Document:

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                                                             [BAKER HUGHES LOGO]

                                                                   EXHIBIT 10.48

                            BAKER HUGHES INCORPORATED
                             STOCK OPTION AGREEMENT

                                  <<FULL_NAME>>

                                     GRANTEE

<TABLE>
<S>                               <C>
Date of Grant:                    JANUARY 26, 2005

Total Number of Shares Granted:   <<JAN_SO>>

Exercise Price per Share:         $42.60

Expiration Date:                  JANUARY 26, 2015

Term of Award; Vesting Schedule:  3 YEARS, WITH VESTING OF 33 1/3% ON THE ANNIVERSARY DATE OF THE
                                  DATE OF GRANT IN EACH OF THE YEARS 2006, 2007, AND 2008.

Other Terms of Award:             TERMS AND CONDITIONS ARE PROVIDED UPON REQUEST AND ARE LOCATED ON
                                  THE BHI INTRANET AT:
                                   HTTP://INTERCHANGE/HUMANRESOURCES/COMPENSATION
</TABLE>

                                 GRANT OF OPTION

Pursuant to action taken by the Compensation Committee of the Board of Directors
of Baker Hughes Incorporated, a Delaware corporation (the "Company"), for the
purposes of administration of the BAKER HUGHES INCORPORATED <<PLAN_NAME>> (the
"Plan"), the above-named Grantee is hereby granted <<Type>> stock option to
purchase the above number of shares of the Company's $1 par value per share
common stock at the exercise price stated above for each share subject to this
option, with the exercise price payable at the time of exercise. This option may
not be exercised after the Expiration Date.

By your acceptance of the option, you agree that the option is granted under and
governed by the terms of the Plan, this Stock Option Agreement and the Terms and
Conditions of Option Agreements (dated January 26, 2005).

                                              BAKER HUGHES INCORPORATED

                                              /s/ Chad C. Deaton
                                              ----------------------------------
                                              Chad C. Deaton - Chairman & CEO

<PAGE>
                            BAKER HUGHES INCORPORATED

                              TERMS AND CONDITIONS
                                       OF
                                OPTION AGREEMENTS
                               (JANUARY 26, 2005)

      These Terms and Conditions are applicable to options granted pursuant to
the Baker Hughes Incorporated [2002 Director & Officer Long-Term Incentive
Plan/2002 Employee Long-Term Incentive Plan] (the "Plan").

1.    TERMINATION OF EMPLOYMENT. The following provisions will apply in the
      event of Grantee's termination of employment:

      1.1   Termination Generally. If Grantee's employment is terminated for any
            reason other than

            (i)   a termination covered by Sections 1.2 through 1.6, or

            (ii)  a termination, within two years following a Change in Control
                  (as defined in the Plan) that occurs after the Date of Grant,
                  either (A) by the Company without Cause (as defined in the
                  Plan) or (B) by the Grantee for Good Reason (as defined in the
                  Plan),

      the option will wholly and completely terminate on the date of termination
      of employment, to the extent it is not then exercisable; however, to the
      extent the option is exercisable, Grantee shall have three years from the
      date of termination of employment to exercise the option (but in no event
      later than the Expiration Date).

      1.2   Termination for Cause. If Grantee's employment is terminated for
      cause, including (without limitation) fraud, theft, embezzlement committed
      against the Company or any of its affiliated companies or a customer of
      the Company, or for conflict of interest, unethical conduct, dishonesty
      affecting the assets, properties or business of the Company or any of its
      affiliated companies, willful misconduct, or continued material
      dereliction of duties, the option will wholly and completely terminate on
      the date of termination of employment if such termination occurs (i) prior
      to a Change of Control that occurs after the Date of Grant or (ii) after
      the second anniversary of a Change of Control that occurs after the Date
      of Grant. If Grantee's employment is terminated for Cause (as defined in
      the Plan), the option will wholly and completely terminate on the date
      thirty days following such termination (but not later than the Expiration
      Date) if such termination occurs within two years following a Change of
      Control that occurs after the Date of Grant.

      1.3   Termination without Cause or for Good Reason in Connection with a
      Change in Control. Notwithstanding any other provision of this Stock
      Option Agreement to the contrary, if a Change in Control of the Company
      occurs, the provisions of Article 14 of the Plan shall govern.

