EMPLOYMENT AGREEMENT

This EMPLOYMENT AGREEMENT (this “ Agreement ”) is made this 14th day of July 2009, by and between AGREE REALTY CORPORATION , a Maryland corporation (the “ Company ”), and RICHARD AGREE (the “Executive”).

WHEREAS , the Executive is expected to make certain contributions to the financial strength of the Company;

WHEREAS , the Company desires to assure itself of the continuity of management and desires to establish certain compensation rights of certain of its key senior executive officers, including the Executive; and

WHEREAS , the Company desires to employ the Executive and the Executive desires to accept such employment on the terms and conditions hereinafter set forth.

NOW, THEREFORE , in consideration of the mutual covenants hereinafter contained, the parties hereto hereby agree as follows:

1.            Employment; Term .  The Company hereby employs the Executive as Chief Executive Officer of the Company and the Executive agrees to serve the Company in such capacity for the period commencing on July 1, 2009 (the “ Effective Date ”) and ending on June 30, 2014 (the period during which the Executive is employed by the Company hereunder is referred to as the “ Employment Period ”); provided that, upon any expiration of the Employment Period, the Employment Period will automatically be extended for one year unless either the Company or Executive gives written notice of non-extension to the other at least 120 days prior to the expiration of the Employment Period.  The Executive shall also serve as Chairman of the Board of Directors of the Company (the “ Board ”) to the extent requested by the Board.

2.            Termination .  Subject to the terms and conditions set forth herein, the Executive’s employment may be terminated by either party hereto upon thirty (30) days’ written notice to the other party hereto.

3.            Duties .  The Executive shall be responsible for the supervision, control and conduct of all the business and affairs of the Company and shall have such additional duties and any additional responsibilities as are normally assigned to a Chief Executive Officer which may from time to time be reasonably designated by the Board, provided that the scope of his duties and the extent of his responsibilities shall not be substantially different from the duties and responsibilities customarily associated with such positions in a publicly-held corporation of similar size and business.  At all times, the Executive shall be subject to the direction of the Board.  During the Employment Period, the Executive shall devote his full business time and best efforts to the business and affairs of the Company and its subsidiaries.  Notwithstanding the foregoing, the Executive may: (i) engage in any civic or charitable activity for which the Executive receives de minimis compensation or other pecuniary advantage; (ii) invest his personal assets in any business that is not competitive with the Company or any of its subsidiaries, provided that such investment will not require any services on the part of the Executive which would unreasonably interfere with his obligations hereunder; (iii) purchase securities that are listed on a national securities exchange of any entity that is competitive with the Company or any of its subsidiaries, provided that the Executive may not beneficially own five percent (5%) or more of any class of such securities; (iv) serve as a director of up to three publicly traded entities that are not competitive with the Company or any of its subsidiaries; and (v) participate in any other activity approved in advance in writing by the Board.  For purposes of this Section 3 , a business or entity is “competitive in retail real estate” with the Company or any of its subsidiaries if such business or entity consists of or includes any type or line of business engaged in by the Company or any of its subsidiaries and such business is conducted, in whole or in part, within a one-hundred (100) mile radius of the Company’s principal executive headquarters.

4.            Compensation .  The Company shall pay the Executive a minimum salary of two hundred and eighty thousand dollars ($280,000.00)   per annum as compensation to the Executive for the services rendered by the Executive hereunder, including, but not limited to, all services rendered by the Executive as an officer or director of the Company and its subsidiaries.  Such compensation shall be payable in regular installments in accordance with the customary payroll practices of the Company.  The Compensation Committee shall review the Executive’s salary at least annually to determine whether the Executive’s salary shall be adjusted based on such criteria as the Compensation Committee shall from time to time establish.  For purposes of this Agreement, “ salary ” means the amount established and adjusted from time to time pursuant to this Section 4 .

5.            Benefits .

(a)           The Company agrees to reimburse the Executive for all reasonable and necessary travel, business entertainment and other business expenses incurred by the Executive in connection with the performance of his duties under this Agreement.  Such reimbursements shall be made by the Company on a timely basis, but no later than 60 days from the date such expenses are incurred, upon submission by the Executive of documentation in accordance with the Company’s standard procedures.  All such reimbursements shall be subject to reasonable limitations, which may from time to time be prescribed by the Board.  The reimbursement policies, practices and procedures applicable to Executive shall be the most favorable policies, practices and procedures of the Company relating to reimbursement of employment expenses incurred by Company directors, officers or employees in effect at any time during the twelve month period preceding the date Executive incurs the expenses.  The expense reimbursement or any in-kind benefits provided for any calendar year shall not affect the expenses eligible for reimbursement or any in-kind benefits provided in any other calendar year, and the Executive’s right to expense reimbursement or in-kind benefits cannot be liquidated or exchanged for any other benefit.

(b)           The Executive shall be entitled to participate in any and all life insurance, medical insurance, disability insurance, and other benefit plans which are made generally available during the Employment Period by the Company to executives of the Company, including, but not limited to, the Company’s 2005 Equity Incentive Plan, Profit Sharing Plan, performance Bonus Plan (to the extent that the Executive qualifies under the eligibility provisions of such plan or plans) or other similar plans.  Additionally, the Executive shall be entitled to receive annual paid vacation and paid holidays made available pursuant to Company policy to all of the executives of the Company.

6.            Termination .  The amounts described in Sections 6 and 7 hereof will be in lieu of any termination or severance payments required by the Company’s policies or applicable law (other than as required under applicable law), and will constitute Executive’s sole and exclusive rights and remedies with respect to the termination of Executive’s employment with the Company.  The Company may withhold from any payments hereunder all federal, state, city or other taxes to the extent required by applicable law.

