Exhibit 10.1


EMPLOYMENT AGREEMENT


This Employment Agreement (the “Agreement”)
is effective as of July 2, 2007 (the “Effective Date”), by and between Great
Lakes Dredge & Dock Corporation (the “Company”), and Douglas Mackie (the “Executive”).


WHEREAS, the Company currently employs the
Executive as its President and Chief Executive Officer, and the Company desires
to continue to employ the Executive as its President and Chief Executive
Officer; and


WHEREAS, the Company and the Executive have
reached agreement concerning the terms and conditions of his employment and
wish to formalize that agreement;


NOW, THEREFORE, in consideration of the
mutual terms, covenants and conditions stated in this Agreement, the Company
and the Executive hereby agree as follows:


1.             Employment.  The
Company hereby employs the Executive and the Executive hereby accepts employment with the Company as President and Chief Executive Officer.  During the Term (as hereinafter defined),
Executive will have the title, status and duties of President and Chief
Executive Officer and will report directly to the Company’s Board of
Directors.  The Executive’s
principal office will be at the principal executive offices of the Company in
Oak Brook, Illinois.


2.             Term of Employment. 
Unless sooner terminated by either party in accordance with the
provisions of this Agreement, the term of employment (“Term”) will commence on
the Effective Date, and will continue thereafter until the third one-year
anniversary of the Effective Date; provided that, on the third anniversary of
the Effective Date and on each subsequent annual anniversary thereafter (each,
an “Extension Date”), the Term will be automatically extended by twelve (12)
months, unless the Executive or the Company gives the other written notice at
least ninety (90) days in advance of an Extension Date that such automatic
renewal will cease.  Unless otherwise
provided in this Agreement or mutually agreed by the Company and the Executive,
all of the terms and conditions of this Agreement will continue in full force
and effect throughout the Term and, with respect to those terms and conditions
that apply after the Term, after the Term.


3.             Duties.  During the Term:


(a)           The
Executive will perform duties assigned by the Company’s Board of Directors (the
“Board”), from time to time; provided that the Executive will not be assigned
tasks inconsistent with those of President and Chief Executive Officer.


(b)           The
Executive will devote his full time and best efforts, talents, knowledge and
experience to serving as the Company’s President and Chief Executive
Officer.  However, the Executive may
devote reasonable time to activities such as supervision of personal
investments and activities involving professional, charitable, educational, religious
and similar types of activities, speaking engagements and membership on other
boards of directors, provided such activities do not interfere in any material
way with the business of the Company; provided that, the Executive cannot













serve on the board of directors of more than one publicly-traded
company without the Board’s written consent. 
The time involved in such activities will not be treated as vacation
time.  The Executive will be
entitled to keep any amounts
paid to him in connection with such activities (e.g., director fees and honoraria).


(c)           The
Executive will perform his duties diligently and competently and will act in
conformity with Company’s written and oral policies and within the limits,
budgets and business plans set by the Company. 
The Executive will at all times during the Term strictly adhere to and
obey all of the rules and regulations in effect from time to time relating to
the conduct of executives of the Company. 
Except as provided in (b) above, the Executive will not engage in
consulting work or any trade or business for his own account or for or on
behalf of any other person, firm or company that competes, conflicts or
interferes with the performance of his duties hereunder in any material way.


(d)           During
the Term, the Board will nominate the Executive for election as a member of the
Board and, at the expiration of each then-current term, re-election as a member
of the Board.  The Executive will serve
as a member of the Board without additional compensation.


(e)           The
Executive agrees to serve without additional compensation as an officer and
director of any of the Company’s subsidiaries and agrees that any amounts
received from such corporation may be offset against the amounts due hereunder.


4.             Compensation and Benefits.  During Executive’s employment hereunder,
Company will provide to Executive, and Executive will accept from Company as
full compensation for Executive’s services hereunder, compensation and benefits
as follows:


(a)           Base
Salary.  The Company will pay the
Executive at an annual base salary (“Base Salary”) of four hundred thirty two
thousand dollars ($432,000).  The Board,
or such committee of the Board as is responsible for setting the compensation
of senior executive officers, will review the Executive’s performance and Base
Salary annually in January of each year, and determine whether to adjust the
Executive’s Base Salary on a prospective basis. 
The first review will be in January 2008.  Such adjusted annual salary then will become
the Executive’s “Base Salary” for all purposes of this Agreement.  The
Executive’s annual Base Salary will not be reduced below the Base Salary then
in effect without the Executive’s consent. 
The Company will pay the Executive’s Base Salary according to payroll
practices in effect for all senior executive officers of the Company.


