The Board has affirmatively concluded that Mr. Arkley, Mr. Klein, Mr. Lieber, Mr. Oneglia, Ms. Reiss, Mr. Snyder and Judge Tevrizian qualify as independent directors under the independence standards established by Section 303A of the NYSE corporate governance rules. Mr. Tutor and Mr. Frost, both of whom are executive officers and employees of the Company, as well as Mr. Feltenstein, who is Mr. Tutor’s father-in-law, do not qualify as independent directors, and none of them serves on any committee that is reserved for independent directors. More detailedDetailed information about the Board’s determination of director independence is provided in the section of this proxy statement titled “Director Independence” section starting on page 78.



The principal occupation, business experience and educational background of each director nominee are set forth below:



Ronald N. Tutor has served as our Chief Executive Officer since March 2000, as Chairman of the Board since July 1999, and as a director since January 1997. Mr. Tutor also served as Chairman of the Board, President and Chief Executive Officer of Tutor-Saliba Corporation (“Tutor-Saliba”), a privately held California corporation engaged in the construction industry, until Tutor-Saliba merged with the Company in September 2008. He is a member of the Board of Trustees of the University of Southern California. With over 1920 years at the Company and over 5354 years in the industry, Mr. Tutor brings to our Board an industry acknowledged leadership role and in-depth knowledge of our Company and the construction industry. Mr. Tutor holds a Bachelor of Science degree in Finance from the University of Southern California.



Peter Arkley has served as a director since May 2000. Since June 2011, he has served as Senior Managing Director, Construction Services Group of Alliant Insurance Services, an insurance and bonding brokerage firm. From 1994 to 2008, he served as the Chairman/CEO of AON’s United States Construction Services Group, an insurance and bonding brokerage firm, and from 2008 until June 2011 he served as the Managing Principal/CEO of AON’s Global Construction Group. He is also a director of the Greater Los Angeles Zoo Association, a non-profit organization. Mr. Arkley has extensive knowledge and expertise in insurance surety and financial service markets. Mr. Arkley provides the Board insight on risk management and financial service matters. Mr. Arkley holds a Bachelor of Science degree in Finance from Wagner College.



Sidney J. Feltenstein has served as a director since November 2013 and is a Senior Operating Partner of Sentinel Capital Partners. He is the retired chairman and CEO of Yorkshire Global Restaurants, Inc., the holding company for A&W Restaurants and Long John Silver’s, which he founded in 1994. Prior to creating Yorkshire Global Restaurants, Mr. Feltenstein spent 19 years with Dunkin’ Donuts in both operations and marketing, the last 12 of which he spent as chief marketing officer. In 1992, he left Dunkin’ Donuts to become executive vice president of worldwide marketing for Burger King Corporation. Mr. Feltenstein serves on the board of directors of Wingstop Restaurants, Inc.,  a publicly held company, and is a member of their Audit Committee and Compensation Committee. Mr. Feltenstein also serves as a director of Fazoli’s, The HoneyBaked Ham Company, Focus Brands, Arby’s, Inc., Wingstop, Inc., Huddle

House, Inc., Checkers, Inc., and TGI Fridays, all of which are privately held companies. In addition, he is a former trusteeTrustee and Audit Committee chairman and is currently an Overseer of Boston University, and is a trusteeTrustee of The Health Store Foundation and One Family Health, all of which are non-profit organizations. Mr. Feltenstein is a past chairman of the International Franchise Association (IFA) and a former chairman of the IFA Educational Foundation. He is also a member of the IFA Hall of Fame and a past recipient of the IFA’s Entrepreneur of the Year Award. Mr. Feltenstein brings extensive operational and marketing management expertise to the Board through various positions held over his career and through his experience as a director of other public and private companies. Mr. Feltenstein holds a Bachelor of Arts degree in Communications from Boston University.



James A. (Jack) Frost has served as a director since February 2015, when he was promoted to the position of President and Chief Operating Officer. In addition, since 2008, Mr. Frost has served as CEO of Tutor Perini’s Civil Group. He originally joined the Company’s predecessor, Tutor-Saliba, in 1988 and quickly climbedwas ultimately elevated to the role of Chief Operating Officer. Prior to Tutor-Saliba, Mr. Frost founded and was the majority owner of his own general construction company, which he successfully operated for ten10 years. Earlier, heHe spent more than four years in active duty military service with the United States Air Force, during which time he trained and became certified as an expert in explosive ordnance management and disposal. He served multiple tours of duty in Southeast Asia and attended several schools and conducted assignments with the U.S. Navy, Marines and Army.Force. Mr. Frost studied engineering at the College of Southern Maryland, at Texas State University and at the University of Texas in Austin. He also completed a two-year business management program at the University of Phoenix in Woodland Hills, California. Over the course of his career, Mr. Frost has gained extensive executive leadership experience in construction management and operations, overseeing numerous projects, including many of the Company’s largest and most difficult building and civil projects. With 2829 years of experience with the Company, Mr. Frost provides to the Board with significant insight into the executive management and operational aspects of the Company.



Michael R. Klein has served as a director since January 1997 and as Vice Chairman of the Board since September 2000. He is considered an independent director, as defined by the NYSE, and he has been affirmedelected by the Board as the Lead Independent Director. Mr. Klein, serves as Chairman of the Board of Directors of CoStar Group, Inc., a publicly held provider of commercial real estate information of which he was a co-founder; as Chairman and CEO of the Sunlight Foundation and of Gun Violence Archive, both non-profit organizations which he founded; and as Chairman of the Shakespeare Theatre Company, a non-profit organization. Through 2009, he served as Chairman of the Board of Directors of Le Paradou, LLC, a privately held company, and through 2011 he served as the Lead Independent Director and Chairman of the Governance Committee of SRA International, Inc., a formerly publicly held provider of technology and strategic consulting services and solutions which was sold in June 2011, and as a director of ASTAR Air Cargo, Inc., a privately held company which was sold in 2014. He is a director of ThinkFood Group, LLC, a privately held food services company.company, a trustee of the Aspen Institute and Vice Chairman of the Aspen Music Festival and School, both non-profit organizations. From 1974 until 2005, Mr. Klein was a partner of the law firm Wilmer Cutler Pickering, now Wilmer Hale. Mr. Klein’s 40 plus years as a corporate lawyer, investor, and director of multiple corporations, both public and private, qualify and enable him to contribute sound judgment and leadership to the Company in his role as Lead Independent Director. Mr. Klein holds a Master of Laws degree from the Harvard Law School and Juris Doctor and Bachelor of Business Administration degrees from the University of Miami.



Robert C. Lieber has served as a director since August 2014. Mr. Lieber is Executive Managing Director of the Island Capital Group LLC and C-III Capital Partners LLC, which he joined in July 2010 after having served under New York City Mayor Michael R. Bloomberg as Deputy Mayor for Economic Development. Prior to joining the Bloomberg administration in January 2007, Mr. Lieber retired from Lehman Brothers after 23 years, serving most recently as a Managing Director in Lehman’s Real Estate Private Equity Group and prior to that as the Global Head of Real Estate Investment Banking. Mr. Lieber also serves as a Director of ACRE Realty Investors, a publicly traded real estate investment trust headquartered in Atlanta, Georgia. In September 2016, he was appointed as a director of Resource Innovation Office REIT, Inc., a public non-traded real estate investment trust (REIT), and was named the President and Chief Executive Officer of Resource Capital Corp., a publicly-traded REIT, each of which are managed by affiliates of Resource America, Inc., which is a wholly-owned subsidiary of C-III Capital Partners LLC. He also served as a Board member, Secretary of the Board and Trustee for the Urban Land Institute and is a former Chairman of the Zell-Lurie Real Estate Center at the Wharton School, University of Pennsylvania. Mr. Lieber brings extensive expertise and insight into financial and political matters pertaining to real estate and infrastructure development projects, gained through his experience in the financial and government sectors. Mr. Lieber holds a Bachelor of Arts degree from the University of Colorado and a Master of Business Administration degree from the Wharton School.

Dennis D. Oklak has been a director at Duke Realty Corporation, a publicly traded REIT focused on industrial and office properties, since 2004. Since 1986, Mr. Oklak held various senior executive positions at Duke Realty Corporation and most recently served as Chief Executive Officer from April 2004 through December 2015. He has served as Chairman of the Board of Directors of Duke Realty Corporation since 2005. Mr. Oklak has also served as a director of Xenia Hotels & Resorts, Inc., a publicly traded REIT focused on lodging properties, since 2015. Mr. Oklak brings real estate industry, finance, accounting, auditing, consulting, operations, development and executive leadership expertise. He holds a Bachelor of Science in Accounting from Ball State University.



Raymond R. Oneglia has served as a director since March 2000. Since 1997, he has also served as Vice Chairman of the Board of Directors of O&G Industries, Inc. (“O&G”), a Connecticut corporation engaged in the construction industry, and prior to that, served in various operating and administrative capacities with O&G since 1970. Mr. Oneglia’s 4647 years of experience at O&G allows him to contribute an in-depth industry perspective. Mr. Oneglia holds a Bachelor of Science degree from Union College.



Dale A. Reiss has served as a director since May 2014. She currently serves as senior managing directorSenior Managing Director of Brock Capital Group LLC and chairman of Brock Real Estate LLC, its equity and mezzanine financing arm, as well as managing director of Artemis Advisors, LLC.arm. Ms. Reiss is a director of iStar Financial Inc., a real estate finance company, where she is chairperson of the Audit Committee, of CYS Investments, Inc., where she is a member of the Audit and Nominating and Governance Committees and of Care Capital Properties Inc., a healthcare REIT, where she is Chair of the Compensation Committee and a member of the Nominating and Nominating/Governance and Executive Committees. Until her retirement in 2008, she served as Senior Partner as well as Global and America’s director of real estate, hospitality and construction at Ernst & Young LLP and was a senior partner there from 1995 through 2008. She was subsequently senior consultant to thetheir Global Real Estate Center of Ernst & Young LLP from 2008 to 2011. She served as a managing partner at Kenneth Leventhal & Company from 1985 through its merger with Ernst & Young in 1995. From 1980 to 1985, Ms. Reiss was a senior vice president and controller at Urban Investment & Development Company. Since 1998, Ms. Reiss has served as a governor and past trusteeTrustee of Urban Land Institute, and in various Urban Land Institute officer and committee leadership positions. She also serves on the boardBoard of directorsDirectors of the Guttmacher Institute. She is a former member of the boardBoard of directorsDirectors of Post Properties, Inc., where she served on the Audit Committee, and of the Pension Real Estate Association. Ms. Reiss brings extensive expertise in financial and accounting matters from her experience over an extended period at several major public accounting firms, her leadership experience in management and operations at those firms, and her experience as a director of other public and private companies. Ms. Reiss holds a Bachelor of Science degree in Economics and Accounting from the Illinois Institute of Technology and a Master of Business Administration degree from the University of Chicago. She is a Certified Public Accountant.



Donald D. Snyder has served as a director since 2008. He was a director and the president of Boyd Gaming Corporation from 1997 until his retirement in 2005. Following service from 2010 as dean of the Harrah College of Hotel Administration at the University of Nevada, Las Vegas (“UNLV”), Mr. Snyder was named Acting President of UNLV in February 2014. Since January 2015, he has served as Presidential Advisor at UNLV. He also serves as a member of the nominating and governance (chair) and the risk management committees of Western Alliance Bancorporation, a publicly held commercial bank holding company, as well as serving as a member of the board of directors of its lead bank, Western Alliance Bank (formerly Bank of Nevada), and as a director and member of the compensation and governance (chair), and audit committees of Switch, LLC, a privately held technology company. He is presently on the Board of Directors of non-profit entities, including The Smith Center for the Performing Arts (Chairman) and the Nathan Adelson Hospice. Mr. Snyder’s role as a public gaming company executive, his experience in commercial banking (former Chairman & CEO of First Interstate Bank of Nevada), and his experience on several public, private and non-profit boards provides the Board comprehensive insight on financial and business matters. Mr. Snyder holds a Bachelor of Science degree in Business Administration from the University of Wyoming.



Dickran M. Tevrizian, Jr. has served as a director since September 2011. Prior to his retirement in April 2007, Mr. Tevrizian washad been a federal judge for the United States District Court for the Central District of California since 1986, and earlier served from 1972 to 1982 as a Municipal and then as a Superior Court judge for the State of California. From 1999 to 2007, Judge Tevrizian also served as an Advisory Director to the University of California, Los Angeles School of Public Policy. Upon retirement from the federal judiciary, Judge Tevrizian assumed the role of a private mediator/arbitrator with Judicial Arbitration and Mediation Services. Judge Tevrizian also serves on the boards of the Children’s Hospital of Los Angeles, the legal advisory board of Legal Zoom, Inc. and several other privately held companies and corporations. He is also a trusteeTrustee of Pacific Oaks College. Judge Tevrizian’s 31 plus years of experience as a federal and state judge provides the Board with significant insight on risk management and compliance matters. Mr. Tevrizian holds a Juris Doctor degree and a Bachelor of Science degree in Finance from the University of Southern California.



Our Corporate Governance and Nominating Committee has recommended each of the above listed individuals for re-election or election as directors. Unless otherwise noted thereon, proxies solicited hereby will be voted for the election of the director nominees to hold office until the 20172018 Annual Meeting of Shareholders and until their successors are chosen and qualified. Each nominee has consented to being named in this proxy statement and, if elected, each nominee has consented to serve as a director until his or her successor is duly elected and qualified. The Board does not contemplate that any nominee will be unable to serve as a director for any reason, but if that should occur prior to the meeting, proxies solicited hereby may be voted either for a substitute nominee designated

by the Board or recommended by the Corporate Governance and Nominating Committee, or the Board may determine to leave any such Board seat vacant until a suitable candidate is identified, or to reduce the size of the Board.



Board Recommendation

THE TUTOR PERINI BOARD OF DIRECTORS UNANIMOUSLY RECOMMENDS A VOTE “FOR” EACH OF THE BOARD OF DIRECTORS’ NOMINEES FOR RE-ELECTION OR ELECTION AS DIRECTOR.



