Baker Hughes 2010 Annual Report Download - page 70

58 B a k e r H u g h e s I n c o r p o r a t e d
given effect unless the Company establishes to the Committee
by clear and convincing evidence that Cause exists. The Com-
mittee’s determination regarding the existence of Cause shall
be conclusive and binding upon all parties.
“Change in Control” means the occurrence of any of the
following events:
(a) the individuals who are Incumbent Directors cease for any
reason to constitute a majority of the members of the Board;
(b) the consummation of a Merger of Baker Hughes or an
Affiliate with another Entity, unless the individuals and
Entities who were the Beneficial Owners of the Voting
Securities of Baker Hughes outstanding immediately prior
to such Merger own, directly or indirectly, at least 50 per-
cent of the combined voting power of the Voting Securi-
ties of any of Baker Hughes, the surviving Entity or the
parent of the surviving Entity outstanding immediately
after such Merger;
(c) any Person, other than a Specified Owner, becomes a
Beneficial Owner, directly or indirectly, of securities of
Baker Hughes representing 30 percent or more of the
combined voting power of Baker Hughes’ then outstand-
ing Voting Securities;
(d) a sale, transfer, lease or other disposition of all or sub-
stantially all of Baker Hughes’ Assets is consummated
(an “Asset Sale”), unless:
(1) the individuals and Entities who were the Beneficial
Owners of the Voting Securities of Baker Hughes
immediately prior to such Asset Sale own, directly
or indirectly, 50 percent or more of the combined
voting power of the Voting Securities of the Entity that
acquires such Assets in such Asset Sale or its parent
immediately after such Asset Sale in substantially the
same proportions as their ownership of Baker Hughes’
Voting Securities immediately prior to such Asset
Sale; or
(2) the individuals who comprise the Board immediately
prior to such Asset Sale constitute a majority of the
board of directors or other governing body of either
the Entity that acquired such Assets in such Asset Sale
or its parent (or a majority plus one member where
such board or other governing body is comprised of
an odd number of directors); or
(e) The stockholders of Baker Hughes approve a plan of
complete liquidation or dissolution of Baker Hughes.
“CIC Committee” means (i) the individuals (not fewer
than three in number) who, on the date six months before a
Change in Control or a Potential Change in Control, constitute
the Committee, plus (ii) in the event that fewer than three
individuals are available from the group specified in clause
(i) above for any reason, such individuals as may be appointed
by the individual or individuals so available (including for this
purpose any individual or individuals previously so appointed
under this clause (ii)); provided, however, that the maximum
number of individuals constituting the CIC Committee shall
not exceed six.
“Code” means the Internal Revenue Code of 1986, as
amended from time to time.
“Committee” means the Compensation Committee of
the Board.
“Company” means Baker Hughes and any Affiliate that
adopts the Plan pursuant to the provisions of Article XII.
“Continuous Service” means a Participant’s service for
the Company and Affiliates commencing on his most recent
date of hire by the Company or an Affiliate and ending on the
date of the complete severance of the Participant’s employ-
ment relationship with the Company or an Affiliate without a
contemporaneous transfer to the employ of the Company or
any Affiliate. For this purpose, a Participant will not be treated
as having a new date of hire if he is directly transferred from
the employ of the Company or an Affiliate to the employ of
an Affiliate or the Company.
“Covered Employee” has the meaning ascribed to that
term in Section 162(m).
“Disability” means the inability of a Participant 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. The Plan
Administrator’s determination regarding the existence of
Disability shall be conclusive and binding upon all parties.
“Domestic Relations Order” has the meaning ascribed
to that term in section 414(p) of the Code.
“Entity” means any corporation, partnership, association,
joint-stock company, limited liability company, trust, unincor-
porated organization or other business entity.
“Exchange Act” means the Securities Exchange Act of
1934, as amended from time to time, or any successor act.
“Final Award” means the actual award that may be
paid for a Plan Year to a Participant, if it is not forfeited
pursuant to Article VIII, as determined by the Committee.
“Good Reason” for termination by the Participant of his
employment means the occurrence (without the Participant’s
express written consent) after any Change in Control, or prior
to a Change in Control under the circumstances described in
clauses (ii) and (iii) of Section 10.04 (treating all references to
“Change in Control” in paragraphs (a) through (f) below as
references to a “Potential Change in Control”), of any one of
the following acts by the Company, or failures by the Com-
pany to act, unless, in the case of any act or failure to act
described in paragraph (a), (e), (f) or (g) below, such act or
failure to act is corrected prior to the effective date of the
Participant’s termination for Good Reason:
(a) the assignment to the Participant of any duties or respon-
sibilities which are substantially diminished as compared
to the Participant’s duties and responsibilities immediately
prior to the Change in Control;
(b) a reduction by the Company in the Participant’s annual base
salary as in effect on the date hereof or as the same may
be increased from time to time, except for across-the-board