SHAW GROUP INC
EX-10.1
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<TYPE>EX-10.1
<SEQUENCE>2
<FILENAME>exhibit1.htm
<DESCRIPTION>EX-10.1
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<P align="center" style="font-size: 10pt"><FONT style="font-size: 12pt"> <B>AMENDED &#038; RESTATED EMPLOYMENT AGREEMENT</B></FONT>



<P align="left" style="font-size: 12pt; text-indent: 4%">This Amended &#038; Restated Employment Agreement (this &#147;<U>Agreement</U>&#148;) is entered into
December&nbsp;31, 2008, but is effective as of January&nbsp;1, 2008 (the &#147;<U>Effective Date</U>&#148;), by and
between The Shaw Group Inc., a Louisiana corporation (collectively with its affiliates and
subsidiaries hereinafter referred to as &#147;<U>Company</U>&#148;), and J.M. Bernhard, Jr.
(&#147;<U>Employee</U>&#148;). The Company and Employee may hereinafter be referred to, individually, as a
&#147;<U>Party</U>&#148; and, collectively, as the &#147;<U>Parties</U>&#148;.


<P align="left" style="font-size: 12pt; text-indent: 4%"><B>WHEREAS</B>, the Company and Employee are parties to that certain Employment Agreement dated as of
January&nbsp;23, 2007 (the &#147;<U>Original Agreement</U>&#148;); and


<P align="left" style="font-size: 12pt; text-indent: 4%"><B>WHEREAS</B>, the Company and Employee desire to amend certain provisions of the Original Agreement
and to restate the Original Agreement in its entirety.


<P align="left" style="font-size: 12pt; text-indent: 4%"><B>NOW, THEREFORE</B>, 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:


<P align="left" style="font-size: 12pt; text-indent: 4%">1.&nbsp;<U>Employment</U>. The Company continues to employ Employee, and Employee hereby agrees
to continued employment by the Company, on the terms and conditions set forth in this Agreement.


<P align="left" style="font-size: 12pt; text-indent: 4%">2.&nbsp;<U>Term of Employment</U>. Subject to the provisions for earlier termination provided in
Section&nbsp;7 of this Agreement, the term of this Agreement (the &#147;<U>Term</U>&#148;) shall be three (3)
years, commencing on the Effective Date, and shall be automatically renewed on each day following
the Effective Date so that on any given day the unexpired portion of the Term shall be three (3)
years.


<P align="left" style="font-size: 12pt; text-indent: 4%">3.&nbsp;<U>Employee&#146;s Duties</U>.


<P align="left" style="font-size: 12pt; text-indent: 8%">(a)&nbsp;During the Term, Employee shall serve as the Chairman of the Board of Directors, President
&#038; Chief Executive Officer of the Company, with such duties and responsibilities as may from time to
time be assigned to him by the Board of Directors of the Company (the &#147;<U>Board</U>&#148;), provided
that such duties are consistent with the customary duties of such position.


<P align="left" style="font-size: 12pt; text-indent: 8%">(b)&nbsp;Employee agrees to devote a substantial amount of his 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 be
prohibited from making financial investments in any other company or business or from serving on
the board of directors of any other company, so long as such does not interfere with Employee&#146;s
fiduciary duties to the Company. Employee shall at all times observe and comply with all lawful
directions and instructions of the Board.


<P align="left" style="font-size: 12pt; text-indent: 8%">(c)&nbsp;Employee&#146;s place of business shall be at the Company&#146;s principal executive offices in
Baton Rouge, Louisiana.


<P align="left" style="font-size: 12pt; text-indent: 4%">4.&nbsp;<U>Compensation</U>.


<P align="left" style="font-size: 12pt; text-indent: 8%">(a)&nbsp;<U>Base Compensation</U>. For services rendered by Employee under this Agreement, the
Company shall pay to Employee a base salary (&#147;<U>Base Compensation</U>&#148;) as set by the Board,
payable in accordance with the Company&#146;s customary pay periods and subject to customary
withholdings. Employee&#146;s Base Compensation shall 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&#146;s Base Compensation,
that increased amount shall thereafter be the Base Compensation for the purposes of this Agreement.
Employee&#146;s Base Compensation, as increased from time to time, may not thereafter be decreased
unless agreed to by Employee in writing.


<P align="left" style="font-size: 12pt; text-indent: 8%">(b)&nbsp;<U>Bonus</U>. Nothing contained herein shall prevent the Board from paying additional
compensation to Employee in the form of bonuses or otherwise during the Term. Employee shall be
entitled to participate in and receive bonus awards under any bonus program established by the
Company for its management or key personnel. In the absence of or in addition to such a program,
Employee shall be entitled to receive such bonus, if any, as may be determined from time to time by
the Board in its discretionary and sole judgment based on merit and the Company&#146;s performance.


