8-K

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 8-K

CURRENT REPORT

Pursuant to Section 13 or 15 (d) of the

Securities Exchange Act of 1934

Date of Report (Date of earliest event reported): June 29, 2011

THE BABCOCK & WILCOX COMPANY

(Exact name of registrant as specified in its charter)

DELAWARE	001-34658	80-0558025
(State or other jurisdiction of incorporation)	(Commission File Number)	(IRS Employer Identification No.)
13024 BALLANTYNE CORPORATE PLACE SUITE 700 CHARLOTTE, NORTH CAROLINA		28277
(Address of principal executive offices)		(Zip Code)

Registrant’s Telephone Number, including Area Code: (704) 625-4900

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

¨ Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

¨ Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

¨ Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

¨ Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Item 5.02 Departure of Directors or Certain Officers; Election of Directors; Appointment of Certain Officers; Compensatory Arrangements of Certain Officers.

Michael S. Taff, our Senior Vice President and Chief Financial Officer, exercised his rights under the Restructuring Transaction Retention Agreement entered into between Mr. Taff and McDermott International, Inc. (“McDermott”), our former parent company, dated as of December 10, 2009 (as assumed by us, the “Retention Agreement”) and notified us on June 29, 2011 of his decision to terminate his employment, effective July 30, 2011 (the “Termination Date”). Mr. Taff will continue to serve as our chief financial officer following the Termination Date pursuant to a consulting agreement. A summary of the consulting agreement is provided below and qualified by reference to the complete agreement which is attached as Exhibit 10.1 and incorporated herein by reference. A copy of the press release regarding Mr. Taff is furnished as Exhibit 99.1.

Following the December 2009 announcement by McDermott to spin-off The Babcock & Wilcox Company, McDermott entered into the Retention Agreement with Mr. Taff. The Retention Agreement provides, among other things, that in the event of a qualifying termination Mr. Taff would receive, subject to the execution by him of a release of claims against us and certain affiliated persons and parties, severance benefits generally consisting of (1) a cash payment equal to two times the sum of his annual base salary and target annual incentive compensation, (2) a cash payment equal to his target annual incentive compensation prorated as of his termination, (3) a cash payment equal to two years of medical benefits; (4) continued medical coverage for 48 months (Mr. Taff to be responsible for payment of COBRA premiums) and (5) full vesting of any equity awards then outstanding for at least one year from the applicable date of grant. It was contemplated in the Retention Agreement that Mr. Taff’s employment with McDermott would terminate following the spin-off (which was completed July 30, 2010) and he would serve as our chief financial officer. Moreover, the Retention Agreement provided that such change in service would not constitute a qualifying termination, and instead Mr. Taff may terminate his employment with us on the first anniversary of the spin-off and that such termination would constitute a qualifying termination entitling him to the severance benefits set forth in the Retention Agreement. In connection with the spin-off, we generally assumed the rights and obligations arising under the Retention Agreement. This summary of the Retention Agreement is qualified by reference to the complete Retention Agreement, which was filed as Exhibit 10.11 to our Form 10 filed with the Securities and Exchange Commission on April 23, 2010.

In connection with Mr. Taff’s election to terminate employment under his Retention Agreement, we entered into a Consulting Agreement with Mr. Taff dated as of June 29, 2011, under which following the Termination Date he will provide us financial services as Senior Vice President and Chief Financial Officer and assist us in the search for a successor chief financial officer until July 31, 2012, unless terminated earlier. Under the Consulting Agreement, Mr. Taff will receive (1) consulting payments of $112,629 per month, (2) a furnished apartment and a car in Charlotte, North Carolina for use during the consulting period and (3) a per diem based on the monthly consulting fee for transition assistance, if any, following the consulting period. The agreement also includes restrictions on Mr. Taff’s ability to solicit our employees during the consulting period and for a period of 12 months thereafter and to compete with us during the consulting period.

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Item 9.01 Financial Statements and Exhibits.

(d) Exhibits

99.1	Press Release
10.1	Consulting Agreement dated as of June 29, 2011 by and between The Babcock & Wilcox Company and Michael S. Taff

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.

