(Name of Registrant as Specified In Its Charter)

(Name of Person(s) Filing Proxy Statement, if other than the Registrant)

March 21, 2006

To Our Stockholders:

      You are cordially invited to attend the Annual Meeting of Stockholders of Halliburton Company. The meeting will be held on Wednesday, May 17, 2006, at 9:00 a.m., local time, at the Simmons Center, 800 Chisholm Trail Parkway, Duncan, Oklahoma 73534. The Notice of Annual Meeting, proxy statement and proxy card from the Board of Directors are enclosed. The materials provide further information concerning the Annual Meeting.

      At the meeting, stockholders are being asked to:

Please refer to the proxy statement for detailed information on each of these proposals.

      It is very important that your shares are represented and voted at the meeting. Your shares may be voted electronically on the Internet, by telephone or by returning the enclosed proxy card. If you attend the meeting, you may vote in person even if you have previously voted. We would appreciate you informing us on the proxy card if you expect to attend the meeting so that we can provide adequate seating.

      The continuing interest of our stockholders in the business of Halliburton is appreciated, and we hope you will be able to attend the Annual Meeting.

Notice of Annual Meeting of Stockholders

to be Held May 17, 2006

       The Annual Meeting of Stockholders of Halliburton Company, a Delaware corporation, will be held on Wednesday, May 17, 2006, at 9:00 a.m., local time, at the Simmons Center, 800 Chisholm Trail Parkway, Duncan, Oklahoma 73534. At the meeting, the stockholders will be asked to consider and act upon the matters discussed in the attached proxy statement as follows:

      These items are fully described in the following pages, which are made a part of this Notice. The Board of Directors has set Monday, March 20, 2006, at the close of business, as the record date for the determination of stockholders entitled to notice of and to vote at the meeting and at any adjournment of the meeting.

      We request that you vote your shares as promptly as possible. You may vote your shares in a number of ways if you have shares registered in your own name:

      If you hold Halliburton shares with a broker or bank, you may also be eligible to vote via the Internet or by telephone if your broker or bank participates in the proxy voting program provided by ADP Investor Communication Services.

IF YOU PLAN TO ATTEND:

      Attendance at the meeting is limited to stockholders and one guest each. Admission will be on a first-come, first-served basis. Registration will begin at 8:00 a.m., and the meeting will begin at 9:00 a.m. Each stockholder holding stock in brokerage accounts will need to bring a copy of a brokerage statement reflecting stock ownership as of the record date. Please note that you may be asked to present valid picture identification, such as a driver’s license or passport.

March 21, 2006

      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

PROXY STATEMENT

GENERAL INFORMATION

      The accompanying proxy is solicited by the Board of Directors of Halliburton Company (“Halliburton”, the “Company”, “we” or “us”). By executing and returning the enclosed proxy or by following the enclosed voting instructions, you authorize the persons named in the proxy to represent you and vote your shares on the matters described in the Notice of Annual Meeting.

      Subject to space availability, all stockholders as of the record date, or their duly appointed proxies, may attend the Meeting and each may be accompanied by one guest. Admission to the Meeting will be on a first-come, first-served basis. Registration will begin at 8:00 a.m., and the Meeting will begin at 9:00 a.m. Please note that you may be asked to present valid picture identification, such as a driver’s license or passport when you check in at the registration desk.

      If you hold your shares in “street name” (that is, through a broker or other nominee), you will need to bring a copy of a brokerage statement reflecting your stock ownership as of the record date.

      No cameras, recording equipment, electronic devices, large bags, briefcases or packages will be permitted in the Meeting.

      If you attend the Meeting, you may vote in person. If you are not present, your shares can be voted only if you have followed the instructions for voting via the Internet or by telephone or returned a properly executed proxy; and in these cases, your shares will be voted as you specify. If no specification is made, the shares will be voted in accordance with the recommendations of the Board of Directors. You may revoke the authorization given in your proxy at any time before the shares are voted at the Meeting.

      The record date for determination of the stockholders entitled to vote at the Annual Meeting is the close of business on March 20, 2006. Halliburton’s common stock, par value $2.50, is the only class of capital stock that is outstanding. As of March 20, 2006, there were 516,358,189 shares of common stock outstanding. Each of the outstanding shares of common stock is entitled to one vote on each matter submitted to the stockholders for a vote at the Meeting. A complete list of stockholders entitled to vote will be kept at our offices at the address specified below for ten days prior to, and will be available at, the Annual Meeting.

      Votes cast by proxy or in person at the Annual Meeting will be counted by the persons appointed by us to act as election inspectors for the Meeting. Except as set forth below, the affirmative vote of the majority of shares present in person or represented by proxy at the Meeting and entitled to vote on the subject matter will be the act of the stockholders. Shares for which a holder has elected to abstain on a matter will count for purposes of determining the presence of a quorum and will have the effect of a vote against the matter.

      In the election of Directors, the candidates for election receiving the highest number of affirmative votes of the shares entitled to be voted, whether or not a majority of the shares present, up to the number of Directors to be elected by those shares, will be elected. Shares present but not voting on the election of Directors will be disregarded, except for quorum purposes, and will have no legal effect. With respect to the proposal to amend the Certificate of Incorporation to increase the number of authorized shares, the affirmative vote of the holders of a majority of the outstanding shares of common stock is required to approve the amendment.

      The election inspectors will treat shares held in street name which cannot be voted by a broker on specific matters in the absence of instructions from the beneficial owner of the shares, known as broker non-vote shares, as shares that are present and entitled to vote for purposes of determining the presence of a quorum. In determining the outcome of any matter for which the broker does not have discretionary authority to vote, however, those shares will not have any effect on that matter. Those shares may be entitled to vote on other matters.

      In accordance with our confidential voting policy, no vote of any stockholder will be disclosed to Halliburton’s officers, Directors or employees, except:

      The proxy solicitor, the election inspectors and the tabulators of all proxies, ballots and voting tabulations that identify stockholders are independent and are not employees of Halliburton.

      This proxy statement, the form of proxy and voting instructions are being sent to stockholders on or about April 24, 2006. Our Annual Report to Stockholders, including financial statements, for the fiscal year ended December 31, 2005 accompanies this proxy statement. The Annual Report is not to be considered as a part of the proxy solicitation material or as having been incorporated by reference.

      Our principal executive office is located at 5 Houston Center, 1401 McKinney Street, Suite 2400, Houston, Texas 77010.

ELECTION OF DIRECTORS

(Item 1)

      Effective at 9:00 a.m. on May 17, 2006, the number of Directors which will constitute the Board will be increased from nine to eleven. Eleven Directors are to be elected to serve for the ensuing year and until their successors are elected and qualify. Nine of the nominees listed below are presently Directors of Halliburton. Alan M. Bennett and James R. Boyd are proposed for the first time for election to the Board of Directors. The common stock represented by the proxies will be voted for the election as Directors of the eleven nominees unless we receive contrary instructions. If any of the nominees are unwilling or unable to serve, favorable and uninstructed proxies will be voted for a substitute nominee designated by the Board of Directors. If a suitable substitute is not available, the Board of Directors will reduce the number of Directors to be elected. Each nominee has indicated approval of his or her nomination and his or her willingness to serve if elected.

Information about Nominees for Director

Stock Ownership of Certain Beneficial Owners and Management

      The following table sets forth information about persons or groups, based on information contained in Schedules 13G filed with the Securities and Exchange Commission reflecting beneficial ownership, who own or have the right to acquire more than five percent of our common stock.

     The following table sets forth, as of March 1, 2006, the amount of our common stock owned beneficially by each Director, each Director Nominee, each of the executive officers named in the Summary Compensation Table on page 20 and all Directors, Director Nominees and executive officers as a group.

CORPORATE GOVERNANCE

      In 1997, our Board of Directors adopted a formal statement of its responsibilities and corporate governance guidelines to ensure effective governance in all areas of its responsibilities. Since 1997, our corporate governance guidelines have been reviewed periodically and revised as appropriate to reflect the dynamic and evolving processes relating to corporate governance, including the operation of the Board. Our Board’s corporate governance guidelines, as revised in December 2005, can be found on the Corporate Governance page of our website www.halliburton.com and in Appendix A to this proxy statement.

      Our Board also wants our stockholders to understand how the Board conducts its affairs in all areas of its responsibility. The full text of our Audit; Compensation; Health, Safety and Environment; Management Oversight; and Nominating and Corporate Governance Committees’ charters are available on our website. The Compensation Committee charter was revised in December 2005 and is included as Appendix B to this proxy statement.

      We have posted on our website our Code of Business Conduct, which applies to all of our employees and Directors and serves as a code of ethics for our principal executive officer, principal financial officer, principal accounting officer or controller, and other persons performing similar functions. If you do not have access to our website you can request a hard copy of the Code of Business Conduct, our corporate governance guidelines and the charters of the Board’s committees by contacting the Senior Vice President and Secretary at the address set forth on page 2 of this proxy statement. Any waivers to our code of ethics for our executive officers can only be made by our Audit Committee.

THE BOARD OF DIRECTORS AND

STANDING COMMITTEES OF DIRECTORS

      The Board of Directors has standing Audit; Compensation; Health, Safety and Environment; Management Oversight; and Nominating and Corporate Governance Committees. Each of the standing committees are comprised of non-employee Directors, and the Audit; Compensation; and Nominating and Corporate Governance Committees, are comprised, in the business judgment of the Board entirely of independent, non-employee Directors. The Board has made the determination that each of the non-employee Directors, except for Mr. Hunt, is independent because they meet the independence standards set forth in our corporate governance guidelines (see Appendix A). For more information on Mr. Hunt, please see Certain Relationships and Related Transactions in this proxy statement on page 25. The Board of Directors has determined that Mr. Crandall’s service on the audit committees of more than three public companies does not impair his ability to serve on Halliburton’s Audit Committee. During the last fiscal year, the Board of Directors met on 6 occasions, the Audit Committee met on 9 occasions, the Compensation Committee met on 5 occasions, the Health, Safety and Environment Committee met on 2 occasions, the Management Oversight Committee met on 5 occasions and the Nominating and Corporate Governance Committee met on 2 occasions. The non-employee Directors of the Board and the Management Oversight Committee each met in executive session, with no Company personnel present, on 5 occasions. Mr. W.R. Howell is our Lead Director, and in that capacity, he chairs the executive sessions of the Management Oversight Committee. All members of the Board attended at least 75 percent of the total number of meetings of the Board and the committees on which he or she served during the last fiscal year. Our corporate governance guidelines provide that all Directors should attend our Annual Meeting, and all of our Directors attended the 2005 Meeting.

      To foster better communication with our stockholders, we established a process for stockholders to communicate with the Audit Committee and the Board of Directors. The process has been approved by both the Audit Committee and the Board, and meets the requirements of the New York Stock Exchange, or NYSE, and the Securities and Exchange Commission, or SEC. The methods of communication with the Board, which follow, include mail, a dedicated telephone number and an e-mail address.

Contact the Board

      One may choose one of the below listed options to report complaints about Halliburton’s accounting, internal accounting controls or auditing matters to the Audit Committee, or other concerns to the Board of Directors.

