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”)
reviews and makes any desired changes to 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 participants in the Plan are H&P’s executive management team,
which includes


 


•                  Hans Helmerich


•                  John Lindsay


•                  Alan Orr


•                  Doug Fears


•                  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%

  	
   

  	
  130%

  
	
  John Lindsay

  	
   

  	
  25%

  	
   

  	
  50%

  	
   

  	
  100%

  
	
  Alan Orr

  	
   

  	
  25%

  	
   

  	
  50%

  	
   

  	
  100%

  
	
  Doug Fears

  	
   

  	
  25%

  	
   

  	
  50%

  	
   

  	
  100%

  
	
  Steve Mackey

  	
   

  	
  25%

  	
   

  	
  50%

  	
   

  	
  100%

  



 


 


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, at its September quarterly
meeting, annually approves an operating and capital budget for the following
fiscal year.  Each financial measure is
then assigned threshold, target and reach objectives based upon this approved
budget.  The target objective is set so
that there is an approximate 66 percent probability of reaching that objective,
with threshold and reach objectives adjusted 20% below and 30% above the target
objective.  After the end of the fiscal
year, actual financial results are then compared to the predetermined
objectives for each of the financial measures to determine the amount of any
bonus.  In the event actual financial
results fall between the threshold and target or the target and reach
objectives, then the bonus shall be proportionately increased as a result of
the threshold or target objective being exceeded.


 


Strategic Performance
Objectives


 


The bonus, if any, derived from the Company’s
financial performance may then be adjusted by a maximum of 50% as determined by
the Committee (“adjustment factor”). 
Eighty percent of this adjustment factor is based upon the Committee’s
subjective evaluation of the Company’s total shareholder return relative to an
industry peer group.  The remaining 20%
of this adjustment factor is based upon the Committee’s subjective evaluation
of the Company’s goal of attaining higher than industry average utilization and
premium day rates.


 


The adjustment factor is subject to a pre-determined
safety performance threshold.  If this safety
performance threshold is not met, then the bonus would not be subject to
increase 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, the bonus may be decreased by the adjustment factor even if the
safety performance threshold is met.


 


Negative Discretion


 


Notwithstanding the provisions of this Annual Bonus
Plan for Executive Officers, the Committee shall have the right to reduce or
eliminate any bonus otherwise due under this Plan based upon its subjective
determination of individual performance.


 


 


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