(b)           Incentive
Compensation.  The Executive will be
eligible to participate in any annual performance bonus plans and long-term
incentive plans established or maintained by the Company for its senior
executive officers, including, but not limited to, the Annual Cash Bonus Plan
or such similar or successor plans as the Company may establish.  Any bonus earned by the Executive will be
paid in accordance with the Company’s standard practice, but in any event no
later than 2.5 months after the end of the calendar year in which the
Eligibility Date occurs.



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(c)           Equity
Compensation.  The Executive will be
eligible to participate in any equity-based compensation plans established or
maintained by the Company for its senior executive officers.


(d)           Employee
Benefit Plans.  The Executive will be
eligible to participate on substantially the same basis as the Company’s other
senior executive officers in any employee benefit plans offered by the Company
including, without limitation, the Company’s 401(k) Lost Benefit Plan (or any
successor thereto), medical, dental, short-term and long-term disability, life,
pension, profit sharing and nonqualified deferred compensation
arrangements.  The Company reserves the
right to modify, suspend or discontinue any and all of the plans, practices,
policies and programs at any time without recourse by the Executive, so long as
Company takes such action generally with respect to other similarly situated
senior executive officers.


(e)           Business
Expenses.  The Company will reimburse
the Executive for all reasonable and necessary business expenses incurred in
the performance of services with the Company, according to Company’s policies
and upon Executive’s presentation of an itemized written statement and such
verification as the Company may require.


(f)            Vacation.  The Executive will be entitled to vacation in
accordance with the Company’s vacation policy for senior executive officers,
but in no event less than four (4) weeks per calendar year.  Unused vacation will be carried over for a
period not in excess of twelve (12) months.


5.             Payments on Termination of
Employment.


(a)           Termination of
Employment for any Reason.  The
Company will pay or provide the following upon the Executive’s termination of
employment for any reason:


(i)            Earned but unpaid
Base Salary through the date of termination;


(ii)           Any annual
incentive bonus, or other form of incentive compensation, for which the
performance measurement period has ended and the Executive has become eligible
in accordance with paragraph 4(b), but which is unpaid at the time of
termination;


(iii)          Any accrued but
unpaid vacation;


(iv)          Any amounts payable
under any of the Company’s executive benefit plans (other than any severance or
termination pay plan) in accordance with the terms of those plans, except as
may be required under Code Section 401(a)(13);


(v)           Unreimbursed
business expenses incurred by the Executive on the Company’s behalf; and


(vi)          Continued coverage
under the Company’s group health plan for the Executive until he becomes
eligible for Medicare coverage, and for the



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Executive’s
spouse until he becomes eligible for Medicare coverage; provided the Executive
pays the applicable COBRA rate for such continued coverage.


(b)           Voluntary
Termination of Employment for Other Than Good Reason.  In addition to the amounts determined under
paragraph 5(a) above, if the Executive voluntarily terminates employment for
other than Good Reason, then in addition to the amounts determined under (a)
above, the Executive will be entitled to a pro rata portion of the target bonus
under the Company’s annual incentive plan for the year in which such
termination occurs.


(c)           Termination of
Employment for Death or Disability. 
In addition to the amounts determined under paragraph 5(a) above, if the
Executive’s termination of employment occurs by reason of death or Disability,
the Executive (or his estate) will receive a pro rata portion of any bonus
payable under the Company’s annual incentive plan for the year in which such
termination occurs determined based on the highest of (i) the actual annual
bonus paid for the fiscal year immediately preceding such termination, (ii) the
target bonus for the fiscal year in which such termination occurs, or (iii) the
actual bonus attained for the fiscal year in which such termination
occurs.  For purposes of this Agreement, “Disability”
means the Executive’s long-term disability as defined under the Company’s
long-term disability plan, or if the Executive is not covered by a long-term
disability plan sponsored by the Company, the Executive’s inability to engage
in any substantial gainful activity by reason of any medically-determined
physical or mental impairment that can be expected to result in death or to be
of long-continued and indefinite duration.


