Back to GetFilings.com
1998
- - -------------------------------------------------------------------------------
- - -------------------------------------------------------------------------------
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
----------------
FORM 10-K
[ X ] ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF
THE SECURITIES EXCHANGE ACT OF 1934
For the fiscal year ended December 31, 1998
OR
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF
THE SECURITIES EXCHANGE ACT OF 1934
For the transition period from to
Commission File Number 1-2256
EXXON CORPORATION
(Exact name of registrant as specified in its charter)
NEW JERSEY 13-5409005
(State or other jurisdiction of (I.R.S. Employer Identification
incorporation or organization) Number)
5959 LAS COLINAS BOULEVARD, IRVING, TEXAS 75039-2298
(Address of principal executive offices) (Zip Code)
(972) 444-1000
(Registrant's telephone number, including area code)
----------------
Securities registered pursuant to Section 12(b) of the Act:
Name of Each Exchange
Title of Each Class on Which Registered
------------------- -----------------------
Common Stock, without par value (2,427,925,038 shares
outstanding at February 26, 1999) New York Stock Exchange
Registered securities guaranteed by Registrant:
SeaRiver Maritime Financial Holdings, Inc.
Twenty-Five Year Debt Securities due October 1, 2011 New York Stock Exchange
Exxon Capital Corporation
Twelve Year 6% Notes due July 1, 2005 New York Stock Exchange
Indicate by check mark whether the registrant (1) has filed all reports
required to be filed by Section 13 or 15(d) of the Securities Exchange Act of
1934 during the preceding 12 months (or for such shorter period that the
registrant was required to file such reports), and (2) has been subject to
such filing requirements for the past 90 days. Yes X No
--- ---
Indicate by check mark if disclosure of delinquent filers pursuant to Item
405 of Regulation S-K is not contained herein, and will not be contained, to
the best of registrant's knowledge, in definitive proxy or information
statements incorporated by reference in Part III of this Form 10-K or any
amendment to this Form 10-K.
---
The aggregate market value of the voting stock held by non-affiliates of the
registrant on February 26, 1999, based on the closing price on that date of
$66 9/16 on the New York Stock Exchange composite tape, was in excess of $161
billion.
Documents Incorporated by Reference:
1998 Annual Report to Shareholders (Parts I, II and IV)
Proxy Statement for the 1999 Annual Meeting of Shareholders (Part III)
- - -------------------------------------------------------------------------------
- - -------------------------------------------------------------------------------
EXXON CORPORATION
FORM 10-K
FOR THE FISCAL YEAR ENDED DECEMBER 31, 1998
TABLE OF CONTENTS
Page
Number
------
PART I
Item 1. Business..................................................... 1-2
Item 2. Properties................................................... 2-9
Item 3. Legal Proceedings............................................ 9
Item 4. Submission of Matters to a Vote of Security Holders.......... 9
Executive Officers of the Registrant [pursuant to Instruction 3 to Reg-
ulation S-K, Item 401(b)]............................................. 9
PART II
Item 5. Market for Registrant's Common Stock and Related Shareholder
Matters...................................................... 10
Item 6. Selected Financial Data...................................... 10
Item 7. Management's Discussion and Analysis of Financial Condition
and Results of Operations.................................... 10
Item 7A. Quantitative and Qualitative Disclosures About Market Risk... 10
Item 8. Financial Statements and Supplementary Data.................. 10
Item 9. Changes in and Disagreements with Accountants on Accounting
and Financial Disclosure..................................... 10
PART III
Item 10. Directors and Executive Officers of the Registrant........... 10
Item 11. Executive Compensation....................................... 10
Item 12. Security Ownership of Certain Beneficial Owners and
Management................................................... 11
Item 13. Certain Relationships and Related Transactions............... 11
PART IV
Item 14. Exhibits, Financial Statement Schedules and Reports on Form
8-K.......................................................... 11
Signatures............................................................. 12-13
Index to Financial Statements.......................................... 14
Consent of Independent Accountants..................................... 14
Index to Exhibits...................................................... 15
PART I
Item 1. Business.
Exxon Corporation was incorporated in the State of New Jersey in 1882.
Divisions and affiliated companies of Exxon operate or market products in the
United States and over 100 other countries. Their principal business is
energy, involving exploration for, and production of, crude oil and natural
gas, manufacturing of petroleum products and transportation and sale of crude
oil, natural gas and petroleum products. Exxon Chemical Company, a division of
Exxon, is a major manufacturer and marketer of basic petrochemicals, including
olefins and aromatics, and a leading supplier of specialty rubbers and of
additives for fuels and lubricants. Other products manufactured include
polyethylene and polypropylene plastics, plasticizers, specialty resins,
specialty and commodity solvents and performance chemicals for oil field
operations. Exxon is engaged in exploration for, and mining and sale of, coal,
copper and other minerals. Exxon also has interests in electric power
generation facilities. Affiliates of Exxon conduct extensive research programs
in support of these businesses.
