Document:

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                                                                   Exhibit 10.25

                           CELLOMICS, INC. STOCK PLAN

SECTION 1.  PURPOSE.

         The purpose of the Cellomics, Inc. Stock Plan (the "Plan") is to secure
for Cellomics, Inc. (the "Company") the benefits arising from capital stock
ownership by those employees, directors, officers and consultants of the Company
who will be responsible for the Company's future growth and continued success.

         The Plan will provide a means whereby (a) employees of the Company may
purchase stock in the Company pursuant to options which qualify as "incentive
stock options" ("Incentive Stock Options") under Section 422 of the Internal
Revenue Code of 1986, as amended (the "Code"); (b) directors, employees and
consultants of the Company may purchase stock in the Company pursuant to options
granted hereunder which do not qualify as Incentive Stock Options
("Non-Qualified Options"); (c) directors, employees and consultants of the
Company may be awarded stock in the Company ("Awards"); (d) directors, employees
and consultants of the Company may receive stock appreciation rights ("SARs");
and (e) directors, employees and consultants of the Company may make direct
purchases of stock in the Company ("Purchases"). Both Incentive Stock Options
and Non-Qualified Options are sometimes referred to hereinafter individually as
an "Option" and collectively as "Options". As used herein the terms "parent" and
"subsidiary" mean "parent corporation" and "subsidiary corporation" as those
terms are defined in Section 424 of the Code and the term "Related Corporation"
shall mean any parent or subsidiary of the Company. Options, Awards, SARs and
Purchases are referred to hereafter individually as a "Plan Benefit" and
collectively as "Plan Benefits". Directors, employees and consultants of the
Company who are eligible to participate in this Plan are referred to herein as
"Participants".

SECTION 2.  ADMINISTRATION.

         2.1 Board of Directors and the Committee. The Plan will be administered
by the Board of Directors of the Company whose construction and interpretation
of the terms and provisions of the Plan shall be final and conclusive. Any
director to whom a Plan Benefit is awarded shall be ineligible to vote upon his
or her Plan Benefit, but Plan Benefits may be granted to any such director by a
vote of the remainder of the directors, except as limited below. The Board of
Directors may, in its sole discretion, authorize the grant of Options, authorize
the issuance of shares upon exercise of such Options, authorize the grant of
Awards, authorize the grant of SARs and approve Purchases, all as provided in
the Plan. The Board of Directors shall have authority, subject to the express
provisions of the Plan, to construe the Plan and its related agreements to
prescribe, amend and rescind rules and regulations relating to the Plan, to
determine the terms and provisions of the respective Option, Award, SAR and
Purchase agreements, which need not be identical, and to make all other
determinations in the judgment of the Board of Directors necessary or desirable
for the administration of the Plan. The Board of Directors may correct any
defect or supply any omission or reconcile any inconsistency in the Plan or in
any related agreement in the manner and to the extent it shall in its sole
discretion deem expedient to carry the Plan into effect. No director shall be
liable for any action or determination made in good faith. The Board of
Directors may delegate any or all of its powers under the Plan to a Compensation
Committee or other Committee (the "Committee") appointed by the Board of
Directors consisting of at least three (3) members of the Board of Directors. If
the Company has a class of stock registered pursuant to Section 12 of the
Securities Exchange Act of 1934, as amended (the "Exchange Act"), then members
of the Committee shall at all times be: (i) "outside directors" as such term is
defined in Treas. Reg. Section 1.162-27(e)(3) (or any successor regulation); and
(ii) "non-employee directors" within the meaning of Rule 16b-3 (or any successor
rule) under the Exchange Act, as such terms are interpreted from time to time.
If the Committee is so appointed, all references to the Board of Directors
herein shall mean and relate to such Committee, unless the context otherwise
requires.

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         2.2 Compliance with Section 162(m) of the Code. Section 162(m) of the
Code, added by the Omnibus Budget Reconciliation Act of 1993, generally limits
the tax deductibility to publicly held companies of compensation in excess of
$1,000,000 paid to certain "covered employees" ("Covered Employees"). If the
Company is subject to Section 162(m) of the Code, it is the Company's intention
to preserve the deductibility of such compensation to the extent it is
reasonably practicable and to the extent it is consistent with the Company's
compensation objectives. For purposes of this Plan, Covered Employees of the
Company shall be those employees of the Company described in Section 162(m)(3)
of the Code, as amended from time to time (or any successor provision).

SECTION 3.  ELIGIBILITY.

         3.1 Incentive Stock Options. Participants who are employees shall be
eligible to receive Incentive Stock Options pursuant to the Plan; provided that
no person shall be granted any Incentive Stock Option under the Plan who, at the
time such Option is granted, owns, directly or indirectly, Voting Common Stock
of the Company possessing more than ten percent (10%) of the total combined
voting power of all classes of stock of the Company or of its Related
Corporations, unless the requirements of Section 6.6(b) hereof are satisfied. In
determining whether this ten percent (10%) threshold has been reached, the stock
attribution rules of Section 424(d) of the Code shall apply. Directors who are
not regular employees are not eligible to receive Incentive Stock Options.

         3.2 Non-Qualified Options, Awards, SARs and Purchases. Non-Qualified
Options, Awards, SARs and authorizations to make Purchases may be granted to any
Participant.

         3.3 Generally. The Board of Directors may take into consideration a
Participant's individual circumstances in determining whether to grant an
Incentive Stock Option, a Non-Qualified Option, an Award or an SAR or to approve
a Purchase. Granting of any Option, Award or SAR or approval of any Purchase for
any individual shall neither entitle that individual to, nor disqualify that
individual from, participation in any other grant of Plan Benefits, except as
otherwise contemplated by this Plan or the Code.

SECTION 4.  STOCK SUBJECT TO PLAN.

         Subject to adjustment as provided in Sections 10 and 11 hereof, the
stock to be offered under the Plan shall consist of shares of the Company's
Voting Common Stock, $.01 par value, and the maximum number of shares of stock
which will be reserved for issuance, and in respect of which Plan Benefits may
be granted pursuant to the provisions of the Plan, shall not exceed in the
aggregate Three Hundred Thousand (300,000) shares of Voting Common Stock. Such
shares may be authorized and unissued shares or may be treasury shares. If an
Option or SAR granted hereunder shall expire or terminate for any reason without
having been exercised in full, or if the Company shall reacquire any unvested
shares issued pursuant to Awards or Purchases, the unpurchased shares subject
thereto and any unvested shares so reacquired shall again be available for
subsequent grants of Plan Benefits under the Plan. Stock issued pursuant to the
Plan may be subject to such restrictions on transfer, repurchase rights or other
restrictions as shall be determined by the Board of Directors.

SECTION 5. GRANTING OF OPTIONS, AWARDS AND SARS AND APPROVALS OF PURCHASES.

         Options, Awards, and SARs may be granted and Purchases may be approved
under the Plan at any time after April 1, 1998 and prior to March 30, 2003. The
date of grant of an Option, Award or SAR or approval of a Purchase under the
Plan will be the date specified by the Board of Directors at the time of the
Option, Award or SAR or approval of such Purchase; provided, however, that such
date shall not be prior to the

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date on which the Board of Directors takes such action. The Board of Directors
shall have the right, with the consent of a Participant, to convert an Incentive
Stock Option granted under the Plan to a Non-Qualified Option pursuant to
Section 6.7. Specific Plan Benefits may be granted alone or in addition to other
grants under the Plan.

SECTION 6.  SPECIAL PROVISIONS APPLICABLE TO OPTIONS AND SARS.

         6.1 Purchase Price and Shares Subject to Options and SARs.

                  (a) The purchase price for each share deliverable upon the
         exercise of an Incentive Stock Option shall be determined by the Board
         of Directors, provided, however, that the exercise price with respect
         to an Incentive Stock Option shall not be less than one hundred percent
         (100%) of the fair market value of the shares subject to the Incentive
         Stock Option on the date such Option is granted (except as modified in
         Section 6.6(b) hereof). In the case of Non-Qualified Options, the
         exercise price shall be determined by the Board of Directors in its
         discretion.

