Document:

r10ka09162009ex10x.htm

  

  

  

 

May 27, 2009

 

Twin Disc, Incorporated

1328 Racine Street

Racine, Wisconsin  5340311208

Attention: Mr. Christopher J. Eperjesy

 

Re:           Amendment No. 4 to Note Agreement

 

Ladies and Gentlemen:

 

This letter amendment (this “Letter”) makes reference to that certain Note Agreement, dated as of April 10, 2006 (as amended by Amendment No. 1 thereto dated March 1, 2007, Amendment No. 2 thereto dated August 22, 2007 and Amendment No. 3 thereto dated February 19, 2009,
the “Note Agreement”), among The Prudential Insurance Company of America, Pruco Life Insurance Company, Pruco Life Insurance Company of New Jersey, Security Benefit Life Insurance Company, Inc., American Skandia Life Assurance Corporation, Mutual of Omaha Insurance Company (collectively, the “Holders” and each, a “Holder”)
and Twin Disc, Incorporated, a Wisconsin corporation (the “Company”). Capitalized terms used herein and not otherwise defined herein shall have the meanings assigned to such terms in the Note Agreement, as amended hereby.

The Company has requested that the Holders amend the Note Agreement as set forth below.  Subject to the terms and conditions hereof, the Holders are willing to agree to such requests.

 

Accordingly, and in accordance with the provisions of paragraph 11C of the Note Agreement, the parties hereto agree as follows:

 

SECTION 1.                                Amendments. Effective
upon the Effective Date (as defined in Section 2 below), the Holders party hereto and the Company agree that the Note Agreement is amended as follows:

 

1.1           Clause (iii) of paragraph 5M of the Note Agreement is amended and restated as follows:

 

“(iii)           Maximum Total Funded Debt to EBITDA Ratio.  The Company and its consolidated Subsidiaries shall not permit the ratio of Total Funded Debt
to EBITDA to exceed the following ratio as of the following dates, all as determined, in the case of Total Funded Debt, on the date of determination, and in the case of EBITDA, for the preceding four fiscal quarters of the Company and its consolidated Subsidiaries ending on the date of determination:

 

	
Date of Determination
	
Maximum Ratio

	
June 30, 2006 and at the end of
	  
	
each fiscal quarter thereafter
	  
	
through and including
	  
	
March 31, 2009
	
2.50 to 1.00

	  	  
	
June 30, 2009 and at the end of
	  
	
each fiscal quarter thereafter
	
3.00 to 1.00”

1.2.           A new paragraph 5O is added to the Note Agreement as follows:

 

“5O.           Excess Leverage Fee.  If the ratio of Total Funded Debt to EBITDA, determined, in the case of Total Funded Debt, on the date of determination,
and in the case of EBITDA, for the preceding four fiscal quarters of the Company and its consolidated Subsidiaries ending on the date of determination, as of the end of any fiscal quarter ending on or after June 30, 2009 is greater than 2.50 to 1.00, then, in addition to the interest accruing on the Notes, the Company agrees to pay to each holder of a Note a fee (the “Excess Leverage Fee”) on the daily average outstanding principal amount of
such Note during such fiscal quarter at a rate per annum equal to 0.50%.  The Excess Leverage Fee with respect to each Note for any fiscal quarter shall be calculated on the same basis as interest on such Note is calculated and shall be paid in arrears within forty-five (45) days of the end of such fiscal quarter.  The payment of any Excess Leverage Fee shall not constitute a waiver of any Default or Event of Default.  If for any reason the Company fails to deliver the financial
statements required by paragraph 5D hereof for a fiscal quarter or fiscal year by the date the Excess Leverage Fee, if any, would be payable for such fiscal quarter, then, for the purposes of this paragraph 5O, the ratio of Total Funded Debt to EBITDA for such fiscal quarter or for the last fiscal quarter of such fiscal year, as the case may be, shall be deemed to be greater than 2.50 to 1.00.”

 

1.3.           Clause (c) of paragraph 7A of the Note Agreement is amended by replacing “(ii)” therein with “(i)”.

 

1.4.           A new definition of “Excess Leverage Fee” is added in alphabetical order to paragraph 10B of the Note Agreement as follows:

 

“Excess Leverage Fee” shall have the meaning given in paragraph 5O.

