Document:

Plans 2006

    Exhibit
      10.1

    

    ROWAN
      COMPANIES, INC.

    2006
      PROFIT SHARING PLAN

     

     

    
      
        	
                Who
                  is eligible? 

                 

              	
                All
                  previous corporate or drilling division option recipients, plus
                  all other
                  qualifying division office employees (approximately 330 total
                  employees).

                 

              
	
                What
                  is profit sharing?

                 

              	
                Depending
                  on the performance of the Company, a pool of funds will be established
                  to
                  be paid to eligible employees. 

                 

              

      

    

    
      
        	
                How
                  is the pool determined?

                 

              	
                The
                  pool is funded based on achievement of Earnings Before Interest,
                  Taxes,
                  Depreciation and Amortization (EBITDA) for the Drilling Division.
                  If we
                  have at least 20% EBITDA return on Drilling Division revenues (“Margin”)
                  and the Company has a positive net income (excluding asset sales),
                  then
                  the pool is funded (on a sliding scale) as follows: 

                 

              

      

    

    
      
        	
                %
                  EBITDA Margin

              	 	
                Pool
                  Funding

              
	
                20%

              	 	
                1%
                  of EBITDA

              
	
                25%

              	 	
                2.33%
                  of EBITDA

              
	
                30%

              	 	
                3.66%
                  of EBITDA

              
	
                35%
                  or more

              	 	
                5%
                  of EBITDA (max pool)

              

      

    

    
       

    

    
      
        	
                How
                  much of the pool will I receive?

                 

              	
                Pool
                  dollars are allocated to eligible employees in proportion
                  to base pay. All eligible employees receive the same percentage
                  of their
                  base pay. 

                 

              
	
                What
                  is base pay?

                 

              	
                Normal
                  salary/wage compensation, including any overtime pay
                  (excludes any bonus and/or stock option value).

                 

              
	
                What
                  is the maximum payout possible?

                 

              	
                The
                  2006 pool of funds will be capped at 20% of the base pay of
                  all eligible employees taken together.

                 

              

      

    

     

    
 

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    ROWAN
      COMPANIES, INC.

    2006
      BONUS PLAN

    

     

    

      
        	
                Who
                  is eligible? 

                 

              	
                Executive
                  and other officers, managers and certain key
                  employees (approximately 80 employees).

                 

              
	
                What
                  is my target bonus?

                 

              	
                A
                  percentage of your base pay depending on your
                  salary/responsibility level. Target bonuses under the plan range
                  from 15%
                  to 75% of base pay. 

                 

              
	
                How
                  is payout of my bonus determined?

                 

              	
                There
                  are two pieces of the bonus plan: 

                 

                ·  Nondiscretionary
                  portion (50% of your target): Based on achievement of Drilling
                  EBITDA.

                 

                ·  Discretionary
                  portion (50% of your target): This portion varies by individual and
                  will be based on your performance and achievement of your individual
                  and
                  group goals. The payout of this portion of your bonus will be in
                  the
                  discretion of the Compensation Committee of the Board of Directors.

                 

              
	
                What
                  is the highest/lowest bonus I may
                  receive?

                 

              	
                Payout
                  will be between zero and 200% of your target depending
                  on the achievement of Drilling EBITDA and your individual/group
                  goals. The
                  two portions of the bonus plan are independent of each other. 

                 

              
	
                What
                  is Drilling EBITDA?

                 

              	
                GAAP-based
                  EBITDA from Drilling segment operations, relative to
                  the 2006 budget approved by the Board of Directors. 

                 

              
	
                How
                  is the payout of the nondiscretionary portion
                  calculated:

              	
                If
                  the Company has positive net income on a consolidated basis
                  and Drilling EBITDA of at least 75% of budget, all after profit
                  sharing
                  payout, then payment will be calculated (on a sliding scale) as
                  follows:
                  

              

      

       

      
        
          	
                  %
                    of Budget 

                  Drilling
                    EBITDA

                	
                  %
                    of payout of 

                  nondiscretionary
                    portion

                
	
                  75%
                    or less

                	
                  No
                    payout

                   

                
	
                  87.5
                    %

                	
                  50%
                    of target

                   

                
	
                  100%

                   

                	
                  100%
                    of target

                   

                
	
                  112.5%

                   

                	
                  150%
                    of target

                   

                
	
                  125%
                    or more

                   

                	
                  200%
                    of target

                   

                

        

      

      

        
          	
                  How
                    does profit sharing fit in with the bonus
                    plan? 

