EXHIBIT 10.1

 

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2006 EMT Annual Incentive Plan

 

Plan Document

 

(Effective January 1, 2006)

 

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CROWN CASTLE INTERNATIONAL CORP.

2006 EMT ANNUAL INCENTIVE PLAN

  2.

OVERVIEW

This Plan Document is designed to outline the provisions of the Crown Castle
International Corp. (“CCIC” or “Company”) 2006 Executive Annual Incentive Plan
(the “Plan”) effective as of the 1st day of January 2006, in accordance with the
terms provided herein.

The Company hereby adopts the terms of the Plan as follows:

SECTION 1. OBJECTIVES

The Company’s main objectives for the Plan are:

 

  •   To provide a compensation package that is competitive with the market.

 

  •   To motivate executives by providing the appropriate reward for individual
and corporate performance based on Company goals and objectives.

 

  •   To focus business unit executives on maximizing results of their business
units, while also reinforcing the importance of teamwork at the corporate level.

 

  •   To link the Plan’s financial measures with investor expectations.

 

  •   To link the Plan’s financial and nonfinancial measures with the individual
performance of the executives.

SECTION 2. PLAN YEAR

The effective date of this Plan is January 1, 2006. The Plan will remain in
effect from January 1, 2006, to December 31, 2006 (the “Plan Year”).

SECTION 3. ADMINISTRATION

The Plan shall be administered by the Compensation Committee (the “Committee”)
of the Board of Directors (the “Board”) with oversight by the Board. The
Committee shall have the authority to review and approve: (a) the Participants
as defined in Section 4, (b) the incentive opportunities for each Participant as
defined in Section 6, (c) the methodology for determining the Performance Goals
as defined in Section 7, (d) the minimum performance requirements as described
in Section 8, and (e) the final Incentive Awards for the Participants as
described in Section 9. The Committee shall also have the authority to review
and approve any proposed amendments to the Plan throughout the Plan Year. The
Committee retains the right to discontinue or amend this Plan at any time. The
Committee may use discretion to adjust the Incentive Award levels to account for
events that impact the ability to meet the Performance Goals described in
Section 7.

The Chief Executive Officer of the Company (the “CEO”) will be responsible for
the interpretation and the day-to-day management of the Plan. The CEO shall also
make recommendations to the Committee for review and approval.

Nothing in this Plan is to be considered a guarantee of an Incentive Award.

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CROWN CASTLE INTERNATIONAL CORP.

2006 EMT ANNUAL INCENTIVE PLAN

  3.

SECTION 4. ELIGIBILITY

Executive employees who are selected by the CEO, and are approved by the
Committee, will be eligible to participate in the Plan (the “Participants”).

SECTION 5. CHANGE IN ELIGIBILITY STATUS

In making decisions regarding employees’ participation in the Plan, the CEO may
consider any factors that he or she may consider relevant. The following
guidelines are provided as general information regarding employee status changes
upon the occurrence of the events described below, provided that recommendation
to include an employee in the Plan originates from the CEO:

 

(a) New Hire, Transfer, Promotion. A newly hired, transferred or promoted
employee selected and approved as a Participant in the Plan after March 1 of the
Plan Year may participate in the Plan on a pro rata basis as of the date the
Participant was approved into the Plan. A newly hired, transferred or promoted
employee selected and approved as a Participant in the Plan prior to March 1 of
the Plan Year may participate based on a full Plan Year.

 

(b) Demotion. An Incentive Award will generally not be made to an employee who
has been demoted during the Plan Year because of performance.

 

(c) Termination. An Incentive Award will generally not be made to any
Participant whose services are terminated prior to the payment of the Incentive
Award for reasons of misconduct, failure to perform or other cause.

 

(d) Resignation. An Incentive Award will generally not be made to any
Participant who resigns for any reason, including retirement, before the
Incentive Award is made. However, if the Participant has voluntarily terminated
his or her employment with the Company’s consent, the Participant may be
considered for a pro rata Incentive Award, provided the Participant otherwise
qualifies for the Incentive Award.

 

(e) Death and Disability. A Participant whose status as an active employee is
changed prior to the payment of the Incentive Award for any reason other than
the reasons cited above may be considered for a pro rata Incentive Award,
provided the Participant otherwise qualifies for the Incentive Award. In the
event that an Incentive Award is made on behalf of an employee who has
terminated employment by reason of death, any such payments or other amounts due
will generally be paid to the Participant’s estate.

The above guidelines are subject to the terms of any applicable severance or
similar agreements. Nothing in the Plan shall confer any right to any employee
to continue in the employ of the Company.

SECTION 6. INCENTIVE OPPORTUNITY

The CEO will determine, and recommend for approval by the Committee, incentive
opportunities for each Participant. The incentive opportunities will be defined
as Incentive Opportunity Zones that represent a range of threshold, target and
maximum performance outcomes for which incremental increases in performance will
result in incremental increases in the Incentive Award.

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CROWN CASTLE INTERNATIONAL CORP.

2006 EMT ANNUAL INCENTIVE PLAN

  4.

Each Incentive Opportunity Zone will include threshold, target and maximum
incentive opportunities. The Participant’s target incentive opportunity will be
based on the Participant’s role and responsibilities, and will be expressed as a
percentage of the Participant’s base salary. The Participant’s threshold and
maximum incentive opportunities will be expressed as a Payout Multiple of the
target incentive opportunity and will also be based on the Participant’s role
and responsibilities. The tables set forth on Exhibit A outline the target
Payout Multiples for certain Participant categories.

The target incentive opportunity as a multiple of base salary, and the resulting
threshold and maximum opportunities will be determined and approved in writing
and kept on file for each Participant in the appropriate Human Resources
department.

