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Proxy Statement Pursuant to Section 14(a) of the Securities
Exchange Act of 1934 (Amendment No. )
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March 22, 2005
To Our Stockholders:
• | elect a Board of Directors of nine Directors to serve for the coming year; |
• | ratify the selection of KPMG LLP as independent accountants to examine the financial statements and books and records of Halliburton for 2005; and |
• | consider two stockholder proposals. |
DAVID J. LESAR
Chairman of the Board, President
and Chief Executive Officer
to be Held May 18, 2005
1. | To elect nine Directors to serve for the ensuing year and until their successors shall be elected and shall qualify. |
2. | To consider and act upon a proposal to ratify the appointment of KPMG LLP as independent accountants to examine the financial statements and books and records of Halliburton for the year 2005. |
3. | To consider and act upon two stockholder proposals, if properly presented at the meeting. |
4. | To transact any other business that properly comes before the meeting or any adjournment or adjournments of the meeting. |
• | electronically via the Internet at http://www.proxyvoting.com/hal, |
• | by telephone if you are in the U.S. and Canada, by calling 1-866-540-5760 (toll-free), or |
• | by marking your votes, dating, signing the proxy card or voting instruction form enclosed and returning it in the postage-paid envelope provided. |
IF YOU PLAN TO ATTEND:
MARGARET E. CARRIERE
Vice President and Secretary
March 22, 2005
You are urged to vote your shares as promptly as possible by (1) following the enclosed voting instructions to vote via the Internet or by telephone, or (2) marking your votes, dating, signing and returning the enclosed proxy card or voting instruction form.
TABLE OF CONTENTS
Page | ||
---|---|---|
General Information | 1 | |
Item 1 — Election of Directors | 2 | |
Information about Nominees for Director | 2 | |
Stock Ownership of Certain Beneficial Owners and Management | 4 | |
Corporate Governance | 6 | |
The Board of Directors and Standing Committees of Directors | 6 | |
Executive Compensation | ||
Compensation Committee Report on Executive Compensation | 12 | |
Comparison of Cumulative Total Return | 17 | |
Summary Compensation Table | 18 | |
Option Grants for Fiscal 2004 | 20 | |
Option Exercises and Values for Fiscal 2004 | 20 | |
Long-Term Incentive Plans — Awards in Fiscal 2004 | 21 | |
Equity Compensation Plan Information | 21 | |
Employment Contracts and Change-In-Control Arrangements | 22 | |
Directors’ Compensation | 24 | |
Audit Committee Report | 26 | |
Fees Paid to KPMG LLP | 27 | |
Item 2 — Ratification of the Selection of Auditors | 28 | |
Item 3 — Stockholder Proposal on Severance Agreements | 29 | |
Item 4 — Stockholder Proposal on Director Election Vote Threshold | 31 | |
Additional Information | 33 | |
Other Matters | 33 | |
Appendix A — Corporate Governance Guidelines | A-1 | |
Appendix B — Corporate Policy, Services of Independent Accountants | B-1 |
i
PROXY STATEMENT
GENERAL INFORMATION
1
• | as necessary to meet legal requirements and to assert claims for and defend claims against Halliburton; |
• | when disclosure is voluntarily made or requested by the stockholder; |
• | when the stockholder writes comments on the proxy card; or |
• | in the event of a proxy solicitation not approved and recommended by the Board of Directors. |
ELECTION OF DIRECTORS
(Item 1)
Information about Nominees for Director
ROBERT L. CRANDALL, 69, Chairman Emeritus, AMR Corporation/American Airlines, Inc. (engaged primarily in the air transportation business); President, American Airlines, Inc. 1980–1995; Chairman, President and Chief Executive Officer, AMR Corporation/American Airlines 1985–1995; and Chairman and Chief Executive Officer, AMR Corporation/American Airlines 1985–1998; joined Halliburton Company Board in 1986; Chairman of the Audit Committee and member of the Compensation and the Management Oversight Committees; Director of Air Cell, Inc., Anixter International, Celestica Inc., i2 Technologies, Inc., and serves on the Federal Aviation Administration Management Advisory Committee. |
2
KENNETH T. DERR, 68, Retired Chairman of the Board, Chevron Corporation (an international oil company); Chairman and Chief Executive Officer, Chevron Corporation, 1989–1999; joined Halliburton Company Board in 2001; Chairman of the Compensation Committee and member of the Audit, the Nominating and Corporate Governance and the Management Oversight Committees; Director of AT&T Corp., Citigroup Inc. and Calpine Corporation. | ||
S. MALCOLM GILLIS, 64, University Professor, Rice University, since 2004; President, Rice University, 1993–2004; Ervin Kenneth Zingler Professor of Economics, Rice University, 1996–2004; Professor of Economics, Rice University, 1993–2004; Director of Service Corporation International, Introgen Therapeutics, Inc. and AECOM Technology, Los Angeles. | ||
W. R. HOWELL, 69, Chairman Emeritus, J.C. Penney Company, Inc. (a major retailer); Chairman of the Board, J.C. Penney Company, Inc., 1983–1996; Chief Executive Officer, J.C. Penney Company, Inc., 1983–1995; joined Halliburton Company Board in 1991; Lead Director, Chairman of the Management Oversight Committee and member of the Audit and the Compensation Committees; Director of American Electric Power Company, Exxon-Mobil Corporation, Pfizer Inc. and the Williams Company. He is also a Director of Deutsche Bank Trust Corporation and Deutsche Bank Trust Company Americas, non-public wholly owned subsidiaries of Deutsche Bank AG. | ||
RAY L. HUNT, 61, Chief Executive Officer, Hunt Oil Company (oil and gas exploration and development) and Chairman of the Board, Chief Executive Officer and President, Hunt Consolidated, Inc. for more than five years; Chairman of the Board, Hunt Oil Company, 1986–2004, joined Halliburton Company Board in 1998; Chairman of the Nominating and Corporate Governance Committee and member of the Management Oversight Committee; Director of Electronic Data Systems Corporation, PepsiCo, Inc., King Ranch Company and Verde Group, L.L.C.; also Chairman of the Board of Directors of the Federal Reserve Bank of Dallas. | ||
DAVID J. LESAR, 51, Chairman of the Board, President and Chief Executive Officer of the Company, since 2000; President of the Company, 1997–2000; Executive Vice President and Chief Financial Officer, 1995–1997; joined Halliburton Company Board in 2000; Director of Lyondell Chemical Company and Mirant Corporation. | ||
