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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549

SCHEDULE 14A

Proxy Statement Pursuant to Section 14(a) of
the Securities Exchange Act of 1934 (Amendment No.          )

 

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January 2010

To our Stockholders:

        I am pleased to invite you to attend the annual meeting of stockholders of Agilent Technologies, Inc. ("Agilent") to be held on Tuesday, March 2, 2010 at 10:00 a.m., Pacific Standard Time, at the South San Francisco Conference Center located at 255 South Airport Boulevard, South San Francisco, California (U.S.A.). Details regarding admission to the annual meeting and the business to be conducted are more fully described in the accompanying Notice of Annual Meeting and Proxy Statement.

        If you are unable to attend the annual meeting in person, you may participate through the Internet or by telephone. To participate in the live webcast, log on at www.investor.agilent.com and select the link for the webcast. To listen by telephone, please call (800) 510 0219 (international callers should dial (617) 614 3451). The meeting pass code is 35104330. The webcast will begin at 10:00 a.m. and will remain on Agilent's website for one year. You cannot record your vote on this website or at this phone number.

        We have elected to take advantage of Securities and Exchange Commission rules that allow issuers to furnish proxy materials to their stockholders on the Internet. We believe that the rules will allow us to provide our stockholders with the information they need, while lowering the costs of delivery and reducing the environmental impact of the annual meeting.

        Your vote is important. Whether or not you plan to attend the annual meeting, I hope that you will vote as soon as possible. Please review the instructions on each of your voting options described in the Proxy Statement and the Notice of Internet Availability of Proxy Materials you received in the mail.

        Thank you for your ongoing support of, and continued interest in, Agilent.

Sincerely,

        Admission to the annual meeting will be limited to stockholders. Please note that an admission ticket and picture identification will be required to enter the annual meeting. Each stockholder will be entitled to bring a guest to the annual meeting. For stockholders of record, an admission ticket is printed on the back cover of these proxy materials. The Notice of Internet Availability of Proxy Materials will also serve as an admission ticket. An individual arriving without an admission ticket will not be admitted unless it can be verified that the individual was an Agilent stockholder as of the record date. Backpacks, cameras, cell phones with cameras, recording equipment and other electronic recording devices will not be permitted at the annual meeting. Agilent reserves the right to inspect any persons or items prior to their admission to the annual meeting. Failure to follow the meeting rules or permit inspection will be grounds for exclusion from the annual meeting.

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2010 ANNUAL MEETING OF STOCKHOLDERS
NOTICE OF ANNUAL MEETING AND PROXY STATEMENT
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AGILENT TECHNOLOGIES, INC.

5301 Stevens Creek Blvd.
Santa Clara, California 95051
(408) 553-2424

Notice of Annual Meeting of Stockholders

This Proxy Statement and the accompanying proxy card are being sent or made available
on or about January 19, 2010.

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QUESTIONS AND ANSWERS ABOUT THE PROXY MATERIALS
AND THE ANNUAL MEETING

Q:    Why did I receive a one-page notice in the mail regarding the Internet availability of proxy materials instead of a full set of proxy materials?

A:

In accordance with rules and regulations adopted by the Securities and Exchange Commission (the "SEC"), instead of mailing a printed copy of our proxy materials to each stockholder of record, we are furnishing proxy materials, including this Proxy Statement and the Agilent Technologies, Inc. ("Agilent" or the "Company") 2009 Annual Report to Stockholders, by providing access to such documents on the Internet. Most stockholders will not receive printed copies of the proxy materials unless they request them. Instead, commencing on or about January 19, 2010, a Notice of Internet Availability of Proxy Materials (the "Notice") was sent to most of our stockholders which will instruct you as to how you may access and review all of the proxy materials on the Internet. The Notice also instructs you as to how you may submit your proxy on the Internet. If you would like to receive a paper or email copy of our proxy materials, you should follow the instructions for requesting such materials in the Notice.

Q:    Why am I receiving these materials?

A:

Agilent's Board of Directors (the "Board") is providing these proxy materials to you on the Internet or, upon your request, has delivered printed versions of these materials to you by mail, in connection with Agilent's annual meeting of stockholders, which will take place on March 2, 2010. Stockholders are invited to attend the annual meeting and are requested to vote on the proposals described in this Proxy Statement.

Q:    What is included in these materials?

A:

These materials include:

•

our Proxy Statement for Agilent's annual meeting; and

•

our 2009 Annual Report to Stockholders, which includes our audited consolidated financial statements.

If you requested printed versions of these materials by mail, these materials also include the proxy card for the annual meeting.

Q:    What information is contained in these materials?

A:

The information included in this Proxy Statement relates to the proposals to be voted on at the annual meeting, the voting process, the compensation of directors and our most highly paid officers and certain other required information.

Q:    What proposals will be voted on at the annual meeting?

A:

There are three proposals scheduled to be voted on at the annual meeting:

•

the election of two directors for a 3-year term;

•

the ratification of the Audit and Finance Committee's appointment of PricewaterhouseCoopers LLP as Agilent's independent registered public accounting firm; and

•

the approval of Agilent's Performance-Based Compensation Plan for Covered Employees.

Q:    What is the Agilent Board's voting recommendation?

A:

Agilent's Board recommends that you vote your shares "FOR" each of the

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nominees to the Board, "FOR" the ratification of the Audit and Finance Committee's appointment of PricewaterhouseCoopers LLP as Agilent's independent registered public accounting firm, and "FOR" the approval of Agilent's Performance-Based Compensation Plan for Covered Employees.

Q:    What shares owned by me can be voted?

A:

All shares owned by you as of the close of business on January 6, 2010 (the "Record Date") may be voted. You may cast one vote per share of common stock that you held on the Record Date. These shares include shares that are: (1) held directly in your name as the stockholder of record, including shares purchased through the Agilent Technologies, Inc. 1999 Stock Plan and 2009 Stock Plan and the Agilent Technologies, Inc. Employee Stock Purchase Plan, and (2) held for you as the beneficial owner through a stockbroker, bank or other nominee or held for your account by the Agilent Technologies, Inc. 401(k) Plan or Deferred Compensation Plans.

Q:    What is the difference between holding shares as a stockholder of record and as a beneficial owner?

A:

Most stockholders of Agilent hold their shares through a stockbroker, bank or other nominee rather than directly in their own name. As summarized below, there are some differences between shares held of record and those owned beneficially.

Stockholder of Record

If your shares are registered directly in your name with Agilent's transfer agent, Computershare Investor Services, you are considered, with respect to those shares, the stockholder of record, and the Notice, or if requested, these proxy materials are being sent directly to you. As the stockholder of record, you have the right to grant your voting proxy directly to the persons named as proxy holders, William P. Sullivan, Agilent's President and Chief Executive Officer, and Marie Oh Huber, Agilent's Senior Vice President, General Counsel and Secretary, or to vote in person at the annual meeting. If you requested printed copies of the proxy materials, Agilent has enclosed a proxy card for you to use. You may also vote on the Internet or by telephone, as described below under the heading "How can I vote my shares without attending the annual meeting?"

Beneficial Owner

If your shares are held in a stock brokerage account or by a bank or other nominee, you are considered the beneficial owner of shares held in "street name", and these proxy materials are being forwarded to you by your broker or nominee who is considered, with respect to those shares, the stockholder of record. As the beneficial owner, you have the right to direct your broker on how to vote and are also invited to attend the annual meeting. However, since you are not the stockholder of record, you may not vote these shares in person at the annual meeting. Your broker or nominee has enclosed a voting instruction card for you to use in directing your broker or nominee as to how to vote your shares. You may also vote by Internet or by telephone, as described below under "How can I vote my shares without attending the annual meeting?"

Q:    How can I vote my shares in person at the annual meeting?

A:

Shares held directly in your name as the stockholder of record may be voted in person at the annual meeting. If you choose to vote your shares in person at the annual meeting, please bring your admission ticket or the enclosed proxy card and proof of identification. Even if you plan to attend the annual meeting, Agilent recommends that you vote your shares in advance as described below so

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that your vote will be counted if you later decide not to attend the annual meeting.

Shares held in "street name" may be voted in person by you only if you obtain a signed proxy from the record holder giving you the right to vote the shares.

Q:    How can I vote my shares without attending the annual meeting?

A:

Whether you hold your shares directly as the stockholder of record or beneficially in "street name", you may direct your vote without attending the annual meeting by proxy. You can vote by proxy over the Internet or by telephone. Please follow the instructions provided in the Notice, or, if you request printed copies of proxy materials, on the proxy card or voting instruction card you receive.

Q:    Can I revoke my proxy or change my vote?

