Delaware
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76-0207995
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(State or other jurisdiction of incorporation or organization)
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(I.R.S. Employer Identification No.)
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17021 Aldine Westfield Road, Houston, Texas
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77073-5101
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(Address of principal executive offices)
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(Zip Code)
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Title of each class
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Name of each exchange on which registered
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Common Stock, $1 Par Value per Share
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New York Stock Exchange
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SIX Swiss Exchange
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Large accelerated filer [X]
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Accelerated filer [ ]
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Non-accelerated filer [ ]
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Smaller reporting company [ ]
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Page
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•
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Drill Bits
- Includes Tricone
™
roller cone drill bits, polycrystalline diamond composite (PDC or "diamond" drill bits, Kymera
™
hybrid drill bits and related cutter technology used for performance drilling, hole enlargement and coring.
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•
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Drilling Services
- Includes directional drilling systems and services (rotary steerables, drilling motors, measurement-while-drilling (MWD) systems, etc.), logging-while-drilling (LWD) systems and services (resistivity, imaging, pressure testing and sampling, etc.), surface logging and coring systems and services, and geoscience services.
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•
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Wireline Services
- Includes both open hole (imaging, fluids sampling, etc.) and cased hole (production logging, wellbore integrity, pipe recovery, etc.) well logging services.
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•
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Drilling and Completion Fluids
- Includes emulsion (oil-based) and water-based drilling fluids systems; reservoir drill-in fluids; completion fluids, and fluids environmental services.
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•
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Completion Systems
- Includes products and services used to control the flow of hydrocarbons within a wellbore including upper completions (packers, liner hangers, safety systems, etc.), lower completions (sand screens, tubing conveyed perforating, etc.) and unconventional multistage completion systems (frac plugs, frac balls, etc.).
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•
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Intelligent Production Systems
- Includes products, services, and software used to monitor, analyze, and dynamically control production to optimize returns and ultimate recovery (production decisions services, chemical injection service, well monitoring services, intelligent well systems, and artificial lift monitoring).
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•
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Wellbore Intervention
- Includes products and services used to intervene in existing wellbores to improve production and solve problems within the well (fishing services, wellbore cleanup, casing exit systems, workover systems, smart interventional technologies, and through-tubing intervention tools).
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•
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Artificial Lift
- Includes products and services used to maintain production, improve recovery rates, and lower operating costs in wells in which a reservoir can no longer flow naturally (in-well electric submersible pumping systems; progressing cavity pump systems; gas lift systems); and horizontal surface pumping systems that move fluids on the surface for applications such as injection, disposal, transfer, and pipeline boosting.
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•
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Upstream Chemicals
- Includes chemical technologies and services that solve production challenges related to flow assurance, production optimization, asset integrity, and water management.
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•
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Pressure Pumping
- Includes onshore and offshore cementing, stimulation services (hydraulic fracturing, acidizing, stimulation vessels, etc.) and coiled tubing services used in the completion of new oil and natural gas wells and in remedial work on existing wells. Hydraulic fracturing is the practice of pumping fluid through a wellbore at pressures and rates sufficient to crack rock in the target formation, extend the cracks, and leave behind a propping agent to keep the cracks open after pumping ceases.
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•
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The severity and duration of both the summer and the winter in North America can have a significant impact on activity levels. In Canada, the timing and duration of the spring thaw directly affects activity levels, which
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•
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Adverse weather conditions such as hurricanes and typhoons can disrupt coastal and offshore drilling and production operations.
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•
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Severe weather during the winter months normally results in reduced activity levels in the North Sea and Russia generally in the first quarter.
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•
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Scheduled repair and maintenance of offshore facilities in the North Sea can reduce activity in the second and third quarters.
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•
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Many of our international oilfield customers increase orders for certain products and services in the fourth quarter.
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•
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Our Industrial Services segment typically experiences lower sales during the first and fourth quarters of the year due to the Northern Hemisphere winter.
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Name
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Age
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Background
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Martin S. Craighead
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57
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Chairman of the Board of Directors of the Company since April 2013 and Director since 2011. Chief Executive Officer of the Company since January 2012 and President since 2010. Chief Operating Officer from 2009 to 2012. Group President of Drilling and Evaluation from 2007 to 2009. President of INTEQ from 2005 to 2007 and President of Baker Atlas from February 2005 to August 2005. Employed by the Company in 1986.
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Kimberly A. Ross
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51
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Senior Vice President and Chief Financial Officer of the Company since October 2014. Executive Vice President and Chief Financial Officer of Avon Products Incorporated from 2011 to 2014. Executive Vice President and Chief Financial Officer of Royal Ahold N.V. from 2007 to 2011 and various other finance positions with Royal Ahold from 2001 to 2007. Ms. Ross serves on the board of directors and the audit committee of Chubb Limited. Employed by the Company in October 2014.
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Belgacem Chariag
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54
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President, Global Operations since May 2016. Chief Integration Officer from December 2014 to May 2016. President, Global Products and Services of the Company from October 2013 to December 2014. President, Eastern Hemisphere Operations from 2009 to 2013. Vice President/Director HSE of Schlumberger Limited from May 2008 to May 2009. Various other executive positions at Schlumberger from 1989 to 2008. Employed by the Company in 2009.
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Archana Deskus
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51
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Vice President and Chief Information Officer of the Company since 2013. Vice President and Chief Information Officer for Ingersoll-Rand from 2011 to 2012. Senior Vice President and Chief Information Officer for Timex Group from 2006 to 2011. Various positions at United Technologies from 1987 to 2006, including Vice President and Chief Information Officer for Carrier North America. Employed by the Company in 2013.
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Jack Hinton
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63
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Vice President, Health, Safety and Environment since 2015. Vice President, Enterprise Solutions at the Company from 2011 to 2014 and Director Health, Safety and Environment at the Company from 2005 to 2010. Dean and professor at the Kazakhstan Institute of Management, Economics and Strategic Research from 200
4
to 2005. He previously spent 26 years at Texaco in various Health, Safety and Environment leadership roles. Employed by the
Company in 2005.
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Kelly C. Janzen
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44
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Vice President, Controller and Chief Accounting Officer since September 2016. Vice President, Finance and Chief Accounting Officer for McDermott International from December 2014 to August 2016. Distributed Power Global Controller at General Electric Company ("GE") from April 2013 to November 2014 and Operational Controller, Global Growth and Operations at GE from August 2011 to April 2013. Various corporate roles at GE from 2007 to 2011. Employed by the Company in 2016.
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Murali Kuppuswamy
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55
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Chief Human Resources Officer since May 2016. Vice President, Human Resources for Europe, Africa and Russia Caspian from December 2013 through May 2016. Vice President, Human Resources for Global Products and Technology from September 2011 through December 2013. Various human resources leadership roles at GE from 1993 to 2011. Employed by the Company in 2011.
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William D. Marsh
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54
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Vice President and General Counsel of the Company since February 2013. Vice President-Legal for Western Hemisphere from May 2009 to February 2013. Various executive, legal and corporate roles within the Company from 1998 to 2009. Partner at Ballard Spahr LLP from 1997 to 1998. Mr. Marsh serves on the Board of Directors of People's Utah Bancorp (bank holding company). Employed by the Company in 1998.
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Jay G. Martin
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65
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Vice President, Chief Compliance Officer and Senior Deputy General Counsel of the Company since 2004. Shareholder at Winstead Sechrest & Minick P.C. from 2001 to 2004. Employed by the Company in 2004.
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Derek Mathieson
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46
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Chief Commercial Officer since May 2016. Chief Technology and Marketing Officer of the Company from September 2015 to May 2016 and Chief Strategy Officer from October 2013 to September 2015. President Western Hemisphere Operations from 2012 to 2013. President, Products and Technology from May 2009 to January 2012. Chief Technology and Marketing Officer of the Company from December 2008 to May 2009. Employed by the Company in 2008.
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Arthur L. Soucy
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54
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President, Products and Technology from May 2016. President, Europe, Africa and Russia Caspian Region of the Company from 2013 to May 2016. President, Global Products and Services from 2012 to 2013. Vice President Supply Chain of the Company from April 2009 to January 2012. Vice President, Global Supply Chain for Pratt and Whitney from 2007 to 2009. Employed by the Company in 2009.
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•
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we may not be able to continue to obtain insurance on commercially reasonable terms;
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•
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we may be faced with types of liabilities that will not be covered by our insurance;
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•
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our insurance carriers may not be able to meet their obligations under the policies; or
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•
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the dollar amount of any liabilities may exceed our policy limits.
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•
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the attention of our management may have been diverted to the GE Transaction instead of on our operations and pursuit of other opportunities that may have been beneficial to us;
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•
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resulting negative customer perception could adversely affect our ability to compete for, or to win, new and renewal business in the marketplace;
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•
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we and our stockholders would not realize the anticipated benefits of the GE Transaction, including a special one-time cash dividend of $17.50 per share of Newco Class A Common Stock and any anticipated synergies from combining our business with GE O&G;
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•
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we may be required to pay a termination fee of $750 million if the Transaction Agreement is terminated in the case of certain events described in the Transaction Agreement, including due to an adverse change in our board of directors' recommendation to our stockholders to approve the GE Transaction;
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•
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the trading price of our common stock may experience increased volatility to the extent that the current market prices reflect a market assumption that the GE Transaction will be completed; or
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•
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the Company could be subject to litigation from shareholders related to the Transaction Agreement.
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•
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the inability to successfully integrate the two businesses, including operations, technologies, products and services, in a manner that permits New Baker Hughes to achieve the cost savings and operating synergies anticipated to result from the GE Transaction, which could result in the anticipated benefits of the GE Transaction not being realized partly or wholly in the time frame currently anticipated or at all;
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•
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lost sales and customers as a result of certain customers of either or both of the two businesses deciding not to do business with New Baker Hughes, or deciding to decrease their amount of business in order to reduce their reliance on a single company;
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•
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the necessity of coordinating geographically separated organizations, systems and facilities;
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•
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potential unknown liabilities and unforeseen increased expenses, delays or regulatory conditions associated with the GE Transaction;
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•
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integrating personnel with diverse business backgrounds and business cultures, while maintaining focus on providing consistent, high-quality products and services;
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•
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consolidating and rationalizing information technology platforms and administrative infrastructures as well as accounting systems and related financial reporting activities;
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•
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preserving important relationships of both Baker Hughes and GE O&G and resolving potential conflicts that may arise; and
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•
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performance shortfalls at one or both of Baker Hughes and GE O&G as a result of the diversion of management's attention caused by completing the GE Transaction and integrating the two businesses' operations.
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North America:
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Houston, Pasadena, and The Woodlands, Texas; Broken Arrow, Claremore, Tulsa and Sand Springs, Oklahoma; Bossier City, Broussard, and Lafayette, Louisiana - all located in the United States; and Leduc, Canada
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Europe/Africa/Russia Caspian:
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Aberdeen, Scotland; Liverpool, England; Celle, Germany; Tananger, Norway; Port Harcourt, Nigeria; Luanda, Angola; Tyumen and Novosibirsk, Russia
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Middle East/Asia Pacific:
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Dubai, United Arab Emirates; Dhahran, Saudi Arabia; Singapore, Singapore; Chonburi, Thailand; and Hsinchu, Taiwan
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Industrial Services:
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Pasadena, Texas; Sand Springs and Barnsdall, Oklahoma; Taft, California; and Liverpool, England
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•
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On November 24, 2014, Gary Molenda, a purported shareholder of the Company, filed a class action lawsuit in the Court of Chancery of the State of Delaware ("Delaware Chancery Court") against Baker Hughes, the Company's Board of Directors, Halliburton, and Red Tiger LLC, a wholly owned subsidiary of Halliburton ("Red Tiger" and together with all defendants, "Defendants") styled Gary R. Molenda v. Baker Hughes, Inc., et al., Case No. 10390-CB.
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•
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On November 26, 2014, a second purported shareholder of the Company, Booth Family Trust, filed a substantially similar class action lawsuit in Delaware Chancery Court.
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•
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On December 1, 2014, New Jersey Building Laborers Annuity Fund and James Rice, two additional purported shareholders of the Company, filed substantially similar class action lawsuits in Delaware Chancery Court.
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•
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On December 10, 2014, a fifth purported shareholder of the Company, Iron Workers Mid-South Pension Fund, filed another substantially similar class action lawsuit in the Delaware Chancery Court.
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•
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On December 24, 2014, a sixth purported shareholder of the Company, Annette Shipp, filed another substantially similar class action lawsuit in the Delaware Chancery Court.
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Period
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Total Number
of Shares
Purchased (1) |
|
Average
Price Paid
Per Share
(1)
|
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Total Number of
Shares Purchased as
Part of a Publicly
Announced Program
(2)
|
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Maximum Dollar Value
of Shares that May Yet Be
Purchased Under the Program
(3)
|
|||||
October 1-31, 2016
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9,640
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$
|
52.35
|
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—
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$
|
1,237,161,230
|
|
November 1-30, 2016
|
—
|
|
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—
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|
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—
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$
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1,237,161,230
|
|
|
December 1-31, 2016
|
69,214
|
|
|
64.71
|
|
|
—
|
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$
|
1,237,161,230
|
|
|
Total
|
78,854
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|
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$
|
63.20
|
|
|
—
|
|
|
(1)
|
Represents shares purchased from employees to satisfy the tax withholding obligations in connection with the vesting of restricted stock awards and restricted stock units.
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(2)
|
There were no repurchases during the fourth quarter of 2016 under our previously announced purchase program.
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(3)
|
Under the transaction agreement with General Electric, as described in Note 3. "General Electric Transaction Agreement" of the Notes to Consolidated Financial Statements in Item 8 herein, we have agreed not to repurchase any shares of our common stock other than in connection with shares repurchased from employees to satisfy the tax withholding obligations in connection with the vesting of equity awards.
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2011
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2012
|
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2013
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2014
|
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2015
|
|
2016
|
||||||||||||
Baker Hughes
|
$
|
100.00
|
|
|
$
|
85.18
|
|
|
$
|
116.65
|
|
|
$
|
119.55
|
|
|
$
|
99.62
|
|
|
$
|
142.17
|
|
S&P 500 Index
|
100.00
|
|
|
115.93
|
|
|
153.39
|
|
|
174.29
|
|
|
176.75
|
|
|
197.75
|
|
||||||
S&P 500 Oil and Gas Equipment and Services Index
|
100.00
|
|
|
100.00
|
|
|
130.65
|
|
|
120.46
|
|
|
97.87
|
|
|
129.12
|
|
|
Year Ended December 31,
|
||||||||||||||||||
(In millions, except per share amounts)
|
2016
|
|
|
2015
|
|
|
2014
|
|
|
2013
|
|
|
2012
|
|
|||||
Revenue
|
$
|
9,841
|
|
|
$
|
15,742
|
|
|
$
|
24,551
|
|
|
$
|
22,364
|
|
|
$
|
21,361
|
|
Gross Profit
|
(516
|
)
|
|
861
|
|
|
4,192
|
|
|
3,255
|
|
|
3,508
|
|
|||||
Marketing, general and administrative
|
815
|
|
|
969
|
|
|
1,333
|
|
|
1,306
|
|
|
1,316
|
|
|||||
Impairment and restructuring charges
(1)
|
1,735
|
|
|
1,993
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||
Goodwill impairment
(2)
|
1,858
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||
Merger and related costs
|
199
|
|
|
295
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||
Merger termination fee
(3)
|
(3,500
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||
Operating (loss) income
|
(1,623
|
)
|
|
(2,396
|
)
|
|
2,859
|
|
|
1,949
|
|
|
2,192
|
|
|||||
Non-operating expense, net
|
(417
|
)
|
|
(217
|
)
|
|
(232
|
)
|
|
(234
|
)
|
|
(210
|
)
|
|||||
(Loss) income before income taxes
|
(2,040
|
)
|
|
(2,613
|
)
|
|
2,627
|
|
|
1,715
|
|
|
1,982
|
|
|||||
Income tax (provision) benefit
|
(696
|
)
|
|
639
|
|
|
(896
|
)
|
|
(612
|
)
|
|
(665
|
)
|
|||||
Net (loss) income
|
(2,736
|
)
|
|
(1,974
|
)
|
|
1,731
|
|
|
1,103
|
|
|
1,317
|
|
|||||
Net (income) loss attributable to noncontrolling interests
|
(2
|
)
|
|
7
|
|
|
(12
|
)
|
|
(7
|
)
|
|
(6
|
)
|
|||||
Net (loss) income attributable to Baker Hughes
|
$
|
(2,738
|
)
|
|
$
|
(1,967
|
)
|
|
$
|
1,719
|
|
|
$
|
1,096
|
|
|
$
|
1,311
|
|
Per share of common stock:
|
|
|
|
|
|
|
|
|
|
||||||||||
Net (loss) income attributable to Baker Hughes:
|
|
|
|
|
|
|
|
|
|
||||||||||
Basic
|
$
|
(6.31
|
)
|
|
$
|
(4.49
|
)
|
|
$
|
3.93
|
|
|
$
|
2.47
|
|
|
$
|
2.98
|
|
Diluted
|
(6.31
|
)
|
|
(4.49
|
)
|
|
3.92
|
|
|
2.47
|
|
|
2.97
|
|
|||||
Dividends
|
0.68
|
|
|
0.68
|
|
|
0.64
|
|
|
0.60
|
|
|
0.60
|
|
|||||
Balance Sheet Data:
|
|
|
|
|
|
|
|
|
|
||||||||||
Cash, cash equivalents and short-term investments
|
$
|
4,572
|
|
|
$
|
2,324
|
|
|
$
|
1,740
|
|
|
$
|
1,399
|
|
|
$
|
1,015
|
|
Working capital (current assets minus current liabilities)
|
6,863
|
|
|
6,493
|
|
|
7,408
|
|
|
6,717
|
|
|
6,293
|
|
|||||
Total assets
|
19,034
|
|
|
24,080
|
|
|
28,827
|
|
|
27,934
|
|
|
26,689
|
|
|||||
Long-term debt
|
2,886
|
|
|
3,890
|
|
|
3,913
|
|
|
3,882
|
|
|
3,837
|
|
|||||
Total equity
|
12,737
|
|
|
16,382
|
|
|
18,730
|
|
|
17,912
|
|
|
17,268
|
|
(1)
|
Impairment and restructuring charges associated with asset impairments, workforce reductions, facility closures and contract terminations recorded during 2015 and 2016. See Note 4. "Impairment and Restructuring Charges" of the Notes to Consolidated Financial Statements in Item 8 herein for further discussion.
