EXHIBIT 10.1
URS CORPORATION
2006 Annual Incentive Compensation Plan summary
I.     Plan Objectives
     The URS Corporation Annual 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 URS Division and EG&G
Division (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.

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 objectives 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

     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 herein, 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 death, permanent disability or retirement, other
than the retirement of a Covered Employee (as defined in the Plan), the
Designated Participant (or their 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 objectives 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 the Plan
Year) who are identified as Designated Participants must have at least three
months of service and be employed by the Company at the end of a 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 objectives achieved.
Notwithstanding the foregoing, the terms of a Designated Participant’s
employment agreement will supersede the terms and conditions of the Plan.
     B.      Performance Objectives
     Each Plan Year, the Compensation Committee of the Board of Directors (the
“Committee”) establishes specific performance objectives for the Company and for
Designated Participants, including weightings of the performance objectives, by
the business unit or units in which the Designated Participant is expected to
have the

 

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most direct impact. The performance objectives may be based on any one, all or a
combination of the following (each as defined in the Plan):
     1.      Net Income;
     2.      Contribution;
     3.      Average Day Sales Outstanding;
     4.      Revenues; and/or
     5.      New Sales.
     In addition, the Committee has the discretion to adjust the performance
objectives by including or excluding the following events that may occur during
a Plan Year and that are objectively determinable and unrelated to the
achievement of the performance objectives:

     1.       Effects of changes in U.S. tax laws, generally accepted accounting
principles or other laws or provisions affecting the Company’s reported
financial results;

     2.       Extraordinary non-recurring items as described in Accounting
Principles Board Opinion No. 30 and/or in Management’s Discussion and Analysis
of Financial Condition and Results of Operations appearing in the Company’s
annual report to stockholders for a Plan Year; and

     3.       Effects of changes in capital structure, such as stock offering,
debt offering and debt restructure.

     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 vary from the target bonus pool depending on the
Company’s actual performance against the performance objectives established for
a Plan Year.
     D.      Target Bonus Percentage
     Each Plan Year, the Committee assigns each Designated Participant a target
bonus percentage, expressed as a percentage of salary, based on his or her
anticipated contributions to the Company.
III.     2006 Plan Year
     A.      Performance Objectives
     For the 2006 Plan Year, the Committee established as a prerequisite to all
bonus payments under the Plan that URS Corporation meets a minimum Net Income
threshold. In addition, the Committee established business unit performance
objectives and individual performance objectives for Designated Participants,
including weightings of the performance objectives, by the business unit where
the Designated Participant is expected to have the most direct impact as
follows:

            Name     Primary Performance Objective   Weight
URS Corporation
  Net Income   100%
URS Division
  URS Division Profit Contribution   100%
EG&G Division
  EG&G Division Profit Contribution   100%

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     In addition, for Designated Participants in the URS Division and the EG&G
Division, the Committee has established secondary individual performance
objectives consisting of Average Day Sales Outstanding, Safety Record, Revenues
and New Sales.
     B.      Target Bonus Pool
     For the 2006 Plan Year, the Committee established a target bonus pool which
will be funded based on achievement of the Company performance objectives as
follows:

            Performance Results     2006 Award Pool Funding
110%, 115% or 120% of Performance Objective, depending on the specific
Performance Objective
    200%  
100% of Performance Objective
    100%  
90% of Performance Objective
       0%  

     C.      Target Bonus Percentage
     For the 2006 Plan Year, the Committee has established the following target
bonus percentages for the Company’s executive officers:

        Name     2006 Target Bonus Percentage       (as a percentage of salary)
Martin M. Koffel   120% H. Thomas Hicks   75% Thomas W. Bishop   60% Reed N.
Brimhall   60% Gary V. Jandegian   75% Joseph Masters   65% Randall A. Wotring  
75% Susan B. Kilgannon   40%

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 Division achieving its minimum 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 percent of
his/her performance goal(s) achieved, multiplied by his/her target bonus
percentage and by his/her base salary earned during the Plan Year.
Determinations of awards to Non-designated Participants (from the discretionary
pool) will be made by 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 objectives 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. 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. 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.
     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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