A:

You may revoke your proxy or change your voting instructions at any time prior to the vote at the annual meeting. You may enter a new vote by using the Internet or the telephone or by mailing a new proxy card or new voting instruction card bearing a later date (which will automatically revoke your earlier voting instructions) or by attending the annual meeting and voting in person. Your attendance at the annual meeting in person will not cause your previously granted proxy to be revoked unless you specifically so request.

Q:    How are votes counted?

A:

In the election of directors, your vote may be cast "FOR" or "AGAINST" one or more of the nominees, or you may "ABSTAIN" from voting with respect to one or more of the nominees. Shares voting "ABSTAIN" have no effect on the election of directors.

For the other proposals, your vote may be cast "FOR" or, "AGAINST" or you may "ABSTAIN." If you "ABSTAIN", it has the same effect as a vote "AGAINST." If you sign your proxy card or broker voting instruction card with no further instructions, your shares will be voted in accordance with the recommendations of the Board. Any undirected shares that you hold in Agilent's 401(k) Plan will be voted in proportion to the way the other 401(k) Plan stockholders vote their 401(k) Plan shares.

Abstentions

If you specify that you wish to "abstain" from voting on an item, your shares will not be voted on that particular item. Abstentions are counted toward establishing a quorum and included in the shares entitled to vote on the ratification of the Audit and Finance Committee's appointment of PricewaterhouseCoopers LLP as Agilent's independent registered public accounting firm, and the approval of Agilent's Performance-Based Compensation Plan for Covered Employees and therefore have the effect of a vote against the proposals.

Broker Non-Votes

Under the New York Stock Exchange ("NYSE") rules, if your broker holds your shares in its name and does not receive voting instructions from you, your broker has discretion to vote these shares on certain "routine" matters, including the ratification of the Audit and Finance Committee's appointment of PricewaterhouseCoopers LLP as Agilent's independent registered public accounting firm. However, on non-routine matters such as the election of directors and the approval of Agilent's Performance-Based Compensation Plan, your broker must receive voting instructions from you, as it does not have discretionary voting power for these particular items. So long as the broker has discretion to vote on at least one proposal, these "broker non-votes" are counted toward establishing a quorum. When voted on "routine"

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matters, broker non-votes are counted toward determining the outcome of that "routine" matter.

Q:    What is the voting requirement to approve each of the proposals?

A:

In the election for directors, each nominee for director shall be elected if he receives the majority of the votes cast with respect to that director. A "majority of the votes cast" shall mean that the number of shares voted "FOR" a director must exceed 50% of the votes cast with respect to that director. The "votes cast" shall include votes to withhold authority and exclude votes to "ABSTAIN" with respect to that director's election. The affirmative vote of a majority of those shares present and entitled to vote is required to approve (i) the ratification of the Audit and Finance Committee's appointment of PricewaterhouseCoopers LLP as our independent registered public accounting firm, and (ii) Agilent's Performance-Based Compensation Plan for Covered Employees. If you are a beneficial owner of Agilent shares and do not provide the stockholder of record with voting instructions, your beneficially owned shares may constitute broker non-votes, as described in "What is the quorum requirement for the annual meeting?" in the section entitled "Additional Questions and Information Regarding the Annual Meeting and Stockholder Proposals" located at the end of this Proxy Statement. In tabulating the voting result for any particular proposal, shares that constitute broker non-votes are not considered entitled to vote.

Q:    What does it mean if I receive more than one Notice, proxy or voting instruction card?

A:

It means your shares are registered differently or are in more than one account. For all Notices you receive, please enter your vote by Internet for each control number you have been assigned. If you received paper copies of proxy materials, please provide voting instructions for all proxy and voting instruction cards you receive.

Q:    How can I obtain an admission ticket for the annual meeting?

A:

An admission ticket is printed on the back cover of these proxy materials or you may use the Notice for admission to the Annual Meeting.

Q:    Where can I find the voting results of the annual meeting?

A:

Agilent will announce preliminary voting results at the annual meeting and publish preliminary, or final results if available, in a Current Report on Form 8-K within four business days of the annual meeting.

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BOARD STRUCTURE AND COMPENSATION

        The Board is divided into three classes serving staggered three-year terms. The Board has nine directors and the following four committees: (1) Audit and Finance, (2) Compensation, (3) Nominating/Corporate Governance and (4) Executive. The number of Directors is currently fixed at nine. On November 18, 2009, Robert L. Joss gave written notice to Agilent that, effective March 2, 2010, immediately before the annual meeting of stockholders of the Company, he will resign as a member of the Board of Directors of Agilent. Pursuant to resolutions passed by the Board, effective immediately after the time of the annual meeting the authorized number of directors will be reduced to eight.

        The fiscal year for the Board begins March 1 of each year. The membership during the 2009 Agilent fiscal year and the function of each committee is described below. During the 2009 Agilent fiscal year, the Board held eight meetings. The Audit and Finance, Nominating/Corporate Governance, Compensation and Executive Committees held thirteen, two, five and one meeting(s), respectively. Each director attended at least 75% of the aggregate number of Board and applicable committee meetings held when the director was serving on the Board.

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X = Committee member; * = Chairperson

(1)

Mr. Clark has served as a director since May 2006.

(2)

Mr. Cullen has served as a director since April 2000 and as the Non-Executive Chairman of the Board since March 1, 2005.

(3)

Mr. Herbold has served as a director since June 2000.

(4)

Mr. Joss has served as a director since July 2003.

(5)

Mr. Koh has served as a director since May 2003.

(6)

Ms. Fields has served as a director since February 2000.

(7)

Dr. Lawrence has served as a director since July 1999.

(8)

Mr. Rand has served as a director since November 2000.

(9)

Mr. Sullivan has served as a director since March 1, 2005.

        Agilent encourages, but does not require, its Board members to attend the annual stockholders meeting. Last year, two of our directors attended the annual stockholders meeting.

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Audit and Finance Committee

        The Audit and Finance Committee is responsible for the oversight of the quality and integrity of Agilent's consolidated financial statements, its compliance with legal and regulatory requirements, the qualifications and independence of its independent registered public accounting firm, the performance of its internal audit function and independent registered public accounting firm and other significant financial matters. In discharging its duties, the Audit and Finance Committee is expected to:

•

have the sole authority to appoint, retain, compensate, oversee, evaluate and replace the independent registered public accounting firm;



•

review and approve the scope of the annual internal and external audit;



•

review and pre-approve the engagement of Agilent's independent registered public accounting firm to perform audit and non-audit services and the related fees;



•

meet independently with Agilent's internal auditing staff, independent registered public accounting firm and senior management;



•

review the adequacy and effectiveness of the system of internal control over financial reporting and any significant changes in internal control over financial reporting;



•

review Agilent's consolidated financial statements and disclosures including "Management's Discussion and Analysis of Financial Condition and Results of Operations" in the Company's reports on Form 10-K or Form 10-Q;



•

establish and oversee procedures for (a) the receipt, retention and treatment of complaints received by the Company regarding accounting, internal accounting controls or auditing matters, and (b) the confidential anonymous submission by employees of the Company of concerns regarding questionable accounting or auditing matters;



•

review funding and investment policies, implementation of funding policies and investment performance of Agilent's benefit plans;



•

monitor compliance with Agilent's Standards of Business Conduct; and



•

review disclosures from Agilent's independent registered public accounting firm required by the applicable requirements of the Public Company Accounting Oversight Board regarding the independence of accountant's communications with the audit committee of the concerning independence.

Compensation Committee

        The Compensation Committee reviews the performance of Agilent's elected officers and other key employees and determines, approves and reports to the Board on the elements of their compensation, including total cash compensation and long-term equity based incentives. In addition, the Compensation Committee:

•

approves and monitors Agilent's benefit plan offerings;



•

supervises and oversees the administration of Agilent's incentive compensation, variable pay and stock programs;



•

recommends to the Board the annual retainer fee as well as other compensation for non-employee directors;



•

establishes comparator peer group and compensation targets based on this peer group for the Company's named executive officers; and

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has sole authority to retain and terminate executive compensation consultants.

        For more information on the responsibilities and activities of the Compensation Committee, including the committee's processes for determining executive compensation, see "Compensation Discussion and Analysis," "Compensation Committee Report," "Executive Compensation" and the Compensation Committee's charter.

