UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
Form 11-K
For Annual Reports of Employee Stock Purchase, Savings
and Similar Plans Pursuant to Section 15(d)
of the Securities Exchange Act of 1934
(Mark One)
[X] Annual Report Pursuant to Section 15(d) of the
Securities Exchange Act of 1934
For the fiscal year ended December 31, 1997
OR
[ ] Transition Report Pursuant to Section 15(d) of the
Securities Exchange Act of 1934
A. Full title of the plan and the address of the
plan, if different from that of the issuer
named below:
THE LL&E SAVINGS PLAN
(Full title of the plan)
B. Name of issuer of the securities held
pursuant to the plan and the address of its
principal executive office:
THE LOUISIANA LAND AND EXPLORATION COMPANY
909 Poydras Street
P. O. Box 60350
New Orleans, Louisiana 70160
<PAGE>
Financial Statements and Exhibit
Page
Number
(a) Financial Statements Herein
Independent Auditors' Report .................. 3
Statements of Net Assets Available for Benefits -
December 31, 1997 and 1996................... 4
Statement of Changes in Net Assets Available
for Benefits - year ended December 31,
1997......................................... 5
Notes to Financial Statements.................. 6
Supplemental Schedules
Schedule I - Line 27a - Schedule of Assets
Held for Investment Purposes............... 26
Schedule II - Line 27d - Schedule of Reportable
Transactions............................... 27
(b) Exhibit
Exhibit No. Description
23 Consent of KPMG Peat
Marwick LLP 29
2
<PAGE>
INDEPENDENT AUDITORS' REPORT
The Louisiana Land and Exploration Company
Benefits Committee:
We have audited the statements of net assets available for benefits of The LL&E
Savings Plan as of December 31, 1997 and 1996, and the related statement of
changes in net assets available for benefits for the year ended December 31,
1997. These financial statements are the responsibility of the Plan's
management. Our responsibility is to express an opinion on these financial
statements based on our audits.
We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audits to obtain
reasonable assurance about whether the financial statements are free of material
misstatement. An audit includes examining, on a test basis, evidence supporting
the amounts and disclosures in the financial statements. An audit also includes
assessing the accounting principles used and significant estimates made by
management, as well as evaluating the overall financial statement presentation.
We believe that our audits provide a reasonable basis for our opinion.
In our opinion, the financial statements referred to above present fairly, in
all material respects, the net assets available for benefits of the Plan at
December 31, 1997 and 1996, and the changes in net assets available for benefits
for the year ended December 31, 1997, in conformity with generally accepted
accounting principles.
Our audits were performed for the purpose of forming an opinion on the basic
financial statements taken as a whole. The information included in Schedules I
and II is presented to comply with the Department of Labor Rules and Regulations
for Reporting and Disclosure under the Employee Retirement Income Security Act
of 1974. Such information has been subjected to the auditing procedures applied
in the audits of the basic financial statements and, in our opinion, is fairly
stated in all material respects in relation to the basic financial statements
taken as a whole.
s/ KPMG Peat Marwick LLP
KPMG Peat Marwick LLP
New Orleans, Louisiana
June 5, 1998
3
<PAGE>
<TABLE>
THE LL&E SAVINGS PLAN
Statements of Net Assets Available for Benefits
<CAPTION>
December 31,
-----------------------------
1997 1996
------------ ------------
ASSETS
<S> <C> <C>
Cash and cash equivalents at
cost plus accrued interest ........ $ 170,077 $ 47
Company Stock ........................ 54,277,481 * 45,456,396 *
LL&E Royalty Trust Units
of Beneficial Interest ............ 200,350 201,779
Investment in Funds
Schwab Value Advantage ............ 7,691,521 * 9,308,031 *
Vanguard Bond Index ............... 2,448,027 2,776,207
Vanguard Index Trust 500
Portfolio ....................... 16,371,862 * 13,263,744 *
PBHG Growth ....................... 6,662,103 * 10,654,683 *
Janus Worldwide ................... 6,676,176 * 5,738,877 *
Hotchkis & Wiley Balanced Income .. 466,721 --
Strong Schafer Value .............. 3,851,881 --
Loans to participants ................ 2,126,899 3,161,633
------------ ------------
100,943,098 90,561,397
LIABILITIES AND PLAN EQUITY
Loans payable to LL&E ................ -- 24,148
Interest payable to LL&E ............. -- 48
------------ ------------
Net assets available for benefits .... $100,943,098 $ 90,537,201
============ ============
*Represents more than 5% of Plan assets
</TABLE>
4
<PAGE>
<TABLE>
THE LL&E SAVINGS PLAN
Statement of Changes in Net Assets Available for Benefits
<CAPTION>
Year Ended
December 31,
1997
-------------
<S> <C>
Interest and royalty income ............................ $ 667,569
Dividend income ........................................ 1,291,927
Interest income on loans
to participants ..................................... 200,955
Net realized gain on disposition
of investments ...................................... 1,793,721
Net unrealized appreciation
of investments ...................................... 15,310,690
Contributions
Employer allocated .................................. 2,641,847
Employer unallocated ................................ 24,329
Employees ........................................... 2,599,140
Benefit payments for
terminations and withdrawals ........................ (14,124,281)
-------------
Change in net assets
available for benefits .............................. 10,405,897
Net assets available for
benefits - beginning of year ........................ 90,537,201
-------------
Net assets available for
benefits - end of year .............................. $ 100,943,098
=============
</TABLE>
5
<PAGE>
THE LL&E SAVINGS PLAN
Notes to Financial Statements
1. Plan Description
The following description of The LL&E Savings Plan (the Plan)
provides only general information. The amended and restated
Plan document and subsequent amendments more fully explain the
details of the Plan and are made available to Plan
participants by the Plan administrator.