INFORMATION ABOUT THE BOARD OF DIRECTORS



Board Composition



The Board currently consists of 11 directors, all of whose terms expire upon the election of their successors at the 20162017 Annual Meeting. The most recent additionsaddition to the Board include Robertwas Thomas C. Lieber,Leppert, who was elected to the Board by a vote of the directors in August 2014, and was subsequently re-elected by a voteMarch 2017. In addition to the 11 current directors, the Board is nominating an additional director, Dennis D. Oklak. The Board has approved an increase to the size of the shareholders at the 2015 Annual Meeting. Earlier, Dale A. Reiss was electedBoard, from 11 to the Board by a vote of the Company’s shareholders at the 2014 Annual Meeting of Shareholders, and was also subsequently re-elected by a vote of the shareholders at the 2015 Annual Meeting. Sidney J. Feltenstein was originally appointed12 members, contingent upon Mr. Oklak’s election to the Board in November 2013, and was subsequently re-elected by a vote of the shareholders at the 2014 Annual Meeting. Mr. Feltenstein was originally nominated by Mr. Tutor pursuant to his rights under a shareholder agreement by and among the Company and certain of its shareholders dated April 2, 2008, as amended on September 17, 2010, June 2, 2011, September 13, 2011 and March 20, 2013 (the “Amended Shareholders Agreement”), as discussed below. Mr. Feltenstein is Mr. Tutor’s father-in-law. The Corporate Governance and Nominating Committee reviewed Mr. Feltenstein’s qualifications and his appointment to the Board was unanimously approved by the Board.



Under the Amended Shareholders Agreement, which became effective upon the September 2008 merger between Perini Corp. and Tutor-Saliba, Mr. Tutor (as the representative of the former Tutor-Saliba shareholders) has the right to designate one nominee for election as a member of the Board (and thereafter, for nomination for election), so long as Mr. Tutor and three trusts he controls (the “Tutor Group”) own at least 11.25% of the outstanding shares of the Company’s Common Stock. For more information, see “Amended“Certain Relationships and Related Party Transactions—Amended Shareholders Agreement” starting on page 40.

As of the date of this proxy statement and as also discussed above,Agreement.” Mr. Tutor elected to exercise his right to designate one nominee to the Board in November 2013, when he designated Mr. Feltenstein for nomination and election to the Board. The Corporate Governance and Nominating Committee reviewed Mr. Feltenstein’s qualifications and his appointment to the Board was unanimously approved by the Board.



Director Independence



The Board assesses its directors’ independence from the Company annually, pursuant to Section 303A of the NYSE Listing Standard. As of its most recent assessment, the Board has reviewedaffirmatively determined that the independence of directors for 2015 and has concluded that Ms. Alexander,following Board members are independent directors: Mr. Arkley, Mr. Klein, Mr. Leppert, Mr. Lieber, Mr. Oneglia, Ms. Reiss, Mr. Snyder Ms. Reiss, and Judge Tevrizian, are “independent” in accordanceTevrizian. The Board has also affirmatively determined that Mr. Oklak will be an independent director if elected by shareholders. In making its determination of independence, the Board considered each director’s relationship with the independence standards establishedCompany and its management. Regarding the Compensation Committee, the Board considered all sources of compensation paid to the directors by Section 303Athe Company, as well as whether the director is affiliated with the Company or any of the NYSE rules. In determining independence pursuant to NYSE standards, after an initialCompany’s subsidiaries or affiliates. The Board also broadly considered all relevant facts and circumstances when assessing the materiality of each of the Director’s relationships with the Company. The Board considered a broad range of possible relationships, including, among others, commercial, industry, banking, consulting, legal, accounting, charitable and familial.

As part of its review, by the Corporate Governance and Nominating Committee, each year the Board makes an affirmative determinationconsidered Mr. Arkley’s and Mr. Oneglia’s business relationships with the Company, and concluded that those relationships were not material and,  therefore, both individuals are independent. A summary of the Board’s analysis follows:  

With respect to Mr. Arkley, the Board considered the relationship between the Company and Alliant Insurance Services (“Alliant”), of which Mr. Arkley is currently a Senior Managing Director. In addition, the Board considered Mr. Arkley’s role on the Compensation Committee in assessing whether directors have a directcompensation to Mr. Arkley paid by any person or indirect materialentity had or would impair his ability to make independent judgments about the Company’s named executive officers.  Consistent with NYSE Listing Standard 303A.02(a), the Board determined that the Company’s relationship with Tutor Perini, including its subsidiaries, that may interfere with their ability to exercise theirAlliant did not impact Mr. Arkley’s independence from Tutor Perini.Perini because of the following: (1) services provided by Alliant are supplied to Tutor Perini on terms similar to Alliant’s other clients; (2) income generated by Alliant for services provided to Tutor Perini are not material to Alliant’s U.S. or consolidated operations; (3) Mr. Arkley is not personally involved in the management of Alliant’s services provided to the Company; (4) Mr. Arkley recuses himself on all Board decisions regarding insurance; (5) Mr. Arkley does not have the authority to unilaterally negotiate Alliant’s fees charged to the Company; (6) commissions paid by the Company are established by arrangements negotiated between Alliant and insurance carriers, are applied to all of Alliant’s customers, indiscriminately, and are publicly disclosed; and (7) remuneration paid to Mr. Arkley for his role at Alliant is not directly tied to the Company’s use of Alliant’s services.



In evaluating theAdditionally, in determining Mr. Arkley’s independence, of each non-employee director, the Board considered, several factors. as it does for all of its directors, the qualitative and quantitative factors in NYSE Listing Standard 303A.02(b) and noted that none of these factors impacted Mr. Arkley’s independence.

i.whether the director was employed by the company in the last three years or has a family member who was an executive officer of the company in the last three years;

ii.whether the director or a family member accepted compensation from the company in excess of $120,000 during any 12 consecutive months in the last three years, other than remuneration for services provided as a director;

iii.whether the director or a family member is a partner at the company’s auditor, or was an employee of the auditor and worked on the company’s audit in the last three years, or the director is an employee of the auditor, or a family member is an employee of the auditor and works on the company’s audit;

iv.whether the director or a family member is or has been in the last three years an executive officer of another entity where any executive officer served on the compensation committee at the same time; and

v.whether the Company made or received payments in the last three years in excess of the greater of 2% of the counterparty’s gross revenue and $1 million to an organization where a director is an employee or has a family member that is an executive officer.

Finally, the Board considered other qualitative factors, including those that could result in only the appearance of a lack of independence, and concluded that Mr. Arkley is independent in both fact and appearance.

With respect to Mr. Oneglia, the Board considered the relationship during 2016 between O&G, of which Mr. Oneglia is Vice Chairman of the Board of Directors and a shareholder, and Tutor Perini, including the construction joint ventures between Tutor Perini and O&G. The Board determined that the existing joint ventures didventure arrangements do not impact Mr. Oneglia’s independence from Tutor Perini management because:because of the following: (1) the joint ventures are formed for the limited purposes of performing specific contractual requirements for owners as is commonplace in the construction business,business; (2) Mr. Oneglia recuses himself on all Board decisions related to the joint ventures between the Company and O&G,&G; (3) Mr. Oneglia is not personally involved in the management of these joint venturesventures; and (4) Tutor PeriniMr. Oneglia does not have the authority to unilaterally negotiate and approve the terms of the joint venture arrangements. In addition, the Audit Committee or the full Board has, in each instance of a proposed joint venture, assured itself that the joint venture is on terms no more favorable to O&G than have an equal votebeen the terms of other joint ventures in which the governance of such joint ventures. With respect to Mr. Arkley,Company has participated. Finally, the Board considered the relationship between Alliant Insurance Services (“Alliant”) during 2015, of whichqualitative and quantitative factors pursuant to NYSE Listing Standard 303A.02, outlined above regarding Mr. Arkley, is currently Senior Managing Director, Construction Services Group, and Tutor Perini, an insurance and bonding client of Alliant. The Board has determined that his independence from Tutor Perini management is notnone of these factors impacted because: (1) services provided by Alliant are supplied to Tutor Perini on terms similar to Alliant’s other clientsMr. Oneglia’s independence.

Note that with the election of two new directors and (2) income generated by Alliant for services provided to Tutor Perini are not material to Alliant’s U.S. or consolidated operations. Specifically with regardresulting committee reassignments, both Mr. Arkley and Mr. Oneglia will transition to the income generated by Alliant,Corporate Governance and Nominating Committee in 2017 from the Board also consideredCompensation Committee and the independence testing as defined in the NYSE Listing

Standard 303A.02(b)(v), which states that a director is not independent if the director is a current employee of a company that has made payments to or received payments from Tutor Perini in an amount which, in any of the last three fiscal years exceeds the greater of $1 million or 2% of such other company’s consolidated gross revenues. During the years 2013, 2014 and 2015, Tutor Perini paid fees to Alliant which were less than 2% of Alliant’s consolidated gross revenues in each respective year. No other independent directors had material relationships with Tutor Perini other than in their capacities as directors.

Messrs.Mr. Tutor and Mr. Frost who are both executive officers and employees of Tutor Perini, as well asthe Company,  and Mr. Feltenstein who is Mr. Tutor’s father-in-law, do not qualify as independent directors, andfather-in-law. Accordingly, none of them serves on any committee that iscommittees reserved for independent directors.



Communications with the Board



The Board welcomes the submission of any comments or concerns from shareholders, employees and other interested parties. Any shareholder, employee or interested partyThose who wisheswish to communicate with the Board may submit such communicationcommunications in writing to Tutor Perini Corporation, 15901 Olden Street, Sylmar, California 91342 and marked to the attention of the Board of Directors or any of its committees or individual directors. All comments or concerns from shareholders and other interested parties will be forwarded directly to the appropriate Board committee or specific directors, as well as to the Company’s Compliance Officer.



In order to facilitate communications with the independent directors, we have a secure telephone number (800-489-8689) whereby shareholders, employees and other interested parties may be able to make their concerns known directly and confidentially to the non-employee directors, the Audit Committee or the Corporate Governance and Nominating Committee. Shareholders and other interested parties can also communicate with the independent directors via email at board@tutorperini.com. The designated recipients of these reports will not filter the communications.



CORPORATE GOVERNANCE



Board Leadership



Mr. Tutor is the Chairman of the Board and Chief Executive Officer. The Chairman of the Board and Chief Executive Officer positions are separately designated offices of the Company, as defined in the Company’s by-laws. However, these offices may be held by the same person. Mr. Tutor’s Employment Agreement stipulates that he shall serve as the Company’s Chief Executive Officer, as a member of the Board of Directors and as Chairman of the Board. Furthermore, the Board has evaluated these positions and determined that Mr. Tutor’s continued participation in both positions is important to the continued success of the Company because of:for the following reasons, among others: (i) his iconic role in the construction industry with a proven past in the successfulrecord of successfully bidding for and managing of large, complex building and civil projects,projects; (ii) his strong industrybusiness relationships, including those with ourclients, suppliers, subcontractors and surety and insurance partners,partners; and (iii) his lengthy history of business acumen, strategic sense, discipline and strategic acquisitions,sound judgment, which have significantly increased the Company’s competitiveness throughresulted in growth and vertical integration ofwhile positioning the Company’s services and an expanded nationwide footprint, including a strong presence in the New York and east coast construction markets.Company for future success with unprecedented infrastructure spending expected.

Mr. Klein is an independent (non-employee) director and the Lead Independent Director elected as affirmedsuch by a majorityunanimous vote of the independent directors. AsFor more information regarding Mr. Klein’s duties and authority as Lead Independent Director, Mr. Klein has the duties and authority outlined starting on page 11 undersee “Corporate Governance and Nominating Committee.”



Committees and Meetings of the Board of Directors



TheDuring 2016, the Board met sixseven times, during 2015. During 2015,and each of our directors attended at least 75% of: (i)of the total number of meetings of the Board and (ii) the total number of meetings held by all committees on which such director served, with the exception of Mr. Frost, who did not attend two meetings, one of which was missed for medical reasons. With regard to the meetings missed, Mr. Frost was actively engaged with management and the directors regarding the topics discussed.served. The members of the Board are encouraged to attend our annual shareholders meetings. All 1110 of the currentthen-current directors attended the 20152016 Annual Meeting of Shareholders.



Our by-laws authorize the Board to appoint one or more committees, each consisting of one or more directors. The Board currently has three standing committees: an Audit Committee, a Corporate Governance and Nominating Committee and a Compensation Committee. Each of the committees of our Board has a charter, which satisfies the requirements of the corporate governance rules issued by the SEC and the NYSE for each respective committee. Each Committeecommittee reviews its charter annually and revises it as appropriate. We maintain copies of the charters of each of the committees of our Board in the “Corporate Governance” section of our website at www.tutorperini.com and provide copies in print, without charge, to any shareholder who requestsrequesting a copy.



The Board’s Role in Risk Oversight



Our management is responsible for day-to-day risk management. This oversight includes identifying, evaluating and addressing potential risks that may exist at the enterprise, strategic, financial, operational, compliance and reporting levels. Periodically, and at least quarterly, the Board meets with management to discuss key risks to our operations and our strategy, as well as risk mitigation plans and activities. The Board plays an integral role in providing risk oversight on potential related party transactions and any transactions outside of the normal course of our operations. Our Board administers its risk oversight function as a whole and through its Board committees. For example, the Audit Committee regularly discusses with management certain risk exposures, their potential financial impact on our company and our risk mitigation strategies. In addition, each of the other standing Board committees (the Compensation Committee and the Corporate Governance and Nominating Committee) regularly meets to discuss the short-termshort- and long-term risk mitigation objectives and to provide oversight for risks relating to the applicable committee’s areas of responsibility. The Compensation Committee, with management’s assistance, reviews the compensation plans and programs throughout the Company to confirm that these plans do not encourage excessive risk-taking that may have a materially adverse effect on the Company.



Since Mr. Tutor serves as both CEO and Chairman of the Board, having a Lead Independent Director in place, as discussed above, helps to ensure that the Board is fulfilling its role in risk oversight.



Nominations for Director



The Board seeksconsiders candidates who are independent, possess relevant business, professional or board experience to make a significant contribution to the Board and have sufficient availability to attend to the business of the Company. Annually, the Corporate Governance and Nominating Committee conducts an evaluation of the Board to determine whether it is functioning effectively and recommends to the full Board the slate of director-nominees to be nominated for election at the next annual meeting of shareholders. Potential candidates for the Board may include candidates nominated by shareholders in accordance with our by-laws, those identified by a search firm retained for such purpose or candidates recommended by other persons, including current directors or executive officers. Pursuant to the Corporate Governance and Nominating Committee charter, the process and criteria for considering the recommendations of shareholders with respect to candidates for election to the Board is the same as those used for candidates recommended by other parties. The minimum qualifications and specific qualities and skills required for directors are set forth in the Corporate Governance Guidelines, a copy of which is maintained in the “Corporate Governance” section of our website at www.tutorperini.com. The Corporate Governance and Nominating Committee considers the diversity in skill and experience of each nominee when evaluating candidates individually and when considered with all directors as a group.