J. LANDIS MARTIN, 59, Chairman and Chief Executive Officer, Titanium Metals Corporation (an integrated producer of titanium metals), since 1995; President, Titanium Metals Corporation, since 2000; President and Chief Executive Officer, NL Industries, Inc. (a manufacturer and marketer of titanium dioxide pigments), 1987–2003; Chairman of the Board and Chief Executive Officer, Baroid Corporation (and its predecessor), acquired by Dresser Industries, Inc. in 1994, 1990–1994; joined Halliburton Company Board in 1998; member of the Audit, the Health, Safety and Environment and the Management Oversight Committees; Director of Apartment Investment and Management Corporation and Crown Castle International Corporation. |
3
JAY A. PRECOURT, 67, Chairman of the Board and Chief Executive Officer, Scissor Tail Energy, LLC (a gatherer, transporter and processor of natural gas and natural gas liquids), since 2000; Chairman of the Board, Hermes Consolidated, Inc. (a gatherer, transporter and refiner of crude oil and refined products), since 1999; Vice Chairman and Chief Executive Officer, Tejas Gas Corporation, 1986–1999; President, Tejas Gas Corporation, 1996–1998; joined Halliburton Company Board in 1998; member of the Compensation, the Health, Safety and Environment and the Management Oversight Committees; Director of The Timken Company and Apache Corp. | ||
DEBRA L. REED, 48, President and Chief Operating Officer, Southern California Gas Company and San Diego Gas & Electric Company (regulated utility companies), since 2004; President and Chief Financial Officer, Southern California Gas Company and San Diego Gas & Electric Company, 2002–2004; President of San Diego Gas & Electric Company, 2000–2001; President, Energy Distribution Services, Southern California Gas Company, 1998–2001; Senior Vice President, Southern California Gas Company, 1995–1998; joined Halliburton Company Board in 2001; member of the Health, Safety and Environment, the Nominating and Corporate Governance and the Management Oversight Committees. |
Stock Ownership of Certain Beneficial Owners and Management
Name and Address of Beneficial Owner | Amount and Nature of Beneficial Ownership | Percent of Class(5) | ||
---|---|---|---|---|
Capital Research and Management Company 333 South Hope Street, Los Angeles, CA 90071 | 25,075,000(1) | 5.7% | ||
FMR Corp. 82 Devonshire Street, Boston, Massachusetts 02109 | 45,043,094(2) | 10.1% | ||
DII Industries, LLC Asbestos PI Trust 2716 Lee St., Suite 500, Greenville, TX 75401 | 59,500,000(3) | 11.8% | ||
Morgan Stanley 1585 Broadway, New York, New York 10036 | 24,505,978(4) | 5.5% |
(1) | Capital Research and Management Company (CRM) is an investment adviser and is deemed to be the beneficial owner of 25,075,000 shares. CRM has sole dispositive power over 25,075,000 shares. |
(2) | The number of shares reported includes 41,535,374 shares beneficially owned by Fidelity Management & Research Company, 2,590,325 shares owned by Fidelity Management Trust Company, 4,525 shares beneficially owned by Strategic Advisers, Inc. and 912,870 shares beneficially owned by Fidelity International Limited. FMR Corp. has sole dispositive power over 45,043,094 shares. FMR Corp. has sole power to vote or to direct the voting of 3,423,396 shares of common stock. |
(3) | DII Industries, LLC Asbestos PI Trust is deemed to be the beneficial owner of and has sole dispositive power over 59,500,000 shares. |
(4) | Morgan Stanley is the indirect beneficial owner of 24,505,978 shares held by its business units. Morgan Stanley has sole voting power and sole dispositive power over 23,984,502 shares and shared voting power and shared dispositive power over 42,308 shares. |
(5) | The percentage ownership reflected relates to the date of the report filed: as of December 31, 2004 in the case of Capital Research and Management Company and Morgan Stanley, as of January 20, 2005 in the case of DII Industries, LLC Asbestos PI Trust, and as of February 28, 2005 in the case of FMR Corp. |
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Amount and Nature of Beneficial Ownership | ||||||
---|---|---|---|---|---|---|
Name of Beneficial Owner or Number of Persons in Group | Sole Voting and Investment Power(1) | Shared Voting or Investment Power(2) | Percent of Class | |||
Albert O. Cornelison, Jr. | 125,567 | * | ||||
Robert L. Crandall | 10,800 | * | ||||
Kenneth T. Derr | 14,400 | * | ||||
Charles J. DiBona | 7,800 | * | ||||
C. Christopher Gaut | 156,515 | * | ||||
John W. Gibson, Jr. | 155,885 | * | ||||
W. R. Howell | 9,700 | * | ||||
Ray L. Hunt | 86,647 | 69,712(3) | * | |||
Andrew R. Lane | 132,889 | * | ||||
David J. Lesar | 1,788,725 | 20,000(3) | * | |||
Aylwin B. Lewis | 11,400 | * | ||||
J. Landis Martin | 36,001 | * | ||||
Mark A. McCollum | 21,167 | * | ||||
Jay A. Precourt | 27,640 | * | ||||
Debra L. Reed | 11,400 | 250(3) | * | |||
C. J. Silas | 9,800 | * | ||||
Shares owned by all current Directors and executive officers as a group (19 persons) | 2,820,764 | * |
* | Less than 1% of shares outstanding. |
(1) | Included in the table are shares of common stock that may be purchased pursuant to outstanding stock options within 60 days of March 1, 2005 for the following: Mr. Cornelison — 41,987; Mr. Crandall — 3,000; Mr. Derr — 7,000; Mr. DiBona — 3,000; Mr. Gaut — 77,647; Mr. Howell — 3,000; Mr. Hunt — 11,500; Mr. Lane — 32,556; Mr. Lesar — 994,240; Mr. Lewis — 7,000; Mr. Martin — 11,500; Mr. McCollum — 6,667; Mr. Precourt — 11,500; Ms. Reed — 7,000; Mr. Silas — 3,000 and three unnamed executive officers — 156,999. Until the options are exercised, these individuals will neither have voting nor investment power over the underlying shares of common stock but only have the right to acquire beneficial ownership of the shares through exercise of their respective options. |
(2) | The Halliburton Stock Fund is an investment fund established under the Halliburton Company Employee Benefit Master Trust to hold Halliburton common stock for some of Halliburton’s profit sharing, retirement and savings plans. The Fund held 6,815,537 shares of common stock at March 1, 2005. Two executive officers not named in the above table have beneficial interests in the Fund. Shares held in the Fund are not allocated to any individual’s account. The shares of common stock which might be deemed to be beneficially owned as of March 1, 2005 by the unnamed executive officers total 1,290. The Trustee, State Street Bank and Trust Company, votes shares held in the Halliburton Stock Fund in accordance with voting instructions from the participants. Under the terms of the plans, a participant has the right to determine whether up to 15% of his account balance in a plan is invested in the Halliburton Stock Fund. The Trustee, however, determines when sales or purchases are to be made. |