                  (b) Options granted under the Plan may provide for the payment
         of the exercise price by delivery of (i) cash or a check payable to the
         order of the Company in an amount equal to the exercise price of such
         Options, (ii) shares of Voting Common Stock of the Company owned by the
         Participant having a fair market value equal in amount to the exercise
         price of the Options being exercised, or (iii) any combination of the
         foregoing subsections (i) and (ii). The fair market value of any shares
         of the Company's Voting Common Stock which may be delivered upon
         exercise of an Option shall be determined pursuant to Section 6.1(c)
         below. The purchase price shall be paid on the date the Option is
         exercised.

                  (c) If, at the time an Option is granted under the Plan, the
         Company's Voting Common Stock is publicly traded, "fair market value",
         as such phrase is used in this Plan, shall be determined as of the last
         business day for which the prices or quotes discussed in this sentence
         are available prior to the date such Option is granted (the
         "Determination Date") and shall mean (i) the average (on the
         Determination Date) of the high and low prices of the Voting Common
         Stock on the principal National securities exchange on which the Voting
         Common Stock is traded, if such Voting Common Stock is then traded on a
         national securities exchange; (ii) the last reported sale price (on the
         Determination Date) of the Voting Common Stock on the Nasdaq Stock
         Market if the Voting Common Stock is not then traded on a national
         securities exchange; or (iii) the closing bid price (or average of bid
         prices) last quoted (on the Determination Date) by an established
         quotation service for over-the-counter securities, if the Voting Common
         Stock is not reported on the Nasdaq Stock Market. However, if the
         Voting Common Stock is not publicly traded at the time an Option is
         granted under the Plan, "fair market value" shall be deemed to be the
         fair market value of the Voting Common Stock as determined by the Board
         of Directors after taking into consideration all factors which it deems
         appropriate, including, without limitation, recent sale and offer
         prices of the Voting Common Stock in private transactions negotiated at
         arm's length.

                  (d) If the Company is subject to Section 162(m) of the Code,
         the maximum number of shares with respect to which Options or SARs may
         be granted to any Covered Employee, including any cancellations or
         repricings which may occur, shall be limited to 25,000 shares in any
         calendar year.

         6.2 Duration of Options and SARs. Subject to Section 6.6(b) hereof,
each Option and SAR and all rights thereunder shall expire on such date as the
Board of Directors may determine, but in no event later than ten (10) years from
the day on which the Option or SAR is granted and shall be subject to earlier
termination as provided herein.

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         6.3 Exercise of Options and SARs

                  (a) Subject to Section 6.6(b) hereof, each Option and SAR
         granted under the Plan shall be exercisable at such time or times and
         during such period as shall be set forth in the instrument evidencing
         such Option or SAR. To the extent that an Option or SAR is not
         exercised by a Participant when it becomes initially exercisable, it
         shall not expire but shall be carried forward and shall be exercisable,
         on a cumulative basis until the expiration of the exercise period. No
         partial exercise may be for less than ten (10) full shares of Voting
         Common Stock (or its equivalent).

                  (b) The Board of Directors shall have the right to accelerate
         the date of exercise of any installments of any Option or SAR; provided
         that the Board of Directors shall not accelerate the exercise date of
         any installment of any Option granted to a Participant as an Incentive
         Stock Option (and not previously converted into a Non-Qualified Option
         pursuant to Section 6.7) if such acceleration would violate the annual
         vesting limitation contained in Section 422(d)(1) of the Code, as
         amended, which, on the date of this Plan, provides generally the
         aggregate fair market value (determined at the time the Option is
         granted) of the stock with respect to which Incentive Stock Options
         granted to any Participant are exercisable for the first time by such
         Participant during any calendar year (under all plans of the Company
         and any Related Corporations) shall not exceed $100,000.

         6.4 Nontransferability of Options and SARs. No Option or SAR granted
under the Plan shall be assignable or transferable by the Participant, either
voluntarily or by operation of law, except by will or the laws of descent and
distribution or, with respect to Non-Qualified Options and SARs, pursuant to a
qualified domestic relations order as defined by the Code or Title I of the
Employee Retirement Income Security Act ("ERISA") or the rules promulgated
thereunder or unless the Participant's non-qualified stock option agreement
granting such options (the "Non-Qualified Stock Option Agreement") or the
Participant's SAR agreement granting such SARs (the "SAR Agreement") provides
otherwise. Unless otherwise provided by the Non-Qualified Stock Option Agreement
or the SAR Agreement, during the life of the Participant, the Option or SAR
shall be exercisable only by him or her. If any Participant should attempt to
dispose of or encumber his or her Options or SARs, other than in accordance with
the applicable terms of a Non-Qualified Stock Option Agreement or SAR Agreement,
his or her interest in such Options or SARs shall terminate.

         6.5      Effect of Termination of Employment or Death.

                  (a) If a Participant ceases to be employed by the Company for
         any reason, including retirement but other than death, any Option or
         SAR granted to such Participant under the Plan shall immediately
         terminate; provided, however, that any portion of such Option or SAR
         which was otherwise exercisable on the date of termination of the
         Participant's employment may, subject to the terms of the applicable
         Option Agreement or SAR Agreement, be exercised within the three-month
         period following the date on which the Participant ceased to be so
         employed, but in no event after the expiration of the exercise period.
         Any such exercise may be made only to the extent of the number of
         shares subject to the Option or SAR which were purchasable on the date
         of such termination of employment. If the Participant dies during such
         three-month period, the Option or SAR shall be exercisable by the
         Participant's personal representatives, heirs or legatees to the same
         extent and during the same period that the Participant could have
         exercised the Option or SAR on the date of his or her death.

                  (b) If the Participant dies while an employee of the Company
         or any Related Corporation, any Option or SAR granted to such
         Participant under the Plan shall be exercisable by the Participant's
         personal representatives, heirs or

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         legatees, for the purchase of the number of shares and to the same
         extent that the Participant could have exercised the Option or SAR on
         the date of his or her death. The Option or SAR or any unexercised
         portion thereof shall terminate unless so exercised prior to the
         earlier of the expiration of six months from the date of such death or
         the expiration of the exercise period.

         6.6 Designation of Incentive Stock Options; Limitations. Options
granted under the Plan which are intended to be Incentive Stock Options
qualifying under Section 422 of the Code shall be designated as Incentive Stock
Options and shall be subject to the following additional terms and conditions:

                  (a) Dollar Limitation. The aggregate fair market value
         (determined at the time the option is granted) of the Voting Common
         Stock for which Incentive Stock Options are exercisable for the first
         time during any calendar year by any person under the Plan (and all
         other incentive stock option plans of the Company and any Related
         Corporations) shall not exceed $100,000. In the event that Section
         422(d)(1) of the Code is amended to alter the limitation set forth
         therein so that following such amendment such limitation shall differ
         from the limitation set forth in this Section 6.6(a), the limitation of
         this Section 6.6(a) shall be automatically adjusted accordingly.

                  (b) 10% Stockholder. If any employee to whom an Incentive
         Stock Option is granted pursuant to the provisions of the Plan is on
         the date of grant the owner of stock possessing more than ten percent
         (10%) of the total combined voting power of all classes of stock of the
         Company or any Related Corporations, then the following special
         provisions shall be applicable to the Incentive Stock Option granted to
         such individual:

                           (i) The purchase price per share of the Voting Common
                  Stock subject to such Incentive Stock Option shall not be less
                  than one hundred ten percent (110%) of the fair market value
                  of one share of Voting Common Stock on the date of grant; and

                           (ii) The option exercise period shall not exceed five
                   years from the date of grant.

