Baker Hughes 2007 Annual Report Download - page 54

36 Baker Hughes Incorporated
Alan R. Crain
If the target level of performance were achieved during
the performance period, we would owe Mr. Crain 5,000
shares, with a value as of December 31, 2007 of $405,500
(5,000 shares multiplied by $81.10 per share value on Decem-
ber 31, 2007). If the highest level of performance were
achieved during the performance period, we would owe
Mr. Crain 10,000 shares with a value as of December 31,
2007 of $811,000.
David H. Barr
If the target level of performance were achieved during
the performance period, we would owe Mr. Barr 3,250 shares
with a value as of December 31, 2007 of $263,575 (3,250
shares multiplied by $81.10 per share value on December 31,
2007). If the highest level of performance were achieved dur-
ing the performance period, we would owe Mr. Barr 6,500
shares with a value as of December 31, 2007 of $527,150.
Pro Rata Payment of Performance Awards Upon the
NEO’s Termination of Employment Due to His Disability
or His Death
If the NEO had terminated employment with us on Decem-
ber 31, 2007 due to disability or death, at the end of the
applicable performance period we would have owed the NEO
an amount based upon the actual performance objectives
achieved during the performance period. The amount payable
under the performance award would be the amount of our
shares that we would have paid under the award had the NEO
remained employed by us through the end of the performance
period. For this purpose a NEO is treated as having incurred a
disability if he qualifies for long-term disability benefits under
our long-term disability program.
If on December 31, 2007, the NEO terminated employ-
ment with us due to his death or disability, we would have
paid the NEO the amount specified above under the heading
“Payment of Performance Awards Upon Termination of
Employment in Connection With the Sale of a Business Unit.”
Performance Unit Awards
Pro Rata Payment of Performance Unit Awards Upon
a Change in Control
If a 2002 Change in Control were to have occurred on
December 31, 2007, prior to the NEO’s termination of employ-
ment with us, we, or our successor, would have paid the NEO,
in cash, an amount equal to $100 multiplied by the number
of performance units specified in the NEO’s performance unit
award agreement, multiplied by the number of days during
the performance period through December 31, 2007 (365,
divided by 1095). The amounts we or our successor would
have paid are $2,540,854, $816,564, $1,045,929, $574,931
and $455,096 for Messrs. Deaton, Ragauss, Clark, Crain and
Barr, respectively.
Pro Rata Payment of Performance Unit Awards
Upon Termination of Employment by the NEO for
Good Reason or By Us Without Cause in Connection
with a Potential Change in Control
If on December 31, 2007, (i) we terminated the employ-
ment of a NEO without cause (within the meaning of the
2002 D&O Plan) prior to a 2002 D&O Plan Change in Control,
or (ii) the NEO terminated his employment with us for good
reason (within the meaning of the 2002 D&O Plan) and, in the
case of (i) or (ii), the circumstance or event occurred at the
request or direction of the person who entered into an agree-
ment with us the consummation of which would constitute
such a change in control or is otherwise in connection with or
in anticipation of such a change in control, we would have
paid the NEO, in cash, an amount equal to $100 multiplied by
the number of performance units specified in the NEO’s per-
formance unit award agreement, multiplied by the number of
days during the performance period through December 31,
2007 divided by 1095.
The amounts we would have paid the NEOs are specified
above under the heading “Pro Rata Payment of Performance
Unit Awards Upon a Change in Control.”
Pro Rata Payment of Performance Unit Awards
Upon the NEO’s Termination of Employment Due
to His Disability or His Death
If the NEO had terminated employment with us on Decem-
ber 31, 2007 due to disability or death we would have paid
him in a single sum in cash an amount equal to $100 multi-
plied by the number of performance units specified in the
NEO’s performance unit award agreement, multiplied by the
number of days during the performance period through
December 31, 2007, divided by 1095.
The NEO is treated as having incurred a disability for this
purpose if he (i) is 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 or (ii) is by reason of any medically determin-
able 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, receiving income replace-
ment benefits for a period of not less than three months
under our accident and health plan.
If the NEO had terminated employment with us on Decem-
ber 31, 2007 due to disability or death we would have paid
him in a single sum in cash the amount specified above under
the heading “Pro Rata Payment of Performance Unit Awards
Upon a Change in Control.”
Pro Rata Payment of Performance Unit Awards Upon the
NEO’s Termination of Employment Due to His Retirement
If the NEO had terminated employment with us on Decem-
ber 31, 2007 due to his retirement, we would have paid in a
single sum in cash an amount equal to $100 multiplied by the