Exxon Corporation has five divisions and hundreds of affiliates, many with
names that include Exxon or Esso. For convenience and simplicity, in this
report the terms Exxon and Esso, as well as the terms corporation, company,
our, we and its, are sometimes used as abbreviated references to specific
affiliates or groups of affiliates. The precise meaning depends on the context
in question.
On December 1, 1998, Exxon Corporation and Mobil Corporation signed an
agreement to merge the two companies subject to shareholder approval,
regulatory reviews and other conditions. Under the terms of the agreement,
each common share of Mobil will be converted into 1.32015 common shares of
Exxon. As a result of the merger, Exxon shareholders will own about 70 percent
of the combined company and Mobil shareholders will own about 30 percent. Upon
completion of the merger, the company's name will be Exxon Mobil Corporation.
It is intended that the merger will qualify as a tax-free reorganization in
the U.S., and that it will be accounted for on a "pooling of interests" basis.
In addition, the merger agreement provides for payment of termination fees of
$1.5 billion under certain circumstances. Exxon and Mobil also have entered
into an option agreement that grants Exxon the option under specified
circumstances to purchase up to approximately 14.9 percent of the authorized
but unissued common stock of Mobil.
The oil and chemical industries are highly competitive. There is competition
within the industries and also with other industries in supplying the energy,
fuel and chemical needs of commerce, industry and individuals. The corporation
competes with other firms in the sale or purchase of various goods or services
in many national and international markets and employs all methods of
competition which are lawful and appropriate for such purposes.
The operations and earnings of the corporation and its affiliates throughout
the world have been, and may in the future be, affected from time to time in
varying degree by political developments and laws and regulations, such as
forced divestiture of assets; restrictions on production, imports and exports;
price controls; tax increases and retroactive tax claims; expropriations of
property; cancellation of contract rights and environmental regulations. Both
the likelihood of such occurrences and their overall effect upon the
corporation vary greatly from country to country and are not predictable.
The operations and earnings of the corporation and its affiliates throughout
the world are also affected by local, regional and global events or conditions
that affect supply and demand for oil, natural gas and other Exxon products.
These events or conditions are generally not predictable and include, among
other things, the development of new supply sources; supply disruptions;
weather; international political events; technological advances; changes in
demographics and consumer preferences; and the competitiveness of alternative
energy sources or product substitutes. See also page F6 and F7 of the
accompanying financial section of the 1998 Annual Report to shareholders for
discussion of the impact of market risks, inflation and other uncertainties.
In 1998, the corporation spent $1,321 million (of which $432 million were
capital expenditures) on environmental conservation projects and expenses
worldwide, mostly dealing with air and water
conservation. Total expenditures for such activities are expected to be about
$1.5 billion in both 1999 and 2000 (with capital expenditures representing
about 40 percent of the total).
Operating data and industry segment information for the corporation are
contained on pages F3, F24, F25 and F31, information on oil and gas reserves
is contained on pages F28 and F29 and information on company-sponsored
research and development activities is contained on page F16 of the
accompanying financial section of the 1998 Annual Report to shareholders.*
Projections, estimates and descriptions of Exxon's plans and objectives
included or incorporated in Items 1, 2 and 7 of this report are forward-
looking statements. Actual future project dates, production rates, capital
expenditures, costs and business plans could differ materially due to, among
other things, the outcome of commercial negotiations; changes in operating
conditions and costs; technical difficulties; and other factors discussed
above and elsewhere in this report.
Item 2. Properties.
Part of the information in response to this item and to the Securities
Exchange Act Industry Guide 2 is contained in the accompanying financial
section of the 1998 Annual Report to shareholders in Note 10, which note
appears on page F18, and on pages F3, and F26 through F31.
Information with regard to oil and gas producing activities follows:
1. Net Reserves of Crude Oil and Natural Gas Liquids (millions of barrels) and
Natural Gas (billions of cubic feet) at Year-End 1998
Estimated proved reserves are shown on pages F28 and F29 of the accompanying
financial section of the 1998 Annual Report to shareholders. No major
discovery or other favorable or adverse event has occurred since December 31,
1998 that would cause a significant change in the estimated proved reserves as
of that date. For information on the standardized measure of discounted future
net cash flows relating to proved oil and gas reserves, see page F30 of the
accompanying financial section of the 1998 Annual Report to shareholders.
2. Estimates of Total Net Proved Oil and Gas Reserves Filed with Other Federal
Agencies
During 1998, the company filed proved reserves estimates with the U.S.