      1.4   Divestiture of Business Unit. If the Company divests its ownership
      in a business unit that employs the Grantee, then the option will be
      deemed to be fully vested on the effective date of the Divestiture of the
      business unit. The Grantee will have three years in which to exercise the
      option. A "Divestiture" includes the disposition of any business unit of
      the Company and its subsidiaries to an entity that the Company does not
      consolidate in its financial statements, whether the disposition is
      structured as a sale or transfer of stock, a merger, a consolidation or a
      sale or transfer of assets, or a combination thereof, provided that a
      "Divestiture" shall not include a disposition that constitutes a Change in
      Control.

      1.5   Retirement or Disability. In the event of the retirement (such that
      the Grantee's age plus years of service with the Company equals or exceeds
      65) or long-term disability of the Grantee, as long-term disability is
      determined in the discretion of the Committee (as defined in the Plan),
      all granted but unvested options shall immediately vest upon the Grantee's
      retirement or long-term disability. The Grantee shall have five years from
      the date of termination of employment due to retirement or long-term
      disability to exercise the option (but not later than the Expiration
      Date).

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      1.6   Death. Upon the death of the Grantee in active service, all granted
      but unvested options shall immediately vest upon the Grantee's death and
      otherwise shall be exercisable for a period of one year following
      Grantee's death (but in no event later than the Expiration Date).

2.    PROHIBITED ACTIVITY. Notwithstanding any other provision of this Stock
      Option Agreement, if Grantee engages in a "Prohibited Activity," as
      described below, while employed by the Company or any of its affiliates or
      within two years after Grantee's employment termination date, then
      Grantee's right to exercise any portion of the option, to the extent still
      outstanding at that time, shall immediately thereupon wholly and
      completely terminate. If an allegation of a Prohibited Activity by Grantee
      is made to the Committee, the Committee, in its discretion, may suspend
      the exercisability of the option for up to two months to permit the
      investigation of such allegation. If it is determined that no Prohibited
      Activity was engaged in by Grantee, the period of exercisability of the
      option will be increased by the amount of time of the suspension; however,
      in no event will the option be exercisable more than ten years from the
      date of grant. A "Prohibited Activity" shall be deemed to have occurred,
      as determined by the Committee in its sole and absolute discretion, if
      Grantee:

            (i)   divulges any non-public, confidential or proprietary
                  information of the Company or of its past, present or future
                  affiliates (collectively, the "Baker Hughes Group"), but
                  excluding information that (a) becomes generally available to
                  the public other than as a result of Grantee's public use,
                  disclosure, or fault, or (b) becomes available to Grantee on a
                  non-confidential basis after Grantee's employment termination
                  date from a source other than a member of the Baker Hughes
                  Group prior to the public use or disclosure by Grantee,
                  provided that such source is not bound by a confidentiality
                  agreement or otherwise prohibited from transmitting the
                  information by a contractual, legal or fiduciary obligation;
                  or

            (ii)  directly or indirectly, consults or becomes affiliated with,
                  conducts, participates or engages in, or becomes employed by,
                  any business that is competitive with the business of any
                  member of the Baker Hughes Group, wherever from time to time
                  conducted throughout the world, including situations where
                  Grantee solicits or participates in or assists in any way in
                  the solicitation or recruitment, directly or indirectly, of
                  any employees of any member of the Baker Hughes Group.

3.    CASHLESS EXERCISE. Cashless exercise, in accordance with the terms of the
      Plan, shall be available to Grantee for the shares subject to the option.

4.    TAX WITHHOLDING. To the extent the exercise of the option results in
      taxable income to Grantee, the Company is authorized to withhold from any
      remuneration payable to Grantee any tax required to be withheld by reason
      of such taxable income.

5.    NONTRANSFERABILITY. The option is not transferable by the Grantee
      otherwise than by will or by the laws of descent and distribution, and is
      exercisable during the Grantee's lifetime only by the Grantee.

6.    LIMIT OF LIABILITY. Under no circumstances will the Company be liable for
      any indirect, incidental, consequential or special damages (including lost
      profits) of any form incurred by any person, whether or not foreseeable
      and regardless of the form of the act in which such a claim may be
      brought, with respect to the Plan or the Company's role as Plan sponsor.