 

1.5.           Clause (i) of the definition of “Notice Event of Default” in paragraph 10B of the Note Agreement is amended and restated in its entirety as follows:

 

“(i)           The Company shall fail: (a) to pay when due any principal of any Note; (b) to pay when due any interest on, or Yield-Maintenance Amount with respect to, any Note or any fee (including without limitation any Excess Leverage Fee), expense or other amount due under
this Agreement or any Note; or”

 

1.6.           Paragraph 10C of the Note Agreement is amended by adding the following sentence to the end thereof:

“Notwithstanding the foregoing or any other provision of this Agreement providing for any amount to be determined in accordance with generally accepted accounting principles, for purposes of determining compliance with the financial covenants contained in this Agreement, any election by the Company to measure an item of Indebtedness
(other than contingent obligations of the type described in clause (iv) of the definition of Indebtedness) using fair value (as permitted by Statement of Financial Accounting Standards No. 159 or any similar accounting standard) shall be disregarded and such determination shall be made as if such election had not been made.”

 

SECTION 2.                                Effectiveness.  The
amendments in Section 1 of this Letter shall become effective on the date (the “Effective Date”) of satisfaction of the following:

 

(a)           Receipt by each Holder party hereto of counterparts of this Letter executed by the Company and the Required Holders;

 

(b)           Receipt by each Holder party hereto of a copy of an amendment under the Credit Agreement, amending the Credit Agreement consistent with the amendments set forth herein and otherwise in form and substance satisfactory to the Required Holders, duly executed by the Company
and the Bank, and such amendment shall be in full force and effect; and

 

(c)           All corporate and other proceedings in connection with the transactions contemplated by this Letter shall be satisfactory to the Required Holders, and each Holder party hereto shall have received all such counterpart originals or certified or other copies of such documents
as it may reasonably request.

 

SECTION 3.                                Representations
and Warranties.  The Company represents and warrants to the Holders that, after giving effect hereto (a) each representation and warranty set forth in paragraph 8 of the Note Agreement is true and correct as of the date of the execution and delivery of this Letter by the Company with the same effect as if made on such date (except to the extent such representations and warranties expressly refer to an earlier date, in which case they were
true and correct as of such earlier date), (b) no Event of Default or Default exists and (c) neither the Company nor any of its Subsidiaries has paid or agreed to pay, and neither the Company nor any of its Subsidiaries will pay or agree to pay, any fees or other consideration to any Person in connection with the amendment referenced in Section 2(b) hereof.

 

SECTION 4.                                Reference
to and Effect on Note Agreement.  Upon the effectiveness of the amendments made in this Letter, each reference to the Note Agreement in any other document, instrument or agreement shall mean and be a reference to the Note Agreement as modified by this Letter.  Except as specifically set forth in Section 1 hereof, the Note Agreement shall remain in full force and effect and is hereby ratified and confirmed in all respects.  The Company hereby represents and warrants that all
necessary or required consents to this Letter have been obtained and are in full force and effect.  Except as specifically stated in Section 1 of this Letter, the execution, delivery and effectiveness of this Letter shall not (a) amend the Note Agreement or any Note, (b) operate as a waiver of any right, power or remedy of the holder of any Note, or (c) constitute a waiver of, or consent to any departure from, any provision of the Note Agreement or any Note at any time.  The execution, delivery
and effectiveness of this Letter shall not be construed as a course of dealing or other implication that any Holder has agreed to or is prepared to grant any amendments to the Note Agreement or any Note in the future, whether or not under similar circumstances.

 

SECTION 5.                                Expenses. The
Company hereby confirms its obligations under the Note Agreement, whether or not the transactions hereby contemplated are consummated, to pay, promptly after request by any Holder, all reasonable out-of-pocket costs and expenses, including attorneys’ fees and expenses, incurred by the Holders in connection with this Letter or the transactions contemplated hereby, in enforcing any rights under this Letter, or in responding to any subpoena or other legal process or informal investigative demand issued in
connection with this Letter or the transactions contemplated hereby.  The obligations of the Company under this Section 5 shall survive transfer by any Holder of any Note and payment of any Note.