<P align="left" style="font-size: 12pt; text-indent: 8%">(c)&nbsp;<U>Long Term Incentives</U>. Nothing contained herein shall prevent the Board from paying
additional compensation to Employee in the form of options, restricted shares or units or other
similar awards (&#147;<U>Long Term Incentives</U>&#148;) under any Company plan during the Term. Employee
shall be entitled to participate in and receive Long Term Incentives under any program established
by the Company for its management or key personnel.


<P align="left" style="font-size: 12pt; text-indent: 4%">5.&nbsp;<U>Additional Benefits</U>. In addition to the compensation provided for in Section&nbsp;4
herein, Employee shall be entitled to the following:


<P align="left" style="font-size: 12pt; text-indent: 8%">(a)&nbsp;<U>Expenses</U>. 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. The Company shall also reimburse Employee
for membership and initiation fees for clubs the Board deems reasonable in order for Employee to
carry out the duties set forth herein and, at the Board&#146;s discretion, provide Employee a mid-size
jet aircraft (which shall mean a jet aircraft comparable to or better than the jet aircraft
currently being used by Employee as of the Effective Date) for his personal use and benefit.
Requests for reimbursement for all business expenses must be accompanied by appropriate
documentation.


<P align="left" style="font-size: 12pt; text-indent: 8%">(b)&nbsp;<U>Automobile</U> <U>Allowance</U>. The Company shall provide Employee, for his business
and private use, with an automobile suitable to Employee&#146;s position. In addition, the Company
shall either directly pay or reimburse Employee for all costs of operating and maintaining such
automobile, including insurance thereon in accordance with Company policies.


<P align="left" style="font-size: 12pt; text-indent: 8%">(c)&nbsp;<U>Vacation</U>. Employee shall be entitled to a reasonable period of vacation per year
at his discretion, but not less than 5&nbsp;weeks, without any loss of compensation or benefits.
Employee shall be entitled to carry forward any unused vacation time.


<P align="left" style="font-size: 12pt; text-indent: 8%">(d)&nbsp;<U>General Benefits</U>. Employee and Employee&#146;s spouse and dependents shall be entitled
to participate in the various employee benefit plans or programs provided to employees (and their
families) of the Company in general, including, but not limited to, health, dental, disability,
accident and life insurance plans and 401k 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. Nothing in this Section 5(d) shall be deemed to prohibit
the Company from making any changes in any of the plans, programs or benefits described in this
Section&nbsp;5(d), provided the change similarly affects all executive officers (and their families) of
the Company that are similarly situated.


<P align="left" style="font-size: 12pt; text-indent: 4%">6.&nbsp;<U>Reserved</U>.


<P align="left" style="font-size: 12pt; text-indent: 4%">7.&nbsp;<U>Termination</U>.


<P align="left" style="font-size: 12pt; text-indent: 8%">(a)&nbsp;This Agreement may be terminated prior to the expiration of its Term only under the terms
and conditions set forth below:



<P align="left" style="margin-left:4%; font-size: 12pt; text-indent: 8%">(i) <U>Resignation (other than for Good Reason)</U>. Employee may resign his position
at any time, including by reason of retirement, by providing written notice of resignation
to the Company. In the event of such resignation, except in the case of resignation for
Good Reason (as defined below), this Agreement shall terminate on the Date of Termination
(defined in Section 7(c) below), and Employee shall not be entitled to further compensation
pursuant to this Agreement other than (A)&nbsp;the payment of any Base Compensation and General
Benefits (e.g., unused vacation, unreimbursed business expenses, etc.) accrued and unpaid as
of the Date of Termination, and (B)&nbsp;payments and benefits due under Section&nbsp;8(a).



<P align="left" style="margin-left:4%; font-size: 12pt; text-indent: 8%">(ii) <U>Death</U>. If Employee&#146;s employment is terminated due to his death, the
Company shall pay to Employee&#146;s surviving spouse or estate (in accordance with applicable
law), subject to customary withholdings, not later than 30&nbsp;days after Employee&#146;s death, (A)
any Base Compensation and General Benefits accrued and unpaid as of the date of Employee&#146;s
death, (B)&nbsp;a lump sum amount, in cash, equal to one year of Employee&#146;s Base Compensation,
(C)&nbsp;to the extent that, but for his death, Employee would have otherwise been entitled to a
bonus under any bonus plan then maintained by the Company, or to the extent that other
officers or Company executives are awarded bonuses or otherwise in the discretion of the
Board, a lump sum amount, in cash, equal to a pro rata bonus for the year of his death, (D)
a lump sum amount, in cash, equal to the amount due under Section&nbsp;8(a)(i), as a death
benefit, and (E)&nbsp;a lump sum amount, in cash, equal to the cost for Employee to obtain, for
the period commencing on the Date of Termination and ending on the date that is 30&nbsp;months
following the Date of Termination, health and dental insurance benefits covering Employee
and Employee&#146;s spouse and dependents that are substantially similar to those that Employee
(and Employee&#146;s spouse and dependents) were receiving immediately prior to the Date of
Termination. Notwithstanding any provision to the contrary in the plan(s) governing such
Long Term Incentives, Employee shall also be considered as immediately and totally vested in
any and all Long Term Incentives previously granted to Employee by Company prior to the Date
of Termination that have not previously vested in full. After all payments, benefits and
vesting of Long Term Incentives specified under this Section&nbsp;7(a)(ii) have been paid or
performed, this Agreement shall terminate, and the Company shall have no obligations to
Employee or his legal representatives with respect to this Agreement.



