SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a) of the Securities
Exchange Act of 1934 (Amendment No. )
Filed by the Registrant [X]
Filed by a Party other than the Registrant [ ]
Check the appropriate box:
[ ] Preliminary Proxy Statement
[ ] Confidential, for Use of the Commission Only (as permitted by
Rule 14a-6(e)(2))
[X] Definitive Proxy Statement
[ ] Definitive Additional Materials
[ ] Soliciting Material Pursuant to Section 240.14a-11(c) or
Section 240.14a-12
EXXON CORPORATION
.................................................................
(Name of Registrant as Specified In Its Charter)
.................................................................
(Name of Person(s) Filing Proxy Statement, if other than the Registrant)
Payment of Filing Fee (Check the appropriate box):
[X] $125 per Exchange Act Rules 0-11(c)(1)(ii), 14a-6(i)(1),
14a-6(i)(2) or Item 22(a)(2) of Schedule 14A.
[ ] $500 per each party to the controversy pursuant to Exchange
Act Rule 14a-6(i)(3).
[ ] Fee computed on table below per Exchange Act Rules
14a-6(i)(4) and 0-11.
1) Title of each class of securities to which transaction
applies:
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2) Aggregate number of securities to which transaction
applies:
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3) Per unit price or other underlying value of transaction
computed pursuant to Exchange Act Rule 0-11 (Set forth the
amount on which the filing fee is calculated and state how it was
determined):
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[ ] Fee paid previously with preliminary materials.
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[Logo]
EXXON CORPORATION
5959 Las Colinas Boulevard
Irving, TX 75039-2298
Dear Shareholder:
You are cordially invited to attend the annual meeting of shareholders
which will be held in Dallas, Texas, on Wednesday, April 24, 1996.
By attending the meeting, you will have an opportunity to hear a report on
the operations of your Corporation and to meet your directors and executives.
This booklet includes the notice of the meeting and the proxy statement
which contains information about the functions of your Board of Directors and
its committees and personal information about each of the nominees for the
Board. It also includes one Board of Directors proposal and one shareholder
proposal, with the Board's position on each.
It is important that your shares be represented at the meeting regardless
of the size of your holdings. I urge you to complete, sign, date, and return
your proxy card promptly.
If you plan to attend the meeting and are a shareholder of record, please
mark your proxy card in the space provided for that purpose. An admission ticket
is included with the proxy card for each shareholder of record. However, if your
shares are not registered in your own name, please advise the shareholder of
record (your bank, broker, etc.) that you wish to attend. That firm must provide
you with evidence of your ownership which will enable you to gain admittance to
the meeting.
A report on the annual meeting will be included in the June issue of Exxon
Perspectives, the Corporation's periodic report to shareholders.
Sincerely yours,
/s/ Lee R. RAYMOND
L. R. RAYMOND
Chairman of the Board
March 12, 1996
YOUR VOTE IS IMPORTANT
PLEASE COMPLETE, SIGN, DATE, AND PROMPTLY RETURN
YOUR PROXY CARD IN THE ENCLOSED ENVELOPE
Notice of
Annual Meeting
of
Shareholders
The annual meeting of shareholders of the Corporation will be held at the
Morton H. Meyerson Symphony Center, 2301 Flora Street, Dallas, Texas, on
Wednesday, April 24, 1996, beginning at 10:00 a.m., Central Daylight Time, for
the following purposes:
to elect directors;
to consider and act upon:
a proposal concerning ratification of the appointment of independent
public accountants, which is RECOMMENDED by the Board of Directors;
the shareholder proposal set forth on pages 17 and 18, which is OPPOSED by
the Board of Directors; and
to transact any other business which properly may be brought before the
meeting.
Shareholders of record at the close of business on February 26, 1996 will
be entitled to vote at the meeting.
By order of the Board of Directors,
/s/ T. P. TOWNSEND
T. P. TOWNSEND
Secretary
Exxon Corporation
5959 Las Colinas Boulevard
Irving, TX 75039-2298
March 12, 1996
Proxy Statement
TABLE OF CONTENTS
page
General Information............................................... 1
Board of Directors................................................ 2
Election of Directors............................................. 4
Executive Compensation............................................ 10
Board of Directors Proposal
Ratification of the appointment of independent
public accountants........................................... 16
Shareholder Proposal
Additional reporting of political contributions................. 17
Additional Information............................................ 18
GENERAL INFORMATION
Attendance at the annual meeting of shareholders is limited to shareholders
of record or their proxies, beneficial owners of Exxon stock having evidence of
ownership, and guests of the Corporation.
Any shareholder or shareholder's representative who, because of a
disability, may need special assistance to allow him or her to participate at
the annual meeting of shareholders may request reasonable assistance from the
Corporation by contacting Exxon Corporation, Investor Relations, P.O. Box
140369, Irving, TX 75014-0369, (214) 444-1157. To provide the Corporation
sufficient time to arrange for reasonable assistance, please submit all requests
by April 11, 1996.
Consideration of certain matters, such as the election of directors, is
required at the annual meeting. In addition, by submitting a proposal to the
Corporation on a timely basis, a shareholder may present any proposal which is a
proper subject for inclusion in the proxy statement and for consideration at the
annual meeting.
Shareholder Proposals for 1997 Annual Meeting
Under the current rules of the Securities and Exchange Commission, in order
to be included in proxy material for the 1997 annual meeting, a proposal must be
received by the Corporation by the close of business on November 12, 1996. It is
suggested that a proponent submit any proposal by Certified Mail -- Return
Receipt Requested. Detailed information for submitting a proposal will be
provided upon written request to the Secretary of the Corporation.
Voting
It is the policy of the Corporation that all proxy (voting instruction)
cards and ballots, which identify shareholders, be kept secret. Proxy cards are
returned in envelopes addressed to the independent tabulator who receives,
inspects, and tabulates the proxies. Individual-voted proxies and ballots are
not seen by, nor reported to, the Corporation, except in cases where
shareholders write comments on their proxy cards or in limited circumstances,
such as a proxy solicitation in opposition to the Board of Directors.
The accompanying proxy card is designed to permit each shareholder of
record at the close of business on February 26, 1996 to vote in the election of
directors and on the proposals described in this proxy statement. If a
shareholder is a participant in Exxon's Shareholder Investment Program, the
proxy will be used for voting instructions for the number of full shares in the
Shareholder Investment Program account as well as shares registered in the
participant's name. Shares in the Exxon Thrift Fund are registered in the name
of the Trustee-Thrift Fund. A separate proxy must be used for voting
instructions for those shares held in a participant's Thrift Fund Account.
The proxy card provides space for a shareholder to withhold voting for any
or all nominees for the Board of Directors or to abstain from voting for any
proposal if the shareholder chooses to do so. Other than the election of
directors, which requires a plurality of the votes cast, each matter to be
submitted to the shareholders requires the affirmative vote of a majority of the
votes cast at the meeting. For purposes of determining the number of votes cast
with respect to any voting matter, only those cast 'for' or 'against' are
included. Abstentions and broker non-votes are counted only for purposes of
determining whether a quorum is present at the meeting.
When a signed proxy card is returned with choices specified with respect to
voting matters, the shares represented are voted by the Proxy Committee in
accordance with the shareholder's instructions to the tabulator. That Committee
consists of five directors whose names are listed on the proxy card. A
shareholder wishing to name as his or her proxy someone other than those
designated on the proxy card may do so by crossing out the names of the five
designated proxies and inserting the name of another person to act as his or her
proxy. In that case, it will be necessary for the shareholder to sign the proxy
card and deliver it to the person named and for the person so named to be
present and vote at the meeting. Proxy cards so marked should not be mailed
directly to the independent tabulator or the Corporation.
If a signed proxy card is returned and the shareholder has made no
specifications with respect to voting matters, the shares will be voted for the
nominees for director identified on pages 4 through 9, for the Board of
Directors proposal described on pages 16 and 17, and against the shareholder
proposal described on pages 17 and 18. A shareholder who has returned a proxy
card may revoke it at any time before it is voted at the meeting by executing a
later-dated proxy, by voting by ballot at the meeting, or by filing with the
Inspectors of Election an instrument of revocation.
Annual Report
Securities and Exchange Commission rules require that an annual report
precede or accompany proxy material. More than one annual report need not be
sent to the same address if the recipient agrees. If more than one annual report
is being sent to your address, at your request, mailing of the duplicate copy to
the account you select will be discontinued. You may so indicate in the space
provided on the proxy card.
1
BOARD OF DIRECTORS
The Board met eleven times in 1995. It meets regularly to review
significant developments affecting Exxon and to act on matters requiring Board
approval. The average attendance of the directors during 1995 at the aggregate
of the total number of meetings of the Board and committees of the Board was
98%. The Board reserves certain powers and functions to itself. In addition, it
has requested that the Chief Executive Officer refer certain matters to it. The
Board normally considers dividend action in January, April, July, and October.
At its February meeting, it reviews and approves the annual report to
shareholders for the prior year, the annual report on Form 10-K to be filed with
the Securities and Exchange Commission, and the proxy material for the
forthcoming annual meeting of shareholders. In November, it normally reviews
Exxon's capital investment plans for the coming years.