        The Compensation Committee also helps determine compensation for non-employee directors. The process the Compensation Committee undertakes for setting non-employee director compensation is similar to that of setting executive officer compensation. The Compensation Committee is aided by an independent consultant, currently F. W. Cook & Co., Inc., who is selected and retained by the Compensation Committee. The role of the independent consultant is to measure and benchmark our non-employee director compensation against a certain peer group of companies with respect to appropriate compensation levels for positions comparable in the market. The independent consultant recommends appropriate retainers, committee chair retainers, grant values and stock ownership guidelines to the Compensation Committee. This information is reviewed, discussed and finalized at a Compensation Committee meeting and a recommendation is made to the full Board. The full Board makes the final determination on non-employee director compensation.

Nominating/Corporate Governance Committee

        The Nominating/Corporate Governance Committee proposes a slate of directors for election by Agilent's stockholders at each annual meeting and appoints candidates to fill any vacancies on the Board. It is also responsible for reviewing management succession plans, determining the appropriate Board size and committee structure and developing and reviewing corporate governance principles applicable to Agilent.

        The Nominating/Corporate Governance Committee will consider candidates recommended for nomination by stockholders, provided that the recommendations are made in accordance with the procedures described in the section entitled "Additional Questions and Information Regarding the Annual Meeting and Stockholder Proposals" located at the end of this Proxy Statement. Candidates recommended for nomination by stockholders that comply with these procedures will receive the same consideration as other candidates recommended by the Nominating/Corporate Governance Committee.

        Agilent hires a third party search firm to help identify and facilitate the screening and interview process of candidates for director. To be considered by the Nominating/Corporate Governance Committee, a director nominee must have:

•

experience as a Board member or senior officer of a Fortune 200 or equivalent company or have achieved national prominence in an academic, government or other relevant field;



•

breadth of experience;



•

soundness of judgment;



•

the ability to make independent, analytical inquiries;



•

the willingness and ability to devote the time required to perform Board activities adequately; and



•

the ability to represent the total corporate interests of Agilent.

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        In addition to these minimum requirements, the Nominating/Corporate Governance Committee will also evaluate whether the candidate's skills are complementary to the existing Board members' skills and the Board's needs for operational, management, financial, international, technological or other expertise. The search firm screens the candidates, does reference checks, prepares a biography for each candidate for the Nominating/Corporate Governance Committee to review and helps set up interviews. The Nominating/Corporate Governance Committee and Agilent's Chief Executive Officer interview candidates that meet the criteria, and the Nominating/Corporate Governance Committee selects candidates that best suit the Board's needs. We do not use a third party to evaluate current Board members.

        The Nominating/Corporate Governance Committee also administers Agilent's Related Person Transactions Policy and Procedures. See "Related Person Transactions Policy and Procedures" for more information.

Executive Committee

        The Executive Committee meets or takes written action when the Board is not otherwise meeting. The Committee has full authority to act on behalf of the Board, except that it cannot amend Agilent's Bylaws, recommend any action that requires the approval of the stockholders, fill vacancies on the Board or any Board committee, fix director compensation, amend or repeal any non-amendable or non-repealable resolution of the Board, declare a distribution to the stockholders except at rates determined by the Board, appoint other committees or take any action not permitted under Delaware law to be delegated to a committee.

Statement on Corporate Governance

        Agilent has had formal corporate governance standards in place since the Company's inception in 1999. We have reviewed internally and with the Board the provisions of the Sarbanes-Oxley Act of 2002 ("Sarbanes-Oxley Act"), the rules of the SEC and the NYSE's corporate governance listing standards regarding corporate governance policies and processes and are in compliance with the rules and listing standards.

        We have adopted charters for our Compensation Committee, Audit and Finance Committee and Nominating/Corporate Governance Committee consistent with the applicable rules and standards. You can access our committee charters, Amended and Restated Corporate Governance Standards and Standards of Business Conduct by clicking on "Governance Policies" in the "Corporate Governance" section, which is on the left side of our web page at www.investor.agilent.com.

Majority Voting for Directors

        Our Bylaws provide for majority voting of directors regarding director elections. In an uncontested election, any nominee for director shall be elected by the vote of a majority of the votes cast with respect to the director. A "majority of the votes cast" shall mean that the number of shares voted "FOR" a director must exceed 50% of the votes cast with respect to that director. The "votes cast" shall include votes to withhold authority and exclude votes to "ABSTAIN" with respect to that director's election. If a director is not elected due to a failure to receive a majority of the votes cast and his or her successor is not otherwise elected and qualified, the director shall promptly tender his or her resignation following certification of the stockholder vote. The Nominating/Corporate Governance Committee will consider the resignation offer and recommend to the Board whether to accept or reject it, or whether other action should be taken. The Board will act on the Nominating/Corporate Governance Committee's recommendation within 90 days

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following certification of the stockholder vote. Thereafter, the Board will promptly disclose their decision and the rationale behind it in a press release to be disseminated in the manner that Company press releases typically are distributed. Any director who tenders his or her resignation pursuant to this provision shall not participate in the Nominating/Corporate Governance Committee recommendation or Board action regarding whether to accept the resignation offer.

Board Communications

        Stockholders and other interested parties may communicate with the Board and Agilent's Non-Executive Chairman of the Board of Directors by filling out the form at "Contact Chairman" under "Corporate Governance" at www.investor.agilent.com or by writing to James G. Cullen, c/o Agilent Technologies, Inc., General Counsel, 5301 Stevens Creek Blvd., MS 1A-11, Santa Clara, California 95051. The General Counsel will perform a legal review in the normal discharge of her duties to ensure that communications forwarded to the Non-Executive Chairman preserve the integrity of the process. For example, items that are unrelated to the duties and responsibilities of the Board such as spam, junk mail and mass mailings, product complaints, personal employee complaints, product inquiries, new product suggestions, resumes and other forms of job inquiries, surveys, business solicitations or advertisements (the "Unrelated Items") will not be forwarded to the Non-Executive Chairman. In addition, material that is unduly hostile, threatening, illegal or similarly unsuitable will not be forwarded to the Non-Executive Chairman. Any communication that is relevant to the conduct of Agilent's business and is not forwarded will be retained for one year (other than Unrelated Items) and made available to the Non-Executive Chairman and any other independent director on request. The independent directors grant the General Counsel discretion to decide what correspondence shall be shared with Agilent management and specifically instruct that any personal employee complaints be forwarded to Agilent's Human Resources Department.

Director Independence

        Agilent adopted the following standards for director independence in compliance with the NYSE corporate governance listing standards:

1.    No director qualifies as "independent" unless the Board affirmatively determines that the director has no material relationship with Agilent or any of its subsidiaries (either directly, or as a partner, shareholder or officer of an organization that has a relationship with Agilent). Agilent or any of its subsidiaries must identify which directors are independent and disclose the basis for that determination.

In addition, a director is not independent if:

2.    The director is, or has been within the last three years, an employee of Agilent or any of its subsidiaries, or an immediate family member is, or has been within the last three years, an executive officer of Agilent or any of its subsidiaries.

3.    The director has received, or has an immediate family member who has received, during any twelve-month period within the last three years, more than $120,000 in direct compensation from Agilent or any of its subsidiaries, other than director and committee fees and pension or other forms of deferred compensation for prior service (provided such compensation is not contingent in any way on continued service).

4.    (A) The director is a current partner or employee of a firm that is Agilent's internal or external auditor; (B) the director has an immediate family member who is a current partner of

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such a firm; (C) the director has an immediate family member who is a current employee of such a firm and personally works on Agilent's audit; or (D) the director or an immediate family member was within the last three years a partner or employee of such a firm and personally worked on Agilent's or any of its subsidiaries' audit within that time.

5.    The director or an immediate family member is, or has been within the last three years, employed as an executive officer of another company where any of Agilent's or any of its subsidiaries' current executive officers at the same time serves or served on that company's compensation committee.

6.    The director is a current employee, or an immediate family member is a current executive officer, of a company that has made payments to, or received payments from, Agilent or any of its subsidiaries for property or services in an amount which, in any of the last three fiscal years, exceeds the greater of $1 million, or 2% of such other company's consolidated gross revenues.

        The Board determined that Paul N. Clark, James G. Cullen, Robert J. Herbold, Robert L. Joss, Koh Boon Hwee, Heidi Fields, David M. Lawrence, M.D. and A. Barry Rand meet the aforementioned independence standards. William P. Sullivan does not meet the aforementioned independence standards because he is Agilent's current President and Chief Executive Officer and an employee of Agilent.

        Agilent's non-employee directors meet at regularly scheduled executive sessions without management. As the Non-Executive Chairman of the Board, James G. Cullen was chosen to preside at the regularly scheduled executive sessions of the non-management directors.

