Exhibit 10.7

 

INDEMNIFICATION AGREEMENT

 

THIS INDEMNIFICATION AGREEMENT (the “Agreement”) is made as of the      day of
November, 2010 by and between The Howard Hughes Corporation, a Delaware
corporation (the “Company”), and                                (the
“Indemnitee”).

 

WHEREAS, directors, officers, and other persons in service to corporations or
business enterprises are being increasingly subjected to expensive and
time-consuming litigation relating to, among other things, matters that
traditionally would have been brought only against the Company or business
enterprise itself;

 

WHEREAS, highly competent persons have become more reluctant to serve
corporations as directors, officers or in other capacities unless they are
provided with adequate protection through insurance or adequate indemnification
against risks of claims and actions against them arising out of their service to
and activities on behalf of the corporation;

 

WHEREAS, the Board of Directors of the Company (the “Board of Directors”) has
determined that the increased difficulty in attracting and retaining such
persons is detrimental to the best interests of the Company’s stockholders and
that the Company should act to assure such persons that there will be increased
certainty of such protection in the future;

 

WHEREAS, it is reasonable, prudent and necessary for the Company contractually
to obligate itself to indemnify, and to advance expenses on behalf of, such
persons to the fullest extent permitted by applicable law so that they will
serve or continue to serve the Company free from undue concern that they will
not be so indemnified;

 

WHEREAS, although the Amended and Restated Certificate of Incorporation of the
Company (the “Certificate”) and the Amended and Restated Bylaws of the Company
(the “Bylaws”) require indemnification of the officers and directors of the
Company under the circumstances specified therein, and Indemnitee may also be
entitled to indemnification pursuant to the General Corporation Law of the State
of Delaware (“DGCL”), the Certificate, the Bylaws and the DGCL expressly provide
that the indemnification provisions set forth therein are not exclusive, and
authorize the Company to enter into contracts between the Company and members of
the board of directors, officers and other persons with respect to
indemnification; and

 

WHEREAS, this Agreement is a supplement to and in furtherance of the Certificate
and the Bylaws and any resolutions adopted pursuant thereto, and shall not be
deemed a substitute therefor, nor to diminish or abrogate any rights of
Indemnitee thereunder.

 

NOW, THEREFORE, in consideration of Indemnitee’s agreement to serve or continue
serving as a director or officer, or both, of the Company after the date hereof,
the parties hereto agree as follows:

 

1.             Definitions.  For purposes of this Agreement:

 

(a)           “Change in Control” shall mean a change in control of the Company
occurring after the date hereof of a nature that would be required to be
reported in response to

 

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Item 6(e) on Schedule 14A of Regulation 14A (or in response to any similar item
on any similar schedule or form) promulgated under the Securities Exchange Act
of 1934, as amended (the “Act”), whether or not the Company is then subject to
such reporting requirement; provided, however, that, without limitation, a
Change in Control shall include: (i) the acquisition (other than acquisition by
or from the Company) after the date hereof by any person, entity or “group,”
within the meaning of Section 13(d)(3) or 14(d)(2) of the Act (excluding, for
this purpose, the Company or its subsidiaries, any employee benefit plan of the
Company or its subsidiaries that acquires beneficial ownership of voting
securities of the Company, and any qualified institutional investor that meets
the requirements of Rule 13d-1(b)(1) promulgated under the Act) of beneficial
ownership (within the meaning of Rule 13d-3 promulgated under the Act), of 50%
or more of either the then-outstanding shares of common stock or the combined
voting power of the Company’s then-outstanding capital stock entitled to vote
generally in the election of directors; (ii) individuals who, as of the date
hereof, constitute the Board of Directors (the “Incumbent Board”) ceasing for
any reason to constitute at least a majority of the Board of Directors, provided
that any person becoming a director subsequent to the date hereof whose
election, or nomination for election by the Company’s stockholders was approved
by a vote of at least a majority of the directors then comprising the Incumbent
Board (other than an election or nomination of an individual whose initial
assumption of office is in connection with an actual or threatened election
contest relating to the election of the directors of the Company) shall be, for
purposes of this Agreement, considered as though such person were a member of
the Incumbent Board; or (iii) approval by the stockholders of the Company of
(A) a reorganization, merger or consolidation, in each case, with respect to
which persons who were the stockholders of the Company immediately prior to such
reorganization, merger or consolidation do not, immediately thereafter, own more
than 50% of the combined voting power entitled to vote generally in the election
of directors of the reorganized, merged, consolidated or other surviving
corporation’s then-outstanding voting securities, (B) a liquidation or
dissolution of the Company, or (C) the sale of all or substantially all of the
assets of the Company.

 

(b)           “Corporate Status” describes the status of a person who is or was
a director, officer, employee, agent or fiduciary of the Company or of any other
corporation, partnership, limited liability company, joint venture, trust,
employee benefit plan or other enterprise that such person is or was serving in
a similar capacity at the written request of the Company.

 

(c)           “Disinterested Director” means a director of the Company who is
not and was not a party to the Proceeding in respect of which indemnification or
advancement is sought by Indemnitee.

 

(d)           “Enterprise” shall mean the Company and any other corporation,
partnership, limited liability company, joint venture, trust, employee benefit
plan or other enterprise that Indemnitee is or was serving at the written
request of the Company as a director, officer, employee, agent or fiduciary.

 

(e)           “Expenses” shall include all reasonable attorneys’ fees,
retainers, disbursements of counsel, court costs, filing fees, transcript costs,
fees and expenses of experts, witness fees and expenses, travel expenses,
duplicating and imaging costs, printing and binding costs, telephone charges,
facsimile transmission charges, computer legal research costs, postage,

 

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delivery service fees and all other disbursements or expenses of the types
customarily incurred in connection with prosecuting, defending, preparing to
prosecute or defend, investigating, participating, or being or preparing to be a
witness in a Proceeding, as well as all other “expenses” within the meaning of
that term as used in Section 145 of the General Corporation Law of the State of
Delaware and all other disbursements or expenses of types customarily and
reasonably incurred in connection with prosecuting, defending, preparing to
prosecute or defend, investigating, being or preparing to be a witness in, or
otherwise participating in, actions, suits, or proceedings similar to or of the
same type as the Proceeding with respect to which such disbursements or expenses
were incurred; but, notwithstanding anything in the foregoing to the contrary,
“Expenses” shall not include amounts of judgments, penalties, or fines actually
levied against the Indemnitee in connection with any Proceeding.  Expenses also
shall include the foregoing incurred in connection with any appeal resulting
from any Proceeding, including without limitation the premium, security for, and
other costs relating to any cost bond, supersedeas bond, or other appeal bond or
its equivalent.

