Exhibit 10.1
INDEMNIFICATION AGREEMENT
INDEMNIFICATION AGREEMENT, effective on the [ ] day of [ ] (this “Agreement”),
by and between BAKER HUGHES COMPANY a Delaware corporation (the “Company”), and
[EMPLOYEE NAME], an individual resident of [ ] (the “Indemnitee”).
WHEREAS, the Company is aware that, in order to induce highly competent persons
to serve the Company as directors or officers or in other capacities, the
Company must provide such persons with adequate protection through insurance and
indemnification against inordinate risks of claims and actions against them
arising out of their service to and activities on behalf of the Company;
WHEREAS, the Company recognizes that the increasing difficulty in obtaining
directors’ and officers’ liability insurance, the increasing cost of such
insurance and the general reductions in coverage of such insurance have made
attracting and retaining such persons more difficult;
WHEREAS, the Company recognizes the substantial increase in corporate litigation
in general, subjecting directors and officers to expensive litigation risks at
the same time as the availability and coverage of liability insurance has been
severely limited;
WHEREAS, the Board of Directors of the Company has determined that it is in the
best interests of the Company and the Company’s stockholders that the Company
act to assure such persons that there will be increased certainty of such
protection in the future;
WHEREAS, it is reasonable, prudent and necessary for the Company to
contractually obligate itself to indemnify, and to advance expenses on behalf
of, such persons to the fullest extent permitted by applicable law and as set
forth in this Agreement so that they will continue to serve the Company free
from undue concern that they will not be so indemnified; and
WHEREAS, the Indemnitee is willing to serve, continue to serve and take on
additional service for or on behalf of the Company or any of its direct or
indirect subsidiaries on the condition that he/she be so indemnified.
NOW, THEREFORE, in consideration of the premises and the mutual promises and
covenants contained herein, and for other good and valuable consideration, the
receipt and sufficiency of which are hereby acknowledged, the Company and the
Indemnitee do hereby agree as follows:
Section 1.Definitions. For purposes of this Agreement:
(a)“Change in Control” shall mean a change in control of the Company occurring
after the date hereof of a nature that would be required to be reported in
response to Item 6(e) of Schedule 14A of Regulation 14A (or in response to any
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item on any similar schedule or form) promulgated under the Securities Exchange
Act of 1934, as amended (the “Act”), whether or not the Company is then subject
to such reporting requirement; provided, however, that, without limitation, a
Change in Control shall include the following:
(i)the acquisition (other than from the Company) by any person, entity or
“group” (within the meaning of Section 13(d)(3) or 14(d)(2) of the Act;
excluding, for this purpose, the Company or its subsidiaries, any employee
benefit plan of the Company or its subsidiaries which acquires beneficial
ownership of voting securities of the Company and any qualified institutional
investor who meets the requirements of Rule 13d-1(b)(1) promulgated under the
Act) of beneficial ownership (within the meaning of Rule 13d-3 promulgated under
the Act), directly or indirectly, of 30% or more of the combined voting power of
the Company’s then outstanding securities, excluding any person, entity or group
that becomes a beneficial owner in connection with a transaction described in
clause ‎(iii)‎(A) below;
(ii)individuals who, as of the date hereof, constitute the Board of Directors of
the Company (the “Board of Directors” and, the Board of Directors as of the date
hereof, the “Incumbent Board”) subsequently ceasing for any reason to constitute
at least a majority of the Board of Directors; provided that, any person
becoming a director subsequent to the date hereof shall be considered a member
of the Incumbent Board for purposes of this Agreement if such person’s
appointment or election by the Board of Directors of the Company or nomination
for election by the Company’s stockholders was approved or recommended by a vote
of at least 2/3 of the directors then comprising the Incumbent Board or whose
appointment, election or nomination for election was previously so approved or
recommended (other than an election or nomination of an individual whose initial
assumption of office is in connection with an actual or threatened election
contest relating to the election of the directors of the Company);
(iii)the consummation of a merger or consolidation of the Company or any direct
or indirect subsidiary of the Company with any other corporation, with respect
to which persons who were the stockholders of the Company immediately prior to
such merger or consolidation, in combination with the ownership of any trustee
or other fiduciary holding securities under an employee benefit plan of the
Company or any “affiliate” (within the meaning of Rule 12b-2 of the General
Rules and Regulations of the Act), do not, immediately thereafter, own at least
50% of the combined voting power of the securities of the Company or such
surviving entity or any parent thereof outstanding, or which is effected to
implement a recapitalization of the Company (or similar transaction) in which no
person, entity or group becomes the beneficial owner, directly or indirectly, of
securities of the Company (not including in the securities beneficially owned by
this person, entity or group any securities acquired directly from the Company
or its affiliates other than in connection with the acquisition by the Company
or its affiliates of a business) representing 30% or more of the combined voting
power of the Company’s then outstanding securities;
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(iv)the consummation of a merger or consolidation of the Company or any direct
or indirect subsidiary of the Company with any other corporation, other than a
merger or consolidation immediately following which the individuals who comprise
the Incumbent Board constitute at least a majority of the Board of Directors of
the Company, the entity surviving such merger or any parent thereof (or a
majority plus one member where such board comprises an odd number of members);
or
(v)the stockholders of the Company approving a plan of complete liquidation or
dissolution of the Company or the consummation of an agreement for the sale or
disposition by the Company of all or substantially all of the assets of the
Company, other than a sale or disposition of all or substantially all of the
assets of the Company to an entity, at least 50% of the combined voting power of
the voting securities of which are owned by the stockholders of the Company in
substantially the same proportions as their ownership of the Company immediately
prior to such sale or where the individuals who comprise the Incumbent Board
constitute at least a majority of the board of directors of such entity or any
parent thereof (or a majority plus one member where such board is comprised of
an odd number of members).
