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| ¨                                                                   |   | Preliminary Proxy Statement |
|                                                                     |   |
| ¨                                                                   |   | Confidential, for Use of the Commission Only (as permitted by Rule 14a-6(e)(2)) |
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| x                                                                        |   | Definitive Proxy Statement |
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| ¨                                                                   |   | Definitive Additional Materials |
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| ¨                                                                   |   | Soliciting Material Pursuant to §240.14a-12 |
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| BAKER HUGHES INCORPORATED                                                |
| (Name of registrant as specified in its charter)                         |
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| (Name of person(s) filing proxy statement, if other than the registrant) |
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| Payment of Filing Fee (Check the appropriate box):                       |
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| x                                                                        |   | No fee required. |
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| ¨                                                                   |   | Fee computed on table below per Exchange Act Rules 14a-6(i)(4) and 0-11. |
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|                                                                     |   | (1 | ) |   | Title of each class of securities to which transaction applies:   |
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|                                                                     |   | (2 | ) |   | Aggregate number of securities to which transaction applies:   |
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|                                                                     |   | (3 | ) |   | Per unit price or other underlying value of transaction computed pursuant to Exchange Act Rule 0-11 (set forth the amount on which the filing fee is calculated and state how it was determined):   |
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|                                                                     |   | (4 | ) |   | Proposed maximum aggregate value of transaction:   |
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|                                                                     |   | (5 | ) |   | Total fee paid: |
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| ¨                                                                   |   | Fee paid previously with preliminary materials. |
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| ¨                                                                   |   | Check box if any part of the fee is offset as provided by Exchange Act Rule 0-11(a)(2) and identify the filing for which the offsetting fee was paid previously. Identify the previous filing by registration statement number, or the Form or Schedule and the date of its filing. |
|                                                                     |   |   |
|                                                                     |   | (1) |   | Amount Previously Paid:   |
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|                                                                     |   | (2) |   | Form, Schedule or Registration Statement No.:   |
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|                                                                     |   | (3) |   | Filing Party:   |
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|                                                                     |   | (4) |   | Date Filed:   |

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|    |                            |
|----|----------------------------|
| 1. | The election of directors; |

|    |                                                                           |
|----|---------------------------------------------------------------------------|
| 2. | An advisory vote related to the Company's executive compensation program; |

|    |                                                                                                 |
|----|-------------------------------------------------------------------------------------------------|
| 3. | An advisory vote on the frequency of the holding of an advisory vote on executive compensation; |

|    |                                                                                                                                    |
|----|------------------------------------------------------------------------------------------------------------------------------------|
| 4. | The ratification of Deloitte & Touche LLP as the Company's independent registered public accounting firm for fiscal year 2017; |

|    |                                                                                                          |
|----|----------------------------------------------------------------------------------------------------------|
| 5. | A stockholder proposal regarding a majority vote standard for all non-binding stockholder proposals; and |

|    |                                                                                                                      |
|----|----------------------------------------------------------------------------------------------------------------------|
| 6. | Such other business as may properly come before the meeting and any reconvened meeting after an adjournment thereof. |

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|                                                                                                                  |
|------------------------------------------------------------------------------------------------------------------|
|                                                                                                                  |  |
| Proxy Statement                                                                                                  | 1 |
| Voting Securities                                                                                                | 4 |
| Proposal No. 1 Election of Directors                                                                             | 5 |
| Director Compensation                                                                                            | 8 |
| Corporate Governance                                                                                             | 10 |
| Stock Ownership                                                                                                  | 14 |
| Charitable Contributions                                                                                         | 16 |
| Certain Relationships and Related Transactions                                                                   | 16 |
| Compensation Discussion and Analysis                                                                             | 18 |
| Summary Compensation Table                                                                                       | 37 |
| Grants of Plan-Based Awards                                                                                      | 39 |
| Outstanding Equity Awards at Fiscal Year-End                                                                     | 40 |
| Option Exercises and Stock Vested                                                                                | 42 |
| Pension Benefits                                                                                                 | 42 |
| Nonqualified Deferred Compensation                                                                               | 43 |
| Potential Payments Upon Change in Control or Termination                                                         | 43 |
| Compensation Committee Report                                                                                    | 48 |
| Compensation Committee Interlocks and Insider Participation                                                      | 48 |
| Proposal No. 2 Advisory Vote on Executive Compensation                                                           | 49 |
| Proposal No. 3 Advisory Vote on the Frequency of the Holding of an Advisory Vote on Executive Compensation       | 50 |
| Audit/Ethics Committee Report                                                                                    | 51 |
| Fees Paid to Deloitte & Touche LLP                                                                           | 52 |
| Proposal No. 4 Ratification of the Company's Independent Registered Public Accounting Firm                       | 53 |
| Proposal No. 5 Stockholder Proposal Regarding a Majority Vote Standard for All Non-Binding Stockholder Proposals | 54 |
| Annual Report                                                                                                    | 58 |
| Incorporation by Reference                                                                                       | 58 |
| Stockholder Proposals                                                                                            | 58 |
| Other Matters                                                                                                    | 58 |
|                                                                                                             |   |
| Baker Hughes Incorporated Corporate Governance Guidelines                                                        | A-1 |
| Baker Hughes Incorporated Charter of the Audit/Ethics Committee of the Board of Directors                        | B-1 |
| Reconciliation of GAAP Measures to Non-GAAP Measures                                                             | C-1 |

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|                                                                                                                                                   |
|---------------------------------------------------------------------------------------------------------------------------------------------------|
|                                                                                                                                                   |  |  |  |  |  |  |
| Proposal                                                                                                                                          |   | Vote Required |   | Broker Non-Votes |   | Abstentions |
|                                                                                                                                              |   |   |   |   |   |   |
| Election of Directors                                                                                                                             |   | The affirmative vote of the  majority of votes cast with respect to the election of each director. There will be no cumulative voting in the election of directors. |   | No effect on the outcome of the vote |   | Abstentions have no effect on the outcome of the vote |
| The approval of the advisory vote related to the Company's executive compensation program                                                         |   | The affirmative vote of the majority of shares present in person or represented by proxy at the Annual Meeting and entitled to vote on the matter. |   | No effect on the outcome of the vote |   | Abstentions have the same effect as a vote against |
| The approval of the advisory vote on the frequency of the holding of an advisory vote on executive compensation                                   |   | The option of one year, two years or three years that receives the most votes will be deemed to have received the advisory approval of our stockholders. |   | No effect on the outcome of the vote |   | Abstentions have no effect on the outcome of the vote |
| The approval of the ratification of Deloitte & Touche LLP as the Company's independent registered public accounting firm for fiscal year 2017 |   | The affirmative vote of the majority of shares present in person or represented by proxy at the Annual Meeting and entitled to vote on the matter. |   | Brokers may vote on uninstructed shares |   | Abstentions have the same effect as a vote against |
| The approval of the stockholder proposal regarding a majority vote standard for all non-binding stockholder proposals                             |   | The affirmative vote of the majority of shares present in person or represented by proxy at the Annual Meeting and entitled to vote on the matter. |   | No effect on the outcome of the vote |   | Abstentions have the same effect as a vote against |

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|         |                                                                                                              |
|---------|--------------------------------------------------------------------------------------------------------------|
| • | Mr. Craighead's 30 years of experience working for Baker Hughes in various officer and leadership positions; |

|         |                                                                                                                                        |
|---------|----------------------------------------------------------------------------------------------------------------------------------------|
| • | Mr. Brenneman's leadership and financial experience in public companies including his service as a director of other public companies; |

|         |                                                                                                                                                                                                        |
|---------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| • | Mr. Cazalot's role as a former chairman of the board, chief executive officer and president of a publicly traded energy company as well as his many years of experience in the global energy business; |

|         |                                                                                                                                                                                                                                      |
|---------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| • | Mr. Easter's position as former chairman, president and chief executive officer of an energy company, his  years of leadership experience at a global oil and gas company and his experience serving on other public company boards; |

|         |                                                                                                                                                                                                   |
|---------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| • | Ms. Elsenhans' positions as a former chairman and chief executive officer of a publicly traded energy company as well as her many years of leadership experience at a global oil and gas company; |

|         |                                                                                                                                                                                                           |
|---------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| • | Mr. Fernandes' leadership roles in several public companies in the energy and manufacturing sectors, including his service as a director of other public companies and his extensive financial expertise; |

|         |                                                                                                                  |
|---------|------------------------------------------------------------------------------------------------------------------|
| • | Ms. Gargalli's leadership and consulting experience, extensive public board service and her financial expertise; |

|         |                                                                                                                                                      |
|---------|------------------------------------------------------------------------------------------------------------------------------------------------------|
| • | Dr. Jungels' technical knowledge, executive roles, experience in the international energy industry and service as a member of public company boards; |

|         |                                                                                                                                                                             |
|---------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| • | Mr. Lash's engineering skills and knowledge of high technology, as well as his private equity leadership, manufacturing background, public service and financial expertise; |

|         |                                                                                                                                                                                                                          |
|---------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| • | Mr. Nichols' position as the former chairman and chief executive officer of a publicly-traded energy company, a successful career building a major oil and gas company and his leadership in related trade associations; |

|         |                                                                                                                                                 |
|---------|-------------------------------------------------------------------------------------------------------------------------------------------------|
| • | Mr. Stewart's role as the former chairman of the board, president and chief executive officer of a formerly publicly traded energy company; and |

|         |                                                                                                                                                             |
|---------|-------------------------------------------------------------------------------------------------------------------------------------------------------------|
| • | Mr. Watson's executive leadership roles and active involvement in a number of energy-related companies and service as a director of other public companies. |

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|                          |
|--------------------------|
|                          |  |  |  |
| Nominees                 | Principal Occupation | Age | DirectorSince |
|                     |   |   |   |
| Gregory D. Brenneman     | Executive Chairman of CCMP Capital Advisors, LLC (private equity firm) since 2008 and Chairman and Chief Executive Officer of TurnWorks, Inc. (private equity firm) since 1994. Mr. Brenneman is a successful business leader who has been involved in several well-known corporate spin-off and turnaround transformations. He brings an extensive background in general management of large organizations and expertise in accounting and corporate finance, supply chain, marketing and international matters. Mr. Brenneman served as Executive Chairman of Quizno’s Corporation from 2008 to 2010 and as its President and Chief Executive Officer from 2007 to 2008. Prior to joining Quiznos, Mr. Brenneman led restructuring and turnaround efforts at Burger King Corporation, PwC Consulting, a division of PricewaterhouseCoopers, and Continental Airlines, Inc.  Mr. Brenneman currently serves on the Board of Directors of The Home Depot, Inc. and Milacron Holdings Corp. Within the last five years, he served on the Board of Directors of Automatic Data Processing, Inc. and Francesca’s Collections. | 55 | 2014 |
|                     |   |   |   |
| Clarence P. Cazalot, Jr. | Former Executive Chairman of the Board of Marathon Oil Corporation (formerly known as USX Corporation) (diversified petroleum) from August 2013 to December 2013. Chairman of the Board of Marathon Oil Corporation from 2011 to 2013, President, Chief Executive Officer and Director of Marathon Oil Corporation from 2002 to August 2013. He served as Vice Chairman of USX Corporation and President of Marathon Oil Company from 2000 to 2001. Mr. Cazalot served in various executive roles with Texaco Inc. from 1972 to 2000. He is a director of Enbridge, Inc. Additionally, he serves on the Memorial Hermann Health System Board, the Board of Advisors of the James A. Baker III Institute for Public Policy at Rice University, the Board of Visitors of the University of Texas M.D. Anderson Cancer Center and the Board of the LSU Foundation. Within the last five years, Mr. Cazalot served on the Board of FMC Technologies. | 66 | 2002 |
|                     |   |   |   |
| Martin S. Craighead      | Chairman of the Board of Directors of the Company since April 2013 and Director since 2011. Chief Executive Officer of the Company since January 2012 and President since 2010. Chief Operating Officer from 2009 to 2012 and Group President of Drilling and Evaluation from 2007 to 2009. President of INTEQ from 2005 to 2007 and President of Baker Atlas from February 2005 to August 2005. Mr. Craighead held previous roles within the Company since 1986. | 57 | 2011 |
|                     |   |   |   |
| William H.  Easter III   | Former Chairman, President and Chief Executive Officer of DCP Midstream LLC (natural gas gatherers and processors and marketers of natural gas and natural gas liquids) from 2004 to 2008. Mr. Easter worked for ConocoPhillips for more than 30 years where he held senior leadership, operating and commercial roles in areas of natural gas and natural gas liquids, transportation, refining and marketing (domestically and internationally). Mr. Easter served as a director of Sunoco, Inc. from 2011 to 2012 and Sunoco Partners, LLC during 2012. He is a director of Concho Resources Inc., Delta Airlines, Inc. and Memorial Hermann Health System. | 67 | 2014 |

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|                      |
|----------------------|
|                      |  |  |  |
| Nominees             | Principal Occupation | Age | DirectorSince |
|                 |   |   |   |
| Lynn L. Elsenhans    | Former Executive Chairman of Sunoco, Inc. (transportation fuels and logistics) from January 2009 until May 2012, and Chief Executive Officer and President from August 2008 until March 2012. She also served as Chairman of Sunoco Logistics Partners L.P. from October 2008 until May 2012, and Chief Executive Officer from July 2010 until March 2012. She worked at Royal Dutch Shell for more than 28 years where she held a number of senior roles, including Executive Vice President, Global Manufacturing from 2005 to 2008. She is a member of the Board of Directors of GlaxoSmithKline and Flowserve Corporation. She also serves on the Board of the Texas Medical Center, the United Way of Greater Houston, and the First Tee of Greater Houston. | 60 | 2012 |
|                 |   |   |   |
| Anthony G. Fernandes | Former Chairman, President and Chief Executive Officer of Philip Services Corporation (diversified industrial services provider) from August 1999 to April 2002. He was Executive Vice President of ARCO (Atlantic Richfield Company) from 1994 to 1999, President of ARCO Coal, a subsidiary of ARCO, from 1990 to 1994 and Corporate Controller of ARCO from 1987 to 1990. Mr. Fernandes serves on the Board of Directors of ABM Industries, Inc., Envirosystems Inc. and Snack it Forward LLC. Within the past five years, he served on the Board of Directors of Cytec Industries and Black & Veatch. | 71 | 2001 |
|                 |   |   |   |
| Claire W. Gargalli   | Former Vice Chairman, Diversified Search and Diversified Health Search Companies (executive search consultants) from 1990 to 1998. Ms. Gargalli served as President and Chief Operating Officer of Equimark from 1984 to 1990. During that period, she also served as Chairman and Chief Executive Officer of Equimark's two principal subsidiaries, Equibank and Liberty Bank. Ms. Gargalli is a director of BioMotion Analytics. She is also a trustee emeritus of Carnegie Mellon University and Middlebury College. Within the past five years, she was a director of Praxair, Inc. | 74 | 1998 |
|                 |   |   |   |
| Pierre H.  Jungels   | President of the Institute of Petroleum from 2002 until June 2003. From 1997 through 2001, Dr. Jungels served as a Director and Chief Executive Officer of Enterprise Oil, plc. In 1996, Dr. Jungels served as the Managing Director of Exploration and Production at British Gas plc. He held various positions from 1974 to 1995 at PetroFina SA, including Executive Director from 1989 to 1995. Dr. Jungels is the Chairman of Velocys plc. Within the past five years, Dr. Jungels served as a director of Imperial Tobacco Group plc., Woodside Petroleum Ltd. and Rockhopper Exploration plc. | 73 | 2006 |
|                 |   |   |   |
| James A. Lash        | Chairman of Manchester Principal LLC and its predecessor company (high technology venture capital firm) since 1976. Former First Selectman, Greenwich, Connecticut (city government) from 2003 to 2007. Mr. Lash also served as Chairman and Chief Executive Officer of Reading Tube Corporation from 1982 to 1996. Mr. Lash was a director of the East West Institute from 2002 to 2011 and was a trustee of the Massachusetts Institute of Technology from 2000 to 2011. | 72 | 2002 |
|                 |   |   |   |
| J. Larry Nichols     | Chairman Emeritus of Devon Energy Corp. (independent energy company) since June 2016. Mr. Nichols served as Executive Chairman of Devon Energy Corp. from June 2010 to 2016, Chairman from 2000 to 2010 and as Chief Executive Officer from 1980 to 2010. Mr. Nichols serves as a director of SONIC Corp., as well as several trade associations relevant to the oil and gas exploration and production business. | 74 | 2001 |
|                 |   |   |   |
| James W. Stewart     | Former Chairman of the Board of Directors, President and Chief Executive Officer of BJ Services Company (oilfield services) from 1990 until its acquisition by the Company in 2010. Prior to 1990, Mr. Stewart held various management and staff positions with BJ Services Company and its predecessor company. Mr. Stewart is a member of the Board of Directors of BJ Services Company (venture between Baker Hughes Oilfield Operations, Inc. and Allied Completions Holdings, LLC), Delta SubSea LLC, The Alley Theatre of Houston, a Trustee of the Menil Collection and Chair of the Finance Committee of the Menil Collection. | 73 | 2010 |