<P align="left" style="margin-left:4%; font-size: 12pt; text-indent: 8%">(iii) <U>Discharge</U>.



<P align="left" style="margin-left:8%; font-size: 12pt; text-indent: 7%">(A)&nbsp;The Company may terminate Employee&#146;s employment for any reason at any time
upon written notice thereof delivered to Employee in accordance with Section&nbsp;7(b).



<P align="left" style="margin-left:8%; font-size: 12pt; text-indent: 7%">(B)&nbsp;In the event that Employee&#146;s employment is terminated during the Term by
the Company for any reason other than his Misconduct or Disability (both as defined
below), the following shall occur:



<P align="left" style="margin-left:12%; font-size: 12pt; text-indent: 7%">(I)&nbsp;the Company shall pay to Employee, subject to customary
withholdings, not later than 15&nbsp;days after the Date of Termination:



<P align="left" style="margin-left:15%; font-size: 12pt; text-indent: 8%">(x)&nbsp;a lump sum amount, in cash, equal to the product of (1)&nbsp;the
sum of (a)&nbsp;Employee&#146;s Base Compensation as in effect immediately
prior to the Date of Termination, <U>plus</U> (b)&nbsp;Employee&#146;s highest
bonus paid by the Company during the three years immediately prior to
the Date of Termination, <U>multiplied by</U> (2)&nbsp;3.0;



<P align="left" style="margin-left:15%; font-size: 12pt; text-indent: 8%">(y)&nbsp;the amount due under Section&nbsp;8(a)(i); and



<P align="left" style="margin-left:15%; font-size: 12pt; text-indent: 8%">(z)&nbsp;a lump sum amount, in cash, equal to the cost for Employee
to obtain, for the three year period commencing on the Date of
Termination, disability, accident, dental and health insurance
benefits (&#147;Welfare Benefits&#148;) covering Employee (and, as applicable,
Employee&#146;s spouse and dependents) and other benefits provided to
Employee that, in each case, are substantially similar to those that
Employee (and/or Employee&#146;s spouse and dependents) were receiving
immediately prior to the Date of Termination; and



<P align="left" style="margin-left:12%; font-size: 12pt; text-indent: 7%">(II)&nbsp;notwithstanding any provision to the contrary in the plan(s)
governing such Long Term Incentives, Employee shall be considered as
immediately and totally vested in any and all Long Term Incentives
previously granted to Employee by the Company prior to the Date of
Termination.



<P align="left" style="margin-left:8%; font-size: 12pt; text-indent: 7%">(C)&nbsp;Notwithstanding anything to the contrary in this Agreement, 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 Base Compensation and General Benefits accrued and unpaid through the Date of
Termination and the payment due under Section&nbsp;8(a)(i). As used herein,
&#147;<U>Misconduct</U>&#148; means:



<P align="left" style="margin-left:12%; font-size: 12pt; text-indent: 7%">(I)&nbsp;the continued failure by Employee to substantially perform his
duties with the Company (other than any such failure resulting from
Employee&#146;s incapacity due to a Disability or any such actual or anticipated
failure after the issuance of a Notice of Termination by Employee for Good
Reason), after a written demand for substantial performance is delivered to
Employee by the Board, which demand specifically identifies the manner in
which the Board believes that Employee has not substantially performed his
duties and allows such 30&nbsp;days for Employee to effect any potential cure,



<P align="left" style="margin-left:12%; font-size: 12pt; text-indent: 7%">(II)&nbsp;the engaging by Employee in conduct which is demonstrably and
materially injurious to the Company, monetarily or otherwise (other than
such conduct resulting from Employee&#146;s incapacity due to physical or mental
illness and other than any such actual or anticipated conduct after the
issuance of a Notice of Termination by Employee for Good Reason), or



<P align="left" style="margin-left:12%; font-size: 12pt; text-indent: 7%">(III)&nbsp;Employee&#146;s conviction for the commission of a felony.



<P align="left" style="margin-left:8%; font-size: 12pt">A finding of Misconduct shall only be made by unanimous approval, excluding
Employee, of a resolution by the Board after a meeting called for such purpose upon
thirty (30)&nbsp;days&#146; notice to Employee, and at which Employee is entitled to appear
with counsel and be heard.