         In determining whether the ten percent (10%) threshold has been
         reached, the stock attribution rules of Section 424(d) of the Code, as
         amended from time to time, shall apply.

                  (c) Except as modified by the preceding provisions of this
         Section 6.6 or as otherwise required by applicable law, all of the
         provisions of the Plan shall be applicable to Incentive Stock Options
         granted hereunder.

         6.7 Conversion of Incentive Stock Options into Non-Qualified Options;
Termination of Incentive Stock Options. The Board of Directors, at the written
request of any Participant, may in its discretion take such actions as may be
necessary to convert such Participant's Incentive Stock Options (or any
installments or portions of installments thereof) that have not been exercised
on the date of conversion into Non-Qualified Options at any time prior to the
expiration of such Incentive Stock Options, regardless of whether the
Participant is an employee of the Company at the time of such conversion. Such
actions may include, but not be limited to, extending the exercise period or
reducing the exercise price of the appropriate installments of such Options. At
the time of such conversion, the Board of Directors (with the consent of the
Participant) may impose such conditions on the exercise of the resulting
Non-Qualified Options as the Board of Directors in its discretion may determine,
provided that such conditions shall not be inconsistent with the Plan. Nothing
in the Plan shall be deemed to give any Participant the right to have such
Participant's Incentive Stock Options converted into Non-Qualified Options, and
no such conversion shall occur until and unless the Board of Directors takes
appropriate action. The Board of Directors, with the

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consent of the Participant, may also terminate any portion of any Incentive
Stock Option that has not been exercised at the time of such termination.

         6.8 Stock Appreciation Rights. An SAR is the right to receive, without
payment, an amount equal to the excess, if any, of the fair market value of a
share of Voting Common Stock on the date of exercise over the grant price, which
amount will be multiplied by the number of shares with respect to which the SARs
shall have been exercised. The grant of SARs under the Plan shall be subject to
the following terms and conditions and shall contain such additional terms and
conditions, not inconsistent with the express terms of the Plan, as the Board of
Directors shall deem desirable:

                  (a) Grant. SARs may be granted in tandem with, in addition to
         or completely independent of any other Plan Benefit.

                  (b) Grant Price. The grant price of an SAR may be the fair
         market value of a share of Voting Common Stock on the date of grant or
         such other price as the Board of Directors may determine.

                  (c) Exercise. An SAR may be exercised by a Participant in
         accordance with procedures established by the Board of Directors or as
         otherwise provided in any agreement evidencing any SARs. The Board of
         Directors may provide that an SAR shall be automatically exercised on
         one or more specified dates.

                  (d) Form of Payment. Payment upon exercise of an SAR may be
         made in cash, in shares of Voting Common Stock or any combination
         thereof, as the Board of Directors shall determine.

                  (e) Fair Market Value. For purposes of SARs, fair market value
         shall be determined in accordance with Section 6.1(c) with the
         "Determination Date" being determined by reference to the date of grant
         or the date of exercise of an SAR, as applicable.

         6.9 Rights as a Stockholder. The holder of an Option or SAR shall have
no rights as a stockholder or SAR holder with respect to any shares covered by
the Option or SAR until the date of issue of a stock certificate to him or her
for such shares or a certificate evidencing SARs. Except as otherwise expressly
provided in the Plan, no adjustment shall be made for dividends or other rights
for which the record date is prior to the date such stock certificate or SAR
certificate is issued.

         6.10 Special Provisions Applicable to Non-Qualified Options and SARs
Granted to Covered Employees. If the Company is subject to Section 162(m) of the
Code, in order for the full value of Non-Qualified Options or SARs granted to
Covered Employees to be deductible by the Company for federal income tax
purposes, the Company may intend for such Non-Qualified Options or SARs to be
treated as "qualified performance-based compensation" as described in Treas.
Reg. Section 1.162-27(e) (or any successor regulation). In such case,
Non-Qualified Options or SARs granted to Covered Employees shall be subject to
the following additional requirements:

                  (a) such Options and SARs shall be granted only by the
         Committee; and

                  (b) the exercise price of such Options and the grant price of
         such SARs granted shall in no event be less than the fair market value
         of the Voting Common Stock as of the date of grant of such Options or
         SARs.

SECTION 7.  SPECIAL PROVISIONS APPLICABLE TO AWARDS.

         7.1 Grant of Awards. The Board of Directors may grant a Participant an
Award subject to such terms and conditions as the Board of Directors deems

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appropriate, including, without limitation, restrictions on the pledging, sale,
assignment, transfer or other disposition of such shares and the requirement
that the Participant forfeit all or a portion of such shares back to the Company
upon termination of employment.

         7.2 Conditions. Approvals of Awards may be subject to the following
conditions, among others:

                  (a) Each Participant receiving an Award shall enter into an
         agreement (a "Stock Restriction Agreement") with the Company, if
         required by the Board of Directors, in a form specified by the Board of
         Directors agreeing to such terms and conditions of the Award as the
         Board of Directors deems appropriate.

                  (b) Shares issued and transferred to a Participant pursuant to
         an Award may, if required by the Board of Directors, be deposited with
         the Treasurer or other officer of the Company designated by the Board
         of Directors to be held until the lapse of the restrictions upon such
         shares, and each Participant shall execute and deliver to the Company
         stock powers enabling the Company to exercise its rights hereunder and
         under the Stock Restriction Agreement.

                  (c) Certificates for shares issued pursuant to an Award shall,
         if the Company shall deem it advisable, bear a legend to the effect
         that they are issued subject to specified restrictions.

                  (d) Certificates representing the shares issued pursuant to an
         Award shall be registered in the name of the Participant and shall be
         owned by such Participant. Such Participant shall be the holder of
         record of such shares for all purposes, including voting and receipt of
         dividends paid with respect to such shares.

         7.3 Nontransferability. Shares issued pursuant to an Award may not be
sold, assigned, transferred, alienated, commuted, anticipated, or otherwise
disposed of (except, subject to the provisions of such Participant's Stock
Restriction Agreement, by will or the laws of descent and distribution or
pursuant to a qualified domestic relations order as defined by the Code or Title
I of ERISA or the rules promulgated thereunder), or pledged or hypothecated as
collateral for a loan or as security for the performance of any obligation, or
be otherwise encumbered, and shall not be subject to attachment, garnishment,
execution or other legal or equitable process, prior to the lapse of
restrictions on such shares, and any attempt at action in contravention of this
Section shall be null and void. If any Participant should attempt to dispose of
or encumber his or her shares issued pursuant to an Award prior to the lapse of
the restrictions imposed on such shares, his or her interest in such shares
shall terminate.

         7.4 Effect of Termination of Employment or Death on Awards. If, prior
to the lapse of restrictions applicable to Awards, the Participant ceases to be
an employee of the Company for any reason (including, without limitation, the
death of the Participant), Awards to such Participant, as to which restrictions
have not lapsed, shall be forfeited to the Company, effective on the date of the
Participant's termination of employment. The Board of Directors shall have the
sole power to decide in each case to what extent leaves of absence shall be
deemed a termination of employment.

SECTION 8.  SPECIAL PROVISIONS APPLICABLE TO PURCHASES.

         All approvals of Purchases which provide that the Company has a right
to repurchase the shares subject to such Purchase (the "Restricted Shares")
shall be subject to the terms and conditions set forth in the related agreement
(the "Stock Purchase Restriction Agreement") approved by the Board of Directors,
and shall be subject to the other terms and conditions of this Section 8.

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         8.1 Conditions. All approvals of Purchases shall be subject to the
following conditions, among others:

                  (a) Prior to the issuance of Restricted Shares, the
         Participant shall pay to the Company the purchase price (the "Purchase
         Price") of the Restricted Shares in cash or in such other manner as
         shall be approved by the Board of Directors.