(3) | Mr. Hunt holds 69,712 shares as the trustee of trusts established for the benefit of his children. Mr. Lesar holds 20,000 shares in a family partnership. Ms. Reed has shared voting and investment power over 250 shares held in her husband’s Individual Retirement Account. |
5
CORPORATE GOVERNANCE
THE BOARD OF DIRECTORS
AND
STANDING COMMITTEES OF DIRECTORS
6
Members of the Committees of the Board of Directors
Audit Committee | Compensation Committee | Health, Safety and Environment | Management Oversight Committee | Nominating and Corporate Governance Committee | |
---|---|---|---|---|---|
Robert L. Crandall | X* | X | X | ||
Kenneth T. Derr | X | X* | X | X | |
Charles J. DiBona | X* | X | X | ||
W. R. Howell | X | X | X* | ||
Ray L. Hunt | X | X* | |||
Aylwin B. Lewis | X | X | X | ||
J. Landis Martin | X | X | X | ||
Jay A. Precourt | X | X | X | ||
Debra L. Reed | X | X | X | ||
C. J. Silas | X | X | X |
* | Chairman |
Audit Committee
• | recommending the appointment of the principal independent accountants to the Board of Directors, and together with the Board of Directors being responsible for the appointment, compensation, retention and oversight of the work of the principal independent accountants; |
• | reviewing the scope of the principal independent accountants’ examination and the scope of activities of the internal audit department; |
• | reviewing Halliburton’s financial policies and accounting systems and controls; |
• | reviewing audited financial statements and interim financial statements; |
• | preparing a report for inclusion in Halliburton’s proxy statement regarding the Audit Committee’s review of audited financial statements for the last fiscal year which includes a statement on whether it recommends that the Board include those financial statements in the Annual Report on Form 10-K; |
• | approving the services to be performed by the principal independent accountants; and |
• | reviewing and assessing the adequacy of the Audit Committee’s Charter annually and recommending revisions to the Board. |
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Compensation Committee
• | determining and approving the Chief Executive Officer’s (CEO) compensation level based on the evaluation of the CEO’s performance by the Management Oversight Committee in light of the goals and objectives set by these Committees; |
• | producing a compensation committee report on executive compensation as required by the SEC to be included in Halliburton’s annual proxy statement; |
• | taking part in an annual performance evaluation of the Compensation Committee; |
• | developing and approving an overall executive compensation philosophy, strategy and framework consistent with corporate objectives and stockholder interests; |
• | reviewing and approving all actions relating to compensation, promotion and employment-related arrangements for specified officers of Halliburton, its subsidiaries and affiliates; |
• | establishing performance criteria and reward schedules under Halliburton’s annual incentive pay plans and Performance Unit Program and certifying the performance level achieved and reward payments at the end of each plan year or three-year cycle; |
• | approving any other incentive or bonus plans applicable to specified officers of Halliburton, its subsidiaries and affiliates; |
• | administering awards under Halliburton’s 1993 Stock and Incentive Plan and its Supplemental Executive Retirement Plan; |
• | selecting an appropriate comparator group against which Halliburton’s total executive compensation program is measured; |
• | reviewing and approving or recommending to the Board, as appropriate, major changes to, and taking administrative actions associated with, any other forms of non-salary compensation under its purview; |
• | reviewing and approving the stock allocation budget among all employee groups within Halliburton; |
• | monitoring and reviewing periodically overall compensation program design and practice to ensure continued competitiveness, appropriateness and alignment with established philosophies, strategies and guidelines; |
• | reviewing and approving appointments to the Administrative Committee which oversees the day-to-day administration of certain non-qualified executive compensation plans; and |
• | retaining persons having special competence (including consultants and other third-party service providers) as necessary to assist the Committee in fulfilling its responsibilities and maintaining the sole authority to retain and terminate these persons, including the authority to approve fees and other retention terms. |
Health, Safety and Environment Committee
• | reviewing and assessing Halliburton’s health, safety and environmental policies and practices and proposing modifications or additions as needed; |
• | overseeing the communication and implementation of these policies throughout Halliburton; |
• | reviewing annually the health, safety and environmental performance of Halliburton’s operating units and their compliance with applicable policies and legal requirements; and |
• | identifying, analyzing and advising the Board on health, safety and environmental trends and related emerging issues. |
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Management Oversight Committee
• | evaluating the performance of the Chief Executive Officer; |
• | reviewing succession plans for senior management of Halliburton and its major operating units; |
• | evaluating management development programs and activities; and |
• | reviewing other internal matters of broad corporate significance. |
Nominating and Corporate Governance Committee
• | reviewing periodically the corporate governance guidelines adopted by the Board of Directors and recommending revisions to the guidelines as appropriate; |
• | developing and recommending to the Board for its approval an annual self-evaluation process of the Board and its committees. The Committee shall oversee the annual self-evaluations; |
• | reviewing and periodically updating the criteria for Board membership and evaluating the qualifications of each Director candidate against the criteria; |
• | assessing the appropriate mix of skills and characteristics required of Board members; |
• | identifying and screening candidates for Board membership; |
• | establishing procedures for stockholders to recommend individuals for consideration by the Committee as possible candidates for election to the Board; |
• | reviewing annually each Director’s continuation on the Board and recommending to the Board a slate of Director nominees for election at the Annual Meeting of Stockholders; |
