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|----------------------------------------------------------------|
|                                                                |  |  |
| Delaware                                                       |   | 76-0207995 |
| (State or other jurisdiction of incorporation or organization) |   | (I.R.S. Employer Identification No.) |
|                                                           |   |
| 2929 Allen Parkway, Suite 2100, Houston, Texas                 |   | 77019-2118 |
| (Address of principal executive offices)                       |   | (Zip Code) |

|                                      |
|--------------------------------------|
|                                      |  |  |
| Title of each class                  |   | Name of each exchange on which registered |
| Common Stock, $1 Par Value per Share |   | New York Stock Exchange |
|                                 |   | SIX Swiss Exchange |

|                              |
|------------------------------|
|                              |  |  |  |  |  |  |
| Large accelerated filer  [X] |   | Accelerated filer  [  ] |    | Non-accelerated filer  [  ] |    | Smaller reporting company  [  ] |

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|               |
|---------------|
|               |  |  |
|          |   | Page |
|          |   |   |
|          | Part I |   |
|          |   |   |
| Item 1.  | Business | 2 |
| Item 1A. | Risk Factors | 9 |
| Item 1B. | Unresolved Staff Comments | 16 |
| Item 2.  | Properties | 16 |
| Item 3.  | Legal Proceedings | 16 |
| Item 4.  | Mine Safety Disclosures | 17 |
|          |   |   |
|          | Part II |   |
|          |   |   |
| Item 5.  | Market for Registrant's Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities | 18 |
| Item 6.  | Selected Financial Data | 20 |
| Item 7.  | Management's Discussion and Analysis of Financial Condition and Results of Operations | 21 |
| Item 7A. | Quantitative and Qualitative Disclosures About Market Risk | 43 |
| Item 8.  | Financial Statements and Supplementary Data | 44 |
| Item 9.  | Changes in and Disagreements with Accountants on Accounting and Financial Disclosure | 79 |
| Item 9A. | Controls and Procedures | 79 |
| Item 9B. | Other Information | 79 |
|          |   |   |
|          | Part III |   |
|          |   |   |
| Item 10. | Directors, Executive Officers and Corporate Governance | 80 |
| Item 11. | Executive Compensation | 80 |
| Item 12. | Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters | 80 |
| Item 13. | Certain Relationships and Related Transactions, and Director Independence | 81 |
| Item 14. | Principal Accounting Fees and Services | 81 |
|          |   |   |
|          | Part IV |   |
|          |   |   |
| Item 15. | Exhibits, Financial Statement Schedules | 82 |

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|         |                                                                         |
|---------|-------------------------------------------------------------------------|
| • | Drilling and Evaluation products and services consist of the following: |

|         |                                                                                                                                                                         |
|---------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| • | Drill Bits - includes Tricone™, PDC or “diamond”, and Kymera™ hybrid drill bits used for performance drilling, hole enlargement and coring. |

|         |                                                                                                                                                                                                                                                                                                                                                                                         |
|---------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| • | Drilling Services - includes conventional and rotary steerable systems used to drill wells directionally and horizontally; measurement-while-drilling and logging-while-drilling systems used to perform reservoir navigation services; drilling optimization services; tools for coil tubing drilling and wellbore re-entry systems; coring drilling systems; and surface logging. |

|         |                                                                                                                                                                                                                                                                                                                                         |
|---------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| • | Wireline Services - includes tools for both open hole and cased hole well logging used to gather data to perform petrophysical and geophysical analysis; reservoir evaluation coring; casing perforation; fluid characterization; production logging; well integrity testing; pipe recovery; and seismic and microseismic services. |

|         |                                                                                                                                                               |
|---------|---------------------------------------------------------------------------------------------------------------------------------------------------------------|
| • | Drilling and Completion Fluids - includes emulsion and water-based drilling fluids systems; reservoir drill-in fluids; and fluids environmental services. |

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|         |                                                                           |
|---------|---------------------------------------------------------------------------|
| • | Completion and Production products and services consist of the following: |

|         |                                                                                                                                                                                                                                                                                                      |
|---------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| • | Completion Systems - includes products and services used to control the flow of hydrocarbons within a wellbore including sand control systems; liner hangers; wellbore isolation; expandable tubulars; multilaterals; safety systems; packers and flow control; and tubing conveyed perforating. |

|         |                                                                                                                                                                                                                                                                                                           |
|---------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| • | Wellbore Intervention - includes products and services used in existing wellbores to improve their performance including thru-tubing fishing; thru-tubing inflatables; conventional fishing; casing exit systems; production injection packers; remedial and stimulation tools; and wellbore cleanup. |

|         |                                                                                                                                                                                                                                                                                                                      |
|---------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| • | Intelligent Production Systems - includes products and services used to monitor and dynamically control the production from individual wells or fields including production decisions services; chemical injection services; well monitoring services; intelligent well systems; and artificial lift monitoring. |

|         |                                                                                                                                                                                                                                                                |
|---------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| • | Artificial Lift - includes electric submersible pump systems; progressing cavity pump systems; gas lift systems; and surface horizontal pumping systems used to lift large volumes of oil and water when a reservoir is no longer able to flow on its own. |

|         |                                                                                                                                                                                             |
|---------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| • | Upstream Chemicals - includes chemicals and chemical application systems to provide flow assurance, integrity management and production management for upstream hydrocarbon production. |

|         |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               |
|---------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| • | Pressure Pumping - includes cementing, stimulation, including hydraulic fracturing, and coil tubing services used in the completion of new oil and natural gas wells and in remedial work on existing wells, both onshore and offshore.  Hydraulic fracturing is the practice of pumping fluid through a wellbore at pressures and rates sufficient to crack rock in the target formation, extend the cracks, and leave behind a propping agent to keep the cracks open after pumping ceases.  The purpose of the cracks is to provide a pathway that allows for the passage of hydrocarbons from the rock to the wellbore, thus improving the production of hydrocarbons to the surface. |

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|         |                                                                                                                                                                                                                                                                                                                                                                      |
|---------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| • | The severity and duration of both the summer and the winter in North America can have a significant impact on activity levels.  In Canada, the timing and duration of the spring thaw directly affects activity levels, which reach seasonal lows during the second quarter and build through the third and fourth quarters to a seasonal high in the first quarter. |

|         |                                                                                              |
|---------|----------------------------------------------------------------------------------------------|
| • | Hurricanes and typhoons can disrupt coastal and offshore drilling and production operations. |

|         |                                                                                                                                                 |
|---------|-------------------------------------------------------------------------------------------------------------------------------------------------|
| • | Severe weather during the winter months normally results in reduced activity levels in the North Sea and Russia generally in the first quarter. |

|         |                                                                                                                                |
|---------|--------------------------------------------------------------------------------------------------------------------------------|
| • | Scheduled repair and maintenance of offshore facilities in the North Sea can reduce activity in the second and third quarters. |

|         |                                                                                                                       |
|---------|-----------------------------------------------------------------------------------------------------------------------|
| • | Many of our international oilfield customers increase orders for certain products and services in the fourth quarter. |

|         |                                                                                                                                                           |
|---------|-----------------------------------------------------------------------------------------------------------------------------------------------------------|
| • | Our Industrial Services segment typically experiences lower sales during the first and fourth quarters of the year due to the Northern Hemisphere winter. |

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|                               |
|-------------------------------|
|                               |  |  |  |  |  |
| Name                          |   | Age |  |   |   |
| Martin S. Craighead |   | 54 |  |   | 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. Group President of Drilling and Evaluation from 2007 to 2009 and Vice President of the Company from 2005 until 2009.  President of INTEQ from 2005 to 2007.  President of Baker Atlas from February 2005 to August 2005.  Employed by the Company in 1986. |
| Peter A. Ragauss              |   | 56 |  |   | Senior Vice President and Chief Financial Officer of the Company since 2006.  Segment Controller of Refining and Marketing for BP plc from 2003 to 2006.  Mr. Ragauss joined BP plc in 1998 as Assistant to the Group Chief Executive until 2000 when he became Chief Executive Officer of Air BP.  Vice President of Finance and Portfolio Management for Amoco Energy International immediately prior to its merger with BP in 1998.  Vice President of Finance for El Paso Energy International from 1996 to 1998.  Employed by the Company in 2006.  Mr. Ragauss has announced he will retire by December 31, 2014. |
| Maria Borras                  |   | 45 |  |   | President, Latin America Region of the Company since October 2013.  President, Europe Region from August 2011 to October 2013 and Vice President, Global Marketing from May 2009 to July 2011.  Various positions within operations, product line management, and leadership roles from March 1994 to April 2009.  Petroleum Engineer at Petrobras, Occidental de Colombia from 1990 to 1994.  Employed by the Company in 1994. |
| Belgacem Chariag         |   | 51 |  |   | President, Global Products and Services since October 2013 and Vice President of the Company since 2009.  President, Eastern Hemisphere Operations from 2009 to 2013.  Vice President/Director HSE of Schlumberger Limited from May 2008 to May 2009.  President of Well Services, a Schlumberger product line, from 2006 to 2008.  Vice President Strategic Marketing Oilfield Services for Europe, Africa and CIS of Schlumberger from 2004 to 2006.  Various other positions at Schlumberger from 1989 to 2008.  Employed by the Company in 2009. |
| Didier Charreton              |   | 50 |  |   | Vice President, Human Resources of the Company since 2007.  Group Human Resources Director of Coats Plc, a global company engaged in the sewing thread and needlecrafts industry, from 2002 to 2007.  Business Development of ID Applications for Gemplus S.A., a global company in the Smart Card industry, from 2000 to 2001.  Various human resources positions at Schlumberger from 1989 to 2000.  Employed by the Company in 2007. |
| Alan R. Crain                 |   | 62 |  |   | Senior Vice President, Chief Legal and Governance Officer of the Company since 2013.  Senior Vice President and General Counsel of the Company from 2007 to 2013.  Vice President and General Counsel from 2000 to 2007.  Executive Vice President, General Counsel and Secretary of Crown, Cork & Seal Company, Inc. from 1999 to 2000.  Vice President and General Counsel from 1996 to 1999, and Assistant General Counsel from 1988 to 1996, of Union Texas Petroleum Holdings, Inc.  Employed by the Company in 2000. |
| Archana Deskus                |   | 48 |  |   | Vice President and Chief Information Officer of the Company since 2013.  Vice President and Chief Information Officer for Ingersoll-Rand from 2011 to 2012.  Senior Vice President and Chief Information Officer for Timex Group from 2007 to 2011.  Vice President and Chief Information Officer for Carrier North America from 2003 to 2006.  Employed by the Company in 2013. |
| Alan J. Keifer                |   | 59 |  |   | Vice President and Controller of the Company since 1999.  Western Hemisphere Controller of Baker Oil Tools from 1997 to 1999 and Director of Corporate Audit for the Company from 1990 to 1996.  Employed by the Company in 1990. |

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|                     |
|---------------------|
|                     |  |  |  |  |  |
| Dmitry Kuzovenkov   |   | 41 |  |   | Vice President, Health, Safety and Environment of the Company since May 2013.  President, Russia and Caspian Region from 2009 to 2013.  Vice President, Drilling and Evaluation from 2008 to 2009 and Director Sales and Business Development from 2007 to 2008.  Various positions with Schlumberger from 1995 to 2007 including Technology Manager for Schlumberger Wireline from 2005 to 2007, Operations Manager Pressure Pumping for East Mediterranean Geomarket from 2004 to 2005 and Operations Manager Pressure Pumping for South Texas from 2002 to 2004.  Employed by the Company in 2007. |
| William D. Marsh    |   | 51 |  |   | Vice President and General Counsel of the Company since February 2013.  Vice President-Legal for Western Hemisphere from May 2009 to February 2013.  Various executive, legal and corporate roles within the Company from 1998 to 2009.  Partner at Ballard Spahr LLP from 1997 to 1998.  Employed by the Company in 1998. |
| Jay G. Martin       |   | 62 |  |   | Vice President, Chief Compliance Officer and Senior Deputy General Counsel of the Company since 2004.  Shareholder at Winstead Sechrest & Minick P.C. from 2001 to 2004.  Partner, Phelps Dunbar from 2000 to 2001.  Partner, Andrews & Kurth from 1996 to 2000.  Employed by the Company in 2004. |
| Derek Mathieson     |   | 43 |  |   | Vice President, Strategy and Corporate Development of the Company since October 2013.  Vice President of the Company since December 2008 and President Western Hemisphere Operations from 2012 to 2013.  President, Products and Technology from May 2009 to January 2012.  Chief Technology and Marketing Officer of the Company from December 2008 to May 2009.  Chief Executive Officer of WellDynamics, Inc. from May 2007 to November 2008.  Vice President Business Development, Technology and Marketing of WellDynamics, Inc. from April 2006 to May 2007.  Technology Director and Chief Technology Officer from January 2004 to April 2006.  Employed by the Company in 2008. |
| Khaled Nouh         |   | 46 |  |   | President, Middle East and Asia Pacific Region of the Company since October 2013.  President, Middle East Region from 2009 to 2013.  Vice President Integrated Project Management Middle East at Schlumberger from 2008 to 2009.  Vice President Operations for Saudi Arabia-Kuwait-Bahrain and Pakistan Region at Schlumberger from 2004 to 2008.  Vice President Libya Operations at Schlumberger from 2003 to 2004.  Various other vice president, engineering and management positions at Schlumberger from 1994 to 2003.  Employed by the Company in 2009. |
| Mario Ruscev        |   | 57 |  |   | Vice President and Chief Technology Officer of the Company since August 2012.  Chief Executive Officer of Geotech Seismic Services from January 2012 to August 2012.  Chief Executive Officer of FormFactor from 2008 to 2010.  Various positions at Schlumberger for 20 years.  Employed by the Company in 2012. |
| Arthur L. Soucy     |   | 51 |  |   | President, Europe, Africa and Russia Caspian Region of the Company since 2013.  Vice President of the Company since April 2009 and President Global Products and Services from 2012 to 2013.  Vice President Supply Chain of the Company from April 2009 to January 2012.  Vice President, Global Supply Chain for Pratt and Whitney from 2007 to 2009.  Sloan Fellows Program, Innovation and Global Leadership at Massachusetts Institute of Technology from 2006 to 2007.  General Manager, Combustors, Augmenters and Nozzles of Pratt and Whitney from 2005 to 2006.  Various managerial positions at Pratt and Whitney from 1995 to 2006.  Employed by the Company in 2009. |
| Richard L. Williams |   | 58 |  |   | President, North America Region of the Company since October 2013.  President, U.S. Region from November 2012 to October 2013 and President, Gulf of Mexico Region from 2009 to 2012.  Various positions within the Company from 1975 to 2009 including President of Baker Hughes Drilling Fluids, Vice President of Global Operations for INTEQ, Vice President of Western Hemisphere Operations and Vice President of North America Operations for Baker Oil Tools.  Employed by the Company in 1975. |

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|         |                                                                                      |
|---------|--------------------------------------------------------------------------------------|
| • | we may not be able to continue to obtain insurance on commercially reasonable terms; |

|         |                                                                                      |
|---------|--------------------------------------------------------------------------------------|
| • | we may be faced with types of liabilities that will not be covered by our insurance; |

|         |                                                                                         |
|---------|-----------------------------------------------------------------------------------------|
| • | our insurance carriers may not be able to meet their obligations under the policies; or |

|         |                                                                    |
|---------|--------------------------------------------------------------------|
| • | the dollar amount of any liabilities may exceed our policy limits. |

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|                               |
|-------------------------------|
|                               |  |  |
| North America:                |   | Houston, Pasadena, Tomball, and The Woodlands, Texas; Broken Arrow, Claremore, Tulsa and Sand Springs, Oklahoma; Bossier City, Broussard, and Lafayette, Louisiana - all located in the United States; Leduc, Canada |
| Latin America:                |   | Maracaibo, Venezuela; Macaé (Rio de Janeiro), Brazil |
| Europe/Africa/Russia Caspian: |   | Aberdeen, Scotland; Liverpool, England; Celle, Germany; Tananger, Norway; Port Harcourt, Nigeria; Tyumen, Russia |
| Middle East/Asia Pacific:     |   | Dubai, United Arab Emirates; Dhahran, Saudi Arabia; Singapore, Singapore; Chonburi, Thailand |

