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UNITED STATES SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

FORM 10-K/A

Amendment No. 1

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

For the fiscal year ended December 31, 2016

Commission file number 001-33961

HILL INTERNATIONAL, INC.

(Exact name of registrant as specified in its charter)

Registrant’s telephone number, including area code: (215) 309-7700

Securities registered pursuant to Section 12(b) of the Act:

Securities registered pursuant to Section 12(g) of the Exchange Act: None

Indicate by a check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act. Yes o No x

Indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or Section 15(d) of the Act. Yes o No x

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

Indicate by a check mark whether the registrant has submitted electronically and posted on its corporate website, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§229.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files). Yes x No o

Indicate by a check mark if disclosure of delinquent filers pursuant to Item 405 of Regulation S-K is not contained herein, and will not be contained, to the best of registrant’s knowledge in definitive proxy or information statements incorporated by reference in Part III of this Form 10-K or any amendment to this Form 10-K. o

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

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

Emerging growth company    o

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.    o

The aggregate market value of shares of common stock held by non-affiliates on June 30, 2015 was approximately $203,536,000. As of March 9, 2016, there were 51,701,442 shares of the Registrant’s Common Stock outstanding.

Documents Incorporated by Reference

None.

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HILL INTERNATIONAL, INC. AND SUBSIDIARIES

Index to Form 10-K/A

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EXPLANATORY NOTE

Hill International, Inc. (the “Company”) is filing this Amendment No. 1 to its Annual Report on Form 10-K for the fiscal year ended December 31, 2016, as originally filed with the Securities and Exchange Commission (“SEC”) on March 31, 2017 (the “Original Form 10-K”), to add information required in Part III of its Annual Report on Form 10-K because a definitive proxy statement containing such information will not be filed within 120 days after the end of the fiscal year covered by the Form 10-K. The reference on the cover of the Original Form 10-K to the incorporation by reference to portions of its definitive proxy statement into Part III of the Original Form 10-K is hereby deleted. In addition, Item 15(b) of Part IV is being amended solely to add as exhibits 31.3 and 31.4 new certifications in accordance with Rule 13a-14(a) promulgated by the SEC under the Securities Exchange Act of 1934.

Except as described above, no other changes have been made to the Original Form 10-K. This Amendment No. 1 continues to speak as of the date of the Original Form 10-K and the Company has not updated the disclosure herein to reflect any events that occurred at a later date other than as expressly stated herein. Accordingly, this Amendment No. 1 should be read in conjunction with the Original Form 10-K and with the Company’s filings made with the SEC subsequent to the filing of the Original Form 10-K.

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Part III

Item 10. Directors, Executive Officers and Corporate Governance

The information under the heading “Executive Officers” in Part I, Item 1 of the Original Form 10-K is incorporated by reference into this Item 10.

DIRECTORS

Our Directors are as follows:

CAMILLE S. ANDREWS has been a director since June 2009.  Since 1998, Ms. Andrews has been an Associate Dean, and since 1996 a member of the faculty, of Rutgers University School of Law at Camden.  From 2007 to 2015, Ms. Andrews served as Counsel to Context Capital Partners, a private equity firm.  Between 1986 and 1996, Ms. Andrews was a Partner with the law firm of Dilworth Paxson LLP, and between 2006 and 2008, she was Of Counsel to that firm, with expertise in antitrust, securities, class actions, derivative and shareholder suits, and other complex litigation matters.  Ms. Andrews earned a B.A. magna cum laude in rhetoric and communication from the University of Pittsburgh and a J.D. with honors from Rutgers University School of Law at Camden, where she served on the Law Review.  She was a member of the Board of Trustees for the Leap Academy Charter School in Camden, NJ from 2000 to 2007 and has served on a number of charitable boards, including the Walnut Street Theater, ACYO Charitable Foundation (a subsidiary of The Goldman Sachs Group, Inc.), New Jersey Child Cares, and the Philadelphia Zoo Chairman’s Council.  She has also served on the New Jersey Supreme Court Committee on Judicial Education.  Ms. Andrews is admitted to practice law in New Jersey, Pennsylvania and before the U.S. Supreme Court.  Ms. Andrews offers a wealth of legal expertise in commercial matters and her service on the boards of other organizations provides cross-board experience.  Age:  57.

BRIAN W. CLYMER has been a director since June 2006.  Mr. Clymer retired from Prudential Financial, Inc. where he was Senior Vice President of External Affairs from July 1997 to January 2013.  Prior to Prudential, he served as New Jersey State Treasurer under Governor Christine Todd Whitman from 1994 to 1997.  Prior to that, Mr. Clymer was President and Chief Executive Officer of Railway System Design, Inc. and Vice President of its parent company, Gannett Fleming, Inc., an engineering design firm, from 1993 to 1994.  From 1989 to 1993, he served under President George H.W. Bush as Administrator of the U.S. Federal Transit Administration.  Mr. Clymer has served on numerous Boards of Directors, including the New Jersey Sports and Exposition Authority, the New Jersey Casino Reinvestment Development Authority, the New Jersey Performing Arts Center, the Southeastern Pennsylvania Transportation Authority, the American Public Transit Association, Security First Bank, and Motor Coach Industries International, Inc., then a New York Stock Exchange-listed designer and manufacturer of buses and coaches.  He also served on the Board of Directors of the New Jersey Alliance for Action from 1997 to 2014 and currently serves on the Board of the Independent College Fund of New Jersey as past Chairman.  Mr. Clymer earned his B.S. in business and economics from Lehigh University and holds an honorary doctorate from Drexel University.  He is a Certified Public Accountant in the Commonwealth of Pennsylvania.  Mr. Clymer has spent almost 20 years in the field of public accounting and brings extensive experience as an executive and board member of various publicly and non-publicly held entities and offers deep knowledge of financial, economic and accounting matters.  Age:  70.

STEVEN R. CURTS has been a director since October 2015.  Since May 2014, he has been the Chief Strategy Officer and, since November 2016, he has been the Interim Chief Information Officer for American Express Global Business Travel.  Prior to that, he was a Vice President with Dell, Inc. from November 2009 to December 2013.  Before that, he worked for 20 years with Perot Systems Corp. in numerous roles, including President of its Commercial Solutions Group, Vice President of Corporate Planning and Financial Operations, and Vice President of Finance.  Mr. Curts received his B.B.A in accounting from Southern Methodist University.  Among other things, Mr. Curts brings experience as a senior finance leader with executive roles encompassing financial operations, business development, treasury and corporate planning.  Age: 56

PAUL J. EVANS has been a director since August 2016.  From 2012-2015 Mr. Evans served as Vice President, Chief Financial Officer and Treasurer of MYR Group, and President of MYR Real Estate Company.  From 2010-2011, Mr. Evans was Chief Executive Officer of Conex Energy Corporation, a privately-held company that

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developed renewable energy projects.  From 2002-2009 he served as Treasurer and Corporate Officer of NorthWestern Energy, a multi-state utility that provides electricity and natural gas.  Prior to NorthWestern Energy, Mr. Evans held corporate operational finance positions at Duke Energy North America, NRG Energy, and McLane Company, Inc.  Mr. Evans is a Certified Public Accountant and holds a B.B.A. in Accounting from Stephen F. Austin State University and Masters of International Management from Thunderbird School of Global Management.  Age: 49.

ALAN S. FELLHEIMER has been a director since June 2006.  He has been Chairman of the Philadelphia law firm of Fellheimer & Eichen LLP since January 2006.  He was Chairman of the Board of the Pennsylvania Business Bank, a state-chartered bank, from 1998, when he founded the bank, until 2008 when the bank was sold.  He also served as the bank’s President and Chief Executive Officer from 1998 until 2006.  From 1991 to 1998, Mr. Fellheimer was a Partner in the Philadelphia law firm of Fellheimer Eichen Braverman & Kaskey.  During 1990, he was a Partner with the Philadelphia law firm of Spector Gadon & Rosen, P.C.  From 1985 to 1990, Mr. Fellheimer was Chairman and Chief Executive Officer of Equimark Corp., then a New York Stock Exchange-listed bank holding company.  He currently serves as a member of the Board of Trustees and Executive Committee of Gratz College, an emeritus member of the Board of Trustees of the Pennsylvania Ballet, a member of the President’s Advisory Board of Temple University and a member of the Dean’s Advisory Board of the School of Social Policy & Practice of the University of Pennsylvania.  Mr. Fellheimer is a Trustee of the Law Foundation of Temple University and a Past Master, Past High Priest and Trustee of the Grand Lodge of Pennsylvania, AF&AM.  Mr. Fellheimer earned his A.B. in liberal arts and his J.D. summa cum laude from Temple University.  He is a member of the New Jersey, New York and Pennsylvania bars.  Mr. Fellheimer has significant banking expertise and brings to the Company experience in leadership positions with public and non-public entities.  Age:  74

RAOUF S. GHALI has been our President and a member of our board since August 2016 and our Chief Operating Officer since January 2015.  Prior to that, he was President of our Project Management Group (International) from January 2005 to January 2015, Senior Vice President in charge of project management operations in Europe, North Africa and the Middle East from 2001 to 2004, and Vice President from 1993 to 2001.  Prior to joining us, he worked for Walt Disney Imagineering from 1988 to 1993.  Mr. Ghali earned both a B.S. in business administration and economics and an M.S. in business organizational management from the University of LaVerne.  Age:  55.

