**Exhibit10.15**

 

 

March 2, 2004

 

 

John A. Stirek

[XXXXXXXXXX]

[XXXXXXXXXX]

 

Re:          Employment Agreement

 

Dear John:

 

We are pleased to present you with this employment letter agreement(“Agreement”) which sets forth the terms upon which you will continue to be employedby Trammell Crow Company (the “Company”, or “we”, or “us”).

 

**1.             Employment Period**.  Subject to the terms and provisions of thisAgreement, we agree to continue to employ you, and you agree to continue to beemployed by us, for a period (the “Employment Period”) commencing on thedate hereof and expiring December 31, 2006; provided, that on December 31, 2006and on each subsequent December 31, this Agreement will automatically beextended for one additional year unless, during the four****month period beginning March 1 andending July 1 immediately prior to the next scheduled extension, you or wewill have given written notice (a “Non-Renewal Notice”) that theEmployment Period will not be extended (a “Non-Renewal”).

 

**2.             Employment Terms and Conditions**.

 

(a)           Position andDuties; Extent of Services; Location. During the Employment Period, you will serve initially as the Company’sPresident of Development and Investment for the Western United States and fromtime to time will serve in such other positions as the Board of Directors ofthe Company (the “Board”) may from time to time determine.  In so doing, you will have such powers andduties (including holding officer positions with one or more Subsidiaries ofthe Company) as may be assigned from time to time by the Board.  During the Employment Period, you willdevote your full business time, energy, and best efforts to the business andaffairs of the Company.  You agree notto engage, directly or indirectly, in any other business, investment, oractivity that interferes with your performance of your duties under thisAgreement, is contrary to the interests of the Company or requires any portionof your business time, provided, however, that (i) you may serve on the boardof directors (or similar governing body) of one public company if the Board hasprovided prior approval for such service, and (ii) unless it would unreasonablyinterfere with your performance of your duties to the Company, you may serve onthe board of directors (or similar governing body) of no more than one otherorganization that does not directly or indirectly conduct a Competing Business(as defined herein), in each case which boards shall be in addition to theboards of directors (or

 

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similar governing bodies) on which you serve at the request of theCompany.   The location of yourprincipal work office will be Portland, Oregon.  “Subsidiary” means any entity 50% or more of the votingsecurities of which are owned, directly or indirectly, by the Company.

 

(b)           Compensation.  During the Employment Period, you willreceive an annual base salary (“Annual Base Salary”), payable inaccordance with the customary payroll practices of the Company for executiveofficers.  The Board, in its solediscretion, may at any time increase the amount of the Annual Base Salary as itmay deem appropriate.  From time to timeprior to a Change in Control, and following the second anniversary of suchChange in Control, the Board may decrease your Annual Base Salary in the samemanner and to the same proportional extent as the average (mean) percentagedecrease in the annual base salaries of all other members of the ExecutiveOfficer Committee.  The term “AnnualBase Salary” will refer to the Annual Base Salary as it may be so adjustedfrom time to time.  In addition, duringthe Employment Period, you will (i) be eligible to receive such annualbonus payments, if any, as the Board or the Compensation Committee of the Boardmay specify in its sole discretion (each an “Annual Bonus”), subject toany terms or conditions as may be established by the Board or its CompensationCommittee, provided, that you will be provided an individual “annual incentiveplan” for each year and any performance criteria included in such incentiveplan must be reasonably achievable**,**(ii) be entitled to participate in all incentive, savings, stock option, profitsharing and retirement plans, practices, policies and programs applicablegenerally to other executives of the Company (“Investment Plans”),subject to all of the terms and conditions of such Investment Plans; and (iii)be eligible to participate in all health, life and disability insurancepolicies, all death and disability plans, practices, policies and programs andall other welfare benefit plans, practices, policies and programs which are ineach such case applicable generally to other executives of the Company (“WelfarePlans”), subject to all of the terms and conditions of such WelfarePlans.  Subject to Sections 4 and 5, anyAnnual Bonus awarded to you by the Board or the Compensation Committee of theBoard for any calendar year will be payable in March of the following year,whether or not you are employed by the Company at such time. The term “ExecutiveOfficer Committee” will refer to the Company’s Executive Officer Committee,any successor committee thereto, and if there is no longer such a committee atthe time in question, then a comparable group of the Company’s executiveofficers (as defined in Rule 3b-7 promulgated under the Securities Exchange Actof 1934).

 

(c)           Vesting of EquityAwards.  Notwithstanding theprovisions of any plan or agreement governing such an Award (as defined in Section4(c)), all Awards granted to you that remain outstanding and unvestedimmediately prior to the occurrence of a Change in Control (as defined in Section4(d)(i)) automatically shall vest in full upon the occurrence of the Changein Control.

 

(d)           We herebymemorialize our agreement to pay you the remaining unpaid balance of arelocation bonus of $125,000 in support of your relocation from Portland toDallas in 2001, of which $62,498 remains unpaid as of the date hereof.  We shall pay you six (6) monthly payments of$10,417 per month in the first pay cycle of each month, commencing in January2004 and ending in June 2004, in full satisfaction our obligation in respectthereof.  Except as otherwise providedin Sections 4(a), 4(c), 5(a), and 5(c), our obligation tomake these monthly payments to you, or a lump sum payment to you insatisfaction thereof, will cease at such time as you are no longer employed byus for any reason.  Such monthlyrelocation bonus payments are referred to herein as the “Relocation Payments.”

 

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**3.             Termination of Employment**.

 

(a)           Death.  Your employment hereunder will terminateautomatically upon your death.

 

(b)           Disability.  If your Disability occurs, we may give you awritten Notice of Termination (herein so called), and your employment willterminate effective 30 days later if you have not returned to perform, with orwithout reasonable accommodation, the essential functions of your position on afull-time basis.  “Disability”means your inability, due to physical or mental incapacity or impairment, toperform the material duties of your position(s)with the Company for any period of more than 120 consecutive days, or for morethan 180 days, regardless of how consecutively they occur, during any 360-dayperiod.

 

(c)           Terminationby Us.  We may terminate youremployment hereunder at any time (A), subject to Section 6(b),for Cause or (B) for any reason other than Cause.  “Cause” means (i) your continued failure to substantiallyperform your obligations and duties, as determined in good faith by the Board,and which is not remedied within 30 days after your receipt of written noticethereof; (ii) commission of an act of fraud, embezzlement, misappropriation,willful misconduct or breach of fiduciary duty against the Company or otherconduct materially harmful or potentially materially harmful to the Company’sbest interest, as determined in good faith by the Board; (iii) materialbreach of Section 7 or 8 which is not cured within 30 days afteryour receipt of notice thereof, if such breach is capable of being cured; (iv)conviction, plea of no contest or nolo contendere, deferred adjudication orunadjudicated probation for any felony or any crime involving moral turpitude;(v) failure to carry out, or comply with, in any material respect, any lawfuldirective of the Board consistent with the terms of this Agreement, which isnot remedied within 30 days after receipt of written notice thereof; or (vi)unlawful use (including being under the influence) or possession of illegaldrugs.

