EXHIBIT 10.1 [form8-k.htm]
 
URS CORPORATION

Restated Incentive Compensation Plan
2010 Plan Year Summary
 
I.   Plan Objectives
 
The URS Corporation Restated Incentive Compensation Plan (the “Plan”) is
intended to provide rewards to individuals who make a significant contribution
to the financial performance of URS Corporation and its Infrastructure &
Environment, Federal Services, and Energy & Construction businesses
(collectively, the “Company”) during each fiscal year (a “Plan Year”).  Among
other things, the Plan is intended to:

·  
Help key employees to focus on achieving specific financial targets;

 
·  
Reinforce teamwork;

·  
Provide significant award potential for achieving outstanding performance; and

 
·  
Enhance the Company’s ability to attract and retain highly talented and
competent people.

 
This document is only a summary regarding the application of the Plan with
respect to the 2010 Plan Year.  For complete information regarding the Plan
(including defined terms not defined in this Summary document), participants
should refer to the Plan document.  Each Award provided by the Plan constitutes
a Performance Cash Award (as defined in the URS Corporation 2008 Equity
Incentive Plan, as amended from time to time (the “EIP”)) and will be governed
by the provisions of the EIP, the Plan, and any documents regarding the
application of the Plan with respect to a particular Plan Year (including this
summary).  In the event of any conflict between the provisions of the EIP, the
Plan and any such documents, the provisions of the EIP will control.  In the
event of any conflict between the provisions of the EIP, the Plan or any such
documents and the provisions of a Designated Participant’s employment agreement,
the provisions of the Designated Participant’s employment agreement will
control.
 
II.   General Plan Description
 
 
A.   Eligibility

 
The Plan provides an opportunity for employees to earn cash Awards based on
achievement of Company and individual Performance Goals during a Plan
Year.  Eligible participants are classified in one of two categories:

 
1.
“Designated Participants” are key employees who have the potential to
significantly impact the Company’s success; or

 
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2.
“Non-Designated Participants” are employees who demonstrate outstanding
individual effort and results during the year.  Awards to this group of
employees are paid from a discretionary bonus pool.

Except as noted in this paragraph, to be eligible to receive an Award under the
Plan, participants must be employed by the Company at the end of the Plan
Year.  However, if the employment of a Designated Participant is terminated
prior to the end of a Plan Year due to the Designated Participant’s death,
Disability or Retirement (as such terms are defined in the EIP), other than the
Retirement of a Covered Employee (as defined in the Plan), the Designated
Participant (or the Designated Participant’s heirs in the case of death) will be
eligible to receive a pro-rata Award based on the time the Designated
Participant was employed by the Company and the Performance Goals achieved.  If
a Designated Participant’s employment is terminated for any other reason prior
to the end of a Plan Year (whether voluntary or involuntary), the Designated
Participant will not receive an Award.

New hires (employees who join the Company during a Plan Year after the
Performance Goals for the Plan Year have been established) who are identified as
Designated Participants must have at least three months of service and be
employed by the Company at the end of the Plan Year to be eligible to receive a
pro-rata Award based on the time the Designated Participant was employed by the
Company and the Performance Goals achieved (except in the case of death,
Disability or Retirement, as described above).  New hires who are Covered
Employees are subject to certain additional requirements set forth in the
Plan.  Notwithstanding the foregoing, the terms of a Designated Participant’s
employment agreement will supersede the terms and conditions of the Plan.

Pursuant to the administrative authority provided to the Compensation Committee
of the Board of Directors (the “Committee”) under the Plan, the Committee has
determined that an employee who is identified as a Designated Participant for
the Plan Year after the Performance Goals for the Plan Year have been
established, but who joined the Company prior to the Plan Year, shall be treated
as a new hire for purposes of the Plan and shall be subject to the requirements
described above with respect to new hires.
 
 
B.   Performance Goals

 
Each Plan Year, the Committee establishes, or authorizes the establishment
within specified parameters of, specific Performance Goals for the Company and
for Designated Participants, including weightings of the Performance Goals, by
the business unit or units in which the Designated Participant is expected to
have the most direct impact.  The Performance Goals may be based on any one of,
or combination of, or any ratio between two or more of the Performance Criteria
set forth in the Plan, as they may be specifically defined by the Committee for
each Plan Year.

In addition, the Committee shall make appropriate adjustments in the method of
calculating the attainment of Performance Goals for the Plan Year, as authorized
under the EIP and set forth in the Plan.

 
 
 
 
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C.   Target Bonus Pool

 
Each Plan Year, the Committee identifies a Target Bonus Pool as part of the
Company’s financial planning process.  The Target Bonus Pool is the sum of all
anticipated Awards for Designated Participants and Non-Designated
Participants.  The Actual Bonus Pool may be greater or less than the Target
Bonus Pool depending on the Company’s actual performance relative to the
Performance Goals established for a Plan Year.
 
