10-Q

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

x QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended September 30, 2013

or

¨ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from                      to                     

Commission File Number 001-31305

FOSTER WHEELER AG

(Exact name of registrant as specified in its charter)

Switzerland	98-0607469
(State or other jurisdiction of incorporation or organization)	(I.R.S. Employer Identification No.)
Shinfield Park Reading Berkshire RG2 9FW, United Kingdom	RG2 9FW
(Address of principal executive offices)	(Zip Code)

44 118 913 1234

(Registrant’s telephone number, including area code)

Indicate by check mark whether the registrant: (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the Registrant was required to file such reports) and (2) has been subject to such filing requirements for the past 90 days.    Yes  x    No  ¨

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files).    Yes  x    No  ¨

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See the definitions of “large accelerated filer,” “accelerated filer” and “smaller reporting company” in Rule 12b-2 of the Exchange Act. (Check one):

Large accelerated filer	x	Accelerated filer	¨
Non-accelerated filer	¨  (Do not check if a smaller reporting company)	Smaller reporting company	¨

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).    Yes  ¨    No  x

Indicate the number of shares outstanding of each of the issuer’s classes of common stock, as of the latest practicable date: 98,393,359 registered shares were outstanding as of October 25, 2013.

FOSTER WHEELER AG

INDEX

Part I FINANCIAL INFORMATION			3
Item 1	–	Financial Statements (Unaudited):	3
		Consolidated Statement of Operations for the Quarters and Nine Months Ended September 30, 2013 and 2012	3
		Consolidated Statement of Comprehensive Income for the Quarters and Nine Months Ended September 30, 2013 and 2012	4
		Consolidated Balance Sheet as of September 30, 2013 and December 31, 2012	5
		Consolidated Statement of Changes in Equity for the Nine Months Ended September 30, 2013 and 2012	6
		Consolidated Statement of Cash Flows for the Nine Months Ended September 30, 2013 and 2012	7
		Notes to Consolidated Financial Statements	8
Item 2	–	Management’s Discussion and Analysis of Financial Condition and Results of Operations	34
Item 3	–	Quantitative and Qualitative Disclosures about Market Risk	57
Item 4	–	Controls and Procedures	57
Part II OTHER INFORMATION			57
Item 1	–	Legal Proceedings	57
Item 1A	–	Risk Factors	57
Item 2	–	Unregistered Sales of Equity Securities and Use of Proceeds	58
Item 3	–	Defaults Upon Senior Securities	58
Item 4	–	Mine Safety Disclosures	58
Item 5	–	Other Information	58
Item 6	–	Exhibits	59
Signatures			60

PART I. FINANCIAL INFORMATION

ITEM 1. FINANCIAL STATEMENTS

FOSTER WHEELER AG AND SUBSIDIARIES

CONSOLIDATED STATEMENT OF OPERATIONS

(in thousands of dollars, except per share amounts)

(unaudited)

	Quarter Ended September 30,						Nine Months Ended September 30,
	2013			2012			2013			2012
Operating revenues	$	801,826		$	797,296		$	2,455,377		$	2,661,348
Cost of operating revenues		648,360			643,076			2,028,858			2,228,112
Contract profit		153,466			154,220			426,519			433,236
Selling, general and administrative expenses		85,521			77,495			265,654			245,925
Other income, net		(9,873	)		(14,342	)		(32,638	)		(32,995	)
Other deductions, net		7,557			8,825			23,359			25,062
Interest income		(1,307	)		(2,469	)		(4,251	)		(8,583	)
Interest expense		3,388			3,197			9,976			10,862
Net asbestos-related provision/(gain)		2,000			2,000			(9,750	)		7,710
Income from continuing operations before income taxes		66,180			79,514			174,169			185,255
Provision for income taxes		17,794			16,790			36,273			43,965
Income from continuing operations		48,386			62,724			137,896			141,290
Discontinued operations:
Income/(loss) from discontinued operations before income taxes		1,760			(445	)		265			(851	)
Provision for income taxes from discontinued operations		—			—			—			—
Income/(loss) from discontinued operations		1,760			(445	)		265			(851	)
Net income		50,146			62,279			138,161			140,439
Less: Net (loss)/income attributable to noncontrolling interests		(467	)		4,057			3,823			10,712
Net income attributable to Foster Wheeler AG	$	50,613		$	58,222		$	134,338		$	129,727
Amounts attributable to Foster Wheeler AG:
Income from continuing operations	$	48,853		$	58,667		$	134,073		$	130,578
Income/(loss) from discontinued operations		1,760			(445	)		265			(851	)
Net income attributable to Foster Wheeler AG	$	50,613		$	58,222		$	134,338		$	129,727
Basic earnings per share attributable to Foster Wheeler AG:
Income from continuing operations (see Note 1)	$	0.50		$	0.55		$	1.33		$	1.22
Income/(loss) from discontinued operations		0.02			(0.01	)		—			(0.01	)
Net income attributable to Foster Wheeler AG	$	0.52		$	0.54		$	1.33		$	1.21
Diluted earnings per share attributable to Foster Wheeler AG:
Income from continuing operations (see Note 1)	$	0.50		$	0.55		$	1.32		$	1.21
Income/(loss) from discontinued operations		0.01			(0.01	)		—			(0.01	)
Net income attributable to Foster Wheeler AG	$	0.51		$	0.54		$	1.32		$	1.20

See notes to consolidated financial statements.

3

FOSTER WHEELER AG AND SUBSIDIARIES

CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME

(in thousands of dollars)

(unaudited)

	Quarter Ended September 30,						Nine Months Ended September 30,
	2013			2012			2013			2012
Net income	$	50,146		$	62,279		$	138,161		$	140,439
Other comprehensive income, net of tax:
Foreign currency translation adjustments:
Foreign currency translation adjustments, net of tax		12,126			15,307			(7,588	)		5,987
Cash flow hedges adjustments:
Unrealized loss		(1,456	)		(3,088	)		(148	)		(6,079	)
Tax impact		495			1,099			(1	)		2,292
Unrealized loss, net of tax		(961	)		(1,989	)		(149	)		(3,787	)
Reclassification for losses included in net income (see Note 8 for further information)		1,123			1,053			3,407			2,789
Tax impact		(382	)		(374	)		(1,051	)		(1,072	)
Reclassification for losses included in net income, net of tax		741			679			2,356			1,717
Total cash flow hedges adjustments, net of tax		(220	)		(1,310	)		2,207			(2,070	)
Pension and other postretirement benefits adjustments, net of tax:
Amortization included in net periodic pension cost (see Note 6 for further information):
Net actuarial loss		4,768			4,358			14,365			13,056
Tax impact		(298	)		(338	)		(1,303	)		(1,129	)
Net actuarial loss, net of tax		4,470			4,020			13,062			11,927
Prior service credit		(1,257	)		(1,274	)		(3,781	)		(3,820	)
Tax impact		50			100			232			300
Prior service credit, net of tax		(1,207	)		(1,174	)		(3,549	)		(3,520	)
Transition obligation		14			13			42			38
Tax impact		(15	)		3			(9	)		10
Transition obligation, net of tax		(1	)		16			33			48
Total pension and other postretirement benefits adjustments, net of tax		3,262			2,862			9,546			8,455
Other comprehensive income, net of tax		15,168			16,859			4,165			12,372
Comprehensive income		65,314			79,138			142,326			152,811
Less: Comprehensive income attributable to noncontrolling interests		11			4,597			3,151			11,020
Comprehensive income attributable to Foster Wheeler AG	$	65,303		$	74,541		$	139,175		$	141,791

See notes to consolidated financial statements.

4

FOSTER WHEELER AG AND SUBSIDIARIES

CONSOLIDATED BALANCE SHEET

(in thousands of dollars, except share data and per share amounts)

(unaudited)

	September 30, 2013			December 31, 2012
ASSETS
Current Assets:
Cash and cash equivalents	$	497,129		$	582,322
Accounts and notes receivable, net:
Trade		619,717			609,213
Other		90,385			86,981
Contracts in process		207,809			228,979
Prepaid, deferred and refundable income taxes		62,521			57,404
Other current assets		41,705			47,138
Current assets of discontinued operations		—			1,505
Total current assets		1,519,266			1,613,542
Land, buildings and equipment, net		280,245			285,402
Restricted cash		54,602			62,189
Notes and accounts receivable - long-term		14,111			14,119
Investments in and advances to unconsolidated affiliates		192,253			205,476
Goodwill		168,720			133,518
Other intangible assets, net		118,233			105,100
Asbestos-related insurance recovery receivable		114,188			132,438
Long-term assets of discontinued operations		—			49,579
Other assets		143,169			90,509
Deferred tax assets		44,147			42,052
TOTAL ASSETS	$	2,648,934		$	2,733,924
LIABILITIES, TEMPORARY EQUITY AND EQUITY
Current Liabilities:
Current installments on long-term debt	$	13,783		$	13,672
Accounts payable		277,627			298,411
Accrued expenses		254,144			231,602
Billings in excess of costs and estimated earnings on uncompleted contracts		527,642			564,356
Income taxes payable		39,771			64,992
Liabilities of discontinued operations		—			3,154
Total current liabilities		1,112,967			1,176,187
Long-term debt		117,113			124,034
Deferred tax liabilities		45,341			40,889
Pension, postretirement and other employee benefits		169,196			177,345
Asbestos-related liability		237,632			259,350
Other long-term liabilities		202,793			190,132
Commitments and contingencies
TOTAL LIABILITIES		1,885,042			1,967,937
Temporary Equity:
Non-vested share-based compensation awards subject to redemption		12,313			8,594
TOTAL TEMPORARY EQUITY		12,313			8,594
Equity:
Registered shares:
CHF 3.00 par value; authorized: 157,157,448 shares and 171,018,974 shares, respectively; conditionally authorized: 58,874,658 shares and 59,369,723 shares, respectively; issued: 104,936,654 shares and 108,701,018 shares, respectively; outstanding: 98,344,954 shares and 104,441,589 shares, respectively.		257,614			269,633
Paid-in capital		202,556			266,943
Retained earnings		970,331			835,993
Accumulated other comprehensive loss		(562,766	)		(567,603	)
Treasury shares (outstanding: 6,591,700 shares and 4,259,429 shares, respectively)		(150,131	)		(90,976	)
TOTAL FOSTER WHEELER AG SHAREHOLDERS’ EQUITY		717,604			713,990
Noncontrolling interests		33,975			43,403
TOTAL EQUITY		751,579			757,393
TOTAL LIABILITIES, TEMPORARY EQUITY AND EQUITY	$	2,648,934		$	2,733,924

See notes to consolidated financial statements.

5

FOSTER WHEELER AG AND SUBSIDIARIES

CONSOLIDATED STATEMENT OF CHANGES IN EQUITY

(in thousands of dollars)

(unaudited)

	Registered Shares			Paid-in Capital			Retained Earnings		Accumulated Other Comprehensive Loss			Treasury Shares			Total Foster Wheeler AG Shareholders’ Equity			Noncontrolling Interests			Total Equity
Nine Months Ended September 30, 2012:
Balance at December 31, 2011	$	321,181		$	606,053		$	699,971	$	(530,068	)	$	(409,390	)	$	687,747		$	47,925		$	735,672
Net income		—			—			129,727		—			—			129,727			10,712			140,439
Other comprehensive income, net of tax		—			—			—		12,064			—			12,064			308			12,372
Issuance of registered shares upon exercise of stock options		147			588			—		—			—			735			—			735
Issuance of registered shares upon vesting of restricted awards		679			(679	)		—		—			—			—			—			—
Distributions to noncontrolling interests		—			—			—		—			—			—			(12,505	)		(12,505	)
Share-based compensation expense		—			11,712			—		—			—			11,712			—			11,712
Excess tax shortfall related to share-based compensation		—			(61	)		—		—			—			(61	)		—			(61	)
Repurchase of registered shares		—			—			—		—			(50,921	)		(50,921	)		—			(50,921	)
Retirement of registered shares		(52,885	)		(356,505	)		—		—			409,390			—			—			—
Balance at September 30, 2012	$	269,122		$	261,108		$	829,698	$	(518,004	)	$	(50,921	)	$	791,003		$	46,440		$	837,443
Nine Months Ended September 30, 2013:
Balance at December 31, 2012	$	269,633		$	266,943		$	835,993	$	(567,603	)	$	(90,976	)	$	713,990		$	43,403		$	757,393
Net income		—			—			134,338		—			—			134,338			3,823			138,161
Other comprehensive (loss)/income, net of tax		—			—			—		4,837			—			4,837			(672	)		4,165
Issuance of registered shares upon exercise of stock options		637			3,656			—		—			—			4,293			—			4,293
Issuance of registered shares upon vesting of restricted awards		952			(952	)		—		—			—			—			—			—
Distributions to noncontrolling interests		—			—			—		—			—			—			(12,579	)		(12,579	)
Share-based compensation expense		—			10,400			—		—			—			10,400			—			10,400
Excess tax shortfall related to share-based compensation		—			(123	)		—		—			—			(123	)		—			(123	)
Repurchase of registered shares		—			—			—		—			(150,131	)		(150,131	)		—			(150,131	)
Retirement of registered shares		(13,608	)		(77,368	)		—		—			90,976			—			—			—
Balance at September 30, 2013	$	257,614		$	202,556		$	970,331	$	(562,766	)	$	(150,131	)	$	717,604		$	33,975		$	751,579

See notes to consolidated financial statements.

6

FOSTER WHEELER AG AND SUBSIDIARIES

CONSOLIDATED STATEMENT OF CASH FLOWS

(in thousands of dollars)

(unaudited)

	Nine Months Ended September 30,
	2013			2012
CASH FLOWS FROM OPERATING ACTIVITIES
Net income	$	138,161		$	140,439
Adjustments to reconcile net income to cash flows from operating activities:
Depreciation and amortization		42,828			35,541
Net non-cash asbestos-related provision		6,000			7,710
Share-based compensation expense		14,119			16,362
Shortfall in tax benefit related to share-based compensation		123			61
Deferred income tax provision		62			413
Dividends, net of equity in earnings of unconsolidated affiliates		28,744			3,859
Other noncash items, net		86			868
Changes in assets and liabilities, net of effects from acquisitions:
Decrease/(increase) in receivables		4,833			(103,491	)
Net change in contracts in process and billings in excess of costs and estimated earnings on uncompleted contracts		(17,463	)		(65,713	)
(Decrease)/increase in accounts payable and accrued expenses		(45,316	)		73,582
Net change in other current assets and liabilities		(31,296	)		9,764
Net change in other long-term assets and liabilities		(26,799	)		(9,721	)
Net cash provided by operating activities — continuing operations		114,082			109,674
Net cash (used in)/provided by operating activities — discontinued operations		(385	)		931
Net cash provided by operating activities		113,697			110,605
CASH FLOWS FROM INVESTING ACTIVITIES
Payments related to acquisition of businesses, net of cash acquired		(52,770	)		—
Proceeds from disposition of business		48,600			—
Change in restricted cash		9,249			(34,264	)
Capital expenditures		(21,810	)		(26,397	)
Return of investment from unconsolidated affiliates		87			6,207
Investments in and advances to unconsolidated affiliates		(11,591	)		(1,987	)
Proceeds from sale of short-term investments		—			1,255
Other investing activities		(47	)		299
Net cash used in investing activities — continuing operations		(28,282	)		(54,887	)
Net cash provided by/(used in) investing activities — discontinued operations		385			(931	)
Net cash used in investing activities		(27,897	)		(55,818	)
CASH FLOWS FROM FINANCING ACTIVITIES
Repurchase of shares		(150,131	)		(50,921	)
Distributions to noncontrolling interests		(12,579	)		(12,505	)
Proceeds from stock options exercised		4,293			735
Shortfall in tax benefit related to share-based compensation		(123	)		(61	)
Payment of deferred financing costs		—			(3,993	)
Repayment of debt and capital lease obligations		(8,627	)		(7,065	)
Net cash used in financing activities		(167,167	)		(73,810	)
Effect of exchange rate changes on cash and cash equivalents		(3,826	)		10,344
Decrease in cash and cash equivalents		(85,193	)		(8,679	)
Less: Increase/(decrease) in cash and cash equivalents — discontinued operations		—			—
Decrease in cash and cash equivalents — continuing operations		(85,193	)		(8,679	)
Cash and cash equivalents at beginning of year		582,322			718,049
CASH AND CASH EQUIVALENTS AT END OF PERIOD	$	497,129		$	709,370

See notes to consolidated financial statements.

7

FOSTER WHEELER AG AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(amounts in thousands of dollars, except share data and per share amounts)

(unaudited)

1. Summary of Significant Accounting Policies

Basis of Presentation — The fiscal year of Foster Wheeler AG ends on December 31 of each calendar year. Foster Wheeler AG’s fiscal quarters end on the last day of March, June and September. The fiscal years of our non-U.S. operations are the same as the parent’s. The fiscal year of our U.S. operations is the 52- or 53-week annual accounting period ending on the last Friday in December.

The accompanying consolidated financial statements are unaudited. In the opinion of management, all adjustments necessary for a fair presentation of such financial statements have been included. Such adjustments only consisted of normal recurring items. Interim results are not necessarily indicative of results for a full year.

The consolidated financial statements and notes are presented in accordance with the requirements of Form 10-Q and do not contain certain information included in our Annual Report on Form 10-K for the year ended December 31, 2012 (“2012 Form 10-K”), filed with the Securities and Exchange Commission on March 1, 2013. The consolidated balance sheet as of December 31, 2012 was derived from the audited financial statements included in our 2012 Form 10-K, but does not include all disclosures required by accounting principles generally accepted in the United States of America for annual consolidated financial statements.

Certain prior period amounts have been reclassified to conform to the current period presentation. These reclassifications include the presentation of our Statement of Comprehensive Income as a result of our adoption of “ASU No. 2013-02, Comprehensive Income (Topic 220): Reporting of Amounts Reclassified Out of Accumulated Other Comprehensive Income”, or ASU No. 2013-02. ASU No. 2013-02 was issued by the Financial Accounting Standards Board in February 2013. The standard requires disclosure of the effects on the line items of net income for significant amounts reclassified out of accumulated other comprehensive income and a cross-reference to other disclosures when a portion of the amount reclassified out of accumulated other comprehensive income is initially transferred to a balance sheet account (e.g., contracts in process or billings in excess of costs and estimated earnings on uncompleted contracts for pension-related amounts) instead of directly to income or expense. The adoption of this standard did not have an impact on our results of operations, financial position or cash flows.

Reclassifications from accumulated other comprehensive loss related to cash flow hedges amounted to losses of $741 and $2,356 during the quarter and nine months ended September 30, 2013, respectively, and $679 and $1,717 during the quarter and nine months ended September 30, 2012, respectively. These losses included amounts related to our consolidated entities and our proportionate share of the impact from interest rate swap contracts in cash flow hedging relationships held by our equity method investees. Amounts that are reclassified from accumulated other comprehensive loss related to cash flow hedges from our consolidated entities are recognized within interest expense on the consolidated statement of operations, whereas amounts related to our equity method investees are recognized within equity earnings in other income, net on the consolidated statement of operations. Please refer to Note 8 for further information.

Reclassifications from accumulated other comprehensive loss related to pension and other postretirement benefits are included as a component of net periodic pension cost. Please refer to Note 6 for further information.

The tax effect related to foreign currency translation adjustments was inconsequential during the quarters and nine months ended September 30, 2013 and 2012.

Reclassifications also include the presentation of our former waste-to-energy business as a result of its classification as held-for-sale and, in turn, discontinued operations. Please refer to Note 13 for further information.

The consolidated financial statements include the accounts of Foster Wheeler AG and all U.S. and non-U.S. subsidiaries, as well as certain entities in which we have a controlling interest. Intercompany transactions and balances have been eliminated. See “—Variable Interest Entities” below for further information related to the consolidation of variable interest entities.

Use of Estimates — The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities at the date of the financial statements and revenues and expenses during the periods reported. Actual results could differ from those estimates. Changes in estimates are reflected in the periods in which they become known. Significant estimates are used in accounting for long-term contracts including estimates of total costs, progress toward completion and customer and vendor claims, employee benefit plan

8

obligations and share-based compensation plans. In addition, we also use estimates when accounting for uncertain tax positions and deferred taxes, asbestos liabilities and expected recoveries and when assessing goodwill for impairment, among others.

Revenue Recognition on Long-Term Contracts — Revenues and profits on long-term contracts are recorded under the percentage-of-completion method.

Progress towards completion on fixed-price contracts is measured based on physical completion of individual tasks for all contracts with a value of $5,000 or greater. For contracts with a value less than $5,000, progress toward completion is measured based on the ratio of costs incurred to total estimated contract costs (the cost-to-cost method).

Progress towards completion on cost-reimbursable contracts is measured based on the ratio of quantities expended to total forecasted quantities, typically man-hours. Incentives are also recognized on a percentage-of-completion basis when the realization of an incentive is assessed as probable. We include flow-through costs consisting of materials, equipment or subcontractor services as both operating revenues and cost of operating revenues on cost-reimbursable contracts when we have overall responsibility as the contractor for the engineering specifications and procurement or procurement services for such costs. There is no contract profit impact of flow-through costs as they are included in both operating revenues and cost of operating revenues.

Contracts in process are stated at cost, increased for profits recorded on the completed effort or decreased for estimated losses, less billings to the customer and progress payments on uncompleted contracts. A full provision for loss contracts is made at the time the loss becomes probable regardless of the stage of completion.

At any time, we have numerous contracts in progress, all of which are at various stages of completion. Accounting for revenues and profits on long-term contracts requires estimates of total contract costs and estimates of progress toward completion to determine the extent of revenue and profit recognition. These estimates may be revised as additional information becomes available or as specific project circumstances change. We review all of our material contracts on a monthly basis and revise our estimates as appropriate for developments such as earning project incentive bonuses, incurring or expecting to incur contractual liquidated damages for performance or schedule issues, providing services and purchasing third-party materials and equipment at costs differing from those previously estimated and testing completed facilities, which, in turn, eliminates or confirms completion and warranty-related costs. Project incentives are recognized when it is probable they will be earned. Project incentives are frequently tied to cost, schedule and/or safety targets and, therefore, tend to be earned late in a project’s life cycle.

Changes in estimated final contract revenues and costs can either increase or decrease the final estimated contract profit. In the period in which a change in estimate is recognized, the cumulative impact of that change is recorded based on progress achieved through the period of change. The following table summarizes the number of separate projects that experienced final estimated contract profit revisions with an impact on contract profit in excess of $1,000 relating to the revaluation of work performed in prior periods:

	Quarter Ended September 30,				Nine Months Ended September 30,
	2013		2012		2013		2012
Number of separate projects		10		12		28		27
Net increase in contract profit from the regular revaluation of final estimated contract profit revisions	$	30,200	$	22,700	$	74,800	$	58,000

The changes in final estimated contract profit revisions for our Global Power Group were increased during the nine months ended September 30, 2012 for a favorable settlement with a subcontractor of approximately $6,900 recognized in the first quarter of 2012. The changes in final estimated contract profit revisions for our Global E&C Group and our financial results did not include an increase in final estimated contract profit of approximately $5,300 during the quarter and nine months ended September 30, 2012. The correction was recorded in the quarter ended December 31, 2012 as it was not material to the financial results for the quarter and nine months ended September 30, 2012 (the periods in which it should have been recorded), nor was it material to the financial results for the year ended December 31, 2012.

Please see Note 11 for further information related to changes in final estimated contract profit and the impact on business segment results.

Claims are amounts in excess of the agreed contract price (or amounts not included in the original contract price) that we seek to collect from customers or others for delays, errors in specifications and designs, contract terminations, disputed or unapproved change orders as to both scope and price or other causes of unanticipated additional costs. We record claims as additional contract revenue if it is probable that the claims will result in

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additional contract revenue and if the amount can be reliably estimated. These two requirements are satisfied by the existence of all of the following conditions: the contract or other evidence provides a legal basis for the claim; additional costs are caused by circumstances that were unforeseen at the contract date and are not the result of deficiencies in our performance; costs associated with the claim are identifiable or otherwise determinable and are reasonable in view of the work performed; and the evidence supporting the claim is objective and verifiable. If such requirements are met, revenue from a claim may be recorded only to the extent that contract costs relating to the claim have been incurred, which can include amounts from unapproved change orders when the two requirements described above are met. Unapproved change orders or similar items subject to uncertainty that do not meet the two requirements described above are expensed without the recognition of additional contract revenue. Costs attributable to claims are treated as costs of contract performance as incurred and are recorded in contracts in process. Our consolidated financial statements included commercial claims of $4,600 and $8,800 as of September 30, 2013 and December 31, 2012, respectively, of which substantially all costs had been incurred as of September 30, 2013 and December 31, 2012.

In certain circumstances, we may defer pre-contract costs when it is probable that these costs will be recovered under a future contract. Such deferred costs would then be included in contract costs upon execution of the anticipated contract. In the event that we defer pre-contract costs and we are not successful in obtaining the contract, we write off the deferred costs through our consolidated statement of operations in the period when we no longer assess recoverability of such costs as probable. Deferred pre-contract costs were inconsequential as of September 30, 2013 and December 31, 2012.

Certain special-purpose subsidiaries in our Global Power Group business segment are reimbursed by customers for their costs of building and operating certain facilities over the lives of the corresponding service contracts. Depending on the specific legal rights and obligations under these arrangements, in some cases those reimbursements are treated as operating revenues at gross value and other cases as a reduction of cost.

Trade Accounts Receivable — Trade accounts receivable represent amounts billed to customers. We assess the need for an allowance for doubtful accounts on a project-by-project basis, which includes the consideration of security instruments that provide us protection in the event of non-payment. When there is a risk of non-payment related to customer credit risk, we record an allowance for doubtful accounts. Because of the nature of our customer base and our rigorous customer credit risk assessment process prior to entering into contracts, the level of our allowance for doubtful accounts is typically a very small percentage of our gross accounts receivable balance. To the extent that there is a risk of non-payment related to commercial or performance issues, we record an allowance against the valuation of contract work in progress within the contract.

In accordance with terms under our long-term contracts, our customers may withhold certain percentages of such billings until completion and acceptance of the work performed, which we refer to as retention receivables. Final payment of retention receivables might not be received within a one-year period. In conformity with industry practice, however, the full amount of accounts receivable, including such amounts withheld, are included in current assets on the consolidated balance sheet. We have not recorded a provision for the outstanding retention receivable balances as of September 30, 2013 or December 31, 2012.

Variable Interest Entities — We sometimes form separate legal entities such as corporations, partnerships and limited liability companies in connection with the execution of a single contract or project. Upon formation of each separate legal entity, we perform an evaluation to determine whether the new entity is a variable interest entity, or VIE, and whether we are the primary beneficiary of the new entity, which would require us to consolidate the new entity in our financial results. We reassess our initial determination on whether the entity is a VIE upon the occurrence of certain events and whether we are the primary beneficiary as outlined in current accounting guidelines. If the entity is not a VIE, we determine the accounting for the entity under the voting interest accounting guidelines.

An entity is determined to be a VIE if either (a) the total equity investment is not sufficient for the entity to finance its own activities without additional subordinated financial support, (b) characteristics of a controlling financial interest are missing (such as the ability to make decisions through voting or other rights or the obligation to absorb losses or the right to receive benefits), or (c) the voting rights of the equity holders are not proportional to their obligations to absorb losses of the entity and/or their rights to receive benefits of the entity, and substantially all of the entity’s activities either involve or are conducted on behalf of an investor that has disproportionately few voting rights.

As of September 30, 2013 and December 31, 2012, we participated in certain entities determined to be VIEs, including a gas-fired cogeneration facility in Martinez, California and a refinery/electric power generation project in Chile. We consolidate the operations of the Martinez project while we record our participation in the project in Chile on the equity method of accounting.

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Please see Note 3 for further information regarding our participation in these projects.

Fair Value Measurements — Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. Financial Accounting Standards Board Accounting Standards Codification, or FASB ASC, 820-10 defines fair value, establishes a three level fair value hierarchy that prioritizes the inputs used to measure fair value and provides guidance on required disclosures about fair value measurements. The fair value hierarchy gives the highest priority to unadjusted quoted prices in active markets for identical assets or liabilities and the lowest priority to unobservable inputs.

Our financial assets and liabilities that are recorded at fair value on a recurring basis consist primarily of the assets or liabilities arising from derivative financial instruments and defined benefit pension plan assets. See Note 8 for further information regarding our derivative financial instruments.

The following methods and assumptions were used to estimate the fair value of each class of financial instruments for which it is practicable to estimate fair value:

Financial instruments valued independent of the fair value hierarchy:

• Cash, Cash Equivalents and Restricted Cash — The carrying value of our cash, cash equivalents and restricted cash approximates fair value because of the demand nature of many of our deposits or short-term maturity of these instruments.

Financial instruments valued within the fair value hierarchy:

• Long-term Debt — We estimate the fair value of our long-term debt (including current installments) based on the quoted market prices for the same or similar issues or on the current rates offered for debt of the same remaining maturities using level 2 inputs.

• Foreign Currency Forward Contracts — We estimate the fair value of foreign currency forward contracts by obtaining quotes from financial institutions or market transactions in either the listed or over-the-counter markets. Our estimate of the fair value of foreign currency forward contracts also includes an assessment of non-performance by our counterparties. We further corroborate the valuations with observable market data using level 2 inputs.

• Interest Rate Swaps — We estimate the fair value of our interest rate swaps based on quotes obtained from financial institutions, which we further corroborate with observable market data using level 2 inputs.

• Defined Benefit Pension Plan Assets — We estimate the fair value of investments in equity securities at each year-end based on quotes obtained from financial institutions. The fair value of investments in commingled funds, invested primarily in debt and equity securities, is based on the net asset values communicated by the respective asset manager. We further corroborate the above valuations with observable market data using level 1 and 2 inputs. Additionally, we hold investments in private investment funds that are valued at net asset value as communicated by the asset manager using level 3 unobservable market data inputs.

Retirement of Shares under Share Repurchase Program — Under Swiss law, the cancellation of shares previously repurchased under our share repurchase program must be approved by our shareholders. Repurchased shares remain as treasury shares on our balance sheet until cancellation.

Any repurchases will be made at our discretion in compliance with applicable securities laws and other legal requirements and will depend on a variety of factors, including market conditions, share price and other factors. The program does not obligate us to acquire any particular number of shares. The program has no expiration date and may be suspended or discontinued at any time.

All treasury shares are carried at cost on the consolidated balance sheet until the cancellation of the shares has been approved by our shareholders and the cancellation is registered with the commercial register of the Canton of Zug in Switzerland. Upon the effectiveness of the cancellation of the shares, the cost of the shares cancelled will be removed from treasury shares on the consolidated balance sheet, the par value of the cancelled shares will be removed from registered shares on the consolidated balance sheet, and the excess of the cost of the treasury shares above par value will be removed from paid-in capital on the consolidated balance sheet.

Once repurchased, treasury shares are no longer considered outstanding, which results in a reduction to the weighted-average number of shares outstanding during the reporting period when calculating earnings per share, as described below.

Earnings per Share — Basic earnings per share amounts have been computed based on the weighted-average number of shares outstanding during the reporting period.

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Diluted earnings per share amounts have been based on the combination of the weighted-average number of shares outstanding during the reporting period and the impact of dilutive securities, if any, such as outstanding stock options and the non-vested portion of restricted stock units and performance-based restricted stock units (collectively, “restricted awards”) to the extent such securities are dilutive.

In profitable periods, outstanding stock options have a dilutive effect under the treasury stock method when the average share price for the period exceeds the assumed proceeds from the exercise of the option. The assumed proceeds include the exercise price, compensation cost, if any, for future service that has not yet been recognized in the consolidated statement of operations, and any tax benefits that would be recorded in paid-in capital when the option is exercised. Under the treasury stock method, the assumed proceeds are assumed to be used to repurchase shares in the current period. The dilutive impact of the non-vested portion of restricted awards is determined using the treasury stock method, but the proceeds include only the unrecognized compensation cost and tax benefits as assumed proceeds.

The computations of basic and diluted earnings per share were as follows:

	Quarter Ended September 30,				Nine Months Ended September 30,
	2013		2012		2013		2012
Income from continuing operations attributable to Foster Wheeler AG	$	48,853	$	58,667	$	134,073	$	130,578
Basic weighted-average number of shares outstanding		98,172,200		107,065,999		100,830,719		107,558,489
Effect of dilutive securities		431,386		253,963		495,874		298,879
Diluted weighted-average number of shares outstanding		98,603,586		107,319,962		101,326,593		107,857,368
Income from continuing operations per share:
Basic	$	0.50	$	0.55	$	1.33	$	1.22
Diluted	$	0.50	$	0.55	$	1.32	$	1.21

The following table summarizes share-based compensation awards not included in the calculation of diluted earnings per share as the assumed proceeds from those awards, on a per share basis, were greater than the average share price for the period, which would result in an antidilutive effect on diluted earnings per share:

	Quarter Ended September 30,				Nine Months Ended September 30,
	2013		2012		2013		2012
Stock options		1,356,167		2,809,894		1,393,499		2,809,894
Performance-based restricted share units		1,144,694		—		1,144,694		—

2. Business Combinations

In June 2013, we acquired all of the outstanding shares of a privately held upstream consultancy business located in the United Kingdom and additional related assets in the Middle East. This acquired business specializes in field development and project decision support, focused on the evaluation and implementation of oil and gas field developments covering greenfield and brownfield assets. At closing, we paid cash consideration net of cash acquired of £6,300 (approximately $9,700 based on the exchange rate in effect on the closing date), subject to customary working capital adjustments, as specified in the sale and purchase agreement. The sale and purchase agreement also included an earnout provision for additional consideration with an estimated maximum of £3,000 (approximately $4,600 based on the exchange rate in effect on September 30, 2013), depending on the acquired business’ performance, as defined in the sale and purchase agreement, over a period of approximately 3 and a half years subsequent to the acquisition date. Any amounts recognized under the earnout will be reported as compensation expense in periods subsequent to the acquisition date rather than as part of the purchase price for the business. Our consolidated balance sheet as of September 30, 2013 included a preliminary purchase price allocation for this acquisition as we are in process of finalizing the valuation of the individual assets acquired and liabilities assumed. The preliminary purchase price allocation was based on the best estimate of management and we expect to finalize the purchase price allocation upon completion of an independent appraisal over the next several months, but no later than one year from the acquisition date. The preliminary purchase price allocation and pro forma impact assuming the acquisition had occurred as of the beginning of 2012 were not significant to our consolidated financial statements. As a result of the preliminary purchase price allocation, we recognized goodwill of $4,465 and other intangible assets of $5,307 related to this acquisition. The assets, liabilities and results of operations of the acquired business are included within our Global Engineering and Construction Group (“Global E&C Group”) business segment.

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Also in June 2013, we acquired all of the outstanding shares of a privately held engineering and project management business located in Mexico with experience in both offshore and onshore upstream oil and gas, downstream oil and gas and power projects. At closing, we paid cash consideration net of cash acquired of approximately $15,900, subject to customary working capital adjustments, as specified in the sale and purchase agreement. Our consolidated balance sheet as of September 30, 2013 included a preliminary purchase price allocation for this acquisition as we are in process of finalizing the valuation of the individual assets acquired and liabilities assumed. The preliminary purchase price allocation was based on the best estimate of management and we expect to finalize the purchase price allocation upon completion of an independent appraisal over the next several months, but no later than one year from the acquisition date. The preliminary purchase price allocation and pro forma impact assuming the acquisition had occurred as of the beginning of 2012 were not significant to our consolidated financial statements. As part of our post-acquisition valuation of assets and liabilities acquired during the quarter ended September 30, 2013, we recorded additional assets and liabilities of $20,782 and $32,647, respectively, and recorded a corresponding net increase to goodwill of $11,865. As a result of the preliminary purchase price allocation, we recognized goodwill of $18,143 and other intangible assets of $7,100 related to this acquisition. The assets, liabilities and results of operations of the acquired business are included within our Global E&C Group business segment.

During our U.S. operations’ fiscal first quarter of 2013, we acquired all of the outstanding shares of a privately held U.S.-based business that specializes in the management of construction and commissioning of pharmaceutical and biotech facilities and which also has the capabilities to manage the full engineering, procurement and construction of such facilities. In addition, the acquired business has the ability to provide modular project delivery services on a worldwide basis through its participation in a project-services partnership. At closing, we paid cash consideration net of cash acquired of approximately $25,100. The sale and purchase agreement also included an earnout provision for additional consideration with an estimated maximum of approximately $6,600, depending on the acquired business’ performance, as defined in the sale and purchase agreement, over a period of approximately 5 years subsequent to the acquisition date. Any amounts recognized under the earnout will be reported as compensation expense in periods subsequent to the acquisition date rather than as part of the purchase price for the business. The purchase price allocation and pro forma impact assuming the acquisition had occurred as of the beginning of 2012 were not significant to our consolidated financial statements. As a result of the purchase price allocation, we recognized goodwill of $10,571 and other intangible assets of $13,980 related to this acquisition. The assets, liabilities and results of operations of the acquired business are included within our Global E&C Group business segment.

In November 2012, we acquired all of the outstanding shares of a privately held multi-discipline full service engineering, procurement, and construction management business located in North America. At closing, we paid cash consideration net of cash acquired of approximately $70,800. The sale and purchase agreement also included an earnout provision for additional consideration with an estimated maximum of approximately $20,000, depending on the acquired business’ performance, as defined in the sale and purchase agreement, over a period of approximately 5 years subsequent to the acquisition date. The earnout will be reported as compensation expense in periods subsequent to the acquisition date rather than as part of the purchase price for the business. As a result of the purchase price allocation, we recognized goodwill of $18,708 and other intangible assets of $42,921 related to this acquisition. The assets, liabilities and results of operations of the acquired business are included within our Global E&C Group business segment.

3. Investments

Investment in Unconsolidated Affiliates

We own a noncontrolling interest in two electric power generation projects, one waste-to-energy project and one wind farm project, which are all located in Italy, and in a refinery/electric power generation project, which is located in Chile. We also own a 50% noncontrolling interest in a project in Italy which generates earnings from royalty payments linked to the price of natural gas. Based on the outstanding equity interests of these entities, we own 41.65% of each of the two electric power generation projects in Italy, 39% of the waste-to-energy project and 50% of the wind farm project. We have a notional 85% equity interest in the project in Chile; however, we are not the primary beneficiary as a result of participation rights held by the minority shareholder. In determining that we are not the primary beneficiary, we considered the minority shareholder’s right to approve activities of the project that most significantly impact the project’s economic performance which include the right to approve or reject the annual financial (capital and operating) budget and the annual operating plan, the right to approve or reject the appointment of the general manager and senior management, and approval rights with respect to capital expenditures beyond those included in the annual budget.

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We account for these investments in Italy and Chile under the equity method. The following is summarized financial information for these entities (each as a whole) based on where the projects are located:

	September 30, 2013				December 31, 2012
	Italy		Chile		Italy		Chile
Balance Sheet Data:
Current assets	$	141,817	$	55,220	$	142,584	$	137,626
Other assets (primarily buildings and equipment)		353,173		91,339		358,366		98,550
Current liabilities		97,545		20,254		91,085		60,082
Other liabilities (primarily long-term debt)		198,230		15,953		214,025		23,061
Net assets	$	199,215	$	110,352	$	195,840	$	153,033

	Quarter Ended September 30,								Nine Months Ended September 30,
	2013				2012				2013				2012
	Italy		Chile		Italy		Chile		Italy		Chile		Italy		Chile
Income Statement Data:
Total revenues	$	30,570	$	18,065	$	65,746	$	19,377	$	97,585	$	59,394	$	148,486	$	70,267
Gross profit		6,700		12,539		7,976		12,120		20,702		36,097		18,428		40,797
Income before income taxes		5,125		11,928		5,435		15,770		15,478		34,066		10,905		44,166
Net earnings		3,180		9,303		3,209		12,853		9,919		26,535		6,856		36,220

Our investment in these unconsolidated affiliates is recorded within investments in and advances to unconsolidated affiliates on the consolidated balance sheet and our equity in the net earnings of these unconsolidated affiliates is recorded within other income, net on the consolidated statement of operations. The investments and equity earnings of our unconsolidated affiliates in Italy and Chile are included in our Global E&C Group and Global Power Group business segments, respectively.

Our consolidated financial statements reflect the following amounts related to our unconsolidated affiliates in Italy and Chile:

	Quarter Ended September 30,				Nine Months Ended September 30,
	2013		2012		2013		2012
Equity in the net earnings of unconsolidated affiliates	$	6,944	$	6,856	$	27,382	$	22,675
Distributions from equity affiliates	$	—	$	—	$	55,933	$	31,917

	September 30, 2013		December 31, 2012
Investments in unconsolidated affiliates	$	161,127	$	187,363

Our equity earnings from our projects in Italy were $1,531 and $1,573 in the third quarter of 2013 and 2012, respectively, and were $4,915 and $4,001 in the first nine months of 2013 and 2012, respectively.

Our equity earnings from our project in Chile were $5,413 and $5,283 in the third quarter of 2013 and 2012, respectively, and were $22,467 and $18,674 in the first nine months of 2013 and 2012, respectively.

The increase in equity earnings in the nine months ended September 30, 2013, compared to the same period in 2012, was primarily driven by three items: a $3,200 increase in our share of the project’s 2012 earnings recognized as a result of a revised earnings allocation for 2012 that was approved in connection with the approval by the project’s governing board of the 2012 earnings distribution in the second quarter of 2013, and a $3,000 increase from the reversal of an insurance-related contingency during the second quarter of 2013, partially offset by the impact of lower marginal rates for electrical power generation in the nine months ended September 30, 2013.

We have guaranteed certain performance obligations of our project in Chile. We have a contingent obligation, which is measured annually based on the operating results of our project in Chile for the preceding year and is shared equally with our minority interest partner. We did not have a current payment obligation under this guarantee as of September 30, 2013 or December 31, 2012.

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In addition, we have provided a $10,000 debt service reserve letter of credit to cover debt service payments in the event that our project in Chile does not generate sufficient cash flows to make such payments. We are required to maintain the debt service reserve letter of credit during the term of our project in Chile’s debt, which matures in 2014. As of September 30, 2013, no amounts have been drawn under this letter of credit and we do not anticipate any amounts being drawn under this letter of credit.

We also have a wholly-owned subsidiary that provides operations and maintenance services to our project in Chile. We record the fees for operations and maintenance services in operating revenues on our consolidated statement of operations and the corresponding receivable in trade accounts and notes receivable on our consolidated balance sheet.

Our consolidated financial statements include the following balances related to our project in Chile:

	Quarter Ended September 30,				Nine Months Ended September 30,
	2013		2012		2013		2012
Fees for operations and maintenance services (included in operating revenues)	$	2,800	$	2,628	$	8,399	$	7,885

	September 30, 2013		December 31, 2012
Receivable from our unconsolidated affiliate in Chile (included in trade receivables)	$	4,184	$	16,933

We also have guaranteed the performance obligations of our wholly-owned subsidiary under the operations and maintenance agreement governing our project in Chile. The guarantee is limited to $20,000 over the life of the operations and maintenance agreement, which extends through 2016. No amounts have ever been paid under the guarantee.

During the quarter and nine months ended September 30, 2013, we acquired a 49% interest in a joint venture company that is fully licensed to engineer, procure and construct process facilities in China. We paid cash consideration of approximately 72,000 CYN (approximately $11,600 based on the exchange rate in effect on the closing date). This investment is included in investments in and advances to unconsolidated affiliates on our consolidated balance sheet.

Other Investments

We are the majority equity partner and general partner of a gas-fired cogeneration project in Martinez, California, which we have determined to be a VIE as of September 30, 2013 and December 31, 2012. We are the primary beneficiary of the VIE, since we have the power to direct the activities that most significantly impact the VIE’s performance. These activities include the operations and maintenance of the facilities. Accordingly, as the primary beneficiary of the VIE, we have consolidated this entity. The aggregate net assets of this entity are presented below.

Balance Sheet Data (excluding intercompany balances):	September 30, 2013		December 31, 2012
Current assets	$	5,425	$	15,610
Other assets (primarily buildings and equipment)		36,719		39,194
Current liabilities		2,565		4,825
Other liabilities		4,484		5,452
Net assets	$	35,095	$	44,527

4. Goodwill and Other Intangible Assets

We have tracked accumulated goodwill impairments since the beginning of fiscal year 2002, our date of adoption of the accounting guidelines related to the assessment of goodwill for impairment. There were no accumulated goodwill impairment losses as of that date. The following table provides our net carrying amount of goodwill by geographic region in which our reporting units are located:

	Global E&C Group				Global Power Group
Geographic Regions:	September 30, 2013		December 31, 2012		September 30, 2013		December 31, 2012
North America	$	85,017	$	55,962	$	4,266	$	4,266
Asia		752		858		—		—
Europe		6,627		2,568		71,490		69,864
Middle East		568		—		—		—
Total	$	92,964	$	59,388	$	75,756	$	74,130

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During the nine months ended September 30, 2013, our Global E&C Group’s goodwill balance included increases related to our acquisitions located in the U.S. and Mexico of $10,571 and $18,143, respectively, which were included in the North America geographic region in the table above, and the U.K. of $4,465, portions of which were included in both the Europe and Middle East geographic regions in the table above. Our Global E&C Group’s goodwill balance also includes a customary working capital adjustment of $2,026 for our 2012 acquisition, which is included in the North America geographic region in the table above. The remaining changes in each of the regions were the result of the impact of foreign currency translation adjustments. Please see Note 2 for further information regarding these acquisitions.

The following table sets forth amounts relating to our identifiable intangible assets:

	September 30, 2013							December 31, 2012
	Gross Carrying Amount		Accumulated Amortization			Net Carrying Amount		Gross Carrying Amount		Accumulated Amortization			Net Carrying Amount
Patents	$	41,325	$	(33,863	)	$	7,462	$	41,103	$	(32,273	)	$	8,830
Trademarks		66,034		(33,342	)		32,692		64,582		(31,483	)		33,099
Customer relationships, pipeline and backlog		96,109		(23,091	)		73,018		72,050		(14,531	)		57,519
Technology		6,748		(1,687	)		5,061		6,594		(942	)		5,652
Total	$	210,216	$	(91,983	)	$	118,233	$	184,329	$	(79,229	)	$	105,100

As of September 30, 2013, the net carrying amounts of our identifiable intangible assets were $46,863 for our Global Power Group and $71,370 for our Global E&C Group. Amortization expense related to identifiable intangible assets is recorded within cost of operating revenues on the consolidated statement of operations. Amortization expense related to assets other than identifiable intangible assets was not material in the nine months ended September 30, 2013 and 2012.

The following table details amortization expense related to identifiable intangible assets by period:

	Quarter Ended September 30,				Nine Months Ended September 30,
	2013		2012		2013		2012
Amortization expense	$	4,291	$	2,712	$	12,330	$	8,264
Approximate full year amortization expense for years:
2013							$	16,900
2014								17,000
2015								12,500
2016								9,900
2017								9,500

5. Borrowings

The following table shows the components of our long-term debt:

	September 30, 2013						December 31, 2012
	Current		Long-term		Total		Current		Long-term		Total
Capital Lease Obligations	$	2,782	$	51,946	$	54,728	$	2,545	$	53,780	$	56,325
Special-Purpose Limited Recourse Project Debt:
FW Power S.r.l.		8,961		58,529		67,490		9,215		61,575		70,790
Energia Holdings, LLC at 11.443% interest, due April 15, 2015		2,040		5,355		7,395		1,912		7,396		9,308
Subordinated Robbins Facility Exit Funding Obligations: 1999C Bonds at 7.25% interest, due October 15, 2024		—		1,283		1,283		—		1,283		1,283
Total	$	13,783	$	117,113	$	130,896	$	13,672	$	124,034	$	137,706
Estimated fair value					$	145,800					$	155,718

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Senior Credit Agreement — On August 3, 2012, we entered into a new five-year senior unsecured credit agreement, which replaced our amended and restated senior unsecured credit agreement from July 2010. Our new senior credit agreement provides for an unsecured revolving line of credit of $750,000 and contains an increase option permitting us, subject to certain requirements, to arrange with existing lenders and/or new lenders to provide up to an aggregate of $300,000 in additional commitments. During the term of this senior credit agreement, we may request, subject to certain requirements, up to two one-year extensions of the contractual termination date.

We can issue up to $750,000 under the letter of credit portion of the facility. Letters of credit issued under our new senior credit agreement have performance pricing that is decreased (or increased) as a result of improvements (or reductions) in our corporate credit ratings, as defined in the senior credit agreement. Based on our current credit ratings, letter of credit fees for performance and non-performance letters of credit issued under our new senior credit agreement are 0.75% and 1.50% per annum of the outstanding amount, respectively, excluding a nominal fronting fee. We also have the option to use up to $250,000 of the $750,000 for revolving borrowings at a rate equal to adjusted LIBOR, as defined in the senior credit agreement, plus 1.50%, subject also to the performance pricing noted above.

Fees and expenses incurred in conjunction with the execution of our new senior credit agreement were approximately $4,000 and, along with a portion of the remaining unamortized fees from our July 2010 agreement, are being amortized to expense over the five-year term of the agreement, which commenced in the third quarter of 2012.

Our new senior credit agreement contains various customary restrictive covenants. In addition, our new senior credit agreement contains financial covenants relating to leverage and interest coverage ratios. Our total leverage ratio compares total indebtedness to EBITDA, as defined in the credit agreement, and our total interest coverage ratio compares EBITDA, as defined in the credit agreement, to interest expense. Both the leverage and interest coverage ratios are measured quarterly. In addition, the leverage ratio is measured as of any date of determination for certain significant events. All such terms are defined in our new senior credit agreement. We have been in compliance with all financial covenants and other provisions of both our August 2012 and our July 2010 senior credit agreements, while the respective agreements were in effect during the nine months ended September 30, 2013 and 2012.

We had approximately $250,900 and $250,600 of letters of credit outstanding under our senior credit agreement as of September 30, 2013 and December 31, 2012, respectively. The letter of credit fees under our senior credit agreement as of September 30, 2013 and December 31, 2012 ranged from 0.75% to 1.50% of the outstanding amount, excluding fronting fees. There were no funded borrowings outstanding under our senior credit agreement as of September 30, 2013 and December 31, 2012.

6. Pensions and Other Postretirement Benefits

We have defined benefit pension plans in the United States, or U.S., the United Kingdom, or U.K., Canada, Finland, France, India and South Africa, and we have other postretirement benefit plans for health care and life insurance benefits in the U.S. and Canada.

Defined Benefit Pension Plans — Our defined benefit pension plans, or pension plans, cover certain full-time employees. Under the pension plans, retirement benefits are primarily a function of both years of service and level of compensation. The U.S. pension plans, which are closed to new entrants and additional benefit accruals, and the Canada, Finland, France and India pension plans are non-contributory. The U.K. pension plan, which is closed to new entrants and additional benefit accruals, and the South Africa pension plan are both contributory plans.

Based on the minimum statutory funding requirements for 2013, we are not required to make any mandatory contributions to our U.S. pension plans. The following table provides details on 2013 mandatory contribution activity for our non-U.S. pension plans:

Contributions in the nine months ended September 30, 2013	$	14,900
Remaining contributions expected for the year 2013		5,700
Contributions expected for the year 2013	$	20,600

We did not make any discretionary contributions during the first nine months of 2013; however, we may elect to make discretionary contributions to our U.S. and/or non-U.S. pension plans during the remainder of 2013.

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Other Postretirement Benefit Plans — Certain employees in the U.S. and Canada may become eligible for other postretirement benefit plans such as health care and life insurance benefits if they qualify for and commence normal or early retirement pension benefits as defined in the U.S. and Canada pension plans while working for us. Additionally, one of our subsidiaries in the U.S. also has a benefit plan, which provides coverage for an employee’s beneficiary upon the death of the employee. This plan has been closed to new entrants since 1988.

Components of net periodic benefit cost/(credit) include:

	Defined Benefit Pension Plans												Other Postretirement Benefit Plans
	Quarter Ended September 30,						Nine Months Ended September 30,						Quarter Ended September 30,						Nine Months Ended September 30,
	2013			2012			2013			2012			2013			2012			2013			2012
Net periodic benefit cost/(credit):
Service cost	$	277		$	257		$	869		$	794		$	14		$	17		$	42		$	53
Interest cost		12,619			13,160			38,158			39,481			606			687			2,017			2,061
Expected return on plan assets		(16,023	)		(16,042	)		(48,411	)		(48,115	)		—			—			—			—
Amortization of net actuarial loss		4,548			4,251			13,705			12,736			220			107			660			320
Amortization of prior service credit		(383	)		(395	)		(1,159	)		(1,184	)		(874	)		(879	)		(2,622	)		(2,636	)
Amortization of transition obligation		14			13			42			38			—			—			—			—
Net periodic benefit cost/(credit)	$	1,052		$	1,244		$	3,204		$	3,750		$	(34	)	$	(68	)	$	97		$	(202	)

The components of net periodic benefit cost are recognized within cost of operating revenues and selling, general and administrative expenses on our consolidated statement of operations. Please refer to Note 1 for further discussion on the timing of when items in cost of operating revenues are recognized on our consolidated statement of operations under our accounting policy for revenue recognition on long-term contracts, which utilizes the percentage-of-completion method. The offsetting effect of the amortization components of net periodic benefit cost listed above are included in other comprehensive income on our consolidated statement of comprehensive income along with their corresponding tax effects.

7. Guarantees and Warranties

We have agreed to indemnify certain third parties relating to businesses and/or assets that we previously owned and sold to such third parties. Such indemnifications relate primarily to breach of covenants, breach of representations and warranties, as well as potential exposure for retained liabilities, environmental matters and third party claims for activities conducted by us prior to the sale of such businesses and/or assets. It is not possible to predict the maximum potential amount of future payments under these or similar indemnifications due to the conditional nature of the obligations and the unique facts and circumstances involved in each particular indemnification; however many of our indemnification obligations, including for environmental matters, are capped. Historically, our payments under these indemnification obligations have not had a significant effect on our business, financial condition, results of operations or cash flows. We believe that if we were to incur a loss related to any of these matters, such loss would not have a significant effect on our business, financial condition, results of operations or cash flows.

We maintain liabilities for environmental matters for properties owned and for properties covered under the indemnification obligations described above for businesses and/or assets that we previously owned and sold to third parties. As of September 30, 2013 and December 31, 2012, the carrying amounts of our environmental liabilities were $7,000 and $8,500, respectively.

We also maintain contingencies for warranty expenses on certain of our long-term contracts. Generally, warranty contingencies are accrued over the life of the contract so that a sufficient balance is maintained to cover our aggregate exposure at the conclusion of the project.

	Nine Months Ended September 30,
Warranty Liability:	2013			2012
Balance at beginning of year	$	90,100		$	93,000
Accruals		16,700			22,700
Settlements		(10,400	)		(11,400	)
Adjustments to provisions*		(16,000	)		(16,800	)
Foreign currency translation		(100	)		1,500
Balance at end of period	$	80,300		$	89,000

* Adjustments to the provisions represent reversals of warranty provisions that are no longer required.

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We are contingently liable under standby letters of credit, bank guarantees and surety bonds, totaling $945,600 and $1,015,900 as of September 30, 2013 and December 31, 2012, respectively, primarily for guarantees of our performance on projects currently in execution or under warranty. These amounts include the standby letters of credit issued under our senior unsecured credit agreement discussed in Note 5 and under other facilities worldwide. No material claims have been made against these guarantees, and based on our experience and current expectations, we do not anticipate any material claims.

We have also guaranteed certain performance obligations in a refinery/electric power generation project located in Chile in which we hold a noncontrolling interest. See Note 3 for further information.

8. Derivative Financial Instruments

We are exposed to certain risks relating to our ongoing business operations. The risks managed by using derivative financial instruments relate primarily to foreign currency exchange rate risk and, to a significantly lesser extent, interest rate risk. Derivative financial instruments held by our consolidated entities are recognized as assets or liabilities at fair value on our consolidated balance sheet. Our proportionate share of the fair value of derivative financial instruments held by our equity method investees is included in investments in and advances to unconsolidated affiliates on our consolidated balance sheet. The fair values of derivative financial instruments held by our consolidated entities were as follows:

Fair Values of Derivative Financial Instruments
		Asset Derivatives					Liability Derivatives
	Balance Sheet Location	September 30, 2013		December 31, 2012		Balance Sheet Location	September 30, 2013		December 31, 2012
Derivatives designated as hedging instruments:
Interest rate swap contracts	Other assets	$	—	$	—	Other long-term liabilities	$	8,809	$	10,490
Derivatives not designated as hedging instruments:
Foreign currency forward contracts	Contracts in process or billings in excess of costs and estimated earnings on uncompleted contracts		7,603		6,040	Contracts in process or billings in excess of costs and estimated earnings on uncompleted contracts		1,663		4,895
Foreign currency forward contracts	Other accounts receivable		335		1,357	Accounts payable		481		29
Total derivatives		$	7,938	$	7,397		$	10,953	$	15,414

Foreign Currency Exchange Rate Risk

We operate on a worldwide basis with operations that subject us to foreign currency exchange rate risk mainly relative to the British pound, Chinese Yuan, Euro and U.S. dollar as of September 30, 2013. Under our risk management policies, we do not hedge translation risk exposure. All activities of our affiliates are recorded in their functional currency, which is typically the local currency in the country of domicile of the affiliate. In the ordinary course of business, our affiliates enter into transactions in currencies other than their respective functional currencies. We seek to minimize the resulting foreign currency transaction risk by contracting for the procurement of goods and services in the same currency as the sales value of the related long-term contract. We further mitigate the risk through the use of foreign currency forward contracts to hedge the exposed item, such as anticipated purchases or revenues, back to their functional currency.

The notional amount of our foreign currency forward contracts provides one measure of our transaction volume outstanding as of the balance sheet date. As of September 30, 2013, we had a total gross notional amount, measured in U.S. dollar equivalent, of approximately $446,500 related to foreign currency forward contracts. Amounts ultimately realized upon final settlement of these financial instruments, along with the gains and losses on the underlying exposures within our long-term contracts, will depend on actual market exchange rates during the remaining life of the instruments. The contract maturity dates range from the remainder of 2013 through 2015.

We are exposed to credit loss in the event of non-performance by the counterparties. These counterparties are commercial banks that are primarily rated “BBB+” or better by S&P (or the equivalent by other recognized credit rating agencies).

Increases in the fair value of the currencies sold forward result in losses while increases in the fair value of the currencies bought forward result in gains. For foreign currency forward contracts used to mitigate currency risk on our projects, the gain or loss from the portion of the mark-to-market adjustment related to the completed portion of the underlying project is included in cost of operating revenues at the same time as the underlying foreign currency

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exposure occurs. The gain or loss from the remaining portion of the mark-to-market adjustment, specifically the portion relating to the uncompleted portion of the underlying project is reflected directly in cost of operating revenues in the period in which the mark-to-market adjustment occurs. We also utilize foreign currency forward contracts to mitigate non-project related currency risks, which are recorded in other deductions, net.

The gain or loss from the remaining uncompleted portion of our projects and other non-project related transactions were as follows:

Derivatives Not Designated as Hedging Instruments	Location of Gain/(Loss)	Amount of Gain/(Loss) Recognized in Income on  Derivatives
	Recognized	Quarter Ended September 30,				Nine Months Ended September 30,
	in Income on Derivatives	2013		2012		2013			2012
Foreign currency forward contracts	Cost of operating revenues	$	5,616	$	1,692	$	1,700		$	1,192
Foreign currency forward contracts	Other deductions, net		121		753		(1,402	)		831
Total		$	5,737	$	2,445	$	298		$	2,023

The mark-to-market adjustments on foreign currency forward contracts for these unrealized gains or losses are primarily recorded in either contracts in process or billings in excess of costs and estimated earnings on uncompleted contracts on the consolidated balance sheet.

During the nine months ended September 30, 2013 and 2012, we included net cash inflows on the settlement of derivatives of $5,179 and $1,521, respectively, within the “net change in contracts in process and billings in excess of costs and estimated earnings on uncompleted contracts,” a component of cash flows from operating activities on the consolidated statement of cash flows.

Interest Rate Risk

We use interest rate swap contracts to manage interest rate risk associated with a portion of our variable rate special-purpose limited recourse project debt. The aggregate notional amount of the receive-variable/pay-fixed interest rate swaps for our consolidated entities was $59,300 as of September 30, 2013.

Upon entering into the swap contracts, we designate the interest rate swaps as cash flow hedges. We assess at inception, and on an ongoing basis, whether the interest rate swaps are highly effective in offsetting changes in the cash flows of the project debt. Consequently, we record the fair value of interest rate swap contracts on our consolidated balance sheet at each balance sheet date. Changes in the fair value of the interest rate swap contracts are recorded as a component of other comprehensive income. Amounts that are reclassified from accumulated other comprehensive loss are recognized within interest expense on the consolidated statement of operations.

