OFFICER INDEMNIFICATION AGREEMENT
Exhibit
10.2
This Officer Indemnification Agreement, dated as of , 20___ (this “Agreement”),
is made by and between Developers Diversified Realty Corporation, an Ohio corporation (the
“Company”), and (“Indemnitee”).
RECITALS:
A. It is critically important to the Company and its shareholders that the Company be able to
attract and retain the most capable persons reasonably available to serve as officers of the
Company.
B. In recognition of the need for corporations to be able to induce capable and responsible
persons to accept positions in corporate management, Ohio law authorizes (and in some instances
requires) corporations to indemnify their directors and officers, and further authorizes
corporations to purchase and maintain insurance for the benefit of their directors and officers.
C. Indemnification by a corporation serves the dual policies of (1) allowing corporate
officials to resist unjustified lawsuits, secure in the knowledge that, if vindicated, the
corporation will bear the expense of litigation and (2) encouraging capable women and men to serve
as corporate directors and officers, secure in the knowledge that the corporation will absorb the
costs of defending their honesty and integrity.
D. Lawsuits challenging the judgment and actions of officers of corporations are frequent, and
the high costs of defending those lawsuits, and the related threat to officers’ personal assets
have made individuals less willing to undertake the responsibilities imposed on corporate officers.
E. Recent federal legislation and rules adopted by the Securities and Exchange Commission and
the national securities exchanges have imposed additional disclosure and corporate governance
obligations on officers of public companies and have exposed such officers to new and substantially
broadened civil liabilities.
F. These legislative and regulatory initiatives have also exposed officers of public companies
to a significantly greater risk of criminal proceedings, with attendant defense costs and potential
criminal fines and penalties.
G. Under Ohio law, an officer’s right to be reimbursed for the costs of defense of criminal
actions does not depend upon the merits of the claims asserted against the officer and
indemnification of the officer against criminal fines is permitted if the officer satisfies the
applicable standard of conduct.
H. Indemnitee is an officer of the Company and Indemnitee’s willingness to serve in such
capacity is predicated, in substantial part, upon the Company’s willingness to indemnify
Indemnitee in accordance with the principles reflected above, to the fullest extent permitted
by the laws of the state of Ohio, and upon the other undertakings set forth in this Agreement.
I. Therefore, in recognition of the need to provide Indemnitee with substantial protection
against personal liability, in order to procure Indemnitee’s continued service as an officer of the
Company and to enhance Indemnitee’s ability to serve the Company in an effective manner, and in
order to provide such protection pursuant to express contract rights (intended to be enforceable
irrespective of, among other things, any amendment to any provisions relating to indemnification
included in the Constituent Documents, any change in the composition of the Board or any
change-in-control or business combination transaction relating to the Company), the Company wishes
to provide in this Agreement for the indemnification of and the advancement of Expenses to
Indemnitee as set forth in this Agreement and for the continued coverage of Indemnitee under the
Company’s directors’ and officers’ liability insurance policies.
J. In light of the considerations referred to in the preceding recitals, it is the Company’s
intention and desire that the provisions of this Agreement be construed liberally, subject to their
express terms, to maximize the protections to be provided to Indemnitee hereunder.
AGREEMENT:
NOW, THEREFORE, the parties hereby agree as follows:
1. Certain Definitions. In addition to terms defined elsewhere herein, including Section 22,
the following terms have the following meanings when used in this Agreement:
(a) “Board” means the Board of Directors of the Company.
(b) “Change in Control” means the occurrence of any of the following:
(i) the Board or shareholders of the Company approve a consolidation or merger in which the
Company is not the surviving corporation, the sale of substantially all of the assets of the
Company, or the liquidation or dissolution of the Company;
(ii) any person or other entity (other than the Company or a Subsidiary or any Company
employee benefit plan (including any trustee of any such plan acting in its capacity as trustee))
purchases any Shares (or securities convertible into Shares) pursuant to a tender or exchange offer
without the prior consent of the Board, or becomes the beneficial owner of securities of the
Company representing 20% or more of the voting power of the Company’s outstanding securities
without the prior consent of the Board;
(iii) during any two-year period, individuals who at the beginning of such period constitute
the entire Board cease to constitute a majority of the Board, unless the election or the nomination
for election of each new director is approved by at least two-thirds of the directors then still in
office who were directors at the beginning of that period; or
(iv) a record date is established for determining shareholders of the Company entitled to vote
upon (A) a merger or consolidation of the Company with another real
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estate investment trust, partnership, corporation or other entity in which the Company is not
the surviving or continuing entity or in which all or a substantial part of the outstanding shares
are to be converted into or exchanged for cash, securities or other property, (B) a sale or other
disposition of all or substantially all of the assets of the Company or (C) the dissolution of the
Company.