The directors are elected annually by the shareholders of the Corporation.
Twelve are to be elected for the coming year. All nominees are presently serving
as directors. All current nominees were elected at the last annual meeting of
shareholders with the exception of Harry J. Longwell who was elected a director
by the Board on October 25, 1995 and Michael J. Boskin who was elected a
director by the Board on January 31, 1996.
Nine of the nominees are not Exxon employees. They include business
executives, a senior marine scientist, and an economist and educator. The other
three nominees are Exxon executive officers with broad service and experience in
a variety of the Corporation's worldwide activities. Personal information for
each nominee is given in the 'Election of Directors' section of this proxy
statement.
Nonemployee directors cannot stand for reelection after they have reached
age 70. Thus, Randolph W. Bromery, who was nominated last year, is not standing
for reelection at the forthcoming annual meeting of shareholders. Employee
directors normally resign from the Board no later than the date on which they
cease to be employees of Exxon as in the case of Charles R. Sitter, who resigned
from the Board effective January 31, 1996 upon his mandatory retirement as an
employee.
Employee directors are not compensated for services as a director.
Nonemployee directors receive annual compensation at the rate of $40,000 and a
fee of $1,500 for each Board of Directors and Board committee meeting attended.
Exclusive of service on the Executive Committee, they also receive annual
compensation at the rate of $3,000 for each Board committee membership and an
additional $5,000 for serving as chairman of a Board committee. Nonemployee
directors are given the opportunity to elect to defer all or part of their
compensation and fees.
Under the shareholder-approved Restricted Stock Plan for Nonemployee
Directors ('Plan'), each person who becomes a nonemployee director for the first
time is granted an award of 1,500 shares of restricted Common Stock effective as
of the date the individual becomes a nonemployee director. Each incumbent
nonemployee director also is granted an award of 200 shares of restricted Common
Stock at the beginning of each year. The Board has the power to discontinue
granting awards under the Plan at any time.
The shares of restricted Common Stock are registered in the nonemployee
director's name but held by the Corporation and, while restricted, are
nontransferable. The nonemployee director receives cash dividends and has voting
rights during the restricted period. The restricted period expires at the
earlier to occur of the nonemployee director's normal termination of service on
the Board (1) after reaching the age (currently 70) at which the nonemployee
director may no longer stand for reelection or (2) by reason of disability or
death.
Upon expiration of the restricted period, the nonemployee director will
receive the shares free of all restrictions. Should a nonemployee director cease
to be a member of the Board during the restricted period, all of the shares of
restricted Common Stock then held will be forfeited to the Corporation.
Committees of the Board
The Board has established a number of standing committees to assist it in
the discharge of its responsibilities. The principal responsibilities of each
committee are described in the succeeding paragraphs. Actions taken by any
committee of the Board are reported to the Board of Directors, usually at its
next meeting or by written report. Respective memberships on the various
standing committees are identified in the annual report and in the personal
information on each director in this proxy statement, except for Randolph W.
Bromery. Dr. Bromery is chairman of the Nominating Committee, vice chairman of
the Public Issues Committee, and a member of the Executive Committee.
The Audit Committee, consisting of six directors who are not employees of
Exxon or its affiliates, met three times in 1995. Each year it recommends the
appointment of a firm of independent public accountants to examine the financial
statements of the Corporation and its subsidiaries for the coming year. In
making this recommendation, it reviews the nature of audit services rendered, or
to be rendered, to Exxon and its subsidiaries by the independent public
accountants and also reviews the nature of nonaudit-related services rendered to
the Corporation and its subsidiaries. It reviews with
2
representatives of the independent public accountants the auditing arrangements
and scope of the independent public accountants' examination of the financial
statements, results of those audits, their fees, and any problems identified by
the independent public accountants regarding internal accounting controls,
together with their recommendations. It also meets with Exxon's Controller and
the General Auditor to review reports on the functioning of Exxon's programs for
compliance with its policies and procedures regarding ethics and those regarding
financial controls and internal auditing. This includes an assessment of
internal controls within the Corporation and its subsidiaries based upon the
activities of Exxon's internal auditing staffs as well as an evaluation of the
performance of those staffs. The Committee is also prepared to meet at any time
upon request of the independent public accountants, the Controller, or the
General Auditor to review any special situation arising in relation to any of
the foregoing subjects.
The Board Advisory Committee on Contributions consists of five directors.
It met twice in 1995 to review, among other matters, the general levels and
areas of Exxon's financial support for public service programs, including the
Corporation's contributions to the Exxon Education Foundation, which supports
programs to improve the quality of education.
The Board Compensation Committee, consisting of four directors who are not
employees of Exxon or its affiliates, met six times in 1995. The Chief Executive
Officer does not attend Board Compensation Committee meetings, except upon
invitation by the chairman of the Committee. This Committee makes
recommendations to the Board of Directors as to the salary of the Chief
Executive Officer, sets the salaries of the other elected officers, and reviews
salaries of certain other senior executives. It grants incentive compensation to
elected officers and other senior executives and reviews guidelines for the
administration of Exxon's incentive programs. It also reviews and approves or
makes recommendations to the Board of Directors on any proposed plan or program
which would benefit primarily the senior executive group. Each year the
Committee reviews an independent analysis, prepared by a leading public
accounting firm, of the competitiveness of Exxon's top management compensation
and reviews summary results of various salary surveys, as well as competitive
data developed by Exxon's executive compensation staff.
The Finance Committee, consisting of four directors, is responsible for
reviewing the Corporation's financial policies, strategies, and capital
structure. The Committee held one meeting and acted by written consent in lieu
of meeting eight times in 1995. As required, the Board delegates specific
authority to the Committee to act on behalf of the Board in authorizing the
issuance or guarantee of corporate debt and other financial matters.
The Nominating Committee, which met twice in 1995, consists of five
directors who are not employees of Exxon or its affiliates. It recommends to the
Board the director nominees proposed in the proxy statement for election by the
shareholders. It reviews the qualifications of, and recommends to the Board,
candidates to fill Board vacancies as they may occur during the year. The
Committee considers suggestions from shareholders and other sources regarding
possible candidates for director. Such suggestions, together with appropriate
biographical information, should be submitted to the Secretary of the
Corporation. Board-approved guidelines and criteria regarding the qualifications
of candidates for director, insofar as they apply to nonemployees, give
considerable weight to a candidate's experience as a manager of a relatively
large, complex business, educational, or other organization which equips the
individual to deal with complex problems. The Committee also reviews proposed
changes in the compensation and benefits, such as travel accident insurance, of
nonemployee directors. The Committee makes such recommendations to the Board of
Directors as it deems advisable.
The Public Issues Committee, consisting of seven directors, has as its
principal responsibilities the review of the Corporation's policies, programs,
and practices on public issues of significance, including their effects on the
environment, safety, and health. The Committee met twice in 1995 and considered
varying subjects, including reports of reviews undertaken by operating units
with respect to environmental and safety activities. The Committee periodically
tours operating sites to observe and to comment on current practices, including
spill and hazard prevention.
The Executive Committee consists of five directors. Although the Committee
has very broad powers, in practice, it meets only infrequently to take formal
action on a specific matter when it would be impractical to call a meeting of
the Board. The Committee did not meet in 1995. Directors who are not regular
members of the Committee are alternate members and, if necessary to establish a
quorum for a meeting, one or more of them is called to attend the meeting in
accordance with a rotational schedule adopted by the Board.
3
1. ELECTION OF DIRECTORS
Directors are elected to serve until the next annual meeting of
shareholders. Although the Board of Directors does not contemplate that any of
the nominees named will be unavailable for election, in the event a vacancy in
the slate of nominees is occasioned by death or other unexpected occurrence, the
proxy will be voted for the election of a replacement nominee, if one is
designated by the Board.
________________________
Nominees for director
________________________
MICHAEL J. BOSKIN
T. M. Friedman Professor of Economics, and Senior Fellow, Hoover Institution,
Stanford University
Member -- Audit Committee, Finance
Committee, and Public Issues Committee
Director since 1996 Age 50
Exxon shares owned* 1,500
[Photo]
Received bachelor of arts, masters, and Ph.D. degrees in
Economics from the University of California at Berkeley.
Joined Stanford University in 1970, professor since 1978.
Currently the T. M. Friedman Professor of Economics, and
senior fellow of the Hoover Institution. On leave of
absence to chair the President's Council of Economic
Advisors, 1989-93. Adjunct scholar, American Enterprise
Institute; research associate, National Bureau of Economic Research. Director,
Oracle Corporation; HealthCare COMPARE Corporation. Chairman, Congressional
Advisory Commission on the Consumer Price Index. Member, Advisory Committee of
the Joint Committee on Taxation of the U.S. Congress; Panel of Advisors to the
Congressional Budget Office; Economic Advisory Council to the Governor of
California; Los Angeles Times Board of Advisors. Awards include Stanford's
Distinguished Teaching Award; National Association of Business Economists'
Abramson Award for outstanding research and their Distinguished Fellow Award;
Medal of the President of the Italian Republic for contributions to global
economic understanding.