A shareholder who wishes to recommend a director-nominee to the Corporate Governance and Nominating Committee for the 20172018 Annual Meeting of Shareholders should submit the recommendation in writing to Tutor Perini Corporation, 15901 Olden Street, Sylmar, California 91342, Attention: Corporate Secretary, so it is received not less than 75 days nor more than 180 days prior to the anniversary date of the 20162017 Tutor Perini Annual Meeting of Shareholders. However, if the 20172018 Annual Meeting of Shareholders is

held more than seven (7) days earlier than the anniversary date of the 20162017 Annual Meeting of Shareholders, then notice must be delivered or received no later than 5:00 p.m. Pacific Daylight Time on (a) the 20th day following the earlier of:of (i) the day on which such notice of the date of the annual meeting is mailed or (ii) the day on which public disclosure of the date of the annual meeting is made, or (b) if such date of notice or public disclosure occurs more than 75 days prior to the scheduled date of such meeting, then the later of:of (i) the 20th day following the first to occur of such notice or such public disclosure or (ii) the 75th day prior to such scheduled date of such meeting.



Such shareholder notice shall set forth (a) as to each person whom the shareholder proposes to nominate for election as a director (i) the name, age, business address and residence address of such person, (ii) the principal occupation or employment of such person for the past five years and (iii) the class and number of shares of the corporation’s capital stock that are beneficially owned by such person on the date of such shareholder notice and (b) as to the shareholder giving the notice (i) the name and address, as they appear on the Company’s stock transfer books, of such shareholder and of the beneficial owners (if any) of the stock registered in such shareholder’s name and the name and address of other shareholders known by such shareholder to be supporting such nominees on the date of such shareholder’s notice and (ii) the class and number of shares of the corporation’s capital stock that are beneficially owned by such shareholder and such beneficial owners (if any) on the date of such shareholder notice and by any other shareholders known by such shareholder to be supporting such nominees on the date of such shareholder notice.

Audit Committee



TheDuring 2016, the Audit Committee currently consistsconsisted of Dale A. Reiss (Chair), Marilyn A. Alexander, Michael R. Klein, Robert C. Lieber and Raymond R. Oneglia. Each of the membersThe Board has determined that each member of the Audit Committee is “financially literate,” as defined in the NYSE listing standards, and meets the independence and experience requirements for members of an audit committee set forth in the rules of the SEC and the listing standards of the NYSE, as affirmed by the Board.NYSE. Based upon review of their qualifications, the Board has designated Ms. Reiss, and Ms. AlexanderMr. Klein and Mr. KleinLieber as the Company’s “audit committee“Audit Committee financial experts” as defined by the rules of the SEC. If elected, the proposed new director, Dennis D. Oklak, will serve on the Audit Committee and has been determined by the Board to qualify as an “Audit Committee financial expert.” As previously noted, Mr. Oneglia will transition from the Audit Committee to the Corporate Governance and Nominating Committee. None of the Audit Committee members serve on the audit committees of more than two other public companies.



The Audit Committee has the authority to retain special accounting, legal accounting or other consultants, as deemed necessary. The Audit Committee met eight times during 2015. Ms. Alexander has notified the Board that she will not be standing for re-election at the 2016 Annual Meeting due to personal reasons.2016.



REPORT OF THE AUDIT COMMITTEE



The Audit Committee (the “Committee”) oversees the financial reporting process of Tutor Perini Corporation (the “Company”), on behalf of the Board of Directors (the “Board”) of the Company in accordance with the Audit Committee charter. The Board, in its judgment, has determined that all members of the Committee meet the independence and experience requirements of the Securities and Exchange Commission (the “SEC”) and the New York Stock Exchange (the “NYSE”). The Board has designated Marilyn A. Alexander, Michael R. Klein, Robert C. Lieber and Dale A. Reiss (Chair) as the Company’s “Audit Committee financial experts,” as defined by the rules of the SEC and NYSE, based on review of their qualifications.



The Company's management is responsible for the financial reporting process and preparation of the quarterly and annual consolidated financial statements, including maintaining a system of internal controls over financial reporting, as well as disclosure controls and procedures. In fulfilling its oversight responsibilities, the Committee meets with its independent auditor (Deloitte & Touche LLP, or “Deloitte,” an independent registered public accounting firm), internal audit and management to review accounting, auditing, internal controls and financial reporting matters. The Committee is directly responsible for the appointment, compensation, retention, oversight and termination of the Company's independent auditor.auditors (Deloitte & Touche LLP, or “Deloitte,” an independent registered public accounting firm). The independent auditorCommittee is also responsible for the oversight of the Company’s internal audit function. In fulfilling its oversight responsibilities, the Committee meets with Deloitte, internal audit and management to review accounting, auditing, internal controls and financial reporting matters. Deloitte audits the effectiveness of the Company's internal controls over financial reporting and expresses its opinion thereon, in addition to auditing the annual consolidated financial statements and expressing an opinion whether those financial statements present fairly the financial position, results of operations and cash flows of the Company in the conformity with accounting principles generally accepted accounting principles in the United States.States of America.

The Committee has adopted pre-approval policies and procedures for certain audit and non-audit services and evaluated whether those pre-approved services that Deloitte provides are consistent with the SEC’s rules and regulations on auditor independence. The Committee has the authority to engage outside legal counsel and others to obtain advice and assistance as deemed necessary.



In connection with the December 31, 20152016 audited consolidated financial statements, the Committee:











Based on the reviews and discussions above, the Committee recommended to the Board that the audited consolidated financial statements for 20152016 be included in the Company's Annual Report on Form 10-K for the year ended December 31, 20152016 for filing with the SEC. The Committee also recommended to the Board the reappointment of Deloitte, as the independent auditors of the Company for 2017. The Board approved both recommendations made by the Committee’s recommendation.Committee and resolved to include Deloitte’s reappointment to the Company’s shareholders for ratification at the 2017 Annual Meeting. 





Corporate Governance and Nominating Committee



TheDuring 2016, the Corporate Governance and Nominating Committee consistsconsisted of Michael R. Klein (Chair), Robert C. Lieber, Donald D. Snyder and Dickran M. Tevrizian, Jr. EachThe Board has determined that each member of the Corporate Governance and Nominating Committee is an independent director, as defined by the NYSENYSE. As previously mentioned,  Peter Arkley and as affirmed byRaymond R. Oneglia, also independent directors, will join the Board.Corporate Governance and Nominating Committee in 2017.  The duties of the Corporate Governance and Nominating Committee include:include the following:















The Corporate Governance and Nominating Committee has the authority to retain consultants or other experts as it considers necessary to assist in the performance of its duties. During 2015,2016, the Corporate Governance and Nominating Committee did not retain any consultants or other experts. The Corporate Governance and Nominating Committee met fivefour times during 2015.2016.



The independent directors have designated Michael R. Klein, chair of the Corporate Governance and Nominating Committee, to act as the “LeadLead Independent Director.” In his capacity as Lead Independent Director, Mr. Klein has the following duties and authority:















We have developed Corporate Governance Guidelines and a Code of Business Conduct and Ethics to outline our commitment to carefully govern the operation of our business and compliance with applicable laws and regulations, while maintaining the highest ethical standards. The Code applies to all of our officers, directors and employees, including our principal executive officer, principal financial officer, principal accounting officer and persons performing similar functions. Tutor Perini’s Corporate Governance Guidelines and its Code of Business Conduct and Ethics are also available in the “Corporate Governance” section of our website at www.tutorperini.com. Interested parties may obtain printed copies of these documents by writing to or calling the Investor Relations Department of the Company at 15901 Olden Street, Sylmar, California 91342; Telephone: (818) 362-8391; E‑Mail: investor.relations@tutorperini.com. Any amendments to, or waivers of, the Code of Business Conduct and Ethics that apply to our directors, Chief Executive Officer, President, Chief Financial Officer or any person performing similar functions will be disclosed on our website promptly following the date of such amendment or waiver.



Compensation Committee



TheDuring 2016, the Compensation Committee consistsconsisted of Donald D. Snyder (Chair), Peter Arkley and Michael R. Klein. EachAs previously discussed, Mr. Arkley will be replaced on the Compensation Committee by Thomas C. Leppert and will now become a member of the Corporate Governance and Nominating Committee. The Board has determined that each member of the Compensation Committee is an independent director, as defined by the NYSE, and as affirmed bymeets the Board.additional independence requirements of the NYSE applicable to Compensation Committee members.



The principal powers and duties of the Compensation Committee as established by the Board are to:as follows:















The Compensation Committee has the authority to retain special consultants to advise the Committee as it considers necessary. These consultants report exclusively to the Compensation Committee, which has sole discretion to hire and fire the consultants and to approve the consultants’their fees. The Compensation Committee in 2015 retained the services of Meridian Compensation Partners, LLC (“Meridian”) in 2017 to review and provide guidance onfor the 20152017 proxy statement and to provide other consultative services related to our compensation programprograms and practices. In addition, during 2015,2016 and 2017, the Compensation Committee consulted Kirkland & Ellis LLP (“K&E”), on certain legal aspects of executive compensation, including our employment and compensation arrangements with our CEO and other executive officers, the design of performance goals pursuant toand our 2015 incentive compensation program foradvisory vote proposal on our executive officers, and our Say-on-Pay Proposal.compensation. K&E also advises the Company regarding executive compensation matters, including executive compensation practicesgeneral corporate, strategic and contractual matters, as well as regarding our equity compensation plans and other executive and employee plans.capital markets matters. The Compensation Committee considered independence factors under the Dodd-Frank Wall Street Reform and Consumer Protection Act (the “Dodd-Frank Act”) and NYSE rules and concluded that the work performed by Meridian and K&E did not give rise to any conflicts of interest.



The Compensation Committee met eightfour times during 2015.2016.



REPORT OF THE COMPENSATION COMMITTEE



The Compensation Committee has reviewed and discussed the Compensation Discussion and Analysis (“CD&A”) contained in this proxy statement with management. Based on the aforementioned review and discussion, the Compensation Committee has recommended to the Board, and the Board has approved, that the CD&A be included in the Company’s 20162017 proxy statement for filing with the SEC.



CERTAIN RELATIONSHIPS AND RELATED PARTY TRANSACTIONS

We have adopted a Code of Business Conduct and Ethics for all executive officers, directors, and employees, which addresses potential conflict of interest situations, including related party transactions. Under this Code of Business Conduct and Ethics, any questions involving potential conflict of interest situations are required to be directed to our Chief Compliance Officer, and suspected violations are required to be reported to either the Chief Compliance Officer or the Chair of the Audit Committee. In addition, our Audit Committee is responsible for reviewing and evaluating potential transactions with related parties and then advising the Board whether such transactions are appropriate.

The transactions described below were reviewed and approved by the Audit Committee or the full Board, as applicable, in accordance with our policies involving potential conflict of interest situations.

Amended Shareholders Agreement

Effective September 8, 2008 upon completion of the merger with Tutor-Saliba, we entered into a shareholders agreement (as subsequently amended, the “Amended Shareholders Agreement”) with Mr. Tutor, as the shareholder representative, and each of the former Tutor-Saliba shareholders who became shareholders of Tutor Perini, which provides for the following:

Mr. Tutor will be nominated for election to the Board as long as he serves as the Chief Executive Officer of Tutor Perini.

Mr. Tutor has the right to designate two nominees for election to the Board for so long as the Tutor Group owns at least 22.5% of the outstanding shares of Common Stock and one nominee if the Tutor Group owns less than 22.5% but more than 11.25% of the outstanding shares of Common Stock. Mr. Tutor elected to exercise his right to designate one nominee to the Board when, in November 2013, he designated Mr. Feltenstein for nomination and election to the Board. Accordingly, at each meeting of shareholders at which directors are to be elected, we have agreed to nominate and recommend the shareholder representative’s designee(s) and Mr. Tutor (as long as he serves as our Chief Executive Officer) for election to the Board, subject to certain limitations to comply with law, governance requirements or eligibility for listing on a securities exchange or if a nominee is deemed to be unfit to serve as a director of an NYSE-listed company or otherwise does not meet applicable eligibility criteria.

The Tutor Group (see “Board Composition” for discussion of the Tutor Group) has certain registration rights with respect to the shares of the Common Stock acquired pursuant to the merger. After March 8, 2009, Mr. Tutor, as shareholder representative, may require Tutor Perini, on up to three occasions, to register shares of Common Stock issued to the Tutor Group in connection with the merger for resale under the Securities Act in an underwritten offering. Additionally, if we propose to register any securities under the Securities Act, each member of the Tutor Group must receive notice of the registration and the opportunity to include its shares of the Common Stock in the registration. These “piggyback registration” rights are subject to customary conditions and limitations, including the right of the underwriters of an offering to limit the number of shares included in such registration and Tutor Perini’s right to decline a request to register shares. Tutor Perini is responsible for paying the expenses of any such registration.

Leased Property

We lease certain facilities from an entity owned by Mr. Tutor at market lease rates. Under these leases we paid $2.8 million and recognized expense of $3.2 million for the year ended December 31, 2016. Our participation in these lease agreements was reviewed and approved by the Audit Committee in accordance with the Company’s Code of Business Conduct and Ethics.

O&G Joint Ventures

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Mr. Oneglia is Vice Chairman of O&G Industries, Inc. (“O&G”). The Company occasionally forms construction project joint ventures with O&G, and O&G often provides equipment and services for the projects on customary trade terms. We currently have two joint ventures with O&G for infrastructure projects in the northeastern United States that are 99% and 100% complete. In addition, we have a 75% interest in a  newly formed joint venture with O&G (as the 25% interest holder) for a project in Los Angeles, California that has not yet commenced significant operations. Immaterial payments (totaling less than $8 million) were made to O&G by the joint ventures, not the Company, during 2016. Our participation in these joint ventures was reviewed and approved by the Audit Committee or the full Board in accordance with the Company’s policies.  See “Director Independence” for additional information.

COMPENSATION COMMITTEE INTERLOCKS AND INSIDER PARTICIPATION

No member of the Compensation Committee has served as one of our officers or employees at any time. None of our executive officers currently serves, or in the past year has served, as a member of the board or compensation committee of any entity that has one or more executive officers serving on our Board or Compensation Committee. No member of the Compensation Committee had any relationship requiring disclosure under Item 404 of Regulation S-K.