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|                   |
|-------------------|
|                   |  |  |  |
| Nominees          | Principal Occupation | Age | DirectorSince |
|              |   |   |   |
| Charles L. Watson | Chairman of Twin Eagle Resource Management (energy marketing) since 2010, Chairman and CEO of Advanced Blast Protection Systems since 2015, Chairman of Wincrest Ventures, L.P. (private investments) since January 1994 and senior energy advisor to GSO/Blackstone since 2014. Mr. Watson was Chairman of Eagle Energy (wholesale energy) from 2003 to 2009 and Chairman of Sigma Chi Foundation from 2005 to 2012. He served as a Senior Energy Advisor to Carlyle Investment Management Fund (investment) from 2011 to 2014 and as a Senior Advisor to EDF Trading North America LLC (wholesale energy) and Electricite de France (electric utility) during 2008 and Managing Director of Lehman Brothers (financial services) from 2007 to 2008. He was the Founder, Chairman and Chief Executive Officer of Dynegy Inc. (diversified energy) and its predecessor companies from 1985 to 2002. Mr. Watson is a board member of Mainstream Renewable Power, Baylor College of Medicine, serves on the board of Advisors for Angeleno Investors, L.P., and serves on the Advisory Council for DocuSign. | 67 | 1998 |

|         |                          |
|---------|--------------------------|
| • | Lead Director -  $15,000 |

|         |                                         |
|---------|-----------------------------------------|
| • | Audit/Ethics Committee Chair  - $20,000 |

|         |                                                                                     |
|---------|-------------------------------------------------------------------------------------|
| • | Chair of the Compensation, Finance and Governance and HS&E Committees - $15,000 |

|         |                                                                      |
|---------|----------------------------------------------------------------------|
| • | Members of the Audit/Ethics Committee, excluding the Chair - $10,000 |

|         |                                                                                                            |
|---------|------------------------------------------------------------------------------------------------------------|
| • | Members of the Compensation, Finance and Governance and HS&E Committees, excluding the Chair -  $5,000 |

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|                          |
|--------------------------|
|                          |  |  |  |  |  |  |  |  |  |
| Name                     | Fees Earned or Paid in Cash($) |   | Stock Awards (1)($) | All Other Compensation (2)($) | Total ($) |
| Larry D. Brady           | 110,000 |  |   | 174,997 |  | — |  | 284,997 |  |
| Gregory D. Brenneman     | 113,750 |  |   | 174,997 |  | 2,914 |  | 291,661 |  |
| Clarence P. Cazalot, Jr. | 112,500 |  |   | 174,997 |  | 2,914 |  | 290,411 |  |
| William H. Easter III    | 110,000 |  |   | 174,997 |  | 2,914 |  | 287,911 |  |
| Lynn L. Elsenhans        | 120,000 |  |   | 174,997 |  | 2,914 |  | 297,911 |  |
| Anthony G. Fernandes     | 120,000 |  |   | 174,997 |  | 2,914 |  | 297,911 |  |
| Claire W. Gargalli       | 105,000 |  |   | 174,997 |  | — |  | 279,997 |  |
| Pierre H. Jungels        | 110,000 |  |   | 174,997 |  | 729 |  | 285,726 |  |
| James A. Lash            | 125,000 |  |   | 174,997 |  | 729 |  | 300,726 |  |
| J. Larry Nichols         | 140,000 |  |   | 174,997 |  | — |  | 314,997 |  |
| James W. Stewart         | 105,000 |  |   | 174,997 |  | 729 |  | 280,726 |  |
| Charles L. Watson        | 105,000 |  |   | 174,997 |  | 2,914 |  | 282,911 |  |

|     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                |
|-----|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| (1) | On January 28, 2016, each director received a restricted stock unit award with a grant date value of $175,000, rounded down to the nearest share. The amounts included in the Stock Awards column represent the aggregate grant date fair value of $40.83 per restricted stock unit award computed in accordance with Financial Accounting Standards Board Accounting Standards Codification Topic 718 ("FASB ASC Topic 718"). The value ultimately realized by the director upon the actual vesting of the awards may or may not be equal to the FASB ASC Topic 718 determined value. For a discussion of valuation assumptions, see “Note 7 - Stock-Based Compensation” of the Notes to Consolidated Financial Statements included in our Annual Report under Item 8 of the Form 10-K for the year ended December 31, 2016. |

|     |                                                                                                                                                                            |
|-----|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| (2) | The amount in "All Other Compensation" reflects the dividend equivalents paid or accrued during the year ended December 31, 2016 on unvested restricted stock unit awards. |

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|                          |
|--------------------------|
|                          |  |  |  |  |  |  |
| Name                     | Aggregate Stock Awards Outstanding as of December 31(#) | Aggregate Option Awards Outstanding as of December 31 (#) | Grant Date Fair Value of Stock and Option Awards made during 2016($) |
| Larry D. Brady (1)       | — |  | 10,624 |  | 174,997 |  |
| Gregory D. Brenneman     | 4,286 |  | — |  | 174,997 |  |
| Clarence P. Cazalot, Jr. | 4,286 |  | 10,624 |  | 174,997 |  |
| William H. Easter III    | 4,286 |  | — |  | 174,997 |  |
| Lynn L. Elsenhans        | 4,286 |  | 19,768 |  | 174,997 |  |
| Anthony G. Fernandes     | 4,286 |  | 10,624 |  | 174,997 |  |
| Claire W. Gargalli (1)   | — |  | 10,624 |  | 174,997 |  |
| Pierre H. Jungels (1)    | — |  | 10,624 |  | 174,997 |  |
| James A. Lash (1)        | — |  | 6,953 |  | 174,997 |  |
| J. Larry Nichols (1)     | — |  | 10,624 |  | 174,997 |  |
| James W. Stewart (1)     | — |  | 7,856 |  | 174,997 |  |
| Charles L. Watson        | 4,286 |  | 10,624 |  | 174,997 |  |

|     |                                                                                                                                                                                                                                                                                                                                                                                                                         |
|-----|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| (1) | Per the terms and conditions of the director restricted stock unit awards granted on January 28, 2016, the forfeiture restrictions lapsed on May 24, 2016, which was the date of the annual meeting of stockholders after the 72nd birthday of each of Messrs. Jungels, Lash and Stewart. Messrs. Brady and Nichols and Ms. Gargalli were 73 at the time of grant and their forfeiture restrictions lapsed immediately. |

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|                                               |
|-----------------------------------------------|
|                                               |  |  |  |  |
| Committee Memberships as of December 31, 2016 |
| Audit/Ethics                                  | Compensation | Executive | Finance | Governance & HS&E |
| James A. Lash (C)                             | Anthony G. Fernandes (C) | Martin S. Craighead (C) | Lynn L. Elsenhans (C) | J. Larry Nichols (C) |
| Larry D. Brady (1)                            | Clarence P. Cazalot, Jr. | Clarence P. Cazalot, Jr. | William H. Easter III | Lynn Elsenhans |
| Gregory D. Brenneman                          | William H. Easter III | J. Larry Nichols | Pierre H. Jungels | Anthony G. Fernandes |
| J. Larry Nichols                              | Claire W. Gargalli | James W. Stewart | James W. Stewart | James A. Lash |
|                                          | Pierre H. Jungels | Charles L. Watson | Charles L. Watson |   |
| (C)  Chair of the referenced Committee.       |

|     |
|-----|
|     |  |
| (1) | On January 15, 2017, Mr. Larry D. Brady passed away after serving for thirteen years on the Board. At this time, we do not anticipate filling Mr. Brady's vacancy on the Audit/Ethics Committee. |

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----

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|                                                                                                                                                                                                                                                   |
|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
|                                                                                                                                                                                                                                                   |  |  |
| Name and Address                                                                                                                                                                                                                                  | Shares | Percent of Class |
| FMR LLC (1) 245 Summer StreetBoston, MA 02210                                                                                                                                                                                                | 34,344,008 | 8.1% |
| BlackRock Inc. (2)55 East 52nd StreetNew York, NY 10055                                                                                                                                                                                           | 32,746,185 | 7.7% |
| ValueAct Capital (3)                         One Letterman Drive, Building D, Fourth Floor   San Francisco, CA 94129 | 29,886,200 | 7.0% |
| The Vanguard Group (4)100 Vanguard Blvd.Malvern, PA 19355                                                                                                                                                                                         | 28,084,478 | 6.6% |
| Dodge & Cox (5) 555 California Street, 40th FloorSan Francisco, CA 94104                                                                                                                                                                 | 25,677,863 | 6.1% |
| State Street Corporation (6)One Lincoln Street Boston, MA 02111                                                                                                                                                                                   | 22,332,987 | 5.3% |
| Capital World Investors (7)333 South Hope StreetLos Angeles, CA 90071                                                                                                                                                                             | 21,251,155 | 5.0% |

|     |                                                                                                        |
|-----|--------------------------------------------------------------------------------------------------------|
| (1) | FMR LLC has sole voting power over 1,973,265 shares and sole dispositive power over 34,344,008 shares. |

|     |                                                                                                                |
|-----|----------------------------------------------------------------------------------------------------------------|
| (2) | BlackRock Inc. has sole voting power over 27,816,941 shares and sole dispositive power over 32,746,182 shares. |

|     |                                                                                                                      |
|-----|----------------------------------------------------------------------------------------------------------------------|
| (3) | ValueAct Capital shares voting and dispositive power over 29,886,200 shares with other affiliated ValueAct entities. |

|     |                                                                                                                 |
|-----|-----------------------------------------------------------------------------------------------------------------|
| (4) | The Vanguard Group has sole voting power over 667,314 shares and sole dispositive power over 27,337,089 shares. |

|     |                                                                                                                 |
|-----|-----------------------------------------------------------------------------------------------------------------|
| (5) | Dodge & Cox has sole voting power over 24,153,247 shares and sole dispositive power over 25,677,863 shares. |

|     |                                                                                                        |
|-----|--------------------------------------------------------------------------------------------------------|
| (6) | State Street Corporation has sole voting power over 0 shares and sole dispositive power over 0 shares. |

|     |                                                                                                                         |
|-----|-------------------------------------------------------------------------------------------------------------------------|
| (7) | Capital World Investors has sole voting power over 21,251,155 shares and sole dispositive power over 21,251,155 shares. |

----

|                                                              |
|--------------------------------------------------------------|
|                                                              |  |  |  |  |  |  |  |  |
| Shares Beneficially Owned                                    |
| Name                                                         | Shares Owned as of March 3, 2017 | Shares Subject to Options and Restricted Stock Units Which Are or Will Become  Exercisable or Vested Prior to May 2, 2017 | Total Beneficial Ownership as of March 3, 2017 | % of Class (1) |
| Gregory D. Brenneman                                         | 93,711 |  | — |  | 93,711 |  | — |  |
| Clarence P. Cazalot, Jr.                                     | 36,447 |  | 10,260 |  | 46,707 |  | — |  |
| William H. Easter III                                        | 9,711 |  | — |  | 9,711 |  | — |  |
| Lynn L. Elsenhans                                            | 15,238 |  | 19,768 |  | 35,006 |  | — |  |
| Anthony G. Fernandes                                         | 49,190 |  | 10,260 |  | 59,450 |  | — |  |
| Claire W. Gargalli                                           | 29,016 |  | 10,260 |  | 39,276 |  | — |  |
| Pierre H. Jungels                                            | 24,080 |  | 10,260 |  | 34,340 |  | — |  |
| James A. Lash                                                | 12,757 |  | 6,589 |  | 19,346 |  | — |  |
| J. Larry Nichols                                             | 39,813 |  | 10,260 |  | 50,073 |  | — |  |
| James W. Stewart (2)                                         | 259,235 |  | 7,856 |  | 267,091 |  | — |  |
| Charles L. Watson                                            | 35,647 |  | 10,260 |  | 45,907 |  | — |  |
| Martin S. Craighead                                          | 279,860 |  | 597,209 |  | 877,069 |  | — |  |
| Kimberly A. Ross                                             | 83,917 |  | — |  | 83,917 |  | — |  |
| Belgacem Chariag                                             | 101,653 |  | 167,970 |  | 269,623 |  | — |  |
| Arthur L. Soucy                                              | 43,680 |  | 145,707 |  | 189,387 |  | — |  |
| Derek Mathieson                                              | 47,015 |  | 80,048 |  | 127,063 |  | — |  |
| Alan R. Crain                                                | 101,586 |  | 254,754 |  | 356,340 |  | — |  |
| All directors and executive officers as a group (23 persons) | 1,345,717 |  | 1,493,887 |  | 2,839,604 |  | — |  |

|     |                                                            |
|-----|------------------------------------------------------------|
| (1) | No percent of class is shown for holdings of less than 1%. |

|     |                                                                                                                                                                                                                                                                                                                                                                       |
|-----|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| (2) | Mr. Stewart holds 16,416 shares indirectly as the trustee of trusts established for the benefit of his children and 54,368 shares indirectly held by B&A Group, LP for the benefit of his children. Mr. Stewart disclaims his beneficial ownership of limited partnership interests in B&A Group, LP, except to the extent of his pecuniary interest therein. |

----

----

----

|         |                                                                                                                                                                      |
|---------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| • | Simplified our organizational structure and operational footprint and reduced our annualized costs by nearly $700 million, exceeding our initial goal by almost 40%; |

|         |                                                                |
|---------|----------------------------------------------------------------|
| • | Accelerated innovation with nearly 70 new product innovations; |

|         |                                                                                                    |
|---------|----------------------------------------------------------------------------------------------------|
| • | Paid down $1 billion of debt and repurchased more than $750 million in shares of our Common Stock; |

|         |                                                                                             |
|---------|---------------------------------------------------------------------------------------------|
| • | Built new sales channels and rationalized under-performing product lines in select markets; |

|         |                                                                                                                                                                    |
|---------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| • | On a GAAP basis, net loss attributable to the Company was $1,892 million for the first half of 2016 compared to a loss of $846 million in the second half of 2016; |

|         |                                                                                                                                                                                          |
|---------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| • | Adjusted operating profit (a non-GAAP measure) for the second half of 2016 was $28 million compared to an adjusted operating loss of nearly $700 million for the first half of 2016; and |

----

|         |                                                                                                                                                                                                                     |
|---------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| • | Achieved 208 Perfect Health Safety and Environment ("HSE") days (no recordable injuries, no vehicle accidents, and no harm to the environment) for all of 2016 in spite of extremely difficult business conditions. |

|         |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      |
|---------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| • | Due to constraints on implementing significant changes to the business pending completion of the Halliburton Merger, we structured the Annual Incentive Compensation Plan for Employees (AICPE) to reward performance in excess of financial targets, with a guarantee of a target level bonus for all bonus-eligible employees for the first six months of 2016 (approximately 20,000 employees, including Senior Executives) who remained with the Company through the payment date of March 2017.  Had the Halliburton Merger been consummated during 2016, a pro-rated target level bonus would have been paid to all participants under our annual bonus plans; |

|         |                                                                                                                                                                                                                |
|---------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| • | Delivered all long-term incentives in the form of restricted stock units for all employees who received annual equity awards in January 2016 (approximately 2,000 employees, including Senior Executives); and |

|         |                                                                                                                                                                                                                                              |
|---------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| • | Suspended the annual salary merit increase cycle globally (including Senior Executives) and limited promotions and off-cycle salary increases for the second consecutive year, consistent with practices of other companies in our industry. |

|         |                                                                                                                                                                                              |
|---------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| • | Reinstated a 100% performance-based bonus structure based upon key financial metrics and strategic performance metrics that reinforce a return to profitability for the second half of 2016; |

|         |                                                                                             |
|---------|---------------------------------------------------------------------------------------------|
| • | Approved 2017 long-term incentive program design returning to performance-based awards; and |

|         |                                                                                                 |
|---------|-------------------------------------------------------------------------------------------------|
| • | Initiated a temporary salary reduction for many US employees, including most Senior Executives. |

|         |                                                                                                                                                 |
|---------|-------------------------------------------------------------------------------------------------------------------------------------------------|
| • | Continuing a 100% performance-based short-term incentive bonus structure for 2017 based on key financial and strategic performance metrics; and |

|         |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     |
|---------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| • | Increasing performance-based awards for Senior Executives to 50% of the total long-term incentives granted during the annual January 2017 grant cycle in the form of restricted stock units. The payout is based upon relative growth and return metrics versus the Company's peer group during performance periods within 2017 - 2019. Any actual payout would be delivered at the end of the performance period ending in 2019. The remaining 50% of the January 2017 grant was delivered in the form of service based restricted stock units that will vest one-third each year. |

