UNITED STATES SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15 (d)
of the Securities Exchange Act of 1934
Date of Report (Date of earliest event reported): February 26, 2007
McDERMOTT INTERNATIONAL, INC.
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(Exact name of registrant as specified in its charter)
REPUBLIC OF PANAMA 001-08430 72-0593134
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(State or other jurisdiction (Commission (IRS Employer
of incorporation) File Number) Identification No.)
777 N. Eldridge Parkway, Houston, Texas 77079
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(Address of principal executive offices) (Zip Code)
Registrant's Telephone Number, including Area Code: (281) 870-5901
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(Former name or former address, if changed since last report)
Check the appropriate box below if the Form 8-K filing is intended to
simultaneously satisfy the filing obligation of the registrant under any of the
following provisions:
|_| Written communications pursuant to Rule 425 under the Securities Act
(17 CFR 230.425)
|_| Soliciting material pursuant to Rule 14a-12 under the Exchange Act
(17 CFR 240.14a-12)
|_| Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange
Act (17 CFR 240.14d-2(b))
|_| Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange
Act (17 CFR 240.13e-4(c))
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Item 5.02 Compensatory Arrangements of Certain Officers.
(e) The Compensation Committee of our Board of Directors administers the
Executive Incentive Compensation Plan ("EICP"), a cash bonus plan under which
our executive officers participate. The payment amount, if any, of an EICP award
is determined based on: (1) the attainment of financial performance measures,
(2) the attainment of individual performance measures, and (3) the exercise of
the Compensation Committee's discretionary authority.
On February 26, 2007, our Compensation Committee established 2007 target
award opportunities and confidential financial performance measures relative to
those opportunities for our named executive officers, Messrs. Bruce W.
Wilkinson, Robert A. Deason, John A. Fees, Francis S. Kalman and John T. Nesser
III. For the year ending December 31, 2007, the target award opportunities for
these named executive officers are as follows:
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Named Executive Officer Target Award Opportunity (as a
percentage of 2007 base salary)
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Bruce W. Wilkinson 100%
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Robert A. Deason 70%
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John A. Fees 70%
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Francis S. Kalman 65%
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John T. Nesser, III 65%
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For 2007, 85% of the target award opportunity is attributable to financial
performance measures established by the Compensation Committee and 15% of the
target award opportunity is attributable to individual performance measures
determined by our Chief Executive Officer. The Compensation Committee retained
its discretion to award additional amounts under the EICP, up to 15% of the
target award opportunity.
The Compensation Committee established three levels of financial
performance for determining the minimum, target and maximum payment under the
financial performance component of the 2007 EICP award for these named executive
officers. For our 2007 EICP awards, our Compensation Committee set the levels of
financial performance based upon year-over-year increases in our consolidated
operating income. For Messrs. Deason and Fees, the Compensation Committee
divided the financial performance measure, with 65% attributable to the
operating income of their respective business unit, J. Ray McDermott, S.A. or
The Babcock & Wilcox Companies, respectively, and 20% attributable to
McDermott's consolidated operating income.
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.
McDERMOTT INTERNATIONAL, INC.
By: /s/Michael S. Taff
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Michael S. Taff
Vice President and Chief Accounting Officer
March 2, 2007