      Halliburton’s Director of Business Conduct, a Halliburton employee, reviews all stockholder communications directed to the Audit Committee and the Board of Directors. The Chairman of the Audit Committee is promptly notified of any significant communication involving accounting, internal accounting controls, or auditing matters. The Chairman of the Management Oversight Committee is promptly notified of any other significant stockholder communications and communications addressed to a named Director are promptly sent to the Director. A report summarizing all communications is sent to each Director quarterly and copies of communications are available for review by any Director.

      Information regarding these methods of communication is also on our website, www.halliburton.com, under “Corporate Governance”.

Members of the Committees of the Board of Directors

Audit Committee

      The Audit Committee’s role is one of oversight, while Halliburton’s management is responsible for preparing financial statements. The independent accounting firm appointed to audit our financial statements (the “principal independent accountants”) is responsible for auditing those financial statements. The Audit Committee is not providing any expert or special assurance as to Halliburton’s financial statements or any professional certification as to the principal independent accountants’ work. The following functions are the key responsibilities of the Audit Committee in carrying out its oversight:

      The Audit Committee also reviews Halliburton’s compliance with its Code of Business Conduct which was formally adopted by the Board in 1992. The Audit Committee meets separately with the principal independent accountants, internal auditors and management to discuss matters of concern, and to receive recommendations or suggestions for change and to exchange relevant views and information.

Compensation Committee

      The primary function of the Compensation Committee is to ensure that the Company’s compensation program is effective in attracting, retaining and motivating key employees, that it reinforces business strategies and objectives for enhanced stockholder value and that the program is administered in a fair and equitable manner consistent with established policies and guidelines.

      The Compensation Committee’s responsibilities include, but are not limited to:

Health, Safety and Environment Committee

      The Health, Safety and Environment Committee’s responsibilities include, but are not limited to:

Management Oversight Committee

      The Management Oversight Committee’s responsibilities include, but are not limited to:

Nominating and Corporate Governance Committee

      The Nominating and Corporate Governance Committee’s responsibilities include, but are not limited to:

      Stockholder Nominations of Directors. Nominations by stockholders may be made at an Annual Meeting of Stockholders in the manner provided in our By-laws. The By-laws provide that a stockholder entitled to vote for the election of Directors may make nominations of persons for election to the Board at a meeting of stockholders by complying with required notice procedures. Nominations shall be made pursuant to written notice to the Senior Vice President and Secretary at the address set forth on page 2 of this proxy statement, and must be received at our principal executive offices not less than ninety (90) days prior to the anniversary date of the immediately preceding Annual Meeting of Stockholders. The notice shall set forth:

      The proposed nominee may be required to furnish other information as Halliburton may reasonably require to determine the eligibility of the proposed nominee to serve as a Director. At any meeting of stockholders, the presiding officer may disregard the purported nomination of any person not made in compliance with these procedures.

      Qualifications of Directors. Candidates nominated for election or reelection to the Board of Directors should possess the following qualifications:

      The Nominating and Corporate Governance Committee is responsible for assessing the appropriate mix of skills and characteristics required of Board members in the context of the needs of the Board at a given point in time and shall periodically review and update the criteria. Diversity in personal background, race, gender, age and nationality for the Board as a whole may be taken into account in considering individual candidates.

      Process for the Selection of New Directors. The Board is responsible for filling vacancies on the Board. The Board has delegated to the Nominating and Corporate Governance Committee the duty of selecting and recommending prospective nominees to the Board for approval. The Nominating and Corporate Governance Committee considers suggestions of candidates for Board membership made by current Committee and Board members, Halliburton management, and stockholders. The Committee may retain an independent executive search firm to identify candidates for consideration. The Committee retained the executive search firm, Korn/ Ferry International, to assist its search in identifying and evaluating Director nominees, and this search firm identified Messrs. Bennett and Boyd as potential candidates. A stockholder who wishes to recommend a prospective candidate should notify Halliburton’s Senior Vice President and Secretary, as described in this proxy statement.

      When the Nominating and Corporate Governance Committee identifies a prospective candidate, the Committee determines whether it will carry out a full evaluation of the candidate. This determination is based on the information provided to the Committee by the person recommending the prospective candidate, and the Committee’s knowledge of the candidate. This information may be supplemented by inquiries to the person who made the recommendation or to others. The preliminary determination is based on the need for additional Board members to fill vacancies or to expand the size of the Board, and the likelihood that the candidate will meet the Board membership criteria listed above. The Committee will determine, after discussion with the Chairman of the Board and other Board members, whether a candidate should continue to be considered as a potential nominee. If a candidate warrants additional consideration, the Committee may request an independent executive search firm to gather additional information about the candidate’s background, experience and reputation, and to report its findings to the Committee. The Committee then evaluates the candidate and determines whether to interview the candidate. Such an interview would be carried out by one or more members of the Committee and others as appropriate. Once the evaluation and interview are completed, the Committee recommends to the Board which candidates should be nominated. The Board makes a determination of nominees after review of the recommendation and the Committee’s report.

COMPENSATION COMMITTEE REPORT ON EXECUTIVE COMPENSATION

      Halliburton seeks to enhance the Company’s value by providing a broad spectrum of high quality services and related products within the energy services and engineering and construction business segments in which Halliburton operates. We believe that Halliburton’s total compensation package for executives should emphasize compensation plans that are linked to measures of both absolute and relative performance.

      Our charter makes us responsible for overseeing Halliburton’s overall compensation philosophy and objectives and gives us specific responsibility for reviewing, approving and monitoring the compensation program for senior executives of Halliburton and its operating groups. Our principal role is to ensure that Halliburton’s compensation program is effective in attracting, retaining and motivating key talent, that it reinforces business strategies and objectives consistent with the Company’s goals and that it is administered in a fair and equitable manner consistent with established policies and guidelines.

OVERALL EXECUTIVE COMPENSATION PHILOSOPHY AND STRATEGY

Objectives

      The primary objectives of Halliburton’s total compensation package for senior executives are to:

      Halliburton’s compensation program is designed and regularly reviewed to ensure that the program’s components support Halliburton’s strategies and motivate employees to achieve business success and generate value for our shareholders.

Setting Compensation

      In determining what we deem to be appropriate types and amounts of compensation for executives, we consult with outside compensation consultants and review compensation data obtained from independent sources.

      In the design and administration of executive compensation programs, we generally target current market levels of compensation at the 50th percentile for good performance and between the 50th and 75th percentile competitive level for outstanding performance. In doing so, we consider the market data for a comparator group which reflects the markets in which Halliburton competes for business and people. The comparator group is composed of:

      Raw data is reviewed and regression analysis is used in assessing market compensation data to provide appropriate comparisons based on company size, complexity and performance, and individual role and job content. A consistent present value methodology is used in assessing stock-based and other long-term incentive awards.

      The focus and mix of executive compensation components and opportunities are tailored by individual position to reflect an appropriate balance among fixed and variable pay, short and long-term focus, and business/organization unit or corporate accountability.

Components of Compensation

      Halliburton’s executive compensation program is managed from a total compensation perspective with consideration given to each component of the total package. Our executive compensation program consists of:

      A.    a cash base salary;

      B.    annual (short-term) incentives;

      C.    long-term incentives;

      D.    supplemental retirement; and

      E.    other executive benefits.

      Executive salaries are referenced to market data for comparable positions within the comparator group. In addition to considering market comparisons in making salary decisions, we exercise discretion and judgment based on the following factors:

      No specific formula is applied to determine the weight of each factor. Annual salary reviews are conducted each year to evaluate the individual performance of executives, however, individual salaries are not necessarily adjusted each year.

      The base salary for Mr. Cornelison did not increase during 2005. Messrs. Gaut and McCollum received base pay adjustments of 5% or less. Mr. Lane’s pay was increased to $650,000 in 2005 in recognition of his promotion to Chief Operating Officer. Overall, adjustments to executive salaries made in 2005 were minimal except those recognizing promotions, significant changes in job responsibilities or where an executive’s pay was considerably lower than market data at the 50th percentile.

      In 1995, we established the Annual Performance Pay Plan to provide a means to link total compensation to Halliburton’s performance, as measured by cash value added, or CVA. CVA measures the difference between after tax cash income and a capital charge, based upon Halliburton’s weighted average cost of capital, to determine the amount of value, in terms of cash flow, added to Halliburton’s business. Since the inception of the Plan, CVA has provided a close correlation to total shareholder return, notwithstanding the reduced stock price which occurred from 2002-2004 as a result of Halliburton’s asbestos-related issues during that time. Since the conclusion of the asbestos settlement our stock has reacted positively, demonstrating the viability of CVA as an astute proxy for total shareholder return.

      At the beginning of each plan year, we establish a reward schedule that aligns given levels of CVA performance beyond a threshold level with reward opportunities. Reward opportunities are established at target and maximum levels. The maximum amount any participant can receive under the Plan is capped at two times the target opportunity level. The level of achievement of annual CVA performance determines the dollar amount of incentive compensation payable to participants.

      Officers of Halliburton and its business units and specific senior managers were eligible to participate in the Annual Performance Pay Plan during 2005. In 2005, consolidated CVA performance exceeded the maximum level due to the exceptional performance of both the Energy Services Group and KBR. Accordingly, the Named Executive Officers earned annual incentive compensation for the year in the amounts shown in the Summary Compensation Table.

      Halliburton uses long-term incentives to achieve the following objectives:

      Our 1993 Stock and Incentive Plan (the “1993 Plan”) provides for a variety of cash and stock-based awards, including stock options, restricted stock, and performance shares, among others. Under the 1993 Plan, we may, in our discretion, select from among these types of awards to establish individual long-term incentive awards.

      In 2005 we continued our strategy of using a combination of vehicles to meet our long-term incentive objectives. These included restricted stock and performance units as well as stock options. The appropriate mix was determined based on level within the organization. At the executive level, we placed particular emphasis on operations-based incentives, such as performance units, in addition to stock options and restricted stock.

      By granting a mix of long-term incentives, the Company expects to effectively address volatility in our industry and in the stock market — sustaining more value and preserving an incentive to meet performance goals. In addition to assuring judicious use of Company shares, we believe that this strategy will also achieve enhanced shareholder value through performance goals that use operating performance as the primary measure of success.

      Our determination of the size of equity-based grants to executive officers are based on market references to long-term incentive compensation for comparable positions within the comparator group and on our subjective assessment of organizational roles and internal job relationships. In 2005, the Named Executive Officers received stock options, restricted stock awards and performance unit awards as listed in the applicable Compensation Tables.

      The Performance Unit Program is a long-term program designed to provide key executives with specified incentive opportunities contingent on the level of achievement of pre-established corporate performance objectives. The 2005 cycle began on January 1, 2005, and will end on December 31, 2007 (the “2005 Cycle”). Performance is measured by Halliburton Company consolidated Return on Capital Employed (“ROCE”) compared to both absolute goals and relative goals, as measured by the results achieved by comparator companies. Individual incentive opportunities are established based on market references. The Program allows for rewards to be paid in cash, stock or a combination thereof.

      The 2003 cycle officially ended on December 31, 2005. Results for this cycle of the Program included the achievement of performance beyond the Challenge level on absolute measures and in between Plan and Challenge levels on relative measures. Reward amounts earned by applicable Named Executive Officers are listed in the Summary Compensation Table. Rewards for the 2003 cycle were paid in cash.

