the "OP").

Notwithstanding the foregoing, any event or transaction which would otherwise
constitute a Change in Control (a "Transaction") shall not constitute a Change
in Control for purposes of this Agreement if, in connection with the
Transaction, the Executive participates as an equity investor in the acquiring
entity or any of its affiliates (the "Acquiror"). For purposes of the preceding
sentence, the Executive shall not be deemed to have participated as an equity
investor in the Acquiror by virtue of (i) obtaining beneficial ownership of any
equity interest in the Acquiror as a result of the grant to the Executive of an
incentive compensation award under one or more incentive plans of the Acquiror
(including, but not limited to, the conversion in connection with the
Transaction of incentive compensation awards of the Company into incentive
compensation awards of the Acquiror), on terms and conditions substantially
equivalent to those applicable to other executives of the Company immediately
prior to the Transaction, after taking

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into account normal differences attributable to job responsibilities, title and
the like, or (ii) obtaining beneficial ownership of any equity interest in the
Acquiror on terms and conditions substantially equivalent to those obtained in
the Transaction by all other stockholders of the Company or all other holders of
interests in the OP.

      (b) Person shall have the meaning given in Section 3(a)(9) of the Exchange
Act and used in Sections 13(d) and 14(d) thereof, except that such term shall
not include (i) the Company or any of its Affiliates, (ii) a trustee or other
fiduciary holding securities under an employee benefit plan of the Company or
any of its Affiliates, (iii) an underwriter temporarily holding securities
pursuant to an offering of such securities, (iv) a corporation owned, directly
or indirectly, by the shareholders of the Company in substantially the same
proportions as their ownership of stock of the Company, (v) Harvey Schulweis,
individually, or his estate, heirs or personal representatives or any trust
created for the benefit of his wife or children, or any corporation or other
entity which such persons control, or (vi) the estate of Alfred Lerner, his
heirs or personal representatives or any trust created for the benefit of his
wife or children, or any corporation or other entity which such persons control.

      (c) For purposes of this Agreement, the Executive's employment shall be
deemed to have been terminated following a Change in Control by the Company
without Cause or by the Executive for Good Reason, if (i) the Executive's
employment is terminated by the Company without Cause prior to a Change in
Control (whether or not a Change in Control ever occurs) and such termination
was at the request or direction of a Person with whom, at the time of
termination of the Executive's employment, the Company was actively engaged in
negotiations or other activities for the purpose of effecting a Change in
Control, or (ii) the Executive terminates his employment for Good Reason prior
to a Change in Control (whether or not a Change in Control ever occurs) and the
circumstance or event which constitutes Good Reason occurs at the request or
direction of such Person.

4.    Notice of Termination; Date of Termination

      (a) Any termination of the Executive's employment by the Company or by the
Executive shall be communicated by written Notice of Termination to the other
party thereto. For purposes of this Agreement, a "Notice of Termination" shall
mean a notice that shall indicate 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 employment under the
provision so indicated. Furthermore, either the Executive or the Company may
give a Notice of Termination to the other party for the purpose of terminating
this Agreement, as such, without terminating the Executive's employment with the
Company, which Notice of Termination shall have the effect of terminating this
Agreement at the expiration of the Term of this Agreement as in effect on the
date of giving such Notice of Termination.

      (b) "Date of Termination" shall mean:

            (i)   If the Agreement is terminated for Disability (as defined in
                  Section 8 hereof), thirty (30) days after Notice of
                  Termination is given (provided that the Executive shall not
                  have returned to the performance of his duties on a full-time
                  basis during such thirty (30) day period),

            (ii)  If the Executive's employment terminates due to death, the
                  date of death,

            (iii) The expiration or termination of the Term of this Agreement,
                  and

            (iv)  If the Executive's employment is terminated for any other
                  reason, the date set forth in the applicable Notice of
                  Termination which shall not be less than 30 days after the
                  date Notice of Termination is given.

5.    Compensation After Change in Control

      Immediately after any Change in Control of the Company shall be deemed to
have occurred, the Executive shall be entitled to receive for the remainder of
the Term of this Agreement (as extended from time to time) an annual base salary
(the "Base Salary"), payable in installments in accordance with the current
practice of the

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Company, at an annual rate at least equal to the aggregate annual base salary
payable to the Executive as of the date hereof. The Base Salary may be increased
(but may not be decreased) at any time and from time to time by action of the
Board, any committee thereof, or any individual having authority to take such
action, in accordance with the Company's regular practices, and, if so
increased, such increased Base Salary shall thereafter be the Base Salary for
the purposes of this Agreement. Any increase in the Base Salary shall not serve
to limit or reduce any other obligation of the Company hereunder.