Notwithstanding the foregoing, a “Change in Control” shall not be deemed to have
occurred by virtue of the consummation of any transaction or series of
integrated transactions immediately following which the record holders of the
common stock of the Company immediately prior to such transaction or series of
transactions continue to have substantially the same proportionate ownership in
an entity that owns all or substantially all of the assets of the Company
immediately following such transaction or series of transactions.
(b)“Claim” shall include the following:
(i)any threatened, pending or completed action, suit, proceeding or alternative
dispute resolution mechanism, whether civil, criminal, administrative,
arbitrative, investigative or other, and whether made pursuant to federal, state
or other law; and
(ii)any inquiry, hearing or investigation that the Indemnitee determines might
lead to the institution of any such action, suit, proceeding or alternative
dispute resolution mechanism.
(c)“Disinterested Director” shall mean a director of the Company who is not or
was not a party to the Claim in respect of which indemnification is being sought
by the Indemnitee.
(d)“Expenses” shall include all attorneys’ fees, retainers, court costs,
transcript costs, fees of experts, witness fees, travel expenses, duplicating
costs, printing and binding costs, telephone charges, postage, delivery service
fees, and all other disbursements or expenses incurred in connection with
prosecuting, defending, preparing
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to prosecute or defend, investigating or being or preparing to be a witness in
any Claim. For the avoidance of doubt, Expenses, however, shall not include any
Liabilities.
(e)“Expense Advance” shall mean any payment of Expenses advanced to Indemnitee
or the spouse of the Indemnitee, as applicable, by the Company pursuant to
Sections ‎4, ‎12, and ‎17 hereof.
(f)“Independent Counsel” shall mean a law firm or a member of a law firm that is
experienced in matters of corporate law and neither currently is nor in the five
years previous to its selection or appointment has been retained to represent
the Company or the Indemnitee in any matter material to either such party (other
than in connection with matters concerning Indemnitee under this Agreement or of
other indemnitees under similar indemnification agreements) or any other party
to the action, suit, investigation or proceeding giving rise to a Claim for
indemnification hereunder. Notwithstanding the foregoing, the term “Independent
Counsel” shall not include any person who, under the applicable standards of
professional conduct then prevailing, would have a conflict of interest in
representing either the Company or the Indemnitee in an action to determine the
Indemnitee’s right to indemnification under this Agreement.
(g)“Liabilities” means any losses or liabilities, including any judgments,
fines, excise taxes, penalties and amounts paid in settlement, arising out of or
in connection with any Claim (including all interest, assessments and other
charges paid or payable in connection with or in respect of any such judgments,
fines, excise taxes and penalties, penalties or amounts paid in settlement).
Section 2.Certain References; Interpretation. For the purpose of this Agreement:
(a)Reference to “including” shall mean “including, without limitation,”
regardless of whether the words “without limitation” actually appear.
(b)References to the words “herein,” “hereof” and “hereunder” and other words of
similar import shall refer to this Agreement as a whole and not to any
particular paragraph, subparagraph, section, subsection or other subdivision.
(c)The captions herein are included for convenience of reference only and shall
be ignored in the construction or interpretation hereof.
(d)References to any Person include the successors and permitted assigns of that
Person.
Section 3.Service by the Indemnitee. The Indemnitee agrees to serve as a
director or officer of the Company and will discharge his/her duties and
responsibilities to the best of his/her ability so long as the Indemnitee is
duly elected or qualified in accordance with the provisions of the Amended and
Restated Certificate of Incorporation, as amended (the “Certificate”), and the
Amended and Restated Bylaws, as amended (the “Bylaws”), of the Company and the
General Corporation Law of the State of Delaware, as amended (the “DGCL”), or
until his/her earlier death, retirement, resignation or
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removal. The Indemnitee may at any time and for any reason resign from such
position (subject to any other obligation, whether contractual or imposed by
operation of law), in which event this Agreement shall continue in full force
and effect after such resignation. Nothing in this Agreement shall confer upon
the Indemnitee the right to continue in the employ of the Company (or any of its
affiliates) or as a director of the Company, or affect the right of the Company
to terminate, in the Company’s sole discretion (with or without cause) and at
any time, the Indemnitee’s employment, in each case, subject to any contractual
rights of the Indemnitee created or existing otherwise than under this
Agreement.
