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<SEC-DOCUMENT>0000899681-07-000301.txt : 20070425
<SEC-HEADER>0000899681-07-000301.hdr.sgml : 20070425
<ACCEPTANCE-DATETIME>20070425100123
ACCESSION NUMBER:		0000899681-07-000301
CONFORMED SUBMISSION TYPE:	DEF 14A
PUBLIC DOCUMENT COUNT:		1
CONFORMED PERIOD OF REPORT:	20070612
FILED AS OF DATE:		20070425
DATE AS OF CHANGE:		20070425
EFFECTIVENESS DATE:		20070425

FILER:

	COMPANY DATA:	
		COMPANY CONFORMED NAME:			CEDAR SHOPPING CENTERS INC
		CENTRAL INDEX KEY:			0000761648
		STANDARD INDUSTRIAL CLASSIFICATION:	REAL ESTATE INVESTMENT TRUSTS [6798]
		IRS NUMBER:				421241468
		STATE OF INCORPORATION:			MD
		FISCAL YEAR END:			1231

	FILING VALUES:
		FORM TYPE:		DEF 14A
		SEC ACT:		1934 Act
		SEC FILE NUMBER:	001-31817
		FILM NUMBER:		07786294

	BUSINESS ADDRESS:	
		STREET 1:		44 SOUTH BAYLES AVENUE
		CITY:			PORT WASHINGTON
		STATE:			NY
		ZIP:			11050
		BUSINESS PHONE:		5167676492

	MAIL ADDRESS:	
		STREET 1:		44 SOUTH BAYLES AVENUE
		CITY:			PORT WASHINGTON
		STATE:			NY
		ZIP:			11050

	FORMER COMPANY:	
		FORMER CONFORMED NAME:	CEDAR INCOME FUND LTD /MD/
		DATE OF NAME CHANGE:	20001128

	FORMER COMPANY:	
		FORMER CONFORMED NAME:	UNI INVEST USA LTD
		DATE OF NAME CHANGE:	20000407

	FORMER COMPANY:	
		FORMER CONFORMED NAME:	CEDAR INCOME FUND LTD
		DATE OF NAME CHANGE:	19920703
</SEC-HEADER>
<DOCUMENT>
<TYPE>DEF 14A
<SEQUENCE>1
<FILENAME>cedar-def14a_042407.htm
<TEXT>
<HTML>
<HEAD>
<TITLE>DEF 14A</TITLE>
</HEAD>
<BODY>

<!-- MARKER FORMAT-SHEET="Stroock Head Minor Center" FSL="Workstation" -->
<P ALIGN=CENTER><FONT SIZE=3>SECURITIES AND EXCHANGE COMMISSION</FONT></P>

<!-- MARKER FORMAT-SHEET="Stroock Head Minor Center" FSL="Workstation" -->
<P ALIGN=CENTER><FONT SIZE=3>Washington, D.C. 20549</FONT></P>

<!-- MARKER FORMAT-SHEET="Stroock Head Minor Center" FSL="Workstation" -->
<P ALIGN=CENTER><FONT SIZE=3>SCHEDULE 14A INFORMATION</FONT></P>

<!-- MARKER FORMAT-SHEET="Stroock Head Minor Center" FSL="Workstation" -->
<P ALIGN=CENTER><FONT SIZE=3>Proxy Statement Pursuant to Section 14(a) of the Securities<BR>
Exchange Act of 1934<BR>
[(Amendment No. ___)]</FONT></P>

<!-- MARKER FORMAT-SHEET="Stroock Head Left" FSL="Default" -->
<P ALIGN=LEFT><FONT SIZE=3>Filed by the Registrant [X]<BR>
Filed by a Party other than the Registrant [   ]</FONT></P>

<!-- MARKER FORMAT-SHEET="Stroock Para Flush" FSL="Workstation" -->
<P><FONT SIZE=3>Check the appropriate box: </FONT></P>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT>[&nbsp;&nbsp;&nbsp;]<BR>
[&nbsp;&nbsp;&nbsp;]<BR>
<BR>
[X]<BR>
[&nbsp;&nbsp;&nbsp;]<BR>
[&nbsp;&nbsp;&nbsp;]</TD>
<TD WIDTH=2% ALIGN=LEFT>&nbsp;&nbsp;</TD>
<TD WIDTH=93% ALIGN=LEFT>Preliminary Proxy Statement<BR>
Confidential, for Use of the Commission Only<BR>
(as permitted by Rule 14a-6(e)(2))<BR>
Definitive Proxy Statement<BR>
Definitive Additional Materials<BR>
Soliciting Material Pursuant to ss.240.14a-11(c)or ss. 240.14a-12</TD>
</TR>
</TABLE>
<BR>
<BR>
<BR>
<CENTER><FONT SIZE=3>CEDAR SHOPPING CENTERS, INC.<BR>
<HR SIZE=1 NOSHADE>
(Name of Registrant as Specified in Its Charter)
<BR>
<BR>
<BR>
<HR SIZE=1 NOSHADE>
(Name of Person(s) Filing Proxy Statement, if other than the Registrant)</FONT></CENTER>

<!-- MARKER FORMAT-SHEET="Stroock Para Flush" FSL="Workstation" -->
<P><FONT SIZE=3>Payment of Filing Fee (Check the appropriate box): </FONT></P>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT>[X]<BR>
[&nbsp;&nbsp;&nbsp;]</TD>
<TD WIDTH=95% ALIGN=LEFT>No fee required<BR>
Fee computed on table below per Exchange Act Rules 14a-6(i)(4) and 0-11.</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT>&nbsp;&nbsp;</TD>
<TD WIDTH=5% ALIGN=LEFT>(1)<BR>
(2)<BR>
(3)<BR>
<BR>
<BR>
(4)<BR>
(5)<BR></TD>
<TD WIDTH=90% ALIGN=LEFT>Title of each class of secruties to which transaction applies:_________________________<BR>
Aggregate number of securities to which transaction applies:________________________<BR>
Per unit price or other underlying value of transaction computed pursuant to Exchange Act Rule
0-11 (set forth the amount on which the filing fee is calculated and state how it was determined):
_________________________________________________________________________________________<BR>
Proposed maximum aggregate value of transaction:_______________________________<BR>
Total fee paid:___________________________________________________________</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT>[&nbsp;&nbsp;&nbsp;]<BR>
[&nbsp;&nbsp;&nbsp;]</TD>
<TD WIDTH=95% ALIGN=LEFT>Fee previously paid with preliminary materials.<BR>
Check box if any part of the fee is offset as provided by Exchange Act Rule 0-11(a)(2)
and identify the filing for which the offsetting fee was paid previously.  Identify the previous
filing by registration statement number, or the Form or Schedule and the date of its filing. </TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT>&nbsp;&nbsp;</TD>
<TD WIDTH=5% ALIGN=LEFT>(1)<BR>
(2)<BR>
(3)<BR>
(4)</TD>
<TD WIDTH=90% ALIGN=LEFT>Amount Previously Paid:_______________________<BR>
Form, Schedule or Registration Statement No.:__________________________<BR>
Filing Party:_________________________________<BR>
Date Filed:__________________________________ </TD>
</TR>
</TABLE>
<BR>
<PAGE>

<!-- MARKER FORMAT-SHEET="Stroock Head Major Center Bold" FSL="Default" -->
<P ALIGN=CENTER><FONT SIZE=3><B>CEDAR SHOPPING CENTERS, INC. </B></FONT></P>

<!-- MARKER FORMAT-SHEET="Center Rule" FSL="Default" -->
     <P ALIGN=CENTER>_________________ </P>

<!-- MARKER FORMAT-SHEET="Stroock Head Major Center Bold" FSL="Workstation" -->
<P ALIGN=CENTER><FONT SIZE=3><B>NOTICE OF ANNUAL MEETING OF STOCKHOLDERS<BR>
TO BE HELD JUNE 12, 2007 </B></FONT></P>

<!-- MARKER FORMAT-SHEET="Center Rule" FSL="Default" -->
     <P ALIGN=CENTER>_________________ </P>

<!-- MARKER FORMAT-SHEET="Para Large Indent" FSL="Default" -->
<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;NOTICE
IS HEREBY GIVEN that the Annual Meeting of Stockholders of Cedar Shopping Centers, Inc.
(the &#147;Company&#148;) will be held at the offices of Stroock &amp; Stroock &amp; Lavan
LLP, 180 Maiden Lane, 34th Floor, New York, NY 10038, on Tuesday, June 12, 2007 at 4:00 in
the afternoon for the following purposes: </FONT></P>

<!-- MARKER FORMAT-SHEET="Para (List) Hang Level 3" FSL="Default" -->
     <TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0>
          <TR VALIGN=TOP>
          <TD ALIGN=RIGHT WIDTH=5%><FONT SIZE=3> </FONT></TD>
          <TD ALIGN=LEFT WIDTH=5%><FONT SIZE=3>1.</FONT></TD>
          <TD WIDTH=90%><P ALIGN=LEFT><FONT SIZE=3>
          To elect seven Directors. </FONT></P></TD>
          </TR>
          </TABLE>
          <BR>

<!-- MARKER FORMAT-SHEET="Para (List) Hang Level 3" FSL="Default" -->
     <TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0>
          <TR VALIGN=TOP>
          <TD ALIGN=RIGHT WIDTH=5%><FONT SIZE=3> </FONT></TD>
          <TD ALIGN=LEFT WIDTH=5%><FONT SIZE=3>2. </FONT></TD>
          <TD WIDTH=90%><P ALIGN=LEFT><FONT SIZE=3>
          To authorize and approve an amendment to the Articles of Incorporation to
          increase the number of authorized shares of common stock and preferred stock of
          the Company. </FONT></P></TD>
          </TR>
          </TABLE>
          <BR>

<!-- MARKER FORMAT-SHEET="Para (List) Hang Level 3" FSL="Default" -->
     <TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0>
          <TR VALIGN=TOP>
          <TD ALIGN=RIGHT WIDTH=5%><FONT SIZE=3> </FONT></TD>
          <TD ALIGN=LEFT WIDTH=5%><FONT SIZE=3>3. </FONT></TD>
          <TD WIDTH=90%><P ALIGN=LEFT><FONT SIZE=3>
          To approve the appointment of Ernst &amp; Young LLP as the independent
          registered public accounting firm of the Company for the fiscal year ending
          December 31, 2007. </FONT></P></TD>
          </TR>
          </TABLE>
          <BR>

<!-- MARKER FORMAT-SHEET="Para (List) Hang Level 3" FSL="Default" -->
     <TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0>
          <TR VALIGN=TOP>
          <TD ALIGN=RIGHT WIDTH=5%><FONT SIZE=3> </FONT></TD>
          <TD ALIGN=LEFT WIDTH=5%><FONT SIZE=3>4.</FONT></TD>
          <TD WIDTH=90%><P ALIGN=LEFT><FONT SIZE=3>
          To transact such other business as may properly come before the meeting, or any
          adjournment thereof. </FONT></P></TD>
          </TR>
          </TABLE>
          <BR>

<!-- MARKER FORMAT-SHEET="Para Large Indent" FSL="Default" -->
<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Stockholders
of record at the close of business on April 20, 2007, shall be entitled to notice of, and
to vote at, the meeting. </FONT></P>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=50%></TD>
<TD WIDTH=50%>By order of the Board of Directors<BR>
<BR>
<BR>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Leo S. Ullman<BR>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<I>Chairman of the Board</I></TD>
</TR>
</TABLE>
<BR>

<!-- MARKER FORMAT-SHEET="Stroock Head Left" FSL="Default" -->
<P ALIGN=LEFT><FONT SIZE=3>Dated:&nbsp;April 27, 2007<BR>
Port Washington, NY</FONT></P>

<!-- MARKER FORMAT-SHEET="Para Large Indent" FSL="Workstation" -->
<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;IMPORTANT:
PLEASE FILL IN, DATE, SIGN AND MAIL PROMPTLY THE ENCLOSED PROXY IN THE POSTAGE-PAID
ENVELOPE PROVIDED TO ENSURE THAT YOUR SHARES ARE REPRESENTED AT THE MEETING. </FONT></P>

<!-- MARKER FORMAT-SHEET="Stroock Head Major Center Bold" FSL="Workstation" -->
<P ALIGN=CENTER><FONT SIZE=3><B>CEDAR SHOPPING CENTERS, INC.<BR>
44 SOUTH BAYLES AVENUE<BR>
PORT WASHINGTON, NEW YORK 11050 </B></FONT></P>

<!-- MARKER FORMAT-SHEET="Center Rule" FSL="Default" -->
     <P ALIGN=CENTER>_________________ </P>

<!-- MARKER FORMAT-SHEET="Stroock Head Major Center Bold" FSL="Default" -->
<P ALIGN=CENTER><FONT SIZE=3><B>PROXY STATEMENT </B></FONT></P>

<!-- MARKER FORMAT-SHEET="Center Rule" FSL="Default" -->
     <P ALIGN=CENTER>_________________ </P>

<!-- MARKER FORMAT-SHEET="Para Large Indent" FSL="Default" -->
<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
accompanying Proxy is solicited by the Board of Directors of Cedar Shopping Centers, Inc.,
a Maryland corporation (the &#147;Company&#148;), for use at the Annual Meeting of
Stockholders (the &#147;Meeting&#148;) to be held on June 12, 2007, at 4:00 in the
afternoon, or any adjournment thereof, at which stockholders of record at the close of
business on April 20, 2007 shall be entitled to vote. The cost of solicitation of proxies
will be borne by the Company. The Company has retained The Altman Group, Inc. to assist in
the solicitation of proxies for a fee not to exceed $25,000, plus out-of-pocket expenses.
The Company also may use the services of its directors, officers, employees and others to
solicit proxies, personally or by telephone; arrangements may also be made with brokerage
houses and other custodians, nominees, fiduciaries and stockholders of record to forward
solicitation material to the beneficial owners of stock held of record by such persons.
The Company may reimburse such solicitors for reasonable out-of-pocket expenses incurred
by them in soliciting, but no compensation will be paid for their services. </FONT></P>

<!-- MARKER FORMAT-SHEET="Para Large Indent" FSL="Default" -->
<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Each
proxy executed and returned by a stockholder may be revoked at any time before it is voted
by timely submission of written notice of revocation or by submission of a duly executed
proxy bearing a later date (in either case directed to the Secretary of the Company) or,
if a stockholder is present at the Meeting, he may elect to revoke his proxy and vote his
shares personally. </FONT></P>

<!-- MARKER FORMAT-SHEET="Para Large Indent" FSL="Default" -->
<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
Company&#146;s Annual Report to Stockholders for the fiscal year ended December 31, 2006
is being mailed herewith to each stockholder of record. The financial statements in such
Annual Report are incorporated herein by reference. It is intended that this Proxy
Statement and form of Proxy will first be sent or given to stockholders on or about April
27, 2007. The Company&#146;s website address is www.cedarshoppingcenters.com. </FONT></P>

<!-- MARKER FORMAT-SHEET="Para Large Indent" FSL="Default" -->
<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;On
April 20, 2007, the Company had outstanding and entitled to vote with respect to all
matters to be acted upon at the meeting, 43,599,665 shares of Common Stock. Each holder of
Common Stock is entitled to one vote for each share of stock held by such holder. The
presence of holders representing a majority of all the votes entitled to be cast at the
meeting will constitute a quorum at the meeting. In accordance with Maryland law,
abstentions, but not broker non-votes, are counted for purposes of determining the
presence or absence of a quorum for the transaction of business. Each item on the agenda,
except for proposal 2, must receive the affirmative vote of a majority of the shares of
Common Stock voted at the meeting in order to pass. Proposal 2 on the agenda must receive
the affirmative vote of the holders of at least two-thirds of the outstanding shares of
Common Stock entitled to vote thereon at the meeting in order to be approved. Abstentions
and broker non-votes are not counted in determining the votes cast with respect to any of
the matters submitted to a vote of stockholders. </FONT></P>

<!-- MARKER FORMAT-SHEET="Para Large Indent" FSL="Default" -->
<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;It
is expected that the following business will be considered at the meeting and action taken
thereon: </FONT></P>

<!-- MARKER FORMAT-SHEET="Head Major Left Bold" FSL="Default" -->
<H1 ALIGN=CENTER><FONT SIZE=3>1. ELECTION OF DIRECTORS </FONT></H1>

<!-- MARKER FORMAT-SHEET="Para Large Indent" FSL="Default" -->
<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Pursuant
to the Certificate of Incorporation and Bylaws, as amended, the director nominees elected
at this Meeting will be elected to serve one-year terms that expire upon the date of the
next annual meeting or until their respective successors are duly elected and qualified. </FONT></P>

<!-- MARKER FORMAT-SHEET="Para Large Indent" FSL="Default" -->
<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;It
is intended that the accompanying form of Proxy will be voted for the nominees set forth
below, each of whom is presently a director of the Company. If some unexpected occurrence
should make necessary, in the Board of Directors&#146; judgment, the substitution of some
other person or persons for these nominees, shares will be voted for such other persons as
the Board of Directors may select. </FONT></P>

<!-- MARKER FORMAT-SHEET="Para Large Indent" FSL="Workstation" -->
<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
Board of Directors is not aware that any nominee may be unable or unwilling to serve as a
director. The following table sets forth certain information with respect to the nominees. </FONT></P>