SECTION 7. PERFORMANCE GOALS

Each Participant shall have specific performance goals (the “Performance Goals”)
determined for his or her position for the Plan Year. These Performance Goals
will be based on certain financial and nonfinancial performance measures that
support the approved business plan of the Company and/or business unit, and
should identify how the Participant will support the achievement of such goals.

Two performance categories will generally be used for each Participant:

 

1. Corporate/Business Unit Performance — There will be one or more performance
measures with equal or different weights that may be used within this category,
including without limitation any one or more of the performance criteria
described below:

 

  •   Corporate Adjusted EBITDA – calculated as EBITDA adjusted for non-cash
compensation.

 

  •   Corporate Recurring Free Cash Flow per Share – calculated as Recurring
Free Cash Flow divided by calendar year-end total CCIC common shares
outstanding.

 

  •   Business Unit Adjusted EBITDA – calculated as Business Unit EBITDA
adjusted for Business Unit non-cash compensation.

 

  •   Business Unit Recurring Free Cash Flow per Share – calculated as Business
Unit Recurring Free Cash Flow divided by calendar year-end total common shares
outstanding.

 

  •   Business Unit Net New Sales – calculated as New Tenant Revenue adjusted
for Churn.

The Performance Goals for these financial measures will generally be based on
the Company’s 2006 financial budget/forecasts as approved by the Board.

 

2. Individual Performance — The Individual Performance Goals will generally be
based on those established using the Company’s annual performance management
system.

The target mix and weighting of the Performance Goals for each Participant will
vary depending on the Participant’s role and responsibilities, as set forth on
Exhibit B.

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CROWN CASTLE INTERNATIONAL CORP.

2006 EMT ANNUAL INCENTIVE PLAN

  5.

For the financial performance measures, threshold, target, and maximum
Performance Goals will be established and aligned within the Participant’s
applicable Incentive Opportunity Zone as defined above in Section 6. The
threshold, target, and maximum Performance Goals for these financial measures,
based on the Company’s budget/forecast for 2006 are set forth on Exhibit C.

The threshold, target and maximum individual Performance Goals will be based on
how well the Participant met the goals established using the Company’s annual
performance management system. The Individual Performance Goals will be aligned
within the Participant’s applicable Incentive Opportunity Zone. While the
interpretation of how well the Individual Performance Goals are met will be more
subjective than for financial measures, the following descriptions will be used
to interpret individual performance:

 

  1. Exceeds Expectations – Defined as performance that consistently exceeds
established expectations regarding the Participant’s key individual goals.
Performance at this level creates new standards of performance. Individual
performance near or at the maximum will be achieved if the participant has
exhibited “Exceeds Expectations” performance.

 

  2. Meets Expectations - Defined as performance that consistently meets and
often exceeds established expectations regarding the Participant’s key
individual goals. Individual performance at target will be achieved if the
Participant has exhibited “Meets Expectations” performance.

 

  3. Meets Most Expectations - Defined as performance that often meets
established expectations regarding the Participant’s key individual goals, but
also requires some development. Individual performance near or at the minimum
will be achieved if the Participant has exhibited “Meets Most Expectations”
performance.

 

  4. Does Not Meet Expectations - Defined as performance that does not
consistently meet established expectations regarding the Participant’s key
individual goals and requires significant development. Individual performance at
this level will result in no individual annual incentive payment for the
Participant.

SECTION 8. MINIMUM PERFORMANCE REQUIREMENTS

There are two minimum performance requirements in order to receive a full Annual
Incentive in accordance with the Plan:

 

1. The Minimum Financial Performance Target level set forth on Exhibit C must be
achieved for Participants to be eligible for the Annual Incentive.

 

2. The business units or departments for which the Participants are responsible
must receive an acceptable 404 assessment of applicable internal controls. The
receipt of a 404 assessment with a significant deficiency or other material
internal control issues may result in a reduction or elimination of the
potential 2006 Annual Incentive for the responsible Participants and potentially
all Participants.

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CROWN CASTLE INTERNATIONAL CORP.

2006 EMT ANNUAL INCENTIVE PLAN

  6.

SECTION 9. INCENTIVE AWARD CALCULATION

The Incentive Awards will be calculated based on the Incentive Opportunity Zones
established for each Participant at the beginning of the Plan Year. The
Incentive Opportunity Zones can be depicted as target Incentive Opportunity
Curves that correlate the incentive Payout Multiples with each of the
Performance Goals.

The target Incentive Opportunity Curves for each of the Performance Goals are
set forth on Exhibit D.

At Plan Year-end, the following steps will occur to calculate each Participant’s
final Incentive Award:

 

•   The actual performance results will be plotted on each applicable Incentive
Opportunity Curve for the Participant.

 

  •   If actual performance results fall between the threshold and target, or
the target and maximum Performance Goals, the Payout Multiples will be
calculated by interpolating the actual performance results with the threshold,
target, and maximum Payout Multiples. However, no incentive will be paid if
actual results fall below the threshold Performance Goal.

 

•   Each of the resulting Payout Multiples will then be multiplied by the
weighted percentage for the applicable Performance Goal.

 

•   The products of each will then be added together to determine the total
Payout Multiple for the Participant.

 

•   The total Payout Multiple will then be applied to the Participant’s target
Incentive Award as a percentage of base salary to determine the total Incentive
Award.

An illustration of how this calculation is performed is set forth on Exhibit E.

SECTION 10. INCENTIVE AWARD PAYMENTS

Incentive Award payments in accordance with this Plan will be processed by the
second pay period following the Board of Directors approval of the Plan Year’s
financial statements.