THE BABCOCK & WILCOX COMPANY
By:	/s/ David S. Black
	David S. Black
	Vice President and Chief Accounting Officer

July 1, 2011

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EX-10.1

Exhibit 10.1

THE BABCOCK & WILCOX COMPANY

CONSULTING AGREEMENT

THIS CONSULTING AGREEMENT (the “Agreement”) is made by and between The Babcock & Wilcox Company, a corporation incorporated under the laws of the State of Delaware (“B&W”), and Michael S. Taff, an individual (“Mr. Taff”), as of June 29, 2011 (the “Effective Date”).

WHEREAS, Mr. Taff presently serves as Senior Vice President and Chief Financial Officer of B&W and has elected to terminate his employment with B&W in accordance with the Restructuring Transaction Retention Agreement by and between Mr. Taff and McDermott International, Inc. dated as of December 10, 2009 and assumed by B&W (the “Restructuring Transaction Retention Agreement”); and

WHEREAS, B&W desires to engage the services of Mr. Taff following the exercise of his rights under the Restructuring Transaction Retention Agreement to elect to terminate his employment and pending the search for a successor as chief financial officer, and Mr. Taff desires to provide such services.

NOW, THEREFORE, the parties agree as follows:

1. Description of Services.

a. Mr. Taff agrees to perform financial services for B&W during the Consulting Term (as defined in Section 8). Except as otherwise provided herein, Mr. Taff will have the title of Senior Vice President & Chief Financial Officer, and perform those tasks generally requested of him by B&W’s President and Chief Executive Officer. As requested by B&W’s Chief Executive Officer, Mr. Taff agrees to support and provide assistance in B&W’s search for another Chief Financial Officer. If B&W appoints another person as B&W’s Chief Financial Officer during the Consulting Term, Mr. Taff’s title will change to Senior Vice President. If and when Mr. Taff’s title changes to Senior Vice President, he will use his reasonable best efforts to perform all services necessary to transition the new Chief Financial Officer into his or her position. During the Consulting Term, Mr. Taff will serve as an officer and/or director of B&W’s subsidiaries and Affiliates (as defined in Section 6), as requested by B&W. The services described in this Section 1a are collectively referred to as the “Services.”

b. Following B&W’s appointment of another person as its Chief Financial Officer, at the written request of B&W’s Chief Executive Officer or Chief Financial Officer, Mr. Taff agrees to (a) cooperate with B&W in the preparation and reporting of its quarterly and/or annual financial statements in respect of any period in which Mr. Taff was Chief Financial Officer and (b) execute and deliver any certifications, representation letters and other documents as B&W may reasonably request from time to time in connection with the preparation and/or reporting of such financial statements, including, without limitation, representations to the Chief Executive Officer and Chief Financial Officer substantially similar in form and substance to the representations provided by B&W and its executive officers to B&W’s external auditors. Following the Consulting Term, B&W agrees to pay Mr. Taff $5,200.00 for each day in which Mr. Taff provides, at the written request of B&W’s Chief Executive Officer or Chief Financial Officer, such assistance.

c. Notwithstanding anything herein to the contrary, following the earlier to occur of (i) B&W’s appointment of another person as its Chief Financial Officer or (ii) the termination of the Consulting Term, Mr. Taff will not be required to execute or deliver any certifications required by

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(i) Rules 13a-14(a) and 15d-14(a) of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), or (ii) Rules 13a-14(b) and 15d-14(b) of the Exchange Act and Section 1350 of Chapter 63 of Title 18 of the United States Code, in each case with respect to the Company’s quarterly and/or annual financial statements.

2. Status. Mr. Taff acknowledges and agrees that at all times during the Consulting Term when Mr. Taff is providing Services to B&W and B&W’s subsidiaries and Affiliates (collectively, “Company”), Mr. Taff is an independent contractor and not an “employee” (or person of similar status) of the Company for purposes of: (1) the Internal Revenue Code of 1986, as amended (hereinafter “Code”); and (2) participation in any employee benefit plans of the Company. The Company does not have any right to control and direct Mr. Taff, not only as to the result to be accomplished by the services provided for herein, but also as to the details and means by which the result is accomplished. Mr. Taff acknowledges that he is waiving the right to participation in the Company’s benefit plans, including fringe benefit plans or other similar plans, and the right to any other benefit or item of compensation not expressly provided for herein that is provided to employees of the Company. Mr. Taff acknowledges that he will not be paid any “wages” (as defined in the Code) hereunder and that he shall be solely responsible for all taxes, including income and employment taxes, imposed on him by reason of any compensation, benefits or other amounts payable hereunder, and will report such compensation as earnings from self-employment. Mr. Taff shall not be subject to any established work schedule or routine or other supervision of or direction by B&W, as to hours worked or otherwise, notwithstanding that all the Services rendered hereunder shall be so rendered to the satisfaction of B&W and in compliance with applicable B&W policies and procedures. Notwithstanding any other provision in this Agreement, the retirement and other benefits that Mr. Taff may be entitled to as a result of his previous employment with B&W, including any benefits under the Restructuring Transaction Retention Agreement, shall continue in accordance with the terms and conditions of each respective benefit plan or other program.