<!-- MARKER FORMAT-SHEET="Stroock Head Major Center Bold" FSL="Default" -->
<P ALIGN=CENTER><FONT SIZE=3><B>NOMINEES FOR ELECTION </B></FONT></P>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=20% ALIGN=LEFT><BR>
<BR>
<U>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>Name</B>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</U> </TD>
<TD WIDTH=10%><BR>
<BR>
<U>&nbsp;&nbsp;<B>Age</B>&nbsp;&nbsp;</U>  </TD>
<TD WIDTH=45% ALIGN=CENTER><BR>
<B>Principal Occupation and <BR>
<U>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Positions Held
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</U></B>
</TD>
<TD WIDTH=5%> </TD>
<TD WIDTH=20%>
<B>Served as a<BR>
Director<BR>
<U>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Since&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</U></B> </TD>
</TR>
</TABLE>
<BR>
<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=20% ALIGN=LEFT>James J. Burns  </TD>
<TD WIDTH=10%>67</TD>
<TD WIDTH=45% ALIGN=LEFT>
Mr. Burns, a director since 2001 and a member of the Audit (Chair), Compensation
and Nominating/Corporate Governance Committees, has been vice chairman of
Wellsford Real Properties, Inc. since March 2006 and had been chief financial
officer and senior vice president of Wellsford Real Properties, Inc. from
December 2000 until March 2006. He joined Wellsford in October 1999 as chief
accounting officer upon his retirement from Ernst &amp; Young LLP in September 1999.
At Ernst &amp; Young LLP, Mr. Burns was a senior audit partner in the E&amp;Y Kenneth
Leventhal Real Estate Group for 22 years. Since 2000, Mr. Burns has also served
as a director of One Liberty Properties, Inc., a REIT listed on the New York
Stock Exchange. Mr. Burns is a certified public accountant and a member of the
American Institute of Certified Public Accountants. Mr. Burns received B.A and
M.B.A. degrees from Baruch College of the City University of New York.</TD>
<TD WIDTH=5%> </TD>
<TD WIDTH=20%> 2001
 </TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=20% ALIGN=LEFT>Richard Homburg  </TD>
<TD WIDTH=10%>58</TD>
<TD WIDTH=45% ALIGN=LEFT>Mr. Homburg, a director since 1999, and chairman from November 1999 to August
2000, was born and educated in the Netherlands. Mr. Homburg was the president
and CEO of Uni-Invest N.V., a publicly-listed Dutch real estate fund, from 1991
until 2000. In 2002, an investment group purchased 100% of the shares of
Uni-Invest N.V., taking it private, at which time it was one of the largest real
estate funds in the Netherlands with assets of approximately $2.5 billion CDN.
Mr. Homburg is chairman and CEO of Homburg Invest Inc. and president of Homburg
Invest USA Inc. (a wholly-owned subsidiary of Homburg Invest Inc.). In addition
to his varied business interests, Mr. Homburg has served on many boards.
Previous positions held by Mr. Homburg include president and director of the
Investment Property Owners of Nova Scotia, Evangeline Trust and World Trade
Center in Eindhoven, the Netherlands, as well as director or advisory board
member of other large charitable organizations. Mr. Homburg holds an honorary
Doctorate in Commerce from St. Mary's University in Canada, and was named 2004
Entrepreneur of the Year for the Atlantic Provinces by Ernst &amp; Young LLP.</TD>
<TD WIDTH=5%> </TD>
<TD WIDTH=20%>2002
 </TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=20% ALIGN=LEFT>Paul G. Kirk, Jr.</TD>
<TD WIDTH=10%>69</TD>
<TD WIDTH=45% ALIGN=LEFT>Mr. Kirk, a director since September 2005 and a member of the
Nominating/Corporate Governance (Chair) and Compensation Committees, is a retired partner
of the law firm of Sullivan &amp; Worcester, LLP of Boston, MA. He was a member of the
firm from 1977 through 1990. He also serves as Chairman and CEO of Kirk &amp; Associates,
Inc., a business advisory and consulting firm. Mr. Kirk also currently serves on the Board
of Directors of the Hartford Financial Services Group, Inc. and Rayonier, Incorporated (a
real estate investment trust listed on the New York Stock Exchange). He has previously
served on the Boards of Directors of ITT Corporation (1989-1997) and of Bradley Real
Estate, Inc. (1991-2000), a real estate investment trust that was subsequently acquired by
Heritage Property Investment Trust, Inc. Mr. Kirk also serves as Chairman of the Board of
Directors of the John F. Kennedy Library Foundation and was a founder and continues to
serve as co-chairman of the Commission on Presidential Debates. From 1985 to 1989, Mr.
Kirk served as Chairman of the Democratic Party of the U.S., and from 1983-1985 as its
Treasurer. A graduate of Harvard College and Harvard Law School, Mr. Kirk is past-Chairman
of the Harvard Board of Overseers&#146; Nominating Committee and currently serves as
Chairman of the Harvard Board of Overseers&#146; Committee to Visit the Department of
Athletics. He has received many awards for civic leadership and public service, including
honorary doctors of law degrees from Stonehill College and the Southern New England School
of Law.</TD>
<TD WIDTH=5%> </TD>
<TD WIDTH=20%> 2005 </TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=20% ALIGN=LEFT>Everett B. Miller, III  </TD>
<TD WIDTH=10%>61</TD>
<TD WIDTH=45% ALIGN=LEFT>Mr. Miller, a director since 1998 and a member of the Audit and Compensation
Committees, is vice president of alternative investments at YMCA Retirement
Fund. In March 2003, Mr. Miller was appointed to the Real Estate Advisory
Committee of the New York State Common Retirement Fund. Prior to his retirement
in May 2002 from Commonfund Realty, Inc., a registered investment advisor, Mr.
Miller was the chief operating officer of that company from 1997 until May 2002.
From January 1995 through March 1997, Mr. Miller was the Principal Investment
Officer for Real Estate and Alternative Investment at the Office of the
Treasurer of the State of Connecticut. Prior thereto, Mr. Miller was employed
for eighteen years at affiliates of Travelers Realty Investment Co., at which
his last position was senior vice president. Mr. Miller received a B.S. from
Yale University.</TD>
<TD WIDTH=5%> </TD>
<TD WIDTH=20%>1998
 </TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=20% ALIGN=LEFT>Leo S. Ullman    </TD>
<TD WIDTH=10%>67</TD>
<TD WIDTH=45% ALIGN=LEFT>Mr. Ullman, chief executive officer, president and chairman of the board
of directors, has been involved in real estate property and asset management for more than
twenty-five years. He was chairman and president since 1978 of the real estate management
companies which were merged into the Company in 2003, and their respective predecessors
and affiliates. Mr. Ullman was first elected as the Company&#146;s chairman in April 1998
and served until November 1999. He was re-elected in December 2000. Mr. Ullman also has
been chief executive officer and president from April 1998 to date. He has been a member
of the New York Bar since 1966 and was in private legal practice until 1998. From 1984
until 1993, he was a partner in the New York law firm of Reid &amp; Priest (now Thelen
Reid Brown Raysman &amp; Steiner LLP), and served as initial director of its real estate
group. Mr. Ullman received an A.B. from Harvard University, an M.B.A. from the Columbia
University Graduate School of Business and a J.D. from the Columbia University School of
Law where he was a Harlan Fiske Stone scholar. He has lectured and written several books,
monographs and articles on investment in U.S. real estate, and is a former adjunct
professor of business at the NYU Graduate School of Business.</TD>
<TD WIDTH=5%> </TD>
<TD WIDTH=20%>1998
 </TD>
</TR>
</TABLE>
<BR>

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<TR VALIGN=TOP>
<TD WIDTH=20% ALIGN=LEFT>Brenda J. Walker  </TD>
<TD WIDTH=10%>54</TD>
<TD WIDTH=45% ALIGN=LEFT>Ms. Walker has been vice president and director since 1998, and was treasurer
from April 1998 until November 1999. She has been involved in real estate -
related finance, property and asset management for more than 20 years. She was
an executive officer since 1992 of the real estate management companies which
were merged into the Company in 2003, and their respective predecessors and
affiliates. Ms. Walker received a B.A. from Lincoln University.</TD>
<TD WIDTH=5%> </TD>
<TD WIDTH=20%> 1998
 </TD>
</TR>
</TABLE>
<BR>

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<TR VALIGN=TOP>
<TD WIDTH=20% ALIGN=LEFT>Roger M. Widmann </TD>
<TD WIDTH=10%>67</TD>
<TD WIDTH=45% ALIGN=LEFT>Mr. Widmann, a director since October 2003 and a member of the Audit,
Compensation (Chair), and Nominating/Corporate Governance Committees, is an investment
banker. He was a principal of the investment banking firm of Tanner &amp; Co., Inc. from
1997 to 2004. From 1986 to 1995, Mr. Widmann was a senior managing director of Chemical
Securities, Inc., a subsidiary of Chemical Banking Corporation (now JPMorgan Chase
Corporation). Prior to joining Chemical Securities, Inc., Mr. Widmann was a founder and
managing director of First Reserve Corporation, the largest independent energy investing
firm in the U.S. Previously, he was senior vice president with the investment banking firm
of Donaldson, Lufkin &amp; Jenrette, responsible for the firm&#146;s domestic and
international investment banking business. He had also been a vice president with New
Court Securities (now Rothschild, Inc.). He was a director of Lydall, Inc. (NYSE),
Manchester, CT, a manufacturer of thermal, acoustical and filtration materials, from 1974
to 2004, and its chairman from 1998 to 2004. He is a director of Paxar Corporation, White
Plains, NY, a leading manufacturer of labeling systems, and a director of Standard Motor
Products, Inc., Long Island City, NY, a manufacturer of automobile replacement parts. He
is also a senior moderator of the Executive Seminar in the Humanities at The Aspen
Institute, and is a board member of the March of Dimes of Greater New York and of Oxfam
America. Mr. Widmann received an A.B. from Brown University and a J.D. from Columbia
University.</TD>
<TD WIDTH=5%> </TD>
<TD WIDTH=20%>2003
 </TD>
</TR>
</TABLE>
<BR>

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<P ALIGN=CENTER><FONT SIZE=3><B>CORPORATE GOVERNANCE PRINCIPLES </B></FONT></P>

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<H1 ALIGN=LEFT><FONT SIZE=3>Independent Directors </FONT></H1>

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<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Pursuant
to rules of the New York Stock Exchange and applicable law, a majority of the
Company&#146;s directors must be independent as specified therein. As a result, the Board
undertook a review of the independence of the Company&#146;s directors. During this
review, the Board considered transactions and relationships between each director or any
member of his or her immediate family and the Company and its subsidiaries and affiliates,
including those reported under &#147;Transactions with Related Persons&#148; below. The
Board also examined transactions and relationships between directors or their affiliates
and members of the Company&#146;s senior management or their affiliates. The purpose of
this review was to determine whether any such relationship or transaction was inconsistent
with a determination that the director is independent. </FONT></P>

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<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;As
the result of this review, the Board affirmatively determined that each of Messrs. Burns,
Kirk, Miller and Widmann is independent of the Company and its management. The Board
determined that none of these independent Directors had any material relationships with
the Company. The directors who are not independent are Messrs. Ullman and Homburg and Ms.
Walker. </FONT></P>

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<H1 ALIGN=LEFT><FONT SIZE=3>Corporate Governance
Principles and Committee Charters </FONT></H1>

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<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Our
Board of Directors has adopted a comprehensive set of corporate governance principles to
reflect its commitment to corporate governance and the role of such principles in building
and sustaining stockholder value. These principles are discussed more fully below and are
set forth in our Code of Business Conduct and Ethics and the committee charters for our
Audit Committee, Compensation Committee and Nominating/Corporate Governance Committee.
These documents are available on our website at www.cedarshoppingcenters.com or by written
request to the Company, attention: Investor Relations, 44 South Bayles Avenue, Port
Washington, NY 11050. </FONT></P>

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<H1 ALIGN=LEFT><FONT SIZE=3>Code of Business Conduct
and Ethics </FONT></H1>

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<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;All
of our employees, including our chief executive officer, chief financial officer and chief
accounting officer, and our Directors are required to comply with our Code of Business
Conduct and Ethics. Our Code is available on our website. It is our intention to disclose
any amendments to, or waivers from, any provisions of this Code as it applies to our chief
executive officer, chief financial officer and chief accounting officer on our website
within three business days of such amendment or waiver. </FONT></P>

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<H1 ALIGN=LEFT><FONT SIZE=3>Audit Committee </FONT></H1>

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<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
Board of Directors has established an Audit Committee consisting of James J. Burns,
Everett B. Miller, III and Roger M. Widmann. The charter of the Audit Committee is
available on the Company&#146;s website. All the members of the Audit Committee are
independent under the rules of the New York Stock Exchange and applicable law.
Mr.&nbsp;Burns is qualified as an audit committee financial expert within the meaning of
applicable law and the Board has determined that he has accounting and related financial
management expertise under the rules of the New York Stock Exchange. The functions of this
committee include engaging and discharging of the independent auditors, reviewing with the
independent auditors the plan and results of the auditing engagement, reviewing the
independence of the independent auditors and reviewing the range of audit and non-audit
fees. </FONT></P>

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<H1 ALIGN=LEFT><FONT SIZE=3>Compensation Committee </FONT></H1>

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<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
Board of Directors has established a Compensation Committee consisting of James J. Burns,
Paul G. Kirk, Jr., Everett B. Miller, III and Roger M. Widmann, all of whom are
independent. This committee reviews and approves the compensation and benefits of
executive officers and directors, administers and makes recommendations to the Board of
Directors regarding executive and director compensation and stock incentive plans and
produces an annual report on executive compensation for inclusion in the proxy statement. </FONT></P>

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<H1 ALIGN=LEFT><FONT SIZE=3>Nominating/Corporate
Governance Committee </FONT></H1>

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<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
Board of Directors has established a Nominating/Corporate Governance Committee consisting
of James J. Burns, Paul G. Kirk, Jr., and Roger M. Widmann, all of whom are independent.
This committee develops and recommends to the Board of Directors a set of corporate
governance principles, adopts a code of ethics, adopts policies with respect to conflicts
of interest, monitors compliance with corporate governance requirements of state and
federal law and the rules and regulations of the New York Stock Exchange, establishes
criteria for prospective members of the Board of Directors, conducts candidate searches
and interviews, oversees and evaluates the Board of Directors and management, evaluates
from time to time the appropriate size and composition of the Board of Directors and
formally proposes the slate of Directors to be elected at each Annual Meeting of
Stockholders. </FONT></P>

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<H1 ALIGN=LEFT><FONT SIZE=3>Nomination of Directors </FONT></H1>

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<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
Nominating/Corporate Governance Committee is responsible for the selection and nomination
of Directors. The Committee has adopted a policy to consider nominees recommended by
stockholders of the Company. Stockholders who wish to recommend a nominee should send
nominations directly to the Nominating/Corporate Governance Committee, at the principal
executive offices of the Company, that include all information relating to such person
that is required to be disclosed in solicitations of proxies for the election of
directors, including the nominee&#146;s name, business experience and consent to be
nominated for membership on our Board of Directors and to serve if elected by the
stockholders. The recommendation must be received not later than the date for stockholder
proposals set forth herein under &#147;Other Matters&#151;Stockholder Proposals.&#148; We
did not receive for this Meeting any recommended nominees for Director from any of our
stockholders. We do not currently pay any fees to third parties to identify or evaluate or
assist in identifying or evaluating potential nominees for director. The
Nominating/Corporate Governance Committee considers candidates for Board membership
suggested by its members and other Board members, as well as management and stockholders. </FONT></P>

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<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Once
the Nominating/Corporate Governance Committee has identified a prospective nominee, the
Committee makes an initial determination as to whether to conduct a full evaluation of the
candidate. This initial determination is based on whatever information is provided to the
Committee with the recommendation of the prospective candidate, as well as the
Committee&#146;s own knowledge of the prospective candidate, which may be supplemented by
inquiries to the person making the recommendation or others. The preliminary determination
is based primarily on the need for additional Board members to fill vacancies or expand
the size of the Board and the likelihood that the prospective nominee can satisfy the
evaluation factors described below. If the Committee determines, in consultation with the
Chairman of the Board and other Board members as appropriate, that additional
consideration is warranted, it may request additional information about the prospective
nominee&#146;s background and experience and report its findings to the Board. The
Committee then evaluates the prospective nominee against the standards and qualifications
set out in the Company&#146;s guidelines, including: </FONT></P>

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<TR VALIGN=TOP>
<TD WIDTH=5%></TD>
<TD WIDTH=5%>&#149;</TD>
<TD WIDTH=90%>the ability of the prospective nominee to represent the interests of the
stockholders of the Company;</TD>
</TR>
</TABLE>
<BR>


<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5%></TD>
<TD WIDTH=5%>&#149;</TD>
<TD WIDTH=90%>the prospective nominee's standards of integrity, commitment and independence of
thought and judgment;</TD>
</TR>
</TABLE>
<BR>


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<TR VALIGN=TOP>
<TD WIDTH=5%><FONT SIZE=3>&nbsp; </FONT></TD>
<TD WIDTH=5%><FONT SIZE=3>&#149; </FONT></TD>
<TD WIDTH=90%><FONT SIZE=3>
the prospective nominee&#146;s ability to dedicate sufficient time, energy and attention
to the diligent performance of his or her duties, including the prospective nominee&#146;s
service on other public company boards; </FONT></TD>
</TR>
</TABLE>
<BR>

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<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0>
<TR VALIGN=TOP>
<TD WIDTH=5%><FONT SIZE=3>&nbsp; </FONT></TD>
<TD WIDTH=5%><FONT SIZE=3>&#149; </FONT></TD>
<TD WIDTH=90%><FONT SIZE=3>
the extent to which the prospective nominee contributes to the range of talent, skill and
expertise appropriate for the business of the Company; and </FONT></TD>
</TR>
</TABLE>
<BR>