6.    Benefit Plans

      After a Change in Control of the Company shall be deemed to have occurred,

      (a) The Company agrees to continue in effect the benefit plans (including,
without limitation, any life, health, dental, short term and long term
disability insurance coverages, or retirement plans) in which the Executive was
participating or, with continued service or retirement would be eligible for
participation as of immediately prior to the Change in Control (collectively
referred to as the "Benefit Plans"); or to maintain plans providing
substantially similar benefits; and

      (b) The Company agrees not to take any action that would adversely affect
the Executive's participation in, or materially reduce the benefits under, any
of the Benefit Plans or deprive the Executive of any material fringe benefit
enjoyed by him as of immediately prior to the Change in Control.

7.    Termination for Cause

      (a) The Company may terminate the Executive's employment for Cause. For
the purposes of this Agreement, the Company shall have "Cause" to terminate
employment hereunder only (i) if termination shall have been the result of an
act or acts of dishonesty by the Executive constituting a felony or an act or
acts resulting or intended to result directly or indirectly in substantial gain
or personal enrichment to the Executive at the expense of the Company; or (ii)
upon the willful and continued failure by the Executive substantially to perform
his duties with the Company (other than any such failure resulting from
incapacity due to mental or physical illness) after a demand in writing for
substantial performance is delivered by the Board, which demand specifically
identifies the manner in which the Board believes that the Executive has not
substantially performed his duties, and such failure results in demonstrably
material injury to the Company. The Executive's employment shall in no event be
considered to have been terminated by the Company for Cause if such termination
took place as the result of (i) bad judgment or negligence, or (ii) any act or
omission without intent of gaining therefrom directly or indirectly a profit to
which the Executive was not legally entitled, or (iii) any act or omission
believed in good faith to have been in or not opposed to the interest of the
Company, or (iv) any act or omission in respect of which a determination is made
that the Executive met the applicable standard of conduct prescribed for
indemnification or reimbursement or payment of expenses under the By-Laws of the
Company or the laws of the State of Maryland, in each case as in effect at the
time of such act or omission. The Executive shall not be deemed to have been
terminated for Cause unless and until there shall have been delivered to him a
copy of a resolution duly adopted by the affirmative vote of a majority of the
entire membership of the Board at a meeting of the Board called and held for the
purpose (after reasonable notice to the Executive and an opportunity for him,
together with his counsel, to be heard before the Board), finding that in the
good faith opinion of the Board the Executive was guilty of conduct set forth
above in clauses (i) or (ii) of the first sentence of this paragraph and
specifying the particulars thereof in detail.

      (b) If the Executive's employment shall be terminated for Cause, the
Company shall pay the Executive his full Base Salary through the Date of
Termination at the rate in effect at the time Notice of Termination is given and
the Company shall have no further obligations to the Executive under this
Agreement.

8.    Disability

      For purposes of this Agreement, the Executive shall be considered to be
suffering from a "Disability" only if, as a result of his incapacity due to
physical or mental illness, he shall have been absent from his duties with the
Company on a full-time basis for a period of one year and a physician selected
by him is of the opinion that (i) he is suffering from "Total Disability" as
defined in the Company's long term disability plan, or any successor plan or

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program and (ii) he will qualify for social security disability payment and
(iii) within thirty (30) days after written Notice of Termination is given, he
shall not have returned to the full-time performance of his duties.

9.    Compensation Upon Certain Terminations

      (a) The Company shall pay to the Executive in a lump sum on the fifth
business day following the later of the Date of Termination and the expiration
of the revocation period referenced in Section 9(f) hereof, the following
amounts if during the Term of this Agreement (A) the Company shall terminate the
Executive's employment within the two-year period subsequent to a Change in
Control other than for Cause or due to death or Disability; (B) the Executive
shall terminate his employment for Good Reason (as defined in Section 9(g)
hereof) within the two-year period subsequent to a Change in Control; or (C) the
Executive voluntarily terminates his employment for any reason during the
one-month period commencing on the one-year anniversary of the Change in Control
(each, a "Qualifying Termination"):

            (i)   The Executive's Base Salary through the Date of Termination at
                  the rate in effect at the time Notice of Termination is given;

            (ii)  A pro rata portion to the Date of Termination of the aggregate
                  value of each annual cash bonus opportunity of the Executive
                  for the then uncompleted fiscal year pursuant to any annual
                  bonus or incentive program maintained by the Company,
                  calculated as to each such bonus by multiplying the
                  corresponding bonus that the Executive earned in the completed
                  fiscal year immediately prior to the year in which the Date of
                  Termination occurs, by the fraction obtained by dividing the
                  number of full months and any fractional portion of a month
                  during such bonus period through the Date of Termination by
                  twelve (12).