PROPOSAL 2: RATIFICATION OF APPOINTMENT OF AUDITORS

Our Audit Committee has selected Deloitte & Touche LLP,  an independent registered public accounting firm, as our auditors for the year ending December 31, 2017. Although shareholder approval of the selection of Deloitte & Touche LLP is not required by law, the Board believes that it is advisable to give shareholders an opportunity to ratify this selection. If this proposal is not approved by our shareholders at the 2017 Annual Meeting, our Audit Committee will reconsider their selection of Deloitte & Touche LLP.  Deloitte & Touche LLP has been our independent registered public accounting firm since 2002. Representatives of Deloitte & Touche LLP will be present at the 2017 Annual Meeting of Shareholders, will have the opportunity to make a statement, if they so desire, and will be available to answer appropriate questions.

FEES PAID TO AUDIT FIRM

During the years ended December 31, 2016 and 2015, we retained Deloitte & Touche LLP to provide services in the following categories and amounts:

(1)   Audit-related fees were primarily for assurance services and services that are not required by statute or regulation.

(2)   Consists of fees for tax consulting services, including evaluation of recently issued regulations, as well as the Company’s qualifications for certain tax benefits.

Pre-Approval Policy for Services Provided by our Independent Registered Public Accounting Firm

The Audit Committee has established a policy to pre-approve all permissible audit and non-audit services provided by our independent registered public accounting firm consistent with applicable SEC rules. Our independent registered public accounting firm is prohibited from performing any management consulting projects. Our independent registered public accounting firm is also prohibited from providing tax consulting services relating to transactions or proposals in which the sole purpose may be tax avoidance or for which the tax treatment may not be supported by the United States Internal Revenue Code of 1986, as amended (the “Code”). Prior to the engagement of our independent registered public accounting firm for the next year’s audit, management submits an aggregate of services expected to be rendered during that year for each of the categories of services described above to the Audit Committee for approval. Prior to engagement, the Audit Committee pre-approves these services by category of service. The fees are budgeted by category of service and the Audit Committee receives periodic reports from management and our independent registered public accounting firm on actual fees versus the budget by category of service. During the year, circumstances may arise when it may become necessary to engage our independent registered public accounting firm for additional services not contemplated in the original pre-approval of the services. In those instances, the Audit Committee is required to provide specific pre-approval before engaging our independent registered public accounting firm.

The Audit Committee may delegate pre-approval authority to one or more of its members, who are required to report, for informational purposes, any pre-approval decisions to the Audit Committee at its next regularly scheduled meeting.

Board Recommendation

THE TUTOR PERINI BOARD OF DIRECTORS UNANIMOUSLY RECOMMENDS A VOTE “FOR” RATIFICATION OF THE SELECTION OF DELOITTE & TOUCHE LLP AS INDEPENDENT AUDITORS FOR TUTOR PERINI FOR THE YEAR ENDING DECEMBER 31, 2017.

PROPOSAL 3: APPROVAL OF THE TUTOR PERINI CORPORATION INCENTIVE COMPENSATION PLAN

The Company currently maintains the Amended and Restated Tutor Perini Corporation Long-Term Incentive Plan, as amended and restated on October 2, 2014 (the “Current Plan”). Although the Compensation Committee believes that the Current Plan has been effective in providing key employees strategic alignment with shareholder interests and achievement of retention goals of key employees, the Compensation Committee also believes that a new omnibus Tutor Perini Corporation Incentive Compensation Plan (the “Plan”) is desirable in order to continue to provide long- and short-term equity-based and cash-based incentive awards to key employees and continue to provide key employees strategic alignment with shareholder interests and achievement of retention goals of key employees. The Plan authorizes the grant of equity awards in respect of 2,335,000 shares of our Common Stock, 405,529 of which were available for issuance under the Current Plan as of April 3, 2017. The Current Plan will govern all outstanding awards as of April 3, 2017; however, no new awards will be granted under the Current Plan.

Based on its review of the Plan, the Compensation Committee recommended to the Board that the Plan be adopted. It is common practice for public companies to have incentive plans that utilize share-based awards to reward and motivate their executives, and executives of public companies expect share-based awards to be part of their long-term compensation. Accordingly, the Board recommends that the Company’s shareholders approve the Plan for the following reasons:

The Plan is important to ensure the Company is able to continue its long-term, share-based incentive strategy, which is a critical element of its Pay-for-Performance compensation philosophy designed to align executive incentives with the creation of shareholder value;

The Plan is important to ensure that the Company is able to retain and attract the executive talent needed to ensure the future success of the Company, which is increasingly critical given the project opportunities ahead and the competition that the Company faces for executive talent;

The Plan is important because it will reduce the administrative cost and expense required to manage multiple plans; and

The Plan is important because it provides for a minimum vesting of one-year, with certain limited exceptions, on share-based awards and prohibits the payment of cash dividends on unvested awards; both are provisions designed to further align the Plan with shareholders’ interests, based on feedback we have received.

Summary Description of the Plan.  The following is a summary of the principal features of the Plan. The summary is not a complete description of all the terms of the Plan and is qualified in its entirety by reference to the complete text of the Plan, which is attached to this Proxy Statement as Exhibit A.

Plan Administration. The Plan is administered by the Compensation Committee of our Board of Directors (the “Administrator”), which has full power to select the eligible individuals to whom awards will be granted, to make any combination of awards to participants, and to determine the specific terms and conditions of each award, subject to the provisions of the Plan. The Administrator may permit Common Stock, and other amounts payable pursuant to an award, to be deferred. In such instances, the Administrator may permit interest, dividends or deemed dividends to be credited to the amount of deferrals. In addition, the Administrator may not reprice outstanding options.

Eligibility and Limitations on Grants. All full-time and part-time officers, employees, non-employee directors and other key persons of Tutor Perini and its subsidiaries are eligible to participate in the Plan, subject to the discretion of the Administrator.

The maximum number of shares available for issuance under the Plan is described above. The maximum award of stock options, stock appreciation rights or any award of restricted stock or deferred stock that is intended to qualify as “performance based compensation” under Section 162(m) of the Code granted to any one individual will not exceed 500,000 shares of Common Stock (subject to adjustment for stock splits and similar events) for any calendar-year period. The minimum vesting period for all future awards under this Plan shall be one year, with certain limited exceptions as specified in the Plan.

Stock Options. Options granted under the Plan may be either incentive stock options (within the meaning of Section 422 of the Code) or non-qualified stock options. Incentive options may be granted only to employees of Tutor Perini or any subsidiary. To qualify as incentive options, options must meet additional federal tax requirements, including a $100,000 limit on the value of shares subject to incentive options which first become exercisable in any one calendar year, and a shorter term and higher minimum exercise price in the case of ten percent shareholders. Options granted under the Plan will be non-qualified options if they (i) fail to qualify as incentive options, (ii) are granted to a person not eligible to receive incentive options under the Code, or (iii) otherwise so provide, and may be granted to any persons eligible to receive incentive stock options and to non-employee directors and other key persons.

The Administrator has authority to determine the terms of options granted under the Plan. However, options must be granted with an exercise price that is not less than the fair market value of the shares of Common Stock on the date of the option grant. The term of each option will be fixed by the Administrator but may not exceed ten years from the date of grant. The Administrator will determine at what time or times each option may be exercised and, subject to the provisions of the Plan, the period of time, if any, after retirement, death, disability or termination of employment during which options may be exercised. Options may be made exercisable in installments, and the exercisability of options may be accelerated by the Administrator. In general, unless otherwise permitted by the Administrator, no option granted under the Plan is transferable by the optionee other than by will or by the laws of descent and distribution, and options may be exercised during the optionee’s lifetime only by the optionee, or by the optionee’s legal representative or guardian in the case of the optionee’s incapacity.

Options granted under the Plan may be exercised for cash or by transfer to Tutor Perini (either actually or by attestation) of shares of Common Stock that are not then subject to restrictions under any Tutor Perini stock plan, and that have a fair market value equivalent to the option exercise price of the shares being purchased. Subject to applicable law, options granted under the Plan also may be exercised by compliance with certain provisions pursuant to which a securities broker delivers the purchase price for the shares to us.

Stock Appreciation Rights. The Administrator may award a stock appreciation right (“SAR”) either as a freestanding award or in tandem with a stock option. The term of each freestanding SAR will be fixed by the Administrator but may not exceed ten years. The term of a SAR granted in tandem with a stock option shall be the same as the related stock option. Upon exercise of the SAR, the holder will be entitled to receive an amount equal to the excess of the fair market value on the date of exercise of one share of Common Stock over the exercise price per share specified in the related stock option (or, in the case of a freestanding SAR, the price per share specified in such SAR) times the number of shares of Common Stock with respect to which the SAR is exercised. This amount may be paid in cash, in shares of Common Stock, or a combination thereof, as determined by the Administrator. The exercise price per share of SARs may not be less than 100% of the fair market value of the shares of Common Stock on the date of grant.

Prohibition on Repricing of Stock Options and SARs without Shareholder Approval. The Administrator may not implement any of the following repricing or cash-out programs without obtaining shareholder approval: (i) reduce the exercise price of an outstanding stock option or an outstanding SAR; (ii) cancel outstanding stock options or outstanding SARs in exchange for other stock options or other SARs with an exercise price that is less than the exercise price of the cancelled stock options or cancelled SARs, as applicable; or (iii) cancel an outstanding stock option or an outstanding SAR with an exercise price that is less than the fair market value of a share of Common Stock on the date of cancellation in exchange for cash or another award.

Restricted Stock Awards. The Administrator may grant shares, at a purchase price (which may be zero, subject to the limitations of applicable law) determined by the Administrator, of Common Stock to any participant subject to such conditions and restrictions as the Administrator may determine. These conditions and restrictions may include the achievement of pre-established performance goals and/or continued employment with Tutor Perini through a specified vesting period, as determined by the Administrator. However, in the event these awards have a performance-based goal, the restriction period will be at least one year, and in the event these awards have a time-based restriction, the restriction period will be at least three years. If the applicable performance goals and other restrictions are not attained, the participant will forfeit his or her award of restricted stock.

Deferred Stock Awards. The Administrator also may award phantom stock units or restricted stock units as deferred stock awards to participants. The deferred stock awards are ultimately payable in the form of shares of Common Stock and/or cash and may be subject to such conditions and restrictions as the Administrator may determine, including the achievement of certain performance goals and/or continued employment with Tutor Perini through a specified vesting period. However, in the event these awards have a performance-based goal, the restriction period will be at least one year, and in the event these awards have a time-based restriction, the restriction period will be at least three years. During the deferral period, subject to terms and conditions imposed by the Administrator, the deferred stock awards may be credited with dividend equivalent rights (discussed below). Subject to the consent of the Administrator, a participant may make an advance election to receive a portion of his or her compensation or restricted stock award otherwise due in the form of a deferred stock award.

Unrestricted Stock Awards. The Administrator may also grant shares (at no cost or for a purchase price determined by the Administrator) of Common Stock that are free from any restrictions under the Plan. Unrestricted stock may be granted to any participant in recognition of past services or other valid consideration, and may be issued in lieu of cash compensation due to such participant.

Dividend Equivalent Rights. The Administrator may grant dividend equivalent rights that entitle the recipient to receive credits for dividends that would be paid if the recipient had held specified shares of Common Stock. Dividend equivalent rights may be granted as a component of another award or as a freestanding award. Dividend equivalents shall be credited to a dividend book entry account on behalf of the holder, provided that such dividend equivalents shall be paid at the same time that the dividend equivalent rights are

vested. Dividend equivalent rights may be settled in cash, shares of Common Stock or a combination thereof, in a single installment or installments, as specified in the award.

Limitations on Vesting. No Award granted under the Plan shall vest earlier than the first anniversary of its date of grant, unless such award is granted in lieu of salary, bonus or other compensation otherwise earned by or payable to a grantee. This limitation does not apply to awards granted to non-employee directors of the Company and an aggregate of up to 5% of the maximum number of authorized shares that may be granted under the Plan.

Performance Awards. Stock options and stock appreciation rights granted under the Plan are intended to qualify as “performance-based compensation” for purposes of Section 162(m) of the Code. The Administrator may grant awards of restricted stock and deferred stock that are intended to qualify as “performance-based compensation” for purposes of Section 162(m) of the Code (“162(m) Awards”). If a performance award is payable in cash, it may be paid upon the attainment of the relevant performance goals either in cash or in shares of restricted stock, as determined by the Administrator. These awards may be granted, vest and be paid based on attainment of specified performance goals established by the Administrator. These performance goals will be based on the attainment (on an annual and/or cumulative basis and on an absolute and/or relative basis) of a certain target level of or a specified increase or decrease in, one or more of the following criteria selected by the Administrator:

      earnings per share;

      operating income;

      gross income;

      net income (before or after taxes);

      operating cash flow;

      gross profit;

      gross profit return on investment;

      gross margin return on investment;

      gross margin;

      operating margin;

      working capital;

      earnings before interest and taxes;

      earnings before interest, tax, depreciation and amortization;

      return on equity;

      return on assets;

      return on capital;

      return on invested capital;

      revenue;

      revenue growth;

      recurring revenues;

      sales or market share;

      total shareholder return;

      economic value added;

      safety

      OSHA Recordable Incident Rate

      Lost Time Case Rate

      Lost Workday Rate

      Days Away/Restricted or Job Transfer Rate (DART Rate)

      Experience Modification Rate (EMR)

      individual performance

      specified objectives with regard to limiting the level of increase in all or a portion of Tutor Perini’s bank debt or other long-term or short-term public or private debt or other similar financial obligations of Tutor Perini, which may be calculated net of cash balances and/or other offsets and adjustments as may be established by the Administrator in its sole discretion;

      the fair market value of the shares of Tutor Perini’s Common Stock;

      the growth in the value of an investment in Tutor Perini’s Common Stock assuming the reinvestment of dividends; and/or

      reduction in operating expenses.

The Administrator may provide in any award intended to qualify as a Section 162(m) Award that any evaluation of performance may include or exclude the impact, if any, on reported financial results of any of the following events that occurs during a Performance Period: (a) asset write-downs; (b) litigation or claim judgments or settlements; (c) changes in tax laws, accounting principles or other

laws or provisions; (d) reorganization or restructuring programs; (e) acquisitions or divestitures; (f) discontinued operations; (g) foreign exchange gains and losses; (h) gains and losses that are treated as extraordinary items under Accounting Standards Codification Topic 225; or (i) an event either not directly related to the operations of Tutor Perini or not within the reasonable control of Tutor Perini’s management. To the extent such inclusions or exclusions affect awards to Covered Employees, they shall be prescribed in a form that meets the requirements of Code Section 162(m) for deductibility.

