Exhibit 10.4


EXECUTION COPY


TRAMMELL
CROW COMPANY

2006 ANNUAL PRINCIPAL BONUS PLAN


Objectives


The Trammell Crow Company 2006
Annual Principal Bonus Plan (the “Plan”) is intended to reward Eligible
Participants (defined below) for their contributions to the business
performance of Trammell Crow Company (the “Company”) and its subsidiaries
during the 2006 fiscal year.


Participants and Eligibility


The term “Participant” shall mean an individual who,
after December 31, 2005, and prior to January 1, 2007, is or was a Principal,
Managing Director, Senior Managing Director, Operating Committee member, or
Executive Committee member, as each such term is commonly used within the
Company; provided, however, that following the Effective Time (as defined in
the Agreement and Plan of Merger, dated October 30, 2006, by and among the
Company, CB Richard Ellis Group, Inc. (“Parent”), and A-2 Acquisition Corp.
(the “Merger Agreement”)), if all former members of the Company’s Board of
Directors have ceased to serve on the Board of Directors of Parent before the
allocation of the Bonus Pool (as defined below), the term “Participant” shall
exclude brokers (i.e., individuals whose primary
job is to act as a broker and whose primary source of income from the Company
is commissions), employees who are eligible for the Development Incentive (as
such term is defined in the Company’s D&I Compensation Policy as updated
July 18, 2006, the “Development Incentive”)), and individuals who work in a “hybrid”
city (a list of which are attached as Exhibit A).


The term “Eligible Participant” shall mean: (a) prior
to the Effective Time, a Participant designated by the Compensation Committee
of the Board of Directors of the Company (the “Compensation Committee”) in its
sole and absolute discretion to be eligible to receive an allocation of the
Bonus Pool; and (b) on and after the Effective Time, a Participant who (1) is
an employee of the Company or Parent or any of their respective subsidiaries at
the time of payment of the bonus hereunder, or (2) is terminated without cause
at or after the Effective Time, by the Company or Parent or any of their
respective subsidiaries.  Following the
Effective Time, the determination of whether a Participant has been terminated
with or without cause shall be determined in the sole and absolute discretion
of those members of Parent’s Board of Directors who served on the Board of
Directors of the Company immediately prior to the Effective Time (the “New
Directors”).


Bonus Pool


The Eligible Participants, as a group, shall be
entitled to receive aggregate cash bonus compensation for the year ending
December 31, 2006, in an amount equal to the Bonus Pool.  “Bonus Pool” means the amount equal to the
product of (a) twenty-two percent (22%) and (b) the difference between (1) the
sum of (A) the consolidated net income of the Company and its subsidiaries
before income taxes for the year ending December 31, 2006, determined in a
manner consistent with the determination of the consolidated net income of the
Company and its subsidiaries before income taxes for the year ended December
31, 2005, as illustrated on Exhibit B (“NIBT”) and (B) the aggregate amount of
non-reimbursed bonuses accrued by the Company 









 



(i.e., bonuses
accrued on the books of the Company as of December 31, 2006, with respect to
Eligible Participants in accordance with this Plan, but not reimbursed by a
customer or other third party) payable to Participants with respect to the year
ending December 31, 2006, and (2) the aggregate amount of bonuses payable
to individuals who work in a “hybrid” city (a list of which is attached as
Exhibit A) with respect to the year ending December 31, 2006, that were accrued
and payable on account of Global Services earnings within that city.  Except as otherwise expressly provided in the
Plan, the Bonus Pool shall be determined in a manner consistent with the
determination of the bonus pool for 2005, a description of which is included in
Exhibit B (except that 2005 bonuses paid with restricted stock awards shall be
deemed to have been paid in cash).