 
D.   Target Award Percentage

 
Each Plan Year, the Committee assigns to, or authorizes the assignment to, each
Designated Participant a Target Award Percentage, expressed as a percentage of
Base Salary, based on his or her anticipated contributions to the Company.
 
III.   2010 Plan Year
 
 
A.   Performance Criteria Definitions

 
The Committee selected and defined Performance Criteria as follows for the 2010
Plan Year for application to the Company-wide Performance Goals and the
Performance Goals established for the Section 16 Officers (as defined in the
Plan):

 
1.
Net Income.  “Net Income” shall mean the consolidated net income of the Company
for the 2010 fiscal year as determined under generally accepted accounting
principles, as adjusted for any material and objectively determinable impacts of
the items specified in the Plan that were not reflected in the 2010 financial
plan approved by the Board.  Net Income will be calculated after all bonuses are
accrued and assumed to have been paid in full.

 
 
2.
Profit Contribution.  “Profit Contribution” shall mean the operating income of
the business unit(s) for which a Designated Participant has accountability,
minus interest expense and noncontrolling interests attributable to the unit(s),
but before allocation of specified unit expenses, including stock compensation
expenses and  amortization of intangible assets.

 
The Committee also selected and defined additional Performance Criteria for the
2010 Plan Year for application to, in addition to or in lieu of the Performance
Criteria specified above, the Performance Goals established for Designated
Participants other than the Section 16 Officers, including the following:

 
3.
Average Day Sales Outstanding. “Average Day Sales Outstanding” shall mean the
average of the twelve (12) months of Day Sales Outstanding.  “Day Sales
Outstanding” or “DSOs” shall mean ninety (90) multiplied by a fraction, the
numerator of which is the sum of billed accounts receivable, net plus unbilled
accounts receivable, net minus billings in excess of cost, and the denominator
of which is the sum of the last three (3) months of revenues, with respect to
the business unit(s) for which a Designated Participant has
accountability.  DSOs shall be calculated monthly.

 

 
 
 
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4.
Working Capital Days Outstanding (WCDO).  “Working Capital Days Outstanding” or
“WCDO” shall mean the average of the four quarterly WCDOs with respect to the
business unit(s) for which a Designated Participant has accountability. The
quarterly WCDOs shall be calculated by dividing the average Working Capital of
the business unit(s) for the quarter (the sum of the Working Capital of the
business unit(s) at the end of each of the three months during the quarter
divided by 3) by the annualized daily Revenue for the business unit(s) (Revenue
for the business unit(s) during the quarter times 4 divided by 365).  Working
Capital is defined as current assets (excluding foreign cash, corporate
unrestricted cash and deferred taxes) less current liabilities (excluding costs
to complete, deferred taxes and the restructuring reserve).

 
 
5.
Revenues.  “Revenues” shall mean the consolidated revenue of the Company, or of
the relevant business unit(s) for which a Designated Participant has
accountability, as determined under generally accepted accounting principles.

 
 
6.
New Sales.  “New Sales” shall mean gross additions to backlog with respect to
the business unit(s) for which a Designated Participant has accountability.

 
 
7.
New Work Margin.  “New Work Margin” shall mean the margin target established by
the relevant business unit(s) for which a Designated Participant has
accountability for New Sales.  A volume hurdle will be established for those
units using this criteria.  This criteria excludes small change orders and
extensions on existing work.

 
 
8.
Safety Record.  “Safety Record” shall mean the total reportable incident rate as
defined by the Occupational Safety and Health Administration (OSHA).

 
 
B.   Performance Goals

 

For the 2010 Plan Year, the Committee established as a prerequisite to all bonus
payments under the Plan that the Company meet a minimum Net Income threshold.

In addition, the Committee established, or authorized the establishment of,
primary business unit Performance Goals and individual Performance Goals for
Designated Participants by the business unit where the Designated Participant is
expected to have the most direct impact as follows:
 
Business Unit
 
Performance Goals
URS Corporation
 
Net Income
Infrastructure & Environment
 
Infrastructure & Environment Profit Contribution
Federal Services
 
Federal Services Profit Contribution
Energy & Construction
 
Energy & Construction Profit Contribution

 
 
 
 
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In addition, for Designated Participants in the Infrastructure & Environment,
Federal Services, and Energy & Construction businesses the Committee
established, or authorized the establishment of, various secondary individual
Performance Goals consisting of Average Day Sales Outstanding, Working Capital
Days Outstanding, Safety Record, Revenues, New Sales, New Work Margin as well as
other Performance Goals set forth in the Plan, and established, or authorized
the establishment of, relative weighting to be allocated among all such
Performance Goals.
 
