DEFERRED SHARES AWARD AGREEMENT

 

 

 

                                                                   Exhibit 10.1

 

 

                        DEFERRED SHARES AWARD AGREEMENT

 

         This Deferred Shares Award Agreement, dated as of December 21, 2005,

is made and entered into by and between Global Signal Inc., a Delaware company

(the "Company") and Ronald Bizick ("Employee") pursuant to the Global Signal

Inc. Omnibus Stock Incentive Plan (the "Plan").

 

                             ______________________

 

         WHEREAS, the Company maintains the Plan for the benefit of selected

management employees, directors and Consultants of the Company or its parents

or subsidiaries; and

 

         WHEREAS, the Company previously granted to Employee an option to

purchase shares of the Company's Common Stock, of which twenty-five percent

(25%) of the shares have a per share exercise price equal to $8.53 and the

remaining seventy-five percent (75%) of the shares have a per share exercise

price equal to $18.00 (the "Option") subject to the terms set forth in that

certain agreement between the Company and Employee, dated March 22, 2004 (the

"Option Agreement"), which Option is outstanding as of the date hereof; and

 

         WHEREAS, pursuant to the terms of the Option Agreement, the Option is

unvested and unexcercisable with respect to 574,000 shares of Common Stock as

of the date hereof (the "Unvested Option Shares"); and

 

         WHEREAS, the Board desires to accelerate the vesting of that portion

of the Option that relates to 184,500 Unvested Option Shares otherwise

scheduled to vest on December 31, 2006; and

 

         WHEREAS, the Company and Employee have agreed to cancel that portion

of the Option that relates to the remaining 143,500 Unvested Option Shares

otherwise scheduled to vest on December 31, 2006, in consideration for an award

of Deferred Shares pursuant to Section 9 of the Plan under the terms and

conditions as set forth herein (the "Cancellation and Award").

 

         NOW, THEREFORE, in consideration of the foregoing and for other good

and valuable consideration, the receipt and sufficiency of which is hereby

acknowledged, the parties hereto agree as follows:

 

I. OPTION ACCELERATION AND CANCELLATION

 

         1.1. Acceleration. In consideration of the Cancelled Option (as

defined in Section 1.2 below) by Employee, as of December 31, 2005, the Board

hereby agrees to accelerate the vesting of that portion of the Option that

relates to the 184,500 Unvested Option Shares as set forth in Schedule A so

that such shares are fully vested and immediately exercisable in accordance

with the terms of the Option Agreement ("Acceleration").

 

         1.2. Cancellation. Employee hereby agrees to cancel that portion of

the Option that relates to the 143,500 Unvested Option Shares as set forth in

Schedule A (the "Cancelled Option") as of December 31, 2005. Employee

understands and agrees that Employee is forever relinquishing the right to

exercise the Option with respect to the Cancelled Option and any rights to or

in respect of the Shares covered thereby. Employee hereby irrevocably and

unconditionally releases, waives and discharges all claims, promises, causes of

action, or similar rights of any type that Employee may have, whether known or

unknown, unforeseen, unanticipated, unsuspected or latent that Employee may now

have against any of the Released Parties (as defined herein) as of the Date of

Grant in connection with the Acceleration and the Cancellation and Award. For

purposes of this Deferred Shares Award Agreement, the "Released Parties" are

the Company and all related and affiliated entities (including corporations,

limited liability companies, partnerships, and joint ventures) and, with

respect to each of the Company and its affiliated entities, each of their

respective predecessors and successors, past, present and future employees,

officers, directors, stockholders, owners, partners, members, representatives,

assigns, attorneys, agents, insurers, employee benefit programs (and the

trustees, administrators, fiduciaries, and insurers of such programs), and any

other persons acting by, through, under, or in concert with any of the

foregoing identified Released Parties.

 

         1.3. Full Force and Effect. Except as otherwise provided herein, the

terms of the Option Agreement shall remain in full force and effect.

 

II. DEFERRED SHARES

 

         2.1. Deferred Shares Award. In consideration for the Cancelled Option

by Employee, on December 31, 2005 (the "Date of Grant"), the Company hereby

agrees to grant to Employee a Deferred Shares Award representing the right to

receive up to that number of Shares equal to 150% of the "Deferred Shares,"

which Deferred Shares is determined by the formula set forth on Schedule B (the

"Award"). The Shares subject to the Award shall vest and become payable in

accordance with the provisions of Sections 2.2 and 2.3 below. Subject to

Section 2.4, the Company shall issue a stock certificate in respect of such

Award as soon as reasonably practicable following the vesting dates.

 

         2.2. Time Based Vesting Schedule. Fifty percent (50%) of the Shares

subject to the Award that are payable pursuant to the satisfaction of the

Performance Goals, shall vest and become payable on December 31, 2006, and

fifty percent (50%) of the Shares subject to the Award that are payable

pursuant to the satisfaction of the Performance Goals, shall vest and become

payable on December 31, 2007.

 

         2.3. Performance Goals. The performance goals for purposes of

determining whether, and the extent to which, the Deferred Shares Award shall

be payable shall be based on the Company's annualized dividend declared in

respect of the fourth quarter of 2006, which shall be equal to the product of

four times the Company's dividend declared in respect of the fourth quarter of

2006 (the "Q4 Dividend Run Rate"). Subject to Sections 2.2 and 2.5 below, upon

determination of the Q4 Dividend Run Rate, Employee's entitlement to the number

of Shares subject to the Award shall be fixed and nonforfeitable and shall not

be conditioned upon the Company's future performance.

 

                  2.3.1. If the Company's Q4 Dividend Run Rate is less than or

equal to $2.20 per share, then 0% of the Deferred Shares shall be payable

pursuant to the Deferred Shares Award.

 

                  2.3.2. If the Company's Q4 Dividend Run Rate is at least

equal to $2.21 per share but less than $2.30 per share, then 75% of the

Deferred Shares shall be payable pursuant to the Deferred Shares Award.

 

                  2.3.3. If the Company's Q4 Dividend Run Rate is at least

equal to $2.30 per share but less than $2.41 per share, then 100% of the

Deferred Shares shall be payable pursuant to the Deferred Shares Award.

 

                  2.3.4. If the Company's Q4 Dividend Run Rate is at least

equal to $2.41 per share but less than $2.51 per share, then 125% of the

Deferred Shares shall be payable pursuant to the Deferred Shares Award.

 

                  2.3.5. If the Company's Q4 Dividend Run Rate is equal to

$2.51 per share or greater, then 150% of the Deferred Shares shall be payable

pursuant to the Deferred Shares Award.

 

         2.4. Income Tax Matters; Tax Witholding.

 

                  2.4.1. Set forth below is a brief summary as of the Date of

Grant of certain United States federal tax consequences of the Deferred Shares

Award. THIS SUMMARY DOES NOT ADDRESS SPECIFIC STATE, LOCAL OR FOREIGN TAX

CONSEQUENCES THAT MAY BE APPLICABLE TO THE EMPLOYEE. THE EMPLOYEE UNDERSTANDS

THAT THIS SUMMARY IS NECESSARILY INCOMPLETE, AND THE TAX LAWS AND REGULATIONS

ARE SUBJECT TO CHANGE. For federal income tax purposes, Employee generally will

not have taxable income on the grant of the Deferred Shares Award. Employee

will recognize ordinary income at the time or times the Shares covered by the

Award vests in an amount equal to the Fair Market Value of such Shares on each

such dat