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|                               |
|-------------------------------|
|                               |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
| Period                        | Numberof SharesPurchased (1) |   | AveragePrice PaidPer Share (1) |   | Number ofSharesPurchasedas Part of aPubliclyAnnouncedProgram (2) |   | AveragePrice PaidPer Share (3) |   | TotalNumber ofSharesPurchasedin theAggregate |   | MaximumNumber (orApproximateDollar Value) of Shares that May Yet BePurchased Under the Program (4) |
| October 1-31, 2013  | 2,860 |  |   | $ | 55.67 |  |   | — |  |   | $ | — |  |   | 2,860 |  |   | $ | — |  |
| November 1-30, 2013 | 101 |  |   | 56.73 |  |   | 2,877,310 |  |   | 57.34 |  |   | 2,877,411 |  |   | — |  |
| December 1-31, 2013 | — |  |   | — |  |   | 3,422,161 |  |   | 54.12 |  |   | 3,422,161 |  |   | — |  |
| Total                         | 2,961 |  |   | $ | 55.70 |  |   | 6,299,471 |  |   | $ | 55.59 |  |   | 6,302,432 |  |   | $ | 1,649,956,974 |  |

|           |                                                                                                                                                                             |
|-----------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| (1)  | Represents shares purchased from employees to satisfy the tax withholding obligations in connection with the vesting of restricted stock awards and restricted stock units. |

|           |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  |
|-----------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| (2)  | Repurchases were made under our previously announced purchase program, including under a Letter Agreement with an agent that complied with the requirements of Rule 10b-18 of the Exchange Act (the “Agreement”).  Shares were repurchased under the Agreement by the agent at the prevailing market prices, in open market transactions.  Additionally, on December 10, 2013, we entered into a Purchase Plan that complied with Rule 10b5-1 of the Exchange Act (the "10b5-1 Plan").  Under the 10b5-1 Plan, the agent repurchased a number of shares of our common stock determined under the terms of the 10b5-1 Plan each trading day based on the trading price of the stock on that day. |

|           |                                          |
|-----------|------------------------------------------|
| (3)  | Average price paid includes commissions. |

|           |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       |
|-----------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| (4)  | During 2013, our Board of Directors increased the authorization to purchase our common stock under our previously announced program by $800 million.  During the fourth quarter of 2013, we repurchased 6.3 million shares of our common stock at an average price of $55.59 per share (including commissions), for a total of $350 million.  We had authorization remaining to repurchase up to a total of $1.65 billion of our common stock as of the end of 2013. |

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|                                                      |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
|                                                 | 2008 |   | 2009 |   | 2010 |   | 2011 |   | 2012 |   | 2013 |
| Baker Hughes                                         | $ | 100.00 |  |   | $ | 128.33 |  |   | $ | 183.60 |  |   | $ | 157.85 |  |   | $ | 134.45 |  |   | $ | 184.13 |  |
| S&P 500 Index                                    | 100.00 |  |   | 126.37 |  |   | 145.36 |  |   | 148.45 |  |   | 172.10 |  |   | 227.72 |  |
| S&P 500 Oil and Gas Equipment and Services Index | 100.00 |  |   | 159.80 |  |   | 222.47 |  |   | 196.63 |  |   | 196.69 |  |   | 256.96 |  |

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|                                                            |
|------------------------------------------------------------|
|                                                            |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
|                                                       | Year Ended December 31, |
| (In millions, except per share amounts)                    | 2013 (1) |  |   | 2012 (1) |  |   | 2011 (1) |  |   | 2010 (1) |  |   | 2009 |
| Revenue                                                    | $ | 22,364 |  |   | $ | 21,361 |  |   | $ | 19,831 |  |   | $ | 14,414 |  |   | $ | 9,664 |  |
| Operating income (2)                                       | 1,949 |  |   | 2,192 |  |   | 2,600 |  |   | 1,417 |  |   | 732 |  |
| Non-operating expense, net                                 | (234 | ) |   | (210 | ) |   | (261 | ) |   | (135 | ) |   | (121 | ) |
| Income before income taxes                                 | 1,715 |  |   | 1,982 |  |   | 2,339 |  |   | 1,282 |  |   | 611 |  |
| Income taxes (3)                                           | (612 | ) |   | (665 | ) |   | (596 | ) |   | (463 | ) |   | (190 | ) |
| Net income                                                 | 1,103 |  |   | 1,317 |  |   | 1,743 |  |   | 819 |  |   | 421 |  |
| Net (income) loss attributable to noncontrolling interests | (7 | ) |   | (6 | ) |   | (4 | ) |   | (7 | ) |   | — |  |
| Net income attributable to Baker Hughes                    | $ | 1,096 |  |   | $ | 1,311 |  |   | $ | 1,739 |  |   | $ | 812 |  |   | $ | 421 |  |
| Per share of common stock:                                 |   |   |   |   |   |   |   |   |   |
| Net income attributable to Baker Hughes:                   |   |   |   |   |   |   |   |   |   |
| Basic                                                      | $ | 2.47 |  |   | $ | 2.98 |  |   | $ | 3.99 |  |   | $ | 2.06 |  |   | $ | 1.36 |  |
| Diluted                                                    | 2.47 |  |   | 2.97 |  |   | 3.97 |  |   | 2.06 |  |   | 1.36 |  |
| Dividends                                                  | 0.60 |  |   | 0.60 |  |   | 0.60 |  |   | 0.60 |  |   | 0.60 |  |
| Balance Sheet Data:                                        |   |   |   |   |   |   |   |   |   |
| Cash, cash equivalents and short-term investments          | $ | 1,399 |  |   | $ | 1,015 |  |   | $ | 1,050 |  |   | $ | 1,706 |  |   | $ | 1,595 |  |
| Working capital (current assets minus current liabilities) | 6,717 |  |   | 6,293 |  |   | 6,295 |  |   | 5,568 |  |   | 4,612 |  |
| Total assets                                               | 27,934 |  |   | 26,689 |  |   | 24,847 |  |   | 22,986 |  |   | 11,439 |  |
| Long-term debt                                             | 3,882 |  |   | 3,837 |  |   | 3,845 |  |   | 3,554 |  |   | 1,785 |  |
| Total equity                                               | 17,912 |  |   | 17,268 |  |   | 15,964 |  |   | 14,286 |  |   | 7,284 |  |

|           |                                                                                                                                                                          |
|-----------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| (1)  | We acquired BJ Services Company ("BJ Services") on April 28, 2010, and accordingly, the financial results of BJ Services are included only from the date of acquisition. |

|           |                                                                                                                                                                                                                                                                                                                                           |
|-----------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| (2)  | Operating income for 2011 includes a charge of $315 million before-tax ($220 million net of tax), the majority of which relates to the impairment associated with the decision to minimize the use of the BJ Services trade name.  For further discussion, see Note 7 of the Notes to Consolidated Financial Statements in Item 8 herein. |

|           |                                                                                                                                                                                                                                         |
|-----------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| (3)  | Income taxes for 2011 include a tax benefit of $214 million associated with the reorganization of certain foreign subsidiaries.  For further discussion, see Note 3 of the Notes to Consolidated Financial Statements in Item 8 herein. |

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|----------------------------------|
|                                  |  |  |  |  |  |  |  |  |  |  |  |
|                             | 2013 |   | 2012 |   | 2011 |
| Brent oil prices ($/Bbl) (1)     | $ | 108.81 |  |   | $ | 111.96 |  |   | $ | 111.05 |  |
| WTI oil prices ($/Bbl) (2)       | 97.98 |  |   | 94.12 |  |   | 95.08 |  |
| Natural gas prices ($/mmBtu) (3) | 3.73 |  |   | 2.76 |  |   | 3.99 |  |

|           |                                                                       |
|-----------|-----------------------------------------------------------------------|
| (1)  | Bloomberg Dated Brent (“Brent”) Oil Spot Price per Barrel |

|           |                                                                                               |
|-----------|-----------------------------------------------------------------------------------------------|
| (2)  | Bloomberg West Texas Intermediate (“WTI”) Cushing Crude Oil Spot Price per Barrel |

|           |                                                                             |
|-----------|-----------------------------------------------------------------------------|
| (3)  | Bloomberg Henry Hub Natural Gas Spot Price per million British Thermal Unit |

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|                       |
|-----------------------|
|                       |  |  |  |  |  |  |  |  |
|                  | 2013 |   | 2012 |   | 2011 |
| U.S. - onshore        | 1,705 |  |   | 1,871 |  |   | 1,846 |  |
| U.S. - offshore       | 56 |  |   | 47 |  |   | 32 |  |
| Canada                | 353 |  |   | 364 |  |   | 418 |  |
| North America         | 2,114 |  |   | 2,282 |  |   | 2,296 |  |
| Latin America         | 419 |  |   | 423 |  |   | 424 |  |
| North Sea             | 42 |  |   | 40 |  |   | 38 |  |
| Continental Europe    | 93 |  |   | 79 |  |   | 80 |  |
| Africa                | 125 |  |   | 96 |  |   | 78 |  |
| Middle East           | 372 |  |   | 356 |  |   | 291 |  |
| Asia Pacific          | 246 |  |   | 241 |  |   | 256 |  |
| Outside North America | 1,297 |  |   | 1,235 |  |   | 1,167 |  |
| Worldwide             | 3,411 |  |   | 3,517 |  |   | 3,463 |  |

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|-----------------------------------|
|                                   |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
|                              | Year Ended December 31, |   |   |
|                         | 2013 |   | 2012 |   | $ Change |   | % Change |
| Revenue:                          |   |   |   |   |   |   |   |
| North America                     | $ | 10,878 |  |   | $ | 10,836 |  |   | $ | 42 |  |   | — |  % |
| Latin America                     | 2,307 |  |   | 2,399 |  |   | (92 | ) |   | (4 | )% |
| Europe/Africa/Russia Caspian | 3,850 |  |   | 3,634 |  |   | 216 |  |   | 6 |  % |
| Middle East/Asia Pacific          | 4,050 |  |   | 3,275 |  |   | 775 |  |   | 24 |  % |
| Industrial Services               | 1,279 |  |   | 1,217 |  |   | 62 |  |   | 5 |  % |
| Total Revenue                     | $ | 22,364 |  |   | $ | 21,361 |  |   | $ | 1,003 |  |   | 5 |  % |

|                              |
|------------------------------|
|                              |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
|                         | Year Ended December 31, |   |   |   |   |
|                         | 2013 |   | 2012 |   | $ Change |   | % Change |
| Profit Before Tax:           |   |   |   |   |   |   |   |
| North America                | $ | 968 |  |   | $ | 1,268 |  |   | $ | (300 | ) |   | (24 | )% |
| Latin America                | 66 |  |   | 197 |  |   | (131 | ) |   | (66 | )% |
| Europe/Africa/Russia Caspian | 570 |  |   | 586 |  |   | (16 | ) |   | (3 | )% |
| Middle East/Asia Pacific     | 478 |  |   | 313 |  |   | 165 |  |   | 53 |  % |
| Industrial Services          | 135 |  |   | 131 |  |   | 4 |  |   | 3 |  % |
| Total Operations             | 2,217 |  |   | 2,495 |  |   | (278 | ) |   | (11 | )% |
| Corporate and other          | (502 | ) |   | (513 | ) |   | 11 |  |   | (2 | )% |
| Total Profit Before Tax      | $ | 1,715 |  |   | $ | 1,982 |  |   | $ | (267 | ) |   | (13 | )% |

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|                                   |
|-----------------------------------|
|                                   |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
|                              | Year Ended December 31, |   |   |
|                         | 2012 |   | 2011 |   | $ Change |   | % Change |
| Revenue:                          |   |   |   |   |   |   |   |
| North America                     | $ | 10,836 |  |   | $ | 10,279 |  |   | $ | 557 |  |   | 5 | % |
| Latin America                     | 2,399 |  |   | 2,190 |  |   | 209 |  |   | 10 | % |
| Europe/Africa/Russia Caspian | 3,634 |  |   | 3,372 |  |   | 262 |  |   | 8 | % |
| Middle East/Asia Pacific          | 3,275 |  |   | 2,852 |  |   | 423 |  |   | 15 | % |
| Industrial Services               | 1,217 |  |   | 1,138 |  |   | 79 |  |   | 7 | % |
| Total Revenue                     | $ | 21,361 |  |   | $ | 19,831 |  |   | $ | 1,530 |  |   | 8 | % |

|                              |
|------------------------------|
|                              |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
|                         | Year Ended December 31, |   |   |   |   |
|                    | 2012 |   | 2011 |   | $ Change |   | % Change |
| Profit Before Tax:           |   |   |   |   |   |   |   |
| North America                | $ | 1,268 |  |   | $ | 1,908 |  |   | $ | (640 | ) |   | (34 | )% |
| Latin America                | 197 |  |   | 223 |  |   | (26 | ) |   | (12 | )% |
| Europe/Africa/Russia Caspian | 586 |  |   | 336 |  |   | 250 |  |   | 74 |  % |
| Middle East/Asia Pacific     | 313 |  |   | 310 |  |   | 3 |  |   | 1 |  % |
| Industrial Services          | 131 |  |   | 95 |  |   | 36 |  |   | 38 |  % |
| Total Operations             | 2,495 |  |   | 2,872 |  |   | (377 | ) |   | (13 | )% |
| Corporate and other          | (513 | ) |   | (533 | ) |   | 20 |  |   | (4 | )% |
| Total Profit Before Tax      | $ | 1,982 |  |   | $ | 2,339 |  |   | $ | (357 | ) |   | (15 | )% |

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|                                       |
|---------------------------------------|
|                                       |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
|                                  | 2013 |   | 2012 |   | 2011 |
|                             | $ |   | % |   | $ |   | % |   | $ |   | % |
| Revenue                               | $ | 22,364 |  |   | 100 | % |   | $ | 21,361 |  |   | 100 | % |   | $ | 19,831 |  |   | 100 | % |
| Cost of revenue                       | 18,553 |  |   | 83 | % |   | 17,356 |  |   | 81 | % |   | 15,264 |  |   | 77 | % |
| Research and engineering              | 556 |  |   | 2 | % |   | 497 |  |   | 2 | % |   | 462 |  |   | 2 | % |
| Marketing, general and administrative | 1,306 |  |   | 6 | % |   | 1,316 |  |   | 6 | % |   | 1,190 |  |   | 6 | % |

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|         |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              |
|---------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| • | Worldwide Economic Growth - In general, there is a strong correlation between overall economic growth and global demand for hydrocarbons.  The economic outlook for 2014 includes strengthened economic activity but also heightened risks:  European countries face concerns over rising sovereign debt levels, China's economy is experiencing a slowdown in growth, and the U.S. continues its moderate pace of recovery.  The sovereign debt crisis in Europe has affected the economies of major commodities exporters, |

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|         |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            |
|---------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| • | Demand for Hydrocarbons - In its January 2014 Oil Market Report, the IEA forecasted global demand for oil to increase by 1.3 million barrels per day (“bpd”) in 2014, reaching 92.5 million bpd.  This expected increase, mainly driven by countries outside the OECD, should support upstream investment in oil and natural gas production around the world.  In addition to the global growth in oil demand, natural gas will continue to play an increasingly important role in meeting the world’s energy needs.  In its January 2014 Short-Term Energy Outlook, the EIA estimated that industrial demand for natural gas in the U.S. will increase by 0.2 billion cubic feet per day (“bcfd”) in 2014, reaching 20.6 bcfd.  Overall U.S. natural gas demand is expected to decline by 1.6 bcfd to 69.6 bcfd in 2014 due to lower electric power sector demand and lower heating demand. |

|         |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             |
|---------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| • | Oil Production - The January 2014 IEA Oil Market Report projected non-OPEC production to grow by 1.7 million bpd in 2014.  This increase is largely due to continued production growth from U.S. tight oil formations and Canadian oil sands, fostered by sustained higher oil prices.  OPEC’s own production target has been unchanged from 30 million bpd, with slight changes possible if there is substantial movement in the oil price.  Significant investments are expected to be required to increase production capacity, especially as output from mature fields decline and production rates from early wells at unconventional deposits continue to drop. |

|         |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          |
|---------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| • | Natural Gas Production - Natural gas production continues to grow worldwide, including in North America where drilling activity has slowed.  Despite U.S. natural gas-directed rig counts reaching 18-year lows in recent months, averaging 383 rigs for 2013 which is down from 556 rigs in 2012, natural gas production in the U.S. has increased.  In its January 2014 Short-Term Energy Outlook, the EIA estimated that U.S. natural gas production will increase by 2.1% in 2014, from 70.2 bcfd to 71.7 bcfd.  Overall, global natural gas output will tend to up in 2014 due to the increased production in the U.S., as well as in the Eastern Hemisphere as high natural gas prices in Europe and Asia should encourage growth. |

|         |                                                                                                                                                                                                                                                                                                                                                                                                                                                      |
|---------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| • | Oil Prices - With WTI oil prices trading between $86.68/Bbl and $110.53/Bbl, and Brent trading between $96.79/Bbl and $119.34/Bbl during 2013, most global oil activity will continue to provide adequate returns to encourage incremental investment.  Based on oil supply forecasts and modest anticipated economic growth globally, oil prices are expected to remain relatively stable throughout 2014, barring any major macroeconomic changes. |

|         |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              |
|---------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| • | Natural Gas Prices - With Henry Hub natural gas prices trading between $3.08/mmBtu and $4.52/mmBtu during 2013, and the EIA projecting in its January 2014 Short-term Energy Outlook an average of $3.89/mmBtu in 2014, the economics of most dry natural gas-directed investments in North America will likely continue to be marginal.  This is primarily due to the abundant supplies from unconventional plays in North America, including associated gas produced at liquids-rich unconventional plays. |