 

(f)            “Independent Counsel” means a law firm, a member of a law firm or
an independent practitioner that is experienced in matters of corporation law
and indemnification issues and neither presently is, nor in the past five years
has been, retained to represent:  (i) the Company or Indemnitee in any matter
material to either such party (other than with respect to matters concerning
Indemnitee under this Agreement, or of other indemnitees under similar
indemnification agreements), or (ii) any other party to the Proceeding giving
rise to a claim for indemnification hereunder.  Notwithstanding the foregoing,
the term “Independent Counsel” shall not include any person who, under the
applicable standards of professional conduct then prevailing, would have a
conflict of interest in representing either the Company or Indemnitee in an
action to determine Indemnitee’s rights under this Agreement.

 

(g)           “Proceeding” includes any threatened, pending or completed action,
suit, arbitration, alternate dispute resolution mechanism, investigation
(including any internal investigation), inquiry, administrative hearing or any
other actual, threatened or completed proceeding (including, with respect to any
of the foregoing, in relation to a waiver or renouncement pursuant to Delaware
law of any interest or expectancy of the Company in, or being offered to
participate in, any business opportunity or opportunities), whether brought by
or in the right of the Company or otherwise and whether civil, criminal,
administrative or investigative, in which Indemnitee was, is or will be involved
as a party or otherwise, by reason of the fact that Indemnitee is or was an
officer or director of the Company, by reason of any action taken by Indemnitee
or of any inaction on such Indemnitee’s part while acting as an officer or
director of the Company, or by reason of the fact that such Indemnitee is or was
serving at the request of the Company as a director, officer, employee, agent or
fiduciary of another corporation, partnership, joint venture, trust or other
Enterprise; in each case whether or not he is acting or serving in any such
capacity at the time any liability or expense is incurred for which
indemnification can be provided under this Agreement; including one pending on
or before the date of this Agreement, but excluding one initiated by an
Indemnitee pursuant to Section 8 of this Agreement to enforce such Indemnitee’s
rights under this Agreement.

 

(h)           References herein to “fines” shall not include any excise tax
assessed with respect to any employee benefit plan.

 

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(i)            References herein to a director of another Enterprise or a
director of an other Enterprise shall include, in the case of any entity that is
not managed by a board of directors, such other position, such as manager or
trustee or member of the governing body of such entity, that entails
responsibility for the management and direction of such entity’s affairs,
including, without limitation, the general partner of any partnership (general
or limited) and the manager or managing member of any limited liability company.

 

(j)            (i) References herein to serving at the request of the Company as
a director, officer, employee, agent, or fiduciary of another Enterprise shall
include any service as a director, officer, employee, or agent of the Company
that imposes duties on, or involves services by, such director or officer with
respect to an employee benefit plan of the Company or any of its affiliates,
other than solely as a participant or beneficiary of such a plan; and (ii) if
the Indemnitee has acted in good faith and in a manner the Indemnitee reasonably
believed to be in the interest of the participants and beneficiaries of an
employee benefit plan, the Indemnitee shall be deemed to have acted in a manner
not opposed to the best interests of the Company for purposes of this Agreement.

 

2.             Indemnity of Indemnitee.  The Company hereby agrees to hold
harmless and indemnify Indemnitee to the fullest extent permitted by applicable
law, as such may be amended from time to time.  In furtherance of the foregoing
indemnification, and without limiting the generality thereof:

 

(a)           Proceedings Other Than Proceedings by or in the Right of the
Company.  Except as provided in Section 10 hereof, Indemnitee shall be entitled
to the rights of indemnification provided in this Section 2(a) if, by reason of
Indemnitee’s Corporate Status, the Indemnitee is or was, or is or was threatened
to be made, a party to or is otherwise involved in any Proceeding other than a
Proceeding by or in the right of the Company to procure a judgment in its
favor.  Pursuant to this Section 2(a), Indemnitee shall be indemnified against
all Expenses, judgments, penalties, fines, liabilities and amounts paid in
settlement actually and reasonably incurred by Indemnitee, or on Indemnitee’s
behalf, in connection with such Proceeding or any claim, issue or matter
therein, but only if the Indemnitee acted in good faith and in a manner the
Indemnitee reasonably believed to be in or not opposed to the best interests of
the Company, and with respect to any criminal Proceeding, had no reasonable
cause to believe the Indemnitee’s conduct was unlawful.

 

(b)           Proceedings by or in the Right of the Company.  Except as provided
in Section 10 hereof,  Indemnitee shall be entitled to the rights of
indemnification provided in this Section 2(b) if, by reason of Indemnitee’s
Corporate Status, the Indemnitee is or was, or is or was threatened to be made,
a party to or is or was otherwise involved in any Proceeding brought by or in
the right of the Company to procure a judgment in its favor.  Pursuant to this
Section 2(b), Indemnitee shall be indemnified against all Expenses actually and
reasonably incurred by the Indemnitee, or on the Indemnitee’s behalf, in
connection with such Proceeding or any claim, issue or matter therein, but only
if the Indemnitee acted in good faith and in a manner the Indemnitee reasonably
believed to be in or not opposed to the best interests of the Company; provided,
however, if applicable law so provides, no indemnification for such Expenses
shall be made in respect of any claim, issue or matter in such Proceeding as to
which the Indemnitee shall have been adjudged liable to the Company unless (and
only to the extent that) the Court of

 

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Chancery of the State of Delaware or the court in which such Proceeding was
brought shall determine upon application that, despite the adjudication of
liability but in view of all the circumstances of the case, the Indemnitee is
fairly and reasonably entitled to indemnity for such Expenses that the Court of
Chancery or such other court shall deem proper.