            (iii) In lieu of any further salary payments for periods subsequent
                  to the Date of Termination and in lieu of any severance
                  benefit otherwise payable to the Executive, an amount equal to
                  the sum of (A) _____ times the Executive's current Base Salary
                  at the time of such Date of Termination, (B) _____ times the
                  greater of (y) the annual cash bonus earned by the Executive
                  with respect to the most recently completed fiscal year of the
                  Company pursuant to any annual bonus or incentive program
                  maintained by the Company or (z) the average of the annual
                  cash bonuses earned by the Executive with respect to the three
                  completed fiscal years of the Company immediately preceding
                  the Date of Termination pursuant to any annual bonus or
                  incentive program maintained by the Company; and (C) the value
                  of the stock and equity-based compensation awards granted to
                  the Executive with respect to the most recent fiscal year of
                  the Company immediately preceding the Date of Termination
                  (with respect to stock options and similar awards, the value
                  shall be determined in accordance with the methodology set
                  forth in the Company's financial statements, or failing that,
                  in accordance with a Black-Scholes methodology and with
                  respect to restricted stock awards and similar awards, the
                  value shall be determined based on the fair market value of
                  the underlying stock (whether or not actually issued) on the
                  date of grant of the award without regard to any
                  restrictions); and

            (iv)  All reasonable legal fees and expenses incurred by the
                  Executive in disputing in good faith any issue hereunder
                  relating to the termination (including all such fees and
                  expenses, if any, incurred in contesting or disputing any such
                  termination, in seeking to obtain or enforce any right or
                  benefit provided by this Agreement, or in interpreting this
                  Agreement). Such payments shall be made within five (5)
                  business days after delivery of the Executive's written
                  requests for payment accompanied with such evidence of fees
                  and expenses incurred as the Company reasonably may require.

      (b) Upon a Qualifying Termination, all unvested stock options, stock
appreciation rights, restricted stock awards and all other outstanding equity
awards granted to the Executive shall immediately vest in full and, in the case
of options, stock appreciation rights or other similar awards with a maximum
period of exercise, be exercisable

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for a period of three years following such termination, provided that in no
event shall such post-termination exercise right extend after the latest date on
which such option, stock appreciation right or similar award would have expired
pursuant to its original terms.

      (c) Upon a Qualifying Termination, the Company shall maintain in full
force and effect, for the Executive's continued benefit for the ______________
after the Date of Termination, all life insurance and health insurance plans,
programs or arrangements in which he was entitled to participate immediately
prior to the Date of Termination, provided that continued participation is
possible under the general terms and provisions of such plans and programs. In
the event that participation in any such plan or program is barred, the Company
shall arrange to provide him with benefits substantially similar to those that
he is entitled to receive under such plans and programs. Benefits otherwise
receivable by the Executive pursuant to this Section 9(c) shall be reduced to
the extent benefits of the same type are received by or made available to the
Executive during the __________ period after the Date of Termination (and any
such benefits received by or made available to the Executive shall be reported
to the Company by the Executive).

      (d) Upon a Qualifying Termination, and subject to Section 9(e) below, the
Company shall satisfy remaining lease payments, if any, on the automobile
provided by the Company to the Executive for business purposes and shall
transfer to the Executive (for no additional consideration) the title to such
automobile immediately prior to the Date of Termination.

      (e) Upon a Qualifying Termination, the Company shall allow the Executive,
at Company expense, to continue to utilize the services of an accountant or
attorney of his choice for assistance in enforcing this Agreement and
preparation of his tax returns related to the year in which the termination of
employment occurred; provided, however, that the maximum aggregate value of
benefits provided pursuant to Sections 9(d) and 9(e) shall be $25,000.

      (f) All compensation and benefits payable to Executive pursuant to this
Section 9 (except pursuant to Section 9(a)(i)) are conditioned on receipt by the
Company of a release of claims by Executive in the form attached hereto as
Exhibit A and the expiration of the revocation period in such release.

      (g) For purposes of this Agreement, "Good Reason" for termination by the
Executive of the Executive's employment shall mean the occurrence (without the
Executive's express written consent which specifically references this
Agreement) within two years after any Change in Control, of any one of the
following acts by the Company, or failures by the Company to act, unless such
act or failure to act is corrected prior to the Date of Termination specified in
the Notice of Termination given in respect thereof:

            (i)   the assignment to the Executive of any duties inconsistent
                  with the Executive's status as an executive officer of the
                  Company or a substantial adverse alteration in the nature or
                  status of the Executive's responsibilities from those in
                  effect immediately prior to the Change in Control (including
                  any such alteration primarily attributable to the fact that
                  the Company may no longer be a public company including,
                  without limitation, if the Executive was, immediately prior to
                  the Change in Control, an executive officer of a public
                  company, the Executive ceasing to be an executive officer of a
                  public company);

