UNOCAL CORPORATION
1996 Proxy Solicitation Material
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UNOCAL CORPORATION
1996 Suggested Telephone Procedures
Organize your material and key points you want to make. Be sure to speak
with:
1. Consistency
2. Efficiency
3. Confidence
Surveys show that the real message being conveyed by telephone is based:
1. 90% on your tone of voice
2. 10% on your words
A good technique is to start off with the person's name. Your attitude and
choice of words are important:
1. Set the tone of the conversation; do not be curt or abrasive.
2. Make sure the stockholder realizes you are there to provide
a service, and that you can serve as a source of additional information.
3. Use plain English.
Rules for overcoming objections:
1. Be quiet
2. Do not interrupt
3. Listen carefully
4. Write down pertinent information
5. Respond to specific concerns as appropriate.
ANSWER PROMPTLY. Try to answer on the first ring, if possible. Your
alertness gives a positive start to any conversation.
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IDENTIFY YOURSELF. Let the caller know to whom he or she is speaking.
It avoids misunderstanding and possible embarrassment.
TREAT EVERY CALL AS IMPORTANT. No stockholder request is ever "routine".
BE A GOOD LISTENER. Give the caller your undivided attention. Don't ask
the person to repeat, except when you want to verify a number or spelling.
USE COMMON COURTESY WORDS. "Please", "thank you", or "you're welcome" are
positive and powerful words that build a reputation for you and your company.
USE THE CALLER'S NAME. There's no sweeter music to a person than the sound
of his or her own name.
TIME FOR A GOOD ENDING. Always thank the person for calling and offer a
simple "good-bye".
BE HELPFUL. Offer what information you can. If you leave the line to
obtain information, explain what you intend to do. It is courteous to say,
"will you wait?" or, "shall I have someone call you back?".
NEVER LEAVE A CALLER HANGING. If a caller chooses to stay on the line, use
the "Hold" button. Be certain to give progress reports every 60 seconds or
so to assure the caller that you're working on the request.
BE TACTFUL. If the information the caller requests must be refused because
of company policy, give a straightforward but kind explanation.
THANK THE CALLER FOR WAITING. Show your appreciation for the caller's
patience. If you smile as you say "Thank you for waiting, Mr. Grey", your
voice will be more relaxed and your tone more pleasant.
TRANSFER A CALL ONLY WHEN NECESSARY. Be sure the party wants to be
transferred. If not, offer to have someone call back.
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UNOCAL CORPORATION
Instruction for Employees Who Will Call Stockholders
GUIDELINES:
1. My name is ___________________. I am an employee of Union Oil
Company of California, which is a subsidiary of Unocal Corporation.
2. Have you received your Unocal proxy card and proxy statement that
was mailed on April 22?
3. Do you have any questions about either one?
4. If you haven't completed and returned your proxy, please do so as
soon as possible. It is important that you exercise your rights as
a stockholder.
5. In case you have misplaced your proxy card, we will have another
one mailed to you today.
6. Do you plan to attend the Annual Stockholders Meeting on June 3?
If so, did you return the attendance card enclosed in your proxy
statement? If not, and you would like to attend, please give me
your address and telephone number.
7. Ask them to vote their proxy. Ask them if they would like you to
review the card with them. Please, remind them that all voting is
confidential, unless they check the open ballot box.
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UNOCAL CORPORATION
Possible Questions from Stockholders
The following are some possible questions from the stockholders. In no way
will this incorporate every question that can be asked. For questions on
matters not covered in the annual report or proxy statement, please refer
the stockholders to the Shareholder Services department.
Refer the stockholders to the appropriate page(s) in the 1996 Proxy
statement regarding questions on any of the shareholder proposals. Please
do not speculate on these matters. If a stockholder wants more information
than is provided in the Proxy Statement, please refer them to the
Shareholder Services department.
Three stockholder proposals (page number in proxy statement):
Item 3 Stockholder Proposal:--Review and report on Company's international
code of conduct (page 16)
Directors' Recommendation for Item 3 (pages 17-19); also refer to Unocal's
Statement of Principles on page 17.
Item 4 Stockholder Proposal:--Report on a gas plant expansion in Northern
Alberta, Canada (page 20)
Directors' Recommendation for Item 4 (pages 20-22).
