Document:

exv10w4

 

EXHIBIT
10.4

EMPLOYMENT AGREEMENT

This Employment Agreement (“Agreement”) is entered into effective as of January 15, 2007 by and
between The Shaw Group Inc., a Louisiana corporation (collectively with its affiliates and
subsidiaries hereinafter referred to as “Company”), and Ebrahim Fatemizadeh (“Employee”) and
supersedes the Agreement dated July 7, 2005.

WHEREAS, the Company employs Employee and desires to continue such employment relationship and
Employee desires to continue such employment;

NOW, THEREFORE, in consideration of the mutual covenants, representations, warranties, and
agreements contained herein, and for other valuable consideration, the receipt and adequacy of
which are hereby acknowledged, the parties agree as follows:

1. Employment. The Company hereby continues its employment of Employee, and Employee hereby
accepts continued employment by the Company, on the terms and conditions set forth in this
Agreement.

2. Term of Employment. Subject to the provisions for earlier termination provided in this
Agreement, the term of this agreement (the “Term”) shall be three (3) years commencing on the date
hereof, and shall be automatically renewed on each day following the date hereof so that on any
given day the unexpired portion of the Term of this Agreement shall be three (3) years.
Notwithstanding the foregoing provision, at any time after the date hereof the Company or Employee
may give written notice to the other party that the Term of this Agreement shall not be further
renewed from and after a subsequent date specified in such notice (the “fixed term date”), in which
event the Term of this Agreement shall become fixed and this Agreement shall terminate on the third
anniversary of the fixed term date.

3. Employee’s Duties. During the Term of this Agreement, Employee shall continue to serve as the
Group President of the Energy and Chemicals Division of the Company or such other similar position,
with such duties and responsibilities as may from time to time be assigned to him by the Board of
Directors of the Company (the “Board”), or the Chief Executive Officer, as the case may be,
provided that such duties are consistent with his usual and customary duties as they pertain to
such position at such time. Any future duties will be consistent with his usual and customary
duties as they pertain to such position at such time.

Employee agrees to devote his full attention and time during normal business hours to the business
and affairs of the Company and to use reasonable best efforts to perform faithfully and efficiently
his duties and responsibilities. Employee shall not, either directly or indirectly, enter into any
business or employment with or for any person, firm, association or corporation other than the
Company during the Term of this Agreement; provided, however, that Employee shall not be prohibited
from making financial investments in any other company or business, or from serving on the board of
directors of any other company, or from engaging in civic, philanthropic or community services to
the extent there is no conflict with employment duties. Employee shall at all times observe and
comply with all lawful directions and instructions of the Board.

4. Compensation.

a) For services rendered by Employee under this Agreement, the Company shall pay to Employee his
current base salary as of the date of this Agreement (“Base Compensation”) payable in accordance
with the Company’s customary pay periods and subject to customary withholdings. The amount of Base
Compensation may be reviewed by the Board on an annual basis as of the close of each fiscal year of
the Company and may be increased as the Board may deem appropriate. In the event the Board deems it
appropriate to increase Employee’s annual base salary, said increased amount shall thereafter be
the “Base Compensation”. Employee’s Base Compensation, as increased from time to time, may not
thereafter be decreased unless agreed to by Employee. Nothing contained herein shall prevent the
Board from paying additional compensation to Employee in the form of bonuses or otherwise during
the Term of this Agreement.

b) Employee will participate in Company’s annual bonus plan, with performance bonus of minimum 25%
and potential of 200% of Employee’s Base Compensation, and any Long Term Incentive plan or other
compensation plan or program of the Company generally provided to other executives.

5. Additional Benefits. In addition to the Base Compensation provided for in Section 4 herein,
Employee shall be entitled to the following:

(a) Expenses. The Company shall, in accordance with any rules and policies that it may establish
from time to time for executive officers, reimburse Employee for business expenses reasonably
incurred in the performance of his duties. It is understood that Employee is authorized to incur
reasonable business expenses for promoting the business of the Company, including reasonable
expenditures for travel, lodging, meals and client or business associate entertainment. Employee’s
spouse may accompany Employee on business travel with the same class of accomodation as Employee,
and Employee shall be reimbursed for reasonable expenses related to spouse’s travel. Request for
reimbursement for such expenses must be accompanied by appropriate documentation.

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(b) Vacation. Employee shall be entitled to four (4) weeks of vacation per year, without any loss
of compensation or benefits. Employee shall be entitled to carry forward any unused vacation time.

(c) General Benefits. Employee shall be entitled to participate in the various employee benefit
plans or programs provided to the executives of the Company in general, including but not limited
to, health (including ExecuCare), dental, disability, 401K and life insurance plans, subject to the
eligibility requirements with respect to each of such benefit plans or programs, and such other
benefits or perquisites as may be approved by the Board during the Term of this Agreement. Without
limitation of the generality of the foregoing, Employee shall be entitled to participate in any and
all compensation, incentive and benefit plans and programs provided generally to executives and
officers of the Company. Nothing in this paragraph shall be deemed to prohibit the Company from
making any changes in any of the plans, programs or benefits described in this Section 5, provided
the change similarly affects all executive officers of the Company similarly situated.

(d) Long Term Incentive Awards. Upon the resignation for Good Reason as defined in Section 7 (e),
disability as defined in Section 7 (c), discharge as defined in Section 7 (d) (i), Employee shall
be considered as immediately and totally vested in any and all stock options, restricted stock ,
retention program, or other similar awards (such options or similar awards are hereinafter
collectively referred to as “Long Term Incentives”) previously made to Employee by the Company or
its subsidiaries under a Long Term Incentive Plan duly adopted by the Board. In the event any
options become vested under this paragraph, employee will be allowed not less than one year from
the date of such vesting in which to exercise such options.

6. Confidential Information. Employee, during the Term, may have access to and become familiar
with confidential information, secrets and proprietary information concerning the business and
affairs of the Company. As to such confidential information, Employee agrees as follows:

During the employment of Employee with the Company and thereafter Employee will not, either
directly or indirectly, disclose to any third party without the written permission of the Company,
nor use in any way (except as required in the course of his employment with the Company) any
confidential information, secret or proprietary information of the Company. In the event of a
breach or threatened breach of the provisions of this Section 6 (a), the Company shall be entitled,
in addition to any other remedies available to the Company, to petition a court having jurisdiction
over the parties and the subject matter to seek an injunction to restrain Employee from disclosing
such confidential information.

Upon termination of employment of Employee, for whatever reason, Employee shall surrender to the
Company any and all documents, manuals, correspondence, reports, records and similar items then or
thereafter coming into the possession of Employee which contain any confidential, secret or
proprietary information of the Company.

7. Termination This Agreement may be terminated prior to the end of its Term as set forth below:

Resignation (other than for Good
Reason). Employee may resign, including by reason of retirement,
his position at any time by providing written notice of resignation to the Company in accordance
with Section 11 hereof. In the event of such resignation, except in the case of resignation for
Good Reason (as defined below), this Agreement shall terminate and Employee shall not be entitled
to further compensation pursuant to this Agreement other than the payment of any unpaid Base
Compensation, accrued hereunder and any other vested compensation or benefits, including any vested
Long Term Incentive (which must be exercised pursuant to any plans governing such award) as of the
date of Employee’s resignation.

Death. If Employee’s employment is terminated due to his death, any benefit payable pursuant to the
Company’s benefit plans will be paid to Employee’s surviving spouse or estate, and three (3) years
of paid group health and dental insurance benefits shall be provided by the Company to Employee’s
surviving spouse and the minor children, and after said payments and provision of insurance
benefits, this Agreement shall terminate and the Company shall have no obligations to Employee or
his legal representatives with respect to this Agreement other than the payment of any unpaid Base
Compensation, the pro-rata portion of any bonus, incentive payment or deferred compensation accrued
but unpaid as of the date of death and any other vested compensation or benefits, including any
vested Long Term Incentive (which must be exercised pursuant to any plans governing such award)
previously accrued hereunder.

Disability. If Employee shall have been absent from the full-time performance of Employee’s duties
with the Company for ninety (90) consecutive calendar days as a result of Employee’s incapacity due
to physical or mental illness, Employee’s employment may be terminated by the Company for
“Disability” and Employee shall not be entitled to further compensation pursuant to this Agreement,
except that Employee shall (1) be paid monthly (but only for up to a twelve (12) month period
beginning with the Date of Termination) the amount by which Employee’s monthly Base Compensation
exceeds the monthly benefit received by Employee pursuant to any disability insurance covering
Employee; (2) continue to receive paid group health and dental insurance benefits for Employee and
his dependents for a two (2) year period beginning with Date of Termination; and (3) be considered
as immediately and totally vested in any and all Long Term Incentive Awards previously granted to
Employee by Company or its subsidiaries; and (4) shall be entitled to receive the pro-rata portion
of any bonus, incentive payment or deferred compensation accrued but unpaid as of the date of
disability.

(d) Discharge.

(i) The Company may terminate Employee’s employment for any reason at any time upon written notice
thereof delivered to Employee in accordance with Section 11 hereof. In the event that Employee’s
employment is terminated during the Term by the Company for any reason other than his Misconduct or
Disability (both as defined below), then (A) the Company shall pay in lump

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sum in cash to Employee, within fifteen (15) days following the date of termination, an amount
equal to the product of (i) Employee’s Base Compensation as in effect immediately prior to
Employee’s termination, multiplied by (ii) the Remaining Term( defined to be 3 years), (B) for the
Remaining Term, the Company, at its cost, shall provide or arrange to provide Employee (and, as
applicable, Employee’s dependents) with disability, accident and group health and other health
insurance benefits substantially similar to those which Employee (and Employee’s dependents) were
receiving immediately prior to Employee’s termination; however, the welfare benefits otherwise
receivable by Employee pursuant to this clause (B) shall be reduced to the extent comparable
welfare benefits are actually received by Employee (and/or Employee’s dependents) during such
period under any other employer’s welfare plan(s) or program(s) , with Employee being obligated to
promptly disclose to the Company any such comparable welfare benefits, (C) in addition to the
aforementioned compensation and benefits, the Company shall pay in lump sum in cash to Employee
within fifteen (15) days following the date of termination an amount equal to the product of (i)
Employee’s highest bonus paid by the Company during the most recent three (3) years immediately
prior to the Date of Termination, multiplied by (ii) the Remaining Term, and (D) Employee shall be
considered as immediately and totally vested in any and all Long Term Incentives previously made to
Employee by The Company or its subsidiaries.

(ii) Notwithstanding the foregoing provisions of this Section 7, in the event Employee is
terminated because of Misconduct, the Company shall have no obligations pursuant to this Agreement
after the Date of Termination other than the payment of any unpaid Base Compensation accrued
through the Date of Termination and any benefit to which Employee may be entitled through
application of Law. As used herein, “Misconduct” means (a) the continued failure by Employee to
substantially perform his duties with the Company (other than any such failure resulting from
Employee’s incapacity due to physical or mental illness, after prior notice by the Company’s CEO
and reasonable opportunity to cure such failure, (b) the engaging by Employee in conduct which is
demonstrably and materially injurious to the Company, monetarily or otherwise, or (c) the
misappropriation or attempted misappropriation of a material business opportunity of the Company
for Employee’s personal benefit, including attempting to secure any personal profit in connection
with entering into any transaction on behalf of the Company, (d) the intentional misappropriation
or attempted misappropriation of any of the Company’s funds or property; or (e) commission of a
felony or engaging in any other conduct involving fraud or dishonesty which is demonstrably
injurious to the Company. Anything contained in this Agreement to the contrary notwithstanding, the
Chief Executive officer of the Company shall have the sole power and authority to terminate the
employment of Employee on behalf of the Company.

(e) Resignation for Good Reason. Employee shall be entitled to terminate his employment for Good
Reason as defined herein. If Employee terminates his employment for Good Reason he shall be
entitled to the compensation and benefits provided in Paragraph 7 (d) (i) hereof. “Good Reason”
shall mean the occurrence of any of the following circumstances without Employee’s express written
consent unless such breach or circumstances are fully corrected prior to the Date of Termination
specified in the Notice of Termination given in respect hereof, which notice must be given within
thirty (30) days of the occurrance of such circumstance:

(1) the material breach of any of the Company’s obligations under this Agreement without Employee’s
express written consent,

(2) the assignment to Employee of any duties inconsistent or inappropriate to his position;

(3) the failure by the Company to pay to Employee any portion of Employee’s compensation on the
date such compensation is due;

(4) the failure by the Company to continue to provide Employee with benefits substantially similar
to those enjoyed by other executive officers who have entered into similar employment agreements
with Employer under any of the Company’s medical, health, accident, and/or disability plans in
which Employee was participating immediately prior to such time; or

(5) the failure of the Company to obtain a satisfactory agreement from any successor to assume and
agree to perform this Agreement, as contemplated in Section 13 hereof; or

(6) any action taken by the Company which results in a material dimunition in the position or
status of Employee with the Company immediately prior to such action without consent, except in the
case of termination under Section 7 (d) (ii).

