exhibit10_86.htm


    HINES
REAL ESTATE INVESTMENT TRUST, INC.

    


    INDEMNIFICATION
AGREEMENT

    


    THIS INDEMNIFICATION AGREEMENT (the
“Agreement”) is entered into as of August 26, 2008, to be effective as of April
1, 2008, by and between Hines Real Estate Investment Trust, Inc. (the
“Company”), a Maryland corporation, and Paul B. Murphy, Jr. (the
“Indemnitee”).

    


    WHEREAS, the Indemnitee became an
officer or a member of the Board of Directors of the Company (on April 1, 2008)
and in such capacity is performing a valuable service for the
Company;

    


    WHEREAS, the law of the Company’s state
of organization permits the Company to enter into contracts with its officers or
members of its Board of Directors with respect to indemnification of such
persons; and

    


    WHEREAS, to induce the Indemnitee to
continue to provide services to the Company as an officer or a member of the
Board of Directors, and to provide the Indemnitee with specific contractual
assurance that indemnification will be available to the Indemnitee regardless
of, among other things, any amendment to or revocation of the Company’s Second
Amended and Restated Articles of Incorporation (“Articles of Incorporation”), or
any acquisition transaction relating to the Company, the Company desires to
provide the Indemnitee with protection against personal liability.

    


    NOW, THEREFORE, in consideration of the
premises and the covenants contained herein, the Company and the Indemnitee
hereby agree as follows:

    


    ARTICLE
I

    


    DEFINITIONS

    


    As used herein, the following words and
terms shall have the following respective meanings:

    


    (A)           “Change
in Control” shall mean a change in the possession, directly or indirectly, of
the power to direct or cause the direction of the management and policies of the
Company, or any successor in interest thereto, whether through the ownership of
voting securities, by contract or otherwise, including but not limited to a
change which would be required to be reported under Item 6(e) of Schedule 14A of
Regulation 14A promulgated under the Securities Exchange Act of 1934 as in
effect on the date hereof (the “Exchange Act”) or as may otherwise be determined
pursuant to a resolution of the Board of Directors.  A rebuttable
presumption of a Change in Control shall be created by any of the following
which first occur after the date hereof and the Company shall have the burden of
proof to overcome such presumption:

    


    i.           the
ability of any “Person” (as such term is defined in Sections 13(d) and 14(d) of
the Exchange Act) together with an “Affiliate” or “Associate” (as defined in
Rule 12b-2 of the Exchange Act) or “Group” (within the  meaning of
Section 13(d)(3) of the Exchange Act) to exercise or direct the exercise of 20%
or more of the combined voting power of all outstanding shares of beneficial
interest of the Company in the election of its directors (“Interested Party”)
(provided, however, “Interested Party” shall not include an agent, broker,
nominee, custodian or director, solely in their capacity as such, for one or
more persons who do not individually or as a group possess such
power),

    


    ii.           during
any period of two consecutive years, individuals who at the beginning of such
period constitute the Board of Directors of the Company cease for any reason to
constitute at least a majority thereof, unless the election of each director who
was not a director at the beginning of such period has been approved in advance
by the directors representing two-thirds of the directors then in office who
were the directors at the beginning of the period,

    


    
      	
               
      

            	
              iii.

            	
              the
      approval of the stockholders of the Company
of:

            


    

    


    (a)           a
merger or consolidation of the Company with any Interested Party,

    


    (b)           any
sale, lease, exchange, mortgage, pledge, transfer, or other disposition, to or
with any Interested Party in any transaction or series of transactions, of the
Company’s assets or the assets of any subsidiary of the Company having a market
value equal to 30% or more of the aggregate market value of all assets of the
Company determined on a consolidated basis, all outstanding shares of beneficial
interest of the Company, or the earning power or net income of the Company,
determined on a consolidated basis,

    