a. General
The Plan is a trusteed, defined contribution plan,
covering all full time employees of The Louisiana
Land and Exploration Company (LL&E) and designated
subsidiaries. The Plan is subject to the provisions
of The Employee Retirement Income Security Act of
1974 (ERISA), as amended.
b. Investment Funds
A trust agreement between LL&E and Charles Schwab
Trust Company (Schwab), provides for Schwab to
maintain trust funds on behalf of the Plan. The trust
funds are segregated into investment funds as
follows.
o Fund A for employees' and employer's
contributions which, prior to October 22,
1997, were invested primarily in Capital
Stock of LL&E and subsequently are invested
in Common Stock of Burlington Resources,
Inc. (BR or the Company), collectively the
Company Stock.
o Fund B for loans to participants. The notes
receivable resulting from loans to
participants are maintained in this fund.
Benefit payments for terminations and
withdrawals in this fund relate to the
cancellation of loans by participants
withdrawing from the Plan.
o Fund C contains LL&E Royalty Trust Units of
Beneficial Interest. No new amounts are
being invested in this fund, except that
income on existing Royalty Trust Units and
any repayments of loans to participants in
this fund are reinvested in additional
Units.
o Fund D for employees' contributions which
are invested in the Schwab Value Advantage
Money Fund, which invests in high quality
short-term debt securities such as
certificates of deposit, commercial paper
and publicly traded bonds.
o Fund E for employees' contributions which
are invested in the Vanguard Bond Index
Total Bond Market Fund, which invests in a
portfolio of fixed income securities
selected to match the Lehman Brothers
Aggregate Bond Index which encompasses U.S.
Treasury and agency securities, corporate
bonds and mortgage-backed securities, with
maturities greater than one year.
6
<PAGE>
THE LL&E SAVINGS PLAN
Notes to Financial Statements
o Fund F for employees' contributions which
are invested in the Vanguard Index Trust 500
Portfolio, which invests in all 500 stocks
in the Standard & Poor's 500 Index in
approximately the same proportions as they
are represented in the Index.
o Fund G for employees' contributions which
are invested in the PBHG Growth Fund, which
invests in common stocks and convertible
securities of companies with market
capitalization or annual revenues under $1.5
billion.
o Fund H for employees' contributions which
are invested in the Janus Worldwide Fund,
which invests in common stocks of foreign
and domestic companies.
o Fund I for employees' contributions,
beginning January 1, 1997, which are
invested in the Hotchkis & Wiley Balanced
Income Fund, which invests in equity
securities of domestic and foreign
companies, fixed-income securities and money
market obligations.
o Fund J for employees' contributions,
beginning January 1, 1997, which are
invested in the Strong Schafer Value Fund,
which invests in common stocks of domestic
companies and other equity securities.
Participants in the Plan are permitted to direct the
investment of their contributions to the Plan in any
of Funds A, D, E, F, G, H, I or J and up to eight
transfers per year between these funds are allowed on
a daily basis.
The investment and changes therein of all funds are
determined through the use of quoted market prices.
Realized gains or losses and unrealized appreciation
or depreciation of investments are determined in
accordance with Department of Labor regulations for
Form 5500. The cost basis of investments are either
fair market value at the beginning of the year and/or
cost of current year additions, as appropriate.
Dispositions of investments are on a first-in,
first-out basis.
7
<PAGE>
THE LL&E SAVINGS PLAN
Notes to Financial Statements
The number of participants by fund at December 31,
1997 was as follows.
Number of
Fund Participants
A 555
B 240
C 62
D 261
E 231
F 457
G 405
H 366
I 43
J 171
Since, within certain limitations, investments may be
made simultaneously in more than one fund by an
individual participant, an individual may be included
more than once in the above count. The individual
participants in the Plan at December 31, 1997
numbered 555.
c. Contributions and Benefits
1. Non-Contributory Participation
The employer contributes monthly to the Plan
participants' account an amount determined
in accordance with the following schedule.
Percent of Covered
Credited Service Compensation
Less than 5 years 2%
5 years or more 4%
Non-contributory participation is not
dependent on the eligible employees'
contributory participation and all
contributions are invested in Company Stock.
2. Contributory Participation
Employees are allowed to make tax-deferred
contributions to the Plan in the amount
of between 2% and 12% of compensation.
The amount of tax-deferred contributions
are limited by federal tax legislation.