 

(c)           Overriding Right to Indemnification if Successful on the Merits. 
Notwithstanding any other provision of this Agreement, to the extent that
Indemnitee is or was, by reason of Indemnitee’s Corporate Status or otherwise, a
party to and is or was successful, on the merits or otherwise, in any
Proceeding, he shall be indemnified to the maximum extent permitted by
applicable law, as such may be amended from time to time, against all Expenses
actually and reasonably incurred by Indemnitee or on Indemnitee’s behalf in
connection therewith.  If Indemnitee is not wholly successful in such Proceeding
but is successful, on the merits or otherwise, as to one or more but less than
all claims, issues or matters in such Proceeding, the Company shall indemnify
Indemnitee to the maximum extent permitted by applicable law, as such may be
amended from time to time, against all Expenses actually and reasonably incurred
by Indemnitee or on Indemnitee’s behalf in connection with each successfully
resolved claim, issue or matter.  For purposes of this Section and without
limitation, the termination of any claim, issue or matter in such a Proceeding
by dismissal, with or without prejudice, shall be deemed to be a successful
result as to such claim, issue or matter.

 

3.             Additional Indemnity.  In addition to, and without regard to any
limitations on, the indemnification provided for in Section 2 of this Agreement,
the Company shall and hereby does, to the fullest extent permissible under
applicable law, indemnify and hold harmless Indemnitee against all Expenses,
judgments, penalties, fines, liabilities and amounts paid in settlement actually
and reasonably incurred by Indemnitee or on Indemnitee’s behalf if, by reason of
Indemnitee’s Corporate Status, he is, or is threatened to be made, a party to or
participant in any Proceeding (including a Proceeding by or in the right of the
Company), including, without limitation, all liability arising out of the
negligence or active or passive wrongdoing of Indemnitee.  The only limitation
that shall exist upon the Company’s obligations pursuant to this Agreement shall
be that the Company shall not be obligated to make any payment to Indemnitee
that is finally determined (under the procedures, and subject to the
presumptions, set forth in Section 7 and Section 8 hereof) to be unlawful.

 

4.             Contribution.

 

(a)           To the fullest extent permissible under applicable law, whether or
not the indemnification provided in Section 2 and Section 3 hereof is available,
in respect of any threatened, pending or completed action, suit or proceeding in
which the Company is jointly liable with Indemnitee (or would be if joined in
such action, suit or proceeding), the Company shall pay, in the first instance,
the entire amount of any judgment or settlement of such action, suit or
proceeding without requiring Indemnitee to contribute to such payment, and the
Company hereby waives and relinquishes any right of contribution it may have
against Indemnitee.  The Company shall not enter into any settlement of any
action, suit or proceeding in which the Company is jointly liable with
Indemnitee (or would be if joined in such action, suit or proceeding) unless
such settlement provides for a full and final release of all claims asserted
against Indemnitee.

 

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(b)           To the fullest extent permissible under applicable law, without
diminishing or impairing the obligations of the Company set forth in the
preceding subparagraph, if, for any reason, Indemnitee shall elect or be
required to pay all or any portion of any judgment or settlement in any
threatened, pending or completed action, suit or proceeding in which the Company
is jointly liable with Indemnitee (or would be if joined in such action, suit or
proceeding), the Company shall contribute to the amount of Expenses, judgments,
fines, liabilities and amounts paid in settlement actually and reasonably
incurred and paid or payable by Indemnitee in proportion to the relative
benefits received by the Company and all officers, directors or employees of the
Company, other than Indemnitee, who are jointly liable with Indemnitee (or would
be if joined in such action, suit or proceeding), on the one hand, and
Indemnitee, on the other hand, from the transaction from which such action, suit
or proceeding arose; provided, however, that the proportion determined on the
basis of relative benefit may, to the extent necessary to conform to law, be
further adjusted by reference to the relative fault of the Company and all
officers, directors or employees of the Company, other than Indemnitee, who are
jointly liable with Indemnitee (or would be if joined in such action, suit or
proceeding), on the one hand, and Indemnitee, on the other hand, in connection
with the events that resulted in such Expenses, judgments, fines, liabilities or
settlement amounts, as well as any other equitable considerations which the law
may require to be considered.  The relative fault of the Company and all
officers, directors or employees of the Company, other than Indemnitee, who are
jointly liable with Indemnitee (or would be if joined in such action, suit or
proceeding), on the one hand, and Indemnitee, on the other hand, shall be
determined by reference to, among other things, the degree to which their
actions were motivated by intent to gain personal profit or advantage, the
degree to which their liability is primary or secondary and the degree to which
their conduct is active or passive.

 

(c)           The Company hereby agrees to fully indemnify and hold Indemnitee
harmless from any claim of contribution brought by officers, directors or
employees of the Company, other than Indemnitee, who may be jointly liable with
Indemnitee.

 

(d)           To the fullest extent permissible under applicable law, if the
indemnification provided for in this Agreement is unavailable to Indemnitee for
any reason whatsoever, the Company, in lieu of indemnifying Indemnitee, shall
contribute to the amount incurred by Indemnitee, whether for judgments, fines,
liabilities, penalties, excise taxes, amounts paid or to be paid in settlement
and/or for Expenses, in connection with any claim relating to an indemnifiable
event under this Agreement, in such proportion as the Board of Directors deems
fair and reasonable in light of all of the circumstances of such Proceeding in
order to reflect (i) the relative benefits received by the Company (together
with its directors, officers, employees and agents) and Indemnitee as a result
of the event(s) and/or transaction(s) giving cause to such Proceeding; and/or
(ii) the relative fault of the Company (and its directors, officers, employees
and agents) and Indemnitee in connection with such event(s) and/or
transaction(s).

 

5.             Indemnification for Expenses of a Witness.  Notwithstanding any
other provision of this Agreement, to the extent that Indemnitee is or was, by
reason of Indemnitee’s Corporate Status or otherwise, a witness, or is or was
made (or asked) to respond to discovery requests, in any Proceeding to which
Indemnitee is not a party, he shall be indemnified to the fullest extent
permissible under applicable law against all Expenses actually and reasonably
incurred by Indemnitee or on Indemnitee’s behalf in connection therewith.