<P align="left" style="margin-left:8%; font-size: 12pt; text-indent: 7%">(D) <U>Disability</U>. If Employee shall have been absent from the full-time
performance of Employee&#146;s duties with the Company for 180 consecutive calendar days
as a result of Employee&#146;s incapacity due to a Disability, Employee&#146;s employment may
be terminated by the Company. For the purposes of this Agreement, a
&#147;<U>Disability</U>&#148; shall exist if:



<P align="left" style="margin-left:12%; font-size: 12pt; text-indent: 7%">(I)&nbsp;Employee is unable to engage in any substantial gainful activity by
reason of any medically determinable physical or mental impairment that can
be reasonably expected to result in death or can be expected to last for a
continuous period of not less than 12&nbsp;months; or



<P align="left" style="margin-left:12%; font-size: 12pt; text-indent: 7%">(II)&nbsp;Employee is, by reason of any medically determinable physical or
mental impairment that can be reasonably expected to result in death or can
be expected to last for a continuous period of not less than 12&nbsp;months,
receiving income replacement benefits for a period of not less than three
months under an accident and health plan covering employees of the Company.



<P align="left" style="margin-left:8%; font-size: 12pt">If Employee is terminated pursuant to this Section&nbsp;7(a)(iii)(D), Employee shall not
be entitled to further compensation pursuant to this Agreement, except that:



<P align="left" style="margin-left:12%; font-size: 12pt; text-indent: 3%">(w)&nbsp;the Company shall (1)&nbsp;for the 12&nbsp;month period beginning with the
Date of Termination, pay to Employee monthly the amount by which Employee&#146;s
monthly Base Compensation as in effect immediately prior to the Date of
Termination exceeds the monthly benefit received by Employee pursuant to any
disability insurance covering Employee; (2)&nbsp;not later than 15&nbsp;days after the
Date of Termination, pay to Employee (a)&nbsp;the amount due under Section
8(a)(i), (b)&nbsp;any Base Compensation and General Benefits accrued and unpaid
as of the Date of Termination, and (c)&nbsp;a lump sum amount, in cash, equal to
the cost for Employee to obtain, for the period commencing on the Date of
Termination and ending on the date that is 30&nbsp;months following the Date of
Termination, health and dental insurance benefits covering Employee and
Employee&#146;s spouse and dependents that are substantially similar to those
that Employee (and Employee&#146;s spouse and dependents) were receiving
immediately prior to the Date of Termination; and (3)&nbsp;to the extent that,
but for his Disability, Employee would have otherwise been entitled to a
bonus under any bonus plan then maintained by the Company, or to the extent
that other officers or Company executives are awarded bonuses, the Company
shall, not later than the earlier of (a)&nbsp;15&nbsp;days after the date on which the
Company awards such bonuses and (b)&nbsp;February&nbsp;28<sup>th</sup> of the calendar
year following the year in which the Date of Termination occurs, pay to
Employee a pro rata bonus for the year in which the Company terminates
Employee&#146;s employment pursuant to this Section&nbsp;7(a)(iii)(D);



<P align="left" style="margin-left:12%; font-size: 12pt; text-indent: 3%">(x)&nbsp;notwithstanding any provision to the contrary in the plan(s)
governing such Long Term Incentives, Employee shall become immediately and
totally vested in any and all Long Term Incentives granted to Employee by
Company prior to the Date of Termination that have not previously vested in
full; and



<P align="left" style="margin-left:12%; font-size: 12pt; text-indent: 3%">(y)&nbsp;the Company shall assign to Employee at no cost and with no
apportionment of any prepaid premiums of all assignable insurance policies
benefiting Employee.



<P align="left" style="margin-left:4%; font-size: 12pt; text-indent: 8%">(iv) <U>Resignation for Good Reason</U>. 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 Section
7(a)(iii)(B). For the purposes of this Agreement, the term &#147;<U>Good Reason</U>&#148; shall mean
the occurrence of any of the following circumstances without Employee&#146;s express written
consent:



<P align="left" style="margin-left:8%; font-size: 12pt; text-indent: 7%">(A)&nbsp;any material diminution of Employee&#146;s duties or responsibilities (other
than in connection with the termination of Employee for Misconduct or Disability in
accordance with the terms of this Agreement);



<P align="left" style="margin-left:8%; font-size: 12pt; text-indent: 7%">(B)&nbsp;any material diminution of Employee&#146;s Base Compensation;



<P align="left" style="margin-left:8%; font-size: 12pt; text-indent: 7%">(C)&nbsp;the relocation of the Company&#146;s principal executive offices outside Baton
Rouge, Louisiana or requiring Employee to be based other than at such principal
executive offices; or



<P align="left" style="margin-left:8%; font-size: 12pt; text-indent: 7%">(D)&nbsp;any other material breach by the Company of its obligations under this
Agreement;



<P align="left" style="margin-left:4%; font-size: 12pt"><U>provided</U>, <U>however</U>, Employee shall provide written notice (a &#147;<U>Good Reason
Notice</U>&#148;) to the Company of the initial existence of the condition causing the change in
terms or status no more than 90&nbsp;days after the change in terms or status occurs, and the
Company shall have 30&nbsp;days after receipt of the Good Reason Notice to resolve the issue
causing the change in terms or status. If the Company resolves such issue, then Employee&#146;s
employment shall not be subject to the Good Reason provisions of this Agreement as to such
issue.