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DIRECTOR COMPENSATION AND STOCK OWNERSHIP GUIDELINES

        Directors who are employed by Agilent do not receive any compensation for their Board activities. As a result, Mr. Sullivan, an employee of Agilent, received no additional compensation for his Board services. The general policy of the Board is that compensation for non-employee directors should be a mix of cash and equity-based compensation. The non-employee director's compensation plan year begins on March 1 of each year. Except for the Non-Executive Chairman, non-employee directors in 2009 received (a) $75,000 in cash which is paid quarterly; (b) $75,000 in value of a stock option; and (c) $75,000 in value of deferred shares of Agilent common stock. Any newly appointed director receives $130,000 in value of deferred shares of Agilent common stock, pursuant to the 2009 Stock Plan. The stock options and the deferred shares vest quarterly over one year.

        In 2009, the Non-Executive Chairman received an annual retainer that consisted of (i) $270,000 in cash which is paid quarterly, (ii) $75,000 in value of a stock option, and (iii) $75,000 in value of deferred shares of Agilent common stock. The Non-Executive Chairman is not eligible to receive any committee chair premiums.

        Effective as of March 1, 2010, incumbent non-employee directors will receive a total of $150,000 in value of a stock grant in lieu of the $75,000 in value of a stock option and $75,000 in value of deferred shares of Agilent common stock that non-employee directors received prior to 2010. The stock grant will be granted on the later of (i) March 1 and (ii) the first trading day after each Annual Meeting of Stockholders.

        The number of shares is determined by dividing $150,000 by the average fair market value of Agilent's common stock over 20 consecutive trading days up to and including the day prior to the grant date. Voluntary deferral is available as an option for the non-employee directors.

        In addition, non-employee directors who serve as the chairperson of a Board committee are entitled to a "committee chair premium." Specifically, the chairperson of the Audit and Finance Committee, provided that she was not the Non-Executive Chairman, on an annual basis, received an additional $20,000 in cash. The chairperson of the Compensation Committee of the Board and Nominating/Corporate Governance Committee of the Board, provided he was not the Non-Executive Chairman, on an annual basis, received an additional $10,000 in cash. Also, each member of the Audit and Finance Committee, on an annual basis, received an additional $10,000 in cash. Each non-employee director may elect to defer all or part of the cash component of his or her annual retainer and committee chair premium under the deferred compensation plan sponsored by Agilent. Any cash compensation that is deferred can only be deferred into shares of Agilent common stock.

        A non-employee director who joins the Board of Directors after the start of the plan year will have his or her stock payment and cash payment pro-rated based upon the remaining days in the plan year that the director will serve.

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Non-Employee Director Compensation for Fiscal Year 2009

        The table below provides information on Agilent's compensation during the fiscal year ended October 31, 2009 for non-employee directors, including (i) cash compensation, and (ii) the compensation expense recognized in Agilent's financial statements for outstanding options and stock awards.

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(1)

Reflects all cash compensation earned during fiscal year 2009, whether or not payment of the cash compensation was deferred pursuant to the 2005 Deferred Compensation Plan for Non-Employee Directors.

(2)

Reflects the dollar amount recognized for financial statement reporting purposes in fiscal year 2009 in accordance with FAS 123(R) for all stock options held by such director and outstanding on October 31, 2009. For additional information, see Note 3 under the heading "Valuation Assumptions" of the Notes to Consolidated Financial Statements included in our Annual Report on Form 10-K for fiscal year 2009. The amounts reflect Agilent's accounting expense for these awards and do not correspond to actual value that will be recognized by the directors with respect to these awards.

(3)

Reflects the dollar amount recognized for financial statement reporting purposes in fiscal year 2009 in accordance with FAS 123(R) for all stock awards held by such director and outstanding on October 31, 2009. It includes the (i) the portion of $75,000 in value of deferred shares of Agilent common stock awarded to the director in the fiscal year 2009 that was expensed in the same year, and (ii) the value of any stock awards received in prior years that were expensed in fiscal year 2009. The amounts reflect Agilent's accounting expense for these awards and do not correspond to actual value that will be recognized by the directors with respect to these awards.

(4)

A supplemental table following these footnotes sets forth: (i) the aggregate number of stock awards and option awards outstanding at fiscal year end; (ii) the aggregate number of stock awards and option awards granted during fiscal year 2009; and (iii) the grant date fair market value of equity awards granted by Agilent during fiscal year 2009 to each of our non-employee directors.

(5)

"Total" column excludes the column "Cash Payment Deferred into Agilent Shares" since this amount is captured in the column "Stock Awards."

(6)

Mr. Cullen has served as the Non-Executive Chairman of the Board since March 1, 2005.

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(7)

Includes an additional $10,000 paid each to Mr. Herbold and Mr. Joss for being a member of the Audit and Finance Committee.

(8)

Includes an additional $20,000 paid to Ms. Fields for chairing the Audit and Finance Committee during fiscal year 2009.

(9)

Includes an additional $10,000 paid to Dr. Lawrence for chairing the Compensation Committee during fiscal year 2009.

Additional Information With Respect to Director Equity Awards

        The following table provides additional information on the outstanding equity awards at fiscal year-end and award during fiscal year 2009 for non-employee directors.

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(1)

Reflects the fair value of stock options and stock awards granted in fiscal year 2009, calculated in accordance with FAS 123(R). For options awards, that number is calculated by multiplying the Black-Scholes value by the number of options awarded. For stock awards, that number is calculated by multiplying (x) the fair market value of our common stock on the date of grant less the per share price by (y) the number of shares awarded.

Non-Employee Director Reimbursement Practice for Fiscal Year 2009

        Non-employee directors are reimbursed for travel and other out-of-pocket expenses connected to Board travel.

Stock Ownership Guidelines

        In 2005, the company adopted a policy that requires each non-employee director to own Agilent shares having a value of at least three times the annual cash retainer (currently $225,000). The shares counted toward ownership guidelines include shares owned outright and the shares of Agilent stock in the director's deferred compensation account. These ownership levels must be attained by the end of fiscal year 2009. Separately, company policy prohibits executive officers, members of the Board of Directors and other senior management employees from engaging in hedging strategies using puts, calls or other types of derivative securities based upon the value of Agilent stock.

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PROPOSALS TO BE VOTED ON

PROPOSAL NO. 1

ELECTION OF DIRECTORS

        Agilent's Board is divided into three classes serving staggered three-year terms. Directors for each class are elected at the annual meeting of stockholders held in the year in which the term for their class expires. Agilent's Bylaws, as amended, allow the Board to fix the number of directors by resolution. The number of directors is currently fixed at nine. Pursuant to resolutions passed by the Board, effective immediately after the time of the annual meeting the authorized number of directors will be reduced to eight in connection with Mr. Robert L. Joss' resignation as a member of Agilent's Board immediately before the annual meeting

        The terms for two directors will expire at the annual meeting. The two nominees named below are the only individuals proposed for election to the Board at the annual meeting. Mr. Robert L. Joss will resign as a director immediately before the annual meeting pursuant to written notice given to Agilent on November 18, 2009.

        Directors elected at the 2010 annual meeting will hold office for a three-year term expiring at the annual meeting in 2013 (or until their respective successors are elected and qualified, or until their earlier death, resignation or removal). All of the nominees are currently directors of Agilent. Information regarding each of the nominees is provided below as of December 18, 2009. There are no family relationships among Agilent's executive officers and directors.

Nominees for Three Year Terms That Will Expire in 2010

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Agilent's Board recommends a vote FOR the election to the Board
of each of the foregoing nominees.

Directors Whose Terms Will Expire in 2010

        On November 18, 2009, Robert L. Joss gave written notice to Agilent that, effective March 2, 2010, immediately before the annual meeting, he will resign as a member of the Board of Directors of Agilent.

        The Agilent directors whose terms are not expiring this year are listed below. They will continue to serve as directors for the remainder of their terms or such other date, in accordance with Agilent's Bylaws. Information regarding each of such directors is provided below.

Directors Whose Terms Will Expire in 2011

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Directors Whose Terms Will Expire in 2012

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PROPOSAL NO. 2

RATIFICATION OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

        The Audit and Finance Committee of the Board has appointed PricewaterhouseCoopers LLP as Agilent's independent registered public accounting firm to audit its consolidated financial statements for the 2010 fiscal year. During the 2009 fiscal year, PricewaterhouseCoopers LLP served as Agilent's independent registered public accounting firm and also provided certain tax and other non-audit services. Although Agilent is not required to seek stockholder approval of this appointment, the Board believes it to be sound corporate governance to do so. If the appointment is not ratified, the Audit and Finance Committee will investigate the reasons for stockholder rejection and will reconsider the appointment.