• | recommending candidates to fill vacancies on the Board; |
• | reviewing periodically the status of each Director to assure compliance with the Board’s policy that at least two-thirds of Directors meet the definition of independent Director; |
• | reviewing the Board’s committee structure, and recommending to the Board for its approval Directors to serve as members and as Chairs of each committee; |
• | reviewing annually any stockholder proposals submitted for inclusion in Halliburton’s proxy statement and recommending to the Board any Halliburton statements in response; |
• | reviewing periodically Halliburton’s Director compensation practices, conducting studies and recommending changes, if any, to the Board; and |
• | reporting regularly on Committee activities and findings to the Board. |
• | as to each person the stockholder proposes to nominate for election or reelection as a Director: |
• | the name, age, business address and residence address of the person; |
• | the principal occupation or employment of the person; |
• | the class and number of shares of Halliburton common stock that are beneficially owned by the person; and |
• | all other information relating to the person that is required to be disclosed in solicitations for proxies for election of directors pursuant to Regulation 14A under the Securities Exchange Act of 1934, as amended; and |
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• | as to the stockholder giving the notice: |
• | the name and record address of the stockholder; and |
• | the class and number of shares of Halliburton common stock that are beneficially owned by the stockholder. |
• | personal characteristics: |
• | highest personal and professional ethics, integrity and values; |
• | an inquiring and independent mind; and |
• | practical wisdom and mature judgment; |
• | broad training and experience at the policy-making level in business, government, education or technology; |
• | expertise that is useful to Halliburton and complementary to the background and experience of other Board members, so that an optimum balance of members on the Board can be achieved and maintained; |
• | willingness to devote the required amount of time to carrying out the duties and responsibilities of Board membership; |
• | commitment to serve on the Board for several years to develop knowledge about Halliburton’s principal operations; |
• | willingness to represent the best interests of all stockholders and objectively appraise management performance; and |
• | involvement only in activities or interests that do not create a conflict with the Director’s responsibilities to Halliburton and its stockholders. |
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COMPENSATION COMMITTEE REPORT ON EXECUTIVE COMPENSATION
Overall Executive Compensation Philosophy and Strategy
• | emphasize operating performance drivers; and |
• | establish and maintain competitive executive compensation programs that enable Halliburton to attract, retain and motivate high caliber executives who will assure the long-term success of the business. |
• | specific peer companies within the energy services and engineering and construction industries; and |
• | selected companies from general industry having similar revenue size, number of employees and market capitalization and which, in our opinion, provide comparable references. |
• | a cash base salary; |
• | an annual incentive program; |
• | long-term incentive awards; and |
• | supplemental retirement and other executive benefits. |
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2004 Special Compensation-Related Considerations
• | 2003 capital structure and operational progress; |
• | positive stock market reaction to company strategy; |
• | impact of asbestos on 2003 incentive targets and subsequent awards; |
• | internal equity; and |
• | retention. |
Base Salary
• | level of responsibility; |
• | experience in current role and equitable compensation relationships among all Halliburton executives; |
• | performance; and |
• | external factors involving competitive positioning and general economic conditions. |
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Annual Incentive Plans
Long-Term Incentive Plans
• | reward consistent achievement of value creation and operating performance goals; |
• | align management with stockholder interests; and |
• | encourage long-term perspectives and commitment. |
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Supplemental Executive Retirement Plan
• | retirement benefits provided from other company programs; |
• | compensation; |
• | length of service; and |
• | years of service to normal retirement. |
Other Benefits and Perquisites
15
Policy Regarding Section 162(m) of the Internal Revenue Code
OF DIRECTORS*
Robert L. Crandall
W. R. Howell
Aylwin B. Lewis
Jay A. Precourt
C. J. Silas
* | The Compensation Committee is composed entirely of independent directors in accord with the New York Stock Exchange listing standards. |
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COMPARISON OF CUMULATIVE TOTAL RETURN
Total Stockholders’ Return — Five Years
Assumes Investment of $100 on December 31, 1999 and Reinvestment of Dividends
12/31/99 | 12/31/00 | 12/31/01 | 12/31/02 | 12/31/03 | 12/31/04 | ||||||
---|---|---|---|---|---|---|---|---|---|---|---|
Halliburton | 100 | 91.12 | 33.45 | 49.24 | 69.95 | 107.23 | |||||
S&P 500 | 100 | 90.89 | 80.08 | 62.39 | 80.28 | 89.02 | |||||
S&P Energy | 100 | 115.68 | 103.65 | 92.12 | 115.73 | 152.23 |
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SUMMARY COMPENSATION TABLE
Annual Compensation | Long-Term Compensation | ||||||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Awards | Payouts | ||||||||||||||||
Name and Principal Position | Year | Salary ($) | Bonus ($)(1) | Other Annual Compensation ($)(2) | Restricted Stock Awards ($)(3) | Securities Underlying Options/SARs (#) | LTIP Payouts ($)(4) | All Other Compensation ($)(5) | |||||||||
David J. Lesar | 2004 | 1,260,000 | 3,470,000 | 5,421,530 | 169,000 | 827,310 | 396,926 | ||||||||||
Chairman of the Board, President | 2003 | 1,200,000 | 1,008,333 | — | 0 | 0 | 1,956,563 | 426,528 | |||||||||
and Chief Executive Officer | 2002 | 1,100,000 | 1,719,972 | — | 4,482,368 | 0 | N/A | 448,678 | |||||||||
of the Company | |||||||||||||||||
Albert O. Cornelison, Jr. | 2004 | 500,000 | 875,000 | 1,305,433 | 44,940 | N/A | 234,085 | ||||||||||
Executive Vice President and | 2003 | 432,000 | 212,667 | — | 0 | 0 | N/A | 200,141 | |||||||||
General Counsel of the Company(6) | 2002 | N/A | N/A | — | N/A | 0 | N/A | N/A | |||||||||