    (c) the
issuance or transfer by the Company, or any subsidiary thereof, to any
Interested Party in any transaction or a series of transactions, of capital
securities with a value equal to 5% or more of the aggregate market value of the
then outstanding voting shares of beneficial interest of the Company other than
the issuance or transfer of such shares of beneficial interest to all the
Company stockholders on a pro rata basis,

    


    (d) the
adoption of any plan or proposal for the partial or complete liquidation or
dissolution of the Company proposed by an Interested Party or pursuant to any
agreement, arrangement or understanding, whether or not in writing, with any
Interested Party,

    


    (e)           any
reclassification of securities, including, without limitation, any share split,
share dividend, or other distributions of shares, or any reverse share split,
recapitalization of the Company, or any merger or consolidation of the Company
with any subsidiary thereof, or any other transaction proposed by, or pursuant
to, any agreement, arrangement, or understanding, whether or not in writing,
with any Interested Party which has the effect, directly or indirectly, of
increasing the proportionate voting shares of beneficial interest of the Company
directly or indirectly owned by any such Interested Party, or

    


    iv.           any
receipt by any Interested Party, directly or indirectly, of any loans, advances,
guarantees, pledges or other financial assistance, or any tax credits or other
tax advantages provided by or through the Company other than the receipt of such
advantages which are provided to all the Company stockholders on a pro rata
basis.

    


    (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, joint venture, trust, employee benefit plan or other enterprise
(whether conducted for profit or not for profit) which such person is or was
serving at the request of the Company.

    


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

    


    (D)           “Effective
Date” means the date of this Agreement as set forth above.

    


    (E)           “Expenses”
shall include all attorney and paralegal fees, retainers, court costs,
transcript costs, fees of experts, witness fees, travel expenses, duplicating
costs, printing and binding costs, telephone charges, postage, 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, or being or preparing to be a witness in a
Proceeding.

    


    (F)           “Independent
Counsel” means a law firm, or a member of a law firm, that is experienced in
matters of corporation law and neither presently is, nor in the past two years
has been, retained to represent (i) the Company or the Indemnitee in any matter
material to either such party, or (ii) any other party to the Proceeding giving
rise to a claim for indemnification hereunder.

    


    (G)           “Proceeding”
includes any action, suit, arbitration, alternate dispute resolution mechanism,
investigation, administrative hearing, or any other proceeding, including
appeals therefrom, whether civil, criminal, administrative, or investigative,
except one initiated by the Indemnitee pursuant to Article VIII of this
Agreement to enforce such Indemnitee’s rights under this Agreement.

    


    ARTICLE
II

    


    INDEMNIFICATION

    


    (A) The
Indemnitee shall be entitled to the rights of indemnification provided in this
Article II and under applicable law, the Articles of Incorporation, the
Company’s Bylaws, any agreement, a vote of stockholders or resolution of the
Board of Directors or otherwise if, by reason of such Indemnitee’s Corporate
Status, such Indemnitee is, or is threatened to be made, a party to any
threatened, pending, or completed Proceeding, including a Proceeding by or in
the right of the Company.  Unless prohibited by Article XIII hereof,
the Indemnitee shall be indemnified against Expenses, judgments, penalties,
fines, and settlement amounts actually and reasonably incurred by or on behalf
of such Indemnitee in connection with such Proceeding or any claim, issue or
matter therein.

    


    (B)           Notwithstanding
paragraph 2(A) above, the Company shall not indemnify any Indemnitee that is a
member of the Board of Directors or an Affiliate (as such term is defined in the
Articles of Incorporation) of the Company unless all of the following conditions
are met:

    


    i.           the
Indemnitee determined, in good faith, that the course of conduct which caused
the loss or liability was in the best interests of the Company; and

    


    ii.           the
Company shall not indemnify or hold harmless the Indemnitee if: (1) in the case
that the Indemnitee is a member of the Board of Directors, other than an
Independent Director (as such term is defined in the Articles of Incorporation),
the loss or liability was the result of negligence or misconduct by the
Indemnitee, or (2) in the case that the Indemnitee is an Independent Director,
the loss or liability was the result of gross negligence or willful misconduct
by the Indemnitee.