 

(d)           Resignationby You.  You may terminate youremployment hereunder at any time (i) subject to Section 6(a), forGood Reason or (ii) without Good Reason. Prior to a Change in Control and following the second anniversary ofsuch Change in Control, “Good Reason” means (A) any material diminution(considering all previous diminutions during the Employment Period in theaggregate, including all previous diminutions during the Employment Periodwhich are not material when considered separately) in your position, authority,powers, functions, duties or responsibilities; provided, however, that Good Reason may not be asserted by youunder this clause (A) after a Non-Renewal Notice has been given; (B) therelocation or transfer of your principal office to a location more than 50miles from your regular work address as of the date hereof without your consent;(C) any reduction in your Annual Base Salary to an amount that is less than 90%of the highest Annual Base Salary in effect for you during the EmploymentPeriod; (D) any reduction in your Annual Bonus Target from your AnnualBonus Target for the calendar year 2003; (E) the receipt by you of Awards inany calendar year that differ (as to number, terms or type of Awards), in amanner adverse to you, from the Awards received by you in calendar year 2002,unless either (1) such adverse differences are in the same manner and to thesame proportional extent as the average (mean) changes made to the Awardsreceived by all other members of the Executive Officer Committee in suchcalendar year or (2) such adverse differences are directly related to the Board’sgood faith assessment of your relative contribution to the Company or yourrelative performance as compared to other members of the

 

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Executive Officer Committee; provided, however, that in the case of adversedifferences pursuant to clause (2), the receipt by you of a number of any typeof Award in such calendar year that is less than one-half of the Final AverageNumber of Awards of such type for such calendar year shall constitute GoodReason; or (F) any failure by the Company to comply with any of the provisionsof Section 2(b) which failure is not contemplated previously withinthis definition, excluding in all such cases any isolated, insubstantial andinadvertent failure not occurring in bad faith and which is remedied by theCompany promptly after receipt of notice thereof given by you.  Upon or after a Change in Control but priorto the second anniversary of such Change in Control, “Good Reason” means(A) any material diminution (considering all previous diminutions duringthe Employment Period in the aggregate, including all previous diminutionsduring the Employment Period which are not material when considered separately)in your position authority, powers, functions, duties or responsibilities ineffect immediately prior to the Change in Control (subject to the sameexclusions as provided above prior to a Change in Control and following thesecond anniversary of such Change in Control); (B) any reduction in yourAnnual Base Salary; (C) (i) any reduction in your Annual Bonus Targetfrom your Annual Bonus Target for the calendar year 2003 or (ii) theawarding to you of an Annual Bonus that is less in amount than the Annual Bonusawarded to you for the calendar year immediately preceding the year duringwhich the Change in Control occurs; (D) the receipt by you of Awards inany calendar year that differ (as to number, terms or type of Awards), in amanner adverse to you, from the Awards received by you in calendar year 2002,unless either (1) such adverse differences are in the same manner and to thesame proportional extent as the average (mean) changes made to the Awardsreceived by all other members of the Executive Officer Committee in suchcalendar year or (2) such adverse differences are directly related to theBoard’s good faith assessment of your relative contribution to the Company oryour relative performance as compared to other members of the Executive OfficerCommittee; provided, however, that in the case of adverse differences pursuantto clause (2), the receipt by you of a number of any type of Award in suchcalendar year that is less than one-half of the Final Average Number of Awardsof such type for such calendar year shall constitute Good Reason; or(E) any failure by the Company to comply with any of the provisions of Section  2(b)which failure is not contemplated previously within this definition; or(F) the relocation or transfer of your principal office to a location morethan 50 miles from your regular work address as of the date hereof without yourconsent, excluding in all such cases any isolated, insubstantial andinadvertent failure not occurring in bad faith and which is remedied by theCompany promptly after receipt of notice thereof given by you.  As used in this Agreement:

 

(i)            “AnnualBonus Target” means the percentage of your Annual Base Salary that isauthorized to be awarded to you as an Annual Bonus if certain performancecriteria are met.

 

(ii)           “FinalAverage Number of Awards” means, for any calendar year and for each type ofAward granted during such year, the quotient (rounded up to the nearest wholenumber) equal to the aggregate number of Awards of such type received by allmembers of the Adjusted EOC Group in such calendar year, divided by the numberof members of the Adjusted EOC Group in such calendar year.

 

(iii)          “AdjustedEOC Group” means, for any calendar year and for each type of Award grantedduring such year, the members of the Executive Officer Committee who areeligible to receive Awards of such type in such calendar year,

 

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excluding the Chief Executive Officer of the Company and each OutlierAward Recipient in such calendar year; provided, however, that if more than 50%of the members of the Executive Officer Committee for any calendar year aredetermined to be Outlier Award Recipients in such calendar year, then,notwithstanding the foregoing, all members of the Executive Officer Committee(excluding the Chief Executive Officer of the Company) who are eligible toreceive Awards of such type in such calendar year shall be included in theAdjusted EOC Group for such calendar year with respect to such type.

 

(iv)          “OutlierAward Recipient” means, for any calendar year and for each type of Awardgranted during such year, each member of the Executive Officer Committee(excluding the Chief Executive Officer of the Company) who is eligible toreceive Awards of such type in such calendar year and who receives a number ofAwards of such type in such calendar year that is (i) 150% or more of thePreliminary Average Number of Awards or (ii) 66 2/3% or less of the PreliminaryAverage Number of Awards.

 

(v)           “PreliminaryAverage Number of Awards” means, for any calendar year and for each type ofAward granted during such year, the quotient (rounded up to the nearest wholenumber) equal to the aggregate number of Awards of such type received by allmembers of the Executive Officer Committee (excluding the Chief ExecutiveOfficer of the Company) in such calendar year, divided by the number of membersof the Executive Officer Committee (excluding the Chief Executive Officer ofthe Company) who are eligible to receive Awards of such type in such calendaryear.

 

(vi)          Thephrase “number of Awards” refers to the underlying number of shares of capitalstock of the Company to which the applicable Award relates.

 

(e)           Expirationof Term.  Your employment will endat the expiration of the Employment Period as a result of any Non-Renewal.  Except as described in Sections 3(e)(i),(ii), and (iii) and in the definition of Change in Control, atermination of your employment under this Agreement due to the expiration ofthe Employment Period as a result of any Non-Renewal will not be deemed atermination of your employment entitling you to any benefits described in Section 4or Section 5.