The impact from interest rate swap contracts in cash flow hedging relationships for our consolidated entities was as follows:

	Quarter Ended September 30,						Nine Months Ended September 30,
	2013			2012			2013			2012
Unrealized loss recognized in other comprehensive income	$	(817	)	$	(1,766	)	$	(6	)	$	(3,551	)
Loss reclassified from accumulated other comprehensive loss to interest expense		630			572			1,885			1,507

The above balances for our consolidated entities and our proportionate share of the impact from interest rate swap contracts in cash flow hedging relationships held by our equity method investees are included on our consolidated statement of comprehensive income net of tax.

9. Share-Based Compensation Plans

Our share-based compensation plans include both stock options and restricted awards. The following table summarizes our share-based compensation expense and related income tax benefit:

	Quarter Ended September 30,				Nine Months Ended September 30,
	2013		2012		2013		2012
Share-based compensation	$	4,638	$	5,668	$	14,119	$	16,362
Related income tax benefit		153		144		599		403

As of September 30, 2013, we had total unrecognized compensation cost related to restricted share units, or RSUs, performance-based restricted share units, or performance RSUs, and stock options of $15,545, $8,170 and $3,725, respectively. Those amounts are expected to be recognized as expense over a weighted-average period of approximately two years.

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We estimate the fair value of RSU awards using the market price of our shares on the date of grant. We then recognize the fair value of each RSU award as compensation expense ratably using the straight-line attribution method over the service period (generally the vesting period).

Under our performance RSU awards, the number of restricted share units that ultimately vest depend on our share price performance against specified performance goals, which are defined in our performance RSU award agreements. We estimate the grant date fair value of each performance RSU award using a Monte Carlo valuation model. We then recognize the fair value of each performance RSU award as compensation expense ratably using the straight-line attribution method over the service period (generally the vesting period).

We estimate the fair value of each option award on the date of grant using the Black-Scholes option valuation model. We then recognize the grant date fair value of each option as compensation expense ratably using the straight-line attribution method over the service period (generally the vesting period). The Black-Scholes model incorporates the following assumptions:

• Expected volatility – we estimate the volatility of our share price at the date of grant using a “look-back” period which coincides with the expected term, defined below. We believe using a “look-back” period which coincides with the expected term is the most appropriate measure for determining expected volatility.

• Expected term – we estimate the expected term using the “simplified” method, as outlined in Staff Accounting Bulletin No. 107, “Share-Based Payment.”

• Risk-free interest rate – we estimate the risk-free interest rate using the U.S. Treasury yield curve for periods equal to the expected term of the options in effect at the time of grant.

• Dividends – we use an expected dividend yield of zero because we have not declared or paid a cash dividend since July 2001 and we do not have any plans to declare or pay any cash dividends.

Our share-based compensation plans include a “change in control” provision, which provides for possible cash redemption of equity awards issued thereunder in certain limited circumstances. In accordance with Securities and Exchange Commission Accounting Series Release No. 268, “Presentation in Financial Statements of Redeemable Preferred Stocks,” we present the redemption amount of these equity awards as temporary equity on the consolidated balance sheet as the equity award is amortized during the vesting period. The redemption amount represents the intrinsic value of the equity award on the grant date. In accordance with current accounting guidance regarding the classification and measurement of redeemable securities, we do not adjust the redemption amount each reporting period unless and until it becomes probable that the equity awards will become redeemable (upon a change in control event). Upon vesting of the equity awards, we reclassify the intrinsic value of the equity awards, as determined on the grant date, to permanent equity.

Reconciliations of temporary equity for the nine months ended September 30, 2013 and 2012 were as follows:

	Nine Months Ended September 30,
	2013			2012
Balance at beginning of year	$	8,594		$	4,993
Compensation cost during the period for those equity awards with intrinsic value on the grant date		11,085			10,092
Intrinsic value of equity awards vested during the period for those equity awards with intrinsic value on the grant date		(7,366	)		(5,440	)
Balance at end of period	$	12,313		$	9,645

Our articles of association provide for conditional capital for the issuance of shares under our share-based compensation plans and other convertible or exercisable securities we may issue in the future. Conditional capital decreases upon issuance of shares in connection with the exercise of outstanding stock options or vesting of restricted awards, with an offsetting increase to our issued and authorized share capital. As of September 30, 2013, our remaining available conditional capital was 58,874,658 shares.

10. Income Taxes

Although we are a Swiss corporation, our shares are listed on a U.S. exchange; therefore, we reconcile our effective tax rate to the U.S. federal statutory rate of 35% to facilitate meaningful comparison with peer companies in the U.S. capital markets. Our effective tax rate can fluctuate significantly from period to period and may differ considerably from the U.S. federal statutory rate as a result of (i) income taxed in various non-U.S. jurisdictions with rates different from the U.S. statutory rate, (ii) our inability to recognize a tax benefit for losses generated by certain

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unprofitable operations and (iii) the varying mix of income earned in the jurisdictions in which we operate. In addition, our deferred tax assets are reduced by a valuation allowance when, based upon available evidence, it is more likely than not that the tax benefit of loss carryforwards (or other deferred tax assets) will not be realized in the future. In periods when operating units subject to a valuation allowance generate pre-tax earnings, the corresponding reduction in the valuation allowance favorably impacts our effective tax rate. Conversely, in periods when operating units subject to a valuation allowance generate pre-tax losses, the corresponding increase in the valuation allowance has an unfavorable impact on our effective tax rate.

Effective Tax Rate for 2013

Our effective tax rate for the first nine months of 2013 was lower than the U.S. statutory rate of 35% due principally to the net impact of the following:

• Income earned in non-U.S. jurisdictions which contributed to an approximate 17-percentage point reduction in our effective tax rate, primarily because of tax rates lower than the U.S. statutory rate, as well as additional impacts from equity income of joint ventures, tax incentives and credits, and other items;

• Discrete items, primarily relating to the reversal of a previously accrued liability for branch taxes no longer required to be paid as a result of an exemption received from a non-U.S. tax authority, which was partially offset by the impact of a change in tax rate on net deferred assets in a non-U.S. jurisdiction, provided a net one-percentage point reduction to the effective tax rate; and

• A valuation allowance increase because we are unable to recognize a tax benefit for year-to-date losses subject to a valuation allowance in certain jurisdictions (primarily in the U.S.), partially offset by valuation allowance releases in certain non-U.S. jurisdictions, which contributed to an approximate three-percentage point increase in our effective tax rate.

Effective Tax Rate for 2012

Our effective tax rate for the first nine months of 2012 was lower than the U.S. statutory rate of 35% due principally to the net impact of the following:

• Income earned in non-U.S. jurisdictions which contributed to an approximate 15-percentage point reduction in our effective tax rate, primarily because of tax rates lower than the U.S. statutory rate, as well as additional impacts from equity income of joint ventures, tax incentives and credits, and other items; and

• A valuation allowance increase because we were unable to recognize a tax benefit for year-to-date losses subject to a valuation allowance in certain jurisdictions (primarily in the U.S.), which contributed to an approximate two-percentage point increase in our effective tax rate.

We monitor the jurisdictions for which valuation allowances against deferred tax assets were established in previous years, and we evaluate, on a quarterly basis, the need for the valuation allowances against deferred tax assets in those jurisdictions. Such evaluation includes a review of all available evidence, both positive and negative, in determining whether a valuation allowance is necessary.

The majority of the U.S. federal tax benefits, against which valuation allowances have been established, do not expire until 2026 and beyond, based on current tax laws.

Our subsidiaries file income tax returns in many tax jurisdictions, including the U.S., several U.S. states and numerous non-U.S. jurisdictions around the world. Tax returns are also filed in jurisdictions where our subsidiaries execute project-related work. The statute of limitations varies by jurisdiction. Because of the number of jurisdictions in which we file tax returns, in any given year the statute of limitations in a number of jurisdictions may expire within 12 months from the balance sheet date. As a result, we expect recurring changes in unrecognized tax benefits due to the expiration of the statute of limitations, none of which are expected to be individually significant. With few exceptions, we are no longer subject to U.S. (including federal, state and local) or non-U.S. income tax examinations by tax authorities for years before 2008.

A number of tax years are under audit by the relevant tax authorities in various jurisdictions. We anticipate that several of these audits may be concluded in the foreseeable future, including during the remainder of 2013. Based on the status of these audits, it is reasonably possible that the conclusion of the audits may result in a reduction of unrecognized tax benefits. However, it is not possible to estimate the magnitude of any such reduction at this time. We recognize interest accrued on the unrecognized tax benefits in interest expense and penalties on the unrecognized tax benefits in other deductions, net on our consolidated statement of operations.

11. Business Segments

We operate through two operating segments, or groups: our Global E&C Group and our Global Power Group.

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Global E&C Group

Our Global E&C Group, which operates worldwide, designs, engineers and constructs onshore and offshore upstream oil and gas processing facilities, natural gas liquefaction facilities and receiving terminals, gas-to-liquids facilities, oil refining, chemical and petrochemical, pharmaceutical and biotechnology facilities and related infrastructure, including power generation facilities, distribution facilities, gasification facilities and processing facilities associated with the minerals and metals sector. Our Global E&C Group is also involved in the design of facilities in developing market sectors, including carbon capture and storage, solid fuel-fired integrated gasification combined-cycle power plants, coal-to-liquids, coal-to-chemicals and biofuels. Additionally, our Global E&C Group owns and operates electric power generating wind farms in Italy and also owns a noncontrolling interest in two electric power generation projects, one waste-to-energy project and one wind farm project, all of which are located in Italy, and a noncontrolling interest in a joint venture company that is fully licensed to engineer, procure and construct process facilities in China. Our Global E&C Group generates revenues from design, engineering, procurement, construction and project management activities pursuant to contracts which generally span up to approximately four years in duration and from returns on its equity investments in various power production facilities.

Global Power Group

Our Global Power Group designs, manufactures and erects steam generating and auxiliary equipment for electric power generating stations, district heating and industrial facilities worldwide. Additionally, our Global Power Group holds a controlling interest and operates a combined-cycle gas turbine facility; owns a noncontrolling interest in a petcoke-fired circulating fluidized-bed facility for refinery steam and power generation; and operates a university cogeneration power facility for steam/electric generation. Our Global Power Group generates revenues from engineering activities, equipment supply, construction contracts, operating and maintenance agreements, royalties from licensing its technology, and from returns on its investments in various power production facilities.

Our Global Power Group’s steam generating equipment includes a broad range of steam generation and environmental technologies, offering independent power producers, utilities, municipalities and industrial clients high-value technology solutions for converting a wide range of fuels, such as coal, lignite, petroleum coke, oil, gas, solar, biomass, municipal solid waste and waste flue gases into steam, which can be used for power generation, district heating or industrial processes.

Corporate and Finance Group

In addition to our Global E&C Group and Global Power Group, which represent two of our operating segments for financial reporting purposes, we report the financial results associated with the management of entities which are not managed by one of our two business groups, which include corporate center expenses, our captive insurance operation and expenses related to certain legacy liabilities, such as asbestos, in the Corporate and Finance Group, which also represents an operating segment for financial reporting purposes and which we refer to as the C&F Group.

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Operating Revenues

We conduct our business on a global basis. Operating revenues for our continuing operations by industry, operating segment and geographic regions, based upon where our projects are being executed, were as follows:

	Quarter Ended September 30,				Nine Months Ended September 30,
	2013		2012		2013		2012
Operating Revenues (Third-Party) by Industry:
Power generation	$	194,258	$	214,742	$	563,713	$	729,178
Oil refining		323,019		337,067		1,006,651		1,022,978
Pharmaceutical		29,308		13,606		107,706		40,199
Oil and gas		83,145		109,466		254,626		524,580
Chemical/petrochemical		124,284		80,209		360,831		225,956
Power plant design, operation and maintenance		41,773		28,248		125,282		80,371
Environmental		1,426		1,790		4,271		6,434
Other, net of eliminations		4,613		12,168		32,297		31,652
Total	$	801,826	$	797,296	$	2,455,377	$	2,661,348
Operating Revenues (Third-Party) by Business Segment:
Global E&C Group	$	615,028	$	578,072	$	1,865,721	$	1,915,087
Global Power Group		186,798		219,224		589,656		746,261
Total	$	801,826	$	797,296	$	2,455,377	$	2,661,348
Operating Revenues (Third-Party) by Geographic Region:
Africa	$	12,694	$	22,475	$	52,341	$	70,136
Asia Pacific		208,073		231,267		612,348		947,867
Europe		192,318		189,003		596,154		647,935
Middle East		91,482		65,166		236,284		178,015
North America		205,570		211,711		729,583		572,826
South America		91,689		77,674		228,667		244,569
Total	$	801,826	$	797,296	$	2,455,377	$	2,661,348

EBITDA

EBITDA is the primary measure of operating performance used by our chief operating decision maker. We define EBITDA as net income attributable to Foster Wheeler AG before interest expense, income taxes and depreciation and amortization.

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A reconciliation of EBITDA to net income attributable to Foster Wheeler AG is shown below:

	Quarter Ended September 30,						Nine Months Ended September 30,
	2013			2012			2013			2012
EBITDA:
Global E&C Group	$	59,940		$	51,964		$	157,261		$	138,809
Global Power Group		45,428			64,396			115,699			158,535
C&F Group*		(21,301	)		(25,528	)		(49,810	)		(76,398	)
Discontinued operations		1,760			752			4,184			2,779
Total EBITDA		85,827			91,584			227,334			223,725
Less: Discontinued operations		1,760			752			4,184			2,779
EBITDA from continuing operations		84,067			90,832			223,150			220,946
Add: Net (loss)/income attributable to noncontrolling interests		(467	)		4,057			3,823			10,712
Less: Interest expense		3,388			3,197			9,976			10,862
Less: Depreciation and amortization		14,032			12,178			42,828			35,541
Income from continuing operations before income taxes		66,180			79,514			174,169			185,255
Less: Provision for income taxes		17,794			16,790			36,273			43,965
Income from continuing operations		48,386			62,724			137,896			141,290
Income/(loss) from discontinued operations		1,760			(445	)		265			(851	)
Net income		50,146			62,279			138,161			140,439
Less: Net (loss)/income attributable to noncontrolling interests		(467	)		4,057			3,823			10,712
Net income attributable to Foster Wheeler AG	$	50,613		$	58,222		$	134,338		$	129,727

* Includes general corporate income and expense, our captive insurance operation and the elimination of transactions and balances related to intercompany interest.

EBITDA in the above table includes the following:

	Quarter Ended September 30,				Nine Months Ended September 30,
	2013		2012		2013			2012
Net increase in contract profit from the regular revaluation of final estimated contract profit revisions:(1)
Global E&C Group(2)	$	13,800	$	7,000	$	38,200		$	12,100
Global Power Group(3)		16,400		15,700		36,600			45,900
Total	$	30,200	$	22,700	$	74,800		$	58,000
Net asbestos-related provision/(gain):(4)
Global E&C Group		—		—		—			1,700
C&F Group		2,000		2,000		(9,800	)		6,000
Total	$	2,000	$	2,000	$	(9,800	)	$	7,700
Charges for severance-related postemployment benefits:
Global E&C Group	$	1,000	$	—	$	3,900		$	—
Global Power Group		3,000		—		4,100			—
C&F Group		—		—		400			—
Total	$	4,000	$	—	$	8,400		$	—

(1) Please refer to “Revenue Recognition on Long-Term Contracts” in Note 1 for further information regarding changes in our final estimated contract profit.

(2) The changes in final estimated contract profit revisions for our Global E&C Group and our financial results did not include an increase in final estimated contract profit of approximately $5,300 during the quarter and nine months ended September 30, 2012. The correction was recorded in the quarter ended December 31, 2012 as it was not material to the financial results for the quarter and nine months ended September 30, 2012 (the periods in which it should have been recorded), nor was it material to the financial results for the year ended December 31, 2012.

(3) The changes in final estimated contract profit revisions for our Global Power Group were increased during the nine months ended September 30, 2012 for a favorable settlement with a subcontractor of approximately $6,900.

(4) Please refer to Note 12 for further information regarding the revaluation of our asbestos liability and related asset.

The accounting policies of our business segments are the same as those described in our summary of significant accounting policies as disclosed in our 2012 Form 10-K. The only significant intersegment transactions relate to interest on intercompany balances. We account for interest on those arrangements as if they were third-party transactions (i.e., at current market rates) and we include the elimination of that activity in the results of the C&F Group.

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Income/(loss) from discontinued operations included the following:

	Quarter Ended September 30,					Nine Months Ended September 30,
	2013		2012			2013		2012
EBITDA from discontinued operations	$	1,760	$	752		$	4,184	$	2,779
Less: Interest expense		—		—			—		—
Less: Depreciation and amortization*		—		1,197			3,919		3,630
Income/(loss) from discontinued operations before income taxes*		1,760		(445	)		265		(851	)
Less: Provision for income taxes		—		—			—		—
Income/(loss) from discontinued operations*	$	1,760	$	(445	)	$	265	$	(851	)

* During the nine months ended September 30, 2013, we recorded an impairment charge of $3,919 at our Camden, New Jersey waste-to-energy facility which was recorded as depreciation expense within income/(loss) from discontinued operations. Please refer to Note 13 for further information.

12. Litigation and Uncertainties

Asbestos

Some of our U.S. and U.K. subsidiaries are defendants in numerous asbestos-related lawsuits and out-of-court informal claims pending in the U.S. and the U.K. Plaintiffs claim damages for personal injury alleged to have arisen from exposure to or use of asbestos in connection with work allegedly performed by our subsidiaries during the 1970s and earlier.

United States

A summary of our U.S. claim activity is as follows:

	Quarter Ended September 30,						Nine Months Ended September 30,
Number of Claims by period:	2013			2012			2013			2012
Open claims at beginning of period		124,810			124,680			125,310			124,540
New claims		950			1,130			3,410			3,470
Claims resolved		(510	)		(1,210	)		(3,470	)		(3,410	)
Open claims at end of period		125,250			124,600			125,250			124,600

We had the following U.S. asbestos-related assets and liabilities recorded on our consolidated balance sheet as of the dates set forth below. Total U.S. asbestos-related liabilities are estimated through the third quarter of 2028. Although it is likely that claims will continue to be filed after that date, the uncertainties inherent in any long-term forecast prevent us from making reliable estimates of the indemnity and defense costs that might be incurred after that date.

U.S. Asbestos	September 30, 2013		December 31, 2012
Asbestos-related assets recorded within:
Accounts and notes receivable-other	$	22,184	$	33,626
Asbestos-related insurance recovery receivable		86,195		102,751
Total asbestos-related assets	$	108,379	$	136,377
Asbestos-related liabilities recorded within:
Accrued expenses	$	35,127	$	47,900
Asbestos-related liability		207,380		227,400
Total asbestos-related liabilities	$	242,507	$	275,300
Liability balance by claim category:
Open claims	$	37,856	$	42,700
Future unasserted claims		204,651		232,600
Total asbestos-related liabilities	$	242,507	$	275,300

We have worked with Analysis, Research & Planning Corporation, or ARPC, nationally recognized consultants in the U.S. with respect to projecting asbestos liabilities, to estimate the amount of asbestos-related indemnity and defense costs at each year-end based on a forecast for the next 15 years. Each year we have recorded our estimated

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asbestos liability at a level consistent with ARPC’s reasonable best estimate. Our estimated asbestos liability decreased during the first nine months of 2013 as a result of indemnity and defense cost payments totaling approximately $38,800, partially offset by the impact of a $6,000 increase in the liability related to our rolling 15-year asbestos-related liability estimate. The total asbestos-related liabilities are comprised of our estimates for our liability relating to open (outstanding) claims being valued and our liability for future unasserted claims through the third quarter of 2028.

Our liability estimate is based upon the following information and/or assumptions: number of open claims, forecasted number of future claims, estimated average cost per claim by disease type – mesothelioma, lung cancer and non-malignancies – and the breakdown of known and future claims into disease type – mesothelioma, lung cancer and non-malignancies, as well as other factors. The total estimated liability, which has not been discounted for the time value of money, includes both the estimate of forecasted indemnity amounts and forecasted defense costs. Total defense costs and indemnity liability payments are estimated to be incurred through the third quarter of 2028, during which period the incidence of new claims is forecasted to decrease each year. We believe that it is likely that there will be new claims filed after the third quarter of 2028, but in light of uncertainties inherent in long-term forecasts, we do not believe that we can reasonably estimate the indemnity and defense costs that might be incurred after the third quarter of 2028.

Through September 30, 2013, total cumulative indemnity costs paid, prior to insurance recoveries, were approximately $818,600 and total cumulative defense costs paid were approximately $404,500, or approximately 33% of total defense and indemnity costs. The overall historic average combined indemnity and defense cost per resolved claim through September 30, 2013 has been approximately $3.3. The average cost per resolved claim is increasing and we believe it will continue to increase in the future.

Over the last several years, certain of our subsidiaries have entered into settlement agreements calling for insurers to make lump-sum payments, as well as payments over time, for use by our subsidiaries to fund asbestos-related indemnity and defense costs and, in certain cases, for reimbursement for portions of out-of-pocket costs previously incurred. As our subsidiaries reach agreements with their insurers to settle their disputed asbestos-related insurance coverage, we increase our asbestos-related insurance asset and record settlement gains.

Asbestos-related assets under executed settlement agreements with insurers due in the next 12 months are recorded within accounts and notes receivable-other and amounts due beyond 12 months are recorded within asbestos-related insurance recovery receivable. Asbestos-related insurance recovery receivable also includes our best estimate of actual and probable insurance recoveries relating to our liability for pending and estimated future asbestos claims through the third quarter of 2028. Our asbestos-related assets have not been discounted for the time value of money.

Our insurance recoveries may be limited by future insolvencies among our insurers. Other than receivables related to bankruptcy court-approved settlements during liquidation proceedings, we have not assumed recovery in the estimate of our asbestos-related insurance asset from any of our currently insolvent insurers. We have considered the financial viability and legal obligations of our subsidiaries’ insurance carriers and believe that the insurers or their guarantors will continue to reimburse a significant portion of claims and defense costs relating to asbestos litigation. As of September 30, 2013 and December 31, 2012, we have not recorded an allowance for uncollectible balances against our asbestos-related insurance assets. We write off receivables from insurers that have become insolvent; there were no such write-offs during the nine months ended September 30, 2013 and 2012. Insurers may become insolvent in the future and our insurers may fail to reimburse amounts owed to us on a timely basis. If we fail to realize the expected insurance recoveries, or experience delays in receiving material amounts from our insurers, our business, financial condition, results of operations and cash flows could be materially adversely affected. During the nine months ended September 30, 2013, we recognized a gain as the result of the collection of a $15,750 insurance receivable related to an insolvent insurance carrier, which we had previously written-off. The proceeds were received as a result of a bankruptcy court-approved settlement during liquidation proceedings related to the insolvent insurance carrier.

The following table summarizes our U.S. net asbestos-related (gain)/provision:

	Quarter Ended September 30,				Nine Months Ended September 30,
	2013		2012		2013			2012
Provision for revaluation	$	2,000	$	2,000	$	6,000		$	5,997
Gain on the settlement of coverage litigation		—		—		(15,750	)		—
Net asbestos-related (gain)/provision	$	2,000	$	2,000	$	(9,750	)	$	5,997

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Our net asbestos-related gain in the nine months ended September 30, 2013 was the net result of the favorable impact of the inclusion of a gain recognized during the nine months ended September 30, 2013 upon collection of a $15,750 insurance receivable related to an insolvent insurance carrier, which had been previously written-off, as discussed above, partially offset by the unfavorable impact related to the provision for our rolling 15-year asbestos liability estimate, net of anticipated insurance recoveries in each respective period.

The following table summarizes our approximate U.S. asbestos-related net cash impact for indemnity and defense cost payments and collection of insurance proceeds:

	Quarter Ended September 30,						Nine Months Ended September 30,
	2013			2012			2013			2012
Asbestos litigation, defense and case resolution payments	$	12,400		$	12,100		$	38,800		$	40,700
Insurance proceeds		(15,500	)		(15,800	)		(43,800	)		(37,500	)
Net asbestos-related (proceeds)/payments	$	(3,100	)	$	(3,700	)	$	(5,000	)	$	3,200

We expect to have net cash outflows of $1,100 during the full year 2013 as a result of asbestos liability indemnity and defense payments in excess of insurance proceeds, which includes the impact of the cash proceeds received from the collection of an insurance receivable balance from an insolvent insurance carrier discussed above. This estimate assumes no settlements with insurance companies and no elections by us to fund additional payments. As we continue to collect cash from insurance settlements and assuming no increase in our asbestos-related insurance liability, the asbestos-related insurance receivable recorded on our consolidated balance sheet will continue to decrease.

The estimate of the liabilities and assets related to asbestos claims and recoveries is subject to a number of uncertainties that may result in significant changes in the current estimates. Among these are uncertainties as to the ultimate number and type of claims filed, the amounts of claim costs, the impact of bankruptcies of other companies with asbestos claims, uncertainties surrounding the litigation process from jurisdiction to jurisdiction and from case to case, as well as potential legislative changes. Increases in the number of claims filed or costs to resolve those claims could cause us to increase further the estimates of the costs associated with asbestos claims and could have a material adverse effect on our financial condition, results of operations and cash flows.

Based on our December 31, 2012 liability estimate, an increase of 25% in the average per claim indemnity settlement amount would increase the liability by $42,000 and the impact on expense would be dependent upon available additional insurance recoveries. Assuming no change to the assumptions currently used to estimate our insurance asset, this increase would result in a charge on our consolidated statement of operations of approximately 85% of the increase in the liability. Long-term cash flows would ultimately change by the same amount. Should there be an increase in the estimated liability in excess of 25%, the percentage of that increase that would be expected to be funded by additional insurance recoveries will decline.

United Kingdom

Some of our subsidiaries in the U.K. have also received claims alleging personal injury arising from exposure to asbestos. To date, 1,043 claims have been brought against our U.K. subsidiaries, of which 284 remained open as of September 30, 2013. None of the settled claims have resulted in material costs to us.

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The following table summarizes our asbestos-related liabilities and assets for our U.K. subsidiaries based on open (outstanding) claims and our estimate for future unasserted claims through the third quarter of 2028:

U.K. Asbestos	September 30, 2013		December 31, 2012
Asbestos-related assets:
Accounts and notes receivable-other	$	1,021	$	1,022
Asbestos-related insurance recovery receivable		27,993		29,687
Total asbestos-related assets	$	29,014	$	30,709
Asbestos-related liabilities:
Accrued expenses	$	1,021	$	1,022
Asbestos-related liability		30,252		31,950
Total asbestos-related liabilities	$	31,273	$	32,972
Liability balance by claim category:
Open claims	$	6,177	$	7,843
Future unasserted claims		25,096		25,129
Total asbestos-related liabilities	$	31,273	$	32,972

The liability estimates are based on a U.K. House of Lords judgment that pleural plaque claims do not amount to a compensable injury. If this ruling is reversed by legislation, the total asbestos liability recorded in the U.K. would increase to approximately $44,700, with a corresponding increase in the asbestos-related asset.

Project Claims

In addition to the specific matters described below, in the ordinary course of business, we are parties to litigation involving clients and subcontractors arising out of project contracts. Such litigation includes claims and counterclaims by and against us for canceled contracts, for additional costs incurred in excess of current contract provisions, as well as for back charges for alleged breaches of warranty and other contract commitments. If we were found to be liable for any of the claims/counterclaims against us, we would incur a charge against earnings to the extent a reserve had not been established for the matter in our accounts or if the liability exceeds established reserves.

Due to the inherent commercial, legal and technical uncertainties underlying the estimation of our project claims, the amounts ultimately realized or paid by us could differ materially from the balances, if any, included in our financial statements, which could result in additional material charges against earnings, and which could also materially adversely impact our financial condition and cash flows.

Power Plant Arbitration – United States

In June 2011, a demand for arbitration was filed with the American Arbitration Association by our client’s erection contractor against our client and us in connection with a power plant project in the U.S. At that time, no details of the erection contractor’s claims were included with the demand. The arbitration panel was formed on September 26, 2012 and a detailed Statement of Claim from the erection contractor was delivered to the panel on October 24, 2012. According to the claim, the erection contractor is seeking unpaid contract amounts from our client and additional compensation from our client and us for alleged delays, disruptions, inefficiencies, and extra work in connection with the erection of the plant. We supplied the steam generation equipment for the project under contract with our client, the power plant owner. The turbine contractor, who supplied the turbine, electricity generator and other plant equipment under a separate contract with the power plant owner, has also been included as a party in the arbitration. The erection contractor is seeking approximately $240,000 in damages, exclusive of interest, from our client. Of this amount, the statement of claim asserts that approximately $150,000 is related to the steam generation equipment, and alleges failure on our part in connection with our performance under our steam generation equipment supply contract; those damages are claimed jointly against us and our client. The claims against us by the erection contractor allege negligence and, in its purported capacity as a third party beneficiary and assignee of our steam generation equipment supply contract, breach of contract.

Responsive pleadings to the erection contractor’s pleading were filed by the other parties, including us, on November 28, 2012. Our pleading denies the erection contractor’s claims against us and asserts cross claims against our client seeking over $14,800 in damages related to delays, out of scope work, and improperly assessed delay liquidated damages. In its pleading, the turbine contractor asserts claims against our client for unpaid contract amounts and additional compensation for extra work and delays. In its capacity as a purported co-assignee of the steam generation equipment supply contract, the turbine contractor joins in the erection contractor’s claims against us for delay-related damages and asserts cross claims against us seeking over $5,000 in non-delay related damages.

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In its pleading, our client asserts counter and cross claims for breach of contract and gross negligence against the erection contractor and the turbine contractor. Our client also asserts cross claims against us for any damages our client has incurred, and for indemnification of any damages our client may be required to pay to the erection and turbine contractors, arising out of alleged failures of performance on our part under our steam generation supply contract. We have denied our client’s and the turbine contractor’s cross claims against us.

On August 30, 2013, our client filed a petition with the U.S. Bankruptcy Court, for the District of Delaware, seeking to reorganize under Chapter 11 of the U.S. Bankruptcy Code. The filing automatically stayed all proceedings against our client, including the four-party arbitration discussed above. Our client’s filing included a motion seeking authorization for the use of cash collateral to fund its activities during the bankruptcy proceedings. In its motion, our client indicated its intent to draw on performance and retention letters of credit we previously issued in connection with the contract totaling approximately $59,000, contending that the funds were needed to fund the bankruptcy and make repairs to the power plant. We opposed the motion on various grounds, including that any such draw would be unsupported and wrongful, and applied for an order temporarily restraining our client from drawing on the letters of credit, lifting the automatic stay of the arbitration proceeding and transferring the question of our client’s right to draw on our letters of credit back to the arbitration for resolution in the context of the overall dispute. The bankruptcy court granted our application for temporary restraint and scheduled a further hearing on the issue, which on successive applications by our client was adjourned to November 21, 2013. On November 1, 2013, our client filed a motion seeking the bankruptcy court’s approval of proposed debtor-in-possession financing. Based upon the timetable proposed in the motion, it does not appear that the bankruptcy court will decide the question of our client’s right to draw on our letters of credit on November 21, 2013. The date for decision on that question is at present uncertain. The court’s temporary restraint order remains in place while the court’s decision on the draw remains open.

We cannot predict the ultimate outcome of this matter at this time.

Refinery and Petrochemicals Project Arbitration – India

In November 2012, we commenced arbitration in India against our client seeking collection of unpaid receivables in excess of £52,000 (approximately $83,900 based on the exchange rate in effect as of September 30, 2013), arising from services performed on a reimbursable basis for our client in connection with our client’s grass roots refinery and petrochemicals project in northeastern India. Our client rejected the claims and notified us of various potential counterclaims that it may be asserting in the arbitration, purportedly totaling in excess of £55,000 (approximately $88,800 based on the exchange rate in effect as of September 30, 2013). In June 2013, we submitted our detailed statement of claim, and in July 2013 our client submitted its detailed statement of defense and counterclaim. The amount of the counterclaim was increased to approximately £620,000 (approximately $1,000,800 based on the exchange rate in effect as of September 30, 2013) in damages, including among other claims a claim for lost profits due to delay in the execution of the project. The counterclaim concerns a number of alleged issues arising in connection with our execution of the engineering, procurement, and construction management scope of our contract, from the period from contract award until the subsequent transfer by our client of our remaining engineering, procurement and construction management scope to certain lump sum turnkey contractors hired directly by our client. Our client further contends that we are liable for delays to the project and has withheld payment on account of delay liquidated damages and, out of the total claim of £620,000 (approximately $1,000,800 based on the exchange rate in effect as of September 30, 2013) cited above, is seeking damages for lost profits in the amount of £555,000 (approximately $895,900 based on the exchange rate in effect as of September 30, 2013). We strongly dispute these contentions. Any liability for delay damages is capped under the contract at a specified percentage of our contract value, currently equivalent to approximately £11,500 (approximately $18,600 based on the exchange rate in effect as of September 30, 2013), an amount already retained by our client. The contract also excludes liability for consequential damages, including lost profits, and contains an overall cap on liability for claims in the aggregate of up to a specified percentage of our contract value, currently equivalent to approximately £28,800 (approximately $46,500 based on the exchange rate in effect as of September 30, 2013). The unpaid amount for which we are seeking reimbursement in the arbitration may increase should our client continue to withhold amounts from our invoices, as the project is still in execution. The arbitration panel has been formed. Our client moved to dismiss the arbitration as premature under the terms of the contract, and we opposed that motion. The motion has been denied by the panel. Also, pursuant to our request, the panel has scheduled a hearing early in the first quarter of 2014 for our claims for unpaid receivables, along with our client’s counterclaim for a deductive change order in the amount of approximately £21,600 (approximately $34,900 based on the exchange rate in effect as of September 30, 2013). The remaining claims and counterclaims, including our client’s counterclaim for lost profits, are scheduled to be heard late in the fourth quarter of 2014. We cannot predict the ultimate outcome of this matter at this time.

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Environmental Matters

CERCLA and Other Remedial Matters

Under U.S. federal statutes, such as the Resource Conservation and Recovery Act, Comprehensive Environmental Response, Compensation, and Liability Act of 1980 (“CERCLA”), the Clean Water Act and the Clean Air Act, and similar state laws, the current owner or operator of real property and the past owners or operators of real property (if disposal of toxic or hazardous substances took place during such past ownership or operation) may be jointly and severally liable for the costs of removal or remediation of toxic or hazardous substances on or under their property, regardless of whether such materials were released in violation of law or whether the owner or operator knew of, or was responsible for, the presence of such substances. Moreover, under CERCLA and similar state laws, persons who arrange for the disposal or treatment of hazardous or toxic substances may also be jointly and severally liable for the costs of the removal or remediation of such substances at a disposal or treatment site, whether or not such site was owned or operated by such person, which we refer to as an off-site facility. Liability at such off-site facilities is typically allocated among all of the financially viable responsible parties based on such factors as the relative amount of waste contributed to a site, toxicity of such waste, relationship of the waste contributed by a party to the remedy chosen for the site and other factors.

We currently own and operate industrial facilities and we have also transferred our interests in industrial facilities that we formerly owned or operated. It is likely that as a result of our current or former operations, hazardous substances have affected the facilities or the real property on which they are or were situated. We also have received and may continue to receive claims pursuant to indemnity obligations from the present owners of facilities we have transferred, which claims may require us to incur costs for investigation and/or remediation.

We are currently engaged in the investigation and/or remediation under the supervision of the applicable regulatory authorities at four of our or our subsidiaries’ former facilities (including Mountain Top, which is described below). In addition, we sometimes engage in investigation and/or remediation without the supervision of a regulatory authority. Although we do not expect the environmental conditions at our present or former facilities to cause us to incur material costs in excess of those for which reserves have been established, it is possible that various events could cause us to incur costs materially in excess of our present reserves in order to fully resolve any issues surrounding those conditions. Further, no assurance can be provided that we will not discover additional environmental conditions at our currently or formerly owned or operated properties, or that additional claims will not be made with respect to formerly owned properties, requiring us to incur material expenditures to investigate and/or remediate such conditions.

We have been notified that we are a potentially responsible party (“PRP”) under CERCLA or similar state laws at three off-site facilities. At each of these sites, our liability should be substantially less than the total site remediation costs because the percentage of waste attributable to us compared to that attributable to all other PRPs is low. We do not believe that our share of cleanup obligations at any of the off-site facilities as to which we have received a notice of potential liability will exceed $500 in the aggregate. We have also received and responded to a request for information from the United States Environmental Protection Agency (“USEPA”) regarding a fourth off-site facility. We do not know what, if any, further actions USEPA may take regarding this fourth off-site facility.

Mountain Top

In February 1988, one of our subsidiaries, Foster Wheeler Energy Corporation (“FWEC”), entered into a Consent Agreement and Order with the USEPA and the Pennsylvania Department of Environmental Protection (“PADEP”) regarding its former manufacturing facility in Mountain Top, Pennsylvania. The order essentially required FWEC to investigate and remediate as necessary contaminants, including trichloroethylene (“TCE”), in the soil and groundwater at the facility. Pursuant to the order, in 1993 FWEC installed a “pump and treat” system to remove TCE from the groundwater. It is not possible at the present time to predict how long FWEC will be required to operate and maintain this system.

In the fall of 2004, FWEC sampled the private domestic water supply wells of certain residences in Mountain Top and identified approximately 30 residences whose wells contained TCE at levels in excess of Safe Drinking Water Act standards. The subject residences are located approximately one mile to the southwest of where the TCE previously was discovered in the soils at the former FWEC facility. Since that time, FWEC, USEPA and PADEP have cooperated in responding to the foregoing. Although FWEC believed the evidence available was not sufficient to support a determination that FWEC was responsible for the TCE in the residential wells, FWEC immediately provided the affected residences with bottled water, followed by water filters, and, pursuant to a settlement agreement with USEPA, it hooked them up to the public water system. Pursuant to an amendment of the settlement agreement, FWEC subsequently agreed with USEPA to arrange and pay for the hookup of several additional residences, even though TCE has not been detected in the wells at those residences. The hookups to the agreed upon residences have been completed, and USEPA has provided FWEC with a certificate that FWEC has completed its obligations related to the above-described settlement agreement (as amended). FWEC may be required to pay the agencies’ costs in overseeing and responding to the situation.

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FWEC is also incurring further costs in connection with a Remedial Investigation / Feasibility Study (“RI/FS”) that in March 2009 it agreed to conduct. During the fourth quarter of 2012, FWEC received a USEPA demand under the foregoing agreement for payment of $1,040 of response costs USEPA claims it incurred from the commencement of the RI/FS in April 2009 through February 2012. FWEC questioned the amount of the invoice and based upon discussions with the USEPA, a revised invoice was received on June 17, 2013 for the reduced amount of $1,004. During the third quarter of 2013, FWEC received a USEPA invoice under the foregoing agreement for payment of $258 of response costs USEPA claims it incurred from March 2012 to February 2013. In April 2009, USEPA proposed for listing on the National Priorities List (“NPL”) an area consisting of FWEC’s former manufacturing facility and the affected residences, but it also stated that the proposed listing may not be finalized if FWEC complies with its agreement to conduct the RI/FS. FWEC submitted comments opposing the proposed listing.

FWEC has accrued its best estimate of the cost of all of the foregoing, and it reviews this estimate on a quarterly basis.

Other costs to which FWEC could be exposed could include, among other things, FWEC’s counsel and consulting fees, further agency oversight and/or response costs, costs and/or exposure related to potential litigation, and other costs related to possible further investigation and/or remediation. At present, it is not possible to determine whether FWEC will be determined to be liable for some or all of the items described in this paragraph or to reliably estimate the potential liability associated with the items. If one or more third-parties are determined to be a source of the TCE, FWEC will evaluate its options regarding the potential recovery of the costs FWEC has incurred, which options could include seeking to recover those costs from those determined to be a source.

Other Environmental Matters

Our operations, especially our manufacturing and power plants, are subject to comprehensive laws adopted for the protection of the environment and to regulate land use. The laws of primary relevance to our operations regulate the discharge of emissions into the water and air, but can also include hazardous materials handling and disposal, waste disposal and other types of environmental regulation. These laws and regulations in many cases require a lengthy and complex process of obtaining licenses, permits and approvals from the applicable regulatory agencies. Noncompliance with these laws can result in the imposition of material civil or criminal fines or penalties. We believe that we are in substantial compliance with existing environmental laws. However, no assurance can be provided that we will not become the subject of enforcement proceedings that could cause us to incur material expenditures. Further, no assurance can be provided that we will not need to incur material expenditures beyond our existing reserves to make capital improvements or operational changes necessary to allow us to comply with future environmental laws.

13. Discontinued Operations

During the first quarter of 2013, we recorded an impairment charge of $3,919 at our waste-to-energy facility in Camden, New Jersey within our Global Power Group business segment. This charge was in addition to an impairment charge of $11,455 recorded during the fourth quarter of 2012. The impairment charges in both periods included estimates related to the continued operation of the facility and potential sale of the facility. The charge in the first quarter of 2013 was the result of updating our estimate related to the potential sale of the facility and the impairment charge was recorded within income from discontinued operations on our consolidated statement of operations. After recording the impairment charge and after approval of the plan to sell the facility, discussed below, the carrying value of the facility’s fixed assets approximated fair value less estimated costs to sell the facility.

On April 17, 2013, our Board of Directors approved a plan to sell our Camden facility and we completed the sale of the facility in August 2013. The presentation of the financial results and asset and liability balances of this business for the periods prior to the completion of the sale have been reclassified on our consolidated statement of operations, consolidated balance sheet and consolidated statement of cash flows under the respective captions related to discontinued operations, and these reclassifications have been made in the notes to our consolidated financial statements. Prior to the sale, the business had been classified on our consolidated balance sheet as of June 30, 2013 under the respective current and non-current captions of assets held for sale and liabilities held for sale as a result of our Board of Directors’ approval of our plan to sell the facility, which met the accounting criteria as a business held for sale and the criteria for classification as a discontinued operation. We did not recognize depreciation on long-lived assets while held for sale. Our Camden facility was formerly included in our Global Power Group business segment.

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We completed the sale of our Camden facility in August 2013. Based on the proceeds received and costs of disposal, we recognized a gain of $300 within income/(loss) from discontinued operations before income taxes on the consolidated statement of operations during the quarter and nine months ended September 30, 2013.

The following are the main classes of assets and liabilities that were associated with our discontinued operations as of December 31, 2012:

	December 31, 2012
Assets:
Trade accounts and notes receivable, net	$	1,482
Other current assets		23
Current assets of discontinued operations		1,505
Land, buildings and equipment, net		48,739
Restricted cash		840
Long-term assets of discontinued operations	$	49,579
Liabilities:
Accounts payable	$	1,814
Accrued expenses		595
Advance payments		745
Liabilities of discontinued operations	$	3,154

Operating revenues related to our discontinued operations, which were exclusively in the U.S., were $3,991 and $5,936 during the third quarter of 2013 and 2012, respectively, and $17,053 and $18,006 during the nine months ended September 30, 2013 and 2012, respectively.

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ITEM 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

(amounts in thousands of dollars, except share data and per share amounts)

The following is management’s discussion and analysis of certain significant factors that have affected our financial condition and results of operations for the periods indicated below. This discussion and analysis should be read in conjunction with our consolidated financial statements and notes thereto included in this quarterly report on Form 10-Q and our annual report on Form 10-K for the year ended December 31, 2012, which we refer to as our 2012 Form 10-K.

Safe Harbor Statement

This management’s discussion and analysis of financial condition and results of operations, other sections of this quarterly report on Form 10-Q and other reports and oral statements made by our representatives from time to time may contain forward-looking statements that are based on our assumptions, expectations and projections about Foster Wheeler AG and the various industries within which we operate. These include statements regarding our expectations about revenues (including as expressed by our backlog), our liquidity, the outcome of litigation and legal proceedings and recoveries from customers for claims, and the costs of current and future asbestos claims and the amount and timing of related insurance recoveries. Such forward-looking statements by their nature involve a degree of risk and uncertainty. We caution that a variety of factors, including but not limited to the factors described in Part I, Item 1A, “Risk Factors,” in our 2012 Form 10-K, which we filed with the Securities and Exchange Commission, or SEC, on March 1, 2013, the factors described in Part II, Item 1A, “Risk Factors,” in our quarterly report on Form 10-Q for the quarter ended March 31, 2013, and the following, could cause business conditions and our results to differ materially from what is contained in forward-looking statements:

• benefits, effects or results of our redomestication to Switzerland;

• benefits, effects or results of our strategic renewal initiative;

• further deterioration in global economic conditions;

• changes in investment by the oil and gas, oil refining, chemical/petrochemical and power generation industries;

• changes in the financial condition of our customers;

• changes in regulatory environments;

• changes in project design or schedules;

• contract cancellations;

• changes in our estimates of costs to complete projects;

• changes in trade, monetary and fiscal policies worldwide;

• compliance with laws and regulations relating to our global operations;

• currency fluctuations;

• war, terrorist attacks and/or natural disasters affecting facilities either owned by us or where equipment or services are or may be provided by us;

• interruptions to shipping lanes or other methods of transit;

• outcomes of pending and future litigation, including litigation regarding our liability for damages and insurance coverage for asbestos exposure;

• protection and validity of our patents and other intellectual property rights;

• increasing global competition;

• compliance with our debt covenants;

• recoverability of claims against our customers and others by us and claims by third parties against us; and

• changes in estimates used in our critical accounting policies.

Other factors and assumptions not identified above were also involved in the formation of these forward-looking statements and the failure of such other assumptions to be realized, as well as other factors, may also cause actual results to differ materially from those projected. Most of these factors are difficult to predict accurately and are generally beyond our control. You should consider the areas of risk described above in connection with any forward-looking statements that may be made by us.

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In addition, this management’s discussion and analysis of financial condition and results of operations contains several statements regarding current and future general global economic conditions. These statements are based on our compilation of economic data and analyses from a variety of external sources. While we believe these statements to be reasonably accurate, global economic conditions are difficult to analyze and predict and are subject to significant uncertainty and as a result, these statements may prove to be wrong. The challenges and drivers for each of our business segments are discussed in more detail in the section entitled “—Results of Operations-Continuing Operations-Business Segments,” within this Item 2.

We undertake no obligation to publicly update any forward-looking statements, whether as a result of new information, future events or otherwise. You are advised, however, to consult any additional disclosures we make in proxy statements, quarterly reports on Form 10-Q, annual reports on Form 10-K and current reports on Form 8-K filed or furnished with the SEC.

Overview

We operate through two business groups – the Global Engineering & Construction Group, which we refer to as our Global E&C Group, and our Global Power Group. In addition to these two business groups, we also report corporate center expenses, our captive insurance operation and expenses related to certain legacy liabilities, such as asbestos and other expenses, in the Corporate and Finance Group, which we refer to as our C&F Group.

We have been exploring, and intend to continue to explore, acquisitions within the engineering and construction industry to strategically complement or expand on our Global E&C Group’s technical capabilities or access to new market segments. During the second quarter of 2013, we acquired an upstream consultancy business located in the United Kingdom that specializes in field development and project decision support, focused on the evaluation and implementation of oil and gas field developments covering greenfield and brownfield assets. Also during the second quarter of 2013, we acquired an engineering and project management business located in Mexico with experience in both offshore and onshore upstream oil and gas downstream oil and gas and power projects. Additionally, during the first quarter of 2013, we acquired a U.S.-based business that specializes in the management of construction and commissioning of pharmaceutical and biotech facilities and which also has the capabilities to manage the full engineering, procurement and construction of such facilities. In addition, in the fourth quarter of 2012, we acquired all of the outstanding shares of a privately held multi-discipline full service engineering, procurement, and construction management business located in North America. The results of operations of these acquired businesses have been included in our Global E&C Group. We are also exploring acquisitions within the power generation industry to complement the products which our Global Power Group offers. There is no assurance that we will consummate any acquisitions in the future. Please refer to Note 2 to the consolidated financial statements in this quarterly report on Form 10-Q for further information regarding our acquisition activities in 2013 and 2012.

The above acquisitions have been included in our consolidated financial results as of their respective acquisition dates and all of the acquisitions are included in our results of operation for the quarter and nine months ended September 30, 2013. Throughout this Item 2, where period-to-period financial results have been impacted by these acquisitions, particularly our acquisitions in the fourth quarter of 2012 and the first quarter of 2013, we have referred to these acquisitions as either “businesses acquired subsequent to the quarter ended September 30, 2012,” “businesses acquired subsequent to the nine months ended September 30, 2012” or “businesses acquired subsequent to the quarter and nine months ended September 30, 2012.”

On April 17, 2013, our Board of Directors approved a plan to sell our waste-to-energy facility in Camden, New Jersey and we completed the sale of the facility in August 2013. The presentation of the financial results and asset and liability balances of this business for the periods prior to the completion of the sale have been reclassified on our consolidated statement of operations, consolidated balance sheet and consolidated statement of cash flows under the respective captions related to discontinued operations. These reclassifications have also been made in the notes to our consolidated financial statements and in this Management’s Discussion and Analysis of Financial Condition and Results of Operations section. Prior to the sale, the business had been classified on our consolidated balance sheet as of June 30, 2013 under the respective current and non-current captions of assets held for sale and liabilities held for sale as a result of our Board of Directors’ approval of our plan to sell the facility, which met the accounting criteria as a business held for sale and the criteria for classification as a discontinued operation. We did not recognize depreciation on long-lived assets while held for sale. Our Camden facility was formerly included in our Global Power Group business segment.

We completed the sale of our Camden facility in August 2013. Based on the proceeds received and costs of disposal, we recognized a gain of $300 within income/(loss) from discontinued operations before income taxes on the consolidated statement of operations during the quarter and nine months ended September 30, 2013. Please refer to Note 13 to the consolidated financial statements in this quarterly report on Form 10-Q for further information regarding our discontinued operations.

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Summary Financial Results for the Quarter and Nine Months Ended September 30, 2013

Continuing Operations

Our summary financial results for the quarters and nine months ended September 30, 2013 and 2012 from continuing operations are as follows:

	Quarter Ended September 30,				Nine Months Ended September 30,
	2013		2012		2013		2012
Consolidated Statement of Operations:
Operating revenues(1)	$	801,826	$	797,296	$	2,455,377	$	2,661,348
Contract profit(1)		153,466		154,220		426,519		433,236
Selling, general and administrative expenses(1)		85,521		77,495		265,654		245,925
Income from continuing operations attributable to Foster Wheeler AG	$	48,853	$	58,667	$	134,073	$	130,578
Earnings per share:
Basic	$	0.50	$	0.55	$	1.33	$	1.22
Diluted	$	0.50	$	0.55	$	1.32	$	1.21
Net cash provided by operating activities(2)					$	114,082	$	109,674

⁽¹⁾  Please refer to the section entitled “—Results of Operations-Continuing Operations” within this Item 2 for further discussion.

⁽²⁾  Please refer to the section entitled “—Liquidity and Capital Resources” within this Item 2 for further discussion.

Cash and cash equivalents totaled $497,129 and $582,322 as of September 30, 2013 and December 31, 2012, respectively.

EBITDA, as discussed and defined within the section entitled “—Results of Operations–Continuing Operations-EBITDA” within this Item 2, is used to measure the operating performance of our operating groups and is referred to below in our discussion of income from continuing operations attributable to Foster Wheeler AG.

Income from continuing operations attributable to Foster Wheeler AG decreased in the third quarter of 2013, compared to the same period of 2012. Our Global Power Group experienced a decrease in EBITDA of $19,000 during the third quarter of 2013, compared to the same period of 2012, whereas our Global E&C Group experienced an increase in EBITDA of $8,000 when comparing the same two periods. Additionally, our results in the third quarter of 2013 were unfavorably impacted by a higher effective tax rate of 26.9%, compared to an effective tax rate of 21.1% during the same period in 2012.

Income from continuing operations attributable to Foster Wheeler AG increased in the first nine months of 2013, compared to the same period of 2012. This increase was the net result of the favorable pre-tax impact of an asbestos-related insurance recovery gain of $15,800 and the favorable impact on our results of a lower effective tax rate during the first nine months of 2013 of 20.8%, compared to an effective tax rate of 23.7% during the same period in 2012, partially offset by the pre-tax impact of a net decrease in EBITDA of $24,300 from our operating groups. Our Global Power Group experienced a decrease in EBITDA of $42,800 during the first nine months of 2013, compared to the same period of 2012, whereas our Global E&C Group experienced an increase in EBITDA of $18,500 when comparing the same two periods.

Please refer to the section entitled “—Results of Operations-Continuing Operations-Business Segments,” within this Item 2, for further discussion related to EBITDA results for both of our operating groups.

Discontinued Operations

Income from discontinued operations attributable to Foster Wheeler AG increased $2,200 in the third quarter of 2013, compared to the same period in 2012. This increase includes the favorable impact related to decreased depreciation of $1,200, which was the result of not recognizing depreciation expense on our Camden facility as the business met the accounting criteria as a business held for sale for the period prior to its sale during third quarter of 2013, as discussed above, and the gain on the sale of the business of $300 during the third quarter of 2013.

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Income from discontinued operations attributable to Foster Wheeler AG increased $1,100 during the first nine months of 2013, compared to the same period in 2012, primarily as a net result of the favorable impact related to decreased depreciation of $3,600 in the first nine months of 2013, which was the result of not recognizing depreciation expense on our Camden facility once the business met the accounting criteria as a business held for sale for the period prior to its sale during the first nine months of 2013, as discussed above, the favorable impact related to the inclusion of increased costs of $800 due to an extended outage and maintenance-related costs during the first quarter of 2012 and the gain on the sale of the business of $300 during the first nine months of 2013, partially offset by an impairment charge of $3,900 recognized in the first quarter of 2013.

Please refer to Note 13 to the consolidated financial statements in this quarterly report on Form 10-Q for further information regarding our discontinued operations.

New Orders and Backlog of Unfilled Orders

The tables below summarize our new orders and backlog of unfilled orders by period and include balances for discontinued operations for periods prior to the quarter ended September 30, 2013, which were insignificant based on our consolidated and business group balances:

	Quarter Ended
	September 30, 2013		June 30, 2013		September 30, 2012
New orders, measured in future revenues:
Global E&C Group*	$	1,498,400	$	661,000	$	838,000
Global Power Group		177,900		90,300		185,900
Total*	$	1,676,300	$	751,300	$	1,023,900

* Amounts for the Global E&C Group include flow-through revenues, as defined in the section entitled —“Results of Operations-Continuing Operations-Operating Revenues” within this Item 2, of $194,600, $124,000, and $69,400 for the quarters ended September 30, 2013, June 30, 2013 and September 30, 2012, respectively.

	As of
	September 30, 2013		June 30, 2013		December 31, 2012
Backlog of unfilled orders, measured in future revenues	$	3,942,200	$	3,281,200	$	3,648,000
Backlog, measured in Foster Wheeler scope*	$	3,502,700	$	2,706,300	$	2,950,200
Global E&C Group man-hours in backlog (in thousands)		20,900		17,600		17,000

* As defined in the section entitled “—Backlog and New Orders” within this Item 2.

Please refer to the section entitled “— New Orders and Backlog” within this Item 2 for further detail.

Challenges and Drivers

Our primary operating focus continues to be booking quality new business and effectively and efficiently executing our contracts. The global markets in which we operate are largely dependent on overall economic conditions and global or regional economic growth rates and the resultant demand for oil and gas, electric power, petrochemicals, refined products and minerals and metals. Both of our business groups have been impacted by unfavorable economic growth rates in most of their respective global markets in recent years. Additionally, there is potential downside risk to continued unfavorable global economic growth rates driven primarily by continued sovereign debt and bank funding pressures and continued recession in 2013 in the Eurozone, the speed and effectiveness of the implementation of government macroeconomic policies in a number of key advanced and emerging economies, slower growth than anticipated in emerging economies, most significantly The People’s Republic of China, or China, and geopolitical oil supply risks, particularly in the Middle East, which could impact global economic growth through a significant rise in oil prices. If any of these risks materialize, the ability of both of our business groups to book work could be negatively impacted, which could have a material negative impact on our business.

In the engineering and construction industry, we expect long-term demand to be strong for the end products produced by our clients, and we believe that this long-term demand will continue to stimulate investment by our clients in new, expanded and upgraded facilities. Our clients plan their investments based on long-term time horizons. We believe that global demand for energy, chemicals, minerals and pharmaceuticals will continue to grow over the long-term and that clients will continue to invest in new and upgraded capacity to meet that demand. Global markets in the engineering and construction industry are experiencing intense competition among engineering and construction contractors and pricing pressure for contracts awarded. Clients’ bidding and contract award processes continue to be protracted and some clients have been releasing, and we expect will continue to release, tranches of work on a piecemeal basis. However, we are seeing clients continuing to develop new projects

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and, after making final investment decisions, moving forward with previously planned projects. This includes a much stronger pipeline of projects in North America both in chemicals and natural gas liquefaction, or LNG, due to the availability of cheap gas supply from shale gas. The challenges and drivers for our Global E&C Group are discussed in more detail in the section entitled “—Results of Operations-Continuing Operations-Business Segments-Global E&C Group-Overview of Segment,” within this Item 2.

Global gross domestic product, or GDP, growth is a key driver of demand for power. The slow economic growth in recent years has negatively impacted the demand for our products and services. However, we believe that a gradual upturn in global economic growth will begin as we progress through 2014, which we further believe will improve demand for the products and services of our Global Power Group, compared to 2012. However, a number of constraining market factors continues to impact the markets that we serve. These factors include political and environmental sensitivity regarding coal-fired steam generators in certain geographies and the outlook for continued lower natural gas pricing over the next three to five years, which has increased the attractiveness of natural gas, in relation to coal and renewables, for the generation of electricity. In addition, the constraints on the global credit market may continue to impact some of our clients’ investment plans as these clients are affected by the availability and cost of financing, as well as their own financial strategies, which could include cash conservation. These factors may continue in the future. The challenges and drivers for our Global Power Group are discussed in more detail in the section entitled “—Results of Operations-Continuing Operations-Business Segments-Global Power Group-Overview of Segment,” within this Item 2.

Results of Operations – Continuing Operations

The following sections provide a discussion of our results of operations from our continuing operations.

Operating Revenues

Our operating revenues by geographic region, based upon where our projects are being executed, for the quarters and nine months ended September 30, 2013 and 2012, were as follows:

	Quarter Ended September 30,										Nine Months Ended September 30,
	2013		2012		$ Change			% Change			2013		2012		$ Change			% Change
Africa	$	12,694	$	22,475	$	(9,781	)		(43.5	)%	$	52,341	$	70,136	$	(17,795	)		(25.4	)%
Asia Pacific		208,073		231,267		(23,194	)		(10.0	)%		612,348		947,867		(335,519	)		(35.4	)%
Europe		192,318		189,003		3,315			1.8	%		596,154		647,935		(51,781	)		(8.0	)%
Middle East		91,482		65,166		26,316			40.4	%		236,284		178,015		58,269			32.7	%
North America		205,570		211,711		(6,141	)		(2.9	)%		729,583		572,826		156,757			27.4	%
South America		91,689		77,674		14,015			18.0	%		228,667		244,569		(15,902	)		(6.5	)%
Total	$	801,826	$	797,296	$	4,530			0.6	%	$	2,455,377	$	2,661,348	$	(205,971	)		(7.7	)%

We operate through two business groups: our Global E&C Group and our Global Power Group. The composition of our operating revenues varies from period to period based on the portfolio of contracts in execution during any given period. Our operating revenues are further dependent upon the strength of the various geographic markets and industries we serve and our ability to address those markets and industries. Please refer to the section entitled “—Business Segments,” within this Item 2, for a discussion of the products and services, geographic markets and industries of our business groups.

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Our operating revenues for each of our business groups for the quarters and nine months ended September 30, 2013 and 2012, were as follows:

	September 30, 2013		September 30, 2012		$ Change			% Change
Quarter Ended:
Global E&C Group	$	615,028	$	578,072	$	36,956			6.4	%
Global Power Group		186,798		219,224		(32,426	)		(14.8	)%
Total	$	801,826	$	797,296	$	4,530			0.6	%
Nine Months Ended:
Global E&C Group	$	1,865,721	$	1,915,087	$	(49,366	)		(2.6	)%
Global Power Group		589,656		746,261		(156,605	)		(21.0	)%
Total	$	2,455,377	$	2,661,348	$	(205,971	)		(7.7	)%

Our operating revenues increased in the quarter ended September 30, 2013, compared to the same period in 2012, which included the impact of decreased flow-through revenues of $23,400, as described below. Excluding the impact of the change in flow-through revenues and currency impacts, our operating revenues during the quarter ended September 30, 2013 increased 4%, compared to the same period in 2012. The increase in operating revenues, excluding flow-through revenues, in the quarter ended September 30, 2013 was the result of increased operating revenues in our Global E&C Group, partially offset by decreased operating revenues in our Global Power Group. The operating revenues increase in our Global E&C Group included the favorable impact in 2013 related to the businesses acquired subsequent to the quarter ended September 30, 2012.