(c) “Claim” means (i) any threatened, asserted, pending or completed claim, demand, action,
suit or proceeding, whether civil, criminal, administrative, arbitrative, investigative or other,
and whether made pursuant to federal, state or other law; and (ii) any threatened, pending or
completed inquiry or investigation, whether made, instituted or conducted by the Company or any
other person, including any federal, state or other governmental entity, that Indemnitee determines
might lead to the institution of any such claim, demand, action, suit or proceeding.
(d) “Constituent Documents” means the Company’s articles of incorporation and code of
regulations.
(e) “Controlled Affiliate” means any corporation, limited liability company, partnership,
joint venture, trust or other entity or enterprise, whether or not for profit, that is directly or
indirectly controlled by the Company. For purposes of this definition, “control” means the
possession, directly or indirectly, of the power to direct or cause the direction of the management
or policies of an entity or enterprise, whether through the ownership of voting securities, through
other voting rights, by contract or otherwise; provided that direct or indirect beneficial
ownership of capital stock or other interests in an entity or enterprise entitling the holder to
cast 20% or more of the total number of votes generally entitled to be cast in the election of
directors (or persons performing comparable functions) of such entity or enterprise shall be deemed
to constitute “control” for purposes of this definition.
(f) “Disinterested Director” means a director of the Company who is not and was not a party to
or threatened with the Claim in respect of which indemnification is sought by Indemnitee.
(g) “Exchange Act” shall mean the Securities Exchange Act of 1934, as amended.
(h) “Expenses” means attorneys’ and experts’ fees and expenses and all other costs and
expenses paid or payable in connection with investigating, defending, being a witness in or
participating in (including on appeal), or preparing to investigate, defend, be a witness in or
participate in (including on appeal), any Claim.
(i) “Incumbent Directors” means the individuals who, as of the date hereof, are directors of
the Company and any individual becoming a director subsequent to the date hereof whose election,
nomination for election by the Company’s shareholders, or appointment, was approved by a vote of at
least two-thirds of the then Incumbent Directors (either by a specific vote or by approval of the
proxy statement of the Company in which such person is named as a nominee for director, without
objection to such nomination); provided, however, that an individual shall not be an Incumbent
Director if such individual’s election or appointment to
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the Board occurs as a result of an actual or threatened election contest (as described in Rule
14a-12(c) of the Exchange Act) with respect to the election or removal of directors or other actual
or threatened solicitation of proxies or consents by or on behalf of a person other than the Board.
(j) “Indemnifiable Claim” means any Claim based upon, arising out of or resulting from (i) any
actual, alleged or suspected act or failure to act by Indemnitee in his or her capacity as a
director, officer, employee or agent of the Company or as a director, officer, employee, member,
manager, trustee or agent of any other corporation, limited liability company, partnership, joint
venture, trust or other entity or enterprise, whether or not for profit, as to which Indemnitee is
or was serving at the request of the Company as a director, officer, employee, member, manager,
trustee or agent, (ii) any actual, alleged or suspected act or failure to act by Indemnitee in
respect of any business, transaction, communication, filing, disclosure or other activity of the
Company or any other entity or enterprise referred to in clause (i) of this sentence, or (iii)
Indemnitee’s status as a current or former director, officer, employee or agent of the Company or
as a current or former director, officer, employee, member, manager, trustee or agent of the
Company or any other entity or enterprise referred to in clause (i) of this sentence or any actual,
alleged or suspected act or failure to act by Indemnitee in connection with any obligation or
restriction imposed upon Indemnitee by reason of such status. In addition to any service at the
actual request of the Company, for purposes of this Agreement, Indemnitee shall be deemed to be
serving or to have served at the request of the Company as a director, officer, employee, member,
manager, trustee or agent of another entity or enterprise if Indemnitee is or was serving as a
director, officer, employee, member, manager, trustee or agent of such entity or enterprise and (i)
such entity or enterprise is or at the time of such service was a Controlled Affiliate, (ii) such
entity or enterprise is or at the time of such service was an employee benefit plan (or related
trust) sponsored or maintained by the Company or a Controlled Affiliate, or (iii) the Company or a
Controlled Affiliate directly or indirectly caused or authorized Indemnitee to be nominated,
elected, appointed, designated, employed, engaged or selected to serve in such capacity.
(k) “Indemnifiable Losses” means any and all Losses relating to, arising out of or resulting
from any Indemnifiable Claim.
(l) “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 five years has been, retained
to represent: (i) the Company (or any subsidiary) 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 named (or, as to a
threatened matter, reasonably likely to be named) party to the Indemnifiable Claim 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.
(m) “Losses” means any and all Expenses, damages, losses, liabilities, judgments, fines,
penalties (whether civil, criminal or other) and amounts paid in settlement, including all
interest, assessments and other charges paid or payable in connection with or in respect of any of
the foregoing.