 

(i)            If the Company delivers aNon-Renewal Notice to you prior to any Change in Control or after the secondanniversary of such Change in Control, upon the effectiveness of suchNon-Renewal you will be entitled to receive (i) an amount equal to your ProRata Bonus, which will be paid at such time as the Company pays its othermembers of the Executive Officer Committee their annual cash incentive bonuseswith respect to the calendar year in which termination occurs, (ii) theseverance or separation benefits (including continuation of any welfarebenefits) provided generally by us to the members of the Executive OfficerCommittee under our general policies in effect from time to time upontermination by the Company of their employment (excluding any other severanceor separation benefits available to any member of the Executive OfficerCommittee pursuant to an employment agreement and not under our generalpolicies in effect from time to time), and (iii) the other compensation andbenefits described in Section 4(b).

 

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(ii)           If the Company delivers a Non-RenewalNotice to you after a Change in Control but prior to the second anniversary ofsuch Change in Control, you will have the rights described in Section 5(c)upon the effectiveness of such Non-Renewal.

 

(iii)          If any Non-Renewal is effected at yourelection, you will be entitled to receive (i) an amount equal to your Pro RataBonus, which will be paid at such time as the Company pays its other members ofthe Executive Officer Committee their annual cash incentive bonuses withrespect to the calendar year in which termination occurs, and (ii) the othercompensation and benefits described in Section 4(b) upon the effectivenessof such Non-Renewal.

 

**4.             CompensationUpon Termination Prior to a Change in Control and After the Second Anniversaryof such Change in Control**.  Prior to a Change in Control and after thesecond anniversary of such Change in Control, conditioned on the effectivenessof a Release signed by you or your legal representative, you will be entitledto the following compensation from the Company upon the termination of youremployment, which is in lieu of any other severance pay or employment benefitsto which you might otherwise be entitled (whether contractual, under aseverance plan, the WARN Act, any other applicable law, or otherwise):

 

(a)           Deathor Disability.  If your employmentis terminated by reason of your death or Disability, the Company will pay youor your legal representative, as applicable, (A) in a cash lump sum withinthirty (30) days after the effective date of the Release, the followingamounts:  (1) the sum of your unpaidAnnual Base Salary through the date of termination and any compensationpreviously deferred by you (together with any accrued interest or earningsthereon) (“Accrued Obligations”); (2) the amount of any unpaid AnnualBonus that was awarded to you prior to the date of termination; and (3) allremaining unpaid Relocation Payments; (B) any amounts arising from yourparticipation in any Investment Plan (“Accrued Investments”), whichamounts will be payable in accordance with the terms and conditions of suchInvestment Plan; (C) any amounts to which you are entitled from your participationin, or benefits under, any Welfare Plan (“Accrued Welfare Benefits”),which amounts will be payable in accordance with the terms and conditions ofsuch Welfare Plan; and (D) an amount equal to your Pro Rata Bonus, which willbe paid at such time as the Company pays its other members of the ExecutiveOfficer Committee their annual cash incentive bonuses with respect to thecalendar year in which termination of your employment occurs.  “Pro Rata Bonus” means the amountequal to the product of (i) your Annual Bonus Target for the calendar yearin which your employment is terminated (or your Annual Bonus Target for theimmediately preceding year if you resign for Good Reason as defined in thefirst clause (D) or the second clause (C)(i) of Section 3(d)), multipliedby (ii) the amount of your Annual Base Salary for the calendar year inwhich your employment is terminated (or the highest Annual Base Salary to whichyou were entitled during the twelve months immediately preceding the date oftermination if you resign for Good Reason as defined in the first clause (C) orthe second clause (B) of Section 3(d)), multiplied by (iii) theaverage (mean) percentage of annual cash incentive bonus targets actually paidas bonuses to the members of the Executive Officer Committee as a group forsuch year, and multiplied by (iv) a fraction, the numerator of which isthe number of days that have elapsed in such calendar year as of the date oftermination, and the denominator of which is 365.  Except as described in this Section 4(a), in the event ofyour termination by reason of your death or

 

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Disability, you and your legal representatives, as applicable, willforfeit all rights to any other compensation.

 

(b)           ForCause; Resignation by You Without Good Reason; Non-Renewal Election by You orthe Company.  If your employment isterminated by us for Cause or by you without Good Reason or due to aNon-Renewal election by us or you, we will have no further obligations to youother than as set forth in Section 3(e), if applicable, and theobligation for payment of (i) Accrued Obligations (which will be payable withinthe time period set forth in Section 4(a)(A) above), (ii) theAccrued Investments and the Accrued Welfare Benefits (which will be payable inaccordance with the terms and conditions of the Investment Plans and theWelfare Plans, as applicable), and (iii) the amount of any unpaid Annual Bonusthat was awarded to you prior to the date of termination (which will be payablewithin the time period set forth in Section 4(a)(A) above).  Except as described in this Section 4(b)or in Section 3(e), if applicable, in the event of your termination bythe Company for Cause or due to your resignation without Good Reason or a Non-Renewalelection by us or you, you will forfeit all rights to any other compensation.

 

(c)           WithoutCause; Resignation for Good Reason. If we terminate your employment without Cause or you resign for GoodReason, then we will pay or provide to you:

 

(i)            a cash lump sum within thirty (30)days after the effective date of the Release equal to the aggregate of thefollowing amounts:  (A) the AccruedObligations; (B) an amount equal to one and one-half (1.5) multiplied by thesum of (x) the highest Annual Base Salary to which you were entitled during thetwelve months immediately preceding the date of termination, and (y) the sum of(i) one-half of your average (mean) Annual Bonus awarded to you for the threeyears preceding termination, plus (ii) one-half of the product of yourcurrent Annual Bonus Target (or your Annual Bonus Target for the immediatelypreceding year if you resign for Good Reason as defined in the first clause (D)of Section 3(d)), multiplied by the amount of your Annual Base Salary for thecalendar year in which your employment is terminated (or the highest AnnualBase Salary to which you were entitled during the twelve months immediatelypreceding the date of termination if you resign for Good Reason as defined inthe first clause (C) of Section 3(d)); (C) the amount of any unpaid AnnualBonus that was awarded to you prior to the date of termination; and (D) allremaining unpaid Relocation Payments;

 

(ii)           an amount equal to your Pro RataBonus, which will be paid at such time as the Company pays its other members ofthe Executive Officer Committee their annual cash incentive bonuses withrespect to the calendar year in which termination of your employment occurs;

 

(iii)          the Accrued Investments and theAccrued Welfare Benefits, which amounts will be payable in accordance with theterms and conditions of the Investment Plans and the Welfare Plans, asapplicable;

 

(iv)          if you are entitled on the date oftermination to coverage under the healthcare portion of the Trammell Crow andAssociated Companies Welfare Benefits Plan or a similar Company group healtharrangement  (the “Health Plan”),continuation of such coverage for you and your dependents for a period endingon the 180th day

 

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following the second (2nd)****anniversary of the date of termination, atthe active employee cost payable by you with respect to those costs paid by youprior to your termination; provided, however, that this coverage will counttowards the depletion of any continued health care coverage rights that you andyour dependents may have pursuant to the Consolidated Omnibus BudgetReconciliation Act of 1985, as amended (“COBRA”); provided further,however, that you or your dependents’ rights to continued health care coveragepursuant to this Section will terminate at the time you or your dependentsbecome covered, as described in COBRA, under another group health plan, andwill also terminate as of the date the Company ceases to provide coverage toits senior executives generally under any such Health Plan; and

 

(v)           upon your request and at theCompany’s sole cost and expense, your enrollment in an outplacement programwith a placement agency selected by the Company, and reasonably acceptable toyou, for a period of up to twelve months, commencing on the date oftermination.