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<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0>
<TR VALIGN=TOP>
<TD WIDTH=5%><FONT SIZE=3>&nbsp; </FONT></TD>
<TD WIDTH=5%><FONT SIZE=3>&#149; </FONT></TD>
<TD WIDTH=90%><FONT SIZE=3>
the extent to which the prospective nominee helps the Board reflect the diversity of the
Company&#146;s stockholders, employees, customers and communities. </FONT></TD>
</TR>
</TABLE>
<BR>

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<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
Committee also considers such other relevant factors as it deems appropriate, including
the current composition of the Board, the balance of management and independent directors,
the need for Audit Committee expertise and the evaluations of other prospective nominees.
In connection with this evaluation, the Committee determines whether to interview the
prospective nominee, and if warranted, one or more members of the Committee, and others as
appropriate, interview prospective nominees in person or by telephone. After completing
this evaluation and interview, the Committee makes a recommendation to the full Board as
to the persons who should be nominated by the Board, and the Board determines the nominees
after considering the recommendation and report of the Committee. </FONT></P>

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<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;There
are no differences in the manner in which the Nominating/Corporate Governance Committee
evaluates nominees for director based on whether the nominee is recommended by a
stockholder or the Committee. </FONT></P>

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<H1 ALIGN=LEFT><FONT SIZE=3>Board Meetings </FONT></H1>

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<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;In
the fiscal year ended December 31, 2006, there were seven meetings of the Board of
Directors, four meetings of the Audit Committee, five meetings of the Compensation
Committee and two meetings of the Nominating/Corporate Governance Committee. Each Director
of the Company attended in excess of 75% of the total number of meetings of the Board of
Directors and committees on which he or she served. Board members are encouraged to attend
our Annual Meeting of Stockholders. All of our Directors attended our 2006 Annual Meeting,
except for Mr. Homburg. </FONT></P>

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<H1 ALIGN=LEFT><FONT SIZE=3>Communications with the Board </FONT></H1>

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<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
Nominating/Corporate Governance Committee of the Board approved a process for handling
letters received by the Company and addressed to non-management members of the Board.
Stockholders and other parties interested in communicating with any Directors of the
Company (or the Board as a group), may do so by writing to the Secretary of the Company,
at the Company&#146;s principal executive offices. The Secretary will review all such
correspondence and regularly forward to the Board a summary of all such correspondence and
copies of all correspondence that, in the Secretary&#146;s opinion, deals with the
functions of the Board or committees thereof or that he otherwise determines to require
the Board&#146;s attention. The Board, or any member thereof, may at any time request that
copies of all such correspondence be forwarded to the Board. </FONT></P>

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<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Correspondence
relating to accounting, internal controls or auditing matters is handled by the Audit
Committee in accordance with its procedures. </FONT></P>

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<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
non-management directors of our Board meet in executive session several times during the
year, generally on the same day as regularly scheduled meetings of the Board of Directors
or as considered necessary or appropriate. Mr. Kirk has been chosen by the non-management
Directors to be the independent lead director and to preside at each such meeting. </FONT></P>

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<P ALIGN=CENTER><FONT SIZE=3><B>COMPENSATION DISCUSSION AND ANALYSIS </B></FONT></P>

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<P ALIGN=LEFT><FONT SIZE=3><U>Overview of Compensation Program</U></FONT></P>

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<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;In
2004, shortly after our completion of a significant offering of our common stock, we
formulated a preliminary compensation philosophy which was designed to provide a
market-competitive, performance-based compensation package consisting of base salary,
annual bonuses and long-term equity awards for performance. Since then, our Compensation
Committee has taken steps to implement this program. Our Compensation Committee has
responsibility for designing and implementing our compensation program for the chief
executive officer, or CEO, and other executives. The Committee evaluates the performance
of the CEO and determines his compensation in light of the goals and objectives of the
compensation program, based on all the criteria discussed herein. Based on initial
recommendations and input from the CEO, the Committee assesses the performance of the
other executives and determines their compensation. Our Compensation Committee retained a
compensation consulting firm, Chernoff Diamond &amp; Co., LLC, to assist our Committee in
implementing the compensation policy. The consultant provides our Committee with relevant
market data about our peer companies and makes recommendations as to compensation matters.
The discussion under this Compensation Discussion and Analysis relates to the CEO and the
other executive officers included in the Summary Compensation Table. </FONT></P>

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<P ALIGN=LEFT><FONT SIZE=3><U>Compensation Objectives</U></FONT></P>

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<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;As
set forth in its Charter, the Committee&#146;s compensation philosophy is to align
executive compensation with the interests of stockholders, attract, retain and motivate a
highly competent team of executives, link pay to performance, achieve a balance between
short-term and long-term results, teamwork and individual contributors and utilize equity
as a significant reward for performance. </FONT></P>

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<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
consultant recommended that a three-component approach to executive compensation be
implemented consisting of base salary, annual bonuses and long-term equity compensation.
As a result, two key elements of compensation depend upon the performance of the
executive, including (a) an annual bonus that is based on an assessment of the
executive&#146;s performance against pre-determined measures within the context of our
overall performance and (b)&nbsp;equity compensation in the form of full value shares, the
value of which is contingent on a three-year total stockholder return, subject to
three-year vesting to require continued service with us. Salary is intended to be
commensurate with the executive&#146;s scope of responsibility and effectiveness. Bonuses
are designed to reward annual results. Long-term equity compensation focuses on our
Company achieving long-term sustained results. We attempt to retain our executives by
rewarding the executives only if the executive remains with us for the entire three-year
performance period. The policy for allocating between either cash and non-cash
compensation or short-term or long-term compensation is established on an annual basis.
The Committee determines the appropriate level and mix of compensation. </FONT></P>

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<P ALIGN=LEFT><FONT SIZE=3><U>Implementation</U></FONT></P>

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<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
consultant selected a peer group of 14 REITs with a business focus similar to ours, a
majority of which are our direct competitors. The data that was obtained for these
companies was for the 2005 fiscal year. The peer group selected by the Committee consisted
of the following companies: </FONT></P>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=10%></TD>
<TD WIDTH=40%>Agree Realty<BR>
Kite Realty Group<BR>
Ashford Hospitality<BR>
First Potomac Realty<BR>
Ramco-Gershenson Properties<BR>
Acadia Realty<BR>
Tanger Factory Outlet Centers</TD>
<TD WIDTH=50%>Trustreet Properties<BR>
Commercial Net Lease Realty<BR>
Washington Real Estate<BR>
Lexington Corporate Properties<BR>
Heritage Property<BR>
Equity One<BR>
Colonial Properties</TD>
</TR>
</TABLE>
<BR>

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<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Since
we had a market capitalization which was smaller than nine of such peers, the consultant
recommended that total executive compensation should be at or below the median of the peer
group. With respect to the long-term compensation, the consultant determined that
restricted stock was used more widely among the peer group than stock options. </FONT></P>

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<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Based
on its review of compensation numbers for 2005, the consultant determined that the total
compensation for the CEO was approximately at the market for the peers while total
compensation for the other four most highly paid officers was below the median. </FONT></P>

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<P ALIGN=LEFT><FONT SIZE=3><U>Base Salary</U></FONT></P>

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<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Base
salaries for our executives depend on the scope of their responsibilities and their
performance. Base salary is designed to compensate the executives for services rendered
during the year. These salaries are compared to amounts paid to the executive&#146;s peers
outside our company. Salary levels are typically considered annually as part of the
Committee&#146;s performance review process and increases are based on the
Committee&#146;s assessment of the performance of the executive. </FONT></P>

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<P ALIGN=LEFT><FONT SIZE=3><U>Annual Bonus</U></FONT></P>

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<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;We
seek to align the interests of the named executive officers by evaluating executive
performance on the basis of specified financial tests. Target bonuses were established at
a percentage of base salary according to the executive&#146;s level of responsibility. We
attempt to achieve an appropriate mix between cash payments and equity awards. </FONT></P>

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<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;As
part of its continuing review of appropriate performance measures, the Compensation
Committee discussed whether the bonus award should be based on funds from operations
(&#147;FFO&#148;) or adjusted funds from operations (&#147;AFFO&#148;) since a large
portion of our FFO was non-cash. AFFO would be determined by FFO, as adjusted for
straight-line rents, amortization of intangible lease liabilities, non-real estate
amortization and restricted stock awards. The Committee believed that the majority of the
industry had always utilized FFO, which remains an important metric for reporting to
securities analysts, but some companies have chosen to emphasize AFFO as a more
appropriate benchmark for incentive compensation. The Compensation Committee determined
that 2006 would be a transition year and that the actual bonus would be based on the
average of FFO and AFFO results for the year. The Committee then set $1.025 per share as
the performance target for receiving the bonus, after an adjustment to eliminate the
dilutive effect of any stock issuance. The payout scale is a 3% increase (or decrease) in
bonus for each 1% increase (or decrease) in actual performance from the base target. For
2007, the base target was set by the Committee at $1.04 per share of AFFO, a significant
increase over the $.89 per share of AFFO realized by the Company in 2006. </FONT></P>

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<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Commencing
in 2007, the target bonus will be based entirely on AFFO and no bonus will be paid if our
actual results are less than 80% of the target. The maximum payout will be 200% of the
target bonus. The Committee noted that the numbers all needed to be adjusted for dilution. </FONT></P>

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<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Each
year, a portion of Annual Bonus is deferred in the form of Restricted Shares to be issued
in accordance with the terms of our 2004 Stock Incentive Plan (the &#147;Incentive
Plan&#148;), which are discounted 15% from the market price and which cliff vest on the
third anniversary of the grant date, subject to acceleration of vesting under the
Incentive Plan upon retirement, death or disability or upon the occurrence of a change in
control. For 2006, the portion of Annual Bonus deferred as Restricted Shares was 60%. </FONT></P>

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<P ALIGN=LEFT><FONT SIZE=3><U>Long-Term Compensation</U></FONT></P>

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<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
Committee determined that long-term incentive compensation would be in the form of
performance-based restricted stock to be issued in accordance with the terms of our
Incentive Plan, with performance measured against an agreed-upon three-year total
stockholder return (&#147;TSR&#148;) target. TSR was selected since it ties this portion
of the compensation to stockholder value, with the total value of these awards
corresponding to stock price appreciation and dividends. It was determined to use
different criteria for long-term compensation than for annual bonuses, with TSR having a
longer-term focus than AFFO. For 2006, such compensation would be paid by the granting of
restricted stock under the Incentive Plan, with 50% vesting on
the third anniversary if the employee was still employed by the Company, and the remaining
50% to vest if the TSR over the three year period of 2006-2008 averaged 8% or more per
year for the three years. Each holder of restricted stock is entitled to receive and
retain all dividends paid on such stock even though such stock has not vested. TSR is
determined by adding dividends paid during the year to the change in stock price for such
year, with the stock price to be measured as the average closing price for the last 20
trading days of the year. This would be measured for the complete three-year period. Stock
awards are based on both performance and continued service with us, subject to
acceleration of vesting under the Incentive Plan upon retirement, death or disability or
upon a change in control. In order for the stock to be earned, we must achieve TSR goals
within the three-year performance period and the employee must remain employed by us for
such three years. In determining awards, we do not consider the equity ownership of the
employees or prior awards that have been granted. Our practice is to determine the dollar
amount of equity compensation to be granted and then to grant a number of full value
shares that have a fair market value equal to that amount on the first trading day of the
year for which the grant is made. Fair market value is determined by selecting the closing
price of our common stock. The Committee reserved the right to establish different
criteria for grants in future years. Historically, our practice has been to issue
restricted shares and not to grant stock options. Aside from some minor grants of stock
options to our directors in 2001, we have not granted any stock options. </FONT></P>

<!-- MARKER FORMAT-SHEET="Stroock Head Left" FSL="Default" -->
<P ALIGN=LEFT><FONT SIZE=3><U>Perquisites</U></FONT></P>

<!-- MARKER FORMAT-SHEET="Para Large Indent" FSL="Workstation" -->
<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
only material perquisite provided to our executive officers is reimbursement for use of an
automobile. </FONT></P>

<!-- MARKER FORMAT-SHEET="Stroock Head Left" FSL="Default" -->
<P ALIGN=LEFT><FONT SIZE=3><U>Retirement Benefits</U></FONT></P>

<!-- MARKER FORMAT-SHEET="Para Large Indent" FSL="Default" -->
<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Named
executive officers participate in the Company&#146;s tax qualified 401(k) plan providing
for employer and employee contributions. </FONT></P>

<!-- MARKER FORMAT-SHEET="Para Large Indent" FSL="Workstation" -->
<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;We
do not provide any supplemental retirement benefits for executives. </FONT></P>

<!-- MARKER FORMAT-SHEET="Stroock Head Left" FSL="Default" -->
<P ALIGN=LEFT><FONT SIZE=3><U>Employment Agreements</U></FONT></P>

<!-- MARKER FORMAT-SHEET="Para Large Indent" FSL="Workstation" -->
<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;We entered
into employment agreements with our key executive officers in 2003. Each of these
agreements has change in control provisions that are designed to promote stability and
continuity of senior management. These agreements, including change in control payments,
are more fully described in &#147;Employment Agreements with Executive Officers.&#148; </FONT></P>

<!-- MARKER FORMAT-SHEET="Stroock Head Left" FSL="Default" -->
<P ALIGN=LEFT><FONT SIZE=3><U>Stock Ownership Guidelines</U></FONT></P>

<!-- MARKER FORMAT-SHEET="Para Large Indent" FSL="Default" -->
<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;In
March 2007, we established target stock ownership guidelines for our named executive
officers. The number of shares of our common stock that is targeted to be owned is set at
a multiple of the executive&#146;s base salary. For the chief executive officer, the
multiple is four times base salary, while for the other named executive officers the
multiple is two times base salary. The chief executive officer is expected to reach this
level within a period of three years, while the other named executive officers have four
years to reach such level. </FONT></P>

<!-- MARKER FORMAT-SHEET="Para Large Indent" FSL="Workstation" -->
<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;We
also recently established target ownership guidelines for our directors. For each director
who has served as a director for at least four years, such director is expected to own
shares of our common stock totaling not less than the number of shares constituting the
equity portion of his annual retainer for the previous four years. </FONT></P>

<!-- MARKER FORMAT-SHEET="Stroock Head Left" FSL="Default" -->
<P ALIGN=LEFT><FONT SIZE=3><U>Tax Deductibility of Compensation</U></FONT></P>

<!-- MARKER FORMAT-SHEET="Para Large Indent" FSL="Default" -->
<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
Internal Revenue Code of 1986, as amended (the &#147;Code&#148;), was amended in 1993 with
respect to the ability of publicly-held corporations such as the Company to deduct
compensation in excess of $1,000,000 per individual, other than performance-based
compensation. The Compensation Committee continues to evaluate maximizing the
deductibility of executive compensation, while retaining the discretion it deems necessary
to compensate executive officers. </FONT></P>

<!-- MARKER FORMAT-SHEET="Head Major Left Bold" FSL="Default" -->
<H1 ALIGN=LEFT><FONT SIZE=3>Executive Compensation </FONT></H1>

<!-- MARKER FORMAT-SHEET="Para Large Indent" FSL="Default" -->
<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
following table sets forth certain information regarding compensation paid by the Company
to its chief executive officer and to each of its four most highly compensated executive
officers whose salary and bonus for 2006 exceeded $100,000. </FONT></P>

<!-- MARKER FORMAT-SHEET="Head Major Center Bold 1" FSL="Default" -->
<H1 ALIGN=CENTER><FONT SIZE=3>Summary Compensation
Table </FONT></H1>