- --------------------------------------------------------------------------------
D. WAYNE CALLOWAY
Chairman of the Board and
Chief Executive Officer, PepsiCo, Inc.
Chairman -- Audit Committee
Member -- Board Compensation Committee
and Finance Committee
Director since 1988 Age 60
Exxon shares owned* 3,900
[Photo]
Received bachelor of business administration degree from
Wake Forest University. Joined PepsiCo, Inc. (beverages,
snack foods, and restaurants) in 1967. Elected president
and chief operating officer of Frito-Lay, Inc. in 1976 and
chairman of the board and chief executive officer in 1978.
Elected executive vice president, chief financial officer,
and director of PepsiCo in 1983, president and chief
operating officer in 1985, and chairman and chief executive officer in 1986.
Retiring as chief executive officer effective April 1, 1996 and remaining as
chairman of the board until February 1, 1997. Director, Citicorp; General
Electric Company. Chairman, Grocery Manufacturers of America. Member, The
Business Council; The Business Roundtable. Chairman, board of trustees, Wake
Forest University.
- --------------------------------------------------------------------------------
*See Notes on page 9.
4
JESS HAY
Chairman, Texas Foundation
for Higher Education
Chairman, HCB Enterprises Inc.
Chairman -- Board Advisory Committee
on Contributions
Member -- Board Compensation
Committee and Executive Committee
Director since 1981 Age 65
Exxon shares owned* 9,400
[Photo]
Received bachelor of business administration degree in
1953 and law degree in 1955 from Southern Methodist
University. Chairman, Texas Foundation for Higher
Education; HCB Enterprises Inc. (private investment firm).
Prior to his retirement in December 1994, served for 29
years as chief executive officer of The Lomas Financial
Group, a diversified financial services group of companies
engaged principally in mortgage banking and real estate lending. Practiced law
in Dallas, Texas prior to joining Lomas in 1965. Director, The Dial Corporation;
SBC Communications Inc.; Trinity Industries, Inc. Member of the board, Greater
Dallas Planning Council; Southwestern Medical Foundation; Texas Research League;
Zale-Lipshy Hospital of Dallas; World War II Memorial Advisory Board; State Fair
of Texas. Member, American, Dallas, and Texas Bar Associations.
- --------------------------------------------------------------------------------
JAMES R. HOUGHTON
Chairman of the Board and
Chief Executive Officer,
Corning Incorporated
Member -- Audit Committee, Finance
Committee, and Public Issues Committee
Director since 1994 Age 60
Exxon shares owned* 3,000
[Photo]
Received bachelor of arts degree in 1958 and master of
business administration degree in 1962 from Harvard
University. Joined Corning Incorporated (specialty glass
and ceramic materials, communications, laboratory
services, and consumer products) in 1962. Elected vice
president and European area manager, Corning Glass
International, S.A. in 1965. Appointed general manager of
the Consumer Products Division and elected vice president of Corning
Incorporated in 1968, director in 1969, vice chairman responsible for
international operations in 1971, and chairman of the board in 1983. Retiring as
chairman of the board and chief executive officer effective April 25, 1996.
Director, Dow Corning Corporation; J. P. Morgan & Co. Incorporated; Metropolitan
Life Insurance Company. Trustee, The Corning Museum of Glass; Corning
Incorporated Foundation; The Metropolitan Museum of Art; The Pierpont Morgan
Library. Member, The Business Council; The Business Roundtable; Council on
Foreign Relations; Harvard Corporation.
- --------------------------------------------------------------------------------
WILLIAM R. HOWELL
Chairman of the Board,
J. C. Penney Company, Inc.
Chairman -- Board Compensation
Committee
Member -- Audit Committee
and Executive Committee
Director since 1982 Age 60
Exxon shares owned* 3,100
[Photo]
Received bachelor of business administration degree from
the University of Oklahoma. Joined J. C. Penney Company,
Inc. (department stores and catalog chain) in 1958.
Elected executive vice president and director in 1981,
vice chairman in 1982, and chairman and chief executive
officer in 1983. Relinquished chief executive officer
position January 1995. Director, Bankers Trust New York
Corporation and Bankers Trust Company; Halliburton Co.; Warner-Lambert Company;
Dallas Citizens Council; National Organization on Disability; National Retail
Federation.
- --------------------------------------------------------------------------------
*See Notes on page 9.
5
PHILIP E. LIPPINCOTT
Retired Chairman and
Chief Executive Officer,
Scott Paper Company
Vice Chairman -- Board Compensation
Committee
Member -- Board Advisory Committee
on Contributions, Executive Committee,
and Nominating Committee
Director since 1986 Age 60
Exxon shares owned* 3,900
[Photo]
Holds bachelor of arts degree from Dartmouth College and a
master of business administration degree in food
distribution from Michigan State University. Joined Scott
Paper Company (sanitary paper, printing and publishing
papers, and forestry operations) in 1959. Elected vice
president -- marketing in 1972, director in 1978,
president and chief operating officer in 1980, chief
executive officer in 1982, and chairman in 1983. Retired April 1994. Director,
Campbell Soup Company. Chairman of the board and director, Fox Chase Cancer
Center. Trustee, The Penn Mutual Life Insurance Company. Board of overseers, The
Dartmouth Institute; The Huntsman Center for Competition and Innovation, The
Wharton School, University of Pennsylvania. Member, The Business Council.
- --------------------------------------------------------------------------------
HARRY J. LONGWELL
Senior Vice President
Member -- Board Advisory Committee
on Contributions and Public Issues
Committee
Director since 1995 Age 54
Exxon shares owned* 60,650
[Photo]
Principal responsibilities include the Corporation's oil,
gas, coal and minerals exploration and production
activities; venture operations in the Commonwealth of
Independent States and China; Exxon Coal and Minerals
Company; Exxon Exploration Company; Exxon Production
Research Company; human resources. Received bachelor's
degree in petroleum engineering from Louisiana State
University in 1963. Joined the Exxon organization in 1963 and held various
managerial positions in domestic and foreign operations. Became vice
president -- production, Exxon Company, U.S.A. in 1983; vice president, Esso
Europe Inc. in 1986; vice president -- exploration and production, senior
vice president -- exploration, production, and gas, and executive vice
president, Exxon Company, International in 1987, 1988, and 1990, respectively;
president, Exxon Company,U.S.A. in 1992. Elected senior vice president in
January 1995 and director of the Corporation in October 1995. Director,
U.S.-China Business Council; Louisiana State University Foundation; United
Way of Dallas. Board of visitors, University of Texas M. D. Anderson Cancer
Center. Member, American Petroleum Institute; Society of Petroleum Engineers.
- --------------------------------------------------------------------------------
*See Notes on page 9.
6
MARILYN CARLSON NELSON
Director and Vice Chairman,
Carlson Holdings, Inc.
Member -- Audit Committee, Board
Advisory Committee on Contributions,
and Nominating Committee
Director since 1991 Age 56
Exxon shares owned* 4,000
[Photo]
Received bachelor's degree in international economics from
Smith College. Joined Carlson Holdings, Inc. (travel,
hotels, restaurants, and marketing services) in 1989 as a
director and senior vice president and became vice
chairman in 1991. Co-chairman, Carlson Wagonlit Global
Travel Company, 1994. Chairman, Citizens State Bank of
Waterville, Minnesota, 1975-94; Citizens State Bank of Montgomery, Minnesota,
1992-94. Director, Carlson Companies, Inc.; First Bank System; U.S. West, Inc.;
Hubert H. Humphrey Institute of Public Affairs; United Way of America, 1984-90.
Trustee, Macalester College, 1974-80; Smith College, 1980-85. Chairman,
Minnesota Super Bowl 1992 Task Force. Member, Bretton Woods Committee; Center
for International Leadership; Committee for Economic Development (CED);
Committee of 200. Awards, Career Achievement, Sales and Marketing Executives of
Minneapolis; Directors' Choice Award, National Women's Economic Alliance
Foundation; Extraordinary Leadership, Greater Minneapolis Chamber of Commerce;
1995 Woman of the Year, Roundtable for Women in Foodservice; 'Others' Award,
Salvation Army. Holds honorary degrees of Doctor of Humane Letters from The
College of St. Catherine and Gustavus Adolphus College.
- --------------------------------------------------------------------------------
LEE R. RAYMOND
Chairman of the Board and
Chief Executive Officer
Chairman -- Executive Committee and
Finance Committee
Director since 1984 Age 57
Exxon shares owned* 101,140
[Photo]
Received bachelor's degree in chemical engineering from
the University of Wisconsin in 1960 and a Ph.D. in the
same discipline from the University of Minnesota in 1963.
That year joined Exxon as a production research engineer
in Tulsa, Oklahoma. Held various positions with Exxon
Company, U.S.A.; Creole Petroleum Corporation; Exxon
International Company; Exxon Enterprises. Became president
of Esso Inter-America Inc. in 1983. Elected senior vice president and director
of the Corporation in 1984, president in 1987, became chairman and chief
executive officer in 1993, and added title of president in 1996. Director, J. P.