C. Christopher Gaut | 2004 | 525,000 | 882,500 | 1,483,039 | 49,400 | N/A | 162,178 | ||||||||||
Executive Vice President and | 2003 | 416,667 | 100,000 | — | 615,000 | 100,000 | N/A | 136,667 | |||||||||
Chief Financial Officer of the | 2002 | N/A | N/A | — | N/A | N/A | N/A | N/A | |||||||||
Company(6) | |||||||||||||||||
John W. Gibson, Jr. | 2004 | 630,528 | 888,984 | 822,808 | 32,940 | N/A | 6,648,566 | ||||||||||
President and Chief Executive | 2003 | 600,000 | 352,917 | — | 0 | 0 | 303,801 | 241,556 | |||||||||
Officer of Halliburton Energy | 2002 | N/A | N/A | — | N/A | N/A | N/A | N/A | |||||||||
Services, Inc.(6) | |||||||||||||||||
Andrew R. Lane | 2004 | 365,015 | 300,000 | 1,566,812 | 26,920 | N/A | 119,300 | ||||||||||
Executive Vice President and | 2003 | N/A | N/A | — | N/A | N/A | N/A | N/A | |||||||||
Chief Operating Officer of | 2002 | N/A | N/A | — | N/A | N/A | N/A | N/A | |||||||||
the Company(6) | |||||||||||||||||
Mark A. McCollum | 2004 | 350,000 | 350,000 | 193,050 | 4,500 | N/A | 104,800 | ||||||||||
Senior Vice President and | 2003 | N/A | N/A | — | N/A | N/A | N/A | N/A | |||||||||
Chief Accounting Officer of | 2002 | N/A | N/A | — | N/A | N/A | N/A | N/A | |||||||||
the Company(6) |
(1) | The amounts disclosed include cash retention bonus payments made in 2003 for the 2002 Retention Awards for Messrs. Lesar, Cornelison and Gibson, and a signing bonus for Mr. Gaut. For 2004, the amounts include discretionary cash payments for Mr. Lesar — $950,000, Mr. Cornelison — $225,000, Mr. Gaut — $200,000, and Mr. Gibson — $305,000, as well as payments under the 2004 Annual Performance Pay Plan for Mr. Lesar — $2,520,000, Mr. Cornelison — $650,000, Mr. Gaut — $682,500, Mr. Gibson — $583,984, Mr. Lane — $209,000 and Mr. McCollum — $350,000. In recognition of his performance in 2004 the Board awarded Mr. Lane an additional bonus of $91,000. This award was paid in 2005. |
(2) | The dollar value of perquisites and other personal benefits for each of the named executive officers was less than established reporting thresholds. For security purposes and at the direction of the Board, Mr. Lesar utilizes a Company plane for all business and personal air travel. We believe the costs associated with this travel are a legitimate business expense, necessitated by our high public profile and due in part to threats against the Company, its operations and management. Because the costs of these services are incurred as a result of business-related concerns and are not perquisites maintained for the benefit of Mr. Lesar, the Company has not included such costs in the Other Annual Compensation column. Nonetheless, in the interest of transparency, we are disclosing the following incremental costs to the Company of Mr. Lesar’s use of Company planes for personal travel for 2004 — $117,974; 2003 — $135,726; and 2002 — $60,787. |
18
(3) | In 2002, Mr. Lesar was granted 308,810 shares with restrictions lapsing over 10 years. In 2003, Mr. Gaut was granted 30,000 shares with restrictions lapsing over 10 years. In 2004, each of the above individuals were granted shares with restrictions lapsing over 5 years, as follows: Mr. Lesar — 173,000; Mr. Cornelison — 44,110; Mr. Gaut — 48,710; Mr. Gibson — 31,610; Mr. Lane — 46,700; and Mr. McCollum — 5,000. Dividends are paid on the restricted shares. The total number and value of restricted shares held by each of the above individuals as of December 31, 2004 were as follows: |
Name | Total Restricted Shares | Aggregate Market Value | ||
---|---|---|---|---|
Mr. Lesar | 644,575 | 25,293,123 | ||
Mr. Cornelison | 67,114 | 2,633,553 | ||
Mr. Gaut | 75,710 | 2,970,860 | ||
Mr. Gibson | 120,267 | 4,719,277 | ||
Mr. Lane | 68,296 | 2,679,935 | ||
Mr. McCollum | 13,000 | 510,120 |
(4) | Payouts from the Performance Unit Program for the 2001 cycle that began on January 1, 2001 and ended on December 31, 2003 and the 2002 cycle that began on January 1, 2002 and ended on December 31, 2004. As a result of his termination, Mr. Gibson forfeited his participation in the 2002 cycle and did not receive a payout. |
(5) | “All Other Compensation” includes the following accruals for or contributions to various plans for the fiscal year ending December 31, 2004: (i) 401(k) plan matching contributions for Mr. Lesar — $8,200, Mr. Cornelison — $5,500, Mr. Gaut — $8,000, Mr. Gibson — $8,188, Mr. Lane — $5,240, and Mr. McCollum — $0; (ii) benefit restoration accruals for Mr. Lesar — $84,400, Mr. Cornelison — $23,600, Mr. Gaut — $25,600, Mr. Gibson — $0, Mr. Lane — $12,801, and Mr. McCollum — $11,600; (iii) supplemental executive retirement plan contributions for Mr. Lesar — $254,000, Mr. Cornelison — $188,000, Mr. Gaut — $120,000, Mr. Gibson — $0, Mr. Lane — $92,000, and Mr. McCollum — $85,000; (iv) above-market earnings on benefit restoration account for Mr. Lesar — $29,627, Mr. Cornelison — $8,785, Mr. Gaut — $378, Mr. Gibson — $2,065, Mr. Lane — $1,059, and Mr. McCollum — $0; and (v) above-market earnings on amounts deferred under elective deferral plans for Mr. Lesar — $12,499, Mr. Cornelison — $0, Mr. Gaut — $0, Mr. Gibson — $352, Mr. Lane — $0, and Mr. McCollum — $0. Additionally, for Mr. Gibson, the amount includes $1,250,000 in cash severance and $5,387,962 in restricted stock, which vested in accordance with the terms of his employment agreement. |
(6) | Mr. Cornelison became an executive officer on May 15, 2002; Mr. Gaut became an executive officer on March 3, 2003; Mr. Gibson became an executive officer on January 13, 2003 and ceased to be an executive officer on December 2, 2004; Mr. Lane became an executive officer on July 21, 2004; and Mr. McCollum became an executive officer on August 26, 2003. |
19
OPTION GRANTS FOR FISCAL 2004
Individual Grants(1) | ||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|
Name | Number of Securities Underlying Options Granted (#) | % of Total Options Granted to Employees in Fiscal Year | Exercise Price ($/Share) | Expiration Date | Grant Date Present Value $(2) | |||||||
David J. Lesar | 100,000 | 4.45 | 26.03 | 1/2/2014 | $ 1,192,149 | |||||||
69,000 | 3.07 | 38.61 | 12/2/2014 | 1,220,128 | ||||||||
Albert O. Cornelison, Jr. | 32,940 | 1.46 | 26.03 | 1/2/2014 | 392,694 | |||||||
12,000 | 0.53 | 38.61 | 12/2/2014 | 212,196 | ||||||||
C. Christopher Gaut | 32,940 | 1.46 | 26.03 | 1/2/2014 | 392,694 | |||||||
16,500 | 0.73 | 38.61 | 12/2/2014 | 291,770 | ||||||||
John W. Gibson, Jr. | 32,940 | 1.47 | 26.03 | 1/2/2014 | 392,694 | |||||||
Andrew R. Lane | 8,020 | 0.36 | 28.86 | 3/16/2014 | 106,005 | |||||||
18,900 | 0.84 | 38.61 | 12/2/2014 | 334,209 | ||||||||
Mark A. McCollum | 4,500 | 0.20 | 38.61 | 12/2/2014 | 79,574 | |||||||
