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Maximizing network lifetime and minimizing energy consumption are among the central concerns in the design of applications and protocols for wireless sensor networks (WSN). Clustering has been proven energy-efficient in sensor networks since data processing, filtering routing and relaying are oper ated only by cluster heads, thus reducing network load and alleviating the bandwidth. In this paper, we propose a novel distributed clustering algorithm where cluster heads are elected following a three-way message exchange between each sensor and its neighbors. Sensor's eligibility to be elected cluster head is mainly based on its residual energy and its degree. Our protocol has a message exchange complexity of O(l) and a worst-case convergence time complexity of O(N). Simulations show that our algorithm outperforms EESH, a recently published distributed clustering algorithm, in terms of network lifetime and ratio of elected cluster heads.