 

SECTION 6.                                Governing
Law.  THIS LETTER SHALL BE CONSTRUED AND ENFORCED IN ACCORDANCE WITH THE INTERNAL LAWS OF THE STATE OF ILLINOIS, WITHOUT REGARD TO PRINCIPLES OF CONFLICT OF LAWS OF SUCH STATE WHICH WOULD OTHERWISE CAUSE THIS LETTER TO BE CONSTRUED OR ENFORCED OTHER THAN IN ACCORDANCE WITH THE LAWS OF THE STATE OF ILLINOIS.

 

SECTION 7.                                Counterparts;
Section Titles.  This Letter may be executed in any number of counterparts and by different parties hereto in separate counterparts, each of which when so executed and delivered shall be deemed to be an original and all of which taken together  shall constitute but one and the same instrument.  Delivery of an executed counterpart of a signature page to this Letter by facsimile or electronic transmission shall be effective
as delivery of a manually executed counterpart of this Letter.  The section titles contained in this Letter are and shall be without substance, meaning or content of any kind whatsoever and are not a part of the agreement between the parties hereto.

 

[remainder of page intentionally left blank; signature page follows]

 

  

  

  

Very truly yours,

 

 

 

THE PRUDENTIAL INSURANCE COMPANY

 

   OF AMERICA

 

 

 

By: ___________________________________

 

Vice President

 

PRUCO LIFE INSURANCE COMPANY

 

By:  ___________________________________

Vice President

 

PRUCO LIFE INSURANCE COMPANY OF

 

  NEW JERSEY

 

By:  ___________________________________

Vice President

SECURITY BENEFIT LIFE INSURANCE

  COMPANY, INC.

By:           Prudential Private Placement Investors,

L.P. (as Investment Advisor)

By:           Prudential Private Placement Investors, Inc.

(as its General Partner)

By:  ______________________________

Vice President

AMERICAN SKANDIA LIFE ASSURANCE

 

   CORPORATION

 

By:           Prudential Investment Management, Inc.,

as investment manager

By:______________________________

Vice President

MUTUAL OF OMAHA INSURANCE

  COMPANY

By:           Prudential Private Placement Investors,

L.P. (as Investment Advisor)

By:           Prudential Private Placement Investors, Inc.

(as its General Partner)

By:  ______________________________

Vice President

Signature Page to

Amendment No. 4

  

  

  

THE LETTER IS AGREED TO

 

AND ACCEPTED BY:

 

TWIN DISC, INCORPORATED

By:______________________________

Name: ___________________________

Title: ____________________________EMPLOYMENT AGREEMENT

            AGREEMENT made as of the 14th day of September, 2009, by and among Cedar Shopping Centers, Inc., a Maryland corporation (the “Corporation”), Cedar Shopping Centers Partnership, L.P., a Delaware limited partnership (the “Partnership”), and Joel I. Yarmak (the “Executive”).

            
                	
                             

                        	
                            1.

                        	
                            Position and Responsibilities.

                        

            

            1.1       The Executive shall serve in an executive capacity as Chief Administrative Officer of both the Corporation and the Partnership with duties consistent therewith and shall perform such other functions and undertake such other responsibilities as are customarily associated with such capacity. The Executive shall report
            directly to the Chief Executive Officer of the Corporation. The Executive shall also hold such directorships and officerships in the Corporation, the Partnership and any of their subsidiaries to which, from time to time, the Executive may be elected or appointed during the term of this Agreement.

            1.2       The Executive shall devote Executive’s full business time and skill to the business and affairs of the Corporation and the Partnership and to the promotion of their interests.

            
                	
                             

                        	
                            2.

                        	
                            Term of Employment.

                        

            

            2.1       The term of employment shall be two years, commencing with the date hereof, unless sooner terminated as provided in this Agreement.

