##### Table of Contents



UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
 Washington, D.C. 20549
 FORM 10-K/A
  þ
    
    ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
 For the fiscal year ended December 31, 2006.
 OR
 o
    
    TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
 For the transition period from  to
 Commission file numbers
    
    0-51912
0-51913
 CRESCENT REAL ESTATE EQUITIES LIMITED PARTNERSHIP
CRESCENT FINANCE COMPANY*
 
  DELAWARE 
DELAWARE
    
    75-2531304
42-1536518(State or other jurisdiction of incorporation 
or organization)
    
    (I.R.S. Employer Identification Number)
  
 (817) 321-2100
     
  o þ
  o þ
  þ o
 þ
  o þ o
  o þ
  *
    
    Crescent Finance Company meets the conditions set forth in General Instruction I(1)(a) and
(b) of Form 10-K and therefore is filing this form with the reduced disclosure format.




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##### 



TABLE OF CONTENTS
 PagePART III.Item 10.
    
    Trust Managers, Executive Officers ad Corporate Governance
    
    ___Item 11.
    
    Executive Compensation
    
    ___Item 12.
    
    Security Ownership of Certain Beneficial Owners and Management and Related
Stockholder Matters
    
    ___Item 13
    
    Certain Relationships and Related Transactions, and Trust Manager Independence
    
    ___Item 14.
    
    Principal Accountant Fees and Services
    
    ___Certifications of CEO and CFO Pursuant to Section 302Certifications of CEO and CFO pursuant to Section 906Certification of CEO and CFO Pursuant to Section 302Certification of CEO and CFO Pursuant to Section 906




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PART III
 
 Item 10. Directors and Executive Officers of the Registrant
 Trust Managers
  Name
    
    Term Expires
    
    Age
    
    PositionRichard E. Rainwater
    
    
    2009
    
    
    
    62
    
    
    Chairman of the Board of Trust ManagersJohn C. Goff
    
    
    2008
    
    
    
    51
    
    
    Vice Chairman of the Board of Trust
Managers, Chief Executive Officer of
the Company and the General Partner,
and Sole Director of the General
PartnerDennis H. Alberts
    
    
    2007
    
    
    
    58
    
    
    Trust Manager and President and Chief
Operating Officer of the Company and
the General PartnerAnthony M. Frank
    
    
    2009
    
    
    
    75
    
    
    Trust ManagerWilliam F. Quinn
    
    
    2009
    
    
    
    59
    
    
    Trust ManagerPaul E. Rowsey, III
    
    
    2008
    
    
    
    52
    
    
    Trust ManagerRobert W. Stallings
    
    
    2008
    
    
    
    58
    
    
    Trust ManagerTerry N. Worrell
    
    
    2007
    
    
    
    62
    
    
    Trust Manager
  Richard E. Rainwater
 John C. Goff
 1




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Dennis H. Alberts,
 Anthony M. Frank
 William F. Quinn
 Paul E. Rowsey, III
 Robert W. Stallings
 Terry N. Worrell
 2




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Executive Officers
  Name
    
    Age
    
    PositionJohn C. Goff
    
    
    51
    
    
    Vice Chairman of the Board of Trust
Managers of the Company, Chief Executive
Officer of the Company and the General
Partner, and Sole Director of the General
PartnerDennis H. Alberts
    
    
    58
    
    
    Trust Manager of the Company and President
and Chief Operating Officer of the Company
and the General PartnerJohn P. Albright
    
    
    41
    
    
    Managing Director, Investments of the
Company and the General PartnerDavid M. Dean
    
    
    46
    
    
    Managing Director, Law and Secretary of the
Company and the General PartnerThomas G. Miller
    
    
    51
    
    
    Managing Director, Investments of the
Company and the General PartnerJane E. Mody
    
    
    55
    
    
    Managing Director, Chief Financial Officer
of the Company and the General PartnerJane B. Page
    
    
    46
    
    
    Managing Director, Asset Management of the
Company and the General PartnerPaul R. Smith
    
    
    47
    
    
    Managing Director, Fund Management of the
Company and the General PartnerJohn L. Zogg, Jr.
    
    
    43
    
    
    Managing Director, Asset Management of the
Company and the General PartnerChristopher T. Porter
    
    
    41
    
    
    Senior Vice President and Treasurer of the
Company and the General PartnerSuzanne K. Stevens
    
    
    38
    
    
    Senior Vice President and Chief Accounting
Officer of the Company and the General
Partner
  John P. Albright
 David M. Dean,
 3




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Thomas G. Miller
 Jane E. Mody
 Jane B. Page,
 Paul R. Smith
 John L. Zogg, Jr.
 4




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Christopher T. Porter
 Suzanne K. Stevens
 Section 16(a) Beneficial Ownership Reporting Compliance
 3 4
  Code of Business Conduct
 www.crescent.com
 Shareholder Recommendations for Trust Manager Nominations
  5




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##### Table of Contents



Audit Committee
  
 Item 11. Executive Compensation
 Compensation Discussion and Analysis
 Compensation Philosophy and Objectives
  
    
    Total compensation provided to our executive officers should be at levels
commensurate with their individual responsibilities and performance and our sustained
long term performance.
    
    A significant portion of each executive officers total compensation should be
provided in the form of performance-based compensation.
    
    Performance measures based on individual goals and objectives established by the
Companys Executive Compensation Committee of the Board of Trust Managers (for purposes
of this section, the Committee) for the executive officers should reward executive
officers for performance within the executive officers responsibilities that help us
achieve operational targets and strategic milestones and that we believe are in the
best interest of our shareholders.
    
    Performance measures based on our financial performance should reward executive
officers for increases in shareholder value as well as for achieving business goals
that influence shareholder value over time.
  Executive Compensation Policies
 Accounting and Tax Considerations
 6




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Stock Ownership Guidelines
 Timing of Equity Awards
 Recoupment of Incentive Compensation
 Compensation Components
  
    
    Base salary,
    
    Short-term non-equity incentive compensation in the form of annual cash awards under
our Annual Incentive Plan (the Bonus Plan) for all executive officers (other than the
Chief Executive Officer);
    
    Short-term non-equity incentive compensation in the form of annual cash awards to
the Chief Executive Officer;
    
    Long-term equity incentive compensation in the form of restricted units of limited
partnership interest in the Operating Partnership (Units) awarded under the 2004
Crescent Real Estate Equities Partnership Long Term Incentive Plan (the LTI Plan) and
the 2005 Crescent Real Estate Equities Limited Partnership Long Term Incentive Plan
(the Performance Plan); and
    
    Benefits and other perquisites.
 Base Salary
  Short-Term Non-Equity Incentive Compensation (Bonus Plan Awards and CEO Awards)
 Bonus Plan
 
    
    the positions covered by the Bonus Plan,
    
    the varying levels of bonus that the individual holding each position is eligible to earn for the year, and
    
    the levels of performance necessary to earn each level of bonus, as measured in three components.
 7




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Name
    
    Corporate
    
    Functional Unit
    
    IndividualJerry R. Crenshaw, Jr.
    
    
    50
    %
    
    
    35
    %
    
    
    15
    %Dennis H. Alberts
    
    
    50
    %
    
    
    
    
    
    
    50
    %Jane E. Mody
    
    
    50
    %
    
    
    35
    %
    
    
    15
    %John L. Zogg, Jr.
    
    
    30
    %
    
    
    55
    %
    
    
    15
    %
  Bonus Potential as aPercentage ofName
    
    
    
    
    
    
    
    
    
    Base SalaryJerry R. Crenshaw, Jr.
    
    
    
    
    
    
    
    
    
    
    110
    %Dennis H. Alberts
    
    
    
    
    
    
    
    
    
    
    150
    %Jane E. Mody
    
    
    
    
    
    
    
    
    
    
    110
    %John L. Zogg, Jr.
    