Where tax-deferred contributions elected by
participants exceed these limitations, any
excess tax-deferred contributions are
distributed to the affected parties or
deferred until termination or retirement.
8
<PAGE>
THE LL&E SAVINGS PLAN
Notes to Financial Statements
In addition to the non-contributory
participation, the employer will contribute
to the participants' account an amount based
on a percentage of the dollar amount
contributed voluntarily, if any, by the
participants. The additional employer's
contributions are applicable to voluntary
participant contributions which are not in
excess of 6% of covered compensation and are
determined in accordance with the following
schedule.
Percent of Voluntary
Contribution Matched
Credited Service by Employer
Less than 5 years 50%
5 years or more 100%
Participants pay no federal income
tax on their tax-deferred contributions, on
the employer contributions, or on any
earnings on their accounts until
withdrawals or distributions are made from
their accounts.
3. Other Significant Provisions
Participants in the Plan become
fully vested in their account balance
derived from employer contributions upon the
earliest to occur of the following.
o Completion of five years of service
o Attainment of age 65
o Retirement pursuant to the early
retirement provisions of The LL&E
Pension Plan
o Death
o Termination of employment by reason of
a reduction in labor force
o Total disability, as defined in the Plan
o In the event of a change in control,
as defined in the Plan
o Under certain circumstances in the
event of a change in control as defined
in The LL&E Special Termination
Benefit Plan in the case of certain
covered employees.
Participants are at all times fully
vested in their account balance derived from
their own contributions, including any
earnings or losses.
Participants may elect that the
vested portions of employer and employee
contributions, plus income or earnings, be
distributed to them in a lump sum i) as soon
as practicable following termination of
employment, ii) on or about the date one
year after termination of employment or iii)
on or about age 65. Upon termination, other
than described above, nonvested employer
contributions and earnings are forfeited by
participants and such amounts reduce
employer contributions under the Plan.
9
<PAGE>
THE LL&E SAVINGS PLAN
Notes to Financial Statements
Participants in the Plan may make a
qualified plan rollover contribution or an
individual retirement account rollover
contribution, as defined in the Plan. The
contributions may only be made if they meet
the requirements of a tax-free rollover for
federal income tax purposes.
After-tax contributions to the Plan
are no longer an option, however, employees
may still have after-tax account balances.
Participants can withdraw all or any portion
of their after-tax contributions, plus
earnings.
Participants cannot withdraw any
tax-deferred contributions or any earnings
while employed at LL&E. Participants may,
as of any valuation date, withdraw all or
any portion of their vested account balance
derived from matching employer
contributions, and earnings, subject to
several specific rules as defined in the
Plan.
Participants may borrow (Fund B)
from the portions of their account derived
from employer contributions except ESOP's,
transfers from the LL&E Benefit Plan and
tax-free rollovers, and employee
tax-deferred contributions, and earnings,
subject to several specific rules as defined
in the Plan. A participant may have two
loans outstanding at any given time but no
loan(s) from the Plan may be in excess of
the lesser of $50,000 or 50% of the
participant's vested account balance.
Repayments will be made through payroll
deductions over optional terms from twelve
to sixty months (in twelve month increments)
and may be prepaid by paying the full
outstanding balance. The annual loan
interest rate is fixed from time to time at
the prime rate. Loans are secured by the
applicable participant's vested account
balance.
d. Termination of the Plan
The Employer has the right under the Plan to modify
the benefits provided and to terminate the Plan
subject to the provisions set forth in ERISA.
2. Summary of Accounting Policies
The accompanying financial statements have been prepared on
an accrual basis in accordance with generally accepted
accounting principles (GAAP). The preparation of financial
statements in conformity with GAAP requires certain estimates
and assumptions. Actual results may differ from those
estimates.
Benefits payable for terminations and withdrawals are included
in Plan equity and are charged to income when paid. This
accounting method differs from that required in Department of
Labor Form 5500 which requires benefits payable to be accrued
and charged to income in the period the liability
10
<PAGE>
THE LL&E SAVINGS PLAN
Notes to Financial Statements
arises. Accordingly, net assets available for benefits as of
December 31, 1997 and 1996 and changes in net assets available
for benefits for the year ended December 31, 1997 differ from
that reported in Form 5500 as follows.
<TABLE>
<CAPTION>
Net Assets Available
for Benefits
December 31,
------------------------------
1997 1996
------------- -------------
<S> <C> <C>
As reported .............. $ 100,943,098 $ 90,537,201
Effect of accrued benefits
payable ................ (6,623,135) (5,010,805)
------------- -------------
As reported in Form 5500 . $ 94,319,963 $ 85,526,396
============= =============
</TABLE>
<TABLE>
<CAPTION>
Changes in Net Assets
Available for Benefits
Year Ended
December 31,
------------
1997
<S> <C>
As reported .............. $ 10,405,897
Effect of accrued benefits
payable ................ (1,612,330)
------------
As reported in Form 5500 . $ 8,793,567
============
</TABLE>
3. Net Realized Gains on Disposition of Investments
The following is a summary of net realized gains on the
disposition of investments for the year ended December 31,
1997.