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|         |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            |
|---------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| • | We have comprehensive internal policies over such areas as facilitating payments; travel, entertainment, gifts and charitable donations connected to non-U.S. government officials; payments to non-U.S. commercial sales representatives; and the use of non-U.S. police or military organizations for security purposes.  In addition, we have country-specific guidance for customs standards, visa processing, export and re-export controls, economic sanctions and antiboycott laws. |

|         |                                                                                                    |
|---------|----------------------------------------------------------------------------------------------------|
| • | We have a comprehensive employee compliance training program covering substantially all employees. |

|         |                                                                                                                                                  |
|---------|--------------------------------------------------------------------------------------------------------------------------------------------------|
| • | We have a due diligence procedure for commercial sales, processing and professional agents and an enhanced process for classifying distributors. |

|         |                                                                                                                                                                                                   |
|---------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| • | We have a special compliance committee, which is made up of senior officers, that meets no less than once a year to review the oversight reports for all active commercial sales representatives. |

|         |                                                                                                                                                  |
|---------|--------------------------------------------------------------------------------------------------------------------------------------------------|
| • | We have continued our reduction of the use of commercial sales representatives and processing agents, including the reduction of customs agents. |

|         |                                                                                                                                                              |
|---------|--------------------------------------------------------------------------------------------------------------------------------------------------------------|
| • | We use technology to monitor and report on compliance matters, including a web-based antiboycott reporting tool and a global trade management software tool. |

|         |                                                                                                                                                                                                                                                                                                                            |
|---------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| • | We have a program designed to encourage reporting of any ethics or compliance matter without fear of retaliation including a worldwide Business Helpline operated by a third party and currently available toll-free in 150 languages to ensure that our helpline is easily accessible to employees in their own language. |

|         |                                                                                                                                                                                                                                                                                                                |
|---------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| • | We have a centralized finance organization including an enterprise-wide accounting system and company-wide policies.  In addition, the corporate audit function has incorporated anti-corruption procedures in audits of certain countries.  We also conduct FCPA risk assessments and legal audit procedures. |

|         |                                                                                                                                                                                                                                |
|---------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| • | We continue to work to ensure that we have adequate legal compliance coverage around the world, including the coordination of compliance advice and customized training across all regions and countries where we do business. |

|         |                                                                                                                                                                                                                                                                                                 |
|---------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| • | We have a centralized human resources function, including consistent standards for pre-hire screening of employees, the screening of existing employees prior to promoting them to positions where they may be exposed to corruption-related risks, and a uniform policy for new hire training. |

|                      |
|----------------------|
|                      |  |  |  |  |  |  |  |  |  |  |  |
| (In millions)        | 2013 |   | 2012 |   | 2011 |
| Operating activities | $ | 3,161 |  |   | $ | 1,835 |  |   | $ | 1,507 |  |
| Investing activities | (1,663 | ) |   | (2,521 | ) |   | (1,891 | ) |
| Financing activities | (1,103 | ) |   | 646 |  |   | (30 | ) |

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|         |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          |
|---------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| • | An increase in accounts receivable used cash of $453 million and provided cash of $16 million in 2013 and 2012, respectively.  The increase in accounts receivable in 2013 was primarily due to an increase in activity and the corresponding revenue growth partially offset by improved collections as evidenced by a decrease in days sales outstanding (defined as the average number of days our net trade receivables are outstanding based on quarterly revenue). |

|         |                                                                                                                                                                                                              |
|---------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| • | An increase in inventory used cash of $120 million and $547 million in 2013 and 2012, respectively, driven by an increase in activity levels partially offset by improved inventory utilization. |

|         |                                                                                                                                                                                                                                                                                                     |
|---------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| • | An increase in accounts payable provided $845 million in cash in 2013 and used cash of $94 million in 2012.  This increase in accounts payable was primarily due to increased activity and an improvement in our days payable outstanding resulting from vendor management initiatives. |

|         |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          |
|---------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| • | Accrued employee compensation and other accrued liabilities provided cash of $231 million and used cash of $90 million in 2013 and 2012, respectively.  The increase in cash provided in 2013 was primarily due to the change in accrued employee compensation driven by an increase in employee bonus accruals for 2013 compared to 2012 coupled with lower payments for employee bonuses in 2013 compared to 2012.  Additionally, the cash improvement for other accrued liabilities resulted from advanced customer payments. |

|         |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      |
|---------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| • | The change in accounts receivable provided cash of $16 million and used cash of $1.02 billion in 2012 and 2011, respectively.  The slight change in accounts receivable in 2012 was primarily due to improved collections over the prior year partially offset by an increase in activity.  The change in accounts receivable in 2011 was primarily due to an increase in activity as well as an increase in days sales outstanding due to temporary invoicing delays resulting from the implementation of our enterprise wide software system for BJ Services in North America. |

|         |                                                                                                                                                    |
|---------|----------------------------------------------------------------------------------------------------------------------------------------------------|
| • | An increase in inventory used cash of $547 million and $641 million in 2012 and 2011, respectively, driven by an increase in activity. |

|         |                                                                                                                                                                                                                                                                                                                                                                                   |
|---------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| • | Accrued employee compensation and other accrued liabilities used cash of $90 million and provided cash of $58 million in 2012 and 2011, respectively.  The net change of $148 million was primarily due to an increase in payments related to employee bonuses earned in 2011 but paid in 2012 coupled with lower employee compensation accruals in 2012. |

|         |                                                                                                                                                                                                                              |
|---------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| • | Income taxes payable used cash of $56 million and $121 million in 2012 and 2011, respectively.  The change of $65 million was primarily due to a decrease in income taxes paid in 2012 compared to 2011. |

|         |                                                                                                                      |
|---------|----------------------------------------------------------------------------------------------------------------------|
| • | Other operating items used cash of $213 million and $19 million in 2012 and 2011, respectively.  The net |

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|                                                             |
|-------------------------------------------------------------|
|                                                             |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
|                                                        | Payments Due by Period |
| (In millions)                                               | Total |   | Less Than1 Year |   | 2 - 3Years |   | 4 - 5Years |   | More Than5 Years |
| Total debt and capital lease obligations (1)                | $ | 4,410 |  |   | $ | 499 |  |   | $ | 39 |  |   | $ | 1,024 |  |   | $ | 2,848 |  |
| Estimated interest payments (2)                             | 3,273 |  |   | 232 |  |   | 455 |  |   | 438 |  |   | 2,148 |  |
| Operating leases (3)                                        | 1,049 |  |   | 405 |  |   | 408 |  |   | 114 |  |   | 122 |  |
| Purchase obligations (4)                                    | 1,672 |  |   | 483 |  |   | 678 |  |   | 343 |  |   | 168 |  |
| Income tax liabilities for uncertain tax positions (5) | 282 |  |   | 119 |  |   | 108 |  |   | 18 |  |   | 37 |  |
| Other long-term liabilities                                 | 194 |  |   | 54 |  |   | 69 |  |   | 11 |  |   | 60 |  |
| Total (6)                                                   | $ | 10,880 |  |   | $ | 1,792 |  |   | $ | 1,757 |  |   | $ | 1,948 |  |   | $ | 5,383 |  |

|           |                                                                                                                                                                                                                                                                                                                                                 |
|-----------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| (1)  | Amounts represent the expected cash payments for the principal amounts related to our debt, including outstanding commercial paper of $254 million, and capital lease obligations.  Amounts for debt do not include any unamortized discounts or deferred issuance costs.  Expected cash payments for interest are excluded from these amounts. |

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|           |                                                                                                                |
|-----------|----------------------------------------------------------------------------------------------------------------|
| (2)  | Amounts represent the expected cash payments for interest on our long-term debt and capital lease obligations. |

|           |                                                                                                                                                                                                                                                                                                                           |
|-----------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| (3)  | Represents future minimum payments under noncancelable operating leases with initial or remaining terms of one year or more.  We enter into operating leases, some of which include renewal options.  We have excluded renewal options from the table above unless it is anticipated that we will exercise such renewals. |

|           |                                                                                                                                                                                                                                                                                                                                            |
|-----------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| (4)  | Purchase obligations include capital improvements as well as agreements to purchase goods or services that are enforceable and legally binding and that specify all significant terms, including: fixed or minimum quantities to be purchased; fixed, minimum or variable price provisions; and the approximate timing of the transaction. |

|           |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         |
|-----------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| (5)  | The estimated income tax liabilities for uncertain tax positions will be settled as a result of expiring statutes, audit activity, competent authority proceedings related to transfer pricing, or final decisions in matters that are the subject of litigation in various taxing jurisdictions in which we operate.  The timing of any particular settlement will depend on the length of the tax audit and related appeals process, if any, or an expiration of a statute.  If a liability is settled due to a statute expiring or a favorable audit result, the settlement of the tax liability would not result in a cash payment. |

|           |                                                                                                                                                                              |
|-----------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| (6)  | Does not include obligations for pension and other postretirement benefits for which we expect to make employer contributions between $115 million and $129 million in 2014. |

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|                                 |
|---------------------------------|
|                                 |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
| (In millions)                   | 2013 |   | 2014 |   | 2015 |   | 2016 |   | 2017 |   | 2018 |   | Thereafter |   | Total |
| As of December 31, 2013         |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Long-term debt (1) (2)          | $ | — |  |   | $ | — |  |   | $ | 21 |  |   | $ | 17 |  |   | $ | 11 |  |   | $ | 1,013 |  |   | $ | 2,849 |  |   | $ | 3,911 |  |
| Weighted average interest rates | — |  |   | — |  |   | 13.68 | % |   | 17.71 | % |   | 17.47 | % |   | 7.41 | % |   | 5.36 | % |   | 6.02 | % |
| As of December 31, 2012         |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Long-term debt (1) (2)          | $ | — |  |   | $ | — |  |   | $ | — |  |   | $ | — |  |   | $ | — |  |   | $ | 1,000 |  |   | $ | 2,800 |  |   | $ | 3,800 |  |
| Weighted average interest rates | — |  |   | — |  |   | — |  |   | — |  |   | — |  |   | 7.28 | % |   | 5.17 | % |   | 5.72 | % |

|           |                                                                                                               |
|-----------|---------------------------------------------------------------------------------------------------------------|
| (1)  | Amounts do not include any unamortized discounts or deferred issuance costs on our fixed rate long-term debt. |

|           |                                                                                                                                                 |
|-----------|-------------------------------------------------------------------------------------------------------------------------------------------------|
| (2)  | Fair market value of our fixed rate long-term debt was $4.36 billion at December 31, 2013 and $4.68 billion at December 31, 2012. |

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|                                                                               |
|-------------------------------------------------------------------------------|
|                                                                               |  |  |  |  |
| /s/ MARTIN S. CRAIGHEADMartin S. CraigheadChairman andChief Executive Officer |    | /s/ PETER A. RAGAUSSPeter A. RagaussSenior Vice President andChief Financial Officer |    | /s/ ALAN J. KEIFERAlan J. KeiferVice President andController |

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|                                                         |
|---------------------------------------------------------|
|                                                         |  |  |  |  |  |  |  |  |  |  |  |
|                                                    | Year Ended December 31, |
| (In millions, except per share amounts)                 | 2013 |   | 2012 |   | 2011 |
| Revenue:                                                |   |   |   |   |   |
| Sales                                                   | $ | 7,594 |  |   | $ | 7,274 |  |   | $ | 6,382 |  |
| Services                                                | 14,770 |  |   | 14,087 |  |   | 13,449 |  |
| Total revenue                                           | 22,364 |  |   | 21,361 |  |   | 19,831 |  |
| Costs and expenses:                                     |   |   |   |   |   |
| Cost of sales                                           | 5,932 |  |   | 5,758 |  |   | 5,122 |  |
| Cost of services                                        | 12,621 |  |   | 11,598 |  |   | 10,142 |  |
| Research and engineering                                | 556 |  |   | 497 |  |   | 462 |  |
| Marketing, general and administrative                   | 1,306 |  |   | 1,316 |  |   | 1,190 |  |
| Impairment of trade names                               | — |  |   | — |  |   | 315 |  |
| Total costs and expenses                                | 20,415 |  |   | 19,169 |  |   | 17,231 |  |
| Operating income                                        | 1,949 |  |   | 2,192 |  |   | 2,600 |  |
| Interest expense, net                                   | (234 | ) |   | (210 | ) |   | (221 | ) |
| Loss on early extinguishment of debt                    | — |  |   | — |  |   | (40 | ) |
| Income before income taxes                              | 1,715 |  |   | 1,982 |  |   | 2,339 |  |
| Income taxes                                            | (612 | ) |   | (665 | ) |   | (596 | ) |
| Net income                                              | 1,103 |  |   | 1,317 |  |   | 1,743 |  |
| Net income attributable to noncontrolling interests     | (7 | ) |   | (6 | ) |   | (4 | ) |
| Net income attributable to Baker Hughes                 | $ | 1,096 |  |   | $ | 1,311 |  |   | $ | 1,739 |  |
|                                                    |   |   |   |   |   |
| Basic earnings per share attributable to Baker Hughes   | $ | 2.47 |  |   | $ | 2.98 |  |   | $ | 3.99 |  |
|                                                    |   |   |   |   |   |
| Diluted earnings per share attributable to Baker Hughes | $ | 2.47 |  |   | $ | 2.97 |  |   | $ | 3.97 |  |

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|-----------------------------------------------------------------------------------------------|
|                                                                                               |  |  |  |  |  |  |  |  |  |  |  |
|                                                                                          | Year Ended December 31, |
| (In millions)                                                                                 | 2013 |   | 2012 |   | 2011 |
| Net income                                                                                    | $ | 1,103 |  |   | $ | 1,317 |  |   | $ | 1,743 |  |
| Other comprehensive (loss) income:                                                            |   |   |   |   |   |
| Foreign currency translation adjustments during the period                                    | (61 | ) |   | 78 |  |   | (44 | ) |
| Pension and other postretirement benefits, net of tax(2013 - $(23); 2012 - $(13); 2011 - $44) | 33 |  |   | 1 |  |   | (92 | ) |
| Other comprehensive (loss) income                                                             | (28 | ) |   | 79 |  |   | (136 | ) |
| Comprehensive income                                                                          | 1,075 |  |   | 1,396 |  |   | 1,607 |  |
| Comprehensive income attributable to noncontrolling interests                                 | (7 | ) |   | (6 | ) |   | (3 | ) |
| Comprehensive income attributable to Baker Hughes                                             | $ | 1,068 |  |   | $ | 1,390 |  |   | $ | 1,604 |  |

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|                                                                                                              |
|--------------------------------------------------------------------------------------------------------------|
|                                                                                                              |  |  |  |  |  |  |  |
|                                                                                                         | December 31, |
| (In millions, except par value)                                                                              | 2013 |   | 2012 |
| ASSETS                                                                                                       |
| Current Assets:                                                                                              |   |   |   |
| Cash and cash equivalents                                                                                    | $ | 1,399 |  |   | $ | 1,015 |  |
|  Accounts receivable - less allowance for doubtful accounts(2013 - $238; 2012 - $308)                   | 5,138 |  |   | 4,815 |  |
| Inventories, net                                                                                             | 3,884 |  |   | 3,781 |  |
| Deferred income taxes                                                                                        | 380 |  |   | 266 |  |
| Other current assets                                                                                         | 494 |  |   | 540 |  |
| Total current assets                                                                                         | 11,295 |  |   | 10,417 |  |
|                                                                                                         |   |   |   |
| Property, plant and equipment - less accumulated depreciation(2013 - $7,219; 2012 - $6,315)                  | 9,076 |  |   | 8,707 |  |
| Goodwill                                                                                                     | 5,966 |  |   | 5,958 |  |
| Intangible assets, net                                                                                       | 883 |  |   | 993 |  |
| Other assets                                                                                                 | 714 |  |   | 614 |  |
| Total assets                                                                                                 | $ | 27,934 |  |   | $ | 26,689 |  |
| LIABILITIES AND EQUITY                                                                                       |
| Current Liabilities:                                                                                         |   |   |   |
| Accounts payable                                                                                             | $ | 2,574 |  |   | $ | 1,737 |  |
| Short-term debt and current portion of long-term debt                                                        | 499 |  |   | 1,079 |  |
| Accrued employee compensation                                                                                | 778 |  |   | 646 |  |
| Income taxes payable                                                                                         | 213 |  |   | 226 |  |
| Other accrued liabilities                                                                                    | 514 |  |   | 436 |  |
| Total current liabilities                                                                                    | 4,578 |  |   | 4,124 |  |
|                                                                                                         |   |   |   |
| Long-term debt                                                                                               | 3,882 |  |   | 3,837 |  |
| Deferred income taxes and other tax liabilities                                                              | 821 |  |   | 745 |  |
| Liabilities for pensions and other postretirement benefits                                                   | 583 |  |   | 579 |  |
| Other liabilities                                                                                            | 158 |  |   | 136 |  |
| Commitments and contingencies                                                                                |  |   |  |
|                                                                                                         |   |   |   |
| Equity:                                                                                                      |   |   |   |
| Common stock, one dollar par value(shares authorized - 750; issued and outstanding:  2013 - 438; 2012 - 441) | 438 |  |   | 441 |  |
| Capital in excess of par value                                                                               | 7,341 |  |   | 7,495 |  |
| Retained earnings                                                                                            | 10,438 |  |   | 9,609 |  |
| Accumulated other comprehensive loss                                                                         | (504 | ) |   | (476 | ) |
| Baker Hughes stockholders’ equity                                                                      | 17,713 |  |   | 17,069 |  |
| Noncontrolling interests                                                                                     | 199 |  |   | 199 |  |
| Total equity                                                                                                 | 17,912 |  |   | 17,268 |  |
| Total liabilities and equity                                                                                 | $ | 27,934 |  |   | $ | 26,689 |  |