Department of Energy on Forms EIA-23 and EIA-28. The information is consistent
with the 1997 Annual Report to shareholders with the exception of EIA-23 which
covered total oil and gas reserves from Exxon-operated properties in the U.S.
and does not include gas plant liquids. The difference between the oil
reserves reported on EIA-23 and those reported in the 1997 Annual Report
exceeds five percent. The difference in gas reserves does not exceed five
percent.
3. Average Sales Prices and Production Costs per Unit of Production
Incorporated by reference to page F26 of the accompanying financial section
of the 1998 Annual Report to shareholders. Average sales prices have been
calculated by using sales quantities from our own production as the divisor.
Average production costs have been computed by using net production quantities
for the divisor. The volumes of crude oil and natural gas liquids (NGL)
production used for this computation are shown in the reserves table on page
F28 of the accompanying financial section of the 1998 Annual Report to
shareholders. The net production volumes of natural gas available for sale by
the producing function used in this calculation are shown on page F31 of the
accompanying financial section of the 1998 Annual Report to shareholders. The
volumes of natural gas were converted to oil-equivalent barrels based on a
conversion factor of six thousand cubic feet per barrel.
- - --------
*Only the data appearing on pages F1 and F3 through F31 of the accompanying
financial section of the 1998 Annual Report to shareholders, incorporated in
this report as Exhibit 13, are deemed to be filed as part of this Annual
Report on Form 10-K as indicated under Items 1, 2, 3, 5, 6, 7, 7A, 8 and 14
and on page 14.
2
4. Gross and Net Productive Wells
Year-End 1998
-------------------------
Oil Gas
------------- -----------
Gross Net Gross Net
------ ------ ----- -----
United States...................................... 15,978 5,490 4,116 1,742
Canada............................................. 5,915 3,946 4,014 1,880
Europe............................................. 1,485 438 1,088 366
Asia-Pacific....................................... 890 462 530 149
Other.............................................. 751 86 13 5
------ ------ ----- -----
Total............................................. 25,019 10,422 9,761 4,142
====== ====== ===== =====
5. Gross and Net Developed Acreage
Year-End 1998
--------------------
Gross Net
--------- ---------
(Thousands of acres)
United States........................................... 5,037 3,505
Canada.................................................. 3,066 1,222
Europe.................................................. 10,518 3,327
Asia-Pacific............................................ 2,949 1,130
Other................................................... 7,452 1,105
---------- ---------
Total.................................................. 29,022 10,289
========== =========
Note: Separate acreage data for oil and gas are not maintained because, in
many instances, both are produced from the same acreage.
6. Gross and Net Undeveloped Acreage
Year-End 1998
--------------------
Gross Net
--------- ---------
(Thousands of acres)
United States........................................... 6,739 4,839
Canada.................................................. 3,821 2,174
Europe.................................................. 13,117 5,522
Asia-Pacific............................................ 57,841 30,277
Other................................................... 57,563 24,685
---------- ---------
Total.................................................. 139,081 67,497
========== =========
7. Summary of Acreage Terms in Key Areas
United States
Oil and gas exploration leases are acquired for varying periods of time,
ranging from one to ten years. Producing leases normally remain in effect
until production ceases.
Canada
Exploration permits are granted for varying periods of time with renewals
possible. Production leases are held as long as there is production on the
lease.
Cold Lake oil sands leases were taken for an initial 21-year term in 1968-
1969 and renewed for a second 21-year term in 1989-1990.
3
France
Exploration permits are granted for periods of three to five years,
renewable up to two times accompanied by substantial acreage relinquishments:
50 percent of the acreage at first renewal; 25 percent of the remaining
acreage at second renewal. A 1994 law requires a bidding process prior to
granting of an exploration permit. Upon discovery of commercial hydrocarbons,
a production concession is granted for up to 50 years, renewable in periods of
25 years each.
Germany
Acreage holdings are generally concessions with indefinite periods subject
to minimum work commitments.
Netherlands
Onshore: Exploration drilling permits are issued for a period of two to five
years. Production concessions are granted after discoveries have been made
under conditions which are negotiated with the government. Normally, they are
field-life concessions covering an area defined by hydrocarbon occurrences.
Offshore: Prospecting licenses issued prior to March 1976 were for a 15-year
period, with relinquishment of about 50 percent of the original area required
at the end of ten years. Subsequent licenses are for ten years with
relinquishment of about 50 percent of the original area required after six
years. For commercial discoveries within a prospecting license, a production
license is issued for a 40-year period.
Norway
Licenses issued prior to 1972 were for a total period of 46 years, with
relinquishment of at least one-fourth of the original area required at the end
of the sixth year and another one-fourth at the end of the ninth year.
Subsequent licenses are for a total period of 36 years, with relinquishment of
at least one-half of the original area required at the end of the sixth year.