----

|        |
|--------|
|        |  |  |  |  |  |
|   | Martin S. Craighead - Chairman & Chief Executive Officer (PEO) |   |
|   | Kimberly A. Ross - Senior Vice President and Chief Financial Officer (PFO) |   |
|   | Belgacem Chariag - President, Global Operations |   |   |
|   | Arthur L. Soucy - President, Products and Technology |   |   |
|   | Derek Mathieson - Chief Commercial Officer |   |   |
|   | Alan R. Crain - Senior Vice President, Chief Legal and Governance Officer (retired on December 29, 2016) |

----

|                                                                                                                                                                                                                                                         |
|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
|                                                                                                                                                                                                                                                         |  |
| Objectives                                                                                                                                                                                                                                              | How We Meet Our Objectives |
| Attract and retain knowledgeable,  experienced, and high performing Senior Executives                                                                                                                                                                   | Provide a competitive total pay package, taking into account base salary, incentives and benefits. |
| Regularly benchmark our pay programs against the competitive market, comparing both fixed and variable, at-risk compensation that is tied to short and long-term performance. We use the results of this analysis as context in making pay adjustments. |
| Administer plans to include three-year performance cycles on long-term incentive plan awards, three-year vesting schedules on equity incentives, and competitive total benefit programs, including retirement benefits.                                 |
|                                                                                                                                                                                                                                                    | Historically, the long-term incentive plan has consisted of a combination of stock options, restricted stock awards, and cash-based and stock-based performance units. For 2016, the Compensation Committee did not grant new stock options or performance units.  For 2017, equity awards included performance-based restricted stock units as well as service-based restricted stock units. |
| Reward the creation of long-term stockholder value                                                                                                                                                                                                      | The incentive programs include specific financial performance measures that are fundamental to long-term stockholder value creation:The AICPE uses earnings per share, inventory as a percentage of revenue, and days sales outstanding, and adjusted operating profit targets set by the Compensation Committee.The long-term incentive plan performance-based restricted stock units use revenue growth and return on capital employed performance metrics as compared to our peer group, as well as for certain grants prior to 2017, a relative TSR modifier compared to TSR's of the companies included in the OSX Index. |

----

|                                                                                                                                                                                                                                                                                                                                                                |
|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
|                                                                                                                                                                                                                                                                                                                                                                |  |
| Objectives                                                                                                                                                                                                                                                                                                                                                     | How We Meet Our Objectives |
| Address the complexities in managing a cyclical business that is subject to variable world supply and demand for oil and gas                                                                                                                                                                                                                                   | The short-term incentive programs provide for formulaic and non- formulaic short-term performance goals and rewards managers for the achievement of those goals. |
| The long-term incentive plan utilizes a combination of share growth and full-value awards, balancing retention and appreciation through the business cycles. For 2016, full-value awards were utilized for the long-term incentive plan.  For 2017, performance based and service based restricted stock units were utilized for the long-term incentive plan. |
| The performance-based restricted stock unit component of the long-term incentive plan measures Company performance relative to industry peers, mitigating the difficulty in goal setting over long periods.                                                                                                                                                    |
| Drive and reward performance that supports the Company's core values of integrity, teamwork, performance, learning and courage                                                                                                                                                                                                                                 | Success in the promotion of core values is considered in the base salary review process and when determining annual award values for long-term incentive compensation awards. |
| The short-term incentive programs allow for the reduction or elimination of bonus payouts if the Company's core values or compliance standards are not upheld.                                                                                                                                                                                                 |
| Provide a significant percentage of total compensation that is variable and at risk                                                                                                                                                                                                                                                                            | Annual and long-term incentive compensation comprises, on average, more than two-thirds of our Senior Executives' total direct compensation. |
| Reinforce adherence to high ethical, environmental, health and safety standards                                                                                                                                                                                                                                                                                | The performance scorecard bonus component may include specific business goal targets related to HSE. |
| The short-term incentive programs allow for reduction or elimination of bonus payouts if the HSE standards are not upheld.                                                                                                                                                                                                                                     |
| Motivate management to take prudent, but not excessive, risks                                                                                                                                                                                                                                                                                                  | Pay programs emphasize long-term incentive compensation with overlapping year-over-year performance-based vesting schedules. |
| Our share ownership guidelines encourage Executives to focus on the long-term interests of our stockholders.                                                                                                                                                                                                                                                   |
| We typically utilize multiple performance measures for short-term and long-term incentives, as well as peer comparisons.                                                                                                                                                                                                                                       |
| The Company's clawback policy allows for the potential recoupment of short-term and long-term incentive compensation in the event of a financial restatement resulting from gross negligence, intentional misconduct or fraud.                                                                                                                                 |
| Align executive and stockholder interests                                                                                                                                                                                                                                                                                                                      | Our share ownership guidelines motivate alignment between long-term stockholder value creation and management decisions. |
| The ultimate value of our annual equity grants is driven by stock price performance.                                                                                                                                                                                                                                                                           |

----

|         |                                                                                                                     |
|---------|---------------------------------------------------------------------------------------------------------------------|
| • | Assists in the annual review and approval of the comparator groups used to benchmark executive compensation levels; |

|         |                                                                                          |
|---------|------------------------------------------------------------------------------------------|
| • | Provides comparative market data on compensation practices and programs; and advises in: |

|         |                                                 |
|---------|-------------------------------------------------|
| ◦ | Determining base salaries for Senior Executives |

|         |                                                                                                                                |
|---------|--------------------------------------------------------------------------------------------------------------------------------|
| ◦ | Setting individual performance goals and award levels for Senior Executives for the long-term incentive plan performance cycle |

|         |                                                                             |
|---------|-----------------------------------------------------------------------------|
| ◦ | Reviewing compensation trends and regulatory matters affecting compensation |

|         |                                                                                                   |
|---------|---------------------------------------------------------------------------------------------------|
| ◦ | Designing and determining individual grant levels for Senior Executive long-term incentive awards |

----

|              |
|--------------|
|              |  |  |  |  |
|         |   | Reference Group |
|         |   | 20 companies - oilfield services, exploration & production, offshore drilling, oil and gas, and general industry: |
|         |   | Ÿ 3M Company | Ÿ Emerson Electric Co | Ÿ Raytheon Co |
|         |   | Ÿ Anadarko Petroleum Co | Ÿ Halliburton Co | Ÿ Schlumberger Ltd |
| Compensation | ð | Ÿ Apache Corp | Ÿ Hess Corp | Ÿ Textron Inc |
|         |   | Ÿ Danaher Corp | Ÿ Honeywell Intl Inc | Ÿ Transocean Ltd |
|         |   | Ÿ Deere & Co | Ÿ Illinois Tool Works | Ÿ Weatherford Intl Ltd |
|         |   | Ÿ Devon Energy Corp | Ÿ Johnson Controls Inc | Ÿ Williams Cos Inc |
|         |   | Ÿ Eaton Corp | Ÿ National Oilwell Varco |   |
|         |   | Used to identify and compare executive pay practices such as pay mix and magnitude, competitiveness, prevalence of long-term incentive vehicles, pay-for-performance plans, etc. |
|         |   |   |
|         |   | Peer Group |
|         |   | 4 companies - oilfield services only |
|         |   | Ÿ Halliburton Co | Ÿ Schlumberger Ltd |   |
| Performance  | ð | Ÿ National Oilwell Varco | Ÿ Weatherford Intl Ltd |   |
|         |   | Used to compare performance in order to determine long-term incentive plan results and for general performance assessment. |

|                         |
|-------------------------|
|                         |  |  |
| ¨ Base Salary | ¨ Short-Term Incentives | ¨ Long-Term Incentives |

----

|         |                                      |
|---------|--------------------------------------|
| • | Financial performance of the Company |

|         |                                                                        |
|---------|------------------------------------------------------------------------|
| • | Effective execution of the strategy approved by our Board of Directors |

|         |                                          |
|---------|------------------------------------------|
| • | Development of human resource capability |

|                     |
|---------------------|
|                     |  |  |  |  |  |
| Senior Executives   | 2015  Salary | % Increase Awarded in 2016 | 2016    Salary (1) | New Salary Effective Date |
| Martin S. Craighead | $1,250,000 | - |  | $1,250,000 | - |
| Kimberly A. Ross    | $800,000 | - |  | $800,000 | - |
| Belgacem Chariag    | $700,000 | 7.1 | % | $750,000 | May 22, 2016 |
| Arthur L. Soucy     | $605,000 | 7.4 | % | $650,000 | May 22, 2016 |
| Derek Mathieson     | $640,000 | - |  | $640,000 | - |
| Alan R. Crain       | $750,000 | - |  | $750,000 | - |

----

|                     |
|---------------------|
|                     |  |  |  |  |  |  |  |  |  |
| Senior Executives   | AICPE | + | Performance Scorecard | = | STI Target % of Base Salary | 2016 Modifications |
| Martin S. Craighead | 72 | % |   | 48 | % |   | 120 | % | - |
| Kimberly A. Ross    | 60 | % |   | 40 | % |   | 100 | % | - |
| Belgacem Chariag    | 60 | % |   | 40 | % |   | 100 | % | Increased from 80% effective July 1, 2016 |
| Arthur L. Soucy     | 45 | % |   | 30 | % |   | 75 | % | Increased from 60% effective July 1, 2016 |
| Derek Mathieson     | 48 | % |   | 32 | % |   | 80 | % | - |
| Alan R. Crain       | 48 | % |   | 32 | % |   | 80 | % | - |

|        |
|--------|
|        |  |  |  |
|   | AICPE | H1 2016 | H2 2016 |
|   | Metrics | - Adjusted earnings per share | - Adjusted operating profit |
|   | - Inventory as % of revenue | - Relative adjusted operating profit margin improvement v. peers |
|   | - Days sales outstanding |
|   | Actual Achievement | Did not achieve target level goals (which would have resulted in a payout of 52.5% of target but for the guarantee of a minimum of target level payout for H1 2016) | Exceeded performance goals, resulting in a payout of 105.8% of target |
|   |
|   |
|   | Payout | Due to the guarantee to pay a minimum target level bonus, all participants, including Senior Executives, will receive a target level payout (100% of target) for H1 | Payout based on performance (no guarantee to pay minimum target level bonus). Senior Executives will receive a payout of 105.8% of target and all other plan participants will receive a payout of 130.2% of target. (Senior Executives were held to higher level of achievement than other plan participants in order to receive a target level payout) |
|   |
|   |
|   | Total AICPE Payout | 102.9% |

----

|                                                                       |
|-----------------------------------------------------------------------|
|                                                                       |  |
| Performance Scorecard                                                 | 2016 Annual Period |
| Metrics                                                               | Safety |
| Halliburton Merger Integration (H1 Only)                              |
| Operations and Compliance                                             |
| Technology and Innovation                                             |
| Leadership                                                            |
| Cost Reduction (H2 Only)                                              |
| Maintain focus on retention and engagement of BHI employees worldwide |
| Total Performance Scorecard Payout                                    | The Compensation Committee approved the funding of a bonus pool at 215% of target |

|                                                |
|------------------------------------------------|
|                                                |  |
| Overall 2016 Short-Term Incentive (STI) Payout | AICPE at 102.9% (60% of STI) and Performance Scorecard at 215% (40% of STI) = 147.7% |

----

|                   |
|-------------------|
|                   |  |  |  |  |  |
| Performance Level | Definition | Payout Level% of Target | 2016                                                                                                                                                                                                                                                                                                                                                                                                                                                                     Earnings Per Share      Target | 2016 Inventory % of Revenue | 2016 Days Sales Outstanding |
| Expected Value    | Performance meets expected value | 100% Payout | $(0.24) | 21.0% | 85.2 days |
| Over Achievement  | Performance exceeds expected value | 200% Payout | $(0.07) | 19.0% | 81.0 days |

|                            |
|----------------------------|
|                            |  |  |  |  |  |  |  |  |
|                       | H2 2016 Adjusted Operating Profit Margin Improvement Rank |
| H2 Operating Profit (Loss) | 1st | 2nd | 3rd | 4th |
| $200 million               | 200 | % | 150 | % | 100 | % | 50 | % |
| $ - (Breakeven)            | 100 | % | 50 | % | 25 | % | - |  |
| $(70 million)              | 50 | % | 25 | % | - |  | - |  |
| Below $(70 million)        | - |  | - |  | - |  | - |  |

----

|                                                                 |
|-----------------------------------------------------------------|
|                                                                 |  |  |
| Performance Component                                           | Beginning of Year Performance Expectation | Assessment of Performance for 2016 |
| HSE Enterprise goals                                            | Improve HSE Metrics--Preventable Vehicle Accident Rate, Total Recordable Incident Rate and Days Away From Work Case Rate--by 10% from 2015 Actuals | Achieved best record in Company history for second consecutive year in spite of extremely difficult business conditions.  However, an employee fatality occurred, overshadowing an otherwise successful record. |
| Cost (added for H2 2016)                                        | Reduce $500M of annualized costs by end of 2016 | Exceeded the cost reduction goal by reducing annualized costs over $700M |
| Continue Full Support of Halliburton Acquisition (H1 2016 only) | Effective integration and divestiture planning for Halliburton Merger | Provided full support to the Halliburton Merger until the termination of the Halliburton Merger Agreement on April 30, 2016. Received the $3.5 billion merger termination fee within 3 business days of termination. |

----

|                           |
|---------------------------|
|                           |  |  |
| Performance Component     | Beginning of Year Performance Expectation | Assessment of Performance for 2016 |
| Operations and Compliance | Continue building a culture of flawless execution and operational excellenceMaintain legal and financial compliance | Fully achieved |
| Technology and Innovation | Targeted development, deployment and commercialization of strategic products | Achieved goals, including the introduction of nearly 70 new products and services in the second half of 2016 |
| Leadership                | Continue to strengthen leadership and organizational capabilities- Sales effectiveness     - ELT effectivenessEffectively communicate business and integration updates to extended teamsMaintain focus on retention and engagement of BHI employees worldwideImplement organizational changes required by new strategy (added for H2 2016) | Fully achieved goals including establishing a new executive leadership team within two days of the termination of the Halliburton Merger Agreement. The remaining organizational changes were implemented within 30 days of the termination of the Halliburton Merger Agreement. |

----

|                     |
|---------------------|
|                     |  |  |
| Senior Executives   | Target Grant Value of 2016 Long-Term Incentive Annual Award | Target Grant Value of SpecialLong-Term Incentive Award |
| Martin S. Craighead | $9,570,000 | - |
| Kimberly A. Ross    | $3,579,400 | - |
| Belgacem Chariag    | $2,978,800 | $2,000,000 |
| Arthur L. Soucy     | $2,234,100 | $2,000,000 |
| Derek Mathieson     | $2,387,000 | - |
| Alan R. Crain       |     $3,172,400 (1) | - |

|     |
|-----|
|     |  |
| (1) | Pursuant to Mr. Crain's Letter Agreement, the restricted stock unit award granted on January 27, 2016 valued at $3,172,400 vested in full upon his retirement date. |

|                                                                                                                                                                     |
|---------------------------------------------------------------------------------------------------------------------------------------------------------------------|
|                                                                                                                                                                     |  |  |  |  |
| Performance Period                                                                                                                                                  | Metrics | Peer Group | Determination of Unit Award Value | Payout Type |
| 2014-2016                                                                                                                                                           | Ÿ Revenue GrowthŸ Absolute ROCEŸ Change in ROCE | Ÿ HalliburtonŸ NOVŸ SchlumbergerŸ Weatherford | The number of performance units to vest is preliminarily determined by the Company's rank for each metric for each one-year period and over the three-year performance period compared to the peer group. | Settled in stock at the end of the performance period |
| Ÿ   Total Shareholder                                              Return (TSR)      Modifier | Ÿ    OSX | The final number of vested units is modified upward or downward based on the Company's TSR at the end of the three-year performance period relative to the companies in the Philadelphia Stock Exchange Oil Service Sector Index (or OSX). |