Our operating revenues decreased in the nine months ended September 30, 2013, compared to the same period in 2012, which included the impact of decreased flow-through revenues of $195,500, as described below. Excluding the impact of the change in flow-through revenues and currency impacts, our operating revenues during the nine months ended September 30, 2013 decreased 1%, compared to the same period in 2012. The decrease in operating revenues in the nine months ended September 30, 2013 was the result of decreased operating revenues in our Global Power Group, partially offset by increased operating revenues, excluding flow-through revenues, in our Global E&C Group. The operating revenues increase in our Global E&C Group included the favorable impact in 2013 related to the businesses acquired subsequent to the nine months ended September 30, 2012.

Flow-through revenues and costs result when we purchase materials, equipment or third-party services on behalf of our customer on a reimbursable basis with no profit on the materials, equipment or third-party services and where we have the overall responsibility as the contractor for the engineering specifications and procurement or procurement services for the materials, equipment or third-party services included in flow-through costs. Flow-through revenues and costs do not impact contract profit or net earnings.

Please refer to the section entitled “—Business Segments,” within this Item 2, for further discussion related to operating revenues and our view of the market outlook for both of our operating groups.

Contract Profit

	September 30, 2013		September 30, 2012		$ Change			% Change
Quarter Ended	$	153,466	$	154,220	$	(754	)		(0.5	)%
Nine Months Ended	$	426,519	$	433,236	$	(6,717	)		(1.6	)%

Contract profit is computed as operating revenues less cost of operating revenues. “Flow-through” amounts are recorded both as operating revenues and cost of operating revenues with no contract profit. Contract profit margins are computed as contract profit divided by operating revenues. Flow-through revenues reduce the contract profit margin as they are included in operating revenues without any corresponding impact on contract profit. As a result, we analyze our contract profit margins excluding the impact of flow-through revenues as we believe that this is a more accurate measure of our operating performance.

Contract profit was relatively flat during the quarter ended September 30, 2013, compared to the same period in 2012, which was the net result of increased contract profit by our Global E&C Group, partially offset by decreased contract profit by our Global Power Group. The increase in contract profit in our Global E&C Group included the favorable impact related to the businesses acquired subsequent to the quarter ended September 30, 2012.

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Contract profit decreased during the nine months ended September 30, 2013, compared to the same period in 2012. The decrease was the result of decreased contract profit by our Global Power Group, partially offset by increased contract profit by our Global E&C Group. The increase in contract profit in our Global E&C Group included the favorable impact related to the businesses acquired subsequent to the nine months ended September 30, 2012.

Please refer to the section entitled “—Business Segments,” within this Item 2, for further information related to contract profit for both of our operating groups.

Selling, General and Administrative (SG&A) Expenses

	September 30, 2013		September 30, 2012		$ Change		% Change
Quarter Ended	$	85,521	$	77,495	$	8,026		10.4	%
Nine Months Ended	$	265,654	$	245,925	$	19,729		8.0	%

SG&A expenses include the costs associated with general management, sales pursuit, including proposal expenses, and research and development costs.

SG&A expenses increased in the third quarter of 2013, compared to the same period in 2012, primarily as a result of the aggregate impact of the businesses acquired subsequent to the quarter ended September 30, 2012. The impact of the acquired businesses increased our SG&A expenses by $4,200, much of which was attributable to compensation expense recognized under earnout provisions associated with the acquisitions. The increase in SG&A expenses also included a charge for severance-related postemployment benefits of $2,200 recognized in the third quarter of 2013 in our Global Power Group.

SG&A expenses increased in the first nine months of 2013, compared to the same period in 2012, primarily as a result of the aggregate impact of the businesses acquired subsequent to the nine months ended September 30, 2012. The impact of the acquired businesses increased our SG&A expenses by $10,000, much of which was attributable to compensation expense recognized under earnout provisions associated with the acquisitions. The increase in SG&A expenses also included a charge for severance-related postemployment benefits of $4,700 recognized in the first nine months of 2013 and increased sales pursuit costs of $3,200. During the first nine months of 2013, our SG&A expenses included severance-related postemployment benefits charges of $2,400 in our Global Power Group, $1,900 in our Global E&C Group and $400 in our C&F Group.

Other Income, net

	September 30, 2013		September 30, 2012		$ Change			% Change
Quarter Ended	$	9,873	$	14,342	$	(4,469	)		(31.2	)%
Nine Months Ended	$	32,638	$	32,995	$	(357	)		(1.1	)%

Other income, net during the quarter and nine months ended September 30, 2013 consisted primarily of equity earnings of $6,700 and $27,200, respectively. Our equity earnings were primarily generated from our ownership interests in build, own and operate projects in Chile and Italy. Our equity earnings from our Global Power Group’s project in Chile during the quarter and nine months ended September 30, 2013 were $5,400 and $22,500, respectively, while equity earnings from our Global E&C Group’s projects in Italy were $1,500 and $4,900, respectively.

Other income, net decreased in the third quarter of 2013, compared to the same period in 2012, primarily driven by the unfavorable impact of the inclusion of a gain recognized during the third quarter of 2012 related to a favorable settlement of our claim with a client on a legacy project of $2,000 and decreased governmental economic subsidies and other non-income tax credits of $1,500.

Other income, net was relatively unchanged in the first nine months of 2013, compared to the same period in 2012. This was primarily the net result of the unfavorable impact of the inclusion of a gain recognized during the first nine months of 2012 related to a favorable settlement of our claim with a client on a legacy project of $2,000 and decreased governmental economic subsidies and other non-income tax credits of $1,500, offset by increased equity earnings from our Global Power Group’s project in Chile of $3,800.

For further information related to our equity earnings, please refer to the sections within this Item 2 entitled “—Business Segments-Global Power Group” for our Global Power Group’s project in Chile and “—Business Segments-Global E&C Group” for our Global E&C Group’s projects in Italy, as well as Note 3 to the consolidated financial statements included in this quarterly report on Form 10-Q.

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Other Deductions, net

	September 30, 2013		September 30, 2012		$ Change			% Change
Quarter Ended	$	7,557	$	8,825	$	(1,268	)		(14.4	)%
Nine Months Ended	$	23,359	$	25,062	$	(1,703	)		(6.8	)%

Other deductions, net includes various items, such as legal fees, consulting fees, bank fees, net penalties on unrecognized tax benefits and the impact of net foreign exchange transactions within the period. Net foreign exchange transactions include the net amount of transaction losses and gains that arise from exchange rate fluctuations on transactions denominated in a currency other than the functional currency of our subsidiaries.

Other deductions, net in the third quarter of 2013 consisted primarily of legal fees of $5,400, bank fees of $1,000 and net penalties on unrecognized tax benefits of $600. Other deductions, net decreased in the third quarter of 2013, compared to the same period in 2012. This decrease was primarily the net result of a decrease in the provision for dispute resolution and environmental remediation costs of $900, the favorable impact resulting from the inclusion of a $800 charge recognized in the third quarter of 2012 for unamortized fees and expenses related to the termination of our July 2010 senior credit agreement upon entering into a new senior credit agreement in August 2012 and the favorable impact of a change in net foreign currency exchange transactions of $400, partially offset by increased legal fees of $1,400.

Other deductions, net in the first nine months of 2013 consisted primarily of legal fees of $15,900, bank fees of $3,100 and the provision for dispute resolution and environmental remediation costs of $1,300. The decrease in other deductions, net in the first nine months of 2013, compared to the same period in 2012, was primarily the net result of decreased net penalties on unrecognized tax benefits of $3,100, which included the net benefit of previously accrued tax penalties on unrecognized tax benefits that were ultimately not assessed during the first nine months of 2013 of $1,400, the favorable impact resulting from the inclusion of a $1,500 charge recognized by our Global E&C Group in the first nine months of 2012 related to the write-off of capitalized costs for a wind farm development project, the favorable impact resulting from the inclusion of a $800 charge recognized in the first nine months of 2012 for unamortized fees and expenses related to the termination of our July 2010 senior credit agreement, as further described above, and a decrease in the provision for dispute resolution and environmental remediation costs of $600, partially offset by increased legal fees of $4,600.

Net foreign currency exchange transaction gains and losses were primarily driven by exchange rate fluctuations on cash balances held by certain of our subsidiaries that were denominated in a currency other than the functional currency of those subsidiaries.

Interest Income

	September 30, 2013		September 30, 2012		$ Change			% Change
Quarter Ended	$	1,307	$	2,469	$	(1,162	)		(47.1	)%
Nine Months Ended	$	4,251	$	8,583	$	(4,332	)		(50.5	)%

Interest income decreased in the quarter and nine months ended September 30, 2013, compared to the same periods in 2012, primarily as a result of lower average cash and cash equivalents balances and, to a lesser extent, lower investment yields on cash and cash equivalents balances.

Interest Expense

	September 30, 2013		September 30, 2012		$ Change			% Change
Quarter Ended	$	3,388	$	3,197	$	191			6.0	%
Nine Months Ended	$	9,976	$	10,862	$	(886	)		(8.2	)%

Interest expense increased in the third quarter of 2013, compared to the same period in 2012, which was primarily the result of increased interest expense on valued added tax and payroll liabilities of $400 in the third quarter of 2013.

Interest expense decreased in the nine months ended September 30, 2013, compared to the same period in 2012, which was the net result of decreased net interest expense on unrecognized tax benefits of $1,200 and the favorable impact from decreased average borrowings, excluding foreign currency translation effects, partially offset by increased interest expense on valued added tax and payroll liabilities of $800 in the nine months ended September 30, 2013.

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Net Asbestos-Related Provision/(Gain)

	September 30, 2013			September 30, 2012		$ Change			% Change
Quarter Ended	$	2,000		$	2,000	$	—			0.0	%
Nine Months Ended	$	(9,750	)	$	7,710	$	(17,460	)		(226.5	)%

The net asbestos-related provision was unchanged during the third quarter of 2013, compared to the same period in 2012.

The decrease in the net asbestos-related provision in the nine months ended September 30, 2013, compared to the same period in 2012, was primarily the result of the favorable impact of the inclusion of an insurance recovery gain recognized during the nine months ended September 30, 2013 upon collection of a $15,800 insurance receivable related to an insolvent insurance carrier, which we had previously written-off. Please refer to Note 12 to the consolidated financial statements included in this quarterly report on Form 10-Q for additional information.

Provision for Income Taxes

	September 30, 2013			September 30, 2012			$ Change			% Change
Quarter Ended	$	17,794		$	16,790		$	1,004			6.0	%
Effective tax rate		26.9	%		21.1	%
Nine Months Ended	$	36,273		$	43,965		$	(7,692	)		(17.5	)%
Effective tax rate		20.8	%		23.7	%

Although we are a Swiss corporation, our shares are listed on a U.S. exchange; therefore, we reconcile our effective tax rate to the U.S. federal statutory rate of 35% to facilitate meaningful comparison with peer companies in the U.S. capital markets. Our effective tax rate can fluctuate significantly from period to period and may differ considerably from the U.S. federal statutory rate as a result of (i) income taxed in various non-U.S. jurisdictions with rates different from the U.S. statutory rate, (ii) our inability to recognize a tax benefit for losses generated by certain unprofitable operations and (iii) the varying mix of income earned in the jurisdictions in which we operate. In addition, our deferred tax assets are reduced by a valuation allowance when, based upon available evidence, it is more likely than not that the tax benefit of loss carryforwards (or other deferred tax assets) will not be realized in the future. In periods when operating units subject to a valuation allowance generate pre-tax earnings, the corresponding reduction in the valuation allowance favorably impacts our effective tax rate. Conversely, in periods when operating units subject to a valuation allowance generate pre-tax losses, the corresponding increase in the valuation allowance has an unfavorable impact on our effective tax rate.

Effective Tax Rate for 2013

Our effective tax rate for the first nine months of 2013 was lower than the U.S. statutory rate of 35% due principally to the net impact of the following:

• Income earned in non-U.S. tax jurisdictions which contributed to an approximate 17-percentage point reduction in our effective tax rate, primarily because of tax rates lower than the U.S. statutory rate, as well as additional impacts from equity income of joint ventures, tax exemptions, incentives and credits, and other items;

• Discrete items, primarily relating to the reversal of a previously accrued liability for branch taxes no longer required to be paid as a result of an exemption received from a non-U.S. tax authority, which was partially offset by the impact of a change in tax rate on net deferred assets in a non-U.S. jurisdiction, provided a net one-percentage point reduction to the effective tax rate; and

• A valuation allowance increase because we are unable to recognize a tax benefit for year-to-date losses subject to a valuation allowance in certain jurisdictions (primarily in the U.S.), partially offset by valuation allowance releases in certain non-U.S. jurisdictions, which contributed to an approximate three-percentage point increase in our effective tax rate.

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Effective Tax Rate for 2012

Our effective tax rate for the first nine months of 2012 was lower than the U.S. statutory rate of 35% due principally to the net impact of the following:

• Income earned in non-U.S. tax jurisdictions which contributed to an approximate 15-percentage point reduction in our effective tax rate, primarily because of tax rates lower than the U.S. statutory rate, as well as additional impacts from equity income of joint ventures, tax incentives and credits, and other items; and

• A valuation allowance increase because we were unable to recognize a tax benefit for year-to-date losses subject to a valuation allowance in certain jurisdictions (primarily in the U.S.), which contributed to an approximate two-percentage point increase in our effective tax rate.

We monitor the jurisdictions for which valuation allowances against deferred tax assets were established in previous years, and we evaluate, on a quarterly basis, the need for the valuation allowances against deferred tax assets in those jurisdictions. Such evaluation includes a review of all available evidence, both positive and negative, in determining whether a valuation allowance is necessary.

The majority of the U.S. federal tax benefits, against which valuation allowances have been established, do not expire until 2026 and beyond, based on current tax laws.

Net (Loss)/Income Attributable to Noncontrolling Interests

	September 30, 2013			September 30, 2012		$ Change			% Change
Quarter Ended	$	(467	)	$	4,057	$	(4,524	)		(111.5	)%
Nine Months Ended	$	3,823		$	10,712	$	(6,889	)		(64.3	)%

Net (loss)/income attributable to noncontrolling interests represents third-party ownership interests in the net (loss)/income of our Global Power Group’s Martinez, California gas-fired cogeneration subsidiary and our manufacturing subsidiaries in Poland and China, as well as our Global E&C Group’s subsidiaries in Malaysia and South Africa. The change in net (loss)/income attributable to noncontrolling interests is based upon changes in the net (loss)/income of these subsidiaries and/or changes in the noncontrolling interests’ ownership interest in the subsidiaries.

Net (loss)/income attributable to noncontrolling interests decreased in the third quarter of 2013, compared to the same period in 2012, which was primarily the result of decreased net (loss)/income from our operations in Malaysia, which experienced a net loss in the third quarter of 2013, and Martinez, California.

Net income attributable to noncontrolling interests decreased in the first nine months of 2013, compared to the same period in 2012, which was primarily the net result of decreased net income from our operations in Malaysia, which experienced a net loss in the first nine months of 2013, Martinez, California and Poland, partially offset by increased net income from our operations in the China.

EBITDA

EBITDA, as discussed and defined below, is the primary measure of operating performance used by our chief operating decision maker.

In addition to our two business groups, which also represent operating segments for financial reporting purposes, we report the financial results associated with the management of entities which are not managed by one of our two business groups, which include corporate center expenses, our captive insurance operation and expenses related to certain legacy liabilities, such as asbestos, in our C&F Group, which also represents an operating segment for financial reporting purposes.

	September 30, 2013		September 30, 2012		$ Change			% Change
Quarter Ended	$	84,067	$	90,832	$	(6,765	)		(7.4	)%
Nine Months Ended	$	223,150	$	220,946	$	2,204			1.0	%

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EBITDA decreased in the third quarter of 2013, compared to the same period in 2012. Our Global Power Group experienced a decrease in EBITDA of $19,000 during the third quarter of 2013, compared to the same period of 2012, whereas our Global E&C Group experienced an increase in EBITDA of $8,000 when comparing the same two periods. The net decrease in EBITDA from our two business groups was offset by an increase in EBITDA in our C&F Group of $4,200, which includes decreased SG&A expenses and the favorable impact resulting from the inclusion of a charge recognized in the third quarter of 2012 for unamortized fees and expenses related to our prior senior credit agreement.

EBITDA increased in the first nine months of 2013, compared to the same period in 2012. Our Global E&C Group experienced an increase in EBITDA of $18,500 during the first nine months of 2013, compared to the same period of 2012, whereas our Global Power Group experienced a decrease in EBITDA of $42,800 when comparing the same two periods. The net decrease in EBITDA from our two business groups was offset by an increase in EBITDA in our C&F Group of $26,600, which included the favorable impact of an asbestos-related insurance recovery gain of $15,800 recognized in the first nine months of 2013, as well as decreased SG&A expenses and the favorable impact resulting from the inclusion of a charge recognized in the first nine months of 2012 for unamortized fees and expenses related to our prior senior credit agreement.

Please refer to the section below entitled “—Business Segments,” for further discussion related to EBITDA results for both of our operating groups.

EBITDA is a supplemental financial measure not defined in generally accepted accounting principles, or GAAP. We define EBITDA as income attributable to Foster Wheeler AG before interest expense, income taxes and depreciation and amortization. We have presented EBITDA because we believe it is an important supplemental measure of operating performance. Certain covenants under our senior unsecured credit agreement use EBITDA, as defined in such agreement, in the covenant calculations which is different than EBITDA as presented herein. We believe that the line item on the consolidated statement of operations entitled “net income attributable to Foster Wheeler AG” is the most directly comparable GAAP financial measure to EBITDA. Since EBITDA is not a measure of performance calculated in accordance with GAAP, it should not be considered in isolation of, or as a substitute for, net income attributable to Foster Wheeler AG as an indicator of operating performance or any other GAAP financial measure. EBITDA, as calculated by us, may not be comparable to similarly titled measures employed by other companies. In addition, this measure does not necessarily represent funds available for discretionary use and is not necessarily a measure of our ability to fund our cash needs. As EBITDA excludes certain financial information that is included in net income attributable to Foster Wheeler AG, users of this financial information should consider the type of events and transactions that are excluded. Our non-GAAP performance measure, EBITDA, has certain material limitations as follows:

• It does not include interest expense. Because we have borrowed money to finance some of our operations, interest is a necessary and ongoing part of our costs and has assisted us in generating revenue. Therefore, any measure that excludes interest expense has material limitations;

• It does not include taxes. Because the payment of taxes is a necessary and ongoing part of our operations, any measure that excludes taxes has material limitations; and

• It does not include depreciation and amortization. Because we must utilize property, plant and equipment and intangible assets in order to generate revenues in our operations, depreciation and amortization are necessary and ongoing costs of our operations. Therefore, any measure that excludes depreciation and amortization has material limitations.

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A reconciliation of EBITDA from continuing operations to net income attributable to Foster Wheeler AG is shown below.

	Quarter Ended September 30,						Nine Months Ended September 30,
	2013			2012			2013			2012
EBITDA from continuing operations:
Global E&C Group	$	59,940		$	51,964		$	157,261		$	138,809
Global Power Group		45,428			64,396			115,699			158,535
C&F Group*		(21,301	)		(25,528	)		(49,810	)		(76,398	)
EBITDA from continuing operations		84,067			90,832			223,150			220,946
Less: Interest expense		3,388			3,197			9,976			10,862
Less: Depreciation and amortization		14,032			12,178			42,828			35,541
Less: Provision for income taxes		17,794			16,790			36,273			43,965
Income from continuing operations attributable to Foster Wheeler AG		48,853			58,667			134,073			130,578
Income/(loss) from discontinued operations attributable to Foster Wheeler AG		1,760			(445	)		265			(851	)
Net income attributable to Foster Wheeler AG	$	50,613		$	58,222		$	134,338		$	129,727

* Includes general corporate income and expense, our captive insurance operation and the elimination of transactions and balances related to intercompany interest.

EBITDA in the above table includes the following:

	Quarter Ended September 30,				Nine Months Ended September 30,
	2013		2012		2013			2012
Net increase/(decrease) in contract profit from regular revaluation of final estimated contract profit revisions:(1)
Global E&C Group(2)	$	13,800	$	7,000	$	38,200		$	12,100
Global Power Group(3)		16,400		15,700		36,600			45,900
Total	$	30,200	$	22,700	$	74,800		$	58,000
Net asbestos-related provision/(gain):(4)
Global E&C Group	$	—	$	—	$	—		$	1,700
C&F Group		2,000		2,000		(9,800	)		6,000
Total	$	2,000	$	2,000	$	(9,800	)	$	7,700
Charges for severance-related postemployment benefits:
Global E&C Group	$	1,000	$	—	$	3,900		$	—
Global Power Group		3,000		—		4,100			—
C&F Group		—		—		400			—
Total	$	4,000	$	—	$	8,400		$	—

⁽¹⁾  Please refer to “Revenue Recognition on Long-Term Contracts” in Note 1 to the consolidated financial statements included in this quarterly report on Form 10-Q for further information regarding changes in our final estimated contract profit.

⁽²⁾  The changes in final estimated contract profit revisions for our Global E&C Group and our financial results did not include an increase in final estimated contract profit of approximately $5,300 during the quarter and nine months ended September 30, 2012. The correction was recorded in the quarter ended December 31, 2012 as it was not material to the financial results for the quarter and nine months ended September 30, 2012 (the periods in which it should have been recorded), nor was it material to the financial results for the year ended December 31, 2012.

⁽³⁾  The changes in final estimated contract profit revisions for our Global Power Group were increased during the nine months ended September 30, 2012 for a favorable settlement with a subcontractor of approximately $6,900.

⁽⁴⁾  Please refer to Note 12 to the consolidated financial statements included in this quarterly report on Form 10-Q for further information regarding the revaluation of our asbestos liability and related asset.

The accounting policies of our business segments are the same as those described in our summary of significant accounting policies as disclosed in our 2012 Form 10-K. The only significant intersegment transactions relate to interest on intercompany balances. We account for interest on those arrangements as if they were third-party transactions (i.e., at current market rates), and we include the elimination of that activity in the results of the C&F Group.

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Business Segments

Global E&C Group

	Quarter Ended September 30,									Nine Months Ended September 30,
	2013		2012		$ Change		% Change			2013		2012		$ Change			% Change
Operating revenues	$	615,028	$	578,072	$	36,956		6.4	%	$	1,865,721	$	1,915,087	$	(49,366	)		(2.6	)%
EBITDA	$	59,940	$	51,964	$	7,976		15.3	%	$	157,261	$	138,809	$	18,452			13.3	%

Results

Our Global E&C Group’s operating revenues by geographic region for the quarter and nine months ended September 30, 2013 and 2012, based upon where our projects are being executed, were as follows:

	Quarter Ended September 30,										Nine Months Ended September 30,
	2013		2012		$ Change			% Change			2013		2012		$ Change			% Change
Africa	$	12,639	$	22,475	$	(9,836	)		(43.8	)%	$	52,259	$	67,686	$	(15,427	)		(22.8	)%
Asia Pacific		115,028		132,021		(16,993	)		(12.9	)%		369,897		636,441		(266,544	)		(41.9	)%
Europe		130,874		140,215		(9,341	)		(6.7	)%		408,172		418,231		(10,059	)		(2.4	)%
Middle East		91,099		63,854		27,245			42.7	%		231,764		169,050		62,714			37.1	%
North America		180,860		149,886		30,974			20.7	%		592,512		403,003		189,509			47.0	%
South America		84,528		69,621		14,907			21.4	%		211,117		220,676		(9,559	)		(4.3	)%
Total	$	615,028	$	578,072	$	36,956			6.4	%	$	1,865,721	$	1,915,087	$	(49,366	)		(2.6	)%

Please refer to the “—Overview of Segment” section below for a discussion of our Global E&C Group’s market outlook.

Quarter Ended September 30, 2013

Our Global E&C Group experienced an increase in operating revenues of 6% in the third quarter of 2013, compared to the same period in 2012. This increase included decreased flow-through revenues of $23,200. Excluding flow-through revenues and currency impacts, our Global E&C Group’s operating revenues increased 18% in the third quarter of 2013, compared to the same period in 2012. This increase included the favorable impact of the businesses acquired subsequent to the third quarter of 2012.

Our Global E&C Group’s EBITDA increased in the third quarter of 2013, compared to the same period in 2012. This increase was primarily driven by an increase in contract profit of $10,700, which included the favorable impact of the businesses acquired subsequent to the third quarter of 2012. The contract profit increase was driven by increased volume of operating revenues, excluding flow-through revenues, partially offset by decreased contract profit margin. Our Global E&C Group’s increase in EBITDA was partially offset by the aggregate impact of the additional SG&A expenses related to the businesses acquired subsequent to the quarter ended September 30, 2012 of $4,200, much of which was attributable to compensation expense recognized under earnout provisions associated with the acquisitions.

Nine Months Ended September 30, 2013

Our Global E&C Group experienced a decrease in operating revenues of 3% in the first nine months of 2013, compared to the same period in 2012. This decrease included decreased flow-through revenues of $195,900. Excluding flow-through revenues and currency impacts, our Global E&C Group’s operating revenues increased 14% in the first nine months of 2013, compared to the same period in 2012. This increase included the favorable impact of the businesses acquired subsequent to the nine months ended September 30, 2012.

Our Global E&C Group’s EBITDA increased in the first nine months of 2013, compared to the same period in 2012. This increase was primarily driven by an increase in contract profit of $22,300, which included the favorable impact of the businesses acquired subsequent to the first nine months of 2012. The contract profit increase was driven by increased volume of operating revenues, excluding flow-through revenues, partially offset by decreased contract profit margin. Our Global E&C Group’s increase in EBITDA was partially offset by the aggregate impact of the additional SG&A expenses related to the businesses acquired subsequent to the nine months ended September 30,

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2012 of $10,000, much of which was attributable to compensation expense recognized under earnout provisions associated with the acquisitions. The increase in EBITDA also included the favorable impact resulting from the inclusion of a $1,500 charge recognized in the second quarter of 2012 related to the write-off of capitalized costs for a wind farm development project that, due to legislation introduced in 2012, was no longer an economically viable project.

Overview of Segment

Our Global E&C Group, which operates worldwide, designs, engineers and constructs onshore and offshore upstream oil and gas processing facilities, LNG facilities and receiving terminals, gas-to-liquids facilities, oil refining, chemical and petrochemical, pharmaceutical and biotechnology facilities and related infrastructure, including power generation facilities, distribution facilities, gasification facilities and processing facilities associated with the minerals and metals sector. Our Global E&C Group is also involved in the design of facilities in developing market sectors, including carbon capture and storage, solid fuel-fired integrated gasification combined-cycle power plants, coal-to-liquids, coal-to-chemicals and biofuels. Additionally, our Global E&C Group is involved in the development, engineering, construction, ownership and operation of power generation facilities, from conventional and renewable sources, and of waste-to-energy facilities.

Our Global E&C Group provides the following services:

• Design, engineering, project management, construction and construction management services, including the procurement of equipment, materials and services from third-party suppliers and contractors;

• Environmental remediation services, together with related technical, engineering, design and regulatory services; and

• Design and supply of direct-fired furnaces, including fired heaters and waste heat recovery generators, used in a range of refinery, chemical, petrochemical, oil and gas processes, including furnaces used in our proprietary delayed coking and hydrogen production technologies.

Our Global E&C Group owns one of the leading technologies (SYDEC^SM delayed coking) used in refinery residue upgrading, in addition to other refinery residue upgrading technologies (solvent deasphalting and visbreaking), and a hydrogen production process used in oil refineries and petrochemical plants. We also own a proprietary sulfur recovery technology which is used to treat gas streams containing hydrogen sulfide for the purpose of reducing the sulfur content of fuel products and to recover a saleable sulfur by-product.

Additionally, our Global E&C Group owns and operates electric power generating wind farms in Italy and also owns a noncontrolling interest in two electric power generation projects, one waste-to-energy project and one wind farm project, all of which are located in Italy, and a noncontrolling interest in a joint venture company that is fully licensed to engineer, procure and construct process facilities in China.

Our Global E&C Group generates revenues from design, engineering, procurement, construction and project management activities pursuant to contracts spanning up to approximately four years in duration and generates equity earnings from returns on its noncontrolling interest investments in various power production facilities.

In the engineering and construction industry, we expect long-term demand to be strong for the end products produced by our clients, and we believe that this long-term demand will continue to stimulate investment by our clients in new, expanded and upgraded facilities. Our clients plan their investments based on long-term time horizons. We believe that global demand for energy, chemicals, minerals and pharmaceuticals will continue to grow over the long-term and that our clients will continue to invest in new and upgraded capacity to meet that demand.

Global markets in the engineering and construction industry are still experiencing intense competition among engineering and construction contractors and pricing pressure for contracts awarded. Clients’ bidding and contract award processes continue to be protracted, particularly for projects sponsored by national oil companies. Additionally, some clients have been releasing, and we expect will continue to release, tranches of work on a piecemeal basis. The engineering and construction industry may be further impacted by potential downside risk to global economic growth driven primarily by continued sovereign debt and bank funding pressures and continued recession in 2013 in the Eurozone, the speed and effectiveness of the implementation of government macroeconomic policies in a number of key advanced and emerging economies, slower growth than anticipated in emerging economies, most significantly China, and geopolitical oil supply risks, particularly in the Middle East, which could impact global economic growth through a significant rise in oil prices. If any of these risks materialize, our Global E&C Group could be impacted. However, we are seeing clients continuing to develop new projects and, after making final investment decisions, moving forward with previously planned projects. This includes a much stronger pipeline of projects in North America both in chemicals and LNG due to the availability of cheap gas supply from shale gas.

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We continue to be successful in booking contracts of varying types and sizes in our key end markets, including a sizable engineering, procurement and construction contract for a grassroots chemicals facility in North America, for which we were awarded the initial release for the engineering and procurement services during the second quarter of 2013, an engineering and procurement award for a delayed coker project in South America, a project management services award for a pharmaceutical facility in North America, an engineering, procurement and construction management, or EPCm, scope award for a cogeneration project in Asia, an engineering and procurement award for an upstream project in North America, an EPCm award for a chemicals project in Asia, an engineering and procurement award for a mineral processing facility in South America, an EPCm award for a chemicals project in Asia, an additional release of work for a delayed coker project in Europe, an engineering and procurement award for a gas treatment facility in North America, a front-end engineering design, or FEED, award for a cogeneration project in Asia, an EPCm award for a chemicals facility upgrade in Asia, design and materials supply contracts for ten fired heaters for refinery projects in Russia, a FEED award for a new gas plant and associated facilities in the Middle East, an EPCm award for a chemicals project in the Middle East, a project management consultancy award for a new refinery in Eurasia and a FEED award for a chemicals project in Europe.

We believe our success in this regard is a reflection of our technical expertise, our project execution performance, our long-term relationships with clients, our safety performance, and our selective approach in pursuit of new prospects where we believe we have significant differentiators.

Global Power Group

	Quarter Ended September 30,										Nine Months Ended September 30,
	2013		2012		$ Change			% Change			2013		2012		$ Change			% Change
Operating revenues	$	186,798	$	219,224	$	(32,426	)		(14.8	)%	$	589,656	$	746,261	$	(156,605	)		(21.0	)%
EBITDA	$	45,428	$	64,396	$	(18,968	)		(29.5	)%	$	115,699	$	158,535	$	(42,836	)		(27.0	)%

Results

Our Global Power Group’s operating revenues by geographic region for the quarter and nine months ended September 30, 2013 and 2012, based upon where our projects are being executed, were as follows:

	Quarter Ended September 30,										Nine Months Ended September 30,
	2013		2012		$ Change			% Change			2013		2012		$ Change			% Change
Africa	$	55	$	—	$	55			N/M		$	82	$	2,450	$	(2,368	)		(96.7	)%
Asia Pacific		93,045		99,246		(6,201	)		(6.2	)%		242,451		311,426		(68,975	)		(22.1	)%
Europe		61,444		48,788		12,656			25.9	%		187,982		229,704		(41,722	)		(18.2	)%
Middle East		383		1,312		(929	)		(70.8	)%		4,520		8,965		(4,445	)		(49.6	)%
North America		24,710		61,825		(37,115	)		(60.0	)%		137,071		169,823		(32,752	)		(19.3	)%
South America		7,161		8,053		(892	)		(11.1	)%		17,550		23,893		(6,343	)		(26.5	)%
Total	$	186,798	$	219,224	$	(32,426	)		(14.8	)%	$	589,656	$	746,261	$	(156,605	)		(21.0	)%

Please refer to the “—Overview of Segment” section below for a discussion of our Global Power Group’s market outlook.

Quarter Ended September 30, 2013

Our Global Power Group experienced a decrease in operating revenues in the third quarter of 2013, compared to the same period in 2012. This decrease was primarily driven by decreased volume of business. Excluding currency impacts, our Global Power Group’s operating revenues decreased 17% in the third quarter of 2013, compared to the same period in 2012.

Our Global Power Group’s EBITDA decreased in the third quarter of 2013, compared to the same period in 2012, primarily driven by decreased contract profit of $11,700, a charge for severance-related postemployment benefits of $3,000 recognized in the third quarter of 2013, the unfavorable impact of the inclusion of a gain recognized during the third quarter of 2012 related to a favorable settlement of our claim with a client on a legacy project of $2,000 and decreased governmental economic subsidies and other non-income tax credits of $1,500. The decrease in contract profit resulted from decreased volume of operating revenues, while contract profit margin was relatively unchanged. During the third quarter of 2013 our Global Power Group’s EBITDA included an aggregate severance-related postemployment benefits charge of $3,000 that included amounts in SG&A of $2,200 and cost of operating revenues of $800.

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Nine Months Ended September 30, 2013

Our Global Power Group experienced a decrease in operating revenues in the nine months ended September 30, 2013, compared to the same period in 2012. This decrease was primarily driven by decreased volume of business. Excluding currency impacts, our Global Power Group’s operating revenues decreased 23% in the nine months ended September 30, 2013, compared to the same period in 2012.

Our Global Power Group’s EBITDA decreased in the nine months ended September 30, 2013, compared to the same period in 2012, primarily driven by decreased contract profit of $29,300, a charge for severance-related postemployment benefits of $4,100 recognized in the nine months ended September 30, 2013, the unfavorable impact of the inclusion of a gain recognized during the first nine months of 2012 related to a favorable settlement of our claim with a client on a legacy project of $2,000 and decreased governmental economic subsidies and other non-income tax credits of $1,500, partially offset by increased equity earnings from our Global Power Group’s project in Chile of $3,800. The decrease in contract profit primarily resulted from decreased volume of operating revenues, partially offset by increased contract profit margin. Additionally, the decrease in contract profit included the unfavorable impact resulting from the inclusion of a settlement with a subcontractor of approximately $6,900 during the nine months ended September 30, 2012. During the nine months ended September 30, 2013, our Global Power Group’s EBITDA included a severance-related postemployment benefits charge of $4,100 that included amounts in SG&A of $2,400 and cost of operating revenues of $1,700.

Equity Earnings from Project in Chile

Our equity earnings from our Global Power Group’s project in Chile were relatively unchanged with balances of $5,400 and $5,300 in the third quarter of 2013 and 2012, respectively.

Our equity earnings from our project in Chile were $22,500 and $18,700 in the nine months ended September 30, 2013 and 2012, respectively. The increase in equity earnings in the nine months ended September 30, 2013, compared to the same period in 2012, was primarily driven by three items: a $3,200 increase in our share of the project’s 2012 earnings recognized as a result of a revised earnings allocation for 2012 that was approved in connection with the approval by the project’s governing board of the 2012 earnings distribution in the second quarter of 2013, and a $3,000 increase from the reversal of an insurance-related contingency during the second quarter of 2013, partially offset by the impact of lower marginal rates for electrical power generation in the nine months ended September 30, 2013.

Overview of Segment

Our Global Power Group designs, manufactures and erects steam generators and auxiliary equipment for electric power generating stations, district heating and power plants and industrial facilities worldwide. Our competitive differentiation in serving these markets is the ability of our products to cleanly and efficiently burn a wide range of fuels, singularly or in combination. In particular, our circulating fluidized-bed, which we refer to as CFB, steam generators are able to burn coals of varying quality, as well as petroleum coke, lignite, municipal waste, waste wood, biomass, and numerous other materials. Among these fuel sources, coal is the most widely used, and thus the market drivers and constraints associated with coal strongly affect the steam generator market and our Global Power Group’s business. Additionally, our Global Power Group holds a controlling interest and operates a combined-cycle gas turbine facility; owns a noncontrolling interest in a petcoke-fired CFB facility for refinery steam and power generation; and operates a university cogeneration power facility for steam/electric generation.

Our Global Power Group offers a number of other products and services related to steam generators, including:

• Design, manufacture and installation of auxiliary and replacement equipment for utility power and industrial facilities, including surface condensers, feedwater heaters, coal pulverizers, steam generator coils and panels, biomass gasifiers, and replacement parts for steam generators;

• Design, supply and installation of nitrogen-oxide, or NO_x, reduction systems and components for pulverized coal steam generators such as selective catalytic reduction systems, low NO_x combustion systems, low NO_x burners, primary combustion and overfire air systems and components, fuel and combustion air measuring and control systems and components;

• Design, supply and installation of flue gas desulfurization equipment for all types of steam generators and industrial equipment;

• A broad range of site services including construction and erection services, maintenance engineering, steam generator upgrading and life extension, and plant repowering;

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• Research and development in the areas of combustion, fluid and gas dynamics, heat transfer, materials and solid mechanics; and

• Technology licenses to other steam generator suppliers in select countries.

Global GDP growth is a key driver of demand for power. The slow economic growth in recent years has negatively impacted the demand for our products and services. However, we believe that a gradual upturn in global economic growth will begin as we progress through 2014, which we further believe will improve demand for the products and services of our Global Power Group. However, a number of constraining market factors continues to impact the markets that we serve. Political and environmental sensitivity regarding coal-fired steam generators in certain geographies continues to cause prospective projects utilizing coal as their primary fuel to be postponed or cancelled as clients experience difficulty in obtaining the required environmental permits or decide to wait for additional clarity regarding governmental regulations. The sensitivity has been especially pronounced in the U.S. and Western Europe due to the concern that coal-fired steam generators, relative to alternative fuel sources, contribute more toward global warming through the discharge of greenhouse gas emissions into the atmosphere. The outlook for continued lower natural gas pricing over the next three to five years in North America has increased the attractiveness of natural gas, in relation to coal and renewables, for the generation of electricity. In addition, the constraints on the global credit market may continue to impact some of our clients’ investment plans as these clients are affected by the availability and cost of financing, as well as their own financial strategies, which could include cash conservation. These factors could negatively impact investment in the power sector, which in turn could negatively impact our Global Power Group’s business.

There is potential downside risk to global economic growth driven primarily by continued sovereign debt and bank funding pressures and continued recession in 2013 in the Eurozone, the speed and effectiveness of the implementation of government macroeconomic policies in a number of key advanced and emerging economies, slower growth than anticipated in emerging economies, most significantly China, and geopolitical oil supply risks, particularly in the Middle East, which could impact global economic growth through a significant rise in oil prices. If any of these risks materialize, our Global Power Group could be impacted.

Longer-term, we believe that global demand for electrical energy will continue to grow. We believe that the majority of the growth will be driven by emerging economies and that solid-fuel-fired steam generators will continue to fill a portion of the growth in new generating capacity in the emerging economies.

Globally, we see a growing need to replace older coal plants with new, more efficient and cleaner burning plants, including both coal and other fuels, in order to meet environmental, financial and reliability requirements. The fuel flexibility of our CFB steam generators enables them to burn a wide variety of fuels other than coal and to produce carbon-neutral electricity when fired by biomass. In addition, our utility steam generators can be designed to incorporate supercritical steam technology, which significantly improves power plant efficiency and reduces power plant emissions.

We are currently executing a project for four 550 megawatt electrical, or MWe, supercritical CFB steam generators for a power project in South Korea, which we believe is an indication of the successful scale-up of our CFB technology and further advances our CFB supercritical technology with a vertical-tube, once-through design. Commercial operation of the units is scheduled for 2015.

We completed an engineering and supply project for a pilot-scale (approximately 30 megawatt thermal, equivalent to approximately 10 MWe) CFB steam generator, which incorporates our carbon-capturing Flexi-Burn^TM technology. Further, we are executing a project together with other parties, which is funded by a grant agreement with the European Commission to support the technology development of a commercial scale (approximately 300 MWe) Carbon Capture and Storage demonstration plant featuring our Flexi-Burn^TM CFB technology.

Recently we were awarded a contract for the design, supply and erection of a 50 MWe CFB steam generator island in Poland. We were also given full notice to proceed on the design and supply of a waste-to-energy CFB steam generator for the Green Energy Centre Project in South Korea. Additionally, we received two limited notices to proceed; one for an engineering, procurement and construction contract for a steam plant in the U.S. and another for three utility package steam generators in Canada.

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Liquidity and Capital Resources

Cash Flows Activities

Our cash and cash equivalents and restricted cash balances were:

	As of
	September 30, 2013		December 31, 2012		$ Change			% Change
Cash and cash equivalents	$	497,129	$	582,322	$	(85,193	)		(14.6	)%
Restricted cash		54,602		62,189		(7,587	)		(12.2	)%
Total	$	551,731	$	644,511	$	(92,780	)		(14.4	)%

Total cash and cash equivalents and restricted cash held by our non-U.S. entities as of September 30, 2013 and December 31, 2012 were $392,800 and $522,300, respectively.

During the first nine months of 2013, we experienced a decrease in cash and cash equivalents of $85,200. The decrease in cash and cash equivalents included cash used to repurchase shares and to pay related commissions under our share repurchase program of $150,100, cash used for business acquisitions, net of cash acquired, of $52,800, capital expenditures of $21,800 and distributions to noncontrolling interests of $12,600. The above use of cash was partially offset by cash provided by operating activities of $114,100, proceeds received from the disposition of a business of $48,600 and a decrease in restricted cash, excluding foreign currency translation effects, of $9,200.

Cash Flows from Operating Activities

	Nine Months Ended September 30,
	2013		2012		$ Change
Net cash provided by operating activities — continuing operations	$	114,082	$	109,674	$	4,408

Net cash provided by operating activities in the first nine months of 2013 primarily resulted from cash provided by net income of $230,100, which included a gain and related cash receipts of $15,800 for an insurance receivable related to an insolvent insurance carrier, which we had previously written-off, and excluded non-cash charges of $92,000, partially offset by cash used for working capital of $89,200, cash used for net asbestos-related payments of $10,800, which excluded the above collection of an insurance receivable of $15,800 as the gain was recognized in net income, and mandatory contributions to our non-U.S. pension plans of $14,900.

The increase in net cash provided by operating activities of $4,400 in the first nine months of 2013, compared to the same period of 2012, resulted primarily from increased cash provided by net income excluding non-cash charges of $24,900, which included the above gain and related cash receipts of $15,800 of an insurance receivable during the first nine months of 2013, partially offset by increased cash used for asbestos-related activities of $7,600, which excluded the above collection of an insurance receivable of $15,800 during the first nine months of 2013 as the gain was recognized in net income, increased payments for mandatory contributions to our non-U.S. pension plans of $4,100 and an increase in cash used to fund working capital of $3,400.

Working capital varies from period to period depending on the mix, stage of completion and commercial terms and conditions of our contracts and the timing of the related cash receipts. During the first nine months of 2013 and 2012, we used cash to fund working capital, as cash used for services rendered and purchases of materials and equipment exceeded cash receipts from client billings, which included the impact of delayed project payments and contributed to our receivables balance. Project payments can be delayed, particularly on contracts involving national oil companies, due to those customers’ internal processes for approval of invoices and release of funds. In general, delay in payment by our customers is not indicative of customer credit risk. In other cases where payments are delayed due to disagreements between us and our clients regarding the level of or quality of work performed or regarding billing terms, we assess our contractual right to invoice the client and, if we believe there is a probable commercial risk to collection of contract revenues, we provide an allowance against the valuation of contract work in progress within the contract.

As more fully described below in “—Outlook,” we believe our existing cash balances and forecasted net cash provided from operating activities will be sufficient to fund our operations throughout the next 12 months. Our ability to maintain or increase our cash flows from operating activities in future periods will depend in large part on the demand for our products and services and our operating performance in the future. Please refer to the sections entitled “—Global E&C Group-Overview of Segment” and “—Global Power Group-Overview of Segment” above for our view of the outlook for each of our business segments.

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Cash Flows from Investing Activities

	Nine Months Ended September 30,
	2013			2012			$ Change
Net cash used in investing activities — continuing operations	$	(28,282	)	$	(54,887	)	$	26,605

The net cash used in investing activities in the first nine months of 2013 was attributable primarily to cash used for business acquisitions, net of cash acquired, of $52,800, capital expenditures of $21,800 and cash used for investments in and advances to unconsolidated affiliates of $11,800, partially offset by proceeds received from the disposition of a business of $48,600, and a decrease in restricted cash, excluding foreign currency translation effects, of $9,200.

The net cash used in investing activities in the first nine months of 2012 was attributable primarily to an increase in restricted cash, excluding foreign currency translation effects, of $34,300 and capital expenditures of $26,400, partially offset by cash provided by a return of investment from unconsolidated affiliates of $6,200.

The capital expenditures in the first nine months of 2013 and 2012 related primarily to leasehold improvements, information technology equipment and office equipment.

Cash Flows from Financing Activities

	Nine Months Ended September 30,
	2013			2012			$ Change
Net cash used in financing activities	$	(167,167	)	$	(73,810	)	$	(93,357	)

The net cash used in financing activities in the first nine months of 2013 was attributable primarily to cash used to repurchase shares and to pay related commissions under our share repurchase program of $150,100. Other financing activities included distributions to noncontrolling interests of $12,600 and repayment of debt and capital lease obligations of $8,600, partially offset by cash received from the exercise of stock options of $4,300.

The net cash used in financing activities in the first nine months of 2012 was attributable primarily to cash used to repurchase shares and to pay related commissions under our share repurchase program of $50,900. Other financing activities included distributions to noncontrolling interests of $12,500 and repayment of debt and capital lease obligations of $7,100.

Outlook

Our liquidity forecasts cover, among other analyses, existing cash balances, cash flows from operations, cash repatriations, changes in working capital activities, unused credit line availability and claim recoveries and proceeds from asset sales, if any. These forecasts extend over a rolling twelve-month period. Based on these forecasts, we believe our existing cash balances and forecasted net cash provided by operating activities will be sufficient to fund our operations throughout the next twelve months. Based on these forecasts, our primary cash needs will be working capital, capital expenditures, pension contributions and net asbestos-related payments. We may also use cash for acquisitions, discretionary pension plan contributions or to repurchase our shares under the share repurchase program, as described further below. The majority of our cash balances are invested in short-term interest bearing accounts with maturities of less than three months at creditworthy financial institutions around the world. Further significant deterioration of the current global economic and credit market environment, particularly in the Eurozone countries, could challenge our efforts to maintain our well-diversified asset allocation with creditworthy financial institutions and/or unfavorably impact our liquidity and financial statements. We will continue to monitor the global economic environment, particularly in those countries where we have operations or assets. We continue to consider investing some of our cash in longer-term investment opportunities, including the acquisition of other entities or operations in the engineering and construction industry or power industry and/or the reduction of certain liabilities, such as unfunded pension liabilities.

It is customary in the industries in which we operate to provide standby letters of credit, bank guarantees or performance bonds in favor of clients to secure obligations under contracts. We believe that we will have sufficient letter of credit capacity from existing facilities throughout the next twelve months.

Please refer to Note 12 to the consolidated financial statements in this quarterly report on Form 10-Q for further information regarding a potential draw on our letters of credit totaling approximately $59,000 related to a project claim. Due to the uncertainty of the matter and related timing, we have not included the potential impact in our above referenced liquidity forecasts. However, even though such a draw would negatively impact our short-term liquidity, we believe we would have sufficient cash balances and generate sufficient operating cash flows to fund operations for the next twelve months.

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We are dependent on cash repatriations from our subsidiaries to cover payments and expenses of our parent holding company in Switzerland, to cover cash needs related to our asbestos-related liability and other overhead expenses in the U.S. and, at our discretion, specific liquidity needs, such as funding acquisitions and our share repurchase program, as described further below. Consequently, we require cash repatriations to Switzerland and the U.S. from our entities located in other countries in the normal course of our operations to meet our Swiss and U.S. cash needs and have successfully repatriated cash for many years. We believe that we can repatriate the required amount of cash to Switzerland and the U.S. Additionally, we continue to have access to the revolving credit portion of our senior credit facility, if needed.

Our net asbestos-related cash inflows are the result of insurance proceeds in excess of payments related to asbestos liability indemnity and defense costs. During the first nine months of 2013, we had net asbestos-related cash inflows of approximately $5,000, which included cash receipts of $15,800 on the collection of an insurance receivable balance related to an insolvent insurance carrier. We expect net cash outflows for the full year 2013 to be approximately $1,100. This estimate assumes no additional settlements with insurance companies or elections by us to fund additional payments. As we continue to collect cash from insurance settlements and assuming no increase in our asbestos-related insurance liability or any future insurance settlements, the asbestos-related insurance receivable recorded on our balance sheet will continue to decrease.

On August 3, 2012, we entered into a new five-year senior unsecured credit agreement, which replaced our amended and restated senior unsecured credit agreement from July 2010. Our new senior credit agreement provides for a facility of $750,000 and contains an increase option permitting us, subject to certain requirements, to arrange with existing lenders and/or new lenders to provide up to an aggregate of $300,000 in additional commitments. During the term of this senior credit agreement, we may request, subject to certain requirements, up to two one-year extensions of the contractual termination date.

We can issue up to $750,000 under the letter of credit portion of the facility. Letters of credit issued under our new senior credit agreement have performance pricing that is decreased (or increased) as a result of improvements (or reductions) in our corporate credit ratings, as defined in the senior credit agreement. Based on our current credit ratings, letter of credit fees for performance and non-performance letters of credit issued under our new senior credit agreement are 0.75% and 1.50% per annum of the outstanding amount, respectively, excluding a nominal fronting fee. We also have the option to use up to $250,000 of the $750,000 for revolving borrowings at a rate equal to adjusted LIBOR, as defined in the senior credit agreement, plus 1.50%, subject also to the performance pricing noted above.

We had approximately $250,900 and $250,600 of letters of credit outstanding under our senior credit agreement as of September 30, 2013 and December 31, 2012, respectively. There were no funded borrowings under our senior credit agreement as of September 30, 2013 and December 31, 2012. Based on our current operating plans and cash forecasts, we do not intend to borrow under our senior credit agreement over the next twelve months. Please refer to Note 5 to the consolidated financial statements in this quarterly report on Form 10-Q for further information regarding our debt obligations.

We are not required to make any mandatory contributions to our U.S. pension plans in 2013 based on the minimum statutory funding requirements. We made mandatory contributions totaling approximately $14,900 to our non-U.S. pension plans during the first nine months of 2013. Based on the minimum statutory funding requirements for 2013, we expect to make mandatory contributions totaling approximately $20,600 to our non-U.S. pension plans for the full year. Additionally, we may elect to make discretionary contributions to our U.S. and/or non-U.S. pension plans during 2013.

On September 12, 2008, we announced a share repurchase program pursuant to which our Board of Directors authorized the repurchase of up to $750,000 of our outstanding shares and the designation of the repurchased shares for cancellation. On November 4, 2010, our Board of Directors proposed an increase to our share repurchase program of $335,000, which was approved by our shareholders at an extraordinary general meeting on February 24, 2011. On February 22, 2012, our Board of Directors proposed an additional increase to our share repurchase program of approximately $419,398, which was approved by our shareholders at our 2012 annual general meeting on May 1, 2012.

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Based on the aggregate share repurchases under our program through September 30, 2013, we were authorized to spend up to an additional $270,100 to repurchase our outstanding shares. Any repurchases will be made at our discretion in the open market or in privately negotiated transactions in compliance with applicable securities laws and other legal requirements and will depend on a variety of factors, including market conditions, share price and other factors. The program does not obligate us to acquire any particular number of shares. The program has no expiration date and may be suspended or discontinued at any time. Any repurchases made pursuant to the share repurchase program will be funded using our cash on hand. Through September 30, 2013, we have repurchased 50,502,778 shares for an aggregate cost of approximately $1,234,300 since the inception of the repurchase program announced on September 12, 2008. We have executed the repurchases in accordance with 10b5-1 repurchase plans as well as other privately negotiated transactions pursuant to our share repurchase program. The 10b5-1 repurchase plans allow us to purchase shares at times when we may not otherwise do so due to regulatory or internal restrictions. Purchases under the 10b5-1 repurchase plans are based on parameters set forth in the plans. For further information, please refer to Part II, Item 2 of this quarterly report on Form 10-Q.

We have not declared or paid a cash dividend since July 2001 and we do not have any plans to declare or pay any cash dividends. Our current senior credit agreement contains limitations on cash dividend payments as well as other restricted payments.

Off-Balance Sheet Arrangements

We own several noncontrolling interests in power projects in Chile and Italy. Certain of the projects have third-party debt that is not consolidated in our balance sheet. We have also issued certain guarantees for our project in Chile. Please refer to Note 3 to the consolidated financial statements in this quarterly report on Form 10-Q for further information related to these projects.

New Orders and Backlog

New orders are recorded and added to the backlog of unfilled orders based on signed contracts as well as agreed letters of intent, which we have determined are legally binding and likely to proceed.

Backlog can fluctuate from one reporting period to the next due to the timing of new awards and when the contract revenue is recognized in our consolidated financial statements. The timing and duration of backlog execution is dependent upon the scope and type (or nature) of the work being executed. The elapsed time from the award of a contract to completion of performance can be as short as several quarters and may be up to approximately four years. At any point in time, our backlog contains a portfolio of contracts at various stages of completion and that will be executed at varying rates over varying durations. We cannot predict with certainty the portion of backlog to be performed in a given year.

Although backlog represents only business that is considered likely to be performed, cancellations or scope adjustments may and do occur. The dollar amount of backlog is not necessarily indicative of our future earnings related to the performance of such work due to factors outside our control, such as changes in project schedules, scope adjustments or project cancellations. Backlog is adjusted quarterly to reflect new orders, project cancellations, deferrals, revised project scope and cost and purchases and sales of subsidiaries, if any.

Backlog measured in Foster Wheeler scope reflects the dollar value of backlog excluding third-party costs incurred by us on a reimbursable basis as agent or principal, which we refer to as flow-through costs. Foster Wheeler scope measures the component of backlog with profit potential and corresponds to our services plus fees for reimbursable contracts and total selling price for fixed-price or lump-sum contracts.

The tables below detail our new orders and backlog of unfilled orders by period and include balances for discontinued operations for periods prior to September 30, 2013, which were insignificant based on our consolidated and business group balances:

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New Orders, Measured in Terms of Future Revenues

	September 30, 2013						September 30, 2012
	Global E&C Group		Global Power Group		Total		Global E&C Group		Global Power Group		Total
By Project Location:
Quarter Ended
Africa	$	4,900	$	—	$	4,900	$	24,200	$	—	$	24,200
Asia Pacific		97,200		38,500		135,700		207,500		48,900		256,400
Europe		117,300		71,300		188,600		69,300		57,800		127,100
Middle East		120,400		1,500		121,900		113,900		3,100		117,000
North America		1,114,900		59,600		1,174,500		45,200		68,200		113,400
South America		43,700		7,000		50,700		377,900		7,900		385,800
Total	$	1,498,400	$	177,900	$	1,676,300	$	838,000	$	185,900	$	1,023,900
Nine Months Ended
Africa	$	43,200	$	100	$	43,300	$	41,600	$	—	$	41,600
Asia Pacific		281,100		162,500		443,600		639,100		92,200		731,300
Europe		370,100		142,000		512,100		403,200		167,800		571,000
Middle East		249,600		2,000		251,600		224,200		3,400		227,600
North America		1,536,400		140,400		1,676,800		189,500		176,200		365,700
South America		146,700		20,100		166,800		509,900		24,200		534,100
Total	$	2,627,100	$	467,100	$	3,094,200	$	2,007,500	$	463,800	$	2,471,300
By Industry:
Quarter Ended
Power generation	$	43,700	$	164,500	$	208,200	$	3,300	$	155,700	$	159,000
Oil refining		264,600		—		264,600		417,400		—		417,400
Pharmaceutical		194,900		—		194,900		10,700		—		10,700
Oil and gas		79,300		—		79,300		34,400		—		34,400
Chemical/petrochemical		896,600		—		896,600		356,900		—		356,900
Power plant design, operation and maintenance		14,500		13,400		27,900		4,000		30,200		34,200
Environmental		1,400		—		1,400		1,100		—		1,100
Other, net of eliminations		3,400		—		3,400		10,200		—		10,200
Total	$	1,498,400	$	177,900	$	1,676,300	$	838,000	$	185,900	$	1,023,900
Nine Months Ended
Power generation	$	46,400	$	406,000	$	452,400	$	49,200	$	380,300	$	429,500
Oil refining		850,400		—		850,400		936,900		—		936,900
Pharmaceutical		235,000		—		235,000		46,100		—		46,100
Oil and gas		273,000		—		273,000		398,500		—		398,500
Chemical/petrochemical		1,104,400		—		1,104,400		528,300		—		528,300
Power plant design, operation and maintenance		36,300		61,100		97,400		14,900		83,500		98,400
Environmental		5,000		—		5,000		6,600		—		6,600
Other, net of eliminations		76,600		—		76,600		27,000		—		27,000
Total	$	2,627,100	$	467,100	$	3,094,200	$	2,007,500	$	463,800	$	2,471,300

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Backlog, Measured in Terms of Future Revenues

	As of September 30, 2013						As of December 31, 2012
	Global E&C Group		Global Power Group		Total		Global E&C Group		Global Power Group		Total
By Contract Type:
Lump-sum turnkey	$	1,300	$	17,300	$	18,600	$	3,200	$	67,500	$	70,700
Other fixed-price		533,000		544,900		1,077,900		662,500		665,200		1,327,700
Reimbursable		2,820,700		25,000		2,845,700		2,219,000		30,600		2,249,600
Total	$	3,355,000	$	587,200	$	3,942,200	$	2,884,700	$	763,300	$	3,648,000
By Project Location:
Africa	$	43,600	$	—	$	43,600	$	58,200	$	—	$	58,200
Asia Pacific		486,200		331,200		817,400		616,300		435,400		1,051,700
Europe		442,200		127,200		569,400		508,500		150,700		659,200
Middle East		858,600		2,000		860,600		850,700		4,600		855,300
North America		1,075,900		98,900		1,174,800		295,100		142,800		437,900
South America		448,500		27,900		476,400		555,900		29,800		585,700
Total	$	3,355,000	$	587,200	$	3,942,200	$	2,884,700	$	763,300	$	3,648,000
By Industry:
Power generation	$	10,600	$	550,900	$	561,500	$	269,000	$	699,500	$	968,500
Oil refining		1,424,300		—		1,424,300		1,676,000		—		1,676,000
Pharmaceutical		47,000		—		47,000		26,600		—		26,600
Oil and gas		251,900		—		251,900		269,600		—		269,600
Chemical/petrochemical		1,372,600		—		1,372,600		630,000		—		630,000
Power plant design, operation and maintenance		185,500		36,300		221,800		100		63,800		63,900
Environmental		3,700		—		3,700		3,200		—		3,200
Other, net of eliminations		59,400		—		59,400		10,200		—		10,200
Total	$	3,355,000	$	587,200	$	3,942,200	$	2,884,700	$	763,300	$	3,648,000
Backlog, measured in terms of Foster Wheeler Scope	$	2,918,800	$	583,900	$	3,502,700	$	2,196,700	$	753,500	$	2,950,200
Global E&C Group Man-hours in Backlog (in thousands)		20,900				20,900		17,000				17,000

The foreign currency translation impact on backlog and Foster Wheeler scope backlog resulted in decreases of $49,500 and $46,300, respectively, as of September 30, 2013 compared to December 31, 2012.

Inflation

The effect of inflation on our financial results is minimal. Although a majority of our revenues are realized under long-term contracts, the selling prices of such contracts, established for deliveries in the future, generally reflect estimated costs to complete the projects in these future periods. In addition, many of our projects are reimbursable at actual cost plus a fee, while some of the fixed-price contracts provide for price adjustments through escalation clauses.