(d)           Termination by
the Company Without Cause, or Voluntary Termination by the Executive for Good
Reason.  If the Company terminates
the Executive’s employment other than for Cause, or the Executive voluntarily
terminates his employment for Good Reason, in addition to the benefits payable
under paragraph 5(a), the Company will pay the following amounts and provide
the following benefits:


(i)            A lump sum amount
equal to two (2.0) multiplied by the sum of the Executive’s Base Salary and
Annual Bonus.  For this purpose, “Annual
Bonus” will be determined as the highest of (i) the actual bonus paid for the
fiscal year immediately preceding such termination, (ii) the target bonus (e.g., bonus equal to 100% of Base Salary) for the fiscal
year in which such termination occurs, or (iii) the actual bonus attained for
the fiscal year in which such termination occurs.


(ii)           Continued coverage
under the Company’s medical, dental, life, disability, 401(k), profit sharing
and other executive benefit plans through the 24 month anniversary of the date
that Executive’s employment was terminated, at the same cost to the Executive
as in effect on the date of the Executive’s termination.  If the Company determines that the Executive
cannot participate in any benefit plan because he is not actively performing
services for the Company, the Company may provide such benefits under an
alternate arrangement, such as through the purchase of an individual insurance
policy that provides similar benefits or, if applicable, through a nonqualified
pension or profit sharing plan.



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The
amount of such continued coverage will be determined, if applicable, by adding
24 additional months of age and service to the Executive’s actual age and
service as of the Executive’s termination date and as if the Executive earned compensation
during such 24-month period at the rate in effect during the 12-month period
immediately preceding her termination date. 
To the extent that the Executive’s compensation is necessary for
determining the amount of any such continued coverage or benefits, such
compensation (Base Salary and annual bonus) through the end of the Term will be
at the highest rate in effect during the 12-month period immediately preceding
the Executive’s termination of employment.


(iii)          Obtain professional
outplacement services for the Executive, at the Company’s expense, to be
performed by a nationally recognized outplacement firm selected by the
Executive.


(iv)          The 24-month period
of benefit continuation following the date of termination will count for
purposes of determining the Executive’s age and service with the Company with
respect to (A) eligibility, vesting and the amount of benefits under the
Company’s executive benefit plans, and (B) the vesting of any outstanding stock
options, restricted stock or other equity-based compensation awards.


Prior to receiving
any payment, coverage or benefit as provided in this paragraph 5(d), the
Executive will execute and deliver to the Company a valid General Release
Agreement in the form prepared by the Company. 
For purposes of this Agreement, delivery of a notice of non-renewal of
the Term by the Company will be considered a termination without Cause
effective as of the date that the Term expires as a result of the notice of
non-renewal.


(e)           Good Reason.  For purposes of this Agreement, “Good Reason” will mean
the occurrence of any of the following without the Executive’s consent:  (i) a material reduction or a material
adverse alteration in the nature of the Executive’s position, responsibilities
or authorities or the assigning duties to the Executive that are materially
inconsistent with those of the position of President and Chief Executive
Officer for similar companies in similar industries; (ii) the Executive’s
becoming the holder of a lesser office or title than that previously held or
requiring the Executive to report to other than the Company’s Board; (iii)
any material breach of this Agreement by the Company which causes an adverse
change to the terms and conditions of the Executive’s employment; (iv) the
Company requires the Executive to relocate his principal business office to a location not within fifty (50) miles of the
Company’s principal business office located in Oak Brook, Illinois; (v) any
reduction in the aggregate of the Executive’s bonus opportunity, salary and
benefits, other than a reduction in bonus opportunity or benefits generally
applicable to executive employees, or (vi) any failure to nominate or elect the
Executive as Chief Executive Officer of the Company and as a Director of the
Company’s Board.  In no event will a
resignation be deemed to occur for “Good Reason” unless the Executive provides
notice to the Company, and such resignation occurs, within 90 days after the
event or condition giving rise thereto. 
Upon receiving notice from the



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Executive,
the Company shall have a period of thirty (30) days during which it may remedy
the event or condition.