CHARLES M. GILLMAN has been a director since August 2016.  Mr. Gillman has been the owner and Executive Managing Director of IDWR Multifamily Investment Office since 2013.  From 2001-2013 he served as a Portfolio Manager for Nadel and Gussman, a holding company with a number of business interests.  He currently serves on the Board of the following public companies: Digirad Corporation,  Novation Companies,  Solitron, and Points International.  Previously, he served on the Board of the following public companies:  Aetrium, Inc., InfuSystem Holdings, Inc., PMFG Inc., On Track Innovations Ltd., MRV Communications Inc., Littlefield, Hooper Holmes, and Compumed Inc.  Age: 46.

CRAIG L. MARTIN  has been our Executive Chairman since May 1, 2017, our Chairman since October 2016 and a director since February 2016.  In December 2014, Mr. Jacobs retired as the President and Chief Executive Officer of Jacobs Engineering Group, Inc.  He became President in July 2002 and Chief Executive in April 2006.  He also served as a member of Jacobs’ Board of Directors from 2002 until his retirement. Prior to July 2002, he served in several positions, most recently as Executive Vice President of Global Sales and Marketing.  Before joining Jacobs in 1994, he worked in various roles at CRSS International Inc. and Martin K. Eby Construction Co.  He received his B.S. in civil engineering from the University of Kansas and his M.B.A. from the University of Denver.  Mr. Martin has nearly 45 years of experience in the international engineering and construction industry.  Age:  67.

DAVID L. RICHTER has been our Chief Executive Officer since December 2014 and he has been a member of our Board of Directors since 1998. Prior to his current position, he was our President and Chief Operating Officer from March 2004 to December 2014. Before that, Mr. Richter was President of our Project Management Group from 2001 to 2004, Senior Vice President and General Counsel from 1999 to 2001 and Vice President and General Counsel from 1995 to 1999. Prior to joining us, he was an attorney with the New York City law firm of Weil, Gotshal & Manges LLP from 1992 to 1995. Mr. Richter is a Fellow of both the Construction Management Association of America (CMAA) and the Chartered Institute of Building. He is a member of the World Presidents’ Organization, the Construction Industry Round Table and the American Society of Civil Engineers. He is a member of the Board of Directors of the Greater Philadelphia Chamber of Commerce and the Board of Trustees of Princeton

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Day School. He is a former member of the Board of Directors of the CMAA and the Board of Trustees of the Southern New Jersey Development Council. Mr. Richter earned his B.S. in management, his B.S.E. in civil engineering and his J.D. from the University of Pennsylvania and his M.Sc. in major program management from the University of Oxford. Mr. Richter is a son of Irvin E. Richter. Mr. Richter has more than two decades of executive leadership with the Company and has developed great expertise in the construction management industry. Age: 49.

DAVID SGRO has been a director since August 2016. Mr. Sgro is a Senior Managing Director of Crescendo Partners, L.P. and has held various positions at Crescendo Partners since May 2005. He is also a Managing Member and Head of Research for Jamarant Capital, a private investment fund. Mr. Sgro also serves as an officer and is a former director of Harmony Merger Corp. (NASDAQ:HRMN), a Special Purpose Acquisition Company. Mr. Sgro has been a director and chairman of the audit committee of and Pangaea Logistics Solutions Ltd. (NASDAQ:PANL), a provider of seaborne dry bulk transportation services to industrial customers, since October 2014; a director and chairman of the audit committee of BSM Technologies Inc,. a provider of GPS fleet and asset management solutions, since June 2016; and a director of Imvescor Restaurant Group Inc., a restaurant franchise and licensing company, since March 2016. He has also been a director, and chairman of the audit committee, of ComDev International, a TSX listed designer and manufacturer of space hardware subsystems, from April 2013 to February 2016; a director, and chairman of the audit committee, of SAExploration Holdings, Inc. (NASDAQ:SAEX), a provider of seismic data services to the oil and gas industries, from June 2013 to July 2016; a director of Bridgewater Systems, Inc., a TSX listed telecommunications software company, from June 2008 to August 2011; and a director of Primoris Services Corporation (NASDAQ:PRIM), a specialty construction company, from July 2008 to May 2011. Mr. Sgro also served as an officer and director of Quartet Merger Corp., from October 2013 until its merger with Pangaea Logistics Solutions Ltd. in October 2014, and as an officer and director of Trio Merger Corp., from March 2011 until its merger with SAExploration Holdings in June 2013. Prior to joining Crescendo Partners, Mr. Sgro held analyst positions with Management Planning, Inc. and MPI Securities, Inc. Mr. Sgro is a Chartered Financial Analyst (CFA) Charterholder and holds a B.S. in Finance from The College of New Jersey and an M.B.A. from Columbia Business School. Age: 40.

SECTION 16(a) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE

Section 16(a) of the Exchange Act requires our directors and executive officers and persons who beneficially own more than 10% of our common stock to file initial reports of ownership and changes in ownership with the SEC.  To the Company’s knowledge based on a review of copies of such reports furnished to Hill and on written representations made by such persons, all of the Company’s directors, executive officers and beneficial owners of more than 10% of our common stock have complied with all Section 16(a) filing requirements with respect to 2016 except that, due to administrative oversights, required Form 4 reports were not filed on a timely basis on behalf of the following persons:  Steven R. Curts (1 transaction), Craig L. Martin (1 transaction), Mohammed Al Rais (1 transaction) and Irvin E. Richter (1 transaction).

CODE OF ETHICS

All directors, officers and employees of the Company are expected to act ethically at all times and in accordance with the policies comprising Hill’s Code of Ethics and Business Conduct (the “Code”) which is available on our website at www.hillintl.com, in the “Investor Relations” section, and is available in print to any stockholder upon request.  Any waiver or any implicit waiver from a provision of the Code applicable to Hill’s chief executive officer, chief financial officer, chief accounting officer or controller, or any amendment to the Code must be approved by the Board.  We will disclose on our website amendments to, and, if any are granted, any such waiver of, the Code. Hill’s Audit Committee is responsible for applying the Code to specific situations in which questions are presented to it and has the authority to interpret the Code in any particular situation.  If, after investigating any potential breach of the Code reported to it, the Audit Committee determines (by majority decision) that a breach has occurred, it will inform the Board of Directors.  Upon being notified that a breach has occurred, the Board (by majority decision) will take or authorize such disciplinary or preventive action as it deems appropriate, after consultation with the Audit Committee and/or the Company’s General Counsel, up to and including dismissal or, in the event of criminal or other serious violations of law, notification of the SEC or other appropriate law enforcement authorities.

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CORPORATE GOVERNANCE

Pursuant to the Delaware General Corporation Law and the Company’s Amended and Restated Bylaws, the Company’s business, property and affairs are managed by or under the direction of the Board of Directors.  Members of the Board are kept informed of the Company’s business through discussions with the Chief Executive Officer and other officers, by reviewing materials provided to them and by participating in meetings of the Board and its committees.  We currently have ten members on our Board.

During 2016, the Board held nineteen meetings and the committees held a total of twenty-four meetings.  Each director attended more than 75% of the total number of meetings of the Board of Directors and the Board committees of which he or she was a member during the period he or she served as a director in 2016.  Although we do not have a policy requiring all directors to attend annual meetings of stockholders, we expect all directors to attend, absent extenuating circumstances. Last year, our 2016 Annual Meeting of Stockholders was postponed but was later recognized to have convened by the Delaware Court of Chancery; accordingly, our directors did not attend our 2016 Annual Meeting of Stockholders.