Application of Critical Accounting Estimates

Our consolidated financial statements are presented in accordance with accounting principles generally accepted in the United States of America. Management and the Audit Committee of our Board of Directors approve the critical accounting policies. A full discussion of our critical accounting policies and estimates is included in our 2012 Form 10-K. We did not have a significant change to the application of our critical accounting policies and estimates during the first nine months of 2013.

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ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

During the first nine months of 2013, there were no material changes in the market risks as described in our annual report on Form 10-K for the year ended December 31, 2012.

ITEM 4. CONTROLS AND PROCEDURES

Disclosure Controls and Procedures

We maintain disclosure controls and procedures designed to ensure that information required to be disclosed by us in the reports that we file or submit under the Securities Exchange Act of 1934, as amended (the “Exchange Act”), is recorded, processed, summarized and reported, within the time periods specified in the SEC’s rules and forms. Disclosure controls and procedures include, without limitation, controls and procedures designed to ensure that the information required to be disclosed by us in the reports that we file or submit under the Exchange Act is accumulated and communicated to our management, including our principal executive and principal financial officers, or persons performing similar functions, as appropriate, to allow timely decisions regarding required disclosure. In designing and evaluating the disclosure controls and procedures, we recognize that any controls and procedures, no matter how well designed and operated, can provide only reasonable assurance of achieving the desired control objectives and we necessarily are required to apply our judgment in evaluating the cost-benefit relationship of possible controls and procedures.

As of the end of the period covered by this report, our chief executive officer and our chief financial officer carried out an evaluation, with the participation of our Disclosure Committee and management, of the effectiveness of the design and operation of our disclosure controls and procedures (as defined in Rules 13a-15(e) and 15d-15(e) under the Exchange Act) pursuant to Exchange Act Rule 13a-15. Based on this evaluation, our chief executive officer and our chief financial officer concluded, at the reasonable assurance level, that our disclosure controls and procedures were effective as of the end of the period covered by this report.

Changes in Internal Control Over Financial Reporting

There have been no changes in our internal control over financial reporting in the quarter ended September 30, 2013 that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

PART II. OTHER INFORMATION

ITEM 1. LEGAL PROCEEDINGS

Please refer to Note 12 to the consolidated financial statements in this quarterly report on Form 10-Q for a discussion of legal proceedings, which is incorporated by reference in this Part II.

ITEM 1A. RISK FACTORS

Our business is subject to a number of risks and uncertainties, including those disclosed in Part I, Item 1A, Risk Factors, in our Annual Report on Form 10-K for the year ended December 31, 2012 and in Part II, Item 1A, Risk Factors, in our Quarterly Report on Form 10-Q for the quarter ended March 31, 2013. No material changes to the risk factors disclosed in such annual report on Form 10-K and the additional risk factor in our quarterly report on Form 10-Q for the quarter ended March 31, 2013 have been identified during the first nine months of 2013.

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ITEM 2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS

(c) Purchases of Equity Securities by the Issuer and Affiliated Purchasers (amounts in thousands of dollars, except share data and per share amounts).

On September 12, 2008, we announced a share repurchase program pursuant to which our Board of Directors authorized the repurchase of up to $750,000 of our outstanding shares and the designation of the repurchased shares for cancellation. On November 4, 2010, our Board of Directors proposed an increase to our share repurchase program of $335,000, which was approved by our shareholders at an extraordinary general meeting on February 24, 2011. On February 22, 2012, our Board of Directors proposed an additional increase to our share repurchase program of approximately $419,398, which was approved by our shareholders at our 2012 annual general meeting on May 1, 2012. Under Swiss law, the repurchase of shares in excess of 10% of the company’s share capital must be approved in advance by the company’s shareholders.

For further information related to our share repurchase program and the cancellation of shares under Swiss law, please refer to Note 1 to the consolidated financial statements in this quarterly report on Form 10-Q.

The following table provides information with respect to purchases under our share repurchase program during the third quarter of 2013.

Fiscal Month	Total Number of Shares Purchased(1)		Average Price Paid  per Share		Total Number of  Shares Purchased as Part of Publicly Announced Plans or Programs(2)		Approximate Dollar Value of Shares that May Yet Be Purchased Under the Plans or Programs
July 1, 2013 through July 31, 2013		—	$	—		—
August 1, 2013 through August 31, 2013		—		—		—
September 1, 2013 through September 30, 2013		—		—		—
Total		—	$	—		—	$	270,054

⁽¹⁾  No shares were repurchased pursuant to our share repurchase program during the third quarter of 2013. As of September 30, 2013, we were authorized to spend up to an additional $270,054 to repurchase our outstanding shares. The repurchase program has no expiration date and may be suspended for periods or discontinued at any time. We did not repurchase any shares other than through our publicly announced repurchase program.

⁽²⁾  As of September 30, 2013, an aggregate of 50,502,778 shares were purchased for a total of $1,234,344 since the inception of the repurchase program announced on September 12, 2008.

ITEM 3. DEFAULTS UPON SENIOR SECURITIES

None.

ITEM 4. MINE SAFETY DISCLOSURES

None.

ITEM 5. OTHER INFORMATION

None.

58

ITEM 6. EXHIBITS

Exhibit No.	Exhibits
3.1	Organizational Regulations of Foster Wheeler AG. (Filed as Exhibit 3.1 to Foster Wheeler AG’s Form 8-K, filed on August 12, 2013, and incorporated herein by reference.)
10.1	Contract of Employment between Foster Wheeler Management Limited and Stephen Rostron, effective as of August 27, 2013.
10.2	Contract of Employment between Foster Wheeler Management Limited and Jon Nield, dated as of September 19, 2013.
23.1	Consent of Analysis, Research & Planning Corporation.
31.1	Certification pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 of J. Kent Masters.
31.2	Certification pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 of Franco Baseotto.
32.1	Certification pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 of J. Kent Masters.
32.2	Certification pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 of Franco Baseotto.
101.INS	XBRL Instance Document.
101.SCH	XBRL Taxonomy Extension Schema.
101.CAL	XBRL Taxonomy Extension Calculation Linkbase.
101.DEF	XBRL Taxonomy Extension Definition Linkbase.
101.LAB	XBRL Taxonomy Extension Label Linkbase.
101.PRE	XBRL Taxonomy Extension Presentation Linkbase.

59

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

	FOSTER WHEELER AG (Registrant)
Date: November 7, 2013	/S/ J. KENT MASTERS
	J. KENT MASTERS CHIEF EXECUTIVE OFFICER
Date: November 7, 2013	/S/ FRANCO BASEOTTO
	FRANCO BASEOTTO EXECUTIVE VICE PRESIDENT, CHIEF FINANCIAL OFFICER AND TREASURER

60

EX-10.1

Exhibit 10.1

CONTRACT OF EMPLOYMENT

between

FOSTER WHEELER MANAGEMENT LIMITED a company registered in England and Wales with company number 05344191 and whose registered office is at Shinfield Park, Shinfield, Reading, Berkshire RG2 9FW (the “Company”);

and

STEPHEN ROSTRON of 358 Lichfield Road, Four Oaks, Birmingham, West Midlands, B74 4BH (“you”).

This Contract of Employment was prepared on 24 April 2013. Its terms will take effect from 27 August 2013.

You should however read the entire document carefully as it creates legally binding obligations.

TERMS AND CONDITIONS OF EMPLOYMENT

This Contract of Employment (the “Contract”), together with any documents referred to in it (except as notified otherwise), including but not limited to the Confidential Information, Intellectual Property and Post-Termination Restrictions Agreement which is appended hereto and which will be signed by the Employee, contains the entire agreement and understanding between you and the Company and supersedes any prior agreements regarding your employment by the Company (including but not limited to any previous contract of employment between you and any Associated Company) which shall be deemed to have been terminated by mutual consent, save as otherwise confirmed to you.

1.0 DEFINITIONS

1.1 The definitions in this clause apply in this Contract.

“Associated Company” means (unless otherwise stated in this Contract) any company which is a direct or indirect subsidiary, subsidiary undertaking or holding company of the Company or any subsidiary or subsidiary undertaking of any such holding company and further includes but is not limited to Foster Wheeler AG and any direct or indirect subsidiary of it (and “Associated Companies”) shall be construed accordingly.

The expressions “subsidiary” and “holding company” shall have the meanings ascribed to them by the Companies Act 2006 as amended (Section 1159) and the expression “subsidiary undertaking” shall have the meaning ascribed to it by the same Act.

“Board” means the Board of Directors of the Parent.

“Committee” means the Compensation and Executive Development Committee of the Board.

“Company GP” means the occupational health professional designated and communicated as the Company GP from time to time.

“Foster Wheeler Group” means all the subsidiary companies (from time to time) of the Parent and any affiliate companies identified as part of the Group from time to time.

“Parent” means Foster Wheeler AG or such other company as may be amended from time to time.

“STI Programme” means the Foster Wheeler Annual Executive Short Term Incentive Plan as may be amended or replaced from time to time.

1.2 The headings in this agreement are inserted for convenience only and shall not affect its construction.

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1.3 A reference to a particular law is a reference to it as it is in force for the time being taking account of any amendment, extension, or re-enactment and includes any subordinate legislation for the time being in force made under it.

1.4 Unless the context otherwise requires, words in the singular include the plural and in the plural include the singular.

2.0 STANDARD TERMS

2.1 Conditions

You represent that by virtue of entering into this Contract and holding any directorships of the Company and any Associated Company you will not be in breach of any express or implied terms of any contract with or of any other obligation to any third party binding upon you.

This Contract is contingent upon:

you having the right to live and work in the UK or such other location at which you may be permanently based and carrying out your responsibilities pursuant to this Contract; and

the successful conclusion of reference and background checks.

2.2 Term

The terms and conditions in this Contract will take effect on and from 27 August 2013.

Your period of continuous employment shall start on 27 August 2013.

Your employment shall continue, subject to the terms of this Contract, until terminated in accordance with section 9 below.

2.3 Job Title and Duties

Your position is Chief Compliance Officer. You will report to the Chief Executive Officer of Foster Wheeler AG or his/her designated representative. The Company may from time to time second or assign you to work under the direction and control of any Associated Company globally (whether in relation to a specific project or otherwise). In no circumstances shall your title or service as an officer or director of any Associated Company (including but not limited to the Parent) be deemed to create an employment relationship with such Associated Company, unless otherwise expressly agreed by the Parent and/ or the Company as appropriate.

Where the need arises, the Company may require you to undertake duties or jobs outside the normal scope of your position. In exceptional circumstances this may include a post of a higher or lower grade: any proposal to change your post in this way will be discussed with you beforehand and the change will not be made without your consent, although such consent must not be unreasonably withheld.

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During the period of employment you are required, and agree, to:-

devote the whole of your time, attention and ability during your hours of work to carrying out your duties solely for the Company or any Associated Company that you are assigned to from time to time;

perform such duties as may be required from time to time for the Company or any Associated Company or for any of its or their customers or clients;

comply with all instructions given to you by the Company or any Associated Company, whether given verbally or in writing, and whether contained in policies or procedures or otherwise, and if so instructed comply with all instructions given by any customer or client of the Company or any Associated Company to the extent that they do not conflict with any instructions given to you by the Company or Associated Company;

keep the board of directors of the Company at all times, and the Board and any Associated Company as applicable upon request, promptly and fully informed (in writing if so requested) of your conduct of the business or affairs of the Company and any Associated Company and provide such explanations as it may require;

exercise such powers in relation to the conduct and management of the affairs of the Company and any Associated Company as may be assigned to or vested in you from time to time by the Company or the Parent or their designates (as appropriate) as shall be consistent with your position and at all times conform to their lawful and reasonable directions;

faithfully, dilligently and to the best of your abilities serve the Company and any Associated Company;

use your best endeavours to promote the interests of the Company and any Associated Company; and

not do anything to undermine the business or reputation of the Company or any Associated Company.

2.4 Place of Work

Your normal place of work is Reading and you agree to keep a residence within a reasonable daily commute of your normal place of work. However, Foster Wheeler is a global organisation with other locations and associated companies worldwide and in the UK. Consequently, the Company reserves the right to require you to work at another location within the UK where reasonably necessary for the performance of your duties or in the interests of the business. You may also be required to travel for business purposes, although it is not anticipated that any such trip outside the UK would last for a period exceeding a month. The Company will endeavour to consult with you about any proposed changes to your work location. You may also be required to work from home during business hours where the Company considers it appropriate.

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2.5 Business Trips

While on a business trip, you are required to comply with any applicable Company or corporate travel policy, work practice, project or local travel policy or other guidance or rules.

2.6 Working Hours and Overtime

Your core working hours are 40 hours per week.

The number of hours per week that you are required to work and the scheduling of those hours may be amended from time to time without notice to meet client and management requirements. You may be expected to work hours in excess of your normal working week where this is necessary for the proper performance of your duties and where this is reasonably required by the Company to meet business needs.

The Company believes that having regard to your position, the limits on working time imposed by the Working Time Regulations 1998 (as amended if applicable) do not apply. However, in signing this Contract you agree in any event that you will if reasonably required by the Company work hours in excess of an average 48 hours per week as defined by the Working Time Regulations 1998, and that the average weekly limit set out in regulation 4(1) of the Working Time Regulations 1998 shall not apply to your employment, subject to your right to withdraw this consent at any time by giving three months’ written notice.

2.7 Remuneration and Expenses

Your annual gross base salary (which shall be subject to deductions for income tax and national insurance contributions as required by law) is £175,000 (one hundred and seventy five thousand pounds) payable monthly.

Any change in your salary will be notified to you in writing. Salary reviews are carried out entirely at the Company’s discretion and the Company shall be under no obligation to increase your salary as part of any review. Salary reviews are also subject to the approval of the Committee which shall be exercised at the Committee’s absolute discretion. Your first salary review will occur during the first quarter of 2014.

You will be reimbursed for any reasonable expenses properly incurred by you while performing your duties on behalf of the Company (and any Associated Company), provided that you produce receipts in support of and detailing such expenses when submitting your claim, and subject to your compliance with any rules, policies and procedures of the Company (or any Associated Company as applicable) relating to reimbursement of expenses.

3.0 BENEFITS

3.1 Sign-on Equity Grant

As compensation for loss of long-term incentive awards earned with your current employer, you will receive the following:

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a. A grant of Restricted Stock Units (“RSUs”) which will be payable in registered shares of Foster Wheeler AG (“Shares”) with an economic value as of the Grant Date (as defined below) equal to forty three thousand and three United States Dollars ($43,003) (the “2010 Replacement RSUs”);

b. A grant of RSUs which will be payable in Shares with an economic value as of the Grant Date equal to sixty one thousand, one hundred and nine United States Dollars ($61,109) (the “2011 Replacement RSUs”); and

c. A grant of RSUs which will be payable in Shares with an economic value as of the Grant Date equal to forty thousand, seven hundred and forty United States Dollars ($40,740) (the “2012 Replacement RSUs”).

All of such Replacement RSUs will be granted on the first open trading window when it is practical to make such a grant subsequent to the date your employment commences under this Contract (“Grant Date”). The Replacement RSUs will vest rateably as set forth below, provided that you are still employed by the Company or one of its affiliates on such dates.

Replacement RSUs	Vesting and Settlement
2010 Replacement RSUs	One-half on 8 March 2014 One half on 8 March 2015
2011 Replacement RSUs	One-third on 8 March 2014 One-third on 8 March 2015 One-third on 8 March 2016
2012 Replacement RSUs	One-third on 8 March 2015 One-third on 8 March 2016 One-third on 8 March 2017

Furthermore, if your employment is terminated by the Company without notice before the relevant vesting dates listed above, the outstanding Replacement RSUs will vest in full on your Termination Date (as defined below).

The replacement RSUs will otherwise be governed by all provisions of the Foster Wheeler AG Omnibus Incentive Plan (the “Omnibus Plan”) and by separate agreement in the usual form approved by the Compensation and Executive Development Committee (the “Committee”) of the Board of Directors of the Parent (the “Board”). The actual number of Replacement RSUs to be granted will be calculated using the valuation methodology for valuing equity awards that has been approved and adopted by the Committee.

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3.2 Short Term Incentive (“STI”) Plan

You may be eligible during your employment to participate, as determined by the Board or the Committee of the Board in their absolute discretion and in accordance with any relevant policies, applicable law, or exchange listing requirements, in Foster Wheeler AG’s annual STI program as in effect from time to time for senior executives.

The current STI program in operation is the Foster Wheeler Annual Executive Short-Term Incentive Plan. You shall be eligible for an annual STI award at a target opportunity of forty five percent (45%) of your annual gross base salary (with payouts ranging from zero (0) to two times (2x) your target opportunity) based on achievement of certain objectives established in advance by the Company, the Board and/or the Committee and/ or their designate as necessary or appropriate to comply with relevant policies, applicable law, or exchange listing requirements. The actual amount of STI shall be determined by and in accordance with terms of the then-current STI program and you shall have no absolute right to participate in the STI in any year. Your annual STI for 2013 will be pro-rated from the Start Date.

3.3 Long-Term Incentive (“LTI”)

You shall be eligible during your employment for annual equity awards, as determined by the Board and/or the Committee as necessary or appropriate to comply with Company policy, applicable law, or exchange listing requirements, under the equity or LTI plan for senior executives, as in effect from time to time. The LTI plan currently in place is the Omnibus Plan. The actual amount of any LTI awards shall be determined by and in accordance with the terms of the then-current LTI award plan or program by the Company, the Board, and/or the Committee in their absolute discretion, and you shall have no absolute right to an LTI award in any year.

For the 2013 plan year, you will receive on the Grant Date the following, all of which will be issued under the Omnibus Plan:

a.     Restricted Stock Unit Grant: A grant of a number of RSUs that will be payable in Shares with a maximum economic value as of the Grant Date equal to sixty two thousand five hundred United States Dollars ($62,500) (the “2013 RSUs”).

b.     Performance Restricted Stock Units: A grant of a number of Restricted Stock Units with Performance Goals (“PRSUs”) which will be payable in Shares with a maximum economic value as on the Grant Date equal to sixty two thousand five hundred United States Dollars ($62,500) (the “2013 PRSUs”).

The value of the 2013 RSUs and 2013 PRSUs will be pro-rated to reflect your Start Date.

c.     Vesting and Settlement: The actual number of 2013 RSUs and 2013 PRSUs to be granted to you will be calculated using the valuation methodology for valuing equity that has been approved and adopted by the Committee. The 2013 RSUs will vest rateably on the first (1st), second (2nd), and third (3rd) anniversaries of 8 March 2013, provided that you are still employed by the Company or one of its affiliates on such dates. The 2013 PRSUs shall vest on the later of (i) 8 March 2016 of (ii) the date the Committee certifies the applicable Performance Goals were met, provided that you are still employed by the Company or one of its affiliates on the applicable vesting date. The 2013 PRSUs will have Performance Goals measured by comparing December 2012 to December 2015 on the terms set forth in the usual form of grant agreement that has been approved by the Committee.

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d.     Grant Agreements: The 2013 RSUs and the 2013 PRSUs will otherwise be governed by all provisions of the Omnibus Plan and by separate agreements in the usual form approved by the Committee.

3.4 Company Car Cash Allowance

You are eligible for a company car cash allowance of £14,400 per annum payable in monthly instalments with your salary payments. It will be separate from your salary and will be subject to tax and employee National Insurance contributions. It will not constitute pensionable earnings.

Provided that you hold a current driving licence you will be required to use your own car for road network business travel within the UK unless otherwise authorised by your manager. You must therefore insure your car for business use and ensure that it is well maintained, roadworthy and has a valid MOT certificate as applicable.

The enclosed cash allowance information sheet contains important information about the company car cash allowance. By signing this Contract, you indicate that you have read and understood this information. Please note that this information does not form part of your contract of employment and will be changed from time to time. Changes may be made without notice.

3.5 Private Healthcare Plan

The Company will bear the reasonable costs of membership of a private healthcare plan for your benefit.

Membership of the plan is subject to the terms of the plan and the rules or insurance policy of the plan provider, in each case as may be amended from time to time, and is subject always to the plan provider’s willingness to provide cover. It is a taxable benefit. You may be able to purchase additional cover for your partner and any eligible dependent children.

3.6 Pension

Details of the Foster Wheeler Pension Plan (“Plan”), a defined contribution pension plan, are contained in the prevailing plan booklets and subject to the rules of the Plan from time to time in force and the tax reliefs and exemptions available from HR Revenue & Customs.

No contracting out certificate under the Pensions Schemes Act 1993 (as amended as applicable) is in force in respect of your employment with the Company.

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3.7 Other Benefits

Subject to eligibility, you may be able to participate in certain insurance or other schemes as may be made available to you by the Company or an Associated Company from time to time. If you do participate in any such insurance schemes, and whether the particular scheme is contractual or non-contractual, payments will be made to you only insofar as the terms of the applicable Company/ Associated Company policy provides for cover and (where cover under the scheme is provided by an external organisation) where the applicable insurance policy provides for and pays for cover. The Company reserves the right in its sole and absolute discretion to discontinue, vary or amend the benefits provided at any time on reasonable notice to you. Where you have had the benefit of insurance or cover which is based on your level of salary, then the relevant level of salary going forward shall be as specified in this Contract.

3.8 Deductions

The Company will be entitled, at any time, to deduct from any salary or other remuneration due to you any monies that may be due and owing to the Company or any Associated Company (if applicable), including without limitation any overpayment, transitional payments, advances or loans made to you by the Company and/or any Associated Company, pay received for holiday taken in excess of pro rata entitlement or during periods of unauthorised absences, excess of commission paid and advance payments for anticipated expenses in excess of those expenses actually incurred.

Where any property or money belonging to the Company or any Associated Company or any client, customer, visitor, employee or agent of the Company or any Associated Company is lost or damaged through dishonesty on your part, or because of your serious or persistent negligence or recklessness or through any serious or persistent breach of the Company’s or any Associated Company’s rules, the Company reserves the right to require you to pay for any such loss or damage by a deduction from salary or other payments due to you from the Company.

By signing this Contract you accept the Company’s right to make such deductions. If the Company (or Associated Company as applicable) is unable, for whatever reason, to recoup monies due by making deductions, then it reserves its rights to pursue such repayment by other means, including through civil legal action.

3.9 Personal Indemnity

You shall indemnify the Company on a continuing basis in relation to any income tax and National Insurance contributions (save for employers’ National Insurance contributions), including any related interest, penalties, costs and expenses, which may be incurred by the Company if any exemptions applied under this contract of employment do not apply.

4.0 HOLIDAYS

You shall be entitled to 25 days paid holiday per annum

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Full time employees are also entitled to 8 public and other statutory holidays in England and Wales per annum.

The Company’s holiday year runs from 1st January to 31st December.

Your holiday entitlement for the first holiday year under this Contract will be calculated on a pro-rata basis for the number of full months worked in the year.

In some circumstances the Company or any Associated Company may direct you to take holiday on specific days, such as during the Christmas period. You will be notified if you need to keep aside any leave to cover such periods as this will vary each year and will depend upon whether your employment continues over such periods. There is no extra leave entitlement to cover the Christmas period.

You are not permitted to carry over unused holiday from one holiday year to the next without the prior approval of your line manager or his/ her designated representative, which will normally only be given in exceptional circumstances. For your welfare, two weeks of holiday must be taken as complete weeks of holiday. This may be either one fortnight or two separate weeks. No payment in lieu will be made for holiday not taken in any holiday year (except on termination of employment). In the interests of business efficiency not more than 3 consecutive weeks of holiday will normally be permitted.

The Company will try to accommodate holidays being taken on the dates requested. Where business demands make taking holiday difficult, this will be dealt with on an individual basis.

Upon termination of your employment for any reason you shall be entitled to payment in lieu on a pro rata basis for any holidays not taken which have accrued in the holiday year in which the date of termination falls. Upon termination of employment for any reason (including where you are dismissed summarily for gross misconduct) you shall repay the Company, or have deducted from your final salary or any other payments due to you, any salary received in respect of holiday taken prior to the date of termination in excess of your proportionate entitlement. Any payment in respect of accrued but untaken holiday, or overpaid holiday, is calculated at the daily rate of 1/260^th of your annual base salary (pro- rated as appropriate for part- time staff). The Company may, at its absolute discretion, require you to take holiday entitlement during your notice period. If your last day of employment is on or after the 15th of the month you will be entitled to the pro rata amount of holiday entitlement for that month. You will not be entitled to a payment in respect of any holiday accrued but untaken on termination if you refuse to take such holiday entitlement during the notice period.

Further information on holiday entitlement can be found in the relevant Company policy.

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5.0 SICKNESS

5.1 Sick Pay

If you are absent from work due to sickness or injury and subject to your compliance with the provisions relating to sickness absence notification and proof of incapacity as set out in the Sick Leave and Sickness Absence Notification policy (which is available on the Company’s intranet), the Company may at its sole and absolute discretion, pay you sick pay, based on your normal basic salary and your years of continuous service with the Company and any Associated Company and based on the following table:

Length of service at start of sickness/ injury absence	Maximum number of days for which Company sick pay (to include any entitlement to statutory sick pay) may be paid for a full time employee normally working 40 hours per week, to be pro- rated for part time employees
Up to 1 year exactly	20 working days at basic salary
Over 1 year and up to 2 years exactly	40 working days at basic salary
Over 2 years and up to 3 years exactly	60 working days at basic salary
Over 3 years	60 working days at basic salary followed by 60 working days at half basic salary

The payments given above are the normal maximum sick pay payments that will be paid in any rolling 12 month period and apply whether the periods of absence are continuous or intermittent. They are inclusive of any entitlement that you may have in that period to any statutory or legally mandated sick pay.

Any further payments of Company sick pay above the limits stated above shall be at the Company’s sole and absolute discretion.

5.2 Cessation of employment

If you are unable to perform your duties through sickness or injury for a period of 26 consecutive weeks or for periods aggregating 26 weeks in any period of 52 weeks, the Company shall be entitled to terminate your employment on notice.

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5.3 Unauthorised Absence

The Company reserves the right to withhold payment of or deduct from your salary one day’s pay for each day of unauthorised absence from work. “Unauthorised absence” means failure to report to work unless this is due to genuine sickness or injury notified to the Company in accordance with Company procedures, leave for which permission has been granted by your manager, or genuine reasons outside your control which are acceptable to the Company and agreed by your manager.

5.4 Medical Examination

The Company may on reasonable notice require you to undergo medical examinations undertaken by a registered medical practitioner nominated by the Company and at the Company’s expense at any time. Subject to the normal legal provisions, the medical practitioner may disclose to and discuss with the Company or any Associated Company, on a confidential basis, the results of the examination and the matters which arise from it where this information or any medical condition affects or may affect your ability to perform your job properly or affects or may affect your sick pay entitlement in any way.

6.0 DIRECTORSHIPS

It is usual practice for the Company to nominate appropriate employees to serve on the boards of companies, in which the group has shareholdings, including Associated Companies. In England and Wales, directors of companies have duties and responsibilities that are specified in part in legislation and in part in the relevant Articles of Association. Such obligations and responsibilities which derive from holding office as a director are separate to the terms of your employment with the Company. All directors have a duty to declare their other directorships, relevant shareholdings, and interest in material contracts. Further information about directors’ obligations can be obtained from the relevant company’s Secretary.

By entering into this agreement, you agree that if you are appointed as a director and/ or officer of the Company and/ or any of its Associated Companies you will comply with all associated duties, whether applicable in England and Wales or otherwise, including but not limited to any applicable duties or requirements as an officer under the Companies Act 2006 (as amended) (in the United Kingdom) and section 16 of the Securities Exchange Act of 1934 (as amended) (in the United States of America).

You further agree that at any time during your employment at the request of the Company or any Associated Company in relation to which you hold a directorship, and immediately on termination of your employment for whatever reason, you will resign from all offices held in the Company and any Associated Company (as applicable) (without prejudice to the rights of any party arising out of this Contract or the termination of your employment) without any compensation for loss of office and resign from membership of any association acquired exclusively by reason of or in connection with your employment. Should you fail to resign from such offices in accordance with this provision, the Company and/ or any Associated Company is irrevocably authorised to appoint a person in your name and on your behalf to sign a document or do anything necessary or requisite to bring about the appropriate resignation.

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7.0 CONFIDENTIALITY, CONFLICTS AND INTELLECTUAL PROPERTY RIGHTS

7.1 Conflict of Interests

You must not, without the prior written consent of the Company in any way directly or indirectly, alone or jointly, in any capacity whatsoever:-

1. be engaged or employed in or by;

2. be concerned with;

3. be interested in; and/ or

4. provide services to

any other business, individual, firm, company or other organisation where this is, or is likely to be, in conflict with the interests of the Company, and/or those of any Associated Company and/or those of any of its/their clients or customers and/or where this may adversely affect the efficient and proper discharge of your duties, including but not limited to any other individual, business, firm, company or other organisation which is a supplier to or customer of the Company or any Associated Company or which is wholly or partly in competition with the business carried on by the Company and/ or any Associated Company.

If you undertake other work during your normal working hours or use Company or Associated Company equipment for purposes other than the Company’s or Associated Company’s business, this will normally be treated as gross misconduct and could lead to dismissal.

If you wish to lecture, give talks or public speeches, publish material in any form, or release information on matters related to or arising from your employment with the Company or any Associated Company, you must obtain prior written agreement from the Company.

If you wish to take office in a public or professional body or take employment outside your core working hours you must obtain prior written agreement from the Company.

You agree that you will not during your employment with the Company or in consequence of your employment directly or indirectly receive or accept any commission, discount, service or other benefit, gift or payment in respect of any business transacted by or on behalf of the Company or any Associated Company. You further agree that if you do receive any such benefit, gift or payment you will immediately disclose it and account for it to the Company.

Notwithstanding anything to the contrary, nothing in this clause 7 prohibits the Employee from being a passive owner of not more than five percent (5%) of the outstanding stock of any class of a corporation which is publicly traded, so long as the Employee has no active participation in the business of such corporation.

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You shall comply where relevant with every rule of law, every regulation of The International Stock Exchange of the United Kingdom and Republic of Ireland, every regulation of the stock exchange where the Parent’s shares are traded and every regulation of the Company and/ or any Associated Company from time to time in force in relation to dealings in shares, debentures or other securities of the Company and/ or any Associated Company and unpublished price sensitive information affecting such shares, debentures or other securities. In relation to overseas dealings you shall also comply with all laws of the state and all regulations of the stock exchange, market or dealing system in which such dealings take place.

You shall not at any time make any untrue or misleading statement in relation to the Company and/ or any Associated Company.

For the purposes of this Contract, “Recognised Investment Exchange” means any body of persons which is for the time being a Recognised Investment Exchange for the purposes of the Financial Services and Markets Act 2000 (as amended).

By accepting employment and signing this Contract of Employment with the Company you represent and warrant to the Company:-

(i) that you are not party to any restrictive covenant or agreement that would preclude you from accepting employment with the Company and performing your duties as set out herein; and

(ii) that all of the information that you have provided to the Company in its review of you is true, correct and complete in all material respects.

7.2 Procedures

The Company has a number of policies and procedures (including those which apply in relation to assignments to Associated Companies) which are available on the Company’s intranet site. You are required to adhere to these documents (as may be amended from time to time) during and, in certain cases, after your employment with the Company. You are responsible for ensuring that you are familiar with and understand them and any amendments which may be made time to time. Please note that if you breach any policies and procedures this may be a disciplinary offence and could ultimately result in dismissal. These policies and procedures do not form part of your Contract unless they state otherwise.

7.3 Foster Wheeler AG Code of Business Conduct and Ethics

You will be bound by the Foster Wheeler AG Code of Business Conduct and Ethics. Breach of the Foster Wheeler AG Code of Business Conduct and Ethics may constitute misconduct or gross misconduct and result in disciplinary proceedings being taken, which could ultimately result in dismissal.

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7.4 Disciplinary, Capability, Appeals and Grievance Procedures

The Company Disciplinary, Capability, Appeals and Grievance procedures which apply to your employment can be found on the Company intranet site. They specify the individuals to whom Grievances and Appeals should be addressed. These procedures do not form part of your Contract and may be amended from time to time.

7.5 Confidentiality, Intellectual Property and Post-Termination Restrictions

At the same time as entering into this Agreement you will execute the Confidentiality, Intellectual Property and Post-Termination Restrictions Agreement which is appended at Appendix 1 hereto.

8.0 PERSONAL DATA

By signing this Contract you confirm that you will comply with the Company’s policies, procedures and guidelines on handling data (which may be amended from time to time) including but not limited to when processing personal data in the course of employment including personal data relating to any employee, customer, client, supplier or agent of the Company or any Associated Company.

You consent to the Company and/ or any Associated Company processing data relating to you (and your dependants) for legal, personnel, administrative and management purposes and in particular to the processing of any sensitive personal data (as defined in the Data Protection Act 1998) relating to you, including, as appropriate:

information relating to your physical or mental health or condition in order to monitor sick leave and take decisions as to your fitness for work;

your racial or ethnic origin or religious or similar information in order to monitor compliance with equal opportunities legislation;

information relating to any criminal proceedings in which you have been involved for insurance purposes and in order to comply with legal requirements and obligations to third parties.

The Company may make such information available to any Associated Company, those who provide products or services to the Company or any Associated Company (such as advisers, financial and taxation consultants and payroll administrators), regulatory authorities, potential or future employers, governmental or quasi-governmental organisations and potential purchasers of the Company or the business in which you work.

You consent to the transfer of such information to any Associated Company and the Company’s and/ or Associated Company’s business contacts outside the European Economic Area in order to further their business interests. Where your personal data is passed to any third party the Company will take all reasonable steps to ensure that it is held securely and used only for the purposes for which it is supplied.

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The Company currently offers an insurance scheme to provide insurance cover for employees whilst undertaking business trips. If you have an illness or accident which requires the assistance of the insurance scheme, it will be necessary for the insurance company to pass personal data (which may be sensitive personal data) back to the Company about your condition. It may also be necessary for the doctor treating you to confer with the Company GP so that the treating doctor can obtain appropriate authorisations (as required by the terms of any policy or otherwise) from the Company in relation to your treatment. By signing this Contract you give your consent for the Company GP to confer with a doctor treating you and for the insurance company to provide all relevant information to the Company in the circumstances outlined above.

9.0 TERMINATION

9.1 Suspension

At any time during your employment (including, but not limited to, during a period of notice of termination) the Company reserves the right to place you on suspension pending the outcome of any investigation or proceedings under the Company’s Disciplinary Procedure or otherwise. You shall be entitled to receive all basic pay (but not overtime) and other contractual benefits during such period of suspension.

9.2 Notice

If either party wishes to terminate your employment, the minimum notice period to be given by either party to the other shall be 6 months (or such longer statutory period of notice as may apply). Such notice shall be given in writing. If you wish to terminate your employment, such notice must be given by you to the Chief Executive of the Parent.

If you leave without giving the proper period of notice or leave during your notice period without permission, then (without prejudice to the Company’s right to claim back its losses from you sustained by virtue of you leaving early) the Company reserves the right to deduct a day’s pay for each day not worked during the notice period. This deduction may be made from any salary due or from any accrued holiday pay or other monies due to you.

9.3 Garden Leave

The Company shall not be obliged to provide you with work at any time after notice of termination has been given by either party and the Company may in its absolute discretion:-

a) require you to comply with such conditions as it may specify in relation to attending or remaining away from your work place and/or any other place of business of the Company and/ or Associated Company and/or any of its or their customers or clients including attending at the Company’s or Associated Company’s premises or the premises of any of its or their customers or clients for the purposes of the smooth handover of work and other responsibilities;

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b) assign you to such other duties as it shall in its absolute discretion determine and/or require you to work in a different team, department, project or area;

c) withdraw any powers vested in you or any duties assigned to you and require you to resign from any directorship or office that you may hold in the Company and/ or any Associated Company;

d) instruct you not to communicate orally or in writing on business issues with suppliers, customers, clients, employees, agents and/or representatives of the Company and/ or any Associated Company; and/ or

e) require you to take all or any outstanding holiday entitlement

provided always that in the exercise of any rights under (a) – (e) above, base salary and other contractual benefits shall not cease to be payable or provided. At all times, whether or not the Company exercises its rights under (a) to (e) above, you shall continue to owe duties of good faith and fidelity and a duty not to undermine the business of the Company.

9.4 Pay in Lieu of Notice

The Company reserves the right in its absolute discretion to terminate your employment lawfully by making a payment in lieu of notice and benefits, based on base salary only. The Company may make a payment in lieu of all or any part of your notice period.

9.5 Summary Dismissal

Nothing in this Contract prevents the Company from terminating your employment immediately and without notice or a payment in lieu in circumstances set out herein, in accordance with the Disciplinary Procedure or as permitted by law, including without limitation in circumstances where:-

you commit any act of dishonesty whether relating to the Company, any Associated Company or any of its or their employees or otherwise;

you are considered to be guilty of serious or persistent misconduct or any other conduct which, in the opinion of the board of directors of the Company, tends to bring you and/ or the Company and/ or any Associated Company into disrepute;

without reasonable cause you wilfully neglect or refuse to discharge your duties or to attend to the business of the Company and/ or any Associated Company;

in the opinion of the board of directors of the Company you fail to exercise reasonable skill and care in the performance of your duties;

you commit any act of gross misconduct;

you fail to perform your duties in accordance with the Company’s policies and procedures from time to time applicable;

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you materially breach the Foster Wheeler AG Code of Business Conduct and Ethics;

you commit any material breach of this Contract (other than a breach which (being capable of being remedied) shall be remedied forthwith by you at the request of the board of directors of the Company);

you are convicted of any criminal offence (excluding an offence under road traffic legislation in the United Kingdom or elsewhere for which you are not disqualified from driving for any period or sentenced to any term of imprisonment whether immediate or suspended);

in the opinion of the board of directors of the Company you are incapable of performing your duties due to alcohol or drugs;

you become bankrupt or make any arrangement or composition with your creditors generally;

you are disqualified from holding office in any company;

you resign as a Director of the Company or any Associated Company, except at the request of the Company or Associated Company; and/ or

you become of unsound mind or a patient under the Mental Health Act 1993.

Any delay by the Company in exercising its right to terminate your employment without notice shall not constitute a waiver of such right.

9.6 Severance Plan

You may be eligible to receive payments made under the Foster Wheeler AG Senior Executive Severance Plan (the “Severance Plan”), subject to the provisions of the Severance Plan, as may be amended from time to time.

9.7 Return of Property

Upon termination of your employment you must deliver to the Company in accordance with its instructions all correspondence, records, specifications, computer programs, software, disks, models, reports, notes, security badges, electronic equipment, instruments, books, reports and other publications and documents, standards, manuals, credit cards and club / associate membership cards and all other property belonging to the Company, any Associated Company and/or any of its/their customers, clients or partners which is in your possession, custody or control.

9.8 Company’s rights and remedies

Any termination of your employment shall be without prejudice to the Company’s rights and remedies to pursue you for breach of contract and as to the continuing nature of any ongoing obligations which subsist following termination.

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9.9 Expenses

Outstanding expense statements must be cleared to a zero balance before leaving, and any monies due to the Company from you (including but not limited to credit card balances and any outstanding loans) must be repaid in full. The Company reserves the right to make deductions of any sums payable by you to the Company from any monies owed to you.

10.0 MISCELLANEOUS PROVISIONS

10.1 Changes to the Contract

The Company may amend the terms of this Contract according to the needs of the business and will notify you at the earliest possible opportunity. Where an immediate change is necessary, the Company will notify you within a month of the change.

10.2 Collective Agreements

There are no collective agreements applicable to your employment which contain provisions directly affecting your terms and conditions of employment.

10.3 Notices

All notices, requests, consents and other communications required or permitted to be given hereunder shall be in writing and shall be deemed to have been duly given at the time of delivery if delivered personally, or two days after posting if sent by first class post, if to the Company, to the address specified in this Contract for the attention of the Chief Executive and if to you, to your principal residence as reflected in the records of the Company (or in either case to such other address as either party shall designate by notice in writing to the other).

10.4 Governing Law and Jurisdiction

This Contract is governed by and shall be construed in accordance with the laws of England and Wales and shall be subject to the exclusive jurisdiction of the English courts.

Signed:       /s/ Beth Sexton Date:   2 May 2013

For and on behalf of the Company

I hereby accept employment with the Company under the terms and conditions stated in this Contract.

Signature: /s/ Stephen Rostron Date:   26 April 2013

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APPENDIX 1

DATED

24 April 2013

CONFIDENTIALITY, INTELLECTUAL PROPERTY & POST-TERMINATION RESTRICTIONS AGREEMENT

between

FOSTER WHEELER MANAGEMENT LIMITED

and

STEPHEN ROSTRON

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THIS AGREEMENT is dated 24 April 2013

PARTIES

(1)     Foster Wheeler Management Limited, a company incorporated and registered in England and Wales with company number 05344191 whose registered office is at Shinfield Park, Reading, Berkshire RG2 9FW, UK (“Company”).

(2)     Stephen Rostron of 358 Lichfield Road, Four Oaks, Birmingham, West Midlands, B74 4BH.

(“Employee”).

BACKGROUND

(A)     The Employee is employed by the Company from 27 August 2013, most recently as Chief Compliance Officer under a contract dated 24 April 2013 (“Employment Contract”).

(B)     The parties have entered into this agreement to record and implement the terms on which they have agreed to ensure the adequate protection of the confidential information, intellectual property and goodwill of the Company and/or any Group Company.

(C)     The Company enters into this agreement for itself and as agent and trustee for all Group Companies and it is authorised to do so. It is the parties’ intention that each Group Company should be able to enforce any rights it has under this agreement, subject to and in accordance with the Contracts (Rights of Third Parties) Act 1999.

AGREED TERMS

1. INTERPRETATION

1.1 The definitions in this clause apply in this agreement.

Appointment: the employment of the Employee by the Company on the terms of the Employment Contract.

Board: the board of directors of the Company.

Capacity: as agent, consultant, director, employee, owner, partner, shareholder or in any other capacity.

Confidential Information: For purposes of this Agreement, “Confidential Information as used in this Agreement shall include the Company’s and/or the Group Company’s trade secrets, as well as any other information or material which is not generally known to the public, and which:

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(a) is generated, collected by utilized in the operations of the Company’s and/or the Group Company’s business and relates to the actual or anticipated business, research or development of the Company and/or the Group Company; or

(b) is suggested by or results from any task assigned to the Employee by the Company and/or the Group Company or work performed by the Employee for or on behalf of the Company and/or the Group Company.

Confidential Information shall not be considered generally known to the public if Employee or others improperly reveal such information to the public without the Company’s and/or the Group Company’s express written consent and/or in violation of an obligation of confidentiality to the Company and/or the Group Company. Examples of Confidential Information include, but are not limited to, all customer, client, supplier and vendor lists, budget information, contents of any database, contracts, product designs, technical know-how, engineering data, pricing and cost information, performance standards, productivity standards, research and development work, software, business plans, proprietary data, projections, market research, perceptual studies, strategic plans, marketing information, financial information (including financial statements), sales information, training manuals, employee lists and compensation of employees, and all other competitively sensitive information with respect to the Company and/or the Group Company, whether or not it is in tangible form, and including without limitation any of the foregoing contained or described on paper or in computer software or other storage devices, as the same may exist from time to time.

Copies: copies or records of any Confidential Information in whatever form (including, without limitation, in written, oral, visual or electronic form or on any magnetic or optical disk or memory and wherever located) including, without limitation, extracts, analysis, studies, plans, compilations or any other way of representing or recording and recalling information which contains, reflects or is derived or generated from Confidential Information.

Employment Inventions: any Invention which is made wholly or partially by the Employee at any time during the course of the Employee’s employment with the Company and/or any Group Company (whether or not during working hours or using the Company’s and/or Group Company’s premises or resources, and whether or not recorded in material form).

Employment IPRs: Intellectual Property Rights created by the Employee in the course of his or her employment with the Company and/or any Group Company (whether or not during working hours or using Company premises or resources).

Garden Leave: any period during which the Company has exercised its rights under clause 9.3 in the Employment Contract.

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Group Company: the Company, its Subsidiaries or Holding Companies from time to time and any Subsidiary of any Holding Company from time to time.

Holding Company: means “holding company” as defined in section 1159 of the Companies Act 2006.

Intellectual Property Rights: patents, rights to Inventions, copyright and related rights, trademarks, trade names and domain names, rights in get-up, goodwill and the right to sue for passing off, unfair competition rights, rights in designs, rights in computer software, database rights, topography rights, rights to use and preserve the confidentiality of information (including know-how and trade secrets) and any other intellectual property rights, in each case whether registered or unregistered and including all applications (or rights to apply) for and be granted, renewals or extensions of, and rights to claim priority from, such rights and all similar or equivalent rights or forms of protection which subsist or will subsist now or in the future in any part of the world.

Invention: For purposes of this Agreement, “Inventions” shall mean all software programs, source or object code, improvements, formulas, developments, ideas, processes, techniques, know-how, data, and discoveries, whether patentable or unpatentable, either conceived or reduced to practice by the Employee while in the Company’s and/or a Group Company’s employment, either solely or jointly with others, and whether or not during regular working hours, or conceived or reduced to practice by Employee within one year of the termination of Employee’s employment with the Company and/or any Group Company that resulted from Employee’s prior work with the Company and/or Group Company.

Pre-Contractual Statement: any undertaking, promise, assurance, statement, representation, warranty or understanding (whether in writing or not) of any person (whether party to this agreement or not) relating to the provisions under this agreement which is not expressly set out in this agreement or any documents referred to in it.

Restricted Business: the business of design, manufacture and erection of steam generating and auxiliary equipment for power stations and industrial facilities and the provision of aftermarket services related thereto, and the design, engineering, construction and project management of processing facilities and related infrastructure for the upstream oil & gas, LNG and gas-to-liquids, refining, chemicals and petrochemicals, power, mining and metals, environmental, pharmaceuticals, biotechnology and healthcare industries with which the Employee was involved to a material extent in the 12 months before Termination.

Restricted Customer: any firm, company or person who, during the 12 months before Termination, was a customer or prospective customer of OR in the habit of dealing with the Company and/or any Group Company with whom the Employee had contact or about whom the Employee became aware or informed in the course of their employment.

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Restricted Person: anyone employed or engaged by the Company and/or any Group Company who could materially damage the interests of the Company and/or any Group Company if they were involved in any Capacity in any business concern which competes with any Restricted Business and with whom the Employee dealt in the 12 months before Termination in the course of their employment.

Subsidiary: means “subsidiary” as defined in section 1159 of the Companies Act 2006.

Termination: the termination of the Employee’s employment with the Company howsoever caused.

1.2 The headings in this agreement are inserted for convenience only and shall not affect its construction.

1.3 A reference to a particular law is a reference to it as it is in force for the time being taking account of any amendment, extension, or re-enactment and includes any subordinate legislation for the time being in force made under it.

1.4 Unless the context otherwise requires, words in the singular include the plural and in the plural include the singular.

2. CONFIDENTIAL INFORMATION

2.1 Without prejudice to the Employee’s common law duties, the Employee shall not except in the proper course of the Employee’s duties, as authorised or required by law or as expressly authorised by the Company and/or the Group Company, either during the Appointment or at any time after Termination:

a) use any Confidential Information; or

b) make or use any Copies; or

c) disclose any Confidential Information to any person, company or other organisation whatsoever.

2.2 The restriction in clause 2.1 does not apply to any Confidential Information which is or comes into the public domain other than through the Employee’s unauthorised disclosure.

2.3 The Employee shall be responsible for protecting the confidentiality of the Confidential Information and shall:

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a) use their best endeavours to prevent the use or communication of any Confidential Information by any person, company or organisation (except in the proper course of their duties, as required by law or as authorised by the Company and/or the Group Company); and

b) inform the Board immediately on becoming aware, or suspecting, that any such person, company or organisation knows or has used any Confidential Information.

2.4 All Confidential Information and Copies shall be the property of the Company and/or relevant Group Company and on Termination, or at the request of the Company and/or the Group Company, at any time during the Appointment, the Employee shall:

a) immediately hand over to the Company or relevant Group Company all Confidential Information or Copies, any keys, credit cards and any other property of the Company and/or any Group Company and of any customer and/ or client of the Company and/or any Group Company;

b) irretrievably delete any Confidential Information stored on any magnetic or optical disk or memory, including personal computer networks, personal e-mail accounts or personal accounts on websites, and all matter derived from such sources which is in their possession or under their control outside the Company’s and/or Group Company’s premises; and

c) provide a signed statement that the Employee has complied fully with their obligations under this clause 2.4 together with such reasonable evidence of compliance as the Company and/or the Group Company may request.

2.5 Nothing in this clause 2 shall prevent the Employee from making a protected disclosure within the meaning of section 43A of the Employment Rights Act 1996.

3. INTELLECTUAL PROPERTY

3.1 The Employee acknowledges that all Employment IPRs, Employment Inventions and all materials embodying them shall automatically belong to the Company and/or relevant Group Company to the fullest extent permitted by law. To the extent that they do not vest in the Company and/or relevant Group Company automatically, the Employee holds them on trust for the Company and/or relevant Group Company.

3.2 The Employee acknowledges that, because of the nature of their duties and the particular responsibilities arising from the nature of their duties, the Employee has, and shall have at all times while the Employee is employed by the Company, a special obligation to further the interests of the Company and/or relevant Group Company.

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3.3 To the extent that legal title in any Employment IPRs or Employment Inventions does not vest in the Company and/or relevant Group Company by virtue of clause 3.1, the Employee agrees, immediately on creation of such rights and Inventions, to offer to the Company and/or relevant Group Company in writing a right of first refusal to acquire them on arm’s length terms to be agreed between the parties. If the parties cannot agree on such terms within 30 days of the Company and/or relevant Group Company receiving the offer, the Company and/or relevant Group Company shall refer the dispute for determination to a mutually agreed expert, provided, that where the parties cannot agree on an expert within 14 days, the Company shall appoint the expert. The expert’s decisions shall be final and binding on the parties in the absence of manifest error, and the costs paid to the arbitration body shall be borne equally by the parties. The parties will be entitled to make submissions to the expert and will provide (or procure that others provide) the expert with such assistance and documents as the expert reasonably requires for the purpose of reaching a decision. The Employee agrees that the provisions of this clause 3 shall apply to all Employment IPRs and Employment Inventions offered to the Company and/or relevant Group Company under this clause 3.3 until such time as the Company and/or relevant Group Company has agreed in writing that the Employee may offer them for sale to a third party.

3.4 The Employee agrees

a) to give the Company and/or relevant Group Company full written details of all Employment Inventions which relate to or are capable of being used in the business of the Company and/or any Group Company promptly on their creation;

b) at the Company’s and/or relevant Group Company’s request and in any event on the termination of the Employee’s employment to give to the Company and/or relevant Group Company all originals and copies of correspondence, documents, papers and records on all media which record or relate to any of the Employment IPRs;

c) not to attempt to register any Employment IPR or patent any Employment Invention unless requested to do so by the Company and/or relevant Group Company; and

d) to keep confidential each Employment Invention unless the Company and/or relevant Group Company has consented in writing to its disclosure by the Employee.

3.5 The Employee waives all their present and future moral rights which arise under the Copyright Designs and Patents Act 1988, and all similar rights in other jurisdictions relating to any copyright which forms part of the Employment IPRs, and agrees not to support, maintain or permit any claim for infringement of moral rights in such copyright works.

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3.6 The Employee acknowledges that, except as provided by law, no further remuneration or compensation is or may become due to the Employee in respect of their compliance with this clause. This clause is without prejudice to the Employee’s rights under the Patents Act 1977.

3.7 The Employee undertakes to use their best endeavours to execute all documents and do all acts both during and after their employment by the Company as may, in the opinion of the Company and/or relevant Group Company, be necessary or desirable to vest the Employment IPRs in the Company and/or relevant Group Company, to register them in the name of the Company and/or relevant Group Company and to protect and maintain the Employment IPRs and the Employment Inventions. Such documents may, at the Company’s and/or relevant Group Company’s request, include waivers of all and any statutory moral rights relating to any copyright works which form part of the Employment IPRs. The Company and/or relevant Group Company agrees to reimburse the Employee’s reasonable expenses of complying with this clause 3.7.

3.8 The Employee agrees to give all necessary assistance to the Company and/or relevant Group Company to enable it to enforce its Intellectual Property Rights against third parties, to defend claims for infringement of third party Intellectual Property Rights and to apply for registration of Intellectual Property Rights, where appropriate throughout the world, and for the full term of those rights.

3.9 The Employee hereby irrevocably appoints the Company and/or relevant Group Company to be their attorney in their name and on their behalf to execute documents, use the Employee’s name and do all things which are necessary or desirable for the Company and/or relevant Group Company to obtain for itself or its nominee the full benefit of this clause. The Employee acknowledges that a certificate in writing, signed by any director or the secretary of the Company, that any instrument or act falls within the authority conferred by this agreement shall be conclusive evidence that such is the case so far as any third party is concerned.

4. POST-TERMINATION RESTRICTIONS

4.1 In order to protect the Confidential Information and business connections of the Company and/or each Group Company to which the Employee has access or with whom he has had dealings as a result of the Appointment, the Employee covenants with the Company (for itself and as trustee and agent for each Group Company) that the Employee shall not

a) For 12 months after Termination, solicit or endeavour to entice away from the Company and/or any Group Company the business or custom of a Restricted Customer with a view to providing goods or services to that Restricted Customer in competition with any Restricted Business;

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b) For 12 months after Termination in the course of any business concern which is in competition with any Restricted Business, offer to employ or engage or otherwise endeavour to entice away from the Company and/or any Group Company any Restricted Person;

c) For 12 months after Termination in the course of any business concern which is in competition with any Restricted Business, employ or engage or otherwise facilitate the employment or engagement of any Restricted Person, whether or not such person would be in breach of contract as a result of such employment or engagement;

d) For 12 months after Termination, be involved in any Capacity with any business concern which is (or intends to be) in competition with any Restricted Business;

e) For 12 months after Termination, be involved with the provision of goods or services to (or otherwise have any business dealings with) any Restricted Customer in the course of any business concern which is in competition with any Restricted Business; or

f) at any time after Termination, represent himself/ herself as connected with the Company and/or any Group Company in any Capacity, other than as a former employee, or use any registered names or trading names associated with the Company and/or any Group Company.

4.1 Because of the international nature of the Company’s and/or Group Company’s business, the above restrictions apply in the USA, the UK and any other jurisdiction where the Employee has worked prior to or is working for the Company or any Group Company immediately before Termination.

4.2 Notwithstanding anything to the contrary, nothing in this clause 4 prohibits the Employee from being a passive owner of not more than five percent (5%) of the outstanding stock of any class of a corporation which is publicly traded, so long as the Employee has no active participation in the business of such corporation.

4.3 The restrictions imposed on the Employee by this clause 4 apply to the Employee acting:

a) directly or indirectly; and

b) on the Employee’s own behalf or on behalf of, or in conjunction with, any firm, company, person or other organisation.

4.4 The periods for which the restrictions in clause 4.1 apply shall be reduced by any period that the Employee spends on Garden Leave immediately before Termination.

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4.5 If the Employee receives an offer to be involved in a business concern in any Capacity during the Employment, or before the expiry of the last of the covenants in this clause 4, the Employee shall give the person making the offer a copy of this clause 4 and shall notify the Company and/or the Group Company of the identity of that person as soon as possible after accepting the offer.

4.6 The Employee confirms that prior to entering into the restrictions in this clause 4 they had an opportunity to take independent legal advice.

4.7 Each of the restrictions in this clause 4 is intended to be separate and severable. If any of the restrictions shall be held to be void but would be valid if part of their wording were deleted, such restriction shall apply with such deletion as may be necessary to make it valid or effective.

4.8 If the Employee’s employment is transferred to any firm, company, person or entity other than a Group Company (“New Employer”) pursuant to the Transfer of Undertakings (Protection of Employment) Regulations 2006, the Employee will, if required, enter into an agreement with the New Employer containing post-termination restrictions corresponding to those restrictions in this clause 4, protecting the confidential information, trade secrets and business connections of the New Employer.

4.9 The Employee will, at the request and expense of the Company, enter into a separate agreement with any Group Company in which the Employee agrees to be bound by restrictions corresponding to those restrictions in this clause 4 (or such of those restrictions as may be appropriate) in relation to that Group Company.

5. INJUNCTIVE RELIEF, REMEDIES AND ATTORNEYS FEES

5.1 The Employee recognises that their violation of this agreement could cause the Company and/or any Group Company irreparable harm, the amount of which may be extremely difficult to estimate, making any remedy at law or in damages inadequate. Thus, the Employee agrees that the Company and/or any Group Company shall have the right to apply to any court of competent jurisdiction for an order restraining any breach or threatened breach of this agreement and for any other relief the Company and/or any Group Company deems appropriate. This right shall be in addition to any other remedy available to the Company and/or any Group Company. Should the Company and/or the Group Company successfully enforce any portion of this agreement or obtain judgment against the Employee for a breach of this agreement before a court of competent jurisdiction, it shall be entitled to receive and recover from the Employee all of its reasonable attorney’s fees, litigation expenses and costs incurred as a result of enforcing this agreement and/ or obtaining judgment against the Employee.

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5.2 If the Employee breaches any material provision of this agreement or pursues a claim against the Company and/or any Group Company in any country or jurisdiction arising out of the terms of this agreement or otherwise, the Employee agrees to indemnify the Company and/or the Group Company for any losses suffered as a result thereof, including but not limited to the repayment of any severance pay and benefits provided over and above the Employee’s contractual and statutory entitlement by the Company and/or any Group Company including any payments made under any severance plan and all reasonable legal and professional fees incurred.

6. ENTIRE AGREEMENT

a) This agreement and any document referred to in it constitutes the whole agreement between the parties (and in the case of the Company, as agent for any Group Companies) and supersedes all previous discussions, correspondence, negotiations, arrangements, understandings and agreements between them in relation to the terms of this agreement.

b) Each party acknowledges that in entering into this agreement it has not relied on and shall have no remedy in respect of any Pre-Contractual Statement.

c) Nothing in this agreement shall limit or exclude any liability for fraud.

7. VARIATION

No variation or agreed termination of this agreement shall be effective unless it is in writing and signed by the parties (or their authorised representatives).

8. SEVERABILITY

Each clause and sub-clause in this agreement is intended to be separate and severable. If any clause or sub-clause shall be held to be void but would be valid if part of their wording were deleted, such clause or sub-clause shall apply with such deletion as may be necessary to make it valid or effective.

9. COUNTERPARTS

This agreement may be executed in any number of counterparts, each of which, when executed and delivered, shall be an original, and all the counterparts together shall constitute one and the same instrument.

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10. THIRD PARTY RIGHTS

The Contracts (Rights of Third Parties) Act 1999 shall only apply to this agreement in relation to any Group Company and no person other than the Employee, the Company and any Group Company shall have any rights under it. The terms of this agreement may be varied, amended or modified or this agreement may be suspended, cancelled or terminated by agreement in writing between the parties or this agreement may be rescinded (in each case), without the consent of any third party.

11. GOVERNING LAW AND JURISDICTION

a) This agreement and any dispute or claim arising out of or in connection with it or its subject matter or formation (including non-contractual disputes or claims) shall be governed by and construed in accordance with the law of England and Wales.

b) The parties irrevocably agree that the courts of England and Wales shall have exclusive jurisdiction to settle any dispute or claim that arises out of or in connection with this agreement or its subject matter or formation (including non-contractual disputes or claims).

This agreement has been entered into on the date stated at the beginning of it.

Signed:       /s/ Beth Sexton Date:   2 May 2013

For and on behalf of the Company

Signature: /s/ Stephen Rostron Date:   26 April 2013

Stephen Rostron

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EX-10.2

Exhibit 10.2

Mr J Nield

The New Barn

2 Batts Farmyard

Wilton

Marlborough

SN8 3SS

Dear Jon

EFFECTIVE DATE OF EMPLOYMENT CONTRACT DATED 19 SEPTEMBER 2013

I confirm that the agreed effective date of your contract of employment dated 19 September 2013 is 2nd May 2013.

This contract replaces all other contracts of employment between you, the Company or any Associated Company.

Yours sincerely

/s/ Beth B. Sexton

For and on behalf of the Company

Signature:	/s/ J C Nield
	Jon Nield

Foster Wheeler Management Limited	Tel: +44 118 913 1234
Shinfield Park	Fax: +44 118 913 2333
Reading RG2 9FW UK	www.fwc.com

CONTRACT OF EMPLOYMENT

between

FOSTER WHEELER MANAGEMENT LIMITED a company registered in England and Wales with company number 05344191 and whose registered office is at Shinfield Park, Shinfield, Reading, Berkshire RG2 9FW (the “Company”);

and

JON NIELD (“you”)

This Contract of Employment is dated 19 September 2013. Its terms will take effect from the date set out in writing to you.

