Exhibit 10.23

DUKE REALTY CORPORATION LETTERHEAD

 

                      , 20

 

Mr. or Ms.

 

 

 

Re: Executive Severance

 

Dear         ,

 

The Board of Directors of Duke Realty Corporation (which, together with its
subsidiaries, predecessors and affiliates, is referred to as the “Company”) is
pleased to offer you, as a senior officer of the Company, the severance benefits
described below in exchange for your agreement to protect the legitimate
business interests of the Company following your separation from employment.

 

Benefits

 

Upon your separation from employment by the Company and your compliance with the
obligations set forth below, you will be entitled to receive certain separation
benefits. These benefits, which differ depending upon the circumstances of your
separation, are:

 

A.           If you voluntarily terminate your employment by the Company, you
will be entitled to separation payments totaling an amount equal to your annual
base pay in effect on the last day of the calendar year immediately preceding
the calendar year in which your employment is terminated (the “Compensation
Year”).  The amount of any cash bonus, performance bonus, or equity-based or
long-term incentive bonus received by you during or with respect to the
Compensation Year will not be included as base pay. For example, if on
December 31 of the Compensation Year you were being paid a base salary at the
annual rate of $150,000, and in February of the year your employment terminated
you received a cash bonus of $50,000 for the Compensation Year, your separation
payments would total $150,000. These payments will be made to you in equal
monthly installments over twelve (12) months beginning not later than sixty (60)
days following your separation. The Company will withhold from any amounts
payable to you all legally required federal, state, city and local taxes.

 

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B.  If the Company terminates your employment For Cause, you will be entitled to
separation payments totaling ten thousand dollars ($10,000.00). “For Cause”
means any of the following, as determined solely in the discretion of the Board
of Directors or a committee designated by the Board of Directors: (i) your
willful and continued failure to perform your required duties as an officer or
employee of the Company, (ii) any action by you which involves willful
misfeasance or gross negligence, (iii) the requirement of, or direction by, a
federal or state regulatory agency which has jurisdiction over the Company to
terminate your employment, (iv) any conduct, action or inaction by you which
causes embarrassment, diminished good will, or otherwise is deemed substantially
harmful or contrary to the interests of the Company, (v) your conviction of any
criminal offense which involves dishonesty or breach of trust, or (vi) any
intentional breach or violation by you of a material term, condition, or
covenant of any agreement between you and the Company or condition of your
employment, including the Company’s Code of Conduct.  Before terminating your
employment For Cause, the Company must provide to you written notice of the
grounds warranting For Cause termination and give you at least ten (10) days
after such notice to cure and remedy your conduct to the satisfaction of the
Company.  These payments will be made to you in equal monthly installments over
two (2) months beginning not later than sixty (60) days following your
separation. The Company will withhold from any amounts payable to you all
legally required federal, state, city and local taxes.

 

C.             If the Company terminates your employment for any reason other
than For Cause, and there has been no Change of Control as defined below, your
termination will be considered a separation for “Other Than Cause.” You agree
that a change in your status or position or duties with the Company that does
not involve either a demotion or a reduction in base salary or annual incentive
bonus targets will not constitute a termination of your employment by the
Company. In the event the Company terminates your employment for Other Than
Cause, you will be entitled to receive separation payments totaling an amount
equal to two (2) times the sum of (i) your annual base pay in effect on the last
day of the calendar year immediately preceding the calendar year in which your
employment is terminated (the “Compensation Year”), plus (ii) any annual cash
incentive bonus paid or payable to you with respect to services performed in the
Compensation Year.  For example, if on December 31 of the Compensation Year you
were being paid a base salary at the annual rate of $100,000, and in February of
the year your employment terminated you received a $50,000 annual cash incentive
bonus for services performed in the Compensation Year and a long term incentive
bonus valued at $25,000 for services performed in the Compensation Year, your
separation payments would total $300,000 (($100,000 + $50,000) x 2). These
payments will be made to you in equal monthly installments over twenty-four (24)
months beginning not later than sixty (60) days following your separation. The
Company will withhold from any amounts payable to you all legally required
federal, state, city and local taxes.