                  (b) Restricted Shares issued to a Participant may, if required
         by the Board of Directors, be deposited with the Treasurer or other
         officer of the Company designated by the Board of Directors to be held
         until the lapse of the restrictions upon such Restricted Shares, and
         each Participant shall execute and deliver to the Company stock powers
         enabling the Company to exercise its rights hereunder and under the
         Stock Purchase Restriction Agreement.

                  (c) Certificates for Restricted Shares shall, if the Company
         shall deem it advisable, bear a legend to the effect that they are
         issued subject to specified restrictions.

                  (d) Certificates representing the Restricted Shares shall be
         registered in the name of the Participant and shall be owned by such
         Participant. Such Participant shall be the holder of record of such
         Restricted Shares for all purposes, including voting and receipt of
         dividends paid with respect to such Restricted Shares.

         8.2 Nontransferability. A Participant's Restricted Shares may not be
sold, assigned, transferred, alienated, commuted, anticipated, or otherwise
disposed of (except, subject to the provisions of such Participant's Stock
Purchase Restriction Agreement, by will or the laws of descent and distribution
or pursuant to a qualified domestic relations order as defined by the Code of
Title I of ERISA or the rules promulgated thereunder), or pledged or
hypothecated as collateral for a loan or as security for the performance of any
obligation, or be otherwise encumbered, and shall not be subject to attachment,
garnishment, execution or other legal or equitable process, prior to the lapse
of restrictions on such Restricted Shares, and any attempt at action in
contravention of this Section shall be null and void. If any Participant should
attempt to dispose of or encumber his or her Restricted Shares prior to the
lapse of the restrictions imposed on such Restricted Shares, his or her interest
in the Restricted Shares awarded to him or her shall terminate.

SECTION 9.  REQUIREMENTS OF LAW.

         9.1 Violations of Law. No shares or SARs shall be issued and delivered
upon exercise of any Option or the making of any Award or Purchase or the
payment of any SAR, respectively, unless and until, in the opinion of counsel
for the Company, any applicable registration requirements of the Securities Act
of 1933, as amended, any applicable listing requirements of any national
securities exchange on which stock of the same class is then listed, and any
other requirements of law or of any regulatory bodies having jurisdiction over
such issuance and delivery, shall have been fully complied with. Each
Participant may, by accepting Plan Benefits, be required to represent and agree
in writing, for himself or herself and for his or her transferees by will or the
laws of descent and distribution, that the securities acquired by him, her or
them is being acquired for investment. The requirement for any such
representation may be waived at any time by the Board of Directors.

         9.2 Compliance with Rule 16b-3. If the Company has a class of stock
registered pursuant to Section 12 of the Exchange Act, the intent of this Plan
is to qualify for the exemption provided by Rule 16b-3 under the Exchange Act.
To the extent any provision of the Plan does not comply with the requirements of
Rule 16b-3, it shall be deemed inoperative to the extent permitted by law and
deemed advisable by the Board of Directors and shall not affect the validity of
the Plan. In the event Rule

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16b-3 is revised or replaced, the Board of Directors may exercise discretion to
modify this Plan in any respect necessary to satisfy the requirements of the
revised exemption or its replacement.

SECTION 10.  RECAPITALIZATION

         In the event that dividends are payable in Voting Common Stock of the
Company or in the event there are splits, reverse splits, sub-divisions or
combinations of shares of Voting Common Stock of the Company, the number of
shares available under the Plan shall be increased or decreased proportionately,
as the case may be, and the number of shares deliverable upon the exercise
thereafter of any Option previously granted shall be increased or decreased
proportionately, as the case may be, without change in the aggregate purchase
price, and the number of shares to which granted SARs relate shall be increased
or decreased proportionately, as the case may be, and the grant price of such
SARs shall be decreased or increased proportionately, as the case may be,
without change in the aggregate purchase price.

SECTION 11.  REORGANIZATION.

         In case the Company is merged or consolidated with another corporation
and the Company is not the surviving corporation, or, in the case of a
reorganization, dissolution, liquidation or sale of substantivally all of the
assets of the Company (each a "Transaction"), the Board of Directors of the
Company, or the board of directors of any corporation assuming the obligations
of the Company hereunder, shall, as to outstanding Plan Benefits, either (i)
make appropriate provision for the protection of any such outstanding Plan
Benefits by the substitution on an equitable basis of appropriate securities of
the Company or of the merged, consolidated, reorganized or other successor
corporation which will be issuable in respect of the shares of Voting Common
Stock of the Company, provided only that the excess of the aggregate fair market
value of the securities subject to the Plan Benefits immediately after such
substitution over the purchase price thereof is not more than the excess of the
aggregate fair market value of the securities subject to such Plan Benefits
immediately before such substitution over the purchase price thereof, (ii) upon
written notice to the Participants, provide that all unexercised Plan Benefits
must be exercised within a specified number of days of the date of such notice
or such Plan Benefits will be terminated, or (iii) upon written notice to the
Participants, provide that the Company or the merged, consolidated, reorganized
or other successor corporation shall have the right, upon the effective date of
any such Transaction, to purchase all Plan Benefits held by each Participant and
unexercised as of that date at an amount equal to the aggregate fair market
value on such date of the shares subject to the Plan Benefits held by such
Participant over the aggregate purchase price therefor, such amount to be paid
in cash or, if securities of the merged, consolidated, reorganized or other
successor corporation are issuable in respect of the shares of the Voting Common
Stock of the Company, then, in the discretion of the Board of Directors, in
stock of such merged, consolidated, reorganized or other successor corporation
equal in fair market value to the aforesaid amount. In any such case the Board
of Directors shall, in good faith, determine fair market value and may, in its
discretion, advance the lapse of any waiting or installment periods and exercise
dates. As used in this Section 11, the term "stock" shall include securities of
any entity which is not a corporation.

SECTION 12.  NO SPECIAL EMPLOYMENT RIGHTS.

         Nothing contained in the Plan or in any Plan Benefit documentation
shall confer upon any Participant receiving, or eligible to receive, a grant of
any Plan Benefit any right with respect to the continuation of his or her
employment by the Company (or any Related Corporation) or interfere in any way
with the right of the Company (or any Related Corporation), subject to the terms
of any separate employment agreement to the contrary, at any time to terminate
such employment or to, from time to time, increase or decrease the compensation
of the Participant from the rate in existence at the time of the grant of any
Plan Benefit. Whether an authorized leave of absence, or

                                       9
<PAGE>   10

absence in military or government service, shall constitute termination of
employment for purposes of this Plan shall be determined by the Board of
Directors.

SECTION 13.  AMENDMENT OF THE PLAN.

         The Board of Directors may at any time and from time to time modify or
amend the Plan in any respect. The termination or any modification or amendment
of the Plan shall not, without the consent of a recipient of any Plan Benefit,
affect his or her rights under any Plan Benefit previously granted. With the
consent of the affected Participant, the Board of Directors may amend
outstanding agreements relating to any Plan Benefit, in a manner not
inconsistent with the Plan. The Board of Directors hereby reserves the right to
amend or modify the terms and provisions of the Plan and of any outstanding
Options to the extent necessary to qualify any or all Options under the Plan for
such favorable federal income tax treatment (including deferral of taxation upon
exercise) as may be afforded incentive stock options under Section 422 of the
Code, provided, however, that the consent of a Participant is required if such
amendment or modification would cause unfavorable income tax treatment for such
Participant.

SECTION 14.  WITHHOLDING

         The Company's obligation to deliver shares of stock upon the exercise
of any Option or the granting of an Award or to make payment upon any exercise
of any SAR or making of a Purchase shall be subject to the satisfaction by the
Participant of all applicable federal, state and local income and employment tax
withholding requirements. The Company may, in its discretion, withhold a portion
of the shares to which a Participant is entitled in connection with the
Participant's Plan Benefits to satisfy the Participant's withholding obligation.

SECTION 15.  EFFECTIVE DATE AND DURATION OF THE PLAN.