|
(2)
|
Goodwill impairment recognized in the second and third quarters of 2016. See Note 12. "Goodwill and Intangible Assets" of the Notes to Consolidated Financial Statements in Item 8 herein for further discussion.
|
(3)
|
Merger termination fee received from Halliburton. See Note 2. "Halliburton Terminated Merger Agreement" of the Notes to Consolidated Financial Statements in Item 8 herein for further discussion.
|
|
2016
|
|
2015
|
|
2014
|
||||||
Brent oil prices ($/Bbl)
(1)
|
$
|
44.11
|
|
|
$
|
52.31
|
|
|
$
|
98.88
|
|
WTI oil prices ($/Bbl)
(2)
|
43.34
|
|
|
48.68
|
|
|
93.03
|
|
|||
Natural gas prices ($/mmBtu)
(3)
|
2.49
|
|
|
2.61
|
|
|
4.35
|
|
(1)
|
Bloomberg Dated Brent ("Brent") Oil Spot Price per Barrel
|
(2)
|
Bloomberg West Texas Intermediate ("WTI") Cushing Crude Oil Spot Price per Barrel
|
(3)
|
Bloomberg Henry Hub Natural Gas Spot Price per million British Thermal Unit
|
|
2016
|
|
2015
|
|
2014
|
|||
U.S. - onshore
|
490
|
|
|
948
|
|
|
1,804
|
|
U.S. - offshore
|
23
|
|
|
36
|
|
|
57
|
|
Canada
|
129
|
|
|
194
|
|
|
379
|
|
North America
|
642
|
|
|
1,178
|
|
|
2,240
|
|
Latin America
|
198
|
|
|
319
|
|
|
397
|
|
North Sea
|
28
|
|
|
37
|
|
|
40
|
|
Continental Europe
|
68
|
|
|
80
|
|
|
105
|
|
Africa
|
85
|
|
|
106
|
|
|
134
|
|
Middle East
|
390
|
|
|
406
|
|
|
406
|
|
Asia Pacific
|
187
|
|
|
220
|
|
|
254
|
|
Outside North America
|
956
|
|
|
1,168
|
|
|
1,336
|
|
Worldwide
|
1,598
|
|
|
2,346
|
|
|
3,576
|
|
|
Year Ended December 31,
|
|
|
|||||||||||
|
2016
|
|
2015
|
|
$ Change
|
|
% Change
|
|||||||
Revenue:
|
|
|
|
|
|
|
|
|||||||
North America
|
$
|
2,936
|
|
|
$
|
6,009
|
|
|
$
|
(3,073
|
)
|
|
(51
|
)%
|
Latin America
|
980
|
|
|
1,799
|
|
|
(819
|
)
|
|
(46
|
)%
|
|||
Europe/Africa/Russia Caspian
|
2,201
|
|
|
3,278
|
|
|
(1,077
|
)
|
|
(33
|
)%
|
|||
Middle East/Asia Pacific
|
2,705
|
|
|
3,441
|
|
|
(736
|
)
|
|
(21
|
)%
|
|||
Industrial Services
|
1,019
|
|
|
1,215
|
|
|
(196
|
)
|
|
(16
|
)%
|
|||
Total
|
$
|
9,841
|
|
|
$
|
15,742
|
|
|
$
|
(5,901
|
)
|
|
(37
|
)%
|
|
Year Ended December 31,
|
|
|
|
|
|||||||||
|
2016
|
|
2015
|
|
$ Change
|
|
% Change
|
|||||||
Operating Profit (Loss) Before Tax:
|
|
|
|
|
|
|
|
|||||||
North America
|
$
|
(687
|
)
|
|
$
|
(639
|
)
|
|
$
|
(48
|
)
|
|
(8
|
)%
|
Latin America
|
(276
|
)
|
|
144
|
|
|
(420
|
)
|
|
(292
|
)%
|
|||
Europe/Africa/Russia Caspian
|
(273
|
)
|
|
183
|
|
|
(456
|
)
|
|
(249
|
)%
|
|||
Middle East/Asia Pacific
|
69
|
|
|
229
|
|
|
(160
|
)
|
|
(70
|
)%
|
|||
Industrial Services
|
(6
|
)
|
|
108
|
|
|
(114
|
)
|
|
(106
|
)%
|
|||
Total Operations
|
(1,173
|
)
|
|
25
|
|
|
(1,198
|
)
|
|
N/M
|
|
|||
Corporate
|
(158
|
)
|
|
(133
|
)
|
|
(25
|
)
|
|
19
|
%
|
|||
Loss on sale of business interest
|
(97
|
)
|
|
—
|
|
|
(97
|
)
|
|
N/M
|
|
|||
Loss on early extinguishment of debt
|
(142
|
)
|
|
—
|
|
|
(142
|
)
|
|
N/M
|
|
|||
Interest expense, net
|
(178
|
)
|
|
(217
|
)
|
|
39
|
|
|
(18
|
)%
|
|||
Impairment and restructuring charges
|
(1,735
|
)
|
|
(1,993
|
)
|
|
258
|
|
|
(13
|
)%
|
|||
Goodwill impairment
|
(1,858
|
)
|
|
—
|
|
|
(1,858
|
)
|
|
N/M
|
|
|||
Merger and related costs
|
(199
|
)
|
|
(295
|
)
|
|
96
|
|
|
(33
|
)%
|
|||
Merger termination fee
|
3,500
|
|
|
—
|
|
|
3,500
|
|
|
N/M
|
|
|||
Total
|
$
|
(2,040
|
)
|
|
$
|
(2,613
|
)
|
|
$
|
573
|
|
|
(22
|
)%
|
|
Year Ended December 31,
|
|
|
|||||||||||
|
2015
|
|
2014
|
|
$ Change
|
|
% Change
|
|||||||
Revenue:
|
|
|
|
|
|
|
|
|||||||
North America
|
$
|
6,009
|
|
|
$
|
12,078
|
|
|
$
|
(6,069
|
)
|
|
(50
|
)%
|
Latin America
|
1,799
|
|
|
2,236
|
|
|
(437
|
)
|
|
(20
|
)%
|
|||
Europe/Africa/Russia Caspian
|
3,278
|
|
|
4,417
|
|
|
(1,139
|
)
|
|
(26
|
)%
|
|||
Middle East/Asia Pacific
|
3,441
|
|
|
4,456
|
|
|
(1,015
|
)
|
|
(23
|
)%
|
|||
Industrial Services
|
1,215
|
|
|
1,364
|
|
|
(149
|
)
|
|
(11
|
)%
|
|||
Total
|
$
|
15,742
|
|
|
$
|
24,551
|
|
|
$
|
(8,809
|
)
|
|
(36
|
)%
|
|
Year Ended December 31,
|
|
|
|
|
|||||||||
|
2015
|
|
2014
|
|
$ Change
|
|
% Change
|
|||||||
Operating Profit (Loss) Before Tax:
|
|
|
|
|
|
|
|
|||||||
North America
|
$
|
(639
|
)
|
|
$
|
1,466
|
|
|
$
|
(2,105
|
)
|
|
(144
|
)%
|
Latin America
|
144
|
|
|
290
|
|
|
(146
|
)
|
|
(50
|
)%
|
|||
Europe/Africa/Russia Caspian
|
183
|
|
|
621
|
|
|
(438
|
)
|
|
(71
|
)%
|
|||
Middle East/Asia Pacific
|
229
|
|
|
675
|
|
|
(446
|
)
|
|
(66
|
)%
|
|||
Industrial Services
|
108
|
|
|
119
|
|
|
(11
|
)
|
|
(9
|
)%
|
|||
Total Operations
|
25
|
|
|
3,171
|
|
|
(3,146
|
)
|
|
(99
|
)%
|
|||
Corporate
|
(133
|
)
|
|
(312
|
)
|
|
179
|
|
|
(57
|
)%
|
|||
Interest expense, net
|
(217
|
)
|
|
(232
|
)
|
|
15
|
|
|
(6
|
)%
|
|||
Impairment and restructuring charges
|
(1,993
|
)
|
|
—
|
|
|
(1,993
|
)
|
|
N/M
|
|
|||
Merger and related costs
|
(295
|
)
|
|
—
|
|
|
(295
|
)
|
|
N/M
|
|
|||
Total
|
$
|
(2,613
|
)
|
|
$
|
2,627
|
|
|
$
|
(5,240
|
)
|
|
(199
|
)%
|
|
2016
|
|
2015
|
|
2014
|
|||||||||||||||
|
$
|
|
%
|
|
$
|
|
%
|
|
$
|
|
%
|
|||||||||
Revenue
|
$
|
9,841
|
|
|
100
|
%
|
|
$
|
15,742
|
|
|
100
|
%
|
|
$
|
24,551
|
|
|
100
|
%
|
Cost of revenue
|
9,973
|
|
|
101
|
%
|
|
14,415
|
|
|
92
|
%
|
|
19,746
|
|
|
80
|
%
|
|||
Research and engineering
|
384
|
|
|
4
|
%
|
|
466
|
|
|
3
|
%
|
|
613
|
|
|
2
|
%
|
|||
Marketing, general and administrative
|
815
|
|
|
8
|
%
|
|
969
|
|
|
6
|
%
|
|
1,333
|
|
|
5
|
%
|
|||
Impairment and restructuring charges
|
1,735
|
|
|
18
|
%
|
|
1,993
|
|
|
13
|
%
|
|
—
|
|
|
—
|
%
|
|||
Goodwill impairment
|
1,858
|
|
|
19
|
%
|
|
—
|
|
|
—
|
%
|
|
—
|
|
|
—
|
%
|
|||
Merger and related costs
|
199
|
|
|
2
|
%
|
|
295
|
|
|
2
|
%
|
|
—
|
|
|
—
|
%
|
|||
Merger termination fee
|
(3,500
|
)
|
|
(36
|
)%
|
|
—
|
|
|
—
|
%
|
|
—
|
|
|
—
|
%
|
|||
Loss on sale of business interest
|
97
|
|
|
1
|
%
|
|
—
|
|
|
—
|
%
|
|
—
|
|
|
—
|
%
|
|||
Loss on early extinguishment of debt
|
142
|
|
|
1
|
%
|
|
—
|
|
|
—
|
%
|
|
—
|
|
|
—
|
%
|
|||
Interest expense, net
|
178
|
|
|
2
|
%
|
|
217
|
|
|
1
|
%
|
|
232
|
|
|
1
|
%
|
•
|
We have comprehensive internal policies over such areas as facilitating payments; travel, entertainment, gifts and charitable donations connected to non-U.S. government officials; payments to non-U.S. commercial sales representatives; and the use of non-U.S. police or military organizations for security purposes. In addition, we have country-specific guidance for customs standards, visa processing, export and re-export controls, economic sanctions and antiboycott laws.
|
•
|
We have a comprehensive employee compliance training program covering substantially all employees.
|
•
|
We have a due diligence procedure for commercial sales, processing and professional agents and an enhanced risk-based process for classifying distributors and suppliers.
|
•
|
We have continued our reduction of the use of commercial sales representatives and processing agents, including the reduction of customs agents.
|
•
|
We have a compliance governance committee, which includes senior officers of the Company, that reviews our effectiveness and compliance with processes and controls of the Company's global Compliance Program including all areas covered by the Business Code of Conduct.
|
•
|
We have a special compliance committee, which is made up of senior officers, that meets no less than once a year to review the oversight reports for all active commercial sales representatives.
|
•
|
We have compliance committees that have been formed and are operating successfully in all of the Company's geomarkets.
|
•
|
We use technology to monitor and report on compliance matters, including an internal investigations management software, a web-based antiboycott reporting tool and a global trade management software tool.
|
•
|
We have a compliance program designed to encourage reporting of any ethics or compliance matter without fear of retaliation including a worldwide business helpline operated by a third party and currently available toll-free in 150 languages to ensure that our helpline is easily accessible to employees in their own language.
|
•
|
We have a centralized finance organization including an enterprise-wide accounting system and company-wide policies. In addition, the corporate audit function has incorporated anti-corruption procedures in audits of certain countries. We also conduct FCPA risk assessments and legal audit procedures relating to higher risk third parties in non-U.S. jurisdictions.
|
•
|
We continue to work to ensure that we have adequate legal compliance coverage around the world, including the coordination of compliance advice and customized training across all regions and countries where we do business.
|
•
|
We have a centralized human resources function, including, among other things, consistent standards for pre-hire screening of employees, the screening of existing employees prior to promoting them to positions where they may be exposed to corruption-related risks, and a uniform policy for new hire training with a compliance component.
|
(In millions)
|
2016
|
|
2015
|
|
2014
|
||||||
Operating activities
|
$
|
4,229
|
|
|
$
|
1,796
|
|
|
$
|
2,953
|
|
Investing activities
|
203
|
|
|
(905
|
)
|
|
(1,659
|
)
|
|||
Financing activities
|
(2,185
|
)
|
|
(282
|
)
|
|
(939
|
)
|
|
Payments Due by Period
|
||||||||||||||||||
(In millions)
|
Total
|
|
Less Than
1 Year
|
|
2 - 3
Years
|
|
4 - 5
Years
|
|
More Than
5 Years
|
||||||||||
Total debt and capital lease obligations
(1)
|
$
|
3,038
|
|
|
$
|
132
|
|
|
$
|
778
|
|
|
$
|
538
|
|
|
$
|
1,590
|
|
Estimated interest payments
(2)
|
1,953
|
|
|
168
|
|
|
269
|
|
|
216
|
|
|
1,300
|
|
|||||
Operating leases
(3)
|
344
|
|
|
118
|
|
|
106
|
|
|
48
|
|
|
72
|
|
|||||
Purchase obligations
(4)
|
286
|
|
|
102
|
|
|
81
|
|
|
66
|
|
|
37
|
|
|||||
Liabilities for uncertain income tax positions
(5)
|
351
|
|
|
216
|
|
|
68
|
|
|
32
|
|
|
35
|
|
|||||
Other long-term liabilities
|
164
|
|
|
34
|
|
|
42
|
|
|
14
|
|
|
74
|
|
|||||
Total
(6)
|
$
|
6,136
|
|
|
$
|
770
|
|
|
$
|
1,344
|
|
|
$
|
914
|
|
|
$
|
3,108
|
|
(1)
|
Amounts represent the expected cash payments for the principal amounts related to our debt, including capital lease obligations. Amounts for debt do not include any unamortized discounts or deferred issuance costs. Expected cash payments for interest are excluded from these amounts.
|
(2)
|
Amounts represent the expected cash payments for interest on our long-term debt and capital lease obligations.
|
(3)
|
Amounts represent the future minimum payments under noncancelable operating leases with initial or remaining terms of one year or more. We enter into operating leases, some of which include renewal options; however, we have excluded renewal options from the table above unless it is anticipated that we will exercise such renewals.
|
(4)
|
Purchase obligations include capital improvements as well as agreements to purchase goods or services that are enforceable and legally binding and that specify all significant terms, including: fixed or minimum quantities to be purchased; fixed, minimum or variable price provisions; and the approximate timing of the transaction.
|
(5)
|
The estimated income tax liabilities for uncertain tax positions will be settled as a result of expiring statutes, audit activity, competent authority proceedings related to transfer pricing, or final decisions in matters that are the subject of litigation in various taxing jurisdictions in which we operate. The timing of any particular settlement will depend on the length of the tax audit and related appeals process, if any, or an expiration of a statute. If a liability is settled due to a statute expiring or a favorable audit result, the settlement of the tax liability would not result in a cash payment.
|
(6)
|
Amounts do not include expected contributions to our pension and other postretirement defined benefit plans of between $70 million to $80 million in 2017 as the majority of these contributions are amounts in excess of minimum funding requirements and as such would not be considered a contractual obligation.
|
(1)
|
Amounts do not include any unamortized discounts, premiums or deferred issuance costs on our fixed rate long-term debt.
|
(2)
|
Fair market value of our fixed rate long-term debt was $3.23 billion at
December 31, 2016
and $4.17 billion at
December 31, 2015
.
|
(3)
|
Amounts represent the principal value of our long-term debt outstanding and related weighted average interest rates at the end of the respective period.
