KBR BENEFIT RESTORATION PLAN

KBR

BENEFIT RESTORATION PLAN

Restated December 31, 2008

TABLE OF CONTENTS

KBR

BENEFIT RESTORATION PLAN

W I T N E S S E T H:

WHEREAS , the Board of Directors of Halliburton Company (“Halliburton”) has previously adopted the Halliburton Company Benefit Restoration Plan, as most recently amended and restated effective January 1, 2004, for the benefit of its employees and the employees of its subsidiaries to aid such employees in making more adequate provision for their retirement; and

WHEREAS , Halliburton determined that it would be appropriate and desirable for Halliburton to separate the business and assets of KBR, Inc. (the “Company”) and its subsidiaries , from the business and assets of Halliburton and its other subsidiaries through an initial public offering of the common stock of the Company; and

WHEREAS , Halliburton plans to take action which will result in the Company and its subsidiaries ceasing to be a member of the Halliburton controlled group; and

WHEREAS , the Company desires to provide benefits for certain of its new employees including certain current employees who had previously participated in the HAL Plan, as hereafter defined; and

WHEREAS , pursuant to the terms of the HAL Plan, each Employer thereunder was liable for the benefits related to its employees, and the Company and the Employers hereunder desire to continue to provide to such employees an opportunity to make deferrals of certain amounts, consistent with the provisions of Section 409A of the Internal Revenue Code of 1986 as amended (the “Code”); and

WHEREAS, the provisions of the HAL Plan, as amended through the Effective Date, will remain in effect for all deferrals prior to the Effective Date; and

WHEREAS , the Company desires to preserve the material terms of the HAL Plan as in effect on December 31, 2004 (the “Grandfathered Plan”) in order that the Grandfathered Plan qualify as a grandfathered plan for purposes of Section 409A of the Code; and

WHEREAS , certain provisions applicable solely to the Grandfathered Plan are preserved in Appendix A, for purposes of determining the terms applicable to amounts deferred under the Grandfathered Plan, which provisions shall be substituted for the corresponding provisions contained herein.

NOW THEREFORE , the HAL Plan, including the Grandfathered Plan, is hereby continued for Participants with the terms set forth below, and is hereby renamed the KBR Benefit Restoration Plan to read as follows, effective as of the Effective Date:

ARTICLE I

Purpose of the Plan

The purpose of the KBR Benefit Restoration Plan is to provide a vehicle to restore qualified plan benefits which are reduced as a result of limitations on contributions imposed under the Internal Revenue Code or due to participation in other company sponsored plans and to defer compensation that would otherwise be treated as excessive employee remuneration within the meaning of Section 162(m) of the Internal Revenue Code.

ARTICLE II

Definitions

Where the following words and phrases appear in the Plan, they shall have the respective meanings set forth below, unless their context clearly indicates to the contrary.

(A)       Account : An individual account for each Participant on the books of such Participant’s Employer to which is credited amounts allocated for the benefit of such Participant pursuant to the provisions of Article IV, Paragraphs (A) and (B), amounts transferred to the Plan from other deferred compensation plans, and interest credited pursuant to the provisions of Article IV, Paragraph (D).

(B)       Allocation Year : The calendar year for which an allocation is made to a Participant’s Account pursuant to Article IV.

(E)        Committee : The administrative committee appointed by the Compensation Committee to administer the Plan.

(G)       Company : KBR, Inc. or, only for amounts deferred under the HAL Plan and similar purposes, Halliburton Company.

(H)       Deconsolidation Date : The date upon which an event reduces the amount of the Company stock owned directly or indirectly by Halliburton Company to be less than the amount required for Halliburton Company to control the Company within the meaning of Section 1504(a)(2) of the Code.

(I)         Effective Date : The effective date of this restatement is December 31, 2008. The original effective date of the Plan is the Deconsolidation Date.

(J)        Employee : Any employee of an Employer. The term does not include independent contractors or persons who are retained by an Employer as consultants only.

(K)       Employer : The Company, each of the entities identified on Schedule A and each eligible organization designated as an Employer in accordance with the provisions of Article III of the Plan.

(L)        ERISA : The Employee Retirement Income Security Act of 1974, as amended.

(M)      Grandfathered Plan : The Halliburton Company Benefit Restoration Plan as in effect on December 31, 2004, the material terms of which have not been materially modified (within the meaning of Section 409A) after October 3, 2004, and are preserved and continued in the Plan as reflected in Appendix A.