            2.2       Notwithstanding the provisions of Section 2.1 hereof, each of the Corporation and the Partnership shall have the right, on written notice to the Executive, to terminate the Executive’s employment for Cause (as defined in Section 2.3), such termination to be effective as of the date on which notice is given or as of
            such later date otherwise specified in the notice and, upon such termination of employment for Cause, Executive shall not be entitled to receive any additional compensation hereunder. The Executive shall have the right, on written notice to the Corporation and the Partnership, to terminate the Executive’s employment for Good Reason (as defined in Section 2.4), such termination to be effective as of the date on which notice is given or as of such later
            date otherwise specified in the notice; provided, however, the Executive’s right to terminate Executive’s employment shall lapse 60 days after the occurrence of any of the events specified in clauses (iii) or (iv) of the definition of Good Reason.

            2.3       For purposes of this Agreement, the term “Cause” shall mean any of the following actions by the Executive: (a) failure to comply with any of the material terms of this Agreement, which shall not be cured within 10 days after written notice, or if the same is not of a nature that it can be completely cured
            within such 10 day period, if Executive shall have failed to commence to cure the same within such 10 day period and shall have failed to pursue the cure of the same diligently thereafter; (b) engagement in gross misconduct injurious to the business or reputation of the Corporation or the Partnership; (c) knowing and willful neglect or refusal to attend to the material duties assigned to the Executive by the Board of Directors of the Corporation, which shall not be cured within 10
            days after written notice; (d) intentional misappropriation of property of the Corporation or the Partnership to the Executive’s own use; (e) the commission by the Executive of an act of fraud or embezzlement; (f) Executive’s conviction for a felony; or (g) Executive’s engaging in any activity which is prohibited pursuant to Section 5 of this Agreement, which shall not be cured within 10 days after written notice.

             

            2.4       For purposes of this Agreement, the term “Good Reason” shall mean any of the following: (i) a material breach of this Agreement by the Corporation or the Partnership which shall not be cured within 10 days after written notice; (ii) a material reduction in the Executive’s duties or responsibilities;
            (iii) the relocation of the Executive’s office or the Corporation’s or Partnership’s executive offices to a location more than 30 miles from New York City; or (iv) a “Change in Control”, as defined below. As used herein, a “Change in Control” shall be deemed to occur if: (i) there shall be consummated (x) any consolidation or merger of the Corporation or the Partnership in which the Corporation or the Partnership is not the continuing
            or surviving corporation or pursuant to which the stock of the Corporation or the units of the Partnership would be converted into cash, securities or other property, other than a merger or consolidation of the Corporation or Partnership in which the holders of the Corporation’s stock immediately prior to the merger or consolidation hold more than fifty percent (50%) of the stock or other forms of equity of the surviving corporation immediately after the merger, or (y) any
            sale, lease, exchange or other transfer (in one transaction or series of related transactions) of all, or substantially all, the assets of the Corporation or the Partnership; (ii) the Board approves any plan or proposal for liquidation or dissolution of the Corporation or the Partnership; or (iii) any person acquires more than 29% of the issued and outstanding common stock of the Corporation.

            
                	
                             

                        	
                            3.

                        	
                            Compensation.

                        

            

            3.1       The Partnership shall pay to the Executive for the services to be rendered by the Executive hereunder to the Corporation and the Partnership a base salary at the rate of $275,000 per annum. Upon Executive’s commencement of employment, (a) the Partnership shall pay to the Executive the amount of $10,000 in cash and (b)
            the Corporation shall make an award to the Executive of 7,500 shares of restricted stock of the Corporation which will cliff-vest on the third anniversary of the date of this Agreement if the Executive remains employed by the Corporation at that date, except as such vesting may otherwise be accelerated pursuant to Section 4.1(ii) hereof. The base salary shall be payable in accordance with the Corporation’s or Partnership’s normal payroll practices,
            but not less frequently than twice a month. Such base salary will be reviewed at least annually and may be increased (but not decreased) by the Board of Directors of the Corporation in its sole discretion. The Executive shall participate in the Corporation’s annual bonus plan for senior executive officers. The payment of any bonus is within the discretion of the Board of Directors of the Corporation, based on recommendations of the Compensation Committee. For calendar year
            2010, the Executive’s bonus would be targeted at an annualized initial amount of not less than $100,000, payable in a combination of cash and restricted stock issued under the Corporation’s stock incentive plan; provided, however, that if the bonus target is not met, then the bonus will be adjusted in the same way as the bonus of other executive officers of the Corporation is adjusted. The amount of the bonus will be guaranteed for one year from the date hereof, based on
            the pro-rata portion of the 2009 year and the pro rata portion of the 2010 year ending on the first anniversary of the date of this Agreement. The Executive will also be entitled to participate in the Corporation’s long-term incentive compensation plan pursuant to which he will be granted annual long-term restricted stock grants as determined by the Board of Directors, based on the recommendations of the Compensation Committee, which the Corporation projects will be in the
            initial amount of $75,000 for the first year, subject to normal vesting and performance requirements established by the Board of Directors. The amount of the long-term incentive compensation award will be guaranteed for one year from the date hereof, based on the pro-rata portion of the 2009 year and the pro-rata portion of the 2010 year ending on the first anniversary of the date of this Agreement.