         15.1 Effective Date. The Plan shall become effective when adopted by
the Board of Directors, but no Incentive Stock Option granted under the Plan
shall become exercisable unless and until the Plan shall have been approved by
the Company's stockholders. If such stockholder approval is not obtained within
twelve (12) months after the date of the Board's adoption of the Plan, then any
Incentive Stock Options previously granted under the Plan shall terminate and no
further Incentive Stock Options shall be granted. Subject to such limitation,
Options may be granted under the Plan at any time after the effective date and
before the date fixed herein for termination of the Plan.

         15.2 Duration. Unless sooner terminated in accordance with Section 11
hereof, the Plan shall terminate upon the earlier of (i) the tenth (10th)
anniversary of the date of its adoption by the Board of Directors or (ii) the
date on which all shares available for issuance under the Plan shall have been
issued pursuant to any Awards or Purchases or the exercise or cancellation of
Options and SARs granted hereunder. If the date of termination is determined
under subsection (i) above, then Plan Benefits outstanding on such date shall
continue to have force and effect in accordance with the provisions of the
instruments evidencing such Plan Benefits.

SECTION 16.  GOVERNING LAW

         The Plan and all actions taken thereunder shall be governed by the laws
of the Commonwealth of Pennsylvania.

                                       10<PAGE>   1
                                                                    EXHIBIT 10.1

                             SHAREHOLDERS' AGREEMENT

                                  by and among

                              SCHLUMBERGER LIMITED,

                            BAKER HUGHES INCORPORATED

                                       and

                            THE OTHER PARTIES LISTED

                                     ON THE

                             SIGNATURE PAGES HERETO

                        Effective as of November 30, 2000

<PAGE>   2

                                TABLE OF CONTENTS

<TABLE>
<CAPTION>
                                                                           Page

<S>                                                                        <C>
ARTICLE I SHAREHOLDERS REPRESENTATIVES COMMITTEE..............................2
     SECTION 1.1.  Shareholders Representatives...............................2
     SECTION 1.2.  Actions Requiring Presentation to the Shareholders
                   Representatives Committee..................................3
     SECTION 1.3.  Actions Requiring a Special Vote of the Representatives....3
     SECTION 1.4.  Appointments to Governing Bodies...........................7
     SECTION 1.5.  Indemnification............................................7
     SECTION 1.6.  US EmployCo................................................8

ARTICLE II GENERAL PROVISIONS.................................................8
     SECTION 2.1.  Amendment..................................................8
     SECTION 2.2.  Notices....................................................8
     SECTION 2.3.  Validity..................................................11
     SECTION 2.4.  Survival of Rights........................................11
     SECTION 2.5.  Governing Law.............................................11
     SECTION 2.6.  Waiver....................................................11
     SECTION 2.7.  Remedies in Equity........................................12
     SECTION 2.8.  Terminology...............................................12
     SECTION 2.9.  Counterparts..............................................12
     SECTION 2.10. Further Assurances........................................12
</TABLE>

                                     - i -
<PAGE>   3

                             SHAREHOLDERS' AGREEMENT

         This SHAREHOLDERS' AGREEMENT (this "AGREEMENT") dated as of November
30, 2000, is entered into by and between Schlumberger Limited, a Netherlands
company ("SLB"), Schlumberger Technology Corporation, a Texas corporation
("STC"), Schlumberger Plc, a United Kingdom limited liability company ("SPLC"),
Schlumberger B.V., a Netherlands limited liability company ("SLBV"),
Schlumberger Oilfield Holdings Limited, an International Business Company of the
British Virgin Islands ("SOHL"), Baker Hughes Incorporated, a Delaware
corporation ("BHI"), Western Atlas International, Inc., a Delaware corporation
("WAII"), Baker Hughes (UK) Limited, an English company ("BHL"), Baker Hughes
International Branches Incorporated, a Delaware corporation ("BHIB"), and
Western Sea Holdings Limited, a Cayman Islands company ("WSHL" and, together
with STC, SPLC, SLBV, SOHL, WAII, BHL and BHIB, the "SHAREHOLDERS").

                                    RECITALS

         WHEREAS, SLB and BHI own, directly or through various subsidiaries, the
Shareholders; and

         WHEREAS, STC and WAII own 70% and 30% ownership interests,
respectively, in GECO Holdings L.L.C., a Delaware limited liability company ("US
VENTURE ENTITY"); and

         WHEREAS, SPLC and BHL own 70% and 30% ownership interests,
respectively, in GECO-PRAKLA (UK) Limited, a United Kingdom company ("UK VENTURE
ENTITY"); and

         WHEREAS, SLBV and BHIB own 70% and 30% ownership interests,
respectively, in Delft Geophysical B.V., a Netherlands company ("DUTCH VENTURE
ENTITY"); and

         WHEREAS, SOHL and WSHL own 70% and 30% ownership interests,
respectively, in Schlumberger Seismic Holdings Limited, an International
Business Company of the British Virgin Islands ("BVI VENTURE ENTITY" and,
together with US Venture Entity, UK Venture Entity and Dutch Venture Entity, the
"VENTURE ENTITIES"); and

         WHEREAS, STC and WAII own 70% and 30% ownership interests,
respectively, in GECO Resources, Inc., a Delaware corporation ("US EMPLOYCO");
and

         WHEREAS, the parties believe that it is in their best interests to
provide for, among other things, a Shareholders Representatives Committee with
respect to the Venture Entities and US EmployCo;

         NOW, THEREFORE, in consideration of the foregoing, the mutual covenants
and agreements contained herein and for other good and valuable consideration,
the receipt and sufficiency of which are hereby acknowledged, the parties hereby
agree as follows:
<PAGE>   4

                                   ARTICLE I
                     SHAREHOLDERS REPRESENTATIVES COMMITTEE

SECTION 1.1. Shareholders Representatives.

         (a) Each of SLB and BHI shall appoint two senior representatives (the
"REPRESENTATIVES") to serve on a Shareholders Representatives Committee (the
"COMMITTEE"), to discuss the overall policies, procedures and directions of the
Venture Entities and US EmployCo in accordance with the provisions of this
Agreement. In connection therewith, the parties agree to cause the Venture
Entities and US EmployCo to effect the decisions made by the Committee.

         (b) One of the Representatives appointed by SLB shall be designated by
SLB to serve as the Chairman of the Committee (the "CHAIRMAN"). The Chairman
shall preside at all meetings of the Committee and shall do and perform such
other duties as from time to time may be assigned to him by the Committee. The
Chairman may not be removed as Chairman except by the request of SLB, which may
appoint a successor Chairman. To facilitate the orderly conduct of meetings of
the Committee, the Chairman shall preside at such meetings, and in his absence
the other Representative appointed by SLB shall preside.

         (c) Except as otherwise provided, the Committee shall act at meetings
thereof duly convened and held as provided in this Agreement. Except as
otherwise provided in Section 1.1(h), a quorum shall exist for the transaction
of business by the Committee if at least one Representative of each of SLB and
BHI is present. The Representatives shall vote according to the ownership
percentages of their respective appointees, such that the Representatives
appointed by SLB, individually and collectively, shall have a 70% vote and the
Representatives appointed by BHI, individually and collectively, shall have a
30% vote. Except as otherwise provided in Section 1.3, the vote of a majority of
the ownership percentages of SLB and BHI shall constitute the act of the
Committee.

         (d) The Representatives may participate in a meeting thereof by means
of conference telephone or similar communications equipment allowing all
participants to hear each other at the same time. Participation by such means
shall constitute presence in person at a meeting.

         (e) Any action required or permitted by this Agreement to be taken at a
meeting of the Committee may be taken if the requisite number of Representatives
consent in writing to the taking of such action.

         (f) The Committee may hold meetings, both regular and special, in any
agreed upon location.

         (g) Regular meetings of the Committee may be held without notice at
such time and at such place as shall from time to time be determined by
unanimous consent of the Representatives, but no less frequently than twice each
calendar year.

