Internal Bulletin
TO: Employee Stockholders
FROM: Roger Beach
RE: Voting Your Proxy
If you have not yet reviewed the 1998 Proxy Statement, I
urge you to do so and to complete and return your proxy
today. It contains information about three stockholder
proposals and other items that are important to you as a
stockholder and employee of Unocal.
Please keep in mind that if you do not vote, your votes
will NOT necessarily be cast in support of management.
Most employee shares are held in the Unocal Savings
Plan, whose trustee is required to cast unvoted shares
in the same proportion as all of the voted employee
shares.
Your proxy vote on your Savings Plan shares is always
confidential, and your vote on other shares is always
confidential unless you check the "open ballot" box on
your proxy. To ensure complete confidentiality, Unocal
has retained an independent third party to receive and
tabulate all votes.
Unocal's Board of Directors recommends votes against the
three stockholder proposals being considered. The
proposals are summarized below. Review the Proxy
Statement for more detailed arguments for and against
these proposals.
NO ON ITEM 4
The proposal requests the board of directors to
conduct a special review of the company's executive
compensation practices for all of the company's top
officers.
Our Position: Unocal's executive compensation is
determined by the board's Management Development and
Compensation Committee, which is composed of non-
employee directors and assisted by a highly regarded
compensation consulting firm, Strategic Compensation
Associates. The committee evaluates the individual
performances of Unocal's executive officers, and the
criteria upon which their compensation is based. In
the Proxy Statement, all stockholders are provided a
detailed review of our executive compensation
programs and policies. Based on compensation survey
data for our industry and peer group, Unocal remains
slightly below the estimated mean of total executive
compensation.
NO ON ITEM 5
This proposal requests that a committee of outside
directors conduct extensive research and publish a
report on the allegation that the Myanma Oil and Gas
Enterprise (MOGE) is serving as a conduit for illegal
drug-money laundering in Myanmar.
Our Position: The proposed resolution is identical
to one defeated last year by more than 94 percent of
the shares voted. It implies that Unocal officials
have knowledge of such activities allegedly conducted
by MOGE. This is absolutely false. Furthermore,
Unocal has no legal or contractual right to access
MOGE's accounting or other financial records required
for such an investigation, and would be unable to
comply with this resolution if it were passed.
NO ON ITEM 6
This proposal requests that the board of Directors
appoint a committee of outside directors to issue a
report on the actual and potential economic and
public relations costs to Unocal of opposition to its
business in Myanmar.
Our Position: Item 6 is identical to a proposal
rejected last year by more than 95 percent of the
shares voted. No report is necessary since the costs
are immaterial. Unocal's non-operating expenses for
government relations, public communications and legal
costs related to its Myanmar investments amounted to
less than 0.03 percent of Unocal's 1997 total assets
and 0.04 percent of its expenses.
Remember, your vote counts. Proposals must be rejected
by very high margins or they can be resubmitted year
after year.
Cast your vote today!
NEWSLINE is produced for employees by the Public
Relations and Communications Group in El Segundo,
California. It is posted on the SeventySix Home Page at
http://st.unocal.com/76.