3. Indemnity. Mr. Taff shall indemnify, defend and hold harmless the Company, its officers, directors, employees and agents, of and from all claims, suits, liabilities, damages or expenses relating to any liabilities incurred by the Company as a result of Mr. Taff’s failure to pay income and other taxes. For the avoidance of doubt, Mr. Taff shall have no obligation under the foregoing indemnity resulting from the failure of B&W to satisfy its own tax obligations.

4. Contact and Location. Mr. Taff shall take general direction from B&W’s Chief Executive Officer in connection with the Services. The parties agree that the Services are to be performed principally from B&W’s headquarters in Charlotte, North Carolina. During the Consulting Term, B&W will make available to Mr. Taff an office and staff personnel in Charlotte as Mr. Taff may require to perform his duties hereunder. Mr. Taff may perform some of the Services remotely from his home in Houston, Texas as long as the Services are being performed effectively, as reasonably determined by the Chief Executive Officer.

5. Compensation. During the Consulting Term, B&W agrees to pay Mr. Taff $112,629.00 per month, payable in two equal installments on the 15^th and last day of each month. Partial months will be prorated, however, the parties agree that the prorated payment for July 2011 will be included in the first payment paid in August 2011. In addition, B&W shall reimburse Mr. Taff any reasonable out-of-pocket business expenses incurred in connection with performing the Services during the Consulting Term (or thereafter in accordance with the last sentence of

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Section 1b), each within 30 days after Mr. Taff provides written documentation that such expenses have been incurred, but in no event will be paid later than March 15 of the calendar year following the calendar year in which such expenses were incurred. B&W further agrees to provide for Mr. Taff’s use in Charlotte during the Consulting Term: (1) a furnished apartment (not to exceed a cost of $3,200 per month, inclusive of utilities and housekeeping); and (2) a car (not to exceed a cost of $900 per month). Notwithstanding anything else herein to the contrary, B&W shall not pay or reimburse Mr. Taff for any more than two (2) round trip flights to or from Houston, Texas per month.

6. Non-Disclosure and Non-Solicitation. Mr. Taff acknowledges that he has previously received and, during the Consulting Term, will continue to receive new and different confidential and trade secret information which includes, but is not limited to any and all information, data and knowledge that has been created, discovered, developed or otherwise become known to the Company or in which property rights have been assigned or otherwise conveyed to the Company, which information, data or knowledge has commercial value in the business in which the Company or its ventures is engaged, including without limitation (a) information regarding plans for research, development, new products, marketing and selling, business plans, budgets and unpublished financial statements, suppliers and customers and (b) information regarding internal cost structure and allocation, pricing methodologies and bidding processes (collectively, “Confidential Information”). Confidential Information shall not include any information, data or knowledge that is or becomes generally known or available to the public without any breach of confidentiality by Mr. Taff or a third party. Mr. Taff agrees to maintain all Confidential Information in strict confidence and will not disclose or make available to any other person or entity, or use for any reason other than in the performance of the Services under this Agreement, any Confidential Information, except for such disclosures as may otherwise be required by law or legal process (in which case Mr. Taff, if legally permissible, shall notify B&W in writing of such legal or judicial proceeding as soon as practicable but prior to disclosure following his receipt of notice of such a proceeding, and permit B&W to seek to protect its interests and information at its sole cost and expense). For purposes of this Agreement, the term “Affiliate” means an Affiliate of B&W within the meaning of Rule 12b-2 promulgated under Section 12 of the Exchange Act. During the Consulting Term and for a period of one-year thereafter, Mr. Taff will not, whether on Mr. Taff’s own behalf or on behalf of or in conjunction with any other individual or entity, directly or indirectly: (1) solicit or encourage any employee of the Company to leave the employment of the Company; (2) hire any such employee who was employed by the Company as of the date of the termination of the Consulting Term or who left the employment of the Company coincident with, or within one-year prior to or after, the termination of the Consulting Term; or (3) directly or indirectly, solicit or encourage to cease to work with the Company any consultant then under contract with the Company.