    
    
    
    
    
    
    
    
    
    110
    %
  
    
    the threshold performance level for the Corporate component was not achieved;
    
    the functional unit component was achieved in full for each eligible named executive officer; and
    
    the individual component was achieved in full for each eligible named executive
officer, other than Mr. Alberts.
  8




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CEO Awards
 Long-Term Equity Incentive Compensation (Equity Incentive Plans)
     LTI Plan.
   9




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Performance Plan.
    Benefits and Perquisites
     10




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Summary Compensation Table
  Change inPension ValueandNon-Equity
    
    NonqualifiedOption
    
    Incentive Plan
    
    DeferredName and Principal
    
    
    
    
    
    
    
    
    
    
    
    
    
    Stock
    
    Awards
    
    Compensation
    
    Compensation
    
    All OtherPosition
    
    Year
    
    Salary
    
    Bonus
    
    Awards (1)
    
    (1)
    
    (2)
    
    Earnings
    
    Compensation
    
    TotalJohn C. Goff,
Chief Executive
Officer
    
    
    2006
    
    
    $
    900,000
    
    
    
    
    
    
    $
    3,611,192
    
    
    $
    782,160
    
    
    
    
    
    
    
    
    
    
    $
    234,325
    (5)
    
    $
    5,527,677Jerry R. Crenshaw,
Jr.,
Former Managing
Director and Chief
Financial Officer
(3)
    
    
    2006
    
    
    $
    365,000
    
    
    
    
    
    
    $
    467,909
    
    
    $
    45,330
    
    
    $
    200,750
    
    
    
    
    
    
    $
    19,829
    (6)
    
    $
    1,098,818Dennis H. Alberts,
President and Chief
Operating Officer
    
    
    2006
    
    
    $
    500,000
    
    
    
    
    
    
    $
    1,730,996
    
    
    $
    285,236
    
    
    
    
    
    
    
    
    
    
    $
    31,560
    (7)
    
    $
    2,547,792Jane E. Mody,
Managing Director
and Chief Financial
Officer (4)
    
    
    2006
    
    
    $
    385,000
    
    
    
    
    
    
    $
    510,024
    
    
    $
    78,216
    
    
    $
    211,750
    
    
    
    
    
    
    $
    39,908
    (8)
    
    $
    1,224,898John L. Zogg, Jr.,
Managing Director,
Asset Management
    
    
    2006
    
    
    $
    350,000
    
    
    
    
    
    
    $
    478,415
    
    
    $
    34,016
    
    
    $
    269,500
    
    
    
    
    
    
    $
    36,422
    (9)
    
    $
    1,168,353
 
 (1)
    
    Amounts in these columns represent the dollar amount recognized for
financial statement reporting purposes with respect to fiscal year
2006 in accordance with Financial Accounting Standards Board
Statement of Financial Accounting Standards No. 123 (revised
2004) Share-Based Payment (FAS 123R), and thus include amounts from awards granted prior to 2006. Our calculations in accordance
with FAS 123R were made with the assumptions and other criteria, as set forth in note 16 to our
consolidated financial statements for the year ended December 31, 2006 set forth in our Annual
Report on Form 10-K for the year ended December 31, 2006.(2)
    
    Pursuant to our Bonus Plan, as described in greater detail under Compensation
Discussion and Analysis, executive officers are eligible for non-equity incentive compensation in
the form of incentive bonuses that are paid based upon achievement of corporate, functional unit
and/or individual objectives. Bonuses under the Bonus Plan are accrued in the fiscal year earned
and paid in the following fiscal year. The amounts identified in this column were paid in February
2007.(3)
    
    Resigned as an executive officer effective as of March 29, 2007.(4)
    
    Served as Managing Director, Capital Markets in fiscal year 2006.(5)
    
    Represents salary and benefits for personal accountant ($116,261) and executive
assistant ($75,089), imputed income relating to family members accompanying Mr. Goff on trips on
the Company airplane ($15,464), 401(k) matching contributions ($15,400) and club membership fees
($12,111).(6)
    
    Represents 401(k) matching contributions ($15,000) as well as dividends allocated to
Mr. Crenshaw for DIUs that are treated as invested in the Company or specified public mutual funds
made available to the holders by the General Partner, club membership fees and a stipend paid by
the Company for financial planning services.(7)
    
    Represents 401(k) matching contributions ($15,400), club membership fees ($14,322),
as well as personal use of Company airplane.(8)
    
    Represents dividends allocated to Ms. Mody for dividend incentive units (DIUs)
($17,291) that are treated as invested in the Company or specified public mutual funds made
available to the holders by the General Partner, 401(k) matching contributions ($15,400) as well as
club membership fees, a stipend paid by the Company for financial
planning services and imputed income relating to family members
accompanying Ms. Mody on trips on the Company airplane.(9)
    
    Represents club membership fees ($17,672), 401(k) matching contributions
($15,000) and a stipend paid by the Company for financial planning services. 11




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Grants of Plan-Based Awards Table
  All
    
    
    
    
    
    GrantOther
    
    
    
    
    
    DateNumber
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    Stock
    
    All Other
    
    
    
    Fairof Non-
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    Awards:
    
    Option
    
    
    
    ValueEquity
    
    Estimated Future
    
    Estimated Future
    
    Number
    
    Awards:
    
    Exercise
    
    ofIncentive
    
    Payments Under
    
    Payouts Under
    
    of
    
    Number of
    
    or Base
    
    StockPlan
    
    Non-Equity Incentive
    
    Equity Plan
    
    Shares
    
    Securities
    
    Price of
    
    andUnits
    
    Plan Awards
    
    Incentive Awards
    
    of Stock
    
    Underlying
    
    Option
    
    OptionName
    
    Grant Date
    
    Approval Date
    
    Granted
    
    Threshold
    
    Target
    
    Maximum (1)
    
    Threshold
    
    Target
    
    Maximum
    
    or Units
    
    Options
    
    Awards
    
    AwardsJohn C. GoffJerry R. Crenshaw,
Jr. (2)
    
    2/17/06
    
    
    
    
    
    
    
    
    
    $
    401,500Dennis H. Alberts
    
    2/17/06
    
    
    
    
    
    
    
    
    
    $
    750,000Jane E. Mody (3)
    
    2/17/06
    
    
    
    
    
    
    
    
    
    $
    423,500John L. Zogg, Jr.
    
    2/17/06
    
    
    
    
    
    
    
    
    
    $
    385,000
 
 (1)
    
    This column represents the maximum amounts that could have been paid for fiscal year
2006 under our Bonus Plan. Under the Bonus Plan, only the Corporate component has threshold and
target performance levels and thus, only the maximum bonus potential under the Bonus Plan for each
named executive officer is included in the table. The amounts set forth under the Non-Equity
Incentive Plan Compensation column of the Summary Compensation Table represent the actual bonuses
paid under the Bonus Plan in February 2007 for fiscal year 2006 performance. See Compensation
Discussion and Analysis for a detailed description of the Bonus Plan.(2)
    
    Resigned as an executive officer effective as of March 29, 2007.(3)
    
    Served as Managing Director, Capital Markets in fiscal year 2006. Outstanding Equity Awards Table
  Option Awards
    
    Stock AwardsEquity
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    Equity
    
    EquityIncentive
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    Incentive
    
    Incentive PlanPlan
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    Plan
    
    Awards:Number of
    
    Number of
    
    Awards:
    
    
    
    
    
    
    
    
    
    
    
    
    
    Market
    
    Awards:
    
    Market orSecurities
    
    Securities
    
    Number of
    
    
    
    
    
    
    
    
    
    Number of
    
    Value of
    
    Number of
    
    Payout ValueUnderlying
    
    Underlying
    
    Securities
    
    
    
    
    
    
    
    
    
    Shares of
    
    Shares of
    
    Unearned
    
    of UnearnedUnexercised
    
    Unexercised
    
    Underlying
    
    Option
    
    Option
    
    Stock That
    
    Stock That
    
    Shares That
    
    Shares ThatOptions
    
    Options
    
    Unearned
    
    Exercise
    
    Expiration
    
    Have Not
    
    Have Not
    
    Have Not
    
    Have NotName
    
    Exercisable (1)
    
    Unexercisable (1)(2)
    
    Options
    
    Price
    
    Date
    
    Vested
    
    Vested (3)
    
    Vested
    
    Vested (3)John C. Goff
    
    
    400,000
    
    
    
    
    
    
    
    
    
    
    $
    15.8125
    
    
    
    11/4/09
    
    
    
    100,000
    (2)
    
    $
    1,975,000
    
    
    
    312,000
    (4)
    
    $
    7,098,000200,000
    
    
    
    
    
    
    