|
/s/ MARTIN S. CRAIGHEAD
Martin S. Craighead
Chairman and
Chief Executive Officer
|
|
/s/ KIMBERLY A. ROSS
Kimberly A. Ross
Senior Vice President and
Chief Financial Officer
|
|
/s/ KELLY C. JANZEN
Kelly C. Janzen
Vice President, Controller and Chief Accounting Officer
|
|
Year Ended December 31,
|
||||||||||
(In millions, except per share amounts)
|
2016
|
|
2015
|
|
2014
|
||||||
Revenue:
|
|
|
|
|
|
||||||
Sales
|
$
|
3,870
|
|
|
$
|
5,649
|
|
|
$
|
8,056
|
|
Services
|
5,971
|
|
|
10,093
|
|
|
16,495
|
|
|||
Total revenue
|
9,841
|
|
|
15,742
|
|
|
24,551
|
|
|||
Costs and expenses:
|
|
|
|
|
|
||||||
Cost of sales
|
3,722
|
|
|
4,833
|
|
|
6,294
|
|
|||
Cost of services
|
6,251
|
|
|
9,582
|
|
|
13,452
|
|
|||
Research and engineering
|
384
|
|
|
466
|
|
|
613
|
|
|||
Marketing, general and administrative
|
815
|
|
|
969
|
|
|
1,333
|
|
|||
Impairment and restructuring charges
|
1,735
|
|
|
1,993
|
|
|
—
|
|
|||
Goodwill impairment
|
1,858
|
|
|
—
|
|
|
—
|
|
|||
Merger and related costs
|
199
|
|
|
295
|
|
|
—
|
|
|||
Merger termination fee
|
(3,500
|
)
|
|
—
|
|
|
—
|
|
|||
Total costs and expenses
|
11,464
|
|
|
18,138
|
|
|
21,692
|
|
|||
Operating (loss) income
|
(1,623
|
)
|
|
(2,396
|
)
|
|
2,859
|
|
|||
Loss on sale of business interest
|
(97
|
)
|
|
—
|
|
|
—
|
|
|||
Loss on early extinguishment of debt
|
(142
|
)
|
|
—
|
|
|
—
|
|
|||
Interest expense, net
|
(178
|
)
|
|
(217
|
)
|
|
(232
|
)
|
|||
(Loss) income before income taxes
|
(2,040
|
)
|
|
(2,613
|
)
|
|
2,627
|
|
|||
Income tax (provision) benefit
|
(696
|
)
|
|
639
|
|
|
(896
|
)
|
|||
Net (loss) income
|
(2,736
|
)
|
|
(1,974
|
)
|
|
1,731
|
|
|||
Net (income) loss attributable to noncontrolling interests
|
(2
|
)
|
|
7
|
|
|
(12
|
)
|
|||
Net (loss) income attributable to Baker Hughes
|
$
|
(2,738
|
)
|
|
$
|
(1,967
|
)
|
|
$
|
1,719
|
|
|
|
|
|
|
|
||||||
Basic (loss) earnings per share attributable to Baker Hughes
|
$
|
(6.31
|
)
|
|
$
|
(4.49
|
)
|
|
$
|
3.93
|
|
|
|
|
|
|
|
||||||
Diluted (loss) earnings per share attributable to Baker Hughes
|
$
|
(6.31
|
)
|
|
$
|
(4.49
|
)
|
|
$
|
3.92
|
|
|
Year Ended December 31,
|
||||||||||
(In millions)
|
2016
|
|
2015
|
|
2014
|
||||||
Net (loss) income
|
$
|
(2,736
|
)
|
|
$
|
(1,974
|
)
|
|
$
|
1,731
|
|
Other comprehensive (loss) income:
|
|
|
|
|
|
||||||
Foreign currency translation adjustments
|
(5
|
)
|
|
(241
|
)
|
|
(216
|
)
|
|||
Pension and other postretirement benefits, net of tax
|
(23
|
)
|
|
(15
|
)
|
|
(29
|
)
|
|||
Other comprehensive loss
|
(28
|
)
|
|
(256
|
)
|
|
(245
|
)
|
|||
Comprehensive (loss) income
|
(2,764
|
)
|
|
(2,230
|
)
|
|
1,486
|
|
|||
Comprehensive (income) loss attributable to noncontrolling interests
|
(2
|
)
|
|
7
|
|
|
(12
|
)
|
|||
Comprehensive (loss) income attributable to Baker Hughes
|
$
|
(2,766
|
)
|
|
$
|
(2,223
|
)
|
|
$
|
1,474
|
|
|
|||||||
|
December 31,
|
||||||
(In millions, except par value)
|
2016
|
|
2015
|
||||
ASSETS
|
|||||||
Current Assets:
|
|
|
|
||||
Cash and cash equivalents
|
$
|
4,572
|
|
|
$
|
2,324
|
|
Accounts receivable - less allowance for doubtful accounts
(2016 - $509; 2015 - $383)
|
2,251
|
|
|
3,217
|
|
||
Inventories, net
|
1,809
|
|
|
2,917
|
|
||
Other current assets
|
535
|
|
|
810
|
|
||
Total current assets
|
9,167
|
|
|
9,268
|
|
||
|
|
|
|
||||
Property, plant and equipment - less accumulated depreciation
(2016 - $6,567; 2015 - $7,378)
|
4,271
|
|
|
6,693
|
|
||
Goodwill
|
4,084
|
|
|
6,070
|
|
||
Intangible assets, net
|
318
|
|
|
583
|
|
||
Other assets
|
1,194
|
|
|
1,466
|
|
||
Total assets
|
$
|
19,034
|
|
|
$
|
24,080
|
|
LIABILITIES AND EQUITY
|
|||||||
Current Liabilities:
|
|
|
|
||||
Accounts payable
|
$
|
1,027
|
|
|
$
|
1,409
|
|
Short-term debt and current portion of long-term debt
|
132
|
|
|
151
|
|
||
Accrued employee compensation
|
566
|
|
|
690
|
|
||
Income taxes payable
|
78
|
|
|
55
|
|
||
Other accrued liabilities
|
501
|
|
|
470
|
|
||
Total current liabilities
|
2,304
|
|
|
2,775
|
|
||
|
|
|
|
||||
Long-term debt
|
2,886
|
|
|
3,890
|
|
||
Deferred income taxes and other tax liabilities
|
328
|
|
|
252
|
|
||
Liabilities for pensions and other postretirement benefits
|
626
|
|
|
646
|
|
||
Other liabilities
|
153
|
|
|
135
|
|
||
Commitments and contingencies
|
|
|
|
||||
|
|
|
|
||||
Equity:
|
|
|
|
||||
Common stock, one dollar par value
(shares authorized - 750; issued and outstanding: 2016 - 424; 2015 - 437)
|
425
|
|
|
437
|
|
||
Capital in excess of par value
|
6,708
|
|
|
7,261
|
|
||
Retained earnings
|
6,583
|
|
|
9,614
|
|
||
Accumulated other comprehensive loss
|
(1,033
|
)
|
|
(1,005
|
)
|
||
Treasury stock
|
(27
|
)
|
|
(9
|
)
|
||
Baker Hughes stockholders' equity
|
12,656
|
|
|
16,298
|
|
||
Noncontrolling interests
|
81
|
|
|
84
|
|
||
Total equity
|
12,737
|
|
|
16,382
|
|
||
Total liabilities and equity
|
$
|
19,034
|
|
|
$
|
24,080
|
|
|
Baker Hughes Stockholders' Equity
|
|
|
|
|
||||||||||||||||||||||
(In millions, except per share amounts)
|
Common Stock
|
|
Capital in Excess of Par Value
|
|
Retained Earnings
|
|
Accumulated Other Comprehensive Loss
|
|
Treasury Stock
|
|
Non-controlling Interests
|
|
Total
|
||||||||||||||
Balance at December 31, 2013
|
$
|
438
|
|
|
$
|
7,341
|
|
|
$
|
10,438
|
|
|
$
|
(504
|
)
|
|
$
|
—
|
|
|
$
|
199
|
|
|
$
|
17,912
|
|
Comprehensive income:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Net income
|
|
|
|
|
1,719
|
|
|
|
|
|
|
12
|
|
|
1,731
|
|
|||||||||||
Other comprehensive loss
|
|
|
|
|
|
|
(245
|
)
|
|
|
|
|
|
(245
|
)
|
||||||||||||
Activity related to stock plans
|
5
|
|
|
200
|
|
|
|
|
|
|
|
|
|
|
205
|
|
|||||||||||
Repurchase and retirement of common stock
|
(9
|
)
|
|
(591
|
)
|
|
|
|
|
|
|
|
|
|
(600
|
)
|
|||||||||||
Stock-based compensation cost
|
|
|
122
|
|
|
|
|
|
|
|
|
|
|
122
|
|
||||||||||||
Cash dividends ($0.64 per share)
|
|
|
|
|
(279
|
)
|
|
|
|
|
|
|
|
(279
|
)
|
||||||||||||
Net activity related to noncontrolling interests
|
|
|
(10
|
)
|
|
|
|
|
|
|
|
(106
|
)
|
|
(116
|
)
|
|||||||||||
Balance at December 31, 2014
|
$
|
434
|
|
|
$
|
7,062
|
|
|
$
|
11,878
|
|
|
$
|
(749
|
)
|
|
$
|
—
|
|
|
$
|
105
|
|
|
$
|
18,730
|
|
Comprehensive income:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Net loss
|
|
|
|
|
(1,967
|
)
|
|
|
|
|
|
(7
|
)
|
|
(1,974
|
)
|
|||||||||||
Other comprehensive loss
|
|
|
|
|
|
|
(256
|
)
|
|
|
|
|
|
(256
|
)
|
||||||||||||
Activity related to stock plans
|
3
|
|
|
101
|
|
|
|
|
|
|
(9
|
)
|
|
|
|
95
|
|
||||||||||
Stock-based compensation cost
|
|
|
120
|
|
|
|
|
|
|
|
|
|
|
120
|
|
||||||||||||
Cash dividends ($0.68 per share)
|
|
|
|
|
(297
|
)
|
|
|
|
|
|
|
|
(297
|
)
|
||||||||||||
Net activity related to noncontrolling interests
|
|
|
(22
|
)
|
|
|
|
|
|
|
|
(14
|
)
|
|
(36
|
)
|
|||||||||||
Balance at December 31, 2015
|
$
|
437
|
|
|
$
|
7,261
|
|
|
$
|
9,614
|
|
|
$
|
(1,005
|
)
|
|
$
|
(9
|
)
|
|
$
|
84
|
|
|
$
|
16,382
|
|
Comprehensive income:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Net loss
|
|
|
|
|
(2,738
|
)
|
|
|
|
|
|
2
|
|
|
(2,736
|
)
|
|||||||||||
Other comprehensive loss
|
|
|
|
|
|
|
(28
|
)
|
|
|
|
|
|
(28
|
)
|
||||||||||||
Activity related to stock plans
|
4
|
|
|
69
|
|
|
|
|
|
|
(18
|
)
|
|
|
|
55
|
|
||||||||||
Repurchase and retirement of common stock
|
(16
|
)
|
|
(747
|
)
|
|
|
|
|
|
|
|
|
|
(763
|
)
|
|||||||||||
Stock-based compensation cost
|
|
|
125
|
|
|
|
|
|
|
|
|
|
|
125
|
|
||||||||||||
Cash dividends ($0.68 per share)
|
|
|
|
|
(293
|
)
|
|
|
|
|
|
|
|
(293
|
)
|
||||||||||||
Net activity related to noncontrolling interests
|
|
|
|
|
|
|
|
|
|
|
(5
|
)
|
|
(5
|
)
|
||||||||||||
Balance at December 31, 2016
|
$
|
425
|
|
|
$
|
6,708
|
|
|
$
|
6,583
|
|
|
$
|
(1,033
|
)
|
|
$
|
(27
|
)
|
|
$
|
81
|
|
|
$
|
12,737
|
|
|
Year Ended December 31,
|
||||||||||
(In millions)
|
2016
|
|
2015
|
|
2014
|
||||||
Cash flows from operating activities:
|
|
|
|
|
|
||||||
Net (loss) income
|
$
|
(2,736
|
)
|
|
$
|
(1,974
|
)
|
|
$
|
1,731
|
|
Adjustments to reconcile net (loss) income to net cash flows from operating activities:
|
|
|
|
|
|
||||||
Depreciation and amortization
|
1,166
|
|
|
1,742
|
|
|
1,814
|
|
|||
Impairment of assets
|
1,271
|
|
|
1,436
|
|
|
—
|
|
|||
Goodwill impairment
|
1,858
|
|
|
—
|
|
|
—
|
|
|||
Inventory write-down
|
583
|
|
|
194
|
|
|
—
|
|
|||
Loss on early extinguishment of debt
|
142
|
|
|
—
|
|
|
—
|
|
|||
Provision (benefit) for deferred income taxes
|
349
|
|
|
(809
|
)
|
|
(70
|
)
|
|||
Gain on disposal of assets
|
(109
|
)
|
|
(157
|
)
|
|
(297
|
)
|
|||
Provision for doubtful accounts
|
188
|
|
|
193
|
|
|
102
|
|
|||
Provision for excess and obsolete inventory
|
181
|
|
|
195
|
|
|
37
|
|
|||
Other noncash items
|
222
|
|
|
120
|
|
|
122
|
|
|||
Changes in operating assets and liabilities:
|
|
|
|
|
|
||||||
Accounts receivable
|
762
|
|
|
1,943
|
|
|
(524
|
)
|
|||
Inventories
|
293
|
|
|
703
|
|
|
(296
|
)
|
|||
Other current assets
|
441
|
|
|
61
|
|
|
23
|
|
|||
Accounts payable
|
(360
|
)
|
|
(1,349
|
)
|
|
291
|
|
|||
Income taxes payable
|
18
|
|
|
(305
|
)
|
|
90
|
|
|||
Other assets and liabilities, net
|
(40
|
)
|
|
(197
|
)
|
|
(70
|
)
|
|||
Net cash flows provided by operating activities
|
4,229
|
|
|
1,796
|
|
|
2,953
|
|
|||
Cash flows from investing activities:
|
|
|
|
|
|
||||||
Expenditures for capital assets
|
(332
|
)
|
|
(965
|
)
|
|
(1,791
|
)
|
|||
Proceeds from disposal of assets
|
283
|
|
|
388
|
|
|
437
|
|
|||
Proceeds from maturities of investment securities
|
453
|
|
|
—
|
|
|
—
|
|
|||
Purchase of investment securities
|
(349
|
)
|
|
(310
|
)
|
|
—
|
|
|||
Net proceeds from sale of business interest
|
142
|
|
|
—
|
|
|
—
|
|
|||
Acquisition of businesses, net of cash acquired
|
(14
|
)
|
|
—
|
|
|
(314
|
)
|
|||
Other investing items, net
|
20
|
|
|
(18
|
)
|
|
9
|
|
|||
Net cash flows provided by (used in) investing activities
|
203
|
|
|
(905
|
)
|
|
(1,659
|
)
|
|||
Cash flows from financing activities:
|
|
|
|
|
|
||||||
Net repayments of commercial paper borrowings and other debt with three months or less original maturity
|
(29
|
)
|
|
(53
|
)
|
|
(216
|
)
|
|||
Repayment of short-term debt with greater than three months original maturity
|
(100
|
)
|
|
(293
|
)
|
|
(217
|
)
|
|||
Proceeds of short-term debt with greater than three months original maturity
|
69
|
|
|
301
|
|
|
185
|
|
|||
Repayment of long-term debt
|
(1,135
|
)
|
|
—
|
|
|
—
|
|
|||
Repurchase of common stock
|
(763
|
)
|
|
—
|
|
|
(600
|
)
|
|||
Proceeds from issuance of common stock
|
91
|
|
|
116
|
|
|
216
|
|
|||
Dividends paid
|
(293
|
)
|
|
(297
|
)
|
|
(279
|
)
|
|||
Other financing items, net
|
(25
|
)
|
|
(56
|
)
|
|
(28
|
)
|
|||
Net cash flows used in financing activities
|
(2,185
|
)
|
|
(282
|
)
|
|
(939
|
)
|
|||
Effect of foreign exchange rate changes on cash and cash equivalents
|
1
|
|
|
(25
|
)
|
|
(14
|
)
|
|||
Increase in cash and cash equivalents
|
2,248
|
|
|
584
|
|
|
341
|
|
|||
Cash and cash equivalents, beginning of period
|
2,324
|
|
|
1,740
|
|
|
1,399
|
|
|||
Cash and cash equivalents, end of period
|
$
|
4,572
|
|
|
$
|
2,324
|
|
|
$
|
1,740
|
|
Supplemental cash flows disclosures:
|
|
|
|
|
|
||||||
Income taxes paid, net of refunds
|
$
|
(74
|
)
|
|
$
|
483
|
|
|
$
|
881
|
|
Interest paid
|
$
|
217
|
|
|
$
|
242
|
|
|
$
|
250
|
|
Supplemental disclosure of noncash investing activities:
|
|
|
|
|
|
||||||
Capital expenditures included in accounts payable
|
$
|
33
|
|
|
$
|
44
|
|
|
$
|
171
|
|
•
|
Level One: The use of quoted prices in active markets for identical financial instruments.
|
•
|
Level Two: The use of quoted prices for similar instruments in active markets or quoted prices for identical or similar instruments in markets that are not active or other inputs that are observable in the market or can be corroborated by observable market data.
|
•
|
Level Three: The use of significantly unobservable inputs that typically require the use of management's estimates of assumptions that market participants would use in pricing.
|
|
Impairment Charges
|
|
Net Carrying Value
|
|
|||||||||||||
Segments
|
Machinery, Equipment and Other
|
Intangible Assets
|
Total Impairment Charges
|
Machinery, Equipment and Other
|
Intangible Assets
|
WACC
|
|||||||||||
North America
|
$
|
84
|
|
$
|
85
|
|
$
|
169
|
|
$
|
241
|
|
$
|
125
|
|
10.0
|
%
|
Latin America
|
66
|
|
5
|
|
71
|
|
245
|
|
17
|
|
16.0
|
%
|
|||||
Europe/Africa/Russia Caspian
|
124
|
|
4
|
|
128
|
|
222
|
|
8
|
|
(1
|
)
|
|||||
Middle East/Asia Pacific
|
166
|
|
17
|
|
183
|
|
433
|
|
49
|
|
(1
|
)
|
|||||
Industrial Services
|
13
|
|
3
|
|
16
|
|
196
|
|
44
|
|
10.0
|
%
|
|||||
Total
|
$
|
453
|
|
$
|
114
|
|
$
|
567
|
|
$
|
1,337
|
|
$
|
243
|
|
|
(1)
|
The WACC's used by region in 2016 were as follows: Europe -
10.5%
; Africa -
19.5%
; Russia/Caspian -
15.0%
; Middle East -
14.0%
; Asia Pacific -
13.5%
.
