**EXHIBIT 10.17**

 

**WASHINGTONGROUP INTERNATIONAL, INC.**

**EQUITY ANDPERFORMANCE INCENTIVE PLAN**

 

## **PERFORMANCE UNIT PARTICIPANTAGREEMENT**

 

This Agreement (the “Agreement”), dated as of                              ,is made by and between Washington Group International, Inc., a Delawarecorporation hereinafter referred to as “Corporation”, and                                                     ,an employee of the Corporation or Subsidiary of the Corporation, hereinafterreferred to as “Participant.”

 

WHEREAS, the Corporation wishes to afford theParticipant an opportunity to earn incentive compensation under the Corporation’sLong-Term Incentive Program (“LTIP”) by achieving objectives that are in thelong-term interest of the Corporation and its shareholders; and

 

WHEREAS, the Board may authorize the grantingof Performance Units under the Plan (as hereinafter defined), the terms ofwhich are hereby incorporated herein by reference and made a part hereof; and

 

WHEREAS, the Board has authorized the grantof Performance Units to the Participant by a resolution duly adopted on                                                 ,and incorporated herein by reference;

 

NOW, THEREFORE, in consideration of themutual covenants contained herein and other good and valuable consideration,receipt of which is hereby acknowledged, the parties hereto do agree asfollows:

 

#### **ARTICLE I**

 

#### **DEFINITIONS**

 

Wherever the following terms are used in thisAgreement with initial capital letters, they shall have the meanings specifiedin the Plan unless the context clearly indicates otherwise.

 

Section 1.1– Board

Section 1.2 – Change inControl

Section 1.3 – Code

Section 1.4 - CommonShares

Section 1.5 -Corporation

### Section 1.6– Management Objectives

### Section 1.7– Subsidiary

### Section 1.8– Years of Service

###  

Wherever the following terms are used in thisAgreement with initial capital letters, they shall have the meanings specifiedbelow unless the context clearly indicates otherwise.  The masculine pronoun shall include thefeminine and neuter, and the singular the plural, where the context soindicates.

 

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Section 1.9 - Beneficiary

 

“Beneficiary” means the person or personsproperly designated by the Participant to receive the Participant’s benefitsunder this Agreement in the event of the Participant’s death, or if theParticipant has not designated such person or persons, or such person orpersons shall all have pre-deceased the Participant,the executor, administrator, or personal representative of the Participant’sestate.  Designation, revocation, andredesignation of beneficiaries must be made in writing in accordance with rules establishedby the Corporation and shall be effective upon delivery to the Corporation.

 

Section 1.10 - Compensation Committee

 

“Compensation Committee” means the compensationcommittee of the Board, as constituted from time to time.

 

Section 1.11 – Par Value

 

“ParValue” means the value assigned to each Performance Unit at the time of grantand represents the amount that the Corporation will pay for each PerformanceUnit if the Corporation achieves 100% of its predetermined ManagementObjectives during the applicable Performance Period.

 

Section 1.12 – Performance Period

 

“PerformancePeriod” means the three-fiscal-year period of the Corporation commencing                                   ,and ending                                        ;provided, however, that the Performance Period may be shortened in the event ofa Change in Control as set forth in Section 4.4.

 

# **Section 1.13 – Performance Unit**

 

“Performance Unit” means a bookkeeping entrythat records a right to payment, the value of which is contingent uponperformance as measured against pre-determined Management Objectives over thePerformance Period.

 

Section 1.14 - Plan

 

“Plan” means the Washington Group International, Inc.Equity and Performance Incentive Plan, as the same may be amended or restatedfrom time to time.

 

## **ARTICLE II**

**AWARD OFPERFORMANCE UNITS**

 

# **Section 2.1 – Grant of Award**

 

In consideration of the Participant’sexecution of this Agreement and for other good and valuable consideration, onthe date hereof, the Corporation irrevocably awards to the Participant          Performance Units with a Par Value of $10.00 per unit, upon the terms andsubject to the conditions set forth in the Plan and in this Agreement.

 

Section 2.2 – Performance Measures

 

The Management Objectives that will be usedto determine the actual value of the Performance Units awarded under thisAgreement will be the Corporation’s average earnings per share (“EPS”) of

 

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Common Shares during thePerformance Period and the Corporation’s average return on invested capital (“ROIC”)during the Performance Period.  Aseparate target goal for each Management Objective (EPS and ROIC) has beenestablished for each year of the Performance Period.  These target goals are set forth on Exhibit Ato this Agreement.  The average EPS andthe average ROIC will be determined by calculating the percentage of the targetgoal achieved each year (i.e., dividing each year’s actual results for EPS andROIC by the respective target goal for that year) and then calculating theaverage of the percentages for all years in the Performance Period (i.e.,adding the percentages and dividing by the number of years in the PerformancePeriod).