 

Notwithstanding the provisions of any plan or agreement governing suchan Award, the Company also will continue to vest all of your outstanding Awardsthat would have otherwise vested during the eighteen (18) month periodbeginning on the date of termination and such Awards will continue to vest and,if applicable, be exercisable during such eighteen (18) month period; provided,that nothing set forth herein shall result in an extension of the term of anyAward beyond the term of the Award thatwould be applicable absent any termination of your employment; providedfurther, however, that, in the case of a termination of your employmentpursuant to this Section 4(c), if the terms of the plan or agreementgoverning such Award are more favorable to you as to vesting or exercisabilitythan the terms of this paragraph, then the more favorable term(s) of such Awardagreement or plan (in lieu of the corresponding less favorable term(s) in thisparagraph) shall govern the vesting or exercisability, as the case may be, ofsuch Award upon your termination. “Award” means any option to acquirecommon stock, restricted stock award, stock appreciation right or similarequity-based award granted under the Trammell Crow Long-Term Incentive Plan orany other option or equity-based incentive plan sponsored by the Company.  Except as described in this Section 4(c),in the event of your termination by us without Cause or by you for Good Reason,you will forfeit all rights to any other compensation.

 

(d)           Asused in this Agreement:

 

(i)            “Change in Control” has themeaning given such term in the Trammell Crow Long-Term Incentive Plan (as suchplan is in effect on the date of this Agreement, the “LTIP”); provided,however, that the occurrence of a Rule 13e-3 transaction (within the meaning ofRule 13e-3 promulgated under the Securities Exchange Act of 1934 or any similarsuccessor rule thereto) that has been approved by the Board and subsequent towhich you are part of a group (within the meaning of Section 13(d)(3) or14(d)(2) of the Securities Exchange Act of 1934 or any similar successor rulethereto) that owns more than 50%, respectively, of the then outstanding sharesof common stock and the combined voting power of the then outstanding votingsecurities entitled to vote generally in the election of directors of theCompany will not be deemed to be a Change in Control; provided, further, if,prior to any Change in Control, you terminate your employment for Good Reasonor your employment is terminated by

 

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the Company without Cause or as a result of aNon-Renewal Notice delivered by the Company prior to such Change in Control anda Change in Control occurs within 180 days after such termination, or within180 days after such Non-Renewal Notice delivery in the case of a Non-Renewal(excluding a Change in Control that occurs pursuant to an unsolicited tender orexchange offer by any person, in response to which the Company does not recommendacceptance of the person’s tender or exchange offer), then for all purposeshereof, the date of the Change of Control with respect to your employment shallmean the date immediately prior to such termination, or immediately prior tosuch Non-Renewal Notice delivery in the case of a Non-Renewal; provided,further that notwithstanding that any such transaction does not constitute aChange in Control as defined in the LTIP, a Change in Control shall be deemedto have occurred for all purposes under this Agreement upon either (A) theconsummation of a Business Combination (as defined in the LTIP) with a NationalCompetitor, unless, following such Business Combination, the conditions inclauses (B) and (C) of Section 1.6 (iii) of the LTIP are satisfied andall or substantially all of the individuals and entities who were thebeneficial owners of, respectively, the Outstanding Corporation Common Stockand Outstanding Corporation Voting Securities (each as defined in the LTIP)immediately prior to such Business Combination beneficially own, directly orindirectly, more than 60%, respectively, of the then outstanding shares ofcommon stock and the combined voting power of the then outstanding votingsecurities entitled to vote generally in the election of directors of thecorporation resulting from such Business Combination (including, withoutlimitation, a corporation which as a result of such transaction owns theCompany, or all or substantially all of the Company’s assets either directly orthrough one or more subsidiaries) in substantially the same proportions astheir ownership, immediately prior to such Business Combination, of theOutstanding Corporation Common Stock and Outstanding Corporation VotingSecurities, as the case may be, or (B) the acquisition by any NationalCompetitor (or any group (as defined in the LTIP) of which a NationalCompetitor is a controlling (within the meaning of Rule 12b-2 promulgated underthe Securities Exchange Act of 1934) member of the group) of beneficialownership (within the meaning of Rule 13d-3 promulgated under the SecuritiesExchange Act of 1934) of 40% or more of either the Outstanding CorporationCommon Stock or the Outstanding Corporation Voting Securities.  By way of clarification, any transactionwith a National Competitor that constitutes a Change in Control as defined inthe LTIP shall be considered a Change in Control for all purposes under thisAgreement.

 

(ii)          “National Competitor” means any one of the companies known as JonesLange LaSalle, Inc., Grubb and Ellis Co. and CB Richard Ellis or theirrespective successors.

 

**5.             Compensation Upon Termination Occurring On or Within Two Years After aChange in Control**.  After a Change in Control and on or beforethe second anniversary of such Change in Control, conditioned on theeffectiveness of a Release signed by you or your legal representative, you willbe entitled to the following compensation from the Company upon termination ofyour employment (including a termination resulting from the delivery of aNon-Renewal Notice by the Company or you during such two-year period), whichshall be in lieu of any other severance pay or employment benefits to which youmight otherwise be entitled (whether contractual, under a severance plan, theWARN Act, any other applicable law, or otherwise):

 

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(a)           Deathor Disability.  If your employmentis terminated by reason of your death or Disability, the Company will pay youor your legal representative, as applicable, (A) in a cash lump sum withinthirty (30) days after the effective date of the Release, the followingamounts:  (1) the Accrued Obligations;(2) the amount of any unpaid Annual Bonus that was awarded to you prior to thedate of termination; and (3) all remaining unpaid Relocation Payments; (B) theAccrued Investments, which amounts will be payable in accordance with the termsand conditions of the Investment Plans; (C) the Accrued Welfare Benefits,which amounts will be payable in accordance with the terms and conditions ofthe Welfare Plans; and (D) an amount equal to your Pro Rata Bonus, which willbe paid at such time as the Company pays its other members of the ExecutiveOfficer Committee their annual cash incentive bonuses with respect to thecalendar year in which termination of your employment occurs.  Except as described in this Section 5(a),in the event of your termination by reason of your death or Disability, you andyour legal representatives, as applicable, will forfeit all rights to any othercompensation.

