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SEVERANCE AGREEMENT

Termination Severance Agreement

SEVERANCE AGREEMENT | Document Parties: CROWN CASTLE INTERNATIONAL CORP You are currently viewing:
This Termination Severance Agreement involves

CROWN CASTLE INTERNATIONAL CORP

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Title: SEVERANCE AGREEMENT
Date: 7/15/2008
Industry: Communications Services     Sector: Services

SEVERANCE AGREEMENT, Parties: crown castle international corp
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Exhibit 10.1

SEVERANCE AGREEMENT

SEVERANCE AGREEMENT (“ Agreement ”), dated effective July 1, 2008 (“ Commencement Date ”) by and between Crown Castle International Corp. and Jay A. Brown, (the “ Executive ”).

This Agreement sets forth the terms and conditions of contingent severance arrangements between the Company (as defined below) and the Executive and cancels and supersedes all other severance related agreements between the parties.

 

I. DEFINITIONS

For all purposes hereof, the following defined terms have the meanings set forth below:

1.1 “ Accrued Obligations ” means all (i) accrued but unpaid Base Salary to the Executive’s Date of Termination, (ii) any earned but unpaid bonus (other than the Current Annual Bonus and Prior Year Bonus), and (iii) any benefits for which the Executive is eligible under the terms of any benefit Plan of the Company or its subsidiaries.

1.2 “ Annual Bonus ” means sixty-five percent (65%) of the Base Salary.

1.3 “ Base Salary ” means the greater of (i) the Executive’s annual base salary as of the date of Executive’s Qualifying Termination (without taking into account any reductions that constitute Good Reason) or (ii) if applicable, the Executive’s annual base salary in effect on the date of a Change in Control.

1.4 “ Cause ” means (i) the Executive’s conviction of, or plea of guilty or nolo contendere to, any criminal violation involving dishonesty, fraud or breach of trust, or any felony which materially adversely affects the Company or (ii) willful engagement by the Executive in gross misconduct in the performance of duties owed the Company that materially adversely affects the Company.

1.5 “ Change in Control ” has the meaning set forth on Schedule 1 hereto.

1.6 “ Change in Control Period ” means the period beginning on the date of a Change in Control and ending on the second anniversary of that Change in Control.

1.7 “ Company ” means Crown Castle International Corp. and any successors thereto.

1.8 “ Current Annual Bonus ” means the Executive’s target annual bonus for the calendar year with the Date of Termination, prorated on a daily basis from the beginning of the calendar year to the Date of Termination.

1.9 “ Date of Termination ” means the effective date of the termination of the Executive’s employment with the Company and its subsidiaries (as set forth in the Notice of Termination, if applicable) and interpreted consistently as a “separation from service” under Section 409A of the Code (“ Section 409A ”).

 


1.10 “ Disability ” means the Executive’s inability to perform the primary duties of Executive’s position for at least 180 consecutive days due to a physical or mental impairment and confirmed by a medical examination to the Company’s satisfaction.

1.11 “ Good Reason ” means (i) the assignment to the Executive of any duties materially inconsistent with the Executive’s position, authority, duties or responsibilities as of the date hereof or as of the date immediately preceding a Change in Control, if applicable, or any other action by the Company that results in a material diminution in such position, authority, duties or responsibilities; (ii) a decrease in the Executive’s Base Salary or significant decrease in annual or long term bonus opportunity; (iii) a material reduction in any material benefits or other compensation provided to the Executive; (iv) the Company requiring the Executive to be based at any office or location outside the Houston metropolitan area; (v) the Company’s material failure to comply with its obligations under this Agreement; or (vi) the Company giving Notice (as defined in Section 2.1 (i)). For purposes of any determination regarding the existence of Good Reason during the Change in Control Period, any good faith determination by the Executive that Good Reason exists shall be presumed to be correct unless the Company establishes by clear and convincing evidence that Good Reason does not exist.

1.12 “ Non-Qualifying Termination ” means any termination of the Executive’s employment with the Company and its subsidiaries other than a Qualifying Termination.

