LOUISIANA LAND & EXPLORATION CO, DEF 14A, 1994-03-28

LOUISIANA LAND & EXPLORATION CO
DEF 14A, 1994-03-28
CRUDE PETROLEUM & NATURAL GAS

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<PAGE> 1

SCHEDULE 14A INFORMATION
PROXY STATEMENT PURSUANT TO SECTION 14(A) OF THE
SECURITIES EXCHANGE ACT OF 1934

Filed by the Registrant /X/
Filed by a Party other than the Registrant / /
Check the appropriate box:
/ / Preliminary Proxy Statement
/X/ Definitive Proxy Statement
/ / Definitive Additional Materials
/ / Soliciting Material Pursuant to sec. 240.14a-11(c) or sec. 240.14a-12

THE LOUISIANA LAND AND EXPLORATION COMPANY
- --------------------------------------------------------------------------------
(Name of Registrant as Specified in Its Charter)

THE LOUISIANA LAND AND EXPLORATION COMPANY
- --------------------------------------------------------------------------------
(Name of Person(s) Filing Proxy Statement)
Payment of filing fee (Check the appropriate box):
/X/ $125 per Exchange Act Rules 0-11(1)(ii), 14a-6(i)(1), or 14a-6(j)(2).
/ / $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:

- --------------------------------------------------------------------------------
(2) Aggregate number of securities to which transaction applies:

- --------------------------------------------------------------------------------
(3) Per unit or other underlying value of transaction computed pursuant to
Exchange Act Rule 0-11:

- --------------------------------------------------------------------------------
(4) Proposed maximum aggregate value of transaction:

- --------------------------------------------------------------------------------
/ / Check box if any part of the fee is offset as provided by Exchange Act
Rule 0-11(a)(2) and identify the filing for which the offsetting fee was paid
previously. Identify the previous filing by registration statement number, or
the Form or Schedule and the date of its filing.

(1) Amount previously paid:

- --------------------------------------------------------------------------------
(2) Form, Schedule or Registration Statement No.:

- --------------------------------------------------------------------------------
(3) Filing party:

- --------------------------------------------------------------------------------
(4) Date filed:

- --------------------------------------------------------------------------------
<PAGE> 2

(LOUISIANA LAND AND EXPLORATION LOGO)

THE LOUISIANA LAND AND EXPLORATION COMPANY
909 Poydras Street
P.O. Box 60350
New Orleans, Louisiana 70160

March 28, 1994

Dear Fellow Stockholder:

You are cordially invited to attend the Annual Meeting of Stockholders of
The Louisiana Land and Exploration Company scheduled to be held on Thursday, May
12, 1994 at the Pan American Life Auditorium, 11th Floor, Pan American Life
Center, 601 Poydras Street, New Orleans, Louisiana commencing at 9:00 A.M.,
Central Daylight Time. Your Board of Directors and management look forward to
greeting personally those stockholders able to attend.

At the meeting, stockholders are being asked to elect a Board of twelve
Directors to serve for a term of one year and to transact such other business as
may properly come before the meeting.

It is important that your shares are represented at the meeting whether or
not you plan to attend. Accordingly, we request your cooperation by promptly
signing, dating and mailing the enclosed proxy in the envelope provided for your
convenience.

Sincerely,

/s/ H. LEIGHTON STEWARD
H. Leighton Steward
Chairman of the Board, President
and Chief Executive Officer
<PAGE> 3

THE LOUISIANA LAND AND EXPLORATION COMPANY
909 Poydras Street
P.O. Box 60350
New Orleans, Louisiana 70160

------------------------

NOTICE OF ANNUAL MEETING OF STOCKHOLDERS
AND PROXY STATEMENT

------------------------

To the Stockholders of
THE LOUISIANA LAND AND EXPLORATION COMPANY:

The Annual Meeting of Stockholders of The Louisiana Land and Exploration
Company (the "Company") will be held on Thursday, May 12, 1994 at 9:00 A.M.,
Central Daylight Time, in the Pan American Life Auditorium, 11th Floor, Pan
American Life Center, 601 Poydras Street, New Orleans, Louisiana, for the
following purposes:

(i) To elect a Board of Directors to serve until the next Annual
Meeting of Stockholders and until their successors are elected and qualify;
and

(ii) To transact such other business as may properly come before the
meeting.

A copy of the Company's Annual Report to Stockholders for the year 1993 is
enclosed.

YOUR VOTE IS IMPORTANT. IF YOU DO NOT EXPECT TO BE PRESENT AT THE MEETING
AND WISH YOUR STOCK TO BE VOTED, PLEASE SIGN AND DATE THE ENCLOSED PROXY AND
MAIL IT PROMPTLY IN THE ENCLOSED REPLY ENVELOPE ADDRESSED TO FIRST CHICAGO TRUST
COMPANY OF NEW YORK, P.O. BOX 8257, EDISON, NEW JERSEY 08818-9089.

SOLICITATION AND REVOCATION OF PROXIES

Proxies are being solicited on behalf of the Board of Directors of the
Company, and the Company will bear the cost of such solicitation. It is expected
that the solicitation of Proxies will be primarily by mail. Proxies may also be
solicited by officers and employees of the Company at no additional cost to the
Company, in person or by telephone, telegram or other means of communication.
The Company may reimburse custodians, nominees and fiduciaries holding Capital
Stock (as defined below) for their reasonable expenses in sending proxy material
to principals and obtaining their Proxy. In addition, the Company has engaged
D.F. King & Co., Inc., 77 Water Street, New York, New York, to assist in such
solicitation at an estimated fee of $9,500 plus disbursements. Any stockholder
giving a Proxy may revoke it at any time before it is exercised by written
notice to the Corporate Secretary of the Company or by voting in person at the
meeting.

It is expected that this Notice of Annual Meeting of Stockholders and Proxy
Statement will first be mailed to stockholders on or about March 28, 1994.

STOCKHOLDERS ENTITLED TO VOTE AND SHARES OUTSTANDING

Only stockholders of record at the close of business on March 15, 1994 will
be entitled to vote at the Annual Meeting. On that date there were 33,193,885
shares of the Capital Stock, par value $.15 per share, of the Company ("Capital
Stock") outstanding and entitled to be voted at the Annual Meeting. Each such
share is entitled to one vote. Proxies marked as abstaining (including proxies
containing broker non-votes) on any matter to be acted upon by stockholders will
be treated as present at the meeting for purposes of determining a quorum but
will not be counted as votes cast on such matters.

1
<PAGE> 4

BENEFICIAL OWNERSHIP OF SECURITIES

The following table reflects the holdings of the only persons known to the
Company to own beneficially 5% or more of Capital Stock.