Section 4.Indemnification. The Company shall indemnify the Indemnitee against
any and all Expenses and Liabilities and provide Expense Advances to the
Indemnitee as provided in this Agreement to the fullest extent permitted by the
Certificate, the Bylaws in effect as of the date hereof and the DGCL or other
applicable law in effect on the date hereof and to any greater extent that the
DGCL or applicable law may in the future from time to time permit. Without
diminishing the scope of the indemnification provided by this Section ‎4, the
rights of indemnification of the Indemnitee provided hereunder shall include,
but shall not be limited to, those rights hereinafter set forth, except that no
indemnification shall be paid to the Indemnitee:
(a) on account of any Claim in which judgment is rendered against the Indemnitee
for disgorgement of profits made from the purchase or sale by the Indemnitee of
securities of the Company pursuant to the provisions of Section 16(b) of the Act
or similar provisions of any federal, state or local statutory law, or any
reimbursement of the Company by the Indemnitee of any bonus or other
incentive-based or equity-based compensation or of any profits realized by
Indemnitee from the sale of securities of the Company, as required in each case
under the Act (including any such reimbursements that arise from an accounting
restatement of the Company pursuant to Section 304 of the Sarbanes-Oxley Act of
2002 (the “Sarbanes-Oxley Act”), or the payment to the Company of profits
arising from the purchase and sale by Indemnitee of securities in violation of
Section 306 of the Sarbanes-Oxley Act);
(b)on account of conduct of the Indemnitee which is finally adjudged by a court
of competent jurisdiction to have been knowingly fraudulent or to constitute
willful misconduct;
(c)in any circumstance where such indemnification is expressly prohibited by
applicable law;
(d)with respect to liability for which payment is actually made to the
Indemnitee under a valid and collectible insurance policy or under a valid and
enforceable indemnity clause, Bylaw, agreement (other than this Agreement) or
otherwise, except in respect of any liability in excess of payment under such
insurance, clause, Bylaw or agreement;
(e)if a final decision by a court having jurisdiction in the matter shall
determine that such indemnification is not lawful (and, in this respect, both
the Company
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and the Indemnitee have been advised that it is the position of the Securities
and Exchange Commission that indemnification for liabilities arising under the
federal securities laws is against public policy and is, therefore,
unenforceable, and that claims for indemnification should be submitted to the
appropriate court for adjudication); or
(f)in connection with any Claim by the Indemnitee against the Company or any of
its direct or indirect subsidiaries or the directors, officers, employees or
other Indemnitees of the Company or any of its direct or indirect subsidiaries,
unless such indemnification is expressly required to be made by law, unless the
Claim was previously authorized by a majority of the Board of Directors of the
Company, unless such indemnification is provided by the Company, in its sole
discretion, pursuant to the powers vested in the Company under applicable law or
except as provided in Sections ‎13 and ‎15 hereof.
Section 5.Actions or Proceedings Other Than an Action by or in the Right of the
Company. The Indemnitee shall be entitled to the indemnification rights provided
in this ‎Section 5 if the Indemnitee was or is a party or is threatened to be a
party to any Claim, other than an action by or in the right of the Company, by
reason of the fact that the Indemnitee is or was a director, officer or
employee, agent or fiduciary of the Company, or any of its direct or indirect
subsidiaries, or is or was serving at the request of the Company, or any of its
direct or indirect subsidiaries, as a director, officer or employee of any other
entity, including, but not limited to, another corporation, partnership, limited
liability company, employee benefit plan, joint venture, trust or other
enterprise, or by reason of any act or omission by him/her in such capacity.
Pursuant to this ‎Section 5, the Indemnitee shall be indemnified against all
Expenses, judgments and Liabilities which were actually and reasonably incurred
by the Indemnitee in connection with such Claim (including, but not limited to,
the investigation, defense or appeal thereof), if the Indemnitee acted in good
faith and in a manner the Indemnitee reasonably believed to be in or not opposed
to the best interests of the Company, and, with respect to any criminal action
or proceeding, had no reasonable cause to believe his/her conduct was unlawful.
Section 6.Actions by or in the Right of the Company. The Indemnitee shall be
entitled to the indemnification rights provided in this ‎Section 6 if the
Indemnitee was or is a party or is threatened to be made a party to any Claim
brought by or in the right of the Company to procure a judgment in its favor by
reason of the fact that the Indemnitee is or was a director, officer or
employee, agent or fiduciary of the Company, or any of its direct or indirect
subsidiaries, or is or was serving at the request of the Company, or any of its
direct or indirect subsidiaries, as a director, officer or employee of another
entity, including, but not limited to, another corporation, partnership, limited
liability company, employee benefit plan, joint venture, trust or other
enterprise, or by reason of any act or omission by him/her in any such capacity.