7. B&W Property. All property and information, including, devices, records, data, notes, reports, findings, plans, proposals, lists, correspondence, specifications, drawings, blueprints, sketches, materials, equipment, customer or client lists or information, cost, pricing and bidding information, business plans or any other documents or property, in whatever medium stored (including all reproductions of the aforementioned items) obtained by Mr. Taff or developed in the course of or relating to the Services (the “Property”) shall be and remain the exclusive property of the Company. Mr. Taff agrees to deliver to B&W (and will not keep in his possession, recreate or deliver to anyone else) all Confidential Information and Property on the termination or expiration of this Agreement, or sooner if requested by B&W in writing. Mr. Taff

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shall take all requested actions and execute all requested documents (including any licenses or assignments required by a government contract) at the Company’s sole expense (but without further remuneration) to assist the Company in validating, maintaining, protecting, enforcing, perfecting, recording, patenting or registering any of the Company’s rights in the Property.

8. Term.

a. Mr. Taff shall provide the Services from July 31, 2011 through July 31, 2012, unless the Services are terminated earlier as set forth below in this Section 8 (“Consulting Term”). Notwithstanding the fact that the date to commence the Services is subsequent to the Effective Date of this Agreement, both B&W and Mr. Taff intend and agree that this Agreement shall be fully binding and in full force and effect from and after the Effective Date. Sections 1b through 3 and 6 through 11 shall survive any termination of the Consulting Term, the parties’ consulting relationship, and the termination or expiration of this Agreement.

b. B&W may terminate the Services and the Consulting Term for any reason upon thirty (30) days advance written notice to Mr. Taff.

c. Mr. Taff may terminate the Services and the Consulting Term for any reason on ninety (90) days’ advance written notice to B&W; provided that if B&W appoints another person as Chief Financial Officer, Mr. Taff may terminate the Services and the Consulting Term for any reason on sixty (60) days’ advance written notice to B&W.

d. Either party to this Agreement may terminate the Services and the Consulting Term immediately on written notice without further liability or obligation, except as otherwise specified herein, should the other party materially breach this Agreement.

9. Ethics and Compliance. Mr. Taff acknowledges that he has received B&W’s Code of Business Conduct, including related Company policies and procedures, and agrees to comply therewith. If B&W reasonably suspects a breach of its Code of Business Conduct, it reserves the right to investigate to determine whether a breach has occurred. During the investigation, B&W may withhold any payment due to Mr. Taff under this Agreement. B&W may terminate the Services and the Consulting Term without notice or liability if it determines, in its sole discretion, that Mr. Taff breached its Code of Business Conduct or has engaged in any course of conduct which has, or may reasonably be expected to have, the effect of demeaning the name or business reputation of the Company or affects adversely, or may reasonably be expected to affect adversely, the Company’s best interests, economic or otherwise.

10. Noncompetition and Conflict of Interest. During the Consulting Term, Mr. Taff shall not, directly or indirectly, without the prior written approval of the Company, act in any capacity for, be employed by, provide services to, or contract with any other company or entity engaged in Competing Services (a “Competitive Entity”), or acquire any interest of any type in any Competitive Entity; provided, however, that the foregoing shall not be deemed to prohibit Mr. Taff from acquiring, solely as an investment and through market purchases, securities of any Competitive Entity which are registered under Section 12(b) or 12(g) of the Exchange Act and which are publicly traded, so long as Mr. Taff is not part of any control group of such Competitive Entity and such securities, including converted securities, do not constitute more than one percent of the outstanding voting power of that entity. For the purposes of this

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Agreement, the phrase “Competing Services” shall mean any services that are the same as or similar to the services currently being provided or offered by the Company and/or which are provided or offered by the Company during the Consulting Term. Competing Services include but are not limited to the following: (a) power generation systems, including fossil-fired steam generating systems, replacement commercial nuclear steam generators, environmental equipment, replacement parts and related services; and (b) government operations, including supply of nuclear components to the U.S. Government and various services including uranium processing, environmental site restoration services and management and operating services for government-owned facilities. During the Consulting Term, Mr. Taff further agrees not to engage in any activity which might reasonably create a conflict of interest between himself and the Company or which might reasonably and adversely affect his judgment with respect to the business of the Company.

