Unassociated Document


    SECOND
      AMENDMENT TO THE

    EMPLOYMENT
      AGREEMENT

    BETWEEN

    FOSTER
      WHEELER LTD.

    AND

    RAYMOND
      J. MILCHOVICH

     

    THIS
      SECOND AMENDMENT (this “Amendment”) to the Employment Agreement between Foster
      Wheeler LTD., a Bermuda company (“Foster Wheeler”), and Raymond J.
      Milchovich (the “Executive”) dated as of August 11, 2006 (the “Employment
      Agreement”) is made and entered into as of February 27, 2007.

     

    WITNESSETH

     

    WHEREAS,
      Foster Wheeler and the Executive heretofore entered into the Employment
      Agreement and the First Amendment to the Employment Agreement, dated as of
      January 20, 2007; 

     

    WHEREAS,
      the parties each desire to further amend the Employment Agreement as set forth
      below.

     

    NOW
      THEREFORE, Foster Wheeler and the Executive hereby mutually agree to amend
      the
      Employment Agreement as follows:

     

    1. Section
      4.1 of the Agreement is hereby modified in its entirety as follows:

     

    4.1 General.
      Except
      as otherwise provided in this Section 4, following any termination of the
      Executive’s employment, the Company shall pay to, provide to, or allow the
      retention by, the Executive, or his estate or beneficiary, as the case may
      be,
      (i) Base Salary earned through the date of such termination; (ii) except in
      the
      case of a termination described in Section 4.4, any earned, but unpaid, annual
      cash incentive or other incentive awards; (iii) a payment representing the
      Executive’s accrued but unpaid vacation; (iv) any vested, but not forfeited,
      benefits on the date of such termination under the Company’s employee benefit
      plans in accordance with the terms of such plans; (v) the vested portion of
      his
      Restricted Stock and Options granted under Section 3.3 of this Agreement; and
      (vi) benefit continuation and conversion rights to which the Executive is
      entitled under the Company’s employee benefit plans and this Agreement.


     

    2. Section
      4.4 of the Agreement is hereby modified in its entirety as follows:

     

    4.4 For
      Cause.
      In
      addition to those payments and benefits described in clauses (i), (ii), (iii),
      (iv) and (vi) of Section 4.1, if the Company terminates the Executive’s
      employment for Cause, the Term shall terminate immediately and (i) the Executive
      shall be entitled to receive no further amounts or benefits hereunder, except
      as
      required by law; (ii) all unvested Options and Restricted Stock set forth in
      Section 3.3 herein shall be immediately forfeited; and (iii) all vested Options
      and Restricted Stock set forth in Section 3.3 herein which are not forfeited
      pursuant to clause (ii) of this sentence shall be forfeited on the date which
      is
      ninety (90) days following such termination. For purposes of this Agreement,
      “Cause”
shall
      mean the Executive (i) being convicted of, or pleading guilty or no contest
      to,
      a felony (except for motor vehicle violations); (ii) engaging in conduct that
      constitutes gross misconduct or fraud in connection with the performance of
      his
      duties to the Company; or (iii) materially breaching this Agreement which the
      Executive does not cure within thirty (30) days after the Company provides
      written notice of such breach to the Executive. 

     

    
      
         

      

      
         

        
          

        

      

      
         

      

    

     

    3. A
      new
      Section 4.9 is hereby added to the Agreement to read as follows:

     

    4.9 Without
      Good Reason.
      In
      addition to those payments and benefits described in Section 4.1, if during
      the
      Term the Executive voluntarily terminates his employment other than for Good
      Reason, the exercise period set forth in Section 5(e)(ii) of the Employee
      Nonqualified Stock Option Agreement issued to the Executive as of August 11,
      2006 (the “Option Agreement”), shall be extended to the maximum period permitted
      under Proposed Treasury Regulation Section 1.409A-5(v)(C) to allow the Executive
      to exercise any vested Option through the later of: (i) the 15th day of the
      third month following the date the Option would otherwise have expired, or
      (ii)
      December 31 of the year in which the Option would otherwise have expired. This
      Section 4.9 is intended to comply with Section 409A of the Internal Revenue
      Code
      and Proposed Treasury Regulation Section 1.409A-5(v)(C) to avoid treatment
      of
      the Option as deferred compensation thereunder, and shall be interpreted and
      operated in accordance with such laws as they may be amended or finalized.
      The
      Executive shall not voluntarily terminate his employment without Good Reason
      prior to the date which is thirty (30) days following the date on which the
      Executive provides written notice of such termination to the Company; provided,
      however, that the Company may waive such notice period in writing.

     

    4. A
      new
      Section 4.10 is hereby added to the Agreement to read as follows:

     

    4.10 Extension
      for Securities Laws Restrictions.
      In the
      event that on the last date on which an Option may be exercised under this
      Agreement or the Option Agreement, applicable law would preclude the Executive
      from exercising or selling such Option, then the expiration of the applicable
      exercise period under this Agreement and the Option Agreement shall be tolled
      and extended until the last trading day that is 30 days following the date
      upon
      which the exercise or sale of the Option would first no longer violate
      applicable laws. For the purpose of this section 4.10, applicable law shall
      be
      deemed to so preclude the Executive if, among other things, his legal counsel
      has advised him or the Company in writing that he is so precluded. This Section
      4.10 is intended to comply with Section 409A of the Internal Revenue Code and
      Proposed Treasury Regulation Section 1.409A-5(v)(C) to avoid treatment of the
      Option as deferred compensation thereunder, and shall be interpreted and
      operated in accordance with such laws as they may be amended or finalized.
      

     

    
      
         

      

      
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    5. A
      new
      Section 10.9 is hereby added to the Agreement to read as follows:

     

    10.9 The
      Executive agrees that Foster Wheeler’s Share Ownership Guidelines, adopted and
      effective November 6, 2006, apply to the Restricted Stock and Options (as well
      as any shares resulting from the exercise of the Options) awarded to him on
      August 11, 2006, notwithstanding any provision in the foregoing Guidelines
      to
      the contrary.

     

    6. For
      the
      avoidance of doubt, in the event of any inconsistency between the Option
      Agreement and this Amendment, this Amendment shall govern and
      control.

     

     

    IN
      WITNESS WHEREOF, Foster Wheeler and the Executive have executed this Second
      Amendment effective as of the date first written above.

    


     

    
      	
              FOSTER
                WHEELER LTD.

               

               

              By:
                /s/ Diane C.
                Creel                                      
                

              Name:
                Diane C. Creel

              Title:
                Chair of the Compensation Committee

            	
              RAYMOND
                J. MILCHOVICH

               

               

              /s/
                Raymond J.
                Milchovich                                
                

            


    

    


     

    
      
         

      

      
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