         (h) Special meetings of the Committee may be called by any
Representative on seven days' notice to the other Representatives in accordance
with Section 2.2. A Representative may waive notice of a meeting either before
or after a meeting. Any Representative attending a

                                      -2-
<PAGE>   5

meeting, unless he attends for the specific purpose of objecting to the
transaction of any business at the meeting because he in good faith believes
that the meeting has not been properly called or convened, shall be deemed to
have received proper notice. Notwithstanding anything to the contrary contained
in this Agreement, if (i) (A) an SLB-appointed Representative provides at least
30 days' notice to the BHI-appointed Representatives with respect to the calling
of a special meeting or (B) a regular meeting is convened at its usually
scheduled date, time and place and (ii) at least one SLB-appointed
Representative is present at such meeting, a quorum shall be deemed to exist
regardless of whether one or both of the BHI-appointed Representatives are
absent from such meeting.

         (i) A Representative may only be removed or replaced by the party that
appointed him.

         (j) Any Representative may (i) designate an alternate person to
represent him as a Representative at a meeting of the Committee and for all
purposes incidental thereto or (ii) give the other Representative appointed by
the same party (or an alternate designated by either such Representative) his or
her written proxy to vote at any meeting. Any Representative represented by
proxy at a meeting shall be deemed to be in attendance for quorum purposes.

SECTION 1.2. Actions Requiring Presentation to the Shareholders Representatives
Committee.

         The following matters shall be presented to the Committee for its
approval:

         (a) Any matter that would require the special vote required under
Section 1.3;

         (b) The rolling three-year annual Venture (as defined below) business
plan and forecasts and any quarterly updates of the same;

         (c) The incurrence, assumption or guarantee by a Venture Entity of
Indebtedness (as defined below) in excess of US$50 million in any single
transaction or series of related transactions; and

         (d) Appointment or removal of the President of the Venture.

SECTION 1.3. Actions Requiring a Special Vote of the Representatives.

         Notwithstanding Section 1.1(c), none of the following actions shall be
taken unless approved by at least one Representative of each of SLB and BHI, and
any such action so approved shall constitute the act or action of the Committee
with respect thereto:

         (a) Approval of new members to the Venture, or transfers of SLB's or
BHI's interest in the Venture, except, in each case, pursuant to the transfer
provisions in Article XI of the Master Formation Agreement dated as of September
6, 2000 by and among SLB, BHI and the Other Parties Listed on the Signature
Pages Thereto;

         (b) issuance of additional equity interests in a Venture Entity or US
EmployCo or any of their respective subsidiaries;

                                      -3-
<PAGE>   6

         (c) the approval of

                  (i)      (A) any aggregate deviations of greater than 15% from
                           the Venture's annual capital expenditures, including,
                           without limitation, acquisitions of businesses,
                           product lines and technology, set forth in its annual
                           business plan, (B) annual capital expenditures,
                           including, without limitation, acquisitions of
                           businesses, product lines and technology, in any such
                           plan in excess of 20% of annual plan revenues
                           (excluding, in each case, expenditures to acquire
                           speculative, non-exclusive proprietary or multiclient
                           seismic data) and (C) annual expenditures in excess
                           of 30% of annual business plan revenues in any
                           financial plan year on acquisition of speculative,
                           non-exclusive or multiclient seismic data;

                  (ii)     a Venture Entity's annual expenditures on research
                           and development expenses in excess of 5.0% of the
                           Venture's annual plan revenues;

                  (iii)    a Venture Entity's annual expenditures on general and
                           administrative expenses in relation to SLB and
                           Oilfield Services Headquarters corporate support in
                           excess of 1% of the Venture's annual plan revenues.

                  (iv)     a Venture Entity's expenditures in excess of US$5
                           million on any one contract between such Venture
                           Entity or any of its Affiliates, on the one hand, and
                           SLB, BHI or any of their respective Affiliates, on
                           the other hand, as well as the underlying contract;
                           provided that for this purpose if a contract is
                           reasonably likely to exceed this threshold even
                           though its value at the time of determining whether a
                           vote of the Representatives should be taken is less
                           than this threshold, the contract shall be treated as
                           having exceeded this threshold;

                  (v)      initiation, settlement or dismissal of lawsuits or
                           arbitral proceedings by or against a Venture Entity
                           or its subsidiaries (other than lawsuits involving
                           SLB, BHI or any of their respective Affiliates) where
                           the amount in controversy or settlement amount
                           exceeds US$25 million or where the rights of SLB or
                           BHI in the Venture Entity's technology for use
                           outside of the scope of the Venture Entity under the
                           licenses granted to that party are affected;
                           provided, that the Venture Entity or its Affiliates
                           may take any action necessary to preserve its rights
                           in a lawsuit or proceeding if time does not
                           practicably allow consultation with SLB and BHI to
                           obtain approval;

         (d) approval of

                  (i)      business, product line, asset or technology
                           dispositions whereby a Venture Entity receives in
                           consideration of the disposition US$30 million or
                           more; or

                                      -4-
<PAGE>   7

                  (ii)     the contribution of assets by a Venture Entity to an
                           entity jointly owned by the Venture Entity and one or
                           more third parties where the value of the
                           contribution of assets by the Venture Entity is US$30
                           million or more;

         (e) change in the scope or purpose of a Venture Entity or US EmployCo;

         (f) approval of distributions or dividends by a Venture Entity or US
EmployCo;

         (g) approval of

                  (i)      a Venture Entity's incurrence, assumption or
                           guarantee of Indebtedness in the aggregate in excess
                           of the greater of US$150 million or 10% of the
                           Venture's net worth (excluding any debt contributed
                           by either SLB or BHI at the creation of the Venture
                           Entity) as reflected on the most recent combined
                           financial statements of the Venture;

                  (ii)     a Venture Entity's incurrence, assumption or
                           guarantee of Indebtedness in any one transaction or
                           series of related transactions of US$100 million
                           (including through the establishment of committed or
                           uncommitted credit facilities) or more or the
                           creation of any Lien to secure the same;

         (h) approval of capital calls by a Venture Entity or US EmployCo;

         (i) amendments to the organizational documents of a Venture Entity or
US EmployCo;

         (j) approval of

                  (i)      the liquidation or dissolution of a Venture Entity or
                           US EmployCo; or

                  (ii)     any merger, consolidation or reorganization of a
                           Venture Entity or US EmployCo or any of their
                           respective subsidiaries (except for mergers,
                           consolidations or reorganizations of subsidiaries of
                           a Venture Entity or US EmployCo with other
                           subsidiaries of a Venture Entity or US EmployCo or
                           with a Venture Entity or US EmployCo when the Venture
                           Entity or US EmployCo is the surviving entity);

         (k) the filing by a Venture Entity or US EmployCo or any of their
respective subsidiaries for protection from creditors under the applicable law
of bankruptcy or reorganization for debtors or the making of an assignment for
the benefit of creditors;

         (l) any write-off or write-down of the value of any assets of a Venture
Entity or US EmployCo, or any non-recurring charge, in each case, in excess of
US$20 million on a pre-tax basis;

         (m) any change in the independent auditors of a Venture Entity or US
EmployCo, or the adoption of or material change in any accounting policies of a
Venture Entity or US EmployCo;

                                      -5-
<PAGE>   8

         (n) the determination of compensation of Executive Officers of a
Venture Entity or US EmployCo; and

         (o) the adoption of or material change to a Venture Entity's or US
EmployCo's corporate policies.

"AFFILIATE" means any entity that directly or indirectly controls, is controlled
by, or is under common control with, any other entity. For the purposes of this
definition, "CONTROL" means the power to direct the management and affairs of an
entity or to vote 50% or more of the securities or other equity interests having
ordinary voting power with respect to an entity. For this purpose, a Venture
Entity, US EmployCo and their respective subsidiaries shall not be Affiliates of
any Shareholder.