                   

                	
                  Any
                    award under the bonus plan is offset by any profit sharing award
                    you
                    receive. Two times your target under the bonus plan is the maximum
                    bonus
                    you will receive in a year. 

                   

                

        

        

      

     

    -2-Exhibit 10(a)1

SECOND AMENDMENT TO

THE SOUTHERN COMPANY

DEFERRED COMPENSATION PLAN

WHEREAS, the Board of Directors of Southern Company Services, Inc. (the “Company”) heretofore established and adopted the Southern Company Deferred Compensation Plan, as amended and restated effective January 1, 2004 (the “Plan”); and

WHEREAS, Section 8.3 of the Plan provides that the Plan may be amended or modified at any time by the Company; and

WHEREAS, the Company has authorized its officers to amend the Plan to name new officer positions, and any successors thereto, to serve on the Committee; and

WHEREAS, officer positions appointed to the Committee shall assume such duties as of the later of March 1, 2006 or the date such officer position is filled, provided any officer previously appointed to the Committee designated as a successor to such appointed status pursuant to this amendment shall continuously retain member status on the Committee since the time of his original appointment; and

WHEREAS, the Company desires to clarify the Committee's authority to amend the Plan.

NOW, THEREFORE, effective March 1, 2006, the Company hereby amends the Plan as follows:

1. 

The Plan is amended to delete existing Section 3.1 and replace it with the following:

	
             
 	
            3.1         The general administration of the Plan shall be placed in the Committee. The Committee shall consist of the Senior Vice President, Human Resource Services, Southern Company Services, Inc. (which position is the successor to the Vice President, System Compensation and Benefits, Southern Company Services, Inc.); the Chief Financial Officer, Southern Company Services, Inc.; the Vice President, Tax, Southern Company Services, Inc.; and the Comptroller of Southern Company; or any other position or positions that succeed to the duties of the foregoing positions.  Any member may resign or may be removed by the Board of Directors and new members may be appointed by the Board of Directors at such time or times as the Board of Directors in its discretion shall determine.
The Committee shall be chaired by the Senior Vice President, Human Resource Services, Southern Company Services, Inc. and may select a Secretary (who may, but need not, be a member of the Committee) to keep its records or to assist it in the discharge of its duties. A majority of the members of the Committee shall constitute a quorum for the transaction of business at any meeting. Any determination or action of the Committee may be made or taken by a majority of the members present at any meeting thereof, or without a meeting by resolution or written memorandum concurred in by a majority of the members.
 	
             
 

 

 

 

 

 

2. 

The Plan is amended to delete the last full sentence in Section 8.3 and replace such sentence with the following:

	
             
 	
            The Plan may also be amended by the Committee (a) if such amendment does not involve a substantial increase in cost to any Employing Company, or (b) as may be necessary, proper, or desirable in order to comply with laws or regulations enacted or promulgated by any federal or state governmental authority.
 	
             
 

3. 

Except as amended herein, by this Second Amendment, the Plan shall remain in full force and effect as amended and restated by the Company.

IN WITNESS WHEREOF, the Company, through its duly authorized officer, has adopted the Second Amendment to the Southern Company Deferred Compensation Plan, as amended and restated as of January 1, 2004, this 21st day of March, 2006.

 

	
             
 	
            SOUTHERN COMPANY SERVICES, INC.

 
 
	
            Attest:
 	
            By:  /s/Robert A. Bell                                  
 
	
            /s/Dennis A. Stone                          

Secretary
 	
            Its:  SVP, Human Resource Services
 
	
             
 	
             
 
	
             
 	
             
 

 

 

 

2

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