If the Closing (as defined in the Merger Agreement)
occurs on or prior to December 31, 2006, the amount of the Bonus Pool will be
calculated as if the Company had continued as a separate entity (without
undergoing a change in control), notwithstanding any post-Closing change to the
legal organization of the business carried out by the Company and its
subsidiaries prior to Closing.  Without
limiting the foregoing, whether the Effective Time occurs in 2006 or
thereafter, the Bonus Pool shall be computed without giving effect to any
expenses, charges or accounting adjustments resulting from, or associated with,
the negotiation, execution and performance of the Merger Agreement (including
the Merger and the other transactions contemplated thereby), including, but not
limited to, compensation charges, the impact of accounting changes required by
generally accepted accounting principles with respect to the Company’s equity
interest in Savills plc (“Savills”) (determined as provided below), transaction
expenses, restructuring or similar charges, employee retention payments and
severance payments.  For purposes of
determining the Bonus Pool, the Company shall be deemed to account for its
equity interest in Savills for the calendar quarter ending December 31, 2006,
utilizing the equity method of accounting for investments and the actual
results of operations of Savills for the year ending December 31, 2006, if such
information regarding Savills’ results of operations is then available to the
Company when the Bonus Pool is determined. 
If information providing the actual results of operations of Savills for
the year ending December 31, 2006, is not then available when the Bonus Pool is
determined, the Company shall account for its equity interest in Savills for
the calendar quarter ending December 31, 2006, utilizing the estimated results
of operations of Savills for the year ending December 31, 2006, published by
ABN AMRO, reduced by the amounts previously recorded by the Company to reflect
its equity interest in Savills under the equity method for the nine months
ended September 30, 2006.


To the extent that they are reimbursed by a customer
or other third party, annual cash bonuses awarded to Participants shall not
reduce the Bonus Pool (i.e., such
bonuses shall be totally disregarded for purposes of the Bonus Pool and not be
deemed to be paid out of the Bonus Pool). 
Notwithstanding the foregoing sentence, such Participants shall be
eligible to participate in, and to receive amounts from, the Bonus Pool in
addition to reimbursed bonuses (and such amounts received shall correspondingly
reduce the Bonus Pool).


If a Participant works in a “hybrid” city and receives
a bonus, the portion of that bonus paid on account of Global Services earnings
within that city shall be counted as being a payment out of the Bonus Pool and
the portion of the bonus not relating to Global Services earnings within that
city shall not be counted as being a payment out of the Bonus Pool.  The calculation of the hybrid city bonus and the
allocation of these bonuses to Global Services earnings shall be made 









 



based on the accounting records of the Company and its
subsidiaries on a basis consistent with such determinations made for the
calendar year ended December 31, 2005.


Development Incentive payments shall not be counted as
being a payment out of the Bonus Pool. 
Bonuses for members of the Development and Investment group that are not
eligible to receive a Development Incentive shall be paid from the Bonus Pool.


Allocation of Bonus Pool


Prior to the Effective Time, but in no event later
than March 9th,
2007, if the allocation is then made during such time period, the Bonus Pool
shall be allocated among Eligible Participants in accordance with the
determination of the Compensation Committee, as determined in its sole and
absolute discretion.


If the Bonus Pool has not been allocated among
Eligible Participants in accordance with the above paragraph prior to the
Effective Time, on and after the Effective Time the Bonus Pool shall be allocated
among Eligible Participants in accordance with the determination of the New
Directors, as determined in their sole and absolute discretion; provided,
however, that if any New Director is an Eligible Participant, the amount of the
Bonus Pool allocated to such New Director shall be determined by the other New
Directors; provided, further, however, that if any New Director that is an
Eligible Participant is required to file statements of ownership under Section
16 of the Securities Exchange Act of 1934, the amount of the Bonus Pool
allocated to such New Director shall be ratified by the Board of Directors or
Compensation Committee of Parent; provided, further, however, that if such
determination has not been made on or before March 9th, 2007, or if all former members of the
Company’s Board of Directors have ceased to serve on the Board of Directors of
Parent before such allocation is made, the Bonus Pool shall be allocated among
the Eligible Participants pursuant to the formula attached as Exhibit C.


Payment of Bonuses


Each Eligible Participant shall receive a cash bonus
in an amount equal to his or her allocation of the Bonus Pool, as determined in
accordance with the Plan.  Bonuses shall
be paid in a lump-sum as soon as practicable following the allocation of the
Bonus Pool, but in no event later than March 15th, 2007.


Successors


The Plan shall be binding on any successor (whether
direct or indirect, by purchase, merger, consolidation or otherwise) to all or
substantially all of the business and/or assets of the Company.


Termination or Amendment


Prior to the Effective Time, the Compensation
Committee may amend, alter, suspend, discontinue or terminate the Plan without
the consent of the Eligible Participants. 
After the Effective Time, the Plan cannot be amended, altered,
suspended, discontinued, or terminated, unless all New Directors consent.  Notwithstanding the foregoing, the Plan shall
terminate automatically, effective as of the earlier of (a) the date on which
the Merger Agreement is 









 



terminated in accordance with its terms without
consummation of the merger contemplated thereby, or (b) the later of (1) March
15th,
2007, and (2) the date on which all Eligible Participants have received the
bonuses to which they are entitled pursuant to the Plan.  Upon termination, the Plan shall be null and
void and have no force or effect, and the Company and its successors thereafter
shall have no liability or obligation under the Plan whatsoever to the
Participants.