In addition, the occurrence of any Corporate Change (as defined below), shall constitute “Good
Reason” hereunder, but only if Employee gives notice of his intent to terminate his employment
within ninety (90) days following the effective date of such Corporate Change.

A “Corporate Change” shall occur if (i) in the event a) The Company shall not be the surviving
entity in any merger or consolidation (or survives only as a subsidiary of another entity), or (b)
the Company sells all or substantially all of its assets to any other person or entity (other than
a wholly-owned subsidiary) and in either event the Employee is not retained in his position or
comparable position as per this Section 7 (e) (6) herein , or (ii) the Company is dissolved and
liquidated.

(f) Notice of Termination. Any purported termination of Employee’s employment by the Company under
Sections 7(c), or 7(d)(ii) or by Employee under Section 7(e), shall be communicated by written
Notice of Termination to the other party hereto in accordance with Section 11 hereof. For purposes
of this Agreement, a “Notice of Termination” shall mean a notice which, if by the Company and is
for Misconduct or Disability, shall set forth in reasonable detail the reason for such termination
of Employee’s employment, or in the case of resignation by Employee for Good Reason, said notice
must specify in reasonable detail the basis for such resignation. A Notice of Termination given by
Employee pursuant to Section 7(e) shall be effective even if given after the receipt by Employee of
notice that the Board has set a meeting to consider terminating Employee for Misconduct. Any
purported termination for which a Notice of Termination is required which is not effected pursuant
to this Section 7(f) shall not be effective.

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(g) Date of Termination, Etc. “Date of Termination” shall mean the date specified in the Notice of
Termination, provided that the Date of Termination shall be at least 15 days following the date the
Notice of Termination is given. Notwithstanding the foregoing, in the event Employee is terminated
for Misconduct, the Company may refuse to allow Employee access to the Company’s offices (other
than to allow Employee to collect his personal belongings under the Company’s supervision) prior to
the Date of Termination.

(h) Mitigation. Employee shall not be required to mitigate the amount of any payment provided for
in this Section 7 by seeking other employment or otherwise, nor shall the amount of any payment
provided for in this Agreement be reduced by any compensation earned by Employee as a result of
employment by another employer, except that any severance amounts payable to Employee pursuant to
the Company’s severance plan or policy for employees in general shall reduce the amount otherwise
payable pursuant to Sections 7(c)(i) or 7(e).

(i) Excess Parachute Payments. Notwithstanding anything in this Agreement to the contrary, to the
extent that any payment or benefit received or to be received by Employee hereunder in connection
with the termination of Employee’s employment would, as determined by tax counsel selected by the
Company, constitute an “Excess Parachute Payment” (as defined in Section 280G of the Internal
Revenue Code), the Company shall fully “gross-up” such payment so that Employee is in the same
“net” after-tax position he would have been if such payment and gross-up payments had not
constituted Excess Parachute Payments.

8. Nondisclosure and Noncompetition. Employee agrees that, as part of the consideration for this
Agreement and as an integral part hereof, he has signed and agrees to be bound by the Nondisclosure
and Noncompetition Agreement attached hereto as Exhibit A, as well as any subsequent addenda
thereto.

9. Non-exclusivity of Rights. Nothing in this Agreement shall prevent or limit Employee’s
continuing or future participation in any benefit, bonus, incentive, or other plan or program
provided by the Company or any of its affiliated companies and for which Employee may qualify, nor
shall anything herein limit or otherwise adversely affect such rights as Employee may have under
any Long Term Incentives with the Company or any of its affiliated companies.

10. Assignability. The obligations of Employee hereunder are personal and may not be assigned or
delegated by him or transferred in any manner whatsoever, nor are such obligations subject to
involuntary alienation, assignment or transfer. The Company shall have the right to assign this
Agreement and to delegate all rights, duties and obligations hereunder, either in whole or in part,
to any parent, affiliate, successor or subsidiary organization or company of the Company, so long
as the obligations of the Company under this Agreement remain the obligations of the Company.

11. Notice. For the purpose of this Agreement, notices and all other communications provided for in
this Agreement shall be in writing and shall be deemed to have been duly given when delivered or
mailed by United States registered mail, return receipt requested, postage prepaid, addressed to
the Company at its principal office address, directed to the attention of the Board with a copy to
the Secretary of the Company, and to Employee at Employee’s residence address on the records of the
Company or to such other address as either party may have furnished to the other in writing in
accordance herewith except that notice of change of address shall be effective only upon receipt.

12. Validity. The invalidity or unenforcability of any provision of this Agreement shall not
affect the validity or enforceability of any other provision of this Agreement, which shall remain
in full force and effect.

13. Successors; Binding Agreement.

The Company will require any successor (whether direct or indirect, by purchase, merger,
consolidation or otherwise) to all or substantially all of the business and/or assets of the
Company to expressly assume and agree to perform this Agreement in the same manner and to the same
extent that the Company would be required to perform it if no such succession had taken place.
Failure of the Company to obtain such agreement prior to the effectiveness of any such succession
shall be a breach of this Agreement and shall entitle Employee to compensation from the Company in
the same amount and on the same terms as he would be entitled to hereunder if he terminated his
employment for Good Reason, except that for purposes of implementing the foregoing, the date on
which any such succession becomes effective shall be deemed the Date of Termination. As used
herein, the term “Company” shall include any successor to its business and/or assets as aforesaid
which executes and delivers the Agreement provided for in this Section 13 or which otherwise
becomes bound by all terms and provisions of this Agreement by operation of law.

This Agreement and all rights of Employee hereunder shall inure to the benefit of and be
enforceable by Employee’s personal or legal representatives, executors, administrators, successors,
heirs distributees, devisees and legatees. if Employee should die while any amounts would be
payable to him hereunder if he had continued to live, all such amounts, unless otherwise provided
herein, shall be paid in accordance with the terms of this Agreement to Employee’s devisee,
legatee, or other designee or, if there be no such designee, to Employee’s estate.

14. Miscellaneous. No provision of this Agreement may be modified, waived or discharged unless
such waiver, modification or discharge is agreed to in writing and signed by Employee and such
officer as may be specifically authorized by the Board. No waiver by either party hereto at any
time of any breach by the other party hereto of, or in compliance with, any condition or provision
of this Agreement to be performed by such other party shall be deemed a waiver of similar or
dissimilar provisions or conditions at the same or at any prior or subsequent time. This Agreement
is an integration of the parties agreement; no agreement or representations, oral or otherwise,
express or implied, with respect to the subject matter hereof have been made by either party,
except those which are set forth expressly in this Agreement. THE VALIDITY, INTERPRETATION,
CONSTRUCTION AND PERFORMANCE OF THIS

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AGREEMENT SHALL BE GOVERNED BY THE LAWS OF THE STATE OF LOUISIANA.

15. Counterparts. This Agreement may be executed in one or more counterparts, each of which shall
be deemed to ‘be an original but all of which together will constitute one and the same instrument.

16. Arbitration. Except as provided in Exhibit A, either party may elect that any dispute or
controversy arising under or in connection with this Agreement be settled by arbitration in Baton
Rouge, Louisiana in accordance with the rules of the American Arbitration Association then in
effect. If the parties cannot mutually agree on an arbitrator, then the arbitration shall be
conducted by a three arbitrator panel, with each party selecting one arbitrator and the two
arbitrators so selected selecting a third arbitrator. The findings of the arbitrator(s) shall be
final and binding, and judgment may be entered thereon in any court having Jurisdiction. The
findings of the arbitrator(s) shall not be subject to appeal to any court, except as otherwise
provided by applicable law. The arbitrator(s) may, in his or her (or their) own discretion, award
legal fees and costs to the prevailing party.

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IN WITNESS WHEREOF, the parties have executed this Agreement on January 15, 2007, effective for all
purposes as provided above.

     THE SHAW GROUP INC.

          By Gary P. Graphia

          /s/ Gary P. Graphia

          Secretary, Chief Legal Officer

     EMPLOYEE:

/s/ Ebrahim Fatemizadeh

Ebrahim Fatemizadeh

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THE SHAW GROUP Inc.

NONDISCLOSURE AND NONCOMPETITION AGREEMENT

This Nondisclosure and Noncompetition Agreement (“Agreement”) is made and entered into on the date
indicated below between The Shaw Group Inc. and any and all its affiliated companies, as set forth
in Exhibit A, (collectively, “the Company”) and Ebrahim Fatemizadeh (“Executive”).
RECITALS

1. The Company desires to continue to employ Executive, and Executive desires to continue
employment with the Company, during which employment Executive shall perform those duties set forth
in his Employment Agreement as well as any other duties requested of him;

2. As part of Executive’s duties and responsibilities, Executive will have access to confidential
information of the Company and, by virtue of his employment with the Company, will have direct
contact with and will establish personal relationships with various customers of the Company; and

3. The Company and Executive recognize the Company’s need to protect the Company’s confidential and
proprietary interest in the Company’s business, business relationships, and the work product
produced by Executive on behalf of the Company in the course of Executive’s employment; and

4. As consideration, in part, for the Employment Agreement, Executive and the Company enter into
this Agreement.

     NOW, THEREFORE, Executive and Company agree as follows:

AGREEMENT

Section 1. Confidentiality. Executive will not, during Executive’s employment or any period
thereafter, directly or indirectly, disclose or make available to any person, firm, corporation,
association or other entity, or use any “Confidential Information” for any reason or purpose
whatsoever, except as necessary in the course or performing Executive’s duties under his Employment
Agreement or unless otherwise required by court order, subpoena, or other government or legal
process. For purposes of this section “ Confidential Information” shall mean information disclosed
to Executive or known by Executive as a consequence of or through Executive’s relationship with the
Company or its affiliates, about the Company’s and its affiliates’ customers, employees,
contractors, business methods, public relations methods, organization, pricing information, plans,
strategies, proposed bids, proposals, product information, procedures or finances, including,
without limitation, information of or relating to customers and customer lists. Confidential
Information shall not include any information that (i) was publicly known at the time of disclosure
to Executive; (ii) becomes publicly known or available thereafter other than by any means in
violation of this Agreement or any other duty owed to the Company by any person or entity; or (iii)
is lawfully disclosed to Executive by a third party. Upon termination of Executive’s employment
with the Company, regardless of the reason, all Confidential Information in Executive’s possession,
including copies, duplicates, and electronic files, shall be returned to the Company and shall not
be retained by Executive or furnished to any third party.

Section 2. Company Property. All personal property and equipment furnished to or prepared by
Executive in the course of or incident to Executive’s employment belong to the Company and shall be
promptly returned to the Company upon termination of Executive’s employment or at such other time
as the Company may request. Personal property includes, without limitation, all books, manuals,
records, reports, notes, contracts, lists, and other documents, electronic files, and all other
proprietary information relating to the business of the Company and/or its affiliates. Following
termination of employment, Executive will not retain any written or other tangible material
containing any proprietary information of the Company or any or all of its affiliates, but the
Company agrees to make same reasonably available to Executive in the event (and solely for such
purpose) that Executive is the subject of any subpoena or discovery request seeking such
documentation.

Section 3. Non-Solicitation. At all times during Executive’s employment and for six (6) months
after the termination of Executive’s employment, Executive will not, directly or indirectly, either
on Executive’s own account or jointly with or as a manager, agent, officer, employee, consultant,
independent contractor, partner, joint venturer, owner, financier, shareholder, or otherwise on
behalf of any other person, firm, or corporation, offer employment to, solicit, or attempt to
solicit away from the Company or its affiliates any of their officers or employees or offer
employment to any person who, during the six (6) months immediately preceding the date of such
solicitation or offer, is or was an officer or employee of the Company or any of its affiliates.