      The Supplemental Executive Retirement Plan was established to provide retirement benefits to key executives. Determinations as to who will receive an allocation for a particular plan year and the amount of the allocation are made in our sole discretion. However, in making our determinations, we consider guidelines that include references to:

      Contributions are allocated with a goal of achieving a 75% base pay replacement assuming retirement at age 65 with 25 or more years of service. In 2005, a vesting provision was added to the Plan requiring five

consecutive years of Plan participation in order for awards made in 2005 and forward and the associated account balances to be fully vested.

      In 2005, we authorized retirement allocations under the terms of the Plan to Messrs. Lesar, Lane, Gaut, Cornelison, and McCollum as listed in Footnote 5 to the Summary Compensation Table.

      The Halliburton Elective Deferral Plan was established in 1995 to provide highly compensated employees with an opportunity to defer earned base salary and incentive compensation in order to help meet retirement and other future income needs. The Plan is a nonqualified deferred compensation plan and participation is completely voluntary. Pre-tax deferrals of up to 75% of base salary and/or incentive compensation are allowed each calendar year. Interest is credited based upon the participant’s election from among four (4) benchmark investment options. In 2005, Mr. Gaut participated in the Plan by deferring a percentage of his incentive compensation. No other Named Executive Officers participated in the Plan in 2005.

      The Halliburton Company Benefit Restoration Plan exists to provide a vehicle to restore qualified plan benefits which are reduced as a result of limitations imposed under the Internal Revenue Code or due to participation in other company sponsored plans. It also serves to defer compensation that would otherwise be treated as excessive employee remuneration within the meaning of Section 162(m) of the Internal Revenue Code. The Plan is a nonqualified deferred compensation plan that earns interest at the rate of 10% per annum. In 2005, the Named Executive Officers received awards under the Plan in the amounts shown in the footnotes to the Summary Compensation Table.

      Halliburton makes limited use of perquisites for executives. Historically, the value of perquisites offered to executives has not exceeded $50,000 in any given year.

      Our executives do not have company cars or car allowances and their health care and insurance coverage is the same as that provided to all active employees. Club memberships are limited and provided on an as-needed basis for business purposes only.

      A taxable benefit for executive financial planning is provided and ranges from $5,000 to a maximum of $15,000 per year. This benefit does not include tax return preparation. It is paid, only if used by the executive, on a reimbursable basis. Because Halliburton values the health and welfare of its executives, a physical examination is provided to eligible executives annually.

      The company also provides for adequate security measures at the personal residences of Messrs. Lesar and Lane.

2005 SPECIAL COMPENSATION-RELATED CONSIDERATIONS

      In early 2005, the Company successfully finalized the asbestos global settlement. Reaching this historical achievement required a tremendous amount of effort and sacrifice on the part of the employees who worked diligently over the last 3 years orchestrating and implementing this uniquely creative and complicated strategy. In recognition of their performance, the Committee approved discretionary cash payments totaling $5,466,000 to 36 employees. This amount includes payments to Messrs. Gaut Cornelison, and McCollum as indicated in the footnotes to the Summary Compensation Table. In lieu of a cash payment, the Committee granted, Mr. Lesar an option to purchase 100,000 shares of Halliburton Company common stock — a further indication of the Committee’s intent to link rewards to the long-term performance of the Company and ensure continued focus on shareholder value. No other discretionary payments were made to the Named Executive Officers in 2005.

COMPENSATION FOR THE CHAIRMAN OF THE BOARD, PRESIDENT AND

CHIEF EXECUTIVE OFFICER

      Mr. Lesar has been the Chairman of the Board, President and Chief Executive Officer since August 2000. His performance is reviewed annually in December by the Management Oversight Committee, which is chaired by the Lead Director. The results of this performance review are used by the Compensation Committee when making recommendations regarding the CEO’s total compensation package to the full Board for approval.

      The CEO participates in the same programs and receives compensation based upon the same criteria as other executive officers, consistent with our Executive Compensation Philosophy and Strategy. For 2005, the compensation components for Mr. Lesar included:

      Base Salary: Mr. Lesar’s base salary is determined based on individual performance and competitive market data relative to Chief Executive Officers of industry competitors and selected other general industry companies of similar size and scope. The Committee did not adjust Mr. Lesar’s base pay in 2005.

      Annual Incentive: The Committee established Mr. Lesar’s incentive criteria in the first quarter of 2005 based on Halliburton Company consolidated CVA results and set his target and maximum levels of opportunity under the Performance Pay Plan at 110% and 220% of base salary, respectively. As a result of the Company’s record performance, Mr. Lesar earned an incentive award equal to his maximum opportunity level of $2,772,000 in 2005.

      Long-term Incentives: In accordance with our long-term incentive strategy previously discussed and consistent with other executives, Mr. Lesar’s long-term incentive opportunity consists of a combination of restricted stock, stock options and performance units granted under the Company’s 1993 Plan. In 2005, Mr. Lesar was awarded 80,000 restricted shares and an option to purchase 90,000 shares of Company stock in addition to a target opportunity of $2,500,000 under the Performance Unit Program. He also received a special stock option award in 2005 recognizing his contribution to the global asbestos settlement as previously detailed.

      Supplemental Executive Retirement Plan: Under the terms of the Plan, a 2005 supplemental retirement award was approved for Mr. Lesar in the amount of $251,000. Mr. Lesar’s account is fully vested.

      Other Benefits and Perquisites: Mr. Lesar participates in the Halliburton Retirement and Savings Plan, which is the defined contribution benefit plan available to all eligible U.S. employees. He receives annual contributions to the nonqualified Benefit Restoration Plan and carries a balance of $619,025 (as of December 31, 2005) in the Elective Deferral Plan from prior years of participation. Mr. Lesar does not participate in any defined benefit pension plans as the Company no longer offers such plans to its U.S. employees, nor is he a participant in any previously offered pension plans which are now frozen.

      Other than utilizing the Company plane for business and personal travel, as required for security purposes, perquisites for Mr. Lesar are limited. The Company does not pay for any club memberships for Mr. Lesar and he is not provided with any allowances. The Company reimburses him for financial planning services up to a maximum of $15,000 per year and provides for appropriate security assessments and measures at his personal residence. Mr. Lesar receives a physical examination annually as part of the Company’s general focus on health and wellness.

      The above elements of compensation place Mr. Lesar’s total compensation between the 50th and 75th percentile ranges of Halliburton’s comparator group. We believe this is an appropriate position given the Company’s outstanding 2005 performance under Mr. Lesar’s leadership.

POLICY REGARDING SECTION 162(m) OF THE INTERNAL REVENUE CODE

      Section 162(m) of the Internal Revenue Code generally disallows a tax deduction to public companies for compensation paid to the chief executive officer or any of the four other most highly compensated officers to the extent the compensation exceeds $1 million in any year. Qualifying performance-based compensation is not subject to this sanction if certain requirements are met.

      Our policy is to utilize available tax deductions whenever appropriate and consistent with our compensation philosophy. When designing and implementing executive compensation programs, we consider all relevant factors, including the availability of tax deductions with respect to compensation. Accordingly, we have attempted to preserve the federal tax deductibility of compensation in excess of $1 million a year to the extent doing so is consistent with the intended objectives of our executive compensation philosophy, however we may from time to time pay compensation to our executive officers that may not be fully deductible.

      The 1993 Stock and Incentive Plan, as amended and restated effective February 16, 2006, enables qualification of stock options, stock appreciation rights and performance share awards as well as short-term and long-term cash performance plans under Section 162(m).

      We believe that the interests of Halliburton and its shareholders are well served by the executive compensation programs currently in place. These programs encourage and promote Halliburton’s compensation objectives and permit the exercise of our discretion in the design and implementation of compensation packages. We will continue to review our executive compensation plans periodically to determine what changes, if any, should be made.

COMPARISON OF CUMULATIVE TOTAL RETURN

      The following graph compares the cumulative total stockholder return on our common stock for the five-year period ended December 31, 2005, with the Standard & Poor’s 500 Stock Index and the Standard & Poor’s Energy Composite Index over the same period. This comparison assumes the investment of $100 on December 31, 2000, and the reinvestment of all dividends. The stockholder return set forth on the chart below is not necessarily indicative of future performance.

Total Stockholders’ Return – Five Years

Assumes Investment of $100 on December 31, 2000 and Reinvestment of Dividends

      The following four tables set forth information regarding the Chief Executive Officer and the next four most highly compensated executive officers of Halliburton (collectively, the “Named Executive Officers”).

SUMMARY COMPENSATION TABLE

OPTION GRANTS FOR FISCAL 2005

AGGREGATED OPTION EXERCISES IN FISCAL 2005

AND DECEMBER 31, 2005 OPTION VALUES

Long-Term Incentive Compensation

      The Performance Unit Program was established in 2001 to provide selected key executives with incentive opportunities based on the level of achievement of pre-established corporate performance objectives over three-year performance cycles. The purpose of the program is to reinforce Halliburton’s objectives for sustained long-term performance and value creation as well as reinforce strategic planning processes and balance short and long-term decision making.

      Performance measures for the three-year cycle that began January 1, 2005, combine relative and absolute components tied to Halliburton’s consolidated weighted average return on capital employed (ROCE). A performance matrix combining both the actual achievement of pre-established ROCE levels (Absolute Goal) and Halliburton’s ROCE achievement level as compared to the comparator group (Relative Goal) is used to determine the percent of incentive opportunity achieved. The award is then calculated by multiplying the percent of incentive opportunity achieved by the target award. Payment may be made in cash, stock or a combination of cash and stock at the discretion of the Compensation Committee. No incentive will be earned or payment made under the Performance Unit Program for performance below the threshold level.

LONG-TERM INCENTIVE PLANS — AWARDS IN FISCAL 2005

EQUITY COMPENSATION PLAN INFORMATION

EMPLOYMENT CONTRACTS AND

CHANGE-IN-CONTROL ARRANGEMENTS

Employment Contracts

      Mr. Lesar. Mr. Lesar entered into an employment agreement with Halliburton as of August 1, 1995, which provides for his employment as Executive Vice President and Chief Financial Officer of Halliburton. The agreement also provides that, while Mr. Lesar is employed by Halliburton, management will recommend to the Compensation Committee:

      These recommendations are to be consistent with the criteria utilized by the Compensation Committee for similarly situated executives.

      Under the terms of his employment agreement, in the event Mr. Lesar is involuntarily terminated by Halliburton for any reason other than termination for cause (as defined in the agreement), Halliburton is obligated to pay Mr. Lesar a severance payment equal to:

      Mr. Lane. Mr. Lane entered into an employment agreement with Halliburton Energy Services, Inc., on January 1, 1999, which provides for his employment as a Divisional Vice President. Mr. Lane’s employment agreement also provides for an annual salary of not less than $124,296 and participation in Halliburton’s Annual Performance Pay Plan.

      Mr. Gaut. Mr. Gaut entered into an employment agreement with Halliburton on March 3, 2003, which provides for his employment as Executive Vice President. Mr. Gaut’s employment agreement also provided for his subsequent appointment as Chief Financial Officer, an annual salary of not less than $500,000 and participation in Halliburton’s Annual Performance Pay Plan. In addition, Mr. Gaut was granted 30,000 restricted shares and 100,000 stock options under the 1993 Plan.