<TABLE CELLPADDING=0 CELLSPACING=0 BORDER=0 WIDTH=100%>
<TR VALIGN=Bottom>
     <TH COLSPAN=2>Name and Principal Position<HR WIDTH=90% SIZE=1 COLOR=BLACK NOSHADE></TH>
     <TH COLSPAN=2>Year<HR WIDTH=90% SIZE=1 COLOR=BLACK NOSHADE></TH>
     <TH COLSPAN=2>Salary(1)<BR>
($)<HR WIDTH=90% SIZE=1 COLOR=BLACK NOSHADE></TH>
     <TH COLSPAN=2>Bonus(1)(2)<BR>
($)<HR WIDTH=90% SIZE=1 COLOR=BLACK NOSHADE></TH>
     <TH COLSPAN=2>Stock<BR>
Awards(3)<BR>
($)<HR WIDTH=90% SIZE=1 COLOR=BLACK NOSHADE></TH>
     <TH COLSPAN=2>All<BR>
Other<BR>
Compen-<BR>
sation(4)<BR>
($)<HR WIDTH=90% SIZE=1 COLOR=BLACK NOSHADE></TH>
     <TH COLSPAN=2>Total<BR>
($)<HR WIDTH=90% SIZE=1 COLOR=BLACK NOSHADE></TH></TR>
<TR VALIGN=Bottom>
     <TD WIDTH=35% ALIGN=LEFT>Leo S. Ullman</TD>
     <TD WIDTH=3% ALIGN=LEFT>&nbsp;</TD>
     <TD WIDTH=4% ALIGN=LEFT>2006</TD>
     <TD WIDTH=3% ALIGN=LEFT>&nbsp;</TD>
     <TD WIDTH=7% ALIGN=RIGHT>425,000</TD>
        <TD WIDTH=6% ALIGN=LEFT>&nbsp;</TD>
     <TD WIDTH=7% ALIGN=RIGHT>514,568</TD>
        <TD WIDTH=6% ALIGN=LEFT></TD>
     <TD WIDTH=7% ALIGN=RIGHT>212,156</TD>
        <TD WIDTH=3% ALIGN=LEFT>&nbsp;</TD>
     <TD WIDTH=7% ALIGN=RIGHT>16,922</TD>
        <TD WIDTH=3% ALIGN=LEFT>&nbsp;</TD>
     <TD WIDTH=7% ALIGN=RIGHT>1,168,646</TD>
        <TD WIDTH=2% ALIGN=LEFT>&nbsp;</TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT>President and Chief Executive</TD><TD ALIGN=LEFT>&nbsp;</TD>
     <TD ALIGN=LEFT>&nbsp;</TD><TD ALIGN=LEFT>&nbsp;</TD>
     <TD ALIGN=RIGHT>&nbsp;</TD>
        <TD ALIGN=LEFT>&nbsp;</TD>
     <TD ALIGN=RIGHT>&nbsp;</TD>
        <TD ALIGN=LEFT>&nbsp;</TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT>Officer</TD><TD ALIGN=LEFT>&nbsp;</TD>
     <TD ALIGN=LEFT>&nbsp;</TD><TD ALIGN=LEFT>&nbsp;</TD>
     <TD ALIGN=RIGHT>&nbsp;</TD>
        <TD ALIGN=LEFT>&nbsp;</TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><BR>Thomas J. O'Keeffe</TD>
     <TD ALIGN=LEFT>&nbsp;</TD>
     <TD ALIGN=LEFT>2006</TD><TD ALIGN=LEFT>&nbsp;</TD>
     <TD ALIGN=RIGHT>300,000</TD>
        <TD ALIGN=LEFT>&nbsp;</TD>
     <TD ALIGN=RIGHT>363,230</TD>
        <TD ALIGN=LEFT></TD>
     <TD ALIGN=RIGHT>93,964</TD>
        <TD ALIGN=LEFT>&nbsp;</TD>
     <TD ALIGN=RIGHT>16,813</TD>
        <TD ALIGN=LEFT>&nbsp;</TD>
     <TD ALIGN=RIGHT>774,007</TD>
        <TD ALIGN=LEFT>&nbsp;</TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT>Chief Financial Officer</TD><TD ALIGN=LEFT>&nbsp;</TD>
     <TD ALIGN=LEFT>&nbsp;</TD><TD ALIGN=LEFT>&nbsp;</TD>
     <TD ALIGN=RIGHT>&nbsp;</TD>
        <TD ALIGN=LEFT>&nbsp;</TD>
     <TD ALIGN=RIGHT>&nbsp;</TD>
        <TD ALIGN=LEFT>&nbsp;</TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><BR>Brenda J. Walker</TD><TD ALIGN=LEFT>&nbsp;</TD>
     <TD ALIGN=LEFT>2006</TD><TD ALIGN=LEFT>&nbsp;</TD>
     <TD ALIGN=RIGHT>250,000</TD>
        <TD ALIGN=LEFT>&nbsp;</TD>
     <TD ALIGN=RIGHT>199,782</TD>
        <TD ALIGN=LEFT></TD>
     <TD ALIGN=RIGHT>47,128</TD>
        <TD ALIGN=LEFT>&nbsp;</TD>
     <TD ALIGN=RIGHT>12,150</TD>
        <TD ALIGN=LEFT>&nbsp;</TD>
     <TD ALIGN=RIGHT>509,060</TD>
        <TD ALIGN=LEFT>&nbsp;</TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT>Vice President</TD><TD ALIGN=LEFT>&nbsp;</TD>
     <TD ALIGN=LEFT>&nbsp;</TD><TD ALIGN=LEFT>&nbsp;</TD>
     <TD ALIGN=RIGHT>&nbsp;</TD>
        <TD ALIGN=LEFT>&nbsp;</TD>
     <TD ALIGN=RIGHT>&nbsp;</TD>
        <TD ALIGN=LEFT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><BR>Thomas B. Richey</TD><TD ALIGN=LEFT>&nbsp;</TD>
     <TD ALIGN=LEFT>2006</TD><TD ALIGN=LEFT>&nbsp;</TD>
     <TD ALIGN=RIGHT>250,000</TD>
        <TD ALIGN=LEFT>&nbsp;</TD>
     <TD ALIGN=RIGHT>363,230</TD>
        <TD ALIGN=LEFT></TD>
     <TD ALIGN=RIGHT>87,315</TD>
        <TD ALIGN=LEFT>&nbsp;</TD>
     <TD ALIGN=RIGHT>10,718</TD>
        <TD ALIGN=LEFT>&nbsp;</TD>
     <TD ALIGN=RIGHT>711,263</TD>
        <TD ALIGN=LEFT>&nbsp;</TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT>Vice President</TD><TD ALIGN=LEFT>&nbsp;</TD>
     <TD ALIGN=LEFT>&nbsp;</TD><TD ALIGN=LEFT>&nbsp;</TD>
     <TD ALIGN=RIGHT>&nbsp;</TD>
        <TD ALIGN=LEFT>&nbsp;</TD>
     <TD ALIGN=RIGHT>&nbsp;</TD>
        <TD ALIGN=LEFT>&nbsp;</TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><BR>Nancy H. Mozzachio</TD><TD ALIGN=LEFT>&nbsp;</TD>
     <TD ALIGN=LEFT>2006</TD><TD ALIGN=LEFT>&nbsp;</TD>
     <TD ALIGN=RIGHT>225,000</TD>
        <TD ALIGN=LEFT>&nbsp;</TD>
     <TD ALIGN=RIGHT>211,876</TD>
        <TD ALIGN=LEFT></TD>
     <TD ALIGN=RIGHT>22,667</TD>
        <TD ALIGN=LEFT>&nbsp;</TD>
     <TD ALIGN=RIGHT>9,060</TD>
        <TD ALIGN=LEFT>&nbsp;</TD>
     <TD ALIGN=RIGHT>468,603</TD>
        <TD ALIGN=LEFT>&nbsp;</TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT>Vice President</TD><TD ALIGN=LEFT>&nbsp;</TD>
     <TD ALIGN=LEFT>&nbsp;</TD><TD ALIGN=LEFT>&nbsp;</TD>
     <TD ALIGN=RIGHT>&nbsp;</TD>
        <TD ALIGN=LEFT>&nbsp;</TD>
     <TD ALIGN=RIGHT>&nbsp;</TD>
        <TD ALIGN=LEFT>&nbsp;</TD></TR>
</TABLE>
<BR>

<!-- MARKER FORMAT-SHEET="Para (List) Hang Level 1" FSL="Default" -->
          <TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0>
               <TR VALIGN=TOP>
               <TD WIDTH=5%><FONT SIZE=3>(1) </FONT></TD>
               <TD WIDTH=95%><P ALIGN=LEFT><FONT SIZE=3>
               All of the named executives contributed (a) a portion of their cash bonus to
               the 2005 Cedar Shopping Centers, Inc. Deferred Compensation Plan, and (b) a
               portion of their salaries to the Company&#146;s 401(k) Savings Plan. In
               addition, Messrs. O&#146;Keeffe and Richey contributed a portion of their
               salaries to the 2005 Cedar Shopping Centers, Inc. Deferred Compensation Plan. </FONT></P></TD>
               </TR>
               </TABLE>
               <BR>

<!-- MARKER FORMAT-SHEET="Para (List) Hang Level 1" FSL="Default" -->
          <TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0>
               <TR VALIGN=TOP>
               <TD WIDTH=5%><FONT SIZE=3>(2) </FONT></TD>
               <TD WIDTH=95%><P ALIGN=LEFT><FONT SIZE=3>
               This column represents the total bonus earned in 2006, 40% of which was paid in
               cash and 60% of which was paid in the form of restricted shares of common stock
               issued at a 15% discount to the market price as of January 1, 2007. These shares
               vest on the third anniversary of the grant date or January 1, 2010. </FONT></P></TD>
               </TR>
               </TABLE>
               <BR>

<!-- MARKER FORMAT-SHEET="Para (List) Hang Level 1" FSL="Default" -->
          <TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0>
               <TR VALIGN=TOP>
               <TD WIDTH=5%><FONT SIZE=3>(3) </FONT></TD>
               <TD WIDTH=95%><P ALIGN=LEFT><FONT SIZE=3>
               This column represents the dollar amount charged to operations for financial
               statement reporting purposes during 2006 with respect to all restricted stock
               grants (for 2006 as well as for prior years), in accordance with the Financial
               Accounting Standards Board&#146;s Statement of Financial Accounting Standards
               (&#147;SFAS&#148;) No. 123R, &#147;Share-Based Payments&#148;. A portion of the
               restricted share grants is subject to market conditions, i.e., they are tied to
               total stockholder return, as described in the Compensation Discussion and
               Analysis (&#147;CDA&#148;), which reduces the grant-date fair value under SFAS
               123R. For additional information, see Note 2, &#147;Summary of Significant
               Accounting Policies &#150; Share-Based Compensation&#148;, to the Company&#146;s
               consolidated financial statements in the Company&#146;s Annual Report on Form
               10-K for the year ended December 31, 2006, as filed with the Securities and
               Exchange Commission. </FONT></P></TD>
               </TR>
               </TABLE>
               <BR>

<!-- MARKER FORMAT-SHEET="Para (List) Hang Level 1" FSL="Default" -->
          <TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0>
               <TR VALIGN=TOP>
               <TD WIDTH=5%><FONT SIZE=3>(4) </FONT></TD>
               <TD WIDTH=95%><P ALIGN=LEFT><FONT SIZE=3>
               Consists of matching contributions made by the Company pursuant to its 401(k)
               plan. </FONT></P></TD>
               </TR>
               </TABLE>
               <BR>

<!-- MARKER FORMAT-SHEET="Head Major Left Bold" FSL="Default" -->
<H1 ALIGN=LEFT><FONT SIZE=3>Employment Agreements
With Executive Officers </FONT></H1>

<!-- MARKER FORMAT-SHEET="Para Large Indent" FSL="Default" -->
<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
Company has entered into employment agreements, as amended, with Messrs.&nbsp;Ullman,
O&#146;Keeffe and Richey and Ms. Mozzachio and Ms. Walker. The annual base salary
established for each of these officers presently is $456,875, $322,500, $268,750, $241,875
and $268,750, respectively. </FONT></P>

<!-- MARKER FORMAT-SHEET="Para Large Indent" FSL="Default" -->
<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Each
agreement initially was for a term of four years expiring October 31, 2007, except for Ms.
Mozzachio that was for two years. Commencing October 1, 2007, and on each October 1
thereafter, Mr. Ullman&#146;s agreement is automatically extended for successive one year
periods unless either the Company or Mr. Ullman, by notice given at least 60 days prior to
the scheduled termination, elects not to so extend the agreement. Mr. Richey&#146;s
agreement was recently amended to provide that it terminates on October 31, 2009, while
Ms. Mozzachio&#146;s and Ms. Walker&#146;s agreements were amended to provide that they
expire October 31, 2008. Under each agreement, an officer&#146;s employment agreement will
terminate automatically upon the retirement, death or disability of such officer, without
payment of any additional compensation, except that under the Incentive Plan all unvested
Restricted Shares will immediately become fully vested. In the event of termination of an
agreement by the Company without cause or by the executive for good reason, or, in the
case of Mr. Ullman the Company elects not to extend his employment on October 1, 2007 or
on any October 1 thereafter, the executive is entitled to receive from the Company within
five days following termination: </FONT></P>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5%></TD>
<TD WIDTH=5%>&#149;</TD>
<TD WIDTH=90%>Any earned and unpaid base salary;</TD>
</TR>
</TABLE>
<BR>

<!-- MARKER FORMAT-SHEET="Para Large Hang Level 2" FSL="Default" -->
<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0>
<TR VALIGN=TOP>
<TD WIDTH=5%></TD>
<TD WIDTH=5%><FONT SIZE=3>&#149; </FONT></TD>
<TD WIDTH=90%><FONT SIZE=3>
A lump sum cash payment of two and one-half times (2.99 times with respect to Mr. Ullman)
the executive&#146;s annual base salary and average annual bonus for the preceding two
years; </FONT></TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5%></TD>
<TD WIDTH=5%>&#149;</TD>
<TD WIDTH=90%>Continuation of health insurance benefits for 12 months (to be reduced to the
extent the executive receives comparable benefits); and</TD>
</TR>
</TABLE>
<BR>


<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5%></TD>
<TD WIDTH=5%>&#149;</TD>
<TD WIDTH=90%>Acceleration of vesting of all options, restricted shares and other awards.</TD>
</TR>
</TABLE>
<BR>

<!-- MARKER FORMAT-SHEET="Para Large Indent" FSL="Default" -->
<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
executives will also be entitled to be grossed up, on an after-tax basis, for any excise
taxes imposed under the Code on any excess parachute payments that they receive in
connection with the benefits and payments provided to them in connection with any change
in control. </FONT></P>

<!-- MARKER FORMAT-SHEET="Head Sub 2 Left" FSL="Default" -->
<P ALIGN=LEFT><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Good reason means:</FONT></P>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5%></TD>
<TD WIDTH=5%>&#149;</TD>
<TD WIDTH=90%>Material breach by the Company of the employment agreement;</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5%></TD>
<TD WIDTH=5%>&#149;</TD>
<TD WIDTH=90%>A material reduction in the executive's duties or responsibilities;</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5%></TD>
<TD WIDTH=5%>&#149;</TD>
<TD WIDTH=90%>The relocation of the executive or the headquarters of the Company to any
location outside of the New York City metropolitan area; or</TD>
</TR>
</TABLE>
<BR>


<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5%></TD>
<TD WIDTH=5%>&#149;</TD>
<TD WIDTH=90%>A change in control of the Company.</TD>
</TR>
</TABLE>
<BR>

<!-- MARKER FORMAT-SHEET="Para Large Indent" FSL="Default" -->
<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Each employment
agreement also provides that each executive will not compete with the Company or hire any
employees of the Company for a period of one year after the termination of the
executive&#146;s employment, unless employment is terminated by the Company without cause
or by the executive for good reason. </FONT></P>

<!-- MARKER FORMAT-SHEET="Para Large Indent" FSL="Default" -->
<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;If
employment of any of our named executive officers is terminated in a situation not
involving a change in control, the chart below sets forth the severance payments that
would have been made based on a hypothetical termination date of December 31, 2006 and
using the closing price of our stock on that date. These amounts are estimates and the
actual amounts to be paid can only be determined at the time of the termination of the
executive&#146;s employment. </FONT></P>

<!-- MARKER FORMAT-SHEET="Head Major Center Bold 1" FSL="Default" -->
<H1 ALIGN=CENTER><FONT SIZE=3>Termination of
Employment Without Change In Control </FONT></H1>

<PRE>
<FONT SIZE=1>
                                                  Value of Accelerated
                            Cash Compensation       Vesting of Stock       Medical and Other
Name                       (Salary and Bonus)($)       Awards ($)            Benefits ($)             Total ($)
- --------------------       ---------------------  --------------------     -----------------          ---------
Leo S. Ullman                   2,295,161                718,742                 9,955                3,023,858
Thomas J. O'Keeffe              1,347,993                303,310                19,031                1,670,334
Brenda J. Walker                  925,771                170,282                 3,425                1,099,478
Thomas B. Richey                1,160,493                345,130                14,708                1,520,331
Nancy H. Mozzachio              1,044,554                131,642                 9,955                1,186,151
</FONT>
</PRE>

<!-- MARKER FORMAT-SHEET="Para Large Indent" FSL="Default" -->
<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;If
employment of any of our named executive officers is terminated in connection with a
change in control, the chart below sets forth the change in control payments that would
have been made based on a hypothetical termination date of December 31, 2006 and using the
closing price of our stock on that date. These amounts are estimates and the actual
amounts to be paid can only be determined at the time of the termination of the
executive&#146;s employment. </FONT></P>

<!-- MARKER FORMAT-SHEET="Head Major Center Bold 1" FSL="Default" -->
<H1 ALIGN=CENTER><FONT SIZE=3>Termination of
Employment In Connection With Change In Control </FONT></H1>

<PRE>
<FONT SIZE=1>
                                                Value of
                        Cash Compensation      Accelerated
                          (Salary and       Vesting of Stock       Tax Gross      Medical and Other
Name                       Bonus) ($)          Awards ($)          Up ($)(1)         Benefits ($)        Total ($)
- ------------------      ------------------  ----------------       ----------     ------------------     ---------
Leo S. Ullman               2,295,161             718,742          1,323,810             9,955           4,347,668
Thomas J. O'Keeffe          1,347,993             303,310            673,516            19,031           2,343,850
Brenda J. Walker              925,771             170,282            456,614             3,425           1,556,092
Thomas B. Richey            1,160,493             345,130            662,572            14,708           2,182,903
Nancy H. Mozzachio          1,044,554             131,642            483,911             9,955           1,670,062
</FONT>
</PRE>

<!-- MARKER FORMAT-SHEET="Cutoff Rule" FSL="Default" -->
<P>_________________ </P>

<!-- MARKER FORMAT-SHEET="Para (List) Hang Level 1" FSL="Workstation" -->
          <TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0>
               <TR VALIGN=TOP>
               <TD WIDTH=5%><FONT SIZE=3>(1) </FONT></TD>
               <TD WIDTH=95%><P ALIGN=LEFT><FONT SIZE=3>
               Upon a change in control, several of the Company&#146;s executives may be
               subject to certain excise taxes under Section 280G of the Internal Revenue Code
               of 1986, as amended. The Company has agreed to reimburse the affected executives
               for those excise taxes as well as for any income and excise taxes payable by the
               executives as a result of any such reimbursement. The amounts in this column are
               based on an excise tax rate of 20% and a total income tax rate of 40% to cover
               federal, state and other payroll-related taxes. </FONT></P></TD>
               </TR>
               </TABLE>
               <BR>