Section 4. Covenant Not to Compete. As a condition of employment and in consideration of the terms
of the Employment Agreement pursuant to which this is being executed, Executive acknowledges and
agrees to the following:

Executive acknowledges that he is intimately involved in the management of the Company, its
expansion, and its acquisition or creation of the affiliated companies, as set forth in Exhibit A.
Executive acknowledges and agrees that the business of the Company is providing engineering,
construction, procurement, maintenance, environmental and infrastructure services1, and pipe
fabrication

 

			
	1	 	Environmental and infrastructure services
include the delivery of environmental restoration, regulatory compliance,
facilities management, emergency response, and design and construction
services, environmental consulting, engineering and construction services to
private-sector and state and local government customers. These environmental
services include complete life cycle management, construction management,
Operation and Maintenance (O&M) services, and environmental services including
emergency response and high hazard and toxic waste cleanups and on-site
remedial activities site selection, permitting, design, build, operation,
decontamination, demolition, remediation and redevelopment, identification of
contaminants in soil, air and water and the subsequent design and execution of
remedial solutions, project and facilities management and other related
services for non-environmental construction, watershed restoration, emergency
response services and outsourcing of privatization markets. These
Infrastructure services include program management, operations and maintenance
solutions to support and enhance domestic and global land, water and air
transportation systems, and commercial port and marine facilities.

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services, as more fully set forth on the Company’s Form 10-K dated October 31, 2006 (the “Form
10K”).

Based on Executive’s high level in management of the Company and based on the knowledge,
information, and experience that the Executive has gained and will gain through his management
position in the Company and Executive’s ability to build a competing company engaging in some or
all of the services provided by the Company, Executive acknowledges that the scope of this
Agreement should be broad, both geographically and in the scope of conduct prohibited.

Executive acknowledges that the Company now conducts business and provides services throughout the
United States to federal agencies, federally-owned facilities or federally-controlled political
subdivisions, state and local governments and political subdivisions, and domestic and non-domestic
commercial customers. Executive acknowledges that as of the date of this Agreement, the Company
delivers services through a network of over 180 locations, including approximately 22 international
locations and approximately 22 fabrication and manufacturing facilities. Executive acknowledges
and agrees that at the time of signing this agreement, the Company conducts business in the
geographic territory (the “Restricted Area”) set forth in Exhibit B. Executive agrees that the
Company may periodically revise the Restricted Area to reflect any changes in the geographic
territory in which the Company is conducting business. Executive agrees that as consideration for
the Employment Agreement, he agrees during the term of his employment to sign addenda to this
agreement which update the Restricted Area to reflect geographic territories in which the Company
conducts its business. Executive agrees that the Company may periodically revise the description
of the business of the Company to reflect changes in the Company’s business. Executive also agrees
that as consideration for the Employment Agreement, he agrees during the term of his employment to
sign addenda to this Agreement which update the description of the business of the Company to
coincide with the description of the business of the Company as set forth in the Company’s current
Form 10-K.

Executive agrees that at all times during Executive’s employment with the Company and for six (6)
months after termination (whether voluntary or not) of Executive’s employment with the Company,
Executive shall not, directly or indirectly, whether personally or through agents, associates, or
co-workers, whether individually or in connection with any corporation, partnership, or other
business entity, and whether as an employee, owner, partner, financier, joint venturer,
shareholder, officer, manager, agent, independent contractor, consultant, or otherwise, establish,
carry on, or engage in a business similar to that of the Company or any of its affiliates, in the
Restricted Area, as defined in Exhibit B, attached. This prohibition includes, without limitation,
that Executive will not perform the following in the Restricted Area:

     (a) Solicit or provide, directly or indirectly, engineering, construction, procurement,
maintenance, Environmental, and pipe fabrication services, or any of these, to any persons or
entities who are or were customers of the Company or any of its affiliates at any time prior to
Executive’s separation from employment;

     (b) Establish, own, become employed with, consult on business matters with, or participate in
any way in a business engaged in engineering, construction, procurement maintenance, Environmental,
and pipe fabrication services, or any of these, except to the extent that the Company or any of its
affiliates do not provide as of the date of his termination of employment from the company the same
type of services as such business provides; and

     (c) Provide consulting services for, invest in, become employed by, or otherwise become
associated from a business perspective with competitors of the Company or any of its affiliates,
including but not limited to Jacobs Engineering Group Inc.; Fluor Corporation; URS Corporation;
Halliburton; Turner Industries Group, L.L.C.; Bechtel Group, Inc.; KBR, Inc.; Chicago Bridge & Iron
Company N.V.; CH2M Hill; Black & Veatch Corporation; Foster Wheeler Ltd.; and Washington Group
International, Inc., or any of their respective subsidiaries, parent companies, affiliates, or
successors.

This prohibition does not prohibit Executive from engaging in a business solely within an area or
areas not contained in the Restricted Area, so long as that business does not provide in the
Restricted Area the same or similar services or conduct the same or similar business as the Company
or its affiliates.

Executive acknowledges that the business of the Company is extremely competitive in nature, that
the remedy at law for any breach of this covenant will be inadequate, and that in the event of a
breach the Company shall be entitled to seek injunctive relief and specific performance, as well as
any and all other remedies at law or in equity to which the Company is entitled. Executive
acknowledges that the provisions contained in this Section are reasonable and valid in all respects
and are a reasonable and necessary protection of the legitimate interests of the Company and that
any violation of these provisions would cause substantial injury to the Company.

Section 5.
Miscellaneous Provisions.

     (a) Employment Rights. This Agreement shall not be deemed to confer upon Executive any right
to continue in the employ of the Company for any period or any right to continue employment at
Executive’s present or any other rate of compensation.

8

 

     (b) Amendment. This Agreement may only be amended or modified in a writing executed by both
the Company and Executive. No oral waivers or extensions shall be binding on the parties.

     (c) Waiver. No term or condition of this Agreement shall be deemed to have been waived, nor
shall there be any estoppel against the enforcement of any provision of this Agreement, except by
written instrument signed by the party charged with such waiver or estoppel. No such written
waiver shall be deemed a continuing waiver unless specifically stated therein, and each such waiver
shall operate only as to the specific term or condition waived and shall not constitute a waiver of
such term or condition for the future or as to any other act other than that specifically waived.

     (d) Injunctive Relief and Arbitration. Executive and the Company each acknowledge that the
provisions of Sections 1, 3, and 4 are reasonable and necessary, that the damages that would be
suffered as a result of a breach or threatened breach by Executive of Sections 1, 3, and 4 may not
be calculable, and that the award of a money judgment to the Company for such a breach or
threatened breach thereof by Executive would be an inadequate remedy. Consequently, Executive
expressly consents and agrees that the Company may, in addition to any other available remedies
that the Company may be entitled in law or in equity, enforce the provisions of Sections 1, 3,
and/or 4 by injunctive or other equitable relief, including a temporary and/or permanent injunction
(without proving a breach thereof), to prevent unfair competition, the use and/or unauthorized
disclosure of trade secrets or confidential information, and/or the unauthorized solicitation of
the Company’s officers, employees, and customers. The Company shall not be obligated to post bond
or other security in seeking such relief.

     (e) Arbitration. Executive and the Company agree that any dispute regarding the covenants
herein and/or the validity of this Agreement and its addenda, if any, shall be resolved through
arbitration. Given the recitals set forth in Section 4 above, Executive and the Company hereby
expressly acknowledge that Executive’s position in the Company, and the Company’s business, have a
substantial impact on interstate commerce; and further, that Executive’s development and
involvement with the Company, and the Company’s business, have a national and international
territorial scope commercially. Thus, any arbitration-related matter or arbitration proceeding of
a dispute regarding the covenants herein and/or the validity of this Agreement and its addenda,
shall be governed, heard, and decided under the provisions and the authority of the Federal
Arbitration Act, 9 U.S.C.A. § 1 et seq., and shall be submitted for arbitration to the office of
the American Arbitration Association in New Orleans, Louisiana, on demand of either party.

     Such arbitration proceedings shall be conducted in New Orleans, Louisiana, and shall be
conducted in accordance with the then-current Employment Arbitration Rules and Mediation Procedures
of the American Arbitration Association, with the exception that the Executive expressly waives the
right to request interim measures or injunctive relief from a judicial authority. Executive
acknowledges that the Company alone retains the right to seek injunctive relief from a judicial
authority based on the nature of this Agreement and in furtherance of the terms of Section 5(d)
above. Each party shall have the right to be represented by counsel or other designated
representatives. The arbitrator shall have the right to award or include in his or her award any
relief that he or she deems proper under the circumstances, including, without limitation, all
types of relief that could be awarded by a court of law, such as money damages, (with interest on
unpaid amounts from date due), specific performance, and injunctive relief. The arbitrator shall
issue a written opinion explaining the reasons for his or her decision and award. The award and
decision of the arbitrator shall be conclusive and binding upon both parties, and judgment upon the
award may be entered in any court of competent jurisdiction. The parties acknowledge and agree
that any arbitration award may be enforced against either or both of them in a court of competent
jurisdiction and each waives any right to contest the validity or enforceability of such award.
The parties further agree to be bound by the provisions of any statute of limitations that would be
otherwise applicable to the controversy, dispute, or claim that is the subject of any arbitration
proceeding initiated hereunder. Without limiting the foregoing, the parties shall be entitled in
any such arbitration proceeding to the entry of an order by a court of competent jurisdiction
pursuant to a decision of the arbitrator for specific performance of any of the requirements of
this Agreement. The provisions of this Section 5(e) shall survive and continue in full force and
effect subsequent to and notwithstanding expiration or termination of this Agreement for any
reason. Executive agrees to pay arbitration fees in an amount not to exceed the amount required to
file a lawsuit in a court of law. The Company agrees to pay the remaining amount of arbitration
fees. Executive and the Company acknowledge and agree that any and all rights they may have to
resolve their claims by a jury trial are hereby expressly waived. The provisions of this Section
5(e) with respect to the subject matter hereof do not preclude Executive from filing a complaint
with any federal, state, or other governmental administrative agency, if at all applicable. The
provisions of this Section 5(e) with respect to the subject matter hereof supersede any conflicting
provision contained in any Employment Agreement or other agreement between Executive and the
Company.

     (f) Governing Law. This Agreement, and the rights and obligations of the parties hereto,
shall be governed by and construed in accordance with the laws of the State of Louisiana. This
provision supersedes any conflicting provision contained in any Employment Agreement or other
agreement between Executive and the Company.

     (g) Assignment. This Agreement may not be assigned by Executive, but may be assigned by the
Company to any successor to its business and will inure to the benefit and be binding upon any such
successor. This Agreement shall be binding upon the parties hereto, together with their respective
executors, administrators, personal representatives, and heirs, and, in the case of the Company,
permitted successors and assigns.

     (h) Severability. Each provision of this Agreement is intended to be severable. If any term
or provision of this

9

 

Agreement is illegal or invalid for any reason whatsoever, such illegality or invalidity shall
not affect the validity or legality of the remainder of this Agreement.

     (i) Reformation. It is the intention of the parties that if any court or arbitrator(s) shall
determine that any provision of this Agreement, including the scope, duration, or geographical
limit of any provision, is unenforceable, the provision in question and this Agreement shall not be
invalidated but shall be deemed reformed or amended only to the extent necessary to render the
provision and Agreement valid and enforceable.

     (j) Headings. The headings contained in this Agreement are for reference purposes only and
shall not in any way affect the meaning or interpretation of this Agreement.

     (k) Consent. Executive acknowledges that he has reviewed the provisions of this Agreement
carefully and has been given an opportunity to ask questions of the Company. He acknowledges that
he has had ample opportunity to consult with an attorney of his choice (at his expense) prior to
signing this Agreement and that he knowingly consents to the terms herein.

10

 

     IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of this 15th day of
January, 2007.

	 	 	 	 	 
	 

	 	COMPANY:
	 	EXECUTIVE:
	 
	 	 	 	 
	 

	 	The Shaw Group Inc. and	 	 
	 
	 	 	 	 
	 

	 	its affiliates listed on Exhibit A:
	 	/s/ Ebrahim Fatemizadeh
	 
	 	 	 	 
	 

	 	 	 	          Ebrahim Fatemizadeh
	 
	 	 	 	 
	 

	 	By:     Gary P. Graphia	 	 
	 
	 	 	 	 
	 

	 	/s/ Gary P. Graphia	 	 
	 
	 	 	 	 
	 

	 	Its Secretary	 	 

11exv10w6

 

Exhibit 10.6

TRUST AGREEMENT

Between

 

THE SHAW GROUP INC.

