Filed by Chevron Corporation Pursuant to Rule 425 under the Securities Act of
1933 and deemed filed pursuant to Rule 14a-12 under the Securities Exchange Act
of 1934.
Subject Company: Texaco Inc.
Commission File No. 1-27
Date: October 24, 2000
Except for the historical and present factual information contained
herein, the matters set forth in this filing, including statements as to the
expected benefits of the merger such as efficiencies, cost savings, market
profile and financial strength, and the competitive ability and position of the
combined company, and other statements identified by words such as "expects,"
"projects," "plans," and similar expressions are forward-looking statements
within the meaning of the "safe harbor" provisions of the Private Securities
Litigation Reform Act of 1995. These forward-looking statements are subject to
risks and uncertainties that may cause actual results to differ materially,
including the possibility that the anticipated benefits from the merger cannot
be fully realized, the possibility that costs or difficulties related to the
integration of our businesses will be greater than expected, the impact of
competition and other risk factors relating to our industry as detailed from
time to time in each of Chevron's and Texaco's reports filed with the SEC.
Chevron and Texaco disclaim any responsibility to update these forward-looking
statements.
Chevron and Texaco will file a proxy statement/prospectus and other
relevant documents concerning the proposed merger transaction with the SEC.
Investors are urged to read the proxy statement/prospectus when it becomes
available and any other relevant documents filed with the SEC because they will
contain important information. You will be able to obtain the documents free of
charge at the website maintained by the SEC at www.sec.gov. In addition, you may
obtain documents filed with the SEC by Chevron free of charge by requesting them
in writing from Chevron Corporation, 575 Market Street, San Francisco, CA 94105,
Attention: Corporate Secretary, or by telephone at (415) 894-7700. You may
obtain documents filed with the SEC by Texaco free of charge by requesting them
in writing from Texaco Inc., 2000 Westchester Avenue, White Plains, New York
10650, Attention: Secretary, or by telephone at (914) 253-4000.
Chevron and Texaco, and their respective directors and executive
officers, may be deemed to be participants in the solicitation of proxies from
the stockholders of Chevron and Texaco in connection with the merger.
Information about the directors and executive officers of Chevron and their
ownership of Chevron stock is set forth in the proxy statement for Chevron's
2000 annual meeting of stockholders. Information about the directors and
executive officers of Texaco and their ownership of Texaco stock is set forth in
the proxy statement for Texaco's 2000 annual meeting of stockholders. Investors
may obtain additional information regarding the interests of such participants
by reading the proxy statement/prospectus when it becomes available.
* * *
<PAGE>
[Transcript of D.J. O'Reilly Employee Webcast - October 24, 2000]
Oct. 24, 2000, Merger Update:
O'Reilly Webcast for Employees
------------------------------
Hello. It's been a week since we announced the merger with Texaco, and I thought
I'd spend some time communicating with you directly. I had a chance to send a
letter over the email system last week, but other than that, I've been flat out
ever since then, between trips to New York, Boston and Washington. So, this is
my first time to get back to you on the screen like this, using the Web
technology; and I'm glad to be back home.
Let me start by just saying how enthusiastic I am about this proposed merger.
It's going to be great for Chevron. It'll make us a much bigger and stronger
company with the competitive base to be able to operate for the long term. I
think it's good for our shareholders; it's obviously good for our customers and
for you and for me as employees. We have a long-term stake in the company's
future, and this will position us well to be big, strong, competitive and to
compete with those supermajors. So, I'm very, very excited about this. I'm
looking forward to implementing it rapidly, once we get regulatory approval.
I thought I'd spend a few minutes telling you about what's happened during the
last week.
I started my week in New York. Many of you have, I think, had a chance to watch
the Analysts presentation and to listen to the press questions and how we
responded to those. It's still on the Web; you can get into the merger Web site
and follow along, if you have missed it by any chance, and get caught up on many
of the very strong points about our merger and on many of the questions that the
press have asked and how we responded to those. So, there's a lot of information
on the Web site, and I encourage you to keep clicking on it to follow through
the presentations and learn more about the strengths of this new company.