<P align="left" style="margin-left:4%; font-size: 12pt; text-indent: 8%"><FONT style="font-size: 10pt">(v) </FONT><FONT style="font-size: 12pt"><U>Resignation for Corporate Change</U>. Employee shall be entitled to
terminate Employee&#146;s employment for a Corporate Change (as defined herein), but only if
Employee gives notice of Employee&#146;s intent to terminate employment within 90&nbsp;days following
the effective date of such Corporate Change (provided that, notwithstanding the foregoing,
the Notice of Termination may not be given later than February&nbsp;13th of the year following
the year in which the Corporate Change occurs). If Employee terminates employment for a
Corporate Change, Employee shall be entitled to the compensation and benefits provided in
Section&nbsp;7(a)(iii)(B). For the purposes of this Agreement, the term &#147;Corporate Change&#148; means
a &#147;change in ownership,&#148; a &#147;change in effective control,&#148; or a &#147;change in the ownership of
substantial assets&#148; of the Company.
</FONT>


<P align="left" style="margin-left:8%; font-size: 12pt; text-indent: 8%">(A)&nbsp;A &#147;change in ownership&#148; of the Company occurs on the date that any one
person, or more than one person acting as a group, acquires ownership of stock of
the Company that, together with stock held by such person or group, constitutes more
than 50% of the total fair market value or total voting power of the stock of the
Company. However, if any one person, or more than one person acting as a group, is
considered to own more than 50% percent of the total fair market value or total
voting power of the stock of the Company, the acquisition of additional stock by the
same person or persons is not considered to cause a change in ownership of the
Company (or to cause a change in the effective control of the Company (within the
meaning of Section&nbsp;7(v)(B)).



<P align="left" style="margin-left:8%; font-size: 12pt; text-indent: 8%">(B)&nbsp;Notwithstanding that the Company has not undergone a change in ownership
under Section&nbsp;7(v)(A), a &#147;change in effective control&#148; of the Company occurs on the
date that a majority of members of the Board is replaced during any 12-month period
by directors whose appointment or election is not endorsed by a majority of the
members of the Board prior to the date of the appointment or election. For purposes
of this Section&nbsp;7(v)(B), the term &#147;Company&#148; refers solely to the relevant
corporation identified in the opening paragraph of this Agreement, for which no
other corporation is a majority shareholder.



<P align="left" style="margin-left:8%; font-size: 12pt; text-indent: 7%">(C)&nbsp;A &#147;change in the ownership of substantial assets&#148; of the Company occurs on
the date that any one person, or more than one person acting as a group, acquires
(or has acquired during the 12-month period ending on the date of the most recent
acquisition by such person or persons) assets from the Company that have a total
gross fair market value equal to or more than 75% percent of the total gross fair
market value of all of the assets of the Company immediately prior to such
acquisition or acquisitions. For this purpose, &#147;gross fair market value&#148; means the
value of the assets of the Company, or the value of the assets being disposed of,
determined without regard to any liabilities associated with such assets.


<P align="left" style="font-size: 12pt; text-indent: 8%">(b)&nbsp;<U>Notice of Termination</U>. Any purported termination of Employee&#146;s employment by the
Company under Section&nbsp;7(a)(iii), or by Employee under Sections&nbsp;7(a)(i) or (iv), shall be
communicated by written Notice of Termination to the other Party hereto in accordance with Section
11. A Notice of Termination shall not be required in connection with a termination by Employee
under Section&nbsp;7(a)(v). For the purposes of this Agreement, a &#147;<U>Notice of Termination</U>&#148; shall
mean a notice that (i)&nbsp;in the case of a termination by the Company, shall set forth in reasonable
detail the reason for such termination of Employee&#146;s employment and the Date of Termination, or
(ii)&nbsp;in the case of a resignation by Employee, shall specify in reasonable detail the basis for
such resignation and the Date of Termination. A Notice of Termination given by Employee pursuant
to Section&nbsp;7(a)(iv) 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. A Notice of
Termination given by Employee pursuant to Section&nbsp;7(a)(iv) shall be considered effective only after
30&nbsp;days have elapsed since Employee delivered the applicable Good Reason Notice and the Company has
failed to resolve the issue causing the change in terms or status during such 30&nbsp;day period. Any
purported termination for which a Notice of Termination is required that does not materially comply
with this Section 7(b) shall not be effective.