<!-- MARKER FORMAT-SHEET="Stroock Head Left" FSL="Default" -->
<P ALIGN=LEFT><FONT SIZE=3><U>Equity Awards</U></FONT></P>

<!-- MARKER FORMAT-SHEET="Para Large Indent" FSL="Workstation" -->
<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
following table sets forth certain information with respect to the grant of equity awards
for the fiscal year ended December 31, 2006. </FONT></P>

<!-- MARKER FORMAT-SHEET="Stroock Head Major Center Bold" FSL="Default" -->
<P ALIGN=CENTER><FONT SIZE=3><B>GRANTS OF PLAN-BASED AWARDS FOR YEAR ENDED DECEMBER 31,
2006 </B></FONT></P>

<PRE>
<FONT SIZE=1>
- --------------------------------------------------------------------------------------------------------------------
Name        Grant    Estimated Future Payouts    Estimated Future Payouts    All Other   All Other   Exercis  Grant
             Date              Under              Under Equity Incentive       Stock       Option    or       Date
                       Non-Equity Incentive             Plan Awards           Awards:     Awards:    Base     Full
                            Plan Awards                                      Number of   Number of   Price    Fair
                                                                             Shares of   Securities  of       Value
                                                                             Stock or    Underlying  Option   (5) ($)
                                                                               Units      Options    Awards
                                                                              (#) (1)       (#)      ($/Sh)
- ----------------------------------------------------------------------------------------------------------------------
                    Threshold Target   Maximum  Threshold Target   Maximum
                      ($)      ($)       ($)      (#)      (#)       (#)
                                                           (1)

- ----------------------------------------------------------------------------------------------------------------------
Leo S.     10/25/06                                      17,768(2)           17,768(3)                        835,932
Ullman        1/1/07                                                         20,646(4)
- ----------------------------------------------------------------------------------------------------------------------
Thomas J.  10/25/06                                      5,330(2)             5,330(3)                        384,097
O'Keeffe      1/1/07                                                         14,574(4)
- ----------------------------------------------------------------------------------------------------------------------
Brenda J.  10/25/06                                      3,021(2)             3,021(3)                        213,814
Walker        1/1/07                                                          8,016(4)
- ----------------------------------------------------------------------------------------------------------------------
Thomas B.  10/25/06                                      7,107(2)             7,107(3)                        434,848
Richey        1/1/07                                                         14,574(4)
- ----------------------------------------------------------------------------------------------------------------------
Nancy H.   10/25/06                                      1,777(2)             1,777(3)                        186,002
Mozzachio     1/1/07                                                          8,501(4)
- ----------------------------------------------------------------------------------------------------------------------
</FONT>
</PRE>

<!-- MARKER FORMAT-SHEET="Para (List) Hang Level 1" FSL="Default" -->
          <TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0>
               <TR VALIGN=TOP>
               <TD WIDTH=5%><FONT SIZE=3>(1) </FONT></TD>
               <TD WIDTH=95%><P ALIGN=LEFT><FONT SIZE=3>
               Does not include dividends received on such shares from January 1, 2006 until
               the date of issuance of the stock. </FONT></P></TD>
               </TR>
               </TABLE>
               <BR>

<!-- MARKER FORMAT-SHEET="Para (List) Hang Level 1" FSL="Default" -->
          <TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0>
               <TR VALIGN=TOP>
               <TD WIDTH=5%><FONT SIZE=3>(2) </FONT></TD>
               <TD WIDTH=95%><P ALIGN=LEFT><FONT SIZE=3>
               This column shows the number of restricted shares granted to the named
               executives that will vest at the end of a three-year performance period
               (commencing January 1, 2006 and ending December 31, 2008) which are
               market-driven and therefore completely at risk. See the CDA for a description of
               the performance goals. </FONT></P></TD>
               </TR>
               </TABLE>
               <BR>

<!-- MARKER FORMAT-SHEET="Para (List) Hang Level 1" FSL="Default" -->
          <TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0>
               <TR VALIGN=TOP>
               <TD WIDTH=5%><FONT SIZE=3>(3) </FONT></TD>
               <TD WIDTH=95%><P ALIGN=LEFT><FONT SIZE=3>
               These are restricted shares granted to the named executives representing the
               time-based portion of long-term compensation (see CDA) that will vest three
               years from the date of grant. </FONT></P></TD>
               </TR>
               </TABLE>
               <BR>

<!-- MARKER FORMAT-SHEET="Para (List) Hang Level 1" FSL="Default" -->
          <TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0>
               <TR VALIGN=TOP>
               <TD WIDTH=5%><FONT SIZE=3>(4) </FONT></TD>
               <TD WIDTH=95%><P ALIGN=LEFT><FONT SIZE=3>
               These are restricted shares granted to the named executives representing the
               stock portion of the annual bonus (see CDA) that will vest three years from the
               date of grant. </FONT></P></TD>
               </TR>
               </TABLE>
               <BR>

<!-- MARKER FORMAT-SHEET="Para (List) Hang Level 1" FSL="Default" -->
          <TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0>
               <TR VALIGN=TOP>
               <TD WIDTH=5%><FONT SIZE=3>(5) </FONT></TD>
               <TD WIDTH=95%><P ALIGN=LEFT><FONT SIZE=3>
               This column shows the grant date full fair value of restricted share grants to
               the named executives for 2006 under SFAS 123R (including the restricted share
               portion of the 2006 bonus, as reflected in the Summary Compensation Table). For
               restricted share grants, fair value is determined (1)&nbsp;for time-based grants
               as the market price of the Company&#146;s common stock on the date of grant and
               (2)&nbsp;for market/performance-based grants by an independent appraisal. </FONT></P></TD>
               </TR>
               </TABLE>
               <BR>

<!-- MARKER FORMAT-SHEET="Para Large Indent" FSL="Workstation" -->
<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;No
options were granted by the Company or exercised during the fiscal year ended December 31,
2006 nor did any stock vest in 2006. The following table sets forth certain information
with respect to option exercises and option values and stock awards for the fiscal year
ended December 31, 2006. </FONT></P>

<!-- MARKER FORMAT-SHEET="Stroock Head Major Center Bold" FSL="Default" -->
<P ALIGN=CENTER><FONT SIZE=3><B>OUTSTANDING EQUITY AWARDS AT FISCAL YEAR&#150;END FOR
YEAR ENDED DECEMBER 31, 2006 </B></FONT></P>

<PRE>
<FONT SIZE=1>
- --------------- ------------------------------------------------------------- -------------------------------------------
                                       Option Awards                                         Stock Awards
- --------------- ------------ ------------- ------------ --------- ----------- ---------- --------- --------- ------------
     Name        Number of    Number of      Equity     Option      Option    Number     Market    Equity      Equity
                Securities    Securities    Incentive   Exercise  Expiration  of         Value     Incentive  Incentive
                Underlying    Underlying      Plan       Price       Date     Shares     of        Plan         Plan
                Unexercised  Unexercised     Awards:      ($)                 or Units   Shares    Awards:     Awards:
                  Options      Options      Number of                         of Stock   or        Number     Market or
                    (#)          (#)       Securities                         That       Units     of          Payout
                Exercisable  Unexercisable Underlying                         Have Not   of        Unearned   Value of
                                           Unexercised                         Vested    Stock     Shares,    Unearned
                                            Unearned                             (#)     That      Units       Shares,
                                             Options                                     Have      or         Units or
                                               (#)                                       Not       Other        Other
                                                                                          Vested   Rights      Rights
                                                                                           ($)     That       That Have
                                                                                           (1)     Have      Not Vested
                                                                                                   Not           ($)
                                                                                                    Vested       (1)
                                                                                                     (#)
                                                                                                     (5)
- --------------- ------------ ------------- ------------ --------- ----------- ---------- --------- --------- ------------
Leo S. Ullman      3,333                                 10.50    7/10/2011   27,700(2)  440,707   17,768    282,689
                                                                              17,768(3)  282,689
                                                                              20,646(4)  328,478
- --------------- ------------ ------------- ------------ --------- ----------- ---------- --------- --------- ------------
Thomas J.                                                                     12,200(2)   194,102   5,330     84,800
O'Keeffe                                                                       5,330(3)    84,800
                                                                              14,574(4)   231,872
- --------------- ------------ ------------- ------------ --------- ----------- ---------- --------- --------- ------------
Brenda J.          3,333                                 10.50    7/10/2011    7,000(2)   111,370   3,021     48,064
Walker                                                                         3,021(3)    48,064
                                                                               8,016(4)   127,535
- --------------- ------------ ------------- ------------ --------- ----------- ---------- --------- --------- ------------
Thomas B.                                                                     12,200(2)   194,102   7,107    113,072
Richey                                                                         7,107(3)   113,072
                                                                              14,574(4)   231,872
- --------------- ------------ ------------- ------------ --------- ----------- ---------- --------- --------- ------------
Nancy H.                                                                       3,600(2)    57,276   1,777     28,272
Mozzachio                                                                      1,777(3)    28,272
                                                                               8,501(4)   135,251
- --------------- ------------ ------------- ------------ --------- ----------- ---------- --------- --------- ------------
</FONT>
</PRE>

     <P><FONT SIZE=3>(1)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
          Based on the closing price of a share of common stock on December 31, 2006.</FONT></P>

     <P><FONT SIZE=3>(2)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
          These shares vest on September 13, 2008.</FONT></P>

     <P><FONT SIZE=3>(3)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
          These shares vest on October 25, 2009.</FONT></P>

     <P><FONT SIZE=3>(4)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
          These shares vest on January 1, 2010.</FONT></P>

     <P><FONT SIZE=3>(5)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
          These shares vest on December 31, 2008.</FONT></P>

<!-- MARKER FORMAT-SHEET="Head Major Left Bold" FSL="Default" -->
<H1 ALIGN=LEFT><FONT SIZE=3>Compensation of Directors </FONT></H1>

<!-- MARKER FORMAT-SHEET="Para Large Indent" FSL="Default" -->
<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Prior
to July 1, 2006, independent directors&#146; fees were $20,000 per year and meeting
attendance fees were $1,000 for each Board and Committee meeting. Audit Committee members
(other than the chairman) also receive a flat fee of $4,000 per year, while other
committee members (other than the chairmen) received a flat fee of $3,000 per year. The
chairman of the Audit Committee received $10,000 per year and the chairmen of the other
committees received $4,000 per year. The annual Directors fees, at the option of each
Director, may be paid in cash or shares of the Company&#146;s common stock. Each Director
(other than Directors who are members of management) also was to receive an annual grant
of $30,000 of restricted stock that would vest on the third anniversary of the date of
grant. </FONT></P>

<!-- MARKER FORMAT-SHEET="Para Large Indent" FSL="Default" -->
<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
Compensation Committee retained a compensation consulting firm, Chernoff Diamond &amp;
Co., LLC, to assist the Committee in determining the appropriate compensation to be paid
to our independent directors. Director compensation was compared to the same 14 peer group
of companies used by the consultant to recommend executive compensation. The consultant
determined that total compensation of the directors was generally consistent with the peer
group, with cash compensation being above the peer group and equity compensation being
below the peer group. The director data was for the 2005 fiscal year of the peer group. </FONT></P>

<!-- MARKER FORMAT-SHEET="Para Large Indent" FSL="Default" -->
<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
consultant determined that since our company was towards the small end of the peer group,
a reasonable target for total director compensation would be at or a little below the
median (between $90,000 and $95,000 per annum). In 2005, on average our directors received
an aggregate of $91,666 in total compensation; however, in 2005 we had 20 board of
directors meetings compared to an average of nine meetings for our peers. The observation
of the consultant was that although actual total reimbursement of directors was in line
with the peers, the rate of pay for certain of the compensation elements (the annual
equity grant, board attendance fee and annual retainers paid to the chairmen of certain
committees) were below the median of the peers. </FONT></P>

<!-- MARKER FORMAT-SHEET="Para Large Indent" FSL="Default" -->
<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
Compensation Committee reviewed the analysis of the consultant and concluded that the
number of board meetings in 2006 and beyond would probably be reduced substantially from
the 20 meetings held in 2005, therefore reducing total remuneration to our directors. </FONT></P>

<!-- MARKER FORMAT-SHEET="Para Large Indent" FSL="Default" -->
<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
Committee concluded that, based on the workload and responsibilities of the directors and
the trend of annual increases in director compensation being made by public companies, it
was appropriate to increase director compensation. In addition, the Compensation Committee
recognized that the consultant&#146;s data was for 2005. Accordingly, effective July 1,
2006, director compensation was increased as follows: the annual retainer was increased
from $20,000 to $25,000; the board meeting attendance fee was increased from $1,000 to
$1,500; the annual restricted stock grant was increased from $30,000 to $40,000; the
retainer for the chairman of the Audit Committee was increased from $10,000 to $12,000;
the retainer for the chairman of the Compensation Committee was increased from $4,000 to
$7,500; the retainer for the chairman of the Nominating/Corporate Governance Committee was
increased from $4,000 to $5,500; and the annual retainer for the lead director was set at
$15,000. </FONT></P>

<!-- MARKER FORMAT-SHEET="Para Large Indent" FSL="Default" -->
<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
following table provides information regarding Director compensation in 2006, which
reflects the compensation described above. The table does not include reimbursement of
travel expenses related to attending Board and Committee meetings. Mr. Ullman and Ms.
Walker do not receive additional compensation for serving as directors. </FONT></P>

<!-- MARKER FORMAT-SHEET="Head Major Center Bold 1" FSL="Default" -->
<H1 ALIGN=CENTER><FONT SIZE=3>Director Compensation
&#151; 2006 </FONT></H1>

<TABLE CELLPADDING=0 CELLSPACING=0 BORDER=0 WIDTH=100%>
<TR VALIGN=Bottom>
     <TH COLSPAN=2 ALIGN=LEFT>Name<HR WIDTH=75% SIZE=1 COLOR=BLACK NOSHADE></TH>
     <TH COLSPAN=2>Fees Earned or Paid<BR>
in Cash ($) (1)<HR WIDTH=75% SIZE=1 COLOR=BLACK NOSHADE></TH>
     <TH COLSPAN=2>Stock Awards ($) (2)<HR WIDTH=75% SIZE=1 COLOR=BLACK NOSHADE></TH>
     <TH COLSPAN=2>Total ($)<HR WIDTH=75% SIZE=1 COLOR=BLACK NOSHADE></TH></TR>
<TR VALIGN=Bottom>
     <TD WIDTH=44% ALIGN=LEFT>James J. Burns</TD>
     <TD WIDTH=5% ALIGN=LEFT>&nbsp;</TD>
     <TD WIDTH=13% ALIGN=RIGHT>66,193</TD>
        <TD WIDTH=5% ALIGN=LEFT>&nbsp;</TD>
     <TD WIDTH=13% ALIGN=RIGHT>55,211</TD>
        <TD WIDTH=5% ALIGN=LEFT>&nbsp;</TD>
     <TD WIDTH=13% ALIGN=RIGHT>121,404</TD>
        <TD WIDTH=2% ALIGN=LEFT>&nbsp;</TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT>Richard Homburg</TD><TD ALIGN=LEFT>&nbsp;</TD>
     <TD ALIGN=RIGHT>30,193</TD>
        <TD ALIGN=LEFT>&nbsp;</TD>
     <TD ALIGN=RIGHT>30,085</TD>
        <TD ALIGN=LEFT>&nbsp;</TD>
     <TD ALIGN=RIGHT>60,278</TD>
        <TD ALIGN=LEFT>&nbsp;</TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT>Paul G. Kirk, Jr</TD><TD ALIGN=LEFT>&nbsp;</TD>
     <TD ALIGN=RIGHT>55,258</TD>
        <TD ALIGN=LEFT>&nbsp;</TD>
     <TD ALIGN=RIGHT>19,025</TD>
        <TD ALIGN=LEFT>&nbsp;</TD>
     <TD ALIGN=RIGHT>74,283</TD>
        <TD ALIGN=LEFT>&nbsp;</TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT>Everett B. Miller, III</TD><TD ALIGN=LEFT>&nbsp;</TD>
     <TD ALIGN=RIGHT>47,943</TD>
        <TD ALIGN=LEFT>&nbsp;</TD>
     <TD ALIGN=RIGHT>55,211</TD>
        <TD ALIGN=LEFT>&nbsp;</TD>
     <TD ALIGN=RIGHT>103,154</TD>
        <TD ALIGN=LEFT>&nbsp;</TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT>Roger M. Widmann</TD><TD ALIGN=LEFT>&nbsp;</TD>
     <TD ALIGN=RIGHT>56,943</TD>
        <TD ALIGN=LEFT>&nbsp;</TD>
     <TD ALIGN=RIGHT>30,085</TD>
        <TD ALIGN=LEFT>&nbsp;</TD>
     <TD ALIGN=RIGHT>87,028</TD>
        <TD ALIGN=LEFT>&nbsp;</TD></TR>
</TABLE>
<BR>

<!-- MARKER FORMAT-SHEET="Para (List) Hang Level 1" FSL="Default" -->
          <TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0>
               <TR VALIGN=TOP>
               <TD WIDTH=5%><FONT SIZE=3>(1) </FONT></TD>
               <TD WIDTH=95%><P ALIGN=LEFT><FONT SIZE=3>
               Messrs. Miller and Widmann each contributed a portion of their fees to the 2005
               Cedar Shopping Centers, Inc. Deferred Compensation Plan. </FONT></P></TD>
               </TR>
               </TABLE>
               <BR>