The Administrator retains the discretion to adjust otherwise payable Section 162(m) Award downward, either on a formula or discretionary basis or any combination, as the Administrator determines, in its sole discretion. However, Administrator does not have the authority to adjust upward any otherwise payable Section 162(m) Award.

Performance goals may also be based on an individual participant’s performance goals, as determined by the Administrator, in its sole discretion.

Any Performance Goal may, as the Administrator deems appropriate, (i) relate to the performance of Tutor Perini or any Subsidiary as a whole or any business unit or division of Tutor Perini or any Subsidiary or any combination thereof; (ii) be compared to the performance of a group of peer companies, or published or special index; (iii) be based on change in the applicable performance criteria over a specified period of time and such change may be measured based on an arithmetic change over the specified period (e.g., cumulative change or average change), or percentage change over the specified period (e.g., cumulative percentage change, average percentage change or compounded percentage change); (iv) relate to or be compared to one or more other performance criteria; or (v) any combination of the foregoing.

The Administrator is under no obligation to structure awards granted under the Plan to qualify as 162(m) Awards and has the express authority to grant awards that do not qualify as 162(m) Awards. Additionally, there is no guarantee that an award that is intended to qualify as a 162(m) Award will so qualify in any particular circumstance. To maintain flexibility in compensating our executives, the Administrator reserves the right to use its judgment to grant or approve awards or compensation that is non-deductible when the Administrator believes such awards or compensation is appropriate.

Shareholder approval of the Plan will also constitute approval of the material terms of the performance criteria under the Plan for purposes of establishing the specific vesting targets for one or more 162(m) Awards under the Plan.

Other Cash-Based Awards. The Administrator may grant other cash-based awards in such amounts, on such terms and conditions, and for such consideration, including no consideration or such minimum consideration as may be required by applicable law, as the Administrator determines in its sole discretion. Other cash-based awards may be granted subject to the satisfaction of vesting conditions or may be awarded purely as a bonus and not subject to restrictions or conditions, and if subject to vesting conditions, the Administrator may accelerate the vesting of such awards at any time in its sole discretion.

Tax Withholding. Participants under the Plan are responsible for the payment of any federal, state or local taxes that we are required by law to withhold upon any option exercise or vesting of other awards. Subject to approval by the Administrator, participants may elect to have their tax withholding obligations satisfied either by authorizing us to withhold shares of Common Stock to be issued pursuant to an option exercise or other award, or by transferring to us shares of Common Stock having a value equal to the amount of such taxes.

Adjustments for Stock Dividends, Mergers, etc. The Administrator may make appropriate adjustments to the number of shares of Common Stock that are subject to the Plan and to any outstanding stock options to reflect stock dividends, stock splits and similar events. In the event of certain transactions, such as a merger, consolidation, dissolution or liquidation of Tutor Perini, the Plan and all awards will terminate unless the parties to the transaction, in their discretion, provide for appropriate substitutions or adjustments of outstanding stock options or other awards.

Amendments and Termination. The Board of Directors may at any time amend or discontinue the Plan and the Administrator may at any time amend or cancel any outstanding award, but no such action shall adversely affect the rights under any outstanding awards without the holder’s consent subject to certain exceptions. These exceptions permit the Administrator to amend outstanding awards to adjust for the occurrence of certain unusual or nonrecurring events and to conform to legal requirements without the written consent of the award recipient. Any amendments that materially change the terms of the Plan, including any amendments that increase the number of shares reserved for issuance under the Plan, expand the type of awards available, materially expand the eligibility to participate or materially extend the term of the Plan, or materially change the method of determining fair market value, will be subject to approval by our shareholders. To the extent required by the Code to ensure that options granted under the Plan qualify as incentive options or that compensation earned under awards granted under the Plan qualify as performance-based compensation under the Code, Plan amendments shall be subject to approval by our shareholders.

Term of the Plan. No award will be granted under the Plan on or after the tenth anniversary of the Effective Date, but awards granted prior to the tenth anniversary may extend beyond that date. No award (other than a stock option or SAR) that is intended to be “performance-based compensation” under Section 162(m) will be granted on or after the fifth anniversary of the Effective Date unless the Performance Goals are re-approved (or other designated Performance Goals are approved) by our shareholders no later than the first shareholder meeting that occurs in the fifth year following the year in which shareholders previously approved the Performance Goals. Subject to approval of the Plan by our shareholders and to the requirement that no stock may be issued under the Plan prior to shareholder approval, stock options and other awards may be granted under the Plan on and after adoption of the Plan by the Board of Directors.

Certain U.S. Federal Income Tax Consequences

The rules concerning the federal income tax consequences with respect to options granted and to be granted pursuant to the Plan are quite technical. Moreover, the applicable statutory provisions are subject to change, as are their interpretations and applications, which may vary in individual circumstances. Therefore, the following is designed to provide a general understanding of the U.S. federal income tax consequences with respect to such grants. In addition, the following discussion does not set forth any gift, estate, social security or state or local tax consequences that may be applicable and is limited to the U.S. federal income tax consequences to individuals who are citizens or residents of the United States, other than those individuals who are taxed on a residence basis in a foreign country.

Incentive Stock Options. In general, an employee will not realize taxable income upon either the grant or the exercise of an incentive stock option and Tutor Perini will not realize an income tax deduction at either of such times. In general, however, for purposes of the alternative minimum tax, the excess of the fair market value of the shares of Common Stock acquired upon exercise of an incentive stock option (determined at the time of exercise) over the exercise price of the incentive stock option will be considered income. If the recipient was continuously employed from the date of grant until the date three months prior to the date of exercise and such recipient does not sell the shares of Common Stock received pursuant to the exercise of the incentive stock option within either (i) two years after the date of the grant of the incentive stock option, or (ii) one year after the date of exercise, a subsequent sale of such shares of Common Stock will result in long-term capital gain or loss to the recipient and will not result in a tax deduction to Tutor Perini.

If the recipient is not continuously employed from the date of grant until the date three months prior to the date of exercise or such recipient disposes of the shares of Common Stock acquired upon exercise of the incentive stock option within either of the time periods described in the immediately preceding paragraph, the recipient will generally realize as ordinary income an amount equal to the lesser of (i) the fair market value of such shares of Common Stock on the date of exercise over the exercise price, and (ii) the amount realized upon disposition over the exercise price. In such event, subject to the limitations under Sections 162(m) and 280G of the Code (as described below), Tutor Perini generally will be entitled to an income tax deduction equal to the amount recognized as ordinary income. Any gain in excess of such amount realized by the recipient as ordinary income would be taxed at the rates applicable to short-term or long-term capital gains (depending on the holding period).

Nonqualified Stock Options. A recipient will not realize any taxable income upon the grant of a nonqualified stock option and Tutor Perini will not receive a deduction at the time of such grant unless such option has a readily ascertainable fair market value (as determined under applicable tax law) at the time of grant. Upon exercise of a nonqualified stock option, the recipient generally will realize ordinary income in an amount equal to the excess of the fair market value of the shares of Common Stock on the date of exercise over the exercise price. Upon a subsequent sale of such shares of Common Stock by the recipient, the recipient will recognize short-term or long-term capital gain or loss depending upon his or her holding period of such shares of Common Stock. Subject to the limitations under Sections 162(m) and 280G of the Code (as described below), Tutor Perini will generally be allowed a deduction equal to the amount recognized by the recipient as ordinary income.

Certain Other Tax Issues. In addition to the matters described above, (i) any entitlement to a tax deduction on the part of Tutor Perini is subject to applicable federal tax rules (including, without limitation, Section 162(m) of the Code regarding the $1,000,000 limitation on deductible compensation); (ii) the exercise of an incentive stock option may have implications in the computation of alternative minimum taxable income; (iii) certain awards under the Plan may be subject to the requirements of Section 409A of the Code (regarding nonqualified deferred compensation); and (iv) if the exercisability or vesting of any award is accelerated because of a change in control, such award (or a portion thereof), either alone or together with certain other payments, may constitute parachute payments under Section 280G of the Code, which excess amounts may be subject to excise taxes. Officers and directors of Tutor Perini subject to Section 16(b) of the Securities Exchange Act of 1934, as amended, may be subject to special tax rules regarding the income tax consequences concerning their options.

The Plan is not subject to any of the requirements of the Employee Retirement Income Security Act of 1974, as amended. The Plan is not, nor is it intended to be, qualified under Section 401(a) of the Code.

Future Plan Awards. The terms and number of options or other awards to be granted in the future under the Plan are to be determined in the discretion of the Compensation Committee. Since no such determinations regarding awards or grants have yet been made, the benefits or amounts that will be received by or allocated to the Company’s executive officers or other eligible employees or non-employee directors cannot be determined at this time.

Equity Compensation Plan Information for 2016

As of December 31, 2016, the Current Plan had outstanding securities and securities available to be awarded, as follows:

Burn Rate

The following table sets forth information regarding certain awards granted and earned, the burn rate for each of the last three years, and the average burn rate over the last three years.

Required Vote

The affirmative vote of a majority of the votes duly cast is required to approve this Proposal 3.

THE TUTOR PERINI BOARD OF DIRECTORS UNANIMOUSLY RECOMMENDS SHAREHOLDERS VOTE “FOR” THE APPROVAL OF THE TUTOR PERINI CORPORATION INCENTIVE COMPENSATION PLAN.

PROPOSAL 4: ADVISORY (NON-BINDING) VOTE ON TUTOR PERINI’S EXECUTIVE COMPENSATION

Section 951 of the Dodd-Frank Act requires that the Company seek an advisory (non-binding) vote from its shareholders to approve the compensation of our named executive officers (“NEOs”), as disclosed in the CD&A and tabular disclosures of this proxy statement.

As described in detail in the CD&A, we seek to provide our executives with appropriate incentives to drive the success of our business. We strive to design an executive compensation program that is primarily performance-based, encourages executives to further the overall business strategy of the Company and aligns our NEOs’ interests with those of our shareholders. We provide compensation that is highly competitive and designed to attract and retain high-quality executives that can deliver successful results.

The Company and the Compensation Committee have made considerable progress and improvements with regard to executive compensation, directly in response to various concerns expressed by shareholders and independent proxy advisors. These areas of improvement include share pledging, CEO Pay-for-Performance,  the level of CEO pay, diversification of performance metrics and the length of performance periods for long-term incentive compensation, among others (see page 29 for details). The improvements demonstrate the Company’s regard for its shareholders’ opinions and its willingness to effect changes necessary to warrant shareholder support for its executive compensation.

The vote on this resolution is not intended to address any specific element of compensation; rather, the vote relates to the overall compensation of our NEOs, as described in this proxy statement. We believe that the Company’s executive compensation program has been effective at appropriately aligning pay and performance and enabling the Company to attract and retain highly talented executives within our industry.

The vote on this resolution, commonly referred to as the Say on Pay resolution, is advisory and, therefore, not binding on the Company, the Compensation Committee or the Board. Although the vote is non-binding, the Compensation Committee will review the voting results in connection with its on-going evaluation of and future decisions regarding additional changes and improvements to the Company’s executive compensation program.

Board Recommendation

THE TUTOR PERINI BOARD OF DIRECTORS UNANIMOUSLY RECOMMENDS SHAREHOLDERS VOTE “FOR” THE FOLLOWING RESOLUTION:

“RESOLVED, that the shareholders approve the compensation awarded by the Company to the Named Executive Officers, as described in the CD&A, tabular disclosures and other narrative executive compensation disclosures in this proxy statement as required by the rules of the Securities and Exchange Commission.”

EXECUTIVE OFFICERS



The following table sets forth certain information onabout our executive officers.officers:





For biographical summaries of Mr. Tutor and Mr. Frost, who are also directors, see Proposal 1 above.

Michael J. Kershawon page served as Executive Vice President and Chief Financial Officer from September 2011 through August 2015. Previously, he served as Senior Vice President and Chief Accounting Officer of The Shaw Group, Inc., a global provider of technology, engineering, procurement, and construction services. Mr. Kershaw joined The Shaw Group in September 2007 as Senior Vice President and Corporate Controller. From 2005 until September 2007, he served as the Vice President of Accounting and Finance of the Energy and Chemicals Division of KBR, Inc., a global engineering, construction and services company. From 2003 until 2005, Mr. Kershaw served as Senior Controller for KBR, Inc. Mr. Kershaw holds a Master of Business Administration degree from Tulane University and a Bachelor of Science degree in Economics and Accounting from the University of Bristol in England. He is a fellow of the Institute of Chartered Accountants in England and Wales.4.



Gary G. Smalley has served as Executive Vice President and Chief Financial Officer since September 2015. Previously, he served as Senior Vice President, Controller and ControllerChief Accounting Officer of Fluor Corporation (“Fluor”), a global engineering, procurement, fabrication and construction company, sincefrom March 2008 and, from October 2014 until July 2015, and concurrently served as Group Chief Financial Officer for one of Fluor's business segments.segments from October 2014 until July 2015. Prior to these roles, Mr. Smalley was employed by Fluor as Vice President of Internal Audit from September 2002 to March 2008 and, sinceafter joining Fluor in 1991, held a variety of other financial management positions in Australia, Chile, Mexico and the United States. Prior to joining Fluor, he held audit positions with Ernst & Young and J.P. Stevens and Company. Mr. Smalley holds a Bachelor of Science degree in Business Administration from the University of North Carolina at Chapel Hill and a Master of Business Administration degree from Northwestern University. He is a Certified Public Accountant, Certified Fraud Examiner and a Chartered Global Management Accountant.



Craig W. Shaw was appointed Executive Vice President and Chief Executive Officer of the Building Group in May 2013. Mr. Shaw was previously appointed in May 2007, and continues to serve, as President and Chief Executive Officer of Tutor Perini Building Corp., one of the business units within the Building Group. Prior to that, he served in various project and executive management positions, including President atof Perini Building Company sinceafter joining the Company in 1978. Mr. Shaw holds a Bachelor of Science degree in Construction Engineering from Arizona State University.



Our officers are elected on an annual basis at the Board of Directors’ meeting immediately followingpreceding the Annual Meeting of Shareholders, to hold such offices until the Board of Directors’ meeting followingpreceding the next Annual Meeting of Shareholders and until their respective successors have been duly appointed or until their earlier resignation or removal.