United Kingdom
Licenses issued prior to 1977 were for an initial period of six years with
an option to extend the license for a further 40 years on no more than half of
the license area. Licenses issued between 1977 and 1979 were for an initial
period of four years, after which one-third of the acreage was required to be
relinquished, followed by a second period of three years, after which an
additional one-third of the acreage was required to be relinquished, with an
option to extend for a total license period of 24 to 36 years on no more than
half the license area. The more recent licenses were typically for an initial
period of six to nine years, with a second term of 12 to 15 years which may be
extended a further 18 to 24 years. In the most recent eighteenth license
round, the initial period was six years, with a second term of 12 years which
may be extended a further 18 years.
Australia
Onshore: Acreage terms are fixed by the individual state and territory
governments. These terms and conditions vary significantly between the states
and territories. Exploration permits are normally
4
granted for four years with possible renewals and relinquishments. Production
licenses in South Australia are granted for an initial term of 21 years, with
subsequent renewals each for 21 years for the full area. Production licenses
in Queensland are granted for varying periods consistent with expected field
lives, with renewals on a similar basis.
Offshore: Acreage terms are fixed by the federal government. Exploration
permits are granted for six years with possible renewals of five-year periods
to a total of 26 years. A 50 percent relinquishment of remaining area is
mandatory at the end of each renewal period. Existing production licenses
include initial license periods of 21 years and a first renewal of an
additional 21 years. From September 1, 1998, new licenses and renewals of
existing licenses will be granted for the life of the field plus five years.
For licenses issued before September 1, 1998, first renewals shall be granted;
second renewals may be granted subject to compliance with conditions of the
license and regulations.
Malaysia
Exploration and production activities are governed by production sharing
contracts negotiated with the national oil company. The more recent contracts
have an overall term of 24 to 37 years with possible extensions to the
exploration or development periods. The exploration period is five to seven
years with the possibility of extensions, after which time areas with no
commercial discoveries must be relinquished. The development period is four to
five years from commercial discovery, with the possibility of extensions under
special circumstances. Areas from which commercial production has not started
by the end of the development period must be relinquished. If no extension is
granted, the total production period is 15 to 25 years from first commercial
lifting, not to exceed the overall term of the contract.
Thailand
The Exxon concessions and the Petroleum Act of 1972 allow production for 30
years (through 2021) with a possible ten-year extension at terms generally
prevalent at the time.
Angola
Exploration and production activities are governed by production sharing
agreements negotiated with the national oil company. The exploration period
generally consists of four years and an optional phase of two years, with no
relinquishment requirement after the first phase. The production period, which
includes development, is for 25 years.
Azerbaijan
The production sharing agreement (PSA) for development of the Megastructure
is for an initial period of 30 years starting from the PSA execution date in
1994.
Republic of Yemen
Production sharing agreements (PSAs) negotiated with the government entitle
Exxon to participate in exploration operations within a designated area during
the exploration period. In the event of a commercial oil discovery, the
company is entitled to proceed with development and production operations
during the development period. The length of these periods and other specific
terms are negotiated prior to executing the production sharing agreement.
Existing production operations have a development period extending 20 years
from first commercial declaration made in November 1985 for the Marib PSA and
June 1995 for the Jannah PSA. In addition, agreement was reached in 1997 on
terms for participation in a potential liquified natural gas project utilizing
Marib gas reserves.
5
8. Number of Net Productive and Dry Wells Drilled
1998 1997 1996
---- ---- ----
A. Net Productive Exploratory Wells Drilled
United States................................................. 7 9 7
Canada........................................................ 3 11 8
Europe........................................................ 7 9 7
Asia-Pacific.................................................. 4 10 7
Other......................................................... 3 2 2
--- --- ---
Total........................................................ 24 41 31
--- --- ---
B. Net Dry Exploratory Wells Drilled
United States................................................. 7 4 5
Canada........................................................ 2 4 4
Europe........................................................ 8 8 9
Asia-Pacific.................................................. 4 3 8
Other......................................................... 5 3 2
--- --- ---
Total........................................................ 26 22 28
--- --- ---
C. Net Productive Development Wells Drilled
United States................................................. 175 228 190
Canada........................................................ 100 424 356
Europe........................................................ 40 33 36
Asia-Pacific.................................................. 55 54 31
Other......................................................... 4 7 11
--- --- ---
Total........................................................ 374 746 624
--- --- ---
D. Net Dry Development Wells Drilled
United States................................................. 20 15 13
Canada........................................................ -- 2 2
Europe........................................................ 2 -- 2
Asia-Pacific.................................................. 1 -- 1
Other......................................................... -- 1 1
--- --- ---
Total........................................................ 23 18 19
--- --- ---
Total number of net wells drilled............................. 447 827 702
=== === ===
9. Present Activities
A. Wells Drilling -- Year-End 1998
Gross Net
----- ---
United States................................................. 108 46
Canada........................................................ 3 1
Europe........................................................ 36 11
Asia-Pacific.................................................. 16 7
Other......................................................... 10 3
--- ---
Total........................................................ 173 68
=== ===
6
B. Review of Principal Ongoing Activities in Key Areas
UNITED STATES
During 1998, exploration activities were conducted by Exxon Exploration
Company, selected development activities by Exxon Upstream Development Company
and producing and other development activities by Exxon Company, U.S.A. Some
of the more significant ongoing activities are:
. Exploration and delineation of additional hydrocarbon resources
continued. At year-end 1998, Exxon's inventory of undeveloped acreage
totaled 4.8 million net acres. Exxon was active in areas onshore and
offshore in the lower 48 states and in Alaska. A total of 13.5 net
exploration and delineation wells were completed during 1998.