<TABLE>
<CAPTION>
PERCENT
AMOUNT AND OF
NATURE OF CLASS ON
NAME AND ADDRESS BENEFICIAL MARCH 15,
OF BENEFICIAL OWNER OWNERSHIP 1994
------------------- ---------- ---------
<S> <C> <C>
Fund American Enterprises Holdings, Inc........ 5,210,200 shares(1) 15.7%
The 1820 House
Main Street
Norwich, Vermont 05055
FMR Corp....................................... 4,281,160 shares(2) 12.9%
82 Devonshire Street
Boston, Massachusetts 02109
Metropolitan Life Insurance Company............ 2,041,650 shares(3) 6.2%
One Madison Avenue
New York, New York 10010
</TABLE>

- ---------------

(1) Based on a Schedule 13D dated August 24, 1993 and Forms 4 dated January 7,
1994 and February 8, 1994 filed with the Securities and Exchange Commission
(the "Commission") by Fund American Enterprises Holdings, Inc. ("FAEH"), the
parent of Fund American Enterprises, Inc. and the indirect parent of Source
One Mortgage Services Corporation. Fund American Enterprises, Inc. shares
with FAEH and its subsidiary Source One Mortgage Services voting and
dispositive power with respect to 1,501,465 of such shares. FAEH and its
subsidiary FFOG, Inc. share voting and dispositive power with respect to
3,708,735 of such shares.

(2) Based on a Schedule 13G dated February 14, 1994 filed with the Commission by
FMR Corp., which has sole voting power with respect to 41,584 of such shares
and sole dispositive power with respect to all of such shares.

(3) Based on a Schedule 13G dated February 9, 1994 filed with the Commission by
Metropolitan Life Insurance Company ("Metropolitan"), which has sole voting
power with respect to 1,898,650 of such shares and sole dispositive power
with respect to all of such shares. Metropolitan has reported that its
subsidiary, State Street Research and Management Company, Inc. ("State
Street") is the beneficial owner of 2,026,550 shares (with respect to which
State Street has also filed a Schedule 13G with the Commission) of the total
shares identified in the table above.

2
<PAGE> 5

The following table sets forth the amount and percentage of Capital Stock
(including shares held for the account of Executive Officers in The LL&E Savings
Plan and The LL&E Dividend Reinvestment Plan) beneficially owned as of February
15, 1994 (March 1, 1994 in the case of Mr. Orce) by each nominee for election as
a Director of the Company, by each of the individuals named in the Summary
Compensation Table and by all Executive Officers and Directors of the Company as
a group. Beneficial ownership has been determined in accordance with Rule 13d-3
under the Securities Exchange Act of 1934, as amended, and does not necessarily
bear on the economic incidents of ownership or the right to transfer such
shares.

<TABLE>
<CAPTION>
AMOUNT AND NATURE
OF BENEFICIAL
OWNERSHIP OF
SHARES OF CAPITAL PERCENT
NAME OF INDIVIDUAL STOCK(1) OF CLASS
--------------------------------------------- ----------------- -----------------
<S> <C> <C>
Leland C. Adams.............................. 7,250 *
Richard A. Bachmann.......................... 35,886 *
John F. Greene............................... 119,620 *
Eamon M. Kelly............................... 6,777 *
Kenneth W. Orce.............................. 2,000 *
Victor A. Rice............................... 1,000 *
Orin R. Smith................................ 6,150 *
H. Leighton Steward.......................... 232,339 *
Arthur R. Taylor............................. 7,750 *
W.R. Timken, Jr. ............................ 127,123(2) *
Carlisle A.H. Trost.......................... 4,014 *
Joel M. Wilkinson............................ 41,372 *
John A. Williams............................. 39,261 *
E.L. Williamson.............................. 127,451 *
All Directors and Executive Officers as a
group (19 persons), including those named
above...................................... 981,424 3.0%
</TABLE>

- ---------------

* Less than 1%

(1) Includes the following shares which Directors and Executive Officers had the
right to acquire upon the exercise of options within sixty (60) days from
February 15, 1994; Leland C. Adams -- 6,250 shares, Richard A.
Bachmann -- 17,088 shares, John F. Greene -- 78,221 shares, Eamon M.
Kelly -- 6,250 shares, Orin R. Smith -- 3,750 shares, H. Leighton
Steward -- 169,237 shares, Arthur R. Taylor -- 6,250 shares, W.R. Timken,
Jr. -- 6,250 shares, Carlisle A.H. Trost -- 3,750 shares, Joel M.
Wilkinson -- 31,500 shares, John A. Williams -- 26,600 shares, E.L.
Williamson -- 94,325 shares, all Directors and Executive Officers as a
group -- 585,130 shares.

(2) Includes 39,873 shares as to which Mr. Timken has sole voting and investment
power; 54,000 shares owned by various trusts of which Mr. Timken is a
co-trustee or co-advisor; and 1,000 shares owned by a charitable trust of
which Mr. Timken is a member. Mr. Timken disclaims beneficial interest in
5,000 of such shares owned by members of his family living in his own home
and 21,000 of such shares owned by a trust of which his wife is a
co-trustee.

3
<PAGE> 6

I. ELECTION OF DIRECTORS

Twelve Directors are to be elected, each Director to hold office until the
next Annual Meeting of Stockholders and until his successor is elected and
qualifies. The persons named as proxies on the enclosed Proxy have been
designated by the Board of Directors and intend to vote, unless otherwise
directed, for the nominees listed below. All of such nominees, other than
Kenneth W. Orce, are now serving as Directors and were elected at the 1993
Annual Meeting. A majority of shares present at the meeting cast in favor of a
nominee is required for the election of each of the nominees listed below.