        Representatives of PricewaterhouseCoopers LLP are expected to attend the annual meeting where they will be available to respond to questions and, if they desire, to make a statement.

Agilent's Board recommends a vote FOR the ratification of the
Audit and Finance Committee's appointment of
PricewaterhouseCoopers LLP as Agilent's Independent Registered Public Accounting Firm.

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PROPOSAL NO. 3

APPROVAL OF THE AGILENT TECHNOLOGIES, INC.
PERFORMANCE-BASED COMPENSATION PLAN FOR COVERED EMPLOYEES

        The Compensation Committee of the Board previously adopted, and in 2000 the stockholders approved, the Agilent Technologies, Inc. Performance-Based Compensation Plan for Covered Employees (the "Former Performance-Based Compensation Plan") (previously entitled the "Agilent Technologies, Inc. Pay-for-Results Plan").

        At the annual meeting, stockholders are being asked to approve the Performance-Based Compensation Plan for Covered Employees (the "Performance-Based Compensation Plan"), which was adopted by the Compensation Committee on November 18, 2009, to replace the Former Performance-Based Compensation Plan. The Performance-Based Compensation Plan would:

•

Increase the number of performance goals available under the Performance-Based Compensation Plan;



•

Give the compensation committee greater flexibility with respect to establishing performance periods of up to a maximum of (36) months using any one or more of the performance goals instead of restricting the performance periods to six-month periods as currently provided under the Performance-Based Compensation Plan; and



•

Modify the maximum per participant award limitation from the current maximum of $1,500,000 during each 6-month performance period to a proposed maximum of $10,000,000 with respect to any 12-month performance cycle.

        The Board believes that a well designed incentive compensation plan for the managers of Agilent is a significant factor in improving operating and financial performance of Agilent, thereby enhancing shareholder value. The Board also believes that all amounts paid pursuant to such a plan should be deductible as a business expense of Agilent. Section 162(m) of the U.S. Internal Revenue Code of 1986, as amended (the "Code") limits the deductibility of bonuses paid to Agilent's Chief Executive Officer and certain other executive officers, unless the plan under which they are paid meets specified criteria, including stockholder approval. The Board believes the adoption of the Performance-Based Compensation Plan to be in the best interest of stockholders and recommends approval. If the Performance-Based Compensation Plan is not approved by Agilent's stockholders, bonuses shall not be paid under the Performance-Based Compensation Plan.

Agilent's Board recommends a vote FOR the approval of the
Agilent Technologies, Inc.
Performance-Based Compensation Plan for Covered Employees.

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Summary of the Performance-Based Compensation Plan

General

        The purpose of the Performance-Based Compensation Plan is to motivate and reward eligible employees by making a portion of their cash compensation dependent on the achievement of certain objective performance goals related to the performance of Agilent and its affiliates. In accordance with Agilent's compensation policy that cash compensation should vary with company performance, a substantial part of each executive's total cash compensation may be tied to Agilent's performance by way of performance-based bonuses under the Performance-Based Compensation Plan.

        Because of the fact-based nature of the performance-based compensation exception under Code Section 162(m) and the limited availability of binding guidance thereunder, Agilent cannot guarantee that the awards under the Performance-Based Compensation Plan to covered employees will qualify for exemption under Code Section 162(m). However, the intention of Agilent and the Compensation Committee is to administer the Plan in compliance with Code Section 162(m) with respect to covered employees or participants who may become covered employees. If any provision of the Performance-Based Compensation Plan does not comply with the requirements of Code Section 162(m), then such provision will be construed or deemed amended to the extent necessary to conform to such requirements.

Administration

        The Performance-Based Compensation Plan will be administered by the Compensation Committee, which will have the authority to interpret the Performance-Based Compensation Plan, to establish performance targets and to establish the amounts of awards payable under the Performance-Based Compensation Plan.

Participation and Eligibility

        Individuals eligible for Performance-Based Compensation Plan awards are officers and key employees of Agilent (as determined by the Compensation Committee), which include Agilent's covered employees (within the meaning of Code Section 162(m)) and executive officers. Each executive officer has an interest in Proposal No. 3. The number of key employees who will participate in the Performance-Based Compensation Plan and the amount of Performance-Based Compensation Plan awards are not presently determinable.

Plan Operation

        This proposal enables Agilent to provide a more competitive bonus plan reflecting the more prevalent customs and practices for bonus plans among its peer group. The payment of awards to each participant is based on an individual bonus target for the performance period set by the Compensation Committee in writing and is directly related to the satisfaction of the applicable performance goal(s) set by the Compensation Committee for such performance period. The

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Performance-Based Compensation Plan increases the number of performance goals available under the Performance-Based Compensation Plan as reflected below:

        Under the Performance-Based Compensation Plan, a performance goal is an objective formula or standard utilizing one or more of the factors in the table above and any objectively verifiable adjustment(s) thereto permitted and preestablished by the Compensation Committee in accordance with Code Section 162(m).

        The Former Performance-Based Compensation Plan provided for six-month performance periods that coincided with each half of Agilent's fiscal year. Pursuant to the Performance-Based

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Compensation Plan, the Compensation Committee will have more flexibility to determine the duration of a performance period as any period not exceeding 36 months. The performance period(s)' individual bonus target(s) and performance goal(s) will be adopted by the Compensation Committee in its sole discretion with respect to each performance period and must be adopted no later than the latest time permitted by the Internal Revenue Code in order for bonus payments pursuant to the Performance-Based Compensation Plan to be deductible under Code Section 162(m). Additionally, the Compensation Committee may establish different performance periods for different participants, and the Committee may establish concurrent or overlapping performance periods.

        Bonus payments under the Performance-Based Compensation Plan may be made in cash only. The actual amount of future bonus payments under the Performance-Based Compensation Plan is not presently determinable. However, the Performance-Based Compensation Plan provides that the maximum amount of any Awards that can be paid under the Performance-Based Compensation Plan to any participant with respect to any 12-month performance cycle is $10,000,000. Prior to the Former Performance-Based Compensation Plan, the maximum amount was $1,500,000 during each 6-month performance period. The $10,000,000 maximum award with respect to any 12-month performance period is better aligned with current competitive maximums of Agilent's peer group and gives the compensation committee greater flexibility to award cash incentives based on need pursuant to prevalent practices by members of Agilent's peer group and pursuant to potential concurrent or overlapping performance periods. Further, the Compensation Committee, in its sole discretion, may reduce or eliminate the amount of a participant's bonus under the Performance-Based Compensation Plan to an amount below the amount otherwise payable pursuant to the Performance-Based Compensation Plan formula.

        The payment of a bonus for a given performance period generally requires the participant to be employed by Agilent as of the last day of the performance period. Prior to the payment of any bonus under the Performance-Based Compensation Plan, the Compensation Committee must make a determination, certified in writing, that the conditions to payment for the applicable performance period have been satisfied. The payment of bonuses under the Plan must be made in cash and occur within a reasonable period of time after the end of the applicable performance period.

Federal Income Tax Considerations

        All amounts paid pursuant to the Performance-Based Compensation Plan are taxable income to the employee when paid. Agilent will be entitled to a federal income tax deduction for all amounts paid under the Performance-Based Compensation Plan if it is approved by stockholders and meets the other requirements of Section 162(m) of the Code.

Amendment and Term of the Plan

        The Performance-Based Compensation Plan will first become available for performance periods beginning in fiscal 2010. The Performance-Based Compensation Plan does not have a fixed termination date and may be terminated by the Compensation Committee at any time, provided that such termination will not affect the payment of any award accrued prior to the time of termination. The Compensation Committee may amend or suspend, and reinstate, the Performance-Based Compensation Plan at any time, provided that any such amendment or reinstatement shall be subject to shareholder approval if required by Code Section 162(m), or any other applicable laws, rules or regulations.

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Plan Benefits

        All awards under the Performance-Based Compensation Plan to the Agilent officers named in the Summary Compensation Table on page              and all current executive officer participants as a group during fiscal 2010 will be based on Agilent's actual performance during fiscal 2010 and will be made at the discretion of the Compensation Committee. Therefore, the benefits and amounts that will be received or allocated under the Performance-Based Compensation Plan to Agilent's executive officers during fiscal 2010 are not determinable at this time. Cash bonuses paid to our named executive officers during fiscal 2009 are shown in this Proxy Statement in the Summary Compensation Table included in the section entitled "Executive Compensation" below and discussed in more detail in the section entitled "Compensation Discussion and Analysis—Short-Term Cash Incentives" below.