Board Leadership Structure

Our Amended and Restated Bylaws provide that we will have a Chairman who will chair Board meetings and perform such other duties as set forth in our Amended and Restated Bylaws or as otherwise assigned to him by our Board.  The Chairman and Chief Executive Officer may be the same person; however, our Board may separate these two positions if it deems it to be in the best interests of our Company and our stockholders to do so.  Presently, the Chairman and Chief Executive Officer positions are held by two different individuals.  On October 6, 2016, Mr. Craig L. Martin was appointed as Chairman.  Considering the independence of the Chairman (discussed in the section titled “Director Independence” in Item 13 below), the Board of Directors amended the Company’s bylaws on November 3, 2016 to remove provisions with respect to a lead independent director.

Role of the Board in Risk Oversight

The Board as a whole has responsibility for risk oversight, with reviews of certain areas conducted by relevant Board committees that report on their findings to the Board.  The oversight responsibility of the Board and the Board committees is facilitated by management reporting processes designed to provide information to the Board concerning the identification, assessment and management of critical risks and management’s risk mitigation strategies and practices.  These areas of focus include operational, economic, competitive, financial (including accounting, reporting, credit, liquidity and tax), legal, regulatory, compliance, environmental, political and strategic risks.  The full Board (or the appropriate Board committee), in concert with the appropriate management within the Company, reviews management reports to formulate risk identification, risk management and risk mitigation strategies.  When a Board committee initially reviews management reports, the Chairman of the relevant Board committee briefs the full Board on the specifics of the matter at the next Board meeting.  This process enables the Board to coordinate the risk oversight role, particularly with respect to risks spanning more than one operational area.  The Compensation Committee reviews compensation policies to ensure that they do not, among other things, encourage unnecessary or excessive risk-taking.

Corporate Governance Guidelines

The Corporate Governance Guidelines adopted by the Board, which include guidelines for determining director independence, are published on the Company’s website at www.hillintl.com, in the “Investors” section, and are available in print to any stockholder upon request.  That section of the website makes available the Company’s corporate governance materials, including Board committee charters.  Those materials are also available in print to any stockholder upon request.

COMMITTEES OF THE BOARD OF DIRECTORS

During 2016, the Board had standing Audit, Compensation, and Governance and Nominating Committees.  All members of each committee have been determined by the Board of Directors to be “independent” under applicable NYSE rules.  In addition, the Board has determined that each member of the Audit Committee meets SEC independence requirements which require that members of the Audit Committee may not accept directly or

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indirectly any consulting, advisory or other compensatory fee from Hill or any of its subsidiaries other than their directors’ compensation.  The charter of each committee is available on our website at www.hillintl.com, in the “Investors” section.

Audit Committee

The Audit Committee consists of Brian W. Clymer (Chair), Paul J. Evans and Alan S. Fellheimer.  The Board has determined that each member of the Audit Committee is financially literate.  The Board has also determined that Brian W. Clymer possesses accounting or related financial management expertise within the meaning of the NYSE listing standards and qualifies as an “audit committee financial expert,” as defined by the rules of the SEC.

The Audit Committee assists the Board in fulfilling its oversight responsibilities by (a) reviewing the financial reports and other financial information provided by Hill to its stockholders, the SEC and others, (b) monitoring the Company’s financial reporting processes and internal control systems, (c) retaining Hill’s independent registered public accounting firm, (d) overseeing the Company’s independent registered public accounting firm and internal auditors and (e) monitoring the Company’s compliance with its ethics policies and with applicable legal and regulatory requirements.  The Audit Committee also reviews and approves any transactions between Hill and any related parties.  During 2016, the Audit Committee met eight times.  The Audit Committee has been established in accordance with Section 3(a)(58)(A) of the Securities Exchange Act of 1934 (as amended, the “Exchange Act”).

Compensation Committee

The Compensation Committee consists of Steven R. Curts (Chair), Paul J. Evans and David Sgro.  Each member of the Compensation Committee is a “non-employee director” as defined in Rule 16b-3 of the Exchange Act and an “outside director” for purposes of Section 162(m) of the Internal Revenue Code of 1986, as amended (the “Code”).

The Compensation Committee oversees Hill’s executive compensation programs.  The Compensation Committee reviews and recommends to the Board for approval the compensation arrangements for all of the Company’s executive officers.  During 2016, the Compensation Committee met thirteen times.  The processes of the Compensation Committee are described below in “Compensation Discussion & Analysis.”

Governance and Nominating Committee

The Governance and Nominating Committee consists of Camille S. Andrews (Chair), Charles M. Gillman and David Sgro.  The Governance and Nominating Committee oversees matters relating to the evaluation and recommendation to the Board of the persons to be nominated for election as directors at any meeting of stockholders, and the persons to be appointed by the Board to fill any vacancy on the Board.

The Governance and Nominating Committee is responsible for reviewing and assessing with the Board the appropriate skills, experience, and background sought of Board members in the context of our business and the then-current membership on the Board.  This assessment includes a consideration of independence, diversity, age, skills, experience, and industry backgrounds in the context of the needs of the Board and the Company, as well as the ability of current and prospective directors to devote sufficient time to performing their duties in an effective manner.  Although the Company does not have a formal policy with respect to diversity standards, as a matter of practice, the Governance and Nominating Committee considers matters commonly viewed as matters of diversity in the context of the Board as a whole and, in its effort to select a Board that it believes will best serve the interests of the Company and its stockholders, takes into account the personal characteristics and experience of current and prospective directors to facilitate Board deliberations that reflect a broad range of perspectives.

The Governance and Nominating Committee carefully considers all director candidates recommended by our stockholders, and the Governance and Nominating Committee does not and will not evaluate such candidate recommendations any differently from the way it evaluates other candidates.  The Company’s Bylaws set forth minimum qualifications for an individual to serve as a director on the Company.  These minimum qualifications provide that no person shall qualify for service or serve as a director of the Company: (a) unless such person is in compliance with all applicable laws and regulatory requirements to which the Company’s directors may be subject

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in connection with such person’s service as a director, (b) if such person has been convicted in, or entered a plea of nolo contendere with respect to, a criminal proceeding involving fraud, misappropriation or other similar charge during the ten years preceding the date of election, or if such person has been found responsible for or admitted responsibility for fraud, misappropriation or other similar charge in any governmental investigation or proceeding or other civil judicial proceeding during the ten years preceding the date of election, or if such person has been found responsible for or admitted responsibility for any material violation of any foreign, federal or state securities law or federal commodities law during the ten years preceding the date of election, (c) if such person has been convicted of, or entered a plea of nolo contendere with respect to, any felony, (d) if such person serves on the board of directors of more than three other public companies, (e) if such person is a director, officer or holder of more than a five percent (5%) equity interest, directly or indirectly, in a business that competes, directly or indirectly, with the Company, (f) if such person has made or makes any contribution or expenditure in connection with the election of any candidate for political office, including any contribution to any committee supporting such a candidate or to a political party, in any jurisdiction which results in the Company becoming ineligible to conduct its business or any portion thereof, or (g) if such person has ever been the subject of a filing of personal bankruptcy in any jurisdiction, either voluntarily or involuntarily (and in the case of an involuntary filing, if such filing was not dismissed within 60 days) during the ten years preceding the applicable date of election.

Any stockholder who wishes to recommend an individual as a potential nominee for election to the Board should submit such recommendation in writing by mail to Hill International, Inc., One Commerce Square, 2005 Market Street, 17th Floor, Philadelphia, Pennsylvania 19103, Attn:  Chair of Governance and Nominating Committee, together with information regarding the experience, education and general background of the individual and a statement as to why the stockholder believes such individual to be an appropriate candidate for the Board of Directors of Hill.  Such recommendation should be provided to Hill no later than the close of business on the 120th day prior to the one-year anniversary of the date the Company’s proxy statement was released to stockholders in connection with the previous year’s annual meeting.  During 2016, the Governance and Nominating Committee held three meetings.