----

|                                                                                                                                                                                                                                  |
|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
|                                                                                                                                                                                                                                  |  |  |  |  |  |  |
| Contingent number of share-based units granted at beginning of term                                                                                                                                                              | End of Year 1• 25% of total  unit modifier   determined• BHI compared  to peer group |   | End of Year 2• 25% of total  unit modifier  determined• BHI compared  to peer group |   | End of Year 3• 25% of total  unit modifier   determined• BHI compared  to peer group | Preliminary unit modifier calculated at end of term |
| End of Year 3                  • 25% of total unit modifier determined    • BHI compared to peer group |

|                                    |
|------------------------------------|
|                                    |  |  |  |  |  |
| Revenue Growth (50% of Unit Value) |
| Peer Group Rank                    | 5th | 4th | 3rd | 2nd | 1st |
| Unit Value                         | —% | 45% | 90% | 135% | 200% |

|                     |
|---------------------|
|                     |  |  |  |  |  |  |
|                | ROCE |
|                | (50% of Unit Value) |
|                | Goal Payout Matrix: |
| R OCE         % Chg | 1st | 130% | 150% | 165% | 180% | 200% |
| 2nd                 | 100% | 115% | 125% | 135% | 165% |
| 3rd                 | 65% | 80% | 90% | 115% | 135% |
| 4th                 | 30% | 45% | 50% | 80% | 90% |
| 5th                 | —% | 20% | 35% | 50% | 70% |
|                |   | 5th | 4th | 3rd | 2nd | 1st |
|                | ROCE |

|                                                      |
|------------------------------------------------------|
|                                                      |  |  |
| TSR Modifier (Performance Measured over Three-Years) |
| TSR Percentile Rank                                  | Payout Multiple |
| Less than 25th Percentile                            | (30 | )% |
| 25th Percentile                                      | (15 | )% |
| 50th Percentile                                      | - |  |
| 75th Percentile or Greater                           | 30 |  % |

----

|                      |
|----------------------|
|                      |  |  |  |  |  |  |  |  |  |  |
|                 | Relative Performance Rank |   | Preliminary Unit Values |
| Period               | Rev. Growth Rank | ROCE Rank (Absolute) | ROCE Rank (Improvement) |   | Rev. Growth Payout % | ROCE Payout % | Average |
| 2014                 | 2nd | 4th | 2nd |   | 135.0 | % | 115.0 | % | 125.0 | % |
| 2015                 | 3rd | 4th | 4th |   | 90.0 | % | 45.0 | % | 67.5 | % |
| 2016                 | 3rd | 4th | 5th |   | 90.0 | % | 20.0 | % | 55.0 | % |
| 3-Year (2014 - 2016) | 3rd | 4th | 4th |   | 90.0 | % | 45.0 | % | 67.5 | % |
|                 |   |   | Preliminary Unit Modifier (4-period avg. ) |   | 78.75 | % |

|                                |
|--------------------------------|
|                                |  |  |  |  |  |  |
| Company                        | TSR |   | Company | TSR |
| Baker Hughes Incorporated      | 25.88 |  % |   | National  Oilwell Varco, Inc | (40.87 | )% |
| Halliburton Company            | 12.64 |  % |   | Rowan Companies plc | (41.12 | )% |
| Helmerich & Payne, Inc.    | 9.63 |  % |   | Oceaneering International, Inc. | (59.88 | )% |
| Nabors Industries Ltd.         | 6.87 |  % |   | Diamond Offshore Drilling, Inc. | (63.16 | )% |
| Schlumberger Limited           | 3.15 |  % |   | Transocean Ltd. | (65.18 | )% |
| Golar LNG Limited              | (25.46 | )% |   | Weatherford International plc | (65.38 | )% |
| Oil States International, Inc. | (33.49 | )% |   | Bristow Group Inc. | (72.01 | )% |
| Core Laboratories N.V.         | (33.95 | )% |   | Tidewater Inc. | (93.04 | )% |

|                     |
|---------------------|
|                     |  |  |  |  |  |  |
| Senior Executives   | Target number of 2014 - 2016 Performance Units | Performance Payout | Final Shares Vested |
| Martin S. Craighead | 46,007 |  | 102.375 | % | 47,099 |  |
| Kimberly A. Ross    | 36,000 |  | 102.375 | % | 36,855 |  |
| Belgacem Chariag    | 12,400 |  | 102.375 | % | 12,694 |  |
| Arthur L. Soucy     | 9,201 |  | 102.375 | % | 9,419 |  |
| Derek Mathieson     | 11,475 |  | 102.375 | % | 11,747 |  |
| Alan R. Crain       | 15,251 |  | 102.375 | % | 15,613 |  |

----

----

----

|                                                                |
|----------------------------------------------------------------|
|                                                                |  |
| Chairman, President and Chief Executive Officer                | 6X Base Salary |
| Senior Vice President reporting to Chief Executive Officer     | 3X Base Salary |
| Corporate Vice Presidents reporting to Chief Executive Officer | 2X Base Salary |

----

|                                                         |
|---------------------------------------------------------|
|                                                         |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
| Name andPrincipal Position                              | Year | Salary($) | Bonus (1)($) | Stock Awards (2)($) | OptionAwards (3)($) | Non-EquityIncentive Plan Compensation (4) ($) | Change in Pension Value and Nonqualified Deferred Compensation Earnings (5)($) | All Other Compensation($) |   | Total($) |
| Martin S. Craighead - Principal Executive Officer       | 2016 | 1,233,173 |  | — |  | 9,569,977 |  | — |  | 2,185,916 |  | 42,293 |  | 429,923 |  | (6)  | 13,461,282 |  |
| 2015                                                    | 1,250,000 |  | — |  | 9,569,978 |  | — |  | 2,144,063 |  | 15,279 |  | 552,415 |  |   | 13,531,734 |  |
| 2014                                                    | 1,236,538 |  | — |  | 6,673,788 |  | 2,658,109 |  | 3,932,503 |  | 33,345 |  | 447,422 |  |   | 14,981,705 |  |
|                                                    |   |   |   |   |   |   |   |   |   |   |
| Kimberly A. Ross - Principal Financial Officer          | 2016 | 800,000 |  | — |  | 3,579,393 |  | — |  | 1,181,920 |  | 9,997 |  | 235,535 |  | (7)  | 5,806,845 |  |
| 2015                                                    | 800,000 |  | — |  | 3,579,380 |  | — |  | 832,000 |  | 8,439 |  | 150,856 |  |   | 5,370,674 |  |
| 2014                                                    | 132,308 |  | 600,000 |  | 3,567,720 |  | — |  | 281,357 |  | 3,992 |  | 13,925 |  |   | 4,599,302 |  |
|                                                    |   |   |   |   |   |   |   |   |   |   |
| Belgacem Chariag - President, Global Operations         | 2016 | 718,750 |  | — |  | 4,978,724 |  | — |  | 958,751 |  | 24,302 |  | 215,347 |  | (8)  | 6,895,874 |  |
| 2015                                                    | 700,000 |  | — |  | 2,978,780 |  | — |  | 784,394 |  | 10,083 |  | 266,524 |  |   | 4,739,781 |  |
| 2014                                                    | 691,923 |  | — |  | 2,162,267 |  | 716,457 |  | 1,381,956 |  | 12,100 |  | 219,235 |  |   | 5,183,938 |  |
|                                                    |   |   |   |   |   |   |   |   |   |   |
| Arthur L. Soucy - President, Products and Technology    | 2016 | 622,211 |  | — |  | 4,234,043 |  | — |  | 622,570 |  | 56,698 |  | 295,816 |  | (9)  | 5,831,338 |  |
| 2015                                                    | 605,000 |  | — |  | 2,234,113 |  | — |  | 809,689 |  | 11,932 |  | 475,730 |  |   | 4,136,464 |  |
| 2014                                                    | 598,269 |  | — |  | 1,625,532 |  | 531,605 |  | 934,377 |  | 11,531 |  | 221,294 |  |   | 3,922,608 |  |
|                                                    |   |   |   |   |   |   |   |   |   |   |
| Derek Mathieson - Chief Commercial Officer              | 2016 | 636,308 |  | — |  | 2,386,968 |  | — |  | 752,013 |  | 9,785 |  | 156,275 |  | (10)  | 3,941,349 |  |
| 2015                                                    | 640,000 |  | — |  | 2,240,011 |  | — |  | 699,819 |  | 8,443 |  | 184,277 |  |   | 3,772,550 |  |
| 2014                                                    | 634,615 |  | — |  | 1,664,528 |  | 662,989 |  | 1,199,488 |  | 8,266 |  | 166,661 |  |   | 4,336,547 |  |
|                                                    |   |   |   |   |   |   |   |   |   |   |
| Alan R. Crain - SVP, Chief Legal and Governance Officer | 2016 | 750,000 |  | 2,675,000 |  | 3,172,379 |  | — |  | 300,000 |  | 112,642 |  | 437,488 |  | (11)  | 7,447,509 |  |
| 2015                                                    | 750,000 |  | — |  | 3,000,023 |  | — |  | 907,500 |  | 17,289 |  | 257,305 |  |   | 4,932,117 |  |
| 2014                                                    | 742,192 |  | — |  | 2,212,321 |  | 881,134 |  | 1,437,163 |  | 53,230 |  | 232,906 |  |   | 5,558,946 |  |

|     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           |
|-----|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| (1) | The annual cash incentive paid to our NEOs is included in the column “Non-Equity Incentive Plan Compensation.”  The amount under the Bonus column for Ms. Ross for 2014 includes a sign-on bonus of $60,000 and a bonus of $540,000 relating to the forfeiture of a bonus upon termination from her prior employer. The amount under the Bonus column for Mr. Crain for 2016 includes a lump sum payment of $2,000,000 in recognition of Mr. Crain's substantial contribution throughout the Halliburton Merger process, $300,000 in lieu of payments under AICPE and the performance scorecard bonus program for the second half of 2016, and $375,000 in consideration of a two-year non-compete agreement. |

|     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     |
|-----|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| (2) | The amounts reported for 2016 reflect that the long-term incentive awards granted in 2016 were structured exclusively in the form of restricted stock unit awards. No stock options or performance unit awards were granted in 2016. The amount reflected in the "Stock Awards" column is the aggregate grant date fair value of $39.97 for the restricted stock unit awards granted to the NEOs on January 27, 2016, and $45.33 for the restricted stock unit awards granted to Messrs. Chariag and Soucy on May 23, 2016, and computed in accordance with FASB  ASC Topic 718. For a discussion of valuation assumptions, see “Note 7 - Stock-Based Compensation” of the Notes to Consolidated Financial Statements included in our Annual Report under Item 8 of the Form 10-K for the year ended December 31, 2016. |

|     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           |
|-----|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| (3) | The amount reflected in the "Option Awards" column is the aggregate grant date fair value of the awards made to NEOs, computed in accordance with FASB ASC Topic 718. The fair value of each grant is established on the date of grant using the Black-Scholes option-pricing model. The value ultimately realized by the executive upon the actual vesting of the exercise of the stock option(s) may or may not be equal to the FASB ASC Topic 718 determined value. For a discussion of valuation assumptions, see “Note 7 - Stock-Based Compensation” of the Notes to Consolidated Financial Statements included in our Annual Report under Item 8 of the Form 10-K for the year ended December 31, 2016. |

|     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 |
|-----|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| (4) | The amounts for the 2016 fiscal year include: (i) annual incentive plan bonuses earned under the AICPE for Mr. Craighead, Ms. Ross, and Messrs. Chariag, Soucy, Mathieson and Crain in the amounts of $913,282, $493,920, $401,487, $260,713, $314,234, and $180,000, respectively, (ii) cash-based awards based on performance scorecard goals for Mr. Craighead, Ms. Ross, and Messrs. Chariag, Soucy, Mathieson, and Crain in the amounts of $1,272,635, $688,000, $557,263, $361,857, $437,780, and $120,000, respectively. |

----

|     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             |
|-----|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| (5) | This amount reflects the change in the present values of the NEOs’ accumulated benefits under the Baker Hughes Incorporated Pension Plan as well as above-market earnings on SRP or International Retirement Plan ("IRP") accounts. Certain NEOs had above-market earnings on their SRP or IRP accounts. The above-market earnings were the actual earnings deemed credited to the SRP or IRP accounts minus 120% of the long-term AFR, compounded monthly (3.14%, 3.16%, and 4.11% for 2016, 2015, and 2014, respectively). Mr. Craighead’s above-market earnings on his SRP accounts were $26,819, $0, and $17,652 for 2016, 2015, and 2014, respectively. Ms. Ross’ above-market earnings on her SRP accounts were $0 and $0 for 2016 and 2015, respectively. Mr. Chariag's above-market earnings on his IRP and SRP accounts were $13,796, $0, and $2,862 for 2016, 2015, and 2014, respectively. Mr. Soucy's above-market earnings on his SRP accounts were $44,441, $0 and $132 for 2016, 2015, and 2014, respectively. Mr. Mathieson’s above-market earnings on his SRP accounts were $0 for 2016, 2015, and 2014, respectively. Mr. Crain’s above-market earnings on his SRP accounts were $95,117, $0, and $35,209 for 2016, 2015, and 2014, respectively. |

|     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                            |
|-----|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| (6) | Amount for 2016 includes (i) $321,053 that the Company contributed to Mr. Craighead's SRP account, (ii) $61,500 in dividends earned on unvested restricted stock, (iii) $6,870 in life and disability insurance premiums paid by the Company on behalf of Mr. Craighead, (iv) $25,175 in employer matching and employer base contributions that the Company contributed to the Thrift Plan on behalf of Mr. Craighead; and (v) $15,325 for financial counseling. |

|     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                 |
|-----|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| (7) | Amount for 2016 includes (i) $177,710 that the Company contributed to Ms. Ross’ SRP account, (ii) $23,689 in dividends earned on unvested restricted stock, (iii) $5,248 in life and disability insurance premiums paid by the Company on behalf of Ms. Ross; (iv) $23,850 in employer matching and employer base contributions that the Company contributed to the Thrift Plan on behalf of Ms. Ross; and (v) $5,038 for financial counseling. |

|     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                 |
|-----|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| (8) | Amount for 2016 includes (i) $134,699 that the Company contributed to Mr. Chariag's SRP account; (ii) $36,631 in dividends earned on unvested restricted stock; (iii) $4,842 in life and disability insurance premiums paid by the Company on behalf of Mr. Chariag; (iv) $23,850 in employer matching and employer base contributions that the Company contributed to the Thrift Plan on behalf of Mr. Chariag; and (v) $15,325 for financial counseling. |

|     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        |
|-----|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| (9) | Amount for 2016 includes (i) $92,953 that the Company contributed to Mr. Soucy's SRP account; (ii) $13,566 in dividends earned on unvested restricted stock; (iii) $4,457 in life and disability insurance premiums paid by the Company on behalf of Mr. Soucy; (iv) $23,850 in employer matching and employer base contributions that the Company contributed to the Thrift Plan on behalf of Mr. Soucy; (v) $15,325 for financial counseling; and, for the period Mr. Soucy worked on expatriate assignment, (vi) $141,969 for tax equalization payments related to taxable assignee benefits, $2,500 for relocation allowance, and $1,196 for personal expense reimbursements. |

|      |                                                                                                                                                                                                                                                                                                                                                                                                                                                                      |
|------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| (10) | Amount for 2016 includes (i) $105,997 that the Company contributed to Mr. Mathieson's SRP account; (ii) $14,757 in dividends earned on unvested restricted stock; (iii) $4,599 in life and disability insurance premiums paid by the Company on behalf of Mr. Mathieson; (iv) $22,525 in employer matching and employer base contributions that the Company contributed to the Thrift Plan on behalf of Mr. Mathieson; and (v) $8,397 for financial counseling. |

|      |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               |
|------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| (11) | Amount for 2016 includes (i) $362,260 that the Company contributed to Mr. Crain's SRP account; (ii) $19,704 in dividends earned on unvested restricted stock; (iii) $5,045 in life and disability insurance premiums paid by the Company on behalf of Mr. Crain; (iv) $26,500 in employer matching and employer base contributions that the Company contributed to the Thrift Plan on behalf of Mr. Crain; (v) $15,325 for financial counseling; and (vi) $8,654 for accrued but unused vacation as of Mr. Crain's retirement date. |