      Mr. Cornelison. Mr. Cornelison entered into an employment agreement with Halliburton on May 15, 2002, which provides for his employment as Vice President and General Counsel. Mr. Cornelison’s employment agreement also provides for an annual salary of not less than $332,000 and participation in Halliburton’s Annual Performance Pay Plan.

      Mr. McCollum. Mr. McCollum entered into an employment agreement with Halliburton on August 25, 2003, which provides for his employment as Senior Vice President and Chief Accounting Officer. Mr. McCollum’s employment agreement also provides for an annual salary of not less than $350,000 and participation in Halliburton’s Annual Performance Pay Plan. In addition, Mr. McCollum was granted 10,000 restricted shares and 20,000 stock options under the 1993 Plan.

      Under the terms of the employment agreements with Messrs. Lane, Gaut, Cornelison and McCollum, if any of these executives are terminated for any reason other than voluntary termination (as defined in the agreements), death, retirement (either at age 65 or voluntarily prior to age 65), permanent disability, or termination by Halliburton for cause (as defined in the agreements), the executive is entitled to severance payments equal to:

Change-In-Control Arrangements

      Under the 1993 Plan, in the event of a Corporate Change, unless an Award Document otherwise provides, as of the Corporate Change Effective Date, the following will occur automatically:

      Under the Annual Performance Pay Plan:

      Under the Performance Unit Program:

      Under the Employee Stock Purchase Plan, in the event of a change-in-control, unless the successor corporation assumes or substitutes new stock purchase rights:

CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS

      At its meeting on December 7, 2005, the Board determined that as of that date Mr. Hunt would no longer qualify as an independent director under Halliburton’s corporate governance guidelines. Under the guidelines, Mr. Hunt is no longer independent because of work conducted in the ordinary course of business by Halliburton or its affiliates, which totaled approximately $38.8 million in 2005 for Hunt Oil Company, where Mr. Hunt serves as Chief Executive Officer, and Hunt Consolidated, Inc., where he serves as Chairman of the Board, Chief Executive Officer and President (the “Hunt Companies”). The work for the Hunt Companies consisted of oil service work conducted by the Energy Services Group of approximately $31.3 million and engineering and construction work conducted by KBR of approximately $7.5 million related to LNG projects. The level of work performed by Halliburton or its affiliates for the Hunt Companies in 2006 is expected to exceed the 2005 level.

SECTION 16(a) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE

      Section 16(a) of the Securities Exchange Act of 1934 requires our Directors and executive officers to file reports of holdings and transactions in Halliburton shares with the SEC and the New York Stock Exchange. Based on our records and other information, we believe that in 2005 our Directors and our officers who are subject to Section 16 met all applicable filing requirements, except Mr. Albert O. Cornelison, Jr., Executive Vice President and General Counsel of Halliburton, who inadvertently filed a late Form 5 to report a transfer of beneficial ownership of Common Stock into a By-Pass Trust related to his late wife’s estate.

INVOLVEMENT IN CERTAIN LEGAL PROCEEDINGS

      Calpine Corporation, in connection with the departure of its Chairman, President and Chief Executive Officer, named Mr. Derr Chairman of the Board and Acting Chief Executive Officer in November 2005. Mr. Derr, who had previously held the position of Lead Director of Calpine, was Acting Chief Executive Officer for approximately two weeks. Mr. Derr continues to serve as Calpine’s Chairman of the Board. On December 20, 2005, Calpine Corporation filed for federal bankruptcy protection under Chapter 11.

      There are no legal proceedings to which any director, officer or principal shareholder, or any affiliate thereof, is a party that would be material and adverse to Halliburton.

DIRECTORS’ COMPENSATION

Directors’ Fees and Deferred Compensation Plan

      All non-employee Directors receive an annual retainer of $50,000 and an attendance fee of $2,000 for each meeting of the Board of Directors and for each committee meeting attended. The Chairman of each committee also receives an additional retainer annually for chairing a committee as follows: Audit — $20,000; Compensation — $15,000; Management Oversight — $15,000; Health, Safety and Environment — $10,000; and Nominating and Corporate Governance — $10,000.

      Under the Directors’ Deferred Compensation Plan, Directors are permitted to defer their fees, or a portion of their fees. A participant may elect, on a prospective basis, to have his or her deferred compensation account either credited quarterly with interest at the prime rate of Citibank, N.A. or translated on a quarterly basis into

Halliburton common stock equivalents. Distributions after retirement as a Director will be made either in a lump sum or in annual installments over a 5-or 10-year period, as determined in the discretion of the committee appointed to administer the plan. Distributions of common stock equivalents are made in shares of common stock, while distributions of deferred compensation credited with interest are made in cash. Messrs. Crandall, Derr, Gillis, Hunt, and Precourt and Ms. Reed have elected to participate in the plan.

Directors’ Restricted Stock Awards

      Each non-employee Director receives an annual award of restricted shares of common stock as a part of his or her compensation in addition to the Directors’ annual retainer and attendance fees. Each non-employee Director participating in the Directors’ Retirement Plan described below receives an annual award of restricted shares of common stock with a value of $75,000 on the date of the award. Each non-employee Director not participating in the plan, (Messrs. Derr, Gillis, Hunt, Martin, and Precourt and Ms. Reed), receives an annual award of restricted shares of common stock with a value of $100,000 on the date of the award.

      Restricted shares may not be sold, assigned, pledged or otherwise transferred or encumbered until the restrictions are removed. Restrictions lapse following termination of Board service under specified circumstances, which include, among others, death or disability, retirement under the Director mandatory retirement policy, or early retirement after at least four years of service. During the restriction period, Directors have the right to vote, and to receive dividends on, the restricted shares. Any shares that under the plan’s provisions remain restricted following termination of service are forfeited.

Directors’ Retirement Plan

      The Directors’ Retirement Plan is closed to new Directors elected after May 16, 2000. Under the Directors’ Retirement Plan, each participant will receive an annual benefit upon the benefit commencement date. The benefit commencement date is the later of a participant’s termination date or attainment of age 65. The benefit will be equal to the last annual retainer for the participant for a period of years equal to the participant’s years of service on his or her termination date. Upon the death of a participant, benefit payments will be made to the surviving spouse, if any, over the remainder of the retirement benefit payment period. Years of service for each Director participant under the plan are: Mr. Crandall — 21, and Mr. Howell — 15. Assets are transferred to State Street Bank and Trust Company, as Trustee, to be held under an irrevocable grantor trust to aid Halliburton in meeting its obligations under the Directors’ Retirement Plan. The principal and income of the trust are treated as assets and income of Halliburton for federal income tax purposes and are subject to the claims of general creditors of Halliburton to the extent provided in the plan.

Charitable Contributions

      Matching Gift Programs. To further Halliburton’s support for charities, non-employee Directors may participate in the Halliburton Foundation’s (“Foundation”) matching gift programs for educational institutions, not-for-profit hospitals, and medical foundations. For each eligible contribution, the Foundation makes a contribution of two times the amount contributed, subject to approval by the Foundation Trustees and providing the contribution meets certain criteria. The maximum aggregate of all contributions each calendar year by a Director, eligible for matching by the Foundation, is $50,000, resulting in a maximum aggregate amount contributed annually by the Foundation in the form of matching gifts of $100,000 for any Director who participates in the programs. Neither the Foundation nor Halliburton has made a charitable contribution to any charitable organization in which a Director serves as an executive officer, within the preceding three years, that exceeds in any single year the greater of $1 million or 2% of such charitable organization’s consolidated gross revenues.

AUDIT COMMITTEE REPORT

      Halliburton’s Audit Committee consists of Directors who, in the business judgment of the Board of Directors, are independent under Securities and Exchange Commission regulations and the New York Stock Exchange listing standards. In addition, in the business judgment of the Board of Directors, all four members of the Audit Committee, Robert L. Crandall, J. Landis Martin, Jay A. Precourt and Debra L. Reed, have accounting or related financial management experience required under the listing standards and have been designated by the Board of Directors as “audit committee financial experts”. We operate under a written charter, a copy of which is available on Halliburton’s website, www.halliburton.com. As required by the charter, we review and reassess the charter annually and recommend any changes to the Board of Directors for approval.

      Halliburton’s management is responsible for preparing Halliburton’s financial statements and the principal independent accountants are responsible for auditing those financial statements. The Audit Committee’s role is to provide oversight of management in carrying out management’s responsibility and to appoint, compensate, retain and oversee the work of the principal independent accountants. The Audit Committee is not providing any expert or special assurance as to Halliburton’s financial statements or any professional certification as to the principal independent accountants’ work.

      In fulfilling our oversight role for the year ended December 31, 2005, we:

      Based on our:

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, 2005, 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.

FEES PAID TO KPMG LLP

      During 2005 and 2004, Halliburton incurred the following fees for services performed by KPMG LLP:

Audit Fees

      Audit fees represent the aggregate fees for professional services rendered by KPMG LLP for the integrated audit of our annual financial statements for the fiscal years ended December 31, 2005 and December 31, 2004. Audit fees also include the audits of many of our subsidiaries in regards to compliance with statutory requirements in foreign countries, reviews of our financial statements included in the Forms 10-Q we filed for fiscal years 2005 and 2004, and review of registration statements.

Audit-Related Fees

      Audit-related fees primarily include professional services rendered by KPMG LLP for audits of our employee benefit plans and audits of some of our subsidiaries relating to transactions.

Tax Fees

      The aggregate fees for tax services primarily consisted of international tax compliance and services related to our expatriate employees including tax services.

All Other Fees

      All other fees comprise professional services rendered by KPMG LLP related to immigration services and other non recurring miscellaneous services.

Pre-Approval Policies and Procedures

      The Audit Committee has established written pre-approval policies that require the approval by the Audit Committee of all services provided by KPMG LLP as the principal independent accountants that examine the financial statements and the books and records of Halliburton and all audit services provided by other independent accountants. The current version of the policy is attached to this proxy statement as Appendix C. All of the fees described above provided by KPMG LLP to Halliburton were approved in accordance with the policy. Our Audit Committee considered whether KPMG LLP’s provisions of tax services and All Other Fees as reported above is compatible with maintaining KPMG LLP’s independence as our principal independent accounting firm.

Work Performed by KPMG LLP’s Partners and Employees

      KPMG LLP’s work on Halliburton’s audit was performed by KPMG LLP partners and employees.

PROPOSAL FOR RATIFICATION OF THE SELECTION OF AUDITORS

(Item 2)

      KPMG LLP has examined Halliburton’s financial statements beginning with the year ended December 31, 2002. A resolution will be presented at the Annual Meeting to ratify the appointment by the Board of Directors of that firm as independent accountants to examine the financial statements and the books and records of Halliburton for the year ending December 31, 2006. The appointment was made upon the recommendation of the Audit Committee. KPMG LLP has advised that neither the firm nor any member of the firm has any direct financial interest or any material indirect interest in Halliburton. Also, during at least the past three years, neither the firm nor any member of the firm has had any connection with Halliburton in the capacity of promoter, underwriter, voting trustee, Director, officer or employee.