    


    (C)           Notwithstanding
paragraphs 2(A) and 2(B) above, the Company shall not provide indemnification
for any loss, liability or expense arising from or out of an alleged violation
of federal or state securities laws by an Indemnitee that is a member of the
Board of Directors or an Affiliate of the Company unless at least one of the
following conditions are met:

    


    i.           there
has been a successful adjudication on the merits of each count involving alleged
securities law violations as to the Indemnitee;

    


    ii.           such
claims have been dismissed with prejudice on the merits by a court of competent
jurisdiction as to the Indemnitee; or

    


    iii.           a
court of competent jurisdiction approves a settlement of the claims against the
Indemnitee and finds that indemnification of the settlement and the related
costs should be made, and the court considering the request for indemnification
has been advised of the position of the Securities and Exchange Commission and
of the published position of any state securities regulatory authority in which
securities of the Company were offered or sold as to indemnification for
violations of securities laws.

    


    (D)           Any
indemnification of Expenses under this Agreement may be paid only out of the Net
Assets (as such term is defined in the Articles of Incorporation) of the Company
and no portion may be recoverable from the stockholders of the
Company.

    


    ARTICLE
III

    


    EXPENSES
OF A SUCCESSFUL PARTY

    


    Without
limiting the effect of any other provision of this Agreement, to the extent that
the Indemnitee is, by reason of such Indemnitee’s Corporate Status, a party to
and is successful, on the merits or otherwise, in any Proceeding pursuant to a
final non-appealable order, such Indemnitee shall be indemnified against all
Expenses actually and reasonably incurred by or on behalf of such Indemnitee in
connection therewith.  If the Indemnitee is not wholly successful in
such Proceeding pursuant to a final non-appealable order but is successful, on
the merits or otherwise, as to one or more but less than all claims, issues, or
matters in such Proceeding pursuant to a final non-appealable order, the Company
shall indemnify the Indemnitee against all Expenses actually and reasonably
incurred by or on behalf of such Indemnitee in connection with each successfully
resolved claim, issue or matter.  For purposes of this Article III and
without limitation, the termination of any claim, issue or matter in such
Proceeding by dismissal, with or without prejudice, shall be deemed to be a
successful result as to such claim, issue or matter.

    


    ARTICLE
IV

    


    WITNESS
EXPENSES

    


    Notwithstanding
any other provision of this Agreement, to the extent that the Indemnitee is, by
reason of such Indemnitee’s Corporate Status, a witness for any reason in any
Proceeding to which such Indemnitee is not a party, such Indemnitee shall be
indemnified against all Expenses actually and reasonably incurred by or on
behalf of such Indemnitee in connection therewith.

    


    ARTICLE
V

    


    ADVANCES

    


    (A) The
Company shall advance all reasonable Expenses incurred by or on behalf of the
Indemnitee in connection with any Proceeding within 20 days after the receipt by
the Company of a statement from the Indemnitee requesting such advance from time
to time, whether prior to or after final disposition of such
Proceeding.  Such statement shall reasonably evidence the Expenses
incurred by the Indemnitee.

    


    (B) Notwithstanding
paragraph 5(A) above, the Company shall not advance any Expenses incurred by or
on behalf of the Indemnitee as a result of any Proceeding unless all of the
following conditions are satisfied:

    


    i. the
Proceeding relates to acts or omissions with respect to the performance of
duties or services on behalf of the Company;

    


    ii. the
Proceeding is initiated by a third party who is not a stockholder of the Company
or the Proceeding is initiated by a stockholder of the Company acting in his or
her capacity as such and a court of competent jurisdiction specifically approves
such advancement; and

    


    iii. the
Indemnitee undertakes to repay the advanced funds to the Company, together with
the applicable legal rate of interest thereon, in cases in which the Indemnitee
is found not to be entitled to indemnification.

