HOME PROPERTIES INC
AMENDMENT THREE TO EXECUTIVE RETENTION PLAN
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<TYPE>EX-10.8
<SEQUENCE>9
<FILENAME>hme10q3qex108.htm
<DESCRIPTION>AMENDMENT THREE TO EXECUTIVE RETENTION PLAN
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    <div style="TEXT-ALIGN: right"><font style="FONT-WEIGHT: bold">Exhibit
10.8<br></font>

      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">HOME
PROPERTIES, INC.</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">HOME
PROPERTIES, L.P.</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">AMENDMENT
NUMBER THREE TO EXECUTIVE RETENTION PLAN</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 36pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">WHEREAS,
Home Properties, L.P., a New York limited partnership (the &#8220;Company&#8221;), Home
Properties, Inc., a Maryland corporation (&#8220;HME&#8221;) adopted that certain Executive
Retention Plan, as of February 2, 1999, as amended, (the &#8220;Plan&#8221;);
and</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 36pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">WHEREAS,
the Company and HME want to amend the Plan to take into account federal tax law
changes under Section 409A of the Internal Revenue Code of 1986, as amended, and
the regulations thereunder.</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 36pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">NOW
THEREFORE, the Company and HME hereby amend the Plan as follows, which shall be
effective as of the dates set forth below:</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 36pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; FONT-SIZE: 10pt">1.</font>&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;Subsection
2(j) (Good Reason) is amended by deleting this paragraph in its entirety and
replacing it with the following:</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 81pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><font id="TAB1" style="MARGIN-LEFT: 33.2pt"></font>(j)&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#8220;Good
Reason&#8221; with respect to the Officers means:&#160;&#160;(i) the assignment to the
Participant of any duties inconsistent in any respect with the Participant&#8217;s
position (including status, offices, titles and reporting requirements),
authority, duties or responsibilities as such authority, duties or
responsibilities were assigned to or exercised by the Participant immediately
prior to the Change in Control, or any other action by the Company which results
in a diminution in such position, authority, duties or responsibilities,
excluding for this purpose an isolated, insubstantial and inadvertent action not
taken in bad faith and which is remedied by the Company promptly after receipt
of notice thereof given by the Participant; (ii) the Company&#8217;s requiring
Participant to be based at any office or location more than 30 miles from the
location at which the Participant was principally employed prior to the Change
in Control; (iii) a material reduction by the Company of the Participant&#8217;s
compensation; or (iv) any failure by the Company to require any successor to the
Company to expressly assume and agree to perform this Plan as provided in
Section 8(c) of this Plan.&#160;&#160;In no event will a Participant have a Good
Reason to resign if the Participant resigns more than one year following the
initial existence of the Good Reason condition.</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 81pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><font id="TAB1" style="MARGIN-LEFT: 33.2pt"></font>&#8220;Good Reason&#8221; with respect to members
of the Corporate Staff and Other Senior Staff means: (i) a material reduction,
without the Participant&#8217;s written consent, of the Participant&#8217;s duties,
responsibilities, and authority from the Participant&#8217;s duties, responsibilities,
and authority as in effect&#8217; immediately prior to the Change in Control; (ii) the
Company&#8217;s requiring Participant to be based at any office or location more than
30 miles from the location at which the Participant was principally employed
prior to the Change in Control; (iii) a material reduction by the Company of the
Participant&#8217;s base compensation or incentive compensation opportunity; or (iv)
any failure by the Company to require any successor to the Company to expressly
assume and agree to perform this Plan as provided in Section 8(c) of this
Plan.&#160;&#160;&#160;In no event will a Participant have a Good Reason to
resign if the Participant resigns more than one year following the initial
existence of the Good Reason condition.</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 81pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">A new
Subsection 2(p) (Section 409A) is added as follows, and the current Subsections
2(p) (Termination Date) through 2(r) (Window Period) are renumbered
accordingly:</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 81pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><font id="TAB2" style="LETTER-SPACING: 9pt">&#160;&#160;&#160;</font>&#160;(p)&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#8220;Section
409A&#8221; means Section 409A of the Internal Revenue Code of 1986, as amended, and
the Treasury Regulations and other authoritative guidance issues
thereunder.</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 36pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; FONT-SIZE: 10pt">2.</font>&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;Subsection
3(a) is amended by deleting the current subsection in its entirety and replacing
it with the following:</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 72pt; TEXT-INDENT: 36pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">(a)&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;<font style="DISPLAY: inline; TEXT-DECORATION: underline">Officers</font>.&#160;&#160;In
the event the employment of an Officer is terminated on or after the Effective
Date and during the two-year period following such Effective Date by the Company
without Cause or by the Officer for Good Reason, or if such employment is
terminated by the Officer during the Window Period for any reason, the Company
shall pay to the Officer in a lump sum in cash within 30 days after the
Termination Date the aggregate of the following amounts: (i) the Officer&#8217;s Base
Salary through the Termination Date to the extent not theretofore paid, (ii) all
other amounts earned, accrued or deferred under the Bonus Plan, (iii) two times
the Officer&#8217;s Base Salary, (iv) an amount equal to two times the last bonus
which was awarded to the Officer under the Bonus Plan, and (v) the Gross-Up
Amount.</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 36pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; FONT-SIZE: 10pt">3.</font>&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;Subsection
3(b) is amended by deleting the current subsection in its entirety and replacing