            3.2       The Executive shall be entitled to participate in, and receive benefits from, on the basis comparable to other senior executives, any insurance, medical, disability, or other employee benefit plan of the Corporation, the Partnership or any of their subsidiaries which may be in effect at any time during the course of
            Executive’s employment by the Corporation and the Partnership and which shall be generally available to senior executives of the Corporation, the Partnership or any of their subsidiaries.

            3.3       The Partnership agrees to reimburse the Executive for all reasonable and necessary business expenses incurred by the Executive on behalf of the Corporation or the Partnership in the course of Executive’s duties hereunder upon the presentation by the Executive of appropriate vouchers therefor, including a cell phone,
            portable computer, continuing legal education, professional licenses and organizations and conferences.

            3.4       The Executive shall be entitled each year of this Agreement to paid vacation in accordance with the Corporation’s or Partnership’s policies but not less than three weeks plus personal and floating holidays (and a ratable number of sick days), which if not taken during such year will be forfeited (unless
            management requests postponement).

            3.5       If, during the period of employment hereunder, because of illness or other incapacity, the Executive shall fail for a period of 90 consecutive days, or for shorter periods aggregating more than six months during the term of this Agreement, to render the services contemplated hereunder, then the Corporation or the
            Partnership, at either of their options, may terminate the term of employment hereunder by notice from the Corporation or the Partnership, as the case may be, to the Executive, effective on the giving of such notice. 

             

            During any period of disability of Executive during the term hereof, the Corporation shall continue to pay to Executive the salary and bonus to which the Executive is entitled pursuant to Section 3.1 hereof.

            3.6       In the event of the death of the Executive during the term hereof, the employment hereunder shall terminate on the date of death of the Executive.

            3.7       Each of the Corporation and the Partnership shall have the right to obtain for their respective benefits an appropriate life insurance policy on the life of the Executive, naming the Corporation or the Partnership as the beneficiary. If requested by the Corporation or the Partnership, the Executive agrees to cooperate with
            the Corporation or the Partnership, as the case may be, in obtaining such policy.

            
                	
                             

                        	
                            4.

                        	
                            Severance Compensation Upon Termination of Employment.

                        

            

            4.1       If the Executive’s employment with the Corporation or the Partnership shall be terminated (a) by the Corporation or Partnership other than for Cause or other than pursuant to Sections 3.5 or 3.6, or (b) by the Executive for Good Reason, then the Corporation and the Partnership shall:

            (i)        pay to the Executive as severance pay, within five days after termination, a lump sum payment equal to the Executive’s annual salary at the rate applicable on the date of termination for the remaining term of this Agreement (but in no event less than $275,000), plus $50,000, representing
            one-half of the targeted bonus; 

            (ii)       arrange to provide Executive, for a six month period (or such shorter period as Executive may elect), with disability, accident and health insurance substantially similar to those insurance benefits which Executive is receiving immediately prior to the earlier of a Change in Control, if any, or the
            date of termination to the extent obtainable upon reasonable terms; provided, however, if it is not so obtainable the Corporation shall pay to the Executive in cash the annual amount paid by the Corporation or the Partnership for such benefits during the previous six months of the Executive’s employment. Benefits otherwise receivable by Executive pursuant to this Section 4.1(ii) shall be reduced to the extent comparable benefits are actually received by the Executive during
            such six month period following his termination (or such shorter period elected by the Executive), and any such benefits actually received by Executive shall be reported by the Executive to the Corporation; and

            (iii)      any options granted to Executive to acquire common stock of the Corporation, any restricted shares of common stock of the Corporation issued to the Executive and any other awards granted to the Executive under any employee benefit plan that have not vested shall immediately vest on such
            termination.