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(n) “Notification Date” means the date of receipt by the Company of written notice from
Indemnitee advising the Company of the final disposition of the applicable Indemnifiable Claim or
portion thereof to which such Indemnifiable Losses are related, out of which such Indemnifiable
Losses arose or from which such Indemnifiable Losses resulted.
(o) “ORC” means the Ohio Revised Code.
(p) “Other Indemnity Provisions” means, collectively, (i) the Constituent Documents, (ii) the
substantive laws of Ohio, and (iii) any other contract to which both Indemnitee and the Company (or
a Subsidiary of the Company) are a party.
(q) “Shares” means the Common Shares, par value $0.10 per share, of the Company.
(r) “Standard of Conduct Determination” means a determination of whether Indemnitee has
satisfied any applicable standard of conduct under Ohio law that is a legally required condition
precedent to indemnification of Indemnitee under this Agreement against Indemnifiable Losses
relating to, arising out of or resulting from an Indemnifiable Claim.
(s) “Subsidiary” means any corporation (other than the Company) in an unbroken chain of
corporations beginning with the Company if each of the corporations (other than the last
corporation in the unbroken chain) owns stock possessing 50% or more of the total combined voting
power of all classes of stock in one of the other corporations in that chain.
(t) “Undertaking” means a sworn request for advancement of Expenses substantially in the form
of Exhibit A attached hereto, with the blanks therein appropriately completed and the
proper selection made for the execution of Part A and Part B therein as set forth in Section
3(b).
2. Indemnification Obligation. Subject to Section 7, the Company shall indemnify,
defend and hold harmless Indemnitee, to the fullest extent permitted or required by the laws of the
State of Ohio in effect on the date hereof or as such laws may from time to time hereafter be
amended to increase the scope of such permitted indemnification, against any and all Indemnifiable
Claims and Indemnifiable Losses; provided, however, that, except as provided in Section 4
and Section 21, Indemnitee shall not be entitled to indemnification pursuant to this
Agreement in connection with any Claim (i) initiated by Indemnitee against the Company or any
director or officer of the Company unless the Company has joined in or consented to the initiation
of such Claim or (ii) in which judgment is rendered against Indemnitee for an accounting of profits
made from the purchase or sale of securities of the Company pursuant to the provisions of Section
16(b) of the Exchange Act.
3. Advancement of Expenses Incurred with Respect to Indemnifiable Claims.
(a) Indemnitee shall have the right to advancement by the Company prior to the final
disposition of any Indemnifiable Claim of any and all Expenses relating to, arising out of or
resulting from any Indemnifiable Claim paid or incurred by Indemnitee or which Indemnitee
determines are reasonably likely to be paid or incurred by Indemnitee. Subject to Section
3(b), Indemnitee’s right to such advancement is not subject to the satisfaction of any
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standard of conduct. Without limiting the generality or effect of the foregoing, within five
business days after any request by Indemnitee, the Company shall, in accordance with such request
(but without duplication), (i) pay such Expenses on behalf of Indemnitee, (ii) advance to
Indemnitee funds in an amount sufficient to pay such Expenses, or (iii) reimburse Indemnitee for
such Expenses; provided that Indemnitee shall repay, without interest any amounts actually advanced
to Indemnitee that, at the final disposition of the Indemnifiable Claim to which the advance
related, were in excess of amounts paid or payable by Indemnitee in respect of Expenses relating
to, arising out of or resulting from such Indemnifiable Claim. For purposes of this Section
3, the determination of when a “final disposition” of any Indemnifiable Claim will be deemed to
occur or have occurred shall be made by the person or entity that has or will make any required
Standard of Conduct Determination with respect to such Indemnifiable Claim pursuant to Section
7(b) or Section 7(c).
(b) For purposes of obtaining payments of Expenses in advance of final disposition of any
Indemnifiable Claim, Indemnitee shall submit to the Company an Undertaking averring that Indemnitee
has reasonably incurred or will reasonably incur actual Expenses in defending an Indemnifiable
Claim. The Undertaking need not be secured and the Company must accept the Undertaking without
reference to Indemnitee’s ability to repay the Expenses. In no event shall Indemnitee’s right to
the payment, advancement or reimbursement of Expenses pursuant to this Section 3 be
conditioned upon any undertaking that is less favorable to Indemnitee than, or that is in addition
to, the undertakings set forth in Exhibit A.