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|--------------------------------------------------|
|                                                  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
| (In millions, except per share amounts)          | Common Stock |   | Capital in Excess of Par Value |   | Retained Earnings |   | Accumulated Other Comprehensive Loss |   | Non-controlling Interests |   | Total |
| Balance at December 31, 2010                     | $ | 432 |  |   | $ | 7,005 |  |   | $ | 7,083 |  |   | $ | (420 | ) |   | $ | 186 |  |   | $ | 14,286 |  |
| Comprehensive income:                            |   |   |   |   |   |   |   |   |   |   |   |
| Net income                                       |   |   |   |   | 1,739 |  |   |   |   | 4 |  |   | 1,743 |  |
| Other comprehensive loss                         |   |   |   |   |   |   | (135 | ) |   | (1 | ) |   | (136 | ) |
| Activity related to stock plans                  | 5 |  |   | 179 |  |   |   |   |   |   |   |   | 184 |  |
| Stock-based compensation cost                    |   |   | 108 |  |   |   |   |   |   |   |   | 108 |  |
| Cash dividends ($0.60 per share)                 |   |   |   |   | (261 | ) |   |   |   |   |   | (261 | ) |
| Net activity related to noncontrolling interests |   |   | 11 |  |   |   |   |   |   | 29 |  |   | 40 |  |
| Balance at December 31, 2011                     | $ | 437 |  |   | $ | 7,303 |  |   | $ | 8,561 |  |   | $ | (555 | ) |   | $ | 218 |  |   | $ | 15,964 |  |
| Comprehensive income:                            |   |   |   |   |   |   |   |   |   |   |   |
| Net income                                       |   |   |   |   | 1,311 |  |   |   |   | 6 |  |   | 1,317 |  |
| Other comprehensive income                       |   |   |   |   |   |   | 79 |  |   |   |   | 79 |  |
| Activity related to stock plans                  | 4 |  |   | 55 |  |   |   |   |   |   |   |   | 59 |  |
| Stock-based compensation cost                    |   |   | 115 |  |   |   |   |   |   |   |   | 115 |  |
| Cash dividends ($0.60 per share)                 |   |   |   |   | (263 | ) |   |   |   |   |   | (263 | ) |
| Net activity related to noncontrolling interests |   |   | 22 |  |   |   |   |   |   | (25 | ) |   | (3 | ) |
| Balance at December 31, 2012                     | $ | 441 |  |   | $ | 7,495 |  |   | $ | 9,609 |  |   | $ | (476 | ) |   | $ | 199 |  |   | $ | 17,268 |  |
| Comprehensive income:                            |   |   |   |   |   |   |   |   |   |   |   |
| Net income                                       |   |   |   |   | 1,096 |  |   |   |   | 7 |  |   | 1,103 |  |
| Other comprehensive loss                         |   |   |   |   |   |   | (28 | ) |   |  |   | (28 | ) |
| Activity related to stock plans                  | 3 |  |   | 75 |  |   |   |   |   |   |   |   | 78 |  |
| Repurchase and retirement of common stock        | (6 | ) |   | (344 | ) |   |   |   |   |   |   |   | (350 | ) |
| Stock-based compensation cost                    |   |   | 115 |  |   |   |   |   |   |   |   | 115 |  |
| Cash dividends ($0.60 per share)                 |   |   |   |   | (267 | ) |   |   |   |   |   | (267 | ) |
| Net activity related to noncontrolling interests |   |   |  |   |   |   |   |   | (7 | ) |   | (7 | ) |
| Balance at December 31, 2013                     | $ | 438 |  |   | $ | 7,341 |  |   | $ | 10,438 |  |   | $ | (504 | ) |   | $ | 199 |  |   | $ | 17,912 |  |

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|                                                                                                                     |
|---------------------------------------------------------------------------------------------------------------------|
|                                                                                                                     |  |  |  |  |  |  |  |  |  |  |  |
|                                                                                                                | Year Ended December 31, |
| (In millions)                                                                                                       | 2013 |   | 2012 |   | 2011 |
| Cash flows from operating activities:                                                                               |   |   |   |   |   |
| Net income                                                                                                          | $ | 1,103 |  |   | $ | 1,317 |  |   | $ | 1,743 |  |
| Adjustments to reconcile net income to net cash flows from operating activities:                                    |   |   |   |   |   |
| Depreciation and amortization                                                                                       | 1,698 |  |   | 1,568 |  |   | 1,321 |  |
| Provision (benefit) for deferred income taxes                                                                  | 1 |  |   | (114 | ) |   | (492 | ) |
| Gain on disposal of assets                                                                                          | (275 | ) |   | (222 | ) |   | (179 | ) |
| Stock-based compensation cost                                                                                       | 115 |  |   | 115 |  |   | 108 |  |
| Provision for doubtful accounts                                                                                     | 75 |  |   | 100 |  |   | 84 |  |
| Impairment of trade names                                                                                           | — |  |   | — |  |   | 315 |  |
| Loss on impairment of assets                                                                                        | — |  |   | 55 |  |   | — |  |
| Loss on early extinguishment of debt                                                                                | — |  |   | — |  |   | 40 |  |
| Changes in operating assets and liabilities:                                                                        |   |   |   |   |   |
| Accounts receivable                                                                                                 | (453 | ) |   | 16 |  |   | (1,024 | ) |
| Inventories                                                                                                         | (120 | ) |   | (547 | ) |   | (641 | ) |
| Accounts payable                                                                                                    | 845 |  |   | (94 | ) |   | 314 |  |
| Accrued employee compensation and other accrued liabilities                                                         | 231 |  |   | (90 | ) |   | 58 |  |
| Income taxes payable                                                                                                | (31 | ) |   | (56 | ) |   | (121 | ) |
| Other operating items, net                                                                                          | (28 | ) |   | (213 | ) |   | (19 | ) |
| Net cash flows provided by operating activities                                                                     | 3,161 |  |   | 1,835 |  |   | 1,507 |  |
| Cash flows from investing activities:                                                                               |   |   |   |   |   |
| Expenditures for capital assets                                                                                     | (2,085 | ) |   | (2,910 | ) |   | (2,461 | ) |
| Proceeds from disposal of assets                                                                                    | 455 |  |   | 389 |  |   | 311 |  |
| Proceeds from maturities of short-term investments                                                                  | — |  |   | — |  |   | 250 |  |
| Other investing items, net                                                                                          | (33 | ) |   | — |  |   | 9 |  |
| Net cash flows used in investing activities                                                                         | (1,663 | ) |   | (2,521 | ) |   | (1,891 | ) |
| Cash flows from financing activities:                                                                               |   |   |   |   |   |
| Net (repayments) proceeds of commercial paper borrowings and other debt with three months or less original maturity | (650 | ) |   | 764 |  |   | 125 |  |
| Repayment of short-term debt with greater than three months original maturity                                       | (163 | ) |   | (92 | ) |   | — |  |
| Proceeds of short-term debt with greater than three months original maturity                                        | 242 |  |   | 175 |  |   | — |  |
| Proceeds of long-term debt                                                                                          | — |  |   | — |  |   | 742 |  |
| Repayment of long-term debt                                                                                         | — |  |   | — |  |   | (813 | ) |
| Repurchase of common stock                                                                                          | (350 | ) |   | — |  |   | — |  |
| Proceeds from issuance of common stock                                                                              | 101 |  |   | 81 |  |   | 183 |  |
| Dividends paid                                                                                                      | (267 | ) |   | (263 | ) |   | (261 | ) |
| Other financing items, net                                                                                          | (16 | ) |   | (19 | ) |   | (6 | ) |
| Net cash flows (used in) provided by financing activities                                                           | (1,103 | ) |   | 646 |  |   | (30 | ) |
| Effect of foreign exchange rate changes on cash and cash equivalents                                                | (11 | ) |   | 5 |  |   | 8 |  |
| Decrease in cash and cash equivalents                                                                               | 384 |  |   | (35 | ) |   | (406 | ) |
| Cash and cash equivalents, beginning of period                                                                      | 1,015 |  |   | 1,050 |  |   | 1,456 |  |
| Cash and cash equivalents, end of period                                                                            | $ | 1,399 |  |   | $ | 1,015 |  |   | $ | 1,050 |  |
| Supplemental cash flows disclosures:                                                                                |   |   |   |   |   |
| Income taxes paid, net of refunds                                                                                   | $ | 651 |  |   | $ | 941 |  |   | $ | 1,192 |  |
| Interest paid                                                                                                       | $ | 247 |  |   | $ | 241 |  |   | $ | 237 |  |
| Supplemental disclosure of noncash investing activities:                                                            |   |   |   |   |   |
| Capital expenditures included in accounts payable                                                                   | $ | 142 |  |   | $ | 140 |  |   | $ | 111 |  |

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|                                           |
|-------------------------------------------|
|                                           |  |  |  |  |  |  |  |  |  |  |  |
|                                      | 2013 |   | 2012 |   | 2011 |
| Stock-based compensation cost             | $ | 115 |  |   | $ | 115 |  |   | $ | 108 |  |
| Tax benefit                               | (24 | ) |   | (20 | ) |   | (22 | ) |
| Stock-based compensation cost, net of tax | $ | 91 |  |   | $ | 95 |  |   | $ | 86 |  |

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|                                                     |
|-----------------------------------------------------|
|                                                     |  |  |  |  |  |  |  |  |  |  |  |
|                                                | 2013 |   | 2012 |   | 2011 |
| Expected life (years)                               | 5.2 |  |   | 5.4 |  |   | 5.0 |  |
| Risk-free interest rate                             | 1.3 | % |   | 0.9 | % |   | 1.8 | % |
| Volatility                                          | 36.0 | % |   | 41.4 | % |   | 40.8 | % |
| Dividend yield                                      | 1.3 | % |   | 1.4 | % |   | 0.9 | % |
| Weighted average fair value per share at grant date | $ | 13.79 |  |   | $ | 14.51 |  |   | $ | 24.20 |  |

|                                  |
|----------------------------------|
|                                  |  |  |  |  |  |  |  |  |  |  |
|                             | Number ofOptions |   | Weighted AverageExercise PricePer Option |
| Outstanding at December 31, 2012 |   | 11,156 |  |   |   |   | $ | 51.79 |  |   |
| Granted                          |   | 2,635 |  |   |   |   | 46.46 |  |   |
| Exercised                        |   | (722 | ) |   |   |   | 35.84 |  |   |
| Forfeited                        |   | (159 | ) |   |   |   | 48.23 |  |   |
| Expired                          |   | (704 | ) |   |   |   | 70.27 |  |   |
| Outstanding at December 31, 2013 |   | 12,206 |  |   |   |   | $ | 50.57 |  |   |
|                             |   |   |   |   |   |   |   |
| Exercisable at December 31, 2013 |   | 7,895 |  |   |   |   | $ | 52.58 |  |   |

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|                                       |
|---------------------------------------|
|                                       |  |  |  |  |  |  |
|                                  | Number ofAwards and Units |   | Weighted AverageGrant Date FairValue Per Award/Unit |
| Unvested balance at December 31, 2012 | 2,411 |  |   | $ | 50.71 |  |
| Granted                               | 1,596 |  |   | 45.58 |  |
| Vested                                | (1,129 | ) |   | 51.60 |  |
| Forfeited                             | (226 | ) |   | 48.34 |  |
| Unvested balance at December 31, 2013 | 2,652 |  |   | $ | 47.44 |  |

|                                                           |
|-----------------------------------------------------------|
|                                                           |  |  |  |  |  |  |  |  |  |  |  |
|                                                      | 2013 |   | 2012 |   | 2011 |
| Expected life (years)                                     | 0.5 |  |   | 0.5 |  |   | 0.5 |  |
| Risk-free interest rate                                   | 0.1 | % |   | 0.1 | % |   | 0.1 | % |
| Volatility                                                | 30.3 | % |   | 44.1 | % |   | 36.6 | % |
| Dividend yield                                            | 1.4 | % |   | 1.3 | % |   | 1.0 | % |
|                                                      |   |   |   |   |   |
| Fair value per share of the 15% cash discount             | $ | 6.45 |  |   | $ | 6.71 |  |   | $ | 9.62 |  |
| Fair value per share of the look-back provision           | 3.58 |  |   | 5.46 |  |   | 6.50 |  |
| Total weighted average fair value per share at grant date | $ | 10.03 |  |   | $ | 12.17 |  |   | $ | 16.12 |  |

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|                            |
|----------------------------|
|                            |  |  |  |  |  |  |  |  |  |  |  |
|                       | 2013 |   | 2012 |   | 2011 |
| Current:                   |   |   |   |   |   |
| U.S.                       | $ | 159 |  |   | $ | 251 |  |   | $ | 609 |  |
| Foreign                    | 452 |  |   | 528 |  |   | 479 |  |
| Total current              | 611 |  |   | 779 |  |   | 1,088 |  |
| Deferred:                  |   |   |   |   |   |
| U.S.                       | (54 | ) |   | (57 | ) |   | (315 | ) |
| Foreign                    | 55 |  |   | (57 | ) |   | (177 | ) |
| Total deferred             | 1 |  |   | (114 | ) |   | (492 | ) |
| Provision for income taxes | $ | 612 |  |   | $ | 665 |  |   | $ | 596 |  |

|                            |
|----------------------------|
|                            |  |  |  |  |  |  |  |  |  |  |  |
|                       | 2013 |   | 2012 |   | 2011 |
| U.S.                       | $ | 512 |  |   | $ | 700 |  |   | $ | 1,466 |  |
| Foreign                    | 1,203 |  |   | 1,282 |  |   | 873 |  |
| Income before income taxes | $ | 1,715 |  |   | $ | 1,982 |  |   | $ | 2,339 |  |

|                                                          |
|----------------------------------------------------------|
|                                                          |  |  |  |  |  |  |  |  |
|                                                     | 2013 |   | 2012 |   | 2011 |
| U.S. statutory income tax rate                           | 35.0 |  % |   | 35.0 |  % |   | 35.0 |  % |
| Effect of foreign operations                             | (8.7 | ) |   | (2.0 | ) |   | (0.5 | ) |
| Change in valuation allowances related to foreign losses | 8.9 |  |   | 0.9 |  |   | 2.2 |  |
| Adjustments of prior years’ tax positions          | 0.9 |  |   | (2.9 | ) |   | (2.2 | ) |
| State income taxes - net of U.S. tax benefit             | 0.8 |  |   | 1.8 |  |   | 1.7 |  |
| Impact of reorganization of certain foreign subsidiaries | (1.0 | ) |   | — |  |   | (9.1 | ) |
| Other - net                                              | (0.2 | ) |   | 0.8 |  |   | (1.6 | ) |
| Total effective tax rate                                 | 35.7 |  % |   | 33.6 |  % |   | 25.5 |  % |

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|                                                |
|------------------------------------------------|
|                                                |  |  |  |  |  |  |  |
|                                           | 2013 |   | 2012 |
| Deferred tax assets:                           |   |   |   |
| Receivables                                    | $ | 68 |  |   | $ | 76 |  |
| Inventory                                      | 347 |  |   | 250 |  |
| Employee benefits                              | 98 |  |   | 125 |  |
| Other accrued expenses                         | 185 |  |   | 154 |  |
| Operating loss carryforwards                   | 403 |  |   | 245 |  |
| Tax credit carryforwards                       | 462 |  |   | 460 |  |
| Other                                          | 70 |  |   | 70 |  |
| Subtotal                                       | 1,633 |  |   | 1,380 |  |
| Valuation allowances                           | (949 | ) |   | (389 | ) |
| Total                                          | 684 |  |   | 991 |  |
| Deferred tax liabilities:                      |   |   |   |
| Goodwill and other intangibles                 | 356 |  |   | 385 |  |
| Property                                       | 459 |  |   | 355 |  |
| Undistributed earnings of foreign subsidiaries | 14 |  |   | 374 |  |
| Other                                          | 24 |  |   | 27 |  |
| Total                                          | 853 |  |   | 1,141 |  |
| Net deferred tax liability                     | $ | (169 | ) |   | $ | (150 | ) |

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|                                                         |
|---------------------------------------------------------|
|                                                         |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
|                                                    | Gross Unrecognized TaxBenefits, ExcludingInterest and Penalties |   | Interest andPenalties |   | Total GrossUnrecognized TaxBenefits |
| Balance at December 31, 2010                            |   | $ | 324 |  |   |   | $ | 114 |  |   |   | $ | 438 |  |   |
| (Decrease) increase in prior year tax positions         |   | (5 | ) |   |   | 12 |  |   |   | 7 |  |   |
| Increase in current year tax positions                  |   | 8 |  |   |   | 11 |  |   |   | 19 |  |   |
| Decrease related to settlements with taxing authorities |   | (3 | ) |   |   | (1 | ) |   |   | (4 | ) |   |
| Decrease related to lapse of statute of limitations     |   | (38 | ) |   |   | (38 | ) |   |   | (76 | ) |   |
| Decrease due to effects of foreign currency translation |   | (3 | ) |   |   | (2 | ) |   |   | (5 | ) |   |
| Balance at December 31, 2011                            |   | 283 |  |   |   | 96 |  |   |   | 379 |  |  |
| Decrease in prior year tax positions                    |   | (18 | ) |   |   | (5 | ) |   |   | (23 | ) |   |
| Increase in current year tax positions                  |   | 6 |  |   |   | 1 |  |   |   | 7 |  |   |
| Decrease related to settlements with taxing authorities |   | (34 | ) |   |   | (9 | ) |   |   | (43 | ) |   |
| Decrease related to lapse of statute of limitations     |   | (38 | ) |   |   | (9 | ) |   |   | (47 | ) |   |
| Decrease due to effects of foreign currency translation |   | (3 | ) |   |   | (3 | ) |   |   | (6 | ) |   |
| Balance at December 31, 2012                            |   | 196 |  |   |   | 71 |  |   |   | 267 |  |  |
| Increase (decrease) in prior year tax positions         |   | 20 |  |   |   | (2 | ) |   |   | 18 |  |   |
| Increase in current year tax positions                  |   | 44 |  |   |   | 1 |  |   |   | 45 |  |   |
| Decrease related to settlements with taxing authorities |   | (15 | ) |   |   | (4 | ) |   |   | (19 | ) |   |
| Decrease related to lapse of statute of limitations     |   | (17 | ) |   |   | (10 | ) |   |   | (27 | ) |   |
| Decrease due to effects of foreign currency translation |   | — |  |   |   | (2 | ) |   |   | (2 | ) |   |
| Balance at December 31, 2013                            |   | $ | 228 |  |   |   | $ | 54 |  |   |   | $ | 282 |  |  |

|              |
|--------------|
|              |  |  |  |  |  |  |
| Jurisdiction |   | Earliest Open Tax Period |   | Jurisdiction |   | Earliest Open Tax Period |
| Canada       |   | 2005 |   | Norway |   | 1999 |
| Germany      |   | 2008 |   | Saudi Arabia |   | 2003 |
| Netherlands  |   | 2008 |   | U.S. |   | 2010 |

