Exhibit 10.25


 


TETRA TECH, INC.


EXECUTIVE COMPENSATION PLAN


(As Adopted November 10, 2008)


 


1.                                      PURPOSE


 


The
purpose of the Executive Compensation Plan (the “Plan”) of Tetra Tech, Inc.
(the “Company”) is to (i) align the interests of the Company’s executive
officers with those of its stockholders; (ii) attract, motivate, reward
and retain top level executives upon whom, in large part, the success of the
Company depends; (iii) be competitive with compensation programs for
companies of similar size and complexity with whom the Company competes for
executive talent; (iv) provide compensation based upon the performance of
the Company; and (v) strengthen the relationship between pay and
performance by emphasizing variable, at-risk compensation that is dependent upon
the successful achievement of specified performance goals.  The Plan is designed with the intention that
the incentives paid hereunder to the executive officers of the Company (within
the meaning of Rule 3b-7 of the Securities Exchange Act of 1934, as amended)
(“Executive Officers”) are deductible under Section 162(m) of the
Internal Revenue Code of 1986, as amended, and the regulations and
interpretations promulgated thereunder (the “Code”).


 


2.                                      DEFINITIONS


 


The
following definitions shall be applicable throughout the Plan:


 


(a)                                  “Award” means the amount of a cash incentive
payable under the Plan to a Participant with respect to a Plan Year.


 


(b)                                 “Board” means the Board of Directors of the
Company, as constituted from time to time.


 


(c)                                  “Committee” means the Compensation Committee
of the Board or another Committee designated by the Board, provided that the
Committee shall at all times be comprised of not less than two directors
of the Company, each of whom shall qualify as an “outside director” for purposes
of Code Section 162(m) and Section 1.162-27(e)(3) of the
Regulations.


 


(d)                                 “Participant” means each Executive Officer of
the Company who is designated by the Committee as a participant for any Plan
Year.


 


(e)                                  “Plan Year” means each fiscal year of the Company.


 


3.                                      ADMINISTRATION


 


The
Plan shall be administered by the Committee, which shall have the discretionary
authority to interpret the provisions of the Plan, including all decisions
regarding eligibility to participate. 
The decisions of the Committee shall be final and 


 

















 


binding
on all parties making claims under the Plan. 
The Committee may delegate the authority to execute and deliver those
instruments and documents, to do all acts and things, and to take all other
steps deemed necessary, advisable or convenient for the effective
administration of the Plan in accordance with its terms and purposes; provided
however that the Committee may not delegate its responsibilities hereunder
where such delegation would jeopardize compliance with Code Section 162(m) and
Section 1.162-27(e) of the Regulations.


 


4.                                      ELIGIBILITY


 


The
Committee shall designate those Executive Officers of the Company that are
eligible to participate in the Plan for any Plan Year.  Designation of an Executive Officer as a
Participant in any Plan Year shall not require the Committee to designate such
person as a Participant in any other Plan Year. 
The Committee shall consider such factors as it deems pertinent in
designating Participants for any Plan Year.


 


5.                                      AWARDS


 


(a)                                  Participants.  Not
later than 90 days after the beginning of each Plan Year, the Committee will
identify the Participants in the Plan for that Plan Year.  If a Participant is initially employed by the
Company after the beginning of a Plan Year, the Committee may grant an Award to
that Participant with respect to a period of service following the Participant’s
date of hire, provided that no more than twenty-five percent (25%) of the Plan
Year has elapsed when the Committee grants the Award to such Participant for
such Plan Year and provided further that the performance objective for such
Plan Year otherwise satisfies the requirements of this Plan.  After the Committee designates an Executive
Officer as a Participant for a Plan Year, the Committee shall provide the
Participant with written notice of such participation and such other terms and
conditions as may be determined by the Committee in addition to those set forth
in this Plan.