|
Restructuring Charges
|
2016
|
|
2015
|
||||
Workforce reductions
|
$
|
272
|
|
|
$
|
436
|
|
Contract terminations
|
192
|
|
|
121
|
|
||
Impairment of buildings and improvements
|
214
|
|
|
82
|
|
||
Impairment of machinery and equipment
|
490
|
|
|
191
|
|
||
Total restructuring charges
|
$
|
1,168
|
|
|
$
|
830
|
|
|
2016
|
|
2015
|
|
2014
|
||||||||||||||||||
Segments
|
Revenue
|
|
Operating Profit (Loss) Before Tax
|
|
Revenue
|
|
Operating Profit (Loss) Before Tax
|
|
Revenue
|
|
Operating Profit (Loss) Before Tax
|
||||||||||||
North America
|
$
|
2,936
|
|
|
$
|
(687
|
)
|
|
$
|
6,009
|
|
|
$
|
(639
|
)
|
|
$
|
12,078
|
|
|
$
|
1,466
|
|
Latin America
|
980
|
|
|
(276
|
)
|
|
1,799
|
|
|
144
|
|
|
2,236
|
|
|
290
|
|
||||||
Europe/Africa/Russia Caspian
|
2,201
|
|
|
(273
|
)
|
|
3,278
|
|
|
183
|
|
|
4,417
|
|
|
621
|
|
||||||
Middle East/Asia Pacific
|
2,705
|
|
|
69
|
|
|
3,441
|
|
|
229
|
|
|
4,456
|
|
|
675
|
|
||||||
Industrial Services
|
1,019
|
|
|
(6
|
)
|
|
1,215
|
|
|
108
|
|
|
1,364
|
|
|
119
|
|
||||||
Total Operations
|
9,841
|
|
|
(1,173
|
)
|
|
15,742
|
|
|
25
|
|
|
24,551
|
|
|
3,171
|
|
||||||
Corporate
|
—
|
|
|
(158
|
)
|
|
—
|
|
|
(133
|
)
|
|
—
|
|
|
(312
|
)
|
||||||
Loss on sale of business interest
|
—
|
|
|
(97
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||
Loss on early extinguishment of debt
|
—
|
|
|
(142
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||
Interest expense, net
|
—
|
|
|
(178
|
)
|
|
—
|
|
|
(217
|
)
|
|
—
|
|
|
(232
|
)
|
||||||
Impairment and restructuring charges
|
—
|
|
|
(1,735
|
)
|
|
—
|
|
|
(1,993
|
)
|
|
—
|
|
|
—
|
|
||||||
Goodwill impairment
|
—
|
|
|
(1,858
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||
Merger and related costs
|
—
|
|
|
(199
|
)
|
|
—
|
|
|
(295
|
)
|
|
—
|
|
|
—
|
|
||||||
Merger termination fee
|
—
|
|
|
3,500
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||
Total
|
$
|
9,841
|
|
|
$
|
(2,040
|
)
|
|
$
|
15,742
|
|
|
$
|
(2,613
|
)
|
|
$
|
24,551
|
|
|
$
|
2,627
|
|
|
2016
|
|
2015
|
|
2014
|
||||||
Segments
|
Assets
|
|
Assets
|
|
Assets
|
||||||
North America
|
$
|
3,049
|
|
|
$
|
6,599
|
|
|
$
|
9,782
|
|
Latin America
|
1,530
|
|
|
2,323
|
|
|
2,508
|
|
|||
Europe/Africa/Russia Caspian
|
2,446
|
|
|
3,077
|
|
|
4,106
|
|
|||
Middle East/Asia Pacific
|
2,746
|
|
|
3,441
|
|
|
4,029
|
|
|||
Industrial Services
|
631
|
|
|
1,106
|
|
|
1,260
|
|
|||
Shared assets
|
5,129
|
|
|
5,613
|
|
|
5,423
|
|
|||
Total Operations
|
15,531
|
|
|
22,159
|
|
|
27,108
|
|
|||
Corporate
|
3,503
|
|
|
1,921
|
|
|
1,719
|
|
|||
Total
|
$
|
19,034
|
|
|
$
|
24,080
|
|
|
$
|
28,827
|
|
|
2016
|
|
2015
|
|
2014
|
||||||||||||||||||
Segments
|
Capital
Expenditures
|
|
Depreciation
and
Amortization
|
|
Capital
Expenditures
|
|
Depreciation
and
Amortization
|
|
Capital
Expenditures
|
|
Depreciation
and
Amortization
|
||||||||||||
North America
|
$
|
75
|
|
|
$
|
356
|
|
|
$
|
228
|
|
|
$
|
714
|
|
|
$
|
465
|
|
|
$
|
842
|
|
Latin America
|
35
|
|
|
160
|
|
|
103
|
|
|
213
|
|
|
171
|
|
|
220
|
|
||||||
Europe/Africa/Russia Caspian
|
122
|
|
|
268
|
|
|
175
|
|
|
378
|
|
|
373
|
|
|
351
|
|
||||||
Middle East/Asia Pacific
|
83
|
|
|
300
|
|
|
247
|
|
|
344
|
|
|
385
|
|
|
321
|
|
||||||
Industrial Services
|
7
|
|
|
77
|
|
|
21
|
|
|
87
|
|
|
46
|
|
|
70
|
|
||||||
Shared assets
|
9
|
|
|
—
|
|
|
188
|
|
|
—
|
|
|
342
|
|
|
—
|
|
||||||
Total Operations
|
331
|
|
|
1,161
|
|
|
962
|
|
|
1,736
|
|
|
1,782
|
|
|
1,804
|
|
||||||
Corporate
|
1
|
|
|
5
|
|
|
3
|
|
|
6
|
|
|
9
|
|
|
10
|
|
||||||
Total
|
$
|
332
|
|
|
$
|
1,166
|
|
|
$
|
965
|
|
|
$
|
1,742
|
|
|
$
|
1,791
|
|
|
$
|
1,814
|
|
|
2016
|
|
2015
|
|
2014
|
||||||
|
Revenue
|
|
Revenue
|
|
Revenue
|
||||||
U.S.
|
$
|
2,875
|
|
|
$
|
5,800
|
|
|
$
|
11,499
|
|
Canada and other
|
598
|
|
|
839
|
|
|
1,336
|
|
|||
North America
|
3,473
|
|
|
6,639
|
|
|
12,835
|
|
|||
Latin America
|
1,006
|
|
|
1,847
|
|
|
2,300
|
|
|||
Europe/Africa/Russia Caspian
|
2,457
|
|
|
3,555
|
|
|
4,705
|
|
|||
Middle East/Asia Pacific
|
2,905
|
|
|
3,701
|
|
|
4,711
|
|
|||
Total
|
$
|
9,841
|
|
|
$
|
15,742
|
|
|
$
|
24,551
|
|
|
2016
|
|
2015
|
|
2014
|
||||||
|
Net Property, Plant and Equipment
|
|
Net Property, Plant and Equipment
|
|
Net Property, Plant and Equipment
|
||||||
U.S.
|
$
|
1,792
|
|
|
$
|
2,989
|
|
|
$
|
4,417
|
|
Canada and other
|
148
|
|
|
260
|
|
|
482
|
|
|||
North America
|
1,940
|
|
|
3,249
|
|
|
4,899
|
|
|||
Latin America
|
466
|
|
|
716
|
|
|
890
|
|
|||
Europe/Africa/Russia Caspian
|
984
|
|
|
1,400
|
|
|
1,805
|
|
|||
Middle East/Asia Pacific
|
881
|
|
|
1,328
|
|
|
1,469
|
|
|||
Total
|
$
|
4,271
|
|
|
$
|
6,693
|
|
|
$
|
9,063
|
|
|
2016
|
|
2015
|
|
2014
|
||||||
Completion and Production
|
$
|
5,681
|
|
|
$
|
8,831
|
|
|
$
|
14,572
|
|
Drilling and Evaluation
|
3,141
|
|
|
5,696
|
|
|
8,615
|
|
|||
Industrial Services
|
1,019
|
|
|
1,215
|
|
|
1,364
|
|
|||
Total
|
$
|
9,841
|
|
|
$
|
15,742
|
|
|
$
|
24,551
|
|
|
2016
|
|
2015
|
|
2014
|
||||||
Stock-based compensation cost
|
$
|
125
|
|
|
$
|
120
|
|
|
$
|
122
|
|
Tax benefit
|
(33
|
)
|
|
(28
|
)
|
|
(26
|
)
|
|||
Stock-based compensation cost, net of tax
|
$
|
92
|
|
|
$
|
92
|
|
|
$
|
96
|
|
|
|
2014
|
||
Expected life (years)
|
|
4.6
|
|
|
Risk-free interest rate
|
|
1.5
|
%
|
|
Volatility
|
|
31.9
|
%
|
|
Dividend yield
|
|
1.0
|
%
|
|
Weighted average fair value per share at grant date
|
|
$
|
16.81
|
|
|
Number of
Options
|
|
Weighted Average
Exercise Price
Per Option
|
|||||||
Outstanding at December 31, 2015
|
|
8,602
|
|
|
|
|
$
|
54.56
|
|
|
Granted
|
|
—
|
|
|
|
|
—
|
|
|
|
Exercised
|
|
(765
|
)
|
|
|
|
44.04
|
|
|
|
Forfeited
|
|
(78
|
)
|
|
|
|
60.35
|
|
|
|
Expired
|
|
(522
|
)
|
|
|
|
75.55
|
|
|
|
Outstanding at December 31, 2016
|
|
7,237
|
|
|
|
|
$
|
54.09
|
|
|
Exercisable at December 31, 2016
|
|
6,993
|
|
|
|
|
$
|
53.76
|
|
|
|
Number of
Awards and Units
|
|
Weighted Average
Grant Date Fair
Value Per Award/Unit
|
|||
Unvested balance at December 31, 2015
|
3,356
|
|
|
$
|
58.99
|
|
Granted
|
3,313
|
|
|
40.56
|
|
|
Vested
|
(1,809
|
)
|
|
55.50
|
|
|
Forfeited
|
(809
|
)
|
|
49.73
|
|
|
Unvested balance at December 31, 2016
|
4,051
|
|
|
$
|
47.33
|
|
|
2016
|
|
2015
|
|
2014
|
||||||
Expected life (years)
|
0.5
|
|
|
0.5
|
|
|
0.5
|
|
|||
Risk-free interest rate
|
0.5
|
%
|
|
0.1
|
%
|
|
0.03
|
%
|
|||
Volatility
|
46.2
|
%
|
|
30.9
|
%
|
|
24.7
|
%
|
|||
Dividend yield
|
1.5
|
%
|
|
1.2
|
%
|
|
1.0
|
%
|
|||
Fair value per share of the 15% cash discount
|
$
|
6.85
|
|
|
$
|
8.79
|
|
|
$
|
9.72
|
|
Fair value per share of the look-back provision
|
5.86
|
|
|
4.97
|
|
|
4.39
|
|
|||
Total weighted average fair value per share at grant date
|
$
|
12.71
|
|
|
$
|
13.76
|
|
|
$
|
14.11
|
|
|
2016
|
|
2015
|
|
2014
|
||||||
Current:
|
|
|
|
|
|
||||||
U.S.
|
$
|
139
|
|
|
$
|
(55
|
)
|
|
$
|
365
|
|
Foreign
|
208
|
|
|
225
|
|
|
601
|
|
|||
Total current
|
347
|
|
|
170
|
|
|
966
|
|
|||
Deferred:
|
|
|
|
|
|
||||||
U.S.
|
269
|
|
|
(762
|
)
|
|
(52
|
)
|
|||
Foreign
|
80
|
|
|
(47
|
)
|
|
(18
|
)
|
|||
Total deferred
|
349
|
|
|
(809
|
)
|
|
(70
|
)
|
|||
Provision (benefit) for income taxes
|
$
|
696
|
|
|
$
|
(639
|
)
|
|
$
|
896
|
|
|
2016
|
|
2015
|
|
2014
|
||||||
U.S.
|
$
|
(347
|
)
|
|
$
|
(2,288
|
)
|
|
$
|
920
|
|
Foreign
|
(1,693
|
)
|
|
(325
|
)
|
|
1,707
|
|
|||
(Loss) income before income taxes
|
$
|
(2,040
|
)
|
|
$
|
(2,613
|
)
|
|
$
|
2,627
|
|
|
2016
|
|
2015
|
||||
Deferred tax assets:
|
|
|
|
||||
Receivables
|
$
|
184
|
|
|
$
|
84
|
|
Inventory
|
196
|
|
|
253
|
|
||
Property
|
261
|
|
|
—
|
|
||
Employee benefits
|
128
|
|
|
143
|
|
||
Other accrued expenses
|
125
|
|
|
141
|
|
||
Operating loss carryforwards
|
1,111
|
|
|
1,153
|
|
||
Tax credit carryforwards
|
214
|
|
|
458
|
|
||
Other
|
52
|
|
|
112
|
|
||
Subtotal
|
2,271
|
|
|
2,344
|
|
||
Valuation allowances
|
(2,010
|
)
|
|
(1,210
|
)
|
||
Total
|
261
|
|
|
1,134
|
|
||
Deferred tax liabilities:
|
|
|
|
||||
Goodwill and other intangibles
|
133
|
|
|
272
|
|
||
Property
|
—
|
|
|
47
|
|
||
Undistributed earnings of foreign subsidiaries
|
27
|
|
|
21
|
|
||
Other
|
6
|
|
|
35
|
|
||
Total
|
166
|
|
|
375
|
|
||
Net deferred tax asset
|
$
|
95
|
|
|
$
|
759
|
|
|
Gross Unrecognized Tax
Benefits, Excluding
Interest and Penalties
|
|
Interest and
Penalties
|
|
Total Gross
Unrecognized Tax
Benefits
|
||||||||||
Balance at December 31, 2013
|
|
$
|
228
|
|
|
|
$
|
54
|
|
|
|
$
|
282
|
|
|
(Decrease) increase in prior year tax positions
|
|
(7
|
)
|
|
|
1
|
|
|
|
(6
|
)
|
|
|||
Increase in current year tax positions
|
|
39
|
|
|
|
2
|
|
|
|
41
|
|
|
|||
Decrease related to settlements with taxing authorities
|
|
(5
|
)
|
|
|
(1
|
)
|
|
|
(6
|
)
|
|
|||
Decrease related to lapse of statute of limitations
|
|
(6
|
)
|
|
|
(3
|
)
|
|
|
(9
|
)
|
|
|||
Decrease due to effects of foreign currency translation
|
|
(7
|
)
|
|
|
(4
|
)
|
|
|
(11
|
)
|
|
|||
Balance at December 31, 2014
|
|
242
|
|
|
|
49
|
|
|
|
291
|
|
|
|||
Increase in prior year tax positions
|
|
19
|
|
|
|
15
|
|
|
|
34
|
|
|
|||
Increase in current year tax positions
|
|
26
|
|
|
|
1
|
|
|
|
27
|
|
|
|||
Decrease related to settlements with taxing authorities
|
|
(8
|
)
|
|
|
(2
|
)
|
|
|
(10
|
)
|
|
|||
Decrease related to lapse of statute of limitations
|
|
(11
|
)
|
|
|
(7
|
)
|
|
|
(18
|
)
|
|
|||
Decrease due to effects of foreign currency translation
|
|
(8
|
)
|
|
|
(4
|
)
|
|
|
(12
|
)
|
|
|||
Balance at December 31, 2015
|
|
260
|
|
|
|
52
|
|
|
|
312
|
|
|
|||
Increase in prior year tax positions
|
|
28
|
|
|
|
34
|
|
|
|
62
|
|
|
|||
Increase in current year tax positions
|
|
17
|
|
|
|
1
|
|
|
|
18
|
|
|
|||
Decrease related to settlements with taxing authorities
|
|
(9
|
)
|
|
|
(1
|
)
|
|
|
(10
|
)
|
|
|||
Decrease related to lapse of statute of limitations
|
|
(8
|
)
|
|
|
(8
|
)
|
|
|
(16
|
)
|
|
|||
Decrease due to effects of foreign currency translation
|
|
(11
|
)
|
|
|
(4
|
)
|
|
|
(15
|
)
|
|
|||
Balance at December 31, 2016
|
|
$
|
277
|
|
|
|
$
|
74
|
|
|
|
$
|
351
|
|
|
Jurisdiction
|
|
Earliest Open Tax Period
|
|
Jurisdiction
|
|
Earliest Open Tax Period
|
Argentina
|
|
2009
|
|
Norway
|
|
2006
|
Ecuador
|
|
2005
|
|
Saudi Arabia
|
|
2004
|
Netherlands
|
|
2010
|
|
U.S.