<P align="left" style="font-size: 12pt; text-indent: 8%">(c)&nbsp;<U>Date of Termination, Etc.</U> The &#147;<U>Date of Termination</U>&#148; shall mean the date
specified in the Notice of Termination, provided that the Date of Termination shall be at least 15
calendar days, but not more than 45 calendar days, following the date the Notice of Termination is
given. Notwithstanding anything herein to the contrary, in the case of a termination of this
Agreement pursuant to Section&nbsp;7(a)(v), the Date of Termination shall be the date that the Change of
Control occurs. In the event Employee is terminated for Misconduct, the Company may refuse to
allow Employee access to the Company&#146;s offices (other than to allow Employee to collect his
personal belongings under the Company&#146;s supervision) prior to the Date of Termination. Employee
shall not be expected to provide further services after the Date of Termination.


<P align="left" style="font-size: 12pt; text-indent: 8%">(d)&nbsp;<U>Mitigation</U>. Employee shall not be required to mitigate the amount of any payment
provided for in this Section&nbsp;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&#146;s severance plan or policy for employees in general shall reduce the amount
otherwise payable pursuant to Section&nbsp;7(a)(iii)(B).


<P align="left" style="font-size: 12pt; text-indent: 8%">(e)&nbsp;<U>Excess Parachute Payments</U>.



<P align="left" style="margin-left:4%; font-size: 12pt; text-indent: 8%">(i)&nbsp;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&#146;s employment would, as determined by tax counsel selected by the
Company, constitute an &#147;<U>Excess Parachute Payment</U>&#148; (as defined in Section&nbsp;280G of the
Internal Revenue Code (the &#147;<U>Code</U>&#148;)) subject to the excise tax imposed by Section
4999 of the Code (together with any interest or penalties imposed with respect to such
taxes), the Company shall fully &#147;gross-up&#148; such payment and benefit by paying to Employee
additional amounts (&#147;gross-up payments&#148;), which shall include any excise taxes and income
taxes imposed upon such gross-up payments, so that Employee is in the same &#147;net&#148; after-tax
position he would have been if such payment, benefit and gross-up payments had not
constituted Excess Parachute Payments.



<P align="left" style="margin-left:4%; font-size: 12pt; text-indent: 8%">(ii)&nbsp;As a result of the uncertainty in the application of Section&nbsp;4999 of the Code, it
is possible that any gross-up payments calculated at the time of the initial determination
described above and made by the Company will be less than the gross-up payments that should
have been made. If Employee determines from time to time in his sole discretion that he is
or will be required to make a payment of any excise taxes under Section&nbsp;4999 of the Code
(together with any interest or penalties with respect to such taxes) in addition to that
initially determined as described above and that he is therefore entitled to additional
gross-up payments, he shall inform the Company of the amount of the additional gross-up
payments and any such additional gross-up payments shall be paid promptly by the Company to
or for the benefit of Employee.



<P align="left" style="margin-left:4%; font-size: 12pt; text-indent: 8%">(iii)&nbsp;No payment of a gross up shall occur until the first business day occurring after
the date that is six months after the Date of Termination. Payment of the gross up will be
made no later than the end of Employee&#146;s taxable year next following Employee&#146;s taxable year
in which Employee remits the related taxes.


<P align="left" style="font-size: 12pt; text-indent: 4%">8.&nbsp;<U>Nondisclosure and Noncompetition</U>. 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&nbsp;A, as well as
any subsequent addenda thereto.


<P align="left" style="font-size: 12pt; text-indent: 8%">(a)&nbsp;<U>Consideration For Non-Compete</U>. In consideration for the agreement set forth in
this Section&nbsp;8, upon termination or as otherwise provided in this Agreement, Employee shall
receive:



<P align="left" style="margin-left:4%; font-size: 12pt; text-indent: 8%">(i)&nbsp;the sum of fifteen million ($15,000,000.00) dollars plus interest accrued thereon
from the date of deposit which has been set aside in a trust suitable to Employee which
trust shall invest the funds in an interest bearing account for the purpose of securing
payment hereunder; it being understood that such amounts shall remain subject to claims of
the general creditors of the Company; and



<P align="left" style="margin-left:4%; font-size: 12pt; text-indent: 8%">(ii)&nbsp;for ten years, commencing on the first day following the six month anniversary of
the Date of Termination, the Company shall provide Employee for his private use in his sole
discretion, the use of a mid-size jet aircraft (which shall mean a jet aircraft comparable
to but not less than the jet aircraft most commonly used by Employee in the year prior to
the Date of Termination) for 150 hours annually, the cost (as based on the Company&#146;s
&#147;incremental cost&#148; of operating the current aircraft primarily utilized by Employee as of
January&nbsp;23, 2007) of which shall not exceed $300,000 annually.


<P align="left" style="font-size: 12pt; text-indent: 4%">9.&nbsp;<U>Non-exclusivity of Rights</U>. Nothing in this Agreement shall prevent or limit
Employee&#146;s continuing or future participation in any benefit, bonus, incentive or other plan or
program provided by the Company 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
granted by the Company.


<P align="left" style="font-size: 12pt; text-indent: 4%">10.&nbsp;<U>Assignability</U>. 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 of the Company, so long as the
obligations of the Company under this Agreement remain the obligations of the Company.