4. Indemnification for Expenses Incurred with Respect to Certain Claims Made by Indemnitee.
Without limiting the generality or effect of the foregoing, the Company shall indemnify and hold
harmless Indemnitee against and, if requested by Indemnitee, shall reimburse Indemnitee for, or
advance to Indemnitee, within five business days of such request, any and all Expenses paid or
incurred by Indemnitee or which Indemnitee determines are reasonably likely to be paid or incurred
by Indemnitee in connection with any Claim made, instituted or conducted by Indemnitee for (a)
indemnification or payment, advancement or reimbursement of Expenses by the Company under any
provision of this Agreement, or under any other agreement or provision of the Constituent Documents
now or hereafter in effect relating to Indemnifiable Claims, and/or (b) recovery under any
directors’ and officers’ liability insurance policies maintained by the Company, regardless in each
case of whether Indemnitee ultimately is determined to be entitled to such indemnification,
reimbursement, advance or insurance recovery, as the case may be; provided, however, that
Indemnitee shall return, without interest, any such advance of Expenses (or portion thereof) which
remains unspent at the final disposition of the Claim to which the advance related.
5. Partial Indemnity. If Indemnitee is entitled under any provision of this Agreement to
indemnification by the Company for a portion of any Indemnifiable Loss, but not for the total
amount thereof, the Company shall nevertheless indemnify Indemnitee for the portion thereof to
which Indemnitee is entitled.
6. Procedure for Notification. To obtain indemnification under this Agreement in respect of
an Indemnifiable Claim or Indemnifiable Loss, Indemnitee shall submit to the Company a written
request, including a brief description (based upon information then available to Indemnitee) of
such Indemnifiable Claim or Indemnifiable Loss. If, at the time of the receipt
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of such request, the Company has directors’ and officers’ liability insurance in effect under
which coverage for such Indemnifiable Claim or Indemnifiable Loss is potentially available, the
Company shall give prompt written notice of such Indemnifiable Claim or Indemnifiable Loss to the
applicable insurers in accordance with the procedures set forth in the applicable policies. The
Company shall provide to Indemnitee a copy of such notice delivered to the applicable insurers, and
copies of all subsequent correspondence between the Company and such insurers regarding the
Indemnifiable Claim or Indemnifiable Loss, in each case substantially concurrently with the
delivery or receipt thereof by the Company. The failure by Indemnitee to timely notify the Company
of any Indemnifiable Claim or Indemnifiable Loss shall not relieve the Company from any liability
hereunder unless, and only to the extent that, the Company did not otherwise learn of such
Indemnifiable Claim or Indemnifiable Loss and such failure results in forfeiture by the Company of
substantial defenses, rights or insurance coverage.
7. Determination of Right to Indemnification.
(a) Circumstances in Which No Standard of Conduct Determination is Required. To the extent
that Indemnitee shall have been successful on the merits or otherwise in defense of any
Indemnifiable Claim or any portion thereof or in defense of any issue or matter therein, including
dismissal without prejudice, Indemnitee shall be indemnified against all Indemnifiable Losses
relating to, arising out of or resulting from such Indemnifiable Claim in accordance with
Section 2 and no Standard of Conduct Determination shall be required.
(b) Standard of Conduct Determination Prior to a Change in Control. To the extent that (i)
the provisions of Section 7(a) are inapplicable to an Indemnifiable Claim that shall have
been finally disposed of and (ii) a Change in Control shall not have occurred, or a Change in
Control shall have occurred but Indemnitee shall have requested that the Standard of Conduct
Determination be made pursuant to this Section 7(b), any Standard of Conduct Determination
shall be made (A) by a majority vote of a quorum consisting of the Disinterested Directors, (B) if
the Disinterested Directors so direct, by a majority vote of a committee of Disinterested Directors
designated by a majority vote of all Disinterested Directors, or (C) if such quorum of
Disinterested Directors is not available or if a majority of such a quorum so directs, by
Independent Counsel in a written opinion addressed to the Board, a copy of which shall be delivered
to Indemnitee.
(c) Standard of Conduct Determination Following a Change in Control. To the extent that (i)
the provisions of Section 7(a) are inapplicable to an Indemnifiable Claim that shall have
been finally disposed of and (ii) a Change in Control shall have occurred and Indemnitee shall not
have requested that the Standard of Conduct Determination be made pursuant to Section 7(b),
the Standard of Conduct Determination shall be made by Independent Counsel in a written opinion
addressed to the Board, a copy of which shall be delivered to Indemnitee.
(d) Cooperation by Indemnitee. Indemnitee will cooperate with the person or persons making
such Standard of Conduct Determination pursuant to Section 7(b) or Section 7(c),
including providing to such person or persons, 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 Standard of
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Conduct Determination. The Company shall indemnify and hold harmless Indemnitee against and,
if requested by Indemnitee, shall reimburse Indemnitee for, or advance to Indemnitee, within five
business days of such request, any and all costs and expenses (including attorneys’ and experts’
fees and expenses) incurred by Indemnitee in so cooperating with the person or persons making such
Standard of Conduct Determination.