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|                                                                                     |
|-------------------------------------------------------------------------------------|
|                                                                                     |  |  |  |  |  |  |  |  |
|                                                                                | 2013 |   | 2012 |   | 2011 |
| Weighted average common shares outstanding for basic EPS                            | 443 |  |   | 440 |  |   | 436 |  |
| Effect of dilutive securities - stock plans                                         | 1 |  |   | 1 |  |   | 2 |  |
| Adjusted weighted average common shares outstanding for diluted EPS                 | 444 |  |   | 441 |  |   | 438 |  |
| Future potentially dilutive shares excluded from diluted EPS:                       |   |   |   |   |   |
| Options with an exercise price greater than the average market price for the period | 4 |  |   | 7 |  |   | 3 |  |

|                   |
|-------------------|
|                   |  |  |  |  |  |  |  |
|              | 2013 |   | 2012 |
| Finished goods    | $ | 3,438 |  |   | $ | 3,336 |  |
| Work in process   | 215 |  |   | 228 |  |
| Raw materials     | 231 |  |   | 217 |  |
| Total inventories | $ | 3,884 |  |   | $ | 3,781 |  |

|                                     |
|-------------------------------------|
|                                     |  |  |  |  |  |  |  |  |  |
|                                | Useful Life |   | 2013 |   | 2012 |
| Land                                |   |   | $ | 294 |  |   | $ | 253 |  |
| Buildings and improvements          | 5 - 30 years |   | 2,621 |  |   | 2,408 |  |
| Machinery, equipment and other      | 1 - 20 years |   | 13,380 |  |   | 12,361 |  |
| Subtotal                            |   |   | 16,295 |  |   | 15,022 |  |
| Less:  Accumulated depreciation     |   |   | 7,219 |  |   | 6,315 |  |
| Total property, plant and equipment |   |   | $ | 9,076 |  |   | $ | 8,707 |  |

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|                              |
|------------------------------|
|                              |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
|                         | NorthAmerica |   | LatinAmerica |   | Europe/Africa/RussiaCaspian |   | MiddleEast/AsiaPacific |   | IndustrialServices |   | Total Goodwill |
| Balance at December 31, 2012 | $ | 3,069 |  |   | $ | 586 |  |   | $ | 1,018 |  |   | $ | 852 |  |   | $ | 433 |  |   | $ | 5,958 |  |
| Acquisitions and other       | (4 | ) |   | 1 |  |   | 12 |  |   | — |  |   | (1 | ) |   | 8 |  |
| Balance at December 31, 2013 | $ | 3,065 |  |   | $ | 587 |  |   | $ | 1,030 |  |   | $ | 852 |  |   | $ | 432 |  |   | $ | 5,966 |  |

|                        |
|------------------------|
|                        |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
|                   | 2013 |   | 2012 |
|              | GrossCarryingAmount |   | Less:AccumulatedAmortization |   | Net |   | GrossCarryingAmount |   | Less:AccumulatedAmortization |   | Net |
| Technology             | $ | 814 |  |   | $ | 337 |  |   | $ | 477 |  |   | $ | 787 |  |   | $ | 282 |  |   | $ | 505 |  |
| Customer relationships | 494 |  |   | 157 |  |   | 337 |  |   | 494 |  |   | 117 |  |   | 377 |  |
| Trade names            | 120 |  |   | 82 |  |   | 38 |  |   | 121 |  |   | 60 |  |   | 61 |  |
| Other (1)              | 43 |  |   | 12 |  |   | 31 |  |   | 60 |  |   | 10 |  |   | 50 |  |
| Total intangibles      | $ | 1,471 |  |   | $ | 588 |  |   | $ | 883 |  |   | $ | 1,462 |  |   | $ | 469 |  |   | $ | 993 |  |

|           |                                                                                                                                                                                             |
|-----------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| (1)  | Includes indefinite-lived intangibles of $27 million and $44 million at December 31, 2013 and 2012, respectively, related to in-process research and development projects. |

|                              |
|------------------------------|
|                              |  |  |  |
|                         | 2011 |
| North America                | $ | 105 |  |
| Latin America                | 64 |  |
| Europe/Africa/Russia Caspian | 48 |  |
| Middle East/Asia Pacific     | 47 |  |
| Industrial Services          | 51 |  |
| Total                        | $ | 315 |  |

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|      |
|------|
|      |  |  |
| Year | Estimated Amortization Expense |
| 2014 | 104 |  |
| 2015 | 97 |  |
| 2016 | 95 |  |
| 2017 | 92 |  |
| 2018 | 86 |  |

|                                                                             |
|-----------------------------------------------------------------------------|
|                                                                             |  |  |  |  |  |  |  |
|                                                                        | 2013 |   | 2012 |
| 6.0% Notes due June 2018 with an effective interest rate of 4.8%            | $ | 260 |  |   | $ | 263 |  |
| 7.5% Senior Notes due November 2018 with an effective interest rate of 7.6% | 745 |  |   | 744 |  |
| 3.2% Senior Notes due August 2021 with an effective interest rate of 3.3%   | 744 |  |   | 743 |  |
| 8.55% Debentures due June 2024 with an effective interest rate of 8.8%      | 148 |  |   | 148 |  |
| 6.875% Notes due January 2029 with an effective interest rate of 7.1%       | 394 |  |   | 393 |  |
| 5.125% Notes due September 2040 with an effective interest rate of 5.2%     | 1,480 |  |   | 1,480 |  |
| Commercial paper with an effective interest rate of 0.2%                    | 254 |  |   | 925 |  |
| Other debt with an effective interest rate of 11.1%                         | 356 |  |   | 220 |  |
| Total debt                                                                  | 4,381 |  |   | 4,916 |  |
| Less:  short-term debt and current portion of long-term debt                | 499 |  |   | 1,079 |  |
| Total long-term debt                                                        | $ | 3,882 |  |   | $ | 3,837 |  |

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|                                      |
|--------------------------------------|
|                                      |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
|                                 | 2013 |   | 2012 |   | 2011 |
| Segments                             | Revenue |   | Profit (Loss) Before Tax |   | Revenue |   | Profit (Loss) Before Tax |   | Revenue |   | Profit (Loss) Before Tax |
| North America                        | $ | 10,878 |  |   | $ | 968 |  |   | $ | 10,836 |  |   | $ | 1,268 |  |   | $ | 10,279 |  |   | $ | 1,908 |  |
| Latin America                        | 2,307 |  |   | 66 |  |   | 2,399 |  |   | 197 |  |   | 2,190 |  |   | 223 |  |
| Europe/Africa/Russia Caspian         | 3,850 |  |   | 570 |  |   | 3,634 |  |   | 586 |  |   | 3,372 |  |   | 336 |  |
| Middle East/Asia Pacific             | 4,050 |  |   | 478 |  |   | 3,275 |  |   | 313 |  |   | 2,852 |  |   | 310 |  |
| Industrial Services                  | 1,279 |  |   | 135 |  |   | 1,217 |  |   | 131 |  |   | 1,138 |  |   | 95 |  |
| Total Operations                     | 22,364 |  |   | 2,217 |  |   | 21,361 |  |   | 2,495 |  |   | 19,831 |  |   | 2,872 |  |
| Corporate and other                  | — |  |   | (268 | ) |   | — |  |   | (303 | ) |   | — |  |   | (272 | ) |
| Interest expense, net                | — |  |   | (234 | ) |   | — |  |   | (210 | ) |   | — |  |   | (221 | ) |
| Loss on early extinguishment of debt | — |  |   | — |  |   | — |  |   | — |  |   | — |  |   | (40 | ) |
| Total                                | $ | 22,364 |  |   | $ | 1,715 |  |   | $ | 21,361 |  |   | $ | 1,982 |  |   | $ | 19,831 |  |   | $ | 2,339 |  |

----

Table of Contents

|                              |
|------------------------------|
|                              |  |  |  |  |  |  |  |  |  |  |  |
|                         | 2013 |   | 2012 |   | 2011 |
| Segments                     | Assets |   | Assets |   | Assets |
| North America                | $ | 9,672 |  |   | $ | 9,533 |  |   | $ | 9,168 |  |
| Latin America                | 2,709 |  |   | 2,740 |  |   | 2,539 |  |
| Europe/Africa/Russia Caspian | 3,969 |  |   | 3,617 |  |   | 3,552 |  |
| Middle East/Asia Pacific     | 3,834 |  |   | 3,537 |  |   | 3,173 |  |
| Industrial Services          | 980 |  |   | 978 |  |   | 947 |  |
| Shared assets                | 5,110 |  |   | 5,044 |  |   | 4,557 |  |
| Total Operations             | 26,274 |  |   | 25,449 |  |   | 23,936 |  |
| Corporate and other          | 1,660 |  |   | 1,240 |  |   | 911 |  |
| Total                        | $ | 27,934 |  |   | $ | 26,689 |  |   | $ | 24,847 |  |

|                              |
|------------------------------|
|                              |  |  |  |  |  |  |  |
|                         | Assets |
|                         | Increase/(decrease) |
| Segments                     | 2012 |   | 2011 |
| North America                | $ | (643 | ) |   | $ | (641 | ) |
| Latin America                | (158 | ) |   | (191 | ) |
| Europe/Africa/Russia Caspian | (279 | ) |   | (296 | ) |
| Middle East/Asia Pacific     | (148 | ) |   | (148 | ) |
| Industrial Services          | (3,814 | ) |   | (3,280 | ) |
| Shared assets                | 5,044 |  |   | 4,557 |  |
| Total Operations             | 2 |  |   | 1 |  |
| Corporate and other          | (2 | ) |   | (1 | ) |
| Total                        | $ | — |  |   | $ | — |  |

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Table of Contents

|                              |
|------------------------------|
|                              |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
|                         | 2013 |   | 2012 |   | 2011 |
| Segments                     | CapitalExpenditures |   | DepreciationandAmortization |   | CapitalExpenditures |   | DepreciationandAmortization |   | CapitalExpenditures |   | DepreciationandAmortization |
| North America                | $ | 718 |  |   | $ | 814 |  |   | $ | 1,333 |  |   | $ | 750 |  |   | $ | 1,212 |  |   | $ | 625 |  |
| Latin America                | 198 |  |   | 235 |  |   | 222 |  |   | 225 |  |   | 265 |  |   | 202 |  |
| Europe/Africa/Russia/Caspian | 419 |  |   | 291 |  |   | 358 |  |   | 257 |  |   | 345 |  |   | 236 |  |
| Middle East/Asia Pacific     | 375 |  |   | 279 |  |   | 332 |  |   | 234 |  |   | 218 |  |   | 207 |  |
| Industrial Services          | 53 |  |   | 58 |  |   | 40 |  |   | 55 |  |   | 36 |  |   | 49 |  |
| Shared assets                | 262 |  |   | — |  |   | 604 |  |   | — |  |   | 351 |  |   | — |  |
| Total Operations             | 2,025 |  |   | 1,677 |  |   | 2,889 |  |   | 1,521 |  |   | 2,427 |  |   | 1,319 |  |
| Corporate and other          | 60 |  |   | 21 |  |   | 21 |  |   | 47 |  |   | 34 |  |   | 2 |  |
| Total                        | $ | 2,085 |  |   | $ | 1,698 |  |   | $ | 2,910 |  |   | $ | 1,568 |  |   | $ | 2,461 |  |   | $ | 1,321 |  |

|                              |
|------------------------------|
|                              |  |  |  |  |  |  |  |
|                         | Capital Expenditures |
|                         | Increase/(decrease) |
| Segments                     | 2012 |   | 2011 |
| North America                | $ | (40 | ) |   | $ | (31 | ) |
| Latin America                | (12 | ) |   | (9 | ) |
| Europe/Africa/Russia Caspian | (16 | ) |   | (12 | ) |
| Middle East/Asia Pacific     | (13 | ) |   | (10 | ) |
| Industrial Services          | (523 | ) |   | (289 | ) |
| Shared assets                | 604 |  |   | 351 |  |
| Total                        | $ | — |  |   | $ | — |  |

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Table of Contents

|                              |
|------------------------------|
|                              |  |  |  |  |  |  |  |  |  |  |  |
|                         | 2013 |   | 2012 |   | 2011 |
| U.S.                         | $ | 10,133 |  |   | $ | 9,903 |  |   | $ | 9,131 |  |
| Canada and other             | 1,446 |  |   | 1,598 |  |   | 1,768 |  |
| North America                | 11,579 |  |   | 11,501 |  |   | 10,899 |  |
| Latin America (1)            | 2,368 |  |   | 2,436 |  |   | 2,220 |  |
| Europe/Africa/Russia Caspian | 4,162 |  |   | 3,981 |  |   | 3,671 |  |
| Middle East/Asia Pacific     | 4,255 |  |   | 3,443 |  |   | 3,041 |  |
| Total                        | $ | 22,364 |  |   | $ | 21,361 |  |   | $ | 19,831 |  |

|                           |
|---------------------------|
|                           |  |  |  |  |  |  |  |  |  |  |  |
|                 | 2013 |   | 2012 |   | 2011 |
| Completion and Production | $ | 13,323 |  |   | $ | 12,949 |  |   | $ | 12,469 |  |
| Drilling and Evaluation   | 7,762 |  |   | 7,195 |  |   | 6,224 |  |
| Industrial Services       | 1,279 |  |   | 1,217 |  |   | 1,138 |  |
| Total                     | $ | 22,364 |  |   | $ | 21,361 |  |   | $ | 19,831 |  |

|                              |
|------------------------------|
|                              |  |  |  |  |  |  |  |  |  |  |  |
|                         | 2013 |   | 2012 |   | 2011 |
| U.S.                         | $ | 4,582 |  |   | $ | 4,627 |  |   | $ | 3,752 |  |
| Canada and other             | 571 |  |   | 642 |  |   | 529 |  |
| North America                | 5,153 |  |   | 5,269 |  |   | 4,281 |  |
| Latin America (1)            | 887 |  |   | 912 |  |   | 891 |  |
| Europe/Africa/Russia Caspian | 1,734 |  |   | 1,419 |  |   | 1,325 |  |
| Middle East/Asia Pacific     | 1,302 |  |   | 1,107 |  |   | 918 |  |
| Total                        | $ | 9,076 |  |   | $ | 8,707 |  |   | $ | 7,415 |  |

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Table of Contents

|                                                |
|------------------------------------------------|
|                                                |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
|                                           | U.S. Pension Benefits |   | Non-U.S. Pension Benefits |   | Other PostretirementBenefits |
|                                      | 2013 |   | 2012 |   | 2013 |   | 2012 |   | 2013 |   | 2012 |
| Change in benefit obligation:                  |   |   |   |   |   |   |   |   |   |   |   |
| Benefit obligation at beginning of year        | $ | 589 |  |   | $ | 524 |  |   | $ | 740 |  |   | $ | 643 |  |   | $ | 148 |  |   | $ | 196 |  |
| Service cost                                   | 65 |  |   | 63 |  |   | 12 |  |   | 8 |  |   | 6 |  |   | 13 |  |
| Interest cost                                  | 21 |  |   | 21 |  |   | 31 |  |   | 32 |  |   | 5 |  |   | 7 |  |
| Actuarial loss (gain)                          | 2 |  |   | 20 |  |   | 36 |  |   | 76 |  |   | (22 | ) |   | 16 |  |
| Benefits paid                                  | (24 | ) |   | (34 | ) |   | (24 | ) |   | (22 | ) |   | (9 | ) |   | (15 | ) |
| Plan amendments                                | — |  |   | — |  |   | — |  |   | 9 |  |   | — |  |   | (69 | ) |
| Curtailment/settlements                        | — |  |   | — |  |   | (3 | ) |   | (23 | ) |   | — |  |   | — |  |
| Other                                          | (4 | ) |   | (5 | ) |   | — |  |   | (8 | ) |   | — |  |   | — |  |
| Foreign currency translation adjustments       | — |  |   | — |  |   | 7 |  |   | 25 |  |   | — |  |   | — |  |
| Benefit obligation at end of year              | 649 |  |   | 589 |  |   | 799 |  |   | 740 |  |   | 128 |  |   | 148 |  |
|                                           |   |   |   |   |   |   |   |   |   |   |   |
| Change in plan assets:                         |   |   |   |   |   |   |   |   |   |   |   |
| Fair value of plan assets at beginning of year | 524 |  |   | 433 |  |   | 592 |  |   | 526 |  |   | — |  |   | — |  |
| Actual return on plan assets                   | 78 |  |   | 53 |  |   | 52 |  |   | 43 |  |   | — |  |   | — |  |
| Employer contributions                         | 43 |  |   | 76 |  |   | 18 |  |   | 44 |  |   | 9 |  |   | 15 |  |
| Benefits paid                                  | (24 | ) |   | (34 | ) |   | (24 | ) |   | (22 | ) |   | (9 | ) |   | (15 | ) |
| Curtailment/settlements                        | — |  |   | — |  |   | (2 | ) |   | (23 | ) |   | — |  |   | — |  |
| Other                                          | (4 | ) |   | (4 | ) |   | — |  |   | — |  |   | — |  |   | — |  |
| Foreign currency translation adjustments       | — |  |   | — |  |   | 9 |  |   | 24 |  |   | — |  |   | — |  |
| Fair value of plan assets at end of year       | 617 |  |   | 524 |  |   | 645 |  |   | 592 |  |   | — |  |   | — |  |
|                                           |   |   |   |   |   |   |   |   |   |   |   |
| Funded status - underfunded at end of year     | $ | (32 | ) |   | $ | (65 | ) |   | $ | (154 | ) |   | $ | (148 | ) |   | $ | (128 | ) |   | $ | (148 | ) |
|                                           |   |   |   |   |   |   |   |   |   |   |   |
| Accumulated benefit obligation                 | $ | 599 |  |   | $ | 540 |  |   | $ | 767 |  |   | $ | 700 |  |   | $ | 128 |  |   | $ | 148 |  |