COMPENSATION DISCUSSION AND ANALYSIS



IntroductionEXECUTIVE SUMMARY



This section Compensation Discussion and Analysis (“CD&A”), addresses executive compensation in 20152016 for our named executive officers (“NEOs”), who are:

Tutor, Perini’sGary G. Smalley, James A. Frost and Craig W. Shaw. Our core compensation philosophy is based on the concept of pay for performance.Pay-for-Performance. Accordingly, our executive compensation program is predicated on providing significant performance-based compensation to our NEOs allowingthat can allow them to earn amounts that are greater than their base salary if they achieve financial goals that the Compensation Committee and the Board believe are critical to enhancing shareholder value. The following discussion will cover our executive compensation practices and the unique factors that play into these practices. We will discuss our 20152016 business results, and the outcome of the 20152016 advisory vote on our executive compensation, our robust shareholder outreach efforts and the progress we are making on governance and executive compensation, including actions we have taken in response to both.last year’s advisory vote, and shareholder and independent proxy advisor feedback. Finally, we will discuss the process the Compensation Committee follows in deciding how to compensate our NEOs and the various elements of the NEOsNEOs’ compensation.



Executive Compensation PracticesEXECUTIVE COMPENSATION PROGRAM AND PRACTICES



Tutor Perini’s executive compensation program is designed to reflect appropriate governancecompensation practices aligned with the needs of our business. Below is a summary of our compensation practices we have implemented tothat drive performance in alignment with shareholder interests, followed by a list of those we do not practice.



1Mr. Kershaw served as Executive Vice President and Chief Financial Officer through August 31, 2015.

2Mr. Smalley commenced his employment with the Company as Executive Vice President and Chief Financial Officer on September 1, 2015.

3Mr. Frost was promoted to the position of President and Chief Operating Officer and appointed to the Company’s board of directors on February 12, 2015.



Unique Factors Play

2016 FINANCIAL RESULTS AND BUSINESS OUTLOOK

Our executive compensation program is designed to incentivize NEOs and employees to deliver superior financial results, which we believe will directly translate into our Executive Compensation Decisions and Practicesshareholder value creation.

2016 Financial Results



Over the past several years, Mr. Tutor has been the key driving force—both strategically and operationally—behind the Company’s growth and evolution into a stronger, vertically integrated and broader geographic player in the market. Through several strategic acquisitions and other business decisions, including a refocus from the Las Vegas market to the New York market, Mr. Tutor has transformed the Company from a firm primarily involved in lower-margin building work to one that today boasts a broad nationwide footprint with particular strength in the California, New York, Florida and other East Coast markets. Our growth is driven today by a large volume of higher-margin civil and specialty contracting opportunities and an increasing volume of larger, complex building project opportunities. The Company’s uniquehistory and evolution has had a substantial impact on the Company’s executive compensation views and practices.

Mr. Tutor’s value to the Company is significant. This factors in to the Compensation Committee’s decision-making process and plays strongly into the Compensation Committee’s views on the appropriateness of Mr. Tutor’s compensation.

Tutor Perini is a construction services company that competes with many other companies—both public and private—for projects and for executive talent. Our closest competitors for projects are primarily large privately held firms or U.S. subsidiaries of foreign parent firms, whose focus and revenues stem largelyIncome from construction services and less from providing design and engineering services. In contrast, the revenues of many of the larger publicly traded companies with which we sometimes compete are primarily consulting, design, architecture and engineering services, with some construction-related revenues. Our Board and executive management have found through various succession planning endeavors that overall executive compensation levels at our privately held and U.S. subsidiary competitors tendoperations increased 92% to be higher compared with compensation levels at our publicly traded peers. While Mr. Tutor’s compensation is higher than the compensation levels of CEOs at several of the Company’s public peers, the Board believes it is comparable$201.9 million on modest revenue growth, due to the compensation levels of CEOs at non-public peers and significantly lower than his compensation under his predecessor company, privately held Tutor-Saliba.

The construction markets in which the Company operates are inherently cyclical and demand levels fluctuate significantly more than in the markets for consulting, engineering and design services. Throughout these cycles, we strive to ensure that our executive compensation program remains consistent with the competitive labor markets for executive talent, especially in comparison with the privately held and U.S. subsidiary peers with which we compete for projects and executive talent. The Compensation Committee considers, when available, private company compensation levels and construction market cyclicality and volatility as important factors when assessing and understanding the Company’s executive compensation program.

The success of our diversification and growth efforts continues to be evidenced by the various large contract awards received in 2015.See “2015 Business Results and Key Events” below. Mr. Tutor plays a vital role in the review and approval process of bids for many of the Company’s larger prospective projects. Mr. Tutor also plays an instrumental role in navigating and negotiating the legal processes related to various disputes over our claims, unapproved change orders and other matters.improved operating performance across all segments.



2015 Business ResultsDiluted EPS increased 111% to $1.92 and Key Eventswas within the original 2016 EPS guidance range provided.



Business ResultsGenerated $113.3 million of cash from operating activities through management’s intense focus on reducing unbilled costs and improving billings and collections.



Our revenue grew 10% to $4.9 billion inCash flow generation was 705.4% better than 2015 compared to $4.5 billion in 2014. The revenue growth was driven by strong performance from our Civil and Building segments, the revenue of which increased by 20% and 12%,  respectively, in 2015, supported by continued strong demand for new building and civil infrastructure, especially in the California, New York and Midwest markets. Our Specialty Contractors segment revenue declined 6% in 2015 due to reduced activity on electrical projects at the World Trade Center and mechanical projects at the United Nations in New York, as well as on various smaller electrical projects in the southern United States.its highest level since 2008.



We faced a number of unique challenges in 2015 that prevented us from achieving our profit expectations for the year. Most significant of these were $45.6 million of pre-tax project charges recorded in the Specialty Contractors segment by our New York City electrical subsidiary, Five Star Electric (Five Star). We believe that certain management personnel changes at Five Star, together with detailed project claims reviews we perform, and our close ongoing coordination with the new Five Star management team, will result in better performance and accountability going forward at Five Star. Other issues that impacted us in 2015 included a $24.3 million pre-tax loss in the Building segment on the since completed Tower C concrete superstructure project in New York and a $23.9 million pre-tax litigation-related charge in the Civil segment pertaining to a long-standing lawsuit for a completed joint venture project that predated our 2011 acquisition of Frontier-Kemper.

Predominantly as a result of these issues, ourOperating cash exceeded net income decreased to $45.3 million in 2015 compared to $107.9 million in 2014. Because the Company did not achieve its consolidated pre-tax income performance target, none of our NEOs earned or was paid his

incentive compensation (bonus) award for the year, except for Mr. Frost. The Compensation Committee deemedthe first time in eight years.

Reduced unbilled costs by $73.3 million (and first time since 2010 that Mr. Frost earned his incentive compensation award for 2015 based on his continued role and responsibilities as CEO of the Civil group, and the Civil group’s achievement of its pre-tax income performance target. For more information, see “Incentive Compensation Plan – Annual Awards” starting on page 23unbilled costs declined year-over-year).



Continued Strong End Market Demand across our Business

During 2015, we addedAdded approximately $4.6$3.7 billion of new awardsawards* and adjustments to existing contracts. These included various significant project awards, such as an $800 million technology research and development office facility project and $230 million of incremental funding for a biotechnology facility project, both in California, a $239 million hospitality building project in Pennsylvania, an $80 million mass-transit project in New York, highway projects in Delaware, Maryland and Pennsylvania valued at $70 million, $60 million and $58 million, respectively, and a tunnel extension project in New York worth $56 million.



We ended 2015Ended the year with a strong backlogbacklog* of $7.5$6.2 billion, nearlymore than two-thirds of which is associated with higher-margin civil and specialty projects. In addition,

*New awards and backlog, as presented herein, are supplemental measures of our performance. These measures are not required by or presented in accordance with accounting principles generally accepted in the United States (“GAAP”). Management uses new awards and backlog to assist in forecasting future results.

New awards consist of the original contract price of projects added to our backlog plus or minus subsequent changes to the estimated total contract price of existing contracts.

Backlog is a measure of the total value of work that is remaining to be performed on contracts awarded. We include a construction project in our backlog when a contract is awarded or a letter of commitment is obtained and we had approximately $3.6believe adequate funding is in place.

As a result of the Company’s solid financial performance in 2016, each of our NEOs earned substantial portions of their target annual incentive (bonus) compensation awards for the year, which was not the case in 2015 when the Company did not meet certain of its performance targets. For more information, see “Annual Incentive Compensation” starting on page 37.

Our stock price also grew substantially in 2016, rewarding shareholders with an increase of 67.3% for the year (compared to a 36.3% average increase for our publicly traded peer group companies), which reflected the Company’s improved financial performance and investor optimism regarding the Company’s expected participation in the increased infrastructure project opportunities anticipated over the next several years.

Business Outlook

We have booked more than $1.7 billion of pendingnew awards atin the first quarter of 2017 and anticipate backlog growth in 2017.

We expect continued profitable growth and solid operating cash results, with operating cash again exceeding net income in 2017.

Significant bipartisan support and a strong focus on infrastructure spending – from the passage of $200 billion of voter-approved transportation measures in the November 2016 election to President Trump’s planned $1 trillion infrastructure spending program – is bolstering demand across our end markets.

Even before the impact of 2015,the above-mentioned factors, we are already seeing an unprecedented demand and level of bidding activity, and we expect that many of these awards will be booked into backlog in 2016. Finally, the strength of our end markets remainsthis activity to continue over at elevated levels unseen in many years. We have approximately $35 billion of prospective projects to be bid and awarded overleast the next 12 to 18 months across all our segments, including $20 billion for the Civil segment, $12 billion for the Building segment and $3 billion for the Specialty Contractors segment.

Key Events

In July 2015, we announced the appointment of Gary G. Smalley as Executive Vice President and Chief Financial Officer to replace Michael J. Kershaw. Prior to commencing his employment with the Company on September 1, 2015, Mr. Smalley served in several executive and managerial positions with Fluor since 1991 (for his full biography, see page 13). Mr. Kershaw continues to serve the Company in a limited capacity, providing consulting services and support for certain special projects.years.



2015WHERE WE HAVE BEEN AND WHERE WE ARE GOING

2016 Advisory Vote on Executive Compensation



At our 20152016 Annual Meeting of Shareholders, 38%less than a majority of the votes cast by our shareholders supported the executive compensation of our NEOs. Accordingly, our shareholders by majority vote did not approve, on a non-binding advisory basis,The Company and the executive compensation of our NEOs. The Compensation Committee considered these resultsthe result of the voting in assessing whether there was a need for modification or enhancement of our executive compensation program and plans. Theother governance issues. While the Company and the Compensation Committee believesgenerally believe that our existing executive compensation program properly encourages and plans properly encourage and rewardrewards the achievement of financial results that promote long-term shareholder value creation. No new equity awards were approved in 2015 beyond those equity grants that had already been approvedcreation, they have taken significant steps toward addressing many of the most common concerns expressed by our shareholders and awarded in prior years, with the exception of equity awarded to Mr. Frost in connection with his promotion to the position of President and Chief Operating Officer, which allows for annual grants in three tranches from 2015 through 2017, and to Mr. Smalley in connection with the commencement of his employment, which allows for annual grants in three tranches from 2016 through 2018. The Company continues its shareholder outreach program to solicit feedback and suggestions from our larger shareholders regarding our executive compensation program and plans, in order to inform future executive compensation decisions.proxy advisory firms. Further details about these efforts are discussed below.



Shareholder Outreach Program



Since 2012, we have conducted an ongoing shareholder outreach program to maintain an open and regular dialogue with certain of our largerinstitutional shareholders to understand their views and concerns regarding our executive compensation program. Additionally, this outreach program is intended to provide insightsinsight to our shareholders regarding the Company’s unique evolution, history and position in its industry, and the relative lack of comparability between Tutor Perini and other public companies in terms of its size, industry focus and operations. Our outreach program has included productive discussions regarding certain policy changes the Company has implemented over the past few years in light of its recent advisory votes on executive compensation.

Most recently, in early 2017, we invited our top 1825 institutional shareholders, who collectively representedrepresenting more than 55%60% of our outstanding shares, to a dialogue regardingdiscuss their views opinions, and proxy voting guidelines with respect to companies’our executive compensation program and disclosures, anddisclosures. As a result, we held discussions with severalfive of thesethe largest institutional shareholders as a result. Discussionsthat represented approximately 18% of our shares outstanding. Topics discussed with shareholders recently, as well as over the past few years, have included topics such asthe level of CEO compensation, our compensation disclosure, equity award vesting periods, and performance-based vesting criteria and metrics, board and committee composition, share pledging, voting standards for director elections, talent management and succession planning. The participants of Tutor Perini’s shareholder outreach team have generally consisted of our Chief Financial Officer, our Vice President of Investor Relations and, at times,frequently, the chair of our Compensation Committee or our Lead Independent Director. The Company and the Compensation Committee intendsintend to continue to expand this outreach program going forwardby increasing the frequency of its outreach efforts in order to facilitate continued shareholder input into the Company’s compensation philosophy.



Recent Actions Taken Based on Shareholder and Proxy Advisor Feedback

The following table summarizes various concerns expressed by shareholders and proxy advisors during recent discussions and how we are addressing the issues:

Summary of Recent Changes to Executive Compensation

As mentioned earlier, no changes were made in 2015 to our executive compensation program or policies. In addition, no new equity awards were approved in 2015 beyond those equity grants that had already been approved and awarded in prior years, with the exception of equity awarded to Mr. Frost in connection with his promotion to the position of President and Chief Operating Officer, which allows for annual grants in three tranches from 2015 through 2017, and to Mr. Smalley in connection with the commencement of his employment, which allows for annual grants in three tranches from 2016 through 2018. Prior to 2015, the Compensation Committee made certain changes and improvements to our executive compensation program, which are detailed below. These changes were made based upon information and feedback gathered from our larger shareholders as part of our shareholder outreach program,  our executive officers and Meridian. The Board and the Compensation Committee will continue to explore additional ways to improve Tutor Perini's executive compensation program.

Relative-Return-Based Performance Metric for Certain Long-Term Compensation Awards

In 2014, the Compensation Committee approved a new performance-based metric for the award of certain long-term equity incentives based upon the achievement of a 3-year Total Shareholder Return (TSR) relative to the Company’s disclosed peer group. This new relative-return-based metric was applied to two grants of performance shares to Mr. Tutor as part of the consideration for his amended and restated employment agreement, which extended his term with the Company through December 31, 2018 (for more details, see “Employment Agreements” on page 34). This new metric was implemented in response to requests by several of the Company’s largest shareholders for a relative performance metric to be used for long-term incentive compensation.