----

|                     |
|---------------------|
|                     |  |  |  |  |  |  |  |  |  |  |  |
|                |   | Estimated Future Payouts Under Non-Equity Incentive Plan Awards (1) | All Other Stock Awards:  Number of Shares of Stock or Units (2)(#) | Closing Market Price on Date of Grant($/Sh) | Grant Date Fair Value of Stock and Option Awards($) |
| Name                | Grant Date | Target($) | Maximum($) |
| Martin S. Craighead | 1/27/2016 |   |   | 239,429 |  | 39.97 |  | 9,569,977 |  |
| N/A                 | 1,479,808 |  | 3,255,577 |  |   |   |   |
| Kimberly A. Ross    | 1/27/2016 |   |   | 89,552 |  | 39.97 |  | 3,579,393 |  |
| N/A                 | 800,000 |  | 1,760,000 |  |   |   |   |
| Belgacem Chariag    | 1/27/2016 |   |   | 74,525 |  | 39.97 |  | 2,978,764 |  |
| 5/23/2016           |   |   | 44,120 |  | 45.33 |  | 1,999,960 |  |
| N/A                 | 647,981 |  | 1,425,558 |  |   |   |   |
| Arthur L. Soucy     | 1/27/2016 |   |   | 55,894 |  | 39.97 |  | 2,234,083 |  |
| 5/23/2016           |   |   | 44,120 |  | 45.33 |  | 1,999,960 |  |
| N/A                 | 420,764 |  | 925,682 |  |   |   |   |
| Derek Mathieson     | 1/27/2016 |   |   | 59,719 |  | 39.97 |  | 2,386,968 |  |
| N/A                 | 509,046 |  | 1,119,901 |  |   |   |   |
| Alan R. Crain       | 1/27/2016 |   |   | 79,369 |  | 39.97 |  | 3,172,379 |  |
| N/A                 | 300,000 |  | 660,000 |  |   |   |   |

|     |                                                                                                                                                                                                                                                                                                                                                |
|-----|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| (1) | Amounts represent potential payouts for the fiscal year 2016 performance year under the AICPE, as well as potential payouts for bonuses based on the performance scorecard. In February 2016, the Compensation Committee approved payouts at the target level as the minimum payout for the short-term incentive bonuses for fiscal year 2016. |

|     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           |
|-----|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| (2) | Amounts shown represent the number of restricted stock units granted under the 2002 D&O Plan in 2016. Awards generally vest pro-rata over a three-year period beginning on the first anniversary of the grant date. Dividends are accrued throughout the year on restricted stock units and paid out once the unit vests. The dividend rate is determined by the Board of Directors on a quarterly basis. Restricted stock unit awards granted to Messrs. Chariag and Soucy on May 23, 2016 vest in full on the second anniversary of the grant date. |

----

|                     |
|---------------------|
|                     |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
|                | Option Awards |   | Stock Awards |
| Name                | Number ofSecuritiesUnderlyingUnexercisedOptionsExercisable(#) | Number ofSecuritiesUnderlyingUnexercisedOptionsUnexercisable(#) | OptionExercisePrice (1)($) | OptionExpirationDate (2) |   | Number of Shares or Units of Stock that have Not Vested (3)(#) | Market Value of Shares of Units of Stock that Have Not Vested($) | Equity Incentive Plan Awards: Number of Unearned Shares, Units or Other Rights That Have Not Vested (4)(#) | Equity Incentive Plan Awards: Market or Payout Value  of Unearned Shares, Units or Other Rights That Have Not Vested($) |
| Martin S. Craighead | 46,178 |  | 23,089 |  | 72.70 |  | 7/14/2024 |  |   | 368,743 |  | 23,957,233 |  | 46,007 |  | 2,989,075 |  |
| 59,148              |  | 29,575 |  | 56.73 |  | 1/22/2024 |  |   |   |   |   |   |
|                | 89,066 |  | — |  | 47.75 |  | 7/24/2023 |  |   |   |   |   |   |
|                | 94,033 |  | — |  | 45.21 |  | 1/24/2023 |  |   |   |   |   |   |
|                | 88,980 |  | — |  | 39.30 |  | 7/16/2022 |  |   |   |   |   |   |
|                | 73,696 |  | — |  | 47.44 |  | 1/25/2022 |  |   |   |   |   |   |
|                | 22,300 |  | — |  | 77.00 |  | 7/19/2021 |  |   |   |   |   |   |
|                | 27,600 |  | — |  | 62.32 |  | 1/26/2021 |  |   |   |   |   |   |
|                | 27,500 |  | — |  | 49.17 |  | 7/21/2020 |  |   |   |   |   |   |
|                | 2,115 |  | — |  | 47.28 |  | 1/19/2020 |  |   |   |   |   |   |
|                | 3,427 |  | — |  | 29.18 |  | 1/21/2019 |  |   |   |   |   |   |
|                | 9,716 |  | — |  | 77.2 |  | 8/11/2018 |  |   |   |   |   |   |
|                | 10,674 |  | — |  | 69.92 |  | 1/23/2018 |  |   |   |   |   |   |
|                | 9,801 |  | — |  | 82.28 |  | 7/25/2017 |  |   |   |   |   |   |
|                | 3,400 |  | — |  | 67.16 |  | 3/30/2017 |  |   |   |   |   |   |
|                | 4,391 |  | — |  | 68.54 |  | 1/24/2017 |  |   |   |   |   |   |
|                |   |   |   |   |   |   |   |   |   |
| Kimberly A. Ross    | — |  | — |  | — |  | — |  |   | 88,539 |  | 5,752,379 |  | 36,000 |  | 2,338,920 |  |
|                |   |   |   |   |   |   |   |   |   |
| Belgacem Chariag    | 12,446 |  | 6,224 |  | 72.70 |  | 7/14/2024 |  |   | 163,150 |  | 10,599,856 |  | 12,400 |  | 805,628 |  |
| 15,942              |  | 7,972 |  | 56.73 |  | 1/22/2024 |  |   |   |   |   |   |
|                | 24,508 |  | — |  | 47.75 |  | 7/24/2023 |  |   |   |   |   |   |
|                | 25,875 |  | — |  | 45.21 |  | 1/24/2023 |  |   |   |   |   |   |
|                | 18,208 |  | — |  | 39.30 |  | 7/16/2022 |  |   |   |   |   |   |
|                | 22,619 |  | — |  | 47.44 |  | 1/25/2022 |  |   |   |   |   |   |
|                | 7,500 |  | — |  | 77.00 |  | 7/19/2021 |  |   |   |   |   |   |
|                | 9,300 |  | — |  | 62.32 |  | 1/26/2021 |  |   |   |   |   |   |
|                | 11,600 |  | — |  | 49.17 |  | 7/21/2020 |  |   |   |   |   |   |
|                | 12,000 |  | — |  | 47.28 |  | 1/19/2020 |  |   |   |   |   |   |
|                |   |   |   |   |   |   |   |   |   |
| Arthur S. Soucy     | 9,235 |  | 4,618 |  | 72.70 |  | 7/14/2024 |  |   | 133,605 |  | 8,680,316 |  | 9,201 |  | 597,789 |  |
| 11,829              |  | 5,915 |  | 56.73 |  | 1/22/2024 |  |   |   |   |   |   |
|                | 19,656 |  | — |  | 47.75 |  | 7/24/2023 |  |   |   |   |   |   |
|                | 20,752 |  | — |  | 45.21 |  | 1/24/2023 |  |   |   |   |   |   |
|                | 18,480 |  | — |  | 39.30 |  | 7/16/2022 |  |   |   |   |   |   |
|                | 15,306 |  | — |  | 47.44 |  | 1/25/2022 |  |   |   |   |   |   |
|                | 8,200 |  | — |  | 77.00 |  | 7/19/2021 |  |   |   |   |   |   |
|                | 10,100 |  | — |  | 62.32 |  | 1/26/2021 |  |   |   |   |   |   |
|                | 6,100 |  | — |  | 49.17 |  | 7/21/2020 |  |   |   |   |   |   |
|                | 7,200 |  | — |  | 47.28 |  | 1/19/2020 |  |   |   |   |   |   |

----

|                         |
|-------------------------|
|                         |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
|                    | Option Awards |   | Stock Awards |
| Name                    | Number ofSecuritiesUnderlyingUnexercisedOptionsExercisable(#) | Number ofSecuritiesUnderlyingUnexercisedOptionsUnexercisable(#) | OptionExercisePrice (1)($) | OptionExpirationDate (2) |   | Number of Shares or Units of Stock that have Not Vested (3)(#) | Market Value of Shares of Units of Stock that Have Not Vested($) | Equity Incentive Plan Awards: Number of Unearned Shares, Units or Other Rights That Have Not Vested (4)(#) | Equity Incentive Plan Awards: Market or Payout Value  of Unearned Shares, Units or Other Rights That Have Not Vested($) |
|                    | 12,934 |  | — |  | 28.55 |  | 4/1/2019 |  |   |   |   |   |   |
|                    |   |   |   |   |   |   |   |   |   |
| Derek Mathieson         | 11,518 |  | 5,759 |  | 72.70 |  | 7/14/2024 |  |   | 90,262 |  | 5,864,322 |  | 11,475 |  | 745,531 |  |
| 7,376                   |  | 7,377 |  | 56.73 |  | 1/22/2024 |  |   |   |   |   |   |
|                    | 15,192 |  | — |  | 47.75 |  | 7/24/2023 |  |   |   |   |   |   |
|                    | 8,020 |  | — |  | 45.21 |  | 1/24/2023 |  |   |   |   |   |   |
|                    | 8,465 |  | — |  | 39.30 |  | 7/16/2022 |  |   |   |   |   |   |
|                    | 9,900 |  | — |  | 77.00 |  | 7/19/2021 |  |   |   |   |   |   |
|                    | 12,200 |  | — |  | 62.32 |  | 1/26/2021 |  |   |   |   |   |   |
|                    |   |   |   |   |   |   |   |   |   |
| Alan R. Crain (5)  | 15,307 |  | 7,654 |  | 72.70 |  | 12/29/2021 |  |   | 5,931 |  | 385,337 |  | 15,251 |  | 990,857 |  |
|                    | 19,607 |  | 9,804 |  | 56.73 |  | 12/29/2021 |  |   |   |   |   |   |
|                    | 34,398 |  | — |  | 47.75 |  | 12/29/2021 |  |   |   |   |   |   |
|                    | 36,316 |  | — |  | 45.21 |  | 12/29/2021 |  |   |   |   |   |   |
|                    | 28,583 |  | — |  | 39.30 |  | 12/29/2021 |  |   |   |   |   |   |
|                    | 23,673 |  | — |  | 47.44 |  | 12/29/2021 |  |   |   |   |   |   |
|                    | 12,500 |  | — |  | 77.00 |  | 7/19/2021 |  |   |   |   |   |   |
|                    | 1,604 |  | — |  | 62.32 |  | 1/26/2021 |  |   |   |   |   |   |
|                    | 14,600 |  | — |  | 49.17 |  | 7/21/2020 |  |   |   |   |   |   |
|                    | 10,134 |  | — |  | 47.28 |  | 1/19/2020 |  |   |   |   |   |   |
|                    | 7,982 |  | — |  | 39.52 |  | 7/22/2019 |  |   |   |   |   |   |
|                    | 8,158 |  | — |  | 29.18 |  | 1/21/2019 |  |   |   |   |   |   |
|                    | 9,824 |  | — |  | 77.20 |  | 8/11/2018 |  |   |   |   |   |   |
|                    | 10,793 |  | — |  | 69.92 |  | 1/23/2018 |  |   |   |   |   |   |
|                    | 11,471 |  | — |  | 82.28 |  | 7/25/2017 |  |   |   |   |   |   |
|                    | 9,461 |  | — |  | 68.54 |  | 1/24/2017 |  |   |   |   |   |   |

|     |                                                                                                                                                                 |
|-----|-----------------------------------------------------------------------------------------------------------------------------------------------------------------|
| (1) | The exercise price is equal to the closing market price of a share of our Common Stock on the last trading day prior to the grant date.     |

|     |                                                                                                                                                                   |
|-----|-------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| (2) | Each option grant has a ten-year term. Each option generally vests pro rata as to one-third of the option grant beginning on the first anniversary of grant date. |

|     |                                                                                                                                                                                                      |
|-----|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| (3) | Each restricted stock award generally vests either pro rata as to one-third of the grant beginning on the first anniversary of grant date or cliff vests on the third anniversary of the grant date. |

|     |                                                                                                                                                                                                 |
|-----|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| (4) | The amount payable under each performance unit award settled in stock is delivered in shares of our Common Stock at the end of a three-year period beginning with the fiscal year of the grant. |

|     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                     |
|-----|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| (5) | Under the terms and conditions of option awards granted under the 2002 Director & Officer Plan, options expire at the earlier of the option expiration date or five years from the date of retirement. Pursuant to Mr. Crain's Letter Agreement, all of his unvested restricted stock unit awards vested as of December 29, 2016, with the exception of one unvested restricted stock unit award granted on January 22, 2014, which vested on January 22, 2017. |

----

|                                           |
|-------------------------------------------|
|                                           |  |  |  |  |  |  |  |  |
| Name                                      | Option Awards | Stock Awards |
| Number of Shares Acquired on Exercise (#) | Value Realized on Exercise (1) ($) | Number of Shares Acquired on Vesting (#) | Value Realized on Vesting (2)($) |
| Martin S. Craighead                       | — |  | — |  | 89,638 |  | 3,568,899 |  |
| Kimberly A. Ross                          | — |  | — |  | 79,524 |  | 4,509,405 |  |
| Belgacem Chariag                          | — |  | — |  | 29,909 |  | 1,230,637 |  |
| Arthur L. Soucy                           | — |  | — |  | 20,122 |  | 800,146 |  |
| Derek Mathieson                           | — |  | — |  | 21,605 |  | 861,223 |  |
| Alan R. Crain                             | — |  | — |  | 143,886 |  | 8,577,147 |  |

|     |                                                                                                                                                                                                                                           |
|-----|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| (1) | The value realized upon the exercise of the option award is determined by multiplying the number of shares acquired on exercise by the difference between the market price of the stock at exercise and the exercise price of the option. |

|     |                                                                                                                                                                                                          |
|-----|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| (2) | The value realized upon the vesting of the stock awards is determined by multiplying the number of shares of stock by the closing price of the stock on the last trading date prior to the vesting date. |

|                     |
|---------------------|
|                     |  |  |  |  |  |  |
| Name                | Plan Name | Number of Years Credited Service (1)   (#) | Present Value of Accumulated   Benefit (2)($) | Payments During Last Fiscal Year($) |
| Martin S. Craighead | Pension Plan | 15 |  | 156,824 | — |  |
| Kimberly A. Ross    | Pension Plan | 2 |  | 22,428 | — |  |
| Belgacem Chariag    | Pension Plan | 7 |  | 29,828 | — |  |
| Arthur L. Soucy     | Pension Plan | 8 |  | 77,514 | — |  |
| Derek Mathieson     | Pension Plan | 8 |  | 57,796 | — |  |
| Alan R. Crain       | Pension Plan | 15 |  | 189,148 | — |  |

|     |                                                                                                                                                                                                                                                                                                                                                                                                                                                     |
|-----|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| (1) | The number of years of credited service is less than the actual years of service for Messrs. Craighead and Crain because the Pension Plan was not adopted until 2002. Mr. Craighead is eligible for early retirement (as that term is defined under the Pension Plan) which allows him to receive his plan benefits on his early retirement date rather than waiting until the normal retirement age of 65. Mr. Crain retired on December 29, 2016. |

|     |                                                                                                                                                                                                                                                   |
|-----|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| (2) | For a discussion of valuation assumptions, see “Note 14 - Employee Benefit Plans” of the Notes to Consolidated Financial Statements included in our Annual Report under Item 8 of the Form 10-K for the year ended December 31, 2016. |

