AMENDMENT AND RESTATEMENT OF THE
VECTRUS, INC. ANNUAL INCENTIVE PLAN
(Effective as of January 1, 2016)

1. PURPOSE     
The purpose of this Vectrus, Inc. Annual Incentive Plan (the “Incentive Plan”)
is to provide incentive compensation in the form of a bonus to eligible
executives of Vectrus, Inc. (the “Company”) for achieving specific
pre-established performance objectives and to continue to motivate participating
executives to achieve their business goals, while tying a portion of their
compensation to measures affecting shareholder value. The Incentive Plan seeks
to enable the Company to continue to be competitive in its ability to attract
and retain executives of the highest caliber.     
2. PLAN ADMINISTRATION
The Compensation and Personnel Committee (the “Committee”) of the Board of
Directors (the “Board”) of the Company shall have full power and authority to
administer, construe and interpret the provisions of the Incentive Plan and to
adopt and amend administrative rules and regulations, agreements, guidelines and
instruments for the administration of the Incentive Plan and for the conduct of
its business as the Committee considers appropriate.
The Committee shall have full power, to the extent permitted by law and the
Committee’ charter, to delegate its authority to any officer or employee of the
Company to administer and interpret the Incentive Plan, subject to the terms of
the Incentive Plan, and references in the Incentive Plan to the “Committee”
shall be read, consistent with the scope of the delegation, as references to
such officers or employees to the extent such officers or employees have been so
delegated authority to act with respect to the Incentive Plan.
The Committee may rely on opinions, reports or statements of officers or
employees of the Company and of counsel to the Company (inside or retained
counsel), public accountants and other professional or expert persons.
The Board reserves the right to amend or terminate the Incentive Plan in whole
or in part at any time; provided, however, that no amendments shall adversely
affect or impair the rights of any participant previously accrued thereby,
without the written consent of the participant, unless required by applicable
law.
No member of the Committee shall be liable for any action taken or omitted to be
taken or for any determination made by him or her in good faith with respect to
the Incentive Plan, and the Company shall indemnify and hold harmless each
member of the Committee against any cost or expense (including counsel fees) or
liability (including any sum paid in settlement of a claim with the approval of
the Committee) arising out of any act or omission in connection with the
administration or interpretation of the Incentive Plan, unless arising out of
such person’s own fraud or bad faith.
3. ELIGIBLE EXECUTIVES
Executives of the Company or its affiliates in salary grade 19 and above shall
be eligible to participate in the Incentive Plan.
4. PLAN YEAR, PERFORMANCE PERIODS, PERFORMANCE MEASURES AND PERFORMANCE TARGETS
Each fiscal year of the Incentive Plan (the “Plan Year”) shall begin on January
1 and end on December 31. The performance period (the “Performance Period”) with
respect to which bonuses may be payable under the Incentive Plan shall be the
Plan Year unless the Committee designates one or more different Performance
Periods.

The Committee shall establish the performance measures (the “Performance
Measures”) to be used which may include, but shall not be limited to:
•
Backlog, including book to bill, total backlog, funded or unfunded;

•
Cash flow, including operating cash flow and free cash flow;

•
Earnings per share;

•
Earnings, including earnings before or after interest, taxes, depreciation
and/or amortization, net earnings;

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•
Economic Value Added (“EVA®”);

•
Expense management;

•
Expense targets, including SG&A or other allocated or indirect costs;

•
Income measures, including net income (before or after taxes), operating income;

•
Market share;

•
Net operating profit;

•
Net sales growth;

•
Operating efficiency ratios, including days sales outstanding, accounts payable
to sales, inventory turns, working capital as a percent of sales;

•
Productivity ratios;

•
Profit margins, including gross margins, operating margins;

•
Return measures, including return on assets, return on net assets, return on
capital, return on investment, return on invested capital, return on total
capital, return on equity;

•
Revenues, sales, organic revenue, new business wins;

•
Stock price, including growth measures, total shareholder return; or

•
Such other measures as determined by the Committee.