7.    MISCELLANEOUS. The option is granted under and is subject to all of the
      provisions of the Plan, including amendments to the Plan, if any. In the
      event of a conflict between these Terms and Conditions and the Plan
      provisions, the Plan provisions will control. Capitalized terms that are
      not defined herein shall have the meaning ascribed to such terms in the
      Plan.<PAGE>

                                                                   EXHIBIT 10.49

                            BAKER HUGHES INCORPORATED

                        RESTRICTED STOCK AWARD AGREEMENT

                                     AWARDEE

DATE OF AWARD:

NUMBER OF SHARES:
                            AWARD OF RESTRICTED STOCK

      The Compensation Committee (the "Committee") of the Board of Directors of
Baker Hughes Incorporated, a Delaware corporation (the "Company"), pursuant to
the Baker Hughes Incorporated 2002 Director & Officer Long-Term Incentive Plan
(the "Plan"), hereby awards to you, the above-named awardee, effective as of the
Date of Award set forth above (the "Date of Award"), that number of shares (the
"Shares") of the Company's Common Stock, $1.00 par value per share (the "Common
Stock"), set forth above as Restricted Stock on the following terms and
conditions:

      During the Restricted Period, the Shares of Restricted Stock will be
evidenced by entries in the stock register of the Company reflecting that such
Shares of Restricted Stock have been issued in your name. For purposes of this
Agreement, the term "Restricted Period" means the period designated by the
Committee during which the Shares may not be sold, assigned, transferred,
pledged, or otherwise encumbered.

      The Shares that are awarded hereby to you as Restricted Stock shall be
subject to the prohibitions and restrictions set forth herein with respect to
the sale or other disposition of such Shares and the obligation to forfeit and
surrender such Shares to the Company (the "Forfeiture Restrictions"). The
Forfeiture Restrictions shall lapse as to the Shares that are awarded hereby in
accordance with the following schedule provided that your employment with the
Company and its Affiliates has not terminated prior to the applicable lapse
date:

      (a)   on the first anniversary of the Date of Award, the Forfeiture
            Restrictions shall lapse as to one-third of the Shares subject to
            this Agreement; and

      (b)   on each succeeding anniversary of the Date of Award, the Forfeiture
            Restrictions shall lapse as to an additional one-third of the Shares
            subject to this Agreement, so that on the third anniversary of the
            Date of Award the Forfeiture Restrictions shall lapse as to all of
            the Shares subject to this Agreement.

If a Change in Control of the Company occurs or your employment with the Company
and all Affiliates terminates before the third anniversary of the Date of Award,
your rights to the Shares of Restricted Stock under this Agreement will be
determined as provided in the attached Terms and Conditions of Award Agreements
(dated ________________) (the "Terms and Conditions").

                                       1

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      The Shares of Restricted Stock awarded hereby may not be sold, assigned,
pledged, exchanged, hypothecated or otherwise transferred, encumbered or
disposed of (other than by will or the applicable laws of descent and
distribution) to the extent then subject to the Forfeiture Restrictions. Any
such attempted sale, assignment, pledge, exchange, hypothecation, transfer,
encumbrance or disposition in violation of this Agreement shall be void and the
Company shall not be bound thereby. Further, the Shares awarded hereby that are
no longer subject to Forfeiture Restrictions may not be sold or otherwise
disposed of in any manner that would constitute a violation of any applicable
federal or state securities laws. You also agree that (a) the Company may refuse
to cause the transfer of the Shares to be registered on the stock register of
the Company if such proposed transfer would in the opinion of counsel
satisfactory to the Company constitute a violation of any applicable securities
law and (b) the Company may give related instructions to the transfer agent, if
any, to stop registration of the transfer of the Shares.

      Upon the lapse of the Forfeiture Restrictions with respect to Shares
awarded hereby the Company shall cause to be delivered to you a stock
certificate representing such Shares, and such Shares shall be transferable by
you (except to the extent that any proposed transfer would, in the opinion of
counsel satisfactory to the Company, constitute a violation of applicable
securities law).

      The Shares that may be issued under the Plan are registered with the
Securities and Exchange Commission under a Registration Statement on Form S-8. A
Prospectus describing the Plan and the Shares can be found on the Baker Hughes
Interchange at http://interchange/legal/Benefit%20Plans/benefit.htm.

      Capitalized terms that are not defined herein shall have the meaning
ascribed to such terms in the Plan or the Terms and Conditions.

      In accepting the award of Shares of Restricted Stock set forth in this
Agreement you accept and agree to be bound by all the terms and conditions of
the Plan, this Agreement and the Terms and Conditions.

                                              BAKER HUGHES INCORPORATED

                                              /s/ Chad C. Deaton
                                              ---------------------------------
                                              Chad C. Deaton -- Chairman & CEO

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