      Representatives of KPMG LLP are expected to be present at the Annual Meeting, will have an opportunity to make a statement if they desire to do so and are expected to be available to respond to appropriate questions from stockholders.

      The affirmative vote of the holders of a majority of the shares of Halliburton’s common stock represented at the Annual Meeting and entitled to vote on the matter is needed to approve the proposal.

      If the stockholders do not ratify the selection of KPMG LLP, the Board of Directors will reconsider the selection of independent accountants.

      The Board of Directors recommends a vote FOR ratification of the appointment of KPMG LLP as independent accountants to examine the financial statements and books and records of Halliburton for the year 2006.

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PROPOSAL TO AMEND THE CERTIFICATE OF INCORPORATION

TO INCREASE AUTHORIZED COMMON STOCK

(Item 3)

      The Board of Directors has unanimously approved, declared advisable and recommends that the stockholders consider and approve an amendment (the “Amendment”) to Article FOURTH of Halliburton’s Certificate of Incorporation, as amended (the “Certificate”), pursuant to which the authorized amount of shares of common stock would be increased from 1 billion shares to 2 billion shares. The Certificate also currently authorizes the issuance of up to 5 million shares of preferred stock (the “Preferred Stock”), of which no shares are issued and outstanding. The Amendment would not alter the authorized amount of Preferred Stock.

      The resolution to be voted upon to effect the Amendment is set forth in Appendix D to this proxy statement.

Purpose and Effects of the Amendment

      As of March 20, 2006 there were approximately 516,358,189 million shares of common stock issued and outstanding and approximately 44,071,081 million shares reserved. Of the shares reserved, approximately 31,568,455 million shares were reserved for employee benefit plans and director compensation plans, and approximately 12,502,626 million shares were reserved for issuance upon conversion of our 3¹/8 % convertible senior notes due 2023.

      The Board of Directors believes that the flexibility provided by the Amendment to permit Halliburton to issue or reserve additional common stock, in the discretion of the Board of Directors, without the delay or expense of a special meeting of stockholders, is in the best interests of Halliburton and its stockholders. Shares of common stock may be used for general purposes, including stock splits and stock dividends, acquisitions, possible financing activities and other employee, executive and director benefit plans. On February 16, 2006, we announced that the Board has authorized a two-for-one split, subject to stockholder approval of the Amendment. Possible financing activities might include raising additional capital funds through offerings of shares of our common stock or of equity or debt securities convertible into or exchangeable for shares of our common stock. Other than the stock split discussed above, we have no present plans, arrangements, commitments or understanding with respect to the issuance of any of the additional shares of common stock that would be authorized by adoption of the Amendment.

      Pursuant to the Certificate, our stockholders have no preemptive rights with respect to the additional shares of common stock being authorized. The Certificate does not require further approval of stockholders prior to the issuance of any additional shares of common stock. In some circumstances (generally relating to the number of shares to be issued, the manner of offering and the identity of the recipients), the rules of the New York Stock Exchange, or NYSE, may require specific authorization in connection with the issuance of additional shares. We do not anticipate that we will seek authorization from stockholders for issuance of additional shares of common stock unless required by applicable laws or the NYSE.

      The issuance of any additional shares of common stock may have the effect of diluting the percentage of stock ownership, book value and voting rights of the present holders of the common stock. The Amendment also may have the effect of discouraging attempts to take over control of Halliburton, as additional shares of common stock could be issued to dilute the stock ownership and voting power of, or increase the cost to, a party seeking to obtain control of us. The Amendment is not being proposed in response to any known effort or threat to acquire control of Halliburton and is not part of a plan by management to adopt a series of amendments to the Certificate and By-laws having an anti-takeover effect.

      In accordance with Delaware law, the affirmative vote of the holders of a majority of the outstanding shares of common stock is required to approve the Amendment. Accordingly, abstentions and broker non-votes applicable to shares present at the Meeting will have the same effect as votes cast against approval of the Amendment. If the Amendment is approved, we intend to file the Amendment with the Secretary of State of Delaware soon after the approval.

      The Board of Directors recommends that the stockholders vote FOR the proposed Amendment to our Certificate of Incorporation.

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PROPOSAL TO APPROVE BOARD POLICY ON FUTURE SEVERANCE AGREEMENTS

(Item 4)

      The Board of Directors has unanimously approved and recommends that the stockholders consider and approve its policy on future severance agreements for executive officers of Halliburton (the “Policy”). Proxies solicited on behalf of the Board of Directors will be voted FOR this proposal unless stockholders specify a contrary choice in their proxies.

      The resolution to be voted on, and the provisions of the Policy, are set forth in Appendix E to this proxy statement.

      I. The Policy provides that we will not enter into a future employment agreement with severance provisions or a future severance agreement with an executive officer that provides “Benefits” (as defined in paragraph A. below) that exceed 2.99 times the executive officer’s annual base salary and bonus, unless such future agreement receives prior stockholder approval or ratification. “Severance” for purposes of the Policy means the termination of an executive officer’s employment with Halliburton. The Policy is prospective only and it will not apply to existing agreements we have with our current executive officers.

      II. The Board determines whether Halliburton should enter into employment or severance agreements with its executive officers. In the event that the Board determines that an employment agreement is in the best interests of Halliburton and its stockholders, we need the flexibility to make an offer of employment and enter into the agreement without delay. If the Board determines that it is in the best interests of Halliburton and its stockholders to enter into an employment or severance agreement with severance provisions that exceed the Policy, the Board will seek stockholder approval of such severance provisions in advance or within 15 months thereafter. Any agreements with severance provisions exceeding the Policy, however, will state that such severance provisions are subject to stockholder approval. In the event that stockholders do not approve the severance provisions, the agreement will provide that such provisions will be retroactively modified to the extent necessary to bring them within the limitations of the Policy.

      The Board’s Policy is substantially similar to policies adopted by other companies in response to stockholder proposals to limit severance benefits paid to such companies’ executive officers.

      The Board of Directors recommends that the stockholders vote to APPROVE the policy.

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STOCKHOLDER PROPOSAL ON HUMAN RIGHTS REVIEW

(Item 5)

      CHRISTUS Health (“CHRISTUS”), located at 2600 North Loop West, Houston, Texas 77092; the Benedictine Sisters of Mount St. Scholastica (“Sisters”), located at 801 S. 8th Street, Atchison, Kansas 66002; and The Catholic Funds (“Funds”), located at 1100 West Wells Street, Milwaukee, Wisconsin 53233, collectively (the “Proponents”), have notified Halliburton that they intend to present the resolution set forth below to the Annual Meeting for action by the stockholders. Their supporting statement for the resolution, along with the Board of Directors’ statement in opposition, is set forth below. As of November 23, 2005, CHRISTUS beneficially owned 5,800 shares of Halliburton’s common stock; as of December 12, 2005, the Sisters beneficially owned 425 shares of Halliburton’s common stock; and as of December 12, 2005, the Funds beneficially owned 1,750 shares of Halliburton’s common stock. Proxies solicited on behalf of the Board of Directors will be voted AGAINST this proposal unless stockholders specify a contrary choice in their proxies.

Report on Human Rights Policies and Implementation-Halliburton

Whereas expectations of the global community are growing that companies need to have policies in place that promote and protect human rights within their areas of activity and sphere of influence, which helps promote and protect the company’s reputation as a good corporate citizen.

Halliburton is one of the world’s largest providers of products and services to the oil and gas industries and has operations globally. For example, KBR, the company’s engineering and construction subsidiary employs more than 60,000 people in 43 countries. (http://www.halliburton.com/about/index.jsp)

Many companies have adopted ethical statements that apply to employee behavior while 92 companies worldwide have adopted explicit human rights policies that address a company’s responsibility to the communities and societies where they operate. (www.business-humanrights.org, November, 2005)

In the Halliburton’s 2003 Corporate Social Responsibility report, “The Journey Continues,” it states: “For a company to be allowed to work globally, it must be able to meet society’s need for goods and services without compromising the natural or social resources of the global community. It must not only be a business leader but a good corporate citizen.”

Our company’s Code of Business Conduct does not address major corporate responsibility issues, such as, human rights. Without a human rights policy, our company faces reputational risks by operating in countries, such as China, where the rule of law is weak and human rights abuses are well documented. (Feb. 28, 2005; U.S. State Department Country Human Rights Reports 2004; http://www.state.gov/g/drl/rls/hrrpt/2004/41640.htm)

Negative publicity hurts our company’s reputation and has the potential to impact shareholder value. “Pentagon investigators have referred allegations of abuse in how the Halliburton Company was awarded a contract for work in Iraq to the Justice Department for possible criminal investigation. . .” according to a recent article in the New York Times. (“Halliburton Case Is Referred to Justice Dept., Senator Says,” by Erik Eckholm, November 19, 2005)

We recommend our company base its human rights policies on the Universal Declaration of Human Rights, the International Labor Organization’s Core Labor Standards and the United Nations Norms on the Responsibilities of Transnational Corporations and Other Business Enterprises with Regard to Human Rights, covering a range of rights, including the right to equal opportunity, security of persons, rights of workers and respect for economic, social and cultural rights. (http://www1.umn.edu/humanarts/links/commentary-Aug2003.html)

Resolved: shareholders request management to review its policies related to human rights to assess areas where the company needs to adopt and implement additional policies and to report its findings, omitting propriety information and prepared at reasonable expense, by December 2006.

Supporting Statement

      We recommend the review include:

      We urge you to vote FOR this proposal.

      The Board of Directors recommends a vote AGAINST this proposal. Halliburton’s statement in opposition is as follows:

      Halliburton is a company that operates in over 100 countries around the world with stockholders, customers, partners, suppliers and employees that represent virtually every race or national origin and an associated multitude of religions, cultures, customs, political philosophies and languages. We must, and do, respect such diversity.

      It is not our purpose as a commercial business enterprise to remake the world in the image of any particular political, legal, moral or religious philosophy with which we are comfortable. Rather, we hope to help improve the quality of life wherever we do business by serving as a developer of natural resources and infrastructures.

      With respect to allegations of violations of human rights by governments, alleged to be illegitimate by some, we believe that decisions as to the nature of such governments and their actions are better made by governmental authorities and international entities such as the United Nations as opposed to individual persons or companies such as Halliburton. Where the United States government has mandated that United States companies refrain from commerce, we comply, often to the advantage of our international competitors. History has shown that single country boycotts, let alone corporate boycotts and sanctions, are ineffective, often injuring the economic interests of the boycotting entity.

      We do not always agree with the policies or actions of governments in every place that we do business and make no excuses for their behaviors. Due to the long-term nature of our business and the inevitability of political and social change, it is neither prudent nor appropriate for Halliburton to establish its own country-by-country foreign policy regarding human rights.

      We have long addressed many of the issues that fall under the umbrella of human rights, such as employment practices, nondiscrimination in employment, health and safety, and security of employees and company facilities. Our support of these issues is clearly communicated in our Code of Business Conduct, which is available on our website at www.halliburton.com/policies/business_conduct.jsp. A brief description of applicable policies within our Code of Business Conduct include the following:

      In addition to these policies in our Code of Business Conduct, we have Corporate Policy 3-1573, Minimum Employment Age Requirement, which establishes our policy that we will not employ anyone, in any capacity, who is under the age of 18 years, except where this minimum employment age requirement is superseded by local law. Where local law supersedes our policy, we will not assign employees under the age of 18 to dangerous or hazardous occupations.