<!-- MARKER FORMAT-SHEET="Para (List) Hang Level 1" FSL="Default" -->
          <TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0>
               <TR VALIGN=TOP>
               <TD WIDTH=5%><FONT SIZE=3>(2) </FONT></TD>
               <TD WIDTH=95%><P ALIGN=LEFT><FONT SIZE=3>
               This column represents the dollar amount charged to operations for financial
               statement reporting purposes during 2006 with respect to all restricted stock
               grants (for 2006 as well as for prior years), in accordance with SFAS No.
               123R. Messrs. Burns and Miller each has outstanding options to purchase 3,333
               shares of Common Stock of the Company. Each director has the following total
               number of restricted shares which have not yet vested: James J. Burns, 7,796;
               Richard Homburg, 6,200; Paul G. Kirk, Jr., 4,600; Everett B. Miller, III, 7,796;
               and Roger M. Widmann, 6,200. All these shares are included in the security
               ownership chart for directors and executive officers. </FONT></P></TD>
               </TR>
               </TABLE>
               <BR>

<!-- MARKER FORMAT-SHEET="Head Major Left Bold" FSL="Default" -->
<H1 ALIGN=LEFT><FONT SIZE=3>Stock Plans </FONT></H1>

<!-- MARKER FORMAT-SHEET="Para Large Indent" FSL="Default" -->
<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
Company has in effect the 2004 Stock Incentive Plan (the &#147;Incentive Plan&#148;) and
the 1998 Stock Option Plan (the &#147;Option Plan&#148;). Under the Incentive Plan, a
total of 850,000 shares of common stock may be issued. In connection with the adoption of
the Incentive Plan, the Company agreed that it would not issue any more options under the
Option Plan. The Plans are administered by the Compensation Committee, which determines,
among other things, the number of shares subject to each grant, the vesting period for
each grant and the exercise price (subject to applicable regulations with respect to
incentive stock options) for the awards. </FONT></P>

<!-- MARKER FORMAT-SHEET="Para Large Indent" FSL="Default" -->
<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
following table sets forth information at March 31, 2007 regarding the existing
compensation plans and individual compensation arrangements pursuant to which the
Company&#146;s equity securities are authorized for issuance to employees or non-employees
(such as directors, consultants, advisors, vendors, customers, suppliers, or lenders) in
exchange for consideration in the form of goods and services. </FONT></P>

<P ALIGN=CENTER><FONT SIZE=3><B>Equity Compensation</B></FONT></P>

<TABLE CELLPADDING=0 CELLSPACING=0 BORDER=0 WIDTH=100%>
<TR VALIGN=Bottom>
     <TH COLSPAN=2></TH>
     <TH COLSPAN=2>A<HR WIDTH=90% SIZE=1 COLOR=BLACK NOSHADE></TH>
     <TH COLSPAN=2>B<HR WIDTH=90% SIZE=1 COLOR=BLACK NOSHADE></TH>
     <TH COLSPAN=2>C<HR WIDTH=90% SIZE=1 COLOR=BLACK NOSHADE></TH></TR>
<TR VALIGN=Bottom>
     <TH COLSPAN=2>Plan Category<HR WIDTH=90% SIZE=1 COLOR=BLACK NOSHADE></TH>
     <TH COLSPAN=2>Number of<BR>
Securities to be<BR>
Issued Upon<BR>
Exercise of<BR>
Outstanding<BR>
Options,<BR>
Warrants and<BR>
Rights<HR WIDTH=90% SIZE=1 COLOR=BLACK NOSHADE></TH>
     <TH COLSPAN=2>Weighted-Average<BR>
Exercise Price<BR>
of Outstanding<BR>
Options,<BR>
Warrants and<BR>
Rights<HR WIDTH=90% SIZE=1 COLOR=BLACK NOSHADE></TH>
     <TH COLSPAN=2>Number of<BR>
Securities<BR>
Remaining Available<BR>
for Future<BR>
Issuances Under<BR>
Equity Compensation<BR>
Plans (Excluding<BR>
Securities<BR>
in Column A)<HR WIDTH=90% SIZE=1 COLOR=BLACK NOSHADE></TH></TR>
<TR VALIGN=Bottom>
     <TD WIDTH=54% ALIGN=LEFT>Equity compensation plans approved by</TD>
     <TD WIDTH=4% ALIGN=LEFT>&nbsp;</TD>
     <TD WIDTH=9% ALIGN=RIGHT><BR>13,332</TD>
        <TD WIDTH=4% ALIGN=LEFT>&nbsp;</TD>
     <TD WIDTH=14% ALIGN=RIGHT><BR>$10.50</TD>
        <TD WIDTH=4% ALIGN=LEFT></TD>
     <TD WIDTH=9% ALIGN=RIGHT><BR>495,184</TD>
        <TD WIDTH=2% ALIGN=LEFT>&nbsp;</TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT>security holders</TD><TD ALIGN=LEFT>&nbsp;</TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT>Equity compensation plans not approved by</TD><TD ALIGN=LEFT>&nbsp;</TD>
     <TD ALIGN=RIGHT><BR>83,333</TD>
        <TD ALIGN=LEFT>&nbsp;</TD>
     <TD ALIGN=RIGHT><BR>$13.50</TD>
        <TD ALIGN=LEFT></TD>
     <TD ALIGN=RIGHT><BR>--</TD>
        <TD ALIGN=LEFT>&nbsp;</TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT>security holders</TD><TD ALIGN=LEFT>&nbsp;</TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT>Total</TD><TD ALIGN=LEFT>&nbsp;</TD>
     <TD ALIGN=RIGHT>96,665</TD>
        <TD ALIGN=LEFT>&nbsp;</TD>
     <TD ALIGN=RIGHT>&nbsp;</TD>
        <TD ALIGN=LEFT></TD>
     <TD ALIGN=RIGHT>495,184</TD>
        <TD ALIGN=LEFT>&nbsp;</TD></TR>
</TABLE>


<!-- MARKER FORMAT-SHEET="Head Major Left Bold" FSL="Default" -->
<H1 ALIGN=LEFT><FONT SIZE=3>Compensation Committee
Interlocks and Insider Participation </FONT></H1>

<!-- MARKER FORMAT-SHEET="Para Large Indent" FSL="Default" -->
<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;James
J. Burns, Paul G. Kirk, Jr., Everett B. Miller, III and Roger M. Widmann are members of
the Compensation Committee. None of the executive officers of the Company has served on
the Board of Directors or Compensation Committee of any other entity that has had any of
such entity&#146;s executive officers serve either on the Company&#146;s Board of
Directors or Compensation Committee. </FONT></P>

<!-- MARKER FORMAT-SHEET="Head Major Left Bold" FSL="Default" -->
<H1 ALIGN=LEFT><FONT SIZE=3>Security Ownership of
Certain Beneficial Owners and Management </FONT></H1>

<!-- MARKER FORMAT-SHEET="Para Large Indent" FSL="Default" -->
<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
following is a schedule of all persons who, to the knowledge of the Company, beneficially
owned more than 5% of the outstanding common stock of the Company as of February 15, 2007: </FONT></P>


<TABLE CELLPADDING=0 CELLSPACING=0 BORDER=0 WIDTH=100%>
<TR VALIGN=Bottom>
     <TH COLSPAN=2 ALIGN=LEFT>Name and Address<HR WIDTH=75% SIZE=1 COLOR=BLACK NOSHADE></TH>
     <TH COLSPAN=2>Number of Shares<BR>
Beneficially Owned<HR WIDTH=75% SIZE=1 COLOR=BLACK NOSHADE></TH>
     <TH COLSPAN=2>Percent<BR>
of Stock<HR WIDTH=75% SIZE=1 COLOR=BLACK NOSHADE></TH></TR>
<TR VALIGN=Bottom>
     <TD WIDTH=65% ALIGN=LEFT><BR>Cohen &amp; Steers Capital Management, Inc.</TD>
     <TD WIDTH=4% ALIGN=LEFT>&nbsp;</TD>
     <TD WIDTH=14% ALIGN=RIGHT>5,632,800</TD>
        <TD WIDTH=4% ALIGN=LEFT>&nbsp;</TD>
     <TD WIDTH=13% ALIGN=CENTER>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;12.8%</TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT>280 Park Avenue</TD><TD ALIGN=LEFT>&nbsp;</TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT>New York, NY 10017</TD><TD ALIGN=LEFT>&nbsp;</TD>
     <TD ALIGN=RIGHT></TD>
        <TD ALIGN=LEFT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><BR>FMR Corp.</TD><TD ALIGN=LEFT>&nbsp;</TD>
     <TD ALIGN=RIGHT>4,218,336</TD>
        <TD ALIGN=LEFT>&nbsp;</TD>
     <TD ALIGN=CENTER>9.6%</TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT>82 Devonshire Street</TD><TD ALIGN=LEFT>&nbsp;</TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT>Boston, MA 02109</TD><TD ALIGN=LEFT>&nbsp;</TD>
     <TD ALIGN=RIGHT></TD>
        <TD ALIGN=LEFT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><BR>Snyder Capital Management, L.P. and</TD><TD ALIGN=LEFT>&nbsp;</TD>
     <TD ALIGN=RIGHT>2,947,520</TD>
        <TD ALIGN=LEFT>&nbsp;</TD>
     <TD ALIGN=CENTER>6.7%</TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT>Snyder Capital Management, Inc. (1)</TD><TD ALIGN=LEFT>&nbsp;</TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT>One Market Plaza, Suite 1200</TD><TD ALIGN=LEFT>&nbsp;</TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT>San Francisco, CA 94105</TD><TD ALIGN=LEFT>&nbsp;</TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><BR>The Vanguard Group, Inc.</TD><TD ALIGN=LEFT>&nbsp;</TD>
     <TD ALIGN=RIGHT>2,414,378</TD>
        <TD ALIGN=LEFT>&nbsp;</TD>
     <TD ALIGN=CENTER>5.5%</TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT>100 Vanguard Blvd</TD><TD ALIGN=LEFT>&nbsp;</TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT>Malverne, PA 19355</TD><TD ALIGN=LEFT>&nbsp;</TD>
     <TD ALIGN=RIGHT></TD>
        <TD ALIGN=LEFT></TD></TR>
</TABLE>

<!-- MARKER FORMAT-SHEET="Cutoff Rule" FSL="Default" -->
<P>_________________ </P>

<!-- MARKER FORMAT-SHEET="Para (List) Hang Level 1" FSL="Default" -->
          <TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0>
               <TR VALIGN=TOP>
               <TD WIDTH=5%><FONT SIZE=3>(1) </FONT></TD>
               <TD WIDTH=95%><P ALIGN=LEFT><FONT SIZE=3>
               According to a Schedule 13G, these shares are owned under shared dispositive
               power. Moreover, the direct parent company of Snyder Capital Management, L.P.
               (&#147;SCMLP&#148;), and Snyder Capital Management, Inc. (&#147;SCMI&#148;), is
               IXIS Asset Management North America, L.P. (&#147;IXIS&#148;), which is
               ultimately owned by three large affiliated French financial services firms. SCMI
               and IXIS operate under an understanding that all investment and voting decisions
               regarding managed accounts are to be made by SCMI and SCMLP and not by IXIS or
               any entity controlling it. Accordingly, SCMI and SCMLP do not consider IXIS
               Asset Management North America or any entity controlling it to have any direct
               or indirect control over the securities held in managed accounts. </FONT></P></TD>
               </TR>
               </TABLE>
               <BR>

<!-- MARKER FORMAT-SHEET="Para Large Indent" FSL="Default" -->
<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
following table sets forth information concerning the security ownership of directors and
executive officers as of March 31, 2007: </FONT></P>


<TABLE CELLPADDING=0 CELLSPACING=0 BORDER=0 WIDTH=100%>
<TR VALIGN=Bottom>
     <TH COLSPAN=2 ALIGN=LEFT>Name<HR WIDTH=75% SIZE=1 COLOR=BLACK NOSHADE></TH>
     <TH COLSPAN=2>Number of Shares<BR>
Beneficially Owned(1)<HR WIDTH=75% SIZE=1 COLOR=BLACK NOSHADE></TH>
     <TH COLSPAN=2>Percent<BR>
of Stock(2)<HR WIDTH=75% SIZE=1 COLOR=BLACK NOSHADE></TH></TR>
<TR VALIGN=Bottom>
     <TD WIDTH=65% ALIGN=LEFT><BR>Leo S. Ullman (3)</TD>
     <TD WIDTH=1% ALIGN=LEFT>&nbsp;</TD>
     <TD WIDTH=17% ALIGN=RIGHT>694,405</TD>
        <TD WIDTH=6% ALIGN=LEFT>&nbsp;</TD>
     <TD WIDTH=9% ALIGN=CENTER>1.6%</TD>
     <TD WIDTH=2% ALIGN=LEFT>&nbsp;</TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><BR>James J. Burns (4)</TD><TD ALIGN=LEFT>&nbsp;</TD>
     <TD ALIGN=RIGHT>16,123</TD>
        <TD ALIGN=LEFT>&nbsp;</TD>
     <TD ALIGN=CENTER>*</TD><TD ALIGN=LEFT>&nbsp;</TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><BR>Richard Homburg (5)</TD><TD ALIGN=LEFT>&nbsp;</TD>
     <TD ALIGN=RIGHT>58,800</TD>
        <TD ALIGN=LEFT>&nbsp;</TD>
     <TD ALIGN=CENTER>*</TD><TD ALIGN=LEFT>&nbsp;</TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><BR>Paul G. Kirk, Jr</TD><TD ALIGN=LEFT>&nbsp;</TD>
     <TD ALIGN=RIGHT>7,200</TD>
        <TD ALIGN=LEFT>&nbsp;</TD>
     <TD ALIGN=CENTER>*</TD><TD ALIGN=LEFT>&nbsp;</TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><BR>Everett B. Miller III (4)</TD><TD ALIGN=LEFT>&nbsp;</TD>
     <TD ALIGN=RIGHT>16,156</TD>
        <TD ALIGN=LEFT>&nbsp;</TD>
     <TD ALIGN=CENTER>*</TD><TD ALIGN=LEFT>&nbsp;</TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><BR>Brenda J. Walker (6)</TD><TD ALIGN=LEFT>&nbsp;</TD>
     <TD ALIGN=RIGHT>151,873</TD>
        <TD ALIGN=LEFT>&nbsp;</TD>
     <TD ALIGN=CENTER>*</TD><TD ALIGN=LEFT>&nbsp;</TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><BR>Roger M. Widmann</TD><TD ALIGN=LEFT>&nbsp;</TD>
     <TD ALIGN=RIGHT>9,800</TD>
        <TD ALIGN=LEFT>&nbsp;</TD>
     <TD ALIGN=CENTER>*</TD><TD ALIGN=LEFT>&nbsp;</TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><BR>Thomas J. O'Keeffe</TD><TD ALIGN=LEFT>&nbsp;</TD>
     <TD ALIGN=RIGHT>205,893</TD>
        <TD ALIGN=LEFT>&nbsp;</TD>
     <TD ALIGN=CENTER>*</TD><TD ALIGN=LEFT>&nbsp;</TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><BR>Thomas B. Richey</TD><TD ALIGN=LEFT>&nbsp;</TD>
     <TD ALIGN=RIGHT>105,674</TD>
        <TD ALIGN=LEFT>&nbsp;</TD>
     <TD ALIGN=CENTER>*</TD><TD ALIGN=LEFT>&nbsp;</TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><BR>Nancy H. Mozzachio</TD><TD ALIGN=LEFT>&nbsp;</TD>
     <TD ALIGN=RIGHT>22,233</TD>
        <TD ALIGN=LEFT>&nbsp;</TD>
     <TD ALIGN=CENTER>*</TD><TD ALIGN=LEFT>&nbsp;</TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><BR>Directors and executive officers as a group (11 persons) (7)</TD><TD ALIGN=LEFT>&nbsp;</TD>
     <TD ALIGN=RIGHT>1,334,612</TD>
        <TD ALIGN=LEFT>&nbsp;</TD>
     <TD ALIGN=CENTER>3.0%</TD><TD ALIGN=LEFT>&nbsp;</TD></TR>
</TABLE>


<!-- MARKER FORMAT-SHEET="Cutoff Rule" FSL="Default" -->
<P>_________________ </P>

<!-- MARKER FORMAT-SHEET="Stroock Head Left" FSL="Default" -->
<P ALIGN=LEFT><FONT SIZE=3>* Less than 1%</FONT></P>

<!-- MARKER FORMAT-SHEET="Para (List) Hang Level 1" FSL="Default" -->
          <TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0>
               <TR VALIGN=TOP>
               <TD WIDTH=5%><FONT SIZE=3>(1) </FONT></TD>
               <TD WIDTH=95%><P ALIGN=LEFT><FONT SIZE=3>
               Beneficial ownership is determined in accordance with the rules of the
               Securities and Exchange Commission and generally includes voting or investment
               power with respect to securities. Shares of common stock subject to options
               currently exercisable or exercisable within 60 days of the date hereof, are
               deemed outstanding for computing the percentage of the person holding such
               options but are not deemed outstanding for computing the percentage of any other
               person. </FONT></P></TD>
               </TR>
               </TABLE>
               <BR>

<!-- MARKER FORMAT-SHEET="Para (List) Hang Level 1" FSL="Default" -->
          <TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0>
               <TR VALIGN=TOP>
               <TD WIDTH=5%><FONT SIZE=3>(2) </FONT></TD>
               <TD WIDTH=95%><P ALIGN=LEFT><FONT SIZE=3>
               Percentage amount assumes the exercise by such persons of all options to acquire
               shares of common stock or exchange of limited partnership interests in Cedar
               Shopping Centers Partnership, L.P. for shares of common stock and no exercise or
               exchange by any other person. </FONT></P></TD>
               </TR>
               </TABLE>
               <BR>