            4.2       (a)       The Executive shall not be required to mitigate damages or the amount of any payment provided for under this Agreement by seeking other employment or otherwise, nor, except to the extent provided in Section 4.1 above, shall the amount of any payment provided for under this
            Agreement be reduced by any compensation earned by the Executive as a result of employment by another employer or by insurance benefits after the date of termination, or otherwise.

            (b)       The provisions of this Agreement, and any payment provided for hereunder, shall not reduce any amounts otherwise payable, or in any way diminish the Executive’s existing rights, or rights which would accrue solely as a result of the passage of time, under any benefit plan of the Corporation or Partnership, or other
            contract, plan or arrangement.

             

            
                	
                             

                        	
                            5.

                        	
                            Other Activities During Employment.

                        

            

            5.1       The Executive shall not during the term of this Agreement undertake or engage in any other employment, occupation or business enterprise. Subject to compliance with the provisions of this Agreement, the Executive may engage in reasonable activities with respect to personal investments of the Executive.

            5.2       During the term of this Agreement, without the prior approval of the Board of Directors, neither the Executive nor any entity in which he may be interested as a partner, trustee, director, officer, employee, shareholder, option holder, lender of money or guarantor, shall be engaged directly or indirectly in any real estate
            development, leasing, marketing or management activities other than through the Corporation and the Partnership, except for activities existing on the date of this Agreement which have been disclosed to the Corporation; provided, however, that the foregoing shall not be deemed to (a) prohibit the Executive from being on the Board of Directors of another entity, (b) prevent the Executive from investing in securities if such class of securities in which the investment is so
            made is listed on a national securities exchange or is issued by a company registered under Section 12(g) of the Securities Exchange Act of 1934, so long as such investment holdings do not, in the aggregate, constitute more than 1% of the voting stock of any company’s securities or (c) prohibit passive investments, subject to any limitations contained in subparagraph (b) above.

            5.3       The Executive shall not at any time during this Agreement or after the termination hereof directly or indirectly divulge, furnish, use, publish or make accessible to any person or entity any Confidential Information (as hereinafter defined), except pursuant to subpoena, court order or applicable law. Any records of
            Confidential Information prepared by the Executive or which come into Executive’s possession during this Agreement are and remain the property of the Corporation or the Partnership, as the case may be, and upon termination of Executive’s employment all such records and copies thereof shall be either left with or returned to the Corporation or the Partnership, as the case may be.

            5.4       The term “Confidential Information” shall mean information disclosed to the Executive or known, learned, created or observed by Executive as a consequence of or through employment by the Corporation and the Partnership, not generally known in the relevant trade or industry, about the Corporation’s or the
            Partnership’s business activities, services and processes, including but not limited to information concerning advertising, sales promotion, publicity, sales data, research, copy, leasing, other printed matter, artwork, photographs, reproductions, layout, finances, accounting, methods, processes, business plans, contractors, lessee and supplier lists and records, potential lessee and supplier lists, and contractor, lessee or supplier billing.

            
                	
                             

                        	
                            6.

                        	
                            Post-Employment Activities.