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Table of Contents

|                        |
|------------------------|
|                        |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
|                   | U.S. Pension Benefits |   | Non-U.S. Pension Benefits |   | Other PostretirementBenefits |
|              | 2013 |   | 2012 |   | 2013 |   | 2012 |   | 2013 |   | 2012 |
| Noncurrent assets      | $ | — |  |   | $ | — |  |   | $ | 12 |  |   | $ | 2 |  |   | $ | — |  |   | $ | — |  |
| Current liabilities    | (2 | ) |   | (2 | ) |   | (7 | ) |   | (8 | ) |   | (14 | ) |   | (15 | ) |
| Noncurrent liabilities | (30 | ) |   | (63 | ) |   | (159 | ) |   | (142 | ) |   | (114 | ) |   | (133 | ) |
| Net amount recognized  | $ | (32 | ) |   | $ | (65 | ) |   | $ | (154 | ) |   | $ | (148 | ) |   | $ | (128 | ) |   | $ | (148 | ) |

|                                |
|--------------------------------|
|                                |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
|                           | U.S. Pension Benefits |   | Non-U.S. Pension Benefits |   | Other PostretirementBenefits |
|                      | 2013 |   | 2012 |   | 2013 |   | 2012 |   | 2013 |   | 2012 |
| Projected benefit obligation   | $ | 18 |  |   | $ | 19 |  |   | $ | 399 |  |   | $ | 395 |  |   | n/a |  |   | n/a |  |
| Accumulated benefit obligation | $ | 17 |  |   | $ | 19 |  |   | $ | 371 |  |   | $ | 366 |  |   | $ | 128 |  |   | $ | 148 |  |
| Fair value of plan assets      | $ | — |  |   | $ | — |  |   | $ | 237 |  |   | $ | 255 |  |   | n/a |  |   | n/a |  |

|                               |
|-------------------------------|
|                               |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
|                          | U.S. Pension Benefits |   | Non-U.S. Pension Benefits |   | Other PostretirementBenefits |
|                     | 2013 |   | 2012 |   | 2013 |   | 2012 |   | 2013 |   | 2012 |
| Discount rate                 | 4.5 | % |   | 3.6 | % |   | 4.4 | % |   | 4.4 | % |   | 4.0 | % |   | 3.2 | % |
| Rate of compensation increase | 5.6 | % |   | 5.6 | % |   | 4.4 | % |   | 4.4 | % |   | n/a |  |   | n/a |  |
| Social security increase      | 2.8 | % |   | 2.8 | % |   | 2.4 | % |   | 2.1 | % |   | n/a |  |   | n/a |  |

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Table of Contents

|                                 |
|---------------------------------|
|                                 |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
|                            | U.S. Pension Benefits |   | Non-U.S. Pension Benefits |   | Other PostretirementBenefits |
|                       | 2013 |   | 2012 |   | 2013 |   | 2012 |   | 2013 |   | 2012 |
| Net actuarial loss              | $ | 156 |  |   | $ | 205 |  |   | $ | 209 |  |   | $ | 193 |  |   | $ | 27 |  |   | $ | 53 |  |
| Net prior service cost (credit) | 1 |  |   | 2 |  |   | 3 |  |   | 9 |  |   | (87 | ) |   | (95 | ) |
| Total                           | $ | 157 |  |   | $ | 207 |  |   | $ | 212 |  |   | $ | 202 |  |   | $ | (60 | ) |   | $ | (42 | ) |

|                                      |
|--------------------------------------|
|                                      |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
|                                 | U.S. Pension Benefits |   | Non-U.S. Pension Benefits |   | Other PostretirementBenefits |
|                            | 2013 |   | 2012 |   | 2011 |   | 2013 |   | 2012 |   | 2011 |   | 2013 |   | 2012 |   | 2011 |
| Service cost                         | $ | 65 |  |   | $ | 63 |  |   | $ | 38 |  |   | $ | 12 |  |   | $ | 8 |  |   | $ | 9 |  |   | $ | 6 |  |   | $ | 13 |  |   | $ | 8 |  |
| Interest cost                        | 21 |  |   | 21 |  |   | 21 |  |   | 31 |  |   | 32 |  |   | 33 |  |   | 5 |  |   | 7 |  |   | 8 |  |
| Expected return on plan assets       | (39 | ) |   | (35 | ) |   | (31 | ) |   | (37 | ) |   | (36 | ) |   | (33 | ) |   | — |  |   | — |  |   | — |  |
| Amortization of prior service credit | — |  |   | — |  |   | — |  |   | — |  |   | — |  |   | — |  |   | (7 | ) |   | (2 | ) |   | (2 | ) |
| Amortization of net actuarial loss   | 13 |  |   | 15 |  |   | 10 |  |   | 8 |  |   | 6 |  |   | 4 |  |   | 2 |  |   | 1 |  |   | — |  |
| Curtailment/settlements              | — |  |   | — |  |   | — |  |   | 2 |  |   | 4 |  |   | (4 | ) |   | — |  |   | — |  |   | — |  |
| Net periodic cost                    | $ | 60 |  |   | $ | 64 |  |   | $ | 38 |  |   | $ | 16 |  |   | $ | 14 |  |   | $ | 9 |  |   | $ | 6 |  |   | $ | 19 |  |   | $ | 14 |  |

|                                          |
|------------------------------------------|
|                                          |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
|                                     | U.S. Pension Benefits |   | Non-U.S. Pension Benefits |   | Other Postretirement Benefits |
|                                | 2013 |   | 2012 |   | 2011 |   | 2013 |   | 2012 |   | 2011 |   | 2013 |   | 2012 |   | 2011 |
| Discount rate                            | 3.6 | % |   | 4.2 | % |   | 4.9 | % |   | 4.4 | % |   | 5.0 | % |   | 5.5 | % |   | 3.2 | % |   | 3.8 | % |   | 4.9 | % |
| Expected long-term return on plan assets | 7.4 | % |   | 7.4 | % |   | 7.8 | % |   | 6.5 | % |   | 6.7 | % |   | 6.7 | % |   | n/a |  |   | n/a |  |   | n/a |  |
| Rate of compensation increase            | 5.6 | % |   | 5.4 | % |   | 5.4 | % |   | 4.4 | % |   | 4.4 | % |   | 4.3 | % |   | n/a |  |   | n/a |  |   | n/a |  |
| Social security increase                 | 2.8 | % |   | 2.8 | % |   | 2.8 | % |   | 2.1 | % |   | 2.1 | % |   | 2.9 | % |   | n/a |  |   | n/a |  |   | n/a |  |

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Table of Contents

|                                                         |
|---------------------------------------------------------|
|                                                         |  |  |  |  |  |  |  |
|                                                    | One PercentagePoint Increase |   | One PercentagePoint Decrease |
| Effect on total of service and interest cost components | $ | 0.2 |  |   | $ | (0.2 | ) |
| Effect on postretirement welfare benefit obligation     | $ | 4.1 |  |   | $ | (4.1 | ) |

|         |                                                                                             |
|---------|---------------------------------------------------------------------------------------------|
| • | Level One:  The use of quoted prices in active markets for identical financial instruments. |

|         |                                                                                                                                                                                                                                                                         |
|---------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| • | Level Two:  The use of quoted prices for similar instruments in active markets or quoted prices for identical or similar instruments in markets that are not active or other inputs that are observable in the market or can be corroborated by observable market data. |

|         |                                                                                                                                                                                   |
|---------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| • | Level Three:  The use of significantly unobservable inputs that typically require the use of management's estimates of assumptions that market participants would use in pricing. |

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Table of Contents

|                                     |
|-------------------------------------|
|                                     |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
|                                | 2013 |   | 2012 |
| Asset Category                      | TotalAssetValue |   | LevelOne |   | LevelTwo |   | LevelThree |   | TotalAssetValue |   | LevelOne |   | LevelTwo |   | LevelThree |
| Cash and Cash Equivalents           | $ | 5 |  |   | $ | 4 |  |   | $ | 1 |  |   | $ | — |  |   | $ | 3 |  |   | $ | — |  |   | $ | 3 |  |   | $ | — |  |
| Fixed Income (1)                    | 111 |  |   | — |  |   | 111 |  |   | — |  |   | 101 |  |   | — |  |   | 101 |  |   | — |  |
| Non-U.S. Equity (2)                 | 132 |  |   | — |  |   | 132 |  |   | — |  |   | 111 |  |   | — |  |   | 111 |  |   | — |  |
| U.S. Equity (3)                     | 148 |  |   | — |  |   | 148 |  |   | — |  |   | 106 |  |   | — |  |   | 106 |  |   | — |  |
| Hedge Funds (4)                     | 190 |  |   | — |  |   | — |  |   | 190 |  |   | 172 |  |   | — |  |   | — |  |   | 172 |  |
| Real Estate Funds (5)               | 9 |  |   | — |  |   | — |  |   | 9 |  |   | 7 |  |   | — |  |   | — |  |   | 7 |  |
| Real Estate Investment Trust Equity | 6 |  |   | — |  |   | 6 |  |   | — |  |   | 8 |  |   | — |  |   | 8 |  |   | — |  |
| Private Equity Fund (6)             | 16 |  |   | — |  |   | — |  |   | 16 |  |   | 16 |  |   | — |  |   | — |  |   | 16 |  |
| Total                               | $ | 617 |  |   | $ | 4 |  |   | $ | 398 |  |   | $ | 215 |  |   | $ | 524 |  |   | $ | — |  |   | $ | 329 |  |   | $ | 195 |  |

|           |                                                                                                                                                                                                                                                                                                                                                     |
|-----------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| (1)  | A multi-manager strategy investing in fixed income securities.  The current allocation includes:  40% in corporate bonds; 20% in government agencies; 15% in government bonds; 15% in government mortgage-backed securities; 5% in municipal bonds; 3% in asset-backed securities; and 2% in cash and other securities. |

|           |                                                                                                                        |
|-----------|------------------------------------------------------------------------------------------------------------------------|
| (2)  | Multi-manager strategy investing in common stocks of non-U.S. listed companies using both value and growth approaches. |

|           |                                                                                                               |
|-----------|---------------------------------------------------------------------------------------------------------------|
| (3)  | Multi-manager strategy investing in common stocks of U.S. listed companies using value and growth approaches. |

|           |                                                                                                                       |
|-----------|-----------------------------------------------------------------------------------------------------------------------|
| (4)  | Strategies taking long and short positions in equities, fixed income securities, currencies and derivative contracts. |

|           |                                                                                                                |
|-----------|----------------------------------------------------------------------------------------------------------------|
| (5)  | Strategy investing in the global private real estate secondary market using a value-based investment approach. |

|           |                                                                                                                          |
|-----------|--------------------------------------------------------------------------------------------------------------------------|
| (6)  | Partnership making opportunistic investments on a global basis across asset classes, capital structures and geographies. |

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Table of Contents

|                                 |
|---------------------------------|
|                                 |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
|                            | 2013 |   | 2012 |
| Asset Category                  | TotalAssetValue |   | LevelOne |   | LevelTwo |   | LevelThree |   | TotalAssetValue |   | LevelOne |   | LevelTwo |   | LevelThree |
| Cash and Cash Equivalents       | $ | 1 |  |   | $ | 1 |  |   | $ | — |  |   | $ | — |  |   | $ | 14 |  |   | $ | 14 |  |   | $ | — |  |   | $ | — |  |
| Asset Allocation (1)            | 125 |  |   | — |  |   | 125 |  |   | — |  |   | 136 |  |   | — |  |   | 136 |  |   | — |  |
| Bonds - Canada - Government (2) | 32 |  |   | 32 |  |   | — |  |   | — |  |   | — |  |   | — |  |   | — |  |   | — |  |
| Bonds - U.K. - Corporate (3)    | 79 |  |   | — |  |   | 79 |  |   | — |  |   | 72 |  |   | — |  |   | 72 |  |   | — |  |
| Bonds - U.K. - Government (4)   | 200 |  |   | — |  |   | 200 |  |   | — |  |   | 170 |  |   | — |  |   | 170 |  |   | — |  |
| Equities (5)                    | 169 |  |   | — |  |   | 169 |  |   | — |  |   | 164 |  |   | — |  |   | 164 |  |   | — |  |
| Real Estate Fund (6)            | 21 |  |   | — |  |   | — |  |   | 21 |  |   | 20 |  |   | — |  |   | — |  |   | 20 |  |
| Insurance contracts             | 18 |  |   | — |  |   | — |  |   | 18 |  |   | 16 |  |   | — |  |   | — |  |   | 16 |  |
| Total                           | $ | 645 |  |   | $ | 33 |  |   | $ | 573 |  |   | $ | 39 |  |   | $ | 592 |  |   | $ | 14 |  |   | $ | 542 |  |   | $ | 36 |  |

|           |                                                                                      |
|-----------|--------------------------------------------------------------------------------------|
| (1)  | Invests in mixes of global common stocks and bonds to achieve broad diversification. |

|           |                                                                                                                    |
|-----------|--------------------------------------------------------------------------------------------------------------------|
| (2)  | Invests in Canadian Dollar-denominated government issued bonds intended to match the duration of plan liabilities. |

|           |                                                                                           |
|-----------|-------------------------------------------------------------------------------------------|
| (3)  | Invests passively in British Pound Sterling-denominated investment grade corporate bonds. |

|           |                                                                                  |
|-----------|----------------------------------------------------------------------------------|
| (4)  | Invests passively in British Pound Sterling-denominated government issued bonds. |

|           |                                                                                                                                                                                                                                                                    |
|-----------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| (5)  | Invests in broad equity funds based on securities offered in various regions or countries.  Equity funds are allocated by region as follows:  57% Global; 15% U.K.; 9% Emerging Markets; 7% North America; 6% Asia Pacific; and 6% Europe. |

|           |                                                                                                                                     |
|-----------|-------------------------------------------------------------------------------------------------------------------------------------|
| (6)  | Invests in a diversified range of property throughout the U.K., principally in the retail, office and industrial/warehouse sectors. |

|                              |
|------------------------------|
|                              |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
|                         | U.S.Private EquityFund |   | U.S.Real EstateFund |   | U.S.HedgeFunds |   | Non-U.S.Real EstateFund |   | Non-U.S.InsuranceContracts |   | Total |
| Balance at December 31, 2010 | $ | — |  |   | $ | 14 |  |   | $ | — |  |   | $ | 19 |  |   | $ | 16 |  |   | $ | 49 |  |
| Unrealized gains             | — |  |   | 2 |  |   | — |  |   | — |  |   | — |  |   | 2 |  |
| Sales                        | — |  |   | (15 | ) |   | — |  |   | — |  |   | (2 | ) |   | (17 | ) |
| Purchases                    | — |  |   | 4 |  |   | 110 |  |   | — |  |   | 1 |  |   | 115 |  |
| Balance at December 31, 2011 | — |  |   | 5 |  |   | 110 |  |   | 19 |  |   | 15 |  |   | 149 |  |
| Unrealized (losses) gains    | (2 | ) |   | — |  |   | 10 |  |   | 1 |  |   | 4 |  |   | 13 |  |
| Sales                        | — |  |   | — |  |   | — |  |   | — |  |   | (5 | ) |   | (5 | ) |
| Purchases                    | 18 |  |   | 2 |  |   | 52 |  |   | — |  |   | 2 |  |   | 74 |  |
| Balance at December 31, 2012 | 16 |  |   | 7 |  |   | 172 |  |   | 20 |  |   | 16 |  |   | 231 |  |
| Unrealized gains             | 2 |  |   | — |  |   | 12 |  |   | 1 |  |   | 2 |  |   | 17 |  |
| Realized gains               | — |  |   | — |  |   | 7 |  |   | — |  |   | — |  |   | 7 |  |
| Sales                        | (10 | ) |   | — |  |   | (84 | ) |   | — |  |   | (2 | ) |   | (96 | ) |
| Purchases                    | 8 |  |   | 2 |  |   | 83 |  |   | — |  |   | 2 |  |   | 95 |  |
| Balance at December 31, 2013 | $ | 16 |  |   | $ | 9 |  |   | $ | 190 |  |   | $ | 21 |  |   | $ | 18 |  |   | $ | 254 |  |