<TABLE>
<CAPTION>
SERVED POSITION, PRINCIPAL
AS OCCUPATION, BUSINESS
NAME OF DIRECTOR EXPERIENCE AND OTHER
NOMINEE AGE SINCE DIRECTORSHIPS HELD
- ------------------------------ --- ---- ------------------------------------------
<S> <C> <C> <C>
Leland C. Adams(1)............ 69 1988 Former Executive Vice President
(1983-1987) and Director (1976-1987) of
Amoco Corporation; Director of Global
Marine Inc. from 1987 to 1988.
Richard A. Bachmann........... 49 1989 Executive Vice President, Finance and
Administration, of the Company since May
1985; Chief Financial Officer of the
Company since 1981.
John F. Greene................ 53 1989 Executive Vice President, Exploration and
Production, of the Company since May 1985.
Eamon M. Kelly(2)(3).......... 57 1986 President of Tulane University; Director
Emeritus of Hibernia Corp.; Director of
Gabelli Enterprises; Director of Zapata
Corporation from 1984 to 1986.
Kenneth W. Orce............... 50 -- Partner of the law firm of Cahill Gordon &
Reindel, New York, since 1976.
Victor A. Rice(2)(5).......... 53 1993 Chairman of the Board of Directors and
Chief Executive Officer of Varity
Corporation since 1980 and a Director of
Varity Corporation since 1978; Director of
Comptek Research, Inc. and Halton
Reinsurance Co. Ltd.
Orin R. Smith(1)(4)(5)........ 58 1991 President and Chief Executive Officer of
Engelhard Corporation since May 1984 and
Director of Engelhard Corporation or its
predecessor company (Engelhard Minerals &
Chemicals Corporation) since 1979;
Director of Vulcan Materials Company, The
Summit Bancorporation and New Jersey
Manufacturers Insurance Company.
H. Leighton Steward(3)(4)(5).. 59 1985 Chairman of the Board and Chief Executive
Officer of the Company since January 1,
1989; President of the Company since
January 1985; Chief Operating Officer of
the Company from January 1985 through
December 1988; Director of First Commerce
Corporation and the First National Bank of
Commerce.
</TABLE>

(Table continued on following page)

4
<PAGE> 7

- ---------------

(1) Compensation Committee member. Mr. Taylor is Chairman of the Committee.

(2) Audit Committee member. Mr. Timken is Chairman of the Committee.

(3) Executive Committee member. Mr. Steward is Chairman of the Committee.

(4) Nominating Committee member. Mr. Smith is Chairman of the Committee.

(5) Finance Committee member. Mr. Taylor is Chairman of the Committee.

DIRECTORS' COMPENSATION, COMMITTEES AND MEETING ATTENDANCE

During the last fiscal year, the Board of Directors held seven regular
meetings. Directors who are not Officers of the Company receive an annual
retainer of $30,000 for their services as Directors, and each such Director
receives $1,000 for each Board meeting attended. Each non-employee member of the
Audit Committee, the Nominating Committee, the Compensation Committee, the
Finance Committee and the Executive Committee receives $1,000 for attendance at
each Committee meeting. In addition, the Chairman of each of the Audit
Committee, the Compensation Committee and the Finance Committee receives an
annual retainer of $5,000. Each non-employee Director may elect to defer all or
a portion of the compensation otherwise payable to him. Amounts deferred in 1993
accrued interest at a fixed rate of 18% per annum pursuant to an arrangement
similar to that in effect in 1993 for certain Company employees.

Any Director who at the time of retirement has either completed four years
of service as a non-employee Director and is at least seventy years of age or
has completed ten or more years of service as a non-employee Director is
eligible for an annual retirement benefit under the Company's Directors'
Retirement Plan (the "Directors' Plan") equal to the annual Board retainer fee
(excluding meeting and committee fees) in effect at the time of retirement or as
it may be increased from time to time, commencing on the later of the Director's
retirement or his attaining age seventy. Payments continue until the Director's
death or, in the case of a Director retiring before reaching age seventy, until
payments have been made for a period equal to the period

5
<PAGE> 8

of the Director's service as a non-employee Director. In the event of a "Change
of Control" of the Company (as defined in the Directors' Plan), Directors will
be credited with a period of service equal to the greater of the period of such
Director's service as a non-employee Director or ten years. Directors eligible
to receive benefits under The LL&E Pension Plan after the effective date of the
Directors' Plan (March 1, 1987) are not eligible to participate in the
Directors' Plan.

The Louisiana Land and Exploration Company 1990 Stock Option Plan for
Non-Employee Directors (the "1990 Plan"), which was adopted by vote of the
stockholders at the 1990 Annual Meeting, provides for an annual grant of an
option to purchase 2,500 shares of Capital Stock to each member of the Board of
Directors of the Company who is not an employee of the Company or of any
affiliate of the Company. Options granted under the 1990 Plan generally are
exercisable in two equal annual installments commencing on the first anniversary
of the date of grant, and may be exercised until their expiration ten years from
the date of grant (unless such options expire at an earlier date following the
non-employee Director's termination of service). The option price per share of
Capital Stock payable upon the exercise of an option under the 1990 Plan is the
Fair Market Value (as defined) of Capital Stock on the date the option is
granted. If a non-employee Director participating in the 1990 Plan ceases to be
a Director on account of retirement (and such participant is otherwise eligible
for benefits under the Directors' Plan), death or disability, or if a "Change of
Control" of the Company (as defined in the 1990 Plan) occurs, all of such
participant's options outstanding for six months or more become immediately and
fully exercisable.

During 1992, The Louisiana Land and Exploration Company Foundation pledged
to contribute $50,000 per year for six years for the endowment of the Evelyn and
John G. Phillips Distinguished Chair in Mathematics at Tulane University. Mr.
Phillips, former Chairman of the Board and Chief Executive Officer of the
Company, retired at the 1993 Annual Meeting following many years of
distinguished service to the Company. In addition, the Company regularly makes
charitable contributions to a number of universities, including Tulane
University. Company Director Eamon M. Kelly is President of Tulane University.

The Board has five standing committees: the Executive Committee; the
Compensation Committee; the Audit Committee; the Finance Committee; and the
Nominating Committee.

The Compensation Committee administers The Louisiana Land and Exploration
Company 1988 Long-Term Stock Incentive Plan, determines the compensation
policies for Company Officers, and recommends to the entire Board of Directors
the salaries of the three most senior Officers of the Company. During 1993, the
Compensation Committee held four meetings.

The principal functions of the Audit Committee are: to receive reports
prepared by the Company's internal auditors; to recommend the selection,
retention or termination of independent auditors; to review arrangements and
proposals for the overall scope of the annual audit with management and the
independent auditors; and to discuss matters of concern to the Audit Committee
with the independent auditors and management relating to the annual financial
statements and results of the audit. During 1993, the Company's Audit Committee
held four meetings.

The principal functions of the Finance Committee are: to review all major
financings of the Company (including the issuance of securities); to recommend
the size, timing, pricing and terms of any such financing; to review the
Company's financial policies, capitalization and forecasted capitalization; to
evaluate investment programs; to review the Company's continuing financial
arrangements; and such additional duties as may from time to time be assigned to
the Finance Committee by the Board of Directors in respect of specific financing
programs undertaken by the Company. During 1993, the Company's Finance Committee
held three meetings.

The Nominating Committee establishes criteria for the selection of
Directors, seeks out and interviews Director candidates and recommends to the
Board those Director candidates who shall stand for election at the Annual
Meeting of Stockholders and who shall fill interim vacancies. During 1993, the
Company's Nominating Committee held two meetings.