    
    
    
    $
    15.8125
    
    
    
    11/4/09
    
    
    
    
    
    
    
    
    
    
    
    480,000
    (5)
    
    $
    10,560,000442,858
    
    
    
    
    
    
    
    
    
    
    $
    17.5100
    
    
    
    2/18/121,957,142
    
    
    
    600,000
    
    
    
    
    
    
    $
    17.5100
    
    
    
    2/18/12Jerry R. Crenshaw, Jr.(6)
    
    
    165,000
    
    
    
    
    
    
    
    
    
    
    $
    15.8125
    
    
    
    11/4/09
    
    
    
    
    
    
    
    
    
    
    
    60,000
    (4)
    
    $
    1,365,000160,000
    
    
    
    13,865
    
    
    
    
    
    
    $
    17.5100
    
    
    
    2/18/12
    
    
    
    
    
    
    
    
    
    
    
    80,000
    (5)
    
    $
    1,760,000Dennis H. Alberts
    
    
    120,000
    
    
    
    
    
    
    
    
    
    
    $
    18.0625
    
    
    
    4/16/10
    
    
    
    
    
    
    
    
    
    
    
    200,000
    (4)
    
    $
    4,550,00083,400
    
    
    
    
    
    
    
    
    
    
    $
    21.8400
    
    
    
    3/4/11
    
    
    
    
    
    
    
    
    
    
    
    320,000
    (5)
    
    $
    7,040,000400,000
    
    
    
    100,000
    
    
    
    
    
    
    $
    17.5100
    
    
    
    2/18/12Jane E. Mody (7)
    
    
    240,000
    
    
    
    60,000
    
    
    
    
    
    
    $
    17.5100
    
    
    
    2/18/12
    
    
    
    
    
    
    
    
    
    
    
    66,000
    (4)
    
    $
    1,501,50080,000
    (5)
    
    $
    1,760,000John L. Zogg, Jr.
    
    
    75,000
    
    
    
    
    
    
    
    
    
    
    $
    15.8125
    
    
    
    11/4/09
    
    
    
    
    
    
    
    
    
    
    
    60,000
    (4)
    
    $
    1,365,000130,468
    
    
    
    
    
    
    
    
    
    
    $
    17.5100
    
    
    
    2/18/12
    
    
    
    
    
    
    
    
    
    
    
    80,000
    (5)
    
    $
    1,760,000
 
 (1)
    
    Includes Unit options and Common Share options. For Unit options, the number
of securities shown in the column represents the number of Common Shares the Units to be received
upon exercise of Unit options would be exchangeable into 12




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(on the basis of two Common Shares for each Unit).(2)
    
    Option awards became exercisable and stock award vested on February 19, 2007.(3)
    
    Based on the closing price of the Common Shares on December 29, 2006 (the last
trading day of the fiscal year) on the New York Stock Exchange of $19.75. Includes the value of
all regular quarterly distributions that have accrued on unvested restricted Units that become
payable upon vesting (assuming vesting as of December 31, 2006).(4)
    
    Granted effective December 1, 2004 under the LTI Plan and the partnership
agreement of the Operating Partnership. Half of the restricted Units vest when the average closing
price of the Companys Common Shares on the New York Stock Exchange for the immediately preceding
40 trading days equals or exceeds $22.50 and the remaining restricted Units vest when the average
closing price of the Companys Common Shares on the New York Stock Exchange for the immediately
preceding 40 trading days equals or exceeds $24.00. The Performance Plan also gives discretion to
the General Partner to establish one or more alternative objective annual performance targets for
the Company. Any restricted Unit that is not vested on or prior to June 30, 2010 will be forfeited.
Each vested restricted Unit will be exchangeable for cash equal to the value of two Common Shares
based on the closing price of the Common Shares on the date of exchange, and subject to a six-month
holding period following vesting, unless, prior to the date of the exchange, the Company requests
and obtains shareholder approval authorizing it, in its discretion, to deliver instead two Common
Shares in exchange for each such restricted Unit. Regular quarterly distributions accrue on
unvested restricted Units and are payable upon vesting of the restricted Units. The number of
securities shown in the column represents the number of Common Shares the restricted Units would be
exchangeable into if shareholder approval was obtained.(5)
    
    Granted effective May 16, 2005 under the Performance Plan. The restricted units vest
in 25% increments when the average closing price of Crescent Common Shares on the New York Stock
Exchange for the immediately preceding 40 trading days equals or exceeds $22.50, $24.00, $25.50 and
$27.00. The Performance Plan also gives discretion to the General Partner to establish one or more
alternative objective annual performance targets for the Company. Any restricted Unit that is not
vested on or prior to June 30, 2010 will be forfeited. Each vested restricted Unit will be
exchangeable for cash equal to the value of two Common Shares based on the closing price of the
Common Shares on the date of exchange, and subject to a six-month holding period following vesting,
unless, prior to the date of the exchange, the Company requests and obtains shareholder approval
authorizing it, in its discretion, to deliver instead two Common Shares in exchange for each such
restricted Unit. Regular quarterly distributions accrue on unvested restricted Units and are
payable upon vesting of the restricted Units. The number of securities shown in the column
represents the number of Common Shares the restricted Units would be exchangeable into if
shareholder approval was obtained.(6)
    
    Resigned as an executive officer effective as of March 29, 2007.(7)
    
    Served as Managing Director, Capital Markets in fiscal year 2006. Option Exercises and Stock Vested Table
  Option Awards
    
    Stock AwardsNumber of Shares
    
    
    
    
    
    Number of SharesAcquired on
    
    Value Realized on
    
    Acquired on Vesting
    
    Value Realized onName
    
    Exercise (1)
    
    Exercise
    
    (2)
    
    Vesting (3)John C. Goff
    
    
    580,244
    
    
    $
    1,101,013
    
    
    
    276,000
    
    
    $
    6,226,260Jerry R. Crenshaw, Jr. (4)
    
    
    
    
    
    
    
    
    
    
    50,000
    
    
    $
    1,129,250Dennis H. Alberts
    
    
    
    
    
    
    
    
    
    
    180,000
    
    
    $
    4,059,300Jane E. Mody (5)
    
    
    
    
    
    
    
    
    
    
    53,000
    
    
    $
    1,197,905John L. Zogg, Jr.
    
    
    
    
    
    
    
    
    
    
    50,000
    
    
    $
    1,129,250
 
 (1)
    
    The number of securities shown in the column represents the number of Common Shares
the Units received upon exercise of Unit options were exchanged for (on the basis of two Common
Shares for each Unit).(2)
    
    The number of securities shown in the column represents the number of Common Shares
the Units received upon vesting of restricted Units granted under the LTI Plan and the Performance
Plan are exchangeable into (on the basis of two Common 13




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Shares for each Unit). However, each vested
restricted Unit is currently exchangeable for cash equal to the value of two Common Shares based on
the closing price of the Common Shares on the date of exchange, until such time, prior to the date
of the exchange, the Company requests and obtains shareholder approval authorizing it, in its
discretion, to deliver instead two Common Shares in exchange for each such restricted Unit.(3)
    
    Based on the closing price of the Common Shares on March 10, 2006 (the date of
vesting) on the New York Stock Exchange of $21.01. Includes the value of all regular quarterly
distributions that have accrued on unvested restricted Units that become payable upon vesting.(4)
    
    Resigned as an executive officer effective as of March 29, 2007.(5)
    
    Served as Managing Director, Capital Markets in fiscal year 2006. Potential Payments Upon Termination or Change of Control
   LTI Plan and Performance Plan.
 
    
    in the event of a Company capital transaction unless (A) there is a surviving
entity and (B) the executive receives the right to require the surviving entity to
exchange the Units for common equity of the surviving entity (or, at the surviving
entitys election, cash) (exchange rights) and any such equity shall have rights to
distributions upon vesting and special tax loss allocations on expiration or forfeiture
that are substantially the same as the rights of the Units (with appropriate
adjustments to reflect the transaction); or
    
    in the event of a Partnership capital transaction unless (A) there is a surviving
entity and (B) the surviving entity provides or agrees to provide replacement Units
that contains tax allocation, book-up and other provisions enabling the executive to
have exchange rights, distributions upon vesting, and special tax loss allocations on
expiration or forfeiture that are substantially the same terms as the rights of the
Units (with appropriate adjustments to reflect the transaction).
    