1.13 “ Normal Option Expiration Date ” means the normal expiration of each of the Stock Options without taking into account any accelerated expiration date provisions relating to termination of employment, board membership or otherwise.

1.14 “ Notice of Termination ” means a written notice of the termination of the Executive’s employment that (i) indicates the specific termination provision in this Agreement relied upon, (ii) sets forth in reasonable detail, if applicable, the facts and circumstances claimed to provide a basis for termination of the Executive’s employment under the provision so indicated and (iii) if the Date of Termination is other than the date of receipt of such notice, specifies the termination date. The failure by the Executive to set forth in the Notice of Termination any fact or circumstance that contributes to a showing of Good Reason shall not waive any right of the Executive hereunder or preclude the Executive from asserting such fact or circumstance in enforcing the Executive’s rights hereunder.

1.15 “ Plan ” means any plan, program, practice, arrangement or policy.

1.16 “ Plan Economic Equivalent ” means (i) the costs of a reasonable comparable substitute Plan selected by the Executive and Company for any Plan which does not permit the Executive’s continued participation after the Date of Termination plus a gross up amount for any increases in net income taxes to the Executive relating to such provision of a substitute Plan or (ii) if Executive becomes covered by another benefit Plan, the Company’s incremental costs savings of not providing such benefits to the Executive, commencing 30 days after written notice from Executive to terminate such benefits plus any additional reasonable Plan or benefit notice or termination period the Company reasonably needs to receive costs savings.

 

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1.17 “ Prior Year Bonus ” means the unpaid annual incentive bonus for the year prior to the Date of Termination, if any, determined in accordance with the Company’s incentive or annual bonus plan for the year prior to the Date of Termination.

1.18 “ Qualifying Termination ” means (i) the Company’s termination of the Executive’s employment with the Company for any reason other than for Cause or Disability or death or (ii) the Executive’s termination of employment with the Company within 60 days of the occurrence of an event that constitutes Good Reason. A transfer of the Executive to any subsidiary of the Company shall not be considered a termination of employment hereunder.

1.19 “Restricted Stock Awards” means restricted stock awards, phantom stock awards and other similar equity-based incentive compensation awards granted to the Executive relating to stock of the Company; provided, such awards exclude Stock Options.

1.20 “ Stock Options ” means stock options granted to the Executive to acquire stock of the Company.

1.21 Other Terms . Other capitalized terms shall have the meaning indicated within this Agreement.

 

II. TERM AND POSITION

2.1 Term . This Agreement is effective as of the Commencement Date and terminates on the fifth anniversary of the Commencement Date (the “ Term ”); provided that, (i) beginning on the fifth anniversary of the Commencement Date and each anniversary thereafter (each, an “ Anniversary Date ”) the Term shall be extended by 12 months unless either party provides notice (the “ Notice ”) at least 60 days before any such Anniversary Date of his or its intent to terminate this Agreement as of such Anniversary Date, and (ii) if a Change in Control occurs during the Term, this Agreement shall not expire until the later of (a) the expiration of the Term or (b) the end of the Change in Control Period.

2.2 Position . During the Term, the Executive shall serve as Senior Vice President and Chief Financial Officer of the Company (or a similar position), or such other position agreed to in writing by the Company and Executive.

 

III. TERMINATION OF EMPLOYMENT

3.1 Termination by the Executive .

(a) Termination for Good Reason . The Executive may terminate Executive’s employment during the Term for Good Reason by delivering a Notice of Termination to the Company in accordance with Section 6.8 within 60 days of the occurrence of the event purported to constitute “Good Reason” hereunder.

(b) Termination Without Good Reason . The Executive may terminate Executive’s employment during the Term without Good Reason by delivering a Notice of Termination to the Company in accordance with Section 6.8 at least 15 days prior to the effective date of such termination.

 

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3.2 Termination by the Company .