 

*Example: *If Corporate ROIC equaled 100% of thetarget goal in [first year], 120% of the target goal in [second year] and 110%of the target goal in [third year], then the three-year average ROIC wouldequal 110%.

 

EPS for any year will be calculated bydividing net income (as defined for the Short-Term Incentive Plan) by theweighted average number of Common Shares outstanding during the year, excludingshares issued upon the exercise of warrants issued under the Company’s plan ofreorganization.

 

ROIC for any year will be calculated bydividing net income (as defined for the Short-Term Incentive Plan) + taxeffected interest expense by the average equity and debt (excluding cash inexcess of $50 million).

 

All amounts will be determined by theCorporation’s finance department and certified by the Compensation Committee.

 

# **Section 2.3 – Performance Unit Values**

 

At the end of the Performance Period, theCompensation Committee shall value each Performance Unit using the *Performance Unit Value Matrix*set forth in Exhibit Aand the Corporation’s actual results during the Performance Period.  Notwithstanding any other provision of thisAgreement or the Plan, no Performance Unit awarded under this Agreement mayhave a value greater than $20.00.  Forlevels of actual performance between any two amounts set forth on thePerformance Unit Value Matrix, the value of the Performance Units will becalculated by prorating between the values assigned to the specifiedperformance levels, giving equal weighting to each Management Objective.

 

## **ARTICLE III**

##  

# **Section 3.1 – Payment in Ordinary Course**

 

If the Participant remains actively employedwith the Corporation or a Subsidiary through the date of payment, the value ofthe Performance Units shall be paid to the Participant as soon asadministratively practical after the February Board meeting following theend of the Performance Period.  Paymentshall be in cash except that the Compensation Committee may determine in itsdiscretion to permit payment in the form of Common Shares or Deferred Shares oran election to receive Deferred Shares of the Corporation, subject toavailability under the Plan, to the extent necessary for the Participant tosatisfy any applicable stock ownership guidelines.

 

# **Section 3.2 – Payment in the Event orRetirement, Death or Disability**

 

Notwithstanding the foregoing, if, solelybecause of the Participant’s death, permanent and total disability (within themeaning of Section 22(c)(3) of the Code) or retirement at or afterthe attainment of (a) age 65, (b) age 55 with at least 10 Years ofService, or (c) 30 Years of Service, the Participant’s

 

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employment with the Corporationor a Subsidiary terminates before payment is made but at least 180 days afterthe Performance Units were granted, the Participant (or the Beneficiary in thecase of the Participant’s death) shall be entitled to receive a proratedportion of the value of the Performance Units as soon as administrativelypractical after the February Board Meeting following the end of thePerformance Period.  The amount that theParticipant (or Beneficiary) shall be entitled to receive shall be determinedby multiplying the value of the Performance Units by a fraction, the numeratorof which is the number of days during the Performance Period that theParticipant was employed by the Corporation or a Subsidiary and the denominatorof which is the total number of days in the Performance Period.

 

# **Section 3.3 – Taxes**

 

Any taxes required by federal, state or locallaws due on payment of the value of Performance Units will be withheld by theCorporation.  The Participant herebyauthorizes the necessary withholding by the Corporation to satisfy such taxwithholding obligations prior to payment.

 

## **ARTICLE IV**

## **OTHER PROVISIONS**

 

# **Section 4.1 – No Guarantee of Employment**

 

Nothing in this Agreement or in the Planshall confer upon the Participant any right to continue in the employ of theCorporation or any Subsidiary, or shall interfere with or restrict in any waythe rights of the Corporation or its Subsidiaries, which are expresslyreserved, to discharge the Participant at any time for any reason whatsoever,with or without cause.

 

Section 4.2 – Administration

 

The Board shall have the power to interpretthe Plan and this Agreement and to adopt such rules for theadministration, interpretation and application of the Plan as are consistenttherewith and to interpret, amend or revoke any such rules.  All actions taken and all interpretations anddeterminations made by the Board in good faith shall be final and binding uponthe Participant, the Corporation and all other interested persons.  No member of the Board shall be personallyliable for any action, determination or interpretation made in good faith withrespect to the Plan or a Performance Unit.