Pursuant to this ‎Section 6, the Indemnitee shall be indemnified against all
Expenses and Liabilities actually and reasonably incurred by him/her in
connection with the defense or settlement of such Claim (including, but not
limited to the investigation, defense or appeal thereof), if the Indemnitee
acted in good faith and in a manner the Indemnitee reasonably believed to be in
or not opposed to the best interests of the Company; provided, however, that no
such
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indemnification shall be made in respect of any Claim, issue or matter as to
which the Indemnitee shall have been adjudged to be liable to the Company,
unless and only to the extent that the Court of Chancery of the State of
Delaware or the court in which such Claim was brought shall determine upon
application that, despite the adjudication of liability but in view of all the
circumstances of the case, the Indemnitee is fairly and reasonably entitled to
indemnity for such Expenses which such court shall deem proper.
Section 7.Good Faith Definition. For purposes of this Agreement, the Indemnitee
shall be deemed to have acted in good faith and in a manner the Indemnitee
reasonably believed to be in or not opposed to the best interests of the
Company, or, with respect to any Claim, to have had no reasonable cause to
believe the Indemnitee’s conduct was unlawful, if such action was based on any
of the following: the records or books of the account of the Company or other
enterprise, including financial statements; information supplied to the
Indemnitee by the officers of the Company or other enterprise in the course of
his/her duties; the advice of legal counsel for the Company or other enterprise;
or information or records given in reports made to the Company or other
enterprise by an independent certified public accountant or by an appraiser or
other expert selected with reasonable care by the Company or other enterprise.
Section 8.Indemnification for Expenses of Successful Party. Notwithstanding the
other provisions of this Agreement, to the extent that the Indemnitee has served
on behalf of the Company, or any of its direct or indirect subsidiaries, as a
witness or other participant in any class action or proceeding, or has been
successful, on the merits or otherwise, in defense of any Claim referred to in
Sections ‎5 and ‎6 hereof, or in defense of any Claim, issue or matter therein,
including, but not limited to, the dismissal of any action without prejudice,
the Indemnitee shall be indemnified against all Expenses actually and reasonably
incurred by the Indemnitee in connection therewith.
Section 9.Partial Indemnification. If the Indemnitee is entitled under any
provision of this Agreement to indemnification by the Company for some or a
portion of the Expenses, judgments and Liabilities actually and reasonably
incurred by the Indemnitee in connection with the investigation, defense, appeal
or settlement of such Claim described in Sections ‎5 and ‎6 hereof, but is not
entitled to indemnification for the total amount thereof, the Company shall
nevertheless indemnify the Indemnitee for the portion of such Expenses,
judgments and Liabilities actually and reasonably incurred by the Indemnitee to
which the Indemnitee is entitled.
Section 10.Procedure for Determination of Entitlement to Indemnification. To
obtain indemnification under this Agreement, the Indemnitee shall promptly
submit to the Company a written request of any Claim for which Indemnitee could
seek indemnification hereunder, including documentation and information which is
reasonably available to the Indemnitee and is reasonably necessary to determine
whether and to what extent the Indemnitee is entitled to indemnification. The
Secretary of the Company shall, promptly upon receipt of a request for
indemnification, advise the Board of Directors in writing that the Indemnitee
has requested indemnification. Any Expenses incurred by the Indemnitee in
connection with the Indemnitee’s request for indemnification hereunder shall be
borne by the Company. The Company hereby indemnifies and agrees to hold the
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Indemnitee harmless for any Expenses incurred by the Indemnitee under the
immediately preceding sentence irrespective of the outcome of the determination
of the Indemnitee’s entitlement to indemnification.
(a)Upon written request by the Indemnitee for indemnification pursuant to
Sections ‎5, ‎6 and ‎10 hereof, the entitlement of the Indemnitee to
indemnification pursuant to the terms of this Agreement shall be determined by
the following person or persons, who shall be empowered to make such
determination:
(i)if a Change in Control shall have occurred, by Independent Counsel (unless
the Indemnitee shall request in writing that such determination be made by the
Board of Directors (or a committee thereof) in the manner provided for in clause
‎(b)‎(ii) of this ‎Section 10) in a written opinion to the Board of Directors, a
copy of which shall be delivered to the Indemnitee;
(ii)if a Change in Control shall not have occurred, by the Board of Directors of
the Company, by a majority vote of a quorum consisting of Disinterested
Directors, or if a quorum consisting of Disinterested Directors is not
obtainable, or if a majority vote of a quorum consisting of Disinterested
Directors so directs, by Independent Counsel in a written opinion to the Board
of Directors, a copy of which shall be delivered to the Indemnitee; or
(iii)in any event, by the stockholders pursuant to the Bylaws of the Company.
The Independent Counsel shall be selected by the Board of Directors and approved
by the Indemnitee. Upon failure of the Board of Directors to so select, or upon
failure of the Indemnitee to so approve, the Independent Counsel shall be
selected by the Chancellor of the State of Delaware or such other person as the
Chancellor shall designate to make such selection. Such determination of
entitlement to indemnification shall be made not later than 45 days after
receipt by the Company of a written request for indemnification. If the person
making such determination shall determine that the Indemnitee is entitled to
indemnification as to part (but not all) of the application for indemnification,
such person shall reasonably prorate such part of indemnification among such
claims, issues or matters. If it is so determined that Indemnitee is entitled to
indemnification, payment to Indemnitee shall be made within 10 days after such
determination.