 

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6.             Advancement of Expenses.  Notwithstanding any other provision of
this Agreement, but subject to Section 9(e) hereof, the Company shall advance
all Expenses incurred by or on behalf of Indemnitee in connection with any
Proceeding by reason of Indemnitee’s Corporate Status or otherwise within thirty
(30) calendar days after the receipt by the Company of a statement or statements
from Indemnitee requesting such advance or advances from time to time, whether
prior to or after final disposition of such Proceeding.  Such statement or
statements shall reasonably evidence the Expenses incurred by or on behalf of
Indemnitee and for which advancement is requested, and shall include or be
preceded or accompanied by an undertaking by or on behalf of Indemnitee to repay
any Expenses advanced if it shall finally be determined (under the procedures,
and subject to the presumptions, set forth in Section 7 and Section 8 hereof)
that Indemnitee is not entitled to be indemnified against such Expenses.  Such
undertaking shall be sufficient for purposes of this Section 6 if it is
substantially in the form attached hereto as Exhibit A.  Any advances and
undertakings to repay pursuant to this Section 6 shall be unsecured and
interest-free.  The Indemnitee shall be entitled to advancement of Expenses as
provided in this Section 6 regardless of any determination by or on behalf of
the Company that the Indemnitee has not met the standards of conduct set forth
in Sections 2(a) and 2(b) hereof.

 

7.             Procedures and Presumptions for Determination of Entitlement to
Indemnification.  It is the intent of this Agreement to secure for Indemnitee
rights of indemnity that are as favorable as may be permitted under the DGCL and
public policy of the State of Delaware.  Accordingly, the parties agree that the
following procedures and presumptions shall apply in the event of any question
as to whether Indemnitee is entitled to indemnification under this Agreement:

 

(a)           Indemnitee shall give the Company notice in writing as soon as
practicable of any claim made against Indemnitee for which indemnification will
or could be sought under this Agreement.  To obtain indemnification under this
Agreement, the Indemnitee shall submit to the Company a written request for
indemnification, including therein or therewith, except to the extent previously
provided to the Company in connection with a request or requests for advancement
pursuant to Section 6 hereof, a statement or statements reasonably evidencing
all Expenses incurred or paid by or on behalf of the Indemnitee and for which
indemnification is requested, together with such documentation and information
as is reasonably available to Indemnitee and as is reasonably necessary for the
Company to determine whether and to what extent Indemnitee is entitled to
indemnification.  The Secretary of the Company shall, promptly upon receipt of
such a request for indemnification, advise the Board of Directors in writing
that Indemnitee has requested indemnification.  Failure to provide any notice
required hereby shall not impair Indemnitee’s rights of indemnification and
contribution under this Agreement except to the extent that such failure to
provide notice actually and materially prejudices the rights of the Company to
defend any action or proceeding which is the basis of the claimed
indemnification.

 

(b)           Upon written request by Indemnitee for indemnification pursuant to
the second sentence of Section 7(a) hereof, a determination with respect to
Indemnitee’s entitlement thereto shall be made by the following person or
persons, who shall be empowered to make such determination: (i) if a Change in
Control shall have occurred, by Independent Counsel (unless Indemnitee shall
request in writing that such determination be made by the Board of Directors

 

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(or a committee thereof) in the manner provided for in clause (ii) of this
Section 7(b)) in a written opinion to the Board of Directors, a copy of which
shall be delivered to Indemnitee; or (ii) if a Change of Control shall not have
occurred, (A)(1) by Independent Counsel, if Indemnitee shall request in writing
that such determination be made by Independent Counsel upon making Indemnitee’s
request for indemnification pursuant to the second sentence of Section 7(a),
(2) by the Board of Directors of the Company, by a majority vote of
Disinterested Directors even though less than a quorum, or (3) by a committee of
Disinterested Directors designated by majority vote of Disinterested Directors,
even though less than a quorum, or (B) if there are no such Disinterested
Directors or, even if there are such Disinterested Directors, if the Board of
Directors, by the majority vote of Disinterested Directors, so directs, by
Independent Counsel in a written opinion to the Board of Directors, a copy of
which shall be delivered to Indemnitee.

 

(c)           If the determination of entitlement to indemnification is to be
made by Independent Counsel pursuant to Section 7(b) hereof, the Independent
Counsel shall be selected by the Board of Directors and approved by Indemnitee. 
Upon failure of the Board of Directors to so select, or upon the failure of
Indemnitee to so approve, such Independent Counsel within 20 days after
submission by Indemnitee of a written request for indemnification pursuant to
Section 7(a) hereof, the Independent Counsel shall be selected by the Court of
Chancery of the State of Delaware or such other person or body as the Indemnitee
and the Company may agree in writing.  Such determination of entitlement to
indemnification shall be made not later than forty-five (45) days after receipt
by the Company of a written request for indemnification.  If the person making
such determination shall determine that Indemnitee is entitled to
indemnification as to part (but not all) of the application for indemnification,
such person shall reasonably pro-rate such part of indemnification among such
claims, issues or matters.  If it is so determined that Indemnitee is entitled
to indemnification, payment to Indemnitee shall be made within ten (10) days
after such determination.  The Company shall pay any and all reasonable fees and
expenses of Independent Counsel incurred by such Independent Counsel in
connection with acting pursuant to Section 7(b) hereof, and the Company shall
pay all reasonable fees and expenses incident to the procedures of this
Section 7(c), regardless of the manner in which such Independent Counsel was
selected or appointed.

 

(d)           In connection with any determination (including a determination by
the Court of Chancery of the State of Delaware (or other court of competent
jurisdiction)) with respect to entitlement to indemnification hereunder, the
burden of proof shall be on the Company to establish that Indemnitee is not
entitled to indemnification and any decision that Indemnitee is not entitled to
indemnification must be supported by clear and convincing evidence.  The failure
of the Company (including by its directors or Independent Counsel) to have made
a determination prior to the commencement of any action pursuant to this
Agreement that indemnification is proper in the circumstances because Indemnitee
has met the applicable standard of conduct, or an actual determination by the
Company (including by its directors or Independent Counsel) that Indemnitee has
not met such applicable standard of conduct, shall not be a defense to the
action or create a presumption that Indemnitee has not met the applicable
standard of conduct.