And

FIDELITY MANAGEMENT TRUST COMPANY

 

THE SHAW GROUP DEFERRED COMPENSATION

PLAN TRUST

Dated as of January 2, 2007

Fidelity Confidential

 

 

TABLE OF CONTENTS

	 	 	 	 	 	 	 
	Section 1. Definitions	 	 	2	 
	 
	 	 	 	 	 	 
	Section 2. Trust	 	 	6	 
	(a)
	 	Establishment	 	 	6	 
	(b)
	 	Grantor Trust	 	 	6	 
	(c)
	 	Trust Assets	 	 	6	 
	(d)
	 	Non-Assignment	 	 	6	 
	 
	 	 	 	 	 	 
	Section 3. Payments to Sponsor	 	 	7	 
	 
	 	 	 	 	 	 
	Section 4. Disbursements	 	 	7	 
	(a)
	 	Directions from Administrator	 	 	7	 
	(b)
	 	Limitations	 	 	7	 
	 
	 	 	 	 	 	 
	Section 5. Investment of Trust	 	 	7	 
	(a)
	 	Selection of Investment Options	 	 	7	 
	(b)
	 	Available Investment Options	 	 	7	 
	(c)
	 	Investment Directions	 	 	7	 
	(d)
	 	Unfunded Status of Plan	 	 	8	 
	(e)
	 	Mutual Funds	 	 	8	 
	 
	 	(i)    Execution of Purchases and Sales	 	 	8	 
	 
	 	(ii)   Voting	 	 	9	 
	(f)
	 	Trustee Powers	 	 	9	 
	 
	 	 	 	 	 	 
	Section 6. Recordkeeping and Administrative Services to Be Performed	 	 	10	 
	(a)
	 	General	 	 	10	 
	(b)
	 	Accounts	 	 	10	 
	(c)
	 	Inspection and Audit	 	 	11	 
	(d)
	 	Notice of Plan Amendment	 	 	11	 
	(e)
	 	Returns, Reports and Information	 	 	11	 
	 
	 	 	 	 	 	 
	Section 7. Compensation and Expenses	 	 	11	 
	 
	 	 	 	 	 	 
	Section 8. Directions and Indemnification	 	 	12	 
	(a)
	 	Identity of the Sponsor and the Administrator	 	 	12	 
	(b)
	 	Directions from the Sponsor and the Administrator	 	 	12	 
	(c)
	 	Directions from Participants	 	 	12	 
	(d)
	 	Indemnification	 	 	12	 
	(e)
	 	Survival	 	 	13	 
	 
	 	 	 	 	 	 
	Section 9. Resignation or Removal of Trustee	 	 	13	 
	(a)
	 	Resignation and Removal	 	 	13	 
	(b)
	 	Termination	 	 	13	 
	(c)
	 	Notice Period	 	 	13	 
	(d)
	 	Transition Assistance	 	 	13	 
	(e)
	 	Failure to Appoint Successor	 	 	13	 
	 
	 	 	 	 	 	 
	Section 10. Successor Trustee	 	 	14	 
	(a)
	 	Appointment	 	 	14	 
	(b)
	 	Acceptance	 	 	14	 
	(c)
	 	Corporate Action	 	 	14	 
	 
	 	 	 	 	 	 
	Section 11. Resignation, Removal, and Termination Notices	 	 	14	 
	 
	 	 	 	 	 	 
	Section 12. Duration	 	 	14	 
	 
	 	 	 	 	 	 
	Section 13. Insolvency of Sponsor	 	 	14	 
	 
	 	 	 	 	 	 
	Section 14. Amendment or Modification	 	 	15	 

	 	 	 
	Fidelity Confidential
	 	i

 

	 	 	 	 	 	 	 
	Section 15. Electronic Services	 	 	15	 
	 
	 	 	 	 	 	 
	Section 16. Assignment	 	 	17	 
	 
	 	 	 	 	 	 
	Section 17. Force Majeure	 	 	17	 
	 
	 	 	 	 	 	 
	Section 18. Confidentiality	 	 	17	 
	 
	 	 	 	 	 	 
	Section 19. General	 	 	18	 
	(a)
	 	Performance by Trustee, its Agents or Affiliates	 	 	18	 
	(b)
	 	Entire Agreement	 	 	18	 
	(c)
	 	Waiver	 	 	18	 
	(d)
	 	Successors and Assigns	 	 	18	 
	(e)
	 	Partial Invalidity	 	 	18	 
	(f)
	 	Section Headings	 	 	18	 
	 
	 	 	 	 	 	 
	Section 20. Use of Data	 	 	19	 
	 
	 	 	 	 	 	 
	Section 21. Other Services	 	 	19	 
	 
	 	 	 	 	 	 
	Section 22. Governing Law	 	 	20	 
	(a)
	 	Massachusetts Law Controls	 	 	20	 
	(b)
	 	Trust Agreement Controls	 	 	20	 

	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 
	SCHEDULES	 	 	22	 
	 
	 	 	 	 	 	 
	Schedule “A”
	 	Recordkeeping and Administrative Services	 	 	22	 
	 
	 	 	 	 	 	 
	Schedule “B”
	 	Fee Schedule	 	 	25	 
	 
	 	 	 	 	 	 
	Schedule “C”
	 	Investment Options	 	 	26	 
	 
	 	 	 	 	 	 
	Schedule “D”
	 	Operational Guidelines for Non-Fidelity Mutual Funds	 	 	27	 
	 
	 	 	 	 	 	 
	Schedule “E”
	 	Sample Direction Letter	 	 	28	 

	 	 	 
	Fidelity Confidential
	 	ii

 

     TRUST AGREEMENT, dated as of the second day of January, 2007, between the Shaw Group Inc., a
Louisiana corporation, having an office at 4171 Essen Lane, Baton Rouge, Louisiana 70809 (the
“Sponsor”), and FIDELITY MANAGEMENT TRUST COMPANY, a Massachusetts trust company, having an office
at 82 Devonshire Street, Boston, Massachusetts 02109 (the “Trustee”).

WITNESSETH:

     WHEREAS, the Sponsor is the sponsor of the Shaw Group Deferred Compensation Plan (the “Plan”);
and

     WHEREAS, the Sponsor wishes to establish an irrevocable trust and to contribute to the Trust
assets that shall be held therein, subject to the claims of Sponsor’s creditors in the event of
Sponsor’s Insolvency, as herein defined, until paid to Participants and their beneficiaries in such
manner and at such times as specified in the Plan; and

     WHEREAS, it is the intention of the parties that this Trust shall constitute an unfunded
arrangement and shall not affect the status of the Plan as an unfunded plan maintained for the
purpose of providing deferred compensation for a select group of management or highly compensated
employees for purposes of Title I of the Employee Retirement Income Security Act of 1974 (“ERISA”);
and

     WHEREAS, it is the intention of the Sponsor to make contributions to the Trust to provide
itself with a source of funds to assist it in the meeting of its liabilities under the Plan; and

     WHEREAS, the Trustee is willing to hold and invest the aforesaid plan assets in trust among
several investment options selected by the Sponsor; and

     WHEREAS, the Sponsor also wishes to have the Trustee perform certain ministerial recordkeeping
and administrative functions under the Plan; and

     WHEREAS, the Trustee is willing to perform recordkeeping and administrative services for the
Plan if the services are ministerial in nature and are provided within a framework of plan
provisions, guidelines and interpretations conveyed in writing to the Trustee by the Administrator
(as defined herein).

     NOW, THEREFORE, in consideration of the foregoing premises and the mutual covenants and
agreements set forth below, the Sponsor and the Trustee agree as follows:

Section 1. Definitions.

The following terms as used in this Trust Agreement have the meaning indicated unless the context
clearly requires otherwise:

          (a) “Administrator”

“Administrator” shall mean the Sponsor identified in the Plan document as the “administrator” of
the Plan.

          (b) “Agreement”

2

 

“Agreement” shall mean this Trust Agreement, and the Schedules and/or Exhibits attached hereto, as
the same may be amended and in effect from time to time.

          (c) “Business Day”

“Business Day” shall mean each day the NYSE is open. The closing of a Business Day shall mean the
NYSE’s normal closing time of 4:00 p.m.(ET), however, in the event the NYSE closes before such time
or alters its closing time, all references to the NYSE closing time shall mean the actual or
altered closing time of the NYSE.

          (d) “Code”

“Code” shall mean the Internal Revenue Code of 1986, as it has been or may be amended from time to
time.

          (e) “Confidential Information”

“Confidential Information” shall mean (individually and collectively) proprietary information of
the parties to this Trust Agreement, including but not limited to, their inventions, know how,
trade secrets, business affairs, prospect lists, product designs, product plans, business
strategies, finances, fee structures, etc.

          (f) “EDT”

“EDT” shall mean electronic data transfer.

          (g) “Electronic Services”

“Electronic Services” shall mean communication and services made available via electronic media.

          (h) “ERISA”

“ERISA” shall mean the Employee Retirement Income Security Act of 1974, as it has been or may be
amended from time to time.

          (i) “External Account Information”

“External Account Information” shall mean account information, including retirement savings account
information, from third party websites or other websites maintained by Fidelity or its affiliates.

          (j) “Fidelity Mutual Fund”

“Fidelity Mutual Fund” shall mean any investment company advised by Fidelity Management & Research
Company or any of its affiliates.

          (k) “FIIOC”

3

 

          “FIIOC” shall mean Fidelity Investments Institutional Operations Company, Inc.

          (l) “In Good Order”

“In Good Order” shall mean in a state or condition acceptable to the Trustee in its sole
discretion, which the Trustee determines is reasonably necessary for accurate execution of the
intended transaction.

          (m) “Insolvency”

“Insolvency” shall mean that if (i) Sponsor is unable to pay its debts as they become due, or (ii)
Sponsor is subject to a pending proceeding as a debtor under the United States Bankruptcy Code.

          (n) “Insolvent”

“Insolvent” shall mean that if (i) Sponsor is unable to pay its debts as they become due, or (ii)
Sponsor is subject to a pending proceeding as a debtor under the United States Bankruptcy Code.

          (o) “Losses”

“Losses” shall mean any and all loss, damage, penalty, liability, cost and expense, including
without limitation, reasonable attorney’s fees and disbursements.

          (p) “Mutual Fund”

“Mutual Fund” shall refer both to Fidelity Mutual Funds and Non-Fidelity Mutual Funds.

          (q) “NAV”

“NAV” shall mean Net Asset Value.

          (r) “NFSLLC”

“NFSLLC” shall mean National Financial Services LLC.

          (s) “Non-Fidelity Mutual Fund”

“Non-Fidelity Mutual Fund” shall mean certain investment companies not advised by Fidelity
Management & Research Company or any of its affiliates.

          (t) “NYSE”

“NYSE” shall mean the New York Stock Exchange.

          (u) “Participant”

“Participant” shall mean, with respect to the Plan, any employee (or former employee) with an
account under the Plan, which has not yet been fully distributed and/or forfeited, and shall
include the designated beneficiary(ies) with respect to the account of any deceased employee (or
deceased former employee) until such account has been fully distributed and/or forfeited.

4

 

          (v) “Participant Recordkeeping Reconciliation Period”

“Participant Recordkeeping Reconciliation Period” shall mean the period beginning on the date of
the initial transfer of assets to the Trust and ending on the date of the completion of the
reconciliation of Participant records.

          (w) “PIN”

“PIN” shall mean personal identification number.

          (x) “Plan”

“Plan” shall mean the Shaw Group Deferred Compensation Plan.

          (y) “Plan Administration Manual”

“Plan Administration Manual” shall mean the document which sets forth the administrative and
recordkeeping duties and procedures to be followed by the Trustee in administering the Plan, as
such document may be amended and in effect from time to time.

          (z) “Plan Sponsor Webstation”

“Plan Sponsor Webstation” shall mean the graphical windows based application that provides current
Plan and Participant information including indicative data, account balances, activity and history.

          (aa) “Reporting Date”

“Reporting Date” shall mean the last day of each fiscal quarter of the Plan and, if not on the last
day of fiscal quarter, the date as of which the Trustee resigns or is removed pursuant to this
Agreement or the date as of which this Agreement terminates pursuant to Section 9 hereof.

          (bb) “SEC”

“SEC” shall mean the Securities and Exchange Commission.

          (cc) “Sponsor”

“Sponsor” shall mean the Shaw Group Inc., a Louisiana corporation, or any successor to all or
substantially all of its businesses which, by agreement, operation of law or otherwise, assumes the
responsibility of the Sponsor under this Agreement.

          (dd) “Trust”

“Trust” shall mean the Shaw Group Deferred Compensation Plan Trust, being the trust established by
the Sponsor and the Trustee pursuant to the provisions of this Agreement.