      We believe that because we maintain and enforce these policies, it is not necessary to create an explicit policy on human rights. It is our view that we treat our employees and others in the communities within which we operate in compliance with the values that would be expressed in a policy on human rights.

      Our employees around the world are actively involved in many activities that benefit their local communities. Many locations have active employee volunteer councils providing assistance to a myriad of charitable causes. Information about specific examples of these community service activities is provided on our website at www.halliburton.com/about/community_impact.jsp. We are very proud of the positive contribution being made by thousands of our employees in various communities where they live and work.

      The Board of Directors recommends a vote AGAINST the proposal. Proxies solicited by the Board will be voted against the proposal unless instructed otherwise.

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STOCKHOLDER PROPOSAL ON DIRECTOR ELECTION VOTE THRESHOLD

(Item 6)

      The United Brotherhood of Carpenters Pension Fund (“UBC Fund”), located at 101 Constitution Avenue, N.W., Washington, D.C. 20001, has notified Halliburton that it intends to present the resolution set forth below to the Annual Meeting for action by the stockholders. UBC Fund’s supporting statement for the resolution, along with the Board of Directors’ statement in opposition, is set forth below. As of December 6, 2005, the UBC Fund beneficially owned 7,200 shares of Halliburton’s common stock. Proxies solicited on behalf of the Board of Directors will be voted AGAINST this proposal unless stockholders specify a contrary choice in their proxies.

Director Election Majority Vote Standard Proposal

Resolved: That the shareholders of Halliburton Company (“Company”) hereby request that the Board of Directors initiate the appropriate process to amend the Company’s governance documents (certificate of incorporation or bylaws) to provide that director nominees shall be elected by the affirmative vote of the majority of votes cast at an annual meeting of shareholders.

Supporting Statement: Our Company is incorporated in Delaware. Delaware law provides that a company’s certificate of incorporation or bylaws may specify the number of votes that shall be necessary for the transaction of any business, including the election of directors. (DGCL, Title 8, Chapter 1, Subchapter VII, Section 216). The law provides that if the level of voting support necessary for a specific action is not specified in a corporation’s certificate or bylaws, directors “shall be elected by a plurality of votes of the shares present in person or represented by proxy at the meeting and entitled to vote on the election of directors.”

Our Company presently uses the plurality vote standard to elect directors. This proposal requests that the Board initiate a change in the Company’s director election vote standard to provide that nominees for the board of directors must receive a majority of the vote cast in order to be elected or re-elected to the Board.

We believe that a majority vote standard in director elections would give shareholders a meaningful role in the director election process. Under the Company’s current standard, a nominee in a director election can be elected with as little as a single affirmative vote, even if a substantial majority of the votes cast are “withheld” from that nominee. The majority vote standard would require that a director receive a majority of the vote cast in order to be elected to the Board.

The majority vote proposal received high levels of support last year, winning majority support at Advanced Micro Devices, Freeport McMoRan, Marathon Oil, March & McLennan, Office Depot, Raytheon, and others. Leading proxy advisory firms recommend voting in favor of the proposal.

Some companies have adopted board governance policies requiring director nominees that fail to receive majority support from shareholders to tender their resignations to the board. We believe that these policies are inadequate for they are based on continued use of the plurality standard and would allow director nominees to be elected despite only minimal shareholder support. We contend that changing the legal standard to a majority vote is a superior solution that merits shareholder support.

Our proposal is not intended to limit the judgment of the Board in crafting the requested governance change. For instance, the Board should address the status of incumbent director nominees who fail to receive a majority vote under a majority vote standard and whether a plurality vote standard may be appropriate in director elections when the number of director nominees exceeds the available board seats.

We urge your support for this important director election reform.

      The Board of Directors recommends a vote AGAINST this proposal. Halliburton’s statement in opposition is as follows:

      This proposal is the same proposal presented to our stockholders at the 2005 Annual Meeting, which our stockholders defeated. While the Board is aware that the majority vote standard for election of directors is the subject of much interest and debate, we believe that it is premature for Halliburton to adopt a majority vote standard at this time.

      On January 17, 2006, the Committee on Corporate Laws of the Section of Business Law (the “Committee”) of the American Bar Association released its Preliminary Report on Director Voting (the “Preliminary Report”). The Preliminary Report is focused on the Model Business Corporation Act (the “Model Act”). The Model Act, like Delaware law, which is the law applicable to Halliburton, both have a “holdover” rule provision (Model Act Section 8.05(e); Delaware General Corporation Law (“DGCL”) Section 141(b)). The effect of the holdover rule is that directors remain in office until their successors are elected and qualify. As the Preliminary Report points out beginning on page 15, “If the holdover rule were retained in its present form, a majority default rule would represent only a symbolic change to the plurality voting system because directors who are not elected would nevertheless remain in office until a successor is elected and qualified.” The Preliminary Report further states at page 25 that “. . . the proposed amendments to the Model Act are in one sense more enabling than the Delaware law provisions, because the DGCL does not expressly permit corporations to alter the holdover rule provided in section 141(b) of the DGCL.”

      The proposal refers to efforts by some companies to address the majority voting issue by adopting governance policies requiring director nominees that fail to receive majority support from shareholders to tender their resignation to the board. As indicated in the proposal, the proponent finds that these policies are inadequate.

      While conceptually a majority vote standard is simple, it does raise many issues as described in the Preliminary Report, among them, the holdover rule, failed elections, and the enforceability of director resignations policies. As the Preliminary Report points out, there is a real likelihood that the holdover rule would render a majority vote requirement illusory, because the director not receiving a majority vote would remain in office notwithstanding the vote.

      The required vote to elect directors is clearly an important governance issue. The Board of Directors is of the view that election of Directors of Halliburton by plurality voting is appropriate until the statutory or case law evolves so that there is certainty as to the outcome of elections under a majority vote standard.

      The Board of Directors recommends a vote AGAINST the proposal. Proxies solicited by the Board will be voted against the proposal unless instructed otherwise.

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STOCKHOLDER PROPOSAL ON POISON PILL

(Item 7)

      Lucian Bebchuk, located at 1545 Mass. Ave., Cambridge, Massachusetts 02138, has notified Halliburton that he intends to present the resolution set forth below to the Annual Meeting for action by the stockholders. Mr. Bebchuk’s supporting statement for the resolution, along with the Board of Directors’ statement in opposition, is set forth below. As of December 1, 2005, Mr. Bebchuk beneficially owned 125 shares of Halliburton’s common stock. Proxies solicited on behalf of the Board of Directors will be voted AGAINST this proposal unless stockholders specify a contrary choice in their proxies.

Proposal

      It is hereby RESOLVED that pursuant to Section 109 of the Delaware General Corporation Law, 8 Del. C. § 109, and By-law No. 44, the Company’s By-laws are hereby amended by adding a new By-law No. 18 (and renumbering existing By-law No. 18 and each subsequent By-law to reflect the addition of new By-Law No. 18) as follows:

      This By-law shall be effective immediately and automatically as of the date it is approved by the vote of stockholder in accordance with By-law No. 44.

Supporting Statement

      I believe that poison pills can deny stockholders the ability to make their own decisions regarding whether or not to accept a premium acquisition offer for their stock and, under certain circumstances, can reduce shareholder value. Additionally, events, circumstances and considerations that could make it desirable to adopt or maintain a poison pill might change over time. Therefore, I believe that the decision to adopt or to extend a poison pill should require the affirmative vote of two-thirds of the directors to pass, and that a poison pill should not remain in place indefinitely without the Board’s determination that it continues to be advisable for the Company to retain the poison pill. The proposed amendment to the Company’s By-laws would not prevent the Board from adopting or maintaining a poison pill for as long as necessary consistent with the Board’s exercise of its fiduciary duties, but would simply ensure that the Board not do so without substantial director support and without considering at least every three years whether continuing to maintain such a plan is in the best interests of the Company and its stockholders.

      I urge you to vote “yes” to support the adoption of this proposal.

      The Board of Directors recommends a vote AGAINST this proposal. Halliburton’s statement in opposition is as follows:

      Our stockholders rights plan terminated pursuant to the provisions of the plan on December 15, 2005. We do not currently have a stockholder rights plan in place. In anticipation of the expiration of the former plan, on September 8, 2005, the Halliburton Board adopted a policy on stockholder rights plans to be effective on December 16, 2005. The policy, which was filed on Form 8-K with the Securities and Exchange Commission on December 19, 2005, is as follows:

      The Board believes that the policy it adopted is sufficient and that adopting a further policy requiring that two-thirds of the Directors approve adoption of a stockholder rights plan is unnecessary.

      The Board of Directors recommends a vote AGAINST the proposal. Proxies solicited by the Board will be voted against the proposal unless instructed otherwise.

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ADDITIONAL INFORMATION

Advance Notice Procedures

      Under our By-laws, no business may be brought before an Annual Meeting unless it is specified in the notice of the Meeting or is otherwise brought before the Meeting by or at the direction of the Board or by a stockholder entitled to vote who has delivered notice to Halliburton (containing the information specified in the By-laws) not less than ninety (90) days prior to the first anniversary of the preceding year’s Annual Meeting. These requirements are separate from and in addition to the SEC’s requirements that a stockholder must meet in order to have a stockholder proposal included in Halliburton’s proxy statement. This advance notice requirement does not preclude discussion by any stockholder of any business properly brought before the Annual Meeting in accordance with these procedures.

Proxy Solicitation Costs

      The proxies accompanying this proxy statement are being solicited by Halliburton. The cost of soliciting proxies will be borne by Halliburton. We have retained Georgeson Shareholder Communications Inc. to aid in the solicitation of proxies. For these services, we will pay Georgeson a fee of $12,500 and reimburse it for out-of-pocket disbursements and expenses. Officers and regular employees of Halliburton may solicit proxies personally, by telephone or other telecommunications with some stockholders if proxies are not received promptly. We will, upon request, reimburse banks, brokers and others for their reasonable expenses in forwarding proxies and proxy material to beneficial owners of Halliburton’s stock.

Stockholder Proposals for the 2007 Annual Meeting

      Stockholders interested in submitting a proposal for inclusion in the proxy materials for the Annual Meeting of Stockholders in 2007 may do so by following the procedures prescribed in SEC Rule 14a-8. To be eligible for inclusion, stockholder proposals must be received by Halliburton’s Senior Vice President and Secretary at 5 Houston Center, 1401 McKinney Street, Suite 2400, Houston, Texas 77010, no later than December 2, 2006. The 2007 Annual Meeting will be held on May 16, 2007.

OTHER MATTERS

      As of the date of this proxy statement, we know of no business that will be presented for consideration at the Annual Meeting other than the matters described in this proxy statement. If any other matters should properly come before the Meeting for action by stockholders, it is intended that proxies in the accompanying form will be voted on those matters in accordance with the judgment of the person or persons voting the proxies.