Item 5 Stockholder Proposal:--Review and report annually on pollution
prevention options (page 22)
Directors' Recommendation for Item 5 (pages 22-24); also refer to Unocal's
Statement of Environmental Principles on page 24.
Note: the inside cover of the Proxy Statement is a table of contents
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Q & A's
Q. I don't want to bother with reading the proxy statement and voting
instructions. How can I vote without going through all of that?
A. If you wish to fully exercise your rights as a stockholder, it
would be to your benefit to read the proxy statement. It contains
information about the Directors, Executive Compensation, and
Stockholder Proposals and these items may be of interest to you as
a stockholder. The Board of Directors has indicated on your proxy
card its voting recommendations. It only takes a few moments to
sign, date and mail your proxy card in the return envelope.
Q. What is confidential voting? I thought my vote was always
confidential.
A. Unocal's Board of Directors wishes to encourage stockholder
participation in corporate governance by ensuring confidentiality
of stockholder voting. An independent third party (Chemical Mellon
Shareholder Services, L.L.C.) has been retained to receive and
tabulate stockholder proxy votes.
The Directors believe, however, that some stockholders want the
company to know how they have voted. Those shareholders can check
the open ballot box on the proxy and the company will be given those
proxies. The manner in which any stockholder votes on any
particular issue shall, subject to any federal or state law
requirements, be confidential unless the shareholder has checked
the open ballot box on the proxy card.
Q. What is the relationship of Unocal Corporation and Union Oil Company?
A. Union Oil Company of California is a wholly-owned subsidiary of
Unocal Corporation, a Delaware company created in 1983 to become
the parent of Union Oil Company of California. The reorganization
was approved by the stockholders. Union Oil is the principal
operating subsidiary of Unocal.
Q. Some outside Directors own very few shares of Unocal Stock. Don't
they have any faith in the future of the Company?
A. The Board Governance Committee seeks candidates for the Company's
Board of Directors who have distinguished themselves in their
business or profession, who have the highest standards of integrity
and independence, and
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who possess experience which will enable them to make a meaningful
contribution to the Company. The size of their Unocal stockholding
is not an important factor in the selection process.
Q. Why doesn't Unocal have a member of a minority group on its Board
of Directors?
A. Unocal has one woman on it's Board. In selecting candidates for
the Company's Board of Directors, the Board Governance Committee
considers candidates with a variety of backgrounds.
Q. Compensation paid to officers is certainly high; it seems excessive
to me.
A. (Listen and don't try to refute the stockholder's comments on this
subject.)
The 1996 proxy statement (paegs 7-9) contains detailed disclosures
on officer compensation required by the SEC. We thank you for your
comments. If you like, I will pass your comments on to the
appropriate management.
Q. In 1990, the Company implemented a stockholder rights plan. Do you
really think this is in the best interest of the stockholder?
A. Absolutely. Over 1,000 companies have implemented similar rights
plans to encourage any acquiring entity to deal directly with the
Board of Directors. This gives the Board the opportunity to protect
stockholders by rejecting offers that are clearly inadequate.
Q. Net earnings for Unocal were over $297 million in 1995. What do you
expect for 1996?
A. We are unable to make estimates of Unocal's future performance. The
1995 Annual Report will give you an overview of the prior year's
performance. The "Management Discussion and Analysis" section
(Pages 22-29) of the Annual Report discusses the company's outlook
for future performance. Also, please refer the stockholder to the
various forward-looking goals mentionned in the forward section of
the Annual Report.
Q. Does Unocal have any published Governance policies?
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A. Unocal has set forth their system of corporate governance on Page 20
of the annual report. This section is simple and to the point,
please refer stockholders to it.
Q. What about Unocal's environmental expenditures?
A. Unocal continues to make substantial capital and operating
expenditures for environmental protection and to comply with
federal, state and local laws and provisions regulating the
discharge of materials into the environment. Investigatory or
remedial work is now required at various sites even though past
operations followed practices and procedures that were considered
acceptable under environmental laws and regulations, if any,
existing at the time (further discussion in the Annual Report
- pages 26-27).
Note: Unocal has published a report regarding environmental issues. Please
offer to send them a copy. Upon request, an update will be available later
this summer. It will also be available later this summer on Unocal's Web
Sight.