. During 1998, 141.3 net development wells were completed within and
around mature fields in the inland lower 48 states.
. Exxon's net acreage in the Gulf of Mexico at year-end 1998 was 2.2
million acres. A total of 27.2 net exploratory and development wells
were completed during the year.
. Development continued on two Gulf of Mexico projects in 1998. The
Genesis project started up in early 1999 utilizing a deep-draft caisson
vessel (DDCV) to develop reserves in 2,600 feet of water. The Ursa
project, scheduled for start-up in 1999, will utilize a tension leg
platform development concept in 3,900 feet of water.
. The Hoover and Diana fields in the Gulf of Mexico are being jointly
developed using a DDCV positioned in 4,800 feet of water over the Hoover
field. The Diana field will be produced via subsea development wells
tied back to the DDCV. Start-up is expected in 2000.
. Participation in Alaska production and development continued and a total
of 27.3 net development wells were drilled in 1998.
CANADA
During 1998, exploration and production activities in Canada were conducted
by the Resources Division of Imperial Oil Limited, which is 69.6 percent owned
by Exxon Corporation. Some of the more significant ongoing activities are:
. Gross commercial bitumen production from Cold Lake averaged 137 thousand
barrels per day during 1998.
. Facilities construction and drilling began in 1998 on the Sable Offshore
Energy Project. Production is expected to begin by 2000.
OUTSIDE NORTH AMERICA
During 1998, exploration activities were conducted by Exxon Exploration
Company, selected development activities by Exxon Upstream Development Company
and producing and other development activities by Exxon Company,
International. Some of the more significant ongoing activities include:
France
Exxon's net acreage at year-end 1998 was 1.0 million net acres (0.7 million
offshore, 0.3 million onshore), with 2.5 net exploration and development wells
completed during the year. During 1998, production started up from the Tamaris
field and development activity is progressing in the Courbey field.
7
Germany
A total of 2.5 million acres were held by Exxon at year-end, with 4.6 net
exploration and development wells drilled and completed during the year.
Netherlands
Exxon's interest in licenses totaled 2.9 million net acres at year-end 1998.
During 1998, 11.5 net exploration and development wells were drilled. During
1998, the new offshore gas fields K7-FC/FD, L9 and Q16-FA started up.
Construction is in progress on the new offshore gas field, D15-FA/FB, and new
onshore gas fields, Moddergat, Nes and Gaag.
Norway
Exxon's net interest in licenses at year-end 1998 totaled 0.5 million net
acres, all offshore. Exxon participated in 14.7 net exploration and production
wells in 1998. Projects for development of the Balder, Jotun and Snorre North
fields are in progress.
United Kingdom
During the year, Exxon acquired interests in 36 new blocks. Net acreage was
1.9 million acres at year-end, all offshore. A total of 24.6 net exploration
and development wells were completed during the year. There were successful
start-ups of the Mallard, ETAP and Galleon PG projects. Low pressure
operations were being implemented at Brent, and several major projects were
underway, including Shearwater, Ketch, Corvette and Triton.
Australia
Exxon's year-end acreage holdings totaled 5.7 million net acres onshore and
0.6 million net acres offshore, with exploration and production activities
underway in both areas. During 1998, a total of 28.3 net exploration and
development wells were completed.
Malaysia
Exxon has interests in production sharing contracts covering 7.6 million net
acres offshore Malaysia. During the year, a total of 34.0 net exploration and
development wells were completed. Development drilling was completed at
Lawit A and Raya A and continued on the Seligi F platform. The Tapis E platform
was installed in 1998. An agreement with PETRONAS, the state-owned oil company,
was signed in 1998 for a major new natural gas production sharing contract. This
contract covers the commercialization of gas previously discovered by Exxon.
Thailand
Exxon's net acreage in the Khorat concession totaled 15 thousand net acres
at year-end.
Angola
Exxon has interests in production sharing agreements covering 2.1 million
net acres, all offshore. During 1998, a total of 2.8 net exploration and
development wells were completed. Development is in progress on the Girassol
field in Block 17.
