Exhibit 10.1


 


GREAT LAKES DREDGE &
DOCK COMPANY, LLC


 


ANNUAL CASH BONUS PLAN


 


Amended
and Restated Effective January 1, 2009


 


Purpose


 


The Great Lakes Dredge & Dock Company, LLC
(the “Company”) Annual Cash Bonus Plan (the “Plan”) is established to provide annual
cash bonuses to employees of the Company upon satisfaction of certain
performance criteria.  Different bonus
levels are utilized to compensate employees appropriately based on their
ability to influence the profitability of the Great Lakes Dredge & Dock
Corporation (the “Corporation”) and its subsidiaries.


 


Administration


 


The Plan is administered by the Corporation’s
Compensation Committee of the Board of Directors (the “Compensation Committee”),
which subject to its oversight may delegate responsibilities for administering
the Plan to the Company’s Chief Executive Officer (“CEO”), Chief Operating
Officer (“COO”) and Chief Financial Officer (“CFO”) (collectively, the “Management
Committee”) to the extent such responsibilities do not relate to determining
bonus awards for members of the Management Committee.


 


Eligibility for Participation


 


The Compensation Committee or the Management
Committee, as applicable, in its sole discretion, shall designate each year
those employees of the Company who shall participate in the Plan (the “Participants”).  Except as otherwise set forth in an
applicable employment agreement or similar arrangement, a Participant whose
employment by the Company terminates for any reason during a calendar year
performance period (a “Performance Year”) shall not be entitled to receive a
bonus for such Performance Year and, following such termination, the Company
shall have no further obligation hereunder to that Participant.


 


Determination of Bonus Awards


 


“Budgeted EBITDA” for purposes of the Plan is defined
as the budgeted amount of earnings before interest, taxes, depreciation and
amortization attributable to the Company’s dredging segment approved by the
Board of Directors of the Corporation for each Performance Year.  For determination of bonus awards, the
Compensation Committee may in its sole discretion adjust actual EBITDA
attributable to the Company’s dredging segment (“Actual EBITDA”) for any
extraordinary or non-recurring items. All bonus awards shall be distributed to
Participants by March 15 following the Performance Year in which they are
earned.


 


Bonus awards are determined as follows:


 


1.             Holiday Bonus Program – Annual holiday bonuses, if any, are
payable to non-management employees. 
Awards are based solely on Company performance during a Performance
Year.  Holiday bonuses for a Performance
Year are payable only if Actual EBITDA 


 

















 


equals or exceeds 70% of
Budgeted EBITDA for such Performance Year. 
Each Participant eligible for an annual holiday bonus is classified by
the Management Committee among one of four categories, based upon the
Participant’s level of responsibility. 
The Management Committee will set three levels for each category
(minimum, budget and maximum).  To the
extent annual bonuses are payable for a Performance Year, the amount of the
bonus payable to a Participant depends on (i) the category in which the
Participant is classified and (ii) the bonus level achieved, as determined
in the discretion of the Management Committee. 
The budget bonus is payable when Actual EBITDA is in the discretion of
the Management Committee equal to or sufficiently close to Budgeted
EBITDA.  When the Actual EBITDA is
sufficiently below the Budgeted EBITDA, as determined by the Management Committee
in its discretion, but at least equal to 70% of Budgeted EBITDA, the minimum
bonus is payable.  When the Actual EBITDA
is sufficiently above Budgeted EBITDA, as determined by the Management
Committee in its discretion, the maximum bonus is payable.


 


2.             Performance Bonus  Program – Annual
performance bonuses, if any, are awarded to management employees other than the
Company’s CEO, COO, CFO and Senior Vice Presidents (“SVPs”).  Annual performance bonuses are allocated to
such management employees from a bonus pool expressed as a percentage of the
aggregate eligible salaries of such management employees (as of the end of the
Performance Year).  The size of the bonus
pool for a Performance Year depends on Company performance, which is measured
by comparing Actual EBITDA with Budgeted EBITDA for the Performance Year.  No annual performance bonuses are payable for
a Performance Year if Actual EBITDA is less than 70% of Budgeted EBITDA for
such Performance Year.  Allocations of
annual performance bonuses from the bonus pool among eligible Participants will
be based on individual Participant performance, as determined by the
Compensation Committee (or the Management Committee) in its sole discretion.