Rights of Participants


A Participant shall have full rights to enforce the
terms of this Plan against the Company or any successor.


Effective Date


The Plan is effective as of October 30, 2006.


	
  

  	
  TRAMMELL CROW COMPANY

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ J. Christopher Kirk

  
	
   

  	
  Name:

  	
  J. Christopher Kirk

  
	
   

  	
  Title:

  	
  Executive Vice President

  



 















 


EXHIBIT A


Hybrid
Cities


Austin, Texas

Kansas City, Missouri

Oklahoma City, Oklahoma

Portland, Oregon

Reno, Nevada

San Antonio, Texas

San Diego, California

Tulsa, Oklahoma


 



 A-1














 


EXHIBIT B


TRAMMELL CROW COMPANY 2005 PRINCIPAL
BONUS POOL SUMMARY


 


	
  NIBT with 100% bonus
  accrual

  	
   

  	
  101,920,748

  	
   

  
	
  Principal bonus accrual

  	
   

  	
  20,682,498

  	
   

  
	
  Pre bonus NIBT

  	
   

  	
  122,603,246

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  Adjusted Pre bonus NIBT

  	
   

  	
  122,603,246

  	
   

  
	
  Principal Bonus Pool
  (25% of pre bonus NIBT)

  	
   

  	
  30,650,812

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  NIBT before bonus
  adjustment

  	
   

  	
  101,920,748

  	
   

  
	
  Principal bonus pool
  adjustment

  	
   

  	
  (9,968,314

  	
  )

  
	
  Estimated NIBT

  	
   

  	
  91,952,435

  	
   

  
	
  Bonus Pool paid with
  Restricted Stock

  	
   

  	
  2,334,436

  	
   

  
	
  Final 2005 NIBT

  	
   

  	
  94,286,871

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  Bonus Pool

  	
   

  	
  30,650,812

  	
   

  
	
  Bonus Pool Adjustments

  	
   

  	
  2,635,804

  	
   

  
	
  Bonus Pool to allocate
  after adjustments

  	
   

  	
  28,015,008

  	
   

  
	
  Average Percent of
  Target Bonus Paid

  	
   

  	
  135.5

  	
  %

  
	
  RSU’s

  	
   

  	
  2,334,436

  	
   

  
	
  Service related hybrid bonus payments

  	
   

  	
  301,368

  	
   

  



 


These numbers do
not include principal bonuses reimbursed by customers.



 B-1














 


EXHIBIT
C


If a determination as to the allocation of the Bonus
Pool has not been made on or before March 9th, 2007, or if all New Directors cease to
serve on the Board of Directors of Parent before making such determination, the
Bonus Pool shall be allocated among the Eligible Participants pursuant to the
following formula:


New
Participant’s Allocation =


a + .5[(a/b)(c
- b)], if the aggregate
amount of all 2006 Target Bonuses is less than or equal to the Bonus Pool; and


a(c/b),
if the aggregate amount of all 2006 Target Bonuses is greater than the Bonus
Pool.


Where:


a
= the New Participant’s 2006 Target Bonus;


b
= the aggregate amount of all 2006 Target Bonuses; and


c = the aggregate amount of the 2006 Bonus Pool.


“New Participant”
means an Eligible Participant who did not participate in the Company’s 2005
Bonus Pool.


Eligible
Participant’s (other than a New Participant) Allocation = (c
- d)(e/f)


Where:


c
= the aggregate amount of the 2006 Bonus Pool;


d
= the sum of the New Participant allocations of the 2006 Bonus Pool, as
determined above;


e
= the Participant’s 2005 bonus; and


f = the 2005 Bonus Pool, reduced by the aggregate
amount of 2005 Principal bonuses paid to individuals who (a) are not
Participants immediately after the Effective Time; or (b) are not employees of
the Company or Parent or any of their respective subsidiaries at the time of
payment of the 2006 Principal bonus (unless the reason an individual is not an
employee of the Company or Parent or any of their respective subsidiaries at
the time of payment is because such individual was terminated without cause, at
or after the Effective Time, by the Company or Parent or any of their
respective subsidiaries).


 



 C-1