 

# **Section 4.3 – Performance Units NotTransferable**

 

PerformanceUnits under the Plan may not be sold, pledged,assigned or transferred in any manner other than by will or the laws of descentand distribution; provided, however, the Participant may designate aBeneficiary to receive payment after his death.  No Performance Unit or any interest or righttherein or part thereof shall be liable for the debts, contracts or engagementsof the Participant or his successors in interest or shall be subject todisposition by transfer, alienation, anticipation, pledge, encumbrance,assignment or any other means whether such disposition be voluntary orinvoluntary or by operation of law by judgment, levy, attachment, garnishmentor any other legal or equitable proceedings (including bankruptcy), and anyattempted disposition thereof shall be null and void and of no effect;provided, however, that this Section 4.3 shall not prevent transfer bywill or by the applicable laws of descent and distribution.  During the Participant’s lifetime, the valueof Performance Units shall be paid only to the Participant or his guardian orlegal representative.

 

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# **Section 4.4 – Change in Control**

 

The Performance Period shall end immediatelyupon the occurrence of a Change in Control and the value of each PerformanceUnit shall be equal to the greater of (a) the Par Value set forth in thisAgreement and (b) the value determined under Section 2.3 of thisAgreement based upon the Corporation’s actual results for the shortenedPerformance Period.  The value of thePerformance Units shall become payable immediately upon the Change in Control.

 

Section 4.5 – Amendment

 

This Agreement is subject to the Plan. TheBoard may amend the Plan and the Compensation Committee may amend thisAgreement at any time and in any way, except that any amendment of the Plan orthis Agreement that would impair the Participant’s rights under this Agreementmay not be made without the Participant’s written consent.

 

# **Section 4.6 – Notices**

# ** **

Anynotice to be given under the terms of this Agreement to the Corporation shallbe addressed to the Corporation in care of its Secretary, and any notice to begiven to the Participant shall be addressed to him or her at the address givenbeneath his or her signature hereto.  Bya notice given pursuant to this Section 4.6, either party may hereafterdesignate a different address for notices to be given to him or her.  Any notice which is required to be given tothe Participant shall, if the Participant is then deceased, be given to theParticipant’s personal representative if such representative has previouslyinformed the Corporation of his status and address by written notice under thisSection 4.6.  Any notice shall bedeemed duly given when enclosed in a properly sealed envelope or wrapperaddressed as aforesaid, deposited (with postage prepaid) in a post office orbranch post office regularly maintained by the United States Postal Service.

 

Section 4.7 – Titles

 

Titles are provided herein for convenienceonly and are not to serve as a basis for interpretation or construction of thisAgreement.

 

Section 4.8 – Governing Law

 

This Agreement shall be administered,interpreted and enforced under the internal substantive laws of the State ofDelaware.

 

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IN WITNESS WHEREOF, the Corporation, by its dulyauthorized officer, and the Participant have executed this Agreement.

 

 
|                                         | **WASHINGTON  GROUP INTERNATIONAL, INC**. |
|----------------------------------------------|-------------------------------------------|
|                                         |                                      |   |
|                                         |                                      |   |
|                                         | By:                                       |   |   |
|                                         |                                      | Larry L. Myers |
|                                         |                                      | Senior Vice President – Human Resources |
|                                         |                                      |   |
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|                                         |                                      |   |   |
|                                         |                                      |   |   |
| *Participant’s  Social Security Number* |                                      |   |   |
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|                                         |                                      |   |   |
|                                         |                                      |   |   |
| *Participant’s  Address*                |                                      |   |   |
|                                              |                                           |  |  |  |  |

 

**SpousalConsent**

 

The undersigned has read and is familiar with the preceding Agreementand the Plan and hereby consents and agrees to be bound by all the terms of theAgreement and the Plan.  Without limitingthe foregoing, the undersigned specifically agrees that the Corporation mayrely on any authorization, instruction or election made under the Agreement bythe Participant alone and that all of his or her right, title or interest, ifany, in the Performance Units, whether arising by operation of community propertylaw, by property settlement or otherwise, shall be subject to all such terms.

 

 
|         |                           |       |
|--------------|--------------------------------|------------|
| *** *** | ***Spouse’s  Signature*** | ** ** |
| ** **   | ** **                     | ** ** |
|         |                           |       |
|         | *Printed Name*                 |       |

 

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