    


    ARTICLE
VI

    


    DETERMINATION
OF ENTITLEMENT TO INDEMNIFICATION

    


    (A)           To
obtain indemnification under this Agreement, the Indemnitee shall submit to the
Company a written request, including therewith such documentation and
information reasonably necessary to determine whether and to what extent the
Indemnitee is entitled to indemnification.

    


    (B)           Upon
such written request pursuant to paragraph 6(A), a determination with respect to
the Indemnitee’s entitlement thereto shall be made in the specific
case:  (i) if a Change in Control shall have occurred, by Independent
Counsel in a written opinion to the Board of Directors, a copy of which shall be
delivered to the Indemnitee (unless the Indemnitee shall request that such
determination be made by the Board of Directors or the stockholders of the
Company, in which case by the person or persons or in the manner provided in
clauses (ii) or (iii) of this paragraph (B)); (ii) if a Change in Control shall
not have occurred, (A) by the Board of Directors by a majority vote of a quorum
consisting of Disinterested Directors, or (B) if a quorum of the Board of
Directors consisting of Disinterested Directors is not obtainable, or, even if
obtainable, if such quorum 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 the Indemnitee, or (C) by the stockholders of the Company; or (iii)
as provided in paragraph 7(B) of this Agreement.  If it is so
determined that the Indemnitee is entitled to indemnification, payment to the
Indemnitee shall be made within 10 days after such determination.

    


    (C)           The
Indemnitee shall cooperate with the person or entity making such determination
with respect to the Indemnitee’s entitlement to indemnification, including
providing upon reasonable advance request any documentation or information which
is not privileged or otherwise protected from disclosure and which is reasonably
available to the Indemnitee and reasonably necessary to such
determination.  Any costs or Expenses (including attorneys’ fees and
disbursements) incurred by the Indemnitee in so cooperating shall be borne by
the Company (irrespective of the determination as to the Indemnitee’s
entitlement to indemnification) and the Company hereby indemnifies and agrees to
hold the Indemnitee harmless therefrom.

    


    (D)           In
the event the determination of entitlement to indemnification is to be made by
Independent Counsel pursuant to paragraph 6(B) hereof, the Independent Counsel
shall be selected as provided in this paragraph 6(D).  If a Change in
Control shall not have occurred, the Independent Counsel shall be selected by
the Board of Directors, and the Company shall give written notice to the
Indemnitee advising such Indemnitee of the identity of the Independent Counsel
so selected.  If a Change in Control shall have occurred, the
Independent Counsel shall be selected by the Indemnitee (unless the Indemnitee
shall request that such selection be made by the Board of Directors, in which
event the preceding sentence shall apply), and the Indemnitee shall give written
notice to the Company advising it of the identity of the Independent Counsel so
selected.  In either event, the Indemnitee, or the Company, as the
case may be, may, within seven days after such written notice of selection shall
have been given, deliver to the Company or to the Indemnitee, as the case may
be, a written objection to such selection.  Such objection may be
asserted only on the grounds that the Independent Counsel so selected does not
meet the requirements of “Independent Counsel” as defined in Article I of this
Agreement.  If such written objection is made, the Independent Counsel
so selected may not serve as Independent Counsel until a court has determined
that such objection is without merit.  If, within 20 days after
submission by the Indemnitee of a written request for indemnification pursuant
to paragraph 6(A) hereof, no Independent Counsel shall have been selected or, if
selected, shall have been objected to, either the Company or the Indemnitee may
petition a court for resolution of any objection which shall have been made by
the Company or the Indemnitee to the other’s selection of Independent Counsel
and/or for the appointment as Independent Counsel of a person selected by the
court or by such other person as the court shall designate, and the person with
respect to whom an objection is so resolved or the person so appointed shall act
as Independent Counsel under paragraph 6(B) hereof.  The Company shall
pay all reasonable fees and Expenses of Independent Counsel incurred in
connection with acting pursuant to paragraph 6(B) hereof, and all reasonable
fees and Expenses incident to the selection of such Independent Counsel pursuant
to this paragraph 6(D).  In the event that a determination of
entitlement to indemnification is to be made by Independent Counsel and such
determination shall not have been made and delivered in a written opinion within
90 days after the receipt by the Company of the Indemnitee’s request in
accordance with paragraph 6(A), upon the due commencement of any judicial
proceeding in accordance with paragraph 8(A) of this Agreement, Independent
Counsel shall be discharged and relieved of any further responsibility in such
capacity.