Majority Voting in Uncontested Elections of Directors

Last year, our Board recommended and the stockholders approved the adoption of majority voting for uncontested elections of directors.  Plurality voting continues to apply in contested elections. A contested election is one in which the number of nominees exceeds the number of directors to be elected, and other conditions are met. In an uncontested election, nominees will be elected directors if they receive a majority of the votes cast (i.e., the number of shares voted “for” a director must exceed the number of votes cast “withheld” from that director, without counting abstentions or broker non-votes); if a nominee is an incumbent director but is not elected, such director is required to tender his or her resignation to the Board promptly following the date of the certification of the election results. The Nominating and Governance Committee shall make a recommendation to the Board as to whether to accept or reject the tendered resignation, or whether other action should be taken. The Board shall act on the tendered resignation, taking into account the Nominating and Governance Committee’s recommendation, and publicly disclose (by press release, filing with the SEC or other manner reasonably calculated to inform stockholders) its decision regarding the tendered resignation and the rationale behind the decision within 90 days from the date of the certification of the election results. In a contested election, the nominees who receive a plurality of the votes cast (i.e., more votes in favor of their election than other nominees) will be elected directors

Communicating Concerns to Directors

The Company encourages all interested persons to communicate any concern that an officer, employee, director or representative of Hill may have engaged in illegal, dishonest or fraudulent activity, or may have violated Hill’s Code of Ethics and Business Conduct.  Such persons may report their concerns or other communications including suggestions or comments to the Board in one of the following ways:  by mail sent to William H. Dengler, Jr., Corporate Secretary, at the Company’s principal executive office:  One Commerce Square, 2005 Market Street, 17th Floor, Philadelphia, Pennsylvania 19103; by telephone at (866) 352-2792; or by email addressed to hil@openboard.info.  All such communications will be referred to Mr. Dengler who will circulate them to the members of the Board, or in the case of potential violations of the Code of Ethics and Business Conduct, to the Chairman of the Audit Committee.  If the communication is directed to a particular director, Mr. Dengler will forward the communication to that director.  The Board does not screen stockholder communications.

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Involvement in Certain Legal Proceedings

Charles M. Gillman is subject to an SEC administrative order, dated February 14, 2017 (Securities Exchange Act Release No. 80038), relating to alleged violations of Section 13(d) of the Securities Exchange Act of 1934 (the “Exchange Act”) and the rules promulgated thereunder, including failing to disclose the members of a stockholder group, and further allegations that Mr. Gillman violated Section 16(a) of the Exchange Act and the rules promulgated thereunder, including failing to timely file initial statements of beneficial ownership on Form 3 and changes thereto on Form 4. Without admitting or denying any violations, Mr. Gillman agreed to cease and desist from committing or causing any violations of (i) Section 13(d) of the Exchange Act and Rules 13d-1 and 13d-2 promulgated thereunder and (ii) Section 16(a) of the Exchange Act and Rules 16a-2 and 16a-3 promulgated thereunder, and paid a $30,000 civil penalty to the SEC.

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Item 11. Executive Compensation.

Executive Summary

Our Compensation Philosophy and Guiding Principles

In support of our business and our long-term success, the Company’s compensation program is designed to attract, motivate, reward and retain high-quality executives necessary to continually improve financial performance, achieve profitable growth and enhance stockholder value. To that end, our Compensation Committee (the “Committee”) has developed a compensation philosophy designed to reflect the following principles:

·                  There should be a strong link between pay and performance;

·                  The interests of our executives should be aligned with those of our stockholders; and

·                  Compensation programs should reinforce our business strategy, focus the executive team on priorities and ultimately drive growth in stockholder value.

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2016 Performance-Based Bonuses (Cash)

In 2016, we adopted Annual Incentive Awards for our CEO and our President and COO entirely based on achieving superior EPS results for the year with target annual incentive awards of $1,050,000 and $300,000, respectively.  Target EPS performance was set at a premium over the 2016 operating budget and in excess of the prior year’s actual EPS results.  The overall performance/payout range for 2016 was set as follows:

For our other NEOs, we set target annual incentive awards equal to 20% to 25% of total salary for each executive officer.  The overall performance/payout relationship for other named executive officers is the same as for our CEO and our President and COO as shown in the table above.

For 2016, we set a challenging target EPS of $0.30 per share, with a threshold of $0.24 per share.  We fell short of the threshold and, consistent with our pay-for-performance philosophy, no bonuses were earned or paid to our NEOs related to 2016 performance.

2016 Long-Term Incentive Awards (Equity)

The 2016 Long-Term Incentive Awards to our CEO and our President and COO were in the form of “Premium Priced” stock options.

·                  CEO:  granted 250,000 stock options with a premium exercise price of $4.00 and 250,000 options with a premium exercise price of $5.00, representing 22.3% and 52.9% premiums, respectively, over the $3.27 closing price of our common stock on the date of grant.

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·                  President and COO:  granted 250,000 stock options with a premium exercise price of $4.00, representing a 22.3% premium over the $3.27 closing price of our common stock on the date of grant.

Other named executive officers: granted stock options for between 25,000 to 75,000 shares with half of the options having an exercise price of $4.31, representing the closing price of our common stock on the date of grant, and half of the options having a premium exercise price of $5.17, representing a 20% premium over the closing price of our common stock on the date of grant.

We awarded the options described above to our CEO and our President and COO on April 1, 2016 and to our other NEOs on June 13, 2016.

2016 Compensation Governance Practices

We are committed to executive compensation practices that drive performance and that align the interests of our leadership team with the interests of our stockholders. We have implemented many best practices with respect to the compensation of our NEOs including:

1.                                      A significant portion of our executives’ target compensation opportunity is related to short- and longer-term performance based upon and tied to pre-established performance goals and the performance of our share price;

2.                                      Total direct compensation opportunity for all of our NEOs is targeted at the market median, except for our Chief Executive Officer, whose compensation is subject to an employment agreement entered into in 2014 (see the section titled “Executive Officer Compensation — Employment Agreement with Our CEO”);

3.                                      Worked with an independent compensation consultant;

4.                                      Maintain a clawback policy covering both cash- and equity-based incentives;

5.                                      “Double-trigger” severance payments for executive officers requiring both a change of control and termination of employment.

6.                                      Robust stock ownership guidelines (CEO at 6x salary).

Practices we avoid with respect to the compensation of our NEOs include:

1.                                      No tax gross ups for perquisites provided to our executive officers;

2.                                      No excise tax gross-ups related to change-in-control severance benefits;

3.                                      No speculative trading of Company stock;

4.                                      No hedging transactions;

5.                                      No repricing of stock options; and

6.                                      No unapproved pledging of Company stock.

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Shareholder Outreach

We expect to continue meeting with many of our stockholders regarding executive and Board compensation throughout 2017 to gather feedback and discuss further possible changes as we continue our strategic review of our compensation programs.

Actions Related to 2017 Executive and Board Compensation

In addition to the significant actions taken in 2016 and prior, the Committee has already implemented a number of additional changes for 2017 executive and Board compensation based on the results of market compensation reviews prepared by Pay Governance, LLC (the Committee’s independent consultant), the Company’s performance in 2016 and stockholder and proxy advisor feedback. These changes are as follows:

1.                                      Continued our executive officer compensation philosophy to target aggregate total compensation of all executive officers, except our CEO as previously noted, at the 50th percentile of the market;

2.                                      No salary increases for NEOs in 2017;

3.                                      Again established a bonus program for our CEO and our President and COO that is tightly tied to achieving superior EPS performance during 2017 with features including the following (additional details are provided in Part 3 of the Compensation Discussion and Analysis below).

2017 EPS goal has been set at a premium to our Board-approved budget; and

No bonus payout for actual EPS less than 80% of target.

4.                                      Established a discretionary bonus pool for our executive officers, including our other NEOs, which is equal to ten percent (10%) of the after-tax profit of the Company in 2017 to be distributed in proportion to each bonus pool participant’s base salary (additional details are provided in Part 3 of the Compensation Discussion and Analysis below);

5.                                      2017 equity awards for our CEO are 100% in the form of premium priced stock options.  The premium exercise price for all 2017 stock options was set by the Board at $7.00, representing a 50.5% premium over the closing price of our stock on the date of grant (details are provided in Part 3 of the Compensation Discussion and Analysis below);

6.                                      2017 equity awards for our NEOs other than our CEO are in the form of market priced stock options; and

7.                                      The Board revised the compensation provided to our non-employee directors to $120,000 annually and comprised of $80,000 annual cash compensation, payable quarterly, and $40,000 in deferred stock units in the Company’s common stock.  The prior compensation provided to our non-employee directors was comprised of $120,000 in annual cash compensation and restricted stock and stock options.  We changed to using deferred stock units due to the preferential tax benefits as compared to stock options.  The revised compensation to our non-employee directors is below the market median (i.e., 50th percentile) of comparable companies.

COMPENSATION DISCUSSION AND ANALYSIS

This section discusses our executive compensation programs for 2016, the compensation decisions made under those programs and the factors that were considered by the Committee in making those decisions.  It focuses on the compensation for each of our NEOs for 2016:

·                  David L. Richter, Chief Executive Officer;

·                  Raouf S. Ghali, President and Chief Operating Officer;

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·                  John Fanelli III, Executive Vice President and Chief Financial Officer;

·                  Mohammed Al Rais, Regional President (Middle East), Project Management Group; and

·                  Frederic Z. Samelian, former President, Construction Claims Group.