<TABLE>
<CAPTION>
<S> <C>
Aggregate market value of Company Stock sold ... $ 7,573,492
Aggregate cost basis of Company Stock sold ..... 6,622,745
-----------
Net realized gains on sale of Company Stock .... 950,747
-----------
Aggregate market value of other investments sold 18,833,198
Aggregate cost basis of other investments sold . 17,990,224
-----------
Net realized gains on sale of other investments 842,974
-----------
$ 1,793,721
===========
</TABLE>
11
<PAGE>
THE LL&E SAVINGS PLAN
Notes to Financial Statements
4. Employee Stock Ownership Plan Fund
In November 1987, the Employee Stock Ownership Plan Fund
(ESOP) was created using funds borrowed from LL&E. To fund the
ESOP I, LL&E borrowed $10.2 million (unsecured) from a bank
and loaned the proceeds to the ESOP I. The ESOP I then used
the proceeds to acquire 374,678 shares of LL&E Capital Stock
at an average market price of $27 1/8 per share. The loan to
the ESOP I was secured by LL&E's Capital Stock owned by the
ESOP I and was subject to substantially the same repayment
terms as LL&E's bank loan. The interest rate was fixed at
8.2%. By amendment dated November 19, 1994 to the loan
agreement, LL&E's loan to ESOP I was extended to November 1997
and the interest rate was fixed at 7.4%. The ESOP I repaid the
loan, with interest, from LL&E's contributions to the fund
along with quarterly dividends paid on the Capital Stock
acquired with the ESOP I loan proceeds. The Capital Stock of
LL&E acquired by the ESOP I was initially classified as
unallocated by the Plan. As principal payments were made to
LL&E, shares of Capital Stock were reclassified to allocated
in an amount equal to the principal payment divided by the
average purchase price of $27 1/8. In May 1996, the final loan
payment was made to LL&E and all shares of Capital Stock were
reclassified to allocated.
On May 3, 1988, LL&E obtained additional financing of
approximately $14 million (unsecured) from a bank and loaned
the proceeds to the ESOP II. The ESOP II then used the
proceeds to acquire 461,690 shares of LL&E Capital Stock at an
average purchase price of $30.25 per share. The loan to the
ESOP II was secured by LL&E's Capital Stock owned by the ESOP
II and was subject to substantially the same repayment terms
as LL&E's bank loan. The interest rate was fixed at 8.2%. By
amendment dated May 31, 1995 to the loan agreement, LL&E's
loan to ESOP II was extended to May 1998 and the interest rate
was fixed at 6.1%. The ESOP II repaid the loan, with interest,
from LL&E's contributions to the fund along with quarterly
dividends paid on the Capital Stock acquired with the ESOP II
loan proceeds.
The Capital Stock of LL&E acquired by the ESOP II was
initially classified as unallocated by the Plan. As principal
payments were made to LL&E, shares of Capital Stock were
reclassified to allocated in an amount equal to the principal
payment divided by the average purchase price of $30.25. As of
December 31, 1996, all shares of Capital Stock were
reclassified to allocated. The final loan payment to LL&E was
made in January 1997.
5. Distribution of LL&E Royalty Trust Units of Beneficial
Interest
LL&E Royalty Trust Units of Beneficial Interest (the Units)
were distributed by LL&E to holders of record of its Capital
Stock on June 22, 1983 on the basis of one Unit for each two
shares of Capital Stock owned on such date. The Units received
by the Plan (Fund C) were allocated among the respective
accounts of participants in proportion to the number of shares
of Capital Stock in each account at the record date of the
12
<PAGE>
THE LL&E SAVINGS PLAN
Notes to Financial Statements
distribution of the Units and are maintained separately.
Monthly royalty income attributable to the Units are allocated
to participants on the same basis and are reinvested in
additional Units.
Participants have the right to decide when the Units allocated
to their respective accounts will be sold. Participants may
exercise a single election to sell all of their Units and have
the proceeds reinvested in other funds of the Plan.
6. Federal Income Taxes
LL&E has received a favorable determination letter from the
Internal Revenue Service dated July 25, 1995, for the Plan as
restated June 1, 1994, for all amendments adopted through June
15, 1994. The determination letter was approved subject to the
adoption of the First Amendment to the restated Plan, which
was adopted on August 21, 1995. The letter states that the
Plan qualifies under the provisions of Section 401(a) of the
Internal Revenue Code.
The Plan has subsequently been amended. LL&E does not expect
the Plan's qualifications under the provisions of 401(a) and
401(k) of the Internal Revenue Code or its federal income tax
exempt status under Section 501(a) of the Internal Revenue
Code to change due to the amendments since the restatement.
7. Fees And Expenses
Expenses incurred in administering the Plan are paid by the
employer. Expenses in connection with investment security
transactions are added to cost or deducted from the proceeds.