During 1993, each of the incumbent Directors attended at least 75% of the
aggregate of the meetings of the Board of Directors and committees on which they
served.

6
<PAGE> 9

COMPENSATION COMMITTEE INTERLOCKS AND INSIDER PARTICIPATION.

Mr. John G. Phillips, a former member of the Compensation Committee, who
retired at the 1993 Annual Meeting, was Chairman of the Board and Chief
Executive Officer of the Company from May 2, 1974 to December 31, 1984.

COMPLIANCE WITH SECTION 16(A) OF THE SECURITIES EXCHANGE ACT OF 1934.

Section 16(a) of the Securities Exchange Act of 1934 requires the Company's
Executive Officers and Directors and persons who own more than 10% of a
registered class of the Company's equity securities to file initial reports of
ownership and changes in ownership with the Securities and Exchange Commission
("SEC") and the New York Stock Exchange. Such Officers, Directors and
stockholders are required by SEC regulations to furnish the Company with copies
of all Section 16(a) forms they file. Based solely on a review of the copies of
such forms furnished to the Company and written representations from the
Company's Executive Officers and Directors, all persons subject to the reporting
requirements of Section 16(a) filed the required reports on a timely basis, with
the exception of Mr. John A. Williams and Mr. W.R. Timken, Jr. Mr. Williams, in
timely reporting the April 14, 1993 exercise of options to purchase 9,050 shares
of Company stock, inadvertently did not report the subsequent sale on the same
date of the stock received through the exercise of such options. Mr. Timken
inadvertently did not report the sale of 10,000 shares of stock by certain
trusts for which he is an advisor to the trustee. Amended Forms 4 properly
reporting these transactions were filed by Mr. Williams on December 10, 1993 and
by Mr. Timken on August 4, 1993.

7
<PAGE> 10

EXECUTIVE COMPENSATION

SUMMARY OF CASH AND CERTAIN OTHER COMPENSATION

The following table sets forth the compensation paid by the Company for
services rendered during each of the last three fiscal years to or for the
accounts of the Chief Executive Officer and the other four most highly
compensated Executive Officers.

SUMMARY COMPENSATION TABLE

<TABLE>
<CAPTION>
LONG-TERM COMPENSATION
----------------------------------
PAYOUTS
ANNUAL COMPENSATION -------------------
---------------------------------- AWARDS NUMBER
OTHER -------- OF ALL
ANNUAL RESTRICTED SECURITIES OTHER
COMPEN- STOCK UNDERLYING LTIP COMPEN-
SATION AWARD(S) OPTIONS/ PAYOUTS SATION
NAME AND PRINCIPAL POSITION YEAR SALARY($) BONUS($)(1) ($)(2) ($)(1)(3)(4) SARS(3) ($)(3) ($)(5)
- -------------------------------- ---- -------- -------- -------- -------- ------ -------- --------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
H. Leighton Steward 1993 $543,846 $140,000 $151,141 $120,563 13,500 $152,677 $239,768
Chairman of the Board, 1992 $510,000 $ 13,275 37,500 $126,044 $160,733
President and Chief Executive 1991 $491,923 $ 85,000 $173,525 12,600 $165,101
Officer
Richard A. Bachmann 1993 $340,385 $ 75,000 $114,758 $120,563 8,600 $100,330 $ 61,990
Executive Vice President, 1992 $325,000 $ 8,825 22,500 $ 85,006 $ 33,011
Finance and Administration 1991 $317,769 $ 54,200 $109,636 8,300 $111,555
Chief Financial Officer,
and Director
John F. Greene 1993 $340,385 $ 75,000 $108,984 $120,563 8,600 $100,330 $130,500
Executive Vice President, 1992 $325,000 $ 8,825 22,500 $ 85,006 $104,644
Exploration and Production, 1991 $317,769 8,300 $111,555
and Director
John A. Williams 1993 $213,615 $ 25,000 $373,574 $ 89,781 3,700 $ 43,622 $ 48,234
Vice President 1992 $205,000 $ 20,000 $225,755 11,200 $ 35,175 $ 36,437
1991 $199,577 3,700 $ 44,622
Joel M. Wilkinson 1993 $199,385 $ 25,000 $ 10,025 3,400 $ 34,898 $ 23,010
Vice President 1992 $192,000 $ 20,000 $ 3,325 9,000 $ 29,313 $ 19,642
1991 $187,662 3,000 $ 44,622
</TABLE>

- ---------------

(1) Each of the Executive Officers named above received a bonus in 1994 for 1993
performance. Messrs. Steward and Bachmann received a special cash award and
grant of 4,400 and 2,780 shares of Restricted Stock, respectively, on
September 24, 1991 under The 1988 Long-Term Stock Incentive Plan. The shares
vested on September 23, 1992.

(2) "Other Annual Compensation" includes: (i) the reimbursement to Mr. Williams
in 1992 of $72,297 for costs incurred in connection with his transfer to
London under The LL&E Relocation Program and in 1993 and 1992, payment of
$333,308 and $148,996, respectively, under The LL&E Expatriate Program; (ii)
tax assistance payments in connection with the grants of Restricted Stock
for 1993 performance made to Messrs. Steward, Bachmann, Greene and Williams
in the amounts of $92,833, $92,833, $92,833 and $35,441, respectively; and
(iii) cash dividends paid on Performance Shares, the cost of group term life
insurance in excess of $50,000 and certain usage of the Company aircraft.

(3) Under The 1988 Long-Term Stock Incentive Plan, restrictions lapse in the
event of a "Change of Control" (as defined).

(4) Mr. Williams has an aggregated total of 2,000 shares in unvested Restricted
Stock holdings with a December 31, 1993 value of $80,250. Messrs. Steward,
Bachmann and Greene each received grants of 3,000 shares of unvested
Restricted Stock in February 1994 for their efforts and performance in 1993.
The Restricted Stock has a three year vesting schedule in which one-third of
the shares will vest each year beginning one year from the date of grant.
Dividends are payable on Restricted Stock if and to the extent dividends are
paid on the Company's Capital Stock generally.

(5) "All Other Compensation" includes the following: (i) Company contributions
and allocations in 1993 to its defined contribution plans for the benefit of
Messrs. Steward, Bachmann, Greene, Williams and Wilkinson in the amounts of
$70,340, $36,932, $36,932, $22,472 and $20,748, respectively and (ii)
interest accrued during 1993 in excess of 120% of the applicable federal
interest rate with respect to 1986 through 1993 salary and bonus deferrals
as follows: Mr. Steward $169,428, Mr. Bachmann $25,058, Mr. Greene $93,568,
Mr. Williams $25,761 and Mr. Wilkinson $2,262.