Please note that Mr. Samelian is no longer employed by the Company, effective January 2, 2017.

This Compensation Discussion and Analysis is divided into three parts:

Part 1 discusses our compensation practices and the compensation decisions for our NEOs.

Part 2 discusses our compensation framework in more detail, including how we apply our compensation philosophy and determine competitive positioning of our executive compensation and other policies.

Part 3 discusses certain actions taken by the Committee in 2017 regarding compensation decisions for our NEOs.

Part 1 — Compensation Governance Practices and Decisions

2016 Compensation Governance Practices

We are committed to executive compensation practices that drive performance and that align the interests of our leadership team with the interests of our stockholders. We are considering the appropriateness of these and other policies and practices as part of our comprehensive executive compensation strategic review. Below is a summary of best practices that we have implemented and practices we avoid with respect to the compensation of our NEOs.

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2016 Executive Compensation Elements

The following chart summarizes the key features of each element of our executive compensation program: cash (salary and annual bonus); equity (long-term incentive); retirement (401(k) Plan); and other compensation (perquisites).  Each type is discussed in detail in the remainder of this Compensation Discussion and Analysis and the accompanying tables.

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Summary of Key 2016 Compensation Decisions

The following highlights the Committee’s key compensation decisions for 2016, as reported in the section below titled “Executive Officer Compensation — Summary Compensation Table.”

CEO Compensation

On December 31, 2014, David Richter became our CEO and the Company entered into an employment agreement with him at that time.  His employment agreement establishes his total direct compensation (“TDC”) opportunity, consisting of base salary and annual and long-term incentive opportunities which, in the aggregate, must be not less than the 75th percentile of CEOs in our Selected Peer Group (as defined in Part 2 of the Compensation Discussion and Analysis below).  Mr. Richter’s 2016 compensation opportunity was set as follows:

·                  Annual base salary was set at $1,545,000;

·                  Annual bonus target award opportunity was set at $1,050,000; and

·                  Long-term (equity) incentive established as 500,000 premium priced stock options with a fair value at the grant date of $672,500.

President and COO Compensation

On August 18, 2016, we entered into an employment agreement with our President and COO, Raouf S. Ghali, for a term of five years.  Under this agreement, Mr. Ghali is to receive a base salary to be reviewed annually by the Committee. Mr. Ghali’s 2016 compensation opportunity was set as follows:

·                  Annual base salary was set at $1,135,000 per annum;

·                  Annual bonus target award opportunity was set at $300,000;

·                  Long-term (equity) incentive established as 250,000 stock options (in equal numbers of market-priced and premium-priced) with a fair value at the grant date of $362,500.

Compensation of Other NEOs

For the other NEOs, the Committee granted modest salary increases of approximately 3%, set an annual bonus target opportunity of between 20% and 25% of each executive’s base salary and established long-term (equity) incentive comprised of stock options with an aggregate fair value at the grant date of $241,250.

Pay Mix

One of our compensation objectives is to emphasize variable, performance-based compensation over short- and longer-term time horizons and the creation of long-term stockholder value.  To support this goal, a portion of each NEO’s pay is awarded under our long-term incentive plan in the form of stock options.  Nearly 21% of our CEO’s targeted TDC and approximately 20% of the targeted TDC for our President and COO is based upon long-term value creation as measured by growth in our share price.

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2016 NEO Base Salaries, Annual Incentive Target and Long-Term Incentive Expected Value

(1)                                 All base salaries effective as of January 1, 2016.

(2)                                 The expected fair value of the stock options was based on the closing price of the Company’s common stock of $3.27 per share on April 1, 2016 for Messrs. Richter and Ghali and $4.31 per share on June 13, 2016 for the other NEOs.  For the assumptions made in determining grant date fair values, refer to Note 11 to the consolidated financial statements included in our Annual Report on Form 10-K filed with the SEC on March 31, 2017.

(3)                                 Total achievable direct compensation consists of base salary, annual incentive bonus target and long-term equity award expected value.

Our 2016 Annual Incentive Compensation Program

Plan Criteria and Rationale

The 2016 annual incentive opportunities for our NEOs are based on our financial performance as measured by EPS.

In 2016, as in past years, the Committee evaluated the continued use of the target annual incentive award’s (“TAIA”) financial measures using the following principles:

·                  Metrics that support achievement of an annual Board-approved budget;

·                  Metrics that support profitable growth while preserving cash for longer-term investment;

·                  Metrics that are clearly understood and can be affected by the performance of our executives and employees;

·                  Metrics that are consistent with market practice and commonly used by analysts in assessing our performance; and

·                  Metrics that over time, are consistent with the creation of long-term shareholder value.

Following this review, the Committee concluded that the continued use of EPS is a comprehensive measure of income and provides an emphasis on profitable growth while focusing managers on expense control.

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Target Setting

The 2016 target annual incentive awards for our CEO and our President and COO were set as a fixed dollar amount ($1,050,000 and $300,000, respectively) and for our other NEOs as a percentage of their respective annual base salary.  Target awards are reviewed annually to ensure alignment with our compensation philosophy.

Variances from these target payout values are based upon Company performance against the pre-established EPS goals.  The performance/payout relationship around targeted performance levels was set at the beginning of the performance year and reflected our expectation for the year that management should strive to achieve our plan and be held accountable with lower than target payouts if performance fell below plan.  Our 2016 plan used the following performance and payout relationship:

Financial Results for TAIA Purposes

The Committee set the TAIA target based on its evaluation of the budget-based amount and its assessment that the target contained a sufficient degree of “stretch.”  This target, actual 2016 performance and 2016 TAIA bonus payouts for our NEOs are shown in the tables below.

2016 TAIA Performance Metrics, Weight and Achievement

(1)                                 EPS for annual incentive purposes is based on diluted earnings per common share.

2016 TAIA Threshold, Target, Maximum and Actual Payouts

Our Long-Term Equity Incentive Program

Plan Criteria and Rationale

Long-term incentive compensation for all our executive officers, including our NEOs, is entirely equity-based.     Historically, we have delivered this compensation opportunity through the use of stock options.

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Stock option awards are used to complement the TAIA financial metric focus by aligning the team around actions that will promote the long-term growth of our share price.  Our options also have a five-year vesting schedule in order to promote retention of our leaders.

In this way, the combination of our TAIA and options balance the focus of our team in a coordinated way around short-term financial and longer-term share price performance, both of which are directly linked to value creation for stockholders.

Equity Award Grant Practices

The Committee’s equity-based awards policy contains rules on determining the grant date of equity awards and the exercise price of any stock options, which must be at least equal to the fair market value of our stock on the grant date.

2016 Long-Term Equity Awards

In 2016, long-term equity plan participants, including our NEOs, received a grant of stock options.

The value of each NEO award was determined by the Committee after considering company performance, individual impact on our financial results, market norms and relative duties and responsibilities.  The value of the grants made during 2016 to our NEOs are shown in the following table.

2016 Long-Term Equity Award Value

(1)                                 The expected fair value of the stock options was based on the closing price of the Company’s common stock of $3.27 per share on April 1, 2016 for Messrs. Richter and Ghali and $4.31 per share on June 13, 2016 for the other NEOs.  For the assumptions made in determining grant date fair values, refer to Note 11 to the consolidated financial statements included in our Annual Report on Form 10-K filed with the SEC on March 31, 2017.

(2)                                 TDC consists of base salary and annual and long-term incentive opportunities.

Part 2 — Compensation Framework

Compensation Philosophy and Objectives

Our compensation philosophy is to provide competitive executive officer pay opportunities tied to our short-term and long-term success.  This overriding pay-for-performance approach enables us to attract, motivate and retain the type of executive leadership that will help us achieve our strategic objectives and realize increased stockholder value.  To reach these goals, we have adopted the following program objectives:

·                  Link management compensation with the interests and experience of stockholders.

·                  Support achievement of operating performance, strategic objectives and share price growth through variable compensation programs.

·                  Be fair and market-competitive to assure access to needed talent and encourage retention.

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·                  Provide compensation opportunities that are consistent with each executive’s responsibilities, experience and performance.

·                  Design compensation incentive programs that promote a sensible risk/reward balance, and that do not encourage unnecessary or unreasonable risk-taking.

·                  Use perquisites sparingly.

Applying our Compensation Philosophy

We apply our compensation philosophy and objectives as follows:

Competitive Positioning

In support of our compensation philosophy, we target the compensation values consistent with the markets with which we compete for executive talent, capital and business; for the CEO, this market is defined as our Selected Peer Group.