All Optionees | 2,247,797 | 100.00 | 29.21 | (3) | (3) | 30,070,842 |
(1) | All options granted under the 1993 Plan are granted at the fair market value of the common stock on the grant date and generally expire ten years from the grant date. During employment, options vest over a three year period, with one-third of the shares becoming exercisable on each of the first, second and third anniversaries of the grant date. The options granted to designated executives are transferable by gift to individuals and entities related to the optionee, subject to compliance with guidelines adopted by the Compensation Committee. |
(2) | In previous years we have reported the value of options using the potential realizable value method in accordance with SEC rules. In anticipation of mandatory stock option expensing under SFAS No. 123R issued by the Financial Accounting Standards Board (FASB), we have elected to report the present value at grant date of awards made in 2004. These estimated hypothetical values are based on a Black-Scholes option pricing model in accordance with SEC rules. We used the following assumptions in estimating these values: expected option term, 5 years; risk-free rate of return, 3.65%; expected volatility, 54.30%; and expected dividend yield, 1.27%. |
(3) | The exercise price shown is an average of the price of all options granted in 2004. Options expire on one or more of the following dates: February 2, 2014, March 16, 2014, July 1, 2014, July 20, 2014, July 21, 2014, July 23, 2014, August 1, 2014, August 2, 2014, August 17, 2014, August 19, 2014, September 29, 2014, October 5, 2014, October 8, 2014, October 15, 2014, October 18, 2014, October 29, 2014, November 1, 2014, December 1, 2014, December 2, 2014, and December 15, 2014. |
AGGREGATED OPTION EXERCISES IN FISCAL 2004
AND DECEMBER 31, 2004 OPTION VALUES
Shares Acquired on Exercise (#) | Value Realized ($) | Number of Securities Underlying Unexercised Options at Fiscal Year-End (Shares) | Value of Unexercised In-the-Money Options at Fiscal Year-End ($) | ||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Name | Exercisable | Unexercisable | Exercisable | Unexercisable | |||||||||
David J. Lesar | 12,002 | 442,804 | 922,304 | 246,204 | 3,298,949 | 1,958,169 | |||||||
Albert O. Cornelison, Jr. | 0 | 0 | 29,038 | 48,877 | 157,504 | 472,973 | |||||||
C. Christopher Gaut | 0 | 0 | 33,334 | 116,106 | 624,679 | 1,694,853 | |||||||
John W. Gibson, Jr. | 119,970 | 4,704,528 | 50,500 | 0 | 0 | 0 | |||||||
Andrew R. Lane | 0 | 0 | 28,588 | 29,507 | 112,845 | 115,049 | |||||||
Mark A. McCollum | 0 | 0 | 6,667 | 17,833 | 99,405 | 201,630 |
20
Long-Term Incentive Compensation
LONG-TERM INCENTIVE PLANS — AWARDS IN FISCAL 2004
Estimated Future Payouts Under Non-Stock Price-Based Plans | ||||||||||
---|---|---|---|---|---|---|---|---|---|---|
Name | Performance Category January 1, 2004 Salary ($) | Performance Or Other Period Until Maturation or Payout | Threshold ($) | Target ($) | Maximum ($) | |||||
David J. Lesar | 1,260,000 | 2004–2006 | 945,000 | 1,890,000 | 3,780,000 | |||||
Albert O. Cornelison, Jr. | 500,000 | Fiscal Years | 187,500 | 375,000 | 750,000 | |||||
C. Christopher Gaut | 525,000 | 196,875 | 393,750 | 787,500 | ||||||
John W. Gibson, Jr.* | 625,000 | 234,375 | 468,750 | 937,500 | ||||||
Andrew R. Lane | 300,000 | 60,000 | 120,000 | 240,000 | ||||||
Mark A. McCollum | 350,000 | 70,000 | 140,000 | 280,000 |
* | Mr. Gibson was a participant in the Long-Term Incentive Plan until December 2, 2004 when all his opportunities for reward were forfeited upon his resignation. Numbers are shown by his name for information purposes only. |
EQUITY COMPENSATION PLAN INFORMATION
Plan category | Number of securities to be issued upon exercise of outstanding options, warrants and rights (a) | Weighted-average exercise price of outstanding options, warrants and rights (b) | Number of securities remaining available for future issuance under equity compensation plans (excluding securities reflected in column (a)) (c) | |||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|
Equity compensation plans approved by security holders | 18,506,660 | $31.48 | 25,763,789 | |||||||||
Equity compensation plans not approved by security holders | — | — | — | |||||||||
Total | 18,506,660 | $31.48 | 25,763,789 |
Note: | There are 923,558 shares with a weighted average exercise price of $37.18 to be issued upon exercise of outstanding options that were assumed in the 1998 Dresser merger, the 1996 Landmark acquisition and other business combinations. No further grants can be issued under these assumed plans. |
21
EMPLOYMENT CONTRACTS AND
CHANGE-IN-CONTROL ARRANGEMENTS
Employment Contracts
• | annual supplemental retirement benefit allocations under the Supplemental Executive Retirement Plan; and |
• | annual grants of stock options under Halliburton’s 1993 Stock and Incentive Plan, or 1993 Plan. |
• | the value of any restricted shares that are forfeited because of termination; and |
• | five times his annual base salary. |
• | the value of any restricted shares that are forfeited because of termination; |
• | two years’ base salary; |
22
• | any unpaid bonus earned in prior years; and |
• | any bonus payable for the year in which his employment is terminated determined as if he had remained employed for the full year. |
Change-In-Control Arrangements
• | any outstanding Options and Stock Appreciation Rights shall become immediately vested and fully exercisable; |
• | any restrictions on Restricted Stock Awards shall immediately lapse; |
• | all performance measures upon which an outstanding Performance Award is contingent shall be deemed achieved and the Holder shall receive a payment equal to the maximum amount of the Award he or she would have been entitled to receive, prorated to the Corporate Change Effective Date; and |
• | any outstanding cash Awards including, but not limited to, Stock Value Equivalent Awards, shall immediately vest and be paid based on the vested value of the award. |
• | in the event of a change-in-control during a plan year, a participant will be entitled to an immediate cash payment equal to the maximum dollar amount he or she would have been entitled to for the year, prorated through the date of the change-in-control; and |
• | in the event of a change-in-control after the end of a plan year but before the payment date, a participant will be entitled to an immediate cash payment equal to the incentive earned for the plan year. |
• | in the event of a change-in-control during a performance cycle, a participant will be entitled to an immediate cash payment equal to the maximum amount he or she would have been entitled to receive for the performance cycle, prorated to the date of the change-in-control; and |
