CONSULTING AGREEMENT
BETWEEN BAKER HUGHES INCORPORATED AND
DAVID H. BARR
This Consulting
Agreement (hereinafter “Agreement”) is made as of the
30th day of April, 2009, by and between Baker Hughes Oilfield
Operations, Inc. , a California corporation (hereinafter
“Company”), having a mailing address of 2929 Allen
Parkway, Suite 2100, Houston, Texas, 77019 (hereinafter
“Company”), and David H. Barr, an individual
having a mailing address of 35 Southgate, The Woodlands, Texas
77380 (hereinafter “Consultant”).
WHEREAS,
Consultant possesses certain knowledge, experience and goodwill in
the field of management and business development; and
WHEREAS, the
Company is desirous of utilizing Consultant’s general
expertise and Consultant is willing to assist the Company with
certain tasks from time to time;
NOW, THEREFORE, in
consideration of the premises and the mutual convenience and
conditions contained herein, the parties agree as
follows:
1.
Services: Consultant will
render consulting services to the Company as listed in
Schedule A and will employ its best efforts in this area on
behalf of the Company and persons affiliated with the Company, all
as may be requested from time to time by any authorized
representative of the Company. All services and work shall be
performed by Consultant in compliance with all applicable laws,
rules and regulations. Consultant shall have exclusive direction
and control over the manner and method of carrying out the tasks
for accomplishing the services to be provided by Consultant under
this Agreement. It is intended that the consulting services
Consultant will perform under this Agreement will not be at a level
that exceeds 20 percent of the average level of services
Consultant performed for the Company over the 36-month period
immediately preceding May 1, 2009.
2. Term of
Agreement: May 1,
2009 to October 31, 2010.
3.
Independent Contractor or Consultant: It is the intention of the parties and
Consultant agrees he is an independent contractor, and while
providing services under this Agreement, is not an agent or
employee, joint venture or partner of the Company, and has no
authority to obligate or bind the Company in any way to third
parties without the express written permission of an appropriate
officer of the Company. Nothing in this Agreement shall render
Consultant an employee or agent of the Company, nor authorize or
empower Consultant to speak for, represent, or obligate the Company
in any way. Consultant shall indemnify, defend and hold the Company
harmless from any injury or damage sustained by the Company as a
result of any commitment made by Consultant on behalf of the
Company without the Company’s express written
authorization.
4. Method of
Performing Services: Consultant will determine the method, details,
and means of performing the work to be carried out for Company.
Company shall have no right to, and shall not control the manner or
determine the method of accomplishing such work. Company, however,
requires Consultant at all times to observe security and safety
policies of Company. Consultant warrants that the services
performed hereunder will be performed using the standards,
practices, methods and procedures and exercising that degree of
skill, care and diligence, prudence and foresight which would
reasonably and ordinarily be expected from a skilled and
experienced person engaged in a similar type of undertaking under
the same or similar circumstances.
5.
Non-Exclusive Services: Subject to the provisions of this Agreement
(including the non-competition provisions of Section 13),
during the term of this Agreement, Consultant may represent,
perform services for, or be retained by such additional persons or
entities as Consultant deems appropriate; provided however, that
none of such activities shall interfere with Consultant’s
ability to perform its obligations under this Agreement, or
adversely affect the business, operations or financial condition of
the Company or its affiliates.
6.
Benefits: In connection
with his services hereunder , Consultant shall not be
eligible for or claim any benefits or perquisites which the Company
provides to its employees including, but not limited to, medical,
dental and life insurance coverage, bonuses, paid time off, or
stock purchase plan, pension plan or thrift plan coverage. Nothing
in this Section 6 shall affect or apply to any benefits which
Consultant has already accrued through the date of his
retirement.
7.
Conduct: Consultant shall
conduct work in accordance with Company policies including but not
limited to the Business Code of Conduct, Equal Employment
Opportunity & Anti-Harassment, Electronic Communications and
Global Expense Reporting. Copies of these policies are available
on-line or upon request.
8.
Fees: In consideration
for the rendering of Consultant’s services, the Company will
pay Consultant a fee as agreed in Schedule A.