(f)            Cause.  For purposes of this Agreement, “Cause” will mean:  (i) the Executive’s willful and continued failure to
substantially perform his material duties as an executive of the Company (other than any such failure resulting from
incapacity due to physical or mental illness) after a written demand for
substantial performance is delivered to the Executive by the Board, (ii) the
Executive’s willful misconduct, which is demonstrably and materially injurious
to the Company, monetarily or otherwise, (iii) the Executive’s engaging in
egregious misconduct involving serious moral turpitude to the extent that his
creditability and reputation no longer conforms to the standard of senior
executive officers of the Company (iv) the Executive’s conviction of, or plea
of guilty or nolo contendere to, a felony, (v) the Executive’s material breach
of a material written policy of the Company, (vi) the Executive’s failure to
reasonably cooperate with any audit or investigation involving the Company or
its business practices; or (vii) the Executive’s material breach of this
Agreement.  The Board must give the
Executive at least thirty (30) days written notice of its intent to terminate
him for Cause, specifying the act(s) or omission(s) alleged to justify the for
Cause termination, and an opportunity to cure such act(s) or omission(s), where
feasible, within the thirty (30) day period. 
In addition, the Executive’s employment will be deemed to have
terminated for Cause if, after the Executive’s employment has terminated, facts
and circumstances are discovered that would have justified a termination for
Cause.  For purposes of this Agreement,
no act or failure to act on the Executive’s part will be considered “knowing”
or “willful” unless it is done, or omitted to be done, by him in bad faith or
without reasonable belief that his action or omission was in the best interests
of the Company.  Any act, or failure to
act, based upon authority given pursuant to a resolution duly of the Board or
based upon the advice of counsel for the Company will be conclusively presumed
to be done, or omitted to be done, in good faith and in the best interests of
the Company.  In no event will a termination
be deemed to occur for “Cause” unless such termination occurs within 90 days
after the Board becomes aware of the circumstance or event giving rise thereto.


(g)           Timing of
Payments.  All payments described
above will be made in a lump sum cash payment as soon as practicable (but in no
event more than 10 days) following the Executive’s termination of employment or
in the case of the portion of any payment attributable to the Annual Bonus
pursuant to paragraph 5(d)(i) within 10 days after the Annual Bonus is
determined; provided that the portion payments pursuant to paragraph
5(d)(i) that are attributable to salary will be paid in equal installments
during the 24 month period after termination in accordance with the Company’s
normal payroll practices.


(h)           Removal from any
Boards and Positions.  If the
Executive’s employment is terminated for any reason under this Agreement, this
Agreement will constitute his resignation from (i) if a member, the Board or
board of directors of any Affiliate or any other board to which he has been
appointed or nominated by or on behalf of the Company, (ii) any position with
the Company or any Affiliate, including, but not limited to, as an officer of
the Company or any of its Affiliates, and (iii) any fiduciary positions with
respect to the Company’s benefit plans.



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6.             Change in Control.


(a)           Payments and
Benefits Upon Termination After a Change in Control.  If within two years after a Change in Control
(as defined below), the Company terminates the Executive’s employment other
than for Cause, or the Executive voluntarily terminates his employment for Good
Reason, the Company will provide the following payments and benefits to the
Executive, in lieu of those payments and benefits provided under paragraphs
5(c) or (d) above, but in addition to the amounts payable under paragraph 5(a)
above:


(i)            Two
and one-half (2.5) multiplied by the Executive’s Base Salary as in effect on
the date of the Executive’s termination of employment.


(ii)           Two
and one-half (2.5) multiplied by the Annual Bonus.


(iii)          Continued
coverage for a period of 30 months from the Executive’s termination under the
Company’s medical, dental, life, disability, 401(k), profit sharing, and other
executive benefit plans, at the same cost to the Executive as in effect on the
date of the Change in Control (or, if lower, as in effect at any time
thereafter).  If the Company determines
that the Executive cannot participate in any benefit plan because he is not
actively performing services for the Company, the Company may provide such
benefits under an alternate arrangement, such as through the purchase of an
individual insurance policy that provides similar benefits or, if applicable,
through a nonqualified pension or profit sharing plan.  The amount of such continued coverage will be
determined, if applicable, by adding 30 additional months of age and service to
the Executive’s actual age and service as of the Executive’s termination date
and as if the Executive earned compensation during such 30-month period at the
rate in effect during the 12-month period immediately preceding his termination
date.  The Executive’s eligibility for
any retiree medical or life coverage following such termination date will also
be determined by adding 30 additional months of age and service to the
Executive’s actual age and service as of the termination date.


(iv)          Obtain
professional outplacement services for the Executive, at the Company’s expense,
to be performed by a nationally recognized outplacement firm selected by the
Executive.


(v)           The
24-month period of benefit continuation following the date of termination will
count for purposes of determining the Executive’s age and service with the Company
with respect to (A) eligibility, vesting and the amount of benefits under the
Company’s executive benefit plans, and (B) the vesting of any outstanding stock
options, restricted stock or other equity-based compensation awards.