• | in the event of a change-in-control after the end of a performance cycle but before the payment date, a participant will be entitled to an immediate cash payment equal to the incentive earned for that performance cycle. |
• | the purchase date for the outstanding stock purchase rights will be accelerated to a date fixed by the Compensation Committee prior to the effective date of the change-in-control; and |
• | on the effective date, any unexercised stock purchase rights will expire and Halliburton will promptly refund the unused amount of each participant’s payroll deductions. |
23
DIRECTORS’ COMPENSATION
Directors’ Fees and Deferred Compensation Plan
Directors’ Restricted Stock Awards
Directors’ Retirement Plan
24
Charitable Contributions
25
AUDIT COMMITTEE REPORT
• | reviewed and discussed Halliburton’s audited financial statements with management; |
• | discussed with KPMG LLP, Halliburton’s principal independent accountants, the matters required by Statement on Auditing Standards No. 61 relating to the conduct of the audit; |
• | received from KPMG LLP the written disclosures and letter required by Independence Standards Board Standard No. 1; and |
• | discussed with KPMG LLP its independence. |
• | review of the audited financial statements, |
• | discussions with management, |
• | discussions with KPMG LLP, and |
• | review of KPMG LLP’s written disclosures and letter, |
we recommended to the Board of Directors that the audited financial statements be included in Halliburton’s Annual Report on Form 10-K for the fiscal year ended December 31, 2004 for filing with the Securities and Exchange Commission. Our recommendation considers our review of that firm’s qualifications as independent accountants for the Company. Our review also included matters required to be considered under Securities and Exchange Commission rules on auditor independence, including the nature and extent of non-audit services. In our business judgment the nature and extent of non-audit services performed by KPMG LLP during the year did not impair the firm’s independence.
Kenneth T. Derr
W. R. Howell
J. Landis Martin
C. J. Silas
26
FEES PAID TO KPMG LLP
2004 (in millions) | 2003 (in millions) | |||||||
---|---|---|---|---|---|---|---|---|
Audit fees | $20.0 | $13.4 | ||||||
Audit-related fees | 1.4 | 1.2 | ||||||
Tax fees | 4.1 | 3.2 | ||||||
All other fees | 1.5 | 6.6 | ||||||
Total | $27.0 | $24.4 |
Audit Fees
Audit-Related Fees
Tax Fees
All Other Fees
Pre-Approval Policies and Procedures
Work Performed by KPMG’s Full Time, Permanent Employees
27
PROPOSAL FOR RATIFICATION OF THE SELECTION OF AUDITORS
(Item 2)
˜ ˜ ˜ ˜ ˜ ˜ ˜ ˜ ˜ ˜
28
STOCKHOLDER PROPOSAL ON SEVERANCE AGREEMENTS
(Item 3)
Proposal
Supporting Statement
29
The Board of Directors recommends a vote AGAINST this proposal. Halliburton’s statement in opposition is as follows:
˜ ˜ ˜ ˜ ˜ ˜ ˜ ˜ ˜ ˜
30
STOCKHOLDER PROPOSAL ON DIRECTOR ELECTION VOTE THRESHOLD
(Item 4)
Directors Election Majority Vote Standard Proposal
31
The Board of Directors recommends a vote AGAINST this proposal. Halliburton’s statement in opposition is as follows:
˜ ˜ ˜ ˜ ˜ ˜ ˜ ˜ ˜ ˜
32
ADDITIONAL INFORMATION
Advance Notice Procedures
Proxy Solicitation Costs
Stockholder Proposals for the 2006 Annual Meeting
OTHER MATTERS
MARGARET E. CARRIERE
Vice President and Secretary
March 22, 2005
33
Appendix A
CORPORATE GOVERNANCE GUIDELINES
Guidelines on Governance
Revised as of February 16, 2005
Operation of the Board — Meetings
• | leadership and vision; |
• | integrity; |
• | keeping the Board informed on matters affecting Halliburton and its operating units; |
• | performance of the business (including such measurements as total stockholder return and achievement of financial objectives and goals); |
• | development and implementation of initiatives to provide long-term economic benefit to Halliburton; |
• | accomplishment of strategic objectives; and |
• | development of management. |
A-1
Board Structure
• | has not been employed by Halliburton or its affiliate in the preceding three years and no member of the Director’s immediate family has been employed as an executive officer of Halliburton or its affiliate in the preceding three years; |
• | has not received, and does not have an immediate family member that has received for service as an executive officer of Halliburton, within the preceding three years, during any twelve-month period, more than $100,000 in direct compensation from Halliburton, other than director’s fees, committee fees or pension or deferred compensation for prior service; |
• | is not (A) a current partner of Halliburton’s independent auditor, (B) is not a current employee of Halliburton’s independent auditor and (C) was not during the past three calendar years a partner or employee of Halliburton’s independent auditor and personally worked on Halliburton’s audit; |
• | does not have an immediate family member who (A) is a current partner of Halliburton’s independent auditor, (B) is a current employee of Halliburton’s independent auditor who participates in that firm’s |
A-2
audit, assurance or tax compliance (but not tax planning) practice and (C) was during the past three calendar years, a partner or employee of Halliburton’s independent auditor and personally worked on Halliburton’s audit; |
• | has not been an employee of a customer or supplier of Halliburton or its affiliates and does not have an immediate family member who is an executive officer of such customer or supplier that makes payments to, or receives payments from, Halliburton or its affiliates in an amount which exceeds the greater of $1 million or 2% of such customer’s or supplier’s consolidated gross revenues within any of the preceding three years; |
• | has not been within the preceding three years part of an interlocking directorate in which the Chief Executive Officer or another executive officer of Halliburton serves on the compensation committee of another corporation that employs the Director, or an immediate family member of the Director, as an executive officer. |
• | Personal characteristics: |
• | highest personal and professional ethics, integrity and values; |
• | an inquiring and independent mind; and |
• | practical wisdom and mature judgment. |
• | Broad training and experience at the policy-making level in business, government, education or technology. |
• | Expertise that is useful to Halliburton and complementary to the background and experience of other Board members, so that an optimum balance of members on the Board can be achieved and maintained. |