<!-- MARKER FORMAT-SHEET="Para (List) Hang Level 1" FSL="Default" -->
          <TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0>
               <TR VALIGN=TOP>
               <TD WIDTH=5%><FONT SIZE=3>(3) </FONT></TD>
               <TD WIDTH=95%><P ALIGN=LEFT><FONT SIZE=3>
               Includes options to purchase 3,333 shares of common stock and 296,670 limited
               partnership interests in Cedar Shopping Centers Partnership, L.P. exchangeable
               for an equal number of shares of common stock of the Company (&#147;OP
               Units&#148;). 113,245 of the shares of common stock owned by Mr. Ullman are
               pledged to a bank to secure a loan made by such bank to Mr. Ullman. </FONT></P></TD>
               </TR>
               </TABLE>
               <BR>

<!-- MARKER FORMAT-SHEET="Para (List) Hang Level 1" FSL="Default" -->
          <TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0>
               <TR VALIGN=TOP>
               <TD WIDTH=5%><FONT SIZE=3>(4) </FONT></TD>
               <TD WIDTH=95%><P ALIGN=LEFT><FONT SIZE=3>
               Includes options to purchase 3,333 shares of common stock. </FONT></P></TD>
               </TR>
               </TABLE>
               <BR>

<!-- MARKER FORMAT-SHEET="Para (List) Hang Level 1" FSL="Default" -->
          <TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0>
               <TR VALIGN=TOP>
               <TD WIDTH=5%><FONT SIZE=3>(5) </FONT></TD>
               <TD WIDTH=95%><P ALIGN=LEFT><FONT SIZE=3>
               Includes 50,000 shares owned by subsidiaries of Homburg Invest, Inc., a company
               controlled by Richard Homburg for the benefit of his family. Mr. Homburg may be
               deemed to be the beneficial owner of all shares of common stock owned by Homburg
               Invest, Inc. He disclaims beneficial ownership of these shares. </FONT></P></TD>
               </TR>
               </TABLE>
               <BR>

<!-- MARKER FORMAT-SHEET="Para (List) Hang Level 1" FSL="Default" -->
          <TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0>
               <TR VALIGN=TOP>
               <TD WIDTH=5%><FONT SIZE=3>(6) </FONT></TD>
               <TD WIDTH=95%><P ALIGN=LEFT><FONT SIZE=3>
               Includes options to purchase 3,333 shares of common stock and 69,333 OP Units. </FONT></P></TD>
               </TR>
               </TABLE>
               <BR>


<!-- MARKER FORMAT-SHEET="Para (List) Hang Level 1" FSL="Default" -->
          <TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0>
               <TR VALIGN=TOP>
               <TD WIDTH=5%><FONT SIZE=3>(7) </FONT></TD>
               <TD WIDTH=95%><P ALIGN=LEFT><FONT SIZE=3>
               Includes 13,332 shares of common stock issuable on exercise of options and
               366,003 OP Units. </FONT></P></TD>
               </TR>
               </TABLE>
               <BR>

<!-- MARKER FORMAT-SHEET="Head Major Left Bold" FSL="Default" -->
<H1 ALIGN=LEFT><FONT SIZE=3>Audit Committee Report </FONT></H1>

<!-- MARKER FORMAT-SHEET="Para Large Indent" FSL="Default" -->
<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
Audit Committee is comprised of James J. Burns, Everett&nbsp;B. Miller, III and Roger M.
Widmann, all of whom are independent directors as defined by Sections 303.01(B)(2)(a) and
(3) of the New York Stock Exchange Listing Standards. The Audit Committee operates under a
written charter, which was adopted by the Board. The Audit Committee appoints the
Company&#146;s independent registered public accountants, presently Ernst &amp; Young LLP
(&#147;Ernst &amp; Young&#148;). </FONT></P>

<!-- MARKER FORMAT-SHEET="Para Large Indent" FSL="Default" -->
<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Company
management has primary responsibility for preparing the Company&#146;s financial
statements and the financial reporting process, including establishing and maintaining
adequate internal control over financial reporting and evaluating the effectiveness of
internal control over financial reporting. Ernst &amp; Young is responsible for performing
an independent audit of the Company&#146;s consolidated financial statements in accordance
with generally accepted auditing standards and issuing a report thereon. The Audit
Committee&#146;s responsibility is to monitor and oversee these processes. </FONT></P>

<!-- MARKER FORMAT-SHEET="Para Large Indent" FSL="Default" -->
<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;In
this context, during 2006 the Audit Committee met four times and held separate discussions
with management, the accounting firm which provides internal audit services to the Company
and Ernst &amp; Young. Management represented to the Audit Committee that its consolidated
financial statements were prepared in accordance with generally accepted accounting
principles. Additionally, the Audit Committee has reviewed and discussed the audited
consolidated financial statements with management and Ernst &amp; Young. The Audit
Committee discussed with Ernst &amp; Young matters required to be discussed by the
Statement on Auditing Standards No. 61 (Communication with Audit Committees). </FONT></P>

<!-- MARKER FORMAT-SHEET="Para Large Indent" FSL="Default" -->
<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
Committee received and reviewed a report from the internal auditors detailing the results
of such firm&#146;s internal audit procedures and the Company&#146;s compliance with
Section 404 of the Sarbanes-Oxley Act of 2002. The Committee also received and reviewed a
report prepared by Ernst &amp; Young describing the Company&#146;s internal quality
control procedures and any material issues raised by Ernst &amp; Young&#146;s most recent
internal quality-control review. </FONT></P>

<!-- MARKER FORMAT-SHEET="Para Large Indent" FSL="Default" -->
<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Ernst
&amp; Young provided to the Audit Committee the written disclosures and letter required by
Independence Standards Board Standard No. 1 (Independence Discussions with Audit
Committees), and the Audit Committee discussed with Ernst &amp; Young their independence. </FONT></P>

<!-- MARKER FORMAT-SHEET="Para Large Indent" FSL="Default" -->
<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;In
discharging its duties, during the year the Committee met with management of the Company
and Ernst &amp; Young and discussed the status of the Company&#146;s internal control
procedures and reviewed and discussed the Company&#146;s interim unaudited consolidated
financial statements for 2006 and audited financial statements for the fiscal year ended
December 31, 2006. The Committee also discussed with Ernst &amp; Young the critical
accounting policies and practices used in the preparation of the Company&#146;s audited
financial statements. Management and Ernst &amp; Young have represented to the Committee
that the audited financial statements for the year ended December 31, 2006 were prepared
in accordance with generally accepted accounting principles. </FONT></P>

<!-- MARKER FORMAT-SHEET="Para Large Indent" FSL="Default" -->
<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Based
on the review and discussions with management, the internal auditors and Ernst &amp; Young
LLP, and subject to the limitations on the role and responsibilities of the Committee
referred to above and in the Audit Committee Charter, the Committee has recommended to the
Board of Directors the inclusion of the audited financial statements of the Company in the
Company&#146;s Annual Report on Form 10-K for the year ended December 31, 2006. </FONT></P>

<!-- MARKER FORMAT-SHEET="Head Major Center Bold 1" FSL="Default" -->
<H1 ALIGN=CENTER><FONT SIZE=3>Audit Committee </FONT></H1>

<!-- MARKER FORMAT-SHEET="Head Major Center Bold 1" FSL="Default" -->
<H1 ALIGN=CENTER><FONT SIZE=3>James J. Burns<BR>
Everett B. Miller, III<BR>
Roger M. Widmann </FONT></H1>

<!-- MARKER FORMAT-SHEET="Head Major Left Bold" FSL="Default" -->
<H1 ALIGN=LEFT><FONT SIZE=3>Compensation Committee
Report on Executive Compensation </FONT></H1>

<!-- MARKER FORMAT-SHEET="Para Large Indent" FSL="Default" -->
<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
Compensation Committee reviewed and discussed with management of the Company the
Compensation Discussion and Analysis required by the Securities Exchange Act of 1934.
Based on its review and discussions, the Committee recommended to the Board of Directors
that the Compensation Discussion and Analysis be included in this Proxy Statement. </FONT></P>

<!-- MARKER FORMAT-SHEET="Head Major Center Bold 1" FSL="Default" -->
<H1 ALIGN=CENTER><FONT SIZE=3>The Compensation
Committee </FONT></H1>

<!-- MARKER FORMAT-SHEET="Head Major Center Bold 1" FSL="Default" -->
<H1 ALIGN=CENTER><FONT SIZE=3>James J. Burns<BR>
Paul G. Kirk, Jr.<BR>
Everett B. Miller, III<BR>
Roger M. Widmann </FONT></H1>

<!-- MARKER FORMAT-SHEET="Head Major Left Bold" FSL="Default" -->
<H1 ALIGN=LEFT><FONT SIZE=3>Transactions With
Related Persons </FONT></H1>

<!-- MARKER FORMAT-SHEET="Para Large Indent" FSL="Default" -->
<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;With
respect to approval of transactions with related persons, recently we adopted a written
policy to have the Audit Committee approve any transactions between the Company and any
related person. Prior to this, the Nominating/Corporate Governance Committee addressed
related person matters. In determining whether to approve a related person transaction,
the Audit Committee takes into account, among other factors it deems appropriate, whether
the related person transaction is on terms no less favorable than terms generally
available to an unaffiliated third party under the same or similar circumstances and the
extent of the related person&#146;s interest in the transaction. </FONT></P>

<!-- MARKER FORMAT-SHEET="Para Large Indent" FSL="Default" -->
<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
Company&#146;s principal executive offices are located at 44 South Bayles Avenue, Port
Washington, New York. Mr. Ullman owns 24% of this building through general and limited
partner interests. The lease, at rentals consistent with other leases in the building,
expires in March 2012. Rent is currently approximately $250,000 and escalates annually. </FONT></P>

<!-- MARKER FORMAT-SHEET="Para Large Indent" FSL="Workstation" -->
<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;On
January 31, 2006, the Company acquired the Shore Mall in Egg Harbor Township, NJ, a
621,000 sq. ft. shopping center, for an aggregate purchase price of approximately $35.3
million, including closing costs. An adjacent 50 acres of undeveloped land, purchased for
$2.0 million, including closing costs, was also part of the transaction. Mr. Ullman had
approximately an 8% limited partnership interest in the selling entities. As part of the
purchase price, Mr. Ullman received 19,336 OP Units. In connection with the acquisition,
the independent members of the Company&#146;s Board of Directors obtained an appraisal in
support of the purchase price. The Company had previously held an option to acquire the
property, and had, together with its predecessor companies, been providing property
management, leasing, construction, management and legal services to the property since
1986. </FONT></P>

     <P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Mr.
          Ullman&#146;s son, Frank C. Ullman, is employed by the Company as an assistant
          vice president and received total compensation in 2006 of $224,992 (including a
          restricted stock grant of $49,992). </FONT></P>

<!-- MARKER FORMAT-SHEET="Para Large Indent" FSL="Default" -->
<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Effective
April 2, 2007, the Company entered into an agreement to form a joint venture with a
wholly-owned subsidiary of Homburg Invest Inc., a public Canadian real estate corporation
listed on the Toronto Stock Exchange (TSX:HII.A and HII.B) and Euronext Amsterdam Stock
Exchange (AEX:HII)(&#147;Homburg&#148;), with respect to four shopping centers then owned
and managed by the Company and five properties acquired by the Company on April 4, 2007.
Richard Homburg, a director of the Company since 1998, is Chairman and CEO of Homburg. The
Company will hold a 20% interest in the joint venture and Homburg, through a wholly-owned
U.S. subsidiary, will acquire the remaining 80% interest. The joint venture is structured
in limited partnerships such that, at Homburg&#146;s election, it may sell a portion of
its ownership interests to individual investors in Europe. Homburg will be entitled to
certain fees with respect thereto. The joint venture has been approved by the
Company&#146;s Board of Directors including the unanimous vote of all independent
directors, with Mr. Homburg abstaining from the vote. Closings of the joint venture
transactions are expected to be concluded by the end of 2007, subject to Homburg&#146;s
completion of due diligence and to other normal closing conditions. The
joint venture arrangements incorporate sufficient elements of control, including, without
limitation, the right to trigger a &#147;buy-sell&#148; provision after 18 months, so that
the properties will in all likelihood continue to be included on a consolidated basis in
the Company&#146;s financial statements and, accordingly, no gain will be recognized for
financial reporting purposes. </FONT></P>

<!-- MARKER FORMAT-SHEET="Head Major Left Bold" FSL="Default" -->
<H1 ALIGN=LEFT><FONT SIZE=3>Section 16(a) Beneficial
Ownership Reporting Compliance </FONT></H1>

<!-- MARKER FORMAT-SHEET="Para Large Indent" FSL="Default" -->
<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
Company believes that during 2006 its officers, directors and holders of more than 10% of
its common stock complied with all filing requirements under Section 16(a) of the
Securities Exchange Act of 1934. In making this disclosure, the Company has relied solely
on written representations of its directors, officers and holders of more than 10% of the
Company&#146;s common stock and on copies of reports that have been filed with the
Securities and Exchange Commission. </FONT></P>

<H1 ALIGN=CENTER><FONT SIZE=3>2. AMENDMENT TO ARTICLES OF INCORPORATION INCREASING<BR>
AUTHORIZED SHARES </FONT></H1>

<!-- MARKER FORMAT-SHEET="Para Large Indent" FSL="Default" -->
<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Pursuant
to Article FOURTH of its Articles of Incorporation, as amended, the Company is presently
authorized to issue 50 million shares of Common Stock with a par value of $.06 per share
and 5 million shares of Preferred Stock with a par value of $.01 per share. It is proposed
to amend the first paragraph of Article FOURTH of the Articles of Incorporation of the
Company to read as set forth below in order to increase the number of shares of Common
Stock which the Company is authorized to issue from 50 million to 150 million shares of
Common Stock and to increase the number of shares of Preferred Stock which the Company is
authorized to issue from 5 million to 12.5 million shares of Preferred Stock: </FONT></P>

<!-- MARKER FORMAT-SHEET="Para (List) Indent Level 2" FSL="Default" -->
          <TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0>
               <TR VALIGN=TOP>
               <TD WIDTH=5%></TD>
               <TD WIDTH=95%><P ALIGN=LEFT><FONT SIZE=3>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&#147;A.&nbsp;
               Authorized Shares. The total number of shares of all classes of capital stock
               that the Corporation shall have authority to issue is 162.5 million shares,
               consisting of 150 million shares of Common Stock with a par value of $.06 per
               share (the &#147;Common Stock&#148;), amounting in the aggregate to par value of
               $9,000,000, and 12.5 million shares of Preferred Stock with a par value of $.01
               per share (the &#147;Preferred Stock&#148;), amounting in the aggregate to par
               value of $125,000.&#148; </FONT></P></TD>
               </TR>
               </TABLE>
               <BR>

<!-- MARKER FORMAT-SHEET="Para Large Indent" FSL="Default" -->
<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;At
March 31, 2007, there were 44,188,181 shares of Common Stock issued and outstanding and
6,294,313 shares were reserved for issuance pursuant to the Company&#146;s stock incentive
plans, outstanding offerings of Common Stock, conversion of limited partnership units and
exercise of warrants. At the same date, 3,550,000 shares of Preferred Stock were issued
and outstanding. </FONT></P>

<!-- MARKER FORMAT-SHEET="Para Large Indent" FSL="Default" -->
<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
Board of Directors believes that it is in the best interests of the Company and its
stockholders to increase the number of authorized shares of Common Stock and Preferred
Stock. The increase in authorized shares will provide flexibility with respect to future
transactions, including acquisitions of other businesses where the Company would have the
option to use its common stock or preferred stock (or securities convertible into or
exercisable for common stock, including limited partnership units) as consideration
(rather than cash), financing future growth, financing transactions and other corporate
purposes. The additional shares will enable the Company to avoid the time consuming and
costly need to hold a special meeting of stockholders in every case. The Board of
Directors believes that, in the future, occasions may arise where the time required to
obtain stockholder approval might adversely delay the Company&#146;s ability to enter into
a desirable transaction or deny it the flexibility to facilitate the effective use of its
securities. Authorized but unissued shares of Common Stock and Preferred Stock may be used
by the Company from time to time as appropriate and opportune situations arise. </FONT></P>

<!-- MARKER FORMAT-SHEET="Para Large Indent" FSL="Default" -->
<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Stockholders
of the Company will not have any preemptive rights with respect to the additional shares
being authorized. No further approval by stockholders would be necessary prior to the
issuance of any additional shares of Common Stock or Preferred Stock, except as may be
required by law or applicable New York Stock Exchange rules. In certain circumstances,
generally relating to the number of shares to be issued and the identity of the recipient,
the rules of the New York Stock Exchange require stockholder authorization in connection
with the issuance of such additional shares. Subject to law and the rules of the New York
Stock Exchange, the Board of Directors has the sole discretion to issue additional shares
of Common Stock and Preferred Stock on such terms and for such consideration as may be
determined by the Board of Directors. All of the Preferred Stock of the Company shall have
such voting rights, designations, preferences, qualifications, limitations or restrictions
thereon as shall be set by the Board of Directors pursuant to authority vested in it by
the Articles of Incorporation of the Company. The issuance of any additional shares of
Common Stock or Preferred Stock may have the effect of diluting the percentage of stock
ownership of the present stockholders of the Company. </FONT></P>

<!-- MARKER FORMAT-SHEET="Para Large Indent" FSL="Default" -->
<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
affirmative vote of holders of at least two-thirds of all outstanding shares of Common
Stock of the Company entitled to vote thereon at this meeting is required in order for the
proposed amendment to the Articles of Incorporation to be adopted. The Board of Directors
believes that it would be in the best interests of the Company to amend the first
paragraph of Article FOURTH of the Articles of Incorporation to give effect to this
proposal. </FONT></P>