8. Other Matters
On October 22, 1997, LL&E was merged with and into BR. As a
result, LL&E became a wholly-owned subsidiary of BR and each
outstanding share of Capital Stock of LL&E, including that
held by the Plan, was exchanged for 1.525 shares of Common
Stock of BR. As a result of the significant number of
terminations in 1998 resulting from the merger, Plan assets
are expected to be reduced substantially in 1998. The Company
is currently revising its benefits structure effective January
1, 1999, and has not yet determined the terms of the Plan.
13
<PAGE>
THE LL&E SAVINGS PLAN
Notes to Financial Statements
9. Fund Information
Net assets available for benefits by fund at December 31, 1997
and 1996 were as follow.
<TABLE>
<CAPTION>
December 31, 1997
Participant Directed
FUND FUND FUND
A B C
---------- ---------- ----------
ASSETS
<S> <C> <C> <C>
Cash and cash equivalents
at cost plus accrued
interest ............. $ 6,584 $ -- $ --
Company Stock ............ 2,109,395 -- --
LL&E Royalty Trust Units
of Beneficial Interest -- -- 200,350
Investment in Funds
Schwab Value Advantage -- -- --
Vanguard Bond Index .. -- -- --
Vanguard Index Trust
500 Portfolio ...... -- -- --
PBHG Growth .......... -- -- --
Janus Worldwide ...... -- -- --
Hotchkis & Wiley
Balanced Income .... -- -- --
Strong Schafer Value . -- -- --
Loans to participants .... -- 2,126,899 --
---------- ---------- ----------
Net assets available
for benefits ......... $2,115,979 $2,126,899 $ 200,350
========== ========== ==========
Number of shares/units
outstanding .......... 47,072 40,556
========== ==========
Per share/unit ........... $ 44.952 $ 4.940
========== ==========
(Continued)
</TABLE>
14
<PAGE>
THE LL&E SAVINGS PLAN
Notes to Financial Statements
9. Fund Information, continued.
<TABLE>
<CAPTION>
December 31, 1997
Participant Directed
FUND FUND FUND
D E F
----------- ----------- ----------
ASSETS
<S> <C> <C> <C>
Cash and cash equivalents
at cost plus accrued
interest ............. $ -- $ -- $ --
Company Stock ............ -- -- --
LL&E Royalty Trust Units
of Beneficial Interest -- -- --
Investment in Funds
Schwab Value Advantage 7,691,521 -- --
Vanguard Bond Index .. -- 2,448,027 --
Vanguard Index Trust
500 Portfolio ...... -- -- 16,371,862
PBHG Growth .......... -- -- --
Janus Worldwide ...... -- -- --
Hotchkis & Wiley
Balanced Income .... -- -- --
Strong Schafer Value . -- -- --
Loans to participants .... -- -- --
----------- ----------- -----------
Net assets available
for benefits ......... $ 7,691,521 $ 2,448,027 $16,371,862
=========== =========== ===========
Number of shares/units
outstanding .......... 7,691,521 242,619 181,768
=========== =========== ===========
Per share/unit ........... $ 1.000 $ 10.090 $ 90.070
=========== =========== ===========
(Continued)
</TABLE>
15
<PAGE>
THE LL&E SAVINGS PLAN
Notes to Financial Statements
9. Fund Information, continued
<TABLE>
<CAPTION>
December 31, 1997
Participant Directed
FUND FUND FUND
G H I
---------- ---------- ----------
ASSETS
<S> <C> <C> <C>
Cash and cash equivalents
at cost plus accrued
interest ............. $ -- $ -- $ --
Company Stock ............ -- -- --
LL&E Royalty Trust Units
of Beneficial Interest -- -- --
Investment in Funds
Schwab Value Advantage -- -- --
Vanguard Bond Index .. -- -- --
Vanguard Index Trust
500 Portfolio ...... -- -- --
PBHG Growth .......... 6,662,103 -- --
Janus Worldwide ...... -- 6,676,176 --
Hotchkis & Wiley
Balanced Income .... -- -- 466,721
Strong Schafer Value . -- -- --
Loans to participants .... -- -- --
---------- ---------- ----------
Net assets available
for benefits ......... $6,662,103 $6,676,176 $ 466,721
========== ========== ==========
Number of shares/units
outstanding .......... 262,391 176,712 24,195
========== ========== ==========
Per share/unit ........... $ 25.390 $ 37.780 $ 19.290
========== ========== ==========
(Continued)
</TABLE>
16
<PAGE>
THE LL&E SAVINGS PLAN
Notes to Financial Statements
9. Fund Information, continued
<TABLE>
<CAPTION>
December 31, 1997
Participant Employer
Directed Directed
FUND FUND
J A TOTAL
------------ ------------ ------------
ASSETS
<S> <C> <C> <C>
Cash and cash equivalents
at cost plus accrued
interest ............. $ -- $ 163,493 $ 170,077
Company Stock ............ -- 52,168,086 54,277,481
LL&E Royalty Trust Units
of Beneficial Interest -- -- 200,350
Investment in Funds
Schwab Value Advantage -- -- 7,691,521
Vanguard Bond Index .. -- -- 2,448,027
Vanguard Index Trust
500 Portfolio ...... -- -- 16,371,862
PBHG Growth .......... -- -- 6,662,103
Janus Worldwide ...... -- -- 6,676,176
Hotchkis & Wiley
Balanced Income .... -- -- 466,721
Strong Schafer Value . 3,851,881 -- 3,851,881
Loans to participants .... -- -- 2,126,899
------------ ------------ ------------
Net assets available
for benefits ......... $ 3,851,881 $ 52,331,579 $100,943,098
============ ============ ============