8
<PAGE> 11

STOCK OPTION GRANTS AND EXERCISES

The following table sets forth information concerning individual grants of
stock options under The 1988 Long-Term Stock Incentive Plan made during the last
completed fiscal year to each of the named Executive Officers. The Company did
not grant any stock appreciation rights ("SARs") in 1993.

OPTION/SAR GRANTS IN LAST FISCAL YEAR

<TABLE>
<CAPTION>
INDIVIDUAL GRANTS(1)
------------------------------------------------------
NUMBER % OF TOTAL
OF OPTIONS/SARS
SECURITIES GRANTED TO EXERCISE
UNDERLYING EMPLOYEES OR BASE EXPIRA- GRANT DATE
OPTIONS/SARS IN FISCAL PRICE TION PRESENT
NAME GRANTED YEAR ($/SH) DATE VALUE ($)(2)
----------------------- ------------ ------------ -------- ------- ------------
<S> <C> <C> <C> <C> <C>
H. Leighton Steward.... 13,500 5.3% $ 44.875 5/12/03 $205,659
Richard A. Bachmann.... 8,600 3.4% $ 44.875 5/12/03 $131,012
John F. Greene......... 8,600 3.4% $ 44.875 5/12/03 $131,012
John A. Williams....... 3,700 1.5% $ 44.875 5/12/03 $ 56,366
Joel M. Wilkinson...... 3,400 1.3% $ 44.875 5/12/03 $ 51,796
</TABLE>

- ---------------

(1) One-half of the options vest on the first anniversary of the date of grant
and the remainder vest on the second anniversary of the date of grant.

(2) Based on the Black-Scholes option pricing model, using a five-year weighted
average dividend yield (2.66%), volatility based on stock price data over
the five years preceding the grant (0.2560) in order to estimate the values
that might occur over the course of the option term. The yield and
volatility were also reviewed in light of known changes in dividend policy
or corporate restructurings that could have an effect in the future. For the
risk-free rate (6.2%), the Company used the yield on U.S. Treasury Strips
with a time to maturity that approximates the term of the option (10 years).
The result is a Black-Scholes option value of $15.23 per share. The Company
does not believe that the values estimated by the Black-Scholes model, or
any other model, will necessarily be indicative of the values to be realized
by an executive.

The following table sets forth information concerning each exercise of
stock options (or tandem SARs) and freestanding SARs during the last completed
fiscal year by each of the named Executive Officers and the fiscal year-end
value of unexercised options and SARs.

AGGREGATED OPTION/SAR EXERCISES IN LAST FISCAL YEAR
AND FY-END OPTION/SAR VALUES

<TABLE>
<CAPTION>
TOTAL NO. OF SECURITIES VALUE OF UNEXERCISED
UNDERLYING UNEXERCISED IN-THE-MONEY OPTIONS/
SHARES OPTIONS HELD AT FY-END SARS AT FY-END($)
ACQUIRED VALUE ----------------------------- -----------------------------
NAME ON EXERCISE REALIZED EXERCISABLE UNEXERCISABLE EXERCISABLE UNEXERCISABLE
- -------------------------------- ----------- -------- ----------- ------------- ----------- -------------
<S> <C> <C> <C> <C> <C> <C>
H. Leighton Steward............. 24,900 $256,100 150,487 32,250 $1,092,159 $ 194,531
Richard A. Bachmann............. 44,185 $293,346 9,150 16,537 $ 4,941 $ 82,346
John F. Greene.................. 12,300 $133,763 66,971 19,850 $ 453,593 $ 116,719
John A. Williams................ 9,050 $151,638 21,000 9,300 $ 134,706 $ 58,100
Joel M. Wilkinson............... 0 $ 0 27,000 7,900 $ 189,438 $ 46,688
</TABLE>

9
<PAGE> 12

LONG-TERM STOCK INCENTIVE PLAN AWARDS

The following table sets forth information regarding each award of
Performance Shares made to a named Executive Officer in the last completed
fiscal year under The 1988 Long-Term Stock Incentive Plan.

LONG-TERM INCENTIVE PLAN -- AWARDS IN LAST FISCAL YEAR

<TABLE>
<CAPTION>
PERFORMANCE ESTIMATED FUTURE PAYOUTS
PERIOD UNDER NON-STOCK PRICE-BASED PLANS
UNTIL ----------------------------------
NUMBER MATURATION THRESHOLD TARGET MAXIMUM
OF OR (NO. OF (NO. OF (NO. OF
NAME SHARES(1) PAYOUT(2) SHARES) SHARES) SHARES)
---------------------------------- ----- ------- --------- --------- -------
<S> <C> <C> <C> <C> <C>
H. Leighton Steward............... 4,500 3 years 750 4,500 6,750
Richard A. Bachmann............... 2,900 3 years 483 2,900 4,350
John F. Greene.................... 2,900 3 years 483 2,900 4,350
John A. Williams.................. 1,300 3 years 216 1,300 1,950
Joel M. Wilkinson................. 1,100 3 years 183 1,100 1,650
</TABLE>

- ---------------

(1) Performance Shares awarded under The 1988 Long-Term Stock Incentive Plan.

(2) Payout of awards are conditioned upon achieving one or more specified levels
of three criteria which are weighted equally: the three year average of the
Company's working capital return on total capital employed; the three year
average of the increase in the value of proved reserves; and the three year
average of total shareholder return relative to pre-determined peer
companies. If none of the specified levels are met, no awards are payable.

PENSION PLANS

The following table shows the estimated benefits payable to a covered
participant at normal retirement age under the Company's qualified defined
benefit plan, as well as non-qualified supplemental pension plans that provide
benefits that would otherwise be denied participants by reason of certain
Internal Revenue Code limitations on qualified plan benefits, based on
remuneration that is covered under the plans and years of service with the
Company and its subsidiaries:

<TABLE>
<CAPTION>
PENSION PLAN TABLE
YEARS OF SERVICE
AVERAGE --------------------------------------------------------------------
COMPENSATION 15 20 25 30 35 40
- ------------ -------- -------- -------- -------- -------- --------
<S> <C> <C> <C> <C> <C> <C>
$200,000.................. $ 60,000 $ 80,000 $100,000 $120,000 $140,000 $160,000
$300,000.................. $ 90,000 $120,000 $150,000 $180,000 $210,000 $240,000
$400,000.................. $120,000 $160,000 $200,000 $240,000 $280,000 $320,000
$450,000.................. $135,000 $180,000 $225,000 $270,000 $315,000 $360,000
$500,000.................. $150,000 $200,000 $250,000 $300,000 $350,000 $400,000
$550,000.................. $165,000 $220,000 $275,000 $330,000 $385,000 $440,000
$600,000.................. $180,000 $240,000 $300,000 $360,000 $420,000 $480,000
$650,000.................. $195,000 $260,000 $325,000 $390,000 $455,000 $520,000
$700,000.................. $210,000 $280,000 $350,000 $420,000 $490,000 $560,000
</TABLE>