Incorporation By Reference

        The foregoing is only a summary of the Performance-Based Compensation Plan and is qualified in its entirety by reference to its full text, a copy of which is attached hereto as Appendix A.

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COMMON STOCK OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT

        The following table sets forth information, as of December 18, 2009, concerning:

•

each person or group known by Agilent, based on filings pursuant to Section 13(d) or (g) under the Securities Exchange Act of 1934, as amended (the "Exchange Act"), to own beneficially more than 5% of the outstanding shares of our common stock as of the Record Date;



•

the beneficial ownership of Agilent's common stock by each director and each of the executive officers named in the Summary Compensation Table herein; and



•

the beneficial ownership of Agilent's common stock by all directors and executive officers as a group.

        The number of shares beneficially owned by each entity, person, director or executive officer is determined under the rules of the SEC, and the information is not necessarily indicative of beneficial ownership for any other purpose. Under such rules, beneficial ownership includes any shares as to which the individual has the sole or shared voting power or investment power and also any shares that the individual has the right to acquire as of February 16, 2010, 60 days after December 18, 2009, through the exercise of any stock option or other right. Unless otherwise indicated, each person has sole investment and voting power, or shares such powers with his or her spouse, with respect to the shares set forth in the following table.

BENEFICIAL OWNERSHIP TABLE

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Section 16(a) Beneficial Ownership Reporting Compliance

        Section 16(a) of the Exchange Act, requires Agilent's directors, executive officers and holders of more than 10% of Agilent common stock to file reports with the SEC regarding their ownership and changes in ownership of Agilent stock. Agilent believes that during the 2009 fiscal year, its executive officers, directors and holders of 10% or more of our common stock complied with all Section 16(a) filing requirements with the following exceptions. A Form 4 reporting the surrender of 556 shares and 34 shares to Agilent to satisfy the tax liability on the release of restricted shares issued to Koh Boon Hwee on March 2, 2009 and November 2, 2009, respectively was inadvertently not filed. An amended Form 4 was filed on December 24, 2009 to correct these omissions. In making these statements, Agilent has relied upon examination of copies of Forms 3, 4 and 5 provided to Agilent and the written representations of its directors and officers.

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COMPENSATION DISCUSSION AND ANALYSIS

Overview

        The Compensation Committee is responsible for Agilent's compensation philosophy, as well as making determinations regarding all forms of compensation for our named executive officers. The "Executive Compensation" section of this Proxy Statement presents the detailed compensation arrangements for our named executive officers for fiscal year 2009. For the fiscal year ended October 31, 2009, our named executive officers and their titles were as follows:

•

William P. Sullivan, President and Chief Executive Officer



•

Adrian T. Dillon, Executive Vice President, Finance and Administration and Chief Financial Officer



•

D. Craig Nordlund, Former Senior Vice President, General Counsel and Secretary



•

Ronald S. Nersesian, Senior Vice President, Agilent, President, Electronic Measurement Group



•

Michael R. McMullen, Senior Vice President, Agilent, President, Chemical Analysis Group



•

Nicolas Roelofs, Senior Vice President, Agilent, President, Life Sciences Group

        Mr. Nordlund announced his retirement from Agilent on May 26, 2009. He retired (and concurrently resigned) as an executive officer effective as of September 22, 2009 and entered into a Separation Agreement and General Release Agreement with Agilent. Mr. Nordlund remained an employee of Agilent through October 31, 2009.

Compensation Philosophy

        The objectives of our executive compensation program are to:

•

align pay with performance;



•

keep overall compensation competitive with our peer group and the larger business market where applicable, and



•

ensure that we can recruit, motivate and retain executives in the larger marketplace.

        Executive compensation at Agilent is comprised of four basic elements.

        Base Salary.    Base salaries have historically accounted for 50% or less of total compensation for our executives. This element is intended to establish the minimum or base-line competitive compensation level that sits beneath the incentive compensation components.

        Discretionary Bonus.    The Compensation Committee may award discretionary bonuses in order to recognize outstanding individual performance or assist in the retention of key talent. No such awards were made in fiscal 2009.

        Short-Term Cash Incentives.    We use short-term cash performance incentives using both revenue growth and Return On Invested Capital ("ROIC") metrics to determine the short-term bonus payout. ROIC is a non-GAAP measure and defined as:

        Income (loss) from operations less other (income) expense and taxes, annualized, divided by the average of the three most recent quarter-end balances of assets less net current liabilities.

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        Long-Term Incentives.    Long-term performance incentives are a combination of (1) regular stock options and (2) equity awards that vest based on total shareholder return of Agilent vs. peer companies over a three-year period. This long-term incentive component has both a medium-term incentive with the three-year performance-based stock awards under our Long-term Performance Program (the "LTP Program") as well as a longer-term incentive in the form of time-based stock option awards, which vest annually over a 4-year period and have a 10-year exercise term. For a technology company such as Agilent, we feel that a compensation perspective spanning a range of short-term to very long-term helps in retaining key executives. Our executive compensation program provides this range while also adding the security of competitive base salary and a good benefits package.

        Our target total rewards package for each named executive officer will vary based on (i) company performance measured against external metrics that correlate to long-term stockholder value, (ii) performance of the business organizations against specific targets, and (iii) individual performance measured against internal metrics. These performance measures form the basis of the Compensation Committee's decisions regarding each of our four principal elements of pay: base salary, discretionary bonuses, short-term incentive compensation and long-term incentive compensation, each of which is discussed in detail below.

        Additionally, we designed our total rewards package such that our short-term and long-term incentives programs do not encourage executives to take unnecessary risks. This is accomplished through the following measures:

•

Mix of short-term and long-term incentives do not overemphasize short-term incentives over long-term incentives;



•

Performance metrics with thresholds, targets and maximums (not to exceed 150-200% of target under the Performance-Based Compensation Plan (as described below) and the LTP Program) are presented to and approved by the Compensation Committee for both short-term and long-term incentive programs;



•

The Compensation Committee considers the full range of potential upside and downside payouts;



•

The short-term incentives program allows the Compensation Committee to exercise downward discretion where appropriate; and



•

The newly adopted Executive Compensation Recoupment Policy permits recoupment of both short-term and long-term incentives from executives across a broad range of circumstances.

Setting Objectives and Measuring Performance: Internal Metrics

        Each fiscal year, management engages in a planning process to establish internal performance measures, metrics and targets for the fiscal year consisting of (i) company performance, (ii) business unit level performance and (iii) individual performance. Company goals and metrics include revenue and profitability targets for the fiscal year. Business unit level performance goals and metrics are set by our CEO and include expense levels, ROIC and revenue growth and individual performance goals and metrics for Business Unit Vice Presidents include customer survey results as well as employee feedback on the company's leadership surveys. The CEO uses these goals, metrics and targets to evaluate the performance of each of the named executive officers, other than himself. Once company targets have been reviewed and approved by our full Board, they become the basis for the Compensation Committee's evaluation of executive

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performance and setting compensation levels for the then-current fiscal year based on that performance.

        Agilent uses an internal relative ranking system to evaluate the performance of all employees, including our named executive officers. Executive officers are ranked by the CEO based on three main components: delivering results, setting strategic direction and building organizational capability.

        Metrics used to assess individual performance are set at the enterprise level by the Compensation Committee for Mr. Sullivan, Mr. Dillon, and Mr. Nordlund. Each of the Business Unit, including Mr. Nersesian, Mr. McMullen and Mr. Roelofs, are measured against their respective business level metrics.

        The measures used at both the enterprise level and business unit level include:

•

Core measures: ROIC and revenue;



•

Diagnostic measures: orders, operating expenses, gross margin, operating margin, working capital (including inventory days and collections), headcount and total stockholder return;



•

Customer loyalty measures: Agilent customer loyalty index and customer satisfaction data;



•

Growth measures: Growth of business year-over-year by quarter, revenue added by merger and acquisition activity, as well as new product revenue and market share; and



•

Leadership measures: Scores on an employee survey index.

Setting Objectives and Measuring Performance: External Benchmarking

        At the beginning of each year, our Senior Vice President, Human Resources meets with the Compensation Committee's independent compensation consultant, currently Fredrick W. Cook & Co., Inc. ("F.W. Cook"). After discussion with our Senior Vice President, Human Resources, the following objective selection criteria was selected by F.W. Cook and the Compensation Committee to determine the peer group listed below: each company in the peer group is (1) a publicly traded high technology, measurement and/or life science company and (2) had revenues in fiscal year 2008 which were in the range of approximately 0.5 to 2 times Agilent's total revenues in fiscal year 2008.