    
    an agreement to merge, consolidate or otherwise combine with or into or be acquired
by another person, regardless of whether the Company is the surviving entity, or sell
all or substantially all of its assets,
    
    any plan or proposal for the reclassification, recapitalization or exchange of outstanding Common Shares, or
    
    any plan or proposal for the liquidation or dissolution of the Company.
  14




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##### Table of Contents




    
    an agreement to merge, consolidate or otherwise combine with or into or be acquired
by another person, regardless of whether the Operating Partnership is the surviving
entity, or sell all or substantially all of its assets, or
    
    any plan or proposal for the liquidation or dissolution of the Operating
Partnership.
   
    
    if prior to the acquisition of, or offer to acquire, 15% or more of the voting
securities of the Company, the full Board has adopted by not less than two-thirds vote
a resolution specifically approving such acquisition or offer; or
    
    from (A) a transfer of the Companys voting securities by Richard E. Rainwater
(Rainwater) to (i) a member of Rainwaters immediate family (within the meaning of
Rule 16a-1(e) of the Exchange Act) either during Rainwaters lifetime or by will or the
laws of descent and distribution; (ii) any trust as to which Rainwater or a member (or
members) of his immediate family (within the meaning of Rule 16a-1(e) of the Exchange
Act) is the beneficiary; (iii) any trust as to which Rainwater is the settlor with sole
power to revoke; (iv) any entity over which Rainwater has the power, directly or
indirectly, to direct or cause the direction of the management and policies of the
entity, whether through the ownership of voting securities, by contract or otherwise;
or (v) any charitable trust, foundation or corporation under Section 501(c)(3) of the
Code that is funded by Rainwater, or any corporation or other entity all the voting
securities of which are owned by such a charitable trust, foundation or corporation; or
(B) the acquisition of voting securities of the Company by either (i) Rainwater or (ii)
a person, trust or other entity described in the foregoing clauses (A)(i)-(v) of this
subsection.
    
    
    an act or acts of or at the direction of the executive involving a felony, fraud,
willful misconduct, commission of any act that causes or reasonably may be expected to
cause substantial injury to the Operating Partnership, the General Partner or the
Company,
    
    commission of any act that is against the material best interests of the Operating
Partnership, the General Partner or the Company,
 15




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##### Table of Contents




    
    any uncured breach of any of executives material duties under any written
employment or other personal services contract with the Operating Partnership or its
affiliates, or
    
    any uncured breach of any material provision of any written non-competition
agreement between the Operating Partnership or any of its affiliates and the executive.
  Value Realized Under LTI Plan and Performance Plan Upon Vesting Change of Control Event
 Name
    
    
    
    
    
    Total (1)John C. Goff
    
    
    
    
    
    $
    17,658,000Jerry R. Crenshaw, Jr.
    
    
    
    
    
    $
    3,125,000Dennis H. Alberts
    
    
    
    
    
    $
    11,590,000Jane E. Mody
    
    
    
    
    
    $
    3,261,500John L. Zogg, Jr.
    
    
    
    
    
    $
    3,125,000
 
 (1)
    
    Each vested restricted Unit will be exchangeable for cash equal to the value of two
Common Shares based on the closing price of the Common Shares on the date of exchange, and
subject to a six-month holding period following vesting, unless, prior to the date of the
exchange, the Company requests and obtains shareholder approval authorizing it, in its
discretion, to deliver instead two Common Shares in exchange for each such restricted Unit.
Based on the closing price of the Common Shares on December 29, 2006 (the last trading day of
the fiscal year) on the New York Stock Exchange of $19.75. Includes the value of all regular
quarterly distributions that have accrued on unvested restricted Units that become payable
upon vesting. 2002 Unit Options Agreements
   
    
    a reduction in the amount of executives aggregate cash compensation (including base
salary and any bonus) payable within any twelve-month period following a change in
control below the amount of such aggregate cash compensation paid to, or accrued by the
General Partner with respect to, the executive in the twelve-month period immediately
preceding the change in control;
    
    the assignment of executive to any employment status other than a position
reasonably equivalent to the position the executive held by the executive immediately
before the change in control and having duties comparable to those exercised by the
executive immediately before the change in control, or
    
    a geographical relocation or attempted relocation of the executive to an office more
than fifty (50) miles distant from Fort Worth, Texas, without the executives consent.
 16




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##### Table of Contents




    
    if prior to the acquisition of, or offer to acquire, 15% or more of the voting
securities of the Company, the full Board has adopted by not less than two-thirds vote
a resolution specifically approving such acquisition or offer; or
    
    from (A) a transfer of the Companys voting securities by Rainwater to (i) a member
of Rainwaters immediate family (within the meaning of Rule 16a-1(e) of the Exchange
Act) either during Rainwaters lifetime or by will or the laws of descent and
distribution; (ii) any trust as to which Rainwater or a member (or members) of his
immediate family (within the meaning of Rule 16a-1(e) of the Exchange Act) is the
beneficiary; (iii) any trust as to which Rainwater is the settlor with sole power to
revoke; (iv) any entity over which Rainwater has the power, directly or indirectly, to
direct or cause the direction of the management and policies of the entity, whether
through the ownership of voting securities, by contract or otherwise; or (v) any
charitable trust, foundation or corporation under Section 501(c)(3) of the Code that is
funded by Rainwater, or any corporation or other entity all the voting securities of
which are owned by such a charitable trust, foundation or corporation; or (B) the
acquisition of voting securities of the Company by either (i) Rainwater or (ii) a
person, trust or other entity described in the foregoing clauses (A)(i)-(v).
   
    
    an act, acts or omission involving a felony, fraud, willful misconduct, or gross
negligence,
    
    commission of any act that causes or reasonably might be expected to cause
substantial injury to the Operating Partnership or the General Partner or is against
the material best interests of the Operating Partnership of the General Partner, or
    
    an uncured breach of any material provision of any noncompetition agreement to which
the executive is a party.
  Value Realized under 2002 Unit Option Agreements Upon Vesting Change of Control Event,
Termination for Good ReasonWithin 24 Months of Non-Vesting Change of Control Event or Without Just
Cause
 Name
    
    
    
    
    
    Total (1)John C. Goff
    
    
    
    
    
    $
    1,344,000Jerry R. Crenshaw, Jr.
    
    
    
    
    
    $
    31,058Dennis H. Alberts
    
    
    
    
    
    $
    224,000Jane E. Mody
    
    
    
    
    
    $
    134,400
 
 (1)
    
    The Unit options became exercisable on February 19, 2007. Units issued upon
exercise of options issued under the 2002 Unit Option Agreements are exchangeable for cash
equal to the value of two Common Shares based on the closing price of the Common Shares on the
date of exchange, unless, prior to the date of the exchange, the Company requests and obtains
shareholder approval authorizing it, in its discretion, to deliver instead two Common Shares
in exchange for each such restricted Unit. Based on the closing price of the Common Shares on
December 29, 2006 (the last trading day of the fiscal year) on the New York Stock Exchange of
$19.75. 17




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##### Table of Contents



1995 Stock Incentive Plan and Goff Restricted Share Agreement
   
    
    if prior to the acquisition of, or offer to acquire, 15% or more of the voting
securities of the Company, the full Board has adopted by not less than two-thirds vote
a resolution specifically approving such acquisition or offer; or
    
    from (A) a transfer of the Companys voting securities by Rainwater to (i) a member
of Rainwaters immediate family (within the meaning of Rule 16a-1(e) of the Exchange
Act) either during Rainwaters lifetime or by will or the laws of descent and
distribution; (ii) any trust as to which Rainwater or a member (or members) of his
immediate family (within the meaning of Rule 16a-1(e) of the Exchange Act) is the
beneficiary; (iii) any trust as to which Rainwater is the settlor with sole power to
revoke; (iv) any entity over which Rainwater has the power, directly or indirectly, to
direct or cause the direction of the management and policies of the entity, whether
through the ownership of voting securities, by contract or otherwise; or (v) any
charitable trust, foundation or corporation under Section 501(c)(3) of the Code that is
funded by Rainwater, or any corporation or other entity all the voting securities of
which are owned by such a charitable trust, foundation or corporation; or (B) the
acquisition of voting securities of the Company by either (i) Rainwater or (ii) a
person, trust or other entity described in the foregoing clauses (A)(i)-(v) of this
subsection.
    Agreements Not to Compete
  18