(a) Termination for Cause . The Company may terminate the Executive’s employment during the Term for Cause by delivering to the Executive in accordance with Section 6.8 a Notice of Termination and a copy of a resolution, duly adopted by the affirmative vote of not less than a majority of the entire membership of the Board of Directors of the Company (the “ Board ”), including at least 66-  2 / 3 % of those members of the Board who are not employees of the Company at a meeting of the Board called and held for the purpose (after reasonable notice to the Executive and an opportunity for Executive, together with counsel, to be heard before the Board), finding that in the good faith opinion of the Board, the Executive was guilty of conduct specified in the definition of “Cause”.

(b) Termination Without Cause . The Company may terminate the Executive’s employment during the Term without Cause by delivering a Notice of Termination to the Executive in accordance with Section 6.8.

3.3 Death or Disability . The Executive’s employment shall terminate automatically upon the Executive’s death during the Term. If the Company determines in good faith that the Disability of the Executive has occurred during the Term, it may give to the Executive a Notice of Termination in accordance with Section 6.8 of this Agreement. In such event, the Executive’s employment shall terminate effective on the 30th day after receipt of such notice, provided that within the 30 days after such receipt, the Executive shall not have returned to full-time performance of the Executive’s duties.

 

IV. BENEFITS UPON TERMINATION

4.1 Qualifying Termination Not Within the Change in Control Period . If, during the Term, the Executive’s employment with the Company and its subsidiaries is terminated in a Qualifying Termination and such termination does not occur during a Change in Control Period:

(a) the Company shall pay to the Executive in a cash lump sum within 30 days after the Date of Termination, the sum of (i) all Accrued Obligations and (ii) the product of one (1) times the sum of the Executive’s Base Salary and Annual Bonus;

(b) for one (1) year following the Date of Termination, or such longer period as each Plan may provide, the Company shall continue medical, dental, and vision benefits to the Executive and the Executive’s family at a level at least equal to those that would have been provided if the Executive’s employment had not been terminated under such Plan of the Company applicable to the Executive as of the Date of Termination (with payment of the Plan Economic Equivalent as to each Plan (i) that does not permit the Executive’s continued participation or (ii) that the Executive becomes covered under another Plan with similar or comparable benefits (after 30 days notice to the Company));

 

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(c) all Stock Options held by the Executive shall become immediately vested and exercisable, and all Restricted Stock Awards held by the Executive shall continue to vest as if the Executive was an employee of the Company for the two (2) year period after the Date of Termination (“ Vesting Period ”);

(d) the Company shall pay the Executive the Current Annual Bonus when and if annual bonuses for the year of termination are paid to other executive officers of the Company;

(e) the Executive shall be entitled to fully participate in the Company’s 401(k) plan for the calendar year with the Date of Termination including the Company contributions based upon participation or matching (with payment of the after-tax economic equivalent if and to the extent such is not permitted under the Company’s 401(k) plan or by applicable law);

(f) the Company shall pay to Executive the Prior Year Bonus when and if any annual bonuses for the year prior to the Date of Termination are paid to other executive officers of the Company; and

(g) the Executive shall, as of such termination, be released by the Company (including its subsidiaries) from any and all claims and causes of action of any kind or character arising from Executive’s employment with the Company (including its subsidiaries and any board membership relating to employment) and the Company shall indemnify and hold harmless the Executive against any such claims or causes of action to the extent permitted by applicable law.

4.2 Qualifying Termination During the Change in Control Period . If, during the Term, the Executive’s employment with the Company and its subsidiaries is terminated in a Qualifying Termination and such termination occurs during a Change in Control Period:

(a) the Company shall pay to the Executive in a cash lump sum within 30 days after the Date of Termination, the sum of (i) all Accrued Obligations and (ii) the product of two (2) times the sum of the Executive’s Base Salary and Annual Bonus;

(b) for two (2) years following the Date of Termination, or such longer period as each Plan may provide, the Company shall continue medical, dental, and vision benefits to the Executive and the Executive’s family at a level at least equal to those that would have been provided if the Executive’s employment had not been terminated under such Plan of the Company applicable to the Executive as of the Date of Termination (with payment of the Plan Economic Equivalent as to each Plan (i) that does not permit the Executive’s continued participation or (ii) that the Executive becomes covered by another Plan with similar or comparable benefits (after 30 days notice to the Company));

 

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(c) all Stock Options and all Restricted Stock Awards held by the Executive shall become immediately vested and such Stock Options shall become immediately exercisable.