(b)           Timing of Payment.  All payments under paragraphs (a)(i), (ii)
and (iv) above, and paragraph (c) below, will be made in a lump sum cash
payment as soon as practicable, but in no event more than 10 days after the
Executive’s termination of employment (or the date of the Change in Control, if
applicable).  If the total amount of 



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bonus
is not determinable on that date, the Company will pay the amount of bonus that
is determinable, and will pay the remainder in a lump sum cash payment within
10 days of the date that annual performance results are finalized.


(c)           [Intentionally Omitted]


(d)           Definition of
Change in Control.  For purposes of
the Agreement, a “Change in Control” of the Company will be deemed to occur as
of the first day that any one or more of the following conditions is satisfied:


(i)            The
“beneficial ownership” (as defined in Rule 13d-3 under the Securities Exchange
Act of 1934, as amended (the “Exchange Act”)) of securities representing more
than twenty-five percent (25%) of the combined voting power of the then
outstanding voting securities of the Company entitled to vote generally in the
election of directors (the “Company Voting Securities”) is accumulated, held or
acquired by a Person (as defined in Section 3(a)(9) of the Exchange Act, as
modified, and used in Sections 13(d) and 14(d) thereof) (other than the
Company, any trustee or other fiduciary holding securities under an employee
benefit plan of the Company, holders of capital stock of the Company as of the
date hereof or an affiliate thereof, any corporation owned, directly or
indirectly, by the Company’s stockholders in substantially the same proportions
as their ownership of stock of the Company); provided, however that any
acquisition from the Company or any acquisition pursuant to a transaction that
complies with clauses (A), (B) and (C) of subparagraph (iii) of this paragraph
will not be a Change in Control under this subparagraph (i), and provided
further, that immediately prior to such accumulation, holding or acquisition,
such Person was not a direct or indirect beneficial owner of twenty-five
percent (25%) or more of the Company Voting Securities; or


(ii)           Individuals
who, as of the date of the Agreement, constitute the Board (the “Incumbent
Board”) cease for any reason to constitute at least a majority of the Board;
provided, however, that any individual becoming a director subsequent to the
date hereof whose election, or nomination for election by the Company’s
stockholders, was approved by a vote of at least a majority of the directors
then comprising the Incumbent Board will be considered as though such
individual were a member of the Incumbent Board, but excluding, for this
purpose, any such individual whose initial assumption of office occurs as a
result of an actual or threatened election contest with respect to the election
or removal of directors or other actual or threatened solicitation of proxies
or consents by or on behalf of a Person other than the Board of Directors; or


(iii)          Consummation
by the Company of a reorganization, merger or consolidation, or sale or other
disposition of all or substantially all of the assets of the Company or the
acquisition of assets or stock of another entity (a “Business Combination”), in
each case, unless immediately following such Business Combination:  (A) more than 60% of the combined voting
power of then outstanding voting securities entitled to vote generally in the
election of directors of (x) the corporation resulting from such Business
Combination (the “Surviving



 8
 









Corporation”), or (y) if applicable, a corporation that as a result of
such transaction owns the Company or all or substantially all of the Company’s
assets either directly or through one or more subsidiaries (the “Parent
Corporation”), is represented, directly or indirectly by Company Voting
Securities outstanding immediately prior to such Business Combination (or, if
applicable, is represented by shares into which such Company Voting Securities
were converted pursuant to such Business Combination), and such voting power
among the holders thereof is in substantially the same proportions as their
ownership, immediately prior to such Business Combination, of the Company
Voting Securities, (B) no Person (excluding any employee benefit plan (or
related trust) of the Company or such corporation resulting from such Business
Combination) beneficially owns, directly or indirectly, 20% or more of the combined
voting power of the then outstanding voting securities eligible to elect
directors of the Parent Corporation (or, if there is no Parent Corporation, the
Surviving Corporation) except to the extent that such ownership of the Company
existed prior to the Business Combination and (C) at least a majority of the
members of the board of directors of the Parent Corporation (or, if there is no
Parent Corporation, the Surviving Corporation) were members of the Incumbent
Board at the time of the execution of the initial agreement, or of the action
of the Board, providing for such Business Combination; or


(iv)          Approval
by the Company’s stockholders of a complete liquidation or dissolution of the
Company.


However, in no event will a Change in Control be deemed to have
occurred, with respect to the Executive, if the Executive is part of a
purchasing group that consummates the Change in Control transaction.  The Executive will be deemed “part of a
purchasing group” for purposes of the preceding sentence if the Executive is an
equity participant in the purchasing company or group (except:  (i) passive ownership of less than two
percent (2%) of the stock of the purchasing company; or (ii) ownership of
equity participation in the purchasing company or group that is otherwise not
significant, as determined prior to the Change in Control by a majority of the
nonemployee continuing Directors; provided that, for purposes of the
foregoing, participation as a management investor in such purchasing company
will not be deemed to be within the exceptions provided for in (i) and (ii)).