                        

            

            6.1       During the term of employment hereunder, and for a period of six months after termination of employment, regardless of the reason for such termination other than by the Corporation or Partnership without Cause or by the Executive for Good Reason, the Executive shall not directly or indirectly become employed by, act as a
            consultant to, or otherwise render any services to any person, corporation, partnership or other entity which is engaged in, or about to become engaged in, the retail shopping center business or any other business which is competitive with the business of the Corporation, the Partnership or any of their subsidiaries nor shall Executive use Executive’s talents to make any such business competitive with the business of the Corporation, the Partnership or any of their
            subsidiaries.  For the purpose of this Section, a retail shopping center business or other business shall be deemed to be competitive if it involves the ownership, operation, leasing or management of any retail shopping centers which draw from the same related trade area, which is deemed to be within a radius of 10 miles from the location of (a) any then existing shopping centers of the Corporation, the Partnership or any of their subsidiaries or (b) any proposed
            centers for which the site is owned or under contract, is under construction or is actively being negotiated. The Executive shall be deemed to be directly or indirectly engaged in a business if Executive participates therein as a director, officer, stockholder, employee, agent, consultant, manager, salesman, partner or individual proprietor, or as an investor who has made advances or loans, contributions to capital or expenditures for the purchase of stock, or in any capacity or
            manner whatsoever; provided, however, that the foregoing shall not be deemed to prevent the Executive from investing in securities if such class of securities in which the investment is so made is listed on a national securities exchange or is issued by a company registered under Section 12(g) of the Securities Exchange Act of 1934, so long as such investment holdings do not, in the aggregate, constitute more than 1% of the voting stock of any company’s securities.

            6.2       The Executive acknowledges that Executive has been employed for Executive’s special talents and that Executive’s leaving the employ of the Corporation and the Partnership would seriously hamper the business of the Corporation and the Partnership. The Executive agrees that the Corporation and the Partnership
            shall each be entitled to injunctive relief, in addition to all remedies permitted by law, to enforce the provisions of Sections 5 and 6 hereof. The Executive further acknowledges that Executive’s training, experience and technical skills are of such breadth that they can be employed to advantage in other areas which are not competitive with the present business of the Corporation and the Partnership and consequently the foregoing obligation will not unreasonably impair
            Executive’s ability to engage in business activity after the termination of Executive’s present employment.

            6.3       The Executive will not, during the period of one year after termination of employment, regardless of the reason for such termination, hire or offer to hire or entice away or in any other manner persuade or attempt to persuade, either in Executive’s individual capacity or as agent for another, any of the
            Corporation’s, the Partnership’s or any of their subsidiaries’ officers, employees or agents to discontinue their relationship with the Corporation, the Partnership or any of their subsidiaries nor divert or attempt to divert from the Corporation, the Partnership or any of their subsidiaries any business whatsoever by influencing or attempting to influence any contractor, lessee or supplier of the Corporation, the Partnership or any of their
            subsidiaries.

            7.         Assignment. This Agreement shall inure to the benefit of and be binding upon the Corporation, the Partnership and their successors and assigns, and upon the Executive and Executive’s heirs, executors, administrators and legal representatives. The
            Corporation and the Partnership will require any successor or assign to all or substantially all of their business or assets to assume and perform this Agreement in the same manner and to the same extent that the Corporation and the Partnership would be required to perform if no such succession or assignment had taken place. This Agreement shall not be assignable by the Executive.

            8.         No Third Party Beneficiaries. This Agreement does not create, and shall not be construed as creating, any rights enforceable by any person not a party to this Agreement, except as provided in Section 7 hereof.

            9.         Headings. The headings of the sections hereof are inserted for convenience only and shall not be deemed to constitute a part hereof nor to affect the meaning thereof.

             

            10.       Interpretation. In case any one or more of the provisions contained in this Agreement shall, for any reason, be held to be invalid, illegal or unenforceable in any respect, such invalidity, illegality or unenforceability shall not affect any other provisions of this
            Agreement, and this Agreement shall be construed as if such invalid, illegal or unenforceable provisions had never been contained herein. If, moreover, any one or more of the provisions contained in this Agreement shall for any reason be held to be excessively broad as to duration, geographical scope, activity or subject, it shall be construed by limiting and reducing it, so as to be enforceable to the extent compatible with the applicable law as it shall then appear.

            11.       Notices. All notices under this Agreement shall be in writing and shall be deemed to have been given at the time when mailed by registered or certified mail, addressed to the address below stated of the party to which notice is given, or to such changed address as such
            party may have fixed by notice:

             

            
                	
                            To the Corporation

                            or the Partnership:

                        
	
                            Cedar Shopping Centers, Inc.