(e) Timing of Standard of Conduct Determination. The Company shall use its reasonable best
efforts to cause any Standard of Conduct Determination required under Section 7(b) or
Section 7(c) to be made as promptly as practicable. If (i) the person or persons empowered
or selected under Section 7(b) or Section 7(c) to make the Standard of Conduct
Determination shall not have made a determination within 30 days after the later of (A) the
Notification Date and (B) the selection of an Independent Counsel, if such determination is to be
made by Independent Counsel, that is permitted under the provisions of Section 7(g) to make
such determination and (ii) Indemnitee shall have fulfilled his/her obligations set forth in the
first sentence of Section 7(d), then Indemnitee shall be deemed to have satisfied the
applicable standard of conduct; provided that such 30-day period may be extended for a reasonable
time, not to exceed an additional 30 days, if the person or persons making such Standard of Conduct
Determination in good faith requires such additional time for the obtaining or evaluation or
documentation and/or information relating thereto.
(f) Timing of Payment. If (i) Indemnitee shall be entitled to indemnification hereunder
against any Indemnifiable Losses pursuant to Section 7(a), (ii) no determination of whether
Indemnitee has satisfied any applicable standard of conduct under Ohio law is a legally required
condition precedent to indemnification of Indemnitee hereunder against any Indemnifiable Losses, or
(iii) Indemnitee has been determined or deemed pursuant to Section 7(b), Section
7(c) or Section 7(e) to have satisfied any applicable standard of conduct under Ohio
law which is a legally required condition precedent to indemnification of Indemnitee hereunder
against any Indemnifiable Losses, then the Company shall pay to Indemnitee, within five business
days after the later of (x) the Notification Date and (y) the earliest date on which the applicable
criterion specified in clause (i), (ii) or (iii) of this Section 7(f) shall have been
satisfied, an amount equal to the amount of such Indemnifiable Losses.
(g) Selection of Independent Counsel. If a Standard of Conduct Determination is to be made by
Independent Counsel pursuant to Section 7(b), the Independent Counsel shall be selected by
the Board of Directors, and the Company shall give written notice to Indemnitee advising him or her
of the identity of the Independent Counsel so selected. If a Standard of Conduct Determination is
to be made by Independent Counsel pursuant to Section 7(c), the Independent Counsel shall
be selected by Indemnitee, and Indemnitee shall give written notice to the Company advising it of
the identity of the Independent Counsel so selected. In either case, Indemnitee or the Company, as
applicable, may, within five business days after receiving written notice of selection from the
other, deliver to the other a written objection to such selection; provided, however, that such
objection may be asserted only on the ground that the Independent Counsel so selected does not
satisfy the criteria set forth in the definition of “Independent Counsel” set forth in Section
1(l), and the objection shall set forth with particularity the factual basis of such assertion.
Absent a proper and timely objection, the person or firm so selected shall act as Independent
Counsel. If such written objection is properly and timely made and substantiated, (i) the
Independent Counsel so selected may not serve as
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Independent Counsel unless and until such objection is withdrawn or a court has determined
that such objection is without merit and (ii) the non-objecting party may, at its option, select an
alternative Independent Counsel and give written notice to the other party advising such other
party of the identity of the alternative Independent Counsel so selected, in which case the
provisions of the two immediately preceding sentences and clause (i) of this sentence shall apply
to such subsequent selection and notice. If applicable, the provisions of clause (ii) of the
immediately preceding sentence shall apply to successive alternative selections. If no Independent
Counsel that is permitted under the foregoing provisions of this Section 7(g) to make the
Standard of Conduct Determination shall have been selected within 30 days after the Company gives
its initial notice pursuant to the first sentence of this Section 7(g) or Indemnitee gives
its initial notice pursuant to the second sentence of this Section 7(g), as the case may
be, either the Company or Indemnitee may petition a court of competent jurisdiction for resolution
of any objection which shall have been made by the Company or Indemnitee to the other’s selection
of Independent Counsel and/or for the appointment as Independent Counsel of a person or firm
selected by the court or by such other person as the court shall designate, and the person or firm
with respect to whom all objections are so resolved or the person or firm so appointed will act as
Independent Counsel. In all events, the Company shall pay all of the reasonable fees and expenses
of the Independent Counsel incurred in connection with the Independent Counsel’s determination
pursuant to Section 7(b) or Section 7(c).
8. Presumption of Entitlement. In making any Standard of Conduct Determination, the person or
persons making such determination shall presume that Indemnitee has satisfied the applicable
standard of conduct, and the Company may overcome such presumption only by its adducing clear and
convincing evidence to the contrary. Any Standard of Conduct Determination that is adverse to
Indemnitee may be challenged by Indemnitee in the state or federal courts in Ohio. No
determination by the Company (including by its directors or any Independent Counsel) that
Indemnitee has not satisfied any applicable standard of conduct shall be a defense to any Claim by
Indemnitee for indemnification or reimbursement or advance payment of Expenses by the Company
hereunder or create a presumption that Indemnitee has not met any applicable standard of conduct.