|
|
2010
|
|
2016
|
|
2015
|
|
2014
|
|||
Weighted average common shares outstanding for basic EPS
|
434
|
|
|
438
|
|
|
437
|
|
Effect of dilutive securities - stock plans
|
—
|
|
|
—
|
|
|
2
|
|
Adjusted weighted average common shares outstanding for diluted EPS
|
434
|
|
|
438
|
|
|
439
|
|
|
|
|
|
|
|
|||
Anti-dilutive shares excluded from diluted EPS
(1)
|
1
|
|
|
2
|
|
|
—
|
|
Future potentially dilutive shares excluded from diluted EPS
(2)
|
3
|
|
|
3
|
|
|
2
|
|
(1)
|
The calculation of diluted net loss per share for 2016 and 2015, excludes shares potentially issuable under stock-based incentive compensation plans and the employee stock purchase plan, as their effect, if included, would have been anti-dilutive.
|
(2)
|
Options where the exercise price exceeds the average market price are excluded from the calculation of diluted net loss or earnings per share because their effect would be anti-dilutive.
|
|
2016
|
|
2015
|
||||
Finished goods
|
$
|
1,607
|
|
|
$
|
2,649
|
|
Work in process
|
105
|
|
|
132
|
|
||
Raw materials
|
97
|
|
|
136
|
|
||
Total inventories
|
$
|
1,809
|
|
|
$
|
2,917
|
|
|
Useful Life
|
|
2016
|
|
2015
|
||||
Land
|
|
|
$
|
211
|
|
|
$
|
263
|
|
Buildings and improvements
|
5 - 30 years
|
|
2,146
|
|
|
2,624
|
|
||
Machinery, equipment and other
|
1 - 20 years
|
|
8,481
|
|
|
11,184
|
|
||
Subtotal
|
|
|
10,838
|
|
|
14,071
|
|
||
Less: Accumulated depreciation
|
|
|
6,567
|
|
|
7,378
|
|
||
Total property, plant and equipment
|
|
|
$
|
4,271
|
|
|
$
|
6,693
|
|
|
North
America
|
|
Latin
America
|
|
Europe/
Africa/
Russia
Caspian
|
|
Middle
East/
Asia
Pacific
|
|
Industrial
Services
|
|
Total Goodwill
|
||||||||||||
Balance at December 31, 2015
|
$
|
3,097
|
|
|
$
|
584
|
|
|
$
|
1,068
|
|
|
$
|
819
|
|
|
$
|
502
|
|
|
$
|
6,070
|
|
Impairments
|
(1,549
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(309
|
)
|
|
(1,858
|
)
|
||||||
Disposition
|
(139
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(139
|
)
|
||||||
Currency translation adjustments and other
|
6
|
|
|
4
|
|
|
—
|
|
|
1
|
|
|
—
|
|
|
11
|
|
||||||
Balance at December 31, 2016
|
$
|
1,415
|
|
|
$
|
588
|
|
|
$
|
1,068
|
|
|
$
|
820
|
|
|
$
|
193
|
|
|
$
|
4,084
|
|
|
2016
|
|
2015
|
||||||||||||||||||||
|
Gross
Carrying
Amount
|
|
Less:
Accumulated
Amortization
|
|
Net
|
|
Gross
Carrying
Amount
|
|
Less:
Accumulated
Amortization
|
|
Net
|
||||||||||||
Technology
(1)
|
$
|
527
|
|
|
$
|
267
|
|
|
$
|
260
|
|
|
$
|
866
|
|
|
$
|
452
|
|
|
$
|
414
|
|
Customer relationships
(1)
|
74
|
|
|
31
|
|
|
43
|
|
|
251
|
|
|
106
|
|
|
145
|
|
||||||
Trade names
(1)
|
90
|
|
|
79
|
|
|
11
|
|
|
108
|
|
|
89
|
|
|
19
|
|
||||||
Other
|
17
|
|
|
13
|
|
|
4
|
|
|
18
|
|
|
13
|
|
|
5
|
|
||||||
Total intangibles
|
$
|
708
|
|
|
$
|
390
|
|
|
$
|
318
|
|
|
$
|
1,243
|
|
|
$
|
660
|
|
|
$
|
583
|
|
(1)
|
During 2016 and 2015, we recorded impairments relating to our technology, customer relationships and trade names intangible assets totaling
$114 million
and
$116 million
, respectively. See Note 4. "Impairment and Restructuring Charges" for further discussion.
|
Year
|
Estimated Amortization Expense
|
||
2017
|
$
|
54
|
|
2018
|
49
|
|
|
2019
|
46
|
|
|
2020
|
38
|
|
|
2021
|
33
|
|
|
2016
|
|
2015
|
||||
6.0% Notes due June 2018
|
$
|
199
|
|
|
$
|
255
|
|
7.5% Senior Notes due November 2018
|
524
|
|
|
747
|
|
||
3.2% Senior Notes due August 2021
|
511
|
|
|
746
|
|
||
8.55% Debentures due June 2024
|
112
|
|
|
149
|
|
||
6.875% Notes due January 2029
|
301
|
|
|
394
|
|
||
5.125% Notes due September 2040
|
1,132
|
|
|
1,482
|
|
||
Other debt
|
239
|
|
|
268
|
|
||
Total debt
|
3,018
|
|
|
4,041
|
|
||
Less: short-term debt and current portion of long-term debt
|
132
|
|
|
151
|
|
||
Total long-term debt
|
$
|
2,886
|
|
|
$
|
3,890
|
|
|
2017
|
|
2018
|
|
2019
|
|
2020
|
|
2021
|
|
Thereafter
|
||||||||||||
Total debt
|
$
|
132
|
|
|
$
|
753
|
|
|
$
|
26
|
|
|
$
|
12
|
|
|
$
|
524
|
|
|
$
|
1,571
|
|
|
U.S. Pension Benefits
|
|
Non-U.S. Pension Benefits
|
|
Other Postretirement
Benefits
|
||||||||||||||||||
|
2016
|
|
2015
|
|
2016
|
|
2015
|
|
2016
|
|
2015
|
||||||||||||
Change in benefit obligation:
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Benefit obligation at beginning of year
|
$
|
735
|
|
|
$
|
728
|
|
|
$
|
798
|
|
|
$
|
872
|
|
|
$
|
107
|
|
|
$
|
122
|
|
Service cost
|
52
|
|
|
64
|
|
|
14
|
|
|
15
|
|
|
4
|
|
|
5
|
|
||||||
Interest cost
|
29
|
|
|
26
|
|
|
27
|
|
|
30
|
|
|
4
|
|
|
4
|
|
||||||
Actuarial loss (gain)
|
(13
|
)
|
|
(4
|
)
|
|
165
|
|
|
(23
|
)
|
|
—
|
|
|
(10
|
)
|
||||||
Benefits paid
|
(63
|
)
|
|
(59
|
)
|
|
(38
|
)
|
|
(35
|
)
|
|
(14
|
)
|
|
(11
|
)
|
||||||
Curtailment
|
(12
|
)
|
|
(24
|
)
|
|
(2
|
)
|
|
(2
|
)
|
|
(4
|
)
|
|
(2
|
)
|
||||||
Other
|
(2
|
)
|
|
4
|
|
|
—
|
|
|
(6
|
)
|
|
—
|
|
|
(1
|
)
|
||||||
Foreign currency translation adjustments
|
—
|
|
|
—
|
|
|
(118
|
)
|
|
(53
|
)
|
|
—
|
|
|
—
|
|
||||||
Benefit obligation at end of year
|
726
|
|
|
735
|
|
|
846
|
|
|
798
|
|
|
97
|
|
|
107
|
|
||||||
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Change in plan assets:
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Fair value of plan assets at beginning of year
|
595
|
|
|
648
|
|
|
713
|
|
|
767
|
|
|
—
|
|
|
—
|
|
||||||
Actual return on plan assets
|
29
|
|
|
(5
|
)
|
|
118
|
|
|
4
|
|
|
—
|
|
|
—
|
|
||||||
Employer contributions
|
44
|
|
|
16
|
|
|
24
|
|
|
28
|
|
|
14
|
|
|
11
|
|
||||||
Benefits paid
|
(63
|
)
|
|
(59
|
)
|
|
(38
|
)
|
|
(35
|
)
|
|
(14
|
)
|
|
(11
|
)
|
||||||
Other
|
(5
|
)
|
|
(5
|
)
|
|
—
|
|
|
(6
|
)
|
|
—
|
|
|
—
|
|
||||||
Foreign currency translation adjustments
|
—
|
|
|
—
|
|
|
(118
|
)
|
|
(45
|
)
|
|
—
|
|
|
—
|
|
||||||
Fair value of plan assets at end of year
|
600
|
|
|
595
|
|
|
699
|
|
|
713
|
|
|
—
|
|
|
—
|
|
||||||
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Funded status - underfunded at end of year
|
$
|
(126
|
)
|
|
$
|
(140
|
)
|
|
$
|
(147
|
)
|
|
$
|
(85
|
)
|
|
$
|
(97
|
)
|
|
$
|
(107
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Accumulated benefit obligation
|
$
|
682
|
|
|
$
|
681
|
|
|
$
|
810
|
|
|
$
|
763
|
|
|
$
|
97
|
|
|
$
|
107
|
|
|
U.S. Pension Benefits
|
|
Non-U.S. Pension Benefits
|
|
Other Postretirement
Benefits
|
||||||||||||||||||
|
2016
|
|
2015
|
|
2016
|
|
2015
|
|
2016
|
|
2015
|
||||||||||||
Noncurrent assets
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
3
|
|
|
$
|
51
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Current liabilities
|
(1
|
)
|
|
(2
|
)
|
|
(6
|
)
|
|
(6
|
)
|
|
(16
|
)
|
|
(16
|
)
|
||||||
Noncurrent liabilities
|
(125
|
)
|
|
(138
|
)
|
|
(144
|
)
|
|
(130
|
)
|
|
(81
|
)
|
|
(91
|
)
|
||||||
Net amount recognized
|
$
|
(126
|
)
|
|
$
|
(140
|
)
|
|
$
|
(147
|
)
|
|
$
|
(85
|
)
|
|
$
|
(97
|
)
|
|
$
|
(107
|
)
|
|
U.S. Pension Benefits
|
|
Non-U.S. Pension Benefits
|
|
Other Postretirement
Benefits
|
||||||||||||||||||
|
2016
|
|
2015
|
|
2016
|
|
2015
|
|
2016
|
|
2015
|
||||||||||||
Projected benefit obligation
|
$
|
725
|
|
|
$
|
735
|
|
|
$
|
821
|
|
|
$
|
149
|
|
|
n/a
|
|
|
n/a
|
|
||
Accumulated benefit obligation
|
$
|
682
|
|
|
$
|
681
|
|
|
$
|
786
|
|
|
$
|
114
|
|
|
$
|
97
|
|
|
$
|
107
|
|
Fair value of plan assets
|
$
|
600
|
|
|
$
|
595
|
|
|
$
|
672
|
|
|
$
|
12
|
|
|
n/a
|
|
|
n/a
|
|
|
U.S. Pension Benefits
|
|
Non-U.S. Pension Benefits
|
|
Other Postretirement
Benefits
|
||||||||||||
|
2016
|
|
2015
|
|
2016
|
|
2015
|
|
2016
|
|
2015
|
||||||
Discount rate
|
4.0
|
%
|
|
4.2
|
%
|
|
2.6
|
%
|
|
3.7
|
%
|
|
3.6
|
%
|
|
3.7
|
%
|
Rate of compensation increase
|
5.5
|
%
|
|
5.9
|
%
|
|
4.2
|
%
|
|
4.1
|
%
|
|
n/a
|
|
|
n/a
|
|
Social security increase
|
2.8
|
%
|
|
2.8
|
%
|
|
2.0
|
%
|
|
2.2
|
%
|
|
n/a
|
|
|
n/a
|
|
|
U.S. Pension Benefits
|
|
Non-U.S. Pension Benefits
|
|
Other Postretirement
Benefits
|
||||||||||||||||||
|
2016
|
|
2015
|
|
2016
|
|
2015
|
|
2016
|
|
2015
|
||||||||||||
Net actuarial loss
|
$
|
166
|
|
|
$
|
191
|
|
|
$
|
266
|
|
|
$
|
229
|
|
|
$
|
6
|
|
|
$
|
10
|
|
Net prior service cost (credit)
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(37
|
)
|
|
(54
|
)
|
||||||
Total
|
$
|
166
|
|
|
$
|
191
|
|
|
$
|
266
|
|
|
$
|
229
|
|
|
$
|
(31
|
)
|
|
$
|
(44
|
)
|
|
U.S. Pension Benefits
|
|
Non-U.S.
Pension Benefits
|
|
Other Postretirement
Benefits
|
||||||||||||||||||||||||||||||
|
2016
|
|
2015
|
|
2014
|
|
2016
|
|
2015
|
|
2014
|
|
2016
|
|
2015
|
|
2014
|
||||||||||||||||||
Service cost
|
$
|
52
|
|
|
$
|
64
|
|
|
$
|
70
|
|
|
$
|
14
|
|
|
$
|
15
|
|
|
$
|
11
|
|
|
$
|
4
|
|
|
$
|
5
|
|
|
$
|
6
|
|
Interest cost
|
29
|
|
|
26
|
|
|
28
|
|
|
27
|
|
|
30
|
|
|
34
|
|
|
4
|
|
|
4
|
|
|
5
|
|
|||||||||
Expected return on plan assets
|
(41
|
)
|
|
(49
|
)
|
|
(44
|
)
|
|
(33
|
)
|
|
(47
|
)
|
|
(41
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||||||
Amortization of prior service credit
|
—
|
|
|
1
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(9
|
)
|
|
(11
|
)
|
|
(11
|
)
|
|||||||||
Amortization of net actuarial loss
|
11
|
|
|
9
|
|
|
8
|
|
|
6
|
|
|
6
|
|
|
5
|
|
|
—
|
|
|
1
|
|
|
1
|
|
|||||||||
Curtailment gain
|
—
|
|
|
—
|
|
|
—
|
|
|
(2
|
)
|
|
(1
|
)
|
|
—
|
|
|
(7
|
)
|
|
(17
|
)
|
|
—
|
|
|||||||||
Other
|
3
|
|
|
8
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(3
|
)
|
|||||||||
Net periodic cost
|
$
|
54
|
|
|
$
|
59
|
|
|
$
|
62
|
|
|
$
|
12
|
|
|
$
|
3
|
|
|
$
|
9
|
|
|
$
|
(8
|
)
|
|
$
|
(18
|
)
|
|
$
|
(2
|
)
|
|
U.S. Pension Benefits
|
|
Non-U.S.
Pension Benefits
|
|
Other Postretirement
Benefits
|
|||||||||||||||||||||
|
2016
|
|
2015
|
|
2014
|
|
2016
|
|
2015
|
|
2014
|
|
2016
|
|
2015
|
|
2014
|
|||||||||
Discount rate
|
4.2
|
%
|
|
3.7
|
%
|
|
4.5
|
%
|
|
3.7
|
%
|
|
3.5
|
%
|
|
4.4
|
%
|
|
3.7
|
%
|
|
3.3
|
%
|
|
4.0
|
%
|
Expected long-term return on plan assets
|
7.0
|
%
|
|
7.6
|
%
|
|
7.3
|
%
|
|
5.0
|
%
|
|
6.3
|
%
|
|
6.1
|
%
|
|
n/a
|
|
|
n/a
|
|
|
n/a
|
|
Rate of compensation increase
|
5.7
|
%
|
|
5.8
|
%
|
|
5.6
|
%
|
|
4.1
|
%
|
|
4.1
|
%
|
|
4.4
|
%
|
|
n/a
|
|
|
n/a
|
|
|
n/a
|
|
Social security increase
|
2.8
|
%
|
|
2.8
|
%
|
|
2.8
|
%
|
|
2.1
|
%
|
|
2.1
|
%
|
|
2.4
|
%
|
|
n/a
|
|
|
n/a
|
|
|
n/a
|
|
|
One Percentage
Point Increase
|
|
One Percentage
Point Decrease
|
||||
Effect on total of service and interest cost components
|
$
|
0.1
|
|
|
$
|
(0.1
|
)
|
Effect on postretirement welfare benefit obligation
|
$
|
0.9
|
|
|
$
|
(1.2
|
)
|
|
2016
|
|
2015
|
||||||||||||||||||||||||||||
Asset Category
|
Total
Asset
Value
|
|
Level
One
|
|
Level
Two
|
|
Level
Three
|
|
Total
Asset
Value
|
|
Level
One
|
|
Level
Two
|
|
Level
Three
|
||||||||||||||||
Cash and Cash Equivalents
|
$
|
2
|
|
|
$
|
—
|
|
|
$
|
2
|
|
|
$
|
—
|
|
|
$
|
16
|
|
|
$
|
12
|
|
|
$
|
4
|
|
|
$
|
—
|
|
Fixed Income
(1)
|
120
|
|
|
—
|
|
|
120
|
|
|
—
|
|
|
109
|
|
|
—
|
|
|
109
|
|
|
—
|
|
||||||||
Non-U.S. Equity
(2)
|
126
|
|
|
31
|
|
|
95
|
|
|
—
|
|
|
129
|
|
|
31
|
|
|
98
|
|
|
—
|
|
||||||||
U.S. Equity
(3)
|
131
|
|
|
—
|
|
|
131
|
|
|
—
|
|
|
129
|
|
|
—
|
|
|
129
|
|
|
—
|
|
||||||||
Hedge Funds
(4)
|
150
|
|
|
—
|
|
|
—
|
|
|
150
|
|
|
152
|
|
|
—
|
|
|
—
|
|
|
152
|
|
||||||||
Real Estate Funds
(5)
|
8
|
|
|
—
|
|
|
—
|
|
|
8
|
|
|
10
|
|
|
—
|
|
|
—
|
|
|
10
|
|
||||||||
Real Estate Investment Trust Equity
|
12
|
|
|
—
|
|
|
12
|
|
|
—
|
|
|
9
|
|
|
—
|
|
|
9
|
|
|
—
|
|
||||||||
Private Equity Fund
(6)
|
51
|
|
|
—
|
|
|
—
|
|
|
51
|
|
|
41
|
|
|
—
|
|
|
—
|
|
|
41
|
|
||||||||
Total
|
$
|
600
|
|
|
$
|
31
|
|
|
$
|
360
|
|
|
$
|
209
|
|
|
$
|
595
|
|
|
$
|
43
|
|
|
$
|
349
|
|
|
$
|
203
|
|
(1)
|
A multi-manager strategy investing in fixed income securities and funds. The current allocation includes:
39%
in unconstrained bond funds;
25%
in government bonds;
12%
in corporate bonds;
10%
in government mortgage-backed securities;
6%
in a passive index bond;
1%
in commercial mortgage-backed securities;
1%
in short-term bills and notes;
1%
in asset-backed securities; and
5%
in cash and other securities.