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##### Table of Contents



Trust Manager Compensation
  Change in PensionValue andNonqualifiedNon-Equity
    
    DeferredFees Earned
    
    
    
    
    
    
    
    
    
    Incentive Plan
    
    Compensation
    
    All OtherName
    
    in Cash (1)
    
    Stock Awards
    
    Option Awards (2)
    
    Compensation
    
    Earnings
    
    Compensation
    
    TotalRichard E. Rainwater
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    Anthony M. Frank
    
    $
    133,000
    
    
    
    
    
    
    $
    39,333
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    $
    172,333William F. Quinn
    
    $
    138,000
    
    
    
    
    
    
    $
    15,990
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    $
    153,990Paul E. Rowsey, III
    
    $
    152,500
    
    
    
    
    
    
    $
    15,990
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    $
    168,490Robert W. Stallings
    
    $
    119,500
    
    
    
    
    
    
    $
    13,043
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    $
    132,543Terry N. Worrell
    
    $
    142,000
    
    
    
    
    
    
    $
    13,043
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    $
    155,043
 
 (1)
    
    Excludes fees earned by Messrs. Frank, Quinn, Rowsey and Worrell for 2006 service
on the Special Committee of the Board of Trust Managers formed in July 2006, as described in greater
detail below, because the Board of Trust Managers has not yet determined the amount of fees for
such service.(2)
    
    Amounts in this column represent the dollar amount recognized for financial
statement reporting purposes with respect to fiscal year 2006 in accordance with FAS 123R, and thus
include amounts from awards granted prior to 2006. Our calculations in accordance with FAS 123R
were made with the assumptions and other criteria, as set forth in note 16 to our consolidated
financial statements for the year ended December 31, 2006 set forth in our Annual Report on Form
10-K for the year ended December 31, 2006.  AmountAnnual RetainersBoard of Trust Managers
    
    $
    100,000Audit Committee Chair
    
    
    10,000Executive Compensation Committee Chair
    
    
    5,000Governance Committee Chair
    
    
    5,000Meeting FeesAudit Committee Chair
    
    
    2,000Special Litigation Committee Chair (for meetings on or after July 27, 2006)
    
    
    2,000Special Litigation Committee Chair (for meetings before July 27, 2006)
    
    
    1,500Executive Compensation Committee Chair
    
    
    1,500Governance Committee Chair
    
    
    1,500Audit Committee Member
    
    
    1,500Special Litigation Committee Member (for meetings on or after July 27, 2006)
    
    
    1,500Special Litigation Committee Member (for meetings before July 27, 2006)
    
    
    1,000
 19




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##### Table of Contents



AmountExecutive Compensation Committee Member
    
    
    1,000Governance Committee Member
    
    
    1,000
    Committee Interlocks and Insider Participation
  REPORT OF THE EXECUTIVE COMPENSATION COMMITTEE
 The information contained in this report shall not be deemed to be soliciting material or to
be filed with the SEC, nor shall such information be incorporated by reference into any previous
or future filings under the Securities Act of 1933 or the Securities Exchange Act of 1934 except to
the extent that we incorporated it by specific reference.
  EXECUTIVE COMPENSATION COMMITTEE
 
 20




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##### Table of Contents



Item 12. Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters
 Equity Compensation Plan Information
  Number of securitiesNumber of
    
    
    
    
    
    remaining available forsecurities to be
    
    
    
    
    
    future issuance under equityissued upon
    
    Weighted-average
    
    compensation plansexercise of
    
    exercise price of
    
    (excluding securities to beoutstanding
    
    outstanding
    
    issued upon exercise ofoptions, warrants
    
    options, warrants
    
    outstanding options,Plan category
    
    and rights (2)
    
    and rights
    
    warrants and rights)Equity compensation
plans approved by
security holders
(1)
    
    
    5,205,808
    
    
    $
    19.40
    
    
    
    0Equity compensation
plans not approved
by security holders
(3)
    
    
    11,225,511
    
    
    
    19.84
    
    
    
    409,000Total
    
    
    16,431,319
    
    
    
    19.70
    
    
    
    409,000
    (4)
 
 (1)
    
    Amount includes 4,562,950 Common Shares that may be issued following the exercise of
Stock Options granted under the 1995 Crescent Real Estate Equities Company Stock Incentive Plan, as
amended (the 1995 Plan). Amount also includes 642,858 Common Shares that may be issued
following (i) exercise of (the Plan Unit Options) granted under the 1996 Crescent Real
Estate Equities Limited Partnership Unit Incentive Plan, as amended (the Unit Plan) to
purchase Units on a one-for-one basis and (ii) the subsequent exchange of such Units for
Common Shares on the basis of two Common Shares for each Unit (assuming the Company elects to
issue Common Shares rather than pay cash upon such exchange).(2)
    
    Excludes restricted Common Share grants and Common Shares issued to trust managers
in lieu of board fees. No exercise price is required to be paid upon vesting of restricted
shares.(3)
    
    Amount represents the number of Common Shares that may be issued following (i)
exercise of options granted pursuant to the 1995 Crescent Real Estate Equities Limited
Partnership Unit Incentive Plan and individual agreements to purchase Units and the subsequent
exchange of such Units for Common Shares on the basis of two Common Shares for each Unit
(assuming the Company elects to issue Common Shares rather than pay cash upon such exchange)
and (ii) vesting of restricted Units issued under the LTI Plan and the Performance Plan and
(assuming the Company requests and obtains shareholder approval) the subsequent exchange of
such Units for Common Shares on the basis of two Common Shares for each Unit (assuming the
Company elects to issue Common Shares rather than pay cash upon such exchange).(4)
    
    Amount represents securities remaining available for issuance under the LTI Plan and the Performance Plan. There are no such remaining securities under the 1995 Crescent Real Estate Equities
Limited Partnership Unit Incentive Plan or the individual agreements
described in footnote (3) above. Share Ownership Table
  
    
    each shareholder who beneficially owns more than 5% of the Common Shares,
    
    each trust manager,
    
    our named executive officers, and
    
    the trust managers and executive officers of the Company and the General Partner as a group.
 (1)
 Number ofCommon Shares
    
    Percent ofName and Address of Beneficial Owner(2)
    
    (3)(4)(5)(6)
    
    Common Shares(7)Richard E. Rainwater
    
    
    16,621,283
    (8)
    
    
    14.5
    %John C. Goff
    
    
    4,842,099
    (9)
    
    
    4.6
    %
 21




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##### Table of Contents



Number ofCommon Shares
    
    Percent ofName and Address of Beneficial Owner(2)
    
    (3)(4)(5)(6)
    
    Common Shares(7)Dennis H. Alberts
    
    
    350,270
    
    
    
    *Anthony M. Frank
    
    
    145,827
    
    
    
    *William F. Quinn
    
    
    163,019
    
    
    
    *Paul E. Rowsey, III
    
    
    141,427
    
    
    
    *Robert W. Stallings
    
    
    96,500
    (10)
    
    
    *Terry N. Worrell
    
    
    89,200
    (11)
    
    
    *Jerry R. Crenshaw, Jr.
    
    
    300,166
    (12)
    
    
    *Jane E. Mody
    
    
    9,532
    (13)
    
    
    *John L. Zogg, Jr.
    