9. No Other Presumption. For purposes of this Agreement, the termination of any Claim by
judgment, order, settlement (whether with or without court approval) or conviction, or upon a plea
of nolo contendere or its equivalent, will not create a presumption that Indemnitee did not meet
any applicable standard of conduct or that indemnification hereunder is otherwise not permitted.
10. Non-Exclusivity. The rights of Indemnitee hereunder will be in addition to any other
rights Indemnitee may have under any Other Indemnity Provisions; provided, however, that (a) to the
extent that Indemnitee otherwise would have any greater right to indemnification under any Other
Indemnity Provision, Indemnitee will be deemed to have such greater right hereunder and (b) to the
extent that any change is made to any Other Indemnity Provision which permits any greater right to
indemnification than that provided under this Agreement as of the date hereof, Indemnitee will be
deemed to have such greater right hereunder. The Company will not adopt any amendment to any of
the Constituent Documents the effect of which would be to deny, diminish or encumber Indemnitee’s
right to indemnification under this Agreement or any Other Indemnity Provision.
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11. Liability Insurance and Funding. For the duration of Indemnitee’s service as an officer
of the Company, and thereafter for so long as Indemnitee shall be subject to any pending or
possible Indemnifiable Claim, the Company shall use commercially reasonable efforts (taking into
account the scope and amount of coverage available relative to the cost thereof) to cause to be
maintained in effect policies of directors’ and officers’ liability insurance providing coverage
for directors and/or officers of the Company that is at least substantially comparable in scope and
amount to that provided by the Company’s current policies of directors’ and officers’ liability
insurance. The Company shall provide Indemnitee with a copy of all directors’ and officers’
liability insurance policies in effect from time to time. Without limiting the generality or
effect of the two immediately preceding sentences, the Company shall not discontinue or
significantly reduce the scope or amount of coverage from one policy period to the next (i)
without the prior approval thereof by a majority vote of the Incumbent Directors, even if less than
a quorum, or (ii) if at the time that any such discontinuation or significant reduction in the
scope or amount of coverage is proposed there are no Incumbent Directors, without the prior written
consent of Indemnitee (which consent shall not be unreasonably withheld or delayed). In all
policies of directors’ and officers’ liability insurance obtained by the Company, Indemnitee shall
be named as an insured in such a manner as to provide Indemnitee the same rights and benefits,
subject to the same limitations, as are accorded to the Company’s directors and officers most
favorably insured by such policy. The Company may, but shall not be required to, create a trust
fund, grant a security interest or use other means, including a letter of credit, to ensure the
payment of such amounts as may be necessary to satisfy its obligations to indemnify and advance
expenses pursuant to this Agreement.
12. Subrogation. In the event of payment under this Agreement, the Company shall be
subrogated to the extent of such payment to all of the related rights of recovery of Indemnitee
against other persons or entities (other than Indemnitee’s successors), including any entity or
enterprise referred to in clause (i) of the definition of “Indemnifiable Claim” in Section
1(j). Indemnitee shall execute all papers reasonably required to evidence such rights (all of
Indemnitee’s reasonable Expenses, including attorneys’ fees and charges, related thereto to be
reimbursed by or, at the option of Indemnitee, advanced by the Company).
13. No Duplication of Payments. The Company shall not be liable under this Agreement to make
any payment to Indemnitee in respect of any Indemnifiable Losses to the extent Indemnitee has
otherwise actually received payment (net of Expenses incurred in connection therewith) under any
insurance policy, the Constituent Documents, Other Indemnity Provisions or otherwise (including
from any entity or enterprise referred to in clause (i) of the definition of “Indemnifiable Claim”
in Section 1(j)) in respect of such Indemnifiable Losses otherwise indemnifiable hereunder.
14. Defense of Claims. The Company shall be entitled to participate in the defense of any
Indemnifiable Claim or to assume the defense thereof, with counsel reasonably satisfactory to
Indemnitee; provided that if Indemnitee believes, after consultation with counsel selected by
Indemnitee, that (a) the use of counsel chosen by the Company to represent Indemnitee would present
such counsel with an actual or potential conflict, (b) the named parties in any such Indemnifiable
Claim (including any impleaded parties) include both the Company and Indemnitee and Indemnitee
shall conclude that there may be one or more legal defenses available to Indemnitee that are
different from or in addition to those available to the Company,
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or (c) any such representation by such counsel would be precluded under the applicable
standards of professional conduct then prevailing, then Indemnitee shall be entitled to retain
separate counsel (but not more than one law firm plus, if applicable, local counsel in respect of
any particular Indemnifiable Claim) at the Company’s expense. The Company shall not be liable to
Indemnitee under this Agreement for any amounts paid in settlement of any threatened or pending
Indemnifiable Claim effected without the Company’s prior written consent. The Company shall not,
without the prior written consent of Indemnitee, effect any settlement of any threatened or pending
Indemnifiable Claim to which Indemnitee is, or could have been, a party unless such settlement
solely involves the payment of money and includes a complete and unconditional release of
Indemnitee from all liability on any claims that are the subject matter of such Indemnifiable
Claim. Neither the Company nor Indemnitee shall unreasonably withhold its consent to any proposed
settlement; provided that Indemnitee may withhold consent to any settlement that does not provide a
complete and unconditional release of Indemnitee.