A participant's remuneration covered by the Company's pension plans is his
or her average base salary (as reported in the Summary Compensation Table) less
elected deferrals for the three plan years during the last ten years of the
participant's career for which such average is the highest. Pension plan
benefits in the Table are determined on the basis of a ten-year certain and life
annuity. The benefits shown are displayed before the application of the pension
plans' offset against social security. As of January 1, 1994, Messrs. Steward,
Bachmann, Greene, Williams and Wilkinson have accrued 11, 12, 8, 7, and 6 years,
respectively, under the pension plans. The Company has also agreed to supplement
pension payments for Mr. Steward as if he had been in the employ of the Company
since the date he joined a former employer (1962). The benefits will be reduced
by the amount of any similar benefits paid Mr. Steward by his former employer.
Covered compensation (base salary less elected deferrals) for Messrs. Steward,
Bachmann, Greene, Williams

10
<PAGE> 13

and Wilkinson for the year ended December 31, 1993 was $543,846, $314,385,
$314,385, $213,615 and $199,385, respectively.

TERMINATION OF EMPLOYMENT ARRANGEMENTS AND CERTAIN TRANSACTIONS

Pursuant to the Company's Special Termination Benefit Plan (the
"Termination Plan"), the Company provides severance benefits in the event of
"involuntary termination" of eligible employees within 18 months following a
"Change of Control" of the Company (as defined below), in an amount equal to six
months' base pay (as of the date of the "Change of Control") or, in the case of
employees with six years or more of service to the Company, an amount equal to
one month's base pay for each year of service not to exceed twelve months' base
pay. Messrs. Williams and Wilkinson are eligible, and Messrs. Steward, Bachmann
and Greene are not eligible, for severance benefits under the Termination Plan.

A "Change in Control" is deemed to have occurred for purposes of the
Termination Plan if (i) thirty percent (30%) or more of the Company's
outstanding securities entitled to vote in elections of directors are
beneficially owned, directly or indirectly, by any person, entity or group; (ii)
individuals currently constituting the Board of Directors (or the successors of
such individuals nominated by a Board of Directors of the Company on which such
individuals or such successors constituted a majority) cease to constitute a
majority of such Board; or (iii) a majority of the Board of Directors determines
that an event effecting an actual change in control of the Company has occurred
or is likely to occur; and, in addition to an event described in (i), (ii) or
(iii) occurring, a majority of the Board of Directors of the Company in office
prior to such event occurring determines at any time not later than six (6)
months following such event that it would be in the best interest of the Company
for the Termination Plan to become effective.

The Company has entered into agreements with Messrs. Steward, Bachmann and
Greene which provide that in the event of an "involuntary termination" (other
than for "cause") following a "Change in Control" of the Company (as such terms
are defined in such agreements), each such Executive Officer shall be entitled
to receive from the Company an amount in cash equal to twice the sum of such
Executive Officer's highest annual salary and bonus award during the preceding
three years.

On February 17, 1993, the Company acquired 40,247 shares of Capital Stock
from Richard A. Bachmann for $38 per share (the average of the high and low
trading price on such date). Mr. Bachmann is Executive Vice President, Finance
and Administration, and a Director of the Company.

Kenneth W. Orce, a nominee for election as a Director of the Company, is a
partner of the law firm Cahill Gordon & Reindel, which firm currently provides,
and in 1993 provided, legal services to the Company.

REPORT ON EXECUTIVE COMPENSATION

Compensation Committee

The Compensation Committee (the "Committee") is responsible for determining
the compensation of Company Officers other than the salaries of the three most
senior Officers of the Company, which are determined by the Board of Directors
based upon the Committee's recommendation. The Committee also administers The
Louisiana Land and Exploration Company 1988 Long-Term Stock Incentive Plan.

The Committee is composed of four non-employee Directors: Messrs. Adams,
Smith, Taylor and Trost. Decisions and recommendations by the Committee are made
on the basis of an assessment of corporate performance and a review of
supporting data, including historical compensation data of other companies
within the industry. The Committee regularly utilizes the services of
independent consultants specializing in executive compensation. Although actions
with respect to various programs are taken at different times, consideration of
each is made in the context of the overall compensation package provided by the
Company.

As of the time of issuing this report the Committee was still evaluating
its compensation policies with respect to qualifying compensation paid to its
executive officers for deductibility under Section 162(m) of the Internal
Revenue Code. The Committee believes that compensation to be paid in 1994 will
not exceed one million dollars in non-excluded compensation to any of the named
executives.

11
<PAGE> 14

Compensation Philosophy

The Company's executive compensation program is designed to provide
competitive levels of pay and assist the Company in attracting and retaining
qualified executives. The Committee is committed to the objectives of linking
executive compensation to corporate performance and providing incentives which
align the interests of Company executives with the interests of its
stockholders. This philosophy underlies executive compensation policies designed
to integrate rewards with the attainment of annual and long-term performance
goals, reward significant corporate performance and recognize individual
initiatives and achievements.

The Committee's objective is to set executive compensation at levels
competitive with others in the Company's industry. However, it is performance
which most significantly influences an individual executive's compensation
level. As a result, actual compensation levels in any particular year may be
above or below those of the Company's competitors, depending upon the Company's
performance. The executive compensation program is comprised of salary, annual
cash incentives and long-term, stock-based incentives. The following is a
discussion of each of the elements of the executive compensation program along
with a description of the decisions and actions taken by the Committee with
regard to 1993 compensation:

Base Salary

Salary ranges for each executive position are established by the Company
based on appropriate external comparisons, internal responsibilities and
relationships to other corporate positions. External comparisons are based upon
survey data compiled and analyzed by an executive compensation consultant firm
and include more than twenty (20) independent oil and gas companies. Most of the
companies identified in the Company's performance graph (the "Performance Peer
Group") are participants in the survey. The analysis and subsequent
recommendations are based on this survey rather than the Performance Peer Group
in order to be more statistically sound and representative of the industry. An
internal analysis of this data is conducted and the executive positions' salary
ranges (minimum, midpoint, maximum) are recommended to the Committee based upon
a third quartile target of the appropriate survey data. The midpoint of the
salary range represents the "targeted" salary of the survey data. The salary
ranges developed are part of an executive salary program which is reviewed with
the Committee by the Chief Executive Officer. The program recommendations are
based on financial and operational results, individual contributions to
corporate performance and the historical compensation data of other companies
within the industry. Individual executives' salaries might be set above or below
the midpoint (target) of the salary range for their positions depending upon the
assessment of their contributions to corporate performance. The Committee meets
without the Chief Executive Officer to evaluate his performance and develop
recommendations as to adjustments to his salary. The Committee's recommendations
with respect to the salaries of the Company's top three Executive Officers are
presented to the Board of Directors.