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|           |
|-----------|
|           |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
| Year      | U.S. PensionBenefits | Non-U.S. PensionBenefits | Other PostretirementBenefits |
| 2014      |   | $ | 36 |  |   |   | $ | 20 |  |   |   | $ | 14 |  |   |
| 2015      |   | $ | 40 |  |   |   | $ | 20 |  |   |   | $ | 14 |  |   |
| 2016      |   | $ | 43 |  |   |   | $ | 23 |  |   |   | $ | 13 |  |   |
| 2017      |   | $ | 48 |  |   |   | $ | 28 |  |   |   | $ | 13 |  |   |
| 2018      |   | $ | 51 |  |   |   | $ | 30 |  |   |   | $ | 13 |  |   |
| 2019-2023 |   | $ | 308 |  |   |   | $ | 190 |  |   |   | $ | 61 |  |   |

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|                                                                 |
|-----------------------------------------------------------------|
|                                                                 |  |  |  |  |  |  |  |  |  |
|                                                            | Pensions and OtherPostretirementBenefits | ForeignCurrencyTranslationAdjustments | AccumulatedOtherComprehensiveLoss |
| Balance at December 31, 2011                                    | $ | (251 | ) | $ | (304 | ) | $ | (555 | ) |
| Other comprehensive income before reclassifications:            |   |   |   |
| Foreign currency translation adjustments                        |   | 78 |  | 78 |  |
| Pensions and other postretirement benefits:                     |   |   |   |
| Actuarial net loss arising in the year                          | (66 | ) |   | (66 | ) |
| Plan amendments                                                 | 60 |  |   | 60 |  |
| Foreign currency translation adjustments                        | (4 | ) |   | (4 | ) |
| Deferred taxes                                                  | (6 | ) |   | (6 | ) |
|                                                            |   |   |   |
| Amounts reclassified from accumulated other comprehensive loss: |   |   |  |  |
| Amortization of net actuarial loss                              | 22 |  |   | 22 |  |
| Amortization of prior service credit                            | (2 | ) |   | (2 | ) |
| Curtailment/settlements                                         | 4 |  |   | 4 |  |
| Deferred taxes                                                  | (7 | ) |   | (7 | ) |
| Balance at December 31, 2012                                    | (250 | ) | (226 | ) | (476 | ) |
| Other comprehensive income before reclassifications:            |   |   |  |  |
| Foreign currency translation adjustments                        |   | (61 | ) | (61 | ) |
| Pensions and other postretirement benefits:                     |   |   |  |  |
| Actuarial net gain arising in the year                          | 38 |  |   | 38 |  |
| Deferred taxes                                                  | (17 | ) |   | (17 | ) |
|                                                            |   |   |   |
| Amounts reclassified from accumulated other comprehensive loss: |   |   |   |
| Amortization of net actuarial loss                              | 23 |  |   | 23 |  |
| Amortization of prior service credit                            | (7 | ) |   | (7 | ) |
| Curtailment/settlements                                         | 2 |  |   | 2 |  |
| Deferred taxes                                                  | (6 | ) |   | (6 | ) |
| Balance at December 31, 2013                                    | $ | (217 | ) | $ | (287 | ) | $ | (504 | ) |

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|                                                         |
|---------------------------------------------------------|
|                                                         |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
|                                                    | FirstQuarter |   | SecondQuarter |   | Third Quarter |   | Fourth Quarter |   | TotalYear |
| 2013                                                    |   |   |   |   |   |   |   |   |   |
| Revenue                                                 | $ | 5,230 |  |   | $ | 5,487 |  |   | $ | 5,787 |  |   | $ | 5,860 |  |   | $ | 22,364 |  |
| Gross Profit (1)                                        | 777 |  |   | 765 |  |   | 895 |  |   | 818 |  |   | 3,255 |  |
| Net income attributable to Baker Hughes                 | 267 |  |   | 240 |  |   | 341 |  |   | 248 |  |   | 1,096 |  |
| Basic earnings per share attributable to Baker Hughes   | 0.60 |  |   | 0.54 |  |   | 0.77 |  |   | 0.56 |  |   | 2.47 |  |
| Diluted earnings per share attributable to Baker Hughes | 0.60 |  |   | 0.54 |  |   | 0.77 |  |   | 0.56 |  |   | 2.47 |  |
| Dividends per share                                     | 0.15 |  |   | 0.15 |  |   | 0.15 |  |   | 0.15 |  |   | 0.60 |  |
| Common stock market prices:                             |   |   |   |   |   |   |   |   |   |
| High                                                    | 47.96 |  |   | 48.22 |  |   | 50.38 |  |   | 58.66 |  |   |   |
| Low                                                     | 42.01 |  |   | 43.21 |  |   | 46.22 |  |   | 48.64 |  |   |   |
|                                                    |   |   |   |   |   |   |   |   |   |
| 2012                                                    |   |   |   |   |   |   |   |   |   |
| Revenue                                                 | $ | 5,355 |  |   | $ | 5,326 |  |   | $ | 5,355 |  |   | $ | 5,325 |  |   | $ | 21,361 |  |
| Gross Profit (1)                                        | 966 |  |   | 944 |  |   | 841 |  |   | 757 |  |   | 3,508 |  |
| Net income attributable to Baker Hughes                 | 379 |  |   | 439 |  |   | 279 |  |   | 214 |  |   | 1,311 |  |
| Basic earnings per share attributable to Baker Hughes   | 0.86 |  |   | 1.00 |  |   | 0.63 |  |   | 0.49 |  |   | 2.98 |  |
| Diluted earnings per share attributable to Baker Hughes | 0.86 |  |   | 1.00 |  |   | 0.63 |  |   | 0.49 |  |   | 2.97 |  |
| Dividends per share                                     | 0.15 |  |   | 0.15 |  |   | 0.15 |  |   | 0.15 |  |   | 0.60 |  |
| Common stock market prices:                             |   |   |   |   |   |   |   |   |   |
| High                                                    | 52.40 |  |   | 44.76 |  |   | 50.10 |  |   | 47.10 |  |   |   |
| Low                                                     | 40.79 |  |   | 38.13 |  |   | 38.85 |  |   | 39.64 |  |   |   |

|           |                                                                                       |
|-----------|---------------------------------------------------------------------------------------|
| (1)  | Represents revenue less cost of sales, cost of services and research and engineering. |

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|                                                                     |
|---------------------------------------------------------------------|
|                                                                     |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
| Equity Compensation PlanCategory                                    | Number ofSecurities to beIssued UponExercise ofOutstandingOptions, Warrantsand Rights |   | Weighted AverageExercise Price ofOutstandingOptions, Warrantsand Rights |   | Number of SecuritiesRemaining Availablefor Future IssuanceUnder EquityCompensation Plans(excluding securitiesreflected in the firstcolumn) |
| Stockholder-approved plans (excluding Employee Stock Purchase Plan) |   | 12.1 |  |   |   |   | $ | 50.57 |  |   |   |   | 1.5 |  |   |
| Nonstockholder-approved plans (1)                                   |   | 0.1 |  |   |   |   | 46.72 |  |   |   |   | 0.5 |  |   |
| Subtotal (except for weighted average exercise price)               |   | 12.2 |  |   |   |   | 50.57 |  |   |   |   | 2.0 |  |   |
| Employee Stock Purchase Plan (2)                                    |   | — |  |   |   |   | — |  |   |   |   | 7.8 |  |   |
| Total                                                               |   | 12.2 |  |   |   |   | $ | 50.57 |  |   |   |   | 9.8 |  |   |

|     |                                                                                                                                                          |
|-----|----------------------------------------------------------------------------------------------------------------------------------------------------------|
| (1) | The table includes the following nonstockholder-approved plan:  the Director Compensation Deferral Plan.  A description of this plan is set forth below. |

|     |                                                                                                                                                                                                                                                                                      |
|-----|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| (2) | The per share purchase price under the Baker Hughes Incorporated Employee Stock Purchase Plan is determined in accordance with section 423 of the Code and is 85% of the lower of the fair market value of a share of our common stock on the date of grant or the date of purchase. |

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|        |
|--------|
|        |  |
| 3.1    | Certificate of Amendment dated April 22, 2010 and the Restated Certificate of Incorporation (filed as Exhibit 3.1 to the Quarterly Report of Baker Hughes Incorporated on Form 10-Q for the quarter ended March 31, 2010). |
|   |   |
| 3.2    | Restated Bylaws of Baker Hughes Incorporated effective as of October 24, 2013 (filed as Exhibit 3.1 to the Current Report of Baker Hughes Incorporated on Form 8-K filed October 25, 2013). |
|   |   |
| 4.1    | Rights of Holders of the Company’s Long-Term Debt.  The Company has no long-term debt instrument with regard to which the securities authorized there under equal or exceed 10% of the total assets of the Company and its subsidiaries on a consolidated basis.  The Company agrees to furnish a copy of its long-term debt instruments to the SEC upon request. |
|   |   |
| 4.2    | Certificate of Amendment dated April 22, 2010 and the Restated Certificate of Incorporation (filed as Exhibit 3.1 to the Quarterly Report of Baker Hughes Incorporated on Form 10-Q for the quarter ended March 31, 2010). |
|   |   |
| 4.3    | Restated Bylaws of Baker Hughes Incorporated effective as of October 24, 2013 (filed as Exhibit 3.1 to the Current Report of Baker Hughes Incorporated on Form 8-K filed October 25, 2013). |
|   |   |
| 4.4    | Indenture dated as of May 15, 1994 between Western Atlas Inc. and The Bank of New York, Trustee, providing for the issuance of securities in series (filed as Exhibit 4.4 to the Annual Report of Baker Hughes Incorporated on Form 10-K for the year ended December 31, 2004). |
|   |   |
| 4.5    | Indenture dated October 28, 2008, between Baker Hughes Incorporated and The Bank of New York Mellon Trust Company, N.A., as trustee (filed as Exhibit 4.1 to the Current Report of Baker Hughes Incorporated on Form 8-K filed October 29, 2008). |
|   |   |
| 4.6    | First Supplemental Indenture, dated August 17, 2011, between Baker Hughes Incorporated and The Bank of New York Mellon Trust Company, N.A., as trustee (including form of Notes) (filed as Exhibit 4.2 to the Current Report of Baker Hughes Incorporated on Form 8-K filed August 23, 2011). |
|   |   |
| 4.7    | Officers’ Certificate of Baker Hughes Incorporated dated October 28, 2008 establishing the 6.50% Senior Notes due 2013 and the 7.50% Senior Notes due 2018 (filed as Exhibit 4.2 to the Current Report of Baker Hughes Incorporated on Form 8-K filed October 29, 2008). |
|   |   |
| 4.8    | Form of 7.50% Senior Notes Due 2018 (filed as Exhibit 4.4 to the Current Report of Baker Hughes Incorporated on Form 8-K filed October 29, 2008). |
|   |   |
| 4.9    | Officers’ Certificate of Baker Hughes Incorporated dated August 24, 2010 establishing the 5.125% Senior Notes due 2040 (filed as Exhibit 4.2 to the Current Report of Baker Hughes Incorporated on Form 8-K filed August 24, 2010). |
|   |   |
| 4.10   | Form of 5.125% Senior Notes due 2040 (filed as Exhibit 4.3 to the Current Report of Baker Hughes Incorporated on Form 8-K filed August 24, 2010). |
|   |   |

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|         |
|---------|
|         |  |
| 4.11    | Indenture, dated June 8, 2006, between BJ Services Company, as issuer, and Wells Fargo Bank, N.A., as trustee (filed as Exhibit 4.1 to the Current Report of BJ Services Company on Form 8-K filed on June 12, 2006). |
|    |   |
| 4.12    | Third Supplemental Indenture, dated May 19, 2008, between BJ Services Company, as issuer, and Wells Fargo Bank, N.A., as trustee, with respect to the 6% Senior Notes due 2018 (filed as Exhibit 4.2 to the Current Report of BJ Services Company on Form 8-K filed on May 23, 2008). |
|    |   |
| 4.13    | Fourth Supplemental Indenture, dated April 28, 2010, between BJ Services Company, as issuer, BSA Acquisition LLC, Baker Hughes Incorporated and Wells Fargo Bank, N.A., as trustee, with respect to the 5.75% Senior Notes due 2011 and the 6% Senior Notes due 2018 (filed as Exhibit 4.4 to the Current Report of Baker Hughes Incorporated on Form 8-K filed on April 29, 2010). |
|    |   |
| 4.14    | Fifth Supplemental Indenture, dated June 21, 2011, between BJ Services Company LLC, as company, Western Atlas Inc. as successor company and Wells Fargo Bank, N.A., as trustee, with respect to the 6.00% Senior Notes due 2018 (incorporated by reference to Exhibit 4.4 to the Current Report of Baker Hughes Incorporated on Form 8-K filed on June 23, 2011). |
|    |   |
| 4.15+   | Form of Incentive Stock Option Assumption Agreement for BJ Services incentive plans (filed as Exhibit 4.5 to the Current Report of Baker Hughes Incorporated on Form 8-K filed on April 29, 2010). |
|    |   |
| 4.16+   | Form of Nonqualified Stock Option Assumption Agreement for BJ Services incentive plans (filed as Exhibit 4.6 to the Current Report of Baker Hughes Incorporated on Form 8-K filed on April 29, 2010). |
|    |   |
| 4.17    | Registration Rights Agreement dated August 17, 2011 among Baker Hughes Incorporated and J.P. Morgan Securities LLC and Merrill Lynch, Pierce, Fenner & Smith Incorporated, as representatives of the several initial purchasers named therein (filed as Exhibit 10.1 to the Current Report of Baker Hughes Incorporated on Form 8-K filed on August 23, 2011). |
|    |   |
| 10.1+   | Form of Amended and Restated Change in Control Agreement between Baker Hughes Incorporated and each of the executive officers effective as of January 1, 2009 (filed as Exhibit 10.2 to the Current Report of Baker Hughes Incorporated on Form 8-K filed December 19, 2008). |
|    |   |
| 10.2+   | Form of Change in Control Agreement between Baker Hughes Incorporated and certain of the executive officers effective as of July 16, 2012 (filed as Exhibit 10.1 to the Quarterly Report of Baker Hughes Incorporated on Form 10-Q for the quarter ended June 30, 2012). |
|    |   |
| 10.3+   | Form of Executive Loyalty, Confidentiality, Non-Solicitation, and Non-Competition Agreement between Baker Hughes Incorporated and certain of the executive officers (filed as Exhibit 10.3 to the Annual Report of Baker Hughes Incorporated on Form 10-K for the year ended December 31, 2011). |
|    |   |
| 10.4+*  | Letter Agreement between Baker Hughes Incorporated and Peter A. Ragauss dated December 8, 2013. |
|    |   |
| 10.5+   | Amendment and Restatement of the Baker Hughes Incorporated Change in Control Severance Plan effective as of January 1, 2009 (filed as Exhibit 10.3 to the Current Report of Baker Hughes Incorporated on Form 8-K filed December 19, 2008). |
|    |   |
| 10.6+   | Form of Indemnification Agreement between Baker Hughes Incorporated and each of the directors and executive officers (filed as Exhibit 10.4 to the Annual Report of Baker Hughes Incorporated on Form 10-K for the year ended December 31, 2003). |
|    |   |
| 10.7+   | Form of Amendment to the Indemnification Agreement between Baker Hughes Incorporated and each of the directors and executive officers effective as of January 1, 2009 (filed as Exhibit 10.4 to the Current Report of Baker Hughes Incorporated on Form 8-K filed December 19, 2008). |
|    |   |
| 10.8+   | Baker Hughes Incorporated Director Retirement Policy for Certain Members of the Board of Directors (filed as Exhibit 10.10 to the Annual Report of Baker Hughes Incorporated on Form 10-K for the year ended December 31, 2003). |
|    |   |
| 10.9+   | Baker Hughes Incorporated Director Compensation Deferral Plan, as amended and restated effective as of January 1, 2009 (filed as Exhibit 10.2 to the Quarterly Report of Baker Hughes Incorporated on Form 10-Q for the quarter ended June 30, 2008). |
|    |   |
| 10.10+  | Amendment to Baker Hughes Incorporated Director Compensation Deferral Plan effective as of January 1, 2009 (filed as Exhibit 10.5 to the Current Report of Baker Hughes Incorporated on Form 8-K filed on December 19, 2008). |
|    |   |
| 10.11+* | Amendment to the Baker Hughes Incorporated Director Compensation Deferral Plan effective as of July 25, 2013. |
|    |   |