15. Successors and Binding Agreement. (a) The Company shall require any successor (whether
direct or indirect, by purchase, merger, consolidation, reorganization or otherwise) to all or
substantially all of the business or assets of the Company, by agreement in form and substance
satisfactory to Indemnitee and his or her counsel, expressly to assume and agree to perform this
Agreement in the same manner and to the same extent the Company would be required to perform if no
such succession had taken place. This Agreement shall be binding upon and inure to the benefit of
the Company and any successor to the Company, including any person acquiring directly or indirectly
all or substantially all of the business or assets of the Company whether by purchase, merger,
consolidation, reorganization or otherwise (and such successor will thereafter be deemed the
“Company” for purposes of this Agreement), but shall not otherwise be assignable or delegatable by
the Company.
(b) This Agreement shall inure to the benefit of and be enforceable by Indemnitee’s personal
or legal representatives, executors, administrators, heirs, distributees, legatees and other
successors.
(c) This Agreement is personal in nature and neither of the parties hereto shall, without the
consent of the other, assign or delegate this Agreement or any rights or obligations hereunder
except as expressly provided in Section 15(a) and Section 15(b). Without limiting
the generality or effect of the foregoing, Indemnitee’s right to receive payments hereunder shall
not be assignable, whether by pledge, creation of a security interest or otherwise, other than by a
transfer by Indemnitee’s will or by the laws of descent and distribution, and, in the event of any
attempted assignment or transfer contrary to this Section 15(c), the Company shall have no
liability to pay any amount so attempted to be assigned or transferred.
16. Notices. For all purposes of this Agreement, all communications, including notices,
consents, requests or approvals, required or permitted to be given hereunder shall be in writing
and shall be deemed to have been duly given when hand delivered or dispatched by electronic
facsimile transmission (with receipt thereof orally confirmed), or five business days after having
been mailed by United States registered or certified mail, return receipt requested, postage
prepaid or one business day after having been sent for next day delivery by a nationally recognized
overnight courier service, addressed to the Company (to the attention of the Secretary of the
Company) and to Indemnitee at the applicable address shown on the signature page hereto,
11
or to such other address as any party may have furnished to the other in writing and in
accordance herewith, except that notices of changes of address will be effective only upon receipt.
17. Governing Law. The validity, interpretation, construction and performance of this
Agreement shall be governed by and construed in accordance with the substantive laws of the State
of Ohio, without giving effect to the principles of conflict of laws of such State. The Company
and Indemnitee each hereby irrevocably consent to the jurisdiction of the state and federal courts
in Ohio for all purposes in connection with any action or proceeding which arises out of or relates
to this Agreement and agree that any action instituted under this Agreement shall be brought only
in the state or federal courts in Ohio.
18. Validity. If any provision of this Agreement or the application of any provision hereof
to any person or circumstance is held invalid, unenforceable or otherwise illegal, the remainder of
this Agreement and the application of such provision to any other person or circumstance shall not
be affected, and the provision so held to be invalid, unenforceable or otherwise illegal shall be
reformed to the extent, and only to the extent, necessary to make it enforceable, valid or legal.
In the event that any court or other adjudicative body shall decline to reform any provision of
this Agreement held to be invalid, unenforceable or otherwise illegal as contemplated by the
immediately preceding sentence, the parties thereto shall take all such action as may be necessary
or appropriate to replace the provision so held to be invalid, unenforceable or otherwise illegal
with one or more alternative provisions that effectuate the purpose and intent of the original
provisions of this Agreement as fully as possible without being invalid, unenforceable or otherwise
illegal.
19. Prior Agreements. This Agreement shall supersede any and all indemnification agreements
between the Company and Indemnitee.
20. Miscellaneous. No provision of this Agreement may be waived, modified or discharged
unless such waiver, modification or discharge is agreed to in writing signed by Indemnitee and the
Company. No waiver by either party hereto at any time of any breach by the other party hereto or
compliance with any condition or provision of this Agreement to be performed by such other party
shall be deemed a waiver of similar or dissimilar provisions or conditions at the same or at any
prior or subsequent time. No agreements or representations, oral or otherwise, expressed or
implied with respect to the subject matter hereof have been made by either party that are not set
forth expressly in this Agreement.