Section 11.Presumptions and Effect of Certain Proceedings. In making a
determination with respect to entitlement to indemnification, the Indemnitee
shall be presumed to be entitled to indemnification hereunder and the Company
shall have the burden of proof in the making of any determination contrary to
such presumption.
(a)If the Board of Directors, or such other person or persons empowered pursuant
to ‎Section 10 to make the determination of whether the Indemnitee is entitled
to indemnification, shall have failed to make a determination as to entitlement
to indemnification within 45 days after receipt by the Company of such request,
the requisite determination of entitlement to indemnification shall be deemed to
have been
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made and the Indemnitee shall be absolutely entitled to such indemnification,
absent an intentional misstatement by Indemnitee of a material fact, or an
intentional omission of a material fact necessary to make Indemnitee’s statement
not materially misleading, in connection with the request for indemnification or
a prohibition of indemnification under applicable law.
The termination of any Claim described in Sections ‎5 and ‎6 hereof by judgment,
order, settlement or conviction, or upon a plea of nolo contendere or its
equivalent, shall not (except as otherwise expressly provided in this
Agreement), of itself:
(i)create a presumption that the Indemnitee did not act in good faith and in a
manner which he/she reasonably believed to be in or not opposed to the best
interests of the Company, or, with respect to any criminal action or proceeding,
that the Indemnitee has reasonable cause to believe that the Indemnitee’s
conduct was unlawful; or
(ii)otherwise adversely affect the rights of the Indemnitee to indemnification.
Section 12.Advancement of Expenses. Subject to applicable law, all reasonable
Expenses actually incurred by the Indemnitee in connection with any Claim shall
be paid by the Company in advance of the final disposition of such Claim, if so
requested by the Indemnitee (including when such request is on behalf of
Indemnitee’s spouse), within 20 days after the receipt by the Company of a
statement or statements from the Indemnitee requesting such Expense Advances.
The Indemnitee may submit such statements from time to time and at such time(s)
as Indemnitee deems appropriate in his or her sole discretion. The Indemnitee’s
entitlement to Expense Advances shall include those incurred in connection with
any proceeding by the Indemnitee seeking an adjudication or award in arbitration
pursuant to this Agreement. Such statement or statements shall reasonably
evidence the Expenses incurred by the Indemnitee in connection therewith and
shall include or be accompanied by a written affirmation by the Indemnitee of
the Indemnitee’s good faith belief that the Indemnitee has met the standard of
conduct necessary for indemnification under this Agreement and an undertaking by
or on behalf of the Indemnitee to repay such amount if it is determined by final
judgment or other final adjudication under the provisions of any applicable law
(as to which all rights of appeal therefrom have been exhausted or lapsed) that
the Indemnitee is not entitled to be indemnified against such Expenses by the
Company pursuant to this Agreement or otherwise. Each written undertaking to pay
amounts advanced must be an unlimited general obligation but need not be
secured, and shall be accepted without reference to financial ability to make
repayment.
Section 13.Remedies of the Indemnitee in Cases of Determination not to Indemnify
or to Advance Expenses. In the event that a determination is made that the
Indemnitee is not entitled to indemnification hereunder or if the payment has
not been timely made following a determination of entitlement to indemnification
pursuant to Sections ‎10 and ‎11, or if Expenses are not advanced pursuant to
‎Section 12, the Indemnitee shall be entitled to a final adjudication in an
appropriate court of the State of
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Delaware or any other court of competent jurisdiction of the Indemnitee’s
entitlement to such indemnification or advance. Alternatively, the Indemnitee
may, at the Indemnitee’s option, seek an award in arbitration to be conducted by
a single arbitrator chosen by the Indemnitee and approved by the Company, which
approval shall not be unreasonably withheld or delayed. If the Indemnitee and
the Company do not agree upon an arbitrator within 30 days following notice to
the Company by the Indemnitee that it seeks an award in arbitration, the
arbitrator will be chosen pursuant to the rules of the American Arbitration
Association (the “AAA”). The arbitration will be conducted pursuant to the rules
of the AAA and an award shall be made within 60 days following the filing of the
demand for arbitration. The arbitration shall be held in Houston, Harris County,
Texas. The Company shall not oppose the Indemnitee’s right to seek any such
adjudication or award in arbitration or any other claim. Such judicial
proceeding or arbitration shall be made de novo, and the Indemnitee shall not be
prejudiced by reason of a determination (if so made) that the Indemnitee is not
entitled to indemnification. If a determination is made or deemed to have been
made pursuant to the terms of Section ‎10 or ‎11 hereof that the Indemnitee is
entitled to indemnification, the Company shall be bound by such determination
and shall be precluded from asserting that such determination has not been made
or that the procedure by which such determination was made is not valid, binding
and enforceable. The Company further agrees to stipulate in any such court or
before any such arbitrator that the Company is bound by all the provisions of
this Agreement and is precluded from making any assertions to the contrary. If
the court or arbitrator shall determine that the Indemnitee is entitled to any
indemnification hereunder, the Company shall pay all reasonable Expenses
actually incurred by the Indemnitee in connection with such adjudication or
award in arbitration (including, but not limited to, any appellate proceedings).