|
(2)
|
Multi-manager strategy investing in common stocks of non-U.S. listed companies using both value and growth approaches.
|
(3)
|
Multi-manager strategy investing in common stocks of U.S. listed companies using value and growth approaches.
|
(4)
|
Strategies taking long and short positions in equities, fixed income securities, currencies and derivative contracts.
|
(5)
|
Strategy investing in the global private real estate secondary market using a value-based investment approach.
|
(6)
|
Partnership making opportunistic investments on a global basis across asset classes, capital structures and geographies.
|
|
2016
|
|
2015
|
||||||||||||||||||||||||||||
Asset Category
|
Total
Asset
Value
|
|
Level
One
|
|
Level
Two
|
|
Level
Three
|
|
Total
Asset
Value
|
|
Level
One
|
|
Level
Two
|
|
Level
Three
|
||||||||||||||||
Cash and Cash Equivalents
|
$
|
5
|
|
|
$
|
5
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
5
|
|
|
$
|
5
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Asset Allocation
(1)
|
122
|
|
|
—
|
|
|
122
|
|
|
—
|
|
|
152
|
|
|
—
|
|
|
152
|
|
|
—
|
|
||||||||
Bonds - Canada - Corporate
(2)
|
6
|
|
|
—
|
|
|
6
|
|
|
—
|
|
|
6
|
|
|
—
|
|
|
6
|
|
|
—
|
|
||||||||
Bonds - Canada - Government
(3)
|
17
|
|
|
—
|
|
|
17
|
|
|
—
|
|
|
19
|
|
|
—
|
|
|
19
|
|
|
—
|
|
||||||||
Bonds - U.K. - Corporate
(4)
|
8
|
|
|
—
|
|
|
8
|
|
|
—
|
|
|
8
|
|
|
—
|
|
|
8
|
|
|
—
|
|
||||||||
Bonds - U.K. - Government
(5)
|
225
|
|
|
—
|
|
|
225
|
|
|
—
|
|
|
211
|
|
|
—
|
|
|
211
|
|
|
—
|
|
||||||||
Bonds - Global - Corporate
(6)
|
57
|
|
|
—
|
|
|
57
|
|
|
—
|
|
|
64
|
|
|
—
|
|
|
64
|
|
|
—
|
|
||||||||
Equities
(7)
|
122
|
|
|
—
|
|
|
122
|
|
|
—
|
|
|
128
|
|
|
—
|
|
|
128
|
|
|
—
|
|
||||||||
Real Estate Fund
(8)
|
19
|
|
|
—
|
|
|
—
|
|
|
19
|
|
|
23
|
|
|
—
|
|
|
—
|
|
|
23
|
|
||||||||
Pooled Swap Funds
(9)
|
106
|
|
|
—
|
|
|
106
|
|
|
—
|
|
|
85
|
|
|
—
|
|
|
85
|
|
|
—
|
|
||||||||
Insurance contracts
|
12
|
|
|
—
|
|
|
—
|
|
|
12
|
|
|
12
|
|
|
—
|
|
|
—
|
|
|
12
|
|
||||||||
Total
|
$
|
699
|
|
|
$
|
5
|
|
|
$
|
663
|
|
|
$
|
31
|
|
|
$
|
713
|
|
|
$
|
5
|
|
|
$
|
673
|
|
|
$
|
35
|
|
(1)
|
Invests in mixes of global common stocks and bonds to achieve broad diversification.
|
(2)
|
Invests in Canadian Dollar-denominated high quality corporate bonds.
|
(3)
|
Invests in Canadian Dollar-denominated government issued bonds intended to match the duration of plan liabilities.
|
(4)
|
Invests passively in British Pound Sterling-denominated investment grade corporate bonds.
|
(5)
|
Invests passively in British Pound Sterling-denominated government issued bonds.
|
(6)
|
Invests globally in high quality corporate bonds.
|
(7)
|
Invests in broad equity funds based on securities offered in various regions or countries. Equity funds are allocated by region as follows:
47%
Global;
32%
U.K.;
7%
Emerging Markets;
5%
North America;
5%
Asia Pacific; and
4%
Europe.
|
(8)
|
Invests in a diversified range of property throughout the U.K., principally in the retail, office and industrial/warehouse sectors.
|
(9)
|
Invests in a range of pooled funds which include positions in swap contracts and U.K. sovereign bonds; pooled funds are categorized by maturities of underlying positions. Pooled funds employ leverage in order to match the U.K. Plan's duration and inflation.
|
|
U.S.
Private Equity
Fund
|
|
U.S.
Real Estate
Fund
|
|
U.S.
Hedge
Funds
|
|
Non-U.S.
Real Estate
Fund
|
|
Non-U.S.
Insurance
Contracts
|
|
Total
|
||||||||||||
Balance at December 31, 2013
|
$
|
16
|
|
|
$
|
9
|
|
|
$
|
190
|
|
|
$
|
21
|
|
|
$
|
18
|
|
|
$
|
254
|
|
Unrealized gains (losses)
|
—
|
|
|
1
|
|
|
6
|
|
|
1
|
|
|
(1
|
)
|
|
7
|
|
||||||
Realized gains
|
1
|
|
|
—
|
|
|
7
|
|
|
—
|
|
|
—
|
|
|
8
|
|
||||||
Sales
|
(4
|
)
|
|
—
|
|
|
(85
|
)
|
|
—
|
|
|
—
|
|
|
(89
|
)
|
||||||
Purchases
|
8
|
|
|
—
|
|
|
46
|
|
|
—
|
|
|
—
|
|
|
54
|
|
||||||
Balance at December 31, 2014
|
21
|
|
|
10
|
|
|
164
|
|
|
22
|
|
|
17
|
|
|
234
|
|
||||||
Unrealized gains (losses)
|
—
|
|
|
—
|
|
|
(6
|
)
|
|
—
|
|
|
(2
|
)
|
|
(8
|
)
|
||||||
Realized gains
|
—
|
|
|
1
|
|
|
1
|
|
|
—
|
|
|
—
|
|
|
2
|
|
||||||
Sales
|
(4
|
)
|
|
(2
|
)
|
|
(15
|
)
|
|
—
|
|
|
(5
|
)
|
|
(26
|
)
|
||||||
Purchases
|
24
|
|
|
1
|
|
|
8
|
|
|
1
|
|
|
2
|
|
|
36
|
|
||||||
Balance at December 31, 2015
|
41
|
|
|
10
|
|
|
152
|
|
|
23
|
|
|
12
|
|
|
238
|
|
||||||
Unrealized gains (losses)
|
3
|
|
|
1
|
|
|
—
|
|
|
(5
|
)
|
|
—
|
|
|
(1
|
)
|
||||||
Realized losses
|
—
|
|
|
—
|
|
|
(1
|
)
|
|
—
|
|
|
—
|
|
|
(1
|
)
|
||||||
Sales
|
(5
|
)
|
|
(3
|
)
|
|
(22
|
)
|
|
—
|
|
|
(3
|
)
|
|
(33
|
)
|
||||||
Purchases
|
12
|
|
|
—
|
|
|
21
|
|
|
1
|
|
|
3
|
|
|
37
|
|
||||||
Balance at December 31, 2016
|
$
|
51
|
|
|
$
|
8
|
|
|
$
|
150
|
|
|
$
|
19
|
|
|
$
|
12
|
|
|
$
|
240
|
|
Year
|
U.S. Pension
Benefits
|
Non-U.S. Pension
Benefits
|
Other Postretirement
Benefits
|
||||||||||||
2017
|
|
$
|
46
|
|
|
|
$
|
22
|
|
|
|
$
|
16
|
|
|
2018
|
|
$
|
44
|
|
|
|
$
|
24
|
|
|
|
$
|
12
|
|
|
2019
|
|
$
|
46
|
|
|
|
$
|
29
|
|
|
|
$
|
10
|
|
|
2020
|
|
$
|
47
|
|
|
|
$
|
27
|
|
|
|
$
|
9
|
|
|
2021
|
|
$
|
48
|
|
|
|
$
|
32
|
|
|
|
$
|
9
|
|
|
2022-2026
|
|
$
|
264
|
|
|
|
$
|
182
|
|
|
|
$
|
37
|
|
|
•
|
On November 24, 2014, Gary Molenda, a purported shareholder of the Company, filed a class action lawsuit in the Court of Chancery of the State of Delaware ("Delaware Chancery Court") against Baker Hughes, the Company's Board of Directors, Halliburton, and Red Tiger LLC, a wholly owned subsidiary of Halliburton ("Red Tiger" and together with all defendants, "Defendants") styled Gary R. Molenda v. Baker Hughes, Inc., et al., Case No. 10390-CB.
|
•
|
On November 26, 2014, a second purported shareholder of the Company, Booth Family Trust, filed a substantially similar class action lawsuit in Delaware Chancery Court.
|
•
|
On December 1, 2014, New Jersey Building Laborers Annuity Fund and James Rice, two additional purported shareholders of the Company, filed substantially similar class action lawsuits in Delaware Chancery Court.
|
•
|
On December 10, 2014, a fifth purported shareholder of the Company, Iron Workers Mid-South Pension Fund, filed another substantially similar class action lawsuit in the Delaware Chancery Court.
|
•
|
On December 24, 2014, a sixth purported shareholder of the Company, Annette Shipp, filed another substantially similar class action lawsuit in the Delaware Chancery Court.
|
|
Pensions and
Other
Postretirement
Benefits |
Foreign
Currency
Translation
Adjustments
|
Accumulated
Other
Comprehensive
Loss
|
||||||
Balance at December 31, 2014
|
$
|
(246
|
)
|
$
|
(503
|
)
|
$
|
(749
|
)
|
Other comprehensive income before reclassifications:
|
|
|
|
||||||
Foreign currency translation adjustments
|
|
(241
|
)
|
(241
|
)
|
||||
Pensions and other postretirement benefits:
|
|
|
|
||||||
Actuarial net loss arising in the year
|
(18
|
)
|
|
(18
|
)
|
||||
Deferred taxes
|
10
|
|
|
10
|
|
||||
|
|
|
|
||||||
Amounts reclassified from accumulated other comprehensive loss:
|
|
|
|
|
|||||
Amortization of net actuarial loss
|
16
|
|
|
16
|
|
||||
Amortization of prior service credit
|
(10
|
)
|
|
(10
|
)
|
||||
Curtailment
|
(18
|
)
|
|
(18
|
)
|
||||
Deferred taxes
|
5
|
|
|
5
|
|
||||
Balance at December 31, 2015
|
(261
|
)
|
(744
|
)
|
(1,005
|
)
|
|||
Other comprehensive income before reclassifications:
|
|
|
|
|
|||||
Foreign currency translation adjustments
|
|
(5
|
)
|
(5
|
)
|
||||
Pensions and other postretirement benefits:
|
|
|
|
|
|||||
Actuarial net loss arising in the year
|
(23
|
)
|
|
(23
|
)
|
||||
|
|
|
|
||||||
Amounts reclassified from accumulated other comprehensive loss:
|
|
|
|
||||||
Amortization of net actuarial loss
|
17
|
|
|
17
|
|
||||
Amortization of prior service credit
|
(9
|
)
|
|
(9
|
)
|
||||
Curtailment
|
(9
|
)
|
|
(9
|
)
|
||||
Deferred taxes
|
1
|
|
|
1
|
|
||||
Balance at December 31, 2016
|
$
|
(284
|
)
|
$
|
(749
|
)
|
$
|
(1,033
|
)
|
|
First
Quarter
|
|
Second
Quarter
|
|
Third Quarter
|
|
Fourth Quarter
|
|
Total
Year
|
||||||||||
2016
|
|
|
|
|
|
|
|
|
|
||||||||||
Revenue
|
$
|
2,670
|
|
|
$
|
2,408
|
|
|
$
|
2,353
|
|
|
$
|
2,410
|
|
|
$
|
9,841
|
|
Gross profit
(1)
|
(90
|
)
|
|
(803
|
)
|
|
203
|
|
|
174
|
|
|
(516
|
)
|
|||||
Impairment and restructuring charges
(2)
|
160
|
|
|
1,126
|
|
|
304
|
|
|
145
|
|
|
1,735
|
|
|||||
Goodwill impairment
(3)
|
—
|
|
|
1,841
|
|
|
17
|
|
|
—
|
|
|
1,858
|
|
|||||
Merger termination fee
(4)
|
—
|
|
|
(3,500
|
)
|
|
—
|
|
|
—
|
|
|
(3,500
|
)
|
|||||
Net loss attributable to Baker Hughes
|
(981
|
)
|
|
(911
|
)
|
|
(429
|
)
|
|
(417
|
)
|
|
(2,738
|
)
|
|||||
Basic and diluted loss per share attributable to Baker Hughes
|
(2.22
|
)
|
|
(2.08
|
)
|
|
(1.00
|
)
|
|
(0.98
|
)
|
|
(6.31
|
)
|
|||||
Dividends per share
|
0.17
|
|
|
0.17
|
|
|
0.17
|
|
|
0.17
|
|
|
0.68
|
|
|||||
Common stock market prices:
|
|
|
|
|
|
|
|
|
|
||||||||||
High
|
47.44
|
|
|
49.52
|
|
|
52.70
|
|
|
66.89
|
|
|
|
||||||
Low
|
38.88
|
|
|
39.36
|
|
|
43.54
|
|
|
49.96
|
|
|
|
||||||
|
|
|
|
|
|
|
|
|
|
||||||||||
2015
|
|
|
|
|
|
|
|
|
|
||||||||||
Revenue
|
$
|
4,594
|
|
|
$
|
3,968
|
|
|
$
|
3,786
|
|
|
$
|
3,394
|
|
|
$
|
15,742
|
|
Gross profit
(1)
|
114
|
|
|
266
|
|
|
301
|
|
|
180
|
|
|
861
|
|
|||||
Impairment and restructuring charges
(2)
|
573
|
|
|
76
|
|
|
98
|
|
|
1,246
|
|
|
1,993
|
|
|||||
Net loss attributable to Baker Hughes
|
(589
|
)
|
|
(188
|
)
|
|
(159
|
)
|
|
(1,031
|
)
|
|
(1,967
|
)
|
|||||
Basic and diluted loss per share attributable to Baker Hughes
|
(1.35
|
)
|
|
(0.43
|
)
|
|
(0.36
|
)
|
|
(2.35
|
)
|
|
(4.49
|
)
|
|||||
Dividends per share
|
0.17
|
|
|
0.17
|
|
|
0.17
|
|
|
0.17
|
|
|
0.68
|
|
|||||
Common stock market prices:
|
|
|
|
|
|
|
|
|
|
||||||||||
High
|
65.04
|
|
|
69.13
|
|
|
61.13
|
|
|
57.33
|
|
|
|
||||||
Low
|
53.53
|
|
|
61.11
|
|
|
45.76
|
|
|
43.36
|
|
|
|
(1)
|
Represents revenue less cost of sales, cost of services and research and engineering.
|
(2)
|
Impairment and restructuring charges associated with asset impairments, workforce reductions, facility closures and contract terminations recorded during 2015 and 2016. See Note 4. "Impairment and Restructuring Charges" for further discussion.
|
(3)
|
Goodwill impairment recognized in the second and third quarters of 2016. See Note 12. "Goodwill and Intangible Assets" for further discussion.
|
(4)
|
Merger termination fee received from Halliburton. See Note 2. "Halliburton Terminated Merger Agreement" for further discussion.
|
Equity Compensation Plan
Category
|
Number of
Securities to be
Issued Upon
Exercise of
Outstanding
Options, Warrants
and Rights
|
|
Weighted Average
Exercise Price of
Outstanding
Options, Warrants
and Rights
|
|
Number of Securities
Remaining Available
for Future Issuance
Under Equity
Compensation Plans
(excluding securities
reflected in the first
column)
|
||||||||||
Stockholder-approved plans (excluding Employee Stock Purchase Plan)
|
|
7.1
|
|
|
|
|
$
|
54.11
|
|
|
|
|
16.4
|
|
|
Nonstockholder-approved plans
(1)
|
|
0.1
|
|
|
|
|
46.72
|
|
|
|
|
0.5
|
|
|
|
Subtotal (except for weighted average exercise price)
|
|
7.2
|
|
|
|
|
54.09
|
|
|
|
|
16.9
|
|
|
|
Employee Stock Purchase Plan
(2)
|
|
—
|
|
|
|
|
—
|
|
|
|
|
2.7
|
|
|
|
Total
|
|
7.2
|
|
|
|
|
$
|
54.09
|
|
|
|
|
19.6
|
|
|
(1)
|
The table includes the following nonstockholder-approved plan: the Director Compensation Deferral Plan. A description of this plan is set forth below.