    


    ARTICLE
VII

    


    PRESUMPTIONS

    


    (A)           In
making a determination with respect to entitlement or indemnification hereunder,
the person or entity making such determination shall presume that the Indemnitee
is entitled to indemnification under this Agreement and the Company shall have
the burden of proof to overcome such presumption.

    


    (B)           If
the person or entity making the determination whether the Indemnitee is entitled
to indemnification shall not have made a determination within 60 days after
receipt by the Company of the request therefore, the requisite determination of
entitlement to indemnification shall be deemed to have been made and the
Indemnitee shall be entitled to such indemnification, absent:  (i) a
misstatement by the Indemnitee of a material fact, or an omission of a material
fact necessary to make the Indemnitee’s statement not materially misleading, in
connection with the request for indemnification, or (ii) a prohibition of such
indemnification under applicable law.  Such 60-day period may be
extended for a reasonable time, not to exceed an additional 30 days, if the
person or entity making said determination in good faith requires additional
time for the obtaining or evaluating of documentation and/or information
relating thereto.  The foregoing provisions of this paragraph 7(B)
shall not apply:  (i) if the determination of entitlement to
indemnification is to be made by the stockholders, and if within 15 days after
receipt by the Company of the request for such determination the Board of
Directors resolves to submit such determination to the stockholders for
consideration at an annual or special meeting thereof to be held within 75 days
after such receipt and such determination is made at such meeting, or (ii) if
the determination of entitlement to indemnification is to be made by Independent
Counsel pursuant to paragraph 6(B) of this Agreement.

    


    (C)           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 the Indemnitee to
indemnification.

    


    ARTICLE
VIII

    


    REMEDIES

    


    (A)           In
the event that:  (i) a determination is made that the Indemnitee is
not entitled to indemnification under this Agreement, or (ii) advancement of
Expenses is not timely made pursuant to this Agreement, or (iii) payment of
indemnification due the Indemnitee under this Agreement is not timely made, the
Indemnitee shall be entitled to an adjudication in an appropriate court of
competent jurisdiction of such Indemnitee’s entitlement to such indemnification
or advancement of Expenses.

    


    (B) In the
event that a determination shall have been made pursuant to this Agreement that
the Indemnitee is not entitled to indemnification, any judicial Proceeding
commenced pursuant to this Article VIII shall be conducted in all respects as a
de novo trial, on the merits and the Indemnitee shall not be prejudiced by
reason of that adverse determination.  In any judicial proceeding or
arbitration commenced pursuant to this Article VIII, the Company shall have the
burden of proving that the Indemnitee is not entitled to indemnification or
advancement of Expenses, as the case may be.

    


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

    


    (D)           The
Company shall be precluded from asserting in any judicial proceeding commenced
pursuant to this Article VIII 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.

    


    (E)           In
the event that the Indemnitee, pursuant to this Article VIII, seeks a judicial
adjudication of such Indemnitee’s rights under, or to recover damages for breach
of, this Agreement, if successful in whole or in part, 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 such
Indemnitee in such judicial adjudication.