it with the following:</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 72pt; TEXT-INDENT: 36pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">(b)&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;<font style="DISPLAY: inline; TEXT-DECORATION: underline">Members of Corporate
Staff</font>.&#160;&#160;In the event the employment of a member of Corporate
Staff is terminated on or after the Effective Date and during the two-year
period following such Effective Date by the Company without Cause or by the
Corporate Staff member for Good Reason, the Company shall pay to the Corporate
Staff member in a lump sum in cash within 30 days after the Termination Date the
aggregate of the following amounts: (i) the Corporate Staff member&#8217;s Base Salary
through the Termination Date to the extent not theretofore paid, (ii) all other
amounts earned, accrued or deferred under the Bonus Plan, (iii) at the option of
the Corporate Staff member, the lesser of (y) two times the Officer&#8217;s Base
Salary, or (z) 2.99 multiplied by the average of the Corporate Staff member&#8217;s
Base Salary for the five years preceding the Termination Date (or such lesser
period as such Corporate Staff member shall have been an employee of the
Company) or such other amounts as may be determined to be an amount which would
not trigger the Excise Tax, and (iv) an amount equal to two times the last bonus
which was awarded to the Corporate Staff member under the Bonus
Plan.</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 36pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; FONT-SIZE: 10pt">4.</font>&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;Subsection
3(c) is amended by deleting the current subsection in its entirety and replacing
it with the following:</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 72pt; TEXT-INDENT: 36pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">(c)&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;<font style="DISPLAY: inline; TEXT-DECORATION: underline">Other Senior
Staff</font>.&#160;&#160;In the event the employment of an Other Senior Staff
member is terminated on or after the Effective Date by the Company without
Cause, or by the Corporate Staff member for Good Reason, the Company shall pay
to the member of Other Senior Staff member in a lump sum in cash within 30 days
after the Termination Date the aggregate of the following amounts: (i) the Other
Senior Staff member&#8217;s Base Salary through the Termination Date to the extent not
theretofore paid, (ii) all other amounts earned, accrued or deferred under the
Bonus Plan, and (iii) an amount equal to one month&#8217;s Base Salary for each year
such member of Other Senior Staff was employed by the Company (or a predecessor
entity for which such Other Senior Staff member is given service credit for
purposes of one or more of the Employee Benefit Plans), with a minimum of two
month&#8217;s Base Salary and a maximum of twenty-four month&#8217;s Base
Salary.</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div id="PGBRK" style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt">
        <div id="FTR">&#160;</div>
      </div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 36pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">5.&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;Section
7 (Certain Additional Payments by the Company) is amended by adding the
following new Subsection (e) to the end thereof:</font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      </div>
      <div style="DISPLAY: block; MARGIN-LEFT: 72pt; TEXT-INDENT: 36pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">(e)&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;Notwithstanding
any other provision of this Plan to the contrary, any Gross-Up payment required
under this Section shall be paid within the time period prescribed by Section
409A for making such payments, which generally requires that such payment be
made no later than the end of the calendar year following the calendar year when
the Participant remits the Excise Tax.</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 36pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; FONT-SIZE: 10pt">6.</font>&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;Section
9(b) is amended by deleting the last sentence therein and replacing it with the
following:</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 72pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Payments
for legal fees and expenses shall be made by the Company within five business
days after delivery of the Participant&#8217;s written request for such payment
accompanied by reasonably detailed evidence of such fee and expenses, provided
that the Participant shall have submitted such written request for reimbursement
at least 30 days before the end of the calendar year next following the calendar
year in which such fees and expenses were incurred.</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 36pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; FONT-SIZE: 10pt">7.</font>&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;Section
9 is amended by adding the following new Subsection (g) to the end
thereof:</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 72pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><font id="TAB2" style="LETTER-SPACING: 9pt">&#160;&#160;&#160;</font>&#160;(g)&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;<font style="DISPLAY: inline; TEXT-DECORATION: underline">Section
409A</font>.&#160;&#160;The timing of all payments and benefits under this Plan
shall be made consistent with the requirements of Section
409A.&#160;&#160;Therefore, notwithstanding any provision in the Plan to the
contrary, in the event that a Participant is a &#8220;specified employee&#8221; (as defined
in Section 409A), any benefit or amount described in the Plan shall be delayed
until the date which is the first day of the seventh month after the date of
such Participant&#8217;s termination of employment (or, if earlier, the date of such
Participant&#8217;s death), if paying such amount or benefit prior to that date would
violate Section 409A.&#160;&#160;To the extent that payments under this
Agreement are subject to Section 409A, this Agreement shall be governed by and
subject to the requirements of Section 409A and shall be interpreted and
administered in accordance with that intent.&#160;&#160;If any provision of this
Agreement would otherwise conflict with or frustrate this intent, that provision
will be interpreted and deemed amended so as to avoid the conflict.</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 36pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Approved
by Board of Directors</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 36pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">October
29, 2008</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 36pt; MARGIN-RIGHT: 0pt; TEXT-ALIGN: center" align="justify">2<font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">&#160;</font></div>
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