<!-- MARKER FORMAT-SHEET="Para Large Indent" FSL="Default" -->
<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>The
Board of Directors recommends a vote FOR authorization and approval of the amendment to
the Articles of Incorporation.</B> </FONT></P>

<!-- MARKER FORMAT-SHEET="Stroock Head Major Center Bold" FSL="Default" -->
<P ALIGN=CENTER><FONT SIZE=3><B>3. APPOINTMENT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING
FIRM </B></FONT></P>

<!-- MARKER FORMAT-SHEET="Para Large Indent" FSL="Default" -->
<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
Audit Committee of the Company has selected Ernst &amp; Young LLP as the independent
registered public accounting firm for the Company for the fiscal year ending December 31,
2007. A representative of Ernst &amp; Young LLP is expected to be present at the meeting
with the opportunity to make a statement if such representative so desires and to respond
to appropriate questions. </FONT></P>

<!-- MARKER FORMAT-SHEET="Head Major Left Bold" FSL="Default" -->
<H1 ALIGN=LEFT><FONT SIZE=3>Audit and Non-Audit Fees </FONT></H1>

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<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
following table presents fees for professional audit services rendered by Ernst &amp;
Young LLP for the audit of the Company&#146;s financial statements for the years ended
December 31, 2005 and 2006 and fees billed for other services rendered by such firm during
the periods: </FONT></P>


<TABLE CELLPADDING=0 CELLSPACING=0 BORDER=0 WIDTH=70%>
<TR VALIGN=Bottom>
     <TH COLSPAN=2></TH>
     <TH COLSPAN=2>2006<BR>
Actual Fees<HR WIDTH=75% SIZE=1 COLOR=BLACK NOSHADE></TH>
     <TH COLSPAN=2>2005<BR>
Actual Fees<HR WIDTH=75% SIZE=1 COLOR=BLACK NOSHADE></TH></TR>
<TR VALIGN=Bottom>
     <TD WIDTH=64% ALIGN=LEFT><B>Audit fees</B> (1)</TD>
     <TD WIDTH=4% ALIGN=LEFT>&nbsp;</TD>
     <TD WIDTH=13% ALIGN=RIGHT></TD>
        <TD WIDTH=4% ALIGN=LEFT>&nbsp;</TD>
     <TD WIDTH=13% ALIGN=RIGHT></TD>
        <TD WIDTH=2% ALIGN=LEFT>&nbsp;</TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT>Audit of consolidated financial statements and</TD><TD ALIGN=LEFT>&nbsp;</TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT>internal controls</TD><TD ALIGN=LEFT>&nbsp;</TD>
     <TD ALIGN=RIGHT>$&nbsp;&nbsp;&nbsp;516,000</TD>
        <TD ALIGN=LEFT>&nbsp;</TD>
     <TD ALIGN=RIGHT>$465,000</TD>
        <TD ALIGN=LEFT>&nbsp;</TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT>Quarterly reviews</TD><TD ALIGN=LEFT>&nbsp;</TD>
     <TD ALIGN=RIGHT>90,000</TD>
        <TD ALIGN=LEFT>&nbsp;</TD>
     <TD ALIGN=RIGHT>90,000</TD>
        <TD ALIGN=LEFT>&nbsp;</TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT>SEC filings, including comfort letters and</TD><TD ALIGN=LEFT>&nbsp;</TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT>consents</TD><TD ALIGN=LEFT>&nbsp;</TD>
     <TD ALIGN=RIGHT>167,500</TD>
        <TD ALIGN=LEFT>&nbsp;</TD>
     <TD ALIGN=RIGHT>128,000</TD>
        <TD ALIGN=LEFT>&nbsp;</TD></TR>
<TR>
     <TD COLSPAN=2></TD>
     <TD ALIGN=RIGHT><HR NOSHADE COLOR=#000000 SIZE=1></TD><TD></TD>
     <TD ALIGN=RIGHT><HR NOSHADE COLOR=#000000 SIZE=1></TD><TD></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT>Total Audit Fees</TD><TD ALIGN=LEFT>&nbsp;</TD>
     <TD ALIGN=RIGHT>773,500</TD>
        <TD ALIGN=LEFT>&nbsp;</TD>
     <TD ALIGN=RIGHT>683,000</TD>
        <TD ALIGN=LEFT>&nbsp;</TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><B>Audit-Related Fees</B> (2)</TD><TD ALIGN=LEFT>&nbsp;</TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT>Audits and accounting consultations in connection</TD><TD ALIGN=LEFT>&nbsp;</TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT>with acquisitions</TD><TD ALIGN=LEFT>&nbsp;</TD>
     <TD ALIGN=RIGHT>403,373</TD>
        <TD ALIGN=LEFT>&nbsp;</TD>
     <TD ALIGN=RIGHT>197,000</TD>
        <TD ALIGN=LEFT>&nbsp;</TD></TR>
<TR>
     <TD COLSPAN=2></TD>
     <TD ALIGN=RIGHT><HR NOSHADE COLOR=#000000 SIZE=1></TD><TD></TD>
     <TD ALIGN=RIGHT><HR NOSHADE COLOR=#000000 SIZE=1></TD><TD></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT>Total Audit-Related Fees</TD><TD ALIGN=LEFT>&nbsp;</TD>
     <TD ALIGN=RIGHT>403,373</TD>
        <TD ALIGN=LEFT>&nbsp;</TD>
     <TD ALIGN=RIGHT>197,000</TD>
        <TD ALIGN=LEFT>&nbsp;</TD></TR>
<TR>
     <TD COLSPAN=2></TD>
     <TD ALIGN=RIGHT><HR NOSHADE COLOR=#000000 SIZE=1></TD><TD></TD>
     <TD ALIGN=RIGHT><HR NOSHADE COLOR=#000000 SIZE=1></TD><TD></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT>All Other Fees</TD><TD ALIGN=LEFT>&nbsp;</TD>
     <TD ALIGN=RIGHT>0</TD>
        <TD ALIGN=LEFT>&nbsp;</TD>
     <TD ALIGN=RIGHT>0</TD>
        <TD ALIGN=LEFT>&nbsp;</TD></TR>
<TR>
     <TD COLSPAN=2></TD>
     <TD ALIGN=RIGHT><HR NOSHADE COLOR=#000000 SIZE=1></TD><TD></TD>
     <TD ALIGN=RIGHT><HR NOSHADE COLOR=#000000 SIZE=1></TD><TD></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT>Total Fees</TD><TD ALIGN=LEFT>&nbsp;</TD>
     <TD ALIGN=RIGHT>$1,176,873</TD>
        <TD ALIGN=LEFT>&nbsp;</TD>
     <TD ALIGN=RIGHT>$880,000</TD>
        <TD ALIGN=LEFT>&nbsp;</TD></TR>
<TR>
     <TD COLSPAN=2></TD>
     <TD ALIGN=RIGHT><HR NOSHADE COLOR=#000000 SIZE=2></TD><TD></TD>
     <TD ALIGN=RIGHT><HR NOSHADE COLOR=#000000 SIZE=2></TD><TD></TD></TR>
</TABLE>


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<P>_________________ </P>

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               <TR VALIGN=TOP>
               <TD WIDTH=5%><FONT SIZE=3>(1) </FONT></TD>
               <TD WIDTH=95%><P ALIGN=LEFT><FONT SIZE=3>
               Includes fees and expenses related to the annual audit and interim reviews,
               notwithstanding when the fees and expenses were billed or when the services
               rendered. </FONT></P></TD>
               </TR>
               </TABLE>
               <BR>

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               <TR VALIGN=TOP>
               <TD WIDTH=5%><FONT SIZE=3>(2) </FONT></TD>
               <TD WIDTH=95%><P ALIGN=LEFT><FONT SIZE=3>
               Includes fees and expenses for services rendered from January through December,
               notwithstanding when the fees and expenses were billed. Such fees include audits
               of acquisitions required by the rules of the Securities and Exchange Commission. </FONT></P></TD>
               </TR>
               </TABLE>
               <BR>

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<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;All
audit-related services and other services were pre-approved by the Audit Committee, which
concluded that the provision of such services by the Company&#146;s auditors was
compatible with the maintenance of that firm&#146;s independence in the conduct of its
auditing functions. The policy of the Audit Committee provides for pre-approval of the
yearly audits, quarterly reviews and tax compliance on an annual basis. As individual
engagements arise, they are approved on a case-by-case basis. The Audit Committee may
delegate to one or more of its members pre-approval authority with respect to permitted
services. </FONT></P>

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<P ALIGN=LEFT><FONT SIZE=3><B>Audit Committee Consideration of these Fees</B></FONT></P>

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<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
Company&#146;s Audit Committee has considered whether the provisions of the services
covered under the categories of &#147;Audit-Related Fees&#148; and &#147;All Other
Fees&#148; are compatible with maintaining the independence of Ernst &amp; Young LLP. </FONT></P>

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<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>The
Board of Directors of the Company recommends a vote FOR the ratification of the
appointment of Ernst &amp; Young LLP as the independent registered public accounting firm
of the Company.</B> </FONT></P>

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<H1 ALIGN=CENTER><FONT SIZE=3>4. OTHER MATTERS </FONT></H1>

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<P ALIGN=LEFT><FONT SIZE=3><B>Stockholder Proposals</B></FONT></P>

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<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Proposals
of stockholders intended to be presented at the Company&#146;s 2008 Annual Meeting of
Stockholders must be received by the Company on or prior to December 29, 2007 to be
eligible for inclusion in the Company&#146;s Proxy Statement and form of Proxy to be used
in connection with such meeting. Any notice of stockholder proposals received after this
date is considered untimely. </FONT></P>

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<P ALIGN=CENTER><FONT SIZE=3><B>OTHER BUSINESS </B></FONT></P>

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<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;At
the date of this Proxy Statement, the only business which the Board of Directors intends
to present or knows that others will present at the Meeting is that hereinabove set forth.
If any other matter or matters are properly brought before the meeting, or any adjournment
thereof, it is the intention of the persons named in the accompanying form of Proxy to
vote the Proxy on such matters in accordance with their judgment. </FONT></P>

<P ALIGN=LEFT><FONT SIZE=3>Leo S. Ullman<BR>
<I>Chairman of the Board</I><BR>
Dated: April 27, 2007</FONT></P>

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<P ALIGN=CENTER><FONT SIZE=3><B>CEDAR SHOPPING CENTERS, INC. </B></FONT></P>

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<P ALIGN=CENTER><FONT SIZE=3><B>2007 ANNUAL MEETING OF STOCKHOLDERS &#150; JUNE 12, 2007<BR>
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS </B></FONT></P>

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<P><FONT SIZE=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
undersigned stockholder of Cedar Shopping Centers, Inc., a Maryland corporation, hereby
appoints Leo S. Ullman and Brenda J. Walker and each of them the proxies of the
undersigned with full power of substitution to vote at the Annual Meeting of Stockholders
of the Company to be held at 4:00 PM on June 12, 2007, and at any adjournment or
adjournments thereof (the &#147;Meeting&#148;), with all the power which the undersigned
would have if personally present, hereby revoking any proxy heretofore given. The
undersigned hereby acknowledges receipt of the proxy statement for the Meeting and
instructs the proxies to vote as directed on the reverse side. </FONT></P>

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<H1 ALIGN=CENTER><FONT SIZE=3>(Continued and to be
signed on the reverse side) </FONT></H1>

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<P ALIGN=CENTER><FONT SIZE=3><B>ANNUAL MEETING OF STOCKHOLDERS OF </B></FONT></P>

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<P ALIGN=CENTER><FONT SIZE=3><B>CEDAR SHOPPING CENTERS, INC. </B></FONT></P>

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<P ALIGN=CENTER><FONT SIZE=3><B>JUNE 12, 2007 </B></FONT></P>

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<P ALIGN=CENTER><FONT SIZE=3><B>PLEASE DATE, SIGN AND MAIL<BR>
YOUR PROXY CARD IN THE<BR>
ENVELOPE PROVIDED AS SOON AS POSSIBLE. </B></FONT></P>

<P ALIGN=CENTER><FONT SIZE=3>- Please detach along perforated line and mail in the envelope provided. -</FONT></P>
- ----------------------------------------------------------------------------------------------------------------------------------------------------------------------<BR>
- ----------------------------------------------------------------------------------------------------------------------------------------------------------------------<BR>

<P ALIGN=CENTER><FONT SIZE=3>THE BOARD OF DIRECTORS RECOMMENDS A VOTE "FOR" THE ELECTION OF<BR>
DIRECTORS AND "FOR" PROPOSALS 2 AND 3.<BR>
PLEASE SIGN, DATE AND RETURN PROMPTLY IN THE ENCLOSED ENVELOPE.<BR>
PLEASE MARK YOUR VOTE IN BLUE OR BLACK INK AS SHOWN HERE [X]</FONT></P>

<P ALIGN=LEFT><FONT SIZE=3>1.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; To elect 7 nominees
for Directors:</FONT></P>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT><BR>
</TD>
<TD WIDTH=35%><BR>
 </TD>
<TD WIDTH=60% ALIGN=LEFT>NOMINEES:</TD>
</TR>
</TABLE>
<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT>[&nbsp;&nbsp;]<BR>
<BR>
<BR>
[&nbsp;&nbsp;]<BR>
<BR>
<BR>
<BR>
[&nbsp;&nbsp;] </TD>
<TD WIDTH=35%>FOR ALL NOMINEES <BR>
<BR>
<BR>
WITHHOLD<BR>
AUTHORITY<BR>
FOR ALL NOMINEES<BR>
<BR>
FOR ALL EXCEPT<BR>
(see instructions below)
 </TD>
<TD WIDTH=5% ALIGN=LEFT>
(&nbsp; )<BR>
(&nbsp; )<BR>
(&nbsp; )<BR>
(&nbsp; )<BR>
(&nbsp; )<BR>
(&nbsp; )<BR>
(&nbsp; )</TD>
<TD WIDTH=55%>
James J. Burns<BR>
Richard Homburg<BR>
Paul G. Kirk, Jr.<BR>
Everett B. Miller, III<BR>
Leo S. Ullman<BR>
Brenda J. Walker<BR>
Roger Widmann </TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=15% ALIGN=LEFT>INSTRUCTION:</TD>
<TD WIDTH=85%>
To withhold authority to vote for any individual nominee(s), mark "FOR ALL
EXCEPT" and fill in the circle next to each nominee you wish to withhold, as
show here. (X) </TD>
</TR>
</TABLE>
<HR SIZE=1 NOSHADE>
<BR>
<BR>
<HR SIZE=1 NOSHADE>
<P><FONT SIZE=3>To change the address on your account, please check the box at
right and indicate your new address in the address space above. Please note that
changes to the registered name(s) on the account may not be submitted via this
method. [ ] </FONT></P>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT>2.</TD>
<TD WIDTH=50% ALIGN=LEFT>
To amend the Articles of Incorporation to increase authorized common stock and preferred stock</TD>
<TD WIDTH=45%>
FOR&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; AGAINST&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; ABSTAIN<BR>
[&nbsp;&nbsp;&nbsp;]&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;
[&nbsp;&nbsp;&nbsp;]&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; [&nbsp;&nbsp;&nbsp;]
</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT>3.</TD>
<TD WIDTH=50% ALIGN=LEFT>
To ratify the appointment of Ernst &amp; Young LLP as independent registered public
accounting firm for the fiscal year ending December 31, 2007</TD>
<TD WIDTH=45%>
[&nbsp;&nbsp;&nbsp;]&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;
[&nbsp;&nbsp;&nbsp;]&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; [&nbsp;&nbsp;&nbsp;]
</TD>
</TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5% ALIGN=LEFT>4.</TD>
<TD WIDTH=50% ALIGN=LEFT>With discretionary authority upon such other matters as may properly come before
the Meeting</TD>
<TD WIDTH=45%>
</TD>
</TR>
</TABLE>
<BR>

<P><FONT SIZE=3>THIS PROXY, WHEN PROPERLY SIGNED, WILL BE VOTED IN THE MANNER DIRECTED, IF
NO SPECIFICATION IS MADE, THIS PROXY WILL BE VOTED FOR THE ELECTION OF THE NOMINEES SET
FORTH HEREIN, FOR PROPOSAL 2, FOR THE RATIFICATION OF THE APPOINTMENT OF ERNST &amp; YOUNG
LLP FOR THE FISCAL YEAR ENDING DECEMBER 31, 2007, AND IN THE DISCRETION OF THE PROXY
HOLDERS AS TO ANY OTHER MATTERS WHICH MAY PROPERLY COME BEFORE THE MEETING.  </FONT></P>

<P><FONT SIZE=3>PLEASE MARK, SIGN, DATE AND RETURN THIS PROXY CARD PROMPTLY
USING THE ENCLOSED ENVELOPE. </FONT></P>

<P ALIGN=CENTER><FONT SIZE=3>MARK HERE IF YOU PLAN TO ATTEND THE MEETING [&nbsp;&nbsp; ]</FONT></P>
<HR SIZE=1 NOSHADE>
<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=50% ALIGN=LEFT>Signature of Stockholder <U>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</U><BR>
<BR>
Signature of Stockholder <U>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</U>
</TD>
<TD WIDTH=50%>
Date:<U>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</U><BR>
<BR>
Date:<U>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</U></TD>
</TR>
</TABLE>

<P><FONT SIZE=3>Note: Please sign exactly as your name or names appear on this Proxy. When
shares are held jointly, each holder should sign. When signing as executor, administrator,
attorney, trustee or guardian, please give full title as such. If the signer is a
corporation, please sign full corporate name by duly authorized officer, giving full title
as such. If signer is a partnership, please sign in partnership name by authorized person. </FONT></P>


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