(e)           General Release.  Prior to receiving any payment, coverage or
benefit as provided in this Section 6, the Executive will execute and deliver
to the Company a valid General Release Agreement in the form prepared by the
Company and delivered to the Executive within five (5) business days of the
Executive’s termination of employment.


7.             Nondisclosure of Confidential Information; Non-Competition.


(a)           The Executive will
not, without the prior written consent of the Company, divulge, disclose or
make accessible to any other person, firm, partnership, corporation or other entity any Confidential Information
pertaining to the business of the Company, except (i) while employed by the
Company, in the business of and for the benefit of the Company, or (ii) when
required to do so by a court of competent jurisdiction or an



 9
 









individual
duly appointed thereby, by any administrative body or legislative body
(including a committee thereof) having supervisory authority over the business
of the Company, or by any administrative body or legislative body (including a
committee thereof) with jurisdiction to order the Executive to divulge,
disclose or make accessible such information. 
For purposes of this paragraph 7(a), “Confidential Information” will
mean non-public information concerning the financial data, strategic business
plans, product development (or other proprietary product data), customer lists,
marketing plans and other non-public, proprietary and confidential information
of the Company and its subsidiaries that is not otherwise available to the
public; provided, however, that Confidential Information will also include any
information of the type herein described which has become publicly available
through any breach of fiduciary duty.


(b)           During the period of his employment hereunder and for a period
of 24 months thereafter (or, if such termination, arises in circumstances where
Executive is entitled to payments pursuant to paragraph 6(a) hereof, during the
period of his employment hereunder and for a period of 30 months thereafter),
the Executive agrees that, without the prior written consent of the Company, he
will not, directly or indirectly, either as principal, manager, agent,
consultant, officer, stockholder, partner, investor, lender or employee or in
any other capacity, carry on, be engaged in or have any financial interest in,
any business which is in material competition with the business of the Company
and/or its affiliates.


(c)           For purposes of this
Section 7, a business will be deemed to be in competition with the Company if
it is principally involved in the purchase, sale or other dealing in any
property or  the rendering of any service
purchased, sold, dealt in or rendered by the Company and/or its affiliates as a
material part of the business of the Company and/or its affiliates within the
same geographic areas in which the Company and/or its affiliates principally
effect such purchases, sales or dealings or render such services.  Nothing in this Section 7 will be construed
so as to preclude the Executive from (i) investing in any publicly held company
provided Executive’s beneficial ownership of any class of such company’s
securities does not exceed 3% of the outstanding securities of such class.


(d)           The Executive and
the Company agree that this covenant not to compete is a reasonable covenant
under the circumstances, and further agree that if in the opinion of any court
of competent jurisdiction such restraint is not reasonable in any respect, such
court will have the right, power and authority to excise or modify such
provision or provisions of this covenant as to the court will appear not
reasonable and to enforce the remainder of the covenant as so amended.  Executive agrees that any breach of the covenants
contained in this Section 7 would irreparably injure the Company.  Accordingly, the Company may, in addition to
pursuing any other remedies it may have in law or in equity, obtain an
injunction against Executive from any court having jurisdiction over the
matter, restraining any further violation of this Agreement by the Executive.


(e)           Survival.  The provisions set forth in this Section
will, as noted, survive termination of this Agreement.



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8.             Indemnification and Insurance.  The
Company will indemnify the Executive in accordance with the Company’s
Certificate of Incorporation and Bylaws in the event he is made or threatened
to be made a party to any action, suit, or proceeding, whether criminal, civil,
administrative or investigative, by reason of the fact that he is or was a
director, officer, or employee of the Company and its Affiliates, or serves any
other enterprise as a director, officer, or employee at the request of the
Company.  While employed by the Company
and Affiliates and for six years thereafter, the Company will maintain the
Executive as an insured party on all directors’ and officers’ insurance
maintained by the Company for the benefit of its directors and officers on at
least the same basis as all other covered individuals with respect to time
periods where Executive served as an employee of the Company and its
Affiliates; provided that, for the avoidance of doubt, the Company will
be entitled to satisfy its obligations pursuant to this sentence through
purchase of a “tail policy” that includes Executive’s employment with the
Company and its Subsidiaries.