(N)       Grandfathered Plan Account : A memorandum bookkeeping account established on the records of the Employer for a Participant that is credited with specified deferrals of amounts earned and vested prior to January 1, 2005, and the interest on such amounts determined in accordance with Article XIII, Paragraph (B) of the Grandfathered Plan. A Participant has a 100% non-forfeitable interest in his or her Grandfathered Plan Account at all times.

(O)       HAL Plan : The Halliburton Company Benefit Restoration Plan, as amended and restated effective January 1, 2004 and as subsequently amended with respect to any period up to the Effective Date.

(P)        Participant : An Employee whose compensation from the Employers for an Allocation Year is in excess of the limit set forth in Section 401 (a)(17) of the Code for such Allocation Year or who has made elective deferrals for such Allocation Year under the KBR Elective Deferral Plan. The foregoing notwithstanding, an Employee whose employment with an Employer is terminated prior to the last day of an Allocation Year for any reason other than death, disability or retirement in accordance with the terms of his or her Employer’s retirement policy shall not be eligible to participate in the Plan for such Allocation Year and, accordingly, such Employee’s Account shall not be credited with any allocation under Article IV, Paragraph (A) for such Allocation Year

(Q)       Plan : The KBR Benefit Restoration Plan, as amended from time to time, constituting a continuation of the HAL Plan.

(R)       Section 409A (“409A”) : Internal Revenue Code Section 409A and the applicable proposed Department of Treasury Regulations and other Treasury guidance thereunder.

(S)        Subsidiary : At any given time, a company (whether a corporation, partnership, limited liability company or other form of entity) in which the Company or any other of its Subsidiaries or both owns, directly or indirectly, an aggregate equity interest of 80% or more.

(T)        Termination of Service : “Separation from service” or “Termination of Employment”, as defined in Treasury Regulation §1.409A-1(h).

ARTICLE III

Administration of the Plan

(A)      The Compensation Committee shall appoint a Committee to administer, construe and interpret the Plan. Such Committee, or such successor Committee as may be duly appointed by the Compensation Committee, shall serve at the pleasure of the Compensation Committee. Decisions of the Committee, with respect to any matter involving the Plan, shall be final and binding on the Company, its shareholders, each Employer and all officers and other executives of the Employers. For purposes of ERISA, the Committee shall be the Plan “administrator” and shall be the “named fiduciary” with respect to the general administration of the Plan.

(B)      The Committee shall maintain complete and adequate records pertaining to the Plan, including but not limited to Participants’ Accounts, amounts transferred to the Trust, reports from the Trustee and all other records which shall be necessary or desirable in the proper administration of the Plan. The Committee shall furnish the Trustee such information as is required to be furnished by the Committee or the Company pursuant to the Trust Agreement.

(C)      The Company shall indemnify and hold harmless each member of the Committee against any and all expenses and liabilities arising out of his or her administrative functions or fiduciary responsibilities, including any expenses and liabilities that are caused by or result from an act or omission constituting the negligence of such member in the performance of such functions or responsibilities, but excluding expenses and liabilities that are caused by or result from such member’s own gross negligence or willful misconduct. Expenses against which such member shall be indemnified hereunder shall include, without limitation, the amounts of any settlement or judgment, costs, counsel fees, and related charges reasonably incurred in connection with a claim asserted or a proceeding brought or settlement thereof.

(D)      The Committee may designate any Subsidiary as an Employer by written instrument delivered to the Secretary of the Company and the designated Employer. Such written instrument shall specify the effective date of such designated participation, may incorporate specific provisions relating to the operation of the Plan which apply to the designated Employer only and shall become, as to such designated Employer and its employees, a part of the Plan. Each designated Employer shall be conclusively presumed to have consented to its designation and to have agreed to be bound by the terms of the Plan and any and all amendments thereto upon its submission of information to the Committee required by the terms of or with respect to the Plan; provided, however, that the terms of the Plan may be modified so as to increase the obligations of an Employer only with the consent of such Employer, which consent shall be conclusively presumed to have been given by such Employer upon its submission of any

information to the Committee required by the terms of or with respect to the Plan. Except as modified by the Committee in its written instrument, the provisions of this Plan shall be applicable with respect to each Employer separately, and amounts payable hereunder shall be paid by the Employer which employs the particular Participant, if not paid from the Trust Fund.

(E)       No member of the Committee shall have any right to vote or decide upon any mat