Azerbaijan
At year-end, Exxon's net acreage totaled 43 thousand acres. During 1998, 0.4
net exploration and development wells were drilled. Construction on the
Western Route pipeline is in progress.
Republic of Yemen
Exxon's net acreage in the Republic of Yemen production sharing areas
totaled 0.9 million acres onshore at year-end. During the year, 4.4 net
exploration and development wells were drilled and completed.
8
WORLDWIDE EXPLORATION
Exploration activities were underway in several areas in which Exxon has no
established production operations. A total of 40.0 million net acres were held
at year-end, and 6.5 net exploration wells were completed during the year.
Item 3. Legal Proceedings.
Refer to the relevant portions of Note 18 on page F23 of the accompanying
financial section of the 1998 Annual Report to shareholders for information on
legal proceedings.
Item 4. Submission of Matters to a Vote of Security Holders.
None.
----------------
Executive Officers of the Registrant [pursuant to Instruction 3 to Regulation
S-K, Item 401(b)].
Age as of
March 31,
Name 1999 Title (Held Office Since)
---- --------- ---------------------------------------------
L. R. Raymond....... 60 Chairman of the Board (1993)
R. Dahan............ 57 Senior Vice President (1995)
H. J. Longwell...... 57 Senior Vice President (1995)
R. E. Wilhelm....... 58 Senior Vice President (1990)
A. L. Condray....... 56 Vice President (1995)
D. D. Humphreys..... 51 Vice President and Controller (1997)
C. W. Matthews...... 54 Vice President and General Counsel (1995)
S. R. McGill........ 56 Vice President (1998)
J. T. McMillan...... 62 Vice President (1997)
F. A. Risch......... 56 Vice President and Treasurer (1999)
D. S. Sanders....... 59 Vice President (1999)
P. E. Sullivan...... 55 Vice President and General Tax Counsel (1995)
J. L. Thompson...... 59 Vice President (1991)
T. P. Townsend...... 62 Vice President -- Investor Relations (1990)
and Secretary (1995)
For at least the past five years, Messrs. Raymond, Wilhelm, Risch and
Townsend have been employed as executives of the registrant. Mr. Raymond also
holds the title of president.
The following executive officers of the registrant have also served as
executives of the subsidiaries, affiliates or divisions of the registrant
shown opposite their names during the five years preceding December 31, 1998.
Esso Benelux B.V. ..................... McGill
Esso Holding Company Holland Inc. ..... McGill
Esso Malaysia Berhad................... Humphreys
Esso Production Malaysia Inc. ......... Humphreys
Exxon Chemical Company................. Sanders
Exxon Coal and Minerals Company........ McMillan
Exxon Company, International........... Dahan and McGill
Exxon Company, U.S.A................... Condray, Longwell, Matthews, McMillan
and Sullivan
Exxon Exploration Company.............. Thompson
Officers are generally elected by the Board of Directors at its meeting on
the day of each annual election of directors, each such officer to serve until
his or her successor has been elected and qualified.
9
PART II
Item 5. Market for Registrant's Common Stock and Related Shareholder Matters.
Incorporated by reference to the quarterly information which appears on page
F4 of the accompanying financial section of the 1998 Annual Report to
shareholders.
In accordance with the registrant's 1997 Nonemployee Director Restricted
Stock Plan, each incumbent nonemployee director (9 persons) was granted 600
shares of restricted stock on January 1, 1999. These grants are exempt from
registration under bonus stock interpretations such as the "no-action" letter
to Pacific Telesis Group (June 30, 1992).
Item 6. Selected Financial Data.
Incorporated by reference to page F3 of the accompanying financial section
of the 1998 Annual Report to shareholders.
Item 7. Management's Discussion and Analysis of Financial Condition and
Results of Operations.
Incorporated by reference to pages F5 through F9 of the accompanying
financial section of the 1998 Annual Report to shareholders.
Item 7A. Quantitative and Qualitative Disclosures About Market Risk.
Incorporated by reference to the first through sixth paragraphs of the
section entitled "Market Risks, Inflation, and Other Uncertainties" beginning
on page F6 and to the tenth paragraph of the section entitled "Liquidity and
Capital Resources" on page F8 of the accompanying financial section of the
1998 Annual Report to shareholders. All statements other than historical
information incorporated in this Item 7A are forward looking statements. The
actual impact of future market changes could differ materially due to, among
other things, factors discussed in this report.
Item 8. Financial Statements and Supplementary Data.
Reference is made to the Index to Financial Statements on page 14 of this
Annual Report on Form 10-K.
Item 9. Changes in and Disagreements with Accountants on Accounting and
Financial Disclosure.
None.
PART III
Item 10. Directors and Executive Officers of the Registrant.
Incorporated by reference to the sections entitled "Board of Directors
Proposal: Election of Directors" and "Section 16(a) Beneficial Ownership
Reporting Compliance" in Chapter Four of the registrant's definitive proxy
statement for the 1999 annual meeting of shareholders (the "1999 Proxy
Statement").