    


    ARTICLE
IX

    


    ESTABLISHMENT
OF TRUST

    


    In the
event of a Change in Control, the Company shall, upon written request by the
Indemnitee, create a trust for the benefit of the
Indemnitee  (“Trust”) and from time-to-time upon written request by
the Indemnitee, shall fund such Trust in an amount sufficient to satisfy any and
all Expenses, judgments, penalties, fines and settlement amounts actually and
reasonably incurred by or on behalf of such Indemnitee or claimed, reasonably
anticipated or proposed to be paid in accordance with the terms of this
Agreement.  The amount to be deposited in the Trust pursuant to the
foregoing funding obligation shall be determined by Independent
Counsel.  The terms of the Trust shall provide that upon a Change in
Control:  (i) the Trust shall not be revoked or the principal thereof
invaded, without the prior written consent of the Indemnitee, (ii) the trustee
of the Trust (“Trustee”) shall advance, within two business days of a request by
the Indemnitee and in accordance with Article V of this Agreement, any and all
Expenses to the Indemnitee, (iii) the Trust shall continue to be funded by the
Company in accordance with the funding obligation set forth above, (iv) the
Trustee shall promptly pay to the Indemnitee all amounts for which the
Indemnitee shall be entitled to indemnification pursuant to this Agreement or
otherwise, and (v) all unexpended funds in such Trust shall revert to the
Company  upon a final determination by Independent Counsel that the
Indemnitee has been fully indemnified under the terms of this
Agreement.  The Trustee shall be chosen by the Indemnitee and agreed
to by the Company.  Nothing in this Article IX shall relieve the
Company of any of its obligations under this Agreement.

    


    ARTICLE
X

    


    NON-EXCLUSIVITY;
SURVIVAL OF RIGHTS; INSURANCE SUBROGATION

    


    (A)           The
rights of indemnification and to receive advancement of Expenses as provided by
this Agreement shall not be deemed exclusive of any other rights to which the
Indemnitee may at any time be entitled under applicable law, the Articles of
Incorporation, the Company’s Bylaws, any agreement, a vote of stockholders or a
resolution of the Board of Directors, or otherwise.  No amendment,
alteration or repeal of this Agreement or any provision hereof shall be
effective as to the Indemnitee with respect to any action taken or omitted by
the Indemnitee as a member of the Board of Directors prior to such amendment,
alteration or repeal.

    


    (B)           To
the extent that the Company maintains an insurance policy or policies providing
liability insurance for directors of the Company, the Indemnitee shall be
covered by such policy or policies in accordance with its or their terms to the
maximum extent of the coverage available and upon any “Change in Control” the
Company shall obtain continuation and/or “tail” coverage for the Indemnitee to
the maximum extent obtainable on commercially reasonable terms at such
time.

    


    (C)           In
the event of any payment under this Agreement, the Company shall be subrogated
to the extent of such payment to all of the rights of recovery of the
Indemnitee, who shall execute all papers required and take all actions 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)           The
Company shall not be liable under this Agreement to make any payment of amounts
otherwise indemnifiable hereunder if and to the extent that the Indemnitee has
otherwise actually received such payment under any insurance policy, contract,
agreement, or otherwise.

    


    ARTICLE
XI

    


    CONTINUATION
OF INDEMNITY

    


    All
agreements and obligations of the Company contained herein shall continue during
the period the Indemnitee is an officer or a member of the Board of Directors of
the Company and shall continue thereafter so long as the Indemnitee shall be
subject to any threatened, pending or completed Proceeding by reason of such
Indemnitee’s Corporate Status and during the period of statute of limitations
for any act or omission occurring during the Indemnitee’s term of Corporate
Status.  No legal action shall be brought and no cause of action shall
be asserted by or on behalf of the Company against the Indemnitee, the
Indemnitee’s spouse, heirs, executors or personal or legal representatives after
the expiration of two years from the date of accrual of such cause of action,
and any claim or cause of action of the Company shall be extinguished and deemed
released unless asserted by the timely filing of a legal action within such
two-year period; provided, however, that if any shorter period of limitations is
otherwise applicable to any such cause of action such shorter period shall
govern.  This Agreement shall be binding upon the Company and its
successors and assigns and shall inure to the benefit of the Indemnitee and such
Indemnitee’s heirs, executors and administrators.