            (ii)  a reduction by the Company in the Executive's Base Salary as
                  in effect on the date hereof or as the same may be increased
                  from time to time;

            (iii) the relocation of the Executive's principal place of
                  employment to a location outside of the ____________________
                  metropolitan area or the Company requiring the Executive to be
                  based anywhere other than such principal place of employment
                  (or permitted relocation thereof) except for required travel
                  on the Company's business to an extent substantially
                  consistent with the Executive's present business travel
                  obligations;

            (iv)  the failure by the Company to pay to the Executive any portion
                  of the Executive's current compensation;

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            (v)   the failure by the Company to continue in effect any
                  compensation plan in which the Executive participates
                  immediately prior to the Change in Control which is material
                  to the Executive's total compensation, including but not
                  limited to the Company's Amended and Restated 1993 Long Term
                  Incentive Plan and 1997 Long Term Incentive Plan or any
                  substitute or successor plans adopted prior to the Change in
                  Control, unless an equitable arrangement (embodied in an
                  ongoing substitute or alternative plan) has been made with
                  respect to such plan, or the failure by the Company to
                  continue the Executive's participation therein (or in such
                  substitute or alternative plan) on a basis not materially less
                  favorable, both in terms of the amount or timing of payment of
                  benefits provided and the level of the Executive's
                  participation relative to other participants, as existed
                  immediately prior to the Change in Control;

            (vi)  the failure by the Company to continue to provide the
                  Executive with benefits substantially similar to those enjoyed
                  by the Executive under any of the Company's pension, savings,
                  life insurance, medical, health and accident, or disability
                  plans in which the Executive was participating immediately
                  prior to the Change in Control, the taking of any other action
                  by the Company which would directly or indirectly materially
                  reduce any of such benefits or deprive the Executive of any
                  material fringe benefit enjoyed by the Executive at the time
                  of the Change in Control, or the failure by the Company to
                  provide the Executive with the number of paid vacation days to
                  which the Executive is entitled on the basis of years of
                  service with the Company in accordance with the Company's
                  normal vacation policy in effect at the time of the Change in
                  Control; or

            (vii) any purported termination of the Executive's employment which
                  is not effected pursuant to a Notice of Termination satisfying
                  the requirements of Section 4 hereof; for purposes of this
                  Agreement, no such purported termination shall be effective.
                  The Executive's right to terminate the Executive's employment
                  for Good Reason shall not be affected by the Executive's
                  incapacity due to physical or mental illness.

10.   No Mitigation

      The Company agrees that, if the Executive's employment with the Company is
terminated under this Agreement, the Executive is not required to seek other
employment or to attempt in any way to reduce any amounts payable to the
Executive by the Company pursuant to Section 9 hereof or Section 17 hereof.
Further, except as specifically provided in Section 9(c) hereof, no payment or
benefit provided for in this Agreement shall be reduced by any compensation
earned by the Executive as the result of employment by another employer, by
retirement benefits, by offset against any amount claimed to be owed by the
Executive to the Company, or otherwise.

11.   Successors, Binding Agreement

      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, by agreement in form and substance
satisfactory to the Executive, 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. Failure of the
Company to obtain such agreement prior to the effectiveness of any such
succession shall be a breach of this Agreement and shall entitle the Executive
to compensation from the Company in the same amount and on the same terms as
would apply in the event of a Qualifying Termination, except that for purposes
of implementing the foregoing, the date on which any such succession becomes
effective shall be deemed the Date of Termination. As used in this Agreement,
except for the purposes of determining whether a Change in Control has occurred,
"Company" shall mean the Company as hereinbefore defined and any successor to
its business and/or assets as aforesaid that executes and delivers the agreement
provided for in this section or which otherwise becomes bound by all the terms
and provisions of this Agreement by operation of law. This Agreement shall inure
to the benefit of and be enforceable by the Executive's personal or legal
representatives, executors, administrators, successors, heirs, distributees,
devisees and legatees. If the Executive should die while any amount would still
be payable hereunder had the Executive continued to live, all such amounts,
unless otherwise provided herein, shall be paid in accordance with the terms of
this Agreement to his devisee, legatee, or other designee or, if there be no
such

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designee, to his estate.

12.   Notice

      Notices and all other communications provided for in this Agreement shall
be in writing and shall be deemed to have been duly given when delivered or
mailed by Federal Express (or a similar package courier service), postage
prepaid, addressed to the respective addresses set forth on the first page of
this Agreement, provided that all notices to the Company shall be directed to
the attention of the Secretary of the Company, or to such other address as
either party may have furnished to the other in writing in accordance herewith,
except that notices of change of address shall be effective only upon receipt.