9.             Section 409A. 
Payments under Sections 5 and 6 are intended to qualify as short-term
deferrals.  However, if the Company
reasonably determines that a payment under paragraphs 5(d) or 6(a) above does
not qualify as a short-term deferral under Code Section 409A and Treas. Reg.
§1.409A-1(b)(4) (or any similar or successor provisions), and the Executive is
a Specified Employee as of the date of termination, distributions to the Executive
may not be made before the date that is six months after the date of the date
of termination or, if earlier, the date of the Executive’s death (the “Six-Month
Delay Rule”).  Payments to which the
Executive would otherwise be entitled during the first six months following the
date of termination (the “Six-Month Delay”) will be accumulated and paid on the
first day of the seventh month following the date of termination.  Notwithstanding the Six-Month Delay Rule set
forth in Section 9:


(a)           To the maximum extent permitted under
Code Section 409A and Treas. Reg. §1.409A-1(b)(9)(iii) (or any similar or
successor provisions), during the first month of the Six-Month Delay, the
Company will pay the Executive an amount equal to the lesser of (i) the total
lump sum severance provided under paragraphs 5(d) or 6(a) above, or (ii) two
times the lesser of (A) the maximum amount that may be taken into account under
a qualified plan pursuant to Code Section 401(a)(17) for the year in which the
date of termination occurs, and (B) the sum of the Executive’s annualized
compensation based upon the annual rate of pay for services provided to the
Company for the taxable year of the Executive preceding the taxable year of the
Executive in which the Executive’s date of termination occurs (adjusted for any
increase during that year that was expected to continue indefinitely if the
Executive had not had a date of termination); provided that amounts paid under
this sentence will count toward, and will not be in addition to, the total payment
amount required to be made to the Executive by the Company under paragraph 5(d)
or 6(a) above.


(b)           To the maximum extent permitted under
Code Section 409A and Treas. Reg. §1.409A-1(b)(9)(v)(D) (or any similar or
successor provisions), within ten (10)-days of the date of termination, the
Company will pay the Executive an amount equal to the applicable dollar amount
under Code Section 402(g)(1)(B) for the year in which the date of termination
occurs; provided that the amount paid under this sentence will count toward,
and will not be in addition to, the total payment amount required to be made to
the Executive by the Company under paragraph 5(d) or 6(a).



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(c)           In the event that the Company’s
independent registered public accounting firm or the Internal Revenue Service
determines that any payment, coverage or benefit due or owing to the Executive
pursuant to this Agreement is subject to the excise tax imposed by Code Section
409A or any successor provision thereof or any interest or penalties, including
interest imposed under Code Section 409(A)(1)(B)(i)(I), incurred by the
Executive as a result of the application of such provision, the Company agrees
to cooperate with Executive to execute any amendment to the provisions hereof
reasonably necessary but only (i) to the minimum extent necessary to avoid
application of such tax and (ii) to the extent that the Company would not, as a
result, suffer any adverse consequences (including, without limitation,
accelerating the payment or provision of any benefit described herein).


For
purposes of this Agreement, “Specified Employee” has the meaning given that
term in Code Section 409A and Treas. Reg. 1.409A-1(c)(i) (or any similar or
successor provisions).  The Company’s “specified
employee identification date” (as described in Treas. Reg. 1.409A-1(c)(i)(3))
will be December 31 of each year, and the Company’s “specified employee
effective date” (as described in Treas. Reg. 1.409A-1(c)(i)(4) or any similar
or successor provisions) will be February 1 of each succeeding year.


10.           Miscellaneous.


(a)           Assignment;
Successors.  This Agreement
will be binding upon and inure to the benefit of the heirs and representatives
of Executive and the assigns and successors of the Company, but neither this
Agreement nor any rights hereunder will be assignable or otherwise subject to
hypothecation by Executive (except by will or by operation of the laws of
intestate succession) or by the Company, except that the Company may assign
this Agreement to any successor (whether by merger, purchase or otherwise) to
all or substantially all of the stock, assets or businesses of the Company.


(b)           Interpretation
and Forum for Disputes.  The laws of the State of Illinois will govern
the validity, interpretation, construction and performance of this Agreement,
without regard to the conflict of laws principles thereof.  Any action or proceeding against the parties
relating in any way to this Agreement or the Executive’s employment (a “Dispute”)
must be brought and enforced in the courts of Cook County, Illinois or the
Northern District of Illinois, and the parties irrevocably (i) submit to the
jurisdiction of such courts in respect of any such action or proceeding and
(ii) waive any right to a trial by jury of any Dispute.