In addition, Performance Measures may be based upon other objectives such as
negotiating transactions or sales and developing long-term goals. Unless
determined otherwise by the Committee, the Performance Measures shall be
objectively determinable and, to the extent that they are expressed in standard
accounting terms, shall be according to generally accepted accounting principles
as in existence on the date on which the applicable Performance Period is
established and without regard to any changes in such principles after such
date. For purposes of the Incentive Plan, unless determined otherwise by the
Committee, economic value added shall mean the amount of economic profit created
in excess of the amount required to satisfy the obligations to and normal
expectations of the Company’s lenders and investors.
 Unless determined otherwise by the Committee, the Committee shall establish the
performance targets (the “Performance Targets”) to be achieved which shall be
based on one or more Performance Measures relating to the Company as a whole or
to the specific businesses of the Company, subsidiaries, operating companies, or
operating units as determined by the Committee and shall be expressed as an
objective formula to be used in calculating the amount of bonus award each
executive shall be eligible to receive. There may be a sliding scale of payment
dependent upon the percentage levels of achievement of Performance Targets.
The Performance Measures and Performance Targets may be different with respect
to each executive and each Performance Period.  
5. CERTIFICATION OF PERFORMANCE TARGETS AND CALCULATION OF BONUS AWARDS
The Committee shall calculate the amount of each executive’s bonus for such
Performance Period based upon the Performance Measures and Performance Targets
for each executive. In establishing Performance Targets and Performance Measures
and in calculating the degree of achievement thereof, the Committee may include
or exclude, among other things, (a) asset write-downs, (b) litigation or claim
judgments or settlements, (c) the effect of changes in tax laws, accounting
principles, or other laws or provisions affecting reported results, (d) any
reorganization and restructuring programs, (e) any significant or unusual
infrequently occurring items as described in Accounting Standards Codification
225-20 and/or in management’s discussion and analysis of financial condition and
results of operations appearing in the Company’s annual report to shareholders
for the applicable year, (f) acquisitions or divestitures, and (g) foreign
exchange gains and losses. The Committee shall have authority and discretion to
increase or decrease the amount of any executive’s bonus as so determined, and
may totally eliminate any bonus award if it determines in its absolute and sole
discretion that such action is appropriate in order to reflect the executive’s
performance or unanticipated factors during the Performance Period.
6. PAYMENT OF AWARDS
Approved bonus awards shall be payable by the Company in cash to each executive,
or to the executive’s estate in the event of the executive’s death, as soon as
practicable (but not later than March 15 th) in the Plan Year following each
Performance Period.
If an executive is not an employee on the last day of the Performance Period,
the Committee shall have sole discretion to determine what portion, if any, the
executive shall be entitled to receive with respect to any award for the
Performance Period. The Committee shall have the authority to adopt appropriate
rules and regulations for the administration of the Incentive Plan in such
termination cases.

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The Company retains the right to deduct from any bonus awards paid under the
Incentive Plan any Federal, state, local or foreign taxes required by law to be
withheld with respect to such payment.
7. OTHER TERMS AND CONDITIONS
Any award made under this Incentive Plan shall be subject to the discretion of
the Committee. No person shall have any legal claim to be granted an award under
the Incentive Plan and the Committee shall have no obligation to treat
executives uniformly. Except as may be otherwise required by law, bonus awards
under the Incentive Plan shall not be subject in any manner to anticipation,
alienation, sale, transfer, assignment, pledge, encumbrance, charge,
garnishment, execution, or levy of any kind, either voluntary or involuntary.
Bonuses awarded under the Incentive Plan shall be payable from the general
assets of the Company, and no executive shall have any claim with respect to any
specific assets of the Company.
Nothing contained in the Incentive Plan shall give any executive the right to
continue in the employment of the Company or affect the right of the Company to
terminate an executive.  
8. ACCELERATION EVENT
An “Acceleration Event” shall occur if (i) a report on Schedule 13D shall be
filed with the Securities and Exchange Commission pursuant to Section 13(d) of
the Securities Exchange Act of 1934 (the “Act”) disclosing that any person
(within the meaning of Section 13(d) of the Act), other than the Company or a
subsidiary of the Company or any employee benefit plan sponsored by the Company
or a subsidiary of the Company, is the beneficial owner directly or indirectly
of thirty percent (30%) or more of the outstanding Common Stock, $0.01 par
value, of the Company (the “Stock”): (ii) any person (within the meaning of
Section 13(d) of the Act), other than the Company or a subsidiary of the
Company, or any employee benefit plan sponsored by the Company or a subsidiary
of the Company, shall purchase shares pursuant to a tender offer or exchange
offer to acquire any Stock of the Company (or securities convertible into Stock)
for cash, securities or any other consideration, provided that after
consummation of the offer, the person in question is the beneficial owner (as
such term is defined in Rule 13d-3 under the Act), directly or indirectly, of
thirty percent (30%) or more of the outstanding Stock of the Company (calculated
as provided in paragraph (d) of Rule 13d-3 under the Act in the case of rights
to acquire Stock); (iii) the consummation of (A) any consolidation, business
combination or merger involving the Company, other than a consolidation,
business combination or merger involving the Company in which holders of Stock
immediately prior to the consolidation, business combination or merger (x) hold
fifty percent (50%) or more of the combined voting power of the Company (or the
corporation resulting from the merger or consolidation or the parent of such
corporation) after the merger and (y) have the same proportionate ownership of
common stock of the Company (or the corporation resulting from the merger or
consolidation or the parent of such corporation), relative to other holders of
Stock immediately prior to the merger, business combination or consolidation,
immediately after the merger as immediately before, or (B) any sale, lease,
exchange or other transfer (in one transaction or a series of related
transactions) of all or substantially all the assets of the Company, (iv) there
shall have been a change in a majority of the members of the Board of Directors
of the Company within a 12-month period unless the election or
nomination for election by the Company’s stockholders of each new director
during such 12-month period was approved by the vote of two-thirds of the
directors then still in office who (x) were directors at the beginning of such
12-month period or (y) whose nomination for election or election as directors
was recommended or approved by a majority of the directors who were directors at
the beginning of such 12-month period or (v) any person (within the meaning of
Section 13(d) of the Act) (other than the Company or any subsidiary of the
Company or any employee benefit plan (or related trust) sponsored by the Company
or a subsidiary of the Company) becomes the beneficial owner (as such term is
defined in Rule 13d-3 under the Act) of thirty percent (30%) or more of the
Stock.
 Upon the occurrence of such Acceleration Event, the Performance Measures for
each Performance Period with respect to which bonuses may be payable under the
Incentive Plan shall be deemed to be achieved at the greater of (i) the
Performance Target established for such Performance Measures or (ii) the
Company’s actual achievement of such Performance Measures as of the Acceleration
Event. Payment of the bonuses, for the full year, will be made to each
Participating Executive, in cash, within five (5) business days following such
Acceleration Event.
9. SECTION 409A
It is intended that awards under the Incentive Plan will be exempt from
Section 409A of the Internal Revenue Code of 1986, as amended (the “Code”) as
“short-term deferrals” unless the Committee specifically determines otherwise,
and the Incentive Plan and the terms and conditions of all awards provided
hereunder shall be interpreted, construed and administered in accordance with
this intent. Notwithstanding anything to the contrary contained herein, neither
the Company nor any member of the Committee shall have any liability to any
participant if the Incentive Plan or any award hereunder is subject to
additional tax