The second day, Tuesday, we went to Boston and visited with many of our big
shareholders. They were very positive meetings; we communicated why we were
doing this merger and answered their questions. They're very important, because
many of them hold a substantial interest not only in Chevron but also in Texaco.
On Wednesday, we went to Washington, spent some time with some of the key
lawmakers and again communicated the message about the strength of this new
company that we're forming and found that the reaction was pretty good. So, all
in all, it's been a very busy week, and I'm glad to be back.
I've been very impressed by the responses that we received from many, many of
the different interested parties. And I thought I'd share some of the reactions,
first of all, beginning with Wall Street.
Wall Street has analysts who look at companies and make recommendations about
whether or not people should buy their shares. So it's very important that they
have a positive initial reaction; and certainly, they seem to have had a
positive initial reaction. Let me quote from a few of the obvious ones that you
might like to hear about.
One analyst said, "The merger is a win/win situation." Another one said,
"Chevron/Texaco will be the perfect merger." Yet another one said, "We believe
the most compelling positive is the new company's access to large, low-cost,
international oil and gas reserves. Following the merger, the new combined
company will control significant exposure to all five of the most important oil
provinces in the world." And another one -- I thought a very thoughtful one --
had a very, very positive view. He said, "The new combined company could
position itself as the new partner of choice in the energy world, not only with
superb financial strength and excellent technical skills, but also the
flexibility and willingness to listen to and accommodate its host countries and
partners across the globe."
The "partner of choice" theme is so important to our success around the world.
Now, the media, too, seemed to get the message.
The Wall Street Journal has said, "Texaco brings considerable potential for oil
and gas production to Chevron, which is already a force on the world stage." The
London Financial Times said, "The prospect of bigger companies may alarm some,
but most new finds are likely to be in rough seas or remote terrain where big
oil has the best chance for success."
<PAGE>
One of the most thoughtful comments came from Dan Yergin. He was the author of
The Prize and heads up a consulting firm in Boston. His opinion article in the
Wall Street Journal last week said that "the Texaco/Chevron merger is aimed at
bringing down costs and assuring sufficient size to take on major, long-term
projects." He sees this as "... evidence of a healthy energy industry, one that
is vigorously responding to today's challenges, including the current high oil
prices and worry about another energy crisis."
So, overall, I think the press had very positive comments. Naturally, they
raised some issues that we need to resolve; but overall, I think they viewed it
in a very positive manner.
It was also important that the government respond positively -- or at least, not
negatively. And we got many positive and supportive comments from government
officials; certainly, at the least, they were willing to take a wait-and-see
attitude.
One of the quotes that I think helped us a lot was from U.S. Secretary, Bill
Richardson -- Secretary of Energy. He said, "My initial view is positive. These
are two solid companies; this is one of the inevitable outgrowths of the global
economy." So that has been very helpful as well, as well as many of the other
positive comments that we received.
Now, most important of all, though -- and of most interest to me -- have been
the comments that have come from you, the Chevron employees. I've been flooded
with emails; there have been many, many positive comments, and I sense there's a
lot of enthusiasm and support for this merger. Let me give you a couple of
examples.
Here's a note from a supervisor at El Segundo. "As a 20-year-plus employee, I
would like to thank you for all the hard work involved in the Chevron/Texaco
merger. It's good to see Chevron stepping up and making something good happen
for our employees and our investors." Here's another one, from somebody in
Chevron Overseas Petroleum Inc.: "As I move around Chevron Park today, I noticed
more smiles and a more upbeat tone. With today's announcement, our future as a
corporation is brighter than ever, and employees are reacting positively." So
I'm very appreciative of those comments. I think it's great to get that sort of
response from our employees. Now, many of you are asking what can you do to
help, and I appreciate those offers of help. We're putting together a merger
integration team -- John Watson of Chevron will lead the effort from our side,
and his counterpart from Texaco will lead from the Texaco side. They've got a
lot of work to do.
First of all, we've got to begin with filing the regulatory papers not only in
the United States but also in Canada and Europe and in many other countries
around the world. So, getting the regulatory approval will probably take some
time; typically, in transactions like this, it takes at least six months and can
take up to 12 months, based on what we've seen happen in other, similar mergers.
So, there will be a time lag here; however, in parallel with that, we need to
plan and prepare for the merger itself.