 


(b)                                 Performance Objective(s).  The
Award payable to designated participants of the Plan for any Plan Year shall
not exceed (i) 2.5% of the Company’s Net Income for that Plan Year (as
defined below) in the case of the Company’s Chief Executive Officer (“CEO”);
and (ii) 1.25% of the Company’s Net Income for that Plan Year in the case
of any other Executive Officer participating in the Plan for such Plan
Year.  The Committee shall have
discretion to determine the conditions, restrictions or other limitations, in
accordance with and subject to the terms of this Plan and Code Section 162(m),
on the payment of Awards to Participants. 
To the extent permitted under Code Section 162(m), the Committee
reserves the right to reduce the amount payable under this Section 5(b) in
accordance with any standards contained in this Plan or on any other basis
(including the Committee’s discretion). 
Neither the Committee nor the Board shall have the authority under the
Plan to increase the amount payable under this Section 5(b).


 


(c)                                  Certification of Results. 
Before authorizing any Award payment under this Plan to a Participant,
the Committee must certify in writing (by resolution or otherwise) that the
payments are consistent with Section 5(b) above, and that any other 


 


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material
terms under the Plan for payment of the Award were satisfied.


 


(d)                                 Net Income.  For purposes of this Plan, “Net Income” means
the Company’s net income as set forth
in its audited financial statements. 
The Committee shall have the right to specify any adjustments that may
be taken into account in determining the Company’s Net Income for any Plan Year
including, but not limited to the following: 
(i) to exclude the dilutive effects of acquisitions or joint
ventures; (ii) to assume that any business divested by the Company
achieved performance objectives at targeted levels during the balance of a Plan
Year following such divestiture; (iii) to exclude restructuring and/or
other nonrecurring charges; (iv) to exclude the effects of changes to
generally accepted accounting standards required by the Financial Accounting
Standards Board; (v) to exclude the impact of any “extraordinary items” as
determined under generally accepted accounting principles; and (vi) to
exclude any other unusual, non-recurring gain or loss or other extraordinary
item; provided however that any such adjustments to Net Income for a Plan Year
must be specified by the Committee in writing not later than 90 days after the
beginning of such Plan Year.  To the
extent such inclusions or exclusions affect an Award under this Plan, they
shall be prescribed in a form that meets the requirements of Code Section 162(m) of
the Code for deductibility.


 


6.                                      PAYMENT OF AWARDS


 


(a)                                  Continued Employment. 
Unless otherwise determined by the Committee, a Participant must be
employed on the date the Award for a Plan Year is to be paid. The Committee may
make exceptions to this requirement in the case of retirement, death or
disability or under other circumstances, as determined by the Committee in its
sole discretion.


 


(b)                                 Payment.  Any payment made under the
Plan shall be in a lump sum in cash or other readily available funds, and shall
occur within a reasonable period of time after the end of the Plan Year to
which the Award relates.  Notwithstanding
the foregoing, in order to comply with the short-term deferral exception under
Code Section 409A, if the Committee waives the requirement that a
Participant must be employed on the date the Award is to be paid, payout shall
occur no later than the 15th day of the third month following the later of (i) the
end of the Company’s taxable year in which such requirement is waived or (ii) the
end of the calendar year in which such requirement is waived.


 


7.                                      GENERAL


 


(a)                                  Tax Withholding.  The
Company shall have the right to deduct from all Awards any federal, state or
local income and/or payroll taxes required by law to be withheld with respect
to such payments. The Company also may withhold from any other amount payable
by the Company or any affiliate to the Participant an amount equal to the taxes
required to be withheld from any Award.


 


(b)                                 Claim to Awards and Employment Rights. 
Nothing in the Plan shall confer on any Participant the right to
continued employment with the Company or any of 


 


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its
affiliates, or affect in any way the right of the Company or any affiliate to
terminate the Participant’s employment at any time, and for any reason, or
change the Participant’s responsibilities. Awards represent unfunded and
unsecured obligations of the Company and a holder of any right hereunder in
respect of any Award shall have no rights other than those of a general
unsecured creditor to the Company.