(a)            Death; Disability .  In the event of the death or Disability of the Executive, the Executive’s employment hereunder shall terminate, and the Company shall pay to the Executive or the Executive’s personal representative or estate, as the case may be, in cash (i) any accrued and unpaid salary through the date of termination, (ii) any accrued and unpaid cash bonus with respect to the fiscal year preceding the termination, (iii) a pro-rata portion of the cash bonus with respect to the fiscal year in which the termination occurs, and (iv) any reimbursable expenses under Section 5(a) hereof that have not been reimbursed as of the date of termination. Subject to Section 19(d) hereof, the payments under this Section 6(a) shall be paid within ten (10) days of such termination.  In addition, all unvested securities of the Company issued to the Executive under the Company’s 2005 Equity Incentive Plan or any similar plan shall become fully vested as of the date of termination.

For purposes of this Agreement, “ Disability ” shall mean the inability of the Executive to engage in any substantial gainful activity by reason of any medically determinable physical or mental impairment that can be expected to result in death or can be expected to last for a continuous period of not less than 12 months.

For purposes of this Agreement, “ Bonus ” shall mean (i) the annual cash bonus from the Company plus (ii) the grant date fair value, in accordance with generally accepted accounting principles, of share-based compensation by the Company.

(b)            Good Reason or Other Than for Cause, Death or Disability .  Except with respect to a Change in Control (which is covered by Section 7 hereof), in the event that Executive’s employment is terminated by the Company for any reason other than death, Disability or Cause, or the Executive’s employment is terminated by Executive for Good Reason, the Company shall pay to the Executive in cash (i) any accrued and unpaid salary through the date of termination, (ii) any accrued and unpaid cash bonus with respect to the fiscal year preceding the termination, (iii) a pro-rata portion of the cash bonus with respect to the fiscal year in which the termination occurs, (iv) an amount equal to two (2) times Executive’s “compensation” (as defined in Section 7(b) hereof) , and (v) any reimbursable expenses under Section 5(a) hereof that have not been reimbursed as of the date of termination.  The Executive shall also continue to participate in all benefit plans made generally available by the Company to its executives for the remaining portion of the Employment Period (as if such termination had not occurred).  Subject to Section 19(d) hereof, the payments under clauses (i), (ii), (iii) and (v) hereof shall be paid within ten (10) days of such termination.  In addition, all unvested securities of the Company issued to the Executive under the Company’s 2005 Equity Incentive Plan or any similar plan shall become fully vested as of the date of such termination.

For purposes of this Agreement, “ Cause ” shall mean:  (i) the Executive’s willful failure or refusal to perform specific reasonable written directives of the Board, which directives are consistent with the scope and nature of the Executive’s duties and responsibilities under this Agreement, and which are not remedied by the Executive within sixty (60) days after written notice of his failure by the Board; (ii) a felony conviction of the Executive; (ii) any act of dishonesty involving the Company which results in a material unjust gain or enrichment to the Executive at the expense of the Company; (iv) any act involving moral turpitude of the Executive which materially and adversely affects the business of the Company; or (v) a material breach by the Executive of his obligations under Section 8 hereof.  No act or failure to act on the part of the Executive shall be deemed “willful” if it was due primarily to an error in judgment or negligence, but shall be deemed “willful” only if done or omitted to be done by the Executive not in good faith and without reasonable belief that his action or omission was in the best interests of the Company.

For purposes of this Agreement, “ Good Reason ” shall mean:  (i) a material breach of this Agreement by the Company; (2) other than for Cause, a material reduction in the nature or scope of the Executive’s title, authority, powers, functions, duties, or responsibilities; (3) other than for Cause or related to a general reduction that is not limited to any executive of the Company, a material reduction in the salary and Bonus paid to Executive or benefits provided to Executive; or (4) without Executive’s written consent, a transfer of the place of employment of more than thirty (30) miles from the Company’s principal executive headquarters.

(c)            Cause or Without Good Reason .  In the event Executive’s employment is terminated by the Company for Cause, or is terminated by Executive without Good Reason, the Company shall pay the Executive in cash (i) any accrued and unpaid salary through the date of termination, (ii) any accrued and unpaid cash bonus with respect to the fiscal year preceding the termination, and (iii) any reimbursable expenses under Section 5(a) hereof that have not been reimbursed as of the date of termination.  Subject to Section 19(d) hereof, the foregoing payments shall be made within ten (10) days of such termination.  Except as set forth in this Section 6(c) or as required by law, (i) any and all other benefits which the Executive would otherwise have been entitled to receive pursuant to the terms of this Agreement or applicable law shall be forfeited and (ii) any unvested securities of the Company issued to the Executive under the Company’s 2005 Equity Incentive Plan or any similar plan shall be forfeited.

The Executive shall not be deemed to have been terminated for Cause hereunder unless and until there shall have been delivered to the Executive a copy of a resolution duly adopted by the affirmative vote of not less than a majority of the Board then in office (excluding Executive or any immediate family member of Executive) at a meeting of the Board called and held for such purpose, after reasonable notice to the Executive and an opportunity for the Executive, together with his counsel (if the Executive chooses to have counsel present at such meeting), to be heard before the Board, finding that, in the good faith opinion of the Board, the Executive had committed an act constituting Cause as herein defined and specifying the particulars thereof in detail.

(d)            Retirement .  Notwithstanding any of the foregoing, if the Executive retires from employment with the Company at any time after he