|
(2)
|
The per share purchase price under the Baker Hughes Incorporated Employee Stock Purchase Plan is determined in accordance with section 423 of the Code and is 85% of the lower of the fair market value of a share of our common stock on the date of grant or the date of purchase.
|
Exhibit
Number
|
Exhibit Description
|
2.1
|
Agreement and Plan of Merger dated as of November 16, 2014 among Halliburton Company, Red Tiger LLC and Baker Hughes Incorporated (filed as Exhibit 2.1 to the Current Report of Baker Hughes Incorporated on Form 8-K filed on November 18, 2014).
|
2.2
|
Transaction Agreement and Plan of Merger dated as of October 30, 2016 among General Electric Company, Baker Hughes Incorporated, Bear Newco, Inc. and Bear MergerSub, Inc. (filed as Exhibit 2.1 to the Current Report of Baker Hughes Incorporated on Form 8-K filed on November 1, 2016).
|
2.3
|
Contribution Agreement dated as of November 29, 2016 among Baker Hughes Oilfield Operations, Inc., BJ Services LLC, and Allied Completions Holdings, LLC (filed as Exhibit 2.1 to the Current Report to Baker Hughes Incorporated on Form 8-K on December 1, 2016).
|
3.1
|
Certificate of Amendment dated April 22, 2010 and the Restated Certificate of Incorporation (filed as Exhibit 3.1 to the Quarterly Report of Baker Hughes Incorporated on Form 10-Q for the quarter ended March 31, 2010).
|
3.2
|
Restated Bylaws of Baker Hughes Incorporated effective as of January 26, 2017 (filed as Exhibit 3.1 to the Current Report of Baker Hughes Incorporated on Form 8-K filed on January 31, 2017).
|
4.1
|
Rights of Holders of the Company's Long-Term Debt. The Company has no long-term debt instrument with regard to which the securities authorized thereunder equal or exceed 10% of the total assets of the Company and its subsidiaries on a consolidated basis. The Company agrees to furnish a copy of its long-term debt instruments to the SEC upon request.
|
4.2
|
Certificate of Amendment dated April 22, 2010 and the Restated Certificate of Incorporation (filed as Exhibit 3.1 to the Quarterly Report of Baker Hughes Incorporated on Form 10-Q for the quarter ended March 31, 2010).
|
4.3
|
Restated Bylaws of Baker Hughes Incorporated effective as of January 26, 2017 (filed as Exhibit 3.1 to the Current Report of Baker Hughes Incorporated on Form 8-K filed on January 31, 2017).
|
4.4
|
Indenture dated as of May 15, 1994 between Western Atlas Inc. and The Bank of New York, Trustee, providing for the issuance of securities in series (filed as Exhibit 4.4 to the Annual Report of Baker Hughes Incorporated on Form 10-K for the year ended December 31, 2004).
|
4.5
|
Indenture dated October 28, 2008, between Baker Hughes Incorporated and The Bank of New York Mellon Trust Company, N.A., as trustee (filed as Exhibit 4.1 to the Current Report of Baker Hughes Incorporated on Form 8-K filed on October 29, 2008).
|
4.6
|
First Supplemental Indenture, dated August 17, 2011, between Baker Hughes Incorporated and The Bank of New York Mellon Trust Company, N.A., as trustee (including form of Notes) (filed as Exhibit 4.2 to the Current Report of Baker Hughes Incorporated on Form 8-K filed August 23, 2011).
|
4.7
|
Officers' Certificate of Baker Hughes Incorporated dated October 28, 2008 establishing the 6.50% Senior Notes due 2013 and the 7.50% Senior Notes due 2018 (filed as Exhibit 4.2 to the Current Report of Baker Hughes Incorporated on Form 8-K filed on October 29, 2008).
|
4.8
|
Form of 7.50% Senior Notes Due 2018 (filed as Exhibit 4.4 to the Current Report of Baker Hughes Incorporated on Form 8-K filed on October 29, 2008).
|
4.9
|
Officers' Certificate of Baker Hughes Incorporated dated August 24, 2010 establishing the 5.125% Senior Notes due 2040 (filed as Exhibit 4.2 to the Current Report of Baker Hughes Incorporated on Form 8-K filed on August 24, 2010).
|
4.10
|
Form of 5.125% Senior Notes due 2040 (filed as Exhibit 4.3 to the Current Report of Baker Hughes Incorporated on Form 8-K filed on August 24, 2010).
|
4.11
|
Indenture, dated June 8, 2006, between BJ Services Company, as issuer, and Wells Fargo Bank, N.A., as trustee (filed as Exhibit 4.1 to the Current Report of BJ Services Company on Form 8-K filed on June 12, 2006).
|
4.12
|
Third Supplemental Indenture, dated May 19, 2008, between BJ Services Company, as issuer, and Wells Fargo Bank, N.A., as trustee, with respect to the 6% Senior Notes due 2018 (filed as Exhibit 4.2 to the Current Report of BJ Services Company on Form 8-K filed on May 23, 2008).
|
4.13
|
Fourth Supplemental Indenture, dated April 28, 2010, between BJ Services Company, as issuer, BSA Acquisition LLC, Baker Hughes Incorporated and Wells Fargo Bank, N.A., as trustee, with respect to the 5.75% Senior Notes due 2011 and the 6% Senior Notes due 2018 (filed as Exhibit 4.4 to the Current Report of Baker Hughes Incorporated on Form 8-K filed on April 29, 2010).
|
4.14
|
Fifth Supplemental Indenture, dated June 21, 2011, between BJ Services Company LLC, as company, Western Atlas Inc. as successor company and Wells Fargo Bank, N.A., as trustee, with respect to the 6.00% Senior Notes due 2018 (incorporated by reference to Exhibit 4.4 to the Current Report of Baker Hughes Incorporated on Form 8-K filed on June 23, 2011).
|
4.15
|
Registration Rights Agreement dated August 17, 2011 among Baker Hughes Incorporated and J.P. Morgan Securities LLC and Merrill Lynch, Pierce, Fenner & Smith Incorporated, as representatives of the several initial purchasers named therein (filed as Exhibit 10.1 to the Current Report of Baker Hughes Incorporated on Form 8-K filed on August 23, 2011).
|
10.1+
|
Form of Amended and Restated Change in Control Agreement between Baker Hughes Incorporated and each of the executive officers effective as of January 1, 2009 (filed as Exhibit 10.2 to the Current Report of Baker Hughes Incorporated on Form 8-K filed on December 19, 2008).
|
10.2+
|
Amendment and Restatement of the Baker Hughes Incorporated Change in Control Severance Plan effective as of January 1, 2009 (filed as Exhibit 10.3 to the Current Report of Baker Hughes Incorporated on Form 8-K filed on December 19, 2008).
|
10.3+
|
Form of Change in Control Agreement between Baker Hughes Incorporated and certain of the executive officers effective as of July 16, 2012 (filed as Exhibit 10.1 to the Quarterly Report of Baker Hughes Incorporated on Form 10-Q for the quarter ended June 30, 2012).
|
10.4+
|
Form of Executive Loyalty, Confidentiality, Non-Solicitation, and Non-Competition Agreement between Baker Hughes Incorporated and certain of the executive officers (filed as Exhibit 10.3 to the Annual Report of Baker Hughes Incorporated on Form 10-K for the year ended December 31, 2011).
|
10.5+
|
Baker Hughes Incorporated Compensation Recoupment Policy effective January 1, 2014 (filed as Exhibit 10.10 to the Current Report of Baker Hughes Incorporated on Form 8-K filed on January 28, 2014).
|
10.6+
|
Letter Agreement between Baker Hughes Incorporated and Alan R. Crain dated July 29, 2016 (filed as Exhibit 10.1 to the Quarterly Report of Baker Hughes Incorporated on Form 10-Q for the quarter ended September 30, 2016).
|
10.7 +*
|
Letter Agreement between Baker Hughes Incorporated and Kimberly A. Ross dated December 30, 2016.
|
10.8+
|
Form of Indemnification Agreement between Baker Hughes Incorporated and each of the directors and executive officers (filed as Exhibit 10.4 to the Annual Report of Baker Hughes Incorporated on Form 10-K for the year ended December 31, 2003).
|
10.9+
|
Form of Amendment to the Indemnification Agreement between Baker Hughes Incorporated and each of the directors and executive officers effective as of January 1, 2009 (filed as Exhibit 10.4 to the Current Report of Baker Hughes Incorporated on Form 8-K filed on December 19, 2008).
|
10.10+
|
Baker Hughes Incorporated Director Retirement Policy for Certain Members of the Board of Directors (filed as Exhibit 10.10 to the Annual Report of Baker Hughes Incorporated on Form 10-K for the year ended December 31, 2003).
|
10.11+
|
Baker Hughes Incorporated Director Compensation Deferral Plan, as amended and restated effective as of January 1, 2009 (filed as Exhibit 10.2 to the Quarterly Report of Baker Hughes Incorporated on Form 10-Q for the quarter ended June 30, 2008).
|
10.12+
|
Amendment to Baker Hughes Incorporated Director Compensation Deferral Plan effective as of January 1, 2009 (filed as Exhibit 10.5 to the Current Report of Baker Hughes Incorporated on Form 8-K filed on December 19, 2008).
|
10.13+
|
Amendment to the Baker Hughes Incorporated Director Compensation Deferral Plan effective as of July 25, 2013 (filed as Exhibit 10.11 to the Annual Report of Baker Hughes Incorporated on Form 10-K for the year ended December 31, 2013).
|
10.14 +
|
Amendment and Restatement of the Baker Hughes Incorporated Executive Severance Plan effective as of May 24, 2016 (filed as Exhibit 10.1 to the Current Report of Baker Hughes Incorporated on Form 8-K filed on May 25, 2016).
|
10.15+
|
Baker Hughes Incorporated Annual Incentive Compensation Plan for officers, as amended and restated on January 23, 2014 (filed as Exhibit 10.5 to the Current Report of Baker Hughes Incorporated on Form 8-K filed on January 28, 2014).
|
10.16+
|
Amendment to the Amended and Restated Baker Hughes Incorporated Annual Incentive Compensation Plan for employees dated March 13, 2015 (filed as Exhibit 10.2 to the Current Report of Baker Hughes Incorporated on Form 8-K filed on March 18, 2015).
|
10.17+
|
Baker Hughes Incorporated Supplemental Retirement Plan, as amended and restated effective as of January 1, 2012 (filed as Exhibit 10.1 to the Current Report of Baker Hughes Incorporated on Form 8-K filed on December 20, 2011).
|
10.18+
|
Amended and Restated Baker Hughes Incorporated 2002 Employee Long-Term Incentive Plan effective April 24, 2014 (filed as Exhibit 10.2 to the Current Report of Baker Hughes Incorporated on Form 8-K filed on April 29, 2014).
|
10.19+
|
Amended and Restated Baker Hughes Incorporated 2002 Director & Officer Long-Term Incentive Plan effective April 24, 2014 (filed as Exhibit 10.1 to the Current Report of Baker Hughes Incorporated on Form 8-K filed on April 29, 2014).
|
10.20+
|
Baker Hughes Incorporated Employee Stock Purchase Plan, as amended and restated, effective as of January 1, 2012 (filed as Exhibit 10.25 to the Annual Report of Baker Hughes Incorporated on Form 10-K for the year ending December 31, 2012).
|
10.21+
|
Amendment to the Baker Hughes Incorporated Employee Stock Purchase Plan effective as of April 25, 2013 (filed as Exhibit 10.2 to the Current Report of Baker Hughes Incorporated on Form 8-K filed on April 30, 2013).
|
10.22+
|
Amendment to the Baker Hughes Incorporated Employee Stock Purchase Plan effective as of December 31, 2014 (filed as Exhibit 10.28 to the Annual Report of Baker Hughes Incorporated on Form 10-K for the fiscal year ending December 31, 2014)
.
|
10.23+
|
Form of Baker Hughes Incorporated Nonqualified Stock Option Agreement with Terms and Conditions for officers (filed as Exhibit 10.30 to the Annual Report of Baker Hughes Incorporated on Form 10-K for the year ended December 31, 2009).
|
10.24+
|
Form of Baker Hughes Incorporated Nonqualified Stock Option Award Agreement and Terms and Conditions for officers (filed as Exhibit 10.70 to the Annual Report of Baker Hughes Incorporated on Form 10-K for the year ended December 31, 2011).
|
10.25+
|
Form of Baker Hughes Incorporated Nonqualified Stock Option Award Agreement and Terms and Conditions for officers (filed as Exhibit 10.6 to the Current Report of Baker Hughes Incorporated on Form 8-K filed on January 28, 2014).
|
10.26+
|
Form of Baker Hughes Incorporated Nonqualified Stock Option Award Agreement and Terms and Conditions for officers (filed as Exhibit 10.6 to the Quarterly Report of Baker Hughes Incorporated on Form 10-Q for the quarter ended June 30, 2014).
|
10.27+
|
Form of Baker Hughes Incorporated Incentive Stock Option Award Agreement and Terms and Conditions for officers (filed as Exhibit 10.33 to the Annual Report of Baker Hughes Incorporated on Form 10-K for the year ended December 31, 2009).
|
10.28+
|
Form of Baker Hughes Incorporated Incentive Stock Option Award Agreement and Terms and Conditions for officers (filed as Exhibit 10.71 to the Annual Report of Baker Hughes Incorporated on Form 10-K for the year ended December 31, 2011).
|
10.29+
|
Form of Baker Hughes Incorporated Incentive Stock Option Award Agreement and Terms and Conditions for officers (filed as Exhibit 10.7 to the Current Report of Baker Hughes Incorporated on Form 8-K filed on January 28, 2014).
|
10.30+
|
Form of Baker Hughes Incorporated Incentive Stock Option Award Agreement and Terms and Conditions for officers (filed as Exhibit 10.7 to the Quarterly Report of Baker Hughes Incorporated on Form 10-Q for the quarter ended June 30, 2014).
|
10.31+
|
Form of Baker Hughes Incorporated Restricted Stock Unit Award Agreement and Terms and Conditions for officers (filed as Exhibit 10.9 to the Current Report of Baker Hughes Incorporated on Form 8-K filed on January 28, 2014).
|
10.32+
|
Form of Baker Hughes Incorporated Restricted Stock Award Agreement and Terms and Conditions for officers (filed as Exhibit 10.8 to the Current Report of Baker Hughes Incorporated on Form 8-K filed on January 28, 2014).
|
10.33+
|
Form of Baker Hughes Incorporated Restricted Stock Unit Award Agreement and Terms and Conditions for officers (filed as Exhibit 10.5 to the Quarterly Report of Baker Hughes Incorporated on Form 10-Q for the quarter ended June 30, 2014).
|
10.34+
|
Form of Baker Hughes Incorporated Restricted Stock Unit Award Agreement and Terms and Conditions for officers (filed as Exhibit 10.42 to the Annual Report of Baker Hughes Incorporated on Form 10-K for the year ended December 31, 2014).
|
10.35+
|
Form of Baker Hughes Incorporated Restricted Stock Award Agreement and Terms and Conditions for officers (filed as Exhibit 10.2 to the Current Report of Baker Hughes Incorporated on Form 8-K filed on May 25, 2016).
|
10.36+
|
Form of Baker Hughes Incorporated Restricted Stock Unit Award Agreement and Terms and Conditions for officers with a three-year cliff vesting (filed as Exhibit 10.1 to the Current Report of Baker Hughes Incorporated on Form 8-K filed on July 29, 2016).
|
10.37+
|
Form of Baker Hughes Incorporated Restricted Stock Unit Award Agreement and Terms and Conditions for officers with a three-year graded vesting (filed as Exhibit 10.2 to the Current Report of Baker Hughes Incorporated on Form 8-K filed on July 29, 2016).
|
10.38+
|
Form of Baker Hughes Incorporated Restricted Stock Unit Award Agreement and Terms and Conditions for officers with a three-year graded vesting (filed as Exhibit 10.2 to the Current Report of Baker Hughes Incorporated on Form 8-K filed on January 31, 2017).
|
10.39+
|
Form of Baker Hughes Incorporated Restricted Stock Unit Award Agreement and Terms and Conditions for officers with a three-year cliff vesting (filed as Exhibit 10.1 to the Current Report of Baker Hughes Incorporated on Form 8-K filed on January 31, 2017).
|
10.40+
|
Form of Baker Hughes Incorporated Restricted Stock Unit Award Agreement and Terms and Conditions for directors (filed as Exhibit 10.44 to the Annual Report of Baker Hughes Incorporated on Form 10-K for the year ended December 31, 2014).
|
10.41+*
|
Form of Baker Hughes Incorporated Restricted Stock Unit Award Agreement and Terms and Conditions for directors.
|
10.42+
|
Form of Baker Hughes Incorporated Stock Option Award Agreement, including Terms and Conditions for directors (filed as Exhibit 10.41 to the Annual Report of Baker Hughes Incorporated on Form 10-K for the year ended December 31, 2005).
|
10.43+
|
Form of Baker Hughes Incorporated Performance Unit Award Agreement and Terms and Conditions for certain officers payable in cash (filed as Exhibit 10.3 to the Current Report of Baker Hughes Incorporated on Form 8-K filed on January 28, 2014).
|
10.44+
|
Form of Baker Hughes Incorporated Performance Unit Award Agreement and Terms and Conditions for certain officers payable in shares (filed as Exhibit 10.4 to the Current Report of Baker Hughes Incorporated on Form 8-K filed on January 28, 2014).
|
10.45+
|
Form of Baker Hughes Incorporated Performance Unit Award Agreement and Terms and Conditions for certain officers payable in cash (filed as Exhibit 10.3 to the Quarterly Report of Baker Hughes Incorporated on Form 10-Q for the quarter ended June 30, 2014).