 

(b)           ForCause; Resignation by You Without Good Reason.  If your employment is terminated by us for Cause or by youwithout Good Reason, we will have no further obligations to you other than forpayment of (i) Accrued Obligations (which will be payable within the timeperiod set forth in Section 5(a)(A) above), (ii) the AccruedInvestments and the Accrued Welfare Benefits (which will be payable inaccordance with the terms and conditions of the Investment Plans and theWelfare Plans, as applicable), and (iii) the amount of any unpaid Annual Bonusthat was awarded to you prior to the date of termination (which will be payablewithin the time period set forth in Section 5(a)(A) above).  Except as described in this Section 5(b),in the event of your termination by the Company for Cause or due to yourresignation without Good Reason, you will forfeit all rights to any othercompensation.

 

(c)           WithoutCause; Resignation for Good Reason; Non-Renewal Election by Company.  If your employment is terminated by theCompany without Cause or due to a Non-Renewal election made by the Company asprovided in Section 3(e)(ii) or by you for Good Reason (taking intoaccount in each such case the definition of Change in Control), then, in lieuof any other severance pay or benefits, and conditioned on the effectiveness ofa Release signed by you, the Company will pay or provide to you:

 

(i)            a cash lump sum within thirty (30)days after the effective date of the Release equal to the aggregate of thefollowing amounts:  (A) the Accrued Obligations;(B) an amount equal to two and one-half (2.5) multiplied by the sum of (x) thehighest Annual Base Salary to which you were entitled during the twelve monthsimmediately preceding the date of termination, and (y) the sum of (i) one-halfof your average (mean) Annual Bonus awarded to you for the three yearspreceding termination (or the three years preceding the year to which theAnnual Bonus in question relates if you resign for Good Reason as defined inthe second clause (C)(ii) of Section 3(d)), plus (ii) one-half of the productof your current Annual Bonus Target (or your Annual Bonus Target for theimmediately preceding year if you resign for Good Reason as defined in thesecond clause (C)(i) of Section 3(d)), multiplied by the amount of your AnnualBase Salary for the calendar year in which your employment is terminated (orthe highest Annual Base Salary to which you were entitled during the twelvemonths immediately preceding the date of termination if you resign for GoodReason as defined in the second clause (B) of Section 3(d)); (C) the amount ofany unpaid Annual Bonus that was

 

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awarded to you prior to the date oftermination; and (D) all remaining unpaid Relocation Payments; provided, however,that if the Company fails to make such lump sum payment when due and suchfailure continues for ten (10) days following notice of nonpayment to theCompany, the amount of the payment the Company is obligated to make pursuant tothis Section 5(c)(i) shall automatically be increased by twenty-five percent(25%);

 

(ii)           the Accrued Investments and theAccrued Welfare Benefits, which amounts will be payable in accordance with theterms and conditions of the Investment Plans and the Welfare Plans, as applicable;

 

(iii)          a cash lump sum within thirty (30)days after the effective date of the Release equal to the sum of (1) theunvested portion of your Matching Contribution Account under the Company’sRetirement Savings Plan, plus (2) the product of (x) two and one-half (2.5)multiplied times (y) the Matching Contribution you received for the calendaryear ended prior to the calendar year in which the Change in Control occurs;

 

(iv)          if you are entitled on the date oftermination to coverage under the healthcare portion of the Health Plan,continuation of such coverage for a period ending on the 180th day followingthe second (2nd)****anniversary ofthe date of termination, at the active employee cost payable by you withrespect to those costs paid by you prior to such termination.  Provided, however, that this coverage willcount towards the depletion of any continued health care coverage rights thatyou and your dependents may have pursuant to COBRA.  Provided further, that you or your dependents’ rights to continuedhealth care coverage pursuant to this Section will terminate at the time you oryour dependents become covered, as described in COBRA, under another grouphealth plan, and will also terminate as of the date the Company ceases toprovide coverage to its senior executives generally under any such Health Plan;

 

(v)           an amount equal to your Pro RataBonus, which will be paid at such time as the Company pays its other members ofthe Executive Officer Committee their annual cash incentive bonuses withrespect to the calendar year in which termination occurs; and

 

(vi)          upon your request and at the Company’ssole cost and expense, your enrollment in an outplacement program with aplacement agency selected by the Company, and reasonably acceptable to you, fora period of up to twelve months, commencing on the effective date of theRelease.

 

Notwithstanding the provisions of any plan or agreement governing suchan Award and without limiting Section 2(c), (A) the Company will alsocontinue to vest all of your outstanding Awards granted on or after a Change inControl that would have otherwise vested during the eighteen (18) month periodbeginning on the date of termination and such Awards will continue to vest and,if applicable, be exercisable during such eighteen (18) month period and (B)all of your outstanding Awards that are vested immediately prior to the date oftermination shall be exercisable during the eighteen (18) month periodbeginning on the date of termination; provided, however, that nothing set forthherein shall result in an extension of the term of any Award beyond the term ofthe Award that would be applicable absent any termination of your employment;provided, further, however, that, in the case of a termination of youremployment pursuant to this Section 5(c), if the terms of the plan oragreement governing such Award are

 

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more favorable to you as to vesting or exercisability than the terms ofthis paragraph, then the more favorable term(s) of such Award agreement or plan(in lieu of the corresponding less favorable term(s) in this paragraph) shallgovern the vesting or exercisability, as the case may be, of such Award uponyour termination.  Except as describedin this Section 5(c), in the event of your termination by us withoutCause or due to a Non-Renewal election made by the Company as provided in Section3(e)(ii) or by you for Good Reason (taking into account in each such casethe definition of Change in Control), you will forfeit all rights to any othercompensation.

 

(d)           Non-RenewalElection by You.  If your employmentis terminated due to a Non-Renewal Election by you, we will have no furtherobligations to you other than as set forth in Section 3(e)(iii), whichalso includes provision for the compensation and other benefits described in Section4(b).  Except as described in Section4(b) and Section 3(e)(iii), in the event of your termination due toa Non-Renewal election by you, you will forfeit all rights to any othercompensation.

 

**6.             Other Provisions Relating to Termination**.

 

(a)           GoodReason.  Upon you learning of anyevent described in the definition of Good Reason, you may terminate youremployment for Good Reason by giving a Notice of Termination (describing, ifapplicable, the action required to cure the basis for termination) to us within60 days thereafter. If the event constituting Good Reason may be cured, we willhave the opportunity to cure any such event for a period of 60 days followingreceipt of your Notice of Termination. If you do not give a Notice of Termination to us within 60 days afterlearning of an event giving rise to Good Reason, then this Agreement willremain in effect and, without any further act on your part, you will havewaived your right to terminate your employment hereunder for Good Reason inrespect of such event.