"EXECUTIVE OFFICERS" means the senior management of the Venture.

"GUARANTEE" by any Person means any obligation, contingent or otherwise, of such
Person directly or indirectly guaranteeing any Indebtedness or other obligation
of any other Person or, in any manner, providing for the payment of any
Indebtedness or other obligation of any other Person or otherwise protecting the
holder of such Indebtedness or other obligation against loss (whether arising by
virtue of partnership arrangements, by obtaining letters of credit, by agreement
to keep-well, to purchase assets, goods, securities or services, or to
take-or-pay or otherwise), provided that the term "GUARANTEE" shall not include
endorsements for collection or deposit in the ordinary course of business.

"INDEBTEDNESS" of any Person means, without duplication, (a) all obligations of
such Person for borrowed money or with respect to deposits or advances of any
kind, (b) all obligations of such Person evidenced by bonds, debentures, notes
or similar instruments, (c) all obligations of such Person upon which interest
charges are customarily paid, (d) all obligations of such Person under
conditional sale or other title retention agreements relating to property or
assets purchased by such Person, (e) all obligations of such Person issued or
assumed as the deferred purchase price of property or services (excluding trade
accounts payable, trade advertising and accrued obligations), (f) all
Indebtedness of others secured by (or for which the holder of such Indebtedness
has an existing right, contingent or otherwise, to be secured by) any Lien on
property owned or acquired by such Person, whether or not the obligations
secured thereby have been assumed, (g) all Guarantees by such Person of
Indebtedness of others, (h) all capital lease obligations of such Person, (i)
all obligations of such Person in respect of interest rate protection
agreements, foreign currency exchange agreements or other interest or exchange
rate hedging arrangements and (j) all obligations of such Person as an account
party in respect of letters of credit and bankers' acceptances. The Indebtedness
of any Person shall include the Indebtedness of any partnership in which such
Person is a general partner, other than to the extent that the instrument or
agreement evidencing such Indebtedness expressly limits the liability of such
Person in respect thereof.

"LIEN" means any mortgage, pledge, security interest, encumbrance, lien, claim,
irregularity, burden or defect.

                                      -6-
<PAGE>   9

"PERSON" means any corporation, limited liability company, individual, joint
stock company, joint venture, partnership, unincorporated association,
governmental authority or other entity.

"VENTURE" means the overall business relationship constituting a venture
contemplated by SLB and BHI and unless the context otherwise requires to the
contrary, the term "VENTURE" includes one or more of the Venture Entities, US
EmployCo or all of them on a consolidated basis.

SECTION 1.4. Appointments to Governing Bodies.

         The governing bodies of the Venture Entities and US EmployCo shall be
comprised of three members, two of which shall be appointed by SLB and one of
which shall be appointed by BHI.

SECTION 1.5. Indemnification.

         (a) The Venture Entities and US EmployCo shall, jointly and severally,
indemnify each Representative (each an "INDEMNIFIED PERSON") made or threatened
to be made a party to any threatened, pending or completed action, suit or
proceeding, whether civil, criminal, administrative or investigative, by reason
of the fact that he is or was a Representative, or is or was serving at the
written request of a Venture Entity or US EmployCo as a director, officer,
employee or agent of another corporation, limited liability company,
partnership, joint venture, trust or other enterprise, against any and all
claims, demands, losses, damages, fines, penalties (including interest),
liabilities, lawsuits and other proceedings, judgments and awards, and costs and
expenses (including but not limited to reasonable attorneys' fees)
(collectively, "DAMAGES") actually and reasonably incurred by him in connection
with such action, suit or proceeding if he acted in good faith, within the scope
of his duties and in a manner he reasonably believed to be in or not opposed to
the best interests of the Venture Entities and US EmployCo, and, with respect to
any criminal action or proceeding, had no reasonable cause to believe his
conduct was unlawful; provided, however, that no indemnification shall be given
to any Representative in connection with any (i) intentional misconduct or
knowing violation of the law, (ii) transaction from which an improper benefit is
received or (iii) knowing and intentional misrepresentations by that person as
to the scope of his authority to bind the Venture Entities and US EmployCo. The
termination of any action, suit or proceeding by judgment, order, settlement,
conviction, or upon a plea of nolo contendere or its equivalent, shall not, of
itself, create a presumption that the Indemnified Person did not act in good
faith, within the scope of his duties and in a manner which he reasonably
believed to be in or not opposed to the best interests of the Venture Entities
and US EmployCo, and, with respect to any criminal action or proceeding, had no
reasonable cause to believe that his conduct was unlawful.

         (b) Any indemnification under paragraph (a) (unless ordered by a court,
in which case indemnification will be provided in accordance with such order)
shall be made by the Venture Entities or US EmployCo only as authorized in the
specific case upon a determination by the Committee that indemnification is
proper in the circumstances because the Indemnified Person has met the
applicable standard of conduct set forth in paragraph (a).

         (c) Expenses incurred by any such Indemnified Person in defending a
civil or criminal action, suit or proceeding may be paid by the Venture Entities
or US EmployCo in

                                      -7-
<PAGE>   10

advance of the final disposition of such action, suit or proceeding as
authorized by the Venture Entities or US EmployCo in the specific case upon
receipt of a formal undertaking by or on behalf of such Indemnified Person to
repay such amount unless it shall ultimately be determined that he is entitled
to be indemnified by the Venture Entities or US EmployCo as authorized herein.

         (d) The indemnification provided by this Section 1.5 shall not be
deemed exclusive of any other rights to which those seeking indemnification may
be entitled under any agreement of the Venture Entities or US EmployCo and shall
continue as to an Indemnified Person who has ceased to be a Representative and
shall inure to the benefit of the heirs, executors and administrators of such an
Indemnified Person.

         (e) The Venture Entities and US EmployCo shall have the power to
purchase and maintain insurance consistent with these indemnity provisions on
behalf of any person who is or was a Representative or is or was serving at the
request of a Venture Entity or US EmployCo as a director, officer, manager,
employee or agent of another corporation, limited liability company,
partnership, joint venture, trust or other enterprise against any liability
asserted against him and incurred by him in any such capacity, or arising out of
his status as such.

         (f) For purposes of this Section 1.5, references to "OTHER ENTERPRISES"
shall include employee benefit plans; references to "FINES" shall include any
excise taxes assessed on a person with respect to an employee benefit plan; and
references to "SERVING AT THE REQUEST OF A VENTURE ENTITY" shall include any
service as a Representative which imposes duties on, or involves services by,
such Representative with respect to an employee benefit plan, its participants,
or beneficiaries; and a person who acted in good faith and in a manner he
reasonably believed to be in the interest of the participants and beneficiaries
of an employee benefit plan shall be deemed to have acted in a manner "NOT
OPPOSED TO THE BEST INTERESTS OF THE VENTURE ENTITIES AND US EMPLOYCO" as
referred to in this Section 1.5.

SECTION 1.6. US EmployCo. If SLB or BHI (or any of their respective Affiliates)
shall acquire the interest of the other in the Venture Entities such that SLB or
BHI then owns 100% of the Venture, directly or indirectly, STC and BHI, or their
respective Affiliates, for so long as they are shareholders of US EmployCo,
shall cause US EmployCo to continue to provide services to the US Venture Entity
on the same terms as such services are being provided at the time of that
acquisition.

                                   ARTICLE II
                               GENERAL PROVISIONS

SECTION 2.1. Amendment.

         This Agreement may not be amended, altered or modified except by
agreement of the Shareholders.

SECTION 2.2. Notices.

         2.2.1. Addresses. All notices under this Agreement shall be in writing
and shall be delivered by personal service; certified or registered U.S. mail,
postage prepaid, return receipt

                                      -8-
<PAGE>   11

requested; nationally recognized overnight courier, courier charges prepaid; or
facsimile transmission (followed by telephone confirmation of receipt) to
Schlumberger, Baker Hughes and to the Shareholders at the addresses herein set
forth and to the Representatives at the addresses therefor previously provided
to the notifying party or, if no such address is provided, to the appointing
party thereof.