          (ee) “Trustee”

5

 

“Trustee” shall mean Fidelity Management Trust Company, a Massachusetts trust company and any
successor to all or substantially all of its trust business as described in Section 10. The term
Trustee shall also include any successor trustee appointed pursuant to Section 10 to the extent
such successor agrees to serve as Trustee under this Agreement.

          (ff) “VRS”

“VRS” shall mean Voice Response System.

Section 2. Trust.

          (a) Establishment.

The Sponsor hereby establishes the Trust with the Trustee. The Trust shall consist of an initial
contribution of money or other property acceptable to the Trustee in its sole discretion, made by
the Sponsor or transferred from a previous trustee under the Plan, such additional sums of money as
shall from time to time be delivered to the Trustee under the Plan, all investments made therewith
and proceeds thereof, and all earnings and profits thereon, less the payments that are made by the
Trustee as provided herein, without distinction between principal and income. The Trustee hereby
accepts the Trust on the terms and conditions set forth in this Agreement. In accepting this Trust,
the Trustee shall be accountable for the assets received by it, subject to the terms and conditions
of this Agreement.

          (b) Grantor Trust.

The Trust is intended to be a grantor trust, of which the Sponsor is the grantor, within the
meaning of subpart E, part I, subchapter J, chapter 1, subtitle A of the Code, as amended, and
shall be construed accordingly.

          (c) Trust Assets.

The principal of the Trust, and any earnings thereon shall be held separate and apart from other
funds of the Sponsor and shall be used exclusively for the uses and purposes of Participants and
general creditors as herein set forth. Participants and their beneficiaries shall have no preferred
claim on, or any beneficial ownership interest in, any assets of the Trust. Any rights created
under the Plan and this Agreement shall be mere unsecured contractual rights of Participants and
their beneficiaries against the Sponsor. Any assets held by the Trust will be subject to the claims
of the Sponsor’s general creditors under federal and state law in the event of Sponsor’s
Insolvency.

          (d) Non-Assignment.

Benefit payments to Participants and their beneficiaries funded under this Trust may not be
anticipated, assigned (either at law or in equity), alienated, pledged, encumbered, or subjected to
attachment, garnishment, levy, execution, or other legal or equitable process.

6

 

Section 3. Payments to Sponsor.

Except as provided under this Agreement, the Sponsor shall have no right to retain or divert to
others any of the Trust assets before all payment of benefits have been made to Participants
pursuant to the terms of the Plan.

Section 4. Disbursements.

          (a) Directions from Administrator.

The Trustee shall disburse monies to employee Participants and their beneficiaries for benefit
payments in the amounts that the Administrator directs from time to time in writing. The Trustee
shall have no responsibility to ascertain whether the Administrator’s direction complies with the
terms of the Plan or of any applicable law. The Trustee shall be responsible for Federal or State
income tax reporting or withholding with respect to such Plan benefits. The Trustee shall not be
responsible for FICA (Social Security and Medicare), or any Federal or State unemployment or local
tax with respect to Plan distributions.

          (b) Limitations.

The Trustee shall not be required to make any disbursement in excess of the net realizable value of
the assets of the Trust at the time of the disbursement. The Trustee shall not be required to make
any disbursement in cash or shares unless the Administrator has provided a written direction as to
the assets to be converted to cash or shares for the purpose of making the disbursement.

Section 5. Investment of Trust.

          (a) Selection of Investment Options.

The Trustee shall have no responsibility for the selection of investment options under the Trust
and shall not render investment advice to any person in connection with the selection of such
options.

          (b) Available Investment Options,

The Sponsor shall direct the Trustee as to what investment options the Trust shall be invested in
(i) during the Participant Recordkeeping Reconciliation Period, and (ii) following the Participant
Recordkeeping Reconciliation Period, subject to the following limitations. The Sponsor may
determine to offer as investment options only Mutual Funds, provided, however, mat the Trustee
shall not be considered a fiduciary with investment discretion. The Sponsor may add or remove
investment options with the consent of the Trustee to reflect administrative concerns and upon
mutual amendment of this Agreement and the Schedules thereto, to reflect such additions.

          (c) Investment Directions.

The Sponsor shall direct the Trustee as to how to invest the assets held in the Trust. In order to

7

 

provide for an accumulation of assets comparable to the contractual liabilities accruing under the
Plan, the Sponsor may direct the Trustee in writing to invest the assets held in the Trust to
correspond to the hypothetical investments made for Participants in accordance with their direction
under the Plan. In such cases, Participants may provide directions with respect to their
hypothetical investments under the Plan by use of the system maintained for such purposes by the
Trustee or its agents, as may be agreed upon from time to time by the Sponsor and the Trustee, and
shall be processed in accordance with the fund exchange provisions set forth in the Plan
Administration Manual. The Trustee shall not be liable for any loss or expense that arises from a
Participant’s exercise or non-exercise of rights under this Section 5 over the assets in the
Participant’s accounts. In the event that the Trustee fails to receive a proper direction, the
assets in question shall be invested in the investment option set forth for such purpose on
Schedule “C” until the Trustee receives a proper direction.

          (d) Unfunded Status of Plan

The Sponsor’s designation of available investment options, the maintenance of accounts for each
Participant, the crediting of investments gains (or losses) to such accounts, and the exercise by
Participants of any powers relating to investments under this Agreement are solely for the purpose
of providing a mechanism for measuring the obligation of the Sponsor to any particular Participant
under the applicable Plan. As provided in this Agreement, no Participant will have any preferential
claim to or beneficial ownership interest in any asset or investment held in the Trust, and the
rights of any Participant under the applicable Plan and this Agreement are solely those of an
unsecured general creditor of the Sponsor with respect to the benefits of the Participant under the
Plan.

          (e) Mutual Funds.

On the effective date of this Agreement, in lieu of receiving a printed copy of the prospectus for
each Fidelity Mutual Fund selected by the Sponsor as a Plan investment option or short-term
investment fund, the Sponsor hereby consents to receiving such documents electronically. The
Sponsor shall access each prospectus on the internet after receiving notice from the Trustee that a
current version is available online at a website maintained by the Trustee or its affiliate.
Trustee represents that on the effective date of this Agreement, a current version of each such
prospectus is available at https://www.fidelity.com or such successor website as Trustee
may notify the Sponsor of in writing from time to time. The Sponsor represents that it has
accessed/will access each such prospectus as of the effective date of this Agreement at
https://www.fidelity.com or such successor website as Trustee may notify the Sponsor of in
writing from time to time. Transactions involving Non-Fidelity Mutual Funds shall be executed in
accordance with the operational guidelines set forth in Schedule “D” attached hereto. Trust
investments in Mutual Funds shall be subject to the following limitations:

               (i) Execution of Purchases and Sales.

Purchases and sales of Mutual Funds (other than for exchanges) shall be made on the date on which
the Trustee receives from the Sponsor In Good Order all information and documentation necessary to
accurately effect such transactions and (if applicable) wire transfer of funds.

Exchanges of Mutual Funds shall be processed in accordance with the fund exchange provisions set
forth in the Plan Administration Manual.

8

 

               (ii) Voting.

The Sponsor directs the Trustee to vote the shares of Mutual Funds held in the Trust in the same
manner as directed by Participants for the corresponding hypothetical shares of Mutual Funds
credited to Participants’ accounts under the Plan. At the time of mailing of notice of each annual
or special stockholders’ meeting of any Mutual Fund, the Trustee shall send a copy of the notice
and all proxy solicitation materials to each Participant who has hypothetical shares of such Mutual
Fund credited to the Participant’s account, together with a voting direction form for return to the
Trustee or its designee. The Participant shall have the right to direct the Trustee as to the
manner in which the Trustee is to vote the hypothetical shares credited to the Participant’s
account. The Trustee shall vote the shares held in the Trust in a manner which corresponds to
Participant directions with respect to the hypothetical shares credited to the Participant’s Plan
account. The Trustee shall not vote shares for which it has received no corresponding directions
from the Participant.

During the Participant Recordkeeping Reconciliation Period, the Sponsor shall have the right to
direct the Trustee as to the manner in which the Trustee is to vote the shares of the Mutual Funds
in the Trust, including Mutual Fund shares held in any short-term investment fund for liquidity
reserve. Following the Participant Recordkeeping Reconciliation Period, the Sponsor shall continue
to have the right to direct the Trustee as to the manner in which the Trustee is to vote any Mutual
Funds shares held in a short-term investment fund for liquidity reserve. The Trustee shall not vote
any such Mutual Fund shares for which it has received no directions from the Sponsor.

With respect to all rights other than the right to vote, the Trustee shall follow the directions of
the Sponsor. The Trustee shall have no further duty to solicit directions from the Sponsor or
Participants.

          (f) Trustee Powers.

The Trustee shall have the following powers and authority:

               (i) Subject to this Section 5, to sell, exchange, convey, transfer, or otherwise dispose of
any property held in the Trust, by private contract or at public auction. No person dealing with
the Trustee shall be bound to see to the application of the purchase money or other property
delivered to the Trustee or to inquire into the validity, expediency, or propriety of any such sale
or other disposition.

               (ii) To cause any securities or other property held as part of the Trust to be registered in
the Trustee’s own name, in the name of one or more of its nominees, or in the Trustee’s account
with the Depository Trust Company of New York and to hold any investments in bearer form, but the
books and records of the Trustee shall at all times show that all such investments are part of the
Trust.

               (iii) To keep that portion of the Trust in cash or cash balances as the Sponsor or
Administrator may, from time to time, deem to be in the best interest of the Trust.

               (iv) To make, execute, acknowledge, and deliver any and all documents of transfer or
conveyance and to carry out the powers herein granted.

9

 

               (v) To borrow funds from a bank or other financial institution not affiliated with the Trustee
in order to provide sufficient liquidity to process Plan transactions in a timely fashion, provided
that the cost of borrowing shall be allocated in a reasonable fashion to the investment fund(s) in
need of liquidity. The Sponsor acknowledges that it has received the disclosure on the Trustee’s
line of credit program and credit allocation policy and a copy of the text of Prohibited
Transaction Exemption 2002-55 prior to executing this Agreement if applicable.

               (vi) To settle, compromise, or submit to arbitration any claims, debts, or damages due to or
arising from the Trust; to commence or defend suits or legal or administrative proceedings; to
represent the Trust in all suits and legal and administrative hearings; and to pay all reasonable
expenses arising from any such action, from the Trust if not paid by the Sponsor.

               (vii) To employ legal, accounting, clerical, and other assistance as may be required in
carrying out the provisions of this Agreement and to pay their reasonable expenses and compensation
from the Trust if not paid by the Sponsor.

               (viii) To do all other acts, although not specifically mentioned herein, as the Trustee may
deem necessary to carry out any of the foregoing powers and the purposes of the Trust.

Notwithstanding any powers granted to Trustee pursuant to this Agreement or to applicable law,
Trustee shall not have any power that could give this Trust the objective of carrying on a business
and dividing the gains therefrom, within the meaning of Section 301.7701-2 of the Procedure and
Administrative Regulations promulgated pursuant to the Code. The Trustee will file an annual
fiduciary return to the extent required by law.

Section 6. Recordkeeping and Administrative Services to Be Performed.

          (a) General.

The Trustee shall perform those recordkeeping and administrative functions described in Schedule
“A” attached hereto. These recordkeeping and administrative functions shall be performed within the
framework of the Administrator’s written directions regarding the Plan’s provisions, guidelines and
interpretations.

          (b) Accounts.

The Trustee shall keep accurate accounts of all investments, receipts, disbursements, and other
transactions hereunder, and shall report the value of the assets held in the Trust as of the last
day of each Reporting Date. Within thirty (30) days following each Reporting Date or within sixty
(60) days in the case of a Reporting Date caused by the resignation or removal of the Trustee, or
the termination of this Agreement, the Trustee shall file with the Administrator a written account
setting forth all investments, receipts, disbursements, and other transactions effected by the
Trustee between the Reporting Date and the prior Reporting Date, and setting forth the value of the
Trust as of the Reporting Date. Except as otherwise required under applicable law, upon the
expiration of six (6) months from the date of filing such account, the Trustee shall have no
liability or further accountability to anyone with respect to the propriety of its acts or
transactions shown in such account, except with respect to such acts or transactions as to which a
written

10

 

objection shall have been filed with the Trustee within such six (6) month period.

          (c) Inspection and Audit.