Number of shares/units
outstanding .......... 60,280 1,164,141
============ ============
Per share/unit ........... $ 63.900 $ 44.953
============ ============
(Continued)
</TABLE>
17
<PAGE>
THE LL&E SAVINGS PLAN
Notes to Financial Statements
9. Fund Information, continued
<TABLE>
<CAPTION>
December 31, 1996
Participant Directed
FUND FUND FUND
A B C
---------- ---------- ----------
ASSETS
<S> <C> <C> <C>
Cash and cash equivalents
at cost plus accrued
interest ............. $ -- $ -- $ --
Company Stock ............ 1,736,970 -- --
LL&E Royalty Trust Units
of Beneficial Interest -- -- 201,779
Investment in Funds
Schwab Value Advantage -- -- --
Vanguard Bond Index .. -- -- --
Vanguard Index Trust
500 Portfolio ...... -- -- --
PBHG Growth .......... -- -- --
Janus Worldwide ...... -- -- --
Loans to participants .... -- 3,161,633 --
---------- ---------- ----------
1,736,970 3,161,633 201,779
LIABILITIES AND PLAN EQUITY
Loans payable to LL&E .... -- -- --
Interest payable to LL&E . -- -- --
---------- ---------- ----------
Net assets available
for benefits ......... $1,736,970 $3,161,633 $ 201,779
========== ========== ==========
Number of shares/units
outstanding .......... 32,372 41,382
========== ==========
Per share/unit ........... $ 53.657 $ 4.876
========== ==========
(Continued)
</TABLE>
18
<PAGE>
THE LL&E SAVINGS PLAN
Notes to Financial Statements
9. Fund Information, continued
<TABLE>
<CAPTION>
December 31, 1996
Participant Directed
FUND FUND FUND
D E F
---------- ---------- ----------
ASSETS
<S> <C> <C> <C>
Cash and cash equivalents
at cost plus accrued
interest ............. $ -- $ -- $ --
Company Stock ............ -- -- --
LL&E Royalty Trust Units
of Beneficial Interest -- -- --
Investment in Funds
Schwab Value Advantage 9,308,031 -- --
Vanguard Bond Index .. -- 2,776,207 --
Vanguard Index Trust
500 Portfolio ...... -- -- 13,263,744
PBHG Growth .......... -- -- --
Janus Worldwide ...... -- -- --
Loans to participants .... -- -- --
----------- ----------- -----------
9,308,031 2,776,207 13,263,744
LIABILITIES AND PLAN EQUITY
Loans payable to LL&E .... -- -- --
Interest payable to LL&E . -- -- --
----------- ----------- -----------
Net assets available
for benefits ......... $ 9,308,031 $ 2,776,207 $13,263,744
=========== =========== ===========
Number of shares/units
outstanding .......... 9,308,031 282,135 191,783
=========== =========== ===========
Per share/unit ........... $ 1.000 $ 9.840 $ 69.160
=========== =========== ===========
(Continued)
</TABLE>
19
<PAGE>
THE LL&E SAVINGS PLAN
Notes to Financial Statements
9. Fund Information, continued
<TABLE>
<CAPTION>
December 31, 1996
Participant Directed
FUND FUND
G H
----------- -----------
ASSETS
<S> <C> <C>
Cash and cash equivalents at
cost plus accrued interest $ -- $ --
Company Stock ................ -- --
LL&E Royalty Trust Units
of Beneficial Interest ... -- --
Investment in Funds
Schwab Value Advantage ... -- --
Vanguard Bond Index ...... -- --
Vanguard Index Trust
500 Portfolio .......... -- --
PBHG Growth .............. 10,654,683 --
Janus Worldwide .......... -- 5,738,877
Loans to participants ........ -- --
----------- -----------
10,654,683 5,738,877
LIABILITIES AND PLAN EQUITY
Loans payable to LL&E ........ -- --
Interest payable to LL&E ..... -- --
----------- -----------
Net assets available
for benefits ............. $10,654,683 $ 5,738,877
=========== ===========
Number of shares/units
outstanding .............. 405,584 170,344
=========== ===========
Per share/unit ............... $ 26.270 $ 33.690
=========== ===========
(Continued)
</TABLE>
20
<PAGE>
THE LL&E SAVINGS PLAN
Notes to Financial Statements
9. Fund Information, continued
<TABLE>
<CAPTION>
December 31, 1996
Employer
Directed
FUND
A TOTAL
----------- -----------
ASSETS
<S> <C> <C>
Cash and cash equivalents at
cost plus accrued interest ... $ 47 $ 47
Company Stock .................... 43,719,426 45,456,396
LL&E Royalty Trust Units
of Beneficial Interest ....... -- 201,779
Investment in Funds
Schwab Value Advantage ....... -- 9,308,031
Vanguard Bond Index .......... -- 2,776,207
Vanguard Index Trust 500
Portfolio .................. -- 13,263,744
PBHG Growth .................. -- 10,654,683
Janus Worldwide .............. -- 5,738,877
Loans to participants ............ -- 3,161,633
----------- -----------
43,719,473 90,561,397
LIABILITIES AND PLAN EQUITY
Loans payable to LL&E ............ 24,148 24,148
Interest payable to LL&E ......... 48 48
----------- -----------
Net assets available for benefits $43,695,277 $90,537,201
=========== ===========
Number of shares/units outstanding 815,273
===========
Per share/unit ................... $ 53.596
===========
</TABLE>
21
<PAGE>
THE LL&E SAVINGS PLAN
Notes to Financial Statements
10. Fund Information
Changes in net assets available for benefits by fund for the
year ended December 31, 1997 were as follow.