    
    220,635
    
    
    
    *BlackRock, Inc.
40 East 52nd Street
New York, NY 10022
    
    
    6,324,758
    (14)
    
    
    6.5
    %Capital Research and Management Company
333 South Hope Street
Los Angeles, CA 90071
    
    
    6,320,360
    (15)
    
    
    6.5
    %The Vanguard Group, Inc.
100 Vanguard Blvd.
Malvern, PA 19355
    
    
    5,754,747
    (16)
    
    
    5.9
    %Trust Managers and Executive Officers as a Group (16 persons)
    
    
    23,759,466
    (8)(9) (10)(11)(12)(13)
    
    
    21.2
    %
 
 *
    
    Less than 1%(1)
    
    All information is as of April 25, 2007 (the Record Date), unless otherwise
indicated. As of the Record Date, there were 102,821,311 Common Shares issued and
outstanding. The number of Common Shares beneficially owned is reported on the basis of
regulations of the SEC governing the determination of beneficial ownership of securities.
Accordingly, the number of Common Shares a person beneficially owns includes: 
    
    the number of Common Shares that such person owns;
    
    the number of Common Shares that such person has the right to acquire within 60 days
of the Record Date upon the exercise of options (Stock Options) granted pursuant to
the 1994 Plan or the 1995 Plan,
    
    the number of Common Shares that may be issued within 60 days of the Record Date upon
exchange of Units that such person owns for Common Shares, with such exchange made on
the basis of two Common Shares for each Unit exchanged (assuming the Company elects to
issue Common Shares rather than pay cash upon such exchange),
    
    the number of Common Shares that may be issued within 60 days of the Record Date upon
exercise of Plan Unit Options granted under the Unit Plan to purchase Units and the
subsequent exchange of such Units for Common Shares, with such exchange made on the
basis of two Common Shares for each Unit exchanged (assuming the Company elects to issue
Common Shares rather than pay cash upon such exchange).
 (2)
    
    The address of each beneficial owner is 777 Main Street, Suite 2100, Fort Worth,
Texas 76102.(3)
    
    The number of Common Shares the following persons beneficially own includes the
number of Common Shares indicated due to the ownership of unexercised Stock Options, as
follows: John C. Goff  400,000; Dennis H. Alberts  203,400; Anthony M. Frank 
106,400; William F. Quinn  109,200; Paul E. Rowsey, III  109,200; Robert W. Stallings
 39,200; Terry N. Worrell  39,200; Jerry R. Crenshaw, Jr.  165,000;
John L. Zogg, Jr.  75,000; and Trust Managers and
Executive Officers as a Group  1,813,490.(4)
    
    The number of Common Shares the following persons beneficially own includes the
number of Common Shares owned indirectly through participation in the General Partners
401(k) Plan as of March 31, 2007, as follows: John C. Goff  19,801; Jerry R. Crenshaw,
Jr.  7,474; John L. Zogg  88; and Trust Managers and Executive
Officers as a Group  52,307.(5)
    
    The number of Common Shares the following persons beneficially own includes the
number of Common Shares that may be issued upon exchange of Units that such person owns, as
follows: Richard E. Rainwater  11,447,334; John C. Goff  1,812,970; and Trust Managers
and Executive Officers as a Group  13,260,304.(6)
    
    The number of Common Shares the following persons beneficially own includes the
number of Common Shares owned through participation in the General Partners Employee Stock
Purchase Plan as of March 31,2007, as follows: John C. Goff  2,415; John L. Zogg, Jr. 
647; and Trust Managers and Executive Officers as a Group  3,998.(7)
    
    The percentage of Common Shares that a person listed in the Beneficial Ownership
table beneficially owns assumes that (i) as to that person, all Units are exchanged for
Common Shares, all Stock Options exercisable within 60 days of the Record Date are
exercised and all Plan Unit Options exercisable within 60 days of the Record Date are
exercised and the Units so acquired are subsequently exchanged for Common Shares, and (ii)
as to all other persons, no Units are exchanged for Common Shares, no Series A Preferred
Shares are converted into Common Shares, and no Stock Options or Plan Unit Options are
exercised.(8)
    
    The number of Common Shares that Mr. Rainwater beneficially owns includes
744,704 Common Shares that Darla Moore, Mr. Rainwaters spouse, beneficially owns and
519,610 Common Shares that may be issued upon exchange of Units that Ms. Moore beneficially
owns. Mr. Rainwater disclaims beneficial ownership of these Common Shares. In addition,
the number of Common Shares that Mr. Rainwater beneficially owns includes 3,608,238 Common
Shares that Mr. Rainwater owns indirectly and 6,320,468 Common Shares that may be issued
upon exchange of Units that Mr. Rainwater owns indirectly, including (i) 12,525 Common Shares owned by
Rainwater, Inc., a Texas corporation, of which Mr.
 22




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##### Table of Contents



Rainwater is a director and the sole owner, and 49,506 Common Shares that may be issued upon exchange of Units owned by Rainwater,
Inc., (ii) 10,586 Common Shares owned by Office Towers LLC, a Nevada limited liability
company, of which Mr. Rainwater and Rainwater, Inc. own an aggregate 100% interest, and
6,270,962 Common Shares that may be issued upon exchange of Units owned by Office Towers LLC,
(iii) 2,935,127 Common Shares owned by the Richard E. Rainwater 1995 Charitable Remainder
Unitrust No. 1, of which Mr. Rainwater is the settlor and has the power to remove the trustee
and designate a successor, including himself, and (iv) 650,000 Common Shares owned by the
Richard E. Rainwater Charitable Remainder Unitrust No. 3, of which Mr. Rainwater is the
settlor and has the power to remove the trustee and designate a successor, including himself.(9)
    
    The number of Common Shares that Mr. Goff beneficially owns includes (i) 152,560
Common Shares that may be issued upon exchange of Units that Goff Family, L.P., a Delaware
limited partnership, owns, and (ii) 642,858 Common Shares that may be issued upon exchange
of Units due to the vesting of Plan Unit Options. Mr. Goff disclaims beneficial ownership
of the Common Shares that may be issued upon exchange of Units that Goff Family, L.P. owns
in excess of his pecuniary interest in such Units.(10)
    
    The number of Common Shares that Mr. Stallings beneficially owns includes 13,500
Common Shares in an IRA account which is owned by Linda E. Stallings, Mr. Stallings
spouse. Mr. Stallings disclaims beneficial ownership of such Common Shares.(11)
    
    The number of Common Shares that Mr. Worrell beneficially owns includes 50,000
Common Shares in a joint brokerage account of which Mr. Worrell and his spouse, Sharon
Worrell, share voting and investment power.(12)
    
    Resigned effective as of March 29, 2007. The number of Common Shares that Mr.
Crenshaw beneficially owns includes 8,092 Common Shares in joint brokerage account of which
Mr. Crenshaw and his spouse, Lori Crenshaw, share voting and investment power.(13)
    
    Served as Managing Director, Capital Markets in fiscal year 2006. The number of
Common Shares that Ms. Mody beneficially owns includes 9,532 Common Shares owned by the
Mody Family Living Trust, of which Ms. Mody and her spouse Haji Mody are the trustees and
beneficiaries.(14)
    
    BlackRock, Inc. (Black Rock) filed a Schedule 13G, as of February 14, 2007,
reporting that BlackRock beneficially owns and has shared voting and dispositive power over
6,324,758 Common Shares. All information presented above relating to BlackRock is based
solely on the Schedule 13G.(15)
    
    Capital Research and Management Company (Capital Research) filed a Schedule
13G, as of February 9, 2007, reporting that Capital Research beneficially owns and has sole
voting over 1,400,000 Common Shares and sole dispositive power over 6,320,360 Common
Shares. All information presented above relating to Capital Research is based solely on
the Schedule 13G.(16)
    
    The Vanguard Group, Inc. (Vanguard) filed a Schedule 13G, as of February 14,
2006, reporting that Vanguard beneficially owns and has sole voting power over 135,972
Common Shares and shared dispositive power over 5,754,747 Common Shares. All information
presented above relating to Vanguard is based solely on the Schedule 13G. 
 Item 13. Certain Relationships and Related Transactions, and Trust Manager Independence
 Certain Relationships and Related Person Transactions
  Loans to Trust Managers and Executive Officers for Exercise of Options and Plan Unit Options
  Number ofAggregate
    
    Common ShareEffective Dates
    
    Amount
    
    EquivalentsName
    
    Title
    
    of Loan
    
    of Loan
    
    PurchasedAnthony M. Frank
    
    Trust Manager
    
    1996-1999
    
    $
    398,889
    
    
    
    26,200John C. Goff (1)
    
    Vice Chairman and Chief Executive Officer
    
    1999
    
    $
    26,272,631
    
    
    
    1,588,060
 23




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##### Table of Contents



Number ofAggregate
    
    Common ShareEffective Dates
    
    Amount
    
    EquivalentsName
    
    Title
    
    of Loan
    
    of Loan
    
    PurchasedDavid M. Dean
    
    Managing Director, Law and Secretary
    
    1999-2002
    
    $
    2,538,777
    
    
    
    147,300Theresa E. Black(2)
    
    Vice President, Tax
    
    1999-2002
    
    $
    524,857
    
    
    
    33,000Jerry R. Crenshaw, Jr.
    