Prior to the termination of this Agreement, all records generated by the Trustee in accordance with
paragraphs (a) and (b) shall be open to inspection and audit, by the Administrator or any persons
designated by the Administrator, during the Trustee’s regular business hours. Upon the resignation
or removal of the Trustee or the termination of this Agreement, the Trustee shall provide to the
Sponsor, at no expense to the Sponsor, in the format regularly provided to the Sponsor, a
statement of each Participant’s account as of the resignation, removal, or termination, and the
Trustee shall provide to the Sponsor or the Plan’s new recordkeeper such further records as are
reasonable, at the Sponsor’s expense.

          (d) Notice of Plan Amendment.

The Trustee’s provision of the recordkeeping and administrative services set forth in this Section
shall be conditioned on the Sponsor delivering to the Trustee a copy of any amendment to the Plan
as soon as administratively feasible following the amendment’s adoption, and on the Administrator
providing the Trustee, on a timely basis, with all the information the Trustee deems necessary for
the Trustee to perform the recordkeeping and administrative services and such other information as
the Trustee may reasonably request.

          (e) Returns Reports and Information.

Except as set forth in the Plan Reporting section of Schedule “A”, the Administrator shall be
responsible for the preparation and filing of all returns, reports, and information required of the
Trust or Plan by law. The Trustee shall provide the Administrator with such information as the
Administrator may reasonably request to make these filings. The Administrator shall also be
responsible for making any disclosures to Participants required by law.

Section 7. Compensation and Expenses.

Sponsor shall pay to Trustee, within thirty (30) days of receipt of the Trustee’s bill, the fees
for services in accordance with Schedule “B.” Fees for services are specifically outlined in
Schedule “B” and are based on any assumptions identified therein. The Trustee shall maintain its
fees for three years; provided, however, in the event that the Plan characteristics referenced in
the assumptions outlined in Schedule “B” change significantly by either falling below or exceeding
current or projected levels, such fees may be subject to revision, upon mutual renegotiation. To
reflect increased operating costs, Trustee may once each calendar year, but not prior to January 2,
2010, amend Schedule “B” without the Sponsor’s consent upon ninety (90) days prior notice to the
Sponsor.

All reasonable expenses of Plan administration as shown on Schedule “B” attached hereto, as amended
from time to time, shall be a charge against and paid from the appropriate Participants’ accounts,
except to the extent such amounts are paid by the Sponsor in a timely manner.

All expenses of the Trustee relating directly to the acquisition and disposition of investments
constituting part of the Trust, and all taxes of any kind whatsoever that may be levied or assessed

11

 

under existing or future laws upon or in respect of the Trust or the income thereof, shall be a
charge against and paid from the appropriate Participants’ accounts.

Section 8. Directions and Indemnification.

          (a) Identity of the Sponsor and the Administrator.

The Trustee shall be fully protected in relying on the fact that the Sponsor and the Administrator
under the Plan are the individual or persons named as such above or such other individuals or
persons as the Sponsor may notify the Trustee in writing.

          (b) Directions from the Sponsor and the Administrator.

Whenever the Sponsor and the Administrator provides a direction to the Trustee, the Trustee shall
not be liable for any loss or expense arising from the direction if the direction is contained in a
writing provided by any individual whose name has been submitted (and not withdrawn) in writing to
the Trustee by the Sponsor or the Administrator unless it is clear on the direction’s face that the
actions to be taken under the direction would be contrary to the terms of this Agreement. The
Trustee may rely without further duty of inquiry on the authority of any such individual to provide
direction to the Trustee on behalf of the Sponsor.

For purposes of this Section, such Direction may also be made via EDT, facsimile or such other
secure electronic means in accordance with procedures agreed to by the Sponsor and the Trustee and,
in any such case the Trustee shall be fully protected in relying on such Direction as if it were a
Direction made in writing by the Sponsor.

          (c) Directions from Participants.

The Trustee shall not be liable for any loss which arises from any Participant’s exercise or
non-exercise of rights under the Plan over the assets in the Participants’ hypothetical accounts.

          (d) Indemnification.

The Sponsor shall indemnify the Trustee against, and hold the Trustee harmless from, any and all
Losses that may be incurred by, imposed upon, or asserted against the Trustee by reason of any
claim, regulatory proceeding, or litigation arising from any act done or omitted to be done by any
individual or person with respect to the Plan or Trust, excepting only any and all Losses arising
solely from the Trustee’s negligence or bad faith.

The Trustee shall indemnify the Sponsor against, and hold the Sponsor harmless from, any and all
Losses that may be incurred by, imposed upon, or asserted against the Sponsor by reason of any
claim, regulatory proceeding, or litigation arising from Trustee’s negligence or bad faith.

The Trustee shall also indemnify the Sponsor against and hold the Sponsor harmless from any and all
such Losses that may be incurred by, imposed upon, or asserted against the Sponsor solely as a
result of: i) any defects in the investment methodology embodied in the target asset allocation or
model portfolio provided through Portfolio Review, except to the extent that any such Losses

12

 

arise from information provided by the Participant, the Sponsor or third parties; or ii) any
prohibited transactions resulting from the provision of Portfolio Review by the Trustee.

          (e) Survival.

The provisions of this Section shall survive the termination of this Agreement.

Section 9. Resignation or Removal of Trustee.

          (a) Resignation and Removal.

The Trustee may resign at any time in accordance with the notice provisions set forth below. The
Sponsor may remove the Trustee at any time in accordance with the notice provisions set forth
below.

          (b) Termination.

This Agreement may be terminated in full, or with respect to only a portion of the Plan (i.e. a
“partial deconversion”) at any time by the Sponsor upon prior written notice to the Trustee in
accordance with the notice provisions set forth below.

          (c) Notice Period.

In the event either party desires to terminate this Agreement or any Services hereunder, the party
shall provide at least sixty (60) days prior written notice of the termination date to the other
party; provided, however, that the receiving party may agree, in writing, to a shorter notice
period.

          (d) Transition Assistance.

In the event of termination of this Agreement, if requested by Sponsor, the Trustee shall assist
Sponsor in developing a plan for the orderly transition of the Plan data, cash and assets then
constituting the Trust and services provided by the Trustee hereunder to Sponsor or its designee.
The Trustee shall provide such assistance for a period not extending beyond sixty (60) days from
the termination date of this Agreement. The Trustee shall provide to Sponsor, or to any person
designated by Sponsor, at a mutually agreeable time, one file of the Plan data prepared and
maintained by the Trustee in the ordinary course of business, in the Trustee’s format. The Trustee
may provide other or additional transition assistance as mutually determined for additional fees,
which shall be due and payable by the Sponsor prior to any termination of this Agreement.

          (e) Failure to Appoint Successor.

If, by the termination date, the Sponsor has not notified the Trustee in writing as to the
individual or entity to which the assets and cash are to be transferred and delivered, the Trustee
may bring an appropriate action or proceeding for leave to deposit the assets and cash in a court
of competent jurisdiction. The Trustee shall be reimbursed by the Sponsor for all costs and

13

 

expenses of the action or proceeding including, without limitation, reasonable attorneys’ fees and
disbursements.

Section 10. Successor Trustee.

          (a) Appointment.

If the office of Trustee becomes vacant for any reason, the Sponsor may in writing appoint a
successor trustee under this Agreement. The successor trustee shall have all of the rights, powers,
privileges, obligations, duties, liabilities, and immunities granted to the Trustee under this
Agreement. The successor trustee and predecessor trustee shall not be liable for the acts or
omissions of the other with respect to the Trust.

          (b) Acceptance.

As of the
date the successor trustee accepts its appointment under this Agreement, title to and
possession of the Trust assets shall immediately vest in the successor trustee without any further
action on the part of the predecessor trustee, except as may be required to evidence such
transition. The predecessor trustee shall execute all instruments and do all acts that may be
reasonably necessary and requested in writing by the Sponsor or the successor trustee to vest title
to all Trust assets in the successor trustee or to deliver all Trust assets to the successor
trustee.

          (c) Corporate Action.

Any successor of the Trustee or successor trustee, either through sale or transfer of the business
or trust department of the Trustee or successor trustee, or through reorganization, consolidation,
or merger, or any similar transaction of either the Trustee or successor trustee, shall, upon
consummation of the transaction, become the successor trustee under this Agreement.

Section 11. Resignation, Removal, and Termination Notices.

All notices of resignation, removal, or termination under this Agreement must be in writing and
mailed to the party to which the notice is being given by certified or registered mail, return
receipt requested, to the Sponsor c/o the Shaw Group Inc., 4171 Essen Lane, Baton Rouge, Louisiana
70809, and to the Trustee c/o FESCo Business Compliance, Attn: Contracts, Fidelity Investments, 82
Devonshire Street, MM3H, Boston, Massachusetts 02109, or to such other addresses as the parties
have notified each other of in the foregoing manner.

Section 12. Duration.

This Trust shall continue in effect without limit as to time, subject, however, to the provisions
of this Agreement relating to amendment, modification, and termination thereof.

Section 13. Insolvency of Sponsor.

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          (a) Trustee shall cease disbursement of funds for payment of benefits to Participants if the
Sponsor is Insolvent.

          (b) All times during the continuance of this Trust, the principal and income of the Trust
shall be subject to claims of general creditors of the Sponsor under federal and state law as set
forth below.

               (i) The Board of Directors and the Chief Executive Officer of the Sponsor shall have the duty
to inform Trustee in writing of Sponsor’s Insolvency. If a person claiming to be a creditor of the
Sponsor alleges in writing to Trustee that Sponsor has become Insolvent, Trustee shall determine
whether Sponsor is Insolvent and, pending such determination, Trustee shall discontinue
disbursements for payment of benefits to Participants.

               (ii) Unless Trustee has actual knowledge of Sponsor’s Insolvency, or has received notice from
Sponsor or a person claiming to be a creditor alleging that Sponsor is Insolvent, Trustee shall
have no duty to inquire whether Sponsor is Insolvent. Trustee may in all events rely on such
evidence concerning Sponsor’s solvency as may be furnished to Trustee and that provides Trustee
with a reasonable basis for making a determination concerning Sponsor’s solvency.

               (iii) If at any time Trustee has determined that Sponsor is Insolvent, Trustee shall
discontinue disbursements for payments to Participants and shall hold the assets of the trust for
the benefit of Sponsor’s general creditors. Nothing in this Agreement shall in any way diminish any
rights of Participants to pursue their rights as general creditors of Sponsor with respect to
benefits due under the Plan or otherwise.

               (iv) Trustee shall resume disbursement for the payment of benefits to Participants in
accordance with this Agreement only after Trustee has determined that Sponsor is not Insolvent (or
is no longer Insolvent).

          (c) Provided that there are sufficient assets, if Trustee discontinues the payment of benefits
from the Trust pursuant to (a) hereof and subsequently resumes such payments, the first payment
following such discontinuance shall include the aggregate amount of all payments due to
Participants under the terms of the Plan for the period of such discontinuance, less the aggregate
amount of any payments made to Participants by Sponsor in lieu of the payments provided for
hereunder during any such period of discontinuance.

Section 14. Amendment or Modification.

This Agreement may be amended or modified at any time and from time to time only by an instrument
executed by both the Sponsor and the Trustee. The individuals authorized to sign such instrument
shall be those authorized by the Sponsor.

Section 15. Electronic Services.

          (a) The Trustee may provide communications and Electronic Services via electronic media,
including, but not limited to NetBenefits, eWorkplace and Fidelity Plan Sponsor WebStation. The
Sponsor agrees to use such Electronic Services only in the course of reasonable administration of
or participation in the Plan and to keep confidential and not alter,

15

 

publish, copy, broadcast, retransmit, reproduce, frame-in, link to, commercially exploit or
otherwise redisseminate the Electronic Services, any content associated therewith, or any portion
thereof (including, without limitation, any trademarks and service marks associated therewith),
without the written consent of the Trustee. Notwithstanding the foregoing, the Trustee acknowledges
that certain Electronic Services may, by their nature, be intended for noncommercial, personal use
by Participants or their beneficiaries, with respect to their participation in the Plan, or for
their other retirement or employee benefit planning purposes, and certain content may be intended
or permitted to be modified by the Sponsor in connection with the administration of the Plan. In
such cases, the Trustee will notify the Sponsor of such fact, and any requirements or guidelines
associated with such usage or modification no later than the time of initial delivery of such
Electronic Services. To the extent permission is granted to make Electronic Services available to
administrative personnel designated by the Sponsor, it shall be the responsibility of the Sponsor
to keep the Trustee informed as to which of the Sponsor personnel are authorized to have such
access. Except to the extent otherwise specifically agreed by the parties, the Trustee reserves the
right, upon notice when reasonably feasible, to modify or discontinue Electronic Services, or any
portion thereof, at any time.