----

|                     |
|---------------------|
|                     |  |  |  |  |  |  |  |  |  |  |
| Name                | Executive Contributions in Last FY (1)($) | Registrant Contributions in Last FY (2)($) | Aggregate Earnings in Last FY($) | Aggregate Withdrawals/Distributions ($) | Aggregate Balance at Last FYE ($) |
| Martin S. Craighead | 273,159 |  | 321,053 |  | 160,754 |  | — |  | 4,959,359 |  |
| Kimberly A. Ross    | — |  | 177,710 |  | 727 |  | — |  | 281,596 |  |
| Belgacem Chariag    | 87,360 |  | 134,699 |  | 46,943 |  | — |  | 1,309,551 |  |
| Arthur L. Soucy     | 190,555 |  | 92,953 |  | 82,332 |  | — |  | 1,555,303 |  |
| Derek Mathieson     | 89,378 |  | 105,997 |  | 1,776 |  | (163,062 | ) | 651,108 |  |
| Alan R. Crain       | 45,000 |  | 362,260 |  | 187,677 |  | — |  | 3,500,547 |  |

|     |                                                                                                                                                                                                                                |
|-----|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| (1) | Amounts shown in the “Executive Contributions in Last FY” column are also included in the “Salary” and “Non-Equity Incentive Plan Compensation” columns of the Summary Compensation Table. |

|     |                                                                                                                                                                                       |
|-----|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| (2) | Amounts shown in the “Registrant Contributions in Last FY” column are also included in the “All Other Compensation” column of the Summary Compensation Table. |

|         |                                                                                                                                              |
|---------|----------------------------------------------------------------------------------------------------------------------------------------------|
| • | all outstanding options to acquire our stock, granted prior to October 30, 2016, would have become fully vested and immediately exercisable; |

|         |                                                                                                                                                          |
|---------|----------------------------------------------------------------------------------------------------------------------------------------------------------|
| • | all outstanding restricted stock awards and restricted stock units granted prior to October 30, 2016 would have become fully vested and non-forfeitable; |

|         |                                                                                                                                                                                                                  |
|---------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| • | shares equal to the number of performance units (settled in shares and granted prior to October 30, 2016) specified in the Senior Executive's performance unit award agreement, multiplied by the number of days |

|         |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    |
|---------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| • | for grandfathered Senior Executives, a lump-sum cash payment (a “gross-up” payment) in an amount equal to the excise taxes that may be imposed under the “golden parachute” rules on payments and benefits received in connection with the Change in Control. The gross-up payment would make the Senior Executive whole for the excise taxes (and for all taxes on the gross-up payment) in respect of payments and benefits received pursuant to all the Company's plans, agreements and arrangements (including for example, acceleration of vesting of equity awards); |

|         |                                                                                                             |
|---------|-------------------------------------------------------------------------------------------------------------|
| • | accelerated vesting of all the Senior Executive's accounts under the SRP, to the extent not already vested; |

|         |                                                                                                                                                                                                                                                                                                                                         |
|---------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| • | reimbursement for any legal fees and expenses incurred by the Senior Executive in seeking in good faith to enforce the Change in Control Agreement or in connection with any tax audit or proceeding relating to the application of parachute payment excise taxes to any payment or benefit under the Change in Control Agreement; and |

|         |                                                                                                                                                                                                                                                                                                                                          |
|---------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| • | an amount equal to his/her annual incentive bonus computed as if the target level of performance had been achieved, multiplied by a fraction, the numerator of which is the number of the Senior Executive's months of participation during the calendar year through the date of Change in Control, and the denominator of which is 12. |

|         |                                                                                                                                     |
|---------|-------------------------------------------------------------------------------------------------------------------------------------|
| • | the individuals who are incumbent directors cease for any reason to constitute a majority of the members of our Board of Directors; |

|         |                                                                                                                                                                                                                                                                                                                                                                                                                                                                   |
|---------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| • | the consummation of a merger of us or our affiliate with another entity, such as the pending Transaction with GE, unless the individuals and entities who were the beneficial owners of our voting securities outstanding immediately prior to such merger own, directly or indirectly, at least 50% of the combined voting power of our voting securities, the surviving entity or the parent of the surviving entity outstanding immediately after such merger; |

|         |                                                                                                                                                                                                                                                                                              |
|---------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| • | any person, other than us, our affiliate or another specified owner (as defined in the Change in Control Agreements), becomes a beneficial owner, directly or indirectly, of our securities representing 30% or more of the combined voting power of our then outstanding voting securities; |

|         |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              |
|---------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| • | a sale, transfer, lease or other disposition of all or substantially all of our assets (as defined in the Change in Control Agreements) is consummated (an “asset sale”), unless (i) the individuals and entities who were the beneficial owners of our voting securities immediately prior to such asset sale own, directly or indirectly, 50% or more of the combined voting power of the voting securities of the entity that acquires such assets in such asset sale or its parent immediately after such asset sale in substantially the same proportions as their ownership of our voting securities immediately prior to such asset sale or (ii) the individuals who comprise our Board of Directors immediately prior to such asset sale constitute a majority of the board of directors or other governing body of either the entity that acquired such assets in such asset sale or its parent (or a majority plus one member where such board or other governing body is comprised of an odd number of directors); or |

|         |                                                                                                                                                                               |
|---------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| • | our stockholders approve a plan of complete liquidation or dissolution of us.                 |

----

|         |                                                                                                                                     |
|---------|-------------------------------------------------------------------------------------------------------------------------------------|
| • | a lump-sum payment equal to three times the Senior Executive's highest base salary (as defined in the Change of Control Agreement); |

|         |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  |
|---------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| • | a lump-sum payment equal to the Senior Executive's highest bonus amount (as defined in the Change of Control Agreement), prorated based upon the number of days of his/her service during the performance period (reduced by any payments received by the Senior Executive under the Company's annual incentive bonus, in connection with the Change in Control if the Senior Executive's termination of employment occurs during the same calendar year in which the Change in Control occurs); |

|         |                                                                                                                                                                                                                                                                                                                                                       |
|---------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| • | a lump-sum payment equal to three times the greater of (i) the Senior Executive's earned highest bonus amount or (ii) the Senior Executive's highest base salary multiplied by the Senior Executive's applicable multiple, which, as of December 31, 2016, was 1.2 for Messrs. Craighead, Soucy, and Mathieson, and 1.0 for Ms. Ross and Mr. Chariag; |

|         |                                                                                                                                                             |
|---------|-------------------------------------------------------------------------------------------------------------------------------------------------------------|
| • | all outstanding restricted stock awards and restricted stock units granted on or after October 30, 2016 would have become fully vested and non-forfeitable; |

|         |                                                                                       |
|---------|---------------------------------------------------------------------------------------|
| • | continuation of accident and health insurance benefits for an additional three years; |

|         |                                                                                                                                                                                                                                                                                                                                             |
|---------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| • | a lump-sum payment equal to the sum of (i) the cost of the Senior Executive's perquisites in effect prior to his/her termination of employment for the remainder of the calendar year and (ii) the cost of the Senior Executive's perquisites in effect prior to his/her termination of employment for an additional three years; |

|         |                                                                                                                                                                                                                                                                               |
|---------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| • | a lump-sum payment equal to the undiscounted value of the benefits the Senior Executive would have received had the Senior Executive continued to participate in the Thrift Plan, the Pension Plan and the SRP for an additional three years, assuming for this purpose that: |

|     |                                                                                                                                  |
|-----|----------------------------------------------------------------------------------------------------------------------------------|
| (1) | the Senior Executive's compensation during that three-year period were his/her highest base salary and highest bonus amount; and |

|     |                                                                                                                                                                                                   |
|-----|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| (2) | the Senior Executive's contributions to and accruals under those plans remained at the levels in effect as of the date of the Change in Control or the date of termination, whichever is greater; |

|         |                                                                                                                                                                                                                                                                                                                                                                  |
|---------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| • | eligibility for our retiree medical program if the Senior Executive would have become entitled to participate in that program had he/she remained employed for an additional three years. The value of this benefit is the aggregate value of the medical coverage utilizing the assumptions applied under FASB ASC Topic 715, Compensation-Retirement Benefits; |

|         |                                                                                                                                                                                           |
|---------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| • | a lump-sum payment equivalent to 36 multiplied by the monthly basic life insurance premium applicable to the Senior Executive's basic life insurance coverage on the date of termination; |

|         |                                                              |
|---------|--------------------------------------------------------------|
| • | a lump-sum payment of $30,000 for outplacement services; and |

----

|         |                                                                                                                                                                                                                                                                       |
|---------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| • | a lump-sum payment equal to the amount of interest that would be earned on any of the foregoing payments subject to a six-month payment delay under Section 409A using the six-month London Interbank Offered Rate plus two percentage points, excluding Mr. Chariag. |

|         |                                                                                                           |
|---------|-----------------------------------------------------------------------------------------------------------|
| • | all outstanding restricted stock awards granted by us would have become fully vested and non-forfeitable; |

|         |                                                                                             |
|---------|---------------------------------------------------------------------------------------------|
| • | all outstanding stock options granted by us would have become fully vested and exercisable; |

|         |                                                                                                                                                                                                                                                                                                       |
|---------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| • | shares equal to the number of performance units (settled in shares) specified in the Senior Executive's performance unit award agreement, multiplied by the number of days during the performance period through December 31, 2016, divided by the number of days during the performance period; |

|         |                                                                                                                 |
|---------|-----------------------------------------------------------------------------------------------------------------|
| • | accelerated vesting of all the Senior Executive's accounts under the SRP, to the extent not already vested; and |

|         |                                                                                                                                                                                                                   |
|---------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| • | an amount equal to the Senior Executive's earned annual incentive bonus, prorated based upon the number of months of the Senior Executive's participation in the annual incentive bonus during the calendar year. |

|         |                                                                                             |
|---------|---------------------------------------------------------------------------------------------|
| • | all outstanding stock options granted by us would have become fully vested and exercisable; |

|         |                                                                                                                                                                                                                                                                                                       |
|---------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| • | shares equal to the number of performance units (settled in shares) specified in the Senior Executive's performance unit award agreement, multiplied by the number of days during the performance period through December 31, 2016, divided by the number of days during the performance period; |

|         |                                                                                                                 |
|---------|-----------------------------------------------------------------------------------------------------------------|
| • | accelerated vesting of all the Senior Executive's accounts under the SRP, to the extent not already vested; and |

|         |                                                                                                                                                                                                                   |
|---------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| • | an amount equal to the Senior Executive's earned annual incentive bonus, prorated based upon the number of months of the Senior Executive's participation in the annual incentive bonus during the calendar year. |

----

|         |                                                                                                                                                                     |
|---------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| • | a lump-sum cash payment equal to one and one-half times the Senior Executive's annual base salary in effect immediately prior to his/her termination of employment; |

|         |                                                                                    |
|---------|------------------------------------------------------------------------------------|
| • | outplacement services for a period of 12 months, but not in excess of $10,000; and |

|         |                                                                                                                                                                                                                                                                                                                                                                |
|---------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| • | if the Senior Executive's termination of employment results from a reduction of employment or the elimination of the Senior Executive's job, an amount equal to the Senior Executive's earned annual incentive bonus, prorated based upon the number of months of the Senior Executive's participation in the annual incentive bonus during the calendar year. |

|         |                                                                                                                                                                                                                    |
|---------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| • | the $400,000 guaranteed bonus for the first six months of 2016 for which she is eligible under the AICPE and the performance scorecard program (such bonus was originally scheduled to be paid in March 2017); and |

|         |                                                                                                                                                                                                   |
|---------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| • | accelerated vesting of 50,687 restricted stock units granted to her in 2015 and 2016 under the 2002 Director & Officer Plan (such vesting was originally scheduled to occur in January 2017). |

----

|                                                                                                                             |
|-----------------------------------------------------------------------------------------------------------------------------|
|                                                                                                                             |  |  |  |  |  |  |  |  |  |  |
|                                                                                                                        | Martin S. Craighead($) | Kimberly A. Ross (1)($) | Belgacem  Chariag($) | Derek Mathieson($) | Arthur L. Soucy($) |
| Payments Upon a Change in Control Without Termination of Employment                                                         |   |   |   |   |   |
| Accelerated Vesting of Option Awards (2)                                                                                    | — |  | — |  | 65,689 |  | 60,786 |  | 48,740 |  |
| Accelerated Vesting of Restricted Stock Awards                                                                              | 24,307,362 |  | 9,163,085 |  | 10,729,847 |  | 5,949,326 |  | 8,790,160 |  |
| Payment in Settlement of Performance Unit Awards Settled in Shares                                                          | — |  | 2,338,920 |  | 805,628 |  | 745,531 |  | 597,789 |  |
| SRP Vesting                                                                                                                 | — |  | 109,437 |  | — |  | — |  | — |  |
| Excise Tax Gross-Up                                                                                                         | — |  | — |  | — |  | — |  | — |  |
| Annual Incentive Bonus                                                                                                      | 1,479,808 |  | 800,000 |  | 647,981 |  | 509,046 |  | 420,764 |  |
| TOTAL                                                                                                                       | 25,787,170 |  | 12,411,442 |  | 12,249,145 |  | 7,264,689 |  | 9,857,453 |  |
|                                                                                                                        |   |   |   |   |   |
| Payments in the Event of a Change in Control and Termination of Employment With Good Reason or by the Company Without Cause |   |   |   |   |   |
| Accelerated Vesting of Option Awards (2)                                                                                    | — |  | — |  | 65,689 |  | 60,786 |  | 48,740 |  |
| Accelerated Vesting of Restricted Stock Awards                                                                              | 24,307,362 |  | 9,163,085 |  | 10,729,847 |  | 5,949,326 |  | 8,790,160 |  |
| Payment in Settlement of Performance Unit Awards Settled in Shares                                                          | — |  | 2,338,920 |  | 805,628 |  | 745,531 |  | 597,789 |  |
| Excise Tax Gross-Up (3)                                                                                                     | — |  | — |  | 3,076,555 |  | — |  | 2,829,239 |  |
| Severance Payment                                                                                                           | 9,680,152 |  | 4,880,035 |  | 4,500,000 |  | 4,224,000 |  | 4,290,000 |  |
| Highest Bonus Amount Prorated                                                                                               | 1,976,717 |  | 826,678 |  | 750,000 |  | 667,234 |  | 511,258 |  |
| Continuation of Accident and Health Insurance Benefits                                                                      | 58,335 |  | 47,215 |  | 57,687 |  | 57,609 |  | 43,795 |  |
| Perquisite Payment                                                                                                          | 69,389 |  | — |  | 51,375 |  | 5,400 |  | 56,907 |  |
| Payment for Loss of Thrift Plan, SRP and Pension Plan Accruals                                                              | 1,130,161 |  | 628,984 |  | 546,521 |  | 422,191 |  | 464,488 |  |
| Life Insurance Premium Payment                                                                                              | 13,046 |  | 8,698 |  | 7,610 |  | 6,958 |  | 6,578 |  |
| SRP Vesting                                                                                                                 | — |  | 109,437 |  | — |  | — |  | — |  |
| Outplacement Services                                                                                                       | 30,000 |  | 30,000 |  | 30,000 |  | 30,000 |  | 30,000 |  |
| Retiree Medical                                                                                                             | — |  | — |  | — |  | — |  | 8,767 |  |
| Interest Paid for Section 409A Six-Month Delay                                                                              | 187,888 |  | 91,716 |  | — |  | 79,743 |  | 81,253 |  |
| TOTAL                                                                                                                       | 37,453,050 |  | 18,124,768 |  | 20,620,912 |  | 12,248,778 |  | 17,758,974 |  |
|                                                                                                                        |   |   |   |   |   |
| Payments upon Death or Disability                                                                                           |   |   |   |   |   |
| Accelerated Vesting of Option Awards (2)                                                                                    | — |  | — |  | 65,689 |  | 60,786 |  | 48,740 |  |
| Accelerated Vesting of Restricted Stock Awards                                                                              | 24,307,362 |  | 9,163,085 |  | 10,729,847 |  | 5,949,326 |  | 8,790,160 |  |
| Payment in Settlement of Performance Unit Awards Settled in Shares                                                          | — |  | 2,338,920 |  | 805,628 |  | 745,531 |  | 597,789 |  |
| Annual Incentive Bonus (4)                                                                                                  | 1,479,808 |  | 800,000 |  | 647,981 |  | 509,046 |  | 420,764 |  |
| TOTAL                                                                                                                       | 25,787,170 |  | 12,302,005 |  | 12,249,145 |  | 7,264,689 |  | 9,857,453 |  |