<P align="left" style="font-size: 12pt; text-indent: 4%">11.&nbsp;<U>Notice</U>. 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 Federal Express or similar courier, addressed (a)&nbsp;to the Company, at its principal office
address, directed to the attention of the Board with a copy to the Corporate Secretary of the
Company, and (b)&nbsp;to Employee, at Employee&#146;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.


<P align="left" style="font-size: 12pt; text-indent: 4%">12.&nbsp;<U>Validity</U>. The invalidity or unenforceability 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.


<P align="left" style="font-size: 12pt; text-indent: 4%">13.&nbsp;<U>Successors; Binding Agreement</U>.


<P align="left" style="font-size: 12pt; text-indent: 8%">(a)&nbsp;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 constitute Good Reason under Section&nbsp;7(a)(iv); <U>provided</U>, 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 &#147;Company&#148; shall include any successor to its
business and/or assets as aforesaid that executes and delivers the Agreement provided for in this
Section&nbsp;13 or that otherwise becomes bound by all terms and provisions of this Agreement by
operation of law.


<P align="left" style="font-size: 12pt; text-indent: 8%">(b)&nbsp;This Agreement and all rights of Employee hereunder shall inure to the benefit of and be
enforceable by Employee&#146;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&#146;s devisee,
legatee, or other designee or, if there be no such designee, to Employee&#146;s estate.


<P align="left" style="font-size: 12pt; text-indent: 4%">14.&nbsp;<U>Indemnification: Liability Insurance</U>.


<P align="left" style="font-size: 12pt; text-indent: 8%">(a)&nbsp;The Company shall indemnify and hold Employee (or his legal representative) harmless to
the full extent permitted by applicable law for all legal expenses and all liabilities, losses,
judgments, fines, expenses, and amounts paid in settlement in connection with any proceeding
involving him (including any action by or in the right of the Company) by reason of his being or
having been a director, officer, employee, consultant, or agent of the Company or any of its
subsidiaries, affiliates, or any other enterprise if he is serving or has served at the request of
the Company. In addition, the Company shall cause any such subsidiary, affiliate, or enterprise
also to so indemnify and hold Employee harmless to the full extent permitted by applicable law.
The foregoing shall not be deemed to limit any rights of Employee pursuant to applicable
indemnification provisions of the Company&#146;s Articles of Incorporation or By-Laws or otherwise, and
the Company agrees to amend such Articles of Incorporation and Bylaws to provide Employee
indemnification consistent herewith. The Company also agrees to amend its Articles of
Incorporation to provide immunity to Employee to the full extent allowed by law. In addition, the
Company shall acquire and maintain with reputable insurance companies or associations acceptable to
Employee, directors&#146; and officers&#146; liability insurance for the benefit of the directors and
officers of the Company, including Employee, providing terms and coverage amounts of at least
$75,000,000,. Such insurance shall remain in place, to the extent that the Company is able to
purchase the same, as long as necessary under applicable statutes of limitations to cover all
events occurring during the term of this Agreement regardless of when the claim is made.


<P align="left" style="font-size: 12pt; text-indent: 8%">(b)&nbsp;In the event of any action, proceeding, or claim against Employee arising out of his
serving or having served in a capacity specified above, the Company shall provide Employee with
counsel, who may be counsel for the Company as well, as long as no conflict of interest exists
between the Company and Employee and no ethical or professional responsibility rules prevent the
same counsel from representing both Employee and the Company. In the event of any such conflict of
interest or other bar to Employee being represented by counsel for the Company, Employee may retain
his own separate counsel (such choice of counsel may be made in his sole and absolute discretion),
and the Company shall be obligated to advance to Employee (or pay directly to his counsel)
reasonable counsel fees and other costs associated with Employee&#146;s defense of such action,
proceeding, or claim; provided, however, that in such event, Employee shall first agree in writing,
without posting bond or collateral, to repay all sums paid or advanced to him pursuant to this
provision in the event the final disposition of such action, proceeding, or claim is one for which
Employee would not be entitled to indemnification.


<P align="left" style="font-size: 12pt; text-indent: 4%">15.&nbsp;<U>Miscellaneous</U>.


<P align="left" style="font-size: 12pt; text-indent: 8%">(a)&nbsp;<U>Amendment and Waiver</U>. 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 of the Company 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.


<P align="left" style="font-size: 12pt; text-indent: 8%">(b)&nbsp;<U>Entire Agreement</U>. The Company and Employee have heretofore entered into the
Original Agreement. The Original Agreement shall continue in full force and effect until the
Effective Date, after which it will be superseded by this Agreement; <U>provided</U> that nothing
in this Agreement shall be deemed to discharge or otherwise prejudice Employee&#146;s right to receive,
or the Company&#146;s obligation to pay or provide, any of the benefits accrued under the Original
Agreement as of the Effective Date. Subject to the foregoing, this Agreement is an integration of
the Parties&#146; 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 that are set
forth expressly in this Agreement.


