Halliburton is pleased to confirm that the Department of Labor has concluded its investigation of the company’s U.S. retirement plans and that all outstanding issues have been successfully resolved.

Halliburton cooperated extensively with the Department of Labor to identify and resolve, on a voluntary basis, issues involving certain retirement plans. As the closing letter from the DOL indicates, the issues were fully resolved from 2003 to 2004 and as a result the Department stated it would take no further action.

The DOL referred to three main issues, which Halliburton proactively and voluntarily resolved in the following ways:

Timeliness of the Prudential Demutualization:
Administration of the proceeds attributable to the Prudential demutualization was a colossal effort that impacted over 10,000 lives and required collaboration with benefits administration, benefits accounting, tax, legal, corporate trust and outside vendors to ensure that treatment of the proceeds was handled correctly and that the company acted prudently and with due diligence. While the company was in the process of determining how to distribute the proceeds, there was limited DOL guidance with respect to administering this matter. The issue was resolved in April 2003 with the disbursement of proceeds to the participants, including five percent interest on the distribution amount.

Settlor’s Expenses:
Working together with the DOL, Halliburton Global Benefits Department identified the issue and corrected it to the mutual satisfaction of both the company and the DOL. Halliburton further filed a Form 5330 to report the error and paid an excise tax to the Internal Revenue Service. This issue was resolved in August 2004.

Participant Loans:
Halliburton approached the IRS under an IRS correction program to address the matter with the defaulted participant loans. Halliburton followed the IRS correction procedure in order to maintain the tax qualified status of the affected plans. The issue was resolved and Halliburton reimbursed the affected participants in March 2004.

Halliburton is pleased that these issues have been resolved to the Department of Labor’s satisfaction.

Additionally, Halliburton is proud of the fact that its domestic retirement plans are some of the most cost-effective plans anywhere, providing greater value for our employees. On average, the expense ratios (the amount of a fund’s operating expenses divided by the fund’s total asset base, expressed as a percentage) for Halliburton’s funds are less than half of those for other comparable retail alternatives. The company strives to keep its fund operating expenses low -- and because expenses are paid from fund assets, this means greater value for plan participants.