 

(e)           In making a determination with respect to whether Indemnitee acted
in good faith and in a manner that Indemnitee reasonably believed to be in or
not opposed to the best interests of the Company, the person or persons or
entity making such determination shall

 

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presume that Indemnitee acted in good faith and in a manner that Indemnitee
reasonably believed to be in or not opposed to the best interests of the
Company.  Anyone seeking to overcome this presumption shall have the burden of
proof and any decision that Indemnitee is not entitled to indemnification must
be supported by clear and convincing evidence.  In addition, and in no way
limiting the provisions of this Section 7, Indemnitee shall be deemed to have
acted in good faith and in a manner Indemnitee reasonably believed to be in or
not opposed to the best interests of the Enterprise, or with respect to any
criminal action or proceeding to have had no reasonable cause to believe
Indemnitee’s conduct was unlawful, if Indemnitee’s action is based on (i) the
records or books of account of the Enterprise, (ii) information supplied to
Indemnitee by the officers of the Enterprise in the course of their duties,
(iii) the advice of legal counsel for the Enterprise or (iv) information or
records given or reports made to the Enterprise by an independent certified
public accountant or by an appraiser or other expert selected with reasonable
care by the Enterprise; provided, however, that any failure by Indemnitee to act
on the advice of legal counsel for the Enterprise shall not, in and of itself,
constitute grounds for an adverse determination with respect to whether
Indemnitee acted in good faith and in a manner that Indemnitee reasonably
believed to be in or not opposed to the best interests of the Company.  In
addition, the knowledge and/or actions, or failure to act, of any director,
officer, agent or employee of the Enterprise shall not be imputed to Indemnitee
for purposes of determining the right to indemnification under this Agreement.

 

(f)            If the person, persons or entity empowered or selected under this
Section 7 to determine whether Indemnitee is entitled to indemnification shall
not have made a determination within sixty (60) days after receipt by the
Company of the request therefor, the requisite determination of entitlement to
indemnification shall be deemed to have been made and Indemnitee shall be
entitled to such indemnification absent (i) a misstatement by Indemnitee of a
material fact, or an omission of a material fact necessary to make Indemnitee’s
statement not materially misleading, in connection with the request for
indemnification, or (ii) a prohibition of such indemnification under applicable
law; provided, however, that such sixty (60) day period may be extended for a
reasonable time, not to exceed an additional thirty (30) days, if the person,
persons or entity making such determination with respect to entitlement to
indemnification in good faith requires such additional time to obtain or
evaluate documentation and/or information relating thereto and so notifies the
Indemnitee.

 

(g)           Indemnitee shall cooperate with the person, persons or entity
making such determination with respect to Indemnitee’s entitlement to
indemnification, including providing to such person, persons or entity upon
reasonable advance request any documentation or information which is not
privileged or otherwise protected from disclosure and which is reasonably
available to Indemnitee and reasonably necessary to such determination.  Any
Independent Counsel or member of the Board of Directors shall act reasonably and
in good faith in making a determination regarding the Indemnitee’s entitlement
to indemnification under this Agreement.  Any costs or expenses (including
attorneys’ fees and disbursements) incurred by Indemnitee in so cooperating with
the person, persons or entity making such determination shall be borne by the
Company (irrespective of the determination as to Indemnitee’s entitlement to
indemnification) and the Company hereby agrees to indemnify and hold Indemnitee
harmless therefrom.

 

9

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(h)           The Company acknowledges that a settlement or other disposition
short of final judgment may be successful if it permits a party to avoid
expense, delay, distraction, disruption and uncertainty.  In the event that any
Proceeding to which Indemnitee is or becomes a party is resolved in any manner
other than by adverse judgment against Indemnitee (including, without
limitation, settlement of such action, claim or proceeding with or without
payment of money or other consideration) it shall be presumed that Indemnitee
has been successful on the merits or otherwise in such Proceeding.  Anyone
seeking to overcome this presumption shall have the burden of proof and the
burden of persuasion by clear and convincing evidence.

 

(i)            The termination of any Proceeding or of any claim, issue or
matter therein, by judgment, order, settlement or conviction, or upon a plea of
nolo contendere or its equivalent, shall not (except as otherwise expressly
provided in this Agreement) of itself adversely affect the right of Indemnitee
to indemnification under this Agreement or create a presumption that Indemnitee
did not act in good faith and in a manner which he reasonably believed to be in
or not opposed to the best interests of the Company or, with respect to any
criminal Proceeding, that Indemnitee had reasonable cause to believe that
Indemnitee’s conduct was unlawful.

 

8.             Remedies of Indemnitee.

 

(a)           In the event that (i) a determination is made pursuant to
Section 7 of this Agreement that Indemnitee is not entitled to indemnification
under this Agreement, (ii) advancement of Expenses is not timely made pursuant
to Section 6 of this Agreement, (iii) no determination of entitlement to
indemnification is made pursuant to Section 7(b) of this Agreement within ninety
(90) days after receipt by the Company of the request for indemnification,
(iv) payment of indemnification is not made pursuant to this Agreement within
fifty-five (55) days after receipt by the Company of a written request therefor
or (v) payment of indemnification is not made within ten (10) days after a
determination has been made that Indemnitee is entitled to indemnification or
such determination is deemed to have been made pursuant to Section 7 of this
Agreement, Indemnitee shall be entitled to an adjudication in an appropriate
court of the State of Delaware, or in any other court of competent jurisdiction,
of Indemnitee’s entitlement to such indemnification and/or advancement of
Expenses.  The Company shall not oppose Indemnitee’s right to seek any such
adjudication.

 

(b)           In the event that a determination shall have been made pursuant to
Section 7(b) of this Agreement that Indemnitee is not entitled to
indemnification, any judicial proceeding commenced pursuant to this Section 8
shall be conducted in all respects as a de novo trial on the merits, and
Indemnitee shall not be prejudiced by reason of the adverse determination under
Section 7(b).

