Baker Hughes 2015 Annual Report Download - page 26

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• lost sales and customers as a result of certain customers of either or both of the two companies deciding
not to do business with the combined company, or deciding to decrease their amount of business in order to
reduce their reliance on a single company;
• integrating personnel from the two companies while maintaining focus on providing consistent, high quality
products and services;
• potential unknown liabilities and unforeseen increased expenses, delays or regulatory conditions associated
with the Merger; and
• performance shortfalls at one or both of the two companies as a result of the diversion of management’s
attention caused by completing the Merger and integrating the companies’ operations.
ITEM 1B. UNRESOLVED STAFF COMMENTS
None.
ITEM 2. PROPERTIES
We own or lease numerous properties throughout the world. We consider our manufacturing plants, equipment
assembly, maintenance and overhaul facilities, grinding plants, drilling fluids and chemical processing centers, and
primary research and technology centers to be our principal properties. The following sets forth the location of our
principal owned or leased facilities for our oilfield operations:
North America: Houston, Pasadena, Tomball, and The Woodlands, Texas; Broken Arrow,
Claremore, Tulsa and Sand Springs, Oklahoma; Bossier City, Broussard, and
Lafayette, Louisiana - all located in the United States; Leduc, Canada
Europe/Africa/Russia Caspian: Aberdeen, Scotland; Liverpool, England; Celle, Germany; Tananger, Norway;
Port Harcourt, Nigeria; Luanda, Angola; Tyumen and Novosibirsk, Russia
Middle East/Asia Pacific: Dubai, United Arab Emirates; Dhahran, Saudi Arabia; Singapore, Singapore;
Chonburi, Thailand
Principal properties for the Industrial Services segment include locations in Pasadena, Texas; Sand Springs and
Barnsdall, Oklahoma; Taft, California; and Liverpool, England.
We own or lease numerous other facilities such as service centers, workshops and sales and administrative
offices throughout the geographic regions in which we operate. We also have a significant investment in service
vehicles, tools and manufacturing and other equipment. All of our owned properties are unencumbered. We
believe that our facilities are well maintained and suitable for their intended purposes.
ITEM 3. LEGAL PROCEEDINGS
We are subject to a number of lawsuits and claims arising out of the conduct of our business. The ability to
predict the ultimate outcome of such matters involves judgments, estimates and inherent uncertainties. We record
a liability for those contingencies where the incurrence of a loss is probable and the amount can be reasonably
estimated, including accruals for self-insured losses which are calculated based on historical claim data, specific
loss development factors and other information. A range of total possible losses for all litigation matters cannot be
reasonably estimated. Based on a consideration of all relevant facts and circumstances, we do not expect the
ultimate outcome of any currently pending lawsuits or claims against us will have a material adverse effect on our
financial position, results of operations or cash flows; however, there can be no assurance as to the ultimate
outcome of these matters.
We insure against risks arising from our business to the extent deemed prudent by our management and to the
extent insurance is available, but no assurance can be given that the nature and amount of that insurance will be
sufficient to fully indemnify us against liabilities arising out of pending or future legal proceedings or other claims.
Most of our insurance policies contain deductibles or self-insured retentions in amounts we deem prudent and for
which we are responsible for payment. In determining the amount of self-insurance, it is our policy to self-insure
those losses that are predictable, measurable and recurring in nature, such as claims for automobile liability,
general liability and workers compensation.