3-Year Cumulative EPS Metric for Long-Term Equity Compensation Awards

In response to feedback from shareholders during our outreach efforts regarding their preference for a different, longer-term performance metric than an annual pre-tax income metric, in March 2014, the Compensation Committee approved a new performance-based metric for the award of certain long-term equity incentives. The new metric was based upon the achievement of a forward 3-year cumulative consolidated amount of diluted earnings per share (EPS). For the initial measuring year (2014), the level of diluted EPS required to earn the equity bonus was linked to the Company’s announced 2014 EPS guidance. For each subsequent year, the target diluted EPS level is based on a pre-determined annual percentage increase over the prior year’s reported diluted EPS, as specified in each equity award agreement and subject to adjustment at the sole discretion of the Compensation Committee for the financial impact of significant one-time events that are not in the ordinary course of business (e.g., substantial settlements of prior-year claims). The pre-determined annual percentage increase is undisclosed and will not change during the performance period of each award.

Under the 3-year cumulative EPS performance metric, each of the awards shall be earned on a prorated basis to the following extent:

Additional Incentive Compensation Performance Metric

In alignment with shareholder focus and requests for improved cash generation, as discussed during our shareholder outreach program, and in an effort to increase our internal focus on cash generation while continuing to reward the achievement of pre-tax income performance targets, in 2013 the Company implemented an additional incentive compensation (bonus) performance metric based on the Company’s quality of earnings. This metric applies to our key business unit executives and certain other business unit employees who qualify for short-term (annual) incentive compensation. Historically, one of the significant components of the Company’s working capital and cash usage has been the financing of unapproved change orders and claims associated with various projects—both those that are ongoing as well as those that have largely been completed. Given the fact that a significant component of our work is fixed price, it is important that the Company manages that financial risk by clearly identifying changes in scope and pursuing entitlement to financial recovery through contractual change order processes. While these unapproved change orders and claims are being negotiated and finalized, the Company bears the burden of funding the associated costs. By incorporating a performance metric related to the successful negotiation and resolution of unapproved change orders and claims, over time, the Company expects to strongly motivate key business unit executives and other key project executives to more efficiently manage working capital and accelerate cash generation.

The first step is to assess whether the business unit has achieved its pre-tax income target for the period. If that target has been achieved, the second step is to assess the quality of earnings by measuring the percentage of pre-tax income associated with unapproved change orders and claims. If the business unit’s pre-tax income includes significant unapproved change orders and claims,

then full payment of the bonus will not be made until either the change orders have been approved or the Company has successfully negotiated legally enforceable settlements.

Increased Rigor in Performance Goals Related to Long-Term Equity Incentive Compensation

Prior to November 2013, full payouts of long-term equity incentive compensation awards based on pre-tax income performance targets set annually by the Compensation Committee were linked to the achievement of a 70% threshold of the target. Accordingly, if the 70% threshold was achieved, 100% of the long-term equity incentive compensation award was earned and paid. In November 2013, to increase the rigor in performance goals related to our long-term equity incentive compensation, the Company began incorporating sliding-scale award payouts for certain equity awards.

Key Policy Elements of Our Executive Compensation Program

The following are several key policy elements of Tutor Perini’s Executive Compensation program:

Excise Tax Gross-Up: As of September 2013, the Company has no agreements in place that would provide excise tax gross-ups to any NEO in the event of a termination following a change-in-control, and the Company will not enter into any new agreements that would provide such gross-ups.

Stock Ownership Policy: The Company maintains a stock ownership policy whereby the Chief Executive Officer and the Chief Executive Officer’s direct reports are expected to maintain stock ownership levels, dependent on their role,  within five years of appointment. The Chief Executive Officer is subject to a guideline of six times base salary and executive officers that report directly to the Chief Executive Officer are subject to a guideline of three times base salary. As of the most recent measurement date, all NEOs, other than Mr. Smalley who joined the Company effective September 1, 2015, are in compliance with the policy. Mr. Smalley has until August 31, 2020 to acquire the necessary shares. In addition, the Company’s non-employee directors are expected to maintain stock ownership at a level representing at least five times the directors’ annual cash retainer by the later of fiscal year-end 2015 or five years from the date of their election to the Board. As of the most recent measurement date, all non-employee directors are in compliance with the policy, with the exception of Mr. Feltenstein, Mr. Lieber and Ms. Reiss, for whom compliance with the guidelines is not required until November 2018, August 2019, and May 2019, respectively, the five-year anniversary when each became a director.

Stock Retention Policy: The Company maintains a policy requiring the Chief Executive Officer and the Chief Executive Officer’s direct reports to maintain ownership of at least 75% of net shares earned through future equity grants until termination of employment.

Clawback Provision: The Company maintains a clawback policy whereby any future short- and long-term incentive awards are subject to a clawback provision allowing the Company to recoup any incentives earned based on financial information that is later restated, in specific circumstances.

Anti-Hedging Provision: The Company maintains an anti-hedging policy that prohibits executive officers from hedging their position relative to Company stock they own.

In addition to the changes to the executive compensation program and plans discussed above, the Compensation Committee continues to maintain and demonstrate a commitment to a pay-for-performance philosophy. All annual bonuses and equity awards are generally performance-based, with the exception of sign-on and promotional awards used to recruit and retain top talent.

Earlier Changes to Executive Compensation PhilosophyBased on Prior Shareholder Feedback



Our executive compensation program and plans are intended to:The following table summarizes certain changes that the Company made prior to 2016 based on feedback conveyed by shareholders:







In recognition of the cyclicality and variability of the construction industry, we believe that compensation focusing on both variable short-term and long-term corporate goals is appropriate for Tutor Perini and our shareholders. This incentive approach also provides greater rewards for higher performance and has been effective in retaining and motivating our highest-performing key executive talent. As a result, our compensation practices for our NEOs have a significant focus on annual “variable pay” incentive awards. Long-term incentive awards have periodically been granted to select executives when the Compensation Committee has determined an award to be appropriate based upon Companythe Company’s strategic goals, an executive’s superior performance and the perceived value of the executive to the Company.

The Compensation Committee is guided by the above philosophy when making compensation decisions. The Compensation Committee periodically reviews public and, when available, private company market data and evaluates each executive officer’s performance and value to Tutor Perini, balanced with providing a competitive pay package to encourage attraction and retention. Lastly, the Compensation Committee considers ways to appropriately focus the efforts of its executives on achieving Tutor Perini’s overall corporate goals and business strategies.

Pay for Performance

We believe that the results Importantly, all of the Company’s 2015 compensation plan reflect the Company’s pay-for-performance philosophy and alignment of its compensation philosophy with shareholder value creation given the variable industry in which we operate. Mr. Tutor’s amended employment agreement sets his targetperiodic long-term incentive cash bonus compensation at 60% of total target cash compensation (i.e., the sum of base salary and target annual bonus opportunity). Target incentive cash bonus compensation for our other executive officers has historically been set at 40-50% of total target cash compensation (depending upon the position). Additionally, all of our periodic equity grants to our executive officerscurrent NEOs during the past five years have been performance-based withperformance-based.

The Company and its industry are at a crucial point for attracting and retaining top executive talent. There is tremendous pent-up demand following decades of underinvestment in public infrastructure, and the exceptioncurrent environment of restricted stock unit awardsstrong bipartisan support for infrastructure spending is unprecedented. Given this backdrop and a stock option award grantedthe strong demand we are already experiencing in our end markets even before the swell of new infrastructure spending arrives, we anticipate an extraordinary period of even greater demand driven by large complex civil projects over at least the next several years. Therefore, it is critically important that we maintain an executive compensation program that is most attractive and rewarding to Mr. Kershaw in 2011our key executives and 2012.prospective new executives.



The Compensation Committee strivesreviews the Company's compensation philosophy and objectives each year to establish aggressive, but achievable financialdetermine if revisions are necessary in light of market conditions, the Company's strategic goals that motivateor other relevant factors. As detailed earlier in this CD&A, the Company and Compensation Committee have made significant progress and improvements to our executive compensation program in response to shareholder and proxy advisor feedback and have also worked with the Board to effect certain governance improvements.

Management and the Compensation Committee review annually the incentive compensation we provide to our NEOs in relation to attainmarket data for our peer group, including evaluating the levelsmix of prospective work requiredcompensation elements, performance metrics and targets, and risk management practices. Based on this review, the Company and the Compensation Committee concluded that our executive compensation program is designed to growappropriately align compensation for our NEOs and other executives with our business segmentsstrategy and does not encourage behavior that could create material adverse risks to effectively manage the executionCompany. The review identified several risk mitigating factors, such as capped incentive payouts, clawback provisions and independent Compensation Committee oversight of our current projectscompensation plans. Additionally, the review identified a clearly articulated philosophy and peer group, use of competitive market data, and an effective use of cash and strategic equity grants that all contribute to ensure we achieve maximum profitability, while appropriately managing risk.

Because the Company did not achieve its 2015 consolidated pre-tax income performance target, none of our NEOs earned or was paid a bonus, with the exception of Mr. Frost, who was deemed to have earned his bonus based on his continued role as CEO of the Civil Group and based on the Civil Group’s achievement of its performance target. Additionally, substantial long-term incentive equity awards that were granted to Mr. Tutor and Mr. Frost in March 2015 were forfeited in December 2015 because the Company did not achieve the performance threshold required for those grants to vest (see page 28). These outcomes illustrate the effectiveness of the Company’s pay-for-performance philosophy.balanced pay program.



Setting Our Executive Compensation

To execute the executive compensation strategy, the Compensation Committee works with management to determine compensation for the NEOs. The Compensation Committee believes that the CEO is best positioned to evaluate the performance of our other NEOs. Accordingly, the Compensation Committee works closely with Mr. Tutor in establishing the compensation of our other NEOs. The CEO reviews performance of the executive officers and based on his assessment makes recommendations to the Compensation Committee for approval based on these parameters:of base salary and the opportunity, metrics and targets of ourfor both annual cash incentive (bonus) compensation and our long-term incentive equity awards. The Compensation Committee also reviews the CEO’s performance and, based on his performance, makes recommendations regarding CEO compensation to the independent directors of the Board for approval. Additionally, the Compensation Committee reviews available competitive external market data. As part of this process, the Compensation Committee receives independent advice and recommendations as needed, from Meridian, which serves as the Compensation Committee’s executive compensation consultant.



The Compensation Committee annually reviews base salary, annual incentive compensation opportunities and long-term equity target values for executive officers for the current year and assesses this data in relation to market data for the Company’s peer group. Taking into account the Company’s long-term strategy and annual business plan, the Compensation Committee, at its regularly scheduled March meeting, reviews and approves the annual incentive compensation performance targets, as well as our long-term equity award performance targets for awards granted in that year to executive officers. The Compensation Committee, also at its regularly scheduled March meeting,this time, reviews performance against the plan provisions and associated expense implications of the annual incentive compensation amounts earned for the previous year, retaining discretion as to the final incentive compensation for subsequent approval. The Compensation Committee may set salary and grant cash incentive awards and equity awards for executive officers at other times to reflect promotions, new hires or other special circumstances.



Our Compensation Targets



We do not target a specific mix of pay for our executive officers. We set base salary, annual incentive and long-term incentive compensation opportunities and target total compensation annually, in light of our evaluation of competitive market factors. Concurrent with that process, we review pay levels for comparatorpeer company executives, and each executive officer’s performance and experience. This process provides guidepostsguidelines for establishing the mix of pay for our executives, in terms of short-term versus long-term compensation and in terms of cash versus equity compensation. As reflected in the following charts, long-term incentive compensation, which we typically grant in the form of performance-based equity awards, made up more than 56%64% of target total compensation for our CEO and more than 40% (on average)32% on average for our other NEOs in 2015. Overall2016. The annual and long-term performance-based incentive compensation (annual and long-term combined) made up more than 82%86% of our CEO’s target total compensation and more than 70% (on average)averaged 66% for our other NEOs target total compensation in 2015.2016. These significant percentages of pay “at risk” reinforce the alignment of our executive officers with our shareholders.



CEO ‐ BASE SALARY, ANNUAL INCENTIVE COMPENSATION (IC) AND LONGTERM INCENTIVE COMPENSATION (LTIC) AS A PERCENTAGE OF TARGET TOTAL COMPENSATION FOR 2016 14% Base Salary 22% Annual IC 64% LTIC

OTHER NEOs ‐ AVERAGE BASE SALARY, ANNUAL INCENTIVE COMPENSATION (IC) AND LONG‐TERM INCENTIVE COMPENSATION (LTIC) AS A PERCENTAGE OF TARGET TOTAL COMPENSATION FOR 2016 32% LTIC 34% Base Salary 34% Annual IC



We calculate target total compensation (base salary plus target annual incentivesbonus plus target annual long-term incentive value)compensation) for each of our executive officers to confirm that it is appropriate for the position and make adjustments where appropriate. We target executive officers’ total compensation to be highly competitive (generally in or near the upper quartile of total pay)quartile) relative to the companies in our comparator companies.peer group. Executive officers then have the potential through incentive compensation to earn actual total compensation at a level that can be well above or below the peer group median, depending upon performance. See page 2639 for a summary of how our actual total compensation in 20152016 compares to targeted parameters.



AccordingUnique Factors Play into our Executive Compensation Decisions and Practices

Since the 2008 merger that created Tutor Perini, Mr. Tutor has been a key driving force—both strategically and operationally—behind the Company’s growth and evolution into a stronger, vertically integrated and broader geographic player in the market. Mr. Tutor has transformed the Company from a firm primarily involved in lower-margin building work to data providedone that today boasts a broad nationwide footprint with a large component of higher-margin civil and specialty construction services. With all the recent focus on and public support for infrastructure spending, the one consistent area of agreement among politicians, we see an unprecedented level of current bidding activity for large civil projects and anticipate an even greater level of demand for our services over the next several years. Consequently, our growth over the next several years is expected to be driven by Equilar, a leading providersignificant volume of higher-margin civil project opportunities and a considerable volume of larger, complex building project opportunities. The Company’s uniquehistory and evolution, in particular the private company legacy of Tutor-Saliba Corp., a heavy civil and building construction company that Mr. Tutor owned, operated and grew over several decades, has had a substantial impact on the Company’s executive compensation data, target totalpractices.

