exv10w1



 






Exhibit 10.1




Helmerich & Payne, Inc.

Annual Bonus Plan for Executive Officers



Overview



Annual bonus awards are available to certain executive officers to recognize and reward
desired performance. Each year the Human Resources Committee (the “Committee”) approves the
participants, the performance measures, and the specific financial and strategic objectives. An
executive officer’s bonus award opportunity is determined primarily by the individual’s position
and level of responsibility.




Participation



The current participants in the Plan will be H&P’s executive management team, which includes



Hans Helmerich,

John Lindsay,

Alan Orr,

Doug Fears, and

Steve Mackey.



Bonus Award Opportunity



Participants are assigned target bonus awards expressed as percentages of base salary. These
bonus awards are earned when performance objectives are achieved. The award percentages
are as follows:




	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	Threshold	 	Target	 	Reach
	Hans Helmerich
	 	 	40	%	 	 	80	%	 	 	120	%
	John Lindsay
	 	 	25	%	 	 	50	%	 	 	75	%
	Alan Orr
	 	 	25	%	 	 	50	%	 	 	75	%
	Doug Fears
	 	 	20	%	 	 	45	%	 	 	70	%
	Steve Mackey
	 	 	20	%	 	 	45	%	 	 	70	%






Financial Performance Objectives



The financial performance objectives selected align management with shareholders. When these
objectives are met, shareholders will realize greater value in their Company ownership. A
participant’s bonus award will be based upon three disproportionately weighted financial measures
being:




	 	 	 	 	 
	Financial Measure	 	Weighting
	Earnings Per Share
	 	 	35	%
	Return on Invested Capital
	 	 	35	%
	Operating EBITDA
	 	 	30	%






 









 





The Board of Directors annually approves an operating and capital budget at its September meeting.
Each financial measure would be assigned threshold, target and reach numbers based upon this
approved budget. Actual financial results would be compared to the budgeted numbers for each of
the financial measures to determine the amount of any bonus. Based on the ___fiscal year
budget, the following financial performance benchmarks have been developed for each financial
measure:




	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	Prior	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	Fiscal	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	Year	 
	 	 	Threshold	 	 	Target	 	 	Reach	 	 	Actual	 
	Earnings Per Share
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 
	Return on Invested Capital
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 
	Operating EBITDA
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 





	 	 	 	 	 	 	 	 	 
	 	 	Current	 	 	Prior	 
	 	 	Fiscal	 	 	Fiscal	 
	 	 	Year	 	 	Year	 
	Assumptions	 	Target	 	 	Actual	 
	Revenue Days — U.S. Land:
	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 
	Revenue Per Day — U.S. Land:
	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 
	U.S. Land Rig Utilization:
	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 
	U.S. Offshore Utilization:
	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 
	International Utilization:
	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 





Strategic Performance Objectives



The bonus, if any, derived from the Company’s financial performance may then be adjusted by a
maximum of 30% as determined by the Committee (“adjustment factor”). Seventy-five percent of this
adjustment factor would be based upon the Committee’s evaluation of the Company’s total shareholder
return relative to an industry peer group. The remaining 25% of this adjustment factor would be
based upon the Committee’s evaluation of the Company’s goal of attaining higher than industry
average utilization and premium day rates.



This adjustment factor would be subject to a pre-determined safety performance threshold. For
fiscal year ___, in order to meet that threshold, H&P’s OSHA and DAWFC rates must be ___below
IADC averages. If this safety performance threshold is not met, then the bonus would not be
increased by the adjustment factor. The bonus would not be decreased by the adjustment factor
solely for the reason that safety performance threshold was not met. However, if the adjustment
factor resulted in a decrease to the bonus, then the bonus would be decreased even if the safety
performance threshold is met.





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