13.   Miscellaneous

      No provisions of this Agreement may be modified, waived or discharged
unless such modification, waiver or discharge is agreed to in writing signed by
the Executive and such officer as may be specifically designated by the Board.
No waiver by either party hereto at any time of any breach by the other party
hereto of, or compliance with, 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. This Agreement supersedes any other agreements or representations, oral or
otherwise, express or implied, with respect to the subject matter hereof which
have been made by either party. The validity, interpretation, construction and
performance of this Agreement shall be governed by the laws of the State of
Maryland.

14.   Validity

      The invalidity or unenforceability of any one or more 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.

15.   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.

16.   Arbitration

      Any dispute or controversy arising under or in connection with this
Agreement shall be settled exclusively by arbitration in New York, New York in
accordance with the rules of the American Arbitration Association then in
effect; provided that all arbitration expenses shall be borne by the Company.
Notwithstanding the pendency of any dispute or controversy concerning
termination or the effects thereof, the Company will continue to pay the
Executive his full compensation in effect immediately before any Notice of
Termination giving rise to the dispute was given and continue him as a
participant in all compensation, benefit and insurance plans in which he was
then participating, until the dispute is finally resolved if such dispute is
brought in good faith and the Executive pursues the resolution of such dispute
with reasonable diligence. Amounts paid under this paragraph are in addition to
all other amounts due under this Agreement and shall not be offset against or
reduce any other amounts due under this Agreement. Judgment may be entered on
the arbitrators' award in any court having jurisdiction; provided, however, that
the Executive shall be entitled to seek specific performance of his right to be
paid until the Date of Termination during the pendency of any dispute or
controversy arising under or in connection with this Agreement.

17.   Additional Payments

      (a) Anything in this Agreement to the contrary notwithstanding, in the
event it shall be determined (as hereafter provided) that any payment or
distribution to or for the Executive's benefit, whether paid or payable or
distributed or distributable pursuant to the terms of this Agreement or
otherwise pursuant to or by reason of any other agreement, policy, plan, program
or arrangement (including without limitation any restricted stock or stock
option agreement), or similar right (a "Payment"), would be subject to the
excise tax imposed by Section 4999 of the Internal Revenue Code of 1986 (or any
successor provision thereto) (the "Code"), or any interest or penalties with

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respect to such excise tax (such excise tax, together with any such interest and
penalties, are hereafter collectively referred to as the "Excise Tax"), then the
Executive shall be entitled to receive an additional payment or payments (a
"Gross-Up Payment") in an amount such that, after payment by the Executive of
all taxes (including any interest or penalties imposed with respect to such
taxes), including any Excise Tax, imposed upon the Gross-Up Payment, the
Executive retains an amount of the Gross-Up Payment equal to the Excise Tax
imposed upon the Payments.

      (b) In the event that, after giving effect to any redeterminations
described in subsection (c) of this Section 17, the aggregate Payments do not
equal or exceed 120% of the Safe Harbor Amount (as defined below), then no
Gross-Up Payment shall be payable to the Executive and the aggregate amount of
Payments payable to the Executive shall be reduced to the Safe Harbor Amount.
"Safe Harbor Amount" means the greatest pre-tax amount of Payments that could be
paid to the Executive without causing the Executive to become liable for any
Excise Tax in connection therewith.

      (c) Subject to the provisions of Section 17(f), all determinations
required to be made under this Section 17, including whether an Excise Tax is
payable by the Executive, the amount of such Excise Tax, whether a Gross-Up
Payment is required, and the amount of such Gross-Up Payment, shall be made by a
nationally-recognized legal or accounting firm (the "Firm") mutually acceptable
to the Executive and the Company. The Executive agrees to direct the Firm to
submit its determination and detailed supporting calculations to both the
Executive and the Company as promptly as practicable. If the Firm determines
that any Excise Tax is payable by the Executive and that a Gross-Up Payment is
required, the Company shall pay the Executive the required Gross-Up Payment
within ten business days after receipt of such determination and calculations.
If the Firm determines that no Excise Tax is payable by the Executive, it shall,
at the same time as it makes such determination, furnish the Executive with an
opinion that the Executive has substantial authority not to report any Excise
Tax on the Executive's federal income tax return. Any determination by the Firm
as to the amount of the Gross-Up Payment shall be binding upon the Executive and
the Company. As a result of the uncertainty in the application of Section 4999
of Code at the time of the initial determination by the Firm hereunder, it is
possible that Gross-Up Payments which will not have been made by the Company
should have been made (an "Underpayment"). In the event that the Company
exhausts its remedies pursuant to Section 17(f) hereof and the Executive
thereafter is required to make a payment of any Excise Tax, the Executive may
direct the Firm to determine the amount of the Underpayment (if any) that has
occurred and to submit its determination and detailed supporting calculations to
both the Executive and the Company as promptly as possible. Any such
Underpayment shall be promptly paid by the Company to the Executive, or for the
Executive's benefit, within ten business days after receipt of such
determination and calculations.