Mr. Steward and the other executives received salary adjustments in May
1993. The prior executive salary adjustment was in May 1991. The primary basis
for granting the salary adjustments to the executives, including Mr. Steward,
was the highly effective leadership demonstrated in developing and managing the
Company through a difficult, comprehensive restructuring and reorganization
effort which began in 1992. Their efforts resulted in the sale of low return
domestic properties; the redeployment of the sale proceeds to high potential
international areas; adding new reserves in excess of amounts produced during
the year; refinancing certain Company indebtedness on favorable terms; improving
the Company's stock performance relative to the Company's peer group; and
improving the Company's cost structure with the implementation of additional
cost cutting measures. Mr. Steward's salary prior to May 1993 was determined to
be more than seven percent below the targeted level based on an analysis of the
competitive survey data. His salary also fell below the average and the median
of the salaries of CEO's of the Performance Peer Group companies, which were
also presented to the Committee. Based upon the market data and the previously
discussed corporate accomplishments and activities, Mr. Steward's salary was
adjusted the equivalent of 5.4% annually.

12
<PAGE> 15

Annual Incentive

The annual incentive plan is a cash bonus program. It is designed to reward
significant corporate accomplishments and individual initiatives which
contributed to the attainment of targeted goals relating to reserve replacement,
rates of return, return on working capital employed, increase in earnings per
share, stockholder return, and maintenance of the Company's credit rating. If
the Committee determines that corporate results are such that a bonus program is
warranted, then each executive's accomplishments are assessed as to their impact
on corporate results. The threshold for any payment is "significant
achievement"; specifically, contributions must be above and beyond normal
expectations. The actual bonus amount received by an executive is determined as
a percent of salary within a pre-established range assigned to the position
which is based on a target of the median of competitive market data. The same
survey used for base salary data is the source for this determination. The Chief
Executive Officer meets with the Committee to review corporate results, the
individual executives' contributions and his recommendations as to annual
incentive payments. The Committee evaluates the Chief Executive Officer's
contributions.

Fiscal 1993 was a year in which Mr. Steward and other executives exhibited
highly effective leadership and management skills in positioning the Company for
the future. Two major acquisitions were effected: (1) NERCO Oil & Gas, Inc.
("NERCO") and (2) T-Block reserves in the North Sea. The NERCO acquisition
augmented the Company's position in the Gulf of Mexico and provided staff
expertise to fully exploit opportunities in that area. The addition of the
T-Block reserves strengthened the Company's position in an area where it has
already had substantial success and resulted in a significant improvement in the
Company's cost structure. Proved reserves added through these acquisitions and
other investments were equal to 279% of amounts produced during the year, a very
significant accomplishment for an oil and gas company. In addition, the
Company's earnings per share increased substantially in 1993. In consideration
of these accomplishments it was determined in February 1994 that a bonus program
for 1993 performance be approved.

Long-Term Incentives

The 1988 Long-Term Stock Incentive Plan (the "Plan") was approved by
stockholders in 1988 for the purpose of "promoting the interests of the Company
and its stockholders by (i) attracting and retaining executives and other key
employees of outstanding ability; (ii) strengthening the Company's capability to
develop, maintain and direct a competent management team; (iii) motivating
executives and other key employees, by means of performance-related incentives,
to achieve longer-range performance goals; (iv) providing incentive compensation
opportunities which are competitive with those of other major corporations; and
(v) enabling such employees to participate in the long-term growth and financial
success of the Company."

Although the Plan authorizes the use of a variety of stock related forms of
compensation, the Company's practice is to grant non-qualified stock options and
Performance Shares. Restricted Stock has been utilized to recognize exceptional
efforts. Previous awards were considered when determining whether or not to
grant additional options, Performance Shares or Restricted Stock in 1993. The
granting of stock options is normally considered annually except when special
events or circumstances warrant otherwise. The options are granted to employees
based upon their potential impact on corporate results and on their performance.
Options are granted at market value and vest over a two-year period. The actual
number of options granted is calculated as a percentage of salary divided by the
current market value of the stock. The percentage applied to the executive's
salary is reviewed periodically. Performance Shares are granted in conjunction
with option grants to Executive Officers of the Company. The grant level of the
options and Performance Shares is based upon an assessment of the prior year's
performance and such grants are made at a ratio of three (3) options for each
Performance Share. The percentage payout of the Performance Shares is based on
results of a three-year cycle and a minimum threshold must be met before any
Performance Shares are earned. Target awards for each of the executives are
established at the beginning of each performance cycle and payout is based upon
the following performance criteria:

13
<PAGE> 16

1. One-third based upon the Company's 3-year average working capital
return on total capital employed.

2. One-third based upon the Company's 3-year average increase in value
of proved reserves.

3. One-third based upon the Company's 3-year average total stockholder
return (stock appreciation plus dividend yield) relative to the Peer
Performance Group reviewed and approved annually by the Committee.

The actual percentage payout can range from 0% to 150% depending upon the level
of results obtained for each of the specified criteria.

In May 1993, stock options were granted to executive officers and key
employees of the Company based on 1992 accomplishments. Performance Shares were
granted to Mr. Steward and the other executives in 1993 in relationship to stock
options granted as contemplated by the Plan's design. The ultimate number of
shares earned, ranging from 0% to 150%, will not be determined until the end of
the three-year cycle which began in 1993. Through these Performance Shares Mr.
Steward and other executives will share the benefits which accrue to all LL&E
shareholders if these efforts result in long-term success.

As discussed above, the successful acquisition efforts of the Company were
considered to be extremely important accomplishments. In order to recognize the
special efforts relating to the acquisitions, a Restricted Stock grant was
approved. Mr. Steward and three of the other named executives received awards,
as did a small number of key staff members. The restrictions are scheduled to
lapse in equal amounts over a 3-year period.