    


    ARTICLE
XII

    


    SEVERABILITY

    


    If any
provision or provisions of this Agreement shall be held to be invalid, illegal,
or unenforceable for any reason whatsoever, (i) the validity, legality, and
enforceability of the remaining provisions of this Agreement (including, without
limitation, each portion of any Article of this Agreement containing any such
provision held to be invalid, illegal, or unenforceable, that is not itself
invalid, illegal, or unenforceable) shall not in any way be affected or impaired
thereby, and (ii) to the fullest extent possible, the provisions of this
Agreement (including, without limitation, each portion of any Article of this
Agreement containing any such provision held to be invalid, illegal, or
unenforceable, that is not itself invalid, illegal, or unenforceable) shall be
construed so as to give effect to the intent manifested by the provisions held
invalid, illegal, or unenforceable.

    


    ARTICLE
XIII

    


    EXCEPTIONS
TO RIGHT OF INDEMNIFICATION OR ADVANCEMENT OF EXPENSES

    


    Notwithstanding
any other provisions of this Agreement, the Indemnitee shall not be entitled to
indemnification or advancement of Expenses under this Agreement:  (i)
with respect to any Proceeding initiated by such Indemnitee against the Company
other than a Proceeding commenced pursuant to Article VIII, or (ii) with respect
to any Proceeding in which such Indemnitee’s act or omission was material to the
cause of action adjudicated and was committed in bad faith or was the result of
active and deliberate dishonesty, (iii) if the Indemnitee actually received an
improper personal benefit in money, property, or services, or (iv) as otherwise
required by paragraphs 2(B) and 2(C) of this Agreement.

    


    ARTICLE
XIV

    


    HEADINGS

    


    The
headings of the articles 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.

    


    ARTICLE
XV

    


    MODIFICATION
AND WAIVER

    


    No
supplement, modification, 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 a waiver
of any other provisions hereof (whether or not similar) nor shall such waiver
constitute a continuing waiver.

    


    ARTICLE
XVI

    


    NOTICE
BY THE INDEMNITEE

    


    The
Indemnitee agrees promptly to notify the Company in writing upon being served
with any summons, citation, subpoena, complaint, indictment, information, or
other document relating to any Proceeding or matter which may be subject to
indemnification or advancement of Expenses covered hereunder.

    


    ARTICLE
XVII

    


    NOTICES

    


    All
notices, requests, demands, and other communications hereunder shall be in
writing and shall be deemed to have been duly given if (i) delivered by hand and
receipted for by the party to whom said notice or other communication shall have
been directed, or (ii) mailed by certified or registered mail with postage
prepaid, on the third business day after the date on which it is so mailed, if
so delivered or mailed, as the case may be, to the following
addresses:

    


    If to the Indemnitee, to the address
set forth in the records of the Company.

    


    If to the Company,
to:                                                      Hines
Real Estate Investment Trust, Inc.

    2800 Post Oak Boulevard, Suite
5000

    Houston, Texas 77056-6118

    Attn: President

    


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

    


    ARTICLE
XVIII

    


    GOVERNING
LAW

    


    The
parties agree that this Agreement shall be governed by, and construed and
enforced in accordance with, the laws of the State of Maryland.

    


    


    


    [signature page
follows]

    



    
      
        
                                                                         


        

         


      

      
         


        
          

        

      

      
         


      

    

    


    IN
WITNESS WHEREOF, the parties hereto have executed this Agreement as of the day
and year written above.

    


    HINES
REAL ESTATE INVESTMENT TRUST, INC.

    


    


    By:        /s/ Charles N.
Hazen

    Name:   Charles
N. Hazen

    Title:      President
& Chief Executive Officer

    


    


    INDEMNITEE

    


    


    /s/ Paul B. Murphy,
Jr.