March 21, 2006

Appendix A

CORPORATE GOVERNANCE GUIDELINES

Revised as of December 7, 2005

The Board of Directors believes that the primary responsibility of the Directors is to provide effective governance over Halliburton’s affairs for the benefit of its stockholders. That responsibility includes:

The Board has adopted these Guidelines to assist it in the exercise of its responsibilities. These Guidelines are reviewed periodically and revised as appropriate to reflect the dynamic and evolving processes relating to the operation of the Board.

Operation of the Board — Meetings

      1.  Chairman of the Board and Chief Executive Officer. The Board believes that, under normal circumstances, the Chief Executive Officer of Halliburton should also serve as the Chairman of the Board. The Chairman of the Board and Chief Executive Officer is responsible to the Board for the overall management and functioning of Halliburton.

      2.  Lead Director. The Chairman of the Management Oversight Committee, which is composed of all outside Directors, is Halliburton’s Lead Director. The Lead Director is elected by and from the outside Directors.

      3.  Executive Sessions of Outside Directors. During each regular Board meeting, the outside Directors meet in scheduled executive sessions. Further, the Management Oversight Committee is composed of all of the outside Directors and meets in executive session during a portion of each of its five regular meetings per year. In addition, any member of the Management Oversight Committee may request the Committee Chairman to call an executive session of the Committee at any time.

Each December, the Management Oversight Committee meets in executive session to evaluate the performance of the Chief Executive Officer. In evaluating the Chief Executive Officer, the Committee takes into consideration the executive’s performance in both qualitative and quantitative areas, including:

The evaluation will be communicated to the Chief Executive Officer by the Chairman of the Management Oversight Committee and reviewed by the Compensation Committee in the course of its deliberations before it provides a recommendation to the full Board of Directors for the Chief Executive Officer’s compensation for the next year.

      4.  Attendance of Non-Directors at Board Meetings. The Chief Financial Officer and the General Counsel will be present during Board meetings, except where there is a specific reason for one or both of them to be excluded. In addition, the Chairman of the Board may invite one or more members of management to be in regular attendance at Board meetings and may include other officers and employees from time to time as appropriate to the circumstances.

      5.  Frequency of Board Meetings. The Board has five regularly scheduled meetings per year. Special meetings are called as necessary. It is the responsibility of the Directors to attend the meetings.

      6.  Board Access to Management. Directors have open access to Halliburton’s management, subject to reasonable time constraints. In addition, members of Halliburton’s executive management routinely attend Board and Committee meetings and they and other managers frequently brief the Board and the Committees on particular topics. The Board encourages executive management to bring managers into Board or Committee meetings and other scheduled events who (a) can provide additional insight into matters being considered or (b) represent managers with future potential whom executive management believe should be given exposure to the members of the Board.

      7.  Board Access to Independent Advisors. The Board has the authority to retain, set terms of engagement and dismiss such independent advisors, including legal counsel or other experts, as it deems appropriate, and to approve the fees and expenses of such advisors.

      8.  Long-term Plans. Long-term strategic and business plans will be reviewed annually at one of the Board’s regularly scheduled meetings.

      9.  Selection of Agenda Items for Board Meetings. The Chairman of the Board and Chief Executive Officer prepares a draft agenda for each Board meeting and the agenda and meeting schedule are submitted to the Lead Director for approval. The other Board members are free to suggest items for inclusion on the agenda and each Director is free to raise at any Board meeting subjects that are not on the agenda.

      10. Board/ Committee Forward Agenda. A forward agenda of matters requiring recurring and focused attention by the Board and each Committee will be prepared and distributed prior to the beginning of each calendar year in order to ensure that all required actions are taken in a timely manner and are given adequate consideration.

      11. Information Flow; Advance Review of Meeting Materials. In advance of each Board or Committee meeting, a proposed agenda will be distributed to each Director. In addition, to the extent feasible or appropriate, information and data important to the Directors’ understanding of the matters to be considered, including background summaries and presentations to be made at the meeting, will be distributed in advance of the meeting. Information distributed to the Directors is approved by the Lead Director. Directors also routinely receive monthly financial statements, earnings reports, press releases, analyst reports and other information designed to keep them informed of the material aspects of Halliburton’s business, performance and prospects. It is each Director’s responsibility to review the meeting materials and other information provided by Halliburton.

Board Structure

      1.  Two-thirds of the Members of the Board Must Be Independent Directors. The Board believes that as a matter of policy two-thirds of the members of the Board should be independent Directors. In order to be independent, a Director cannot have a material relationship with Halliburton. A Director will be considered independent if he or she:

      The definition of independence and compliance with this policy will be reviewed periodically by the Nominating and Corporate Governance Committee. All Directors complete independence questionnaires at least annually and the Board makes determinations of the independence of its members.

The Board believes that employee Directors should number not more than 2. While this number is not an absolute limitation, other than the Chief Executive Officer, who should at all times be a member of the Board, employee Directors should be limited only to those officers whose positions or potential make it appropriate for them to sit on the Board.

      2.  Size of the Board. The Board believes that, optimally, the Board should number between 10 and 14 members. The By-laws prescribe that the number of Directors will not be less than 8 nor more than 20.

      3.  Service of Former Chief Executive Officers and Other Former Employees on the Board. Employee Directors shall retire from the Board at the time of their retirement as an employee unless continued service as a Director is requested and approved by the Board.

      4.  Annual Election of All Directors. As provided in Halliburton’s By-laws, all Directors are elected annually. Should a Director’s principal title change during the year, he or she must submit a letter of Board resignation to the Chairman of the Nominating and Corporate Governance Committee who, with the full Committee, shall have the discretion to accept or reject the letter.

      5.  Board Membership Criteria. Candidates nominated for election or reelection to the Board of Directors should possess the following qualifications:

The Nominating and Corporate Governance Committee is responsible for assessing the appropriate mix of skills and characteristics required of Board members in the context of the needs of the Board at a given point in time and shall periodically review and update the criteria as deemed necessary. Diversity in personal background, race, gender, age and nationality for the Board as a whole may be taken into account in considering individual candidates.

      6.  Process for the Selection of new Directors. The Board is responsible for filling vacancies on the Board that may occur between annual meetings of stockholders. The Board has delegated to the Nominating and Corporate Governance Committee the duty of selecting and recommending prospective nominees to the Board for approval. The Nominating and Corporate Governance Committee considers suggestions of candidates for Board membership made by current Committee and Board members, Halliburton management, and stockholders. The Committee may retain an independent executive search firm to identify candidates for consideration. A stockholder who wishes to recommend a prospective candidate should notify Halliburton’s Corporate Secretary, as described in our proxy statement. The Nominating and Corporate Governance Committee also considers whether to nominate persons put forward by stockholders pursuant to Halliburton’s By-laws relating to stockholder nominations.

When the Nominating and Corporate Governance Committee identifies a prospective candidate, the Committee determines whether it will carry out a full evaluation of the candidate. This determination is based on the information provided to the Committee by the person recommending the prospective candidate, and the Committee’s knowledge of the candidate. This information may be supplemented by inquiries to the person who made the recommendation or to others. The preliminary determination is based on the need for additional Board members to fill vacancies or to expand the size of the Board, and the likelihood that the candidate will meet the Board membership criteria listed in item 5 above. The Committee will determine, after discussion with the Chairman of the Board and other Board members, whether a candidate should continue to be considered as a potential nominee. If a candidate warrants additional consideration, the Committee may request an independent executive search firm to gather additional information about the candidate’s background, experience and reputation,

and to report its findings to the Committee. The Committee then evaluates the candidate and determines whether to interview the candidate. Such an interview would be carried out by one or more members of the Committee and others as appropriate. Once the evaluation and interview are completed, the Committee recommends to the Board of Directors which candidates should be nominated. The Board makes a determination of nominees after review of the recommendation and the Committee’s report.

      7.  Director Tenure. The Nominating and Corporate Governance Committee, in consultation with the Chief Executive Officer, will review each Director’s continuation on the Board annually in making its recommendation to the Board concerning his or her nomination for election or reelection as a Director. There are no term limits on Directors’ service, other than mandatory retirement.

      8.  Director Retirement. It is the policy of the Board that each outside Director shall retire from the Board immediately prior to the annual meeting of stockholders following his or her seventy-second birthday. Employee Directors shall retire at the time of their retirement from employment with Halliburton unless continued service as a Director is approved by the Board.

      9.  Director Compensation Review. It is appropriate for executive management of Halliburton to report periodically to the Nominating and Corporate Governance Committee on the status of Halliburton’s Director compensation practices in relation to other companies of comparable size and Halliburton’s competitors.

      10. Changes. Changes in Director compensation, if any, should come upon the recommendation of the Nominating and Corporate Governance Committee, but with full discussion and concurrence by the Board.

      11. General Principles for Determining Form and Amount of Director Compensation. The Nominating and Corporate Governance Committee annually reviews the competitiveness of Halliburton’s Director compensation practices. In doing so, the Committee compares Halliburton’s practices with those of its comparator group, which includes both peer and general industry companies. Specific components reviewed include: cash compensation, equity compensation, benefits and perquisites. Information is gathered directly from published proxy statements of comparator group companies. Additionally, the Committee utilizes external market data gathered from a variety of survey sources to serve as a reference point against a broader group of companies. Determinations as to the form and amount of Director compensation are based on Halliburton’s competitive position resulting from this review.

      12. Conflicts of Interest. If an actual or potential conflict of interest develops because of significant dealings or competition between Halliburton and a business with which the Director is affiliated, the Director should report the matter immediately to the Chairman of the Board for evaluation by the Board. A significant conflict must be resolved or the Director should resign.

If a Director has a personal interest in a matter before the Board, the Director shall disclose the interest to the full Board and excuse himself or herself from participation in the discussion and shall not vote on the matter.

      13. Board Attendance at Annual Meeting. It is the policy of the Board that all Directors attend the Annual Meeting of Stockholders and Halliburton’s annual proxy statement shall state the number of Directors who attended the prior year’s Annual Meeting.

Committees of the Board

      1.  Number and Types of Committees. A substantial portion of the analysis and work of the Board is done by standing Board Committees. A Director is expected to participate actively in the meetings of each Committee to which he or she is appointed.

The Board has established the following standing Committees: Audit; Compensation; Health, Safety and Environment; Management Oversight; and Nominating and Corporate Governance. Each Committee’s charter is to be reviewed periodically by the Committee and the Board.

      2.  Composition of Committees. It is the policy of the Board that only outside Directors serve on Board Committees. Further, only independent Directors serve on the Audit; Compensation; and the Nominating and Corporate Governance Committees.

A Director who is part of an interlocking directorate (i.e., one in which the Chief Executive Officer or another Halliburton executive officer serves on the board of another corporation that employs the Director) may not serve on the Compensation Committee. The composition of the Board Committees will be reviewed annually to ensure that each of its members meet the criteria set forth in applicable SEC, NYSE and IRS rules and regulations.

      3.  Assignment and Rotation of Committee Members. The Nominating and Corporate Governance Committee, with direct input from the Chief Executive Officer, recommends annually to the Board the membership of the various Committees and their Chairmen and the Board approves the Committee assignments. In making its recommendations to the Board, the Committee takes into consideration the need for continuity; subject matter expertise; applicable SEC, IRS or NYSE requirements; tenure; and the desires of individual Board members.