      (d) The Executive and the Company shall each provide the Firm access to
and copies of any books, records and documents in the possession of the Company
or the Executive, as the case may be, reasonably requested by the Firm, and
otherwise cooperate with the Firm in connection with the preparation and
issuance of the determination contemplated by Sections 17(c) hereof.

      (e) The fees and expenses of the Firm for its services in connection with
the determinations and calculations contemplated by Section 17(c) hereof shall
be borne by the Company. If such fees and expenses are initially paid by the
Executive, the Company shall reimburse the Executive the full amount of such
fees and expenses within ten business days after receipt from the Executive of a
statement therefor and reasonable evidence of the Executive's payment thereof.

      (f) The Executive agrees to notify the Company in writing of any claim by
the Internal Revenue Service that, if successful, would require the payment by
the Company of a Gross-Up Payment. Such notification shall be given as promptly
as practicable but no later than 10 business days after the Executive actually
receives notice of such claim. The Executive agrees to further apprise the
Company of the nature of such claim and the date on which such claim is
requested to be paid (in each case, to the extent known by the Executive). The
Executive agrees not to pay such claim prior to the earlier of (a) the
expiration of the 30-calendar-day period following the date on which the
Executive gives such notice to the Company and (b) the date that any payment
with respect to such claim is due. If the Company notifies the Executive in
writing at least five business days prior to the expiration of such period that
it desires to contest such claim, the Executive agrees to:

            (i)   provide the Company with any written records or documents in
                  the Executive's possession relating to such claim reasonably
                  requested by the Company;

                                      -13-

<PAGE>

            (ii)  take such action in connection with contesting such claim as
                  the Company shall reasonably request in writing from time to
                  time, including without limitation accepting legal
                  representation with respect to such claim by an attorney
                  competent in respect of the subject matter and reasonably
                  selected by the Company;

            (iii) cooperate with the Company in good faith in order effectively
                  to contest such claim; and

            (iv)  permit the Company to participate in any proceedings relating
                  to such claim;

      provided, however, that the Company shall bear and pay directly all costs
and expenses (including interest and penalties) incurred in connection with such
contest and shall indemnify and hold the Executive harmless, on an after-tax
basis, from and against any Excise Tax or income tax, including interest and
penalties with respect thereto, imposed as a result of such representation and
payment of costs and expenses. Without limiting the foregoing provisions of this
Section 17(f), the Company shall control all proceedings taken in connection
with the contest of any claim contemplated by this Section 17(f) and, at its
sole option, may pursue or forego any and all administrative appeals,
proceedings, hearings and conferences with the taxing authority in respect of
such claim (provided, however, that the Executive may participate therein at the
Executive's own cost and expense) and may, at its option, either direct the
Executive to pay the tax claimed and sue for a refund or contest the claim in
any permissible manner, and the Executive agrees to prosecute such contest to a
determination before any administrative tribunal, in a court of initial
jurisdiction and in one or more appellate courts, as the Company shall
determine; provided, however, that if the Company directs the Executive to pay
the tax claimed and sue for a refund, the Company shall advance the amount of
such payment to the Executive on an interest-free basis and shall indemnify and
hold the Executive harmless, on an after-tax basis, from any Excise Tax or
income tax, including interest or penalties with respect thereto, imposed with
respect to such advance; and provided further, however, that any extension of
the statute of limitations relating to payment of taxes for the Executive's
taxable year with respect to which the contested amount is claimed to be due is
limited solely to such contested amount. Furthermore, the Company's control of
any such contested claim shall be limited to issues with respect to which a
Gross-Up Payment would be payable hereunder and the Executive shall be entitled
to settle or contest, as the case may be, any other issue raised by the Internal
Revenue Service or any other taxing authority.

      (g) If, after the receipt by the Executive of an amount advanced by the
Company pursuant to Section 17(f) hereof, the Executive receives any refund with
respect to such claim, the Executive agrees (subject to the Company's complying
with the requirements of Section 17(f) hereof) to promptly pay to the Company
the amount of such refund (together with any interest paid or credited thereon
after any taxes applicable thereto. If, after the Executive's receipt of an
amount advanced by the Company pursuant to Section 17(g) hereof, a determination
is made that the Executive is not entitled to any refund with respect to such
claim and the Company does not notify the Executive in writing of its intent to
contest such denial of refund prior to the expiration of 30 calendar days after
such determination, then such advance shall be forgiven and shall not be
required to be repaid and the amount of such advance shall offset, to the extent
thereof, the amount of Gross-Up Payment required to be paid pursuant to this
Section 17.