Item 11. Executive Compensation.
Incorporated by reference to the section entitled "Director Compensation"
and the section entitled "Executive Compensation Tables" in Chapter Four of
the registrant's 1999 Proxy Statement.
10
Item 12. Security Ownership of Certain Beneficial Owners and Management.
Incorporated by reference to the section entitled "Director and Executive
Officer Stock Ownership" in Chapter Four of the registrant's 1999 Proxy
Statement.
Item 13. Certain Relationships and Related Transactions.
None.
PART IV
Item 14. Exhibits, Financial Statement Schedules and Reports on Form 8-K.
(a)(1) and (a) (2) Financial Statements:
See Index to Financial Statements on page 14 of this Annual Report on
Form 10-K.
(a)(3) Exhibits:
See Index to Exhibits on page 15 of this Annual Report on Form 10-K.
(b)Reports on Form 8-K.
The registrant filed a Form 8-K dated December 1, 1998 concerning the
announcement by Exxon Corporation and Mobil Corporation of the signing
of an agreement to merge the two companies. Refer to the section
entitled "Exxon and Mobil Merger Agreement" on page F6 of the
accompanying financial section of the 1998 Annual Report to
shareholders for further information regarding this announcement.
11
SIGNATURES
Pursuant to the requirements of Section 13 of the Securities Exchange Act of
1934, the registrant has duly caused this report to be signed on its behalf by
the undersigned, thereunto duly authorized.
EXXON CORPORATION
By: /s/ LEE R. RAYMOND
----------------------------------
(Lee R. Raymond,
Chairman of the Board)
Dated March 30, 1999
----------------
POWER OF ATTORNEY
Each person whose signature appears below constitutes and appoints Millie P.
Bradley, Richard E. Gutman and Brian A. Maher, and each of them, his or her
true and lawful attorneys-in-fact and agents, with full power of substitution
and resubstitution, for him or her and in his or her name, place and stead, in
any and all capacities, to sign any and all amendments to this Annual Report
on Form 10-K, and to file the same, with all exhibits thereto, and other
documents in connection therewith, with the Securities and Exchange
Commission, granting unto said attorneys-in-fact and agents, and each of them,
full power and authority to do and perform each and every act and thing
requisite and necessary to be done, as fully to all intents and purposes as he
or she might or could do in person, hereby ratifying and confirming all that
said attorneys-in-fact and agents or any of them, or their or his or her
substitute or substitutes, may lawfully do or cause to be done by virtue
hereof.
----------------
Pursuant to the requirements of the Securities Exchange Act of 1934, this
report has been signed below by the following persons on behalf of the
registrant and in the capacities and on the dates indicated.
/s/ LEE R. RAYMOND Chairman of the Board March 30, 1999
______________________________________ (Principal Executive
(Lee R. Raymond) Officer)
/s/ MICHAEL J. BOSKIN Director March 30, 1999
______________________________________
(Michael J. Boskin)
/s/ RENE DAHAN Director March 30, 1999
______________________________________
(Rene Dahan)
12
/s/ WILLIAM T. ESREY Director March 30, 1999
______________________________________
(William T. Esrey)
/s/ JESS HAY Director March 30, 1999
______________________________________
(Jess Hay)
/s/ JAMES R. HOUGHTON Director March 30, 1999
______________________________________
(James R. Houghton)
/s/ WILLIAM R. HOWELL Director March 30, 1999
______________________________________
(William R. Howell)
/s/ REATHA CLARK KING Director March 30, 1999
______________________________________
(Reatha Clark King)
/s/ PHILIP E. LIPPINCOTT Director March 30, 1999
______________________________________
(Philip E. Lippincott)
/s/ HARRY J. LONGWELL Director March 30, 1999
______________________________________
(Harry J. Longwell)
/s/ MARILYN CARLSON NELSON Director March 30, 1999
______________________________________
(Marilyn Carlson Nelson)
/s/ WALTER V. SHIPLEY Director March 30, 1999
______________________________________
(Walter V. Shipley)
/s/ ROBERT E. WILHELM Director March 30, 1999
______________________________________
(Robert E. Wilhelm)
/s/ DONALD D. HUMPHREYS Controller (Principal March 30, 1999
______________________________________ Accounting Officer)
(Donald D. Humphreys)
/s/ FRANK A. RISCH Treasurer (Principal March 30, 1999
______________________________________ Financial Officer)
(Frank A. Risch)
13
INDEX TO FINANCIAL STATEMENTS
The consolidated financial statements, together with the report thereon of
PricewaterhouseCoopers LLP dated February 24, 1999, appearing on pages F10 to
F25; the Quarterly Information appearing on page F4; and the Supplemental
Information on Oil and Gas Exploration and Production Activities appearing on
pages F26 to F30 of the accompanying financial section of the 1998 Annual
Report to shareholders are incorporated in this Annual Report on Form 10-K as
Exhibit 13. With the exception of the aforementioned information, no other
data appearing in the accompanying financial section of the 1998 Annual Report
to shareholders is deemed to be filed as part of this Annual Report on Form
10-K under Item 8. Consolidated Financial Statement Schedules have been
omitted because they are not applicable or the required information is shown
in the consolidated financial statements or notes thereto.