          (b) Without limiting the responsibilities of the Trustee or the rights of the Sponsor stated
elsewhere in this Agreement, Electronic Services shall be provided to the Sponsor without
acceptance of legal liability related to or arising out of the electronic nature of the delivery or
provision of such Services. To the extent that any Electronic Services utilize Internet services to
transport data or communications, the Trustee will take, and the Sponsor agrees to follow,
reasonable security precautions. However, the Trustee disclaims any liability for interception of
any such data or communications. The Trustee reserves the right not to accept data or
communications transmitted electronically or via electronic media by the Sponsor or a third party
if it determines that the method of delivery does not provide adequate data security, or if it is
not administratively feasible for the Trustee to use the data security provided. The Trustee shall
not be responsible for, and makes no warranties regarding access, speed or availability of Internet
or network services, or any other service required for electronic communication, nor does the
Trustee make any warranties, express or implied, and specifically disclaims all warranties of
merchantability, fitness for a particular purpose, or non-infringement. The Trustee shall not be
responsible for any loss or damage related to or resulting from any changes or modifications to the
Electronic Services made in violation of this Agreement.

          (d) The Sponsor acknowledges that certain web sites through which the Electronic Services are
accessed may be protected by passwords or require a login and the Sponsor agrees that neither the
Sponsor nor, where applicable, Participants, will obtain or attempt to obtain unauthorized access
to such Services or to any other protected materials or information, through any means not
intentionally made available by the Trustee for the specific use of the Sponsor. To the extent that
a PIN is necessary for access to the Electronic Services, the Sponsor and/or its Participants, as
the case may be, are solely responsible for all activities that occur in connection with such PINs.

          (e) The Trustee will provide to Participants the FullViewSM service via
NetBenefits, through which Participants may elect to consolidate and manage any retirement account
information available through NetBenefits as well as External Account Information. To the extent
not provided by the Trustee or its affiliates, the data aggregation service will be provided by
Yodlee.com, Inc. or such other independent provider as the Trustee may select, pursuant to a
contract that requires the provider to take appropriate steps to protect the privacy and
confidentiality of information furnished by users of the service. The Sponsor acknowledges that
Participants who elect to use FullViewSM must provide passwords and PINs to the provider
of

16

 

data aggregation services. The Trustee will use External Account Information to furnish and support
FullViewSM or other services provided pursuant to this Agreement, and as otherwise
directed by the Participant. The Trustee will not furnish External Account Information to any third
party, except pursuant to subpoena or other applicable law. The Sponsor agrees that the information
accumulated through FullViewSM shall not be made available to the Sponsor, provided,
however, that the Trustee shall provide to the Sponsor, upon request, aggregate usage data that
contains no personally identifiable information.

Section 16. Assignment.

This Agreement, and any of its rights and obligations hereunder, may not be assigned by any party
without the prior written consent of the other party(ies), and such consent may be withheld in any
party’s sole discretion. Notwithstanding the foregoing, Trustee may assign this Agreement in whole
or in part, and any of its rights and obligations hereunder, to a subsidiary or affiliate of
Trustee without consent of the Sponsor. All provisions in this Agreement shall extend to and be
binding upon the parties hereto and their respective successors and permitted assigns.

Section 17. Force Majeure.

No party shall be deemed in default of this Agreement to the extent that any delay or failure in
performance of its obligation(s) results, without its fault or negligence, from any cause beyond
its reasonable control, such as acts of God, acts of civil or military authority, acts of
terrorism, whether actual or threatened, quarantines, embargoes, epidemics, war, riots,
insurrections, fires, explosions, earthquakes, floods, unusually severe weather conditions, power
outages or strikes. This clause shall not excuse any of the parties to the Agreement from any
liability which results from failure to have in place reasonable disaster recovery and safeguarding
plans adequate for protection of all data each of the parties to the Agreement are responsible for
maintaining for the Plan.

Section 18. Confidentiality.

Both parties to this Agreement recognize that in the course of implementing and providing the
services described herein, each party may disclose to the other Confidential Information. All such
Confidential Information, individually and collectively, and other proprietary information
disclosed by either party shall remain the sole property of the party disclosing the same, and the
receiving party shall have no interest or rights with respect thereto if so designated by the
disclosing party to the receiving party. Each party agrees to maintain all such Confidential
Information in trust and confidence to the same extent that it protects its own proprietary
information, and not to disclose such Confidential Information to any third party without the
written consent of the other party. Each party further agrees to take all reasonable precautions to
prevent any unauthorized disclosure of Confidential Information. In addition, each party agrees not
to disclose or make public to anyone, in any manner, the terms of this Agreement, except as
required by law, without the prior written consent of the other party. Notwithstanding the
foregoing, Trustee may use Sponsor’s name in a general list of its customers, including any such
list compiled for Fidelity Investment’s annual report to shareholders, without obtaining Sponsor’s
prior consent.

17

 

Section 19. General.

          (a) Performance by Trustee, its Agents or Affiliates.

The Sponsor acknowledges and authorizes that the services to be provided under this Agreement shall
be provided by the Trustee, its agents or affiliates, and that certain of such services may be
provided pursuant to one or more other contractual agreements or relationships.

          (b) Entire Agreement.

This Agreement, together with the Schedules referenced herein, contains all of the terms agreed
upon between the parties with respect to the subject matter hereof. This Agreement supersedes any
and all other agreements, written or oral, made by the parties with respect to the services.

          (c) Waiver.

No waiver by either party of any failure or refusal to comply with an obligation hereunder shall be
deemed a waiver of any other obligation hereunder or subsequent failure or refusal to comply with
any other obligation hereunder.

          (d) Successors and Assigns.

The stipulations in this Agreement shall inure to the benefit of, and shall bind, the successors
and assigns of the respective parties,

          (e) Partial Invalidity.

If any term or provision of this Agreement or the application thereof to any person or
circumstances shall, to any extent, be invalid or unenforceable, the remainder of this Agreement,
or the application of such term or provision to persons or circumstances other than those as to
which it is held invalid or unenforceable, shall not be affected thereby, and each term and
provision of this Agreement shall be valid and enforceable to the fullest extent permitted by law.

          (f) Section Headings.

The headings of the various sections and subsections of this Agreement have been inserted only for
the purposes of convenience and are not part of this Agreement and shall not be deemed in any
manner to modify, explain, expand or restrict any of the provisions of this Agreement.

          (g) Communications.

In the event that the Sponsor retains any responsibility for delivering Participant communications
to some or all Participants and beneficiaries, the Sponsor agrees to furnish the communications to
such Participants in a timely manner as determined under applicable law. The Sponsor also
represents that such communications will be delivered to such Participants and beneficiaries in a
manner permitted by applicable law, including electronic delivery that is consistent with
applicable regulations regarding electronic transmission (for example, DOL Regulation

18

 

§2520.104b-1). The Trustee and its affiliates shall have no responsibility or liability for any
Losses resulting from the failure of the Sponsor to furnish any such communications in a manner
which is timely and consistent with applicable law.

The provisions of this Agreement shall apply to all information provided and all Participant
communications prepared and delivered by the Sponsor or the Trustee during the implementation
period prior to the execution date of this Agreement and throughout the term set forth in this
Agreement.

          (h) Survival.

Trustee’s and Sponsor’s respective obligations under this Agreement, which by their nature would
continue beyond the termination of this Agreement, including but not limited to those contained in
Sections 6(c), 8(d), 18 and 20 shall survive any termination of the Agreement.

Section 20. Use of Data.

In order to fulfill its obligations under this Agreement, the Trustee may receive personal data,
including but not limited to, compensation, benefits, tax, marital/family status and other similar
information, about Participants (“Personal Data”). With respect to Personal Data it receives, the
Trustee agrees to (i) safeguard Personal Data in accordance with its privacy policy, and (ii)
exercise the same standard of care in safeguarding such Personal Data that it uses to protect the
personal data of its own employees. Notwithstanding the foregoing, the Sponsor may monitor the
Trustee’s interactions with Participants and the Sponsor authorizes the Trustee to permit
third-party prospects of the Trustee to monitor Participants’ interactions for the purpose of
evaluating Trustee’s services.

Section 21. Other Services.

The Sponsor hereby authorizes the Trustee and its affiliates to provide Participants with
communications about goal-based planning services, tools and products offered by the Trustee or its
affiliates, including but not limited to multi-goal savings and investment planning, guidance and
retirement income management. Such programs may include print communication material, web-based
materials, email and/or related outbound calls, as well as workshops, seminars, and one-on-one
meetings, which may be supported by one or more affiliates of the Trustee including Fidelity
Brokerage Services LLC (“FBSLLC”). Program communications may be directed to Participant
populations based on potential Participant needs, taking into account Participant age and deferral
rate, among other factors.

For purposes of both facilitating these communications and providing goal-based planning services,
tools and products to Participants, the Sponsor authorizes the Trustee and its affiliates to
provide FBSLLC, and/or other affiliates or agents of the Trustee, with access to the Plan’s terms
and provisions and to individual Plan account information of Participants, provided that such
affiliates and agents shall safeguard such data in accordance with the Trustee’s privacy policy.
The Sponsor acknowledges that, as part of this program, Participants may consent to have services
provided to them by FBSLLC and/or other affiliates.

19

 

Section 22. Governing Law.

          (a) Massachusetts Law Controls.

This Agreement is being made in the Commonwealth of Massachusetts, and the Trust shall be
administered as a Massachusetts trust. The validity, construction, effect, and administration of
this Agreement shall be governed by and interpreted in accordance with the laws of the Commonwealth
of Massachusetts, except to the extent those laws are superseded under section 514 of ERISA.

          (b) Trust Agreement Controls.

The Trustee is not a party to the Plan, and in the event of any conflict between the provisions of
the Plan and the provisions of this Agreement, the provisions of this Agreement shall control.

20

 

IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed by their duly
authorized officers as of the day and year first above written. By signing below, the undersigned
represent that they are authorized to execute this Agreement on behalf of the respective parties.
Each party may rely without duty of inquiry on the foregoing representation.

THE SHAW GROUP, INC.

	 	 	 	 	 
	 	 	 
	By:  	/s/ Martin J. Eickler
 	 	 
	 	Its Authorized Signatory  	 	 
	 	Name:  	Martin J. Eickler	 
	 	Title:	Director of Benefits	 
	 	Date:	 12/14/06	 
	 

FIDELITY MANAGEMENT TRUST COMPANY

	 	 	 	 	 
	 	 	 
	By:  	
 	 	 
	 	Its Authorized Signatory 	 	 
	 	Name:  	 	 	 
	 	Date:  	 	 	 

21

 

	 	 	 	 	 

SCHEDULES

Schedule “A” Recordkeeping and Administrative Services

Administration

	*	 	Establishment and maintenance of Participant account and election percentages.
	 
	*	 	Maintenance of the Plan investment options set forth on Schedule “C”.
	 
	*	 	Maintenance of the money classifications set forth in the Plan Administration Manual.
	 
	*	 	The Trustee will provide the recordkeeping and administrative services set forth on this Schedule
“A” or as otherwise agreed to in writing (or by means of a secure electronic medium) between
Sponsor and Trustee. The Trustee may unilaterally add or enhance services, provided there is no
impact on the fees set forth in Schedule “B.”

A) Participant Services

	 	1)	 	Participant service representatives are available each Business Day at the times
set forth in the Plan Administration Manual via toll free telephone service for
Participant inquiries and transactions.
	 
	 	2)	 	Through the automated voice response system and on-line account access via the
world wide web, Participants also have virtually 24 hour account inquiry and transaction
capabilities.
	 
	 	3)	 	For security purposes, all calls are recorded. In addition, several levels of
security are available including the verification of a PIN or such other personal
identifier as may be agreed to from time to time by the Sponsor and the Trustee.
	 
	 	4)	 	The following services are available via the telephone or such other electronic
means as may be agreed upon from time to time by the Sponsor and the Trustee:

	 	•	 	Process Participant enrollments, in accordance with the procedures set forth in
the Plan Administration Manual.
	 
	 	•	 	Provide Plan investment option information.
	 
	 	•	 	Provide and maintain information and explanations about Plan provisions.
	 
	 	•	 	Respond to requests for literature.
	 