    Former Managing Director and Chief Financial Officer
    
    1999-2002
    
    $
    1,875,237
    
    
    
    118,800John L. Zogg, Jr. (3)
    
    Managing Director, Asset Management
    
    2000-2001
    
    $
    2,570,432
    
    
    
    144,900Dennis H. Alberts
    
    President, Chief Operating Officer and Trust Manager
    
    2001
    
    $
    1,083,150
    
    
    
    60,000
 
 (1)
    
    Mr. Goffs loan is secured by 700,000 Common Shares
and 1,500,000 Unit Options (3,000,000 Common Share equivalents)
that Mr. Goff owns. Mr. Goff has assigned the dividends that he will receive on 300,000 of
the 700,000 Common Shares to payment of future interest due on his loan. In addition,
Mr. Goff is required to use 60% of the net proceeds from the sale of any of such 300,000
Common Shares or the 1,500,000 Units underlying the 1,500,000 Unit Options to pay down the
amount of his loan.(2)
    
    Although Ms. Black is not an executive officer of the Company, she is the spouse
of David M. Dean.(3)
    
    As a result of certain stock sales and principal repayments, the aggregate amount
outstanding as of March 24, 2006 is $2,570,431. Mr. Zoggs loans are currently secured by
an aggregate of 144,900 Common Shares that Mr. Zogg owns. DBL Holdings, Inc.
   Canyon Ranch
  24




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##### Table of Contents



Related Person Transaction Approval Policies
 General .
    Purchase of Company-Owned Real Estate Policy
 Board of Trust Managers
 Corporate Governance www.crescent.com
 Independence and Composition
 25




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
    
    A trust manager who is an employee, or whose immediate family member is an executive
officer, of the Company is not independent until three years after the end of such
employment relationship;
    
    A trust manager who receives, or whose immediate family member receives, more than
$100,000 per year in direct compensation from the Company, other than board and
committee fees and pension or other forms of deferred compensation for prior service
(provided such compensation is not contingent in any way on continued service), is not
independent until three years after he or she ceases to receive more than $100,000 per
year in such compensation;
    
    A trust manager is not independent if (A) the director or an immediate family member
is a current partner of a firm that is the Companys internal or external auditor; (B)
the trust manager is a current employee of such a firm; (C) the trust manager has an
immediate family member who is a current employee of such a firm and who participates
in the firms audit, assurance or tax compliance (but not tax planning) practice; or
(D) the trust manager or an immediate family member was within the last three years
(but is no longer) a partner or employee of such a firm and personally worked on the
Companys audit within that time;
    
    A trust manager who is employed, or whose immediate family member is employed, as an
executive officer of another company where any of the Companys present executives
serve on that companys compensation committee is not independent until three years
after the end of such service or the employment relationship; and
    
    A trust manager who is an executive officer or an employee, or whose immediate
family member is an executive officer, of a company that makes payments to, or receives
payments from, the Company for property or services in an amount which, in a single
fiscal year, exceeds the greater of $1 million, or 2% of such other companys
consolidated gross revenues, is not independent until three years after falling below
such threshold.
   Committees
 
 Item 14. Principal Accountant Fees and Services
  26




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##### Table of Contents



Fiscal Year 2006
    
    
    Fiscal Year 2005Audit Fees(1)
    
    $
    639,600
    (3)
    
    $
    3,678,000Audit Related Fees
    
    
    0
    
    
    
    0Tax Fees (2)
    
    
    947,325
    
    
    
    675,775All Other Fees
    
    
    0
    
    
    
    0Total
    
    $
    4,586,925
    
    
    $
    4,353,775
 
 (1)
    
    Audit fees include the audit of our annual financial statements, review of our
quarterly financial statements, audit of managements assessment of internal control over
financial reporting under Section 404 of the Sarbanes-Oxley Act, comfort letters and work
performed in connection with SEC offerings and other filings.(2)
    
    Tax fees include tax consultation and federal and state tax compliance.(3)
    
    Excludes fees associated with the year-end audit that are not yet finalized, and are expected to be approximately $200,000 to $300,000.  27




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##### Table of Contents



SIGNATURES
 th
 CRESCENT REAL ESTATE EQUITIES LIMITED PARTNERSHIP
(Registrant)By:
    CRESCENT REAL ESTATE EQUITIES, LTD., Its General PartnerBy
    /s/John C. GoffJohn C. GoffSole Director and Chief Executive Officer th
 CRESCENT FINANCE COMPANY
(Registrant)By
    /s/John C. GoffJohn C. GoffSole Director and Chief Executive Officer 1




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##### Table of Contents



INDEX TO EXHIBITS
 EXHIBITNUMBER
    
    DESCRIPTION OF EXHIBIT3.01
    
    Fourth Amended and Restated Agreement of Limited Partnership of
Crescent Real Estate Equities Limited Partnership, dated as of
April 30, 2006, as amended (filed as Exhibit 10.1 to the Quarterly
Report on Form 10-Q for the quarter ended March 31, 2006 of
Crescent Real Estate Equities Company (the Company) and
incorporated herein by reference)3.02
    
    Certificate of Incorporation of Crescent Finance Company (filed as
Exhibit No. 3.02 to the Registration Statement on Form S-4 (File
No. 333-89194) of the Registrants (the Form S-4) and incorporated
herein by reference)3.03
    
    Bylaws of Crescent Finance Company (filed as Exhibit No. 3.03 to
the Form S-4 and incorporated herein by reference)4.01
    
    Restated Declaration of Trust of Crescent Real Estate Equities
Company, as amended (filed as Exhibit No. 3.1 to the Companys
Current Report on Form 8-K filed April 25, 2002 and incorporated
herein by reference)4.02
    
    Fourth Amended and Restated Bylaws of Crescent Real Estate
Equities Company (filed as Exhibit 3.02 to the Companys Annual
Report on Form 10-K for the fiscal year ended December 31, 2005,
incorporated herein by reference)4.03
    
    Amended and Restated Registration Rights Agreement among the
Registrant, Richard E. Rainwater, Darla D. Moore, Courtney E.
Rainwater, Matthew J. Rainwater, R. Todd Rainwater, The Richard E.
Rainwater Charitable Remainder Unit Trust No. 2 and Rainwater,
Inc. (filed as Exhibit No. 4.05 to Amendment No. 1 to the Form S-4
and incorporated herein by reference)4*
    
    Pursuant to Regulation S-K Item 601 (b) (4) (iii), the Registrants
by this filing agree, upon request, to furnish to the Securities
and Exchange Commission a copy of instruments defining the rights
of holders of long-term debt of the Registrants10.01
    
    Noncompetition Agreement of Richard E. Rainwater, as assigned to
the Registrant on May 5, 1994 (filed as Exhibit No. 10.02 to the
Companys Annual Report on Form 10-K for the fiscal year ended
December 31, 1997 (the Company 1997 10-K) and incorporated herein
by reference)10.02
    
    Noncompetition Agreement of John C. Goff, as assigned to the
Registrant on May 5, 1994 (filed as Exhibit No. 10.03 to the
Company 1997 10-K and incorporated herein by reference)
 1




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##### Table of Contents



EXHIBITNUMBER
    
    DESCRIPTION OF EXHIBIT10.04
    
    Form of Officers and Trust Managers Indemnification Agreement as
entered into between the Company and each of its executive
officers and trust managers (filed as Exhibit No. 10.07 to the
Registration Statement on Form S-4 (File No. 333-42293) of the
Registrant and incorporated herein by reference)10.05*
    
    Crescent Real Estate Equities Company 1994 Stock Incentive Plan
(filed as Exhibit No. 10.07 to the Companys Registration
Statement on Form S-11 (File No. 33-75188) (the Form S-11) and
incorporated herein by reference)10.06*
    
    Third Amended and Restated 1995 Crescent Real Estate Equities
Company Stock Incentive Plan (filed as Exhibit No. 10.01 to the
Companys Quarterly Report on Form 10-Q for the quarter ended June
30, 2001 and incorporated herein by reference)10.07*
    