Compensation Committee

<TABLE>
<S> <C>
Leland C. Adams Orin R. Smith
Arthur R. Taylor Carlisle A.H. Trost
</TABLE>

14
<PAGE> 17

PERFORMANCE GRAPHS

The following graphs compare the performance of the Company's Capital Stock
to the S&P 500 Index and to the LL&E Peer Group for the five year period ended
December 31, 1993. The LL&E Peer Group consists of companies who are engaged in
the same line of business as LL&E and were selected on the basis of
comparability of market capitalization. The 1993 LL&E Peer Group, which includes
the Company, Anadarko Petroleum Corporation, Apache Corporation, Burlington
Resources, Maxus Energy Corporation, Noble Affiliates, Inc., Oryx Energy Company
and Santa Fe Energy Resources, Inc., is the same as that used for performance
measurement in connection with executive compensation programs. Burlington was
added to such group in 1993 by the Compensation Committee for the purpose of
broadening the base of comparison to include another company which the Company
believes is, after Burlington's recent restructuring of certain business lines,
an industry peer. The graphs below include both the 1993 LL&E Peer Group (with
Burlington) and the 1992 LL&E Peer Group (without Burlington). During the five
year period of 1989 to 1993, LL&E's Capital Stock performed at the median of the
1993 and 1992 LL&E Peer Groups. The graphs assume a $100 investment in each of
the LL&E Capital Stock, the S&P 500 Index and the respective LL&E Peer Group on
December 31, 1988.

<TABLE>
<CAPTION>
Measurement Period LL&E Capital S&P 500 In- 1993 LL&E
(Fiscal Year Covered) Stock dex Peer Group
<S> <C> <C> <C>
1988 100.00 100.00 100.00
1989 141.99 131.69 157.61
1990 138.63 127.60 130.55
1991 106.15 166.47 110.78
1992 118.90 179.15 120.01
1993 142.61 197.21 136.82
</TABLE>

15
<PAGE> 18

<TABLE>
<CAPTION>
Measurement Period LL&E Capital S&P 500 In- 1992 LL&E
(Fiscal Year Covered) Stock dex Peer Group
<S> <C> <C> <C>
1988 100.00 100.00 100.00
1989 141.99 131.69 162.93
1990 138.63 127.60 138.10
1992 106.15 166.47 109.31
1992 118.90 179.15 113.38
1993 142.61 197.21 134.35
</TABLE>

OTHER MATTERS

No business other than the election of a Board of Directors of the Company
is expected to come before the meeting, but should any other matters requiring a
vote of stockholders arise, including any question as to an adjournment of the
meeting, the persons named on the enclosed Proxy will vote thereon according to
their best judgment in the interests of the Company. All shares represented by
valid Proxies, unless otherwise specified, will be voted in the election of
Directors for the nominees named above; provided, however, that in the event any
of such nominees should withdraw or otherwise become unavailable for reasons not
presently known, the persons named as Proxies will vote for the election of
other persons in their place.

SELECTION OF INDEPENDENT ACCOUNTANTS

The Board of Directors has appointed KPMG Peat Marwick as the firm of
independent accountants to audit the accounts of the Company and its
subsidiaries for the year ending December 31, 1994. This firm expects to have a
representative at the meeting who will have the opportunity to make a statement
and who will be available to answer questions.

16
<PAGE> 19

STOCKHOLDER PROPOSALS

The Company will not consider including a stockholder's proposal for action
at its 1995 Annual Meeting of Stockholders in the proxy material to be mailed to
its stockholders in connection with such meeting unless such proposal is
received at the principal office of the Company no later than November 28, 1994.

By order of the Board of Directors,

/s/ FREDERICK J. PLAEGER, II
FREDERICK J. PLAEGER, II
General Counsel and Corporate
Secretary

Dated: March 28, 1994

YOUR VOTE IS IMPORTANT. STOCKHOLDERS WHO DO NOT EXPECT TO BE PRESENT AT THE
ANNUAL MEETING AND WHO WISH TO HAVE THEIR STOCK VOTED ARE REQUESTED TO SIGN AND
DATE THE ENCLOSED PROXY AND RETURN IT IN THE ENCLOSED ENVELOPE. NO POSTAGE IS
REQUIRED IF MAILED IN THE UNITED STATES.

17
<PAGE> 20

_______________________________________________________________________________

P THE LOUISIANA LAND AND EXPLORATION COMPANY

R
THIS PROXY IS SOLICIATED BY THE BOARD OF DIRECTORS OF THE
O LOUISIANA LAND AND EXPLORATION COMPANY

X PROXY FOR THE ANNUAL MEETING OF STOCKHOLDERS AT 9 O'CLOCK A.M.,
CENTRAL DAYLIGHT TIME, MAY 12, 1994; PAN AMERICAN LIFE
Y AUDITORIUM, 11TH FLOOR, PAN AMERICAN LIFE CENTER,
601 POYDRAS STREET, NEW ORLEANS, LOUISIANA

The undersigned hereby appoints H. LEIGHTON STEWARD, RICHARD A.
BACHMANN and JOHN F. GREENE, and each of them, with power of substitution,
as Proxies of the undersigned to vote all shares of stock which the
undersigned is entitled in any capacity to vote at the above-stated Annual
Meeting and at all adjournments and postponements thereof in the election
of directors and, in their discretion, upon such other matters as may
properly be brought before the meeting. This proxy revokes all prior
proxies given by the undersigned.

ALL PROPERLY SIGNED PROXIES WILL BE VOTED AS DIRECTED. IF NO
DIRECTION IS MADE, THIS PROXY WILL BE VOTED FOR THE ELECTION OF THE
DIRECTOR NOMINEES DESIGNATED ON THE REVERSE SIDE.

Receipt of the Notice of Annual Meeting and Proxy Statement is hereby
acknowledged.

(continued and to be signed on the reverse side)
_______________________________________________________________________________

<PAGE> 21

_______________________________________________________________________________
/X/ Please mark your votes as in this example. 3126

_______________________________________________________________________________
THE DIRECTORS RECOMMEND A VOTE FOR ALL OF THE NOMINEES.
_______________________________________________________________________________

1. Election of Directors. FOR / / WITHHOLD / /

Leland C. Adams, Richard A. Bachmann, John F. Greene, Eamon M. Kelly,
Kenneth W. Orce, Victor A. Rice, Orin R. Smith, H. Leighton Steward, Arthur R.
Taylor, W. R. Timken, Jr., Carlisle A.H. Trost and E. L. Williamson.

(You may withhold a vote for any individual nominee by marking the "FOR" box
and writing that nominee's name on the line provided below)

- -------------------------------------------------------------------------------

Please sign, date and mail this proxy
card promptly using the enclosed envelope.
Joint owners should EACH sign. Please sign
EXACTLY as your name(s) appear(s) on this
card. When signing as attorney, trustee,
executor, administrator, guardian or
corporate officer, please give your FULL
title below.

------------------------------------------

------------------------------------------
SIGNATURE(S) DATE
_______________________________________________________________________________