The Selected Peer Group is composed of companies with size, industry, operational and client characteristics that are similar to Hill.

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Generally, we use data drawn from this group as a reference which the Committee reviews competitive pay practices, design approaches and for pay-for-performance comparisons.

Where compensation data and practices are not available from companies within the Selected Peer Group, the Committee also references broader survey sources which include other companies of comparable size, scope and complexity, with which we compete for talent.  This approach provides the Committee with decision-quality data and context.  The Committee annually evaluates and, if appropriate, updates the composition of the Selected Peer Group and approach to collecting broader compensation benchmarking data.  The 2016 Selected Peer Group consisted of the following companies:

2016 Selected Peer Group

CRA International, Inc.           Exponent, Inc.           Huron Consulting Group, Inc.           Navigant Consulting, Inc.

For our other NEOs, we relied upon data samples and a market survey provided by our independent compensation consultant.

Setting Compensation Targets and Performance Goals

The Committee annually reviews the total compensation opportunity of each executive officer—i.e., cash compensation (salary and target annual incentive opportunity) and long-term equity compensation (target long-term equity value).

The Committee, with periodic input from an independent consultant, then sets the executive’s compensation target for the current year. Salary adjustments, if any, typically become effective as of January 1 of each year or upon a promotion.  The compensation proposal for our CEO and our President and COO is reviewed with and ratified by the independent directors of the Board in executive session.

In making its decisions, the Committee uses several resources and tools, including competitive market information and peer group compensation trends, broader survey sources and the larger executive compensation environment.

For 2016, the Committee set target performance levels for the financial objectives used in the TAIA and concluded that there was an appropriate correlation between payout and performance levels (at target, threshold and maximum) in light of the business environment, risks associated with achieving our five-year strategic plan and other factors.

Evaluating Performance

For our NEOs, performance determination under the TAIA was 100% based on financial metrics.  The Committee also considers competitive market norms in making final compensation decisions.

Role of the Compensation Committee and Management

The Committee reviews all of our compensation and benefit programs. As part of its review of these programs, the Committee evaluates the competitiveness of compensation and benefits packages offered to our named executive officers and other executive officers. In addition, the Committee reviews and approves our corporate incentives, goals and performance objectives as well as the incentives, goals and performance objectives we establish for individuals under our compensation and benefit programs. The Committee evaluates the level of achievement of the corporate incentives, goals and performance objectives set for individuals and, based on the level of achievement, approves any awards dependent on these criteria under our compensation and benefit programs.

Consistent with prior years, as part of the executive compensation decisions made in 2016, our Chief Executive Officer and our President and Chief Operating Officer made recommendations to the Committee regarding the levels and elements of compensation for the named executive officers, other than themselves, as well as for other executive officers of the Company. The Committee also received a compensation analysis regarding our senior executive officers, including our NEOs, from its compensation consultant, Pay Governance LLC, an executive compensation

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advisory firm. After considering the analysis prepared by Pay Governance LLC and the recommendations of our Chief Executive Officer and our President and Chief Operating Officer, the Committee determined its recommendations to the Board for the Board’s approval of the compensation for our NEOs. In determining its recommendations to the Board, the Committee relied considerably on assessments by our Chief Executive Officer and our President and Chief Operating Officer of the performance and contribution of the other named executive officers and utilized the advice of Pay Governance LLC primarily as an effective “market check” designed to assure that compensation for the other named executive officers would be appropriate in view of other compensation packages that may be offered by the Company’s peers and other prospective employers of these executives.

Post-Employment Compensation Arrangements

Termination Payments

In the event of a change in control, we provide certain senior executive officers with benefits upon termination in various circumstances under our 2015 Senior Executive Retention Plan (the “2015 Retention Plan”) and under our 2016 Executive Retention Plan (the “2016 Retention Plan” and, collectively with the 2015 Retention Plan, the “Retention Plans”). The Retention Plans provide change in control severance benefits only upon the occurrence of a “double-trigger” (change in control and termination of employment).  Generally, the benefits under the 2015 Retention Plan provide for one year of salary and benefits continuation; the benefits under our 2016 Retention Plan provide for two years of salary upon termination following a change in control.  For 2016, each of our NEOs, except our CEO and our President and COO, was eligible to receive benefits under the 2015 Retention Plan, and Mr. Fanelli and Al Rais were eligible to receive benefits under the 2016 Retention Plan.

Under their respective employment agreements, Messrs. Richter and Ghali are eligible to receive certain benefits if (i) his employment is terminated by the Company without cause, (ii) he terminates his employment for good reason or (iii) he terminates his employment within two years of a change in control of the Company.  Generally, in the case of Mr. Richter, these benefits provide for three years of salary and benefits continuation; in Mr. Ghali’s case, these benefits provide for the payment of a lump sum of $2,270,000 (two times his 2016 salary) upon termination.

We detail the compensation estimated to be paid to our NEOs under various termination circumstances as of December 31, 2016 in the section below titled “Executive Officer Compensation — Potential Payments Upon Termination or Change in Control.”

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Other Compensation Policies

Personal Benefits

We provide our NEOs with other benefits that we believe are reasonable and competitive so that we may attract and retain talented senior executives.  In total, they represent a small percentage of each NEO’s overall compensation and generally are identical to the benefits provided to all other Hill employees.

Policy on Hedging and Pledging

Our insider trading policy contains restrictions on certain transactions in Company stock by executive officers and directors.  All trades by executive officers and directors must be pre-cleared.  The executive officers and directors are prohibited from any trading in puts or calls, from engaging in short sales of Company stock or from hedging Company stock.  Making pledges of Company stock or using it as loan collateral or as part of a margin account in the future is prohibited unless expressly approved by the Board.

Risk Considerations in Our Compensation Programs

The Committee has reviewed our compensation policies and practices for the Company’s executive officers and concluded that any risks arising from these policies and programs are not reasonably likely to have a material adverse effect.  The Committee believes that the mix and design of the elements of our compensation program are appropriate and encourage executive officers and key employees to strive to achieve goals that benefit the Company and our stockholders over the long term.  Our compensation policies and procedures are applied uniformly to all eligible participants and when viewed in aggregate, our programs provide sufficient safeguards, balance and governance that does not encourage excessive risk-taking by our employees.

Part 3 — 2017 Compensation Committee Actions

2017 Committee Actions

The Committee continues the process of reviewing the Company’s compensation philosophy and evaluating the design and performance of our executive compensation programs to ensure we have a program that aligns with governance and market best practices to the fullest extent possible while ensuring it is structured to best support achievement of our business strategy and human capital needs.  As a result of this ongoing review and evaluation, the Committee has already taken the following actions at this point in 2017:

No Salary Increases — Maintained salaries for named executive officers at 2016 amounts; re-affirmed that there will be generally no or limited salary adjustments for this group in the near future.

2017 TAIA Bonus Plan for our CEO and our President and COO — Adopted 2017 TAIA for our CEO and our President and COO entirely based on achieving superior EPS results for the year with an annual bonus target award opportunity of $1,820,000 and $300,000, respectively.  Target EPS performance has been set at a premium over the 2017 operating budget and in excess of last year’s actual EPS results.  The overall performance/payout range for 2017 has been set as follows:

2017 Bonus Pool for other executive officers, including the other NEOs — Established a discretionary bonus pool for our executive officers, including our other NEOs, which is equal to ten percent (10%) of the after-tax profit of the Company in 2017 to be distributed in proportion to each bonus pool participant’s base salary.  Our CEO and our President and COO only have the option to award either 100% of the participant’s entitled proportion of the bonus pool or award no bonus to the participant.  Our CEO and our President and COO do not have the option to award a percentage other than 0%

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or 100% to each participant.  If our CEO and our President and COO determine that a participant in the bonus pool will not receive a bonus, their potential share is removed from the pool, i.e., it is not shared among remaining participants.

Premium-Priced Stock Option Grants — The 2017 Long-Term Incentive Awards to our CEO were in the form of Premium-Priced stock options.  Mr. Richter was granted 100,000 stock options with a premium exercise price of $7.00, representing a 50.5% premium over the $4.65 closing price of our common stock on the date of grant.

Revised Director Compensation — Following a market review by our independent compensation consultant, the compensation provided to our non-employee directors was revised to $120,0000 annually to better align with market median and is comprised of $80,000 annual cash compensation, payable quarterly, and $40,000 in deferred stock units in the Company’s common stock.  Also, the Board revised the compensation of the Chairman of the Board to receive an additional annual retainer of $60,000, payable as $30,000 in cash and $30,000 in the form of deferred stock units.