	 	•	 	Maintain and process changes to Participants’ contribution allocations for all
money sources, if applicable.
	 
	 	•	 	Process exchanges (transfers) between investment options on a daily basis.

22

 

	B)	 	Plan Accounting

	 	1)	 	Process consolidated payroll contributions according to the Sponsor’s payroll
frequency via EDT, consolidated magnetic tape or diskette. The data format will be
provided by the Trustee.
	 
	 	2)	 	Maintain and update employee data necessary to support Plan administration. The
data will be submitted according to payroll frequency.
	 
	 	3)	 	Provide daily Plan and Participant level accounting for all Plan investment
options.
	 
	 	4)	 	Provide daily Plan and Participant level accounting for all money classifications
for the Plan.
	 
	 	5)	 	Audit and reconcile the Plan and Participant accounts daily.
	 
	 	6)	 	Reconcile and process Participant withdrawal requests and distributions as approved
and directed by the Sponsor. All requests are paid based on the current market values of
Participants’ accounts, not advanced or estimated values. A distribution report will
accompany each check.
	 
	 	7)	 	Maintain and process changes to Participants’ existing hypothetical investment mix
elections.

	C)	 	Participant Reporting

	 	1)	 	Provide confirmation to Participants of all Participant initiated transactions
either online or via the mail. Online confirms are generated upon submission of a
transaction and mail confirms are available by mail generally within five (5) calendar
days of the transaction.
	 
	 	2)	 	Provide Participant statements in accordance with the procedures set forth in the
Plan Administration Manual.

	D)	 	Plan Reporting

	 	1)	 	Prepare, reconcile and deliver a monthly Trial Balance Report presenting all money
classes and investments. This report is based on the market value as of the last business
day of the month. The report will be delivered not later than twenty (20) calendar days
after the end of each month in the absence of unusual circumstances.

	E)	 	Government Reporting

	 	1)	 	Provide federal and state tax reporting and withholding on benefit payments made to
Participants and beneficiaries in accordance with this Agreement.
	 
	 	2)	 	Provide Mutual Fund tax reporting (Forms 1099 DIV. and 1099-B) to the Sponsor.

23

 

	F)	 	Communication & Education Services

	 	1)	 	Design, produce and distribute a customized comprehensive communications program
for employees. The program may include multimedia informational materials, investment
education and planning materials, access to Fidelity’s homepage on the internet and
STAGES magazine. Additional fees for such services may apply as mutually agreed upon
between Sponsor and Trustee.
	 
	 	2)	 	Provide Portfolio Review an internet-based educational service for Participants
that generates target asset allocations and model portfolios customized to investment
options in the Plan based upon methodology provided by Strategic Advisers, Inc., an
affiliate of the Trustee.

	G)	 	Other

	 	1)	 	Plan Sponsor Webstation: The Fidelity Participant Recordkeeping System is
available on-line to the Sponsor via the Plan Sponsor Webstation. PSW is a graphical,
Windows-based application that provides current Plan and Participant-level information,
including indicative data, account balances, activity and history. The Sponsor agrees
that PSW access will not be granted to third parties without the prior consent of the
Trustee.
	 
	 	2)	 	Change of Address by Telephone: The Trustee shall allow Participants as
directed by the Sponsor and documented in the Plan Administration Manual, to make address
changes via Fidelity’s toll-free telephone service.

	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	THE SHAW GROUP, INC.	 	 	 	FIDELITY MANAGEMENT
TRUST COMPANY	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	By:

	 	/s/ Martin J. Eickler
	 	12/14/06
	 	 	 	By:	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	 	 	 
	 

	 	Its Authorized
Signatory
	 	Date
	 	 	 	 	 	Its Authorized
Signatory
	 	Date	 	 

24

 

Schedule “B” Fee Schedule

[CHOOSE ONE]

	 	 	 
	Annual Participant Fee:

	 	Fee Waived
	 
	 	 
	Non-Fidelity Mutual Funds:

	 	Fees paid directly to Fidelity Investments
Institutional Operations Company, Inc. (FIIOC)
or its affiliates by Non-Fidelity Mutual Fund
vendors shall be posted and updated quarterly
on Plan Sponsor Webstation at
https://psw.fidelity.com or a successor site.

Other Fees:

	•	 	Other Fees: separate charges may apply for extraordinary expenses resulting from large
numbers of simultaneous manual transactions, from errors not caused by Fidelity, reports not
contemplated in this Agreement, corporate actions, or the provision of communications
materials in hard copy which are also accessible to participants via electronic services in
the event that the provision of such material in hard copy would result in an additional
expense deemed to be material. The Administrator may withdraw reasonable administrative fees
from the Trust by written direction to Fidelity.

Note: Assumptions — These fees have been negotiated and accepted based on current
participation of 500 Participants. Fees may be subject to revision, upon mutual renegotiation, if
these Plan characteristics change significantly by either falling below or exceeding current or
projected levels.

	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	THE SHAW GROUP, INC.	 	 	 	FIDELITY MANAGEMENT
TRUST COMPANY	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	By:

	 	/s/ Martin J. Eickler
	 	12/14/06
	 	 	 	By:	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	 	 	 
	 

	 	Its Authorized
Signatory
	 	Date
	 	 	 	 	 	Its Authorized
Signatory
	 	Date	 	 

25

 

Schedule “C” Investment Options

In accordance with Section 5(b), the Sponsor hereby directs the Trustee that Participants’
individual hypothetical accounts may be invested in the following investment options:

	 	•	 	PIMCO Total Return Fund — Administrative Class
	 
	 	•	 	Fidelity Freedom 2005 Fund®
	 
	 	•	 	Fidelity Freedom 2010 Fund®
	 
	 	•	 	Fidelity Freedom 2015 Fund®
	 
	 	•	 	Fidelity Freedom 2025 Fund®
	 
	 	•	 	Fidelity Freedom 2035 Fund®
	 
	 	•	 	Fidelity Freedom 2040 Fund®
	 
	 	•	 	Fidelity Freedom 2050 Fund®
	 
	 	•	 	Spartan® US Equity Index Fund — Investor Class
	 
	 	•	 	American Funds® Growth Fund of America® — Class R4
	 
	 	•	 	Fidelity Value Fund
	 
	 	•	 	American Funds® EuroPacific Growth Fund® — Class R4
	 
	 	•	 	Dodge & Cox Stock Fund
	 
	 	•	 	Rainier Small/Mid Cap Equity Portfolio — Investor Class
	 
	 	•	 	Mainstay Small Cap Opportunity Fund — Class I
	 
	 	•	 	Columbia Acorn USA Fund — Class Z
	 
	 	•	 	Spartan® Extended Market Index Fund — Investor Class
	 
	 	•	 	Spartan International Index — Investor Class
	 
	 	•	 	Fidelity Money Market Trust Retirement Money Market Portfolio

The Sponsor hereby directs that the investment option referred to in Section 5(c) shall be the
Fidelity Money Market Trust Retirement Money Market Portfolio.

	 	 	 	 	 	 	 
	THE SHAW GROUP, INC.	 	 
	 
	 	 	 	 	 	 
	By:

	 	/s/ Martin J. Eickler
	 	12/14/06	 	 
	 	 	 	 	 
	 

	 	Its Authorized Signatory
	 	Date	 	 

26

 

Schedule “D” Operational Guidelines for Non-Fidelity Mutual Funds

Pricing

By 7:00 p.m. Eastern Time (“ET”) each Business Day, the Non-Fidelity Mutual Fund Vendor (“Fund
Vendor”) will input the following information (“Price Information”) into the Fidelity Participant
Recordkeeping System (“FPRS”) via the remote access price screen that FIIOC, an affiliate of the
Trustee, has provided to the Fund Vendor: (1) the NAV for each Fund at the Close of Trading, (2)
the change in each Fund’s NAV from the Close of Trading on the prior Business Day, and (3) in the
case of an income fund or funds, the daily accrual for interest rate factor (“mil rate”). FIIOC
must receive Price Information each Business Day. If on any Business Day the Fund Vendor does not
provide such Price Information to FIIOC, FIIOC shall pend all associated transaction activity in
the FPRS until the relevant Price Information is made available by Fund Vendor.

Trade Activity and Wire Transfers

By 7:00 a.m. ET each Business Day following Trade Date (“Trade Date Plus One”), FIIOC will
provide, via facsimile, to the Fund Vendor a consolidated report of net purchase or net redemption
activity that occurred in each of the Funds up to 4:00 p.m. ET on the prior Business Day. The
report will reflect the dollar amount of assets and shares to be invested or withdrawn for each
Fund. FIIOC will transmit this report to the Fund Vendor each Business Day, regardless of
processing activity. In the event that data contained in the 7:00 a.m. ET facsimile transmission
represents estimated trade activity, FIIOC shall provide a final facsimile to the Fund Vendor by no
later than 9:00 a.m. ET. Any resulting adjustments shall be processed by the Fund Vendor at the net
asset value for the prior Business Day.

The Fund Vendor shall send via regular mail to FIIOC transaction confirms for all daily activity in
each of the Funds. The Fund Vendor shall also send via regular mail to FIIOC, but no later than the
fifth Business Day following calendar month close, a monthly statement for each Fund. FIIOC agrees
to notify the Fund Vendor of any balance discrepancies within twenty (20) Business Days of receipt
of the monthly statement.

For purposes of wire transfers, FIIOC shall transmit a daily wire for aggregate purchase activity
and the Fund Vendor shall transmit a daily wire for aggregate redemption activity, in each case
including all activity across all Funds occurring on the same day.

Prospectus Delivery

FIIOC shall be responsible for the timely delivery of Fund prospectuses and periodic Fund reports
(“Required Materials”) to Participants, and shall retain the services of a third-party vendor to
handle such mailings. The Fund Vendor shall be responsible for all materials and production costs,
and hereby agrees to provide the Required Materials to the third-party vendor selected by FIIOC.
The Fund Vendor shall bear the costs of mailing annual Fund reports to Participants. FIIOC shall
bear the costs of mailing prospectuses to Participants.

27

 

Proxies

The Fund Vendor shall be responsible for all costs associated with the production of proxy
materials. FIIOC shall retain the services of a third-party vendor to handle proxy solicitation
mailings and vote tabulation. Expenses associated with such services shall be billed directly the
Fund Vendor by the third-party vendor.

Participant Communications

The Fund Vendor shall provide internally prepared fund descriptive information approved by the
Funds’ legal counsel for use by FIIOC in its written Participant communication materials. FIIOC
shall utilize historical performance data obtained from third-party vendors (currently Morningstar,
Inc., FACTSET Research Systems and Lipper Analytical Services) in telephone conversations with
Participants and in quarterly Participant statements. The Sponsor hereby consents to FIIOC’s use of
such materials and acknowledges that FIIOC is not responsible for the accuracy of third-party
information. FIIOC shall seek the approval of the Fund Vendor prior to retaining any other
third-party vendor to render such data or materials under this Agreement.

Compensation

FIIOC shall be entitled to fees as set forth in a separate agreement with the Fund Vendor.

28

 

The Shaw Group Inc.

4171 Essen Lane

Baton Rouge, LA 70809

225.932.2500

	 	 	 
	

	 	The Shaw Group Inc.®
	 

	 	 

FESCO Business Compliance, Attn: Contracts.

Fidelity Investments

82 Devonshire Street, MM3H

Boston, MA 02109

     Re: Investment Instructions for Rabbi Trust Assets

Dear Fidelity:

     The Participants under the Shaw Group Deferred Compensation Plan (“Plan”) have the right to
direct the investment of their Plan account in hypothetical investment options, which are currently
based on Mutual Funds. Fidelity Management Trust Company has agreed pursuant to a Trust Agreement
with the Shaw Group Inc., dated January 2, 2007, to receive such Participant directions.

     The Sponsor hereby directs the Trustee to invest funds contributed to the rabbi trust in a
manner which corresponds directly to elections made by Participants under the Plan. The Sponsor
also hereby directs the Trustee to vote the shares of Fidelity and Non-Fidelity Mutual Funds and
vote and/or tender shares of Sponsor Stock in the same manner as directed by the Participants for
the corresponding hypothetical shares credited to Participants’ accounts under the Plan.

     These procedures will remain in effect until a revised instruction letter is provided by the
Sponsor and accepted by the Trustee.

	 	 	 	 	 
	 	Sincerely,

 	 
	 	/s/ Martin. J. Eickler
 	 
	 	Its Authorized Signatory 	 
	 	(w/enc.) 	 
	 

29

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