You should read the entire document carefully as it creates legally binding obligations.

TERMS AND CONDITIONS OF EMPLOYMENT

This Contract of Employment (the “Contract”), together with any documents referred to in it (except as notified otherwise), including but not limited to the Confidential Information, Intellectual Property and Post-Termination Restrictions Agreement which is appended hereto and which will be signed by the Employee, contains the entire agreement and understanding between you and the Company and supersedes any prior agreements regarding your employment by the Company (including but not limited to any previous contract of employment between you and any Associated Company) which shall be deemed to have been terminated by mutual consent, save as otherwise confirmed to you.

Notwithstanding the above, and for the avoidance of doubt, this Contract shall not supersede or otherwise adversely affect (i) any stock option, restricted stock or other form of equity grant or award provided to you prior to the date of this Contract or (ii) any indemnification agreement heretofore entered into between you and the Company or any Associated Company, (iii) the Confidential Information and Non-Competition Agreement dated 19 September 2013 (as amended) or (iv) the Patent & Secrecy Agreement dated 19 September 2013 provided, however, that in the event of a direct conflict between the terms of this Contract and any of the foregoing documents, this Contract shall prevail.

1.0 DEFINITIONS

1.1 The definitions in this clause apply in this Contract.

“Associated Company” means (unless otherwise stated in this Contract) any company which is a direct or indirect subsidiary, subsidiary undertaking or holding company of the Company or any subsidiary or subsidiary undertaking of any such holding company and further includes but is not limited to Foster Wheeler AG and any direct or indirect subsidiary of it (and “Associated Companies”) shall be construed accordingly.

The expressions “subsidiary” and “holding company” shall have the meanings ascribed to them by the Companies Act 2006 as amended (Section 1159) and the expression “subsidiary undertaking” shall have the meaning ascribed to it by the same Act.

“Board” means the Board of Directors of the Parent.

“Committee” means the Compensation and Executive Development Committee of the Board.

“Company GP” means the occupational health professional designated and communicated as the Company GP from time to time.

“Foster Wheeler Group” means all the subsidiary companies (from time to time) of the Parent and any affiliate companies identified as part of the Group from time to time.

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“Parent” means Foster Wheeler AG or such other company as may be amended from time to time.

“STI Programme” means the Foster Wheeler Annual Executive Short Term Incentive Plan as may be amended or replaced from time to time.

1.2 The headings in this agreement are inserted for convenience only and shall not affect its construction.

1.3 A reference to a particular law is a reference to it as it is in force for the time being taking account of any amendment, extension, or re-enactment and includes any subordinate legislation for the time being in force made under it.

1.4 Unless the context otherwise requires, words in the singular include the plural and in the plural include the singular.

2.0 STANDARD TERMS

2.1 Conditions

You represent that by virtue of entering into this Contract and holding any directorships of the Company and any Associated Company you will not be in breach of any express or implied terms of any contract with or of any other obligation to any third party binding upon you.

This Contract is contingent upon you having the right to live and work in the UK or such other location at which you may be permanently based and carrying out your responsibilities pursuant to this Contract.

2.2 Term

The terms and conditions in this Contract will take effect on and from the date set out in writing to you (the “Start Date”).

Your period of continuous employment started on 1 September 1986.

Your employment shall continue, subject to the terms of this Contract, until terminated in accordance with section 9 below.

2.3 Job Title and Duties

Your position is Vice President, Project Risk Management. You will report to the Chief Executive Officer of Foster Wheeler AG or his/her designated representative. The Company may from time to time second or assign you to work under the direction and control of any Associated Company globally (whether in relation to a specific project or otherwise). In no circumstances shall your title or service as an officer or director of any Associated Company (including but not limited to the Parent) be deemed to create an employment relationship with such Associated Company, unless otherwise expressly agreed by the Parent and/ or the Company as appropriate.

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By signing this Contract, you agree and consent that where the need arises, the Company may require you to undertake duties or jobs outside the normal scope of your position. Where this need arises the Company shall inform you of the change. In exceptional circumstances this may include a post of a higher or lower grade: any proposal to change your post in this way will be discussed with you beforehand.

During the period of employment you are required, and agree, to:-

devote the whole of your time, attention and ability during your hours of work to carrying out your duties solely for the Company or any Associated Company that you are assigned to from time to time;

perform such duties as may be required from time to time for the Company or any Associated Company or for any of its or their customers or clients;

comply with all instructions given to you by the Company or any Associated Company, whether given verbally or in writing, and whether contained in policies or procedures or otherwise, and if so instructed comply with all instructions given by any customer or client of the Company or any Associated Company to the extent that they do not conflict with any instructions given to you by the Company or Associated Company;

keep the board of directors of the Company at all times, and the Board and any Associated Company as applicable upon request, promptly and fully informed (in writing if so requested) of your conduct of the business or affairs of the Company and any Associated Company and provide such explanations as it may require;

exercise such powers in relation to the conduct and management of the affairs of the Company and any Associated Company as may be assigned to or vested in you from time to time by the Company or the Parent or their designates (as appropriate) as shall be consistent with your position and at all times conform to their lawful and reasonable directions;

faithfully, dilligently and to the best of your abilities serve the Company and any Associated Company;

use your best endeavours to promote the interests of the Company and any Associated Company; and

not do anything to undermine the business or reputation of the Company or any Associated Company.

2.4 Place of Work

Your normal place of work is Reading and you agree to keep a residence within a reasonable daily commute of your normal place of work. However, the Foster Wheeler Group is a global organisation with other locations and Associated Companies and affiliates worldwide and in the UK. Consequently, the Company reserves the right to require you to work at another location within the UK where reasonably necessary for the performance of your duties or in the interests of the business. You may also be required to travel for business purposes, although it is not anticipated that any such trip outside the UK would last for a period exceeding a month. The Company will endeavour to consult with you about any proposed changes to your work location. You may also be required to work from home during business hours where the Company considers it appropriate.

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2.5 Business Trips

While on a business trip, you are required to comply with any applicable Company or corporate travel policy, work practice, project or local travel policy or other guidance or rules.

2.6 Working Hours and Overtime

Your core working hours are 40 hours per week.

The number of hours per week that you are required to work and the scheduling of those hours may be amended from time to time without notice to meet client and management requirements. You may be expected to work hours in excess of your normal working week where this is necessary for the proper performance of your duties and where this is reasonably required by the Company to meet business needs.

The Company believes that having regard to your position, the limits on working time imposed by the Working Time Regulations 1998 (as amended if applicable) do not apply. However, in signing this Contract you agree in any event that you will if reasonably required by the Company work hours in excess of an average 48 hours per week as defined by the Working Time Regulations 1998, and that the average weekly limit set out in regulation 4(1) of the Working Time Regulations 1998 shall not apply to your employment, subject to your right to withdraw this consent at any time by giving three months’ written notice.

2.7 Remuneration and Expenses

Your annual gross base salary (which shall be subject to deductions for income tax and national insurance contributions as required by law) is £179,637 (one hundred and seventy nine thousand, six hundred and thirty seven pounds) payable monthly.

Any change in your salary will be notified to you in writing. Salary reviews are carried out entirely at the Company’s discretion and the Company shall be under no obligation to increase your salary as part of any review. Salary reviews are also subject to the approval of the Committee which shall be exercised at the Committee’s absolute discretion. Your next salary review will occur during the first quarter of 2014.

You will be reimbursed for any reasonable expenses properly incurred by you while performing your duties on behalf of the Company (and any Associated Company), provided that you produce receipts in support of and detailing such expenses when submitting your claim, and subject to your compliance with any rules, policies and procedures of the Company (or any Associated Company as applicable) relating to reimbursement of expenses.

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3.0 BENEFITS

3.1 Short Term Incentive (“STI”) Plan

You may be eligible during your employment to participate, as determined by the Board of Directors of the Parent (the “Board”) or the Compensation and Executive Development Committee (the “Committee”) of the Board in their absolute discretion and in accordance with any relevant policies, applicable law, or exchange listing requirements, in the Parent annual STI programme as in effect from time to time for senior executives.

You shall be eligible for an annual STI award at a target opportunity of fifty percent (50%) of your annual gross base salary (with payouts ranging from zero (0) to two times (2x) your target opportunity) based on achievement of certain objectives established in advance by the Company, the Board and/or the Committee and/ or their designate as necessary or appropriate to comply with relevant policies, applicable law, or exchange listing requirements. The actual amount of STI shall be determined by and in accordance with terms of the STI programme (as amended from time to time) and you shall have no absolute right to participate in the STI in any year.

3.2 Long-Term Incentive (“LTI”)

You shall be eligible during your employment for annual equity awards, as determined by the Board and/or the Committee as necessary or appropriate to comply with Company policy, applicable law, or exchange listing requirements, under the equity or LTI plan for senior executives, as in effect from time to time. The LTI plan currently in place is the Omnibus Plan. The actual amount of any LTI awards shall be determined by and in accordance with the terms of the then-current LTI award plan or programme by the Company, the Board, and/or the Committee in their absolute discretion, and you shall have no absolute right to an LTI award in any year.

3.3 Company Car Cash Allowance

You are eligible for a company car cash allowance of £14,400 per annum payable in monthly instalments with your salary payments. It will be separate from your salary and will be subject to tax and employee National Insurance contributions. It will not constitute pensionable earnings.

Provided that you hold a current driving licence you will be required to use your own car for road network business travel within the UK unless otherwise authorised by your manager. You must therefore insure your car for business use and ensure that it is well maintained, roadworthy and has a valid MOT certificate as applicable.

The enclosed cash allowance information sheet contains important information about the company car cash allowance. By signing this Contract, you indicate that you have read and understood this information. Please note that this information does not form part of your contract of employment and will be changed from time to time. Changes may be made without notice.

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3.4 Private Healthcare Plan

The Company will bear the reasonable costs of membership of a private healthcare plan for your benefit.

Membership of the plan is subject to the terms of the plan and the rules or insurance policy of the plan provider, in each case as may be amended from time to time, and is subject always to the plan provider’s willingness to provide cover. It is a taxable benefit. You may be able to purchase additional cover for your partner and any eligible dependent children.

3.5 Pension

You will remain a member of the Foster Wheeler Pension Plan.

No contracting out certificate under the Pensions Schemes Act 1993 (as amended as applicable) is in force in respect of your employment with the Company.

3.6 Other Benefits

Subject to eligibility, you may be able to participate in certain insurance or other schemes as may be made available to you by the Company or an Associated Company from time to time. If you do participate in any such insurance schemes, and whether the particular scheme is contractual or non-contractual, payments will be made to you only insofar as the terms of the applicable Company/ Associated Company policy provides for cover and (where cover under the scheme is provided by an external organisation) where the applicable insurance policy provides for and pays for cover. The Company reserves the right in its sole and absolute discretion to discontinue, vary or amend the benefits provided at any time on reasonable notice to you.

3.7 Deductions

The Company will be entitled, at any time, to deduct from any salary or other remuneration due to you any monies that may be due and owing to the Company or any Associated Company (if applicable), including without limitation any overpayment, transitional payments, advances or loans made to you by the Company and/or any Associated Company, pay received for holiday taken in excess of pro rata entitlement or during periods of unauthorised absences, excess of commission paid and advance payments for anticipated expenses in excess of those expenses actually incurred.

Where any property or money belonging to the Company or any Associated Company or any client, customer, visitor, employee or agent of the Company or any Associated Company is lost or damaged through dishonesty on your part, or because of your serious or persistent negligence or recklessness or through any serious or persistent breach of the Company’s or any Associated Company’s rules, the Company reserves the right to require you to pay for any such loss or damage by a deduction from salary or other payments due to you from the Company.

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By signing this Contract you accept the Company’s right to make such deductions. If the Company (or Associated Company as applicable) is unable, for whatever reason, to recoup monies due by making deductions, then it reserves its rights to pursue such repayment by other means, including through civil legal action.

3.8 Personal Indemnity

You shall indemnify the Company on a continuing basis in relation to any income tax and National Insurance contributions (save for employers’ National Insurance contributions), including any related interest, penalties, costs and expenses, which may be incurred by the Company if any exemptions applied under this contract of employment do not apply.

4.0 HOLIDAYS

You shall be entitled to 30 days paid holiday per annum

Full time employees are also entitled to 8 public and other statutory holidays in England and Wales per annum.

The Company’s holiday year runs from 1st January to 31st December.

In some circumstances the Company or any Associated Company may direct you to take holiday on specific days, such as during the Christmas period. You will be notified if you need to keep aside any leave to cover such periods as this will vary each year and will depend upon whether your employment continues over such periods. There is no extra leave entitlement to cover the Christmas period.

You are not permitted to carry over unused holiday from one holiday year to the next without the prior approval of your line manager or his/ her designated representative, which will normally only be given in exceptional circumstances. For your welfare, two weeks of holiday must be taken as complete weeks of holiday. This may be either one fortnight or two separate weeks. No payment in lieu will be made for holiday not taken in any holiday year (except on termination of employment). In the interests of business efficiency not more than 3 consecutive weeks of holiday will normally be permitted.

The Company will try to accommodate holidays being taken on the dates requested. Where business demands make taking holiday difficult, this will be dealt with on an individual basis.

Upon termination of your employment for any reason you shall be entitled to payment in lieu on a pro rata basis for any holidays not taken which have accrued in the holiday year in which the date of termination falls. Upon termination of employment for any reason (including where you are dismissed summarily for gross misconduct) you shall repay the Company, or have deducted from your final salary or any other payments due to you, any salary received in respect of holiday taken prior to the date of termination in excess of your proportionate entitlement. Any payment in respect of accrued but untaken holiday, or overpaid holiday, is calculated at the daily rate of 1/260^th of your annual base salary (pro- rated as appropriate for part- time staff). The Company

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may, at its absolute discretion, require you to take holiday entitlement during your notice period. If your last day of employment is on or after the 15th of the month you will be entitled to the pro rata amount of holiday entitlement for that month. You will not be entitled to a payment in respect of any holiday accrued but untaken on termination if you refuse to take such holiday entitlement during the notice period.

Further information on holiday entitlement can be found in the relevant Company policy.

5.0 SICKNESS

5.1 Sick Pay

If you are absent from work due to sickness or injury and subject to your compliance with the provisions relating to sickness absence notification and proof of incapacity as set out in the Sick Leave and Sickness Absence Notification policy (which is available on the Company’s intranet), the Company may at its sole and absolute discretion, pay you sick pay, based on your normal basic salary and your years of continuous service with the Company and any Associated Company and based on the following table:

Length of service at start of sickness/ injury absence	Maximum number of days for which Company sick pay (to include any entitlement to statutory sick pay) may be paid for a full time employee normally working 40 hours per week, to be pro- rated for part time employees
Up to 1 year exactly	20 working days at basic salary
Over 1 year and up to 2 years exactly	40 working days at basic salary
Over 2 years and up to 3 years exactly	60 working days at basic salary
Over 3 years	60 working days at basic salary followed by 60 working days at half basic salary

The payments given above are the normal maximum sick pay payments that will be paid in any rolling 12 month period and apply whether the periods of absence are continuous or intermittent. They are inclusive of any entitlement that you may have in that period to any statutory or legally mandated sick pay.

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Any further payments of Company sick pay above the limits stated above shall be at the Company’s sole and absolute discretion.

5.2 Cessation of employment

If you are unable to perform your duties through sickness or injury for a period of 26 consecutive weeks or for periods aggregating 26 weeks in any period of 52 weeks, the Company shall be entitled to terminate your employment on notice.

5.3 Unauthorised Absence

The Company reserves the right to withhold payment of or deduct from your salary one day’s pay for each day of unauthorised absence from work. “Unauthorised absence” means failure to report to work unless this is due to genuine sickness or injury notified to the Company in accordance with Company procedures, leave for which permission has been granted by your manager, or genuine reasons outside your control which are acceptable to the Company and agreed by your manager

5.4 Medical Examination

The Company may on reasonable notice require you to undergo medical examinations undertaken by a registered medical practitioner nominated by the Company and at the Company’s expense at any time. Subject to the normal legal provisions, the medical practitioner may disclose to and discuss with the Company or any Associated Company, on a confidential basis, the results of the examination and the matters which arise from it where this information or any medical condition affects or may affect your ability to perform your job properly or affects or may affect your sick pay entitlement in any way.

6.0 DIRECTORSHIPS

It is usual practice for the Company to nominate appropriate employees to serve on the boards of companies, in which the Foster Wheeler Group has shareholdings, including Associated Companies. In England and Wales, directors of companies have duties and responsibilities that are specified in part in legislation and in part in the relevant Articles of Association. Such obligations and responsibilities which derive from holding office as a director are separate to the terms of your employment with the Company. All directors have a duty to declare their other directorships, relevant shareholdings, and interest in material contracts. Further information about directors’ obligations can be obtained from the relevant company’s Secretary.

By entering into this agreement, you agree that if you are appointed as a director and/ or officer of the Company and/ or any of its Associated Companies you will comply with all associated duties, whether applicable in England and Wales or otherwise, including but not limited to any applicable duties or requirements as an officer under the Companies Act 2006 (as amended) (in the United Kingdom) and section 16 of the Securities Exchange Act of 1934 (as amended) (in the United States of America).

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You further agree that at any time during your employment at the request of the Company or any Associated Company in relation to which you hold a directorship, and immediately on termination of your employment for whatever reason, you will resign from all offices held in the Company and any Associated Company (as applicable) (without prejudice to the rights of any party arising out of this Contract or the termination of your employment) without any compensation for loss of office and resign from membership of any association acquired exclusively by reason of or in connection with your employment. Should you fail to resign from such offices in accordance with this provision, the Company and/ or any Associated Company is irrevocably authorised to appoint a person in your name and on your behalf to sign a document or do anything necessary or requisite to bring about the appropriate resignation. You hereby irrevocably appoint the Company to be your attorney to execute and do any such instrument or thing and generally to use your name for the purpose of giving the Company or its nominee the full benefit of this clause.

7.0 CONFIDENTIALITY, CONFLICTS AND INTELLECTUAL PRPOPERTY RIGHTS

7.1 Conflict of Interests

You must not, without the prior written consent of the Company in any way directly or indirectly, alone or jointly, in any capacity whatsoever:-

1. be engaged or employed in or by;

2. be concerned with;

3. be interested in; and/ or

4. provide services to

any other business, individual, firm, company or other organisation where this is, or is likely to be, in conflict with the interests of the Company, and/or those of any Associated Company and/or those of any of its/their clients or customers and/or where this may adversely affect the efficient and proper discharge of your duties, including but not limited to any other individual, business, firm, company or other organisation which is a supplier to or customer of the Company or any Associated Company or which is wholly or partly in competition with the business carried on by the Company and/ or any Associated Company.

If you undertake other work during your normal working hours or use Company or Associated Company equipment for purposes other than the Company’s or Associated Company’s business, this will normally be treated as gross misconduct and could lead to dismissal.

If you wish to lecture, give talks or public speeches, publish material in any form, or release information on matters related to or arising from your employment with the Company or any Associated Company, you must obtain prior written agreement from the Company.

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If you wish to take office in a public or professional body or take employment outside your core working hours you must obtain prior written agreement from the Company.

You agree that you will not during your employment with the Company or in consequence of your employment directly or indirectly receive or accept any commission, discount, service or other benefit, gift or payment in respect of any business transacted by or on behalf of the Company or any Associated Company. You further agree that if you do receive any such benefit, gift or payment you will immediately disclose it and account for it to the Company.

Notwithstanding anything to the contrary, nothing in this clause 7 prohibits the Employee from being a passive owner of not more than five percent (5%) of the outstanding stock of any class of a corporation which is publicly traded, so long as the Employee has no active participation in the business of such corporation.

You shall comply where relevant with every rule of law, every regulation of The International Stock Exchange of the United Kingdom and Republic of Ireland, every regulation of the stock exchange where the Parent’s shares are traded and every regulation of the Company and/ or any Associated Company from time to time in force in relation to dealings in shares, debentures or other securities of the Company and/ or any Associated Company and unpublished price sensitive information affecting such shares, debentures or other securities. In relation to overseas dealings you shall also comply with all laws of the state and all regulations of the stock exchange, market or dealing system in which such dealings take place.

You shall not at any time make any untrue or misleading statement in relation to the Company and/ or any Associated Company.

For the purposes of this Contract, “Recognised Investment Exchange” means any body of persons which is for the time being a Recognised Investment Exchange for the purposes of the Financial Services and Markets Act 2000 (as amended).

By accepting employment and signing this Contract of Employment with the Company you represent and warrant to the Company:-

(i) that you are not party to any restrictive covenant or agreement that would preclude you from accepting employment with the Company and performing your duties as set out herein; and

(ii) that all of the information that you have provided to the Company in its review of you is true, correct and complete in all material respects.

7.2 Procedures

The Company has a number of policies and procedures (including those which apply in relation to assignments to Associated Companies) which are available on the Company’s intranet site. You are required to adhere to these documents (as may be amended from time to time) during and, in certain cases, after your employment with the Company. You are responsible for ensuring that you are familiar with and understand them and any amendments which may be made time to time. Please note that if you breach any policies and procedures this may be a disciplinary offence and could ultimately result in dismissal. These policies and procedures do not form part of your Contract unless they state otherwise.

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7.3 Foster Wheeler AG Code of Business Conduct and Ethics

You will be bound by the Foster Wheeler AG Code of Business Conduct and Ethics. Breach of the Foster Wheeler AG Code of Business Conduct and Ethics may constitute misconduct or gross misconduct and result in disciplinary proceedings being taken, which could ultimately result in dismissal.

7.4 Disciplinary, Capability, Appeals and Grievance Procedures

The Company Disciplinary, Capability, Appeals and Grievance procedures which apply to your employment can be found on the Company intranet site. They specify the individuals to whom Grievances and Appeals should be addressed. These procedures do not form part of your Contract and may be amended from time to time.

7.5 Confidentiality, Intellectual Property and Post-Termination Restrictions

At the same time as entering into this Agreement you will execute the Confidentiality, Intellectual Property and Post-Termination Restrictions Agreement which is appended at Appendix 1 hereto.

8.0 PERSONAL DATA

By signing this Contract you confirm that you will comply with the Company’s policies, procedures and guidelines on handling data (which may be amended from time to time) including but not limited to when processing personal data in the course of employment including personal data relating to any employee, customer, client, supplier or agent of the Company or any Associated Company.

You consent to the Company and/ or any Associated Company processing data relating to you (and your dependants) for legal, personnel, administrative and management purposes and in particular to the processing of any sensitive personal data (as defined in the Data Protection Act 1998) relating to you, including, as appropriate:

information relating to your physical or mental health or condition in order to monitor sick leave and take decisions as to your fitness for work;

your racial or ethnic origin or religious or similar information in order to monitor compliance with equal opportunities legislation;

information relating to any criminal proceedings in which you have been involved for insurance purposes and in order to comply with legal requirements and obligations to third parties.

The Company may make such information available to any Associated Company, those who provide products or services to the Company or any Associated Company (such as advisers, financial and taxation consultants and payroll administrators), regulatory authorities, potential or future employers, governmental or quasi-governmental organisations, clients and potential purchasers of the Company, Parent and/or the business in which you work.

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You consent to the transfer of such information to any Associated Company and the Company’s and/ or Associated Company’s business contacts outside the European Economic Area in order to further their business interests. Where your personal data is passed to any third party the Company will take all reasonable steps to ensure that it is held securely and used only for the purposes for which it is supplied.

The Company currently offers an insurance scheme to provide insurance cover for employees whilst undertaking business trips. If you have an illness or accident which requires the assistance of the insurance scheme, it will be necessary for the insurance company to pass personal data (which may be sensitive personal data) back to the Company about your condition. It may also be necessary for the doctor treating you to confer with the Company GP so that the treating doctor can obtain appropriate authorisations (as required by the terms of any policy or otherwise) from the Company in relation to your treatment. By signing this Contract you give your consent for the Company GP to confer with a doctor treating you and for the insurance company to provide all relevant information to the Company in the circumstances outlined above.

9.0 TERMINATION

9.1 Suspension

At any time during your employment (including, but not limited to, during a period of notice of termination) the Company reserves the right to place you on suspension pending the outcome of any investigation or proceedings under the Company’s Disciplinary Procedure or otherwise. You shall be entitled to receive all basic pay (but not overtime) and other contractual benefits during such period of suspension.

9.2 Notice

If the Company wishes to terminate your employment, the minimum notice period to be given will be 12 months. You will be required to give 6 months notice. Such notice shall be given in writing. If you wish to terminate your employment, such notice must be given by you to the Chief Executive of Parent.

If you leave without giving the proper period of notice or leave during your notice period without permission, then (without prejudice to the Company’s right to claim back its losses from you sustained by virtue of you leaving early) the Company reserves the right to deduct a day’s pay for each day not worked during the notice period. This deduction may be made from any salary due or from any accrued holiday pay or other monies due to you.

9.3 Garden Leave

The Company shall not be obliged to provide you with work at any time after notice of termination has been given by either party and the Company may in its absolute discretion:-

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a) require you to comply with such conditions as it may specify in relation to attending or remaining away from your work place and/or any other place of business of the Company and/ or Associated Company and/or any of its or their customers or clients including attending at the Company’s or Associated Company’s premises or the premises of any of its or their customers or clients for the purposes of the smooth handover of work and other responsibilities;

b) assign you to such other duties as it shall in its absolute discretion determine and/or require you to work in a different team, department, project or area;

c) withdraw any powers vested in you or any duties assigned to you and require you to resign from any directorship or office that you may hold in the Company and/ or any Associated Company;

d) instruct you not to communicate orally or in writing on business issues with suppliers, customers, clients, employees, agents and/or representatives of the Company and/ or any Associated Company; and/ or

e) require you to take all or any outstanding holiday entitlement

provided always that in the exercise of any rights under (a) – (e) above, base salary and other contractual benefits shall not cease to be payable or provided. At all times, whether or not the Company exercises its rights under (a) to (e) above, you shall continue to owe duties of good faith and fidelity and a duty not to undermine the business of the Company.

9.4 Pay in Lieu of Notice

The Company reserves the right in its absolute discretion to terminate your employment lawfully by making a payment in lieu of notice and benefits, based on base salary only. The Company may make a payment in lieu of all or any part of your notice period.

9.5 Summary Dismissal

Nothing in this Contract prevents the Company from terminating your employment immediately and without notice or a payment in lieu in circumstances set out herein, in accordance with the Disciplinary Procedure or as permitted by law, including without limitation in circumstances where:-

you commit any act of dishonesty whether relating to the Company, any Associated Company or any of its or their employees or otherwise;

you are considered to be guilty of serious or persistent misconduct or any other conduct which, in the opinion of the board of directors of the Company, tends to bring you and/ or the Company and/ or any Associated Company into disrepute;

without reasonable cause you wilfully neglect or refuse to discharge your duties or to attend to the business of the Company and/ or any Associated Company;

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in the opinion of the board of directors of the Company you fail to exercise reasonable skill and care in the performance of your duties;

you commit any act of gross misconduct;

you fail to perform your duties in accordance with the Company’s policies and procedures from time to time applicable;

you materially breach the Foster Wheeler AG Code of Business Conduct and Ethics;

you commit any material breach of this Contract;

you are convicted of any criminal offence (excluding an offence under road traffic legislation in the United Kingdom or elsewhere for which you are not disqualified from driving for any period or sentenced to any term of imprisonment whether immediate or suspended);

in the opinion of the board of directors of the Company you are incapable of performing your duties due to alcohol or drugs;

you become bankrupt or make any arrangement or composition with your creditors generally;

you are disqualified from holding office in any company;

you resign as a Director of the Company or any Associated Company, except at the request of the Company or Associated Company; and/ or

you become of unsound mind or a patient under the Mental Health Act 1993.

Any delay by the Company in exercising its right to terminate your employment without notice shall not constitute a waiver of such right.

9.6 Severance Plan

You may be eligible to receive payments made under the Foster Wheeler AG Senior Executive Severance Plan (the “Severance Plan”), subject to the provisions of the Severance Plan, as may be amended from time to time.

9.7 Return of Property

Upon termination of your employment you must deliver to the Company in accordance with its instructions all correspondence, records, specifications, computer programmes, software, disks, models, reports, notes, security badges, electronic equipment, instruments, books, reports and other publications and documents, standards, manuals, credit cards and club / associate membership cards and all other property belonging to the Company, any Associated Company and/or any of its/their customers, clients or partners which is in your possession, custody or control.

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9.8 Company’s rights and remedies

Any termination of your employment shall be without prejudice to the Company’s rights and remedies to pursue you for breach of contract and as to the continuing nature of any ongoing obligations which subsist following termination.

9.9 Expenses

Outstanding expense statements must be cleared to a zero balance before leaving, and any monies due to the Company from you (including but not limited to credit card balances and any outstanding loans) must be repaid in full. The Company reserves the right to make deductions of any sums payable by you to the Company from any monies owed to you.

10.0 MISCELLANEOUS PROVISIONS

10.1 Changes to the Contract

The Company may amend the terms of this Contract according to the needs of the business and will notify you at the earliest possible opportunity. Where an immediate change is necessary, the Company will notify you within a month of the change.

10.2 Collective Agreements

There are no collective agreements applicable to your employment which contain provisions directly affecting your terms and conditions of employment.

10.3 Notices

All notices, requests, consents and other communications required or permitted to be given hereunder shall be in writing and shall be deemed to have been duly given at the time of delivery if delivered personally, or two days after posting if sent by first class post, if to the Company, to the address specified in this Contract for the attention of the Chief Executive and if to you, to your principal residence as reflected in the records of the Company (or in either case to such other address as either party shall designate by notice in writing to the other).

10.4 Governing Law and Jurisdiction

This Contract is governed by and shall be construed in accordance with the laws of England and Wales and shall be subject to the exclusive jurisdiction of the English courts.

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Signed:	/s/ Beth Sexton	Date: September 19, 2013
For and on behalf of the Company

I hereby accept employment with the Company under the terms and conditions stated in this Contract.

Signature: /s/ J C Nield	Date: 19 September 2013
Jon Nield

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APPENDIX 1

CONFIDENTIALITY, INTELLECTUAL PROPERTY & POST-TERMINATION

RESTRICTIONS AGREEMENT

between

FOSTER WHEELER MANAGEMENT LIMITED

and

JON NIELD

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THIS AGREEMENT is dated 19 September 2013

PARTIES

(1) Foster Wheeler Management Limited, a company incorporated and registered in England and Wales with company number 05344191 whose registered office is at Shinfield Park, Reading, Berkshire RG2 9FW, UK (“Company”).

(2) Jon Nield (“Employee”).

BACKGROUND

(A) The Employee is employed by the Company from 1 September 1986, most recently as Vice President. Project Risk Management under a contract dated 19 September 2013 (“Employment Contract”).

(B) The parties have entered into this agreement to record and implement the terms on which they have agreed to ensure the adequate protection of the confidential information, intellectual property and goodwill of the Company and/or any Group Company.

(C) The Company enters into this agreement for itself and as agent and trustee for all Group Companies and it is authorised to do so. It is the parties’ intention that each Group Company should be able to enforce any rights it has under this agreement, subject to and in accordance with the Contracts (Rights of Third Parties) Act 1999.

AGREED TERMS

1. INTERPRETATION

1.1 The definitions in this clause apply in this agreement.

Appointment: the employment of the Employee by the Company on the terms of the Employment Contract.

Board: the board of directors of the Company.

Capacity: as agent, consultant, director, employee, owner, partner, shareholder or in any other capacity.

Confidential Information: For purposes of this Agreement, “Confidential Information as used in this Agreement shall include the Company’s and/or the Group Company’s trade secrets, as well as any other information or material which is not generally known to the public, and which:

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(a) is generated, collected by utilized in the operations of the Company’s and/or the Group Company’s business and relates to the actual or anticipated business, research or development of the Company and/or the Group Company; or

(b) is suggested by or results from any task assigned to the Employee by the Company and/or the Group Company or work performed by the Employee for or on behalf of the Company and/or the Group Company.

Confidential Information shall not be considered generally known to the public if Employee or others improperly reveal such information to the public without the Company’s and/or the Group Company’s express written consent and/or in violation of an obligation of confidentiality to the Company and/or the Group Company. Examples of Confidential Information include, but are not limited to, all customer, client, supplier and vendor lists, budget information, contents of any database, contracts, product designs, technical know-how, engineering data, pricing and cost information, performance standards, productivity standards, research and development work, software, business plans, proprietary data, projections, market research, perceptual studies, strategic plans, marketing information, financial information (including financial statements), sales information, training manuals, employee lists and compensation of employees, and all other competitively sensitive information with respect to the Company and/or the Group Company, whether or not it is in tangible form, and including without limitation any of the foregoing contained or described on paper or in computer software or other storage devices, as the same may exist from time to time.

Copies: copies or records of any Confidential Information in whatever form (including, without limitation, in written, oral, visual or electronic form or on any magnetic or optical disk or memory and wherever located) including, without limitation, extracts, analysis, studies, plans, compilations or any other way of representing or recording and recalling information which contains, reflects or is derived or generated from Confidential Information.

Employment Inventions: any Invention which is made wholly or partially by the Employee at any time during the course of the Employee’s employment with the Company and/or any Group Company (whether or not during working hours or using the Company’s and/or Group Company’s premises or resources, and whether or not recorded in material form).

Employment IPRs: Intellectual Property Rights created by the Employee in the course of his or her employment with the Company and/or any Group Company (whether or not during working hours or using Company premises or resources).

Garden Leave: any period during which the Company has exercised its rights under clause 18 (a), (c) or (d) in the Employment Contract.

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Group Company: the Company, its Subsidiaries or Holding Companies from time to time and any Subsidiary of any Holding Company from time to time.

Holding Company: means “holding company” as defined in section 1159 of the Companies Act 2006.

Intellectual Property Rights: patents, rights to Inventions, copyright and related rights, trademarks, trade names and domain names, rights in get-up, goodwill and the right to sue for passing off, unfair competition rights, rights in designs, rights in computer software, database rights, topography rights, rights to use and preserve the confidentiality of information (including know-how and trade secrets) and any other intellectual property rights, in each case whether registered or unregistered and including all applications (or rights to apply) for and be granted, renewals or extensions of, and rights to claim priority from, such rights and all similar or equivalent rights or forms of protection which subsist or will subsist now or in the future in any part of the world.

Invention: For purposes of this Agreement, “Inventions” shall mean all software programmes, source or object code, improvements, formulas, developments, ideas, processes, techniques, know-how, data, and discoveries, whether patentable or unpatentable, either conceived or reduced to practice by the Employee while in the Company’s and/or a Group Company’s employment, either solely or jointly with others, and whether or not during regular working hours, or conceived or reduced to practice by Employee within one year of the termination of Employee’s employment with the Company and/or any Group Company that resulted from Employee’s prior work with the Company and/or Group Company.

Pre-Contractual Statement: any undertaking, promise, assurance, statement, representation, warranty or understanding (whether in writing or not) of any person (whether party to this agreement or not) relating to the provisions under this agreement which is not expressly set out in this agreement or any documents referred to in it.

Restricted Business: the business of design, manufacture and erection of steam generating and auxiliary equipment for power stations and industrial facilities and the provision of aftermarket services related thereto, and the design, engineering, construction and project management of processing facilities and related infrastructure for the upstream oil & gas, LNG and gas-to-liquids, refining, chemicals and petrochemicals, power, mining and metals, environmental, pharmaceuticals, biotechnology and healthcare industries with which the Employee was involved to a material extent in the 12 months before Termination.

Restricted Customer: any firm, company or person who, during the 12 months before Termination, was a customer or prospective customer of OR in the habit of dealing with the Company and/or any Group Company with whom the Employee had contact or about whom the Employee became aware or informed in the course of their employment.

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Restricted Person: anyone employed or engaged by the Company and/or any Group Company who could materially damage the interests of the Company and/or any Group Company if they were involved in any Capacity in any business concern which competes with any Restricted Business and with whom the Employee dealt in the 12 months before Termination in the course of their employment.

Subsidiary: means “subsidiary” as defined in section 1159 of the Companies Act 2006.

Termination: the termination of the Employee’s employment with the Company howsoever caused.

1.2 The headings in this agreement are inserted for convenience only and shall not affect its construction.

1.3 A reference to a particular law is a reference to it as it is in force for the time being taking account of any amendment, extension, or re-enactment and includes any subordinate legislation for the time being in force made under it.

1.4 Unless the context otherwise requires, words in the singular include the plural and in the plural include the singular.

2. CONFIDENTIAL INFORMATION

2.1 Without prejudice to the Employee’s common law duties, the Employee shall not except in the proper course of the Employee’s duties, as authorised or required by law or as expressly authorised by the Company and/or the Group Company, either during the Appointment or at any time after Termination:

a) use any Confidential Information; or

b) make or use any Copies; or

c) disclose any Confidential Information to any person, company or other organisation whatsoever.

2.2 The restriction in clause 2.1 does not apply to any Confidential Information which is or comes into the public domain other than through the Employee’s unauthorised disclosure.

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2.3 The Employee shall be responsible for protecting the confidentiality of the Confidential Information and shall:

a) use their best endeavours to prevent the use or communication of any Confidential Information by any person, company or organisation (except in the proper course of their duties, as required by law or as authorised by the Company and/or the Group Company); and

b) inform the Board immediately on becoming aware, or suspecting, that any such person, company or organisation knows or has used any Confidential Information.

2.4 All Confidential Information and Copies shall be the property of the Company and/or relevant Group Company and on Termination, or at the request of the Company and/or the Group Company, at any time during the Appointment, the Employee shall:

a) immediately hand over to the Company or relevant Group Company all Confidential Information or Copies, any keys, credit cards and any other property of the Company and/or any Group Company and of any customer and/ or client of the Company and/or any Group Company;

b) irretrievably delete any Confidential Information stored on any magnetic or optical disk or memory, including personal computer networks, personal e-mail accounts or personal accounts on websites, and all matter derived from such sources which is in their possession or under their control outside the Company’s and/or Group Company’s premises; and

c) provide a signed statement that the Employee has complied fully with their obligations under this clause 2.4 together with such reasonable evidence of compliance as the Company and/or the Group Company may request.

2.5 Nothing in this clause 2 shall prevent the Employee from making a protected disclosure within the meaning of section 43A of the Employment Rights Act 1996.

3. INTELLECTUAL PROPERTY

3.1 The Employee acknowledges that all Employment IPRs, Employment Inventions and all materials embodying them shall automatically belong to the Company and/or relevant Group Company to the fullest extent permitted by law. To the extent that they do not vest in the Company and/or relevant Group Company automatically, the Employee holds them on trust for the Company and/or relevant Group Company.

3.2 The Employee acknowledges that, because of the nature of their duties and the particular responsibilities arising from the nature of their duties, the Employee has, and shall have at all times while the Employee is employed by the Company, a special obligation to further the interests of the Company and/or relevant Group Company.

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3.3 To the extent that legal title in any Employment IPRs or Employment Inventions does not vest in the Company and/or relevant Group Company by virtue of clause 3.1, the Employee agrees, immediately on creation of such rights and Inventions, to offer to the Company and/or relevant Group Company in writing a right of first refusal to acquire them on arm’s length terms to be agreed between the parties. If the parties cannot agree on such terms within 30 days of the Company and/or relevant Group Company receiving the offer, the Company and/or relevant Group Company shall refer the dispute for determination to a mutually agreed expert, provided, that where the parties cannot agree on an expert within 14 days, the Company shall appoint an expert. The expert’s decisions shall be final and binding on the parties in the absence of manifest error, and the costs paid to the arbitration body shall be borne equally by the parties. The parties will be entitled to make submissions to the expert and will provide (or procure that others provide) the expert with such assistance and documents as the expert reasonably requires for the purpose of reaching a decision. The Employee agrees that the provisions of this clause 3 shall apply to all Employment IPRs and Employment Inventions offered to the Company and/or relevant Group Company under this clause 3.3 until such time as the Company and/or relevant Group Company has agreed in writing that the Employee may offer them for sale to a third party.

3.4 The Employee agrees

a) to give the Company and/or relevant Group Company full written details of all Employment Inventions which relate to or are capable of being used in the business of the Company and/or any Group Company promptly on their creation;

b) at the Company’s and/or relevant Group Company’s request and in any event on the termination of the Employee’s employment to give to the Company and/or relevant Group Company all originals and copies of correspondence, documents, papers and records on all media which record or relate to any of the Employment IPRs;

c) not to attempt to register any Employment IPR or patent any Employment Invention unless requested to do so by the Company and/or relevant Group Company;

d) and to keep confidential each Employment Invention unless the Company and/or relevant Group Company has consented in writing to its disclosure by the Employee.

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The Employee waives all their present and future moral rights which arise under the Copyright Designs and Patents Act 1988, and all similar rights in other jurisdictions relating to any copyright which forms part of the Employment IPRs, and agrees not to support, maintain or permit any claim for infringement of moral rights in such copyright works.

3.5 The Employee acknowledges that, except as provided by law, no further remuneration or compensation is or may become due to the Employee in respect of their compliance with this clause. This clause is without prejudice to the Employee’s rights under the Patents Act 1977.

3.6 The Employee undertakes to use their best endeavours to execute all documents and do all acts both during and after their employment by the Company as may, in the opinion of the Company and/or relevant Group Company, be necessary or desirable to vest the Employment IPRs in the Company and/or relevant Group Company, to register them in the name of the Company and/or relevant Group Company and to protect and maintain the Employment IPRs and the Employment Inventions. Such documents may, at the Company’s and/or relevant Group Company’s request, include waivers of all and any statutory moral rights relating to any copyright works which form part of the Employment IPRs. The Company and/or relevant Group Company agrees to reimburse the Employee’s reasonable expenses of complying with this clause 3.6.

3.7 The Employee agrees to give all necessary assistance to the Company and/or relevant Group Company to enable it to enforce its Intellectual Property Rights against third parties, to defend claims for infringement of third party Intellectual Property Rights and to apply for registration of Intellectual Property Rights, where appropriate throughout the world, and for the full term of those rights.

3.8 The Employee hereby irrevocably appoints the Company and/or relevant Group Company to be their attorney in their name and on their behalf to execute documents, use the Employee’s name and do all things which are necessary or desirable for the Company and/or relevant Group Company to obtain for itself or its nominee the full benefit of this clause. The Employee acknowledges that a certificate in writing, signed by any director or the secretary of the Company, that any instrument or act falls within the authority conferred by this agreement shall be conclusive evidence that such is the case so far as any third party is concerned.

4. POST-TERMINATION RESTRICTIONS

4.1 In order to protect the Confidential Information and business connections of the Company and/or each Group Company to which the Employee has access or with whom he has had dealings as a result of the Appointment, the Employee covenants with the Company (for itself and as trustee and agent for each Group Company) that the Employee shall not

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a) For 12 months after Termination, solicit or endeavour to entice away from the Company and/or any Group Company the business or custom of a Restricted Customer with a view to providing goods or services to that Restricted Customer in competition with any Restricted Business;

b) For 12 months after Termination in the course of any business concern which is in competition with any Restricted Business, offer to employ or engage or otherwise endeavour to entice away from the Company and/or any Group Company any Restricted Person;

c) For 12 months after Termination in the course of any business concern which is in competition with any Restricted Business, employ or engage or otherwise facilitate the employment or engagement of any Restricted Person, whether or not such person would be in breach of contract as a result of such employment or engagement;

d) For 12 months after Termination, be involved in any Capacity with any business concern which is (or intends to be) in competition with any Restricted Business;

e) For 12 months after Termination, be involved with the provision of goods or services to (or otherwise have any business dealings with) any Restricted Customer in the course of any business concern which is in competition with any Restricted Business; or

f) at any time after Termination, represent himself/ herself as connected with the Company and/or any Group Company in any Capacity, other than as a former employee, or use any registered names or trading names associated with the Company and/or any Group Company.

4.1 Because of the international nature of the Company’s and/or Group Company’s business, the above restrictions apply in the USA, the UK and any other jurisdiction where the Employee has worked prior to or is working for the Company or any Group Company immediately before Termination.

4.2 Notwithstanding anything to the contrary, nothing in this clause 4 prohibits the Employee from being a passive owner of not more than five percent (5%) of the outstanding stock of any class of a corporation which is publicly traded, so long as the Employee has no active participation in the business of such corporation.

4.3 The restrictions imposed on the Employee by this clause 4 apply to the Employee acting:

a) directly or indirectly; and

b) on the Employee’s own behalf or on behalf of, or in conjunction with, any firm, company, person or other organisation.

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4.4 The periods for which the restrictions in clause 4.1 apply shall be reduced by any period that the Employee spends on Garden Leave immediately before Termination.

4.5 If the Employee receives an offer to be involved in a business concern in any Capacity during the Employment, or before the expiry of the last of the covenants in this clause 4, the Employee shall give the person making the offer a copy of this clause 4 and shall notify the Company and/or the Group Company of the identity of that person as soon as possible after accepting the offer.

4.6 The Employee confirms that prior to entering into the restrictions in this clause 4 they had an opportunity to take independent legal advice.

4.7 Each of the restrictions in this clause 4 is intended to be separate and severable. If any of the restrictions shall be held to be void but would be valid if part of their wording were deleted, such restriction shall apply with such deletion as may be necessary to make it valid or effective.

4.8 If the Employee’s employment is transferred to any firm, company, person or entity other than a Group Company (“New Employer”) pursuant to the Transfer of Undertakings (Protection of Employment) Regulations 2006, the Employee will, if required, enter into an agreement with the New Employer containing post-termination restrictions corresponding to those restrictions in this clause 4, protecting the confidential information, trade secrets and business connections of the New Employer.

4.9 The Employee will, at the request and expense of the Company, enter into a separate agreement with any Group Company in which the Employee agrees to be bound by restrictions corresponding to those restrictions in this clause 4 (or such of those restrictions as may be appropriate) in relation to that Group Company.

5. INJUNCTIVE RELIEF, REMEDIES AND ATTORNEYS FEES

5.1 The Employee recognises that their violation of this agreement could cause the Company and/or any Group Company irreparable harm, the amount of which may be extremely difficult to estimate, making any remedy at law or in damages inadequate. Thus, the Employee agrees that the Company and/or any Group Company shall have the right to apply to any court of competent jurisdiction for an order restraining any breach or threatened breach of this agreement and for any other relief the Company and/or any Group Company deems appropriate. This right shall be in addition to any other remedy available to the Company and/or any Group Company. Should the Company and/or the Group Company successfully enforce any portion of this agreement or obtain judgment against the Employee for a breach of this agreement

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before a court of competent jurisdiction, it shall be entitled to receive and recover from the Employee all of its reasonable attorney’s fees, litigation expenses and costs incurred as a result of enforcing this agreement and/ or obtaining judgment against the Employee.

5.2 If the Employee breaches any material provision of this agreement or pursues a claim against the Company and/or any Group Company in any country or jurisdiction arising out of the terms of this agreement or otherwise, the Employee agrees to indemnify the Company and/or the Group Company for any losses suffered as a result thereof, including but not limited to the repayment of any severance pay and benefits provided over and above the Employee’s contractual and statutory entitlement by the Company and/or any Group Company including any payments made under any severance plan and all reasonable legal and professional fees incurred.

6. ENTIRE AGREEMENT

a) This agreement and any document referred to in it constitutes the whole agreement between the parties (and in the case of the Company, as agent for any Group Companies) and supersedes all previous discussions, correspondence, negotiations, arrangements, understandings and agreements between them in relation to the terms of this agreement.

b) Each party acknowledges that in entering into this agreement it has not relied on and shall have no remedy in respect of any Pre-Contractual Statement.

c) Nothing in this agreement shall limit or exclude any liability for fraud.

7. VARIATION

No variation or agreed termination of this agreement shall be effective unless it is in writing and signed by the parties (or their authorised representatives).

8. SEVERABILITY

Each clause and sub-clause in this agreement is intended to be separate and severable. If any clause or sub-clause shall be held to be void but would be valid if part of their wording were deleted, such clause or sub-clause shall apply with such deletion as may be necessary to make it valid or effective.

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9. COUNTERPARTS

This agreement may be executed in any number of counterparts, each of which, when executed and delivered, shall be an original, and all the counterparts together shall constitute one and the same instrument.

10. THIRD PARTY RIGHTS

The Contracts (Rights of Third Parties) Act 1999 shall only apply to this agreement in relation to any Group Company and no person other than the Employee, the Company and any Group Company shall have any rights under it. The terms of this agreement may be varied, amended or modified or this agreement may be suspended, cancelled or terminated by agreement in writing between the parties or this agreement may be rescinded (in each case), without the consent of any third party.

11. GOVERNING LAW AND JURISDICTION

a) This agreement and any dispute or claim arising out of or in connection with it or its subject matter or formation (including non-contractual disputes or claims) shall be governed by and construed in accordance with the law of England and Wales.

b) The parties irrevocably agree that the courts of England and Wales shall have exclusive jurisdiction to settle any dispute or claim that arises out of or in connection with this agreement or its subject matter or formation (including non-contractual disputes or claims).

This agreement has been entered into on the date stated at the beginning of it.

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This agreement shall have effect on and from the Start Date (as defined in the Employment Contract).

Signed:	/s/ Beth Sexton	Date: September 19, 2013
For and on behalf of the Company
Signature:	/s/ J C Nield	Date: 19 September 2013
Jon Nield

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EX-23.1

EXHIBIT 23.1

CONSENT OF ANALYSIS, RESEARCH & PLANNING CORPORATION

We hereby consent to the incorporation by reference in the Registration Statements on Form S-8 (File Nos. 333-134592, 333-188443) of Foster Wheeler AG (the “Company”) of (i) the references to us in the form and context in which they appear in the Quarterly Report on Form 10-Q of the Company for the quarter ended September 30, 2013, and (ii) the use of or reliance on the information contained in our report to the Company to assist the Company in setting forth an estimate of the Company’s total liability for asbestos-related indemnity and defense costs in such registration statements.

By:	/s/ THOMAS VASQUEZ
Name:	Thomas Vasquez
Title:	Vice President
Analysis, Research & Planning Corporation
November 1, 2013

EX-31.1

EXHIBIT 31.1

CERTIFICATION PURSUANT TO SECTION 302

OF THE SARBANES-OXLEY ACT OF 2002

I, J. Kent Masters, certify that:

1. I have reviewed this quarterly report on Form 10-Q of Foster Wheeler AG;

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4. The registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

c) Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

d) Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5. The registrant’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date: November 7, 2013	/s/ J. KENT MASTERS
	J. KENT MASTERS CHIEF EXECUTIVE OFFICER

EX-31.2

EXHIBIT 31.2

CERTIFICATION PURSUANT TO SECTION 302

OF THE SARBANES-OXLEY ACT OF 2002

I, Franco Baseotto, certify that:

1. I have reviewed this quarterly report on Form 10-Q of Foster Wheeler AG;

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4. The registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

c) Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

d) Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5. The registrant’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date: November 7, 2013	/s/ FRANCO BASEOTTO
	FRANCO BASEOTTO EXECUTIVE VICE PRESIDENT, CHIEF FINANCIAL OFFICER AND TREASURER

EX-32.1

EXHIBIT 32.1

CERTIFICATION PURSUANT TO 18 U.S.C. SECTION 1350,

AS ADOPTED PURSUANT TO SECTION 906

OF THE SARBANES-OXLEY ACT OF 2002

In connection with the Quarterly Report of Foster Wheeler AG (the “Company”) on Form 10-Q for the period ended September 30, 2013, as filed with the Securities and Exchange Commission on the date hereof (the “Report”), I, J. Kent Masters, Chief Executive Officer of the Company, certify pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that:

1) The Report fully complies with the requirements of section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

2) The information contained in the Report fairly presents, in all material respects, the financial condition and results of the operations of the Company.

Date: November 7, 2013	/s/ J. KENT MASTERS
	J. KENT MASTERS CHIEF EXECUTIVE OFFICER

EX-32.2

EXHIBIT 32.2

CERTIFICATION PURSUANT TO 18 U.S.C. SECTION 1350,

AS ADOPTED PURSUANT TO SECTION 906

OF THE SARBANES-OXLEY ACT OF 2002

In connection with the Quarterly Report of Foster Wheeler AG (the “Company”) on Form 10-Q for the period ended September 30, 2013, as filed with the Securities and Exchange Commission on the date hereof (the “Report”), I, Franco Baseotto, Executive Vice President, Chief Financial Officer and Treasurer of the Company, certify pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that:

1) The Report fully complies with the requirements of section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

2) The information contained in the Report fairly presents, in all material respects, the financial condition and results of the operations of the Company.

Date: November 7, 2013	/s/ FRANCO BASEOTTO
	FRANCO BASEOTTO EXECUTIVE VICE PRESIDENT, CHIEF FINANCIAL OFFICER AND TREASURER

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Income Taxes

9 Months Ended

Sep. 30, 2013

Income Taxes [Abstract]

Income Taxes

10. Income Taxes

Although we are a Swiss corporation, our shares are listed on a U.S. exchange; therefore, we reconcile our effective tax rate to the U.S. federal statutory rate of 35% to facilitate meaningful comparison with peer companies in the U.S. capital markets. Our effective tax rate can fluctuate significantly from period to period and may differ considerably from the U.S. federal statutory rate as a result of (i) income taxed in various non-U.S. jurisdictions with rates different from the U.S. statutory rate, (ii) our inability to recognize a tax benefit for losses generated by certain unprofitable operations and (iii) the varying mix of income earned in the jurisdictions in which we operate. In addition, our deferred tax assets are reduced by a valuation allowance when, based upon available evidence, it is more likely than not that the tax benefit of loss carryforwards (or other deferred tax assets) will not be realized in the future. In periods when operating units subject to a valuation allowance generate pre-tax earnings, the corresponding reduction in the valuation allowance favorably impacts our effective tax rate. Conversely, in periods when operating units subject to a valuation allowance generate pre-tax losses, the corresponding increase in the valuation allowance has an unfavorable impact on our effective tax rate.

Effective Tax Rate for 2013

Our effective tax rate for the first nine months of 2013 was lower than the U.S. statutory rate of 35% due principally to the net impact of the following:

• Income earned in non-U.S. jurisdictions which contributed to an approximate 17-percentage point reduction in our effective tax rate, primarily because of tax rates lower than the U.S. statutory rate, as well as additional impacts from equity income of joint ventures, tax incentives and credits, and other items;
• Discrete items, primarily relating to the reversal of a previously accrued liability for branch taxes no longer required to be paid as a result of an exemption received from a non-U.S. tax authority, which was partially offset by the impact of a change in tax rate on net deferred assets in a non-U.S. jurisdiction, provided a netone-percentage point reduction to the effective tax rate; and
• A valuation allowance increase because we are unable to recognize a tax benefit for year-to-date losses subject to a valuation allowance in certain jurisdictions (primarily in the U.S.), partially offset by valuation allowance releases in certain non-U.S. jurisdictions,which contributed to an approximate three-percentage point increase in our effective tax rate.

Effective Tax Rate for 2012

Our effective tax rate for the first nine months of 2012 was lower than the U.S. statutory rate of 35% due principally to the net impact of the following:

• Income earned in non-U.S. jurisdictions which contributed to an approximate 15-percentage point reduction in our effective tax rate, primarily because of tax rates lower than the U.S. statutory rate, as well as additional impacts from equity income of joint ventures, tax incentives and credits, and other items; and
• A valuation allowance increase because we were unable to recognize a tax benefit for year-to-date losses subject to a valuation allowance in certain jurisdictions (primarily in the U.S.), which contributed to an approximate two-percentage point increase in our effective tax rate.

We monitor the jurisdictions for which valuation allowances against deferred tax assets were established in previous years, and we evaluate, on a quarterly basis, the need for the valuation allowances against deferred tax assets in those jurisdictions. Such evaluation includes a review of all available evidence, both positive and negative, in determining whether a valuation allowance is necessary.

The majority of the U.S. federal tax benefits, against which valuation allowances have been established, do not expire until 2026 and beyond, based on current tax laws.

Our subsidiaries file income tax returns in many tax jurisdictions, including the U.S., several U.S. states and numerous non-U.S. jurisdictions around the world. Tax returns are also filed in jurisdictions where our subsidiaries execute project-related work. The statute of limitations varies by jurisdiction. Because of the number of jurisdictions in which we file tax returns, in any given year the statute of limitations in a number of jurisdictions may expire within 12 months from the balance sheet date. As a result, we expect recurring changes in unrecognized tax benefits due to the expiration of the statute of limitations, none of which are expected to be individually significant. With few exceptions, we are no longer subject to U.S. (including federal, state and local) or non-U.S. income tax examinations by tax authorities for years before 2008.

A number of tax years are under audit by the relevant tax authorities in various jurisdictions. We anticipate that several of these audits may be concluded in the foreseeable future, including during the remainder of 2013. Based on the status of these audits, it is reasonably possible that the conclusion of the audits may result in a reduction of unrecognized tax benefits. However, it is not possible to estimate the magnitude of any such reduction at this time. We recognize interest accrued on the unrecognized tax benefits in interest expense and penalties on the unrecognized tax benefits in other deductions, net on our consolidated statement of operations.

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Derivative Financial Instruments (Details) (USD $) In Thousands, unless otherwise specified	Sep. 30, 2013	Dec. 31, 2012
Asset Derivatives	$ 7,938	$ 7,397
Liability Derivatives	10,953	15,414
Designated as Hedging Instrument [Member] | Other Assets [Member] | Interest Rate Contract [Member]
Asset Derivatives	0	0
Designated as Hedging Instrument [Member] | Other Long-Term Liabilities [Member] | Interest Rate Contract [Member]
Liability Derivatives	8,809	10,490
Not Designated as Hedging Instrument [Member] | Contracts In Process Or Billings In Excess Of Costs And Estimated Earnings On Uncompleted Contracts [Member] | Foreign Exchange Contract [Member]
Asset Derivatives	7,603	6,040
Liability Derivatives	1,663	4,895
Not Designated as Hedging Instrument [Member] | Other accounts receivable [Member] | Foreign Exchange Contract [Member]
Asset Derivatives	335	1,357
Not Designated as Hedging Instrument [Member] | Other accounts payable [Member] | Foreign Exchange Contract [Member]
Liability Derivatives	$ 481	$ 29

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CONSOLIDATED BALANCE SHEET (USD $) In Thousands, unless otherwise specified	Sep. 30, 2013	Dec. 31, 2012
Current Assets:
Cash and cash equivalents	$ 497,129	$ 582,322
Accounts and notes receivable, net:
Trade	619,717	609,213
Other	90,385	86,981
Contracts in process	207,809	228,979
Prepaid, deferred and refundable income taxes	62,521	57,404
Other current assets	41,705	47,138
Current assets of discontinued operations	0	1,505
Total current assets	1,519,266	1,613,542
Land, buildings and equipment, net	280,245	285,402
Restricted cash	54,602	62,189
Notes and accounts receivable - long-term	14,111	14,119
Investments in and advances to unconsolidated affiliates	192,253	205,476
Goodwill	168,720	133,518
Other intangible assets, net	118,233	105,100
Asbestos related insurance recovery receivable	114,188	132,438
Long-term assets of discontinued operations	0	49,579
Other assets	143,169	90,509
Deferred tax assets	44,147	42,052
TOTAL ASSETS	2,648,934	2,733,924
Current Liabilities:
Current installments on long-term debt	13,783	13,672
Accounts payable	277,627	298,411
Accrued expenses	254,144	231,602
Billings in excess of costs and estimated earnings on uncompleted contracts	527,642	564,356
Income taxes payable	39,771	64,992
Liabilities of discontinued operations	0	3,154
Total current liabilities	1,112,967	1,176,187
Long-term debt	117,113	124,034
Deferred tax liabilities	45,341	40,889
Pension, postretirement and other employee benefits	169,196	177,345
Asbestos-related liability	237,632	259,350
Other long-term liabilities	202,793	190,132
Commitments and contingencies	0	0
TOTAL LIABILITIES	1,885,042	1,967,937
Temporary Equity:
Non-vested share-based compensation awards subject to redemption	12,313	8,594
TOTAL TEMPORARY EQUITY	12,313	8,594
Equity:
Registered shares: CHF 3.00 par value; authorized: 157,157,448 shares and 171,018,974 shares, respectively; conditionally authorized: 58,874,658 shares and 59,369,723 shares, respectively; issued: 104,936,654 shares and 108,701,018 shares, respectively; outstanding: 98,344,954 shares and 104,441,589 shares, respectively.	257,614	269,633
Paid-in capital	202,556	266,943
Retained earnings	970,331	835,993
Accumulated other comprehensive loss	(562,766)	(567,603)
Treasury shares (outstanding: 6,591,700 shares and 4,259,429 shares, respectively)	(150,131)	(90,976)
TOTAL FOSTER WHEELER AG SHAREHOLDERS' EQUITY	717,604	713,990
Noncontrolling interests	33,975	43,403
TOTAL EQUITY	751,579	757,393
TOTAL LIABILITIES, TEMPORARY EQUITY AND EQUITY	$ 2,648,934	$ 2,733,924

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Investments

9 Months Ended

Sep. 30, 2013

Investments

Investments

3.Investments

Investment in Unconsolidated Affiliates

We own a noncontrolling interest in two electric power generation projects, one waste-to-energy project and one wind farm project,which are all located in Italy, and in a refinery/electric power generation project,which is located in Chile. We also own a 50%noncontrolling interest in a project in Italy which generates earnings from royalty payments linked to the price of natural gas. Based on the outstanding equity interests of these entities, we own 41.65% of each of the two electric power generation projects in Italy, 39% of the waste-to-energy project and 50% of the wind farm project. We have a notional 85% equity interest in the project in Chile; however, we are not the primary beneficiary as a result of participation rights held by the minority shareholder. In determining that we are not the primary beneficiary, we considered the minority shareholder's right to approve activities of the project that most significantly impact the project's economic performance which include the right to approve or reject the annual financial (capital and operating) budget and the annual operating plan, the right to approve or reject the appointment of the general manager and senior management, and approval rights with respect to capital expenditures beyond those included in the annual budget.

