EQUITY RESIDENTIAL (EQR)

Amended and Restated Deferred Compensation Agreement with Mr. Spector

     The Company entered into an Amended and Restated Deferred Compensation Agreement with Mr. Spector in January 2002 which provides him with a salary benefit after the termination of his employment with the Company. If Mr. Spector’s employment is terminated by the Company without cause at any time or Mr. Spector resigns for any reason on or after January 1, 2009, he would be entitled to annual deferred compensation for a ten-year period commencing on the employment termination date in an amount equal to $550,000 (increased by a CPI Index from January 2002 through the employment termination date), multiplied by a percentage equal to 6.67% for each year Mr. Spector was employed by the Company since December 31, 1993, but not to exceed 100%. In the event Mr. Spector’s employment is terminated as a result of his death, permanent disability or incapacity, he would be entitled to the full annual amount of $550,000 (as increased by a CPI Index from January 2002 through the date of death, permanent disability or incapacity). Should Mr. Spector be terminated for cause or should he choose to leave voluntarily, without good reason, prior to January 1, 2009, he would not be entitled to any deferred compensation.

     Assuming the termination of Mr. Spector’s employment as of December 31, 2006, the Company would owe him the following amounts:

• Termination for cause/resignation without Good Reason: $0.
• Termination due to death/disability: 10 annual installments of $630,108. The present value of these payments at 5.63% is $4,852,913.
• Termination by the Company without cause: 10 annual installments of $546,367. The present value of these payments at 5.63% is $4,207,961.

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