 

(c)           If a determination shall have been made pursuant to
Section 7(b) of this Agreement that Indemnitee is entitled to indemnification,
the Company shall be bound by such determination in any judicial proceeding
commenced pursuant to this Section 8, absent (i) a misstatement by Indemnitee of
a material fact, or an omission of a material fact necessary to make
Indemnitee’s misstatement not materially misleading in connection with the
application for indemnification, or (ii) a prohibition of such indemnification
under applicable law.

 

10

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(d)           In the event that (a) the Indemnitee commences a proceeding
seeking (1) to establish or enforce the Indemnitee’s entitlement to
indemnification or advancement pursuant to this Agreement, (2) to otherwise
enforce Indemnitee’s rights under or to interpret the terms of this Agreement,
(3) to recover damages for breach of this Agreement, (4) to establish or enforce
Indemnitee’s entitlement to indemnification or advancement pursuant to the
Certificate or the Bylaws, or (5) to enforce or interpret the terms of any
liability insurance policy maintained by the Company (each such proceeding an
“Indemnitee Enforcement Proceeding”), or (b) the Company commences a proceeding
against the Indemnitee seeking (1) to recover, pursuant to an undertaking or
otherwise, amounts previously advanced to Indemnitee, (2) to enforce the
Company’s rights under or to interpret the terms of this Agreement, or (3) to
recover damages for breach of this Agreement (each such proceeding a “Company
Enforcement Proceeding” and together with each form of Indemnitee Enforcement
Proceeding, an “Enforcement Proceeding”), then the Indemnitee shall be entitled
to recover from the Company, and shall be indemnified by the Company against,
any and all Expenses actually and reasonably incurred by or on behalf of such
Indemnitee in connection with such Enforcement Proceeding, provided, however, if
applicable law so provides, no indemnification against such Expenses shall be
made in respect of any claim, issue or matter in such Proceeding on which
Indemnitee does not prevail, unless (and only to the extent that) the Court of
Chancery of the State of Delaware or the court in which such Proceeding was
brought shall determine upon application that, despite the adjudication in
respect of such claim, issue or matter but in view of all the circumstances of
the case, the Indemnitee is fairly and reasonably entitled to indemnity for such
Expenses that the Court of Chancery or such other court shall deem proper.  The
Company also shall be required to advance all Expenses actually and reasonably
incurred by or on behalf of the Indemnitee in connection with any Enforcement
Proceeding in advance of the final disposition of such Enforcement Proceeding
within thirty (30) days after the receipt by the Company of a written request
for such advance or advances from time to time, which request shall include or
be accompanied by a statement or statements reasonably evidencing the Expenses
incurred by or on behalf of the Indemnitee and for which advancement is
requested; provided, however, that any such advancement shall be made only after
the Company receives an undertaking by or on behalf of the Indemnitee to repay
any Expenses so advanced if it shall be finally determined that Indemnitee is
not entitled to be indemnified against such Expenses.

 

(e)           The Company shall be precluded from asserting in any judicial
proceeding commenced pursuant to this Section 8 that the procedures and
presumptions of this Agreement are not valid, binding and enforceable and shall
stipulate in any such court that the Company is bound by all the provisions of
this Agreement.

 

(f)            Notwithstanding anything in this Agreement to the contrary, no
determination as to entitlement to indemnification under this Agreement shall be
required to be made prior to the final disposition of the Proceeding.

 

9.             Non-Exclusivity; Survival of Rights; Insurance; Subrogation.

 

(a)           The rights of indemnification as provided by this Agreement shall
not be deemed exclusive of any other rights to which Indemnitee may at any time
be entitled under applicable law, the Certificate, the Bylaws, any agreement, a
vote of stockholders, a resolution of directors or otherwise.  No amendment,
alteration or repeal of this Agreement or of any

 

11

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provision hereof shall limit or restrict any right of Indemnitee under this
Agreement in respect of any action taken or omitted by such Indemnitee in
Indemnitee’s Corporate Status or otherwise prior to such amendment, alteration
or repeal.  To the extent that a change in the DGCL or applicable law, whether
by statute or judicial decision, permits greater indemnification or advancement
than would be afforded currently under the Certificate, the Bylaws and this
Agreement, it is the intent of the parties hereto that Indemnitee shall enjoy by
this Agreement the greater benefits so afforded by such change.  No right or
remedy herein conferred is intended to be exclusive of any other right or
remedy, and every other right and remedy shall be cumulative and in addition to
every other right and remedy given hereunder or now or hereafter existing at law
or in equity or otherwise.  The assertion or employment of any right or remedy
hereunder, or otherwise, shall not prevent the concurrent assertion or
employment of any other right or remedy.  Notwithstanding anything in this
Agreement to the contrary, the indemnification and contribution provided for in
this Agreement will remain in full force and effect regardless of any
investigation made by or on behalf of Indemnitee or any of Indemnitee’s agents.

 

(b)           To the extent that the Company maintains an insurance policy or
policies providing liability insurance for directors, officers, employees, or
agents or fiduciaries of the Company or of any other corporation, partnership,
limited liability company, joint venture, trust, employee benefit plan or other
Enterprise that such person serves at the request of the Company, Indemnitee
shall be covered by such policy or policies in accordance with its or their
terms to the maximum extent of the coverage available for any director, officer,
employee, agent or fiduciary under such policy or policies.  If, at the time of
the receipt of a notice of a claim pursuant to the terms hereof, the Company has
director and officer liability or other applicable insurance in effect, the
Company shall give prompt notice of the commencement of such Proceeding to the
insurers in accordance with the procedures set forth in the respective
policies.  The Company shall thereafter take all necessary or desirable action
to cause such insurers to pay, on behalf of the Indemnitee, all amounts payable
as a result of such Proceeding in accordance with the terms of such policies.

 

(c)           Subject to Section 9(f), except as otherwise agreed between the
Company, on the one hand, and Indemnitee or another indemnitor of Indemnitee, on
the other, in the event of any payment to or on behalf of the Indemnitee under
this Agreement, the Company shall be subrogated to the extent of such payment to
all of the rights of recovery of Indemnitee, who shall execute all papers
reasonably required and take all action reasonably necessary to secure such
rights, including execution of such documents as are necessary to enable the
Company to bring suit to enforce such rights.