                            44 South Bayles Avenue

                            Port Washington, NY 11050

                            Attn: President

                        
	
                            To the Executive:

                        
	
                            Joel I. Yarmak

                            c/o Cedar Shopping Centers, Inc.

                            44 South Bayles Avenue

                            Port Washington, NY 11050

                        

            

             

            provided, however, that any notice of change of address shall be effective only upon receipt.

             

            12.       Waivers. If any party should waive any breach of any provision of this Agreement, he or it shall not thereby be deemed to have waived any preceding or succeeding breach of the same or any other provision of this Agreement.

            13.       Complete Agreement; Amendments. The foregoing is the entire agreement of the parties with respect to the subject matter hereof and may not be amended, supplemented, cancelled or discharged except by written instrument executed by the parties hereto.

            14.       Governing Law. This Agreement is to be governed by and construed in accordance with the laws of the State of New York without giving effect to principles of conflicts of law.

            15.       Counterparts. This Agreement may be executed in counterparts, all of which together shall constitute one agreement binding on all of the parties hereto, notwithstanding that all such parties are not signatories to the same counterpart.

            16.       Arbitration. Mindful of the high cost of litigation, not only in dollars but time and energy as well, the parties intend to and do hereby establish a quick, final and binding out-of-court dispute resolution procedure to be followed in the unlikely event any controversy
            should arise out of or concerning the performance of this Agreement. Accordingly, the parties do hereby covenant and agree that any controversy, dispute or claim of whatever nature arising out of, in connection with or in relation to the interpretation, performance or breach of this Agreement, including any claim based on contract, tort or statute, shall be settled, at the request of any party to this Agreement, through arbitration by a dispute resolution process administered by
            JAMS or any other mutually agreed upon arbitration firm involving final and binding arbitration conducted at a location determined by the arbitrator in New York City administered by and in accordance with the then existing rules of practice and procedure of such arbitration firm and judgment upon any award rendered by the arbitrator may be entered by any state or federal court having jurisdiction thereof; provided, however, that the Corporation and the Partnership shall be entitled
            to seek judicial relief to enforce the provisions of Sections 5 and 6 of this Agreement.

            17.       Indemnification. During this Agreement and thereafter, the Corporation and the Partnership shall indemnify the Executive to the fullest extent permitted by law against any judgments, fine, amounts paid in settlement and reasonable expenses (including attorneys’
            fees) in connection with any claim, action or proceeding (whether civil or criminal) against the Executive as a result of the Executive serving as an officer or director of the Corporation or the Partnership, in or with regard to any other entity, employee benefit plan or enterprise (other than arising out of the Executive’s act of willful misconduct, gross negligence, misappropriation of funds, fraud or breach of this Agreement). This indemnification shall be in addition to,
            and not in lieu of, any other indemnification the Executive shall be entitled to pursuant to the Corporation’s or Partnership’s Articles of Incorporation, By-Laws, Agreement of Limited Partnership or otherwise. Following the Executive’s termination of employment, the Corporation and the Partnership shall continue to cover the Executive under the then existing director’s and officer’s insurance, if any, for the period during which the Executive may be
            subject to potential liability for any claim, action or proceeding (whether civil or criminal) as a result of his service as an officer or director of the Corporation or the Partnership or in any capacity at the request of the Corporation or the Partnership, in or with regard to any other entity, employee benefit plan or enterprise on the same terms such coverage was provided during this Agreement, at the highest level then maintained for any then current or former officer or
            director.

             

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

             

            
                	
                            Cedar Shopping Centers, Inc.

                        
	   
	
                            By:/s/Leo S. Ullman       

                        
	
                            Title: President

                        
	    
	
                            Cedar Shopping Centers Partnership, L.P.

                        
	
                            By:       Cedar Shopping Centers, Inc.,

                                           General Partner

                        
	     
	
                            By:/s/Leo S. Ullman       

                        
	
                            Title: President

                        
	    
	
                            /s/Joel I. Yarmak       

                        
	
                            Joel I. Yarmak

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