 

(b)           Cause.  Upon the Company learning of any eventdescribed in the definition of Cause, we may terminate your employment forCause by giving a Notice of Termination (describing, if applicable, the actionrequired to cure the basis for termination) to you within 60 days thereafter.If we do not give you a Notice of Termination within 60 days after learning ofan event giving rise to Cause, then this Agreement will remain in effect and,without any further act on our part, we will have waived our right to terminateyour employment for Cause in respect of such event.

 

(c)           FullSettlement; Mitigation.  In no eventwill you be obligated to seek other employment or take any other action by wayof mitigation of the amounts payable to you under any of the provisions of thisAgreement and, except for your right, if any, to continue your participation inthe Health Plan as provided herein, such amounts will not be reduced whether ornot you obtain other employment.  TheCompany will not be liable to you for any damages for breach of this Agreementarising out of the termination of your employment other than for amountspayable under Sections 3(e), 4 or 5, which amounts will bepayable subject to the terms and conditions set forth therein.  The Company will be entitled to seek damagesfrom you for any breach of Section 7 or 8 by you or for yourcriminal misconduct.

 

(d)           Releaseand Other Agreements. Notwithstanding any other provision in this Agreement to the contrary,as a condition to receiving the benefits described in this Agreement, upon anytermination of your employment hereunder you hereby agree to execute (and notrevoke) a release in substantially the form attached hereto as Exhibit A (the “Release”)

 

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and such other documents andagreements as required by the Company, in the form and pursuant to theprocedures reasonably established by the Company.  For purposes of this Agreement, the Release will be considered tohave been executed by you if it is signed by your legal representative in thecase of your legal incompetence or on behalf of your estate in the case of yourdeath.  Upon your execution and deliveryof the Release, the Company will also promptly execute and deliver the Release.

 

**7.             Confidential Information**.

 

(a)           Youacknowledge that the Company has trade, business and financial secrets andother confidential and proprietary information regarding the Company and itsbusiness, in whatever form, tangible or intangible (collectively, the “ConfidentialInformation”), and that during the course of your employment with theCompany you have received, will receive or will contribute to the ConfidentialInformation.  Confidential Informationincludes, to the extent confidential and proprietary to the Company, salesmaterials, technical information, processes and compilations of information,records, specifications and information concerning customers, prospectivecustomers or vendors, customer and prospective customer lists, and informationregarding methods of doing business. However, Confidential Information does not include your generalknowledge of and experience in the real estate business or your personal and professionalrelationships and it does not include information that (i) is obtained byyou from a source other than the Company or its affiliates who is not under aduty of non-disclosure to the Company or such affiliate or (ii) is in thepublic domain or is or becomes generally available to the public other thanthrough disclosure by you in violation of the provisions of this Agreement.

 

(b)           Youare aware of those policies implemented by the Company to keep its ConfidentialInformation secret.  You acknowledgethat the Confidential Information has been developed or acquired by the Companythrough the expenditure of substantial time, effort and money and provides theCompany with an advantage over competitors who do not know or use suchConfidential Information.

 

(c)           Duringand following your employment by the Company, you will hold in confidence andwill not directly or indirectly disclose, use, copy, make lists of, or makeavailable to others any Confidential Information except in the good faithperformance of your duties to the Company or to the extent authorized inwriting by the Board or required by law or compelled by legal process.  You agree to use reasonable efforts to givethe Company notice (accompanied by a copy of the subpoena, order or other processused to compel disclosure) of any and all attempts to compel disclosure of anyConfidential Information, in such a manner so as to provide the Company withwritten notice within one (1) business day after you are informed that suchdisclosure is being or will be compelled.

 

(d)           Youfurther agree not to use any Confidential Information for the benefit of anyperson or entity other than the Company.

 

(e)           Upontermination of your employment, you agree that all Confidential Information andother files, documents, materials and other repositories containing informationconcerning the Company or the business of the Company (including all copiesthereof) in your possession, custody or control, whether prepared by you orothers, will remain with or be returned to the Company promptly (withintwenty-four (24) hours) after the date of such termination.

 

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(f)            Notwithstandinganything herein to the contrary, you may disclose to any and all persons,without limitation of any kind, the U.S. federal income tax treatment and taxstructure of the transactions contemplated in this Agreement and all materialsof any kind (including opinions and other tax analyses) that are provided toyou relating to such tax treatment and tax structure.  For this purpose, “tax structure” is limited to facts relevant tothe U.S. federal income tax treatment of the transactions contemplated in thisAgreement and does not include information relating to the identity of theparties hereto.

 

**8.             Non-Competition; Non-Solicitation**.

 

(a)           Youacknowledge and agree that your use of Confidential Information and our listsof, and information concerning, customers and prospective customers in theconduct of business on behalf of a competitor of the Company would constituteunfair competition with the Company and would adversely affect the businessgoodwill of the Company.  Accordingly,as a material inducement to the Company to enter into this Agreement; toprotect the Company’s Confidential Information, including lists of, andinformation concerning, customers and prospective customers of the Company,that may be disclosed or entrusted to you (the disclosure of which by you inviolation of this Agreement would adversely affect the business goodwill of theCompany), the business goodwill of the Company that may be developed in you andthe business opportunities that may be disclosed or entrusted to you by theCompany; in consideration for the compensation and other benefits payablehereunder to you, for the benefits to you of having access to ConfidentialInformation, including lists of, and information concerning, customers andprospective customers of the Company, during the Employment Period (thedisclosure of which by you in violation of this Agreement would adverselyaffect the business goodwill of the Company); and for other good and valuableconsideration, you hereby covenant and agree that, during the Term ofNon-Competition, you will not directly or indirectly, individually or as anofficer, director, manager, employee, shareholder, consultant, contractor,partner, member, joint venturer, agent, equity owner or in any capacitywhatsoever:

 

(i)            own, engage in, manage, operate,join, control, be employed by, provide Competing Services to, or participate inthe ownership, management, operation or control of or provision of CompetingServices to, a Competing Business operating in the Geographic Area;

 

(ii)           recruit, hire, assist in hiring,attempt to hire, or contact or solicit with respect to hiring any person who,at any time during the twelve (12) month period ending on the date oftermination, was an employee of the Company; provided, that you may hire anyperson that served as an administrative or clerical employee at the time theiremployment with the Company terminates so long as you do not recruit, contactor solicit such employee;

 

(iii)          induce or attempt to induce anyemployee of the Company to terminate, or in any way interfere with, therelationship between the Company and any employee thereof; or

 

(iv)          induce or attempt to induce any customer,client, supplier, service provider, or other business relation of the Companyin the Geographic Area to cease doing business with the Company, or in any wayinterfere with the relationship between the Company and any such person.

 

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Notwithstanding the foregoing, the Company agrees that you may own lessthan one percent of the outstanding voting securities of any publicly tradedcompany that is a Competing Business so long as you do not otherwise participatein such competing business in any way prohibited by this Section.

