RHI receives USD 10 million from Halliburton subsidiary DII

24. January 2005

RHI and the Halliburton subsidiary DII Industries (“DII“) agreed in April 2004 to settle their legal disputes about an agreement made in the year 2002 regarding further payments in the context of the Chapter 11 proceedings of Harbison-Walker. In December 2003, DII initiated its own Chapter 11 proceedings in accordance with the US Bankruptcy Code and presented a plan of reorganization, which, among other things, provided for the establishment of trust funds for asbestos and silica-based claims against RHI’s former US subsidiary Harbison-Walker and permanent channeling injunctions in accordance with Sections 524(g) and/or 105 of the US Bankruptcy Code with respect to such claims.

Following the agreements of April 2004, the DII plan of reorganization was amended with the objective to make RHI and its affiliates beneficiaries of the channeling injunctions contemplated by the DII plan of reorganization. DII also committed to pay USD 10.0 million to RHI and, on behalf of the RHI affiliates, USD 1.0 million to the asbestos and silica trusts.

In the course of the successful completion of its Chapter 11 proceedings, DII has now paid USD 10.0 million to RHI in accordance with its contractual obligations. RHI has thus taken another essential step towards ending the asbestos problems in the US as all present and future asbestos and silica-based claims against the former RHI subsidiary Harbison-Walker, which is currently still operating under Chapter 11, are diverted to the DII trust funds definitively and with legal security.

All other asbestos based claims against other former US companies of RHI are dealt with within the framework of the separate Chapter 11 proceedings of these companies, which have not been consolidated in the RHI Group since the end of 2001.