18.   Withholding of Taxes

      The Company may withhold from any amounts payable under this Agreement all
federal, state, city or other taxes as shall be required pursuant to any law or
government regulation or ruling.

19.   Legal Fees and Expenses

      It is the intent of the Company that the Executive not be required to
incur the legal expenses associated with (i) the interpretation of any provision
in, or obtaining of any right or benefit under, this Agreement or (ii) the
enforcement of his rights under this Agreement by litigation or other legal
action pursued in good faith, because the cost and expense thereof would
substantially detract from the benefits intended to be extended to the Executive
hereunder. Accordingly, the Company irrevocably authorizes the Executive from
time to time to retain counsel of his choice, at the expense of the Company as
hereafter provided; to represent the Executive in connection with the
interpretation or enforcement of this Agreement, including the good faith
initiation or defense of any litigation or

                                      -14-

<PAGE>

other legal action, whether by or against the Company or any director, officer,
shareholder or other person affiliated with the Company, in any jurisdiction.
The Company shall pay or cause to be paid and shall be solely responsible for
any and all reasonable attorneys' and related fees and expenses incurred by the
Executive under this Section 19.

                                           THE TOWN AND COUNTRY TRUST

                                           By: _________________________________
                                               Name:
                                               Title:

                                           _____________________________________
                                           [EXECUTIVE]

                                     -15-EX-10.13

 

Exhibit 10.13

Separation Agreement and Release

I, Hudson D. Smith, have knowingly and voluntarily entered into the following agreement with
SIFCO Industries, Inc. (hereinafter referred to as “the Company”) regarding the termination of my
employment with the Company.

	 	I.  	Termination of Employment Relationship: With the signing of this Agreement,
I acknowledge that my employment with the Company will be terminated effective January 31,
2005 (the “Effective Date”).
	 
	 	II.  	Benefits: In full consideration for my signing this Agreement, the Company
will provide the following severance benefits, all of which are more than I would be
entitled to receive absent signing this Agreement:

	 	A.  	The Company will pay me two (2) years of separation pay at my
current base salary, less any applicable payroll deductions. I understand that my
separation pay will be paid in two installments of $110,000 each, with the first
payment made on the Effective Date and the second payment made on January 31,
2006. If I should die before either installment is paid, the Company agrees to
make full payment to my wife as beneficiary, and should my wife not survive me,
then to my executors, heirs and assigns.
	 
	 	B.  	For a period of 18 months commencing on the Effective Date, the
Company will maintain my medical and dental benefits under a Company-sponsored
group health plan, as long as I continue to make the required monthly payments to
the Company at the applicable employee rate. The benefits provided under the
Company’s group health plans and the required employee contributions are subject
to change at any time with 30 days advance notice. This 18-month period following
the Effective Date will satisfy the Company’s COBRA requirements, and there will
be no further continuation of benefits under a Company group health plan upon the
conclusion of this period.
	 
	 	C.  	The Company will reimburse me for costs associated with my attendance
at Forging Industry Association Board meetings for the balance of my current term
as Director of this Association. The items to be reimbursed are coach fare flight
costs, hotel (bed and breakfast only), and meeting registration fees. The Company
President and Chief Operating Officer must authorize the spending for each Board
meeting, and receipts will be required for reimbursement in accordance with the
Company’s customary practices.
	 
	 	D.  	The Company will continue to provide executive outplacement services
through the current provider for a period of up to three (3) months following my
termination date.

	 	III.  	Terms: I understand and acknowledge that SIFCO is not obligated to provide
me with the separation pay described in Section II of this Agreement. Nevertheless, in
order to end my employment relationship with SIFCO as amicably as possible and to
eliminate any possibility of future disputes, I have been offered and have accepted this
separation pay, and in consideration for which I agree to the provisions of this Agreement
as follows:

	 	A.  	Release: In consideration of the benefits provided to me under this
Agreement, I, my heirs, personal representatives, assigns and agents and each of
them, hereby do irrevocably and unconditionally forever release, waive and
discharge the Company (and any related corporation, including their officers,
agents, directors, representatives, shareholders and employees, and, as
applicable, their predecessors, successors, assigns, heirs and executors) from any
and all claims and or causes of action arising out of or in connection with my
employment relationship with the Company and the termination of my employment,
arising at any point in time up to and including the date I signed this

3

 

	 	   	Agreement, and agree not to file any such claims and or causes of action against
any of them before any court or administrative agency. I, my heirs, personal
representatives, assigns and agents and each of them, hereby agree to waive any
remedy that may be available under any such action that may have filed, and further
agree to dismiss or withdraw any such action. This release and agreement not to
sue includes, but is not limited to, claims arising under federal, state or local
laws, including Title VII of the Civil Rights Act of 1964, as amended, the Age
Discrimination in Employment Act, the Americans with Disabilities Act, the Civil
Rights Act of 1991, the Rehabilitation Act of 1973 and any common law or
contractual claims recognized now or later. The mutual releases contained herein
apply only to the employment relationship of the parties.
	 
