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FLUOR CORPORATION
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
Fluor Daniel International and Fluor Arabia Ltd. v. General Electric Company, et al
In October 1998, Fluor Daniel International and Fluor Arabia Ltd. filed a complaint in the United
States District Court for the Southern District of New York against General Electric Company and certain
operating subsidiaries as well as Saudi American General Electric (‘‘SAMGE’’), a Saudi Arabian
corporation. The complaint sought damages in connection with the procurement, engineering and
construction of the Rabigh Combined Cycle Power Plant in Saudi Arabia. On April 10, 2007, the
arbitration panel issued a partial final award stipulating the amount of entitlement to recovery of certain
claims and awarding interest on the net amounts due to Fluor. A final award on the calculation of interest
due to Fluor has been received. All amounts have been collected except for post-award, pre-judgment
interest of approximately $1 million and a retention receivable of $9 million to be paid by SAMGE after it
receives payment from the owner. In the fourth quarter of 2008, a provision was recognized for the full
amount of the unpaid retention receivable as the result of a re-assessment by the company of the
likelihood that SAMGE would ever receive payment from the owner.
Asbestos Matters
The company is a defendant in various lawsuits wherein plaintiffs allege exposure to asbestos fibers
and dust due to work that the company may have performed at various locations. The company has
substantial third party insurance coverage to cover a significant portion of existing and any potential cost,
settlements or judgments. No material provision has been made for any present or future claims and the
company does not believe that the outcome of any actions will have a material adverse impact on its
financial position, results of operations or cash flows. The company has resolved a number of cases to date,
which in the aggregate have not had a material adverse impact.
Conex International v. Fluor Enterprises, Inc.
In November 2006, a Jefferson County, Texas, jury reached an unexpected verdict in the case of Conex
International (‘‘Conex’’) v. Fluor Enterprises Inc. (‘‘FEI’’), ruling in favor of Conex and awarded
$99 million in damages related to a 2001 construction project.
In 2001, Atofina (now part of Total Petrochemicals Inc.) hired Conex International to be the
mechanical contractor on a project at Atofina’s refinery in Port Arthur, Texas. FEI was also hired to
provide certain engineering advice to Atofina on the project. There was no contract between Conex and
FEI. Later in 2001 after the project was complete, Conex and Atofina negotiated a final settlement for
extra work on the project. Conex sued FEI in September 2003 alleging damages for interference and
misrepresentation and demanding that FEI should pay Conex the balance of the extra work charges that
Atofina did not pay in the settlement. Conex also asserted that FEI interfered with Conex’s contract and
business relationship with Atofina. The jury verdict awarded damages for the extra work and the alleged
interference.
The company appealed the decision and the judgment against the company was reversed in its entirety
in December 2008 and remanded for a new trial.
Fluor Corporation v. Citadel Equity Fund Ltd.
Citadel Equity Fund Ltd., a hedge fund and investor in the company’s 1.5 percent Convertible Senior
Notes (the ‘‘Notes’’), and the company are disputing the calculation of the number of shares of the
company’s common stock that were due to Citadel upon conversion of approximately $58 million of Notes.
Citadel argues that it is entitled to an additional $28 million in value under its proposed calculation
method. The company believes that the payout given to Citadel was proper and correct and that Citadel’s
claims are without merit. The company is vigorously defending its position.
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