SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
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FORM 8-K
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
DATE OF REPORT (date of earliest event reported)
JUNE 28, 2001
Halliburton Company
(Exact name of registrant as specified in its charter)
State or other Commission IRS Employer
jurisdiction File Number Identification
of incorporation Number
Delaware 1-3492 No. 75-2677995
3600 Lincoln Plaza
500 North Akard Street
Dallas, Texas 75201-3391
(Address of principal executive offices)
Registrant's telephone number,
including area code - 214/978-2600
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INFORMATION TO BE INCLUDED IN REPORT
Item 5. Other Events
The registrant may, at its option, report under this item any events, with
respect to which information is not otherwise called for by this form, that the
registrant deems of importance to security holders.
On June 28, 2001 registrant issued a press release entitled
"Harbison-Walker Asks Halliburton For Assistance With Asbestos Claims"
pertaining, among other things, to an announcement that Harbison-Walker
Refractories Company ("Harbison"), formerly owned by registrant's subsidiary,
Dresser Industries, Inc., ("Dresser") has requested that Dresser provide
Harbison with claims management and financial assistance for asbestos claims
Harbison assumed when it was spun-off from Dresser in 1992. The asbestos claims
of both Harbison and Dresser are covered under a substantial insurance program.
Consequently, Dresser has a substantial interest in the claims resolution and
the most effective use of the insurance. In the 1992 spin-off Harbison and
Dresser entered into an agreement allocating responsibility for asbestos claims
related to the refractory business. Dresser agreed to retain claims filed prior
to the spin-off with Harbison agreeing to assume claims filed after the spin-off
and to indemnify and defend Dresser against those claims. Registrant is
investigating Harbison's asbestos claims and the financial condition of Harbison
and its affiliates. If registrant determines that Harbison is not able to
adequately perform its obligations under the assumption agreement and that it is
in registrant's best interest to do so, registrant may take the primary role for
management and resolution of Harbison's claims. If such a decision is made, it
would require an additional reserve for estimated known claims at June 30, 2001,
net of insurance recoveries, of approximately $50 to 60 million, after-tax. This
reserve would be recorded as a discontinued operations expense and be reduced by
the contributions Harbison is capable of making toward the resolution of these
claims. Any required expense associated with the asbestos issues and the
previously announced gain on the sale of the DEG business segment of
approximately $300 million after tax would be netted together and both be
included in the total discontinued operations. Results from continuing
operations will not be affected.
Item 7. Financial Statements and Exhibits
List below the financial statements, pro forma financial information and
exhibits, if any, filed as part of this report.
(c) Exhibits.
Exhibit 20 - Press release dated June 28, 2001.
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SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
HALLIBURTON COMPANY
Date: June 29, 2001 By: /s/ Susan S. Keith
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Susan S. Keith
Vice President and Secretary
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EXHIBIT INDEX
Exhibit Description
20 Press Release Dated June 28, 2001
Incorporated by Reference
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FOR IMMEDIATE RELEASE Contact: Guy T. Marcus
06/28/01 Vice President-Investor Relations
214/978-2691
HARBISON-WALKER ASKS HALLIBURTON FOR ASSISTANCE
WITH ASBESTOS CLAIMS
DALLAS, Texas -- Halliburton Company (NYSE:HAL) today announced that
Harbison-Walker Refractories Company ("Harbison"), formerly owned by a
Halliburton subsidiary, Dresser Industries, Inc. ("Dresser"), has requested that
Dresser provide Harbison with claims management and financial assistance for
asbestos claims Harbison assumed when it was spun-off from Dresser in 1992.
Many of these Harbison claims are asserted in lawsuits that also name
Dresser as a defendant and Harbison is, in effect, co-insured with Dresser under
a substantial insurance program that covers these claims and other asbestos
claims against Dresser. Consequently, Dresser has a substantial interest in
their resolution and the most effective use of this insurance.
In 1967 Dresser acquired Harbison's refractory manufacturing business and
operated it as a division. In 1992 the refractory business and other non-core
Dresser businesses were placed in a new subsidiary, Indresco, Inc., and spun-off
to Dresser's shareholders. Indresco's name was later changed to Harbison-Walker
Refractories Company. Harbison is now a subsidiary of RHI AG, an Austrian
company.
In conjunction with the 1992 spin-off, Dresser and Harbison entered an
agreement which allocated between them responsibility for asbestos claims
related to the refractory business. Dresser agreed to retain claims filed prior
to the spin-off. Harbison agreed to assume claims filed after the spin-off and
to indemnify and defend Dresser against those claims.
Halliburton is now investigating Harbison's asbestos claims, including the
status of various completed and proposed settlements and, open unsettled claims,
and the financial condition of Harbison and its affiliates. Based on information
received, Halliburton believes that Harbison now has about 165,000 open claims
of which approximately 52,000 are subject to various settlement negotiations or
agreements. These claims have not been previously reported by Halliburton
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Halliburton Company page 2
because of Harbison's agreement to assume full responsibility for these claims
and to indemnify and defend Dresser against them.
If Halliburton determines that Harbison is not able to perform adequately
its obligations under the assumption agreement and that it is in Halliburton's
best interest to do so, Halliburton may take the primary role for management and
resolution of Harbison's claims. A decision in this regard is expected in the
next several weeks.
Based on the information it has developed to date and its own experience in
managing asbestos claims, Halliburton believes that if such a decision is made
it would require an additional reserve for estimated known claims at June 30,
2001, net of insurance recoveries, of approximately $50 to $60 million,
after-tax. This reserve would be recorded as a discontinued operations expense
and be reduced by the contributions Harbison is capable of making toward the
resolution of these claims.
As previously announced, Halliburton will report a gain on the sale of the
DEG Business Segment of approximately $300 million after tax. This gain and any
required expense associated with the asbestos issues above would be netted
together and both be included in the total discontinued operations. Results from
continuing operations will not be affected.
"This is an unexpected development", said Dave Lesar, Chairman, President
and CEO of Halliburton. "Although Harbison reaffirmed its responsibility for
these claims as recently as last year, it appears that it may be in our best
interest to step in and protect our shareholders."
Halliburton Company, founded in 1919, is the world's largest provider of
products and services to the petroleum and energy industries. The company serves
its customers with a broad range of products and services through its Energy
Services Group and Engineering and Construction Group business segments. The
company's World Wide Web site can be accessed at www.halliburton.com.
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