	 	B.  	Confidentiality: I will not at any time, directly or indirectly,
without written authorization from the Company, make use of or disclose to any
person or entity any confidential business-related, proprietary or secret
information, confidential knowledge, trade secrets, or other confidential data
related to the customers, business, products, services or practices of the Company
of which I have become possessed during my employment with the Company, whether
prepared by me or another, and which is not, or does not become, available or
known to the public. I further agree that upon termination of my employment I will
immediately return to the Company all of its property in my possession or under my
control, including, without limitation, keys, credit cards, programs, lists,
files, and software. However, I understand that I may retain the personal
computer and printer currently used by me in my present position; provided
however, that any Company information on such computers shall be removed in their
entirety. I further agree that I shall not retain any copies or reproductions of
the foregoing. I understand that certain terms of this Agreement must be
disclosed to the public because of my position as an Officer of the Company.
However, I also understand that the Company will maintain confidentiality with
respect to the terms of my separation from the Company which are not subject to
disclosure.
	 
	 	C.  	Non-disparagement: I agree that I will not disparage the Company or
any of its affiliates or their businesses, products, services, practices, or
employees; and likewise I understand that the Company agrees not to disparage me.
	 
	 	D.  	Notice: I acknowledge that I have been provided up to 21 days, if I
feel it is necessary, to review the terms of this Agreement and to consider its
effect, including the foregoing release. I also acknowledge that I have had an
ample opportunity and have been advised and encouraged to discuss this Agreement
and my separation from employment with persons of my own choosing, notwithstanding
the terms of Paragraph III B of this Agreement, including an attorney. I
understand that I may revoke this Agreement by providing written notice of
revocation to the Company at its Cleveland, Ohio business address not later than
seven (7) days from the day I sign the Agreement.
	 
	 	E.  	Acknowledgment: I acknowledge that any benefits due me under any
pension, profit sharing or other qualified retirement plan shall be determined in
accordance with the terms of such plan(s) in effect at the time of my termination.
I further acknowledge that, except as provided in this Agreement and with the
exception of (i) the reconciliation of earned vacation which will be provided in
my final paycheck, and (ii) any approved expenses not known at this time, all
compensation and other payments due to me as a result of my employment with the
Company, whether due directly from the Company or from any of its affiliated
entities, have been paid in full and that I am not entitled to any additional
salary, bonuses or any other payments whatsoever.
	 
	 	F.  	Non-Admission: I agree and acknowledge that this Agreement is not and
shall not be construed to be an admission of any violation of any federal, state
or local law, regulation, or of any duty the Company owed to me or I owed to the
Company, and that

4

 

	 	   	the execution of this Agreement is a voluntary act intended to provide an amicable
conclusion to my employment relationship with the Company.
	 
	 	G.  	Severability: The terms of this Agreement are separate and
independent and should any of them be declared invalid or unenforceable by any
court, the remaining provisions and terms of this Agreement shall remain in full
force and effect.
	 
	 	H.  	Choice of Law: This Agreement shall be interpreted in accordance
with the laws of Ohio, and any action sought to enforce or interpret this
Agreement must be filed in the Court of Common Pleas in and for Cuyahoga County,
in the state of Ohio.

	 	IV.  	Acknowledgement: The parties hereto acknowledge Hudson’s continuing service to the
Company beyond the Effective Date of this Separation Agreement and Release as a Director
thereof.

Accordingly, having carefully read and fully understanding the terms of this Separation Agreement
and Release, and without relying upon any other representations or statements (whether written or
oral), I have knowingly and voluntarily executed this Agreement without duress or coercion.

	 	 	 
	/s/ Hudson D. Smith

	 	/s/ Frank A. Cappello
	 

	 	 
	Hudson D. Smith

Date: January 27, 2005

	 	Frank A. Cappello

Witness

Date: January 27, 2005
	 
	 	 
	SIFCO Industries, Inc.
	 	 
	 
	 	 
	/s/ Timothy V. Crean

	 	/s/ Jeffrey P. Gotschall
	 

	 	 
	Timothy V. Crean

President and Chief Operating Officer,

SIFCO Industries, Inc.

	 	Jeffrey P. Gotschall

Witness
	 
	 	 
	Date: January 26, 2005

	 	Date: January 26, 2005

5

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