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|        |
|--------|
|        |  |
| 10.12+ | Baker Hughes Incorporated Executive Severance Plan, as amended and restated on February 7, 2008 (filed as Exhibit 10.17 to the Annual Report of Baker Hughes Incorporated on Form 10-K for the year ended December 31, 2007). |
|   |   |
| 10.13+ | Amendment to Exhibit A of Baker Hughes Incorporated Executive Severance Plan as of July 20, 2009 (filed as Exhibit 10.1 to the Quarterly Report of Baker Hughes Incorporated on Form 10-Q for the quarter ended June 30, 2009). |
|   |   |
| 10.14+ | Amendment to Baker Hughes Incorporated Executive Severance Plan dated April 22, 2010 (filed as Exhibit 10.1 to the Current Report of Baker Hughes Incorporated on Form 8-K filed on April 23, 2010). |
|   |   |
| 10.15+ | Baker Hughes Incorporated Annual Incentive Compensation Plan for officers, as amended and restated on January 23, 2014 (filed as Exhibit 10.5 to the Current Report of Baker Hughes Incorporated on Form 8-K filed on January 28, 2014). |
|   |   |
| 10.16+ | Baker Hughes Incorporated Supplemental Retirement Plan, as amended and restated effective as of January 1, 2012 (filed as Exhibit 10.1 to the Current Report of Baker Hughes Incorporated on Form 8-K filed on December 20, 2011). |
|   |   |
| 10.17+ | Baker Hughes Incorporated 2002 Employee Long-Term Incentive Plan (filed as Exhibit 4.4 to the Registration Statement No. 333-87372 of Baker Hughes Incorporated on Form S-8 filed May 1, 2002). |
|   |   |
| 10.18+ | Amendment to Baker Hughes Incorporated 2002 Employee Long-Term Incentive Plan, effective July 24, 2008 (filed as Exhibit 10.4 to the Quarterly Report of Baker Hughes Incorporated on Form 10-Q for the quarter ended June 30, 2008). |
|   |   |
| 10.19+ | Amendment to Baker Hughes Incorporated 2002 Employee Long-Term Incentive Plan dated March 31, 2010 (filed as Annex H to the Registration Statement No. 333-162463 of Baker Hughes Incorporated on Form S-4 filed on February 9, 2010). |
|   |   |
| 10.20+ | Baker Hughes Incorporated 2002 Director & Officer Long-Term Incentive Plan (filed as Exhibit 10.2 to the Quarterly Report of Baker Hughes Incorporated on Form 10-Q for the quarter ended September 30, 2003). |
|   |   |
| 10.21+ | Amendment to 2002 Director & Officer Long-Term Incentive Plan, effective as of October 27, 2005 (filed as Exhibit 10.3 to the Quarterly Report of Baker Hughes Incorporated on Form 10-Q for the quarter ended September 30, 2005). |
|   |   |
| 10.22+ | Amendment to Baker Hughes Incorporated 2002 Director & Officer Long-Term Incentive Plan effective July 24, 2008 (filed as Exhibit 10.3 to the Quarterly Report of Baker Hughes Incorporated on Form 10-Q for the quarter ended June 30, 2008). |
|   |   |
| 10.23+ | Amendment to Baker Hughes Incorporated 2002 Director & Officer Long-Term Incentive Plan dated March 31, 2010 (filed as Annex G to the Registration Statement No. 333-162463 of Baker Hughes Incorporated on Form S-4 filed on February 9, 2010). |
|   |   |
| 10.24+ | Baker Hughes Incorporated Employee Stock Purchase Plan, as amended and restated, effective as of January 1, 2012 (filed as Exhibit 10.25 to the Annual Report of Baker Hughes Incorporated on Form 10-K for the year ending December 31, 2012). |
|   |   |
| 10.25+ | Amendment to the Baker Hughes Incorporated Employee Stock Purchase Plan effective as of April 25, 2013 (filed as Exhibit 10.2 to the Current Report of Baker Hughes Incorporated on Form 8-K filed on April 30, 2013). |
|   |   |
| 10.26+ | Form of Baker Hughes Incorporated Incentive Stock Option Agreement with Terms and Conditions for officers (filed as Exhibit 10.33 to the Annual Report of Baker Hughes Incorporated on Form 10-K for the year ended December 31, 2009). |
|   |   |
| 10.27+ | Form of Baker Hughes Incorporated Nonqualified Stock Option Agreement with Terms and Conditions for officers (filed as Exhibit 10.30 to the Annual Report of Baker Hughes Incorporated on Form 10-K for the year ended December 31, 2009). |
|   |   |
| 10.28+ | Form of Baker Hughes Incorporated Nonqualified Stock Option Award Agreement and Terms and Conditions for officers (filed as Exhibit 10.70 to the Annual Report of Baker Hughes Incorporated on Form 10-K for the year ended December 31, 2011). |
|   |   |
| 10.29+ | Form of Baker Hughes Incorporated Nonqualified Stock Option Award Agreement and Terms and Conditions for officers (filed as Exhibit 10.6 to the Current Report of Baker Hughes Incorporated on Form 8-K filed on January 28, 2014). |
|   |   |

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|        |
|--------|
|        |  |
| 10.30+ | Form of Baker Hughes Incorporated Incentive Stock Option Award Agreement and Terms and Conditions for officers (filed as Exhibit 10.71 to the Annual Report of Baker Hughes Incorporated on Form 10-K for the year ended December 31, 2011). |
|   |   |
| 10.31+ | Form of Baker Hughes Incorporated Incentive Stock Option Award Agreement and Terms and Conditions for officers (filed as Exhibit 10.7 to the Current Report of Baker Hughes Incorporated on Form 8-K filed on January 28, 2014). |
|   |   |
| 10.32+ | Form of Baker Hughes Incorporated Restricted Stock Award with Terms and Conditions for officers (filed as Exhibit 10.37 to the Annual Report of Baker Hughes Incorporated on Form 10-K for the year ended December 31, 2009). |
|   |   |
| 10.33+ | Form of Baker Hughes Incorporated Restricted Stock Unit Award Agreement and Terms and Conditions for officers (filed as Exhibit 10.41 to the Annual Report of Baker Hughes Incorporated on Form 10-K for the year ended December 31, 2009). |
|   |   |
| 10.34+ | Form of Baker Hughes Incorporated Restricted Stock Award, including Terms and Conditions for directors (filed as Exhibit 10.40 to the Annual Report of Baker Hughes Incorporated on Form 10-K for the year ended December 31, 2005). |
|   |   |
| 10.35+ | Form of Baker Hughes Incorporated Restricted Stock Unit Award Agreement and Terms and Conditions for officers (filed as Exhibit 10.9 to the Current Report of Baker Hughes Incorporated on Form 8-K filed on January 28, 2014). |
|   |   |
| 10.36+ | Form of Baker Hughes Incorporated Restricted Stock Award Agreement and Terms and Conditions for officers (filed as Exhibit 10.8 to the Current Report of Baker Hughes Incorporated on Form 8-K filed on January 28, 2014). |
|   |   |
| 10.37+ | Form of Baker Hughes Incorporated Restricted Stock Unit Award, including Terms and Conditions for directors (filed as Exhibit 10.34 to the Annual Report of Baker Hughes Incorporated on Form 10-K for the year ending December 31, 2012). |
|   |   |
| 10.38+ | Form of Baker Hughes Incorporated Stock Option Award Agreement, including Terms and Conditions for directors (filed as Exhibit 10.41 to the Annual Report of Baker Hughes Incorporated on Form 10-K for the year ended December 31, 2005). |
|   |   |
| 10.39+ | Form of Baker Hughes Incorporated Performance Unit Award Agreement and Terms and Conditions for officers (filed as Exhibit 10.72 to the Annual Report of Baker Hughes Incorporated on Form 10-K for the year ended December 31, 2011). |
|   |   |
| 10.40+ | Form of Baker Hughes Incorporated Performance Unit Award Agreement and Terms and Conditions for certain officers payable in cash (filed as Exhibit 10.3 to the Current Report of Baker Hughes Incorporated on Form 8-K filed on January 28, 2014). |
|   |   |
| 10.41+ | Form of Baker Hughes Incorporated Performance Unit Award Agreement and Terms and Conditions for certain officers payable in shares (filed as Exhibit 10.4 to the Current Report of Baker Hughes Incorporated on Form 8-K filed on January 28, 2014). |
|   |   |
| 10.42+ | Performance Goals adopted January 25, 2012 for the Performance Unit Awards granted in 2012 under the Baker Hughes Incorporated 2002 Director & Officer Long-Term Incentive Plan (filed as Exhibit 10.39 to the Annual Report of Baker Hughes Incorporated on Form 10-K filed on February 13, 2013). |
|   |   |
| 10.43+ | Performance Goals adopted February 27, 2013 for the Performance Unit Awards granted in 2013 under the Baker Hughes Incorporated 2002 Director & Officer Long-Term Incentive Plan and 2002 Employee Long-Term Incentive Plan (filed as Exhibit 10.1 to the Current Report of Baker Hughes Incorporated on Form 8-K filed on March 4, 2013). |
|   |   |
| 10.44+ | Performance Goals adopted January 22, 2014 for the Performance Unit Awards payable in cash granted in 2014 (filed as Exhibit 10.1 to the Current Report of Baker Hughes Incorporated on Form 8-K filed on January 28, 2014). |
|   |   |
| 10.45+ | Performance Goals adopted January 22, 2014 for the Performance Unit Awards payable in shares granted in 2014 (filed as Exhibit 10.2 to the Current Report of Baker Hughes Incorporated on Form 8-K filed on January 28, 2014). |
|   |   |
| 10.46+ | BJ Services Company 2000 Incentive Plan (filed as Appendix B to the Proxy Statement of BJ Services Company dated December 20, 2000). |
|   |   |
| 10.47+ | First Amendment effective March 22, 2001 to BJ Services Company 2000 Incentive Plan (filed as Exhibit 10.2 to the Registration Statement of BJ Services Company on Form S-8 (Reg. No. 333-73348). |

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Table of Contents

|          |
|----------|
|          |  |
|     |   |
| 10.48+   | Second Amendment effective May 10, 2001 to BJ Services Company 2000 Incentive Plan (filed as Appendix D to the Proxy Statement of BJ Services Company dated April 10, 2001). |
|     |   |
| 10.49+   | Third Amendment effective October 15, 2001 to BJ Services Company 2000 Incentive Plan (filed as Exhibit 10.24 to the Annual Report of BJ Services Company on Form 10-K for the year ended September 30, 2001). |
|     |   |
| 10.50+   | Fifth Amendment effective November 15, 2006 to BJ Services Company 2000 Incentive Plan (filed as Exhibit 10.4 to the Current Report of BJ Services Company on Form 8-K filed on December 13, 2006). |
|     |   |
| 10.51+   | Sixth Amendment effective October 13, 2008 to BJ Services Company 2000 Incentive Plan (filed as Exhibit 10.22 to the Annual Report of BJ Services Company on Form 10-K for the year ended September 30, 2008). |
|     |   |
| 10.52+   | Seventh Amendment effective December 5, 2008 to BJ Services Company 2000 Incentive Plan (filed as Exhibit 10.3 to the Quarterly Report of BJ Services Company on Form 10Q for the quarter ended December 31, 2008). |
|     |   |
| 10.53+   | Amended and Restated BJ Services Company 2003 Incentive Plan (filed as Appendix A to the Proxy Statement of BJ Services Company dated December 15, 2008). |
|     |   |
| 10.54+   | First Amendment to the Amended and Restated BJ Services Company 2003 Incentive Plan (filed as Exhibit 10.1 to the Quarterly Report of BJ Services Company for the quarter ended March 31, 2009). |
|     |   |
| 10.55+   | Baker Hughes Incorporated Compensation Recoupment Policy effective January 1, 2014 (filed as Exhibit 10.10 to the Current Report of Baker Hughes Incorporated on Form 8-K filed on January 28, 2014). |
|     |   |
| 10.56    | Credit Agreement dated as of September 13, 2011, among Baker Hughes Incorporated, JP Morgan Chase Bank, N.A., as Administrative Agent and twenty-one lenders for $2.5 billion, in the aggregate for all banks (filed as Exhibit 10.1 to the Current Report of Baker Hughes Incorporated on Form 8-K filed September 14, 2011). |
|     |   |
| 10.57    | Plea Agreement between Baker Hughes Services International, Inc. and the United States Department of Justice filed on April 26, 2007, with the United States District Court of Texas, Houston Division (filed as Exhibit 10.5 to the Quarterly Report of Baker Hughes Incorporated on Form 10-Q for the quarter ended March 31, 2007). |
|     |   |
| 21.1*    | Subsidiaries of Registrant. |
|     |   |
| 23.1*    | Consent of Deloitte & Touche LLP. |
|     |   |
| 31.1*    | Certification of Martin S. Craighead, Chairman and Chief Executive Officer, furnished pursuant to Rule 13a-14(a) of the Securities Exchange Act of 1934, as amended. |
|     |   |
| 31.2*    | Certification of Peter A. Ragauss, Chief Financial Officer, furnished pursuant to Rule 13a-14(a) of the Securities Exchange Act of 1934, as amended. |
|     |   |
| 32*      | Statement of Martin S. Craighead, Chairman and Chief Executive Officer, and Peter A. Ragauss, Chief Financial Officer, furnished pursuant to Rule 13a-14(b) of the Securities Exchange Act of 1934, as amended. |
|     |   |
| 95*      | Mine Safety Disclosures. |
|     |   |
| 101.INS* | XBRL Instance Document |
|     |   |
| 101.SCH* | XBRL Schema Document |
|     |   |
| 101.CAL* | XBRL Calculation Linkbase Document |
|     |   |
| 101.LAB* | XBRL Label Linkbase Document |
|     |   |
| 101.PRE* | XBRL Presentation Linkbase Document |
|     |   |
| 101.DEF* | XBRL Definition Linkbase Document |

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Table of Contents

|        |
|--------|
|        |  |  |  |
|   |   |   | BAKER HUGHES INCORPORATED |
|   |   |   |   |
| Date:  | February 12, 2014 |   | /s/ MARTIN S. CRAIGHEAD |
|   |   |   | Martin S. CraigheadChairman and Chief Executive Officer |

|                         |
|-------------------------|
|                         |  |  |
| Signature               |    | Title |
|                    |   |   |
| /S/ MARTIN S. CRAIGHEAD |    | Chairman and Chief Executive Officer |
| (Martin S. Craighead)   |    | (principal executive officer) |
|                    |   |   |
| /S/ PETER A. RAGAUSS    |    | Senior Vice President and Chief Financial Officer |
| (Peter A. Ragauss)      |    | (principal financial officer) |
|                    |   |   |
| /S/ ALAN J. KEIFER      |    | Vice President and Controller |
| (Alan J. Keifer)        |    | (principal accounting officer) |

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Table of Contents

|                              |
|------------------------------|
|                              |  |  |
| Signature                    |    | Title |
|                         |   |   |
| /S/ LARRY D. BRADY           |    | Director |
| (Larry D. Brady)             |    |   |
|                         |   |   |
| /S/ CLARENCE P. CAZALOT, JR. |    | Director |
| (Clarence P. Cazalot, Jr.)   |    |   |
|                         |   |   |
| /S/ LYNN L. ELSENHANS        |    | Director |
| (Lynn L. Elsenhans)          |   |   |
|                         |   |   |
| /S/ ANTHONY G. FERNANDES     |    | Director |
| (Anthony G. Fernandes)       |    |   |
|                         |   |   |
| /S/ CLAIRE W. GARGALLI       |    | Director |
| (Claire W. Gargalli)         |    |   |
|                         |   |   |
| /S/ PIERRE H. JUNGELS        |    | Director |
| (Pierre H. Jungels)          |    |   |
|                         |   |   |
| /S/ JAMES A. LASH            |    | Director |
| (James A. Lash)              |    |   |
|                         |   |   |
| /S/ J. LARRY NICHOLS         |    | Director |
| (J. Larry Nichols)           |    |   |
|                         |   |   |
| /S/ JAMES W. STEWART         |    | Director |
| (James W. Stewart)           |    |   |
|                         |   |   |
| /S/ CHARLES L. WATSON        |    | Director |
| (Charles L. Watson)          |    |   |

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Table of Contents

|                                          |
|------------------------------------------|
|                                          |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
| (In millions)                            | Balance atBeginningof Period |   | Charged toCost andExpenses |   | Write-offs (1) |   | OtherChanges (2) (3) |   | Balance atEnd ofPeriod |
| Year Ended December 31, 2013             |   |   |   |   |   |   |   |   |   |
| Reserve for doubtful accounts receivable | $ | 308 |  |   | $ | 75 |  |   | $ | (115 | ) |   | $ | (30 | ) |   | $ | 238 |  |
| Reserve for inventories                  | 346 |  |   | 85 |  |   | (46 | ) |   | (3 | ) |   | 382 |  |
| Year Ended December 31, 2012             |   |   |   |   |   |   |   |   |   |
| Reserve for doubtful accounts receivable | 229 |  |   | 100 |  |   | (22 | ) |   | 1 |  |   | 308 |  |
| Reserve for inventories                  | 304 |  |   | 68 |  |   | (28 | ) |   | 2 |  |   | 346 |  |
| Year Ended December 31, 2011             |   |   |   |   |   |   |   |   |   |
| Reserve for doubtful accounts receivable | 162 |  |   | 84 |  |   | (18 | ) |   | 1 |  |   | 229 |  |
| Reserve for inventories                  | 322 |  |   | 16 |  |   | (36 | ) |   | 2 |  |   | 304 |  |

|           |                                                                                                    |
|-----------|----------------------------------------------------------------------------------------------------|
| (1)  | Represents the elimination of accounts receivable and inventory deemed uncollectible or worthless. |

|           |                                                                          |
|-----------|--------------------------------------------------------------------------|
| (2)  | Represents transfers, currency translation adjustments and divestitures. |

|           |                                                                                                                                                                       |
|-----------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| (3)  | For the year ended December 31, 2013, the reserve for doubtful accounts receivable includes a $30 million reduction due to the currency devaluation in Venezuela. |