Morgan & Co. Incorporated; Morgan Guaranty Trust Company of New York; New
American Schools Development Corporation; United Negro College Fund. Director
and chairman, American Petroleum Institute. Trustee, Southern Methodist
University; Wisconsin Alumni Research Foundation. Member, The Business Council;
The Business Roundtable; Council on Foreign Relations; Emergency Committee for
American Trade; National Petroleum Council; Singapore-U.S. Business Council;
Trilateral Commission; University of Wisconsin Foundation.
- --------------------------------------------------------------------------------
*See Notes on page 9.
7
JOHN H. STEELE
President Emeritus, Corporation of
Woods Hole Oceanographic Institution
Member -- Nominating Committee and
Public Issues Committee
Director since 1989 Age 69
Exxon shares owned* 4,279
[Photo]
Received bachelor of science degree in 1946 and doctorate
of science in 1963 from University College, London
University. With Marine Laboratory, Aberdeen, Scotland as
marine scientist, 1951-66; senior principal scientific
officer, 1966-73; deputy director, 1973-77. Joined Woods
Hole Oceanographic Institution, Massachusetts, in 1977 as
director. Elected president of Corporation of Woods Hole Oceanographic
Institution 1984. Retired November 1991. Award, Alexander Agassiz Medal,
National Academy of Sciences. Trustee, Robert Wood Johnson Foundation. Member,
National Geographic Society's Committee for Research and Exploration. Fellow,
Royal Society of London; American Academy of Arts and Sciences; American
Association for Advancement of Science. Honorary professor, University of
Aberdeen.
- --------------------------------------------------------------------------------
ROBERT E. WILHELM
Senior Vice President
Member -- Board Advisory Committee
on Contributions and Public Issues
Committee
Director since 1992 Age 55
Exxon shares owned* 66,845
[Photo]
Principal responsibilities include the Corporation's
worldwide refining, marketing, and transportation
activities; Exxon Company, U.S.A.; Exxon Research and
Engineering Company; accounting and financial control;
corporate planning. Received bachelor's degree from
Massachusetts Institute of Technology and master of
business administration degree from Harvard University.
Joined the Exxon organization in 1963 and held various managerial positions in
domestic and foreign operations. Became vice president -- petroleum products of
Esso Europe Inc. in 1981; president of Esso Inter-America Inc. in 1984;
executive vice president of Exxon Company, International in 1986. Elected senior
vice president of the Corporation in 1990 and director in 1992. Vice chairman,
Council of the Americas. Board of governors, Foreign Policy Association;
Massachusetts Institute of Technology Political Science Visiting Committee.
Member, Coal Industry Advisory Board of the International Energy Agency; Council
on Foreign Relations. Vice president, Circle 10 Council of Boy Scouts of
America. Trustee, Greenhill School, Dallas, Texas.
- --------------------------------------------------------------------------------
JOSEPH D. WILLIAMS
Retired Chairman of the Board and Chief
Executive Officer, Warner-Lambert
Company
Chairman -- Public Issues Committee
Member -- Audit Committee and
Nominating Committee
Director since 1988 Age 69
Exxon shares owned* 16,689
[Photo]
Received bachelor's degree in chemistry and pharmacy from
the University of Nebraska College of Pharmacy. Joined
Warner-Lambert Company (pharmaceuticals and consumer
health products) in 1950 where he spent all of his
business career. Elected president in 1979, chief
operating officer in 1980, chief executive officer in
January 1985, and chairman of the board in July 1985.
Retired September 1991. Director, AT&T Corp.; J. C. Penney Company, Inc.;
Rockefeller & Co.; Rockefeller Financial Services, Inc.; Thrift Drug Inc.;
Warner-Lambert Company. Board of trustees, Columbia University; Project HOPE;
United Negro College Fund. Chairman, New Jersey Commission on Higher Education.
- --------------------------------------------------------------------------------
*See Notes on page 9.
8
NOTES
* As of January 31, 1996, all directors and nominees beneficially owned (as
this term is interpreted by the Securities and Exchange Commission
('SEC')) an aggregate of 413,465 shares of Exxon Corporation Common Stock,
representing in the case of each director or nominee less than 0.1 percent
of the outstanding shares. The foregoing includes 925 shares held jointly
by Dr. Bromery and his spouse; 25 shares held in an Individual Retirement
Account for Dr. Bromery's spouse; 6,200 shares held in a defined benefit
plan for Mr. Hay; 600 shares held by Mr. Houghton's spouse; 1,350
restricted shares for which Mr. Howell is constructive trustee on behalf
of his former spouse; 22 shares held by Mr. Longwell's spouse; 1,500
shares held in a trust for the benefit of Mrs. Nelson; 600 shares held by
Mr. Raymond's mother over which he has power of attorney; 1,379 shares
held jointly by Dr. Steele and his spouse; 1,535 shares held jointly by
Mr. Wilhelm and his spouse; and 3,111 shares held in trust for the benefit
of Mr. Wilhelm's children. As of the same date, the other executive
officer named in the Summary Compensation Table shown on page 10
beneficially owned (as so interpreted) less than 0.1 percent of the
outstanding shares of Exxon Corporation Common Stock as follows: Mr.
Dahan, 23,716 shares, including 13,596 shares held jointly with his
spouse. As of the same date, all then-current directors and executive
officers as a group beneficially owned (as so interpreted) 799,759 shares
of Exxon Corporation Common Stock, representing in the aggregate less than
0.1 percent of the outstanding shares. Beneficial ownership of certain of
these shares has been, or is being, specifically disclaimed by certain
nominees and officers in ownership reports filed with the SEC.
The trustee of the Corporation's Thrift Plan holds all the outstanding
shares of Exxon Corporation Class A Preferred Stock described on page 18
and has the right to vote such shares. The trustee is comprised of four
Exxon Corporation officers and an officer of a division, none of whom is a
director or nominee.
These amounts do not include shares of Exxon Corporation Common Stock
covered by exercisable options as of January 31, 1996 as follows: Mr.
Raymond, 1,170,000; Mr. Sitter, 704,894; Mr. Longwell, 308,500; Mr.
Wilhelm, 462,000; Mr. Dahan, 175,104; and all then-current directors and
executive officers as a group, 4,438,363. When shares so covered are added
to shares beneficially owned by any director, nominee, or named current or
former executive officer, the percentage for such person, as of January
31, 1996, does not exceed 0.11 percent of the outstanding shares, and the
aggregate for all directors and executive officers as a group, as of the
same date, is less than 0.5 percent.
Transactions with Management
The Corporation and its affiliates have transactions in the ordinary course
of business with unaffiliated corporations of which certain of the nonemployee
directors are executive officers. The Corporation does not consider the amounts
involved in such transactions material by any reasonable standard.
Section 16(a) Reports
Section 16(a) of the Securities Exchange Act of 1934 requires the
Corporation's directors and officers, and persons who own more than ten percent
of a registered class of the Corporation's equity securities, to file, on Forms
3, 4, and 5, reports of ownership and changes in ownership of such securities
with the Securities and Exchange Commission and the New York Stock Exchange. Mr.
W. R. Howell was late in filing one Form 4 to report a transfer of 200 shares of
Common Stock pursuant to a domestic relations order under which marital property
was divided.
9
EXECUTIVE COMPENSATION
Summary Compensation Table
The Summary Compensation Table shows certain compensation information for
the Chief Executive Officer and the four other most highly compensated executive
officers based on 1995 salaries and bonuses. This information includes the
dollar value of base salaries, bonus awards and long term incentive plan
payouts, the number of stock options and stock appreciation rights ('SARs')
granted, restricted stock awards, and certain other compensation, if any,
whether paid or deferred during the fiscal years ended December 31, 1995, 1994,
and 1993.
SUMMARY COMPENSATION TABLE
Annual Compensation Long Term Compensation
-------------------------------------- ------------------------------------
Awards Payouts
-------------------------- -------
Other Annual Restricted Options/ LTIP All Other
Name and Principal Salary Bonus Compensation Stock SARs Payouts Compensation
Position Year ($) ($) ($) Award(s)($)(a) (#) ($)(b) ($)(c)
- -----------------------------------------------------------------------------------------------------------------------------------
L. R. Raymond 1995 1,400,000 1,000,000 93,486(d) 775,000 225,000 798,000 102,816
Chairman and CEO 1994 1,300,000 550,000 16,262 593,750 200,000 348,000 94,224
1993 1,143,333 500,000 15,521 620,000 200,000 255,000 82,046
C. R. Sitter 1995 975,000 500,000 10,494 - 0 - - 0 - 540,000 86,007
President and Director 1994 935,000 350,000 85,273 - 0 - 140,000 240,000 78,663
(Retired 1/31/96) 1993 841,667 325,000 8,654 - 0 - 140,000 189,000 69,307
H. J. Longwell 1995 610,000 300,000 49,316 271,250 90,000 225,000 44,746
Senior Vice President 1994 535,833 160,000 4,822 178,125 75,000 99,000 38,527
and Director 1993 485,833 125,000 4,822 186,000 60,000 75,000 34,825
R. E. Wilhelm 1995 705,000 350,000 6,811 271,250 110,000 357,000 52,116
Senior Vice President 1994 675,000 225,000 6,081 207,813 100,000 153,000 49,569
and Director 1993 625,000 200,000 28,932 217,000 100,000 109,500 45,775
R. Dahan 1995 570,000 300,000 7,620 271,250 90,000 219,000 41,906
Senior Vice President 1994 516,666 150,000 5,337 178,125 70,000 93,000 37,217
and President, Exxon 1993 473,333 125,000 - 0 - 186,000 60,000 75,000 33,973
Company, International
- --------------------------------------------------------------------------------------------------------------------------------
(a) The values set forth in the column above for restricted stock awards are
as of 12/1/95 for 1995, as of 12/1/94 for 1994, and as of 12/1/93 for
1993, the dates of grants of Career Shares. On 12/31/95, these were the
only shares of restricted stock held by the named executive officers. The
number of shares held and their values on 12/31/95 were as follows: Mr.
