Exhibit 10.1


 


[Duke Logo]


 


December 13, 2005


 


 


	
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RE: Executive Severance


 


Dear [                         ],


 


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


 


Benefits


 


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


 


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


 





















 


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


 


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


 





















 


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


 


“Change in Control” of the Company
means:


 


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


 


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


 


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


 


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


 


(e) the
shareholders of the Company approve a merger or consolidation to which the
Company is a party (other than a merger or consolidation with a wholly-owned
subsidiary of the Company) or a share exchange in which the Company will
exchange Company shares for shares of another corporation as a result of which
the persons who were shareholders of the Company immediately before the


 





















 


effective date of such merger, consolidation or share exchange
will have beneficial ownership of less than 50% of the combined voting power
for election of directors of the surviving corporation immediately following
the effective date of such merger, consolidation or share exchange.


 


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


 


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


 


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


 


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


 


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


 


F.         If you violate
or fail to comply with any of your obligations as set forth above, no further
payments will become due or be paid to you (or your surviving spouse, designee
or estate).


 


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


 


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


 


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


 





















 


Obligations


 


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


 


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


 


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


 


3.               For a
period of two (2) years following your separation from employment, you may not
use or disclose to anyone any Confidential Information belonging to the Company
to which you may have had access while employed by the Company. “Confidential
Information” means any data or information, other than Trade Secrets, that is
important to the Company, is competitively sensitive, and is not generally
known by the public. “Confidential Information” includes, without limitation:
(1) the sales records, profit and performance records, pricing manuals, models
and related materials, sales manuals, training manuals, selling and pricing
procedures, and financing methods of the Company; (2) customer and tenant
lists, the special demands of particular customers and tenants, and the current
and anticipated requirements of customers and tenants for the properties,
products and services of the Company; (3) the specifications of any new
properties, products or services under development by the Company; and (4) the
business plans, marketing strategies, and internal financial statements and
projections of the Company. “Confidential Information” does not include
information that is or


 





















 


becomes generally known to the public;
or was already known by you prior to employment by the Company; or that you
obtain from an independent source having a bona fide right to use and disclose
such information; or that the Company approves for unrestricted release by
express authorization.


 


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


 


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


 


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


 


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


 


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


 


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


 


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


 





















 


Very truly yours,


 


DUKE REALTY CORPORATION


 


 


	
  By:

  	
   

  	
   

  
	
   

  	
  Dennis
  D. Oklak

  
	
   

  	
  Chairman
  and Chief Executive Officer

  



 


 


Agreed and accepted this         
day of                 ,
2005


 


 


	
   

  	
   

  
	
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