----

|                                                                                                |
|------------------------------------------------------------------------------------------------|
|                                                                                                |  |  |  |  |  |  |  |  |  |  |
|                                                                                           | Martin S. Craighead($) | Kimberly A. Ross (1)($) | Belgacem  Chariag($) | Derek Mathieson($) | Arthur L. Soucy($) |
| Payments upon Retirement (2)                                                                   |   |   |   |   |   |
| Accelerated Vesting of Option Awards                                                           | — |  | — |  | — |  | — |  | — |  |
| Payment in Settlement of Performance Unit Awards Settled in Shares                             | — |  | — |  | — |  | — |  | — |  |
| Annual Incentive Bonus                                                                         | 1,479,808 |  | — |  | — |  | — |  | — |  |
| TOTAL                                                                                          | 1,479,808 |  | — |  | — |  | — |  | — |  |
|                                                                                           |   |   |   |   |   |
| Payments Upon Involuntary Termination of Employment Not in Connection with a Change of Control |   |   |   |   |   |
| 1½ x Base Salary                                                                          | 1,875,000 |  | 1,200,000 |  | 1,125,000 |  | 960,000 |  | 975,000 |  |
| Outplacement Services                                                                          | 10,000 |  | 10,000 |  | 10,000 |  | 10,000 |  | 10,000 |  |
| Annual Incentive Bonus (4)                                                                     | 1,479,808 |  | 800,000 |  | 647,981 |  | 509,046 |  | 420,764 |  |
| TOTAL                                                                                          | 3,364,808 |  | 2,010,000 |  | 1,782,981 |  | 1,479,046 |  | 1,405,764 |  |

|     |                                                                                                                                                                                                                                                                                                                               |
|-----|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| (1) | As of December 31, 2016, Ms. Ross did not have any outstanding option awards or performance units (settled in cash), was not vested in the SRP, and would not have been eligible for interest payments. Pursuant to her Change in Control Agreement, she is not eligible for excise tax gross-up or perquisite payments. |

|     |                                                                                                                                                                                                                                                                                                                                                                             |
|-----|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| (2) | As of December 31, 2016, Mr. Craighead is retirement eligible under the terms of the performance unit awards and stock options granted to them and under the terms of the AICPE. Ms. Ross and Messrs. Mathieson and Soucy are not retirement eligible under the terms of the performance unit awards and stock options granted to them or under the terms of the AICPE. |

|     |                                                                                                                                                                                                                                                                                      |
|-----|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| (3) | The amounts listed reflect gross-up payment estimates as of December 31, 2016. It is estimated that payments occurring at a near future date upon a change in control and termination of employment would generate a gross-up payment for Mr. Craighead of approximately $7,000,000. |

|     |                                                                                                                                                    |
|-----|----------------------------------------------------------------------------------------------------------------------------------------------------|
| (4) | The NEOs receive an amount equal to the earned annual incentive bonus, reduced so it reflects only participation prior to separation from service. |

----

|         |                                                                                                                           |
|---------|---------------------------------------------------------------------------------------------------------------------------|
| • | rewarding performance that supports the Company's core values of integrity, teamwork, performance,  learning and courage; |

|         |                                                                                                                                               |
|---------|-----------------------------------------------------------------------------------------------------------------------------------------------|
| • | providing a significant percentage of total compensation that is variable because it is at risk, based on predetermined performance criteria; |

|         |                                                                                                              |
|---------|--------------------------------------------------------------------------------------------------------------|
| • | requiring significant stock holdings to align the interests of senior executives with those of stockholders; |

|         |                                                                                                                                                                 |
|---------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------|
| • | designing competitive total compensation and rewards programs to enhance our ability to attract and retain knowledgeable and experienced senior executives; and |

|         |                                                                                      |
|---------|--------------------------------------------------------------------------------------|
| • | setting compensation and incentive levels that reflect competitive market practices. |

----

----

----

|                                                       |
|-------------------------------------------------------|
|                                                       |  |  |
|                                                  | 2016$ | 2015$ |
|                                                  | (in millions) | (in millions) |
| Audit fees                                            | 14 | 16 |
| Audit-related fees                                    |   |   |
|   Halliburton Merger & Integration Fees | 0.1 | 1.1 |
|   All Other Audit-Related Fees              | 0.2 | 0.2 |
| Tax fees                                              | 0.3 | 0.6 |
| All Other                                             | 0.1 | 0.5 |
| Total                                                 | 14.7 | 18.4 |

----

----

|         |                                                                                                                                                      |
|---------|------------------------------------------------------------------------------------------------------------------------------------------------------|
| • | Is it reasonable for Baker Hughes to assert it knows the will of undecided voters (and to artificially construe abstentions in favor of management)? |

|         |                                                                                                                                    |
|---------|------------------------------------------------------------------------------------------------------------------------------------|
| • | Half our Company's peers use a simple majority formula, and GE, our merger partner, also strikes abstentions from voting Formulas. |

|         |                                                                |
|---------|----------------------------------------------------------------|
| • | Depressing the appearance of support for stockholder concerns. |

|         |                           |
|---------|---------------------------|
| • | Subverting vote outcomes. |

----

|         |                           |
|---------|---------------------------|
| • | Distorting communication. |

----

----

----

----

|         |                                                                                                                                           |
|---------|-------------------------------------------------------------------------------------------------------------------------------------------|
| • | Providing effective oversight of the governance of the affairs of the Company in order to maximize long-term benefit to the stockholders; |

|         |                                                                                                                                                               |
|---------|---------------------------------------------------------------------------------------------------------------------------------------------------------------|
| • | Maintaining a viable succession plan for the office of the Chief Executive Officer (“CEO”) of the Company and other members of senior management; |

|         |                                                                                                   |
|---------|---------------------------------------------------------------------------------------------------|
| • | Evaluating the performance of the Board and identifying and recruiting new members for the Board; |

|         |                                                   |
|---------|---------------------------------------------------|
| • | Reviewing and approving long-term business plans; |

|         |                                                                                             |
|---------|---------------------------------------------------------------------------------------------|
| • | Appointing, approving the compensation and overseeing the work of the independent auditors; |

|         |                                                                                                                                                                                       |
|---------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| • | Overseeing certain compliance related issues, including accounting, internal audit, disclosure controls and internal controls, enterprise risk management and environmental policies; |

|         |                                                                                                                                                                 |
|---------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------|
| • | Reviewing quarterly earnings release and quarterly and annual financial statements to be filed with the Securities and Exchange Commission (“SEC”); |

|         |                                                                                                |
|---------|------------------------------------------------------------------------------------------------|
| • | Evaluating and setting the compensation of the CEO and other members of senior management; and |

|         |                                            |
|---------|--------------------------------------------|
| • | Adopting an appropriate governance policy. |

----

----

|             |
|-------------|
|             |  |
| Retirement: | The director's 75th birthday. |
| Attendance: | Any fiscal year in which a director fails to attend at least 66% of the meetings of the Board and any Committees of the Board on which the director serves. |

----

----

----

----

----

|         |                                                                                                                                                                                  |
|---------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| • | We are a responsible corporate citizen committed to the health and safety of people, protection of the environment, and compliance with laws, regulations, and company policies. |

|         |                                                                    |
|---------|--------------------------------------------------------------------|
| • | We are honest, trustworthy, respectful and ethical in our actions. |

|         |                           |
|---------|---------------------------|
| • | We honor our commitments. |

|         |                                                             |
|---------|-------------------------------------------------------------|
| • | We are accountable for our actions, successes and failures. |

|         |                                   |
|---------|-----------------------------------|
| • | We are committed to common goals. |

|         |                                                             |
|---------|-------------------------------------------------------------|
| • | We expect everyone to actively participate on the BHI team. |

|         |                                                              |
|---------|--------------------------------------------------------------|
| • | We openly communicate up, down, and across the organization. |

|         |                                          |
|---------|------------------------------------------|
| • | We value the diversity of our workforce. |

|         |                                   |
|---------|-----------------------------------|
| • | We willingly share our resources. |

|         |                                |
|---------|--------------------------------|
| • | We focus on what is important. |

|         |                                                  |
|---------|--------------------------------------------------|
| • | We establish and communicate clear expectations. |

|         |                                 |
|---------|---------------------------------|
| • | We relentlessly pursue success. |

|         |                                   |
|---------|-----------------------------------|
| • | We strive for flawless execution. |

|         |                                                                    |
|---------|--------------------------------------------------------------------|
| • | We work hard, celebrate our successes and learn from our failures. |

|         |                                                                                    |
|---------|------------------------------------------------------------------------------------|
| • | We continuously look for new ways to improve our products, services and processes. |

|         |                                                                                                                        |
|---------|------------------------------------------------------------------------------------------------------------------------|
| • | We expect development throughout each individual’s career by a combination of individual and company commitment. |

|         |                                                                                                           |
|---------|-----------------------------------------------------------------------------------------------------------|
| • | We learn from sharing past decisions and actions, both good and bad, to continuously improve performance. |

|         |                                                         |
|---------|---------------------------------------------------------|
| • | We improve by benchmarking and adopting best practices. |

|         |                                                          |
|---------|----------------------------------------------------------|
| • | We stand for what is right and support others who do so. |

|         |                                                         |
|---------|---------------------------------------------------------|
| • | We imagine and pursue new possibilities for our future. |

|         |                                                                         |
|---------|-------------------------------------------------------------------------|
| • | We take ownership of challenges, even those that appear insurmountable. |

|         |                                                        |
|---------|--------------------------------------------------------|
| • | We embrace change, both collectively and individually. |

----

|         |                                                     |
|---------|-----------------------------------------------------|
| • | We understand our priorities and performance goals. |

|         |                                    |
|---------|------------------------------------|
| • | We drive to do our part every day. |

|         |                                                  |
|---------|--------------------------------------------------|
| • | We support new ideas and take appropriate risks. |

|         |                                              |
|---------|----------------------------------------------|
| • | We take action to find and correct problems. |

|         |                                           |
|---------|-------------------------------------------|
| • | We commend each other on a job well done. |

|         |                                                       |
|---------|-------------------------------------------------------|
| • | We make it easy for customers to do business with us. |

|         |                                                        |
|---------|--------------------------------------------------------|
| • | We listen to our customers and understand their needs. |

|         |                                                                |
|---------|----------------------------------------------------------------|
| • | We plan ahead to deliver innovative, cost-effective solutions. |

|         |                                                                       |
|---------|-----------------------------------------------------------------------|
| • | We are dedicated to safe, flawless execution and top quality results. |

|         |                                                             |
|---------|-------------------------------------------------------------|
| • | We maintain a competitive cost structure for the long-term. |

|         |                                                                |
|---------|----------------------------------------------------------------|
| • | We utilize shared services to control cost for the enterprise. |

|         |                                                                              |
|---------|------------------------------------------------------------------------------|
| • | We seek the best value for Baker Hughes in our relationships with suppliers. |

|         |                                                                       |
|---------|-----------------------------------------------------------------------|
| • | We ruthlessly eliminate waste without compromising safety or quality. |

|         |                                                                    |
|---------|--------------------------------------------------------------------|
| • | We assign our people where they can make the biggest contribution. |

|         |                                                                                  |
|---------|----------------------------------------------------------------------------------|
| • | We allocate our investments to leverage the best opportunities for Baker Hughes. |

|         |                                                   |
|---------|---------------------------------------------------|
| • | We handle company assets as if they were our own. |

|         |                                                              |
|---------|--------------------------------------------------------------|
| • | We manage our balance sheet to enhance return on investment. |

----

|         |                                                |
|---------|------------------------------------------------|
| • | The size and existing composition of the Board |

|         |                                             |
|---------|---------------------------------------------|
| • | The number and qualifications of candidates |

|         |                                        |
|---------|----------------------------------------|
| • | The benefit of continuity on the Board |

|         |                                                                                                                      |
|---------|----------------------------------------------------------------------------------------------------------------------|
| • | The relevance of the candidate’s background and experience to current and foreseeable business of the Company. |

|    |                                                                                                                                                       |
|----|-------------------------------------------------------------------------------------------------------------------------------------------------------|
| A) | Recommend candidates for director positions who will help create a collective membership on the Board with varied experience and perspective and who: |

|    |                                                                                                                                                                  |
|----|------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| i) | Have demonstrated leadership, and significant experience in an area of endeavor such as technology, business, finance, law, public service, banking or academia; |

|     |                                                                                                                                    |
|-----|------------------------------------------------------------------------------------------------------------------------------------|
| ii) | Comprehend the role of a public company director, particularly the fiduciary obligations owed to the Company and its stockholders; |

|      |                                                                                                              |
|------|--------------------------------------------------------------------------------------------------------------|
| iii) | Have relevant expertise and experience, and are able to offer advice and guidance based upon that expertise; |

|     |                                                                                                                                                                                  |
|-----|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| iv) | Have a substantive understanding of domestic considerations and geopolitics, especially those pertaining to the service sector of the oil and gas and energy related industries; |

|    |                                                    |
|----|----------------------------------------------------|
| v) | Will dedicate sufficient time to Company business; |

|     |                                                                                            |
|-----|--------------------------------------------------------------------------------------------|
| vi) | Exhibit integrity, sound business judgment and support for the Core Values of the Company; |

|      |                                  |
|------|----------------------------------|
| vii) | Understand financial statements; |

|       |                                                                                                                           |
|-------|---------------------------------------------------------------------------------------------------------------------------|
| viii) | Are independent as defined by the Securities and Exchange Commission (“SEC”) and the New York Stock Exchange; |

|     |                                                                                                                                                                                                                                                       |
|-----|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| ix) | Support the ideals of the Company’s Business Code of Conduct and are not engaged in any activity adverse to, or do not serve on the board of another company whose interests are adverse to, or in conflict with the Company’s interests; |

|    |                                                                                                                                                                                                                           |
|----|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| x) | Possess the ability to oversee, as a director, the affairs of the Company for the benefit of its stockholders while keeping in perspective the interests of the Company’s customers, employees and the  public; and |

|     |                                               |
|-----|-----------------------------------------------|
| xi) | Are able to exercise sound business judgment. |

|    |                                                                                                                                              |
|----|----------------------------------------------------------------------------------------------------------------------------------------------|
| B) | Maintain a Board that reflects diversity, including but not limited to gender, ethnicity, background, country of citizenship and experience. |

----

----

|    |                                                                                                                            |
|----|----------------------------------------------------------------------------------------------------------------------------|
| 1. | Chairman, CEO, the Committee, or other Board members identify a need to fill vacancies or add newly created directorships. |

|    |                                                                                                                                                                                                                                 |
|----|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| 2. | Chairman of the Committee initiates search, working with staff support and seeking input from the Board members and senior management, and hiring a search firm or obtaining advice from legal or other advisors, if necessary. |

|    |                                                                                                                                                                                                                                                                                                                                                    |
|----|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| 3. | Candidates, including any candidates properly proposed by stockholders in accordance with the Company’s Bylaws, that satisfy criteria as described in the Company’s “Guidelines for Membership on the Board of Directors” or otherwise qualify for membership on the Board, are identified and presented to the Committee. |

|    |                                                                                                                                                                              |
|----|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| 4. | Determine if the Committee members, Board members or senior management have a basis to initiate contact with preferred candidates; or if appropriate, utilize a search firm. |

|    |                                                                                             |
|----|---------------------------------------------------------------------------------------------|
| 5. | Chairman, CEO and at least one member of the Committee interviews prospective candidate(s). |

|    |                                             |
|----|---------------------------------------------|
| 6. | Full Board to be kept informed of progress. |

|    |                                                                                                   |
|----|---------------------------------------------------------------------------------------------------|
| 7. | The Committee meets to consider and approve final candidate(s) (conduct interviews as necessary). |

|    |                                                                                                                                                                      |
|----|----------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| 8. | The Committee will propose to the full Board candidates for Board membership to fill vacancies, or to stand for election at the next Annual Meeting of Stockholders. |

----

|    |                                                                                                                                                                                                                                                                                                                                    |
|----|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| 1. | A director who is an employee, or whose immediate family member is an executive officer, of the Company is not independent until three years after the end of such employment relationship.  Employment as an interim Chairman or CEO shall not disqualify a director from being considered independent following that employment. |

|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          |
|----|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| 2. | A director who receives, or whose immediate family member receives, more than $120,000 per year in direct compensation from the Company, other than director and committee fees and pension or other forms of deferred compensation for prior service (provided such compensation is not contingent in any way on continued service), is not independent until three years after he or she ceases to receive more than $120,000 per year in such compensation.  Compensation received by a director for former service as an interim Chairman or CEO need not be considered in determining independence under this test.  Compensation received by an immediate family member for service as a non-executive employee of the Company need not be considered in determining independence under this test. |

|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            |
|----|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| 3. | A director who is affiliated with or employed by a present or former internal or external auditor of the Company is not “independent” until three years after the end of the affiliation or the employment or auditing relationship.  A director, however, is still considered independent if the director’s immediate family member currently works for the company’s auditor, as long as the immediate family member is not a partner of the company’s auditor or is not personally involved (and has not been personally involved for the past three years) in the company’s audit. |

|    |                                                                                                                                                                                                                                                                                                                                                |
|----|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| 4. | A director who is employed, or whose immediate family member is employed, as an executive officer of another company where any of the Company’s present executives serve on that company’s compensation committee is not “independent” until three years after the end of such service or the employment relationship. |

|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   |
|----|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| 5. | A director who is an executive officer or an employee, or whose immediate family member is an executive officer, of a company that makes payments to, or receives payments from, the Company for property or services in an amount which, in any single fiscal year, exceeds the greater of $1 million, or 2% of the consolidated gross revenues of such other company employing such executive officer or employee, is not “independent” until three years after falling below such threshold. In applying this test, both the payments and the consolidated gross revenues to be measured shall be those reported in the last completed fiscal year.  The look-back provision for this test applies solely to the financial relationship between the Company and the director or immediate family member’s current employer; the Company need not consider former employment of the director or immediate family member.  Charitable organizations shall not be considered “companies” for purposes of this test, provided however that the Company shall disclose in its annual proxy statement any charitable contributions made by the Company to any charitable organization in which a director serves as an |