    Amendment dated as of November 4, 1999 to the Crescent Real Estate
Equities Company 1994 Stock Incentive Plan (filed as Exhibit No.
10.10 to the Companys Annual Report on Form 10-K for the fiscal
year ended December 31, 2000 (the Company 2000 10-K) and
incorporated herein by reference)10.08*
    
    Amendment dated as of November 1, 2001 to the Crescent Real Estate
Equities Company 1994 Stock Incentive Plan and the Third Amended
and Restated 1995 Crescent Real Estate Equities Company Stock
Incentive Plan (filed as Exhibit No. 10.11 to the Companys Annual
Report on Form 10-K for the fiscal year ended December 31, 2001
and incorporated herein by reference)10.09*
    
    Second Amended and Restated 1995 Crescent Real Estate Equities
Limited Partnership Unit Incentive Plan (filed as Exhibit No.
10.10 to the Companys Annual Report on Form 10-K for the fiscal
year ended December 31, 2003 and incorporated herein by reference)10.10*
    
    1996 Crescent Real Estate Equities Limited Partnership Unit
Incentive Plan, as amended (filed as Exhibit No. 10.14 to the
Companys Annual Report on Form 10-K for the fiscal year ended
December 31, 1999 and incorporated herein by reference)10.11*
    
    Amendment dated as of November 5, 1999 to the 1996 Crescent Real
Estate Equities Limited Partnership Unit Incentive Plan (filed as
Exhibit No. 10.13 to the Company 2000 10-K and incorporated herein
by reference)10.12*
    
    Crescent Real Estate Equities, Ltd. Dividend Incentive Unit Plan
(filed as Exhibit No. 10.14 to the Company 2000 10-K and
incorporated herein by reference)10.13*
    
    Annual Incentive Compensation Plan for select Employees of
Crescent Real Estate Equities, Ltd. (filed as Exhibit No. 10.15 to
the Company 2000 10-K and incorporated herein by reference)
 2




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##### Table of Contents



EXHIBITNUMBER
    
    DESCRIPTION OF EXHIBIT10.14*
    
    Form of Registration Rights, Lock-up and Pledge Agreement (filed
as Exhibit No. 10.05 to the Form S-11 and incorporated herein by
reference)10.15
    
    Restricted Stock Agreement by and between the Company and John C.
Goff, dated as of February 19, 2002 (filed as Exhibit No. 10.02 to
the Company 2002 1Q 10-Q and incorporated herein by reference)10.16
    
    Unit Option Agreement pursuant to the 1996 Plan by and between the
Registrant and John C. Goff, dated as of February 19, 2002 (filed
as Exhibit No. 10.01 to the Companys Quarterly Report on Form
10-Q for the quarter ended June 30, 2002 and incorporated herein
by reference)10.17*
    
    Unit Option Agreement by and between the Registrant and John C.
Goff, dated as of February 19, 2002 (filed as Exhibit No. 10.04 to
the Company 1Q 2002 10-Q and incorporated herein by reference)10.18*
    
    Unit Option Agreement by and between the Registrant and Dennis H.
Alberts, dated as of February 19, 2002 (filed as Exhibit No. 10.05
to the Company 1Q 2002 10-Q and incorporated herein by reference)10.19*
    
    Unit Option Agreement by and between the Registrant and Kenneth S.
Moczulski, dated as of February 19, 2002 (filed as Exhibit No. 10.06 to the Company 1Q 2002 10-Q and incorporated herein by
reference)10.20*
    
    Unit Option Agreement by and between the Registrant and David M.
Dean, dated as of February 19, 2002 (filed as Exhibit No. 10.07 to
the Company 1Q 2002 10-Q and incorporated herein by reference)10.21*
    
    Unit Option Agreement by and between the Registrant and Jane E.
Mody, dated as of February 19, 2002 (filed as Exhibit No. 10.08 to
the Company 1Q 2002 10-Q and incorporated herein by reference)10.22*
    
    Unit Option Agreement by and between the Registrant and Jerry R.
Crenshaw, Jr., dated as of February 19, 2002 (filed as Exhibit No. 10.09 to the Company 1Q 2002 10-Q and incorporated herein by
reference)10.23*
    
    Unit Option Agreement by and between the
Registrant and Jane B. Page, dated as of
February 19, 2002 (filed as Exhibit No. 10.10 to
the Company 1Q 2002 10-Q and incorporated herein by reference)10.24*
    
    Unit Option Agreement by and between the
Registrant and John L. Zogg, Jr., dated as of
February 19, 2002 (filed as Exhibit No. 10.11 to
the Company 1Q 2002 10-Q
 3




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##### Table of Contents



EXHIBITNUMBER
    
    DESCRIPTION OF EXHIBITand incorporated herein by reference)10.25*
    
    Unit Option Agreement by and between the
Registrant and Dennis H. Alberts, dated as of
March 5, 2001 (filed as Exhibit No. 10.12 to the
Company 1Q 2002 10-Q and incorporated herein by
reference)10.26*
    
    Unit Option Agreement by and between the
Registrant and Paul R. Smith, dated as of May 16,
2005 (filed as Exhibit No. 10.03 to the Companys
Quarterly Report on Form 10-Q for the quarter
ended June 30, 2005 (the Company 2Q 2005 10-Q)
and incorporated herein by reference)10.27*
    
    2004 Crescent Real Estate Equities Limited
Partnership Long-Term Incentive Plan (filed as
Exhibit 10.27 to the Companys Annual Report on
Form 10-K for the fiscal year ended December 31,
2004 (the Company 2004 10-K) and incorporated
herein by reference)10.28*
    
    2005 Crescent Real Estate Equities Limited
Partnership Long-Term Incentive Plan (filed as
Exhibit 10.02 to the Company 2Q 2005 10-Q and
incorporated herein by reference)10.29
    
    Revolving Credit Agreement of Crescent Real
Estate Funding VIII, L.P., dated February 8,
2005, and Unconditional Guaranty of Payment and
Performance of Crescent Real Estate Equities
Limited Partnership (filed as Exhibit 10.28 to
the Company 2004 10-K and incorporated herein by
reference)10.30
    
    Contribution Agreement effective as of November
10, 2004, relating to the contribution by
Crescent Real Estate Funding I, L.P. of The
Crescent Office Property to Crescent Big Tex I,
L.P. (filed as Exhibit 10.29 to the Company 2004
10-K and incorporated herein by reference)10.31
    
    Purchase and Sale Agreement effective as of
November 10, 2004, relating to the sale by the
Registrant of Houston Center Office Property to
Crescent Big Tex I, L.P. (filed as Exhibit 10.30
to the Company 2004 10-K and incorporated herein
by reference)10.32
    
    Purchase and Sale Agreement effective as of
November 10, 2004, relating to the sale by
Crescent Real Estate Funding X, L.P. of Post Oak
Central Office Property to Crescent Big Tex I,
L.P. (filed as Exhibit 10.31 to the Company 2004
10-K and incorporated herein by reference)12.01
    
    Statement Regarding Computation of Ratio of
Earnings to Fixed Charges (filed as Exhibit 12.01
to the Registrants Annual Report on Form 10-K
for the fiscal year ended December 31, 2006 (the
2006 10-K) and incorporated herein by reference)
 4




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##### Table of Contents



EXHIBITNUMBER
    
    DESCRIPTION OF EXHIBIT21.01
    
    List of Subsidiaries (filed as Exhibit 21.01 to
the 2006 10-K and incorporated herein by
reference)23.01
    
    Consent of Ernst & Young LLP (filed as Exhibit
23.01 to the 2006 10-K and incorporated herein by
reference)23.02
    
    Consent of Deloitte & Touche LLP (filed as
Exhibit 23.02 to the 2006 10-K and incorporated
herein by reference)31.01
    
    Certifications of Chief Executive Officer and
Chief Financial Officer pursuant to Rule 13a 
14(a) as adopted pursuant to Section 302 of the
Sarbanes-Oxley Act of 2002 (filed herewith)32.01
    
    Certifications of Chief Executive Officer and
Chief Financial Officer pursuant to 18 U.S.C.
Section 350 as adopted pursuant to Section 906 of
the Sarbanes-Oxley Act of 2002 (filed herewith)
 5