 

(d)           Subject to Section 9(f), except as otherwise agreed between the
Company, on the one hand, and Indemnitee or another indemnitor of Indemnitee, on
the other, the Company shall not be liable under this Agreement to make any
payment of amounts otherwise indemnifiable hereunder if and to the extent that
Indemnitee has otherwise actually received such payment under any Company
insurance policy, Company contract, Company agreement or otherwise (except to
the extent that Indemnitee is required (by court order or otherwise) to return
such payment or to surrender it to the Company).

 

(e)           Subject to Section 9(f), except as otherwise agreed between the
Company, on the one hand, and Indemnitee or another indemnitor of Indemnitee, on
the other, the

 

12

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Company’s obligation to indemnify or advance Expenses hereunder to Indemnitee
who is or was serving at the request of the Company as a director, officer,
employee or agent of any other corporation, partnership, limited liability
company, joint venture, trust, employee benefit plan or other Enterprise shall
be reduced by any amount Indemnitee has actually received as indemnification or
advancement of expenses from such other corporation, partnership, limited
liability company, joint venture, trust, employee benefit plan or other
enterprise (except to the extent that Indemnitee is required (by court order or
otherwise) to return such payment or to surrender it to the Company).

 

(f)            The Company hereby acknowledges that Indemnitee is serving as a
director or officer of the Company at the request of the Company or its Board of
Directors.  The Company hereby further acknowledges that Indemnitee might have
certain rights to indemnification, advancement of Expenses and/or insurance
coverage provided by one or more third parties other than the Company and its
insurers (collectively, the “Third Party Indemnitors”).  The Company hereby
agrees that: (i) as between the Company and any Third Party Indemnitor, the
Company is the indemnitor of first resort (i.e., its obligations to Indemnitee
are primary and any obligation of any Third Party Indemnitor to advance Expenses
or to provide indemnification or insurance coverage for the same Expenses or
liabilities incurred by Indemnitee are secondary); (ii) it shall be required to
advance the full amount of Expenses incurred by or on behalf of Indemnitee and
shall be liable for the full amount of all judgments or amounts paid in
settlement to the extent legally permitted and as required by the terms of this
Agreement, the Certificate or the Bylaws (or any other agreement between the
Company and Indemnitee), without regard to any rights Indemnitee may have
against any Third Party Indemnitor; and (iii) it hereby irrevocably and
unconditionally waives, relinquishes and releases any and all Third Party
Indemnitors from any and all claims against the Third Party Indemnitors (or any
of them) for contribution, subrogation or any other recovery of any kind in
respect thereof.  The Company further agrees that no advancement or payment by
any Third Party Indemnitor on behalf of Indemnitee with respect to any claim for
which Indemnitee has sought indemnification from the Company shall affect the
foregoing in any respect and the Third Party Indemnitors shall have a right of
contribution and/or be subrogated to the extent of such advancement or payment
to all of the rights of recovery of Indemnitee against the Company.  The Company
and Indemnitee agree that the Third Party Indemnitors are express third party
beneficiaries of the terms of this Section 9.

 

10.           Exception to Right of Indemnification.  Notwithstanding any
provision in this Agreement, the Company shall not be obligated under this
Agreement to make any indemnity in connection with any claim made against
Indemnitee:

 

(a)           for which payment has actually been made to or on behalf of
Indemnitee under any insurance policy, or other indemnity provision or
otherwise, except with respect to any excess beyond the amount so paid, and
except as may otherwise be agreed between the Company, on the one hand, and
Indemnitee or another indemnitor of Indemnitee, on the other;

 

(b)           for an accounting of profits made from the purchase and sale (or
sale and purchase) by Indemnitee of securities of the Company within the meaning
of Section 16(b) of the Act, as amended, or similar provisions of state
statutory law or common law; or

 

13

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(c)           in connection with any Proceeding (or any part of any Proceeding)
initiated by Indemnitee, including any Proceeding (or any part of any
Proceeding) initiated by Indemnitee against the Company or any of its direct or
indirect subsidiaries or the directors, officers, employees or other indemnitees
of the Company or its direct or indirect subsidiaries (other than any Proceeding
initiated by Indemnitee pursuant to Section 8(d),  which shall be governed by
the terms of such section), unless (i) the Board of Directors of the Company
authorized the Proceeding (or any part of any Proceeding) prior to its
initiation or (ii) the Company provides the indemnification, in its sole
discretion, pursuant to the powers vested in the Company under applicable law.

 

11.           Successors.  This Agreement shall be binding upon and inure to the
benefit of and be enforceable by the parties hereto and their respective
successors (including any direct or indirect successor by purchase, merger,
consolidation or otherwise to all or substantially all of the business or assets
of the Company), assigns, spouses, heirs, executors and personal and legal
representatives.

 

12.           Security.  To the extent requested by Indemnitee and approved by
the Board of Directors of the Company, the Company may at any time and from time
to time provide security to Indemnitee for the Company’s obligations hereunder
through an irrevocable bank line of credit, funded trust or other collateral. 
Any such security, once provided to Indemnitee, may not be revoked or released
without the prior written consent of the Indemnitee.

 

13.           Enforcement.

 

(a)           The Company expressly confirms and agrees that it has entered into
this Agreement and assumes the obligations imposed on it hereby in order to
induce Indemnitee to serve or continue serving as an officer or director of the
Company, and the Company acknowledges that Indemnitee is relying upon this
Agreement in serving as an officer or director of the Company.

 

(b)           This Agreement constitutes the entire agreement between the
parties hereto with respect to the subject matter hereof and supersedes all
prior agreements and understandings, oral, written and implied, between the
parties hereto with respect to the subject matter hereof.

 

(c)           The Company represents that this Agreement has been approved by
the Company’s Board of Directors.

 

14.           Severability.  The invalidity or unenforceability of any provision
hereof shall in no way affect the validity or enforceability of any other
provision hereof.  Without limiting the generality of the foregoing, this
Agreement is intended to confer upon Indemnitee indemnification rights to the
fullest extent permitted by applicable laws.  In the event any provision hereof
conflicts with any applicable law, such provision shall be deemed modified,
consistent with the aforementioned intent, to the extent necessary to resolve
such conflict.