(c)           Withholding.  The
Company may withhold from any payment that it is required to make under this
Agreement amounts sufficient to satisfy applicable withholding requirements
under any federal, state or local law.


(d)           Amendment
or Termination.  This Agreement may be amended at any time by
written agreement between the Company and the Executive.


(e)           Notices. 
Notices given pursuant to this Agreement will be in writing and will be
deemed received when personally delivered, or on the date of written
confirmation of receipt by (i) overnight carrier, (ii) telecopy, (iii)
registered or certified



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mail, return receipt requested, addressee only, postage prepaid, or (iv) such
other method of delivery that provides a written confirmation of delivery.  Notice to the Company will be directed to:


Great Lakes Dredge & Dock Corporation


2122 York Road


Oak Brook, Illinois  60523


Attention:
General Counsel


The Company may change the person and/or address to whom the Executive
must give notice under this paragraph by giving the Executive written notice of
such change, in accordance with the procedures described above.  Notices to or with respect to the Executive
will be directed to the Executive, or to the Executive’s executors, personal
representatives or distributees, if the Executive is deceased, or the assignees
of the Executive, at the Executive’s home address on the records of the
Company.


(f)            Severability.  If
any provisions of this Agreement will be found invalid or unenforceable by a court of competent
jurisdiction, in whole or in part, then it is the parties’ mutual desire that
such court modify such provision(s) to the extent and in the manner necessary
to render the same valid and enforceable, and this Agreement will be construed
and enforced to the maximum extent permitted by law, as if such provision(s)
had been originally incorporated herein as so modified or restricted, or as if
such provision(s) had not been originally incorporated herein, as the case may
be.


(g)           Entire
Agreement.  This
Agreement sets forth the entire agreement and understanding between the Company
and the Executive and supersedes all prior agreements and understandings,
written or oral, relating to the subject matter hereof, including the
Employment Agreement made as of January 1, 1992, by and between  the Executive and Great Lakes Holdings
Corporation.  Nothing in this Agreement will limit or amend
any rights or obligations of Executive under the Company’s Management Equity
Agreement.


(h)           No
Waiver.  No failure or delay by the Company or the
Executive in enforcing or exercising any right or remedy hereunder will operate
as a waiver thereof.  No modification,
amendment or waiver of this Agreement or consent to any departure by the
Executive from any of the terms or conditions thereof, will be effective unless
in writing and signed by the Chairman of the Company’s Board.  Any such waiver or consent will be effective
only in the specific instance and for the purpose for which given.


(i)            Effect
on Other Obligations. 
Payments and benefits herein provided to be paid to the Executive by the
Company will be made without regard to and in addition to any other payments or
benefits required to be paid the Executive at any time hereafter under the
terms of any other agreement between the Executive and the Company (it being
understood and agreed that the Executive will not be entitled to severance or
termination benefits in addition to those provided herein under any severance
or termination plan of the Company or its affiliates).  No payments or benefits provided the
Executive hereunder will be reduced by any amount the Executive may earn or
receive from



 13
 









employment
with another employer or from any other source without violation of this
Agreement.  In no event will the
Executive be obliged to seek other employment or take any other action by way of
mitigation of the amounts payable to the Executive under any of the provisions
of this Agreement.


(j)            Survival.  All
Sections of this Agreement survive beyond the Term except as otherwise
specifically stated.


(k)           Section
409A Compliance.  Notwithstanding any
provision of this Agreement to the contrary, this Agreement is intended to be
exempt from or, in the alternative, comply with Code Section 409A and the
interpretive guidance thereunder, including the exceptions for short-term
deferrals, separation pay arrangements, reimbursements, and in-kind
distributions.  The Agreement shall be
construed and interpreted in accordance with such intent.


(l)            Headings.  The
headings in this Agreement are for convenience of reference only and will not
limit or otherwise affect the meaning thereof.


(m)          Counterparts.  The
parties may execute this Agreement in one or more counterparts (including by
facsimile or electronic transmission), all of which together will constitute
but one Agreement.


IN WITNESS
WHEREOF, the parties have executed this Agreement
effective as of the date first above written.


	
  

  	
  GREAT LAKES DREDGE & DOCK CORPORATION

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/Douglas B Mackie

  
	
   

  	
  Its:

  	
  President and CEO

  
	
   

  	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  Douglas Mackie

  



 


 



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