• | Willingness to devote the required amount of time to carrying out the duties and responsibilities of Board membership. |
• | Commitment to serve on the Board for several years to develop knowledge about Halliburton’s principal operations. |
A-3
• | Willingness to represent the best interests of all stockholders and objectively appraise management performance. |
• | Involvement only in activities or interests that do not create a conflict with the Director’s responsibilities to Halliburton and its stockholders. |
A-4
Committees of the Board
A-5
Other Board Practices
A-6
Board of Directors
February 16, 2005
May 5, 2004
A-7
Appendix B
CORPORATE POLICY
SERVICES OF INDEPENDENT ACCOUNTANTS
PURPOSE:
GENERAL:
POLICY:
• | Audit; |
• | Audit-Related; |
• | Tax; and |
• | All Other. |
• | audit of financial statements that are filed with the SEC; |
• | quarterly reviews; |
• | statutory audits; |
• | comfort letters; |
• | consents; |
• | review of registration statements; |
• | Sarbanes-Oxley Section 404 attestations; |
• | accounting research for completed transactions; |
• | tax or information technology control assistance for Audit services; and |
• | such other services as the SEC may, from time to time, deem to constitute Audit services. |
B-1
• | employee benefit plan audits; |
• | due diligence assistance; |
• | accounting research on proposed transactions; |
• | assistance with regulatory matters involving the SEC and Public Company Accounting Oversight Board (“PCAOB”), environmental compliance, and project bidding or execution; and |
• | other audit or attest services required by regulatory authorities. |
• | preparation of original and amended tax returns, claims for refund and tax payment-planning services; |
• | tax planning and tax advice, which includes assistance with tax audits and appeals, tax advice relating to proposed transactions, employee benefit plans and requests for rulings or technical advice from taxing authorities; and |
• | global tax compliance and advisory services for expatriate employees. |
• | special investigations to assist the Audit Committee or its counsel; |
• | corporate secretarial services in foreign jurisdictions; and |
• | other services that can be performed for the Company by the Principal Independent Accountants which are allowed by the rules of the SEC and PCAOB and are specifically approved by the Audit Committee or the Committee Designee (as defined below). |
B-2
• | Audit fees; |
• | Audit-Related fees; |
• | Tax fees; and |
• | All Other fees. |
• | functioning in the role of management; |
• | auditing its own work; or |
• | serving in an advocacy role. |
• | bookkeeping or other services related to the accounting records or financial statements of the Company; |
• | financial information systems design and implementation; |
• | appraisal or valuation services, fairness opinions, or contribution-in-kind reports; |
• | actuarial services; |
• | internal audit outsourcing services; |
• | management functions or human resources; |
• | broker-dealer, investment adviser, or investment banking services; |
B-3
• | legal services; |
• | expert services unrelated to the audit; and |
• | any other service that the PCAOB or SEC determines, by regulation, is impermissible. |
• | lead partner for the audit; |
• | concurring partner for the audit; or |
• | any other member of the audit engagement team who provides more than ten hours of audit, review or attest services for the Company. |
March 15, 2004
May 7, 2003
Other References:
B-4
DIRECTIONS TO THE FOUR SEASONS HOTEL, HOUSTON, TEXAS
Heading South on I-45, from Bush Intercontinental Airport (IAH)/North Texas Area
Heading South on Hwy 59, from Bush Intercontinental Airport (IAH)
Heading East on Hwy 290, from Austin
Heading East on I-10, from Katy/San Antonio Areas
Heading West on I-10, from Beaumont/Louisiana Areas
Heading North on 288, from the Reliant Park Area
To vote in accordance with the Board of Directors’ recommendations just sign below; no boxes need to be checked. If no direction is made, this proxy will be Voted FOR Items 1 and 2 and Voted AGAINST Items 3 and 4. | Please Mark Here for Address Change or Comments | ¨ |
SEE REVERSE SIDE |
Directors Recommend a Vote FOR Item 1. | ||
Item 1 – ELECTION OF DIRECTORS. | ||
NOMINEES: | ||
01 R.L. Crandall | 06 D.J. Lesar | |
02 K.T. Derr | 07 J.L. Martin | |
03 S.M. Gillis | 08 J.A. Precourt | |
04 W.R. Howell | 09 D.L. Reed | |
05 R.L. Hunt |
FOR all nominees listed (except as marked to the contrary) | ¨ | WITHHOLD AUTHORITY to vote for all nominees listed | ¨ |
(Instruction: To withhold authority to vote for an individual nominee, write that nominee’s name on the space provided below.) | |||
Directors Recommend a Vote FOR Item 2. | ||||||
FOR | AGAINST | ABSTAIN | ||||
Item 2 – Proposal for Ratification of the Selection of Auditors. | ¨ | ¨ | ¨ |
Directors Recommend a Vote AGAINST Items 3 and 4. | ||||||
FOR | AGAINST | ABSTAIN | ||||
Item 3 – Stockholder Proposal on Severance Agreements. | ¨ | ¨ | ¨ | |||
FOR | AGAINST | ABSTAIN | ||||
Item 4 – Stockholder Proposal on Director Election Vote Threshold. | ¨ | ¨ | ¨ |
Item 5 – IN THEIR DISCRETION, UPON SUCH OTHER BUSINESS AS MAY PROPERLY COME BEFORE THE MEETING. | ||
YES | ||
I PLAN TO ATTEND THE MEETING | ¨ |
Signature | Signature | Date | ||||||||||
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Vote by Internet or Telephone or Mail
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PROXY
HALLIBURTON COMPANY
PROXY FOR 2005 ANNUAL MEETING OF STOCKHOLDERS
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS
The undersigned hereby appoints D.J. Lesar, A.O. Cornelison, Jr. and M.E. Carriere, and any of them, proxies or proxy with full power of substitution and revocation as to each of them, to represent the undersigned and to act and vote, with all powers which the undersigned would possess if personally present, at the Annual Meeting of Stockholders of Halliburton Company to be held at the Four Seasons Hotel, 1300 Lamar Street, Houston, Texas, on Wednesday, May 18, 2005, on the following matters and in their discretion on any other matters which may come before the meeting or any adjournments thereof. Receipt of Notice-Proxy Statement dated March 22, 2005, is acknowledged. | |
This proxy when properly executed will be voted in the manner directed herein by the undersigned. | |
In the absence of such direction the proxy will be voted FOR the nominees listed in Item 1, FOR the Proposal set forth in Item 2 and AGAINST the Proposals set forth in Items 3 and 4. |
(Continued and to be signed on reverse side)
5 FOLD AND DETACH HERE 5
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