<P align="left" style="font-size: 12pt; text-indent: 8%">(c)&nbsp;<U>Governing Law</U>. THE VALIDITY, INTERPRETATION, CONSTRUCTION AND PERFORMANCE OF THIS
AGREEMENT SHALL BE GOVERNED BY THE LAWS OF THE STATE OF LOUISIANA, except for Section&nbsp;8, in which
case the law of the jurisdiction in which the non-compete is sought to be enforced by the Company
shall govern in the event such applicable law is more favorable to the Company.


<P align="left" style="font-size: 12pt; text-indent: 8%">(d)&nbsp;Notwithstanding anything herein to the contrary, this Agreement is intended to comply with
Internal Revenue Code Section&nbsp;409A and the regulations and other guidance of general applicability
thereunder and shall at all times be interpreted in accordance with such intent such that amounts
credited under this Agreement shall not be taxable until such amounts are distributed in accordance
with the terms of this Agreement. In the event that Employee is a &#147;specified employee&#148; at the Date
of Termination, any amounts that are considered nonqualified deferred compensation for purposes of
Internal Revenue Code Section&nbsp;409A and that are distributable because of a separation from service
shall be delayed until the first business day occurring after the date that is six months after the
Date of Termination. Any provision of this Agreement to the contrary is without effect.


<P align="left" style="font-size: 12pt; text-indent: 8%">(f)&nbsp;Reimbursements provided for under this Agreement shall be provided in accordance with
policies of the Company established from time to time.


<P align="left" style="font-size: 12pt; text-indent: 4%">16.&nbsp;<U>Counterparts</U>. 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.


<P align="left" style="font-size: 12pt; text-indent: 4%">17.&nbsp;<U>Arbitration</U>. 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.


<P align="left" style="font-size: 12pt; text-indent: 4%">18.&nbsp;<U>Expenses</U>. In order that the purpose of this Agreement not be frustrated, it is
the intent of the Company that the Employee not be required to incur the expenses associated with
enforcement of the Employee&#146;s rights under this Agreement by litigation or other legal action
because the cost and expense thereof would substantially detract from the benefits intended to be
extended to the Employee hereunder, nor be bound to negotiate any settlement of the Employee&#146;s
rights hereunder under threat of incurring such expenses. Accordingly, if following the Effective
Date it should appear to the Employee that the Company has failed to comply with any of its
obligations under this Agreement or, if at any time, in the event that the Company or any other
person takes any action to declare this Agreement void or unenforceable, or institutes any
litigation or other legal action designed to deny, diminish or to recover from the Employee the
benefits intended to be provided to the Employee hereunder, and that the Employee has complied with
all of the Employee&#146;s obligations under this Agreement, the Company irrevocably authorizes the
Employee from time to time to retain counsel of the Employee&#146;s choice at the expense of the Company
to represent the Employee in connection with the initiation or defense of any litigation or other
legal action, whether by or against the Company or any director, officer, stockholder or other
person affiliated with the Company, in any jurisdiction. Notwithstanding any existing or prior
attorney-client relationship between the Company and such counsel (other than a counsel acting on
behalf of the Company in connection with this Agreement), the Company irrevocably consents to the
Employee&#146;s entering into an attorney-client relationship with such counsel, and in that connection
the Company and the Employee agree that a confidential relationship shall exist between the
Employee and such counsel. The Company agrees to pay as incurred, to the full extent permitted by
law, all costs and expenses which the Employee may reasonably incur as a result of any contest
(regardless of the outcome thereof) by the Company, the Employee or others of the validity or
enforceability of, or liability under, any provision of this Agreement or any guarantee of
performance thereof (including, without limitation, as a result of any contest by the Employee
about the amount of any payment pursuant to this Agreement), plus in each case interest on any
delayed payment at the applicable Federal rate. Included within such costs and expenses shall be
the reasonable fees and expenses of counsel selected from time to time by the Employee as
hereinabove provided, which fees and expenses shall be paid or reimbursed to the Employee by the
Company on a regular, periodic basis upon presentation by the Employee of a statement or statements
prepared by such counsel in accordance with its customary practices.


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<P align="left" style="font-size: 12pt; text-indent: 4%"><B>IN WITNESS WHEREOF</B>, the Parties have executed this Agreement on December&nbsp;31, 2008, effective
for all purposes as of the Effective Date.



<P align="left" style="margin-left:23%; font-size: 12pt">THE SHAW GROUP INC.



<P align="left" style="margin-left:23%; font-size: 12pt">By <U>/s/ Clifton S. Rankin</U><BR>
Clifton S. Rankin, General Counsel &#038; Corporate<BR>
Secretary<BR>


<P align="left" style="font-size: 12pt">EMPLOYEE:


<P align="left" style="font-size: 12pt"><U>J.M. Bernhard, Jr.</U>
<BR>
J.M. Bernhard, Jr.



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