Mr. Tutor’s value to the Company is significant and his level of compensation reflects, in part, his high retention value, which is particularly important today given the current environment of strong support for mostinfrastructure spending and the anticipated influx of large civil project opportunities over the next several years. Mr. Tutor has a high degree of direct involvement in strategic planning and decisions, and an extremely in-depth knowledge and involvement in many operational functions, from project selection and bidding decisions to day-to-day client relationship management and oversight of many of the Company’s largest projects. He also plays an instrumental role in navigating and negotiating the legal processes related to various disputes over our NEOsclaims, unapproved change orders and other matters. Mr. Tutor’s level of direct involvement in all of these functions is truly unique among CEOs in our industry. All of this factors highly in the Compensation Committee’s decision-making process and its views on the appropriateness of Mr. Tutor’s compensation.

Tutor Perini is a construction services company that competes with many other public and private companies for 2015 was belowprojects and for executive talent. Our closest competitors for projects are primarily large privately held firms or U.S. subsidiaries of foreign parent firms, whose focus and revenues stem largely from construction services and less from design and engineering services. In contrast, the median percentile on average,revenues of many of the larger publicly traded companies with which reflects relatively lowwe sometimes compete are primarily derived from consulting, design, architecture and engineering services, rather than construction services. Our Board and executive management have found through various succession planning activities that overall executive compensation forlevels at our NEOsprivately held and U.S. subsidiary competitors tend to be higher compared with compensation levels at our publicly traded peers. While Mr. Tutor’s compensation is higher than the compensation of CEOs at some of the Company’s public peers, it is also lower than the pay packages of several other CEOs in a yearour peer group. The Board believes Mr. Tutor’s compensation is comparable to the compensation of CEOs at non-public peers and knows that it is significantly lower than his compensation under the Company’s predecessor, Tutor-Saliba.

The construction markets in which the Company did not achieve its performance targets. An individual executive’s salary, annual incentive opportunityoperates are inherently cyclical and long-term incentive opportunity may be higher or lower relativedemand levels fluctuate significantly more than in the markets for consulting, engineering and design services. Throughout these cycles, we strive to ensure that our executive compensation program remains consistent with the competitive labor markets for executive talent, especially in comparison with the privately held and U.S. subsidiary peers with which we compete. The Compensation Committee considers, when available, private company compensation data and construction market dependingcyclicality and volatility as important factors when evaluating the Company’s executive compensation program. Because we believe the construction industry is at an inflection point with many significant new opportunities on the horizon, it is particularly important that we maintain a variety of factors specifichighly competitive executive compensation program to attract and retain the position or the incumbent.top talent needed to successfully capitalize on these future opportunities.



Peer Group Comparisons



The Compensation Committee reviews the Company’s peer group on an annual basis to ensure that it continues to be valid for analyzing and determining executive compensation for the Company. The peer group companies wereare selected based on various criteria considered by the Compensation Committee, including industry, revenue and market capitalization. As a result of this peer group review and evaluation, the Compensation Committee approved the Company’s 20152016 peer group (listed below) for its assessment of executive compensation in 2015.2016. This peer group (“2015 Peer Group”) is identical to the previously used 20142015 peer group. The Compensation Committee believes that this peer group with the exceptionrepresents an ideal, industry-focused group of three companies that were removed from the 2014 peer group because they have been acquired or have split into separate public companies. The 2015 Peer Group represents current companies with which Tutor Perini competes for projects and/orand executive talent. Furthermore, the Compensation Committee believes that this peer group provides a better representation of the competition that influences the Company’s compensation decisions compared to other peer groups selected and used by certain proxy advisory firms that consider peer companies across a wider spectrum of industries.

The Compensation Committee utilized compensation data for the subset of 12 public companies in the 2015 Peer Grouppeer group to assess the relative competitiveness of the compensation for the Company’s NEOs in 20152016 by reviewing market information on the 2015 Peer Grouppeer group NEOs’ base salaries, annual cash incentive compensation and long-term incentive compensation. In utilizing the Company’s 2016 peer group to calculate certain quantitative Pay-for-Performance metrics evaluated by proxy advisory firms, the Company determined that there is a low level of concern for each of those metrics.



The following table shows the companies included in the Company’s 2015 Peer Group:2016 peer group:



* Not a U.S. publicly tradedPrivately held company (i.e., either privately held or a U.S. subsidiary of a foreign parent company)company

Elements of Compensation



Our executive compensation program relies on annuala combination of cash and share-based compensation to retain and motivate our NEOs. In addition, the Compensation Committee has granted share-based long-term incentive awards when deemed appropriate by the Compensation Committee,NEOs based on strategic goals, superior performance and the value of the executive to the Company.



Base Salary



We provide market-competitive base salaries that are highly competitive in order to fairly compensate our NEOs for the services that they provide duringprovide. Salary levels are also established in consideration of the year and to assist in retaining our NEOs. The only change made in 2015value of the executive to the Company and as a means of retention. No changes to base salaries were made for any of our NEOs was for Mr. Frost, who, in February 2015 received a 25% increase in base salary (from $800,000 to $1,000,0000) concurrent with his promotion to the role of President and Chief Operating Officer.2016.



Annual Incentive Compensation Plan - Annual Awards



The Compensation Committee believes that providing meaningful cash-based incentivesperformance-based cash compensation provides executives with a  focusan incentive to achieve the Company’s strategic goals. To provide appropriate incentives to our current NEOs, 50% to 60% (depending on position) of their target annual cash compensation is comprised of an annual incentive bonus opportunity that is paid only if Tutor Perini achieves pre-established performance goals set by the Compensation Committee.



For 2015,2016, the Compensation Committee established a target annual bonus opportunity for each NEO, stated as a percentage of each NEO’s base salary. The annual bonus was only payable if Tutor Perini achieved financial performance goals established at the beginning of the performance period by the Compensation Committee. For 2015, if Tutor Perini achieved 80% of the target goal (the “Threshold” as shown in the table below), each NEO would receive 80% of his target annual bonus amount, except for Mr. Tutor, who would receive 100% of base salary as annual bonus. If Tutor Perini achieved between 80% and 100% of this goal, each NEO would receive between 80% and 100% of his target annual bonus amount, except for Mr. Tutor, who would receive between 100% and 150% of base salary as annual bonus. With the exception of Mr. Tutor, each NEO’s annual bonus was capped at 100% of his applicable target bonus. Mr. Tutor can earn an annual bonus of up to 215% of his base salary if the Company achieves 120% or more of the target goal. Mr. Smalley’s bonus opportunity for 2015 was prorated based on his September 1, 2015 employment date.

The table below shows the 2016 threshold, target and maximum bonus opportunities as a percentage of the executive’s base salary:



The dollar amounts corresponding to these percentages are included in the “Grants of Plan-Based Awards Table”Table in 2016” on page 3145.  



For 2015,2016, the Company and the Compensation Committee selected pre-tax income as the applicable performance metric for the annual bonus plan. The rationale for usingThis metric was chosen because pre-tax income centers uponis tracked closely at the fact that operating results in the construction industry are project-driven,project level and as a

result there may be fluctuations in earnings depending upon the cycle and mix of projects. However, the common goal in managingis very useful for measuring profitability across the Company’s operations is the maximization of pre-tax income, which best aligns with the goal of shareholder value creation. Furthermore,projects and business units. The Company and the Compensation Committee believesbelieve that a focus on pre-tax income maximization encourages executives to both obtain newperform projects for Tutor Perini and to complete Tutor Perini’s projects on a cost efficient basis. cost-efficiently, which promotes shareholder value creation over the long term.

The applicable targets set by the Compensation Committee and the actual performance as calculated based on the plan formula for 20152016 were as follows:



Annual Incentive Compensation – CashBonus Payouts for 20152016 Performance



The table below shows the actual incentive compensation (bonus) payouts for our NEOs based on their 20152016 performance relative to the above-referenced targets. As previously mentioned, none of our NEOs, except for Mr. Frost, wasThese bonuses were earned in 2016 and paid his bonus for 2015 because the applicable performance goals were not achieved. Mr. Frost did earn and was paid his bonus for 2015 because the Civil Group, for which he was directly responsible in 2015, achieved its performance target.March 2017.



Mr. Tutor’s, Mr. Kershaw’sSmalley’s and Mr. Smalley’s 2015Frost’s 2016 annual bonuses were based solely on the achievement of the consolidated pre-tax income target. Mr. Frost’s annual bonus was based on the achievement of the Civil Group target, and Mr. Shaw’s annual bonus was based on the achievement of the Building Group pre-tax income target. While the Building Group achieved its pre-tax income target, 50% of Mr. Shaw’s bonus was withheld pursuant to the quality of earnings metric (see Concern No. 18 on page 32), consistent with the Company’s efforts to improve operating cash flow.



Succession Planning Implementation Bonus2017 Performance Metrics for Annual Incentive Compensation



During 2015, Mr. Tutor was paidAs mentioned earlier, in two separate tranches a combined $3.75 million portion of his $5 million succession plan implementation bonus. The $5 million succession plan implementation bonus was approved in December 2014 byresponse to shareholder feedback, the Company and the Compensation Committee as part of Mr. Tutor’s amended employment agreement.are instituting new performance metrics for annual incentive compensation beginning in 2017. The pre-tax income metric will continue to be utilized (at a 50% weighting) and will be supplemented by the following new performance metrics: operating cash flow (30% weighting), safety (10%) and individual performance (10%). The operating cash flow metric was added in alignment with the Company’s intense focus on improving cash generation. The safety metric, based on the OSHA Recordable Incident Rate, was implemented to be in step with the Company’s goal to promote workplace safety and to reduce insurance-related costs. Finally, the individual performance metric was implemented to motivate and reward NEOs for their contributions to overall Company performance, cultural and operational improvements, and talent development and succession planning accomplishments.



Sign-onImproved Alignment between the CEO’s and Relocation-Related BonusesOther NEOs’ Annual Incentive Compensation Payouts



In additionAlso in response to the performance-based awards discussed above,shareholder feedback, beginning in 2017, the Compensation Committee approved a $250,000 signinghas improved the alignment between the CEO and other NEOs with respect to annual incentive compensation payout opportunities. Previously, through 2016, NEOs’ potential annual bonus for Mr. Smalley in September 2015 for his appointment to the rolepayouts were capped at 100% of Executive Vice President and Chief Financial Officer and to compensate him for incentives foregone from his previous employment by assuming this roletarget, except for the Company. The Compensation CommitteeCEO’s bonus, which was capped at approximately 143% of target. Going forward, NEOs other than the CEO will also approvedbe eligible for a $700,000 specialmaximum potential bonus for relocation-related payments to Mr. Smalley related to his move from Texas to California.payout that is above 100% of target. Maximum payouts that are above 100% of target can only occur in cases where performance is also above target.



Long-Term Incentives



Periodic awards of long-term incentives have played a significant role in our executive compensation program because of our long-held belief that due to the cyclical nature of our business, year-to-year annual incentives focus our executives on achieving Tutor Perini’s performance objectives.program. Historically, the Compensation Committee has made periodic equity awards to select key executives based upon Company strategic goals, executive performance and upon the value of the executive to the Company. Not all executives receive equity awards. During 2015, only2016, Mr. Tutor, Mr. Frost and Mr. FrostSmalley were granted equity awards. However, allassociated with awards approved in prior years as detailed in the “Grants of thePlan-Based Awards Table for 2016.” Mr. Tutor’s equity awards granted to Mr. Tutorgrants in 2016 included a 3-year relative-TSR-based equity grant that was approved for award in 2014 as part of his amended and Mr. Frost in 2015 were forfeited in December 2015 because the Company did not achieve the threshold consolidated performance target required for those equity awards to vest.restated employment agreement.



The Company and the Compensation Committee hashave historically used pre-tax income as the annual performance goalmetric for performance-basedlong-term equity awards and, asawards. As mentioned above, the rationale for using pre-tax income centers upon the fact that operating resultsits value in the construction industry are project-driven, and as a result there may be fluctuations in earnings depending upon the cycle and mix of projects. The common goal in managingmeasuring profitability across the Company’s operations is the maximization of pre-tax income, which best aligns with the goal of shareholder value creation. As mentioned above,projects and business units. Furthermore, the Compensation Committee believes that a focus on pre-tax income maximization encourages executives to both obtain newperform projects for Tutor Perini and to complete Tutor Perini’s projects on a cost-efficient basis. Typically,cost-efficiently, which promotes long-term shareholder value creation. Historically, long-term equity is awardedawards have been made to certain executives subject to the achievement of annual performance measures. Accordingly, thetargets.

The Compensation Committee selected pre-tax income as the performance measure for the equity awards granted in 2015.

Equity Grants Made to Mr. Tutor and Mr. Frost in 2015

Under2016. Mr. Tutor’s 2012Smalley’s 2016 equity award agreement, as amended, in March 2015 the Company granted to Mr. Tutor 150,000 restricted stock units (RSUs) and 150,000 stock options, the vesting of whichgrant, however, was based on achieving a consolidated 2015 pre-tax income performance target set by the Compensation Committee. As previously mentioned, all of these RSUs and stock options were forfeited in December 2015 because the performance target was not achieved.diluted earnings per share (diluted EPS) target.



Equity Grants MadeAs discussed earlier on page 32, in response to Mr. Frostshareholder feedback and requests for the use of metrics in 2015

In March 2015, addition to pre-tax income, as well as shareholder preference for the use of a relative-return-based metric over a longer performance period, the Company awarded and granted to Mr. Frost 100,000 RSUs and 100,000 stock options, the vesting of which was based on achieving a consolidated 2015 pre-tax income performance target set by the Compensation Committee. As mentioned above, allCommittee are implementing new performance metrics for long-term incentive compensation awards, beginning with awards made to NEOs in 2017 (none to date). The Company will no longer use a one-year performance period for long-term incentive awards. Instead, it plans to implement the use of these RSUs and stock options were forfeited in December 2015 becauseone or more relative-return-based metrics, such as 3-year TSR relative to the performance target was not achieved.Company’s publicly traded peers.

Equity Awards Made to Mr. Smalley in 2015

In September 2015, the Company awarded 45,000 RSUs and 45,000 stock options to Mr. Smalley in connection with the commencement of his employment, which will be granted in tranches from 2016 through 2018.

Equity Compensation Plan Information for 2015



Retirement Benefits



Tutor Perini does not provide additional retirement benefits to executive officers beyond what is offered to all employees.



Perquisites



We provide certain perquisites to our executives because of the demand in time and travel, as well as security and productivity factors, required in their leadership across multiple businesses in multiple geographic locations. The perquisites afforded to each of our NEOs may