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A letter from KBR President and CEO Stuart Bradie to all employees

I am writing today to update you on KBR's use of employee confidentiality statements to protect sensitive company information. As you may know, on April 1, the Securities and Exchange Commission (SEC) announced a settlement with KBR resolving the SEC's examination of KBR's use of those statements in connection with sensitive internal investigations conducted by its Law Department under the Code of Business Conduct. The SEC had expressed concern that language in our confidentiality statements could deter employees from reporting perceived wrongdoing to the SEC. You may read a copy of the SEC Order settling the matter. I am proud of KBR's compliance program, Code of Business Conduct, and our culture of integrity. The SEC settlement acknowledges that the SEC is not aware of KBR having ever prevented anyone from reporting to the SEC, nor has the company taken any action to enforce the confidentiality agreement. We firmly believe this to be the case. Indeed, KBR always intended that the statements be used only to protect the integrity and confidentiality of our internal, privileged investigations. Our COBC is designed thoroughly to investigate reports of wrongdoing, bring matters to the attention of law enforcement where appropriate, and fully cooperate with law enforcement investigations. KBR never intended that the confidentiality agreements at issue should be read to deter or prevent an employee from reporting allegations of misconduct to any government agency. Accordingly, we agreed to change the language we use in our COBC confidentiality statements to make clear what we have always believed, that our employees are free to report alleged misconduct. We want to make crystal clear that any current or former KBR employee who has signed a confidentiality agreement with KBR, in any form and for any reason, may report possible violations of federal law or regulation to any governmental agency or entity, including but not limited to the Department of Justice, the Securities and Exchange Commission, the Congress, and any agency Inspector General, or may make other disclosures that are protected under the whistleblower provisions of federal law or regulation. An employee does not need prior approval, and is not required to notify the company, before making a report or disclosure. I am sure you will support KBR to work with the highest standards of safety, ethics and compliance - so that we can deliver on our promises and support our customers both now and in the future.