|
10.46+
|
Form of Baker Hughes Incorporated Performance Unit Award Agreement and Terms and Conditions for certain officers payable in shares (filed as Exhibit 10.4 to the Quarterly Report of Baker Hughes Incorporated on Form 10-Q for the quarter ended June 30, 2014).
|
10.47+
|
Form of Baker Hughes Incorporated Performance Based Restricted Stock Unit Award Agreement and Terms and Conditions for officers with a three-year cliff vesting (filed as Exhibit 10.3 to the Current Report of Baker Hughes Incorporated on Form 8-K filed on January 31, 2017).
|
10.48+
|
Performance Goals adopted January 22, 2014 for the Performance Unit Awards payable in cash granted in 2014 (filed as Exhibit 10.1 to the Current Report of Baker Hughes Incorporated on Form 8-K filed on January 28, 2014).
|
10.49+
|
Performance Goals adopted January 22, 2014 for the Performance Unit Awards payable in shares granted in 2014 (filed as Exhibit 10.2 to the Current Report of Baker Hughes Incorporated on Form 8-K filed on January 28, 2014).
|
10.50+
|
Performance Goals adopted January 25, 2017 for the Performance Based Restricted Stock Unit Awards granted in 2017 (filed as Exhibit 10.4 to the Current Report of Baker Hughes Incorporated on Form 8-K filed on January 31, 2017).
|
10.51
|
Credit Agreement dated as of July 13, 2016, among Baker Hughes Incorporated, JP Morgan Chase Bank, N.A., as Administrative Agent and twenty lenders for $2.5 billion, in the aggregate for all banks (filed as Exhibit 10.1 to the Current Report of Baker Hughes Incorporated on Form 8-K filed July 14, 2016).
|
10.52
|
Plea Agreement between Baker Hughes Services International, Inc. and the United States Department of Justice filed on April 26, 2007, with the United States District Court of Texas, Houston Division (filed as Exhibit 10.5 to the Quarterly Report of Baker Hughes Incorporated on Form 10-Q for the quarter ended March 31, 2007).
|
10.53
|
Termination Agreement dated as of April 30, 2016 among Halliburton Company, Red Tiger LLC and Baker Hughes Incorporated (filed as Exhibit 10.1 to the Current Report of Baker Hughes Incorporated on Form 8-K filed on May 2, 2016).
|
21.1*
|
Subsidiaries of Company.
|
23.1*
|
Consent of Deloitte & Touche LLP.
|
31.1**
|
Certification of Martin S. Craighead, Chairman and Chief Executive Officer, furnished pursuant to Rule 13a-14(a) of the Securities Exchange Act of 1934, as amended.
|
31.2**
|
Certification of Kimberly A. Ross, Chief Financial Officer, furnished pursuant to Rule 13a-14(a) of the Securities Exchange Act of 1934, as amended.
|
32**
|
Statement of Martin S. Craighead, Chairman and Chief Executive Officer, and Kimberly A. Ross, Chief Financial Officer, furnished pursuant to Rule 13a-14(b) of the Securities Exchange Act of 1934, as amended.
|
95*
|
Mine Safety Disclosures.
|
101.INS*
|
XBRL Instance Document.
|
101.SCH*
|
XBRL Schema Document.
|
101.CAL*
|
XBRL Calculation Linkbase Document.
|
101.LAB*
|
XBRL Label Linkbase Document.
|
101.PRE*
|
XBRL Presentation Linkbase Document.
|
101.DEF*
|
XBRL Definition Linkbase Document.
|
(In millions)
|
Balance at
Beginning
of Period
|
|
Charged to
Cost and
Expenses
|
|
Write-offs
(1)
|
|
Other
Changes
(2) (3)
|
|
Balance at
End of
Period
|
||||||||||
Year Ended December 31, 2016
|
|
|
|
|
|
|
|
|
|
||||||||||
Reserve for doubtful accounts receivable
|
$
|
383
|
|
|
$
|
188
|
|
|
$
|
(59
|
)
|
|
$
|
(3
|
)
|
|
$
|
509
|
|
Reserve for inventories
|
278
|
|
|
181
|
|
|
(275
|
)
|
|
4
|
|
|
188
|
|
|||||
Year Ended December 31, 2015
|
|
|
|
|
|
|
|
|
|
||||||||||
Reserve for doubtful accounts receivable
|
224
|
|
|
193
|
|
|
(23
|
)
|
|
(11
|
)
|
|
383
|
|
|||||
Reserve for inventories
|
319
|
|
|
195
|
|
|
(235
|
)
|
|
(1
|
)
|
|
278
|
|
|||||
Year Ended December 31, 2014
|
|
|
|
|
|
|
|
|
|
||||||||||
Reserve for doubtful accounts receivable
|
238
|
|
|
102
|
|
|
(71
|
)
|
|
(45
|
)
|
|
224
|
|
|||||
Reserve for inventories
|
382
|
|
|
37
|
|
|
(92
|
)
|
|
(8
|
)
|
|
319
|
|
(1)
|
Represents the elimination of accounts receivable and inventory deemed uncollectible or worthless. See Note 10. "Inventories" of the Notes to Consolidated Financial Statements in Item 8 herein for further discussion of the inventory write-offs and related reserves.
|
(2)
|
Represents transfers, currency translation adjustments and divestitures.
|
(3)
|
For the year ended December 31, 2014, the reserve for doubtful accounts receivable includes a
$39 million
reduction due to the currency devaluation in Venezuela.
|
|
|
|
BAKER HUGHES INCORPORATED
|
|
|
|
|
Date:
|
February 7, 2017
|
|
/s/ MARTIN S. CRAIGHEAD
|
|
|
|
Martin S. Craighead
Chairman and Chief Executive Officer
|
Signature
|
|
Title
|
|
|
|
/
S
/ MARTIN S. CRAIGHEAD
|
|
Chairman and Chief Executive Officer
|
(Martin S. Craighead)
|
|
(principal executive officer)
|
|
|
|
/
S
/ KIMBERLY A. ROSS
|
|
Senior Vice President and Chief Financial Officer
|
(Kimberly A. Ross)
|
|
(principal financial officer)
|
|
|
|
/
S
/ KELLY C. JANZEN
|
|
Vice President, Controller and Chief Accounting Officer
|
(Kelly C. Janzen)
|
|
(principal accounting officer)
|
/s/ GREGORY D. BRENNEMAN
|
|
Director
|
(Gregory D. Brenneman)
|
|
|
|
|
|
/s/ CLARENCE P. CAZALOT, JR.
|
|
Director
|
(Clarence P. Cazalot, Jr.)
|
|
|
|
|
|
/s/ WILLIAM H. EASTER III
|
|
Director
|
(William H. Easter III)
|
|
|
|
|
|
/s/ LYNN L. ELSENHANS
|
|
Director
|
(Lynn L. Elsenhans)
|
|
|
|
|
|
/s/ ANTHONY G. FERNANDES
|
|
Director
|
(Anthony G. Fernandes)
|
|
|
|
|
|
/s/ CLAIRE W. GARGALLI
|
|
Director
|
(Claire W. Gargalli)
|
|
|
|
|
|
/s/ PIERRE H. JUNGELS
|
|
Director
|
(Pierre H. Jungels)
|
|
|
|
|
|
/s/ JAMES A. LASH
|
|
Director
|
(James A. Lash)
|
|
|
|
|
|
/s/ J. LARRY NICHOLS
|
|
Director
|
(J. Larry Nichols)
|
|
|
|
|
|
/s/ JAMES W. STEWART
|
|
Director
|
(James W. Stewart)
|
|
|
|
|
|
/s/ CHARLES L. WATSON
|
|
Director
|
(Charles L. Watson)
|
|
|
|
|
|
(a)
|
the first anniversary of the Date of Award (the “
General Lapse Date
”) provided that your service on the Board has not terminated prior to such date; and
|
(b)
|
the date of the annual meeting of the stockholders of the Company next following the date of your 75
th
birthday, provided that your service on the Board has not terminated prior to such date of annual meeting of the stockholders of the Company.
|
|
|
|
|
|
BAKER HUGHES INCORPORATED
|
|
|
|
|
|
|
|
|
Martin S. Craighead
President and Chief Executive Officer
|
1.
|
|
TERMINATION OF SERVICE.
The following provisions will apply in the event your service on the Board terminates before the General Lapse Date set forth under the terms of the Restricted Stock Unit Award Agreement awarded to you (the “
Agreement
”):
|
1.1
|
Termination Generally
. Subject to Section 2, if your service on the Board terminates on or before the General Lapse Date for any reason other than one of the reasons described in Sections 1.2 through 1.5, the Forfeiture Restrictions then applicable to the Restricted Stock Units shall not lapse and the number of Restricted Stock Units then subject to the Forfeiture Restrictions shall be forfeited to the Company on the date your service on the Board terminates.
|
1.2
|
Disability
. Notwithstanding any other provision of the Agreement or these Terms and Conditions to the contrary, if you become permanently disabled before the General Lapse Date and before your service on the Board terminates, all remaining Forfeiture Restrictions shall immediately lapse on the date your service on the Board terminates due to your becoming permanently disabled. For purposes of this Section 1.2, you will be “
permanently disabled
” if you are unable to engage in any substantial gainful activity by reason of any medically determinable physical or mental impairment which can be expected to result in death or can be expected to last for a continuous period of not less than 12 months.
|
1.3
|
Death
. Notwithstanding any other provision of the Agreement or these Terms and Conditions to the contrary, if you die before the General Lapse Date and before your service on the Board terminates, all remaining Forfeiture Restrictions shall immediately lapse on the date your service on the Board terminates due to death.
|
1.4
|
Completion of Term
. Notwithstanding any other provision of the Agreement or these Terms and Conditions to the contrary, if you complete before the General Lapse Date the term for which you were elected to the Board (the “
Term
”) and as a result thereof your service on the Board terminates, all remaining Forfeiture Restrictions shall immediately lapse on the last day of the Term.
|
1.5
|
Attainment of Retirement Age
. Notwithstanding any other provision of the Agreement or these Terms and Conditions to the contrary, if you attain the age of 75 and your service on the Board has not terminated prior to the date of the annual meeting of the stockholders of the Company that next follows your 75
th
birthday, all remaining forfeiture restrictions shall immediately lapse on such date of annual meeting of the stockholders of the Company.
|
2.
|
|
CHANGE IN CONTROL OF THE COMPANY
. Notwithstanding any other provision of the Agreement or these Terms and Conditions to the contrary, if a Change in Control of the Company occurs before the General Lapse Date and before you cease to be a member of the Board, then all remaining Forfeiture Restrictions shall immediately lapse on the effective date of the Change in Control of the Company provided that the transaction qualifies as a change in the ownership or effective control of the Company, or in the sale of a substantial portion of the assets of the Company, within the meaning of section 409A of the Internal Revenue Code of 1986, as amended and Department of Treasury regulations issued thereunder.
|
|
|
|
3.
|
|
NONTRANSFERABILITY.
The Agreement is not transferable by you otherwise than by will or by the laws of descent and distribution.
|
|
||
4.
|
|
CAPITAL ADJUSTMENTS AND REORGANIZATIONS.
The existence of the Restricted Stock Units shall not affect in any way the right or power of the Company or any company the stock of which is awarded pursuant to the Agreement to make or authorize any adjustment, recapitalization, reorganization or other change in its capital structure or its business, engage in any merger or consolidation, issue any debt or equity securities, dissolve or liquidate, or sell, lease, exchange or otherwise dispose of all or any part of its assets or business, or engage in any other corporate act or proceeding.
|
|
|
|
5.
|
|
RESTRICTED STOCK UNITS DO NOT AWARD ANY RIGHTS OF A SHAREHOLDER
. You shall not have the voting rights or any of the other rights, powers or privileges of a holder of the Common Stock with respect to the Restricted Stock Units that are awarded hereby. Only after a share of the Common Stock is issued in exchange for a Restricted Stock Unit will you have all of the rights of a shareholder with respect to such share of Common Stock issued in exchange for a Restricted Stock Unit.
|
|
|
|
6.
|
|
SECURITIES ACT LEGEND.
You consent to the placing on any certificate for the shares of Common Stock issued under the Agreement an appropriate legend restricting resale or other transfer of the Shares except in accordance with the Securities Act of 1933, as amended and all applicable rules thereunder.
|
|
|
|
7.
|
|
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.
|
|
|
|
8.
|
|
MISCELLANEOUS
. The Agreement is awarded pursuant to 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. The term “
you
” and “
your
” refer to the Awardee named in the Agreement. Capitalized terms that are not defined herein shall have the meanings ascribed to such terms in the Plan or the Agreement.
|
Subsidiary
|
Jurisdiction
|
Percentage Ownership
|
Western Atlas, Inc.
|
Delaware
|
100%
|
Baker Hughes Oilfield Operations, Inc.
|
California
|
(1)
|
Baker Hughes International Holding Company
|
Delaware
|
100%
|
Baker Hughes General Holdings SECS LLC
|
Delaware
|
100%
|
Baker Hughes International Branches, Inc.
|
Delaware
|
(2)
|
Baker Hughes EHHC, Inc.
|
Delaware
|
(3)
|
Baker Hughes International Partners Holdings SCS
|
Luxembourg
|
(4)
|
Baker Hughes International Financing S.à r.l.
|
Luxembourg
|
100%
|
Baker Hughes International Partners S.à r.l.
|
Luxembourg
|
100%
|
Baker Hughes International Holdings S.à r.l.
|
Luxembourg
|
(5)
|
BJS Holdings 2 S.à r.l.
|
Luxembourg
|
100%
|
Baker Hughes Holdings 4 S.à r.l.
|
Luxembourg
|
100%
|
Baker Hughes Holdings II B.V.
|
The Netherlands
|
100%
|
Baker Hughes Holdings 3 S.à r.l.
|
Luxembourg
|
100%
|
Baker Hughes Holdings 5 S.à r.l.
|
Luxembourg
|
100%
|
Baker Hughes International Coöperatief U.A.
|
The Netherlands
|
100%
|
Baker Hughes Holdings I B.V.
|
The Netherlands
|
100%
|
Baker Hughes Luxembourg Holdings S.C.A.
|
Luxembourg
|
(6)
|
BJ Services International S. à r.l.
|
Luxembourg
|
100%
|
Baker Hughes Nederland Holdings B.V.
|
The Netherlands
|
100%
|
Baker Hughes (Nederland) B.V.
|
The Netherlands
|
100%
|
Baker Hughes EHO Ltd.
|
Bermuda
|
100%
|
Baker Hughes Limited
|
United Kingdom
|
100%
|
(1)
|
Baker Hughes
Oilfield Operations, Inc.
|
|
|
|
|
Western Atlas Inc.
|
|
|
94.08%
|
|
Other subsidiaries
|
|
|
5.92%
|
(2)
|
Baker Hughes
International Branches, Inc.
|
|
|
|
|
Baker Hughes Oilfield Operations, Inc.
|
|
|
96.83%
|
|
Other subsidiaries
|
|
|
3.17%
|
(3)
|
Baker Hughes EHHC, Inc.
|
|
|
|
|
Baker Hughes International Branches, Inc.
|
|
|
99.63%
|
|
Other Subsidiaries
|
|
|
0.37%
|
(4)
|
Baker Hughes International Partners Holdings SCS
|
|
|
|
|
Baker Hughes EHHC, Inc.
|
|
|
84.13%
|
|
Other Subsidiaries
|
|
|
15.87%
|
(5)
|
Baker Hughes International Holdings S.à r.l.
|
|
|
|
|
Baker Hughes International Partners S.à r.l.
|
|
|
99.95%
|
|
Other Subsidiaries
|
|
|
0.05%
|
(6)
|
Baker Hughes Luxembourg Holdings S.C.A.
|
|
|
|
|
Baker Hughes Holdings I B.V.
|
|
|
37.70%
|
|
Other Subsidiaries
|
|
|
62.30%
|
•
|
Registration Statement No. 333-19771 on Form S-8
|
•
|
Registration Statement No. 333-103839 on Form S-8
|
•
|
Registration Statement No. 333-188789 on Form S-8
|
•
|
Registration Statement No. 333-195594 on Form S-8
|
•
|
Registration Statement No. 333-195595 on Form S-8
|
Date:
|
February 7, 2017
|
By:
|
|
/s/ Martin S. Craighead
|
|
|
|
|
Martin S. Craighead
Chairman and
Chief Executive Officer
|
Date:
|
February 7, 2017
|
By:
|
|
/s/ Kimberly A. Ross
|
|
|
|
|
Kimberly A. Ross
Senior Vice President
and Chief Financial Officer
|
(i)
|
The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and
|
(ii)
|
The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company as of the dates and for the periods expressed in the Report.
|
|
|
/s/ Martin S. Craighead
|
Name:
|
|
Martin S. Craighead
|
Title:
|
|
Chief Executive Officer
|
Date:
|
|
February 7, 2017
|
|
|
|
|
|
/s/ Kimberly A. Ross
|
Name:
|
|
Kimberly A. Ross
|
Title:
|
|
Chief Financial Officer
|
Date:
|
|
February 7, 2017
|
(1)
|
Amounts included are the total dollar value of proposed assessments received from MSHA on or before December 31, 2016 for citations and orders occurring during the year ended December 31, 2016, regardless of whether the assessment has been challenged or appealed. Citations and orders can be contested and appealed, and as part of that process, are sometimes reduced in severity and amount, and sometimes dismissed. The number of citations, orders, and proposed assessments vary by inspector and also vary depending on the size and type of the operation.
|