We account for these investments in Italy and Chile under the equity method. The following is summarized financial information for these entities (each as a whole) based on where the projects are located:

	September 30, 2013				December 31, 2012
		Italy		Chile		Italy		Chile
Balance Sheet Data:
Current assets	$	141,817	$	55,220	$	142,584	$	137,626
Other assets (primarily buildings and equipment)		353,173		91,339		358,366		98,550
Current liabilities		97,545		20,254		91,085		60,082
Other liabilities (primarily long-term debt)		198,230		15,953		214,025		23,061
Net assets	$	199,215	$	110,352	$	195,840	$	153,033

	Quarter Ended September 30,								Nine Months Ended September 30,
	2013				2012				2013				2012
		Italy		Chile		Italy		Chile		Italy		Chile		Italy		Chile
Income Statement Data:
Total revenues	$	30,570	$	18,065	$	65,746	$	19,377	$	97,585	$	59,394	$	148,486	$	70,267
Gross profit		6,700		12,539		7,976		12,120		20,702		36,097		18,428		40,797
Income before income taxes		5,125		11,928		5,435		15,770		15,478		34,066		10,905		44,166
Net earnings		3,180		9,303		3,209		12,853		9,919		26,535		6,856		36,220

Our investment in these unconsolidated affiliates is recorded within investments in and advances to unconsolidated affiliates on the consolidated balance sheet and our equity in the net earnings of these unconsolidated affiliates is recorded within other income, net on the consolidated statement of operations. The investments and equity earnings of our unconsolidated affiliates in Italy and Chile are included in our Global E&C Groupand Global Power Group business segments, respectively.

Our consolidated financial statements reflect the following amounts related to our unconsolidated affiliates in Italy and Chile:

	Quarter Ended September 30,				Nine Months Ended September 30,
		2013		2012		2013		2012
Equity in the net earnings of unconsolidated affiliates	$	6,944	$	6,856	$	27,382	$	22,675
Distributions from equity affiliates	$	-	$	-	$	55,933	$	31,917
					September 30, 2013		December 31, 2012
Investments in unconsolidated affiliates					$	161,127	$	187,363

Our equity earnings from our projects in Italy were $1,531 and $1,573 in the third quarter of 2013 and 2012, respectively, and were $4,915 and $4,001 in the first nine months of 2013 and 2012, respectively.

Our equity earnings from our project in Chile were $5,413 and $5,283in the third quarter of 2013 and 2012, respectively, and were $22,467 and $18,674in the first nine months of 2013 and 2012, respectively.

The increase in equity earnings in the nine months ended September 30, 2013, compared to the same period in 2012, was primarily driven by three items: a $3,200 increase in our share of the project's 2012 earnings recognized as a result of a revised earnings allocation for 2012 that was approved in connection with the approval by the project's governing board of the 2012 earnings distribution in the second quarter of 2013, and a $3,000 increase from the reversal of an insurance-related contingency during the second quarter of 2013, partially offset by the impact of lower marginal rates for electrical power generation in the nine months ended September 30, 2013.

We have guaranteed certain performance obligations of our project in Chile. We have a contingent obligation, which is measured annually based on the operating results of our project in Chile for the preceding year and is shared equally with our minority interest partner. We did not have a current payment obligation under this guarantee as of September 30, 2013 or December 31, 2012.

In addition, we have provided a $10,000 debt service reserve letter of credit to cover debt service payments in the event that our project in Chile does not generate sufficient cash flows to make such payments. We are required to maintain the debt service reserve letter of credit during the term of our project in Chile's debt, which matures in 2014. As of September 30, 2013, no amounts have been drawn under this letter of credit and we do not anticipate any amounts being drawn under this letter of credit.

We also have a wholly-owned subsidiary that provides operations and maintenance services to our project in Chile. We record the fees for operations and maintenance services in operating revenues on our consolidated statement of operations and the corresponding receivable in trade accounts and notes receivable on our consolidated balance sheet.

Our consolidated financial statements include the following balances related to our project in Chile:

		Quarter Ended September 30,				Nine Months Ended September 30,
			2013		2012		2013		2012
Fees for operations and maintenance services
	(included in operating revenues)	$	2,800	$	2,628	$	8,399	$	7,885
						September 30, 2013		December 31, 2012
Receivable from our unconsolidated affiliate
	in Chile (included in trade receivables)					$	4,184	$	16,933

We also have guaranteed the performance obligations of our wholly-owned subsidiary under the operations and maintenance agreement governing our project in Chile. The guarantee is limited to $20,000 over the life of the operations and maintenance agreement, which extends through 2016. No amounts have ever been paid under the guarantee.

During the quarter and nine months ended September 30, 2013, we acquired a 49% interest in a joint venture company that is fully licensed to engineer, procure and construct process facilities in China. We paid cash consideration of approximately 72,000CYN (approximately $11,600 based on the exchange rate in effect on the closing date). This investment is included in investments in and advances to unconsolidated affiliates on our consolidated balance sheet.

Other Investments

We are the majority equity partner and general partner of a gas-fired cogeneration project in Martinez, California, which we have determined to be a VIE as of September 30, 2013and December 31, 2012. We are the primary beneficiaryof theVIE, since we have the power to direct the activities that most significantly impact the VIE's performance. These activities include the operations and maintenance of the facilities. Accordingly, as the primary beneficiary of the VIE,we have consolidated this entity. The aggregate net assets of this entity are presented below.

Balance Sheet Data (excluding intercompany balances):	September 30, 2013		December 31, 2012
Current assets	$	5,425	$	15,610
Other assets (primarily buildings and equipment)		36,719		39,194
Current liabilities		2,565		4,825
Other liabilities		4,484		5,452
Net assets	$	35,095	$	44,527

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Goodwill and Other Intangible Assets (Tables)

9 Months Ended

Sep. 30, 2013

Goodwill and Other Intangible Assets

Net Carrying Amount of Goodwill by Geographic Region and Business Segment - Table

	Global E&C Group				Global Power Group
Geographic Regions:	September 30, 2013		December 31, 2012		September 30, 2013		December 31, 2012
North America	$	85,017	$	55,962	$	4,266	$	4,266
Asia		752		858		-		-
Europe		6,627		2,568		71,490		69,864
Middle East		568		-		-		-
Total	$	92,964	$	59,388	$	75,756	$	74,130

Finite-lived Intangible Assets - Table

		September 30, 2013						December 31, 2012
		Gross				Net		Gross				Net
		Carrying		Accumulated		Carrying		Carrying		Accumulated		Carrying
		Amount		Amortization		Amount		Amount		Amortization		Amount
Patents		$	41,325	$	(33,863)	$	7,462	$	41,103	$	(32,273)	$	8,830
Trademarks			66,034		(33,342)		32,692		64,582		(31,483)		33,099
Customer relationships,
	pipeline and backlog		96,109		(23,091)		73,018		72,050		(14,531)		57,519
Technology			6,748		(1,687)		5,061		6,594		(942)		5,652
Total		$	210,216	$	(91,983)	$	118,233	$	184,329	$	(79,229)	$	105,100

Intangible Assets Amortization Schedule - Table

		Quarter Ended September 30,				Nine Months Ended September 30,
			2013		2012		2013		2012
Amortization expense		$	4,291	$	2,712	$	12,330	$	8,264
Approximate full year amortization expense for years:
	2013							$	16,900
	2014								17,000
	2015								12,500
	2016								9,900
	2017								9,500

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Litigation and Uncertainties (US Net Asbestos Provision - Table) (Details) (USD $) In Thousands, unless otherwise specified	3 Months Ended		9 Months Ended
	Sep. 30, 2013	Sep. 30, 2012	Sep. 30, 2013	Sep. 30, 2012
Net asbestos-related (gain)/provision	$ 2,000	$ 2,000	$ (9,750)	$ 7,710
United States [Member]
Asbestos related accrual carrying value provision	2,000	2,000	6,000	5,997
Gain on the settlement of coverage litigation	0	0	(15,750)	0
Net asbestos-related (gain)/provision	$ 2,000	$ 2,000	$ (9,750)	$ 5,997

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Derivative Financial Instruments (Narrative) (Details) (USD $) In Thousands, unless otherwise specified	9 Months Ended
	Sep. 30, 2013	Sep. 30, 2012
Derivative Instruments and Hedging Activities Disclosure [Abstract]
Total gross notional amount related to foreign currency forward contracts	$ 446,500
Net cash inflows on the settlement of derivatives	5,179	1,521
Aggregate notional amount of the receive-variable/pay-fixed interest rate swaps at end of period	$ 59,300
Derivative, Lower Remaining Maturity Range	0 years 0 months 1 day
Derivative, Higher Remaining Maturity Range	2 years 0 months 0 days

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Business Segments

9 Months Ended

Sep. 30, 2013

Business Segments [Abstract]

Business Segments

11. Business Segments

We operate through two operating segments, or groups: our Global E&C Group and our Global Power Group.

Global E&C Group

Our Global E&C Group, which operates worldwide, designs, engineers and constructs onshore and offshore upstream oil and gas processing facilities, natural gas liquefaction facilities and receiving terminals, gas-to-liquids facilities, oil refining, chemical and petrochemical, pharmaceutical and biotechnology facilities and related infrastructure, including power generation facilities, distribution facilities, gasification facilities and processing facilities associated with the minerals and metals sector. Our Global E&C Group is also involved in the design of facilities in developing market sectors, including carbon capture and storage, solid fuel-fired integrated gasification combined-cycle power plants, coal-to-liquids, coal-to-chemicals and biofuels. Additionally, our Global E&C Group owns and operates electric power generating wind farms in Italy and also owns a noncontrolling interest in two electric power generation projects, one waste-to-energy project and one wind farm project, all of which are located in Italy, and a noncontrolling interest in a joint venture company that is fully licensed to engineer, procure and construct process facilities in China. Our Global E&C Group generates revenues from design, engineering, procurement, construction and project management activities pursuant to contracts which generally span up to approximately four years in duration and from returns on its equity investments in various power production facilities.

Global Power Group

Our Global Power Group designs, manufactures and erects steam generating and auxiliary equipment for electric power generating stations, district heating and industrial facilities worldwide. Additionally, our Global Power Group holds a controlling interest and operates a combined-cycle gas turbine facility; owns a noncontrolling interest in a petcoke-fired circulating fluidized-bedfacility for refinery steam and power generation; and operates a university cogeneration power facility for steam/electric generation. Our Global Power Group generates revenues from engineering activities, equipment supply, construction contracts, operating and maintenance agreements, royalties from licensing its technology, and from returns on its investments in various power production facilities.

Our Global Power Group's steam generating equipment includes a broad range of steam generation and environmental technologies, offering independent power producers, utilities, municipalities and industrial clients high-value technology solutions for converting a wide range of fuels, such as coal, lignite, petroleum coke, oil, gas, solar, biomass, municipal solid waste and waste flue gases into steam, which can be used for power generation, district heating or industrial processes.

Corporate and Finance Group

In addition to our Global E&C Group and Global Power Group, which represent two of our operating segments for financial reporting purposes, we report the financial results associated with the management of entities which are not managed by one of our two business groups, which include corporate center expenses, our captive insurance operation and expenses related to certain legacy liabilities, such as asbestos, in the Corporate and Finance Group, which also represents an operating segment for financial reporting purposes and which we refer to as the C&F Group.

Operating Revenues

We conduct our business on a global basis. Operating revenues for our continuing operations by industry, operating segment and geographic regions, based upon where our projects are being executed, were as follows:

	Quarter Ended September 30,				Nine Months Ended September 30,
		2013		2012		2013		2012
Operating Revenues (Third-Party) by Industry:
Power generation	$	194,258	$	214,742	$	563,713	$	729,178
Oil refining		323,019		337,067		1,006,651		1,022,978
Pharmaceutical		29,308		13,606		107,706		40,199
Oil and gas		83,145		109,466		254,626		524,580
Chemical/petrochemical		124,284		80,209		360,831		225,956
Power plant design, operation and maintenance		41,773		28,248		125,282		80,371
Environmental		1,426		1,790		4,271		6,434
Other, net of eliminations		4,613		12,168		32,297		31,652
Total	$	801,826	$	797,296	$	2,455,377	$	2,661,348
Operating Revenues (Third-Party) by Business Segment:
Global E&C Group	$	615,028	$	578,072	$	1,865,721	$	1,915,087
Global Power Group		186,798		219,224		589,656		746,261
Total	$	801,826	$	797,296	$	2,455,377	$	2,661,348
Operating Revenues (Third-Party) by Geographic Region:
Africa	$	12,694	$	22,475	$	52,341	$	70,136
Asia Pacific		208,073		231,267		612,348		947,867
Europe		192,318		189,003		596,154		647,935
Middle East		91,482		65,166		236,284		178,015
North America		205,570		211,711		729,583		572,826
South America		91,689		77,674		228,667		244,569
Total	$	801,826	$	797,296	$	2,455,377	$	2,661,348

EBITDA

EBITDA is the primary measure of operating performance used by our chief operating decision maker.We define EBITDA as net income attributable to Foster Wheeler AG before interest expense, income taxes and depreciation and amortization.

A reconciliation of EBITDA to net income attributable to Foster Wheeler AG is shown below:

			Quarter Ended September 30,				Nine Months Ended September 30,
				2013		2012		2013		2012
EBITDA:
	Global E&C Group		$	59,940	$	51,964	$	157,261	$	138,809
	Global Power Group			45,428		64,396		115,699		158,535
	C&F Group *			(21,301)		(25,528)		(49,810)		(76,398)
	Discontinued operations			1,760		752		4,184		2,779
		Total EBITDA		85,827		91,584		227,334		223,725
	Less: Discontinued operations			1,760		752		4,184		2,779
		EBITDA from continuing operations		84,067		90,832		223,150		220,946
Add: Net (loss)/income attributable to noncontrolling interests				(467)		4,057		3,823		10,712
Less: Interest expense				3,388		3,197		9,976		10,862
Less: Depreciation and amortization				14,032		12,178		42,828		35,541
Income from continuing operations before income taxes				66,180		79,514		174,169		185,255
Less: Provision for income taxes				17,794		16,790		36,273		43,965
Income from continuing operations				48,386		62,724		137,896		141,290
Income/(loss) from discontinued operations				1,760		(445)		265		(851)
Net income				50,146		62,279		138,161		140,439
Less: Net (loss)/income attributable to noncontrolling interests				(467)		4,057		3,823		10,712
Net income attributable to Foster Wheeler AG			$	50,613	$	58,222	$	134,338	$	129,727
______________
* Includes general corporate income and expense, our captive insurance operation and the elimination of transactions and balances related to intercompany interest.
EBITDA in the above table includes the following:			Quarter Ended September 30,				Nine Months Ended September 30,
				2013		2012		2013		2012
Net increase in contract profit from the regular
	revaluation of final estimated contract profit revisions:(1)
	Global E&C Group(2)		$	13,800	$	7,000	$	38,200	$	12,100
	Global Power Group(3)			16,400		15,700		36,600		45,900
		Total	$	30,200	$	22,700	$	74,800	$	58,000
Net asbestos-related provision/(gain):(4)
	Global E&C Group			-		-		-		1,700
	C&F Group			2,000		2,000		(9,800)		6,000
		Total	$	2,000	$	2,000	$	(9,800)	$	7,700
Charges for severance-related postemployment benefits:
	Global E&C Group		$	1,000	$	-	$	3,900	$	-
	Global Power Group			3,000		-		4,100		-
	C&F Group			-		-		400		-
		Total	$	4,000	$	-	$	8,400	$	-

______________

(1)Please refer to “Revenue Recognition on Long-Term Contracts” in Note 1 for further information regarding changes in our final estimated contract profit.

(2)The changes in final estimated contract profit revisions for our Global E&C Group and our financial results did not include an increase in final estimated contract profit of approximately $5,300 during the quarter and nine months ended September 30, 2012. The correction was recorded in the quarter ended December 31, 2012 as it was not material to the financial results for the quarter and nine months ended September 30, 2012 (the periods in which it should have been recorded), nor was it material to the financial results for the year ended December 31, 2012.

(3)The changes in final estimated contract profit revisions for our Global Power Group were increased during the nine months ended September 30, 2012 for a favorable settlement with a subcontractor of approximately $6,900.

(4)Please refer to Note 12 for further information regarding the revaluation of our asbestos liability and related asset.

The accounting policies of our business segments are the same as those described in our summary of significant accounting policies as disclosed in our 2012 Form 10-K. The only significant intersegment transactions relate to interest on intercompany balances. We account for interest on those arrangements as if they were third-party transactions (i.e., at current market rates) and we include the elimination of that activity in the results of the C&F Group.

Income/(loss) from discontinued operations included the following:

	Quarter Ended September 30,				Nine Months Ended September 30,
		2013		2012		2013		2012
EBITDA from discontinued operations	$	1,760	$	752	$	4,184	$	2,779
Less: Interest expense		-		-		-		-
Less: Depreciation and amortization*		-		1,197		3,919		3,630
Income/(loss) from discontinued operations before income taxes*		1,760		(445)		265		(851)
Less: Provision for income taxes		-		-		-		-
Income/(loss) from discontinued operations*	$	1,760	$	(445)	$	265	$	(851)

__________________

* During the nine months ended September 30, 2013, we recorded an impairment charge of $3,919 at our Camden, New Jersey waste-to-energy facility which was recorded as depreciation expense withinincome/(loss)from discontinued operations. Please refer to Note 13 for further information.

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Borrowings (Components of long-term debt) (Parenthetical) (Details)	Sep. 30, 2013	Dec. 31, 2012
Secured Debt - Energia Holdings [Member]
Interest rate on term loan	11.443%	11.443%
1999C Bonds [Member]
Interest rate on term loan	7.25%	7.25%

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Share-Based Compensation Plans (Summary of share-based compensation expense and related income tax benefit) (Details) (USD $) In Thousands, unless otherwise specified	3 Months Ended		9 Months Ended
	Sep. 30, 2013	Sep. 30, 2012	Sep. 30, 2013	Sep. 30, 2012
Share - Based Compensation Plans [Abstract]
Share-based Compensation	$ 4,638	$ 5,668	$ 14,119	$ 16,362
Related income tax benefit	$ 153	$ 144	$ 599	$ 403

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Investments (Equity Method Investments, Summarized Financial Data - Table) (Details) (USD $) In Thousands, unless otherwise specified	3 Months Ended		9 Months Ended
	Sep. 30, 2013	Sep. 30, 2012	Sep. 30, 2013	Sep. 30, 2012	Dec. 31, 2012
Italy [Member]
Current assets	$ 141,817		$ 141,817		$ 142,584
Other assets (primarily buildings and equipment)	353,173		353,173		358,366
Current liabilities	97,545		97,545		91,085
Other liabilities (primarily long-term debt)	198,230		198,230		214,025
Net assets	199,215		199,215		195,840
Total revenues	30,570	65,746	97,585	148,486
Gross profit	6,700	7,976	20,702	18,428
Income before income taxes	5,125	5,435	15,478	10,905
Net earnings	3,180	3,209	9,919	6,856
Chile [Member]
Current assets	55,220		55,220		137,626
Other assets (primarily buildings and equipment)	91,339		91,339		98,550
Current liabilities	20,254		20,254		60,082
Other liabilities (primarily long-term debt)	15,953		15,953		23,061
Net assets	110,352		110,352		153,033
Total revenues	18,065	19,377	59,394	70,267
Gross profit	12,539	12,120	36,097	40,797
Income before income taxes	11,928	15,770	34,066	44,166
Net earnings	$ 9,303	$ 12,853	$ 26,535	$ 36,220

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Guarantees and Warranties (Tables)

9 Months Ended

Sep. 30, 2013

Guarantees and Warranties [Abstract]

Warranty Liability Rollforward-Table

	Nine Months Ended September 30,
Warranty Liability:		2013		2012
Balance at beginning of year	$	90,100	$	93,000
Accruals		16,700		22,700
Settlements		(10,400)		(11,400)
Adjustments to provisions*		(16,000)		(16,800)
Foreign currency translation		(100)		1,500
Balance at end of period	$	80,300	$	89,000

_________________

• Adjustments to the provisions represent reversals of warranty provisions that are no longer required.

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Pensions and Other Postretirement Benefits (Tables)

9 Months Ended

Sep. 30, 2013

Pensions and Other Postretirement Benefits [Abstract]

Pension Benefits Contributions - Table

Contributions in the nine months ended September 30, 2013	$	14,900
Remaining contributions expected for the year 2013		5,700
Contributions expected for the year 2013	$	20,600

Defined Benefit Plan - Table

		Defined Benefit Pension Plans								Other Postretirement Benefit Plans
	Quarter Ended				Nine Months Ended				Quarter Ended				Nine Months Ended
	September 30,				September 30,				September 30,				September 30,
		2013		2012		2013		2012		2013		2012		2013		2012
Net periodic benefit cost/(credit):
Service cost	$	277	$	257	$	869	$	794	$	14	$	17	$	42	$	53
Interest cost		12,619		13,160		38,158		39,481		606		687		2,017		2,061
Expected return on plan assets		(16,023)		(16,042)		(48,411)		(48,115)		-		-		-		-
Amortization of net actuarial loss		4,548		4,251		13,705		12,736		220		107		660		320
Amortization of prior service credit		(383)		(395)		(1,159)		(1,184)		(874)		(879)		(2,622)		(2,636)
Amortization of transition obligation		14		13		42		38		-		-		-		-
Net periodic benefit cost/(credit)	$	1,052	$	1,244	$	3,204	$	3,750	$	(34)	$	(68)	$	97	$	(202)

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Goodwill and Other Intangible Assets (Narrative) (Details) (USD $) In Thousands, unless otherwise specified						9 Months Ended
	Sep. 30, 2013	Dec. 31, 2012	Sep. 30, 2013 U.S.- based firm that specializes in management of construction and commissioning of pharmaceutical and biotech facilities acquisition [Member]	Sep. 30, 2013 Engineering and project management business [Member]	Sep. 30, 2013 Upstream consultancy business [Member]	Sep. 30, 2013 Engineering procurement and construction management acquisition [Member]	Sep. 30, 2013 Global E and C Group [Member]	Sep. 30, 2013 Global Power Group [Member]
Total identifiable intangible assets - net carrying amount	$ 118,233	$ 105,100					$ 71,370	$ 46,863
Goodwill increase due to business acquisition			10,571	18,143	4,465
Working capital adjustment related to acquisition						$ 2,026

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Summary of Significant Accounting Policies (Basic and diluted earnings per share - Table) (Details) (USD $) In Thousands, except Share data, unless otherwise specified	3 Months Ended		9 Months Ended
	Sep. 30, 2013	Sep. 30, 2012	Sep. 30, 2013	Sep. 30, 2012
Earnings Per Share [Abstract]
Income from continuing operations attributable to Foster Wheeler AG	$ 48,853	$ 58,667	$ 134,073	$ 130,578
Basic weighted-average number of shares outstanding	98,172,200	107,065,999	100,830,719	107,558,489
Effect of dilutive securities	431,386	253,963	495,874	298,879
Diluted weighted-average number of shares outstanding	98,603,586	107,319,962	101,326,593	107,857,368
Basic earnings per share	$ 0.50	$ 0.55	$ 1.33	$ 1.22
Diluted earnings per share	$ 0.50	$ 0.55	$ 1.32	$ 1.21

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Investments (Refinery/power generation project in Chile - Table) (Details) (Chile [Member], USD $) In Thousands, unless otherwise specified	3 Months Ended		9 Months Ended
	Sep. 30, 2013	Sep. 30, 2012	Sep. 30, 2013	Sep. 30, 2012	Dec. 31, 2012
Chile [Member]
Fees for operations and maintenance services (included in operating revenues)	$ 2,800	$ 2,628	$ 8,399	$ 7,885
Receivable from our unconsolidated affiliate in Chile (included in trade receivables)	$ 4,184		$ 4,184		$ 16,933

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Borrowings (Narrative) (Details) (US 2012 Senior Credit Agreement [Member], USD $) In Thousands, unless otherwise specified	9 Months Ended
	Sep. 30, 2013	Dec. 31, 2012
US 2012 Senior Credit Agreement [Member]
Line of Credit Facility, Description on U.S. Senior Credit Agreement	Senior Credit Agreement — On August 3, 2012, we entered into a new five-year senior unsecured credit agreement, which replaced our amended and restated senior unsecured credit agreement from July 2010. Our new senior credit agreement provides for an unsecured revolving line of credit of $750,000 and contains an increase option permitting us, subject to certain requirements, to arrange with existing lenders and/or new lenders to provide up to an aggregate of $300,000 in additional commitments. During the term of this senior credit agreement, we may request, subject to certain requirements, up to two one-year extensions of the contractual termination date. We can issue up to $750,000 under the letter of credit portion of the facility. Letters of credit issued under our new senior credit agreement have performance pricing that is decreased (or increased) as a result of improvements (or reductions) in our corporate credit ratings, as defined in the senior credit agreement. Based on our current credit ratings, letter of credit fees for performance and non-performance letters of credit issued under our new senior credit agreement are 0.75% and 1.50% per annum of the outstanding amount, respectively, excluding a nominal fronting fee. We also have the option to use up to $250,000 of the $750,000 for revolving borrowings at a rate equal to adjusted LIBOR, as defined in the senior credit agreement, plus 1.50%, subject also to the performance pricing noted above.
Letters of credit capacity under the credit facility	$ 750,000
Fees and expenses in conjunction with the execution of senior credit agreement	4,000
Letters of credit facility, amount outstanding	250,900	250,600
Letter of credit fees under U.S. senior credit agreement, Minimum	0.75%	0.75%
Letter of credit fees under U.S. senior credit agreement, Maximum	1.50%	1.50%
Borrowing capacity under credit facility	750,000
Amount of option to use for revolving borrowings	250,000
Line of Credit Facility, Aggregate Additional Uncommited Capacity	$ 300,000
Line of Credit Facility, Interest Rate Description	a rate equal to adjusted LIBOR, as defined in the senior credit agreement, plus 1.50%

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Litigation and Uncertainties (Tables)

9 Months Ended

Sep. 30, 2013

United States [Member]

Asbestos-Related Open Claims Rollforward- Table

	Quarter Ended September 30,		Nine Months Ended September 30,
Number of Claims by period:	2013	2012	2013	2012
Open claims at beginning of period	124,810	124,680	125,310	124,540
New claims	950	1,130	3,410	3,470
Claims resolved	(510)	(1,210)	(3,470)	(3,410)
Open claims at end of period	125,250	124,600	125,250	124,600

Asbestos-Related Assets and Liabilities - Table

U.S. Asbestos	September 30, 2013		December 31, 2012
Asbestos-related assets recorded within:
Accounts and notes receivable-other	$	22,184	$	33,626
Asbestos-related insurance recovery receivable		86,195		102,751
Total asbestos-related assets	$	108,379	$	136,377
Asbestos-related liabilities recorded within:
Accrued expenses	$	35,127	$	47,900
Asbestos-related liability		207,380		227,400
Total asbestos-related liabilities	$	242,507	$	275,300
Liability balance by claim category:
Open claims	$	37,856	$	42,700
Future unasserted claims		204,651		232,600
Total asbestos-related liabilities	$	242,507	$	275,300

U.S. Net Asbestos - Related Provision - Table

	Quarter Ended September 30,				Nine Months Ended September 30,
		2013		2012		2013		2012
Provision for revaluation	$	2,000	$	2,000	$	6,000	$	5,997
Gain on the settlement of coverage litigation		-		-		(15,750)		-
Net asbestos-related (gain)/provision	$	2,000	$	2,000	$	(9,750)	$	5,997

U.S. Asbestos-Related Payments And Insurance Settlement Proceeds- Table

	Quarter Ended September 30,				Nine Months Ended September 30,
		2013		2012		2013		2012
Asbestos litigation, defense and case resolution payments	$	12,400	$	12,100	$	38,800	$	40,700
Insurance proceeds		(15,500)		(15,800)		(43,800)		(37,500)
Net asbestos-related (proceeds)/payments	$	(3,100)	$	(3,700)	$	(5,000)	$	3,200

United Kingdom [Member]

Asbestos-Related Assets and Liabilities - Table

U.K. Asbestos	September 30, 2013		December 31, 2012
Asbestos-related assets:
Accounts and notes receivable-other	$	1,021	$	1,022
Asbestos-related insurance recovery receivable		27,993		29,687
Total asbestos-related assets	$	29,014	$	30,709
Asbestos-related liabilities:
Accrued expenses	$	1,021	$	1,022
Asbestos-related liability		30,252		31,950
Total asbestos-related liabilities	$	31,273	$	32,972
Liability balance by claim category:
Open claims	$	6,177	$	7,843
Future unasserted claims		25,096		25,129
Total asbestos-related liabilities	$	31,273	$	32,972

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Business Segments (Narrative) (Details) (Global Power Group [Member], USD $) In Thousands, unless otherwise specified	3 Months Ended
	Mar. 31, 2013	Dec. 31, 2012
Global Power Group [Member]
Asset Impairment Charge	$ 3,919	$ 11,455

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Discontinued Operations (Narrative)(Details) (USD $) In Thousands, unless otherwise specified	3 Months Ended		9 Months Ended		3 Months Ended
	Sep. 30, 2013	Sep. 30, 2012	Sep. 30, 2013	Sep. 30, 2012	Mar. 31, 2013 Global Power Group [Member]	Dec. 31, 2012 Global Power Group [Member]
Asset Impairment Charge					$ 3,919	$ 11,455
Operating revenues related to discontinued operations	3,991	5,936	17,053	18,006
Recognized gain in discontinued operations	$ 300		$ 300

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Business Segments (Income/Loss from Discontinued Operations) (Details) (USD $) In Thousands, unless otherwise specified	3 Months Ended				9 Months Ended
	Sep. 30, 2013		Sep. 30, 2012		Sep. 30, 2013		Sep. 30, 2012
EBITDA from discontinued operations	$ 1,760		$ 752		$ 4,184		$ 2,779
Less: Interest expense	0		0		0		0
Less: Depreciation and amortization	0	[1]	1,197	[1]	3,919	[1]	3,630	[1]
Income/(loss) from discontinued operations before income taxes	1,760		(445)		265		(851)
Less: Provision for income taxes	0		0		0		0
Income/(loss) from discontinued operations	$ 1,760		$ (445)		$ 265		$ (851)

[1] During the nine months ended September 30, 2013, we recorded an impairment charge of $3,919 at our Camden, New Jersey waste-to-energy facility which was recorded as depreciation expense within income/(loss) from discontinued operations. Please refer to Note 13 for further information.

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Goodwill and Other Intangible Assets (Net carrying amount of goodwill by geographic region) (Details) (USD $) In Thousands, unless otherwise specified	Sep. 30, 2013	Dec. 31, 2012
Goodwill	$ 168,720	$ 133,518
Global E and C Group [Member]
Goodwill	92,964	59,388
Global E and C Group [Member] | North America [Member]
Goodwill	85,017	55,962
Global E and C Group [Member] | Asia [Member]
Goodwill	752	858
Global E and C Group [Member] | Europe [Member]
Goodwill	6,627	2,568
Global E and C Group [Member] | Middle East [Member]
Goodwill	568	0
Global Power Group [Member]
Goodwill	75,756	74,130
Global Power Group [Member] | North America [Member]
Goodwill	4,266	4,266
Global Power Group [Member] | Asia [Member]
Goodwill	0	0
Global Power Group [Member] | Europe [Member]
Goodwill	71,490	69,864
Global Power Group [Member] | Middle East [Member]
Goodwill	$ 0	$ 0

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Litigation and Uncertainties (UK Asbestos related assets and liabilities - Table) (Details) (USD $) In Thousands, unless otherwise specified	Sep. 30, 2013	Dec. 31, 2012
Asbestos-related assets:
Asbestos related insurance recovery receivable	$ 114,188	$ 132,438
Asbestos-related liabilities:
Asbestos-related liability	237,632	259,350
United Kingdom [Member]
Asbestos-related assets:
Accounts and notes receivable-other	1,021	1,022
Asbestos related insurance recovery receivable	27,993	29,687
Total asbestos-related assets	29,014	30,709
Asbestos-related liabilities:
Accrued expenses	1,021	1,022
Asbestos-related liability	30,252	31,950
Total asbestos-related liabilities	31,273	32,972
Liability balance by claim category:
Open claims	6,177	7,843
Future unasserted claims	25,096	25,129
Total asbestos-related liabilities	$ 31,273	$ 32,972

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Borrowings (Tables)

9 Months Ended

Sep. 30, 2013

Borrowings [Abstract]

Components of Long-Term Debt- Table

			September 30, 2013						December 31, 2012
			Current		Long-term		Total		Current		Long-term		Total
Capital Lease Obligations			$	2,782	$	51,946	$	54,728	$	2,545	$	53,780	$	56,325
Special-Purpose Limited Recourse Project Debt:
	FW Power S.r.l.			8,961		58,529		67,490		9,215		61,575		70,790
	Energia Holdings, LLC at 11.443% interest,
		due April 15, 2015		2,040		5,355		7,395		1,912		7,396		9,308
Subordinated Robbins Facility Exit Funding Obligations:
	1999C Bonds at 7.25% interest, due October 15, 2024			-		1,283		1,283		-		1,283		1,283
Total			$	13,783	$	117,113	$	130,896	$	13,672	$	124,034	$	137,706
Estimated fair value							$	145,800					$	155,718

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CONSOLIDATED STATEMENT OF CHANGES IN EQUITY (USD $) In Thousands	Total	Registered Shares [Member]	Paid-in Capital [Member]	Retained Earnings [Member]	Accumulated Other Comprehensive Loss [Member]	Treasury Shares [Member]	Total Foster Wheeler AG Shareholders' Equity [Member]	Noncontrolling Interests [Member]
Balance at Dec. 31, 2011	$ 735,672	$ 321,181	$ 606,053	$ 699,971	$ (530,068)	$ (409,390)	$ 687,747	$ 47,925
Net income	140,439			129,727			129,727	10,712
Other comprehensive income/(loss), net of tax	12,372				12,064		12,064	308
Issuance of registered shares upon exercise of stock options	735	147	588				735
Issuance of registered shares upon vesting of restricted awards		679	(679)
Distributions to noncontrolling interests	(12,505)							(12,505)
Share-based compensation expense	11,712		11,712				11,712
Excess tax shortfall related to share-based compensation	(61)		(61)				(61)
Repurchase of registered shares	(50,921)					(50,921)	(50,921)
Retirement of registered shares		(52,885)	(356,505)			409,390
Balance at Sep. 30, 2012	837,443	269,122	261,108	829,698	(518,004)	(50,921)	791,003	46,440
Balance at Dec. 31, 2012	757,393	269,633	266,943	835,993	(567,603)	(90,976)	713,990	43,403
Net income	138,161			134,338			134,338	3,823
Other comprehensive income/(loss), net of tax	4,165				4,837		4,837	(672)
Issuance of registered shares upon exercise of stock options	4,293	637	3,656				4,293
Issuance of registered shares upon vesting of restricted awards		952	(952)
Distributions to noncontrolling interests	(12,579)							(12,579)
Share-based compensation expense	10,400		10,400				10,400
Excess tax shortfall related to share-based compensation	(123)		(123)				(123)
Repurchase of registered shares	(150,131)					(150,131)	(150,131)
Retirement of registered shares		(13,608)	(77,368)			90,976
Balance at Sep. 30, 2013	$ 751,579	$ 257,614	$ 202,556	$ 970,331	$ (562,766)	$ (150,131)	$ 717,604	$ 33,975

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Summary of Significant Accounting Policies

9 Months Ended

Sep. 30, 2013

Summary of Significant Accounting Policies [Abstract]

Summary of Significant Accounting Policies

1. Summary of Significant Accounting Policies

Basis of Presentation — The fiscal year of Foster Wheeler AG ends on December 31 of each calendar year. Foster Wheeler AG's fiscal quarters end on the last day of March, June and September. The fiscal years of our non-U.S. operations are the same as the parent's. The fiscal year of our U.S. operations is the 52- or 53-week annual accounting period ending on the last Friday in December.

The accompanying consolidated financial statements are unaudited. In the opinion of management, all adjustments necessary for a fair presentation of such financial statements have been included. Such adjustments only consisted of normal recurring items. Interim results are not necessarily indicative of results for a full year.

The consolidated financial statements and notes are presented in accordance with the requirements of Form 10-Q and do not contain certain information included in our Annual Report on Form 10-K for the year ended December 31, 2012 (“2012 Form 10-K”), filed with the Securities and Exchange Commission on March 1, 2013. The consolidated balance sheet as of December 31, 2012 was derived from the audited financial statements included in our 2012Form 10-K, but does not include all disclosures required by accounting principles generally accepted in the United States of America for annual consolidated financial statements.

Certain prior period amounts have been reclassified to conform to the current period presentation. These reclassifications include the presentation of our Statement of Comprehensive Income as a result of our adoption of “ASU No. 2013-02, Comprehensive Income (Topic 220): Reporting of Amounts Reclassified Out of Accumulated Other Comprehensive Income”, or ASU No. 2013-02. ASU No. 2013-02was issued by the Financial Accounting Standards Board in February 2013. The standard requires disclosure of the effects on the line items of net income for significant amounts reclassified out of accumulated other comprehensive income and a cross-reference to other disclosures when a portion of the amount reclassified out of accumulated other comprehensive income is initially transferred to a balance sheet account (e.g., contracts in process or billings in excess of costs and estimated earnings on uncompleted contracts for pension-related amounts) instead of directly to income or expense. The adoption of this standard did not have an impact on our results of operations, financial position or cash flows.

Reclassifications from accumulated other comprehensive loss related to cash flow hedges amounted to losses of $741 and $2,356during the quarter and nine months ended September 30, 2013, respectively, and $679 and $1,717 during the quarter and nine months ended September 30, 2012, respectively.  These losses included amounts related to our consolidated entities and our proportionate share of the impact from interest rate swap contracts in cash flow hedging relationships held by our equity method investees.  Amounts that are reclassified from accumulated other comprehensive loss related to cash flow hedges from our consolidated entities are recognized within interest expense on the consolidated statement of operations, whereas amounts related to our equity method investees are recognized within equity earnings in other income, net on the consolidated statement of operations. Please refer to Note 8 for further information.

Reclassifications from accumulated other comprehensive loss related to pension and other postretirement benefits are included as a component of net periodic pension cost.  Please refer to Note 6 for further information.

The tax effect related to foreign currency translation adjustments was inconsequential during the quarters and nine months ended September 30, 2013 and 2012.

Reclassifications also include the presentation of our former waste-to-energy business as a result of its classification as held-for-sale and, in turn, discontinued operations. Please refer to Note 13 for further information.

The consolidated financial statements include the accounts of Foster Wheeler AG and all U.S. and non-U.S. subsidiaries, as well as certain entities in which we have a controlling interest. Intercompany transactions and balances have been eliminated. See “—Variable Interest Entities” below for further information related to the consolidation of variable interest entities.

Use of Estimates — The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities at the date of the financial statements and revenues and expenses during the periods reported. Actual results could differ from those estimates. Changes in estimates are reflected in the periods in which they become known. Significant estimates are used in accounting for long-term contracts including estimates of total costs, progress toward completion and customer and vendor claims, employee benefit plan obligations and share-based compensation plans. In addition, we also use estimates when accounting for uncertain tax positions and deferred taxes, asbestos liabilities and expected recoveries and when assessing goodwill for impairment, among others.

Revenue Recognition on Long-Term Contracts — Revenues and profits on long-term contracts are recorded under the percentage-of-completion method.

Progress towards completion on fixed-price contracts is measured based on physical completion of individual tasks for all contracts with a value of $5,000 or greater. For contracts with a value less than $5,000, progress toward completion is measured based on the ratio of costs incurred to total estimated contract costs (the cost-to-cost method).

Progress towards completion on cost-reimbursable contracts is measured based on the ratio of quantities expended to total forecasted quantities, typically man-hours. Incentives are also recognized on a percentage-of-completion basis when the realization of an incentive is assessed as probable. We include flow-through costs consisting of materials, equipment or subcontractor services as both operating revenues and cost of operating revenues on cost-reimbursable contracts when we have overall responsibility as the contractor for the engineering specifications and procurement or procurement services for such costs. There is no contract profit impact of flow-through costs as they are included in both operating revenues and cost of operating revenues.

Contracts in process are stated at cost, increased for profits recorded on the completed effortor decreased for estimated losses, less billings to the customer and progress payments on uncompleted contracts. A full provision for loss contracts is made at the time the loss becomes probable regardless of the stage of completion.

At any time, we have numerous contracts in progress, all of which are at various stages of completion. Accounting for revenues and profits on long-term contracts requires estimates of total contract costs and estimates of progress toward completion to determine the extent of revenue and profit recognition. These estimates may be revised as additional information becomes available or as specific project circumstances change. We review all of our material contracts on a monthly basis and revise our estimates as appropriate for developments such as earning project incentive bonuses, incurring or expecting to incur contractual liquidated damages for performance or schedule issues, providing services and purchasing third-party materials and equipment at costs differing from those previously estimated and testing completed facilities, which, in turn, eliminates or confirms completion and warranty-related costs. Project incentives are recognized when it is probable they will be earned. Project incentives are frequently tied to cost, schedule and/or safety targets and, therefore, tend to be earned late in a project's life cycle.

Changes in estimated final contract revenues and costs can either increase or decrease the final estimated contract profit. In the period in which a change in estimate is recognized, the cumulative impact of that change is recorded based on progress achieved through the period of change. The following table summarizes the number of separate projects that experienced final estimated contract profit revisions with an impact on contract profit in excess of $1,000 relating to the revaluation of work performed in prior periods:

		Quarter Ended September 30,				Nine Months Ended September 30,
			2013		2012		2013		2012
Number of separate projects			10		12		28		27
Net increase in contract profit from the regular
	revaluation of final estimated contract profit revisions	$	30,200	$	22,700	$	74,800	$	58,000

The changes in final estimated contract profit revisions for our Global Power Group were increased during the nine months ended September 30, 2012for a favorable settlement with a subcontractor of approximately $6,900 recognized in the first quarter of 2012.The changes in final estimated contract profit revisions for our Global E&C Group and our financial results did not include an increase in final estimated contract profit of approximately $5,300 during the quarter and nine months ended September 30, 2012. The correction was recorded in the quarter ended December 31, 2012 as it was not material to the financial results for the quarter and nine months ended September 30, 2012 (the periods in which it should have been recorded), nor was it material to the financial results for the year ended December 31, 2012.

Please see Note 11 for further information related to changes in final estimated contract profitand the impact on business segment results.

Claims are amounts in excess of the agreed contract price (or amounts not included in the original contract price) that we seek to collect from customers or others for delays, errors in specifications and designs, contract terminations, disputed or unapproved change orders as to both scope and price or other causes of unanticipated additional costs. We record claims as additional contract revenue if it is probable that the claims will result in additional contract revenue and if the amount can be reliably estimated. These two requirements are satisfied by the existence of all of the following conditions: the contract or other evidence provides a legal basis for the claim; additional costs are caused by circumstances that were unforeseen at the contract date and are not the result of deficiencies in our performance; costs associated with the claim are identifiable or otherwise determinable and are reasonable in view of the work performed; and the evidence supporting the claim is objective and verifiable. If such requirements are met, revenue from a claim may be recorded only to the extent that contract costs relating to the claim have been incurred, which can include amounts from unapproved change orders when the two requirements described above are met. Unapproved change orders or similar items subject to uncertainty that do not meet the two requirements described above are expensed without the recognition of additional contract revenue. Costs attributable to claims are treated as costs of contract performance as incurred and are recorded in contracts in process. Our consolidated financial statements included commercial claims of $4,600 and $8,800 as of September 30, 2013 and December 31, 2012, respectively,of which substantially all costs had been incurred as of September 30, 2013 and December 31, 2012.

In certain circumstances, we may defer pre-contract costs when it is probable that these costs will be recovered under a future contract. Such deferred costs would then be included in contract costs upon execution of the anticipated contract. In the event that we defer pre-contract costs and we are not successful in obtaining the contract, we write off the deferred costs through our consolidated statement of operations in the period when we no longer assess recoverability of such costs as probable. Deferred pre-contract costs were inconsequentialas of September 30, 2013 and December 31, 2012.

Certain special-purpose subsidiaries in our Global Power Group business segment are reimbursed by customers for their costs ofbuilding and operating certain facilities over the lives of the corresponding service contracts. Depending on the specific legal rights and obligations under these arrangements, in some cases those reimbursements are treated as operating revenues at gross value and other cases as a reduction of cost.

Trade Accounts Receivable — Trade accounts receivable represent amounts billed to customers. We assess the need for an allowance for doubtful accounts on a project-by-project basis, which includes the consideration of security instruments that provide us protection in the event of non-payment. When there is a risk of non-payment related to customer credit risk, we record an allowance for doubtful accounts. Because of the nature of our customer base and our rigorous customer credit risk assessment process prior to entering into contracts, the level of our allowance for doubtful accounts is typically a very small percentage of our gross accounts receivable balance. To the extent that there is a risk of non-payment related to commercial or performance issues, we record an allowance against the valuation of contract work in progress within the contract.

In accordance with terms under our long-term contracts, our customers may withhold certain percentages of such billings until completion and acceptance of the work performed, which we refer to as retention receivables. Final payment of retention receivables mightnot be received within a one-year period. In conformity with industry practice, however, the full amount of accounts receivable, including such amounts withheld, are included in current assets on the consolidated balance sheet.We have not recorded a provision for the outstanding retention receivable balances as of September 30, 2013 or December 31, 2012.

Variable Interest Entities—We sometimes form separate legal entities such as corporations, partnerships and limited liability companies in connection with the execution of a single contract or project. Upon formation of each separate legal entity, we perform an evaluation to determine whether the new entity is a variable interest entity, or VIE, and whether we are the primary beneficiary of the new entity, which would require us to consolidate the new entity in our financial results. We reassess our initial determination on whether the entity is a VIE upon the occurrence of certain events and whether we are the primary beneficiary as outlined in current accounting guidelines. If the entity is not a VIE, we determine the accounting for the entity under the voting interest accounting guidelines.

An entity is determined to be a VIE if either (a) the total equity investment is not sufficient for the entity to finance its own activities without additional subordinated financial support, (b) characteristics of a controlling financial interest are missing (such as the ability to make decisions through voting or other rights or the obligation to absorb losses or the right to receive benefits), or (c) the voting rights of the equity holders are not proportional to their obligations to absorb losses of the entity and/or their rights to receive benefits of the entity, and substantially all of the entity's activities either involve or are conducted on behalf of an investor that has disproportionately few voting rights.

As of September 30, 2013 and December 31, 2012, we participated in certain entities determined to be VIEs, including a gas-fired cogeneration facility in Martinez, California and a refinery/electric power generation project in Chile.We consolidate the operations of the Martinez project while we record our participation in the project in Chile on the equity method of accounting.

Please see Note 3 for further information regarding our participation in these projects.

Fair Value Measurements—Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. Financial Accounting Standards Board Accounting Standards Codification, or FASB ASC, 820-10 defines fair value, establishes a three level fair value hierarchy that prioritizes the inputs used to measure fair valueand provides guidance on required disclosures about fair value measurements. The fair value hierarchy gives the highest priority to unadjusted quoted prices in active markets for identical assets or liabilities and the lowest priority to unobservable inputs.

Our financial assets and liabilities that are recorded at fair value on a recurring basis consist primarily of the assets or liabilities arising from derivative financial instruments and defined benefit pension plan assets. See Note 8for further information regarding our derivative financial instruments.

The following methods and assumptions were used to estimate the fair value of each class of financial instruments for which it is practicable to estimate fair value:

Financial instruments valued independent of the fair value hierarchy:

• Cash, Cash Equivalents and Restricted Cash— The carrying value of our cash, cash equivalents and restricted cash approximates fair value because of the demand nature of many of our deposits or short-term maturity of these instruments.

  Financial instruments valued within the fair value hierarchy:

• Long-term Debt — We estimate the fair value of our long-term debt (including current installments) based on the quoted market prices for the same or similar issues or on the current rates offered for debt of the same remaining maturitiesusing level 2 inputs.
• Foreign Currency Forward Contracts — We estimate the fair value of foreign currency forward contracts by obtaining quotes from financial institutions or market transactions in either the listed or over-the-counter markets. Our estimate of the fair value of foreign currency forward contracts also includes an assessment of non-performance by our counterparties. We further corroborate the valuations with observable market data using level 2 inputs.
• Interest Rate Swaps— We estimate the fair value of our interest rate swaps based on quotes obtained from financial institutions, which we further corroborate with observable market datausing level 2 inputs.
• Defined Benefit Pension Plan Assets — We estimate the fair value of investments in equity securities at each year-end based on quotes obtained from financial institutions. The fair value of investments in commingled funds, invested primarily in debt and equity securities, is based on the net asset values communicated by the respective asset manager. We further corroborate the above valuations with observable market data using level 1 and 2 inputs. Additionally, we hold investments in private investment funds that are valued at net asset value as communicated by the asset manager using level 3 unobservable market data inputs.

Retirement of Shares under Share Repurchase Program — Under Swiss law, the cancellation of shares previously repurchased under our share repurchase program must be approved by our shareholders. Repurchased shares remain as treasury shares on our balance sheet until cancellation.

Any repurchases will be made at our discretion in compliance with applicable securities laws and other legal requirements and will depend on a variety of factors, including market conditions, share price and other factors.   The program does not obligate us to acquire any particular number of shares. The program has no expiration date and may be suspended or discontinued at any time.

All treasury shares are carried at cost on the consolidated balance sheet until the cancellation of the shares has been approved by our shareholders and the cancellation is registered with the commercial register of the Canton of Zug in Switzerland. Upon the effectiveness of the cancellation of the shares, the cost of the shares cancelled will be removed from treasury shares on the consolidated balance sheet, the par value of the cancelled shares will be removed from registered shares on the consolidated balance sheet, and the excess of the cost of the treasury shares above par value will be removed from paid-in capital on the consolidated balance sheet.

Once repurchased, treasury shares are no longer considered outstanding, which results in a reduction to the weighted-average number of shares outstanding during the reporting period when calculating earnings per share, as described below.

Earnings per Share — Basic earnings per share amounts have been computed based on the weighted-average number of shares outstanding during the reporting period.

Diluted earnings per share amounts have been based on the combination of the weighted-average number of shares outstanding during the reporting period and the impact of dilutive securities, if any, such as outstanding stock options and the non-vested portion of restricted stock units and performance-based restricted stock units (collectively, “restricted awards”) to the extent such securities are dilutive.

In profitable periods, outstanding stock options have a dilutive effect under the treasury stock method when the average share price for the period exceeds the assumed proceeds from the exercise of the option. The assumed proceeds include the exercise price, compensation cost, if any, for future service that has not yet been recognized in the consolidated statement of operations, and any tax benefits that would be recorded in paid-in capital when the option is exercised. Under the treasury stock method, the assumed proceeds are assumed to be used to repurchase shares in the current period. The dilutive impact of the non-vested portion of restricted awards is determined using the treasury stock method, but the proceeds include only the unrecognized compensation cost and tax benefits as assumed proceeds.

The computations of basic and diluted earnings per share were as follows:

		Quarter Ended September 30,				Nine Months Ended September 30,
			2013		2012		2013		2012
Income from continuing operations attributable
	to Foster Wheeler AG	$	48,853	$	58,667	$	134,073	$	130,578
Basic weighted-average number of shares outstanding			98,172,200		107,065,999		100,830,719		107,558,489
Effect of dilutive securities			431,386		253,963		495,874		298,879
Diluted weighted-average number of shares outstanding			98,603,586		107,319,962		101,326,593		107,857,368
Income from continuing operations per share:
	Basic	$	0.50	$	0.55	$	1.33	$	1.22
	Diluted	$	0.50	$	0.55	$	1.32	$	1.21

The following table summarizes share-based compensation awards not included in the calculation of diluted earnings per share as the assumed proceeds from those awards, on a per share basis, were greaterthan the average share price for the period, which would result in an antidilutive effect on diluted earnings per share:

	Quarter Ended September 30,		Nine Months Ended September 30,
	2013	2012	2013	2012
Stock options	1,356,167	2,809,894	1,393,499	2,809,894
Performance-based restricted share units	1,144,694	-	1,144,694	-

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Goodwill and Other Intangible Assets

9 Months Ended

Sep. 30, 2013

Goodwill and Other Intangible Assets

Goodwill and Other Intangible Assets

4. Goodwill and Other Intangible Assets

We have tracked accumulated goodwill impairments since the beginning of fiscal year 2002,our date of adoption of the accounting guidelines related to the assessment of goodwill for impairment. There were no accumulated goodwill impairment losses as of that date. The following table provides our net carrying amount of goodwill by geographic region in which our reporting units are located:

	Global E&C Group				Global Power Group
Geographic Regions:	September 30, 2013		December 31, 2012		September 30, 2013		December 31, 2012
North America	$	85,017	$	55,962	$	4,266	$	4,266
Asia		752		858		-		-
Europe		6,627		2,568		71,490		69,864
Middle East		568		-		-		-
Total	$	92,964	$	59,388	$	75,756	$	74,130

During the nine months ended September 30, 2013, our Global E&C Group's goodwill balance included increasesrelated to our acquisitions located in the U.S. and Mexico of $10,571and $18,143, respectively, which were included in the North America geographic region in the table above, and theU.K. of $4,465, portions of which were included in both the Europe and Middle East geographic regions in the table above.Our Global E&C Group's goodwill balance also includes a customary working capital adjustment of $2,026 for our 2012 acquisition, which is included in the North America geographic region in the table above.The remaining changes in each of the regions were the result of the impact of foreign currency translation adjustments. Please see Note 2 for further information regardingthese acquisitions.

The following table sets forth amounts relating to our identifiable intangible assets:

		September 30, 2013						December 31, 2012
		Gross				Net		Gross				Net
		Carrying		Accumulated		Carrying		Carrying		Accumulated		Carrying
		Amount		Amortization		Amount		Amount		Amortization		Amount
Patents		$	41,325	$	(33,863)	$	7,462	$	41,103	$	(32,273)	$	8,830
Trademarks			66,034		(33,342)		32,692		64,582		(31,483)		33,099
Customer relationships,
	pipeline and backlog		96,109		(23,091)		73,018		72,050		(14,531)		57,519
Technology			6,748		(1,687)		5,061		6,594		(942)		5,652
Total		$	210,216	$	(91,983)	$	118,233	$	184,329	$	(79,229)	$	105,100

As of September 30,2013, the net carrying amounts of our identifiable intangible assets were $46,863for our Global Power Group and $71,370 for our Global E&C Group. Amortization expense related to identifiable intangible assets is recorded within cost of operating revenues on the consolidated statement of operations. Amortization expense related to assets other than identifiable intangible assets was not material in thenine months ended September 30, 2013and 2012.

The following table details amortization expense related to identifiable intangible assets by period:

		Quarter Ended September 30,				Nine Months Ended September 30,
			2013		2012		2013		2012
Amortization expense		$	4,291	$	2,712	$	12,330	$	8,264
Approximate full year amortization expense for years:
	2013							$	16,900
	2014								17,000
	2015								12,500
	2016								9,900
	2017								9,500

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Business Combinations

9 Months Ended

Sep. 30, 2013

Business Combination

Business Combinations

2. Business Combinations

In June 2013, we acquired all of the outstanding shares of a privately held upstream consultancy business located in the United Kingdom and additional related assets in the Middle East. This acquired businessspecializes in field development and project decision support, focused on the evaluation and implementation of oil and gas field developments covering greenfield and brownfield assets.At closing, we paid cash consideration net of cash acquired of £6,300 (approximately $9,700 based on the exchange rate in effect on the closing date), subject to customary working capital adjustments, as specified in the sale and purchase agreement. The sale and purchase agreement also included an earnout provision for additional consideration with an estimated maximum of £3,000 (approximately $4,600 based on the exchange rate in effect on September 30, 2013), depending on the acquired business' performance, as defined in the sale and purchase agreement, over a period of approximately 3 and a half years subsequent to the acquisition date. Any amounts recognized under theearnout will be reported as compensation expense in periods subsequent to the acquisition date rather than as part of the purchase price for the business.  Our consolidated balance sheet as of September 30, 2013 included a preliminary purchase price allocation for this acquisition as we are in process of finalizing the valuation of the individual assets acquired and liabilities assumed. The preliminary purchase price allocation was based on the best estimate of management and we expect to finalize the purchase price allocation upon completion of an independent appraisal over the next several months, but no later than one year from the acquisition date. The preliminary purchase price allocation and pro forma impact assuming the acquisition had occurred as of the beginning of 2012 were not significant to our consolidated financial statements. As a result of the preliminary purchase price allocation, we recognized goodwill of $4,465 and other intangible assets of $5,307 related to this acquisition.The assets, liabilities and results of operations of the acquired business are included within our Global Engineering and Construction Group (“Global E&C Group”) business segment.

Also in June 2013, we acquired all of the outstanding shares of a privately held engineering and project management business located in Mexico with experience in both offshore and onshore upstream oil and gas, downstream oil and gasand power projects.At closing, we paid cash consideration net of cash acquired of approximately $15,900, subject to customary working capital adjustments, as specified in the sale and purchase agreement.Our consolidated balance sheet as of September 30, 2013 included a preliminary purchase price allocation for this acquisition as we are in process of finalizing the valuation of the individual assets acquired and liabilities assumed. The preliminary purchase price allocation was based on the best estimate of management and we expect to finalize the purchase price allocation upon completion of an independent appraisal over the next several months, but no later than one year from the acquisition date. The preliminary purchase price allocation and pro forma impact assuming the acquisition had occurred as of the beginning of 2012 were not significant to our consolidated financial statements.As part of our post-acquisition valuation of assets and liabilities acquired during the quarter ended September 30, 2013, we recorded additional assets and liabilities of $20,782 and $32,647, respectively, and recorded a corresponding net increase to goodwill of $11,865. As a result of the preliminary purchase price allocation, we recognized goodwill of $18,143 and other intangible assets of $7,100 related to this acquisition.The assets, liabilities and results of operations of the acquired business are included within our Global E&C Group business segment.

During our U.S. operations' fiscal first quarter of 2013, we acquired all of the outstanding shares of a privately held U.S.-based business that specializes in the management of construction and commissioning of pharmaceutical and biotech facilities and which also has the capabilities to manage the full engineering, procurement and construction of such facilities. In addition, the acquired business has the ability to provide modular project delivery services on a worldwide basis through its participation in a project-services partnership.At closing, we paid cash consideration net of cash acquired of approximately $25,100. The sale and purchase agreement also included an earnout provision for additional consideration with an estimated maximum of approximately $6,600, depending on the acquired business' performance, as defined in the sale and purchase agreement, over a period of approximately 5 years subsequent to the acquisition date.  Any amounts recognized under the earnoutwill be reported as compensation expense in periods subsequent to the acquisition date rather than as part of the purchase price for the business. The purchase price allocation and pro forma impact assuming the acquisition had occurred as of the beginning of 2012were not significant to our consolidated financial statements.  As a result of the purchase price allocation, we recognized goodwill of $10,571 and other intangible assets of $13,980 related to this acquisition.The assets, liabilities and results of operations of the acquired business are included within our Global E&C Groupbusiness segment.

In November 2012, we acquired all of the outstanding shares of a privately held multi-discipline full service engineering, procurement, and construction management businesslocated in North America. At closing, we paid cash consideration net of cash acquired of approximately $70,800. The sale and purchase agreement also included an earnout provision for additional consideration with an estimated maximum of approximately $20,000, depending on the acquired business' performance, as defined in the sale and purchase agreement, over a period of approximately 5 years subsequent to the acquisition date. The earnout will be reported as compensation expense in periods subsequent to the acquisition date rather than as part of the purchase price for the business.  As a result of the purchase price allocation, we recognized goodwill of $18,708 and other intangible assets of $42,921 related to this acquisition. The assets, liabilities and results of operations of the acquired business are included within our Global E&C Group business segment.