Raymond, 30,000 shares valued at $2,415,000; Mr. Longwell, 9,500 shares
valued at $764,750; Mr. Wilhelm, 10,500 shares valued at $845,250; and Mr.
Dahan, 9,500 shares valued at $764,750. The 12/31/95 values are based on a
12/29/95 closing market stock price of $80.50 and do not take into account
any diminution of value attributable to the career duration restrictions
on such shares. Normal common dividends are paid on these shares. Career
Shares are described on page 15.
(b) Represents settlements of Earnings Bonus Units ('EBUs'), which the SEC
rules categorize as long term incentive plan ('LTIP') payouts, since EBUs
serve as incentive for performance to occur over a period longer than one
fiscal year. The Corporation, however, considers EBUs to be short term
awards, as described on page 14. Payouts shown for 1993 were for EBUs
awarded in 1990; payouts shown for 1994 were for EBUs awarded in 1991; and
payouts for 1995 were for EBUs awarded in 1992 and 1993.
(c) All Other Compensation for 1995 includes matching credits by the
Corporation under the Corporation's Thrift Plan and the related
supplemental thrift plans ($84,000 for Mr. Raymond; $60,033 for Mr.
Sitter; $38,158 for Mr. Longwell; $43,825 for Mr. Wilhelm; and $35,750 for
Mr. Dahan) and the Corporation's cost allocation of supplemental life
insurance ($18,816 for Mr. Raymond; $25,974 for Mr. Sitter; $6,588 for Mr.
Longwell; $8,291 for Mr. Wilhelm; and $6,156 for Mr. Dahan).
(d) Represents certain perquisites, including membership fees of $47,090.
10
Option Grants in Last Fiscal Year
The following table shows information regarding grants of stock options
made to the named executive officers under Exxon's 1993 Incentive Program during
the fiscal year ended December 31, 1995. The amounts shown for each of the named
executive officers as potential realizable values are based on arbitrarily
assumed annualized rates of stock price appreciation of five percent and ten
percent over the full ten-year term of the options, which would result in stock
prices of approximately $128.67 and $204.45, respectively. The amounts shown as
potential realizable values for all shareholders represent the corresponding
increases in the market value of 1,241,924,268 outstanding shares of Exxon
Corporation Common Stock held by all shareholders (other than the Corporation)
as of January 31, 1996, which would total approximately $61.8 billion and $155.9
billion, respectively. No gain to the optionees is possible without an increase
in stock price which will benefit all shareholders proportionately. These
potential realizable values are based solely on arbitrarily assumed rates of
appreciation required by applicable SEC regulations. Actual gains, if any, on
option exercises and common stockholdings are dependent on the future
performance of Exxon Corporation Common Stock. There can be no assurance that
the potential realizable values shown in this table will be achieved.
OPTION GRANTS IN LAST FISCAL YEAR
Potential Realizable Value at
Assumed Annual Rates of Stock
Individual Grants (a) Price Appreciation for Option Term
---------------------------------------------------------------------------------------------
Number of % of Total
Securities Options If Stock At If Stock At
Underlying Granted to Exercise $128.67 $204.45
Options Employees or Base
Granted in Fiscal Price Expiration 5% 10%
Name (#) Year (b) ($/Sh) Date ($) ($)
- -----------------------------------------------------------------------------------------------------------------------
All Shareholders' N/A N/A N/A N/A 61.8 billion 155.9 billion
Stock Appreciation
L. R. Raymond 225,000 3.8% 78.94 11/29/05 11,189,745 28,240,785
C. R. Sitter - 0 - N/A N/A N/A N/A N/A
H. J. Longwell 90,000 1.5% 78.94 11/29/05 4,475,898 11,296,314
R. E. Wilhelm 110,000 1.9% 78.94 11/29/05 5,470,542 13,806,606
R. Dahan 90,000 1.5% 78.94 11/29/05 4,475,898 11,296,314
- -----------------------------------------------------------------------------------------------------------------------
(a) Stock options are awarded at the fair market value of shares of Exxon
Corporation Common Stock at the date of award and become exercisable one
year from such date if the optionee has not terminated, or upon death if
earlier. Such options lapse at the earliest of ten years after award, five
years after the optionee's normal termination of employment, three years
after the optionee's death, or at the time of the optionee's termination of
employment otherwise than normally. No SARs were awarded in 1995.
(b) Total options granted = 5,892,710
Aggregated Option/SAR Exercises in Last Fiscal Year and Fiscal Year-End
Option/SAR Values
The following table summarizes for each of the named executive officers the
number of stock options and SARs, if any, exercised during the fiscal year ended
December 31, 1995, the aggregate dollar value realized upon exercise, the total
number of unexercised options and SARs, if any, held at December 31, 1995, and
the aggregate dollar value of in-the-money, unexercised options and SARs, if
any, held at December 31, 1995. Value realized upon exercise is the difference
between the fair market value of the underlying stock on the exercise date and
the exercise or base price of the option or SAR. Value of unexercised,
in-the-money options or SARs at fiscal year-end is the difference between their
exercise or base prices and the fair market value of the underlying stock on
December 29, 1995, which was $80.50 per share. These values, unlike the amounts
set forth in the column headed 'Value Realized,' have not been, and may never
be, realized. The underlying options or SARs have not been, and may never be,
exercised; and actual gains, if any, on exercise will depend on the value of
Exxon Corporation Common Stock on the date of exercise. There can be no
assurance that these values will be realized. Unexercisable options are those
which have been held for less than one year.
11
AGGREGATED OPTION/SAR EXERCISES IN LAST FISCAL YEAR
AND FY-END OPTION/SAR VALUES
Number of
Shares Number of Securities
Underlying Underlying Unexercised Value of Unexercised, In-the-Money
Options/SARs Value Options/SARs at FY-End (#) Options/SARs at FY-End ($)*
Exercised Realized ----------------------------------------------------------------------
Name (#) ($) Exercisable Unexercisable Exercisable Unexercisable
- ------------------------------------------------------------------------------------------------------------------------------
L. R. Raymond 100,000 2,994,109 1,170,000 225,000 28,410,000 351,563
C. R. Sitter 250,281 7,586,721 704,894 - 0 - 16,109,946 N/A
H. J. Longwell 25,138 782,770 308,500 90,000 7,169,063 140,625
R. E. Wilhelm 68,559 2,263,407 462,000 110,000 9,937,375 171,875
R. Dahan 37,896 848,037 175,104 90,000 3,356,374 140,625
- ------------------------------------------------------------------------------------------------------------------------------
* In-the-Money Options/SARs are those where the fair market value of the
underlying securities exceeds the exercise or base price of the option or
SAR. The named executive officers hold no other options or SARs.
Long Term Incentive Plans -- Awards in Last Fiscal Year
The following table shows information regarding Earnings Bonus Units
('EBUs') awarded to the named executive officers under Exxon's Short Term
Incentive Program or 1993 Incentive Program during the fiscal year ended
December 31, 1995. Each EBU entitles the holder to an amount in cash equal to
the cumulative net income per share of Exxon Corporation Common Stock, as
announced quarterly commencing with the first full quarter following the date of
award, payable on the fifth anniversary of the unit's date of grant, or earlier
upon achieving the maximum settlement value of $8.50 per unit. Although the
Corporation considers EBUs to be short term awards as described on page 14, the
SEC rules categorize EBUs as long term incentive awards since EBUs serve as
incentive for performance to occur over a period longer than one fiscal year. No
amounts are shown in the table as 'target' or 'threshold' future payouts because
no such payout levels are set or contemplated under the Corporation's Incentive
Programs.