 


The bonus pool is determined as follows:


 


	
  Actual
  EBITDA

  	
   

  	
  Bonus
  Pool

  
	
  ‹
  70% of Budgeted EBITDA

  	
   

  	
  No bonus pool

  
	
  = 70% of Budgeted
  EBITDA

  	
   

  	
  5.75% of eligible
  salaries

  
	
  = 100% of Budgeted
  EBITDA

  	
   

  	
  11.5% of eligible
  salaries

  
	
  >= 130% of Budgeted
  EBITDA

  	
   

  	
  23% of eligible
  salaries

  



 


To the extent Actual
EBITDA falls between EBITDA thresholds, the bonus pool is determined by
interpolation.


 


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3.             Senior Management Bonus Program – The Company’s CEO, COO,
CFO and SVPs are eligible to receive bonuses based upon Company performance as
follows:


 


	
  Actual EBITDA

  	
   

  	
  Bonus Award

  CEO and COO

  	
   

  	
  Bonus Award

  CFO and SVPs

  
	
  ‹
  90% of Budgeted EBITDA

  	
   

  	
  No bonus

  	
   

  	
  No bonus

  
	
  = 90% of Budgeted
  EBITDA

  	
   

  	
  35% of annual salary

  	
   

  	
  23.75% of annual salary

  
	
  = 100% of Budgeted
  EBITDA

  	
   

  	
  70% of annual salary

  	
   

  	
  47.5% of annual salary

  
	
  >= 120% of Budgeted EBITDA

  	
   

  	
  140% of annual salary

  	
   

  	
  95% of annual salary

  



 


To the extent Actual
EBITDA falls between EBITDA thresholds, the bonus award is determined by
interpolation.


 


Miscellaneous


 


a)                                      Although it is the present intention of
the Compensation Committee to continue the Plan for a indefinite period of
time, the Compensation Committee reserves the right to terminate the Plan in
its entirety at any time or to modify the Plan as it exists from time to time, provided
that no such action shall adversely affect any bonus previously awarded under
the Plan with respect to a prior Performance Year and provided further,
that except as otherwise permitted under the Plan, no termination or
modification which would adversely affect a Participant hereunder shall take
effect with respect to a Performance Year in progress at the time of such
action.


 


b)                                     No bonus payable under the Plan shall be
subject in any manner to anticipation, alienation, sale, transfer, assignment,
pledge, encumbrance or charge prior to actual receipt thereof by the payee; and
any attempt to so anticipate, alienate, sell transfer, assign, pledge, encumber
or charge prior to such receipt shall be void. 
The Company shall not be liable in any manner for or subject to the debts,
contracts, liabilities, engagements or torts of any person entitled to any
bonus under the Plan.


 


c)                                      Nothing contained herein shall confer
upon any Participant the right to be retained in the service of the Corporation
or any subsidiary thereof, nor limit the right of the Corporation or any
subsidiary thereof to discharge or otherwise deal with any Participant without
regard to the existence of the Plan.


 


d)                                     The Plan shall at all times be entirely
unfunded and no provision shall at any time be made with respect to segregating
assets of the Corporation or any subsidiary thereof for payment of any bonuses
hereunder.  No Participant or any other
person shall have any interest in any particular assets of the Corporation or
any subsidiary thereof by reason of the right to receive a bonus under the Plan
and any such Participant or any other person shall have only the rights of a
general 


 


3

















 


unsecured creditor of the Corporation or any subsidiary thereof with
respect to any rights under the Plan.


 


e)                                      The Plan is intended to be exempt from
the requirements of Section 409A of the Internal Revenue Code of 1986, as
amended, and any ambiguity in the Plan shall be interpreted to this effect.


 


f)                                        To the extent required by law, the
Company will withhold from payments otherwise due hereunder such taxes required
to be withheld by the federal or any state or local government.


 


g)                                     The Plan shall be governed by and
construed in accordance with the laws of the State of Illinois.


 


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