Section 14.Notification and Defense of Claim. Promptly after receipt by the
Indemnitee of notice of the commencement of any Claim, the Indemnitee will, if a
Claim in respect thereof is to be made against the Company under this Agreement,
notify the Company in writing of the commencement thereof. The omission by the
Indemnitee to so notify the Company will not relieve the Company from any
liability that it may have to the Indemnitee under this Agreement or otherwise,
except to the extent that the Company may suffer material prejudice by reason of
such failure. Notwithstanding any other provision of this Agreement, with
respect to any such Claim as to which the Indemnitee gives notice to the Company
of the commencement thereof:
(a)The Company will be entitled to participate in the defense of such Claim at
its own expense.
(b)Except as otherwise provided in this ‎Section 14(b), to the extent that it
may wish, the Company, jointly with any other indemnifying party similarly
notified, shall be entitled to assume the defense thereof with counsel
reasonably satisfactory to the Indemnitee. After notice from the Company to the
Indemnitee of its election to so assume the defense thereof, the Company shall
not be liable to the Indemnitee under this Agreement for any legal or other
Expenses subsequently incurred by the Indemnitee in connection with the defense
thereof other than reasonable costs of investigation or as otherwise provided
below.
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The Indemnitee shall have the right to employ the Indemnitee’s own counsel in
such Claim (but not more than one law firm plus, if applicable, local counsel in
respect of any such Claim), but the fees and Expenses of such counsel incurred
after notice from the Company of its assumption of the defense thereof shall be
at the expense of the Indemnitee unless the employment of counsel by the
Indemnitee has been authorized by the Company, the Indemnitee shall have
reasonably concluded that there may be a conflict of interest between the
Company and the Indemnitee in the conduct of the defense of such Claim and such
determination by the Indemnitee shall be supported by an opinion of counsel,
which opinion shall be reasonably acceptable to the Company, or the Company
shall not in fact have employed counsel to assume the defense of such Claim, in
each of which cases the fees and Expenses of counsel shall be at the expense of
the Company. The Company shall not be entitled to assume the defense of any
Claim brought by or on behalf of the Company or as to which the Indemnitee shall
have reached the conclusion provided for in clause ‎(ii) above.
(c)The Company shall not be liable to indemnify the Indemnitee under this
Agreement for any amounts paid in settlement of any Claim without the Company’s
prior written consent, which consent shall not be unreasonably withheld. The
Company shall not be required to obtain the consent of the Indemnitee to settle
any Claim which the Company has undertaken to defend if the Company assumes full
and sole responsibility for such settlement and such settlement grants the
Indemnitee a complete and unqualified release in respect of any potential
liability.
Section 15.Other Right to Indemnification. The indemnification and Expense
Advances provided by this Agreement are cumulative, and not exclusive, and are
in addition to any other rights to which the Indemnitee may now or in the future
be entitled under any provision of the Bylaws or Certificate of the Company, the
Certificate or Bylaws or other governing documents of any direct or indirect
subsidiary of the Company, any vote of the stockholders or Disinterested
Directors, any provision of applicable law or otherwise. Except as required by
applicable law, the Company shall not adopt any amendment to its Bylaws or
Certificate the effect of which would be to deny, diminish or encumber the
Indemnitee’s right to indemnification under this Agreement.
Section 16.Director and Officer Liability Insurance. The Company shall, from
time to time, make the good faith determination whether or not it is practicable
for the Company to obtain and maintain a policy or policies of insurance with
reputable insurance companies providing the officers and directors of the
Company, and any direct or indirect subsidiary of the Company, with coverage for
losses from wrongful acts, or to ensure the Company’s performance of its
indemnification obligations under this Agreement. Among other considerations,
the Company will weigh the costs of obtaining such insurance coverage against
the protection afforded by such coverage. Notwithstanding the foregoing, the
Company shall have no obligation to obtain or maintain such insurance if the
Company determines in good faith that such insurance is not necessary or is not
reasonably available, if the premium costs for such insurance are
disproportionate to the amount of coverage provided, if the coverage provided by
such insurance is limited by exclusions so as to provide an insufficient benefit
or if the
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Indemnitee is covered by similar insurance maintained by a direct or indirect
subsidiary of the Company. However, the Company’s decision whether or not to
adopt and maintain such insurance shall not affect in any way its obligations to
indemnify its officers and directors under this Agreement or otherwise. In all
policies of director and officer liability insurance, the Indemnitee shall be
named as an insured in such a manner as to provide the Indemnitee the same
rights and benefits as are accorded to the most favorably insured of the
Company’s directors, if the Indemnitee is a director; or of the Company’s
officers, if the Indemnitee is not a director of the Company, but is an officer.