 

(b)           Youacknowledge that the geographic boundaries, scope of prohibited activities, andtime duration of the preceding paragraphs in this Section are reasonable innature and are no broader than are necessary to maintain the goodwill of theCompany and the confidentiality of its Confidential Information and to protectthe goodwill and other legitimate business interests of the Company, and alsothat the enforcement of such covenants would not cause you any undue hardshipor unreasonably interfere with your ability to earn a livelihood.  If you violate the covenants andrestrictions in this Section and the Company brings legal action for injunctiveor other equitable relief, you agree that the Company will not be deprived ofthe benefit of the full period of the restrictive covenant, as a result of thetime involved in obtaining such relief. Accordingly, you agree that the provisions in this Section will have aduration determined pursuant to Subsection (a) above, computed from the datethe legal or equitable relief is granted.

 

(c)           Asused in this Agreement:

 

(i)            “Competing Business” means abusiness that competes in any material respect with the business, or any lineof business, engaged in by the Company or any of its Subsidiaries (A) at thetime in question in respect of the Term of Non-Competition occurring prior tothe date of termination of your employment and (B) as of the date oftermination of your employment in respect of the Term of Non-Competitionoccurring on and after the date of termination of your employment.

 

(ii)           “Competing Services” meansservices that, if provided to a business other than a Competing Business, wouldconstitute the conduct of a Competing Business.

 

(iii)          “Geographic Area” means thegeographic area in which the Company or any of its Subsidiaries engages in itsrespective business or any line of its business (A) at the time in question inrespect of the Term of Non-Competition occurring prior to the date oftermination of your employment and (B) as of the date of termination of youremployment in respect of the Term of Non-Competition occurring on and after thedate of termination of your employment.

 

(iv)          “Term of Non-Competition” meansthe period of time beginning on the date hereof and continuing until 5:00 p.m.,Dallas, Texas time, on:

 

(A)          the date of termination if youremployment is terminated (1) by the Company for any reason other than Cause,(2) by you for Good Reason, (3) due to a Non-Renewal election by you prior to aChange in Control or after the second anniversary of such Change in Control, or(4) due to a Non-Renewal election made by the Company at any time, or

 

(B)           the date that is twelve (12) monthsafter the date of termination if your employment is terminated (1) by theCompany for Cause, (2) by you

 

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for any reason other than Good Reason,****or (3) due to any Non-Renewal electionmade by you after a Change in Control and on or before the second anniversaryof such Change in Control.

 

(d)           Ifany court or arbitrator determines that any portion of this Section 8 isinvalid or unenforceable, the remainder of this Section 8 will notthereby be affected and will be given full effect without regard to the invalidor unenforceable provisions.  If anycourt or arbitrator construes any of the provisions of this Section 8 tobe invalid or unenforceable because of the duration or scope of such provision,such court or arbitrator will be required to reduce the duration or scope ofsuch provision, to the minimum extent necessary so as to be enforceable, and toenforce such provision as so reduced.

 

**9.             Gross-Up for Certain Taxes**.  If any of the payments or benefits due toyou under this Agreement would otherwise result in your liability for anyexcise taxes pursuant to Internal Revenue Code (“Code”) Section 4999 (“ExciseTax”) (whether at the time of payment or upon a later IRS audit), theCompany and you agree to use commercially reasonable efforts to restructure, ina manner reasonably acceptable to the Company and you, such payments orbenefits due to you so that such Excise Tax is eliminated or minimized to theextent permitted by applicable law; provided, however, that, without creatingany implication as to whether or not, under all the circumstances it would beunreasonable for you to refuse to defer receipt for a shorter period, theCompany agrees that, regardless of the circumstances, it shall not beunreasonable for you to refuse to defer receipt of a material portion of thepayments or benefits due to you under this Section 9 for more than sixmonths after the date on which such payments or benefits would otherwise becomedue to you under this Agreement.  If,despite the use of commercially reasonable efforts, the Company and you areunable either to agree on any such restructuring or to restructure the paymentsor benefits due to you under this Agreement to eliminate such Excise Tax, theCompany will reimburse you for the amount of such Excise Tax plus all federal, state and local taxesapplicable to the Company’s payment of such Excise Taxes, including anyadditional taxes due under Section 4999 of the Code with respect to paymentsmade pursuant to this provision.  Calculationsfor these purposes will assume the highest marginal rate for individualsapplicable at the time of calculation.  The intent of this Section 9 is that theCompany will pay you an additional amount (the “Gross-Up Payment”) suchthat the net amount retained by you after deduction of (i) any Excise Taximposed on any such payment or benefit; and (ii) any excise tax, federal, stateor local income, payroll, and/or other taxes, imposed on the Gross-Up Payment,will equal the amount of such payment or benefit reduced by all applicable taxeson such amount other than the Excise Tax.

 

**10.          Successors; Binding Agreement**.

 

(a)           ThisAgreement may not be assigned by you other than by will or by the laws ofdescent and distribution.  ThisAgreement will inure to the benefit of and be enforceable by your personal andlegal representatives, executors, administrators, heirs, distributees, deviseesand legatees. This Agreement will inure to the benefit of and be binding uponthe Company and its successors and assigns.

 

(b)           TheCompany will require any successor to all or substantially all of the businessand/or assets of the Company, by a written agreement in form and substancereasonably satisfactory to you, to assume expressly and agree to perform thisAgreement in the same manner

 

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and to the same extent that theCompany would be required to perform it if no such succession had takenplace.  Failure of the Company to obtainsuch agreement prior to the effectiveness of any such succession will be consideredgrounds for you to terminate your employment for Good Reason, and if you do soterminate your employment, you will be entitled to compensation from theCompany in the same amount and on the same terms as you would be entitled topursuant to Section 5 if you terminated your employment for Good Reasonthereunder after, but before the second anniversary of, a Change inControl.  As used in this Agreement andafter any such succession, “Company” will mean the Company as hereinbeforedefined and any successor and/or assigns which assumes and agrees to performthis Agreement by operation of law, or otherwise.

 

**11.          Miscellaneous**.

 

(a)           Construction.  This Agreement will be deemed draftedequally by both the parties.  Anypresumption or principle that the language is to be construed against any partywill not apply.

 

(b)           Notices.  For purposes of this Agreement, notices andall other communications provided for in this Agreement will be in writing andwill be deemed to have been duly given when (i) delivered personally; (ii) sentby facsimile or similar electronic device and confirmed; (iii) delivered byovernight express; or (iv) if sent by any other means, upon receipt.  Any notice or other communication shall bedelivered to the address set forth below the Company’s or your signaturehereto, as applicable, or to such other address as either party will havefurnished to the other in writing in accordance herewith.