LONG TERM INCENTIVE PLANS -- AWARDS IN LAST FISCAL YEAR
Performance or Estimated Future Payouts Under
Number of Other Period Until Non-Stock Price-Based Plans
Shares, Units or Maturation or ------------------------------
Name Other Rights (#) Payout Maximum ($)
- -----------------------------------------------------------------------------------------
L. R. Raymond 100,000 5 years maximum 850,000
C. R. Sitter 60,000 5 years maximum 510,000
H. J. Longwell 35,000 5 years maximum 297,500
R. E. Wilhelm 41,000 5 years maximum 348,500
R. Dahan 35,000 5 years maximum 297,500
- -----------------------------------------------------------------------------------------
Employee Annuities
Under Exxon's current Annuity Plan, subject to age and service
requirements, an employee acquires a right to a yearly annuity upon retirement.
The yearly annuity is equal to 1.6 percent of the average annual 36-month pay
times years of accredited service, less up to half of the estimated Old Age
Social Security benefit payable. The following table illustrates the approximate
yearly undiscounted annuity which may become payable under the Annuity Plan
and the related supplemental annuity plans to an employee in the higher
salary classifications, including those named in the Summary Compensation Table
shown on page 10. Whether these amounts actually become payable in whole or in
part depends on the contingencies and conditions governing the Annuity Plan.
12
ESTIMATED UNDISCOUNTED ANNUITY
Average Years of Accredited Service
Annual -------------------------------------------------------
36-Month Pay* 30 35 40 45
- --------------------------------------------------------------------------
$ 500,000 $ 240,000 $ 280,000 $ 320,000 $ 360,000
1,000,000 480,000 560,000 640,000 720,000
1,500,000 720,000 840,000 960,000 1,080,000
2,000,000 960,000 1,120,000 1,280,000 1,440,000
2,500,000 1,200,000 1,400,000 1,600,000 1,800,000
3,000,000 1,440,000 1,680,000 1,920,000 2,160,000
3,500,000 1,680,000 1,960,000 2,240,000 2,520,000
- --------------------------------------------------------------------------
* Average annual 36-month pay includes salary for the 36 consecutive months of
highest earnings during the last ten years of employment and short term bonus
awards, including Earnings Bonus Units ('EBUs'). The bonus awards included in
the computation are the highest three awards granted during the final five
years of employment. For purposes of this computation, EBUs are valued at
their maximum settlement value. See the Long Term Incentive Plans table on
page 12 for data on 1995 awards of EBUs to the named executive officers. For
the executive officers named in the Summary Compensation Table on page 10,
average annual 36-month pay includes amounts shown in the 'Salary' and
'Bonus' columns of that table, as well as EBU awards shown in the Long Term
Incentive Plans table.
As of January 31, 1996, average annual 36-month pay and years of accredited
service for the executive officers named in the Summary Compensation Table
are as follows: Mr. Raymond, $2,587,223, 33 years; Mr. Sitter, $1,684,445, 42
years; Mr. Longwell, $934,861, 33 years; Mr. Wilhelm, $1,181,167, 35 years;
and Mr. Dahan, $907,083, 34 years.
The amounts shown above are based on the normal form of annuity under the
Annuity Plan with 60 monthly payments guaranteed and are before deduction for
the estimated Old Age Social Security benefit referred to on page 12.
Board Compensation Committee Report on Executive Compensation
Overview
The Board Compensation Committee ('BCC') consists entirely of nonemployee
directors who are not eligible to participate in any of the compensation plans
or programs it administers. The BCC approves or endorses for approval by the
full Board or shareholders all of the programs under which compensation is paid
or awarded to the Corporation's senior executives.
Exxon's executive compensation program is designed to motivate, reward, and
retain the management talent needed to achieve its business objectives and
maintain its position of leadership in the petroleum industry. The program is
also designed to make a substantial component of senior executives' potential
compensation dependent upon increased shareholder return.
It does this by providing incentives to achieve short-term and long-term
objectives, by rewarding exceptional performance and accomplishments that
contribute to the business, and by utilizing competitive base salaries that
recognize a philosophy of career continuity.
Exxon's financial success is highly dependent upon its long-term capital
investment strategy and decisions that focus on the Corporation's future
results. The nature of the petroleum business requires long-term and capital-
intensive investments, which often take years to generate returns to
shareholders. Therefore, incentive awards are granted with an orientation
towards long-term corporate performance and may not fluctuate as greatly as
year-to-year corporate financial results.
In keeping with this long-term view and the highly technical and
capital-intensive nature of the petroleum business, retention of executives who
have developed the skills and expertise required to lead a global organization
is vital to Exxon's competitive strength. Retention and motivation of these
individuals are, and will continue to be, key to the Corporation's success.
The philosophical basis of the compensation program is to pay for
performance and the level of responsibility of an individual's position.
Assessments of both individual and corporate performance influence executives'
compensation levels. It is important to encourage a performance-based
environment that motivates individual performance by recognizing the past year's
results and by providing incentives for further improvement in the future. This
includes the ability to implement the Corporation's business plans as well as to
react to unanticipated external factors that can have a significant impact on
corporate performance. Compensation decisions for all executives, including the
Chief Executive Officer ('CEO') and the other named executive officers, are
based on the same criteria.
13
There are three major components of Exxon's compensation program: Base
Salary, Short Term Awards, and Long Term Incentive Awards.
Base Salary
A competitive base salary is vital to support the philosophy of management
development and career orientation of executives and is consistent with the
long-term nature of Exxon's business.
Salary budget expenditures and adjustments to the salary program structure
are a result of annual reviews of competitive positioning (how Exxon's salary
structure for comparable positions compares with that of other companies),
business performance, and general economic factors. While there is no specific
weighting of these factors, competitive positioning is the primary consideration
in setting the salary budget expenditures. Business and other economic factors,
such as net income and estimates of inflation, are secondary considerations. In
determining competitive position, a number of surveys are utilized. Primary
consideration is given to the U.S.-based oil companies included in the industry
group used for comparing share investment performance on page 16. Foreign-based
oil companies used in the industry group are excluded since their compensation
structures for executive officers are not considered comparable. Additional
consideration is given to other major U.S.-based corporations because the scope
of Exxon's business extends beyond the oil industry, as does competition for
executives. Consequently, major U.S.-based corporations in the same or similar
lines of business as Exxon, as well as a number of those in other lines of
business but with which Exxon competes for executives, are included. Competitive
orientation of salary ranges is targeted between the median and high end of
survey data given Exxon's size and complexity relative to the surveyed
companies. Within this framework, executive salaries are determined based on
individual performance, level of responsibility, and experience.
The BCC makes recommendations to the Board of Directors as to the salaries
of the CEO and the President, sets the salaries of the other elected officers,
and reviews salaries of certain other senior executives. The BCC met in November
1994 to recommend the 1995 salaries for the CEO and President, to set the 1995
salaries for the other elected officers, and to review the 1995 salaries for
certain other senior executives. Any changes to these approved salaries must be
reviewed with the BCC before implementation.
The CEO's salary is determined based on the competitive salary framework
described above, recognizing the Corporation's size and complexity. Within this
framework, the CEO's salary is determined based on the BCC's judgment concerning
the CEO's individual contributions to the business, level of responsibility, and
career experience. Although none of these factors has a specific weight, primary
consideration is given to the CEO's individual contributions to the business. No
particular formulas or measures are used. L. R. Raymond's salary reflects his
strong leadership and significant individual contributions to Exxon's business.
Short Term Awards
Short term awards to executives are granted in cash and Earnings Bonus
Units ('EBUs') to recognize contributions to the business during the past year.
EBUs are also granted to focus on a strong midterm corporate performance and to
stress that decisions and contributions in any one year impact future years. In
1995, approximately one half of executive bonuses were in the form of EBUs. Each
such EBU entitles the holder to an amount equal to the cumulative net income per
share, as announced quarterly, commencing with the first full quarter following
the date of award, payable on the fifth anniversary of the unit's date of grant
or earlier upon achieving the maximum settlement value of $8.50 per unit. The
EBU maximum settlement value was raised in 1995 from $7.50 to $8.50 per unit
which raises the earnings performance target to a higher level. In 1995, the
maximum settlement value was achieved for the EBUs granted in 1992 and 1993.
This resulted in a payment to grantees of $7.50 per unit.
The BCC annually establishes a ceiling in relation to business results for
awards of cash and EBUs. The BCC established a $55 million ceiling for 1995
awards of cash and EBUs, substantially all of which were granted in awards to
over 1,000 employees. The ceiling is determined by Exxon's competitive position,
assessment of progress in attainment of long-term goals, and business
performance considerations. These include measurements such as net income,
earnings per share, return on capital employed, return on equity, and dividends
both in absolute terms and relative to the industry. None of these measurements
has a specific weight. The 1995 ceiling was increased from the 1994 ceiling. No
formula was used in determining the ceiling amount. Rather, the BCC considered
several factors, including Exxon's record earnings and business performance,
continued strengthening of the Corporation's worldwide competitive position, and
its achievement towards attainment of long-range strategic goals.
The specific bonus opportunity an executive receives is dependent on
individual performance and level of responsibility. Assessment of an
individual's relative performance is made annually based on a number of factors
which include initiative, business judgment, technical expertise, and management
skills.