         The addresses for notices are as follows:

                    If to Schlumberger, at:

                    Schlumberger Limited
                    277 Park Avenue
                    New York, New York 10172-2066
                    Facsimile: 212.350.8127
                    Attention: General Counsel

                    If to STC, at:

                    Schlumberger Technology Corporation
                    300 Schlumberger Drive
                    Sugar Land, Texas 77478
                    Attention: President

                    If to SPLC, at:

                    Schlumberger Plc
                    8th Floor, South Quay Plaza 2
                    183 Marsh Wall
                    London E14 95H, United Kingdom
                    Attention: President

                    If to SLBV, at:

                    Schlumberger B.V.
                    Parkstraat 83-89
                    2514 JG
                    The Hague, The Netherlands
                    Attention: President

                                      -9-
<PAGE>   12

                    If to SOHL, at:

                    Schlumberger Oilfield Holdings Limited
                    c/o HWR Services
                    Craigmuir Chambers
                    P.O. Box 71
                    Road Town, Tortola, British Virgin Islands
                    Attention: President

                    If to Baker Hughes, at:

                    Baker Hughes Incorporated
                    3900 Essex Lane
                    Houston, Texas 77027
                    Facsimile: 713.439.8472
                    Attention: General Counsel

                    If to WAII, at:

                    Western Atlas International, Inc.
                    3900 Essex Lane
                    Houston, Texas 77027
                    Facsimile: 713.439.8472
                    Attention: General Counsel

                    If to BHL, at:

                    Baker Hughes (UK) Limited
                    3900 Essex Lane
                    Houston, Texas 77027
                    Facsimile: 713.439.8472
                    Attention: General Counsel

                    If to BHIB, at:

                    Baker Hughes International Branches Incorporated
                    3900 Essex Lane
                    Houston, Texas 77027
                    Facsimile: 713.439.8472
                    Attention: General Counsel

                    If to WSHL, at:

                    Western Sea Holdings Limited
                    3900 Essex Lane
                    Houston, Texas 77027
                    Facsimile: 713.439.8472
                    Attention: General Counsel

                                      -10-
<PAGE>   13

         2.2.2. Effective Date of Notices, etc. All notices, demands and
requests shall be effective upon actual receipt or, in the case of delivery by
facsimile transmission, the completion of such transmission during the normal
business hours of the recipient, in each case to the appropriate address set
forth in Section 2.2.1 above. Rejection or other refusal to accept or the
inability to deliver because of changed address of which no notice was given as
provided in Section 2.2.3 shall be deemed to be receipt of the notice, demand or
request sent.

         2.2.3. Changes. By giving the other parties or Representatives, as
applicable, at least 30 days' written notice thereof, the parties or
Representatives and their respective permitted successors and assigns shall have
the right from time to time and at any time during the term of this Agreement to
change their respective addresses for notices and each shall have the right to
specify as its address for notices any other address.

SECTION 2.3. Validity.

         In the event that any provision of this Agreement shall be held to be
invalid or unenforceable, the same shall not affect in any respect whatsoever
the validity or enforceability of the remainder of this Agreement.

SECTION 2.4. Survival of Rights.

         Except as provided herein to the contrary, this Agreement shall be
binding upon and inure to the benefit of the parties and their permitted
successors and assigns.

SECTION 2.5. Governing Law.

         This Agreement and the rights and liabilities of the parties shall be
governed by and construed in accordance with the laws of the State of Texas,
United States of America.

SECTION 2.6. Waiver.

         No consent or waiver, express or implied, by a party to or of any
breach or default by any other party in the performance by such other party of
its obligations hereunder shall be deemed or construed to be a consent or waiver
to or of any other breach or default in the performance by such other party of
the same or any other obligations of such other party hereunder. Failure on the
part of a party to complain of any act or failure to act of any other party or
to declare any other party in default, irrespective of how long such failure
continues, shall not constitute a waiver by such party of its rights hereunder.
The giving of consent by a party in any one instance shall not limit or waive
the necessity to obtain such party's consent in any future instance.

                                      -11-
<PAGE>   14

SECTION 2.7. Remedies in Equity.

         The rights and remedies of any party hereunder shall not be mutually
exclusive, and the exercise of one or more rights or remedies shall not preclude
the exercise of any other rights or remedies. Each of the parties confirms that
damages at law will be an inadequate remedy for a breach or threatened breach of
this Agreement and agrees that, except as expressly provided to the contrary in
this Agreement, in the event of a breach or threatened breach of any provision
hereof, the respective rights and obligations hereunder shall be enforceable by
specific performance, injunction or other equitable remedy, but nothing herein
contained is intended to, nor shall it, limit or affect any rights at law or by
statute or otherwise of any party aggrieved as against another for a breach or
threatened breach of any provision hereof, it being the intention by this
Section 2.7 to make clear the agreement of the parties that the respective
rights and obligations of the parties hereunder, except as expressly provided to
the contrary herein, shall be enforceable in equity as well as at law or
otherwise.

SECTION 2.8. Terminology.

         All personal pronouns used in this Agreement, whether used in the
masculine, feminine, or neuter gender, shall include all other genders; and the
singular shall include the plural and vice versa. Titles of Articles and
Sections are for convenience only, and neither limit nor amplify the provisions
of this Agreement itself. The term "PARTIES" shall mean SLB, BHI and the
Shareholders and the term "PARTY" shall mean any one of them.

SECTION 2.9. Counterparts.

         This Agreement may be executed in any number of counterparts, each of
which shall be deemed to be an original and all of which shall constitute one
and the same agreement.

SECTION 2.10. Further Assurances.

         Each party agrees to do all acts and things and to make, execute and
deliver such written instruments, as shall from time to time be reasonably
required to carry out the terms and provisions of this Agreement.

                     [THIS SPACE INTENTIONALLY LEFT BLANK.]

                                      -12-
<PAGE>   15

IN WITNESS WHEREOF, the parties have executed this Agreement as of the day and
year first above set forth.

                                Schlumberger Limited

                                By: /s/ Robert Villard
                                    --------------------------------------------
                                    Robert Villard
                                    Attorney-in-Fact

                                Schlumberger Technology Corporation

                                By: /s/ John Yearwood
                                    --------------------------------------------
                                    John Yearwood
                                    Attorney-in-Fact

                                Schlumberger Plc

                                By: /s/ Robert Villard
                                    --------------------------------------------
                                    Robert Villard
                                    Attorney-in-Fact

                                Schlumberger B.V.

                                By: /s/ Robert Villard
                                    --------------------------------------------
                                    Robert Villard
                                    Attorney-in-Fact

                                Schlumberger Oilfield Holdings Limited

                                By: /s/ Robert Villard
                                    --------------------------------------------
                                    Robert Villard
                                    Attorney-in-Fact

<PAGE>   16

                                Baker Hughes Incorporated

                                By: /s/ John H. Lohman, Jr.
                                    --------------------------------------------
                                    John H. Lohman, Jr.
                                    Vice President

                                Western Atlas International, Inc.

                                By: /s/ Peter J. Woolley
                                    --------------------------------------------
                                    Peter J. Woolley
                                    Vice President

                                Baker Hughes (UK) Limited

                                By: /s/ Peter J. Woolley
                                    --------------------------------------------
                                    Peter J. Woolley
                                    Director

                                Baker Hughes International Branches Incorporated

                                By: /s/ Gavin Sinclair
                                    --------------------------------------------
                                    Gavin Sinclair
                                    Vice President

                                Western Sea Holdings Limited

                                By: /s/ Peter J. Woolley
                                    --------------------------------------------
                                    Peter J. Woolley
                                    President

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