(d) the Company shall pay the Executive the Current Annual Bonus when and if annual bonuses for the year of termination are paid to other executive officers of the Company;

(e) the Executive shall be entitled to fully participate in the Company’s 401(k) plan for the calendar year with the Date of Termination including the Company contributions based upon participation or matching (with payment of the after-tax economic equivalent if and to the extent such is not permitted under the Company’s 401(k) plan or by applicable law);

(f) the Company shall pay to Executive the Prior Year Bonus when and if any annual bonuses for the year prior to the Date of Termination are paid to other executive officers of the Company; and

(g) the Executive shall, as of such termination, be released by the Company (including its subsidiaries) from any and all claims and causes of action of any kind or character arising from Executive’s employment with the Company (including its subsidiaries and any board membership relating to employment) and the Company shall indemnify and hold harmless the Executive against any such claims or causes of action to the extent permitted by applicable law.

Any provision in this Agreement to the contrary notwithstanding, if a Change in Control occurs within six (6) months after the Date of Termination, which constitutes a change in ownership or effective control of the Company or a change in the ownership of a substantial portion of its assets within the meaning of such terms under Section 409A, and if it is reasonably demonstrated by the Executive that such termination of employment (x) was at the request of a third party who had taken steps reasonably calculated to effect the Change in Control or (y) otherwise arose in connection with or anticipation of the Change in Control, then for all purposes of this Agreement the termination of the Executive’s employment shall be deemed to have occurred during a Change in Control Period. In such circumstance, the incremental taxable payments pursuant to subsections (a)(ii), (b) and (c) as the result of deemed termination during a Change in Control Period shall be made in the first regularly scheduled payroll date following the Change in Control or, if later, the scheduled date of payment in any bonus or other plan pursuant to which the payments are made.

4.3 Non-Qualifying Termination . If the Executive’s employment with the Company and its subsidiaries is terminated in a Non-Qualifying Termination, this Agreement shall terminate without further obligations to the Executive other than Accrued Obligations; provided, that, if the Executive’s employment is terminated due to Executive’s death or Disability, all Stock Options held by the Executive shall become immediately vested and exercisable, and all Restricted Stock Awards held by the Executive shall continue to vest as if the Executive was an employee of the Company for the Vesting Period.

 

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4.4 Option Exercise and Termination. All vested Stock Options granted to the Executive (including Stock Options vested pursuant to this Agreement) shall be exercisable for 24 months following the later of (a) the Date of Termination or (b) the date that Executive ceases to be a member of the Board and a member of the board of director of any of the Company subsidiaries; provided that the exercise period shall (i) extend to any longer period for exercise of Stock Options pursuant to the applicable stock option agreement or certificate for such Stock Options and (ii) not extend beyond the Normal Option Expiration Date. The Company as to Stock Options granted to the Executive may not (a) require the exercise of such Stock Options, (b) reduce the exercise period for such Stock Options or (c) otherwise take action to circumvent the exercise period for such Stock Options as provided above. The above provisions shall supercede any contrary provisions in any stock option agreement, stock option certificate or other document.

4.5 Excise Tax Payments .

(a) Notwithstanding anything in the Agreement to the contrary, in the event of the determination (as hereinafter provided) that any required payment by the Company to or for benefit of the Executive (whether paid or payable pursuant to the terms of the Agreement or otherwise (individually and collectively, “ Payment ”)) would be subject to the excise tax imposed by Section 4999 of the Internal Revenue Code of 1986, as amended (the “ Code ”) or any successor provision thereto (the “ Excise Tax ”), the Executive shall be entitled to receive an additional payment or payments (individually or collectively, “ Tax Assistance Payment ”), which shall include an amount such that, after the Executive pays (1) all taxes (including any interest or penalties imposed with respect to such taxes) and (2) any Excise Tax (including interest and penalties with respect thereto) imposed upon the Tax Assistance Payment, the Executive retains so much of the Tax Assistance Payment as is equal to the Excise Tax (including interest and penalties with respect thereto) imposed on the Payment.