        In fiscal year 2009, for purposes of determining Total Shareholder Return ("TSR") under the LTP Program, the Compensation Committee expanded the peer group for the LTP Program from 60 companies used in fiscal year 2008 to all companies in the S&P 500 Indexes Information Technology, Heath Care and Industrials Sectors (approximately 187 companies). The expanded peer group provides a broader index for comparison, better alignment with shareholder investment choices and decreases the need to adjust the peer group based on S&P changes. The S&P 500 constituent list is maintained by the S&P Index Committee, a team of Standard & Poor's economists and index analysts, who meet on a regular basis to evaluate additions and/or deletions to the list of companies in our selected peer group, based on Standard &Poor's published guidelines which are available on the website www.indices.standardandpoors.com. The change in the number of companies in our peer group is due to the fact that some companies within the index failed to meet one or more of Standard & Poor's criteria for index inclusion and as a result, were excluded from the S&P 500 list.

        For all other elements of compensation, we use a compensation survey of executive total compensation prepared by the Radford Survey + Consulting, a unit of Aon Consulting, which

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provides compensation market intelligence on our peer group of 38 high technology and life sciences companies, as listed below, with revenues between $3 billion and $12 billion for corporate positions while data for business unit positions were based on the appropriate revenue cut for each unit. The Radford survey is a total compensation survey that includes total direct compensation, including base salary, annual short-term incentive compensation and long-term incentive compensation and is widely used and known within the high technology industry. For the General Counsel, Senior Vice President, Human Resources and business unit vice presidents' positions, the Radford survey data is used by F.W. Cook for benchmarking those positions because there is very little peer group data available. For the CEO, and CFO positions, F.W. Cook used the compensation information reported in the public filings of these companies to make our comparisons and adjusts the data to reflect the age of the reported information.

The Compensation Committee Process and the Role of Management

        To determine total compensation for the upcoming fiscal year, the Compensation Committee uses the performance ranking for the individual executive, reviews the peer group data from the Compensation Committee's independent consultant, and analyzes these measures against our business and strategic goals for the coming fiscal year. F.W. Cook makes recommendations that provide insight to market practices for the Committee's actions, but it does not make any specific compensation recommendations on the individual named executive officers. The Compensation Committee determines the form and amount of compensation for all executive officers. For fiscal year 2009, F.W. Cook advised the Committee on a spectrum of matters, including but not limited to:

•

Criteria used to identify peer companies for executive compensation and performance metrics;



•

Target percentages for total compensation and each element of compensation;



•

Evaluation of Agilent's total rewards program for the named executive officers and 7 other senior officers against similar positions at companies within our peer group and our business objectives;



•

Mix of long-term incentives under the LTP Program and conversion ratio;



•

Design changes to the short- and long-term incentive compensation plans for future years;



•

Competitiveness of Agilent's non-employee director compensation; and



•

Various other proposals presented to the Compensation Committee by management.

        For fiscal year 2009, the process for determining compensation also included a comprehensive review of detailed tally sheets for the CEO and other named executive officers. Tally sheets used for 2009 included all elements of executive compensation listed in the section

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under "Compensation Paid for Fiscal Year 2009", including potential compensation to our named executive officers in the event of change of control.

        The Compensation Committee, which is composed solely of independent members of the Board, operates under a Board-approved charter which spells out the Committee's duties and responsibilities. This charter is available on Agilent's website at http://media.corporate-ir.net/media_files/IROL/10/103274/CorpGov/Com pCommCharter_0707.pdf.

        The CEO and the Senior Vice President, Human Resources consider the responsibilities, performance and capabilities of each of the named executive officers and what compensation package they believe will incent each to achieve the targeted results for Agilent. The analysis used is a combination of the market data based on our peer group and the survey data mentioned above, performance against the targets, and overall performance assessment (resulting in a rank). The elements are used to determine if an increase is warranted and the amount and type of any increase for each of the total compensation components for the then-current fiscal year. After consulting with the Senior Vice President, Human Resources, the CEO makes compensation recommendations, other than for his own compensation, to the Compensation Committee at the first Compensation Committee meeting of the fiscal year. The Senior Vice President, Human Resources does not provide input on setting her own compensation.

        The Compensation Committee's process is also aided by F.W. Cook, who reports to the Compensation Committee. As noted above, the role of the independent compensation consultant is to measure and benchmark our executive officer compensation against certain peer group companies (described above) with respect to total compensation levels for positions comparable to our named executive officers and certain other positions. The independent compensation consultant recommends the appropriate range for base pay, discretionary bonuses, short-term incentive targets, and long-term incentive targets of the total compensation package. This information is reviewed and discussed at a Compensation Committee meeting. The consultant's information for compensation levels for the coming fiscal year is used by the Compensation Committee to establish salary, discretionary bonus, any short-term incentive, long-term incentive and stock awards for our CEO, CFO and each of the other named executive officers.

        The Compensation Committee is responsible for determining the final compensation package for each named executive officer. However, in making its decision, the Compensation Committee considers the recommendations of management, its independent compensation consultant and our full Board (except the input of the CEO for his own compensation).

        Agilent's Senior Vice President, Human Resources works directly with the Compensation Committee Chair to provide the data and framework and to answer questions related to the CEO's total compensation. The CEO is not involved in the process to set his compensation. The Compensation Committee establishes the CEO's compensation based on a thorough review of the CEO's performance that includes: (i) an objective assessment against agreed-to metrics set by the Compensation Committee; (ii) tally sheets, (iii) a self-evaluation by the CEO that the Compensation Committee discusses with the independent directors; and (iv) a qualitative evaluation of the CEO's performance that is developed by the independent directors, including each member of the Compensation Committee, in executive session. The CEO's total direct compensation package is reviewed annually by the Compensation Committee, which then presents its recommendation to the other independent directors. The Compensation Committee then makes the final determinations on compensation for the CEO.

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Recoupment Policy

        In July 2009, the Compensation Committee adopted an Executive Compensation Recoupment Policy which applies to all of our executive officers under Section 16 of the Securities Exchange Act. Under this Policy, in the event of (A) a material restatement of financial results (which results were incorrect at the time published due to mistake, fraud or other misconduct), or (B) fraud or misconduct by an executive officer, the Compensation Committee will, in the case of a restatement, review all short and long-term incentive compensation awards that are paid or awarded to executive officers for performance periods beginning after July 14, 2009 that occur, in whole or in part, during the restatement period. In the case of fraud or misconduct, the Committee will consider actions to remedy the misconduct, prevent its recurrence, and impose discipline on the wrongdoers, in each case, as the Committee deems appropriate.

        If the Compensation Committee concludes that, as a result of incorrect financial results, an executive officer has received more incentive compensation than he/she would have received under the restated financial results, or that fraud or misconduct warrants remedial actions, it may take such actions as it deems appropriate in its sole discretion after considering all relevant facts and circumstances. These actions may include without limitation, to the extent permitted by governing law, requiring reimbursement of compensation, causing the cancellation of outstanding restricted stock or deferred stock awards, stock options, and other equity incentive awards, limiting future awards or compensation, and requiring the disgorgement of profits realized from the sale of Agilent stock to the extent such profit was, in part or in whole, resulting from fraud or misconduct.

Compensation Paid for Fiscal Year 2009

        In addition to our four principal pay elements (base salary, discretionary bonuses, short-term incentive compensation and long-term incentive compensation), executive compensation at Agilent consists of the following components:

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Benefits



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Health and welfare



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Disability insurance



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Life insurance



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Financial counseling



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Executive physical medical examination



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Non-qualified deferred compensation



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Pension plans



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Change of control agreements

        For compensation paid to the named executive officers in fiscal year 2009, we targeted the 50^th to the 75^th percentile of peer group companies. The Compensation Committee chose this range in order to attract, retain and motivate our executives as well as provide rewards for such factors as job performance, skill set, prior experience, time in the position and/or with Agilent, and superior achievement in current business conditions. With this pay positioning, the Compensation Committee believes the company will achieve above 50^th percentile business

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performance against the peer group and the following illustrates that Agilent is approximately in the 50^th to 75^th percentile of the peer group based on revenue and market capitalization:

        Our named executive officers' target total compensation for fiscal year 2009 varied from 88% to 144% of target benchmark data for each position, measured from the 50^th percentile, which means that the Compensation Committee looked at the benchmark data at the 50^th percentile, measured each named executive officer's compensation against that data and set compensation levels for each named executive officer above or at the 50^th percentile based on that named executive officer's overall performance ranking for fiscal year 2009.

        Our CEO's total compensation is approximately two times the total compensation of our CFO. Our Compensation Committee believes that based on market data, the CEO merits a larger total compensation package as a result of his significant additional responsibilities. The CEO's base salary in fiscal year 2009 was within our target of the 50th to the 75th percentile of the benchmark data of other CEOs in our peer group.