L. R. Raymond's 1995 award reflects his level of responsibility within the
organization and his leadership which significantly contributed to achievement
of record corporate earnings and continued strengthening of the Corporation's
worldwide competitive position. This determination was based on the judgment of
the BCC regarding his overall contribution as CEO utilizing negative discretion
as described below under '1993 Federal Income Tax Legislation.' Narrow
quantitative
14
measures or formulas are not viewed as sufficiently comprehensive for this
purpose. The combination of Mr. Raymond's base salary and short term awards was
appropriately positioned compared to CEOs of competitors, as well as the size
and business results of these companies relative to Exxon.
Long Term Incentive Awards
Long term incentive awards provided by the shareholder-approved 1993
Incentive Program are designed to develop and retain strong management through
share ownership and incentive awards.
Stock options were the primary long term incentive granted to executive
officers and over 1,300 other key employees in 1995. The BCC believes that a
significant portion of senior executives' compensation should be dependent on
value created for the shareholders. Options are an excellent vehicle to
accomplish this by tying the executives' interests directly to the shareholders'
interests. Options are granted at the fair market value of Exxon Common Stock on
the date of grant and become exercisable one year from such date if the optionee
is still employed.
The number of options that the BCC grants to executive officers is based on
individual performance (determined as described under 'Short Term Awards')
and level of responsibility. The award level must be sufficient in size to
provide a strong incentive for executives to work for long-term business
interests and become significant owners of the business. The number of options
currently held by an executive was not a factor in determining individual grants
since such a factor would create an incentive to exercise options and sell the
shares.
A limited number of senior executives received grants of Career Shares in
1995. Career Shares are shares of Exxon Common Stock granted with a restriction
designed to promote long-term retention, as well as superior long-term
performance, of key strategic and operating management. These restrictions
generally expire after the executive reaches normal retirement age. The number
of Career Shares granted to senior executives also recognizes the increased
responsibility and complexity of senior positions. Individual grants are based
on personal contribution and level of responsibility within the organization.
The number of shares currently held by an executive was not a factor in
determining individual grants since Career Shares are primarily designed to
promote long-term retention.
L. R. Raymond's long term incentive awards reflect his level of
responsibility within the organization and his leadership which significantly
contributed to Exxon's corporate performance. Mr. Raymond's long term incentive
awards reflect the BCC's judgment of his overall contribution as CEO. In making
this determination, the BCC considered the complex, highly technical, and long-
term nature of the business. Narrow quantitative measures or formulas are not
viewed as sufficiently comprehensive for this purpose.
1993 Federal Income Tax Legislation
The federal income tax law limits the deductibility of certain compensation
paid to the CEO and the four other most highly compensated executives in excess
of the statutory maximum.
The value of all stock options granted in 1995, any value received from
stock options granted in prior years and exercised in 1995, and EBUs that were
granted in 1992 and 1993 and paid out in 1995 are exempt from this limit.
Short term awards (consisting of cash bonuses and EBUs) granted in 1995 to
the CEO and a limited number of senior executives, are also exempt from the
limit on deductibility. For 1995, the BCC established an upper limit on certain
awards dependent on attainment of a broad performance measure based on earnings
per share. From this limit, it was intended that the BCC would exercise
discretion to reduce or eliminate the amount of the actual award to any
individual such that actual awards would be equal to the amounts determined to
be appropriate in accordance with the qualitative criteria and other factors
discussed above under 'Short Term Awards.' Upon achievement of the measure, the
BCC exercised such discretion with respect to the cash bonuses and EBUs granted
to the CEO and such senior executives. This approach continues to give the BCC
the broad flexibility it previously had to determine short term incentive
compensation while allowing this compensation to be deductible for federal
income tax purposes.
Summary
The BCC has the responsibility for ensuring that Exxon's compensation
program continues to be in the best interest of its shareholders. The BCC is
guided by an independent analysis, prepared by a leading public accounting firm,
of the competitiveness of Exxon's executive compensation. The results of various
salary surveys are also reviewed. Finally, compensation programs providing
stock-based compensation to executives, such as the 1993 Incentive Program, are
periodically submitted to shareholders for review and approval.
Exxon has had, and continues to have, an appropriate and competitive
compensation program. The balance of a sound base salary position, competitive
short term bonus orientation, and emphasis on long term incentives is the
foundation which builds stability and supports Exxon's business.
William R. Howell, Chairman D. Wayne Calloway
Philip E. Lippincott, Vice Chairman Jess Hay
15
Share Investment Performance
The following graphs show changes over the past five- and ten-year periods
in the value of $100 invested in: (1) Exxon Corporation Common Stock; (2) the
Standard & Poor's 500 Index; and (3) an industry group of seven other
international, integrated major oil companies: Amoco Corporation, The British
Petroleum Company p.l.c., Chevron Corporation, Mobil Corporation, Royal Dutch
Petroleum Company, The 'Shell' Transport and Trading Company, p.l.c., and Texaco
Inc. Investments in the industry group of other international, major oil
companies have been prorated based on the companies' relative market
capitalizations at the beginning of each year.
The values of each investment are based on share price appreciation plus
dividends, with reinvestment of dividends. The calculations exclude trading
commissions and taxes. For The British Petroleum Company p.l.c., Royal Dutch
Petroleum Company, and The 'Shell' Transport and Trading Company, p.l.c., the
calculations are based on investments in American depository receipts; dividends
are before any withholding taxes, but include any applicable U.K. advance
corporation tax credits.
FIVE-YEAR CUMULATIVE TOTAL RETURNS
Value of $100 Invested at Year-End 1990
[PERFORMANCE GRAPH]
Fiscal Years Ended December 31
-----------------------------------------------
1990 1991 1992 1993 1994 1995
-----------------------------------------------
EXXON CORPORATION 100 123 130 140 141 195
S&P 500 100 130 140 155 157 215
INDUSTRY GROUP 100 106 103 134 148 195
TEN-YEAR CUMULATIVE TOTAL RETURNS
Value of $100 Invested at Year-End 1985
[PERFORMANCE GRAPH]
Fiscal Years Ended December 31
------------------------------------------------------
1985 1986 1987 1988 1989 1990 1991 1992 1993 1994 1995
------------------------------------------------------
EXXON CORPORATION 100 135 153 186 222 241 297 313 338 341 470
S&P 500 100 119 125 145 191 185 242 260 287 290 399
INDUSTRY GROUP 100 140 163 183 263 287 305 295 383 424 560
BOARD OF DIRECTORS PROPOSAL
2. Ratification of the appointment of independent public accountants
The following proposal will be offered by the Board of Directors:
Resolved, That the appointment, by the Board of Directors of the
Corporation, of Price Waterhouse LLP as independent public accountants to make
an examination of the accounts of the Corporation and its subsidiary companies
for the fiscal year 1996, effective upon ratification by the shareholders, be,
and it hereby is, ratified; and that a representative of Price Waterhouse LLP be
requested to attend the annual meeting of shareholders to be held in 1997.
16
BOARD OF DIRECTORS RECOMMENDATION --
The Board recommends a vote FOR this proposal.
Price Waterhouse LLP has offices in most countries where affiliates of the
Corporation operate, which is an essential requirement. The Board believes that
Price Waterhouse LLP has demonstrated that it is well qualified to make an
independent examination of the accounts of the Corporation. Representatives of
Price Waterhouse LLP will be present at the 1996 annual meeting of shareholders
and will have the opportunity to make such statements as they may desire. Those
representatives will also be available to respond to appropriate questions from
the shareholders present.
The services provided by Price Waterhouse LLP include examinations of the
Corporation's annual consolidated financial statements, statutory examinations
of affiliated companies' financial statements, examination of financial
statements of employee benefit plans, certification of various special-purpose
financial reports and reports to comply with regulations of the Securities and
Exchange Commission and other governmental agencies, the preparation of tax
returns for employees on foreign assignments insofar as such tax returns pertain
to their assignments outside their home countries, and assistance and advice to
various affiliates with respect to certain tax and systems matters. The total
professional fees for all such services for the most recent year approximated
$17 million.
SHAREHOLDER PROPOSAL
A shareholder has stated her intention to present the following proposal at
the 1996 annual meeting. In accordance with applicable proxy regulations of the
SEC, the shareholdings of the proponent will be furnished by the Corporation to
any person, orally or in writing as requested, promptly upon the receipt of any
oral or written request therefor addressed to the Secretary of the Corporation.
The proposal and supporting statement, for which the Board of Directors and the
Corporation accept no responsibility, are set forth below. The Board opposes
this proposal for the reasons stated after the proposal.
3. Additional reporting of political contributions
This proposal was submitted by Mrs. Evelyn Y. Davis, Watergate Office
Building, 2600 Virginia Avenue, N.W., Suite 215, Washington, DC 20037.
'Resolved, That the shareholders recommend that the Board direct management
that within five days after approval by the shareholders of this proposal, the
management shall publish in newspapers of general circulation in the cities of
New York, Washington, D.C., Detroit, Chicago, San Francisco, Los Angeles,
Dallas, Houston and Miami, and in the Wall Street Journal and U.S.A. Today, a
detailed statement of each contribution made by the Company, either directly or
indirectly, within the immediately preceding fiscal year, in respect of a
political campaign, political party, referendum or citizens' initiative, or
attempts to influence legislation, specifying the date and amount of each such
contribution, and the person or organization to whom the contribution was made.