The Company agrees that the provisions of this Agreement shall remain in effect
regardless of whether liability or other insurance coverage is at any time
obtained or retained by the Company; except that any payments made to, or on
behalf of, the Indemnitee under an insurance policy, the Certificate, Bylaws or
otherwise of the amounts otherwise indemnifiable (or for which Expense Advances
are provided) by the Company shall reduce the obligations of the Company
hereunder.
Section 17.Spousal Indemnification. The Company will indemnify the Indemnitee’s
spouse to whom the Indemnitee is legally married at any time the Indemnitee is
covered under the indemnification provided in this Agreement (even if the
Indemnitee did not remain married to him or her during the entire period of
coverage) against any Claim for the same period where such legal marriage and
coverage of the Indemnitee’s indemnification overlap, to the same extent and
subject to the same standards, limitations, obligations and conditions under
which the Indemnitee is provided indemnification herein, if the Indemnitee’s
spouse (or former spouse) becomes involved in a Claim solely by reason of his or
her status as the Indemnitee’s spouse, including, without limitation, any Claim
that seeks damages recoverable from marital community property, jointly-owned
property or property purported to have been transferred from the Indemnitee to
his/her spouse (or former spouse). Subject to the limitations described in this
‎Section 17, the Indemnitee’s spouse or former spouse also may be entitled to
Expense Advances to the same extent that the Indemnitee is entitled to Expense
Advances herein. The Company may maintain insurance to cover its obligation
hereunder with respect to the Indemnitee’s spouse (or former spouse) or set
aside assets in a trust or escrow funds for that purpose.
Section 18.Intent. This Agreement is intended to be broader than any statutory
indemnification rights applicable in the State of Delaware and shall be in
addition to any other rights the Indemnitee may have under the Company’s
Certificate, Bylaws, applicable law or otherwise. To the extent that a change in
applicable law (whether by statute or judicial decision) permits greater
indemnification by agreement than would be afforded currently under the
Company’s Certificate, Bylaws, applicable law or this Agreement, it is the
intent of the parties that the Indemnitee enjoy by this Agreement the greater
benefits so afforded by such change.
Section 19.Attorney’s Fees and Other Expenses to Enforce Agreement. In the event
that the Indemnitee is subject to or intervenes in any proceeding in which the
validity or enforceability of this Agreement is at issue or seeks an
adjudication or award in arbitration to enforce the Indemnitee’s rights under
(or to recover damages for breach of) this Agreement, the Indemnitee, if he/she
prevails in whole or in part in such action,
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shall be entitled to recover from the Company and shall be indemnified by the
Company against any actual expenses for attorneys’ fees and disbursements
reasonably incurred by the Indemnitee.
Section 20.Subrogation. In the event of payment under this Agreement, the
Company shall be subrogated to the extent of such payment to all of the rights
of recovery of the Indemnitee, who shall execute all documents required and
shall do all acts that may be necessary to secure such rights and to enable the
Company effectively to bring suit to enforce such rights.
Section 21.Effective Date. The provisions of this Agreement shall cover Claims
whether now pending or hereafter commenced and shall be retroactive to cover
acts or omissions or alleged acts or omissions which heretofore have taken
place. The Company shall be liable under this Agreement, pursuant to Sections ‎5
and ‎6 hereof, for all acts of the Indemnitee while serving as a director and/or
officer of the Company, notwithstanding the termination of the Indemnitee’s
service and other exceptions described in this Agreement, if such act was
performed or omitted to be performed during the term of the Indemnitee’s service
to the Company.
Section 22.Duration of Agreement. This Agreement shall continue until and
terminate upon the later of: ten years after the Indemnitee has ceased to occupy
any of the positions or have any relationships described in Sections ‎5 and ‎6
of this Agreement and the final termination of all Claims to which the
Indemnitee may be subject by reason of the fact that he/she is or was a
director, officer, employee, agent or fiduciary of the Company, or any direct or
indirect subsidiary of the Company, or is or was serving at the request of the
Company as a director, officer, employee of any other entity, including, but not
limited to, another corporation, partnership, limited liability company,
employee benefit plan, joint venture, trust or other enterprise, or by reason of
any act or omission by the Indemnitee in any such capacity. Subject to the terms
of this Agreement, the indemnification provided under this Agreement shall
continue as to the Indemnitee even though he/she may have ceased to be a
director or officer of the Company, or any direct or indirect subsidiary of the
Company. This Agreement shall be binding upon the Company and its successors and
assigns, including, without limitation, any corporation or other entity which
may have acquired all or substantially all of the Company’s assets or business
or into which the Company may be consolidated or merged, and shall inure to the
benefit of the Indemnitee and his/her spouse, successors, assigns, heirs,
devisees, executors, administrators or other legal representations. The Company
shall require any successor or assignee (whether direct or indirect, by
purchase, merger, consolidation or otherwise) to all or substantially all of the
business and/or assets of the Company, by written agreement in form and
substance reasonably satisfactory to the Company and the Indemnitee, expressly
to assume and agree to perform this Agreement in the same manner and to the same
extent that the Company would be required to perform if no such succession or
assignment had taken place.