        For the CFO, the Compensation Committee considered peer group data for both the CFO and the COO positions when setting the total compensation for Mr. Dillon, in recognition of his additional job responsibilities that are more operational in nature and broader in scope than those of the average CFO. For fiscal year 2009, the CFO's total compensation was within our target of the 50^th and 75^th percentiles of the benchmark data for both the CFOs and COOs in our peer group.

        Our executives' total compensation packages reflect Agilent's philosophy of aligning pay with performance and rewarding top talent. Accordingly, approximately 74% of our CEO's total direct compensation and 62% of our named executive officers' total direct compensation (non-equity incentive plan payouts, stock awards and option awards) is "at-risk"—which means that our executives' compensation varies year on year depending on Agilent's revenue, return on invested capital, absolute stock price performance, and relative total shareholder return versus our peers. Long-term incentive awards, which for fiscal year 2009 consisted primarily of stock options and performance-based stock awards, represent the largest element of pay for senior executives in order to encourage creation of lasting value for our stockholders by directly tying executive compensation to our success and our stockholders' interests.

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Base Salary

        Our salaries reflect the responsibilities of each named executive officer, the competitive market for comparable professionals in our industry, and are set to create an incentive for executives to remain with Agilent. Salaries as well as our benefits packages are the components of our named executive officers' compensation packages that are fixed and do not vary with company performance. Base salaries of our named executive officers are set by considering the benchmark market data described above as well as the performance of the named executive officers.

Short-Term Cash Incentives

        The Agilent Technologies, Inc. Performance-Based Compensation Plan for Covered Employees ("Performance-Based Compensation Plan") applies to our named executive officers and provides the opportunity for cash awards every six months linked to specific business financial targets. Agilent has two major lines of business, the Electronic Measurement Group ("EMG") and the Life Sciences and Chemical Analysis Group ("LSCA"). The business and financial targets for each fiscal year half are pre-established by the Compensation Committee at the beginning of each fiscal half, based on recommendations from management. After the Compensation Committee certifies the calculations of performance against metrics for the fiscal year half, payouts, if any, are made in cash. Metrics and goals cannot be changed after they have been approved by the Compensation Committee. The Performance-Based Compensation Plan reflects our pay-for-performance philosophy and directly ties short-term incentives to short-term business performance.

        For fiscal year 2009, the Performance-Based Compensation Plan targets were based on ROIC goals and revenue goals. ROIC was chosen as a metric because the Compensation Committee believes it measures how efficiently and effectively management deploys capital. We believe that sustained ROIC levels greater than our cost of capital create wealth for our stockholders. Revenue was chosen because it places focus on our continued growth. To determine the payout, we use payout matrices for eligible individuals at the Agilent, or business unit level. The payout matrices link the two metrics (ROIC and Revenue) and contain all payout possibilities from threshold to the maximum of both the metrics. Bonuses were not paid unless the ROIC threshold was achieved. The Compensation Committee determined the goals and metrics based upon recommendations from the CEO and Senior Vice President, Human Resources. The target metrics set for our short-term incentives and their corresponding results were as follows:

        Our Compensation Committee set the monetary value of the fiscal year 2009 short-term incentive targets based on a percent of base salary for each named executive officer. The Compensation Committee also considered the relative responsibility of each named executive officer. In response to the economic downturn, as stated in the table above, our Compensation Committee approved target metrics that were lower for the second half of the fiscal year (when compared to the metrics set in the first half of the fiscal year) to motivate our executives to achieve realistic business goals. The Committee also lowered the maximum payouts for the second half of fiscal year 2009 from 200% to 150% of target to correspond to the lower targets. Each

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named executive officer's short-term incentive target for fiscal year 2009 was set between 70% and 140% of base salary (depending on his or her position), as follows:

Fiscal Year 2009 Short-Term Incentive Payout Table*

        These targets were established with reference to the 50^th to 75^th percentile of comparable positions at companies in our peer group, as discussed above. Considering both short-term incentive and base salary together, the Compensation Committee confirmed that the total cash awards (the sum of both base salary and short-term incentive) were also targeted with reference to the same competitive positioning. The detailed payouts are provided in the "Non-Equity Incentive Plan Compensation" column in the "Summary Compensation Table".

        For fiscal year 2010, subject to shareholder approval, Agilent is replacing its Former Performance-Based Compensation Plan with the Performance-Based Compensation Plan which, among other things, incorporates a strategic component as an objective performance criteria to reward performance tied to Agilent's corporate strategic plan. This Performance Based Compensation Plan for Covered Employees is contingent upon shareholder approval and further details are described in Proposal 3 on page 20.

Long-Term Incentives

        The Agilent long-term incentive program is designed to encourage creation of lasting value for our stockholders, retain qualified key employees, and build equity ownership among executives. By paying the awards in a combination of Agilent stock and stock options, the long-term rewards for executives are directly tied to our success in the creation and preservation of our stockholders' interests and long-term shareholder value.

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Setting Targets for Long-Term Incentives

        We set a single long-term incentive target for each named executive officer each fiscal year, which is then delivered in two components: (i) a non-qualified stock option, and (ii) a potential stock award under our LTP Program. Shares for both awards will be issued under the 1999 Stock Plan if the award was approved prior to March 11, 2009 and will be issued under the 2009 Stock Plan for awards approved thereafter. The purpose of the option grants is to motivate executives to achieve business results, which in turn increase stockholder value. The LTP Program stock awards and stock options are intended to drive our key executives to envision and pursue longer-term strategies that will enhance our competitive position against our peer group over time. The target value of the long-term incentive award is determined at the beginning of the then-current fiscal year for each named executive officer position and is partially derived from the peer group data provided by the Compensation Committee's independent compensation consultant and data from the Radford survey. The target value also reflects the Compensation Committee's judgment on the relative role of each named executive officer's position within Agilent, as well as the performance of each named executive officer.

        For fiscal year 2009, the Compensation Committee approved long-term incentive value targets for each named executive officer, expressed as a monetary amount that ranged between the 50^th to 75^th percentiles of long-term incentive awards for comparable executives at companies in our peer group. That monetary target was then converted into each long-term incentive vehicles as follows:

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Approximately half the value of the long-term award was in the form of stock options, calculated by the Black-Scholes value using a 20-day average closing price of our common stock. The exercise price of the option was the fair market value (defined under our Stock Plan as the closing price of our common stock) on the date of grant. The options vest at the rate of 25% each year and contain other provisions identical to those stock options granted to non-executive employees.



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The remaining value of the long-term award is a target stock award, delivered under the LTP Program, and determined by dividing the remaining value by the Monte-Carlo valuation factor as provided by Watson Wyatt. The target stock award may be earned at the end of a three-year performance cycle if the established performance metrics are achieved, as further described below. The resulting final stock payout award may range from 0 to 200% of the originally set target and, if earned, is awarded in the form of unrestricted shares.



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Targeting approximately half of the long-term incentive value in stock options and half of the value in performance shares keeps focus on absolute stockholder value creation and Agilent's performance relative to its peers. In addition, the market data of our peer group supports this approach of delivering about half of the long-term incentive value in a stock option and half in a performance-based stock award.

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        The Compensation Committee has established rolling three-year performance periods for determining the stock awards under our LTP Program to focus executives on Agilent's relative stock performance as compared to our peers over each three-year cycle, using relative total shareholder return ("TSR") as our metric. For purposes of these determinations, relative "TSR" reflects (i) the aggregate change in the 20-day average closing price of Agilent's stock versus each of the companies in Agilent's LTP Program peer group, plus (ii) the value (if any) returned to shareholders in the form of dividends or similar distributions, assumed to be reinvested on a pre-tax basis, each at the beginning and the end of the three-year performance period.

        Because performance shares are granted each year and are subject to a three-year performance period, multiple performance share awards are outstanding simultaneously and payouts made in any particular fiscal year may not correspond with Agilent stock performance during the most recent fiscal year. The Compensation Committee also sets performance measures and objective business criteria metrics for achieving the target awards at the beginning of the performance period. The actual results are calculated at the end of the three-year performance period by the Compensation Committee's independent compensation consultant and are presented to the Compensation Committee for review and certification of achievement of results. The Compensation Committee determines the final awards, if any.

Actual Long-Term Incentives Payout for Fiscal Year 2009

        After considering market practice and consulting with its independent compensation consultant, the Compensation Committee determined the following relationship of TSR performance and the final stock payout for the performance period from fiscal year 2007 to 2009:

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