21. Legal Fees and Expenses. It is the intent of the Company that Indemnitee not be required
to incur legal fees and or other Expenses associated with the interpretation, enforcement or
defense of Indemnitee’s rights under this Agreement by litigation or otherwise because the cost and
expense thereof would substantially detract from the benefits intended to be extended to Indemnitee
hereunder. Accordingly, without limiting the generality or effect of any other provision hereof,
if it should appear to Indemnitee that the Company has failed to comply with any of its obligations
under this Agreement (including its obligations under Section 3) or in the event that the
Company or any other person takes or threatens to take any action to declare this Agreement void or
unenforceable, or institutes any litigation or other action or proceeding designed to deny, or to
recover from, Indemnitee the benefits provided or intended to be
12
provided to Indemnitee hereunder, the Company irrevocably authorizes Indemnitee from time to
time to retain counsel of Indemnitee’s choice, at the expense of the Company as hereafter provided,
to advise and represent Indemnitee in connection with any such interpretation, enforcement or
defense, including the initiation or defense of any litigation or other legal action, whether by or
against the Company or any director, officer, shareholder or other person affiliated with the
Company, in any jurisdiction. Notwithstanding any existing or prior attorney-client relationship
between the Company and such counsel, the Company irrevocably consents to Indemnitee’s entering
into an attorney-client relationship with such counsel, and in that connection the Company and
Indemnitee agree that a confidential relationship shall exist between Indemnitee and such counsel.
Without respect to whether Indemnitee prevails, in whole or in part, in connection with any of the
foregoing, the Company will pay and be solely financially responsible for any and all attorneys’
and related fees and expenses incurred by Indemnitee in connection with any of the foregoing.
22. Certain Interpretive Matters. Unless the context of this Agreement otherwise requires,
(a) “it” or “its” or words of any gender include each other gender, (b) words using the singular or
plural number also include the plural or singular number, respectively, (c) the terms “hereof,”
“herein,” “hereby” and derivative or similar words refer to this entire Agreement, (d) the terms
“Article,” “Section,” “Annex” or “Exhibit” refer to the specified Article, Section, Annex or
Exhibit of or to this Agreement, (e) the terms “include,” “includes” and “including” will be deemed
to be followed by the words “without limitation” (whether or not so expressed), (f) the word “or”
is disjunctive but not exclusive, and (g) descriptive headings of the Sections and subsections of
this Agreement are inserted for convenience only and will not control or affect the meaning or
construction of any of the provisions of this Agreement. Whenever this Agreement refers to a
number of days, such number will refer to calendar days unless business days are specified and
whenever action must be taken (including the giving of notice or the delivery of documents) under
this Agreement during a certain period of time or by a particular date that ends or occurs on a
non-business day, then such period or date will be extended until the immediately following
business day. As used herein, “business day” means any day other than Saturday, Sunday or a United
States federal holiday.
23. Counterparts. This Agreement may be executed in one or more counterparts, each of which
will be deemed to be an original but all of which together shall constitute one and the same
agreement.
[Signatures Appear On Following Page]
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IN WITNESS WHEREOF, Indemnitee has executed, and the Company has caused its duly authorized
representative to execute, this Agreement as of the date first above written.
| DEVELOPERS DIVERSIFIED REALTY CORPORATION 0000 Xxxxxxxxxx Xxxxxxx Xxxxxxxxx, Xxxx 00000 |
||||
| By: | ||||
| Name: | ||||
| Title: | ||||
| [INDEMNITEE] [Address] |
||||
| [Indemnitee] | ||||
14
EXHIBIT A
UNDERTAKING
STATE OF OHIO
|
) | |||||
| ) | SS | |||||
COUNTY OF __________________
|
) |
I, ____________________________________, being first duly sworn, do depose and say as follows:
1. This Undertaking is submitted pursuant to the Officer Indemnification Agreement, dated
____________, 2009, between Developers Diversified Realty Corporation, an Ohio corporation (the
“Company”) and the undersigned.
2. I am requesting payment of Expenses that I have reasonably incurred or will reasonably
incur in defending an Indemnifiable Claim referred to in the aforesaid Officer Indemnification
Agreement.
3. The Expenses for which payment is requested are,
in general, all expenses related to _________________________________________
_________________________________________________________________________________________________________________
_________________________________________________________________________________________________________________.
4. I hereby undertake to repay the amounts paid pursuant hereto if and to the extent it
ultimately is determined that I am not entitled to be indemnified by the Company for all or part of
such amounts under the aforesaid Officer Indemnification Agreement or otherwise.
_____________________________________________
[Indemnitee Name]
Subscribed and sworn to before me, a Notary
Public in and for said County and State, this
______ day of __________________, ______.
[Seal]
My
commission expires the ______ day of __________________, ______.