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Compensation Committee Report

The Compensation Committee has reviewed and discussed the Compensation Discussion and Analysis set forth above with the Company’s management.  Based on such review and discussion, the Compensation Committee recommended to the Board, and the Board approved, the inclusion of the Compensation Discussion and Analysis in this Annual Report on Form 10-K/A.

Compensation Committee

Steven R. Curts (Chairman)

Paul J. Evans
David Sgro

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Executive Officer Compensation

Summary Compensation Table

The following table contains information concerning the annual compensation for our NEOs during 2016, 2015 and 2014.

Summary Compensation Table

(1)                                 The amounts reported in this column reflect the aggregate grant date fair value of grants of stock options calculated in accordance with Financial Accounting Standards Board Accounting Standards Codification Topic 718 (“ASC 718”).  The calculation of these amounts disregards the estimate of forfeitures related to time-based vesting conditions.  The amounts in this column do not reflect compensation actually received by the named executive officer.  The actual value, if any, that an executive may realize from an award is contingent upon the satisfaction of the conditions to vesting in that award, and upon the excess of the stock priced over the exercise price, if any, on the date the award is exercised.  Thus, there is no assurance that the value, if any, eventually realized by the named executive officer will correspond to the amount shown.

(2)                                 The Black-Scholes option valuation model is used to estimate the fair value of the options in accordance with ASC 718.  For a discussion of the assumptions used, see Note 13 to the Company’s 2016 consolidated financial statements.

(3)                                 Hill provides its NEOs with additional benefits, reflected in the table below for 2016, that Hill believes are reasonable, competitive and consistent with the Company’s overall executive compensation program.

(4)                                 Mr. Richter was promoted to CEO on December 31, 2014.  He was previously our President and COO.

(5)                                 As of January 2, 2017, Mr. Samelian is no longer employed by the Company.

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Grants of Plan-Based Awards

The following table presents information about plan-based awards made to our named executive officers in 2016:

(1)                                 The amounts listed represent potential threshold, target and maximum bonuses available to our CEO and our President and COO under the Bonus Plan for 2016.  The actual payments are reported above in the Summary Compensation Table in the column entitled “Non-Equity Incentive Plan Compensation.”

(2)                                 Represents options issued under the 2006 Employee Stock Option Plan.  Information regarding the vesting schedules and expiration of these options is included in the “Outstanding Equity Awards at Fiscal Year-End” table and the footnotes thereto.  Options will vest on an accelerated basis upon the executive’s termination of employment under certain circumstances.  Additional information regarding the vesting acceleration provisions applicable to equity awards is included under the heading “Potential Payments upon Termination or Change in Control.”

(3)                                 See footnotes 1 and 2 to the Summary Compensation Table regarding calculation of these amounts.

Outstanding Equity Awards at Fiscal Year End

The following table presents information with respect to outstanding equity awards held by our named executive officers as of December 31, 2016.

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(1)                                 These options were granted on March 31, 2010 and vest at the rate of 20% per year with vesting dates of March 31, 2011, 2012, 2013, 2014 and 2015.

(2)                                 These options were granted on January 26, 2011 and vest at the rate of 25% per year with vesting dates of January 26, 2012, 2013, 2014 and 2015.

(3)                                 The named executive officer’s beneficial ownership of the Company’s common stock exceeded 10% on the grant date.  The 2006 Employee Stock Option Plan requires that the grant of incentive stock options to a stockholder whose ownership of the Company exceeds 10% at the time of grant be made at an exercise price equal to 110% of the fair market value of the Company’s common stock at the date of grant.

(4)                                 These options were granted on March 6, 2012 and vest at the rate of 25% per year with vesting dates of March 6, 2013, 2014, 2015 and 2016.

(5)                                 These options were granted on January 21, 2013 and vest at the rate of 25% per year with vesting dates of January 21, 2014, 2015, 2016 and 2017.

(6)                                 These options were granted on January 2, 2014 and vest at the rate of 20% per year with vesting dates of January 2, 2015, 2016, 2017, 2018 and 2019.

(7)                                 These options were granted on January 2, 2015 and vest at the rate of 20% per year with vesting dates of January 2, 2016, 2017, 2018, 2019 and 2020.

(8)                                 These options were granted on April 2, 2016 and vest at the rate of 20% per year with vesting dates of April 2, 2017, 2018, 2019, 2020 and 2021.

(9)                                 These options were granted on June 3, 2011 and vest at the rate of 20% per year with vesting dates of June 3, 2012, 2013, 2014, 2015 and 2016.

(10)                          These options were granted on January 21, 2013 and vest at the rate of 20% per year with vesting dates of January 21, 2014, 2015, 2016, 2017 and 2018.

(11)                          These options were granted on March 10, 2014 and vest at the rate of 20% per year with vesting dates of March 10, 2015, 2016, 2017, 2018 and 2019.

(12)                          These options were granted on January 27, 2015 and vest at the rate of 20% per year with vesting dates of January 27, 2016, 2017, 2018, 2019 and 2020.

(13)                          These options were granted on June 13, 2016 and vest at the rate of 20% per year with vesting dates of June 13, 2017, 2018, 2019, 2020 and 2021.

Option Exercises

The following table provides information on the exercise of stock options by our named executive officers during 2016.

Employment Agreement with Our CEO

Under an agreement effective December 31, 2014 with a five-year term, our CEO, David L. Richter, receives a base salary of no less than $1,000,000, to be adjusted annually, and is eligible to receive an annual bonus based upon the achievement of performance criteria to be established by the Board or its Compensation Committee for the applicable year.  He also is eligible to receive an annual long-term incentive award, which may consist of stock options issued by the Company, shares of restricted stock of the Company, and other forms of equity-based, equity-linked or other long-term incentive compensation. The amount and other terms of long-term incentive awards made to him, if any, are determined by the Board or its Compensation Committee.  The agreement establishes his total direct compensation opportunity, consisting of base salary and annual and long-term incentive opportunities at least at the 75th percentile of CEOs in our Selected Peer Group.  The agreement further provides that he is entitled to all benefits of employment provided to other employees of the Company and provides Mr. Richter with two vehicles for his use during the employment term.

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Employment Agreement with Our President and COO

Under an agreement effective August 18, 2016 with a five-year term, our President and COO, Raouf S. Ghali, is to receive a base salary the amount of which shall be reviewed annually by the Company’s Compensation Committee. Mr. Ghali’s current base salary is $1,135,000 per annum.  In addition to base salary, Mr. Ghali will be eligible to receive an annual bonus based upon the achievement of performance criteria to be established by the Board or its Compensation Committee for the applicable year. Mr. Ghali also will be eligible to receive an annual long-term incentive award, which may consist of stock options issued by the Company, shares of restricted stock of the Company, and other forms of equity-based, equity-linked or other long-term incentive compensation. The amount and other terms of long-term incentive awards made to Mr. Ghali, if any, will be determined by the Board or its Compensation Committee.  The agreement further provides that Mr. Ghali is entitled to all benefits of employment provided to other employees of the Company.  Mr. Ghali may terminate the employment agreement at any time upon no less than 30 days prior written notice to the Company of such termination.

2015 Senior Executive Retention Plan

On January 27, 2015, the Board adopted the Hill International, Inc. 2015 Senior Executive Retention Plan (the “2015 Retention Plan”) and became effective immediately. The Board adopted the 2015 Retention Plan as part of its effort to minimize distractions to certain executives created by a pending or threatened change in control and to provide such executives with compensation and benefit arrangement upon a change in control which ensure that the executives’ expectations will be satisfied. The 2015 Retention Plan provides certain severance benefits during the two-year period immediately following a change in control (as defined in the 2015 Retention Plan) to certain senior officers of the Company as selected by the Board, including each of the Company’s named executive officers with the exception of those officers who have separate employment agreements or other arrangements with the Company providing for severance, in the event of (i) involuntary termination of employment by the Company other than for certain events constituting “cause” set forth in the 2015 Retention Plan, or (ii) voluntary resignation for good reason (as defined in the 2015 Retention Plan). Under the 2015 Retention Plan, following a qualifying termination, the participant will receive (i) a lump-sum payment of an amount equal to one year of the executive’s then base annual salary, payable within 30 days after the effective date of the event giving rise to the benefits under the 2015 Retention Plan, and (ii) if the executive’s employment is terminated by the Company “without cause” or by the executive for “good reason” during the two-year period immediately following a change in control, any and all stock options, stock grants or other equity-based compensation granted to such executive will immediately vest. If required by Internal Revenue Code Section 409A, payments or benefits to certain executives may be delayed by up to 6 months from the date of termination.  A participant that is a party to any employment agreement or other arrangement with the Company providing for severance is not eligible to receive benefits under the Plan unless he or she waives any rights to such other severance.