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and/or penalties under Section 409A of the Code. To the extent applicable, the
Incentive Plan and any awards hereunder shall be interpreted in accordance with
Section 409A of the Code and Department of Treasury regulations and other
interpretive guidance issued thereunder. To the extent an award under the
Incentive Plan is determined to constitute deferred compensation subject to
Section 409A of the Code (i) if such award is payable as a result of the
participant’s termination of employment, the determination of whether the
participant has experienced a termination of employment will be determined
consistent with the rules relating to a “separation from service” as defined in
Section 409A of the Code and the regulations thereunder, (ii) if such award is
payable as a result of the participant’s termination of employment and the
participant is deemed at the time of such termination of employment to be a
“specified employee” under Section 409A of the Code, then such payment shall not
be made until the earlier of (a) the expiration of the 6-month period following
the participant’s separation from service or (b) the date of the participant’s
death, and (iii) such award will only be paid as a result of an Acceleration
Event to the extent the Acceleration Event is also an event described in Treas.
Reg. Section 1.409A-3(i)(5); provided, however, that, in each case, the
foregoing provisions in this sentence shall only be applicable to the extent
required to avoid imposition of taxes and penalties pursuant to Section 409A of
the Code.
10. CLAWBACK, REPAYMENT OR RECAPTURE POLICY

Notwithstanding anything to the contrary, to the extent allowed under applicable
law or regulatory filings, unless otherwise determined by the Committee, all
incentive awards granted under the Incentive Plan, and any related payments made
under the Incentive Plan, shall be subject to the requirements of any applicable
clawback, repayment or recapture policy implemented by the Company, including
any such policy adopted to comply with applicable law (including without
limitation the Dodd-Frank Wall Street Reform and Consumer Protection Act) or
securities exchange listing standards and any rules or regulations promulgated
thereunder, to the extent set forth in such policy and/or in any notice or
agreement relating to an incentive award or payment under the Incentive Plan.
11. MISCELLANEOUS
The Incentive Plan first became effective on September 27, 2014. The Incentive
Plan shall remain in effect unless/until terminated by the Board; provided,
however, that if an Acceleration Event has occurred no amendment or termination
shall impair the rights of any executive with respect to any prior award, unless
required by applicable law. This Incentive Plan shall be construed and governed
in accordance with the laws of the State of New York.