 

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D.            If the Company terminates your employment within one (1) year of a
Change in Control of the Company, or if you terminate your employment by the
Company voluntarily for Good Reason, you will be entitled to receive separation
payments totaling an amount equal to three (3) times the sum of (i) your annual
base pay in effect on the last day of the calendar year immediately preceding
the calendar year in which your employment is terminated (the “Compensation
Year”), plus (ii)  any annual cash incentive bonus paid or payable to you with
respect to services performed in the Compensation Year.  For example, if on
December 31 of the Compensation Year you were being paid a base salary at the
annual rate of $100,000, and in February of the year your employment terminated
you received a $50,000 annual cash incentive bonus for services performed in the
Compensation Year and a long-term incentive bonus valued at $25,000 for services
performed in the Compensation Year, your separation payments would total
$450,000 (($100,000 + $50,000) x 3). These payments will be made to you in equal
monthly installments over twenty-four (24) months beginning not later than sixty
(60) days following your separation. The Company will withhold from any amounts
payable to you all legally required federal, state, city and local taxes.

 

“Change in Control” of the Company means:

 

(a) a “change in control” of the Company of a nature that would be required to
be reported in the Company’s next proxy statement filed under Section 14(a) of
the Securities Exchange Act of 1934, as amended (“1934 Act”);

 

(b) a “person” (as that term is used in Section 14(d)(2) of the 1934 Act),
directly or indirectly, after the date of this letter becomes the beneficial
owner (as defined in Rule 13d-3 under the 1934 Act) of securities representing
25% or more of the combined voting power for election of directors of the
then-outstanding securities of the Company;

 

(c) the individuals who are directors of the Company at the beginning of any
period of two consecutive years or less cease for any reason during that period
to constitute at least a majority of the Board, unless the election or
nomination for election of each new member of the Board was recommended or
approved by vote of at least two-thirds of the members of the Board then serving
who were members of the Board at the beginning of such period;

 

(d)the shareholders of the Company approve any dissolution or liquidation of the
Company or any sale or disposition of 50% or more of the assets or business of
the Company; or

 

(e) the shareholders of the Company approve a merger or consolidation to which
the Company is a party (other than a merger or consolidation with a wholly-owned
subsidiary of the Company) or a share exchange in which the Company

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will exchange Company shares for shares of another corporation as a result of
which the persons who were shareholders of the Company immediately before the
effective date of such merger, consolidation or share exchange will have
beneficial ownership of less than 50% of the combined voting power for election
of directors of the surviving corporation immediately following the effective
date of such merger, consolidation or share exchange.

 

 “Good Reason” means the occurrence of any of the following during the one
(1) year period of time immediately following a Change in Control:

 

(a)          a change in your status or position with the Company that does not
represent a promotion from your status and position in effect immediately prior
to a Change in Control of the Company;

 

(b)         a forced move to a location more than sixty (60) miles from your
place of        business immediately prior to a Change in Control; or

 

(c)          a reduction by the Company in your base salary and /or a reduction
in the your annual incentive bonus targets as compared to that in effect
immediately prior to a Change in Control. You may not terminate your employment
for “Good Reason” without providing the Company with written notice of the
grounds which you believe constitute “Good Reason” and giving the Company at
least ten (10) days after your notice to cure and remedy its conduct.

 

E.                          In the event that you die or become disabled before
you have received all of your separation payments, you, your designee in writing
or, if none, your estate will receive the balance of the separation payments
otherwise due to you.

 

F.                          If you violate or fail to comply with any of your
obligations as set forth herein, no further payments will become due or be paid
to you (or your surviving spouse, designee or estate). Any payments otherwise
due to you that were delayed pursuant to paragraph I. below shall still be paid
to you.

 

G.                         If you become, without obtaining advance written
consent by the Company, an owner of more than 2% of any business which is
substantially similar to or competes with the Company, no further payments will
become due or be paid to you (or your surviving spouse, designee or estate).

 

H.                        If you become, without obtaining advance written
consent by the Company, employed by, or serve as an officer, director,
consultant, independent contractor, agent or representative of, any business
that is substantially similar to or competes with Company, no further payments
will become due or be paid to you (or your surviving spouse, designee or
estate).

 

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I.                             To the extent required to comply with
Section 409A of the Internal Revenue Code of 1986, as amended (the “Code”), as
determined by the Company’s outside counsel, one or more payments described
under A, B, C or D above shall be delayed to the six month anniversary of the
date of your separation from service, within the meaning of Code Section 409A.