<TABLE>
<CAPTION>
Participant Directed
FUND FUND FUND
A B C
----------- ----------- -----------
<S> <C> <C> <C>
Interest and royalty
income ................. $ -- $ -- $ 28,041
Dividend income ........... 13,224 -- --
Interest income on loans
to participants ........ 43,086 (1,407,550) --
Net realized gains
(losses) on disposition
of investments ......... 181,393 -- (347)
Net unrealized appreciation
(depreciation) of
investments ............ 446,985 -- 1,174
Contributions
Employer allocated ..... -- -- --
Employer unallocated ... -- -- --
Employees .............. 95,336 -- --
Benefit payments for
terminations and
withdrawals ............ (231,423) (347,141) (30,309)
Transfers between
funds - net ............ (169,592) 719,957 12
----------- ----------- -----------
Changes in net assets
available for benefits . 379,009 (1,034,734) (1,429)
Net assets available for
benefits - beginning
of year ................ 1,736,970 3,161,633 201,779
----------- ----------- -----------
Net assets available for
benefits - end of year . $ 2,115,979 $ 2,126,899 $ 200,350
=========== =========== ===========
(Continued)
</TABLE>
22
<PAGE>
THE LL&E SAVINGS PLAN
Notes to Financial Statements
10. Fund Information, continued
<TABLE>
<CAPTION>
Participant Directed
FUND FUND FUND
D E F
----------- ------------ ------------
<S> <C> <C> <C>
Interest and royalty
income ................. $ 469,666 $ 169,862 $ --
Dividend income ........... -- -- 352,759
Interest income on loans
to participants ........ 184,174 118,391 501,271
Net realized gains
(losses) on disposition
of investments ......... -- 1,310 782,698
Net unrealized appreciation
(depreciation) of
investments ............ -- 58,625 3,262,394
Contributions
Employer allocated ..... -- -- --
Employer unallocated ... -- -- --
Employees .............. 274,566 140,615 818,539
Benefit payments for
terminations and
withdrawals ............ (1,727,333) (345,261) (2,604,636)
Transfers between
funds - net ............ (817,583) (471,722) (4,907)
----------- ------------ ------------
Changes in net assets
available for benefits . (1,616,510) (328,180) 3,108,118
Net assets available for
benefits - beginning
of year ................ 9,308,031 2,776,207 13,263,744
----------- ------------ ------------
Net assets available for
benefits - end of year . $ 7,691,521 $ 2,448,027 $ 16,371,862
=========== ============ ============
(Continued)
</TABLE>
23
<PAGE>
THE LL&E SAVINGS PLAN
Notes to Financial Statements
10. Fund Information, continued
<TABLE>
<CAPTION>
Participant Directed
FUND FUND FUND
G H I
------------ ------------ ------------
<S> <C> <C> <C>
Interest and royalty
income ................. $ -- $ -- $ --
Dividend income ........... -- 459,274 39,581
Interest income on loans
to participants ........ 391,051 256,339 5,533
Net realized gains
(losses) on disposition
of investments ......... (331,487) 310,397 7,322
Net unrealized appreciation
(depreciation) of
investments ............ (158,446) 452,268 (11,189)
Contributions
Employer allocated ..... -- -- --
Employer unallocated ... -- -- --
Employees .............. 628,140 440,878 23,609
Benefit payments for
terminations and
withdrawals ............ (1,435,914) (1,162,723) (1,811)
Transfers between
funds - net ............ (3,085,924) 180,866 403,676
------------ ------------ ------------
Change in net assets
available for benefits . (3,992,580) 937,299 466,721
Net assets available for
benefits - beginning
of year ................ 10,654,683 5,738,877 --
------------ ------------ ------------
Net assets available for
benefits - end of year . $ 6,662,103 $ 6,676,176 $ 466,721
============ ============ ============
(Continued)
</TABLE>
24
<PAGE>
THE LL&E SAVINGS PLAN
Notes to Financial Statements
10. Fund Information, continued
<TABLE>
<CAPTION>
Participant Employer
Directed Directed
FUND FUND
J A TOTAL
------------- ------------- ------------
<S> <C> <C> <C>
Interest and royalty
income ................. $ -- $ -- $ 667,569
Dividend income ........... 118,617 308,472 1,291,927
Interest income on loans
to participants ........ 79,896 28,764 200,955
Net realized gains
(losses) on disposition
of investments ......... 73,081 769,354 1,793,721
Net unrealized appreciation
(depreciation) of