Subsequent to this initial disclosure, the management shall cause like data to
be included in each succeeding report to shareholders. And if no such
disbursements were made, to have that fact publicized in the same manner.'
Reasons: 'This proposal, if adopted, would require the management to advise
the shareholders how many corporate dollars are being spent for political
purposes and to specify what political causes the management seeks to promote
with those funds. It is therefore no more than a requirement that the
shareholders be given a more detailed accounting of these special purpose
expenditures that they now receive. These political contributions are made with
dollars that belong to the shareholders as a group and they are entitled to know
how they are being spent.
If you AGREE, please mark your proxy FOR this proposal.'
BOARD OF DIRECTORS RECOMMENDATION --
The Board recommends a vote AGAINST this proposal.
A similar proposal was presented by this same proponent at Exxon's 1975,
1976, and 1984 annual meetings, and each time it was rejected by shareholders
owning more than 96 percent of the shares voted.
Exxon Corporation makes limited contributions to political candidates or
political parties, which are fully in keeping with applicable laws. Eligible
management and administrative employees and selected retirees who wish to
participate in the political process are given the opportunity to do so by
contributing to candidates through the Exxon Corporation Political Action
Committee and the Exxon Corporation Political Action Committee of Texas (the
'Exxon PACs'). As required by applicable federal and state election laws,
information about political contributions made by the Corporation and the Exxon
PACs is publicly available.
The Corporation legally may, and as a matter of policy does, take positions
with respect to proposed legislation and ballot propositions or referenda which
could affect the business activities of the Corporation and the shareholders'
investment in it. It communicates such positions in a variety of ways, including
testimony before congressional and other legislative committees, articles in
company publications which shareholders receive, and occasionally, special
letters to shareholders. From time to
17
time, subject to strict management review, the Corporation provides financial
support to citizens' groups which are taking positions for or against ballot
propositions or referenda having an important impact on the Corporation. The
Corporation also belongs to various trade and other associations which take
public positions on such matters.
In view of the Corporation's policies and practices in this area, the Board
of Directors believes that this proposal would result in publishing information
that is already publicly available and create an unnecessary expense.
Accordingly, as it did in the past when similar proposals were under
consideration, the Board of Directors recommends a vote AGAINST this proposal.
ADDITIONAL INFORMATION
Other Business
It is not anticipated that there will be presented to the meeting any
business other than the election of directors and the proposals described
herein, and the Board of Directors was not aware, a reasonable time before this
solicitation of proxies, of any other matters which might properly be presented
for action at the meeting. If any other business should come before the meeting,
the persons named on the enclosed proxy card will have discretionary authority
to vote all proxies in accordance with their best judgment.
Outstanding Voting Stock
Shareholders of record at the close of business on February 26, 1996 are
entitled to notice of the meeting and to vote the shares held on that date. At
the close of business on January 31, 1996, excluding the shares owned by the
Corporation which are not voted, 1,241,924,268 shares of the Common Stock of the
Corporation were outstanding. As of the same date, 7,280,636 shares of the
Corporation's Class A Preferred Stock were outstanding. Holders of shares of
Common Stock and holders of Class A Preferred Stock vote together as one class.
Each share of Common Stock and of Class A Preferred Stock entitles the
registered holder thereof to one vote.
Solicitation of Proxies
This proxy is solicited by the Board of Directors of the Corporation. The
cost of soliciting proxies in the accompanying form has been, or will be, borne
by the Corporation. In addition to solicitation by mail, banks, brokers and
other custodians, nominees, and fiduciaries will be requested to send proxy
material to the beneficial owners and to secure their voting instructions, if
necessary. The Corporation will reimburse them for their expenses in so doing.
Officers and other employees of the Corporation may solicit proxies
personally, by telephone, or other telecommunications from some shareholders if
proxies are not received promptly. In addition, the firm of D. F. King & Co.,
Inc., New York, NY has been retained to assist in the solicitation of proxies at
a fee of $25,000, plus expenses.
By order of the Board of Directors,
/s/ T. P. TOWNSEND
T. P. TOWNSEND
Secretary
March 12, 1996
18
[Logo]
Printed on recycled paper.
APPENDIX 1
PROXY CARD
[DALLAS AREA MAP] [STREET MAP]
From I-45/Hwy 75--Take I-35 exit (Woodall Rodgers Frwy) to Pearl St.
exit or St. Paul exit (follow frontage road east to Pearl St.), turn south
and continue to Ross Ave., turn left to Arts District Garage.
From I-35E--Take I-45/Hwy 75 exit (Woodall Rodgers Frwy) to Pearl St.
exit, continue to Ross Ave., turn left to Arts District Garage.
From DFW Airport--Take South Exit to Hwy 183 east
(merges with I-35E), follow directions from I-35E (above).
From Love Field--Exit airport on Mockingbird Ln. west to I-35E south,
follow directions from I-35E (above).
[LOGO]
EXXON CORPORATION PROXY
SOLICITED BY BOARD OF DIRECTORS
5959 Las Colinas Boulevard ANNUAL MEETING APRIL 24, 1996
Irving, TX 75039-2298 DALLAS, TEXAS
The undersigned hereby appoints J. Hay, W.R. Howell, P.E. Lippincott, L.R.
Raymond, and J.D. Williams or each or any of them, with power of substitution,
proxies for the undersigned to act and vote at the 1996 annual meeting of
shareholders of Exxon Corporation and at any adjournments thereof, as indicated,
upon all matters referred to on the reverse side and described in the proxy
statement for the meeting and, in their discretion, upon any other matters which
may properly come before the meeting.
1. Election of Directors
Nominees: M.J. Boskin, D.W. Calloway,
J. Hay, J.R. Houghton, W.R. Howell,
P.E. Lippincott, H.J. Longwell, M.C. Nelson,
L.R. Raymond, J.H. Steele, R.E. Wilhelm,
J.D. Williams.
IF NO OTHER INDICATION IS MADE, THE PROXIES SHALL VOTE (A) FOR THE ELECTION OF
THE DIRECTOR NOMINEES AND (B) IN ACCORDANCE WITH THE RECOMMENDATIONS OF THE
BOARD OF DIRECTORS ON THE OTHER MATTERS REFERRED TO ON THE REVERSE SIDE.
P.O. Box 9157
Boston, MA 02205-8505
PLEASE COMPLETE, SIGN, DATE, AND RETURN PROMPTLY IN ENCLOSED ENVELOPE. (OVER)
-----------------------------------------------------------------------------
EXXON CORPORATION 1996 ANNUAL MEETING
ADMISSION TICKET
TO AVOID DELAY AT THE ENTRANCE
TO THE MEETING, PLEASE PRESENT
THIS TICKET.
You are cordially invited to attend the annual meeting of shareholders on
Wednesday, April 24 at the Morton H. Meyerson Symphony Center, 2301 Flora
Street, Dallas, Texas. The meeting will begin at 10:00 a.m., Central Daylight
Time. Admission is limited to shareholders, their proxies, and guests of the
Corporation. This ticket will admit you and a guest. Free parking is available
in the Arts District Garage. Have your parking ticket validated at the annual
meeting. Please allow extra time for parking.
DETACH TICKET
- --------------------------------------------------------------------------------
EXXON CORPORATION
Attached below is a proxy card for the 1996 annual meeting of shareholders of
Exxon Corporation.
Please mark the boxes on the proxy card to indicate how your shares should be
voted. Sign, date, and return your proxy as soon as possible in the enclosed
postpaid envelope.
Votes are tallied by Bank of Boston, Exxon Corporation's transfer agent. Any
comments noted on the proxy card or an attachment will be forwarded by Bank of
Boston to Exxon Corporation.
Advance indications of attendance are helpful to us in making arrangements for
the meeting. If you plan to attend, mark the box provided on the proxy card. The
attached admission ticket should be presented at the meeting to expedite
registration.
DETACH CARD BEFORE MAILING
- --------------------------------------------------------------------------------
[X] Please mark votes as in this example.
WITHHELD
FOR ALL FROM ALL
nominees nominees
1. Election of
Directors
(page 4). [ ] [ ]
- --------------------------------------
For all nominees except as noted above
A vote FOR is recommended by the Board of Directors:
FOR AGAINST ABSTAIN
2. Appointment of
independent public accountants
(page 16). [ ] [ ] [ ]
A vote AGAINST is recommended
by the Board of Directors as to the
shareholder proposal concerning:
FOR AGAINST ABSTAIN
3. Additional reporting
of political contributions
(page 17). [ ] [ ] [ ]
Discontinue duplicate annual report. [ ]
I plan to attend the annual meeting. [ ]
I have made comments on this card or an attachment. [ ]
NOTE: Please sign exactly as name appears hereon. When signing as attorney,
executor, administrator, trustee, or guardian, please give full name as such.
Signature Date 1996 Signature Date 1996
------------------------ --------------- ------------------------ ---------------