11. Miscellaneous.

a. Failure on the part of a party to insist on strict compliance by the other with any provision of this Agreement shall not constitute a waiver of obligations in respect thereof.

b. This Agreement sets forth the entire understanding of the parties with respect to the matters discussed herein and can be amended or extended only by written agreement signed by both parties.

c. This Agreement shall be binding upon and inure to the benefit of the parties hereto and their respective successors and permitted assigns. Neither party may assign its rights or obligations in and to this Agreement without the prior written consent of the other party, which consent may be given or withheld in the sole discretion of such party but may not be unreasonably delayed.

d. The obligations set forth in this Agreement are severable and divisible, and no clause or portion thereof that is not enforceable shall cause the remainder of such clause or other obligations contained herein to be unenforceable.

e. This Agreement shall be construed under and governed by the laws of the State of North Carolina, exclusive of its conflict of laws provisions.

f. Mr. Taff will, by virtue of his appointment as an officer of the Company, be entitled to the same rights to coverage under the directors and officers liability and insurance policies and indemnification under the Company’s Bylaws (or analogous governing documents) as are provided to the officers of the Company generally, and the Company shall take all reasonable steps necessary to give effect to this provision.

[SIGNATURES ON THE FOLLOWING PAGE]

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IN WITNESS WHEREOF, this Agreement has been duly executed by the parties as of the date first written above.

THE BABCOCK & WILCOX COMPANY		MICHAEL S. TAFF
/s/ Brandon C. Bethards		/s/ Michael S. Taff
By:	Brandon C. Bethards
Title:	President & Chief Executive Officer

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EX-99.1

Exhibit 99.1

Babcock & Wilcox Chief Financial Officer Exercises

Provisions of Retention Agreement

(CHARLOTTE, N.C. – July 1, 2011) – The Babcock & Wilcox Company (B&W) (NYSE: BWC) announced today that Michael S. Taff, Senior Vice President and Chief Financial Officer, has elected to exercise his right to terminate his employment under the provisions of a retention agreement dated December 10, 2009. Following the completion of the agreement’s one-year term that ends July 30, 2011, Mr. Taff will no longer serve as a full-time employee of the Company. To facilitate an orderly transition, the Company has negotiated a consulting agreement with Mr. Taff who will continue to perform the duties of Chief Financial Officer for a period not to exceed one year. During this time, the Company will conduct a comprehensive search for his replacement.

Brandon C. Bethards, President and Chief Executive Officer of B&W said, “Mike has been an important member of the executive team responsible for leading the spin transaction from McDermott and creating a significant amount of shareholder value in the process. Equally important, Mike has assembled a first-class financial executive team, bringing together experts in multiple disciplines from both inside and outside the Company. I want to personally thank Mike for his many contributions to the success of B&W and his ongoing contributions as the CFO during this transition period.”

“It has been both a challenging and rewarding process to help re-establish B&W as an independent publicly traded company,” Taff said. “I will remain fully engaged in the business as we continue to move forward with several important programs to drive significant growth for the Company. At the conclusion of my tenure, I am looking forward to returning to Houston and my family.”

Additional information can be found in a Form 8-K filed today with the Securities and Exchange Commission.

About The Babcock & Wilcox Company

Headquartered in Charlotte, N.C., The Babcock & Wilcox Company is a leader in clean energy technology and services, primarily for the nuclear, fossil and renewable power markets as well as a premier advanced technology and mission critical defense contractor. B&W has locations worldwide and employs approximately 12,000 people, in addition to approximately 10,000 joint venture employees. Learn more at www.babcock.com.

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Investor Contact:

Michael P. Dickerson

Vice President and Investor Relations Officer

The Babcock & Wilcox Company

704-625-4944 » investors@babcock.com

the babcock & wilcox company