      4.  Frequency and Length of Committee Meetings. Each Committee shall meet as frequently and for such length of time as may be required to carry out its assigned duties and responsibilities. The schedule for regular meetings of the Board and Committees for each year is submitted and approved by the Board in advance. In addition, the Chairman of a Committee may call a special meeting at any time if deemed advisable.

      5.  Committee Agendas; Reports to the Board. Members of management and staff will prepare draft agenda and related background information for each Committee meeting which, to the extent desired by the relevant Committee Chairman, will be reviewed and approved by the Committee Chairman in advance of distribution to the other members of the Committee. A forward agenda of recurring topics to be discussed during the year will be prepared for each Committee and furnished to all Directors. Each Committee member is free to suggest items for inclusion on the agenda and to raise at any Committee meeting subjects that are not on the agenda for that meeting.

Reports on each Committee meeting (other than Management Oversight Committee meetings) are made to the full Board. All Directors are furnished copies of each Committee’s minutes.

Other Board Practices

      1.  Director Orientation and Continuing Education. An orientation program has been developed for new Directors which includes comprehensive information about Halliburton’s business and operations; general information about the Board and its Committees, including a summary of Director compensation and benefits; and a review of Director duties and responsibilities. Halliburton provides continuing education courses several times per year on business unit product and service line operations.

      2.  Board Interaction with Institutional Investors and Other Stakeholders. The Board believes that it is executive management’s responsibility to speak for Halliburton. Individual Board members may, from time to time, meet or otherwise communicate with outside constituencies that are involved with Halliburton. In those instances, however, it is expected that Directors will do so only with the knowledge of executive management and, absent unusual circumstances, only at the request of executive management.

      3.  Stockholder Communications with Directors. To foster better communication with Halliburton’s stockholders, Halliburton established a process for stockholders to communicate with the Audit Committee and the Board of Directors. The process has been approved by both the Audit Committee and the Board, and meets the requirements of the NYSE, and the SEC. The methods of communication with the Board include mail (Board of Directors c/o Director of Business Conduct, Halliburton Company, 1401 McKinney Street, Suite 1400, Houston, Texas 77010, USA), a dedicated telephone number (888-312-2692 or 770-613-6348) and an e-mail address (BoardofDirectors@halliburton.com). Information regarding these methods of communication is also on Halliburton’s website, www.halliburton.com, under “Corporate Governance”.

Halliburton’s Director of Business Conduct, a Company employee, reviews all stockholder communications directed to the Audit Committee and the Board of Directors. The Chairman of the Audit Committee is promptly notified of any significant communication involving accounting, internal accounting controls, or auditing matters. The Chairman of the Management Oversight Committee is promptly notified of any other significant stockholder communications and communications addressed to a named Director is promptly sent to the Director. A report summarizing all communications is sent to each Director quarterly and copies of communications are available for review by any Director.

      4.  Periodic Review of These Guidelines. The operation of the Board of Directors is a dynamic and evolving process. Accordingly, these Guidelines will be reviewed periodically by the Nominating and Corporate Governance Committee and any recommended revisions will be submitted to the full Board for consideration.

Appendix B

COMPENSATION COMMITTEE CHARTER

I. ROLE

The role of the Compensation Committee is to establish and oversee the compensation policies and practices of Halliburton Company on behalf of its Board of Directors. It is the Committee’s responsibility to review, monitor, approve and recommend, as applicable, compensation policies, plans and actions, and make appropriate reports to the Board of Directors. The primary purpose of the Committee is to ensure that the Company’s compensation program is effective in attracting, retaining and motivating key employees, that it reinforces business strategies and objectives consistent with the Company’s goals and that it is administered in a fair and equitable manner consistent with established policies and guidelines.

II. COMMITTEE ORGANIZATION AND OPERATIONS

Member Appointments, Qualifications, and Removals. The Compensation Committee shall consist entirely of at least three independent, non-employee Directors. Committee members shall be appointed by the full Board of Directors for a one-year term beginning immediately following the Annual Meeting of Stockholders each year. A Chairperson shall be designated by the Board from among the members appointed. Committee members shall be chosen based on their competence and ability to add substance to the deliberations of the Committee. Members of the Committee shall have no relationship to the Company that could interfere with the exercise of their independence from management and the Company. At the discretion of the Board, any member may be removed during the one year term for any reason, including loss of member independence. The composition of the Committee shall be reviewed annually to ensure that each of its members meet the criteria set forth in applicable Securities and Exchange Commission, New York Stock Exchange and Internal Revenue Service rules and regulations.

Compensation Committee members shall devote sufficient attention to their duties to enable them to fully understand the environment in which the Company’s compensation program operates as well as to understand and apply principles of competitive compensation practice.

Committee Reports. The Chair of the Committee will report regularly to the full Board of Directors on the Committee’s activities and decisions including, but not limited to, the results of the Committee’s self-evaluation and any recommended changes to the Committee’s Charter.

Meeting Structure. The Committee shall meet a minimum of four times per year. The Secretary of the Company shall be the Secretary of the Board Compensation Committee unless the Committee designates otherwise. In the absence of the Chair during any Committee meeting, the Committee may designate a Chair pro tempore. The Committee shall act only on the affirmative vote of a majority of the members at a meeting or by unanimous written consent.

Subcommittees. The Committee may establish subcommittees consisting of one or more members to carry out such duties as the Committee may assign. Such subcommittees must establish and publish a separate Charter.

III. RESPONSIBILITIES

The Compensation Committee shall be generally responsible for the Company’s overall compensation philosophy and objectives, and specifically responsible for reviewing, approving and monitoring compensation strategies, plan design, guidelines and practices as they relate to senior management.

The Compensation Committee shall be responsible for 1) specifically reviewing and approving compensation for specified officers as provided in Halliburton Company Policy 3-9002 (or any successor policy) and 2) generally reviewing and monitoring compensation for other employees, both as agreed by the Compensation Committee at the start of each year. The scope of the Committee’s authority includes, among other things, the following responsibilities:

IV. COMMITTEE EVALUATION AND CHARTER REVIEW

      The Committee will annually complete an evaluation of its performance and effectiveness and will annually review the Committee’s Charter.

V. RESOURCES AND AUTHORITY OF THE COMMITTEE

      The Committee has the authority to retain, set terms of engagement, and dismiss such outside advisors, including compensation consultants, legal counsel or other experts, as it deems appropriate, and to approve the fees and expenses of such advisors.

Appendix C

CORPORATE POLICY

SERVICES OF INDEPENDENT ACCOUNTANTS

Purpose:

To establish the policy of Halliburton Company, its subsidiaries and affiliates (the “Company”) with respect to (1) the types of services that may be provided by the independent accounting firm appointed to audit the financial statements of Halliburton Company (the “Principal Independent Accountants”) and (2) the approval of all services provided by the Principal Independent Accountants and all audit services provided by other independent accountants.

General:

This Policy is intended to assist management, the Audit Committee and the Board of Directors in carrying out their respective responsibilities to ensure that (1) the independence of the Principal Independent Accountants is not impaired, (2) no prohibited services are provided by the Principal Independent Accountants and (3) that all services provided by the Principal Independent Accountants and all audit services provided by independent accountants other than the Principal Independent Accountants are pre-approved by the Audit Committee. Nothing herein shall be deemed to amend or restrict the Audit Committee Charter, to restrict the authority of the Audit Committee to appoint, compensate, retain and oversee the work of the Principal Independent Accountants and audit services work of other independent accountants or to alter in any way the responsibilities of the Audit Committee, the Principal Independent Accountants, other independent accountants and management as set forth in the Audit Committee Charter or as required under applicable laws, rules or regulations as they relate to the matters covered herein.

Policy:

Any Audit services to be provided by independent accountants other than the Principal Independent Accountants which have been (i) approved by the Committee Designee or (ii) pre-approved by the Audit Committee by virtue of this paragraph 9 but not included in the Other Auditor Services Plan will be reported to the full Audit Committee at its next regularly scheduled meeting.

      Without limiting the generality of the previous sentence, the following “Prohibited Non-Audit Services” shall not be performed for the Company by the Principal Independent Accountants:

Other References:

1.    Halliburton Company Audit Committee Charter.

Appendix D

AMENDMENT TO CERTIFICATE OF INCORPORATION

      RESOLVED, that the first sentence of Article FOURTH of the Restated Certificate of Incorporation of Halliburton be amended to increase the number of authorized shares of Common Stock, par value $2.50 per share, of Halliburton from 1,000,000,000 to 2,000,000,000, such first sentence of Article FOURTH of the Restated Certificate of Incorporation, when so amended, to be and read in its entirety as follows:

      The aggregate number of shares which the Corporation shall have authority to issue shall be two billion five million (2,005,000,000), consisting of two billion (2,000,000,000) shares of Common Stock of the par value of Two and 50/100 Dollars ($2.50) per share and five million (5,000,000) shares of Preferred Stock without par value.

Appendix E

FUTURE SEVERANCE AGREEMENTS POLICY

      RESOLVED, that the stockholders of Halliburton Company (“Halliburton” or the “Company”) hereby approve the Board of Directors’ policy (the “Policy”) that the Company will not enter into a Future Severance Agreement with any Executive Officer that provides Benefits in an amount that exceeds 2.99 times the Executive Officer’s annual base salary and bonus at the time of severance, unless such Future Severance Agreement receives prior stockholder approval or is ratified by stockholders at a regularly scheduled annual meeting within the following 15 months. An “Executive Officer” is any person who is or becomes at the time of execution of a Future Severance Agreement an officer of Halliburton or an affiliate who is required to file reports pursuant to Section 16 of the Securities Exchange Act of 1934, as amended.

      “Future Severance Agreement” means a Future Employment Agreement or a Severance Agreement entered into after the effective date of the Policy. A “Future Employment Agreement” means an agreement between Halliburton or one of its affiliates and an Executive Officer pursuant to which the individual renders services to Halliburton or one of its affiliates as an employee. A “Severance Agreement” means an agreement between Halliburton or one of its affiliates and an Executive Officer, which relates to such individual’s termination of employment with Halliburton and its affiliates.

      “Benefits” means (i) cash amounts payable by Halliburton in the event of termination of the Executive Officer’s employment; and (ii) the present value of benefits or perquisites provided for periods after termination of employment (but excluding benefits or perquisites provided to employees generally). Benefits include lump-sum payments and the estimated present value of any periodic payments made or benefits or perquisites provided following the date of termination.

      Benefits, however, does not include (i) payments of salary, bonus or performance award amounts that had accrued at the time of termination; (ii) payments based on accrued qualified and non-qualified deferred compensation plans, including retirement and savings benefits; (iii) any benefits or perquisites provided under plans or programs applicable to employees generally; (iv) amounts paid as part of any employment agreement intended to “make-whole” any forfeiture of benefits from a prior employer; (v) amounts paid for services following termination of employment for a reasonable consulting agreement for a period not to exceed one year; (vi) amounts paid for post-termination covenants, such as a covenant not to compete; (vii) the value of accelerated vesting or payment of any outstanding equity-based award; or (viii) any payment that the Board determines in good faith to be a reasonable settlement of any claim made against Halliburton.

DIRECTIONS TO THE SIMMONS CENTER, DUNCAN, OKLAHOMA

Form # HO4639