As of December 31, 2016, Frederic Z. Samelian was designated as a Participant under the 2015 Retention Plan; effective January 2, 2017, Mr. Samelian is no longer employed by the Company.

2016 Executive Retention Plan

Effective November 3, 2016, the Board adopted the Company’s 2016 Executive Retention Plan (the “2016 Retention Plan”) which provides for the payment of severance benefits by the Company to certain designated employees (each a “Participant”) whose employment is permanently terminated due to an Involuntary Termination (as defined in the 2016 Retention Plan).  Upon termination of a Participant’s employment by the Company without “Cause” (as set forth in the 2016 Retention Plan) or by the Participant for “Good Reason” (as defined in the Plan), the Company will be required to pay to the Participant a lump sum cash payment in an amount equal to one times the Participant’s base salary at such time; notwithstanding the foregoing, if the termination is within one year following a Change in Control (as defined in the 2016 Retention Plan), the Company will be required to pay to the Participant a lump sum cash payment in an amount equal to two times the Participant’s base salary at such time and any and all unvested stock options, stock grants or other stock based compensation granted to the Participant shall then immediately vest.

Effective November 3, 2016, John Fanelli, III and Mohammed Al Rais were designated as Participants under the 2016 Retention Plan. No other named executive officer was designated as a Participant under the 2016 Retention Plan.

Potential Payments Upon Termination or Change in Control

The Company has entered into agreements and maintains plans that will require the Company to provide compensation to certain individuals in the event of a termination of employment and/or a change in control of the Company.  The potential

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amount of compensation payable to each individual in each situation is set forth in the tables below.  The amounts shown in the tables assume that termination of the individual and/or a change in control occurred on December 31, 2016 and are based on the closing price per share of Hill common stock on that date of $4.35.  The actual amounts to be paid will depend on the circumstances and time of the termination or change in control.  Please see “Employment Agreement with Our CEO” and “Employment Agreement with Our President and COO” for a description of the material terms of the employment agreement we entered into with each of our CEO and our President and COO.  In addition, the Company has change in control arrangements with our other NEOs.

David L. Richter

(1)                                 Upon David L. Richter’s death, the Company shall continue to pay to his surviving spouse his then base salary, for a period of 90 days.  On December 31, 2016, Mr. Richter’s base salary was $1,545,000.

(2)                                 The Company is required to make this cash payment to Mr. Richter within thirty days after the effective date of such termination in an amount equal to three years of his then base salary if (i) his employment is terminated by the Company without cause, (ii) he terminates his employment for good reason or (iii) he terminates his employment within two years of a change in control of the Company.

(3)                                 Mr. Richter is entitled to all benefits of employment provided to other employees of the Company in comparable positions for a period of three years.

(4)                                 The Company is required to continue to provide Mr. Richter with two Company vehicles appropriate to his position and pay all insurance, fuel, maintenance and operating expenses of such vehicles for a period of three years if (i) his employment is terminated by the Company without cause, (ii) he terminates his employment for good reason or (iii) he terminates his employment within two years of a change in control in the Company.

(5)                                 Mr. Richter’s stock options immediately vest if the Company terminates him without cause.  As of December 31, 2016, Mr. Richter had unvested stock options to purchase 125,000 shares at an exercise price of $4.04 per share, 300,000 shares at $3.95 per share, 400,000 shares at $3.91 per share, 250,000 shares at $4.00 per share and 250,000 shares at $5.00 per share. This amount represents the intrinsic value of the award based on the difference between the exercise price and $4.35, the closing price of the Company’s common stock on December 31, 2016.  The amount reported does not include the value of accelerated options where the exercise price of such options exceeded the closing price of the Company’s common stock on December 31, 2016.

John Fanelli III

(1)                                 Pursuant to the 2016 Retention Plan, the Company is required to make this cash payment to Mr. Fanelli at the effective date of such termination in an amount equal to his then base salary.

(2)                                 Pursuant to the 2016 Retention Plan, the Company is required to make this cash payment to Mr. Fanelli at the effective date of such termination in an amount equal to two times his then base salary.

(3)                                 Mr. Fanelli’s stock options immediately vest if he is involuntarily terminated within two years following a change in control.  As of December 31, 2016, Mr. Fanelli had unvested stock options to purchase 10,000 shares at an exercise price of $3.67 per share, 15,000 shares at $4.95 per share, 40,000 shares at $4.03 per share, 25,000 shares at $4.31 and 25,000 shares at $5.17.  This amount represents the intrinsic value of the award base on the difference between the exercise price and $4.35, the closing price of the Company’s common stock on December 31, 2016.  The amount does not include the value of accelerated options where the exercise price of such options exceeded the closing price of the Company’s stock on December 31, 2016.

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Raouf S. Ghali

(1)                                 The Company is required to make this cash payment to Mr. Ghali within thirty days after the effective date of such termination in an amount equal to three years of his then base salary if (i) his employment is terminated by the Company without cause, (ii) he terminates his employment for good reason or (iii) he terminates his employment within two years of a change in control of the Company.

(2)                                 Mr. Ghali’s stock options immediately vest if the Company terminates him without cause.  As of December 31, 2016, Mr. Ghali had unvested stock options to purchase 40,000 shares at an exercise price of $3.67 per share, $60,000 shares at $4.95 per share, 200,000 shares at $4.03 per share and 250,000 shares at $4.00 per share. This amount represents the intrinsic value of the award based on the difference between the exercise price and $4.35, the closing price of the Company’s common stock on December 31, 2015.  The amount reported does not include the value of accelerated options where the exercise price of such options exceeded the closing price of the Company’s common stock on December 31, 2015.

Frederic Z. Samelian

(1)                                 The Company would have been required to make this cash payment to Mr. Samelian at the effective date of such termination in an amount equal to his then base salary.  As of January 2, 2017, Mr. Samelian is no longer an employee of the Company.

(2)                                 Mr. Samelian’s stock options immediately vest if he is involuntarily terminated within two years following a change in control.  As of December 31, 2016, Mr. Samelian had unvested stock options to purchase 20,000 shares at an exercise price of $3.67 per share, 24,000 shares at $4.95 per share and 20,000 shares at an exercise price of $4.03 per share.  This amount represents the intrinsic value of the award based on the difference between the exercise price and $4.35 per share, the closing price of the Company’s common stock on December 31, 2016.  The amount reported does not include the value of accelerated options where the exercise price of such options exceeded the closing price of the Company’s common stock on December 31, 2016.

Mohammed Al Rais

(1)                                 Pursuant to the 2016 Retention Plan, the Company is required to make this cash payment to Mr. Al Rais at the effective date of such termination in an amount equal to his then base salary.

(2)                                 Pursuant to the 2016 Retention Plan, the Company is required to make this cash payment to Mr. Al Rais at the effective date of such termination in an amount equal to two times his then base salary.

(3)                                 Mr. Al Rais’ stock options immediately vest if he is involuntarily terminated within one year following a change in control.  As of December 31, 2016, Mr. Al Rais had unvested stock options to purchase 16,000 shares at an exercise price of $3.67 per share, 30,000 shares at $4.95 per share, 40,000 shares at $4.03 per share, 37,500 shares at $4.31 per share and 37,500 shares at $5.17 per share.  This amount represents the intrinsic value of the award base on the difference between the exercise price and $4.35, the closing price of the Company’s common stock on December 31, 2016.  The amount does not include the value of accelerated options where the exercise price of such options exceeded the closing price of the Company’s stock on December 31, 2016.

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Director Compensation

Other than our CEO and our President and COO whose compensation is reflected on the Summary Compensation Table above, the table below details the compensation paid to our directors for their service as a director in 2016.  Previously, the Company paid each non-employee director $120,000 in cash and a grant of restricted stock and stock options for his or her service.  Beginning in November 2016, the Board revised the compensation paid to each non-employee director to $120,000 for his or her service, of which $80,000 is payable in cash and $40,000 is payable in deferred stock units.  Also, the Board revised the compensation of the Chairman of the Board to receive an additional annual retainer of $60,000, payable as $30,000 in cash and $30,000 in the form of deferred stock units.  The Chairman of the Compensation Committee and the Chairman of the Governance and Nominating Committee each continue to receive an additional annual committee chairman’s fee of $5,000 payable in cash, and the Chairman of the Audit Committee continues to receive an additional annual committee chairman’s fee of $10,000 payable in cash.