September 24, 1999
Mr. Jim Rollans
President and Chief Executive Officer
Fluor Signature Services
Dear Jim,
It is my pleasure to inform you that at the December 1998 Organization and
Compensation Committee meeting, the Board of Directors of Fluor Corporation (the
"Company") selected you to participate in a Retention Program. The amount of
the retention award was $2,750,000. At your request the award has been
structured as follows:
Award Amount: $2,750,000
Retention Period: October 1, 1998 through October 31, 2001
Retention Agreement: The Award Amount is divided between the following two
components:
Housing
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You have previously been provided with a personal loan of
$1,627,576 secured by a deed of trust on your residence.
The loan provides for an interest rate of 4.52%,
compounded annually with a balloon payment of the entire
amount due on termination of employment. The loan
presently states that it is subject to acceleration in the
event of your termination of employment for any reason
prior to October 31, 2001. The Company will forgive the
loan including accrued interest in its entirety (a) if you
remain continuously employed by the Company until October
31, 2001, or (b) if your employment terminates prior to
that date due to (i) death, (ii) permanent and total
disability, (iii) a Company-initiated termination for any
reason other than for-cause or (iv) following a Change of
Control. If your employment with the Company terminates
for any other reason prior to October 31, 2001 (including,
without
Jim Rollans
September 24, 1999
Page 2
limitation, your voluntary termination or a termination
for cause) then this loan shall remain in effect in
accordance with its terms.
For purposes hereof, the term "Change of Control" shall be
deemed to have occurred if, (a) a third person, including
a "group" as defined in Section 13(d)(3) of the Securities
Exchange Act of 1934, acquires shares of the Company
having 25% or more of the votes that may be cast for the
election of directors of the Company or (b) as a result of
any cash tender or exchange offer, merger or other
business combination, or any combination of the preceding
(a "transaction"), the persons who are the directors of
the Company before the transaction shall cease to
constitute a majority of the Board of Directors of the
Company or any successor thereto.
Accrual to Executive Deferral Compensation Program
--------------------------------------------------
("EDCP")
--------
You may earn $1,122,424, said amount to be adjusted as
provided below, if you remain continuously employed by the
Company until on or after October 31, 2001 (the "EDCP
Accrual"). During the period from October 1, 1998 to the
date upon which the EDCP Accrual vests (if at all), you
will also be entitled to invest the EDCP Accrual by
selecting one or more of the crediting options contained
in the EDCP. Thereafter, the amount of your EDCP Accrual,
if vested, shall be adjusted based upon the investment
return that you would have otherwise received had the EDCP
Accrual been actually earned as of October 1, 1998 and
credited in your EDCP account based upon your chosen
crediting option through the date of vesting. If no
crediting option is indicated, the EDCP Accrual will be
automatically credited as if you chose the Money Market
crediting option under the EDCP.
The EDCP Accrual, as adjusted, will vest and be credited
to your existing Company EDCP account (a) if you remain
continuously employed by the Company until October 31,
2001 or (b) if your employment terminates prior to that
date due to (i) death, (ii) permanent and total
disability, (iii) a Company-
Jim Rollans
September 24, 1999
Page 3
initiated termination other than on a for-cause basis or
(iv) following a Change of Control. If in the event your
employment terminates for any reason prior to any such
vesting date for any other reason (including, without
limitation, your voluntary termination or a termination
for cause), then the EDCP Accrual, as adjusted, will be
forfeited.
Please indicate your acknowledgment of the terms of the letter by signing in the
space provided and returning the original to me for your employee records. You
should also retain a copy for your file.
If you should have any questions, please give me a call at (949) 349-2000.
Sincerely,
Philip J. Carroll
Agreed by: Agreed by:
/s/ PHILIP J. CARROLL /s/ JAMES O. ROLLANS
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Philip J. Carroll James O. Rollans
Retention Program Participation Letter - Fluor Corp. and Jim Rollans
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