(b) Subject to the provisions hereinafter concerning the provision of notice of a claim by the Internal Revenue Service (“ IRS ”), all determinations required to be made under these provisions, including whether an Excise Tax is payable by the Executive, the amount of such Excise Tax and whether the Company is required to pay the Executive a Tax Assistance Payment and the amount of such Tax Assistance Payment, if any, shall be made by the Company’s independent accountants or such other nationally recognized accounting firm retained by the Company and reasonably acceptable to the Executive (“ Accounting Firm ”). The Company shall direct the Accounting Firm to submit its determination and detailed supporting calculations to both the Executive and the Company within 30 days after the payment or provision of any benefit that could give rise to an Excise Tax and any such other time or times as the Executive or the Company may request. If the Accounting Firm determines that any Excise Tax is payable by the Executive, the Company shall pay the required Tax Assistance Payment to the Executive within 10 business days after the Company receives such determination and calculations with respect to any Payment to the Executive.

 

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(c) Any federal tax returns the Executive files shall be prepared and filed on a basis consistent with the determination of the Accounting Firm with respect to the Excise Tax payable by the Executive. If the Accounting Firm determines that the Executive is required to pay no Excise Tax, it shall (at the same time it makes such determination) furnish the Executive and the Company an opinion that the Executive has substantial authority not to report any Excise Tax on the Executive’s federal income tax return. However, in view of the uncertainty concerning application of Section 4999 of the Code (or any successor provision thereto) at the time of any determination made hereunder by the Accounting Firm, it is possible that a Tax Assistance Payment that should have been made by the Company will not have been made (“ Underpayment ”), consistent with the calculations required to be made hereunder. In the event the Company exhausts or fails to pursue its remedies pursuant to the provisions concerning notice of a claim by the IRS, and the Executive thereafter is required to make a payment of any Excise Tax, the Executive shall direct the Accounting Firm to determine the amount of the Underpayment and to submit its determination and detailed supporting calculations as promptly as possible both to the Executive and to the Company, which shall pay the amount of such Underpayment to the Executive or for the Executive’s benefit within 10 business days following the Company’s receipt of such determination and calculations.

(d) Each of the Executive and the Company shall provide the Accounting Firm access to and copies of any books, records and documents in the Executive’s or its possession, as the case may be, reasonably requested by the Accounting Firm, and shall otherwise cooperate with the Accounting Firm in connection with the preparation and issuance of the determination and calculations required or contemplated hereunder.

(e) The Company shall bear the fees and expenses of the Accounting Firm for services hereunder. If, for any reason, the Executive initially pays such fees and expenses, the Company shall reimburse the Executive the full amount of the same within 10 business days following receipt from the Executive of a statement and reasonable evidence of the Executive’s payment thereof.

(f) The Executive shall notify the Company in writing of any claim by the IRS that, if successful, would require the Company to pay a Tax Assistance Payment. The Executive shall give such notification as promptly as practicable, but in no event later than the 10th business day next following the Executive’s receipt of such claim, and the Executive further shall apprise the Company of the nature of such claim and the date on which it is required to be paid (in each case, to the extent known to the Executive). The Executive shall not pay or otherwise satisfy such claim prior to the earlier of (a) the expiration of the 30 calendar day period next following the date on which the Executive gives notice to the Company or (b) the date any payment of the amount with respect to such claim is due. If the Company notifies the Executive in writing prior to the expiration of such period that it desires to contest such claim, the Executive shall:

(i) provide the Company any written records or documents in the Executive’s possession relating to


 
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