investments ............ 297,653 10,961,226 15,130,690
Contributions
Employer allocated ..... -- 2,641,847 2,641,847
Employer unallocated ... -- 24,329 24,329
Employees .............. 177,457 -- 2,599,140
Benefit payments for
terminations and
withdrawals ............ (192,027) (6,045,703) (14,124,281)
Transfers between
funds - net ............ 3,297,204 (51,987) --
------------- ------------- ------------
Change in net assets
available for benefits . 3,851,881 8,636,302 10,405,897
Net assets available for
benefits - beginning
of year ................ -- 43,695,277 90,537,201
------------- ------------- ------------
Net assets available for
benefits - end of year . $ 3,851,881 $ 52,331,579 $ 100,943,098
============= ============= ============
(Continued)
</TABLE>
25
<PAGE>
<TABLE>
SCHEDULE I
THE LL&E SAVINGS PLAN
Line 27a - Schedule of Assets Held for Investment Purposes
December 31, 1997
<CAPTION>
Number of
shares, units
or principal Current
amount Cost value
------------ ------------ ------------
<S> <C> <C> <C>
Cash and cash equivalents ........... 170,077 $ 170,077 $ 170,077
Company Stock ....................... 1,211,213 63,078,616 54,277,481
LL&E Royalty Trust units ............ 40,556 258,421 200,350
Schwab Value Advantage Fund units ... 7,691,521 7,691,521 7,691,521
Vanguard Bond Index Total Bond
Market Fund units .............. 242,619 2,360,021 2,448,027
Vanguard Index Trust 500 Portfolio
Fund units ..................... 181,768 9,797,363 16,371,862
PBHG Growth Fund units .............. 262,391 6,070,483 6,662,103
Janus Worldwide Fund units .......... 176,712 5,426,664 6,676,176
Hotchkis & Wiley Balanced Income
Fund units ..................... 24,195 470,588 466,721
Strong Schafer Income Fund units .... 60,280 3,481,072 3,851,881
Participants' loans ................. -- -- 2,126,899*
------------ ------------
Total Assets Held for Investment
Purposes ..................... $ 98,804,826 $100,943,098
============ ============
* Participant loans bear interest between 8.25% and 8.50% and have maturities
ranging from one to five years.
</TABLE>
26
<PAGE>
<TABLE>
SCHEDULE II
THE LL&E SAVINGS PLAN
Line 27d - Schedule of Reportable Transactions
in Excess of 5% of the Current Value of Plan Assets
Year ended December 31, 1997
<CAPTION>
Expenses
Identity of Purchase Selling incurred with
party involved Description of assets price price transaction
- -------------- ---------------------- --------- ---------- ------------
<S> <C> <C> <C> <C>
Category (iii) - Series of Securities Transactions
Schwab Value Advantage
Money Fund ......... $5,536,156
Vanguard Index 500 ... 4,582,400
PBHG Growth Fund ..... 5,018,047
Capital Stock of The
Louisiana Land and
Exploration Company 4,936,054
There were no (i), (ii), or (iv) reportable transactions during the year.
(Continued)
</TABLE>
27
<PAGE>
<TABLE>
SCHEDULE II
(Continued)
THE LL&E SAVINGS PLAN
Line 27d - Schedule of Reportable Transactions
in Excess of 5% of the Current Value of Plan Assets
Year Ended December 31, 1997
<CAPTION>
Cost Current Value Net
Identity of of of assets on gain
party involved Description of assets assets transaction date (loss)
- -------------- ---------------------- --------- ---------------- ------
<S> <C> <C> <C> <C>
Category (iii) - Series of Securities Transactions
Schwab Value Advantage
Money Fund $ 5,536,156 $ 5,536,156 $ --
Vanguard Index 500 3,799,738 4,582,400 782,662
PBHG Growth Fund 5,349,578 5,018,047 (331,531)
Capital Stock of The
Louisiana Land and
Exploration Company 4,552,924 4,936,054 383,130
</TABLE>
28
The Benefits Committee
The Louisiana Land and Exploration Company:
We consent to incorporation by reference in the Registration Statements No.
2-98948, No. 33-22338 and No. 33-56209 on Form S-8 of The Louisiana Land and
Exploration Company of our report dated June 5, 1998, relating to the statements
of net assets available for benefits of The LL&E Savings Plan as of December 31,
1997 and 1996 and the related statement of changes in net assets available for
benefits and related schedules for the year ended December 31, 1997, which
report appears in the December 31, 1997 annual report on Form 11-K of The LL&E
Savings Plan.
s/ KPMG PEAT MARWICK LLP
KPMG PEAT MARWICK LLP
New Orleans, Louisiana
June 5, 1998
29