CONSENT OF INDEPENDENT ACCOUNTANTS
We hereby consent to the incorporation by reference in the following
Prospectuses constituting part of the Registration Statements on:
Form S-3 (Nos. 333-27489 --Exxon Corporation Shareholder Investment Program;
and 33-60677)
Form S-3 (No. 33-48919) --Guaranteed Debt Securities and Warrants to Purchase
Guaranteed Debt Securities of Exxon Capital Corporation;
Form S-3 (No. 33-8922) --Guaranteed Debt Securities of SeaRiver Maritime
Financial Holdings, Inc. (formerly Exxon Shipping
Company)
and we hereby consent to the incorporation by reference in the Registration
Statements on:
Form S-8 (Nos. 333-38917 --1993 Incentive Program of Exxon Corporation (together
and 33-51107) with 1988 Long Term Incentive Plan of Exxon
Corporation);
Form S-8 (No. 333-72955) --Thrift Plans of Exxon Corporation and Participating
Affiliated Employers
of our report dated February 24, 1999 appearing on page F10 of the
accompanying financial section of the 1998 Annual Report to shareholders of
Exxon Corporation which is incorporated as Exhibit 13 in this Annual Report on
Form 10-K.
PricewaterhouseCoopers LLP
Dallas, Texas
March 30, 1999
14
INDEX TO EXHIBITS
3(i). Registrant's Restated Certificate of Incorporation, as
restated March 17, 1997 (incorporated by reference to
Exhibit 3(i) to the registrant's Quarterly Report on Form
10-Q for the quarter ended March 31, 1997).
3(ii). Registrant's By-Laws, as revised to January 31, 1996
(incorporated by reference to Exhibit 3(ii) to the
registrant's Annual Report on Form 10-K for 1995).
10(iii)(a). Registrant's 1993 Incentive Program, as amended
(incorporated by reference to Exhibit 10(iii)(a) to the
registrant's Quarterly Report on Form 10-Q for the
quarter ended June 30, 1997).*
10(iii)(b). Registrant's Plan for Deferral of Nonemployee Director
Compensation and Fees, as amended.*
10(iii)(c). Registrant's Restricted Stock Plan for Nonemployee
Directors, as amended (incorporated by reference to
Exhibit 10(iii)(c) to the registrant's Annual Report on
Form 10-K for 1996).*
10(iii)(d). Supplemental life insurance (incorporated by reference to
Exhibit 10(iii)(d) to the registrant's Annual Report on
Form 10-K for 1997).*
10(iii)(e). Registrant's Short Term Incentive Program, as amended
(incorporated by reference to Exhibit 10(iii)(e) to the
registrant's Quarterly Report on Form 10-Q for the
quarter ended June 30, 1997).*
10(iii)(f). Registrant's 1997 Nonemployee Director Restricted Stock
Plan (incorporated by reference to Exhibit 10(iii)(f) to
the registrant's Annual Report on Form 10-K for 1996).*
12. Computation of ratio of earnings to fixed charges.
13. Pages F1 and F3 through F31 of the Financial Section of
the registrant's 1998 Annual Report to shareholders.
21. Subsidiaries of the registrant.
23. Consent of Independent Accountants (contained on page 14
of this Annual Report on Form 10-K).
27.1 Financial Data Schedule (included only in the electronic
filing of this document).
27.2 Restated Financial Data Schedules (included only in the
electronic filing of this document. Restated 1998 interim
periods to reflect adoption in the fourth quarter of 1998
of the American Institute of Certified Public
Accountants' Statement of Position 98-5, "Reporting on
the Costs of Start-up Activities", effective as of
January 1, 1998, and the de-consolidation in the fourth
quarter of 1998 of majority owned power segment companies
retroactive to January 1, 1998 in compliance with
Financial Accounting Standards Board Emerging Issues Task
Force ruling on Issue No. 96-16).
- - --------
* Compensatory plan or arrangement required to be identified pursuant to Item
14(a)(3) of this Annual Report on Form 10-K.
The registrant has not filed with this report copies of the instruments
defining the rights of holders of long-term debt of the registrant and its
subsidiaries for which consolidated or unconsolidated financial statements are
required to be filed. The registrant agrees to furnish a copy of any such
instrument to the Securities and Exchange Commission upon request.
15