 

Obligations

 

In order to receive the separation payments described above, you must live up to
certain obligations. If you fail to do so, your right to receive separation
payments will end immediately. These obligations are:

 

1.               For a period of two (2) years following your separation from
employment, you may not solicit or attempt to solicit any then-existing customer
of the Company or any potential customer of the Company with whom the Company is
then engaged in discussions regarding one or more specific possible transactions
for purposes of providing, marketing, or selling products or services
competitive with the products and/or services sold or offered by the Company. If
you voluntarily terminate your employment by the Company for any reason, or if
the Company terminates your employment For Cause, this two (2) year period will
be reduced to one (1) year.

 

2.               You may not use or disclose to anyone any Trade Secret
belonging to the Company to which you may have had access while employed by
Company. “Trade Secret” means information including, but not limited to,
technical or non-technical data, a formula, a pattern or design, a compilation,
a program, a device, a method, a technique, a drawing, a process, financial
data, financial plans, product plans, or a list of actual or potential
customers, tenants or suppliers which (a) derives economic value, actual or
potential, from not being generally known to, and not being readily
ascertainable by proper means by, other persons who can obtain economic value
from its disclosure or use; and (b) is the subject of efforts that are
reasonable under the circumstances to maintain its secrecy. “Trade Secret” does
not include information that is or becomes generally known to the public; or was
already known by you prior to your employment by the Company; or that you obtain
from an independent source having a bona fide right to use and disclose such
information; or that the Company approves for unrestricted release by express
authorization.

 

3.               For a period of two (2) years following your separation from
employment, you may not use or disclose to anyone any Confidential Information
belonging to the Company to which you may have had access while employed by the
Company. “Confidential Information” means any data or information, other than
Trade Secrets, that is important to the Company, is competitively sensitive, and
is not generally known by the public. “Confidential Information” includes,
without limitation:  (1) the sales records, profit and performance records,
pricing manuals,

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models and related materials, sales manuals, training manuals, selling and
pricing procedures, and financing methods of the Company; (2) customer and
tenant lists, the special demands of particular customers and tenants, and the
current and anticipated requirements of customers and tenants for the
properties, products and services of the Company; (3) the specifications of any
new properties, products or services under development by the Company; and
(4) the business plans, marketing strategies, and internal financial statements
and projections of the Company. “Confidential Information” does not include
information that is or becomes generally known to the public; or was already
known by you prior to employment by the Company; or that you obtain from an
independent source having a bona fide right to use and disclose such
information; or that the Company approves for unrestricted release by express
authorization.

 

4.               Promptly upon your separation from employment by the Company,
you and the Company agree to execute a General Release of All Claims and
Covenant Not to Sue in the form then in general use by the Company.

 

5.               For a period of one (1) year following your separation from
employment by the Company, you may not, directly or indirectly, without
obtaining prior approval from the Company, encourage or solicit any then-current
employee of the Company to separate from employment by the Company.

 

6.               Within two (2) days of your date of separation from employment
by the Company, you must return to the Company all Trade Secrets and
Confidential Information or other tangible things, including all computers,
computer disks or other media, files, reports, financial data, handbooks,
training materials, marketing or strategic reports, policy statements, programs,
and other documents or tangible things provided to you by the Company or
acquired by you as a result of your employment by the Company. You may not
retain any copies or remove or participate in removing any such materials or
things from the premises of Company.

 

7.               You understand and agree that the non-solicitation and
non-disclosure obligations described above are acceptable to you and are
reasonable in light of the nature of the business of Company, your access to
information while an employee of the Company, the opportunities, contacts, and
professional development you have received during your employment by the Company
and the Company’s legitimate need to protect its good will and guard against the
disclosure or misuse of its proprietary information.

 

Once accepted by you, the terms set forth in this letter may not be amended or
terminated by either you or the Company except in a written document executed by
both parties.  This offer, whether or not accepted by you, will not change your
status as an at-will employee of Company. Any action required of or permitted by
the Company under this letter shall be by resolution of the Board of Directors,
by a committee of the Board of Directors, or by a person or persons authorized
by resolution of the Board of Directors or a committee of the Board of
Directors.

 

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The terms of, and any dispute arising under, this letter will be governed by the
laws of Indiana. You agree that any litigation arising out of or under this
letter will be commenced and maintained only in the state or federal courts
within the state of Indiana.

 

If the foregoing is acceptable to you, please so indicate by signing a copy of
this letter where indicated below and returning it to the Company.

 

Very truly yours,

 

DUKE REALTY CORPORATION

 

By:

 

 

 

Dennis D. Oklak

 

 

Chairman and Chief Executive Officer

 

 

 

 

 

 

 

 

 

Agreed and accepted this        day of                     , 20

 

 

 

 

 

 

 

 

 

 

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