 


(c)                                  Beneficiaries.  To
the extent the Committee permits beneficiary designations, any payment of
Awards due under the Plan to a deceased Participant shall be paid to the
beneficiary duly designated by the Participant in accordance with the Company’s
practices. If no such beneficiary has been designated or survives the
Participant, payment shall be made to the Participant’s legal
representative.  A beneficiary
designation may be changed or revoked by a Participant at any time, provided
the change or revocation is filed with the Committee prior to the Participant’s
death.


 


(d)                                 Non-transferability.  A
person’s rights and interests under the Plan, including any Award previously
made to such person or any amounts payable under the Plan, may not be assigned,
pledged or transferred except, in the event of a Participant’s death, to a
designated beneficiary as provided in the Plan, or in the absence of such
designation, by will or the laws of descent and distribution.


 


(e)                                  Indemnification.  Each
person who is or shall have been a member of the Committee and each employee of
the Company or an affiliate who is delegated a duty under the Plan shall be
indemnified and held harmless by the Company from and against any loss, cost,
liability or expense that may be imposed upon or reasonably incurred by him in
connection with or resulting from any claim, action, suit or proceeding to which
he may be a party or in which he may be involved by reason of any action or
failure to act under the Plan and against and from any and all amounts paid by
him in satisfaction of judgment in any such action, suit or proceeding against
him, provided such loss, cost, liability or expense is not attributable to such
person’s willful misconduct. Any person seeking indemnification under this
provision shall give the Company prompt notice of any claim and shall give the
Company an opportunity, at its own expense, to handle and defend the same
before the person undertakes to handle and defend it on his own behalf. The
foregoing right of indemnification shall not be exclusive of any other rights
of indemnification to which such persons may be entitled under the Company’s
Certificate of Incorporation or Bylaws, as a matter of law, or otherwise, or
any power that the Company may have to indemnify them or hold them harmless.


 


(f)                                    Expenses.  The expenses of administering
the Plan shall be borne by the Company.


 


(g)                                 Pronouns.  Masculine pronouns and other
words of masculine gender shall refer to both men and women.


 


(h)                                 Titles and Headings.  The
titles and headings of the sections in the Plan are for convenience of
reference only, and in the event of any conflict, the text of the Plan, rather
than such titles or headings, shall control.


 


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(i)                                     Intent.  The intention of the Company
and the Committee is to administer the Plan in compliance with Code Section 162(m) so
that the Awards paid under the Plan to Participants who are or may become
subject to Code Section 162(m) will be treated as performance-based
compensation under Code Section 162(m)(4)(C). If any provision of the Plan
does not comply with the requirements of Code Section 162(m), then such
provision shall be construed or deemed amended to the extent necessary to
conform to such requirements. With respect to all other Participants, the Plan
may be operated without regard to the constraints of Code Section 162(m).


 


(j)                                     Governing Law.  The
validity, construction, and effect of the Plan, any rules and regulations
relating to the Plan, and any Award shall be determined in accordance with the
laws of the State of Delaware (without giving effect to principles of conflicts
of laws thereof) and applicable federal law. 
No Award made under the Plan shall be intended to be deferred
compensation under Code Section 409A and will be interpreted accordingly.


 


(k)                                  Amendments and Termination.  The
Committee may terminate the Plan at any time, provided such termination shall
not affect the payment of any Awards accrued under the Plan prior to the date
of the termination. The Committee may, at any time, or from time to time, amend
or suspend and, if suspended, reinstate, the Plan in whole or in part;
provided, however, that any amendment of the Plan shall be subject to the
approval of the Company’s stockholders to the extent required to comply with
the requirements of Code Section 162(m), or any other applicable laws,
regulations or rules.


 


(l)                                     Effective Date.  The
Plan shall be effective with respect to the operations of the Company for the
Plan Year beginning September 29, 2008, contingent upon approval by the
Company’s stockholders at its 2009 annual meeting.  In the event the stockholders do not approve
the Plan at its 2009 meeting, the Plan shall not be effective and no payments
will be made under the Plan.


 


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