Section 23.Disclosure of Payments. Except as expressly required by any federal
securities laws or other federal or state law, neither party hereto shall
disclose any payments under this Agreement unless prior approval of the other
party is obtained.
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Section 24.Severability. If any term or other provision (including any portion
thereof) of this Agreement shall be held invalid, illegal or unenforceable by a
court of competent jurisdiction for any reason whatsoever, the validity,
legality and enforceability of the remaining provisions of this Agreement
(including, but not limited to, all portions of any Sections of this Agreement
containing any such provision held to be invalid, illegal or unenforceable)
shall not in any way be affected or impaired thereby and to the fullest extent
possible, the provisions of this Agreement (including, but not limited to, all
portions of any paragraph of this Agreement containing any such provision held
to be invalid, illegal or unenforceable, that are not themselves invalid,
illegal or unenforceable) shall be construed so as to give effect to the intent
manifest by the provision held invalid, illegal or unenforceable.
Section 25.Counterparts. This Agreement may be executed by one or more
counterparts, each of which shall for all purposes be deemed to be an original
but all of which together shall constitute one and the same agreement. Only one
such counterpart signed by the party against whom enforceability is sought shall
be required to be produced to evidence the existence of this Agreement.
Section 26.Captions. The captions and headings used in this Agreement are
inserted for convenience only and shall not be deemed to constitute part of this
Agreement or to affect the construction or interpretation thereof.
Section 27.Entire Agreement, Modification and Waiver. This Agreement and the
exhibits and documents referred to herein constitute the entire agreement and
understanding of the parties hereto regarding the subject matter hereof, and no
supplement, modification or amendment of this Agreement shall be binding unless
executed in writing by both parties hereto. No waiver of any of the provisions
of this Agreement shall be binding unless in the form of a writing signed by the
party against whom enforcement of the waiver is sought, and no waiver of any of
the provisions of this Agreement shall be deemed or shall constitute a waiver of
any other provisions hereof (whether or not similar), nor shall such waiver
constitute a continuing waiver. No supplement, modification or amendment to this
Agreement shall limit or restrict any right of the Indemnitee under this
Agreement in respect of any act or omission of the Indemnitee prior to the
effective date of such supplement, modification or amendment unless expressly
provided therein. Except as specifically provided herein, no failure to exercise
or any delay in exercising any right, remedy, power or privilege hereunder shall
constitute a waiver thereof.
Section 28.Notices. All notices, requests, demands or other communications
hereunder shall be in writing and shall be deemed to have been duly given if
delivered by hand with receipt acknowledged by the party to whom said notice or
other communication shall have been directed, mailed by certified or registered
mail, return receipt requested with postage prepaid, on the date shown on the
return receipt or delivered by facsimile transmission on the date shown on the
facsimile machine report:
(a)If to the Indemnitee, to:
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(b)If to the Company, to:
Baker Hughes Company Attn: General Counsel17021 Aldine Westfield Rd. Houston,
Texas 77073 Facsimile: (713) 439-8472
or to such other address as may be furnished to the Indemnitee by the Company or
to the Company by the Indemnitee, as the case may be.
Section 29.Governing Law. The parties hereto agree that this Agreement shall be
governed by, and construed and enforced in accordance with the laws of the State
of Delaware, applied without giving effect to any conflicts of law principles.
Section 30.Compliance With Section 409A. Notwithstanding any other provision of
this Agreement, to the extent that any payment hereunder is not exempt from
section 409A of the Internal Revenue Code of 1986, as amended (the “Code”),
pursuant to the application of Department of Treasury Regulation Section
1.409A-1(b)(10) or another applicable exemption (a “409A Payment”), the
following provisions of this Section 30 shall apply with respect to such 409A
Payment. The Company shall make a 409A Payment due under this Agreement at the
time specified above in this Agreement. The parties intend and agree that such
payment deadline is not to be extended as a result of the following sentence,
which is included solely for the purpose of complying with Section 409A of the
Code. The Company shall make a 409A Payment by the last day of the taxable year
of the Indemnitee or the spouse of the Indemnitee, as applicable, following the
taxable year in which the applicable legal fees and expenses were incurred. The
legal fees or expenses that are subject to reimbursement pursuant to this
Agreement shall not be limited as a result of when the fees or expenses are
incurred. The amounts of legal fees or expenses that are eligible for
reimbursement pursuant to this Agreement during a given taxable year of the
Indemnitee or the spouse of the Indemnitee, as applicable, shall not affect the
amount of expenses eligible for reimbursement in any other taxable year. The
right to reimbursement pursuant to this Agreement is not subject to liquidation
or exchange for another benefit.
[Signature page follows]
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IN WITNESS WHEREOF, the parties hereto have executed this Agreement to be
effective on the day and year first above written.

BAKER HUGHES COMPANYBy:

Name:

Title:

INDEMNITEE:By:

Name:

Title:

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