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| BHI > SEC Filings for BHI > Form 8-K on 19-Dec-2008 | All Recent SEC Filings |
19-Dec-2008
Change in Directors or Principal Officers
(e) On December 15, 2008, Baker Hughes Incorporated (the "Company") adopted the
following:
(i) an amendment and restatement of the employment agreement (the "Employment
Agreement") of Mr. Chad C. Deaton, the Company's President and Chief Executive
Officer, to comply with Section 409A of the Internal Revenue Code of 1986, as
amended (the "Code"), and final Department of Treasury regulations issued
thereunder (collectively, "Section 409A"). A secondary purpose of the amendment
to the Employment Agreement was to comply with a recent Internal Revenue Service
ruling dealing with performance-based compensation requirements under Section
162(m) of the Code, Revenue Ruling 2008-13, so as to preserve the Company's tax
deductions for bonuses awarded under the Baker Hughes Incorporated Annual
Incentive Compensation Plan for Mr. Deaton. The Employment Agreement provides
for a six month payment delay, interest paid during the six month payment delay
period, a separation from service payment event, a prorated bonus amount and a
cash severance payment to compensate for the loss of certain continued
retirement plan accruals.
(ii) amendments and restatements of the individual change in control
agreements between certain executives and the Company (the "Individual
Agreements") to comply with Section 409A. A secondary purpose of the amendments
to the Individual Agreements was to comply with a recent Internal Revenue
Service ruling dealing with performance-based compensation requirements under
Section 162(m) of the Code, Revenue Ruling 2008-13, so as to preserve the
Company's tax deductions for bonuses awarded under the ICP for Section 162(m)
"covered employees." The Individual Agreements provide for a six month payment
delay, interest paid during the six month payment delay period, funding of a
rabbi trust during the six month payment delay period, a separation from service
payment event, cash severance payments, pro-rata bonus payments and outplacement
services payment. Messrs. Deaton, Peter A. Ragauss, Alan R. Crain, David H. Barr
and Martin S. Craighead (collectively, the "Named Executive Officers") each has
an Individual Agreement.
(iii) an amendment and restatement of the Baker Hughes Incorporated Change in
Control Severance Plan (the "Plan") to comply with Section 409A. The Plan
includes a six month payment delay for Section 409A "specified employees",
interest paid during the six month payment delay period, funding of a Rabbi
Trust during the six month payment delay period, a separation from service
payment event and an outplacement services payment. The Named Executive Officers
are covered by the Plan.
(iv) an amendment to the indemnification agreements between officers and
directors and the Company (the "Indemnification Agreements") to comply with
Section 409A.
(v) an amendment to the Baker Hughes Incorporated Director Compensation
Deferral Plan (the "Director Plan") to conform the financial hardship,
disability and death distribution provisions with Section 409A. All of the
Company's independent non-management directors are eligible to participate in
the Director Plan.
(vi) an amendment to the Baker Hughes Incorporated Supplemental Retirement
Plan (the "SRP") to conform the financial hardship distribution provisions with
Section 409A. Each of the Named Executive Officers participates in the SRP.
(vii) an amendment to the Baker Hughes Incorporated Annual Incentive
Compensation Plan ("ICP") to comply with a recent Internal Revenue Service
ruling dealing with performance-based compensation requirements under Section
162(m) of the Code, Revenue Ruling 2008-13, so as to preserve the Company's
deductions for bonuses awarded under the ICP for Section 162(m) "covered
employees." The amendment pertains to bonuses in anticipation of a change in
control. Each of the Named Executive Officers participates in the ICP.
(viii) an amendment to the terms and conditions of the 2006 Performance Unit
Awards (the "2006 Terms and Conditions") to comply with Section 409A. The
amendment of the 2006 Terms and Conditions modifies the provisions relating to
payments in connection with a change of control. Each of the Named Executive
Officers has a 2006 Performance Unit Award.
(ix) an amendment to the terms and conditions of the 2007 Performance Unit
Awards (the "2007 Terms and Conditions") to comply with Section 409A. The
amendment of the 2007 terms and Conditions provides for a separation from
service payment event and payments in connection with a change of control. Each
of the Named Executive Officers has a 2007 Performance Unit Award.
The foregoing descriptions do not purport to be complete and are qualified in
their entirety by reference to the Employment Agreement, Individual Agreements,
the Plan, Indemnification Agreements, Director Plan, the SRP, the ICP and the
2006 and 2007 Terms and Conditions, which are each filed with this Form 8-K as
Exhibits 10.1 through 10.9 and incorporated into this Item 5.02 by reference.
Item 9.01 Financial Statements and Exhibits.
(c) Exhibits.
10.1 Amendment and Restatement of Employment Agreement between Chad C. Deaton
and Baker Hughes Incorporated dated as of January 1, 2009.
10.2 Form of Amended and Restated Change in Control Agreement effective as of
January 1, 2009.
10.3 Amendment and Restatement of the Baker Hughes Incorporated Change in
Control Severance Plan effective as of January 1, 2009.
10.4 Form of Amendment to the Indemnification Agreement effective as of
January 1, 2009.
10.5 Amendment to Baker Hughes Incorporated Director Compensation Deferral
Plan effective as of January 1, 2009.
10.6 Amendment to the Baker Hughes Incorporated Supplemental Retirement Plan
effective as of January 1, 2009.
10.7 Amendment to the Baker Hughes Incorporated Annual Incentive Compensation
Plan effective as of January 1, 2009.
10.8 Form of Amended Baker Hughes Incorporated 2006 Performance Unit Award
Terms and Conditions.
10.9 Form of Amended Baker Hughes Incorporated 2007 Performance Unit Award
Terms and Conditions.
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