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Investments (Schedule of Variable Interest Entities - Table) (Details) (USD $) In Thousands, unless otherwise specified	Sep. 30, 2013	Dec. 31, 2012
Investments
Current assets	$ 5,425	$ 15,610
Other assets (primarily buildings and equipment)	36,719	39,194
Current liabilities	2,565	4,825
Other liabilities	4,484	5,452
Net assets	$ 35,095	$ 44,527

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Derivative Financial Instruments (Tables)

9 Months Ended

Sep. 30, 2013

Derivative Instruments and Hedging Activities Disclosure [Abstract]

Fair Value of Derivative Financial Instruments - Table

Fair Values of Derivative Financial Instruments
					Asset Derivatives						Liability Derivatives
			Balance Sheet		September 30,		December 31,		Balance Sheet		September 30,		December 31,
			Location		2013		2012		Location		2013		2012
Derivatives designated as
		hedging instruments:
	Interest rate swap
		contracts	Other assets		$	-	$	-	Other long-term liabilities		$	8,809	$	10,490
Derivatives not designated
		as hedging instruments:
	Foreign currency		Contracts in process or						Contracts in process or
		forward contracts		billings in excess of costs						billings in excess of costs
				and estimated earnings on						and estimated earnings on
				uncompleted contracts		7,603		6,040		uncompleted contracts		1,663		4,895
	Foreign currency
		forward contracts	Other accounts receivable			335		1,357	Accounts payable			481		29
Total derivatives					$	7,938	$	7,397			$	10,953	$	15,414

Amount of Gain/(Loss) Recognized In Income On Derivatives - Table

	Location of Gain/(Loss)	Amount of Gain/(Loss) Recognized in Income on Derivatives
Derivatives Not Designated as	Recognized	Quarter Ended September 30,				Nine Months Ended September 30,
Hedging Instruments	in Income on Derivatives		2013		2012		2013		2012
Foreign currency forward contracts	Cost of operating revenues	$	5,616	$	1,692	$	1,700	$	1,192
Foreign currency forward contracts	Other deductions, net		121		753		(1,402)		831
Total		$	5,737	$	2,445	$	298	$	2,023

Cash Flow Hedge Gain/(Loss) Reclassified to Interest Expense, Net - Table

		Quarter Ended September 30,				Nine Months Ended September 30,
			2013		2012		2013		2012
Unrealized loss recognized in other comprehensive income		$	(817)	$	(1,766)	$	(6)	$	(3,551)
Loss reclassified from accumulated other comprehensive loss
	to interest expense		630		572		1,885		1,507

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Discontinued Operations (Tables)

9 Months Ended

Sep. 30, 2013

Discontinued Operations [Abstract]

Schedule of Assets and Liabilities Associated with our Discontinued Operations-Table

		December 31, 2012
Assets:
Trade accounts and notes receivable, net		$	1,482
Other current assets			23
	Current assets of discontinued operations		1,505
Land, buildings and equipment, net			48,739
Restricted cash			840
	Long-term assets of discontinued operations	$	49,579
Liabilities:
Accounts payable		$	1,814
Accrued expenses			595
Advance payments			745
	Liabilities of discontinued operations	$	3,154

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Discontinued Operations (Schedule of Assets and Liabilities for Discontinued Operations - Table)(Details) (USD $) In Thousands, unless otherwise specified	Sep. 30, 2013	Dec. 31, 2012
Assets:
Trade accounts and notes receivable,net		$ 1,482
Other current assets		23
Current assets of discontinued operations	0	1,505
Land, buildings and equipment, net		48,739
Restricted cash		840
Long-term assets of discontinued operations	0	49,579
Liabilities:
Accounts payable		1,814
Accrued expenses		595
Advance payments		745
Current liabilities of discontinued operations	$ 0	$ 3,154

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Business Combinations (Narrative) (Details)	9 Months Ended
	Sep. 30, 2013
U.S.- based firm that specializes in management of construction and commissioning of pharmaceutical and biotech facilities acquisition [Member]
Date of acquisition	Mar. 31, 2013
Description of acquired entity	U.S.-based business that specializes in the management of construction and commissioning of pharmaceutical and biotech facilities and which also has the capabilities to manage the full engineering, procurement and construction of such facilities. In addition, the acquired business has the ability to provide modular project delivery services on a worldwide basis through its participation in a project-services partnership.
Description of purchase agreement	At closing, we paid cash consideration net of cash acquired of approximately $25,100. The sale and purchase agreement also included an earnout provision for additional consideration with an estimated maximum of approximately $6,600, depending on the acquired business’ performance, as defined in the sale and purchase agreement, over a period of approximately 5 years subsequent to the acquisition date.
Goodwill and intangible assets, business acquisition	As a result of the purchase price allocation, we recognized goodwill of $10,571 and other intangible assets of $13,980 related to this acquisition.
Engineering procurement and construction management acquisition [Member]
Date of acquisition	Nov. 30, 2012
Description of acquired entity	engineering, procurement, and construction management business
Description of purchase agreement	At closing, we paid cash consideration net of cash acquired of approximately $70,800. The sale and purchase agreement also included an earnout provision for additional consideration with an estimated maximum of approximately $20,000, depending on the acquired business’ performance, as defined in the sale and purchase agreement, over a period of approximately 5 years subsequent to the acquisition date.
Goodwill and intangible assets, business acquisition	As a result of the purchase price allocation, we recognized goodwill of $18,708 and other intangible assets of $42,921 related to this acquisition. The assets, liabilities and results of operations of the acquired business are included within our Global E&C Group business segment.
Engineering and project management business [Member]
Date of acquisition	Jun. 30, 2013
Description of acquired entity	engineering and project management business located in Mexico with experience in both offshore and onshore upstream oil and gas, downstream oil and gas and power projects.
Description of purchase agreement	At closing, we paid cash consideration net of cash acquired of approximately $15,900, subject to customary working capital adjustments, as specified in the sale and purchase agreement.
Goodwill and intangible assets, business acquisition	As part of our post-acquisition valuation of assets and liabilities acquired during the quarter ended September 30, 2013, we recorded additional assets and liabilities of $20,782 and $32,647, respectively, and recorded a corresponding net increase to goodwill of $11,865. As a result of the preliminary purchase price allocation, we recognized goodwill of $18,143 and other intangible assets of $7,100 related to this acquisition.
Upstream consultancy business [Member]
Date of acquisition	Jun. 30, 2013
Description of acquired entity	upstream consultancy business located in the United Kingdom and additional related assets in the Middle East. This acquired business specializes in field development and project decision support, focused on the evaluation and implementation of oil and gas field developments covering greenfield and brownfield assets
Description of purchase agreement	At closing, we paid cash consideration net of cash acquired of £6,300 (approximately $9,700 based on the exchange rate in effect on the closing date), subject to customary working capital adjustments, as specified in the sale and purchase agreement. The sale and purchase agreement also included an earnout provision for additional consideration with an estimated maximum of £3,000 (approximately $4,600 based on the exchange rate in effect on September 30, 2013), depending on the acquired business’ performance, as defined in the sale and purchase agreement, over a period of approximately 3 and a half years subsequent to the acquisition date
Goodwill and intangible assets, business acquisition	As a result of the preliminary purchase price allocation, we recognized goodwill of $4,465 and other intangible assets of $5,307 related to this acquisition.

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Litigation and Uncertainties (Narrative) (Details) (USD $) In Thousands, unless otherwise specified	3 Months Ended		9 Months Ended		12 Months Ended
	Sep. 30, 2013 claims	Sep. 30, 2012 claims	Sep. 30, 2013 claims	Sep. 30, 2012 claims	Dec. 31, 2012 claims	Jun. 30, 2013 claims	Jun. 30, 2012 claims	Dec. 31, 2011 claims
Environmental Matters [Member]
Aggregate potential liability, maximum	$ 500		$ 500
Mountain Top [Member]
Project claims arbitration allegations			In February 1988, one of our subsidiaries, Foster Wheeler Energy Corporation (“FWEC”), entered into a Consent Agreement and Order with the USEPA and the Pennsylvania Department of Environmental Protection (“PADEP”) regarding its former manufacturing facility in Mountain Top, Pennsylvania. The order essentially required FWEC to investigate and remediate as necessary contaminants, including trichloroethylene (“TCE”), in the soil and groundwater at the facility. Pursuant to the order, in 1993 FWEC installed a “pump and treat” system to remove TCE from the groundwater. It is not possible at the present time to predict how long FWEC will be required to operate and maintain this system.
Project claims actions taken by parties			In the fall of 2004, FWEC sampled the private domestic water supply wells of certain residences in Mountain Top and identified approximately 30 residences whose wells contained TCE at levels in excess of Safe Drinking Water Act standards. The subject residences are located approximately one mile to the southwest of where the TCE previously was discovered in the soils at the former FWEC facility. Since that time, FWEC, USEPA and PADEP have cooperated in responding to the foregoing. Although FWEC believed the evidence available was not sufficient to support a determination that FWEC was responsible for the TCE in the residential wells, FWEC immediately provided the affected residences with bottled water, followed by water filters, and, pursuant to a settlement agreement with USEPA, it hooked them up to the public water system. Pursuant to an amendment of the settlement agreement, FWEC subsequently agreed with USEPA to arrange and pay for the hookup of several additional residences, even though TCE has not been detected in the wells at those residences.  The hookups to the agreed upon residences have been completed, and USEPA has provided FWEC with a certificate that FWEC has completed its obligations related to the above-described settlement agreement (as amended). FWEC may be required to pay the agencies’ costs in overseeing and responding to the situation. FWEC is also incurring further costs in connection with a Remedial Investigation / Feasibility Study (“RI/FS”) that in March 2009 it agreed to conduct. During the fourth quarter of 2012, FWEC received a USEPA demand under the foregoing agreement for payment of $1,040 of response costs USEPA claims it incurred from the commencement of the RI/FS in April 2009 through February 2012. FWEC questioned the amount of the invoice and based upon discussions with the USEPA, a revised invoice was received on June 17, 2013 for the reduced amount of $1,004. During the third quarter of 2013, FWEC received a USEPA invoice under the foregoing agreement for payment of $258 of response costs USEPA claims it incurred from March 2012 to February 2013. In April 2009, USEPA proposed for listing on the National Priorities List (“NPL”) an area consisting of FWEC’s former manufacturing facility and the affected residences, but it also stated that the proposed listing may not be finalized if FWEC complies with its agreement to conduct the RI/FS. FWEC submitted comments opposing the proposed listing. FWEC has accrued its best estimate of the cost of all of the foregoing, and it reviews this estimate on a quarterly basis. Other costs to which FWEC could be exposed could include, among other things, FWEC’s counsel and consulting fees, further agency oversight and/or response costs, costs and/or exposure related to potential litigation, and other costs related to possible further investigation and/or remediation. At present, it is not possible to determine whether FWEC will be determined to be liable for some or all of the items described in this paragraph or to reliably estimate the potential liability associated with the items. If one or more third-parties are determined to be a source of the TCE, FWEC will evaluate its options regarding the potential recovery of the costs FWEC has incurred, which options could include seeking to recover those costs from those determined to be a source.
Refinery And Petrochemicals Project Arbitration India [Member]
Project claims arbitration filing date			November 2012
Project claims arbitration allegations			we commenced arbitration in India against our client seeking collection of unpaid receivables in excess of £52,000 (approximately $83,900 based on the exchange rate in effect as of September 30, 2013), arising from services performed on a reimbursable basis for our client in connection with our client’s grass roots refinery and petrochemicals project in northeastern India. Our client rejected the claims and notified us of various potential counterclaims that it may be asserting in the arbitration, purportedly totaling in excess of £55,000 (approximately $88,800 based on the exchange rate in effect as of September 30, 2013).
Project claims actions taken by parties			In June 2013, we submitted our detailed statement of claim, and in July 2013 our client submitted its detailed statement of defense and counterclaim. The amount of the counterclaim was increased to approximately £620,000 (approximately $1,000,800 based on the exchange rate in effect as of September 30, 2013) in damages, including among other claims a claim for lost profits due to delay in the execution of the project. The counterclaim concerns a number of alleged issues arising in connection with our execution of the engineering, procurement, and construction management scope of our contract, from the period from contract award until the subsequent transfer by our client of our remaining engineering, procurement and construction management scope to certain lump sum turnkey contractors hired directly by our client. Our client further contends that we are liable for delays to the project and has withheld payment on account of delay liquidated damages and, out of the total claim of £620,000 (approximately $1,000,800 based on the exchange rate in effect as of September 30, 2013) cited above, is seeking damages for lost profits in the amount of £555,000 (approximately $895,900 based on the exchange rate in effect as of September 30, 2013). We strongly dispute these contentions. Any liability for delay damages is capped under the contract at a specified percentage of our contract value, currently equivalent to approximately £11,500 (approximately $18,600 based on the exchange rate in effect as of September 30, 2013), an amount already retained by our client. The contract also excludes liability for consequential damages, including lost profits, and contains an overall cap on liability for claims in the aggregate of up to a specified percentage of our contract value, currently equivalent to approximately £28,800 (approximately $46,500 based on the exchange rate in effect as of September 30, 2013). The unpaid amount for which we are seeking reimbursement in the arbitration may increase should our client continue to withhold amounts from our invoices, as the project is still in execution. The arbitration panel has been formed. Our client moved to dismiss the arbitration as premature under the terms of the contract, and we opposed that motion. The motion has been denied by the panel. Also, pursuant to our request, the panel has scheduled a hearing early in the first quarter of 2014 for our claims for unpaid receivables, along with our client’s counterclaim for a deductive change order in the amount of approximately £21,600 (approximately $34,900 based on the exchange rate in effect as of September 30, 2013). The remaining claims and counterclaims, including our client’s counterclaim for lost profits, are scheduled to be heard late in the fourth quarter of 2014. We cannot predict the ultimate outcome of this matter at this time.
United Kingdom [Member]
Asbestos related open claims number	284		284
Number of asbestos claims brought against United Kingdom	1,043		1,043
Asbestos related liability upon pleural plaque ruling	44,700		44,700
United States [Member]
Asbestos related open claims number	125,250	124,600	125,250	124,600	125,310	124,810	124,680	124,540
Asbestos litigation, defense and case resolution payments	12,400	12,100	38,800	40,700
Provision for revaluation	2,000	2,000	6,000	5,997
Total cumulative indemnity costs paid through the balance sheet date	818,600		818,600
Total cumulative defense costs paid through the balance sheet date	404,500		404,500
Portion of total defense and indemnity costs that represent defense costs	33.00%		33.00%
Historic average combined indemnity and defense cost per resolved claim	3,300		3,300
Expected cash inflows/(outflows) as a result of asbestos liability indemnity and defense payment in excess of issuance settlement proceeds			(1,100)
Average per claim indemnity increase rate					25.00%
Estimated impact on the asbestos related liability from an increase of 25% in the average per claim indemnity settlement amount					42,000
Percentage of the asbestos related liability reserve that would result in an additional expense to be recognized in the statement of operations for a 25% increase in the average asbestos-related claim indemnity settlement amount and assuming no change in the assumptions currently used to estimate the asbestos-related insurance asset					85.00%
Gain on the settlement of coverage litigation	$ 0	$ 0	$ (15,750)	$ 0
United States [Member] | Power Plant Arbitration United States [Member]
Project claims arbitration filing date			In June 2011, a demand for arbitration was filed with the American Arbitration Association by our client’s erection contractor against our client and us in connection with a power plant project in the U.S.  At that time, no details of the erection contractor’s claims were included with the demand. The arbitration panel was formed on September 26, 2012 and a detailed Statement of Claim from the erection contractor was delivered to the panel on October 24, 2012.
Project claims arbitration allegations			According to the claim, the erection contractor is seeking unpaid contract amounts from our client and additional compensation from our client and us for alleged delays, disruptions, inefficiencies, and extra work in connection with the erection of the plant.  We supplied the steam generation equipment for the project under contract with our client, the power plant owner.  The turbine contractor, who supplied the turbine, electricity generator and other plant equipment under a separate contract with the power plant owner, has also been included as a party in the arbitration.
Project claims actions taken by parties			Responsive pleadings to the erection contractor’s pleading were filed by the other parties, including us, on November 28, 2012.  Our pleading denies the erection contractor’s claims against us and asserts cross claims against our client seeking over $14,800 in damages related to delays, out of scope work, and improperly assessed delay liquidated damages. In its pleading, the turbine contractor asserts claims against our client for unpaid contract amounts and additional compensation for extra work and delays. In its capacity as a purported co-assignee of the steam generation equipment supply contract, the turbine contractor joins in the erection contractor’s claims against us for delay-related damages and asserts cross claims against us seeking over $5,000 in non-delay related damages.  In its pleading, our client asserts counter and cross claims for breach of contract and gross negligence against the erection contractor and the turbine contractor. Our client also asserts cross claims against us for any damages our client has incurred, and for indemnification of any damages our client may be required to pay to the erection and turbine contractors, arising out of alleged failures of performance on our part under our steam generation supply contract. We have denied our client’s and the turbine contractor’s cross claims against us. On August 30, 2013, our client filed a petition with the U.S. Bankruptcy Court, for the District of Delaware, seeking to reorganize under Chapter 11 of the U.S. Bankruptcy Code. The filing automatically stayed all proceedings against our client, including the four-party arbitration discussed above. Our client’s filing included a motion seeking authorization for the use of cash collateral to fund its activities during the bankruptcy proceedings. In its motion, our client indicated its intent to draw on performance and retention letters of credit we previously issued in connection with the contract totaling approximately $59,000, contending that the funds were needed to fund the bankruptcy and make repairs to the power plant. We opposed the motion on various grounds, including that any such draw would be unsupported and wrongful, and applied for an order temporarily restraining our client from drawing on the letters of credit, lifting the automatic stay of the arbitration proceeding and transferring the question of our client’s right to draw on our letters of credit back to the arbitration for resolution in the context of the overall dispute. The bankruptcy court granted our application for temporary restraint and scheduled a further hearing on the issue, which on successive applications by our client was adjourned to November 21, 2013. On November 1, 2013, our client filed a motion seeking the bankruptcy court’s approval of proposed debtor-in-possession financing. Based upon the timetable proposed in the motion, it does not appear that the bankruptcy court will decide the question of our client’s right to draw on our letters of credit on November 21, 2013. The date for decision on that question is at present uncertain. The court’s temporary restraint order remains in place while the court’s decision on the draw remains open. We cannot predict the ultimate outcome of this matter at this time.
Project claims damages sought			The erection contractor is seeking approximately $240,000 in damages, exclusive of interest, from our client.  Of this amount, the statement of claim asserts that approximately $150,000 is related to the steam generation equipment, and alleges failure on our part in connection with our performance under our steam generation equipment supply contract; those damages are claimed jointly against us and our client. The claims against us by the erection contractor allege negligence and, in its purported capacity as a third party beneficiary and assignee of our steam generation equipment supply contract, breach of contract.

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Derivative Financial Intruments (Schedule of Interest Rate Derivatives) (Details) (USD $) In Thousands, unless otherwise specified	3 Months Ended		9 Months Ended
	Sep. 30, 2013	Sep. 30, 2012	Sep. 30, 2013	Sep. 30, 2012
Derivative Instruments, Gain (Loss) [Line Items]
Unrealized loss recognized in other comprehensive income	$ (817)	$ (1,766)	$ (6)	$ (3,551)
Loss reclassified from accumulated other comprehensive loss to net income	$ 630	$ 572	$ 1,885	$ 1,507

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Pensions and Other Postretirement Benefits (Pension benefits contributions) (Details) (Non-U.S. Pension Plan [Member], USD $) In Thousands, unless otherwise specified	9 Months Ended
	Sep. 30, 2013
Non-U.S. Pension Plan [Member]
Contributions made through period end	$ 14,900
Remaining contributions expected for fiscal year 2013	5,700
Contributions expected for fiscal year 2013	$ 20,600

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Goodwill and Other Intangible Assets (Intangible assets amortization schedule) (Details) (USD $) In Thousands, unless otherwise specified	3 Months Ended		9 Months Ended
	Sep. 30, 2013	Sep. 30, 2012	Sep. 30, 2013	Sep. 30, 2012
Goodwill and Other Intangible Assets
Amortization expense	$ 4,291	$ 2,712	$ 12,330	$ 8,264
Amortization expense - forecast for 2013	16,900		16,900
Amortization expense - forecast for 2014	17,000		17,000
Amortization expense - forecast for 2015	12,500		12,500
Amortization expense - forecast for 2016	9,900		9,900
Amortization expense - forecast for 2017	$ 9,500		$ 9,500

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CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME (USD $) In Thousands, unless otherwise specified	3 Months Ended		9 Months Ended
	Sep. 30, 2013	Sep. 30, 2012	Sep. 30, 2013	Sep. 30, 2012
CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME
Net income	$ 50,146	$ 62,279	$ 138,161	$ 140,439
Foreign currency translation adjustments:
Foreign currency translation adjustments, net of tax	12,126	15,307	(7,588)	5,987
Cash flow hedges adjustments:
Unrealized loss	(1,456)	(3,088)	(148)	(6,079)
Tax impact	495	1,099	(1)	2,292
Unrealized loss, net of tax	(961)	(1,989)	(149)	(3,787)
Reclassification for losses included in net income (see Note 8 for further information)	1,123	1,053	3,407	2,789
Tax impact	(382)	(374)	(1,051)	(1,072)
Reclassification for losses included in net income, net of tax	741	679	2,356	1,717
Total cash flow hedges adjustments, net of tax	(220)	(1,310)	2,207	(2,070)
Amortization included in net periodic pension cost (see Note 6 for further information):
Amortization for net actuarial loss	4,768	4,358	14,365	13,056
Tax impact	(298)	(338)	(1,303)	(1,129)
Amortization for net actuarial loss, net of tax	4,470	4,020	13,062	11,927
Amortization for prior service credit	(1,257)	(1,274)	(3,781)	(3,820)
Tax impact	50	100	232	300
Amortization for prior service credit, net of tax	(1,207)	(1,174)	(3,549)	(3,520)
Amortization for transition obligation	14	13	42	38
Tax impact	(15)	3	(9)	10
Amortization for transition obligation, net of tax	(1)	16	33	48
Total pension and other postretirement benefits adjustments, net of tax	3,262	2,862	9,546	8,455
Other comprehensive income, net of tax	15,168	16,859	4,165	12,372
Comprehensive income	65,314	79,138	142,326	152,811
Less: Comprehensive income attibutable to noncontrolling interests	11	4,597	3,151	11,020
Comprehensive income attributable to Foster Wheeler AG	$ 65,303	$ 74,541	$ 139,175	$ 141,791

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Guarantees and Warranties

9 Months Ended

Sep. 30, 2013

Guarantees and Warranties [Abstract]

Guarantees and Warranties

7. Guarantees and Warranties

We have agreed to indemnify certain third parties relating to businesses and/or assets that we previously owned and sold to such third parties. Such indemnifications relate primarily to breach of covenants, breach of representations and warranties, as well as potential exposure for retained liabilities, environmental matters and third party claims for activities conducted by us prior to the sale of such businesses and/or assets. It is not possible to predict the maximum potential amount of future payments under these or similar indemnifications due to the conditional nature of the obligations and the unique facts and circumstances involved in each particular indemnification; however many of our indemnification obligations, including for environmental matters, are capped. Historically, our payments under these indemnification obligationshave not had a significant effect on our business, financial condition,results of operations or cash flows. We believe that if we were to incur a loss related to any of these matters, such loss would not have a significant effect on our business, financial condition, results of operations or cash flows.

We maintain liabilities for environmental matters for properties owned and for properties covered under the indemnification obligations described above for businesses and/or assets that we previously owned and sold to third parties. As of September 30, 2013 and December 31, 2012, the carrying amounts of our environmental liabilities were $7,000 and $8,500, respectively.

We also maintain contingencies for warranty expenses on certain of our long-term contracts. Generally, warranty contingencies are accrued over the life of the contract so that a sufficient balance is maintained to cover our aggregate exposure at the conclusion of the project.

	Nine Months Ended September 30,
Warranty Liability:		2013		2012
Balance at beginning of year	$	90,100	$	93,000
Accruals		16,700		22,700
Settlements		(10,400)		(11,400)
Adjustments to provisions*		(16,000)		(16,800)
Foreign currency translation		(100)		1,500
Balance at end of period	$	80,300	$	89,000

_________________

• Adjustments to the provisions represent reversals of warranty provisions that are no longer required.

We are contingently liable under standby letters of credit, bank guarantees and surety bonds, totaling $945,600 and $1,015,900 as of September 30,2013 and December 31, 2012, respectively, primarily for guarantees of our performance on projects currently in execution or under warranty. These amounts include the standby letters of credit issued underour senior unsecured credit agreement discussed in Note 5 and under other facilities worldwide. No material claims have been made against these guarantees, and based on our experience and current expectations, we do not anticipate any material claims.

We have also guaranteed certain performance obligations in a refinery/electric power generation project located in Chile in which we hold a noncontrolling interest. See Note 3 for further information.

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CONSOLIDATED BALANCE SHEET- (Parenthetical) (CHF)	Sep. 30, 2013	Dec. 31, 2012
Consolidated Balance Sheet (Parenthetical) [Abstract]
Registered share par value in CHF	3.00	3.00
Registered shares authorized	157,157,448	171,018,974
Registered shares conditionally authorized	58,874,658	59,369,723
Registered shares issued	104,936,654	108,701,018
Registered shares outstanding	98,344,954	104,441,589
Treasury shares outstanding	6,591,700	4,259,429

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Share-Based Compensation Plans (Reconciliation of temporary equity) (Details) (USD $) In Thousands, unless otherwise specified	9 Months Ended
	Sep. 30, 2013	Sep. 30, 2012
Share - Based Compensation Plans [Abstract]
Balance at beginning of year	$ 8,594	$ 4,993
Compensation cost during the period for those equity awards with intrinsic value on the grant date	11,085	10,092
Intrinsic value of equity awards vested during the period for those equity awards with intrinsic value on the grant date	(7,366)	(5,440)
Balance at end of period	$ 12,313	$ 9,645

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CONSOLIDATED STATEMENT OF OPERATIONS (USD $) In Thousands, except Per Share data, unless otherwise specified	3 Months Ended		9 Months Ended
	Sep. 30, 2013	Sep. 30, 2012	Sep. 30, 2013	Sep. 30, 2012
CONSOLIDATED STATEMENT OF OPERATIONS
Operating revenues	$ 801,826	$ 797,296	$ 2,455,377	$ 2,661,348
Cost of operating revenues	648,360	643,076	2,028,858	2,228,112
Contract profit	153,466	154,220	426,519	433,236
Selling, general and administrative expenses	85,521	77,495	265,654	245,925
Other income, net	(9,873)	(14,342)	(32,638)	(32,995)
Other deductions, net	7,557	8,825	23,359	25,062
Interest income	(1,307)	(2,469)	(4,251)	(8,583)
Interest expense	3,388	3,197	9,976	10,862
Net asbestos-related provision/(gain)	2,000	2,000	(9,750)	7,710
Income from continuing operations before income taxes	66,180	79,514	174,169	185,255
Provision for income taxes	17,794	16,790	36,273	43,965
Income from continuing operations	48,386	62,724	137,896	141,290
Discontinued Operations:
Income/(loss) from discontinued operations before income taxes	1,760	(445)	265	(851)
Provision for income taxes from discontinued operations	0	0	0	0
Income/(loss) from discontinued operations	1,760	(445)	265	(851)
Net income	50,146	62,279	138,161	140,439
Less: Net (loss)/ income attributable to noncontrolling interests	(467)	4,057	3,823	10,712
Net income attributable to Foster Wheeler AG	50,613	58,222	134,338	129,727
Amounts attributable to Foster Wheeler AG:
Income from continuing operations attributable to Foster Wheeler AG	48,853	58,667	134,073	130,578
Income/(loss) from discontinued operations	1,760	(445)	265	(851)
Net income attributable to Foster Wheeler AG	$ 50,613	$ 58,222	$ 134,338	$ 129,727
Basic earnings per share:
Income from continuing operations attributable to Foster Wheeler AG (see Note 1)	$ 0.50	$ 0.55	$ 1.33	$ 1.22
Income/(loss) from discontinued operations attributable to Foster Wheeler AG	$ 0.02	$ (0.01)	$ 0	$ (0.01)
Net income attributable to Foster Wheeler AG	$ 0.52	$ 0.54	$ 1.33	$ 1.21
Diluted earnings per share:
Income from continuing operations attributable to Foster Wheeler AG (see Note 1 )	$ 0.50	$ 0.55	$ 1.32	$ 1.21
Income/(loss) from discontinued operations attributable to Foster Wheeler AG	$ 0.01	$ (0.01)	$ 0	$ (0.01)
Net income attributable to Foster Wheeler AG	$ 0.51	$ 0.54	$ 1.32	$ 1.20

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Pensions and Other Postretirement Benefits (Components of net periodic benefit cost and changes recognized in other comprehensive income) (Details) (USD $) In Thousands, unless otherwise specified	3 Months Ended		9 Months Ended
	Sep. 30, 2013	Sep. 30, 2012	Sep. 30, 2013	Sep. 30, 2012
Pension Plans, Defined Benefit [Member]
Defined Benefit Plan, Net Periodic Benefit Cost/(Credit):
Service cost	$ 277	$ 257	$ 869	$ 794
Interest cost	12,619	13,160	38,158	39,481
Expected return on plan assets	(16,023)	(16,042)	(48,411)	(48,115)
Amortization of net actuarial loss	4,548	4,251	13,705	12,736
Amortization of prior service credit	(383)	(395)	(1,159)	(1,184)
Amortization of transition obligation	14	13	42	38
Net periodic benefit cost/(credit)	1,052	1,244	3,204	3,750
Other Postretirement Benefit Plans, Defined Benefit [Member]
Defined Benefit Plan, Net Periodic Benefit Cost/(Credit):
Service cost	14	17	42	53
Interest cost	606	687	2,017	2,061
Expected return on plan assets	0	0	0	0
Amortization of net actuarial loss	220	107	660	320
Amortization of prior service credit	(874)	(879)	(2,622)	(2,636)
Amortization of transition obligation	0	0	0	0
Net periodic benefit cost/(credit)	$ (34)	$ (68)	$ 97	$ (202)

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Share-Based Compensation Plans (Tables)

9 Months Ended

Sep. 30, 2013

Share - Based Compensation Plans [Abstract]

Share-Based Compensation Expense and Related Tax-Table

	Quarter Ended September 30,				Nine Months Ended September 30,
		2013		2012		2013		2012
Share-based compensation	$	4,638	$	5,668	$	14,119	$	16,362
Related income tax benefit		153		144		599		403

Reconciliation of Temporary Equity-Table

		Nine Months Ended September 30,
		2013		2012
Balance at beginning of year		$	8,594	$	4,993
Compensation cost during the period for those equity awards with
	intrinsic value on the grant date		11,085		10,092
Intrinsic value of equity awards vested during the period for
	those equity awards with intrinsic value on the grant date		(7,366)		(5,440)
Balance at end of period		$	12,313	$	9,645

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Investments (Tables)

9 Months Ended

Sep. 30, 2013

Investments

Equity Method Investments, Summarized Financial Data - Table

	September 30, 2013				December 31, 2012
		Italy		Chile		Italy		Chile
Balance Sheet Data:
Current assets	$	141,817	$	55,220	$	142,584	$	137,626
Other assets (primarily buildings and equipment)		353,173		91,339		358,366		98,550
Current liabilities		97,545		20,254		91,085		60,082
Other liabilities (primarily long-term debt)		198,230		15,953		214,025		23,061
Net assets	$	199,215	$	110,352	$	195,840	$	153,033

	Quarter Ended September 30,								Nine Months Ended September 30,
	2013				2012				2013				2012
		Italy		Chile		Italy		Chile		Italy		Chile		Italy		Chile
Income Statement Data:
Total revenues	$	30,570	$	18,065	$	65,746	$	19,377	$	97,585	$	59,394	$	148,486	$	70,267
Gross profit		6,700		12,539		7,976		12,120		20,702		36,097		18,428		40,797
Income before income taxes		5,125		11,928		5,435		15,770		15,478		34,066		10,905		44,166
Net earnings		3,180		9,303		3,209		12,853		9,919		26,535		6,856		36,220

Equity in the Net Earnings of Unconsolidated Affiliates- Table

	Quarter Ended September 30,				Nine Months Ended September 30,
		2013		2012		2013		2012
Equity in the net earnings of unconsolidated affiliates	$	6,944	$	6,856	$	27,382	$	22,675
Distributions from equity affiliates	$	-	$	-	$	55,933	$	31,917
					September 30, 2013		December 31, 2012
Investments in unconsolidated affiliates					$	161,127	$	187,363

Refinery/Power Generation Project in Chile - Table

		Quarter Ended September 30,				Nine Months Ended September 30,
			2013		2012		2013		2012
Fees for operations and maintenance services
	(included in operating revenues)	$	2,800	$	2,628	$	8,399	$	7,885
						September 30, 2013		December 31, 2012
Receivable from our unconsolidated affiliate
	in Chile (included in trade receivables)					$	4,184	$	16,933

Schedule of Variable Interests - Table

Balance Sheet Data (excluding intercompany balances):	September 30, 2013		December 31, 2012
Current assets	$	5,425	$	15,610
Other assets (primarily buildings and equipment)		36,719		39,194
Current liabilities		2,565		4,825
Other liabilities		4,484		5,452
Net assets	$	35,095	$	44,527

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Goodwill and Other Intangible Assets (Finite-lived intangible assets table) (Details) (USD $) In Thousands, unless otherwise specified	Sep. 30, 2013	Dec. 31, 2012
Total identifiable intangible assets - Gross Carrying Amount	$ 210,216	$ 184,329
Total identifiable intangible assets - Accumulated Amortization	(91,983)	(79,229)
Total identifiable intangible assets - net carrying amount	118,233	105,100
Patents [Member]
Total identifiable intangible assets - Gross Carrying Amount	41,325	41,103
Total identifiable intangible assets - Accumulated Amortization	(33,863)	(32,273)
Total identifiable intangible assets - net carrying amount	7,462	8,830
Trademarks [Member]
Total identifiable intangible assets - Gross Carrying Amount	66,034	64,582
Total identifiable intangible assets - Accumulated Amortization	(33,342)	(31,483)
Total identifiable intangible assets - net carrying amount	32,692	33,099
Customer Relationships Pipeline And Backlog [Member]
Total identifiable intangible assets - Gross Carrying Amount	96,109	72,050
Total identifiable intangible assets - Accumulated Amortization	(23,091)	(14,531)
Total identifiable intangible assets - net carrying amount	73,018	57,519
Patented Technology [Member]
Total identifiable intangible assets - Gross Carrying Amount	6,748	6,594
Total identifiable intangible assets - Accumulated Amortization	(1,687)	(942)
Total identifiable intangible assets - net carrying amount	$ 5,061	$ 5,652

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Derivative Financial Instruments (Income on Derivatives) (Details) (USD $) In Thousands, unless otherwise specified	3 Months Ended		9 Months Ended
	Sep. 30, 2013	Sep. 30, 2012	Sep. 30, 2013	Sep. 30, 2012
Derivative Instruments, Gain (Loss) [Line Items]
Amount of gain/(loss) recognized in income on derivatives	$ 5,737	$ 2,445	$ 298	$ 2,023
Cost of Operating Revenues [Member] | Foreign Exchange Contract [Member] | Not Designated as Hedging Instrument [Member]
Derivative Instruments, Gain (Loss) [Line Items]
Amount of gain/(loss) recognized in income on derivatives	5,616	1,692	1,700	1,192
Other deductions, net [Member] | Foreign Exchange Contract [Member] | Not Designated as Hedging Instrument [Member]
Derivative Instruments, Gain (Loss) [Line Items]
Amount of gain/(loss) recognized in income on derivatives	$ 121	$ 753	$ (1,402)	$ 831

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Litigation and Uncertainties (Asbestos-Related Open Claims Rollforward) (Details) (United States [Member])	3 Months Ended		9 Months Ended
	Sep. 30, 2013 claims	Sep. 30, 2012 claims	Sep. 30, 2013 claims	Sep. 30, 2012 claims
United States [Member]
Open claims at beginning of period	124,810	124,680	125,310	124,540
New claims	950	1,130	3,410	3,470
Claims resolved	(510)	(1,210)	(3,470)	(3,410)
Open claims at end of period	125,250	124,600	125,250	124,600

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Investments (Equity in the Net Earnings of Partially Owned Affiliates - Table) (Details) (Chile and Italy [Member], USD $) In Thousands, unless otherwise specified	3 Months Ended		9 Months Ended
	Sep. 30, 2013	Sep. 30, 2012	Sep. 30, 2013	Sep. 30, 2012	Dec. 31, 2012
Chile and Italy [Member]
Schedule of Equity Method Investments [Line Items]
Equity in the net earnings of unconsolidated affiliates	$ 6,944	$ 6,856	$ 27,382	$ 22,675
Distributions from equity affiliates	0	0	55,933	31,917
Investment in unconsolidated affiliates	$ 161,127		$ 161,127		$ 187,363

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Summary of Significant Accounting Policies (Options not included in diluted earnings calculation) (Details)	3 Months Ended		9 Months Ended
	Sep. 30, 2013	Sep. 30, 2012	Sep. 30, 2013	Sep. 30, 2012
Stock Options [Member]
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]
Options not included in the computation of diluted earnings per share	1,356,167	2,809,894	1,393,499	2,809,894
Performance Based Restricted Stock Units [Member]
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]
Options not included in the computation of diluted earnings per share	1,144,694	0	1,144,694	0

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Summary of Significant Accounting Policies (Narrative) (Details) (USD $) In Thousands, unless otherwise specified	3 Months Ended		9 Months Ended
	Sep. 30, 2013	Sep. 30, 2012	Sep. 30, 2013	Sep. 30, 2012	Dec. 31, 2012
Assumed recovery of commercial claims	$ 4,600		$ 4,600		$ 8,800
Reclassifications from accumulated other comprehensive loss related to cash flow hedges	741	679	2,356	1,717
Global E and C Group [Member]
The period pre-tax impact of out-of-period corrections related to the increase/(decrease) of final estimated profit.				5,300
Global Power Group [Member]
Favorable subcontract settlement recognized in the changes in final estimated contract profit revisions				$ 6,900

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Pensions and Other Postretirement Benefits

9 Months Ended

Sep. 30, 2013

Pensions and Other Postretirement Benefits [Abstract]

Pensions and Other Postretirement Benefits

6. Pensions and Other Postretirement Benefits

We have defined benefit pension plans in the United States, or U.S., the United Kingdom, or U.K., Canada, Finland, France, India and South Africa, and we have other postretirement benefit plansfor health care and life insurance benefits in the U.S. and Canada.

Defined Benefit Pension Plans — Our defined benefit pension plans, or pension plans, cover certain full-time employees. Under the pension plans, retirement benefits are primarily a function of both years of service and level of compensation. The U.S. pension plans, which are closed to new entrants and additional benefit accruals, and the Canada, Finland, France and India pension plans are non-contributory. The U.K. pension plan, which is closed to new entrants and additional benefit accruals, and the South Africa pension plan are both contributory plans.

Based on the minimum statutory funding requirements for 2013, we are not required to make any mandatory contributions to our U.S. pension plans. The following table provides details on 2013 mandatory contribution activity for our non-U.S. pension plans:

Contributions in the nine months ended September 30, 2013	$	14,900
Remaining contributions expected for the year 2013		5,700
Contributions expected for the year 2013	$	20,600

We did not make any discretionary contributions during the first nine months of 2013; however, we may elect to make discretionary contributions to our U.S. and/or non-U.S. pension plans during the remainder of 2013.

Other Postretirement Benefit Plans — Certain employees in the U.S. and Canada may become eligible for other postretirement benefit plans such as health care and life insurance benefits if they qualify for and commence normal or early retirement pension benefits as defined in the U.S. and Canada pension plans while working for us. Additionally, one of our subsidiaries in the U.S. also has a benefit plan, which provides coverage for an employee's beneficiary upon the death of the employee. This plan has been closed to new entrants since 1988.

Components of net periodic benefit cost/(credit)include:

		Defined Benefit Pension Plans								Other Postretirement Benefit Plans
	Quarter Ended				Nine Months Ended				Quarter Ended				Nine Months Ended
	September 30,				September 30,				September 30,				September 30,
		2013		2012		2013		2012		2013		2012		2013		2012
Net periodic benefit cost/(credit):
Service cost	$	277	$	257	$	869	$	794	$	14	$	17	$	42	$	53
Interest cost		12,619		13,160		38,158		39,481		606		687		2,017		2,061
Expected return on plan assets		(16,023)		(16,042)		(48,411)		(48,115)		-		-		-		-
Amortization of net actuarial loss		4,548		4,251		13,705		12,736		220		107		660		320
Amortization of prior service credit		(383)		(395)		(1,159)		(1,184)		(874)		(879)		(2,622)		(2,636)
Amortization of transition obligation		14		13		42		38		-		-		-		-
Net periodic benefit cost/(credit)	$	1,052	$	1,244	$	3,204	$	3,750	$	(34)	$	(68)	$	97	$	(202)

The components of net periodic benefit cost are recognized within cost of operating revenues and selling, general and administrative expenses on our consolidated statement of operations. Please refer to Note 1 for further discussion on the timing of when items in cost of operating revenues are recognized on our consolidated statement of operations under our accounting policy for revenue recognition on long-term contracts, which utilizes the percentage-of-completion method.The offsetting effect of the amortization components of net periodic benefit cost listed aboveare included in other comprehensive income on our consolidated statement of comprehensive income along with their corresponding taxeffects.

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Business Segments (Reconciliation of EBITDA to Net Income Attributable to Foster Wheeler - Table) (Details) (USD $) In Thousands, unless otherwise specified	3 Months Ended				9 Months Ended
	Sep. 30, 2013		Sep. 30, 2012		Sep. 30, 2013		Sep. 30, 2012
Total EBITDA	$ 85,827		$ 91,584		$ 227,334		$ 223,725
EBITDA from continuing operations	84,067		90,832		223,150		220,946
EBITDA from discontinued operations	1,760		752		4,184		2,779
Less: EBITDA from discontinued operations	1,760		752		4,184		2,779
EBITDA from continuing operations	84,067		90,832		223,150		220,946
Add: Net income attributable to noncontrolling interests	(467)		4,057		3,823		10,712
Less: Interest expense	3,388		3,197		9,976		10,862
Less: Depreciation and amortization	14,032		12,178		42,828		35,541
Income from continuing operations before income taxes	66,180		79,514		174,169		185,255
Less: Provision for income taxes	17,794		16,790		36,273		43,965
Income from continuing operations	48,386		62,724		137,896		141,290
Income/(loss) from discontinued operations	1,760		(445)		265		(851)
Net income	50,146		62,279		138,161		140,439
Less: Net income attributable to noncontrolling interests	(467)		4,057		3,823		10,712
Net income attributable to Foster Wheeler AG	50,613		58,222		134,338		129,727
Net increase in contract profit from the regular revaluation of final estimated contract profit revisions	30,200		22,700		74,800		58,000
Net asbestos-related provision/(gain)	2,000		2,000		(9,750)		7,710
Charges for severance-related postemployment benefits	4,000		0		8,400		0
Global E and C Group [Member]
EBITDA from continuing operations	59,940		51,964		157,261		138,809
EBITDA from continuing operations	59,940		51,964		157,261		138,809
Net increase in contract profit from the regular revaluation of final estimated contract profit revisions	13,800	[1]	7,000	[1],[2]	38,200	[1]	12,100	[1],[2]
Net asbestos-related provision/(gain)	0	[3]	0	[3]	0	[3]	1,700	[3]
Charges for severance-related postemployment benefits	1,000		0		3,900		0
The period pre-tax impact of out-of-period corrections related to the increase/(decrease) of final estimated profit.							5,300
Global Power Group [Member]
EBITDA from continuing operations	45,428		64,396		115,699		158,535
EBITDA from continuing operations	45,428		64,396		115,699		158,535
Net increase in contract profit from the regular revaluation of final estimated contract profit revisions	16,400	[1]	15,700	[1]	36,600	[1]	45,900	[1],[4]
Charges for severance-related postemployment benefits	3,000		0		4,100		0
Favorable subcontract settlement recognized in the changes in final estimated contract profit revisions							6,900
C and F Group [Member]
EBITDA from continuing operations	(21,301)	[5]	(25,528)	[5]	(49,810)	[5]	(76,398)	[5]
EBITDA from continuing operations	(21,301)	[5]	(25,528)	[5]	(49,810)	[5]	(76,398)	[5]
Net asbestos-related provision/(gain)	2,000	[3]	2,000	[3]	(9,800)	[3]	6,000	[3]
Charges for severance-related postemployment benefits	$ 0		$ 0		$ 400		$ 0

[1] Please refer to “Revenue Recognition on Long-Term Contracts” in Note 1 for further information regarding changes in our final estimated contract profit.

[2] The changes in final estimated contract profit revisions for our Global E&C Group and our financial results did not include an increase in final estimated contract profit of approximately $5,300 during the quarter and nine months ended September 30, 2012. The correction was recorded in the quarter ended December 31, 2012 as it was not material to the financial results for the quarter and nine months ended September 30, 2012 (the periods in which it should have been recorded), nor was it material to the financial results for the year ended December 31, 2012.

[3] Please refer to Note 12 for further information regarding the revaluation of our asbestos liability and related asset.

[4]         The changes in final estimated contract profit revisions for our Global Power Group were increased during the nine months ended September 30, 2012 for a favorable settlement with a subcontractor of approximately $6,900.

[5] Includes general corporate income and expense, our captive insurance operation and the elimination of transactions and balances related to intercompany interest.

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Business Segments (Tables)

9 Months Ended

Sep. 30, 2013

Business Segments [Abstract]

Operating Revenues by Industry, Operating Segment and Geographic Regions - Table

	Quarter Ended September 30,				Nine Months Ended September 30,
		2013		2012		2013		2012
Operating Revenues (Third-Party) by Industry:
Power generation	$	194,258	$	214,742	$	563,713	$	729,178
Oil refining		323,019		337,067		1,006,651		1,022,978
Pharmaceutical		29,308		13,606		107,706		40,199
Oil and gas		83,145		109,466		254,626		524,580
Chemical/petrochemical		124,284		80,209		360,831		225,956
Power plant design, operation and maintenance		41,773		28,248		125,282		80,371
Environmental		1,426		1,790		4,271		6,434
Other, net of eliminations		4,613		12,168		32,297		31,652
Total	$	801,826	$	797,296	$	2,455,377	$	2,661,348
Operating Revenues (Third-Party) by Business Segment:
Global E&C Group	$	615,028	$	578,072	$	1,865,721	$	1,915,087
Global Power Group		186,798		219,224		589,656		746,261
Total	$	801,826	$	797,296	$	2,455,377	$	2,661,348
Operating Revenues (Third-Party) by Geographic Region:
Africa	$	12,694	$	22,475	$	52,341	$	70,136
Asia Pacific		208,073		231,267		612,348		947,867
Europe		192,318		189,003		596,154		647,935
Middle East		91,482		65,166		236,284		178,015
North America		205,570		211,711		729,583		572,826
South America		91,689		77,674		228,667		244,569
Total	$	801,826	$	797,296	$	2,455,377	$	2,661,348

Segment Reporting Information - Table

			Quarter Ended September 30,				Nine Months Ended September 30,
				2013		2012		2013		2012
EBITDA:
	Global E&C Group		$	59,940	$	51,964	$	157,261	$	138,809
	Global Power Group			45,428		64,396		115,699		158,535
	C&F Group *			(21,301)		(25,528)		(49,810)		(76,398)
	Discontinued operations			1,760		752		4,184		2,779
		Total EBITDA		85,827		91,584		227,334		223,725
	Less: Discontinued operations			1,760		752		4,184		2,779
		EBITDA from continuing operations		84,067		90,832		223,150		220,946
Add: Net (loss)/income attributable to noncontrolling interests				(467)		4,057		3,823		10,712
Less: Interest expense				3,388		3,197		9,976		10,862
Less: Depreciation and amortization				14,032		12,178		42,828		35,541
Income from continuing operations before income taxes				66,180		79,514		174,169		185,255
Less: Provision for income taxes				17,794		16,790		36,273		43,965
Income from continuing operations				48,386		62,724		137,896		141,290
Income/(loss) from discontinued operations				1,760		(445)		265		(851)
Net income				50,146		62,279		138,161		140,439
Less: Net (loss)/income attributable to noncontrolling interests				(467)		4,057		3,823		10,712
Net income attributable to Foster Wheeler AG			$	50,613	$	58,222	$	134,338	$	129,727
______________
* Includes general corporate income and expense, our captive insurance operation and the elimination of transactions and balances related to intercompany interest.
EBITDA in the above table includes the following:			Quarter Ended September 30,				Nine Months Ended September 30,
				2013		2012		2013		2012
Net increase in contract profit from the regular
	revaluation of final estimated contract profit revisions:(1)
	Global E&C Group(2)		$	13,800	$	7,000	$	38,200	$	12,100
	Global Power Group(3)			16,400		15,700		36,600		45,900
		Total	$	30,200	$	22,700	$	74,800	$	58,000
Net asbestos-related provision/(gain):(4)
	Global E&C Group			-		-		-		1,700
	C&F Group			2,000		2,000		(9,800)		6,000
		Total	$	2,000	$	2,000	$	(9,800)	$	7,700
Charges for severance-related postemployment benefits:
	Global E&C Group		$	1,000	$	-	$	3,900	$	-
	Global Power Group			3,000		-		4,100		-
	C&F Group			-		-		400		-
		Total	$	4,000	$	-	$	8,400	$	-

______________

(1)Please refer to “Revenue Recognition on Long-Term Contracts” in Note 1 for further information regarding changes in our final estimated contract profit.

(2)The changes in final estimated contract profit revisions for our Global E&C Group and our financial results did not include an increase in final estimated contract profit of approximately $5,300 during the quarter and nine months ended September 30, 2012. The correction was recorded in the quarter ended December 31, 2012 as it was not material to the financial results for the quarter and nine months ended September 30, 2012 (the periods in which it should have been recorded), nor was it material to the financial results for the year ended December 31, 2012.

(3)The changes in final estimated contract profit revisions for our Global Power Group were increased during the nine months ended September 30, 2012 for a favorable settlement with a subcontractor of approximately $6,900.

(4)Please refer to Note 12 for further information regarding the revaluation of our asbestos liability and related asset.

Schedule of Income/(Loss) Associated with our Discontinued Operations-Table

	Quarter Ended September 30,				Nine Months Ended September 30,
		2013		2012		2013		2012
EBITDA from discontinued operations	$	1,760	$	752	$	4,184	$	2,779
Less: Interest expense		-		-		-		-
Less: Depreciation and amortization*		-		1,197		3,919		3,630
Income/(loss) from discontinued operations before income taxes*		1,760		(445)		265		(851)
Less: Provision for income taxes		-		-		-		-
Income/(loss) from discontinued operations*	$	1,760	$	(445)	$	265	$	(851)

__________________

* During the nine months ended September 30, 2013, we recorded an impairment charge of $3,919 at our Camden, New Jersey waste-to-energy facility which was recorded as depreciation expense withinincome/(loss)from discontinued operations. Please refer to Note 13 for further information.

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Investments (Narrative) (Details) In Thousands, unless otherwise specified					3 Months Ended		9 Months Ended		3 Months Ended		9 Months Ended			9 Months Ended
	Sep. 30, 2013 Project Which Generates Earnings From Royalty Payments Linked to the Price of Natural Gas in Italy [Member]	Sep. 30, 2013 Waste-to-Energy Project in Italy [Member]	Sep. 30, 2013 Wind Farm Project in Italy [Member]	Sep. 30, 2013 Refinery / Power Generation Project in Chile [Member]	Sep. 30, 2013 Chile [Member] USD ($)	Sep. 30, 2012 Chile [Member] USD ($)	Sep. 30, 2013 Chile [Member] USD ($)	Sep. 30, 2012 Chile [Member] USD ($)	Sep. 30, 2013 Italy [Member] USD ($)	Sep. 30, 2012 Italy [Member] USD ($)	Sep. 30, 2013 Italy [Member] USD ($)	Sep. 30, 2012 Italy [Member] USD ($)	Sep. 30, 2013 Two Electric Power Generation Projects in Italy [Member]	Sep. 30, 2013 Engineering, Procurement and Processing Facilities in China [Member] USD ($)	Sep. 30, 2013 Engineering, Procurement and Processing Facilities in China [Member] CNY
Equity in the net earnings/(loss) of unconsolidated affiliates					$ 5,413	$ 5,283	$ 22,467	$ 18,674	$ 1,531	$ 1,573	$ 4,915	$ 4,001
Investment in unconsolidated affiliates	50.00%	39.00%	50.00%	85.00%									41.65%	49.00%	49.00%
Debt service letter of credit					10,000		10,000
Guarantee for obligation under Chile based project operation and maintenance agreement					20,000		20,000
Equity Earnings Increase Resulted From Prior Year Revised Earnings Allocation					3,200		3,200
Equity Earnings Increase From Reversal Of Insurance Related Contingency					3,000		3,000
Payment to acquire equity method investments														$ 11,600	72,000

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Share-Based Compensation Plans

9 Months Ended

Sep. 30, 2013

Share - Based Compensation Plans [Abstract]

Share-Based Compensation Plans

9. Share-Based Compensation Plans

Our share-based compensation plans include both stock options and restricted awards. The following table summarizes our share-based compensation expense and related income tax benefit:

	Quarter Ended September 30,				Nine Months Ended September 30,
		2013		2012		2013		2012
Share-based compensation	$	4,638	$	5,668	$	14,119	$	16,362
Related income tax benefit		153		144		599		403

As of September 30, 2013, we had total unrecognized compensation cost related to restricted share units, or RSUs, performance-based restricted share units, or performance RSUs, and stock options of $15,545,$8,170and $3,725,respectively. Those amounts are expected to be recognized as expense over a weighted-average period of approximately two years.

We estimate the fair value of RSU awards using the market price of our shares on the date of grant. We then recognize the fair value of each RSU award as compensation expense ratably using the straight-line attribution method over the service period (generally the vesting period).

Under our performance RSU awards, the number of restricted share units that ultimately vest depend on our share price performance against specified performance goals, which are defined in our performance RSU award agreements. We estimate the grant date fair value of each performance RSU award using a Monte Carlo valuation model. We then recognize the fair value of each performance RSU award as compensation expense ratably using the straight-line attribution method over the service period (generally the vesting period).

We estimate the fair value of each option award on the date of grant using the Black-Scholes option valuation model. We then recognize the grant date fair value of each option as compensation expense ratably using the straight-line attribution method over the service period (generally the vesting period). The Black-Scholes model incorporates the following assumptions:

• Expected volatility – we estimate the volatility of our share price at the date of grant using a “look-back” period which coincides with the expected term, defined below. We believe using a “look-back” period which coincides with the expected term is the most appropriate measure for determining expected volatility.

• Expected term – we estimate the expected term using the “simplified” method, as outlined in Staff Accounting Bulletin No. 107, “Share-Based Payment.”
• Risk-free interest rate – we estimate the risk-free interest rate using the U.S. Treasury yield curve for periods equal to the expected term of the options in effect at the time of grant.
• Dividends – we use an expected dividend yield of zero because we have not declared or paid a cash dividend since July 2001 and we do not have any plans to declare or pay any cash dividends.

Our share-based compensation plans include a “change in control” provision, which provides for possible cash redemption of equity awards issued thereunder in certain limited circumstances. In accordance with Securities and Exchange Commission Accounting Series Release No. 268, “Presentation in Financial Statements of Redeemable Preferred Stocks,” we present the redemption amount of these equity awards as temporary equity on the consolidated balance sheet as the equity award is amortized during the vesting period. The redemption amount represents the intrinsic value of the equity award on the grant date. In accordance with current accounting guidance regarding the classification and measurement of redeemable securities, we do not adjust the redemption amount each reporting period unless and until it becomes probable that the equity awards will become redeemable (upon a change in control event). Upon vesting of the equity awards, we reclassify the intrinsic value of the equity awards, as determined on the grant date, to permanent equity.

Reconciliations of temporary equity for the nine months endedSeptember 30, 2013 and 2012 were as follows:

		Nine Months Ended September 30,
		2013		2012
Balance at beginning of year		$	8,594	$	4,993
Compensation cost during the period for those equity awards with
	intrinsic value on the grant date		11,085		10,092
Intrinsic value of equity awards vested during the period for
	those equity awards with intrinsic value on the grant date		(7,366)		(5,440)
Balance at end of period		$	12,313	$	9,645

Our articles of association provide for conditional capital for the issuance of shares under our share-based compensation plans and other convertible or exercisable securities we may issue in the future. Conditional capital decreases upon issuance of shares in connection with the exercise of outstanding stock options or vesting of restricted awards, with an offsetting increase to our issued and authorized share capital. As of September 30, 2013, our remaining available conditional capital was 58,874,658 shares.

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Borrowings

9 Months Ended

Sep. 30, 2013

Borrowings [Abstract]

Borrowings

5. Borrowings

The following table shows the components of our long-term debt:

			September 30, 2013						December 31, 2012
			Current		Long-term		Total		Current		Long-term		Total
Capital Lease Obligations			$	2,782	$	51,946	$	54,728	$	2,545	$	53,780	$	56,325
Special-Purpose Limited Recourse Project Debt:
	FW Power S.r.l.			8,961		58,529		67,490		9,215		61,575		70,790
	Energia Holdings, LLC at 11.443% interest,
		due April 15, 2015		2,040		5,355		7,395		1,912		7,396		9,308
Subordinated Robbins Facility Exit Funding Obligations:
	1999C Bonds at 7.25% interest, due October 15, 2024			-		1,283		1,283		-		1,283		1,283
Total			$	13,783	$	117,113	$	130,896	$	13,672	$	124,034	$	137,706
Estimated fair value							$	145,800					$	155,718

Senior Credit Agreement — On August 3, 2012, we entered into a new five-year senior unsecured credit agreement, which replaced our amended and restated senior unsecured credit agreement from July 2010. Our new senior credit agreementprovides for an unsecured revolving line of credit of $750,000 and contains an increase option permitting us, subject to certain requirements, to arrange with existing lenders and/or new lenders to provide up to an aggregate of $300,000 in additional commitments. During the term of this senior credit agreement, we may request, subject to certain requirements, up to two one-year extensions of the contractual termination date.

We can issue up to $750,000 under the letter of credit portion of the facility. Letters of credit issued under our new senior credit agreement have performance pricing that is decreased (or increased) as a result of improvements (or reductions) in our corporate credit ratings, as defined in the senior credit agreement. Based on our current credit ratings, letter of credit fees for performance and non-performance letters of credit issued under our new senior credit agreement are 0.75% and 1.50% per annum of the outstanding amount, respectively, excluding a nominal fronting fee. We also have the option to use up to $250,000 of the $750,000 for revolving borrowings at a rate equal to adjusted LIBOR, as defined in the senior credit agreement, plus 1.50%, subject also to the performance pricing noted above.

Fees and expenses incurred in conjunction with the execution of our new senior credit agreement were approximately $4,000 and, along with a portion of the remaining unamortized fees from our July 2010 agreement, are being amortized to expense over the five-year term of the agreement, which commenced in the third quarter of 2012.

Ournew senior credit agreement contains various customary restrictive covenants. In addition, ournew senior credit agreement contains financial covenants relating to leverage and interest coverage ratios. Our total leverage ratio compares total indebtedness to EBITDA, as defined in the credit agreement, and our total interest coverage ratio compares EBITDA, as defined in the credit agreement, to interest expense. Both the leverage and interest coverage ratios are measured quarterly. In addition, the leverage ratio is measured as of any date of determination for certain significant events. All such terms are defined in ournew senior credit agreement. We have been in compliance with all financial covenants and other provisions of both our August 2012 and our July 2010 senior credit agreements, while the respective agreements were in effect during the nine months endedSeptember 30, 2013 and 2012.

We had approximately $250,900 and $250,600 of letters of credit outstanding under our senior credit agreement as of September 30, 2013 and December 31, 2012, respectively. The letter of credit fees under our senior credit agreement as of September 30, 2013 and December 31, 2012ranged from 0.75% to 1.50% of the outstanding amount, excluding fronting fees. There were no funded borrowings outstanding under our senior credit agreementas of September 30, 2013 and December 31, 2012.