 

15.           Modification and Waiver.  No supplement, modification, termination
or amendment of this Agreement shall be binding unless executed in writing by
both of the parties hereto.  No waiver of any of the provisions of this
Agreement shall be deemed or shall constitute

 

14

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a waiver of any other provisions hereof (whether or not similar) nor shall such
waiver constitute a continuing waiver.

 

16.           Notice By Indemnitee.  Indemnitee agrees to promptly notify the
Company in writing upon being served with or otherwise receiving any summons,
citation, subpoena, complaint, indictment, information or other document
relating to any Proceeding or matter which may be subject to indemnification
covered hereunder.  The failure to so notify the Company shall not relieve the
Company of any obligation which it may have to Indemnitee under this Agreement
or otherwise unless and only to the extent that such failure or delay materially
prejudices the Company.

 

17.           Disclosure of Payments.  Except as expressly required by any law,
neither party shall publicly disclose any payments under this Agreement unless
prior approval of the other party is obtained.

 

18.           Notices.  Unless otherwise provided herein, any notice required or
permitted under this Agreement shall be deemed effective upon the earlier of
(a) actual receipt, or (b) (i) one (1) business day after the date of delivery
by confirmed facsimile transmission, (ii) one (1) business day after the
business day of deposit with a nationally recognized overnight courier service
for next day delivery, freight prepaid, or (iii) three (3) business days after
deposit with the United States Post Office for delivery by registered or
certified mail, postage prepaid.  Any such notice shall be in writing and shall
be addressed to the party to be notified at the address indicated for such party
indicated on the signature pages or exhibits hereto, as otherwise set forth in
this Section 18, or at such other address as such party may designate by ten
(10) days’ advance written notice to the other parties.  All communications
shall be sent:

 

(a)           To Indemnitee at the address set forth below Indemnitee’s
signature hereto;

 

(b)           To the Company at its principal executive office;

 

or to such other address as may have been furnished to Indemnitee by the Company
or to the Company by Indemnitee, as the case may be.

 

19.           Counterparts.  This Agreement may be executed in two or more
counterparts, each of which shall be deemed an original, but all of which
together shall constitute one and the same Agreement.  This Agreement may also
be executed and delivered by facsimile or electronic signature.

 

20.           Headings.  The headings of the sections and subsections of this
Agreement are inserted for convenience only and shall not be deemed to
constitute part of this Agreement or to affect the construction thereof.

 

21.           Governing Law and Consent to Jurisdiction.  This Agreement and the
legal relations among the parties shall be governed by, and construed and
enforced in accordance with, the laws of the State of Delaware, without regard
to its conflict of laws rules.  The Company and Indemnitee hereby irrevocably
and unconditionally (i) agree that any action or proceeding arising out of or in
connection with this Agreement shall be brought only in the Chancery Court of
the

 

15

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State of Delaware (the “Delaware Court”), and not in any other state or federal
court in the United States of America or any court in any other country,
(ii) consent to submit to the exclusive jurisdiction of the Delaware Court for
purposes of any action or proceeding arising out of or in connection with this
Agreement, (iii) consent to service of any summons and complaint and any other
process that may be served in any action, suit, or proceeding arising out of or
relating to this Agreement by mailing by certified or registered mail, with
postage prepaid, copies of such process to such party at its address for
receiving notice pursuant to Section 18 hereof, (iv) waive any objection to the
laying of venue of any such action or proceeding in the Delaware Court, and
(v) waive, and agree not to plead or to make, any claim that any such action or
proceeding brought in the Delaware Court has been brought in an improper or
inconvenient forum.  Nothing herein shall preclude service of process by any
other means permitted by applicable law.

 

22.           Assignment.  Neither party hereto may assign this Agreement
without the prior written consent of the other party; provided, however, that
the Company may assign this Agreement upon a Change in Control.

 

23.           Construction.  The parties acknowledge that both parties have
contributed to the drafting of this Agreement and, therefore, waive the
application of any law, regulation, holding or rule of construction providing
that ambiguities in an agreement or other document will be construed against the
party drafting such agreement or document.

 

[signature page follows]

 

16

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IN WITNESS WHEREOF, the parties have executed this Agreement as of the date
first above written.

 

INDEMNITEE:

 

 

 

Signature:

 

 

 

 

 

Name:

 

 

 

 

 

Address:

 

 

 

 

 

 

 

COMPANY:

 

 

 

 

 

The Howard Hughes Corporation

 

 

 

 

 

 

By:

 

 

 

 

 

Name:

 

 

 

 

 

Title:

Authorized Officer

 

 

 

 

Address:

 

 

 

[Signature Page to Holdings Indemnification Agreement]

 

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Exhibit A

 

UNDERTAKING

 

Reference is hereby made to that certain Indemnification Agreement, by and
between The Howard Hughes Corporation, a Delaware corporation (the “Company”),
and the undersigned, dated as of November     , 2010 (the “Indemnification
Agreement”).  All initially capitalized terms used herein and not otherwise
defined herein shall have the meanings set forth in the Indemnification
Agreement.

 

Pursuant to the Indemnification Agreement, I,
                                                                        , agree
to reimburse the Company for all Expenses paid to me or on my behalf by the
Company in connection with my involvement in [name or description of proceeding
or proceedings], in the event, and to the extent, that it shall ultimately be
determined (pursuant to the terms of the Indemnification Agreement) that I am
not entitled to be indemnified by the Company for such Expenses.

 

 

 

Signature

 

 

 

 

 

 

 

Typed Name

 

 

 

ss:

 

 

 

Before me                                             , on this day personally
appeared                                       , known to me to be the person
whose name is subscribed to the foregoing instrument, and who, after being duly
sworn, stated that the contents of said instrument is to the best of his/her
knowledge and belief true and correct and who acknowledged that he/she executed
the same for the purpose and consideration therein expressed.

 

GIVEN under my hand and official seal at                 , this               
day of                       , 20    .

 

 

 

 

 

Notary Public

 

My commission expires:

 

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