Consultant’s consulting fees earned during the six-month
period commencing on the date of Consultant’s separation from
service will be accumulated and paid to Consultant on the date that
is six months following the date of Consultant’s separation
from service together with interest on such accumulated amounts
calculated using an interest rate equal to the six month Interbank
Offered Rate in effect on the date of Consultant’s separation
from service plus two percentage points. Thereafter, subject to the
following provisions of this Section 8, Consultant’s
consulting fees earned during the remainder of the consulting
period will be paid on a monthly basis. For purposes of this
Agreement the term “separation from service” has the
meaning ascribed to that term in Section 409A of the Internal
Revenue Code of 1986, as amended. In the event of the death of
Consultant during the term of this Agreement, Company shall pay to
the estate or personal representative of Consultant, any monthly
fees reflected on Schedule A for the remainder of the term of
this Agreement that have not yet been paid. Such payment shall be
made in a single sum in cash on the date that is 30 days
following the date of Consultant’s death. In the event of the
occurrence of a Change in Control (as defined below) during the
term of this Agreement that constitutes a change in control event
within the meaning of Department of Treasury
Regulation Section 1.409A-3(i)(5), Company shall pay to
Consultant any monthly fees reflected on Schedule A for the
remainder of the term of this Agreement that have not yet been
paid. Such payment shall be made in a single sum in cash on
the
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earlier of
(i) the date of the Change in Control or (ii) the date
that is six months following the date of Consultant’s
Separation from Service. For purposes of this Agreement, the term
“Change in Control” has the meaning ascribed to that
term in the Baker Hughes Incorporated 2002 Director and Officer
Long-Term Incentive Plan in effect for awards granted after
July 24, 2008. No accelerated payment in the event of a
qualifying Change in Control shall relieve Consultant of his
obligations under this Agreement, including, but not limited to
Consultant’s obligation to personally perform all services
hereunder for the remainder of the term of this Agreement. In the
event Consultant becomes Disabled (as defined below) during the
term of this Agreement, Company shall pay to Consultant any monthly
fees reflected on Schedule A for the remainder of the term of
this Agreement that have not yet been paid. Such payment shall be
made in a single sum in cash on the earlier of (i) the date
Consultant becomes Disabled or (ii) the date that is six
months following the date of Consultant’s Separation from
Service. For purposes of this Agreement, the term
“Disabled” has the meaning ascribed to that term in
section 409A(a)(2)(C) of the Internal Revenue Code of 1986, as
amended. There shall be no duplication of payment of consulting
fees under this Agreement; accordingly, upon the accelerated
payment of consulting fees in the event of Consultant’s death
or Disability or the occurrence of a Change in Control no further
consulting fees shall be payable under this Agreement.
9.
Expenses: Except as
otherwise agreed in this Agreement Consultant shall be responsible
for all costs including transportation and personal incidentals and
expenses incident to the performance of services for Company,
including all costs incurred by Consultant to do business. Company
will reimburse Consultant only for transportation, personal and
miscellaneous business expenses incurred in rendering services
hereunder as a result of a prior express written request by an
authorized representative of Company and incurred in accordance
with the then current Baker Hughes Incorporated expense
reimbursement policies. Expenses will be reimbursed in a timely
manner upon presentation by Consultant to Company of properly
completed expense reports with all supporting receipts.
10. Payment
of Taxes by Consultant: Consultant shall pay to the appropriate taxing
authorities federal, state and local income taxes, social security
taxes, and unemployment insurance taxes applicable to Consultant.
Consultant shall defend, indemnify and hold harmless Company,
Company’s officers, directors, employees and agents, from and
against any claims, liabilities or expenses relating to
Consultant’s taxes attributable to Consultant’s
compensation under this Agreement.
11. State
and Federal Taxes: As
Consultant is not a Company employee, Company shall not take any
action or provide Consultant with any benefits or commitments
inconsistent with the classification of Consultant as an
independent contractor. In particular: (1) Company will not
withhold FICA (Social Security) from Consultant’s payments;
(2) Company will not make state or federal insurance
contributions on behalf of Consultant; (3) Company will not
withhold state and federal income taxes from payments to
Consultant; (4) Company will not make disability insurance
contributions on behalf of Consultant; and (5) Company will
not obtain workers’ compensation insurance on behalf of
Consultant.
12.
Confidential Information: Consultant recognizes and acknowledges it will
have access to certain confidential information (written or
otherwise) of the Company (“Confidential
3
Information”), and that such information
constitutes valuable, special and unique property of the Company.
Consultant further acknowledges that Consultant’s work
hereunder will involve proprietary and confidential information,
and thus also will be subject to the terms of this Section 13.
Consultant will not, during or after the term of this Agreement,
use for the benefit of himself or any other or disclose any of such
confidential information to any person or firm, corporation,
association or other entity for any reason or purpose whatsoever
(except to authorized representatives of the Company) without the
express written permission of an authorized representative of the
Company. Upon completion of services under and upon termination of
this Agreement for any reason, C
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