 

(c)           Severability.  Except as otherwise provided in Section8(d), if any provision of this Agreement is held to be illegal, invalid orunenforceable, such provision will be fully severable; this Agreement will beconstrued and enforced as if such illegal, invalid or unenforceable provisionhad never comprised a portion of this Agreement; and the remaining provisionsof this Agreement will remain in full force and effect and will not be affectedby the illegal, invalid or unenforceable provision or by its severance fromthis Agreement.  Furthermore, except asotherwise provided in Section 8(d), in lieu of such illegal,invalid or unenforceable provision there will be added automatically as part ofthis Agreement a provision as similar in terms to such illegal, invalid orunenforceable provision as may be possible and be legal, valid and enforceable.

 

(d)           Withholding.  The Company may withhold from any amountspayable under this Agreement such Federal, state or local taxes as are requiredto be withheld pursuant to any applicable law or regulation.

 

(e)           NoWaiver.  Except as expressly setforth in this Agreement, no waiver by either party at any time of any breach bythe other party of, or compliance with, any condition or provision of thisAgreement to be performed by the other party will be deemed a waiver of similaror dissimilar provisions or conditions at any time.

 

(f)            Equitableand Other Relief.  You acknowledgethat money damages would be both incalculable and an insufficient remedy for abreach of Section 7 or 8 by you and that any such breach wouldcause the Company irreparable harm. Accordingly, the Company, in addition to any other remedies at law or inequity it may have, will be entitled, without the

 

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requirement of posting of bondor other security, to equitable relief, including injunctive relief andspecific performance, in connection with a breach of Section 7 or 8by you.  The parties agree that the onlycircumstances in which disputes between them will not be subject exclusively toarbitration pursuant to the provisions in Section 11(h) are inconnection with a breach of Section 7 or 8 by you.  If the Company files a pleading with a courtseeking immediate injunctive relief and this pleading is challenged by you andinjunctive relief sought is not awarded, the Company will pay all of your costsand attorneys’ fees.  The partiesconsent to venue in Dallas County, Texas and to the exclusive jurisdiction ofcompetent state courts or federal courts in the state or district in DallasCounty, Texas for all litigation which may be brought, subject to therequirement for arbitration hereunder, with respect to the terms of, and thetransactions and relationships contemplated by, this Agreement.

 

(g)           EntireAgreement.** **The provisions of this Agreement constitute the entireand complete understanding and agreement between the parties with respect tothe subject matter hereof.  The Companyand you acknowledge that the Indemnification Agreement, dated                              ,by and between you and the Company shall remain in full force and effect,without limitation of your rights thereunder by the terms of this Agreement.

 

(h)           Arbitration.  Except as otherwise provided in Section11(f), in the event any claim, demand, cause of action, dispute,controversy or other matter in question (“Claim”) arises out of this Agreement(or its termination) or your employment (or termination of employment) by theCompany or its Subsidiaries, then, upon the written request of you or us, suchdispute or controversy will be submitted to binding arbitration.  Any arbitration will be conducted inaccordance with the Federal Arbitration Act (“FAA”) and, to the extentan issue is not addressed by the FAA or the FAA does not apply, with thethen-current National Rules for the Resolution of Employment Disputes of theAmerican Arbitration Association (“AAA”) or other rules of the AAA asapplicable to the claims asserted.  Theresults of arbitration will be binding and conclusive on the partieshereto.  All parties agree that venuefor arbitration will be in Dallas County, Texas.  If you are the prevailing party, then you will be entitled toreimbursement by the Company for reasonable attorneys fees, reasonable costsand other reasonable expenses pertaining to the arbitration.  All proceedings conducted pursuant to this Section11(h) will be kept confidential by all parties.  **THE ARBITRATORS SHALL HAVE NOAUTHORITY TO AWARD PUNITIVE DAMAGES UNDER ANY CIRCUMSTANCES (WHETHER IT BEEXEMPLARY DAMAGES, TREBLE DAMAGES, OR ANY OTHER PENALTY OR PUNITIVE TYPE OFDAMAGES).  REGARDLESS OF WHETHER SUCHDAMAGES MAY BE AVAILABLE UNDER TEXAS LAW, YOU AND THE COMPANY EACH HEREBY WAIVETHE RIGHT, IF ANY, TO RECOVER PUNITIVE DAMAGES IN CONNECTION WITH ANYCLAIMS.  YOU AND THE COMPANY ACKNOWLEDGETHAT BY SIGNING THIS AGREEMENT YOU AND THE COMPANY ARE WAIVING ANY RIGHT THATYOU OR THE COMPANY MAY HAVE TO A JURY TRIAL OR, OTHER THAN AS EXPRESSLYPROVIDED BY SECTION 11(f), A TRIAL BEFORE A JUDGE IN CONNECTION WITH, ORRELATING TO, A CLAIM**.

 

(i)            Survival.  Sections 3(e), 4, 5, 6,7, 8, 9, 10 and 11 of this Agreement willsurvive the termination of this Agreement.

 

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(j)            GoverningLaw.  THIS AGREEMENT SHALL BEGOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF TEXASWITHOUT REFERENCE TO PRINCIPLES OF CONFLICT OF LAWS OF TEXAS OR ANY OTHERJURISDICTION, AND, WHERE APPLICABLE, THE LAWS OF THE UNITED STATES.

 

(k)           Amendments.  This Agreement may not be amended ormodified at any time except by a written instrument approved by the Board andexecuted by the Company and you.

 

(l)            Acknowledgement.  You acknowledge that you have read andunderstand this Agreement (including its legal effect), have had an opportunityto consult legal counsel regarding it, have not acted in reliance upon any representationsor promises made by the Company not contained herein, and have entered intothis Agreement freely.

 

(m)          Counterparts.  This Agreement may be executed (including byfacsimile transmission) in any number of counterparts.

 

By signing andcountersigning this Agreement in the appropriate space set forth below, we andyou have agreed to be bound by the terms and conditions set forth herein,effective as of March 2, 2004.

 
|   | Sincerely,                 |
|--------|----------------------------|
|   |                       |
|   | **TRAMMELL CROW COMPANY**, |
|   | a Delaware corporation     |
|   |                       |
|   | By:                        | /s/ ROBERT E. SULENTIC |
|   | Name:                      | Robert E. Sulentic |
|   | Title:                     | Chairman and CEO |
|   |                       |   |
|   | Address:                   | Trammell Crow Company |
|   |                       | 2001 Ross Avenue, Suite 3400 |
|   |                       | Dallas, Texas  75201 |
|   |                       | Attention:  General Counsel |
|   |                       | Telephone:  (214) 863-3000 |
|   |                       | Fax:  (214) 863-3125 |
|        |                            |  |  |

 
| ACKNOWLEDGED AND AGREED BY EXECUTIVE: |
|---------------------------------------|
|                                  |
| /s/ JOHN A. STIREK                    |   |
| Name:  John A. Stirek            |
|                                  |
| Address:                              | [XXXXXXXXXX] |
|                                  | [XXXXXXXXXX] |
|                                  | Telephone: |   |   |
|                                  | Fax: |   |   |
|                                       |  |  |  |  |

 

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