Q. Why did Unocal introduce a reformulated gasoline (RFG)?
A. Unocal converted its refining system to produce RFG for So. Ca. that
meets federal E.P.A. guidelines. That fuel was due on the market
last year. The company has also geared up and is producing
Unocal-patented gasoline's that meets more stringent standards set
by the Ca. Air Resources Board (CARB). That gasoline had to be in
production by March 1, 1996, and on the market by June 1.
Q. What is the new gasoline gas do?
A. It is a cleaner burning gasoline. All people in California will be
filling their tanks with cleaner-burning gasoline. According to
CARB, this gasoline will produce the largest single emission
reduction in the last decade. The cleaner -burning gasoline will
remove 3 million pounds of pollution from Ca. skies every day, the
emission reduction equivalent of taking 3.5 million cars off Ca.
roads. At the end of the first year, more than one billion pounds
fewer pounds of pollution will have been emitted, reducing potential
health risks.
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Q. Will the new Unocal gasoline work in my car?
A. Yes, consistent with current gasoline's being used in Ca., it will
be available in three octane levels.
Q. Why do we need it?
A. Stricter emission controls have helped reduce the levels of
pollution in the air, but further improvements are necessary. At
some point in the year, 90% of all Californians live in areas that
did not meet Clean Air Act standards. Since cars are responsible
for at least half of the emissions in the skies, cleaner burning
gasoline's are considered the best and most effective means of
reducing emissions in Ca. That is why it is required to use the
cleaner-burning gasoline to meet standards set by the Ca. Air
Resources Board.
Q. Why did the price of gasoline go up so much?
A. Based upon a recent statement from Unocal's 76 Products Company,
there are three basic factors contributing to the price increases:
World crude prices are the highest they have been since the Gulf War.
According to the Ca. Energy Commission, the unexpected increase within a
brief span, translates into approximately 12.5 cents more per gallon
Unpredictable problems at refineries resulted in lower gasoline production,
particularly in Ca., further decreasing gasoline supplies forcing price
increases, contributing 7-8 cents per gallon
State-mandated introduction of cleaner burning gasoline, which will reduce
the emissions equivalent to 3.5 million cars from Ca. Roads each day and
will help give cleaner air to all of us. Ca. Air Resources Board and other
industry sources, increased the per-gallon price of gasoline by
approximately 10 cents.
The price increase items above are estimates and may vary due to other
factors.
Q. Will Unocal spin-off the 76 Products Division? Will it go public?
A. The immediate focus for 76 Products is to improve profitability.
We want to isolate those assets that are strictly involved in the
refining and marketing of
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petroleum products on the West Coast., so that we can more
effectively compete in the fast-changing retail market in the West.
We cannot comment on future plans for the division. Please see
pages 14-17 of the 1995 Annual Report for discussion of 76 Products.
Q. How should we handle questions about UCL and UXC common stock,
their individual account(s) and the UXC/UCL merger.
A. Any questions regarding stockholder accounts should be referred to
Chemical Mellon as Transfer Agent, telephone 1-800-647-4273 or
Unocal's Stockholder Services department. Any questions regarding
this merger, refer to the Shareholder Services Dept.
Q. Questions about the Union Oil/UXC merger.
A. In general - for every share of UXC owned, stockholders received
.54 of a share of Unocal common stock. Any additional discussion
should be referred to Stockholder Services.
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Telephone List
Shareholder Services -- Saturn Building Room 215
Matthew Davino Extension 6475 (network: 229 - 6475)
David Whitehurst Extension 6477 (network: 229 - 6477)
John Dillon Extension 6476 (network: 229 - 6476)
FAX Numbers: (714) 985-6363
Toll Free Telephone Numbers
Shareholder Services (800) 252-2233
Chemical Mellon Shareholder Services (800) 647-4273
(Transfer Agent)
Marketing Customer Service (800) 944-7676
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Key
TELEPHONE NUMBERS
(1) (area code) 000 - 0000
Stockholder request - do not call
(2) (...) ... - ....
LOOK UP TELEPHONE NUMBER
If an indicated telephone number is incorrect, make a note of it on your
telephone sheet. Please note any updated telephone numbers on the sheet
as well
VOTING CODES
******* SHARES
OUTSTANDING
Means the stockholder has not voted at the time the report was produced.
The Shareholder Services staff has access to updated voting records. We
can tell if the stockhold has voted, but NOT how they voted.
******* SHARES
VOTED
Means the stockholder has voted and no longer needs a call or a follow
up call. Unless you have promised to get back to them with a response.