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CONSOLIDATED STATEMENT OF CASH FLOWS (USD $) In Thousands, unless otherwise specified	9 Months Ended
	Sep. 30, 2013	Sep. 30, 2012
CASH FLOWS FROM OPERATING ACTIVITIES
Net income	$ 138,161	$ 140,439
Adjustments to reconcile net income to cash flows from operating activities:
Depreciation and amortization	42,828	35,541
Net non-cash asbestos-related provision	6,000	7,710
Share-based compensation expense	14,119	16,362
Shortfall in tax benefit related to share-based compensation	123	61
Deferred income tax provision	62	413
Dividends, net of equity in earnings of unconsolidated affiliates	28,744	3,859
Other noncash items, net	86	868
Changes in assets and liabilities, net of effects from aquisitions:
Decrease/(Increase) in receivables	4,833	(103,491)
Net change in contracts in process and billings in excess of costs and estimated earnings on uncompleted contracts	(17,463)	(65,713)
(Decrease)/increase in accounts payable and accrued expenses	(45,316)	73,582
Net change in other current assets and liabilities	(31,296)	9,764
Net change in other long-term assets and liabilities	(26,799)	(9,721)
Net cash provided by operating activities-continuing operations	114,082	109,674
Net cash (used in)/provided by operating activities-discontinued operations	(385)	931
Net cash provided by operating activities	113,697	110,605
CASH FLOWS FROM INVESTING ACTIVITIES
Payments related to acquisition of businesses, net of cash acquired	(52,770)	0
Proceeds from disposition of business	48,600	0
Change in restricted cash	9,249	(34,264)
Capital expenditures	(21,810)	(26,397)
Return of investment from unconsolidated affiliates	87	6,207
Investments in and advances to unconsolidated affiliates	(11,591)	(1,987)
Proceeds from sale of short-term investments	0	1,255
Other investing activities	(47)	299
Net cash used in investing activities- continuing operations	(28,282)	(54,887)
Net cash provided by/( used in) investing activities- discontinued operations	385	(931)
Net cash used in investing activities	(27,897)	(55,818)
CASH FLOWS FROM FINANCING ACTIVITIES
Repurchase of shares	(150,131)	(50,921)
Distributions to noncontrolling interests	(12,579)	(12,505)
Proceeds from stock options exercised	4,293	735
Shortfall in tax benefit related to share-based compensation	(123)	(61)
Payment of deferred financing costs	0	(3,993)
Repayment of debt and capital lease obligations	(8,627)	(7,065)
Net cash used in financing activities	(167,167)	(73,810)
Effect of exchange rate changes on cash and cash equivalents	(3,826)	10,344
(DECREASE)/INCREASE IN CASH AND CASH EQUIVALENTS	(85,193)	(8,679)
Less: Increase/(decrease) in cash and cash equivalents-discontinued operations	0	0
(Decrease)/increase in cash and equivalents-continuing operations	(85,193)	(8,679)
Cash and cash equivalents at beginning of year	582,322	718,049
CASH AND CASH EQUIVALENTS AT END OF PERIOD	$ 497,129	$ 709,370

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Guarantees and Warranties (Details) (USD $) In Thousands, unless otherwise specified	9 Months Ended
	Sep. 30, 2013		Sep. 30, 2012		Dec. 31, 2012
Warranty Liability
Balance at beginning of year	$ 90,100		$ 93,000
Accruals	16,700		22,700
Settlements	(10,400)		(11,400)
Adjustments to provisions	(16,000)	[1]	(16,800)	[1]
Foreign currency translation	(100)		1,500
Balance at end of period	80,300		89,000
Amount we are contingently liable for under standby letters of credit, bank guarantees and surety bonds	945,600				1,015,900
Environmental liabilities	$ 7,000				$ 8,500

[1]  Adjustments to the provisions represent reversals of warranty provisions that are no longer required.

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Borrowings (Components of long-term debt) (Details) (USD $) In Thousands, unless otherwise specified	Sep. 30, 2013	Dec. 31, 2012
Current	$ 13,783	$ 13,672
Long-term	117,113	124,034
Total	130,896	137,706
Estimated fair value of long-term debt	145,800	155,718
Capital Lease Obligations [Member]
Current	2,782	2,545
Long-term	51,946	53,780
Total	54,728	56,325
Secured Debt-FW Power Srl [Member]
Current	8,961	9,215
Long-term	58,529	61,575
Total	67,490	70,790
Secured Debt - Energia Holdings [Member]
Current	2,040	1,912
Long-term	5,355	7,396
Total	7,395	9,308
1999C Bonds [Member]
Current	0	0
Long-term	1,283	1,283
Total	$ 1,283	$ 1,283

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Summary of Significant Accounting Policies (Projects with final estimated contract profit revisions whose impact exceeded $1 million) (Details) (USD $) In Thousands, unless otherwise specified	3 Months Ended		9 Months Ended
	Sep. 30, 2013 Projects	Sep. 30, 2012 Projects	Sep. 30, 2013 Projects	Sep. 30, 2012 Projects
Summary of Significant Accounting Policies [Abstract]
Number of contracts that had final estimated contract profit revisions whose impact on contract profit exceeded $1 million	10	12	28	27
Net increase in contract profit from the regular revaluation of final estimated contract profit revisions	$ 30,200	$ 22,700	$ 74,800	$ 58,000

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Litigation and Uncertainties (US Asbestos related assets and liabilities - Table) (Details) (USD $) In Thousands, unless otherwise specified	Sep. 30, 2013	Dec. 31, 2012
Asbestos-related assets:
Asbestos related insurance recovery receivable	$ 114,188	$ 132,438
Asbestos-related liabilities:
Asbestos-related liability	237,632	259,350
United States [Member]
Asbestos-related assets:
Accounts and notes receivable-other	22,184	33,626
Asbestos related insurance recovery receivable	86,195	102,751
Total asbestos-related assets	108,379	136,377
Asbestos-related liabilities:
Accrued expenses	35,127	47,900
Asbestos-related liability	207,380	227,400
Total asbestos-related liabilities	242,507	275,300
Liability balance by claim category:
Open claims	37,856	42,700
Future unasserted claims	204,651	232,600
Total asbestos-related liabilities	$ 242,507	$ 275,300

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Share-Based Compensation Plans (Narrative) (Details) (USD $) In Thousands, except Share data, unless otherwise specified	9 Months Ended
	Sep. 30, 2013
Number of years of weighted-average period expected to be recognized as expense	2 years 0 months 0 days
Remaining available conditional capital shares	58,874,658
Stock Options [Member]
Unrecognized compensation cost	$ 3,725
Restricted Stock Units (RSUs) [Member]
Unrecognized compensation cost	15,545
Performance Restricted Stock Units [Member]
Unrecognized compensation cost	$ 8,170

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Litigation and Uncertainties

9 Months Ended

Sep. 30, 2013

Litigation and Uncertainties

Litigation and Uncertainties

12. Litigation and Uncertainties

Asbestos

Some of our U.S. and U.K. subsidiaries are defendants in numerous asbestos-related lawsuits and out-of-court informal claims pending in the U.S. and the U.K. Plaintiffs claim damages for personal injury alleged to have arisen from exposure to or use of asbestos in connection with work allegedly performed by our subsidiaries during the 1970s and earlier.

United States

A summary of our U.S. claim activity is as follows:

	Quarter Ended September 30,		Nine Months Ended September 30,
Number of Claims by period:	2013	2012	2013	2012
Open claims at beginning of period	124,810	124,680	125,310	124,540
New claims	950	1,130	3,410	3,470
Claims resolved	(510)	(1,210)	(3,470)	(3,410)
Open claims at end of period	125,250	124,600	125,250	124,600

We had the following U.S. asbestos-related assets and liabilities recorded on our consolidated balance sheet as of the dates set forth below. Total U.S. asbestos-related liabilities are estimated through the third quarter of 2028. Although it is likely that claims will continue to be filed after that date, the uncertainties inherent in any long-term forecast prevent us from making reliable estimates of the indemnity and defense costs that might be incurred after that date.

U.S. Asbestos	September 30, 2013		December 31, 2012
Asbestos-related assets recorded within:
Accounts and notes receivable-other	$	22,184	$	33,626
Asbestos-related insurance recovery receivable		86,195		102,751
Total asbestos-related assets	$	108,379	$	136,377
Asbestos-related liabilities recorded within:
Accrued expenses	$	35,127	$	47,900
Asbestos-related liability		207,380		227,400
Total asbestos-related liabilities	$	242,507	$	275,300
Liability balance by claim category:
Open claims	$	37,856	$	42,700
Future unasserted claims		204,651		232,600
Total asbestos-related liabilities	$	242,507	$	275,300

We have worked with Analysis, Research & Planning Corporation, or ARPC, nationally recognized consultants in the U.S. with respect to projecting asbestos liabilities, to estimate the amount of asbestos-related indemnity and defense costs at each year-end based on a forecast for the next 15 years. Each year we have recorded our estimated asbestos liability at a level consistent with ARPC's reasonable best estimate. Our estimated asbestos liability decreased during the first nine months of 2013 as a result of indemnity and defense cost payments totaling approximately $38,800, partially offset by the impact of a $6,000 increase in the liability related to our rolling 15-year asbestos-related liability estimate. The total asbestos-related liabilities are comprised of our estimates for our liability relating to open (outstanding) claims being valued and our liability for future unasserted claims through the third quarter of 2028.

Our liability estimate is based upon the following information and/or assumptions: number of open claims, forecasted number of future claims, estimated average cost per claim by disease type – mesothelioma, lung cancer and non-malignancies – and the breakdown of known and future claims into disease type – mesothelioma, lung cancer and non-malignancies, as well as other factors. The total estimated liability, which has not been discounted for the time value of money, includes both the estimate of forecasted indemnity amounts and forecasted defense costs. Total defense costs and indemnity liability payments are estimated to be incurred through the third quarter of 2028, during which period the incidence of new claims is forecasted to decrease each year. We believe that it is likely that there will be new claims filed after the third quarter of 2028, but in light of uncertainties inherent in long-term forecasts, we do not believe that we can reasonably estimate the indemnity and defense costs that might be incurred after the third quarter of 2028.

Through September 30, 2013, total cumulative indemnity costs paid, prior to insurance recoveries, were approximately $818,600 and total cumulative defense costs paid were approximately $404,500, or approximately 33% of total defense and indemnity costs. The overall historic average combined indemnity and defense cost per resolved claim through September 30, 2013 has been approximately $3.3. The average cost per resolved claim is increasing and we believe it will continue to increase in the future.

Over the last several years, certain of our subsidiaries have entered into settlement agreements calling for insurers to make lump-sum payments, as well as payments over time, for use by our subsidiaries to fund asbestos-related indemnity and defense costs and, in certain cases, for reimbursement for portions of out-of-pocket costs previously incurred. As our subsidiaries reach agreements withtheir insurers to settle their disputed asbestos-related insurance coverage, we increase our asbestos-related insurance asset and record settlement gains.

Asbestos-related assets under executed settlement agreements with insurers due in the next 12 months are recorded within accounts and notes receivable-other and amounts due beyond 12 months are recorded within asbestos-related insurance recovery receivable. Asbestos-related insurance recovery receivable also includes our best estimate of actual and probable insurance recoveries relating to our liability for pending and estimated future asbestos claims through the third quarterof 2028. Our asbestos-related assets have not been discounted for the time value of money.

Our insurance recoveries may be limited by future insolvencies among our insurers. Other than receivables related to bankruptcy court-approved settlements during liquidation proceedings, we have not assumed recovery in the estimate of our asbestos-related insurance asset from any of our currently insolvent insurers. We have considered the financial viability and legal obligations of our subsidiaries' insurance carriers and believe that the insurers or their guarantors will continue to reimburse a significant portion of claims and defense costs relating to asbestos litigation. As of September 30, 2013 and December 31, 2012, we have not recorded an allowance for uncollectible balances against our asbestos-related insurance assets. We write off receivables from insurers that have become insolvent; there were no such write-offs during the nine months endedSeptember 30, 2013 and 2012. Insurers may become insolvent in the future and our insurers may fail to reimburse amounts owed to us on a timely basis. If we fail to realize the expected insurance recoveries, or experience delays in receiving material amounts from our insurers, our business, financial condition, results of operations and cash flows could be materially adversely affected. During the nine months ended September 30, 2013, we recognized a gain as the result of the collection of a $15,750 insurance receivable related to an insolvent insurance carrier, which we had previously written-off. The proceeds were received as a result of a bankruptcy court-approved settlement during liquidation proceedings related to the insolvent insurance carrier.

The following table summarizes our U.S. net asbestos-related (gain)/provision:

	Quarter Ended September 30,				Nine Months Ended September 30,
		2013		2012		2013		2012
Provision for revaluation	$	2,000	$	2,000	$	6,000	$	5,997
Gain on the settlement of coverage litigation		-		-		(15,750)		-
Net asbestos-related (gain)/provision	$	2,000	$	2,000	$	(9,750)	$	5,997

Our net asbestos-related gain in the nine months ended September 30, 2013was the net result of the favorable impact of the inclusion of a gainrecognized during the nine months ended September 30, 2013upon collection of a $15,750 insurance receivable related to an insolvent insurance carrier, which had been previously written-off, as discussed above, partially offset by the unfavorable impact related to the provision for our rolling 15-year asbestos liability estimate, net of anticipated insurance recoveries in each respective period.

The following table summarizes our approximate U.S. asbestos-related net cash impact forindemnity and defense cost payments and collection of insurance proceeds:

	Quarter Ended September 30,				Nine Months Ended September 30,
		2013		2012		2013		2012
Asbestos litigation, defense and case resolution payments	$	12,400	$	12,100	$	38,800	$	40,700
Insurance proceeds		(15,500)		(15,800)		(43,800)		(37,500)
Net asbestos-related (proceeds)/payments	$	(3,100)	$	(3,700)	$	(5,000)	$	3,200

We expect to have net cash outflows of $1,100during the full year 2013as a result of asbestos liability indemnity and defense payments in excess of insurance proceeds, which includes the impact of the cash proceeds received from the collection of an insurance receivable balance from an insolvent insurance carrier discussed above. This estimate assumes no settlements with insurance companies and no elections by us to fund additional payments. As we continue to collect cash from insurance settlements and assuming no increase in our asbestos-related insurance liability, the asbestos-related insurance receivable recorded on our consolidated balance sheet will continue to decrease.

The estimate of the liabilities and assets related to asbestos claims and recoveries is subject to a number of uncertainties that may result in significant changes in the current estimates. Among these are uncertainties as to the ultimate number and type of claims filed, the amounts of claim costs, the impact of bankruptcies of other companies with asbestos claims, uncertainties surrounding the litigation process from jurisdiction to jurisdiction and from case to case, as well as potential legislative changes. Increases in the number of claims filed or costs to resolve those claims could cause us to increase further the estimates of the costs associated with asbestos claims and could have a material adverse effect on our financial condition, results of operations and cash flows.

Based on ourDecember 31, 2012 liability estimate, an increase of 25% in the average per claim indemnity settlement amount would increase the liability by $42,000 and the impact on expense would be dependent upon available additional insurance recoveries. Assuming no change to the assumptions currently used to estimate our insurance asset, this increase would result in a charge on our consolidated statement of operations of approximately 85% of the increase in the liability. Long-term cash flows would ultimately change by the same amount. Should there be an increase in the estimated liability in excess of 25%, the percentage of that increase that would be expected to be funded by additional insurance recoveries will decline.

United Kingdom

Some of our subsidiaries in the U.K. have also received claims alleging personal injury arising from exposure to asbestos. To date, 1,043 claims have been brought against our U.K. subsidiaries, of which 284 remained open as of September 30, 2013. None of the settled claims have resulted in material costs to us.

The following table summarizes our asbestos-related liabilities and assets for our U.K. subsidiaries based on open (outstanding) claims and our estimate for future unasserted claims through the third quarter of 2028:

U.K. Asbestos	September 30, 2013		December 31, 2012
Asbestos-related assets:
Accounts and notes receivable-other	$	1,021	$	1,022
Asbestos-related insurance recovery receivable		27,993		29,687
Total asbestos-related assets	$	29,014	$	30,709
Asbestos-related liabilities:
Accrued expenses	$	1,021	$	1,022
Asbestos-related liability		30,252		31,950
Total asbestos-related liabilities	$	31,273	$	32,972
Liability balance by claim category:
Open claims	$	6,177	$	7,843
Future unasserted claims		25,096		25,129
Total asbestos-related liabilities	$	31,273	$	32,972

The liability estimates are based on a U.K. House of Lords judgment that pleural plaque claims do not amount to a compensable injury. If this ruling is reversed by legislation, the total asbestos liability recorded in the U.K. would increase to approximately $44,700, with a corresponding increase in the asbestos-related asset.

Project Claims

In addition to the specific matters described below, in the ordinary course of business, we are parties to litigation involving clients and subcontractors arising out of project contracts. Such litigation includes claims and counterclaims by and against us for canceled contracts, for additional costs incurred in excess of current contract provisions, as well as for back charges for alleged breaches of warranty and other contract commitments. If we were found to be liable for any of the claims/counterclaims against us, we would incur a charge against earnings to the extent a reserve had not been established for the matter in our accounts or if the liability exceeds established reserves.

Due to the inherent commercial, legal and technical uncertainties underlying the estimation of our project claims, the amounts ultimately realized or paid by us could differ materially from the balances, if any, included in our financial statements, which could result in additional material charges against earnings, and which could also materially adversely impact our financial condition and cash flows.

Power Plant Arbitration – United States

In June 2011, a demand for arbitration was filed with the American Arbitration Association by our client's erection contractor against our client and us in connection with a power plant project in the U.S.  At that time, no details of the erection contractor's claims were included with the demand. The arbitration panel was formed on September 26, 2012 and a detailed Statement of Claim from the erection contractor was delivered to the panel on October 24, 2012.According to the claim, the erection contractor is seeking unpaid contract amounts from our client and additional compensation from our client and us for alleged delays, disruptions, inefficiencies, and extra work in connection with the erection of the plant.  We supplied the steam generation equipment for the project under contract with our client, the power plant owner.  The turbine contractor, who supplied the turbine, electricity generator and other plant equipment under a separate contract with the power plant owner, has also been included as a party in the arbitration. The erection contractor is seeking approximately $240,000 in damages, exclusive of interest, from our client.  Of this amount, the statement of claim asserts that approximately $150,000 is related to the steam generation equipment, and alleges failure on our part in connection with our performance under our steam generation equipment supply contract; those damages are claimed jointly against us and our client. The claims against us by the erection contractor allege negligence and, in its purported capacity as a third party beneficiary and assignee of our steam generation equipment supply contract, breach of contract.

Responsive pleadings to the erection contractor's pleading were filed by the other parties, including us, on November 28, 2012.  Our pleading denies the erection contractor's claims against us and asserts cross claims against our client seeking over $14,800 in damages related to delays, out of scope work, and improperly assessed delay liquidated damages. In its pleading, the turbine contractor asserts claims against our client for unpaid contract amounts and additional compensation for extra work and delays. In its capacity as a purported co-assignee of the steam generation equipment supply contract, the turbine contractor joins in the erection contractor's claims against us for delay-related damages and asserts cross claims against us seeking over $5,000 in non-delay related damages.  In its pleading, our client asserts counter and cross claims for breach of contract and gross negligence against the erection contractor and the turbine contractor. Our client also asserts cross claims against us for any damages our client has incurred, and for indemnification of any damages our client may be required to pay to the erection and turbine contractors, arising out of alleged failures of performance on our part under our steam generation supply contract. We have denied our client's and the turbine contractor's cross claims against us.

On August 30, 2013, our client filed a petition with the U.S. Bankruptcy Court, for the District of Delaware, seeking to reorganize under Chapter 11 of the U.S. Bankruptcy Code. The filing automatically stayed all proceedings against our client, including the four-party arbitration discussed above. Our client'sfilingincluded a motion seeking authorization for the use of cash collateralto fund its activities during the bankruptcy proceedings. In its motion, our client indicated its intent to draw on performance and retention letters of credit we previously issued in connection with the contract totaling approximately $59,000, contending that the funds were needed to fund the bankruptcy and make repairs to the power plant. We opposed the motion on various grounds, including that any such draw would be unsupported and wrongful, and applied for an order temporarily restraining our client from drawing on the letters of credit, lifting the automatic stay of the arbitration proceeding and transferring the question of our client's right to draw on our letters of credit back to the arbitration for resolution in the context of the overall dispute. The bankruptcy court granted our application for temporary restraintand scheduled a further hearing on the issue, which on successive applications by our client was adjourned to November 21, 2013. On November 1, 2013, our client filed a motion seeking the bankruptcy court's approval of proposed debtor-in-possession financing. Based upon the timetable proposed in the motion, it does not appear that the bankruptcy court will decide the question of our client's right to draw on our letters of credit on November 21, 2013. The date for decision on that question is at present uncertain. The court's temporary restraint order remains in place while the court's decision on the draw remains open.

We cannot predict the ultimate outcome of this matter at thistime.

Refinery and Petrochemicals Project Arbitration – India

In November 2012, we commenced arbitration in India against our clientseeking collection of unpaid receivablesin excess of £52,000 (approximately $83,900 based on the exchange rate in effect as of September 30, 2013), arising from services performed on a reimbursable basis for our client in connection with our client's grass roots refinery and petrochemicals project in northeastern India. Our client rejected the claims and notified us of various potential counterclaims that it may be asserting in the arbitration, purportedly totaling in excess of £55,000(approximately $88,800based on the exchange rate in effect as of September 30, 2013). In June 2013, we submitted our detailed statement of claim, and in July 2013 our client submitted its detailed statement of defense and counterclaim. The amount of the counterclaim was increased to approximately £620,000 (approximately $1,000,800based on the exchange rate in effect as of September 30, 2013) in damages, including among other claims a claim for lost profits due to delay in the execution of the project. The counterclaim concerns a number of alleged issues arising in connection with our execution of the engineering, procurement, and construction management scope of our contract, from the period from contract award until the subsequent transfer by our client of our remaining engineering, procurement and construction management scope to certain lump sum turnkey contractors hired directly by our client. Our client further contends that we are liable for delays to the project and has withheld payment on account of delay liquidated damages and, out of the total claim of £620,000 (approximately $1,000,800based on the exchange rate in effect as of September 30, 2013) cited above, is seeking damages for lost profits in the amount of £555,000 (approximately $895,900based on the exchange rate in effect as of September 30, 2013). We strongly dispute these contentions.Any liability for delay damages is capped under the contract at a specified percentage of our contract value, currently equivalent to approximately £11,500 (approximately $18,600based on the exchange rate in effect as of September 30, 2013), an amount already retained by our client. The contract also excludes liability for consequential damages, including lost profits, and contains an overall cap on liability for claims in the aggregate of up to a specified percentage of our contract value, currently equivalent to approximately £28,800 (approximately $46,500based on the exchange rate in effect as of September 30, 2013). The unpaid amount for which we are seeking reimbursement in the arbitration may increase should our client continue to withhold amounts from our invoices, as the project is still in execution. The arbitration panel has been formed. Our client moved to dismiss the arbitration as premature under the terms of the contract, and we opposed that motion. The motion has been denied by the panel. Also, pursuant to our request, the panel has scheduled a hearing early in the first quarter of 2014 for our claims for unpaid receivables, along with our client's counterclaim for a deductive change order in the amount of approximately £21,600 (approximately $34,900 based on the exchange rate in effect as of September 30, 2013). The remaining claims and counterclaims, including our client's counterclaim for lost profits, are scheduled to be heard late in the fourth quarter of 2014. We cannot predict the ultimate outcome of this matter at this time.

Environmental Matters

CERCLA and Other Remedial Matters

Under U.S. federal statutes, such as the Resource Conservation and Recovery Act, Comprehensive Environmental Response, Compensation, and Liability Act of 1980 (“CERCLA”), the Clean Water Act and the Clean Air Act, and similar state laws, the current owner or operator of real property and the past owners or operators of real property (if disposal of toxic or hazardous substances took place during such past ownership or operation) may be jointly and severally liable for the costs of removal or remediation of toxic or hazardous substances on or under their property, regardless of whether such materials were released in violation of law or whether the owner or operator knew of, or was responsible for, the presence of such substances. Moreover, under CERCLA and similar state laws, persons who arrange for the disposal or treatment of hazardous or toxic substances may also be jointly and severally liable for the costs of the removal or remediation of such substances at a disposal or treatment site, whether or not such site was owned or operated by such person, which we refer to as an off-site facility. Liability at such off-site facilities is typically allocated among all of the financially viable responsible parties based on such factors as the relative amount of waste contributed to a site, toxicity of such waste, relationship of the waste contributed by a party to the remedy chosen for the site and other factors.

We currently own and operate industrial facilities and we have also transferred our interests in industrial facilities that we formerly owned or operated. It is likely that as a result of our current or former operations, hazardous substances have affected the facilities or the real property on which they are or were situated. We also have received and may continue to receive claims pursuant to indemnity obligations from the present owners of facilities we have transferred, which claims may require us to incur costs for investigation and/or remediation.

We are currently engaged in the investigation and/or remediation under the supervision of the applicable regulatory authorities at four of our or our subsidiaries' former facilities (including Mountain Top, which is described below). In addition, we sometimes engage in investigation and/or remediation without the supervision of a regulatory authority. Although we do not expect the environmental conditions at our present or former facilities to cause us to incur material costs in excess of those for which reserves have been established, it is possible that various events could cause us to incur costs materially in excess of our present reserves in order to fully resolve any issues surrounding those conditions. Further, no assurance can be provided that we will not discover additional environmental conditions at our currently or formerly owned or operated properties, or that additional claims will not be made with respect to formerly owned properties, requiring us to incur material expenditures to investigate and/or remediate such conditions.

We have been notified that we are a potentially responsible party (“PRP”) under CERCLA or similar state laws at three off-site facilities. At each of these sites, our liability should be substantially less than the total site remediation costs because the percentage of waste attributable to us compared to that attributable to all other PRPs is low. We do not believe that our share of cleanup obligations at any of the off-site facilities as to which we have received a notice of potential liability will exceed $500 in the aggregate. We have also received and responded to a request for information from the United States Environmental Protection Agency (“USEPA”) regarding a fourth off-site facility. We do not know what, if any, further actions USEPA may take regarding this fourth off-site facility.

Mountain Top

In February 1988, one of our subsidiaries, Foster Wheeler Energy Corporation (“FWEC”), entered into a Consent Agreement and Order with the USEPA and the Pennsylvania Department of Environmental Protection (“PADEP”) regarding its former manufacturing facility in Mountain Top, Pennsylvania. The order essentially required FWEC to investigate and remediate as necessary contaminants, including trichloroethylene (“TCE”), in the soil and groundwater at the facility. Pursuant to the order, in 1993 FWEC installed a “pump and treat” system to remove TCE from the groundwater. It is not possible at the present time to predict how long FWEC will be required to operate and maintain this system.

In the fall of 2004, FWEC sampled the private domestic water supply wells of certain residences in Mountain Top and identified approximately 30 residences whose wells contained TCE at levels in excess of Safe Drinking Water Act standards. The subject residences are located approximately one mile to the southwest of where the TCE previously was discovered in the soils at the former FWEC facility. Since that time, FWEC, USEPA and PADEP have cooperated in responding to the foregoing. Although FWEC believed the evidence available was not sufficient to support a determination that FWEC was responsible for the TCE in the residential wells, FWEC immediately provided the affected residences with bottled water, followed by water filters, and, pursuant to a settlement agreement with USEPA, it hooked them up to the public water system. Pursuant to an amendment of the settlement agreement, FWEC subsequently agreed with USEPA to arrange and pay for the hookup of several additional residences, even though TCE has not been detected in the wells at those residences.  The hookups to the agreed upon residences have been completed, and USEPA has provided FWEC with a certificate that FWEC has completed its obligations related to the above-described settlement agreement (as amended). FWEC may be required to pay the agencies' costs in overseeing and responding to the situation.

FWEC is also incurring further costs in connection with a Remedial Investigation / Feasibility Study (“RI/FS”) that in March 2009 it agreed to conduct. During the fourth quarter of 2012, FWEC received a USEPA demand under the foregoing agreement for payment of $1,040 of response costs USEPA claims it incurred from the commencement of the RI/FS in April 2009 through February 2012. FWEC questioned the amount of the invoice and based upon discussions with the USEPA, a revised invoice was received on June 17, 2013 for the reduced amount of $1,004. During the third quarter of 2013, FWEC received a USEPA invoice under the foregoing agreement for payment of $258 of response costs USEPA claims it incurred from March 2012 to February 2013. In April 2009, USEPA proposed for listing on the National Priorities List (“NPL”) an area consisting of FWEC's former manufacturing facility and the affected residences, but it also stated that the proposed listing may not be finalized if FWEC complies with its agreement to conduct the RI/FS. FWEC submitted comments opposing the proposed listing.

FWEC has accrued its best estimate of the cost of all of the foregoing, and it reviews this estimate on a quarterly basis.

Other costs to which FWEC could be exposed could include, among other things, FWEC's counsel and consulting fees, further agency oversight and/or response costs, costs and/or exposure related to potential litigation, and other costs related to possible further investigation and/or remediation. At present, it is not possible to determine whether FWEC will be determined to be liable for some or all of the items described in this paragraph or to reliably estimate the potential liability associated with the items. If one or more third-parties are determined to be a source of the TCE, FWEC will evaluate its options regarding the potential recovery of the costs FWEC has incurred, which options could include seeking to recover those costs from those determined to be a source.

Other Environmental Matters

Our operations, especially our manufacturing and power plants, are subject to comprehensive laws adopted for the protection of the environment and to regulate land use. The laws of primary relevance to our operations regulate the discharge of emissions into the water and air, but can also include hazardous materials handling and disposal, waste disposal and other types of environmental regulation. These laws and regulations in many cases require a lengthy and complex process of obtaining licenses, permits and approvals from the applicable regulatory agencies. Noncompliance with these laws can result in the imposition of material civil or criminal fines or penalties. We believe that we are in substantial compliance with existing environmental laws. However, no assurance can be provided that we will not become the subject of enforcement proceedings that could cause us to incur material expenditures. Further, no assurance can be provided that we will not need to incur material expenditures beyond our existing reserves to make capital improvements or operational changes necessary to allow us to comply with future environmental laws.

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Derivative Financial Instruments

9 Months Ended

Sep. 30, 2013

Derivative Instruments and Hedging Activities Disclosure [Abstract]

Derivative Financial Instruments

8. Derivative Financial Instruments

We are exposed to certain risks relating to our ongoing business operations. The risks managed by using derivative financial instruments relate primarily to foreign currency exchange rate risk and, to a significantly lesser extent, interest rate risk. Derivative financial instruments held by our consolidated entities are recognized as assets or liabilities at fair value on our consolidated balance sheet. Our proportionate share of the fair value of derivative financial instruments held by our equity method investees is included in investments in and advances to unconsolidated affiliates on our consolidated balance sheet. The fair values of derivative financial instruments held by our consolidated entities were as follows:

Fair Values of Derivative Financial Instruments
					Asset Derivatives						Liability Derivatives
			Balance Sheet		September 30,		December 31,		Balance Sheet		September 30,		December 31,
			Location		2013		2012		Location		2013		2012
Derivatives designated as
		hedging instruments:
	Interest rate swap
		contracts	Other assets		$	-	$	-	Other long-term liabilities		$	8,809	$	10,490
Derivatives not designated
		as hedging instruments:
	Foreign currency		Contracts in process or						Contracts in process or
		forward contracts		billings in excess of costs						billings in excess of costs
				and estimated earnings on						and estimated earnings on
				uncompleted contracts		7,603		6,040		uncompleted contracts		1,663		4,895
	Foreign currency
		forward contracts	Other accounts receivable			335		1,357	Accounts payable			481		29
Total derivatives					$	7,938	$	7,397			$	10,953	$	15,414

Foreign Currency Exchange Rate Risk

We operate on a worldwide basis with operations that subject us to foreign currency exchange rate risk mainly relative to the British pound, Chinese Yuan, Euro and U.S. dollar as of September 30, 2013. Under our risk management policies, we do not hedge translation risk exposure. All activities of our affiliates are recorded in their functional currency, which is typically the local currency in the country of domicile of the affiliate. In the ordinary course of business, our affiliates enter into transactions in currencies other than their respective functional currencies. We seek to minimize the resulting foreign currency transaction risk by contracting for the procurement of goods and services in the same currency as the sales value of the related long-term contract. We further mitigate the risk through the use of foreign currency forward contracts to hedge the exposed item, such as anticipated purchases or revenues, back to their functional currency.

The notional amount of our foreign currency forward contracts provides one measure of our transaction volume outstanding as of the balance sheet date. As of September 30,2013, we had a total gross notional amount, measured in U.S. dollar equivalent, ofapproximately $446,500related to foreign currency forward contracts. Amounts ultimately realized upon finalsettlement of these financial instruments, along with the gains and losses on the underlying exposures within our long-term contracts, will depend on actual market exchange rates during the remaining life of the instruments. The contract maturity dates range from the remainder of 2013 through 2015.

We are exposed to credit loss in the event of non-performance by the counterparties. These counterparties are commercial banks that are primarily rated “BBB+” or better by S&P (or the equivalent by other recognized credit rating agencies).

Increases in the fair value of the currencies sold forward result in losses while increases in the fair value of the currencies bought forward result in gains. For foreign currency forward contracts used to mitigate currency risk on our projects, the gain or loss from the portion of the mark-to-market adjustment related to the completed portion of the underlying project is included in cost of operating revenues at the same time as the underlying foreign currency exposure occurs. The gain or loss from the remaining portion of the mark-to-market adjustment, specifically the portion relating to the uncompleted portion of the underlying project is reflected directly in cost of operating revenues in the period in which the mark-to-market adjustment occurs. We also utilize foreign currency forward contracts to mitigate non-project related currency risks, which are recorded in other deductions, net.

The gain or loss from the remaining uncompleted portion of our projects and other non-project related transactions were as follows:

	Location of Gain/(Loss)	Amount of Gain/(Loss) Recognized in Income on Derivatives
Derivatives Not Designated as	Recognized	Quarter Ended September 30,				Nine Months Ended September 30,
Hedging Instruments	in Income on Derivatives		2013		2012		2013		2012
Foreign currency forward contracts	Cost of operating revenues	$	5,616	$	1,692	$	1,700	$	1,192
Foreign currency forward contracts	Other deductions, net		121		753		(1,402)		831
Total		$	5,737	$	2,445	$	298	$	2,023

The mark-to-market adjustments on foreign currency forward contracts for these unrealized gains or losses are primarily recorded in either contracts in process or billings in excess of costs and estimated earnings on uncompleted contracts on the consolidated balance sheet.

During the nine months endedSeptember 30, 2013 and 2012, we included net cash inflows on the settlement of derivatives of $5,179and $1,521, respectively, within the “net change in contracts in process and billings in excess of costs and estimated earnings on uncompleted contracts,” a component of cash flows from operating activities on the consolidated statement of cash flows.

Interest Rate Risk

We use interest rate swap contracts to manage interest rate risk associated with a portion of our variable rate special-purpose limited recourse project debt. The aggregate notional amount of the receive-variable/pay-fixed interest rate swaps for our consolidated entities was $59,300as of September 30, 2013.

Upon entering into the swap contracts, we designate the interest rate swaps as cash flow hedges. We assess at inception, and on an ongoing basis, whether the interest rate swaps are highly effective in offsetting changes in the cash flows of the project debt. Consequently, we record the fair value of interest rate swap contracts on our consolidated balance sheet at each balance sheet date. Changes in the fair value of the interest rate swap contracts are recorded as a component of other comprehensive income. Amounts that are reclassified from accumulated other comprehensive loss are recognized within interest expense on the consolidated statement of operations.

The impact from interest rate swap contracts in cash flow hedging relationships for our consolidated entities was as follows:

		Quarter Ended September 30,				Nine Months Ended September 30,
			2013		2012		2013		2012
Unrealized loss recognized in other comprehensive income		$	(817)	$	(1,766)	$	(6)	$	(3,551)
Loss reclassified from accumulated other comprehensive loss
	to interest expense		630		572		1,885		1,507

The above balances for our consolidated entities and our proportionate share of the impact from interest rate swap contracts in cash flow hedging relationships held by our equity method investees are included on our consolidated statement of comprehensive income net of tax.

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Litigation and Uncertainties (Summary of asbestos related payments and insurance settlement proceeds - Table) (Details) (United States [Member], USD $) In Thousands, unless otherwise specified	3 Months Ended		9 Months Ended
	Sep. 30, 2013	Sep. 30, 2012	Sep. 30, 2013	Sep. 30, 2012
United States [Member]
Asbestos litigation, defense and case resolution payments	$ 12,400	$ 12,100	$ 38,800	$ 40,700
Insurance proceeds	(15,500)	(15,800)	(43,800)	(37,500)
Net asbestos-related payments	$ (3,100)	$ (3,700)	$ (5,000)	$ 3,200

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Summary of Significant Accounting Policies (Tables)

9 Months Ended

Sep. 30, 2013

Summary of Significant Accounting Policies [Abstract]

Projects With Final Estimated Contract Profit Revisions Whose Impact Exceeds $1 million - Table

		Quarter Ended September 30,				Nine Months Ended September 30,
			2013		2012		2013		2012
Number of separate projects			10		12		28		27
Net increase in contract profit from the regular
	revaluation of final estimated contract profit revisions	$	30,200	$	22,700	$	74,800	$	58,000

Basic and Diluted EPS - Table

		Quarter Ended September 30,				Nine Months Ended September 30,
			2013		2012		2013		2012
Income from continuing operations attributable
	to Foster Wheeler AG	$	48,853	$	58,667	$	134,073	$	130,578
Basic weighted-average number of shares outstanding			98,172,200		107,065,999		100,830,719		107,558,489
Effect of dilutive securities			431,386		253,963		495,874		298,879
Diluted weighted-average number of shares outstanding			98,603,586		107,319,962		101,326,593		107,857,368
Income from continuing operations per share:
	Basic	$	0.50	$	0.55	$	1.33	$	1.22
	Diluted	$	0.50	$	0.55	$	1.32	$	1.21

Antidilutive Securities - Table

	Quarter Ended September 30,		Nine Months Ended September 30,
	2013	2012	2013	2012
Stock options	1,356,167	2,809,894	1,393,499	2,809,894
Performance-based restricted share units	1,144,694	-	1,144,694	-

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Discontinued Operations

9 Months Ended

Sep. 30, 2013

Discontinued Operations [Abstract]

Discontinued Operations

13.Discontinued Operations

During the first quarter of 2013, we recorded an impairment charge of $3,919 at our waste-to-energy facility in Camden, New Jersey within our Global Power Group business segment. This charge was in addition to an impairment charge of $11,455 recorded during the fourth quarter of 2012. The impairment charges in both periods included estimates related to the continued operation of the facility and potential sale of the facility. The charge in the first quarter of 2013 was the result of updating our estimate related to the potential sale of the facility and the impairment charge was recorded within income from discontinued operations on our consolidated statement of operations. After recording the impairment charge and after approval of the plan to sell the facility, discussed below, the carrying value of the facility's fixed assets approximated fair value less estimated costs to sell the facility.

On April 17, 2013, our Board of Directors approved a plan to sell ourCamden facility and we completed the sale of the facility in August 2013. The presentation of the financial results and asset and liability balancesof this businessfor the periods prior to the completion of the sale have been reclassified on our consolidated statement of operations, consolidated balance sheet and consolidated statement of cash flows under the respective captions related to discontinued operations, and these reclassifications have been made in the notes to our consolidated financial statements.Prior to the sale, the business had been classified on our consolidated balance sheet as of June 30, 2013 under the respective current and non-current captions of assets held for sale and liabilities held for sale as a result of our Board of Directors' approval of our plan to sell the facility, which met the accounting criteria as a business held for sale and the criteria for classification as a discontinued operation. We didnot recognize depreciation on long-lived assets while held for sale. Our Camden facility was formerly included in our Global Power Group business segment.

We completed the sale of our Camden facility in August 2013. Based on the proceeds received and costs of disposal, we recognized a gain of $300 within income/(loss) from discontinued operations before income taxes on the consolidated statement of operations during the quarter and nine months ended September 30, 2013.

The following are the main classes of assets and liabilities that were associated with our discontinued operations as of December 31, 2012:

		December 31, 2012
Assets:
Trade accounts and notes receivable, net		$	1,482
Other current assets			23
	Current assets of discontinued operations		1,505
Land, buildings and equipment, net			48,739
Restricted cash			840
	Long-term assets of discontinued operations	$	49,579
Liabilities:
Accounts payable		$	1,814
Accrued expenses			595
Advance payments			745
	Liabilities of discontinued operations	$	3,154

Operating revenues related to our discontinued operations, which were exclusively in the U.S., were $3,991 and $5,936during the third quarter of2013 and 2012, respectively, and $17,053 and $18,006 during the nine months ended September 30, 2013 and 2012, respectively.

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Document Entity Information	9 Months Ended
	Sep. 30, 2013	Oct. 25, 2013
Document And Entity Information [Abstract]
Entity Registrant Name	Foster Wheeler AG
Entity Central Index Key	0001130385
Current Fiscal Year End Date	--12-31
Document Type	10-Q
Amendment Flag	false
Document Period End Date	Sep. 30, 2013
Document Fiscal Year Focus	2013
Document Fiscal Period Focus	Q3
Entity Well-known Seasoned Issuer	Yes
Entity Current Reporting Status	Yes
Entity Filer Category	Large Accelerated Filer
Entity Common Stock, Shares Outstanding		98,393,359

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Summary of Significant Accounting Policies (Policy)

9 Months Ended

Sep. 30, 2013

Summary of Significant Accounting Policies [Abstract]

Basis of Presentation

Basis of Presentation — The fiscal year of Foster Wheeler AG ends on December 31 of each calendar year. Foster Wheeler AG's fiscal quarters end on the last day of March, June and September. The fiscal years of our non-U.S. operations are the same as the parent's. The fiscal year of our U.S. operations is the 52- or 53-week annual accounting period ending on the last Friday in December.

The accompanying consolidated financial statements are unaudited. In the opinion of management, all adjustments necessary for a fair presentation of such financial statements have been included. Such adjustments only consisted of normal recurring items. Interim results are not necessarily indicative of results for a full year.

The consolidated financial statements and notes are presented in accordance with the requirements of Form 10-Q and do not contain certain information included in our Annual Report on Form 10-K for the year ended December 31, 2012 (“2012 Form 10-K”), filed with the Securities and Exchange Commission on March 1, 2013. The consolidated balance sheet as of December 31, 2012 was derived from the audited financial statements included in our 2012Form 10-K, but does not include all disclosures required by accounting principles generally accepted in the United States of America for annual consolidated financial statements.

Certain prior period amounts have been reclassified to conform to the current period presentation. These reclassifications include the presentation of our Statement of Comprehensive Income as a result of our adoption of “ASU No. 2013-02, Comprehensive Income (Topic 220): Reporting of Amounts Reclassified Out of Accumulated Other Comprehensive Income”, or ASU No. 2013-02. ASU No. 2013-02was issued by the Financial Accounting Standards Board in February 2013. The standard requires disclosure of the effects on the line items of net income for significant amounts reclassified out of accumulated other comprehensive income and a cross-reference to other disclosures when a portion of the amount reclassified out of accumulated other comprehensive income is initially transferred to a balance sheet account (e.g., contracts in process or billings in excess of costs and estimated earnings on uncompleted contracts for pension-related amounts) instead of directly to income or expense. The adoption of this standard did not have an impact on our results of operations, financial position or cash flows.

Reclassifications from accumulated other comprehensive loss related to cash flow hedges amounted to losses of $741 and $2,356during the quarter and nine months ended September 30, 2013, respectively, and $679 and $1,717 during the quarter and nine months ended September 30, 2012, respectively.  These losses included amounts related to our consolidated entities and our proportionate share of the impact from interest rate swap contracts in cash flow hedging relationships held by our equity method investees.  Amounts that are reclassified from accumulated other comprehensive loss related to cash flow hedges from our consolidated entities are recognized within interest expense on the consolidated statement of operations, whereas amounts related to our equity method investees are recognized within equity earnings in other income, net on the consolidated statement of operations. Please refer to Note 8 for further information.

Reclassifications from accumulated other comprehensive loss related to pension and other postretirement benefits are included as a component of net periodic pension cost.  Please refer to Note 6 for further information.

The tax effect related to foreign currency translation adjustments was inconsequential during the quarters and nine months ended September 30, 2013 and 2012.

Reclassifications also include the presentation of our former waste-to-energy business as a result of its classification as held-for-sale and, in turn, discontinued operations. Please refer to Note 13 for further information.

The consolidated financial statements include the accounts of Foster Wheeler AG and all U.S. and non-U.S. subsidiaries, as well as certain entities in which we have a controlling interest. Intercompany transactions and balances have been eliminated. See “—Variable Interest Entities” below for further information related to the consolidation of variable interest entities.

Use of Estimates

Use of Estimates — The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities at the date of the financial statements and revenues and expenses during the periods reported. Actual results could differ from those estimates. Changes in estimates are reflected in the periods in which they become known. Significant estimates are used in accounting for long-term contracts including estimates of total costs, progress toward completion and customer and vendor claims, employee benefit plan obligations and share-based compensation plans. In addition, we also use estimates when accounting for uncertain tax positions and deferred taxes, asbestos liabilities and expected recoveries and when assessing goodwill for impairment, among others.

Revenue Recognition on Long-Term Contracts

Revenue Recognition on Long-Term Contracts — Revenues and profits on long-term contracts are recorded under the percentage-of-completion method.

Progress towards completion on fixed-price contracts is measured based on physical completion of individual tasks for all contracts with a value of $5,000 or greater. For contracts with a value less than $5,000, progress toward completion is measured based on the ratio of costs incurred to total estimated contract costs (the cost-to-cost method).

Progress towards completion on cost-reimbursable contracts is measured based on the ratio of quantities expended to total forecasted quantities, typically man-hours. Incentives are also recognized on a percentage-of-completion basis when the realization of an incentive is assessed as probable. We include flow-through costs consisting of materials, equipment or subcontractor services as both operating revenues and cost of operating revenues on cost-reimbursable contracts when we have overall responsibility as the contractor for the engineering specifications and procurement or procurement services for such costs. There is no contract profit impact of flow-through costs as they are included in both operating revenues and cost of operating revenues.

Contracts in process are stated at cost, increased for profits recorded on the completed effortor decreased for estimated losses, less billings to the customer and progress payments on uncompleted contracts. A full provision for loss contracts is made at the time the loss becomes probable regardless of the stage of completion.

At any time, we have numerous contracts in progress, all of which are at various stages of completion. Accounting for revenues and profits on long-term contracts requires estimates of total contract costs and estimates of progress toward completion to determine the extent of revenue and profit recognition. These estimates may be revised as additional information becomes available or as specific project circumstances change. We review all of our material contracts on a monthly basis and revise our estimates as appropriate for developments such as earning project incentive bonuses, incurring or expecting to incur contractual liquidated damages for performance or schedule issues, providing services and purchasing third-party materials and equipment at costs differing from those previously estimated and testing completed facilities, which, in turn, eliminates or confirms completion and warranty-related costs. Project incentives are recognized when it is probable they will be earned. Project incentives are frequently tied to cost, schedule and/or safety targets and, therefore, tend to be earned late in a project's life cycle.

Changes in estimated final contract revenues and costs can either increase or decrease the final estimated contract profit. In the period in which a change in estimate is recognized, the cumulative impact of that change is recorded based on progress achieved through the period of change. The following table summarizes the number of separate projects that experienced final estimated contract profit revisions with an impact on contract profit in excess of $1,000 relating to the revaluation of work performed in prior periods:

		Quarter Ended September 30,				Nine Months Ended September 30,
			2013		2012		2013		2012
Number of separate projects			10		12		28		27
Net increase in contract profit from the regular
	revaluation of final estimated contract profit revisions	$	30,200	$	22,700	$	74,800	$	58,000

The changes in final estimated contract profit revisions for our Global Power Group were increased during the nine months ended September 30, 2012for a favorable settlement with a subcontractor of approximately $6,900 recognized in the first quarter of 2012.The changes in final estimated contract profit revisions for our Global E&C Group and our financial results did not include an increase in final estimated contract profit of approximately $5,300 during the quarter and nine months ended September 30, 2012. The correction was recorded in the quarter ended December 31, 2012 as it was not material to the financial results for the quarter and nine months ended September 30, 2012 (the periods in which it should have been recorded), nor was it material to the financial results for the year ended December 31, 2012.

Please see Note 11 for further information related to changes in final estimated contract profitand the impact on business segment results.

Claims are amounts in excess of the agreed contract price (or amounts not included in the original contract price) that we seek to collect from customers or others for delays, errors in specifications and designs, contract terminations, disputed or unapproved change orders as to both scope and price or other causes of unanticipated additional costs. We record claims as additional contract revenue if it is probable that the claims will result in additional contract revenue and if the amount can be reliably estimated. These two requirements are satisfied by the existence of all of the following conditions: the contract or other evidence provides a legal basis for the claim; additional costs are caused by circumstances that were unforeseen at the contract date and are not the result of deficiencies in our performance; costs associated with the claim are identifiable or otherwise determinable and are reasonable in view of the work performed; and the evidence supporting the claim is objective and verifiable. If such requirements are met, revenue from a claim may be recorded only to the extent that contract costs relating to the claim have been incurred, which can include amounts from unapproved change orders when the two requirements described above are met. Unapproved change orders or similar items subject to uncertainty that do not meet the two requirements described above are expensed without the recognition of additional contract revenue. Costs attributable to claims are treated as costs of contract performance as incurred and are recorded in contracts in process. Our consolidated financial statements included commercial claims of $4,600 and $8,800 as of September 30, 2013 and December 31, 2012, respectively,of which substantially all costs had been incurred as of September 30, 2013 and December 31, 2012.

In certain circumstances, we may defer pre-contract costs when it is probable that these costs will be recovered under a future contract. Such deferred costs would then be included in contract costs upon execution of the anticipated contract. In the event that we defer pre-contract costs and we are not successful in obtaining the contract, we write off the deferred costs through our consolidated statement of operations in the period when we no longer assess recoverability of such costs as probable. Deferred pre-contract costs were inconsequentialas of September 30, 2013 and December 31, 2012.

Certain special-purpose subsidiaries in our Global Power Group business segment are reimbursed by customers for their costs ofbuilding and operating certain facilities over the lives of the corresponding service contracts. Depending on the specific legal rights and obligations under these arrangements, in some cases those reimbursements are treated as operating revenues at gross value and other cases as a reduction of cost.

Trade Accounts Receivable

Trade Accounts Receivable — Trade accounts receivable represent amounts billed to customers. We assess the need for an allowance for doubtful accounts on a project-by-project basis, which includes the consideration of security instruments that provide us protection in the event of non-payment. When there is a risk of non-payment related to customer credit risk, we record an allowance for doubtful accounts. Because of the nature of our customer base and our rigorous customer credit risk assessment process prior to entering into contracts, the level of our allowance for doubtful accounts is typically a very small percentage of our gross accounts receivable balance. To the extent that there is a risk of non-payment related to commercial or performance issues, we record an allowance against the valuation of contract work in progress within the contract.

In accordance with terms under our long-term contracts, our customers may withhold certain percentages of such billings until completion and acceptance of the work performed, which we refer to as retention receivables. Final payment of retention receivables mightnot be received within a one-year period. In conformity with industry practice, however, the full amount of accounts receivable, including such amounts withheld, are included in current assets on the consolidated balance sheet.We have not recorded a provision for the outstanding retention receivable balances as of September 30, 2013 or December 31, 2012.

Variable Interest Entities

Variable Interest Entities—We sometimes form separate legal entities such as corporations, partnerships and limited liability companies in connection with the execution of a single contract or project. Upon formation of each separate legal entity, we perform an evaluation to determine whether the new entity is a variable interest entity, or VIE, and whether we are the primary beneficiary of the new entity, which would require us to consolidate the new entity in our financial results. We reassess our initial determination on whether the entity is a VIE upon the occurrence of certain events and whether we are the primary beneficiary as outlined in current accounting guidelines. If the entity is not a VIE, we determine the accounting for the entity under the voting interest accounting guidelines.

An entity is determined to be a VIE if either (a) the total equity investment is not sufficient for the entity to finance its own activities without additional subordinated financial support, (b) characteristics of a controlling financial interest are missing (such as the ability to make decisions through voting or other rights or the obligation to absorb losses or the right to receive benefits), or (c) the voting rights of the equity holders are not proportional to their obligations to absorb losses of the entity and/or their rights to receive benefits of the entity, and substantially all of the entity's activities either involve or are conducted on behalf of an investor that has disproportionately few voting rights.

As of September 30, 2013 and December 31, 2012, we participated in certain entities determined to be VIEs, including a gas-fired cogeneration facility in Martinez, California and a refinery/electric power generation project in Chile.We consolidate the operations of the Martinez project while we record our participation in the project in Chile on the equity method of accounting.

Please see Note 3 for further information regarding our participation in these projects.

Fair Value Measurements

Fair Value Measurements—Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. Financial Accounting Standards Board Accounting Standards Codification, or FASB ASC, 820-10 defines fair value, establishes a three level fair value hierarchy that prioritizes the inputs used to measure fair valueand provides guidance on required disclosures about fair value measurements. The fair value hierarchy gives the highest priority to unadjusted quoted prices in active markets for identical assets or liabilities and the lowest priority to unobservable inputs.

Our financial assets and liabilities that are recorded at fair value on a recurring basis consist primarily of the assets or liabilities arising from derivative financial instruments and defined benefit pension plan assets. See Note 8for further information regarding our derivative financial instruments.

The following methods and assumptions were used to estimate the fair value of each class of financial instruments for which it is practicable to estimate fair value:

Financial instruments valued independent of the fair value hierarchy:

• Cash, Cash Equivalents and Restricted Cash— The carrying value of our cash, cash equivalents and restricted cash approximates fair value because of the demand nature of many of our deposits or short-term maturity of these instruments.

  Financial instruments valued within the fair value hierarchy:

• Long-term Debt — We estimate the fair value of our long-term debt (including current installments) based on the quoted market prices for the same or similar issues or on the current rates offered for debt of the same remaining maturitiesusing level 2 inputs.
• Foreign Currency Forward Contracts — We estimate the fair value of foreign currency forward contracts by obtaining quotes from financial institutions or market transactions in either the listed or over-the-counter markets. Our estimate of the fair value of foreign currency forward contracts also includes an assessment of non-performance by our counterparties. We further corroborate the valuations with observable market data using level 2 inputs.
• Interest Rate Swaps— We estimate the fair value of our interest rate swaps based on quotes obtained from financial institutions, which we further corroborate with observable market datausing level 2 inputs.
• Defined Benefit Pension Plan Assets — We estimate the fair value of investments in equity securities at each year-end based on quotes obtained from financial institutions. The fair value of investments in commingled funds, invested primarily in debt and equity securities, is based on the net asset values communicated by the respective asset manager. We further corroborate the above valuations with observable market data using level 1 and 2 inputs. Additionally, we hold investments in private investment funds that are valued at net asset value as communicated by the asset manager using level 3 unobservable market data inputs.

Retirement of Shares under Share Repurchase Program

Retirement of Shares under Share Repurchase Program — Under Swiss law, the cancellation of shares previously repurchased under our share repurchase program must be approved by our shareholders. Repurchased shares remain as treasury shares on our balance sheet until cancellation.

Any repurchases will be made at our discretion in compliance with applicable securities laws and other legal requirements and will depend on a variety of factors, including market conditions, share price and other factors.   The program does not obligate us to acquire any particular number of shares. The program has no expiration date and may be suspended or discontinued at any time.

All treasury shares are carried at cost on the consolidated balance sheet until the cancellation of the shares has been approved by our shareholders and the cancellation is registered with the commercial register of the Canton of Zug in Switzerland. Upon the effectiveness of the cancellation of the shares, the cost of the shares cancelled will be removed from treasury shares on the consolidated balance sheet, the par value of the cancelled shares will be removed from registered shares on the consolidated balance sheet, and the excess of the cost of the treasury shares above par value will be removed from paid-in capital on the consolidated balance sheet.

Once repurchased, treasury shares are no longer considered outstanding, which results in a reduction to the weighted-average number of shares outstanding during the reporting period when calculating earnings per share, as described below.

Earnings per Share

Earnings per Share — Basic earnings per share amounts have been computed based on the weighted-average number of shares outstanding during the reporting period.

Diluted earnings per share amounts have been based on the combination of the weighted-average number of shares outstanding during the reporting period and the impact of dilutive securities, if any, such as outstanding stock options and the non-vested portion of restricted stock units and performance-based restricted stock units (collectively, “restricted awards”) to the extent such securities are dilutive.

In profitable periods, outstanding stock options have a dilutive effect under the treasury stock method when the average share price for the period exceeds the assumed proceeds from the exercise of the option. The assumed proceeds include the exercise price, compensation cost, if any, for future service that has not yet been recognized in the consolidated statement of operations, and any tax benefits that would be recorded in paid-in capital when the option is exercised. Under the treasury stock method, the assumed proceeds are assumed to be used to repurchase shares in the current period. The dilutive impact of the non-vested portion of restricted awards is determined using the treasury stock method, but the proceeds include only the unrecognized compensation cost and tax benefits as assumed proceeds.

The computations of basic and diluted earnings per share were as follows:

		Quarter Ended September 30,				Nine Months Ended September 30,
			2013		2012		2013		2012
Income from continuing operations attributable
	to Foster Wheeler AG	$	48,853	$	58,667	$	134,073	$	130,578
Basic weighted-average number of shares outstanding			98,172,200		107,065,999		100,830,719		107,558,489
Effect of dilutive securities			431,386		253,963		495,874		298,879
Diluted weighted-average number of shares outstanding			98,603,586		107,319,962		101,326,593		107,857,368
Income from continuing operations per share:
	Basic	$	0.50	$	0.55	$	1.33	$	1.22
	Diluted	$	0.50	$	0.55	$	1.32	$	1.21

The following table summarizes share-based compensation awards not included in the calculation of diluted earnings per share as the assumed proceeds from those awards, on a per share basis, were greaterthan the average share price for the period, which would result in an antidilutive effect on diluted earnings per share:

	Quarter Ended September 30,		Nine Months Ended September 30,
	2013	2012	2013	2012
Stock options	1,356,167	2,809,894	1,393,499	2,809,894
Performance-based restricted share units	1,144,694	-	1,144,694	-

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Business Segments (Operating Revenues By Industry and by Segment - Table) (Details) (USD $) In Thousands, unless otherwise specified	3 Months Ended		9 Months Ended
	Sep. 30, 2013	Sep. 30, 2012	Sep. 30, 2013	Sep. 30, 2012
Operating revenues	$ 801,826	$ 797,296	$ 2,455,377	$ 2,661,348
Africa Project Location [Member]
Operating revenues	12,694	22,475	52,341	70,136
Asia Pacific Project Location [Member]
Operating revenues	208,073	231,267	612,348	947,867
Europe Project Location [Member]
Operating revenues	192,318	189,003	596,154	647,935
Middle East Project Location [Member]
Operating revenues	91,482	65,166	236,284	178,015
North America Project Location [Member]
Operating revenues	205,570	211,711	729,583	572,826
South America Project Location [Member]
Operating revenues	91,689	77,674	228,667	244,569
Global E and C Group [Member]
Operating revenues	615,028	578,072	1,865,721	1,915,087
Global Power Group [Member]
Operating revenues	186,798	219,224	589,656	746,261
Power Generation [Member]
Operating revenues	194,258	214,742	563,713	729,178
Oil Refining [Member]
Operating revenues	323,019	337,067	1,006,651	1,022,978
Pharmaceutical [Member]
Operating revenues	29,308	13,606	107,706	40,199
Oil and Gas [Member]
Operating revenues	83,145	109,466	254,626	524,580
Chemical / Petrochemical [Member]
Operating revenues	124,284	80,209	360,831	225,956
Power Plant Design, Operation and Maintenance [Member]
Operating revenues	41,773	28,248	125,282	80,371
Environmental [Member]
Operating revenues	1,426	1,790	4,271	6,434
Other, Net of Eliminations [Member]
Operating revenues	$ 4,613	$ 12,168	$ 32,297	$ 31,652

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Income Taxes (Narrative) (Details)	9 Months Ended
	Sep. 30, 2013	Sep. 30, 2012
Income Tax Contingency [Line Items]
U.S. federal statutory rate	35.00%	35.00%
Impact on the effective tax rate for total changes in the valuation allowance	3.00%	2.00%
Impact on the effective tax rate for income earned in the jurisdictions with tax rates lower than the U.S. statutory rate	(17.00%)	(15.00%)
Impact on effective tax rate as a result of an exemption received from non-US tax authority.	(1.00%)