 
C.   Target Bonus Pool

 
For the 2010 Plan Year, the Committee established a Target Bonus Pool which will
be funded based on achievement of the Company and business unit(s) Performance
Goals as follows:
 
Performance Results
 
2010 Award Pool Funding
For URS Corporation and Federal Services:
     
115% of Performance Goal
   200%
100% of Performance Goal
   100%
85% of Performance Goal, or below
   0%
For Infrastructure & Environment:
   
115%, 120% or 125% of Performance Goal depending on the specific Performance
Goal and Designated Participant
    200%
100% of Performance Goal
    100%
85% of Performance Goal, or below
    0%
For Energy & Construction:
   
115% of Performance Goal
   150%
100% of Performance Goal
   100%
85% of Performance Goal
   50%
70% of Performance Goal, or below
   0%

 
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D.   Target Award Percentage

 
For the 2010 Plan Year, the Committee established the following Target Award
Percentages for the Company’s Section 16 Officers:
 
Name
2010 Target Award Percentage
(as a percentage of base salary)
Martin M. Koffel
125%
H. Thomas Hicks
100%
Thomas W. Bishop
75%
Reed N. Brimhall
75%
Gary V. Jandegian
100%
Joseph Masters
75%
Randall A. Wotring
100%
Susan B. Kilgannon
45%
Thomas Zarges
100%

 
IV.   Determination of Awards

 
Awards to Designated Participants will be dependent upon satisfying one or more
of the following criteria:  (1) the Company achieving its Net Income threshold;
(2) the business unit(s) achieving its minimum Profit Contribution threshold;
and (3) the Designated Participant achieving his/her individual Performance
Goal(s).

A Designated Participant’s Award will be calculated based on the percentage of
his/her Performance Goal(s) achieved, multiplied by his/her Target Award
Percentage and by his/her Base Salary earned during the Plan Year.  Pursuant to
the administrative authority provided to the Committee under the Plan, the
Committee has determined that a Designated Participant’s Base Salary for the
Plan Year shall (i) be interpreted to mean the Designated Participant’s Base
Salary for the calendar year corresponding to the Plan Year and (ii) any salary
changes which occur during the month of January of a calendar year will be
deemed to have occurred on January 1 of the calendar year.

As described above, certain Designated Participants (or a Designated
Participant’s heirs in the case of death) may be eligible to receive pro-rata
Awards.  Pursuant to the administrative authority provided to the Committee
under the Plan, the Committee has determined that for purposes of prorating
Awards under the Plan, any formula that incorporates a fraction where the
denominator is 365 days (or 12 months) shall be interpreted to mean a fraction
where the denominator is the actual number of days (or months) in the Plan Year.

Determinations of Awards to Non-Designated Participants (from the discretionary
pool) will be made by the Committee or the CEO at the end of a Plan Year.
 
 
 
 
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V.   Other Plan Provisions
 
 
A.   Payment of Awards

 

Assessment of actual performance and payout of Awards will be subject to
completion of the Company’s fiscal year-end independent audit and certification
by the Committee that the applicable Performance Goals and other material terms
of the Plan have been met.

The Actual Award earned will be paid to Designated Participants (or the
Designated Participant’s heirs in the case of death) in cash within 30 days
following completion of both the independent audit and the above-referenced
certification by the Committee.  Awards to Non-Designated Participants will be
paid concurrently to the extent practicable, but in any case within thirty (30)
days following the payment of Awards to Designated Participants.  Payroll and
other taxes will be withheld as required by law.
 
 
B.   Plan Accrual

 
Estimated payouts for the Plan will accrue monthly during each Plan Year.  At
the end of each fiscal quarter, the estimated Actual Awards for the Plan Year
will be evaluated based on actual performance to date and the monthly accrual
rate will be adjusted so that the cost of the Plan is fully accrued at Plan
Year-end.  Accrual of estimated payouts does not imply vesting of any individual
Awards to Designated Participants.
 
 
C.   Administration

 
The Plan will be administered by the Committee and the CEO, except that the
Committee retains final authority regarding all aspects of Plan administration,
the resolution of any disputes, and application of the Plan in any respect to a
Covered Employee.  The Committee may, without notice, amend, suspend or revoke
the Plan at any time.
 
 
D.   Assignment of Employee Rights

 
No employee has a claim or right to be a participant, to continue as a
participant or to be granted an Award under the Plan.  Participation in the Plan
does not give an employee the right to be retained in the employment of the
Company or its affiliates, nor does it imply or confer any other employment
rights.

Nothing contained in the Plan shall be construed to create a contract of
employment with any participant.  The Company and its Affiliates reserve the
right to elect any person to its offices and to remove any employees in any
manner and upon any basis permitted by law.

Nothing contained in the Plan shall be deemed to require the Company or its
Affiliates to deposit, invest or set aside amounts for the payment of any
Awards.  Participation in the Plan does not give a participant any ownership,
security or other rights in any assets of the Company or any of its Affiliates.
 
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E.   Validity

 
In the event that any provision of the Plan is held invalid, void or
unenforceable, such provision shall not affect, in any respect, the validity of
any other provision of the Plan.
 
 
F.   Governing Law

 
The Plan will be governed by, and construed in accordance with, the laws of the
State of California.

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