----

|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     |
|----|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| 1. | A director who is a member of the Audit/Ethics Committee other than in his or her capacity as a member of the Audit/Ethics Committee, the Board, or any other Board committee, may not accept directly or indirectly any consulting, advisory, or other compensatory fee from the Company or any subsidiary thereof, provided that, unless the rules of the NYSE provide otherwise, compensatory fees do not include the receipt of fixed amounts of compensation under a retirement plan (including deferred compensation) for prior service with the Company (provided that such compensation is not contingent in any way on continued service). |

|    |                                                                                                                                                                                                                                                            |
|----|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| 2. | A director, who is a member of the Audit/Ethics Committee may not, other than in his or her capacity as a member of the Audit/Ethics Committee, the Board, or any other Board committee, be an affiliated person of the Company or any subsidiary thereof. |

|    |                                                                                                                                                                 |
|----|-----------------------------------------------------------------------------------------------------------------------------------------------------------------|
| 3. | A member of the Audit/Ethics Committee may not simultaneously serve on the audit committees of more than two other public companies in addition to the Company. |

|     |                                                                                        |
|-----|----------------------------------------------------------------------------------------|
| (a) | An understanding of generally accepted accounting principles and financial statements; |

|     |                                                                                                                                          |
|-----|------------------------------------------------------------------------------------------------------------------------------------------|
| (b) | The ability to assess the general application of such principles in connection with the accounting for estimates, accruals and reserves; |

|     |                                                                                                                                                                                                                                                                                                                                                                                                        |
|-----|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| (c) | Experience preparing, auditing, analyzing or evaluating financial statements that present a breadth and level of complexity of accounting issues that are generally comparable to the breadth and complexity of issues that can reasonably be expected to be raised by the registrant’s financial statements, or experience actively supervising one or more persons engaged in such activities; |

|     |                                                                                   |
|-----|-----------------------------------------------------------------------------------|
| (d) | An understanding of internal controls and procedures for financial reporting; and |

|     |                                                |
|-----|------------------------------------------------|
| (e) | An understanding of audit committee functions. |

|     |                                                                                                                                                                                                                             |
|-----|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| (a) | Education and experience as a principal financial officer, principal accounting officer, controller, public accountant or auditor or experience in one or more positions that involve the performance of similar functions; |

|     |                                                                                                                                                                             |
|-----|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| (b) | Experience actively supervising a principal financial officer, principal accounting officer, controller, public accountant, auditor or person performing similar functions; |

|     |                                                                                                                                                                           |
|-----|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| (c) | Experience overseeing or assessing the performance of companies or public accountants with respect to the preparation, auditing or evaluation of financial statements; or |

|     |                            |
|-----|----------------------------|
| (d) | Other relevant experience. |

----

|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      |
|----|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| 2. | The Nomination Notice shall set forth (a) all information relating to the nominee as required to be disclosed in solicitations of proxies for election of directors, or as otherwise required, in each case pursuant to Regulation 14A under the Securities Exchange Act of 1934 or any successor regulation thereto (including such person's written consent to be named in the proxy statement as a nominee and to serve as a director if elected), (b) the nominee’s independence, any voting commitments and/or other obligations such person will be bound by as a director, and any material relationships between such person and (1) the nominating stockholder, or (2) the beneficial owner, if any, on whose behalf the nomination is made (each nominating party and each beneficial owner, a “nominating party”), including compensation and financial transactions, (c) the nominating party’s name and record address, (d) the class, series, and number of shares of the Company that are owned beneficially and of record, directly or indirectly, by each nominating party, (e) all other related ownership interests directly or indirectly owned beneficially by each nominating party, and (f) any interest of each nominating party in such nomination.  At the request of the Board, any person nominated by the Board for election as a director shall furnish to the Corporate Secretary of the Company that information required to be set forth in a stockholder's Nomination Notice that pertains to the nominee. |

----

----

----

----

|         |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      |
|---------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| • | Receive and review reports from the independent registered public accounting firm pursuant to the Sarbanes-Oxley Act of 2002 (“SOX”) and Section 10(A)(k) of the Exchange Act regarding:  (i) all critical accounting policies and practices being used; (ii) all alternative treatments of financial information within generally accepted accounting principles that have been discussed with management, and the treatment preferred by the independent registered public accounting firm; and (iii) other material written communications between the independent auditor and management, such as any management letter or schedule of unrecorded audit adjustments. |

|         |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            |
|---------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| • | On an annual basis, receive and review formal written reports from the independent registered public accounting firm regarding the auditors' independence required by the Public Company Accounting Oversight Board (“PCAOB”) Ethics and Independence Rule 3526 “Communication with Audit Committees Concerning Independence,” giving consideration to the range of audit and non-audit services performed by them and all their relationships with the Company, as well as a report describing the (i) independent registered public accounting firm's internal quality-control procedures; (ii) any material issues raised by the most recent internal quality-control review or  peer review, of the independent registered public accounting firm, or by any inquiry or investigation by governmental or professional authorities; within the preceding five years with respect to one or more independent audits carried out by the auditors; and (iii) any steps taken to deal with such issues.  Conduct an active discussion with the independent registered public accounting firm with respect to any disclosed relationships or services that may impact the objectivity and independence of the auditors.  Select the independent registered public accounting firm to be employed or discharged by the Company. Review and evaluate competence of partners and managers of the independent registered public accounting firm who lead the audit.  As required by law, ensure the rotation of the lead audit partner having primary responsibility for the Company's audit and the audit partner responsible for reviewing the audit.  Consider whether there should be a rotation of the independent registered public accounting firm.  The Committee shall establish hiring policies for the Company of employees or former employees of the independent registered public accounting firm in accordance with the NYSE rules, SOX and as specified by the SEC and review and discuss with management and the independent registered public accounting firm any proposals for hiring any key member of the independent registered public accounting firm's team. |

|         |                                                                                                                                                                                                                                                                                                                                                                                                                                                  |
|---------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| • | Prior to commencement of the annual audit, review with management, the corporate auditors and the independent registered public accounting firm the proposed scope of the audit plan and fees, including the areas of business to be examined, the personnel to be assigned to the audit, the procedures to be followed, special areas to be investigated, as well as the program for integration of the independent and internal audit efforts. |

|         |                                                                                                                                                                                                                                   |
|---------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| • | Review policies and procedures for the engagement of the independent registered public accounting firm to provide audit and non-audit services, giving due consideration to whether the independent auditor's performance of non- |

----

|         |                                                                                                                                                                                                                                                                                                                                                                                            |
|---------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| • | Review with management and the independent registered public accounting firm the accounting and reporting policies and procedures that may be viewed as critical accounting estimates, any improvements, questions of choice and material changes in accounting policies and procedures, including interim accounting, as well as significant accounting, auditing and SEC pronouncements. |

|         |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              |
|---------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| • | Review with management and the independent registered public accounting firm any financial reporting and disclosure issues, including material correcting adjustments and off-balance sheet financings and relationships, if any. Discuss significant judgment matters made in connection with the preparation of the Company's financial statements and ascertain that any significant disagreements among them have been satisfactorily resolved. Ascertain that no restrictions were placed by management on implementation of the independent or corporate auditors' examinations. Regularly scheduled executive sessions will be held for this purpose. |

|         |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           |
|---------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| • | Review with management, the corporate auditors and the independent registered public accounting firm the results of (i) the annual audit prior to release of the audited financial statements in the Company's annual report on Form 10-K filed with the SEC, including a review of the MD&A section; and (ii) the quarterly financial statements prior to release in the Company's quarterly report on Form 10-Q filed with the SEC, including a review of the MD&A section. Have management review the Company's financial results with the Board of Directors. |

|         |                                                                                                                                                                                                   |
|---------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| • | Review and discuss with management and the independent registered public accounting firm management's report on internal control prior to the filing of the Company's annual report on Form 10-K. |

|         |                                                                                                                                                                                                                                                                                                                                                                           |
|---------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| • | Establish guidelines with respect to earnings releases and financial information and earnings guidance provided to analysts and rating agencies. The Committee may request a prior review of any annual or quarterly earnings release or earnings guidance and delegate to the Chairman of the Committee the authority to review any such earnings releases and guidance. |

|         |                                                                                                                                                                                                                                                                                                                                                                                            |
|---------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| • | Review with the Board of Directors any issues that arise with respect to the quality or integrity of the Company's financial statements and financial reporting system, the Company's compliance with legal or regulatory requirements, the performance and independence of the Company's independent registered public accounting firm or the performance of the internal audit function. |

|         |                                                                                                                                                                                                                                                                                 |
|---------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| • | Review guidelines and policies on enterprise risk management including risk assessment and risk management related to the Company's major financial and related information technology risk exposures and the steps management has taken to monitor and control such exposures. |

|         |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 |
|---------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| • | Annually prepare an audit committee report for inclusion in the Company's proxy statement stating that the Committee has (i) reviewed and discussed the audited financial statements with management; (ii) discussed with the independent registered public accounting firm the matters required to be discussed by Auditing Standard No. 1301, "Communications with Audit Committees"; (iii) received a formal written report from the independent registered public accounting firm concerning the auditors' independence required by the PCAOB's Ethics and Independence Rule 3526, “Communication with Audit Committees Concerning Independence” and has discussed with the independent accountant the independent accountant's independence; and (iv) based upon the review and discussion of the audited financial statements with both management and the independent registered public accounting firm, the Committee recommended to the Board of Directors that the audited financial statements be included in the Company's Annual Report on Form 10-K for the last fiscal year for filing with the SEC. |

|         |                                                                                                       |
|---------|-------------------------------------------------------------------------------------------------------|
| • | Cause the Charter to be included periodically in the proxy statement as required by applicable rules. |

|         |                                                                                                                                                                                             |
|---------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| • | Review actions taken by management on the independent registered public accounting firm and corporate auditors' recommendations relating to organization, internal controls and operations. |

----

|         |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             |
|---------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| • | Meet separately and periodically with management, the corporate auditors and the independent registered public accounting firm to review the responsibilities, budget and staffing of the Company's internal audit function, the effectiveness of the Company's internal controls, including computerized information systems controls, and security.  Review the Company's annual internal audit plan, staffing and budget, and receive regular reports on their activities, including significant findings and management's actions.  Review annually the audit of the travel and entertainment expenses of the Company's senior management.  Review annually the audit of the travel expenses of the members of the Company's Board of Directors. At least every three years the Committee reviews the Corporate Audit Department Charter. At least every five years the Committee reviews the report received from a qualified, independent audit firm regarding its quality assurance review of the Company's internal audit function. |

|         |                                                                                                                                                                                                                                        |
|---------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| • | Review membership of the Company's “Disclosure Control and Internal Control Committee” (“DCIC”), the DCIC's scheduled activities and the DCIC's quarterly report.  Review on an annual basis the DCIC Charter. |

|         |                                                                                                                                                                                                                                                                                                                                   |
|---------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| • | Receive reports from the CEO and CFO on any material weaknesses and significant deficiencies in the design or operation of certain internal controls over financial reporting and any fraud, whether or not material, that involves management or other employees who have a significant role in the Company's internal controls. |

|         |                                                                                                                                             |
|---------|---------------------------------------------------------------------------------------------------------------------------------------------|
| • | Review reports, media coverage and similar public information provided to analysts and rating agencies, as the Committee deems appropriate. |

|         |                                                                                                                                                                                                                                                                                                                                                                                               |
|---------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| • | Establish formal procedures for (i) the receipt, retention and treatment of complaints received by the Company regarding accounting, internal accounting controls or auditing matters, (ii) the confidential, anonymous submissions by Company employees of concerns regarding questionable accounting or auditing matters, and (iii) the protection of reporting employees from retaliation. |

|         |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  |
|---------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| • | Annually review with the independent registered public accounting firm any audit problems or difficulties and management's response. The Committee must regularly review with the independent auditor any difficulties the auditor encountered in the course of the audit work, including any restrictions on the scope of the independent registered public accounting firm' activities or on access to requested information, and any significant disagreements with management. Among the items the Committee may want to review with the auditors are:  any accounting adjustments that were noted or proposed by the auditor but were “passed” (as immaterial or otherwise); any communications between the audit team and the audit firm's national office respecting auditing or accounting issues presented by the engagement; and any “management” or “internal control” letter issued, or proposed to be issued, by the audit firm to the Company. |

|         |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       |
|---------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| • | Review policies and procedures that the Company has implemented regarding compliance with applicable federal, state and local laws and regulations, including the Company's Business Code of Conduct and its Foreign Corrupt Practices Act policies. Monitor the effectiveness of these policies and procedures for compliance with the U.S. Federal Sentencing Guidelines, as amended, and institute any changes or revisions to such policies and procedures may be deemed, warranted or necessary. |

|         |                                                                                                                                                                                                                                                                                                                         |
|---------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| • | Review in conjunction with counsel (i) any legal matters that could have significant impact on the organization's financial statements; (ii) correspondence and material inquiries received from regulators or governmental agencies; and (iii) all matters relating to the ethics of the Company and its subsidiaries. |

|         |                                                                                                                                                                                                                 |
|---------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| • | Coordinate the Company's compliance with inquiries from any government officials concerning legal compliance in the areas covered by the Business Code of Conduct and the Foreign Corrupt Practices Act policy. |

|         |                                                                                                                 |
|---------|-----------------------------------------------------------------------------------------------------------------|
| • | Respond to such other duties as may be assigned to the Committee, from time to time, by the Board of Directors. |

----

----

|                                                                                   |
|-----------------------------------------------------------------------------------|
|                                                                                   |  |  |  |
|                                                                              | Six Months Ended |
| (In millions, except per share amounts)                                           | June 30, 2016 |
| Net loss attributable to Baker Hughes (GAAP)                                      | $ | (1,892 | ) |
|    Identified item:                                                |   |
|      Impairment and restructuring charges                | 1,286 |  |
|      Goodwill impairment                                 | 1,841 |  |
|      Merger and related costs                            | 180 |  |
|      Merger termination fee                              | (3,500) |  |
|      Inventory adjustments                               | 621 |  |
|      Loss on early extinguishment of debt                | 142 |  |
|    Total identified items                                          | 570 |  |
|      Income taxes on identified items                    | 229 |  |
|    Identified items, net of income taxes                           | 799 |  |
| Adjusted net loss (non-GAAP)                                                      | $ | (1,093 | ) |
|    Income Taxes                                                    | 290 |  |
|    Interest                                                        | 103 |  |
|    Other                                                           | (1 | ) |
| Adjusted operating loss (non-GAAP)                                                | $ | (701 | ) |
|                                                                              |   |
| Basic and diluted loss per share attributable to Baker Hughes (GAAP)              | $ | (4.30 | ) |
| Adjusted basic and diluted loss per share attributable to Baker Hughes (non-GAAP) | $ | (2.48 | ) |
| Weighted average common shares diluted                                            | 440 |  |
|                                                                              |   |

|                                                                    |
|--------------------------------------------------------------------|
|                                                                    |  |  |  |
|                                                               | Six Months Ended |
| (In millions, except per share amounts)                            | December 31, 2016 |
| Net loss attributable to Baker Hughes (GAAP)                       | $ | (846 | ) |
|    Identified item:                                 |   |
|      Impairment and restructuring charges | 449 |  |
|      Goodwill impairment                  | 17 |  |
|      Merger and related costs             | 19 |  |
|      Inventory adjustments                | (4 | ) |
|      Loss on sales of business interest   | 97 |  |
|      Litigation settlements               | 41 |  |
|    Total identified items                           | 619 |  |
|      Income taxes on identified items     | 37 |  |
|    Identified items, net of income taxes            | 656 |  |
| Adjusted net loss (non-GAAP)                                       | $ | (190 | ) |
|    Income Taxes                                     | 140 |  |
|    Interest                                         | 75 |  |
|    Other                                            | 3 |  |
| Adjusted operating profit (non-GAAP)                               | $ | 28 |  |

----

----