There'll be a lot of planning work that goes on, involving Chevron people
working with their counterparts from Texaco. And I can promise you, as we go
through this period of time, we will communicate, communicate, communicate so
that you know -- all of you know -- what's going on and what's going to be
coming next.
But I think the most important message is that, in the really near term, nothing
is going to be different for most of us. Most of us need to stay focused on our
jobs. We need to stay focused on getting the work done in a safe, reliable and
efficient manner. Many of you were involved in meetings around The Chevron Way
and the Strategic Plan; we're in the middle of that deployment right now, and
that effort should continue. It is so critical that we understand and commit
together to, first of all, operational excellence -- safe, reliable and
efficient operations. Secondly, to continue to work on cost reduction, which is
so critical for our long-term competitiveness. Thirdly, to continue to work on
capital stewardship. We are continuing our capital programs; we continue to have
projects that we are working on. It's important that we make good decisions
about those projects and then that we execute those projects well.
And finally, we need to continue on our profitable growth track. We have many
opportunities to continue to grow around the company, and it's important that we
pursue those vigorously and not allow ourselves to get distracted by prospects
of this merger, which will even make us stronger, but will only make us stronger
if we don't lose the momentum that we're gaining from the work we're doing
today.
<PAGE>
Finally, organizational capability -- continuing to work together as a team of
people with skills, with the sharing, the learning, the teamwork that's so
critical to our success -- building organizational capability, building our
skill levels, getting better and better at delivering on our plans, is so
important. It drives all of the other four; it is truly the "+1" of the "4+1."
I'm confident that we will be successful in moving ahead with this merger; I'm
confident that we'll make Chevron stronger for the long term; and I'm confident
in you -- all of you -- because I know that together, if we stay focused, we can
be successful, we can be strong. It will be good for our shareholders; it will
be good for our customers; it will be good for America, for the rest of the
world, and particularly good for all of us as Chevron employees.
I thank you for your support, and I look forward to giving you updates as we
move forward. Thanks again, and stay focused.
--------------------------------------------------------------------------------
Private Securities Litigation Reform Act Safe Harbor Statement
-----------------------------------------------------------------
Except for the historical and present factual information contained herein, the
matters set forth above, including statements as to the expected benefits of the
merger such as efficiencies, cost savings, market profile and financial
strength, and the competitive ability and position of the combined company, and
other statements identified by words such as "expects," "projects," "plans," and
similar expressions are forward-looking statements within the meaning of the
"safe harbor" provisions of the Private Securities Litigation Reform Act of
1995. These forward-looking statements are subject to risks and uncertainties
that may cause actual results to differ materially, including the possibility
that the anticipated benefits from the merger cannot be fully realized, the
possibility that costs or difficulties related to the integration of our
businesses will be greater than expected, the impact of competition and other
risk factors relating to our industry as detailed from time to time in each of
Chevron's and Texaco's reports filed with the SEC. Chevron and Texaco disclaim
any responsibility to update these forward-looking statements.
Additional Information
----------------------
Chevron and Texaco will file a proxy statement/prospectus and other relevant
documents concerning the proposed merger transaction with the SEC. Investors are
urged to read the proxy statement/prospectus when it becomes available and any
other relevant documents filed with the SEC because they will contain important
information. You will be able to obtain the documents free of charge at the
website maintained by the SEC at www.sec.gov. In addition, you may obtain
documents filed with the SEC by Chevron free of charge by requesting them in
writing from Chevron Corporation, 575 Market Street, San Francisco, CA 94105,
Attention: Corporate Secretary, or by telephone at (415) 894-7700. You may
obtain documents filed with the SEC by Texaco free of charge by requesting them
in writing from Texaco Inc., 2000 Westchester Avenue, White Plains, New York
10650, Attention: Secretary, or by telephone at (914) 253-4000.
Chevron and Texaco, and their respective directors and executive officers, may
be deemed to be participants in the solicitation of proxies from the
stockholders of Chevron and Texaco in connection with the merger. Information
about the directors and executive officers of Chevron and their ownership of
Chevron stock is set forth in the proxy statement for Chevron's 2000 Annual
Meeting of stockholders. Information about the directors and executive officers
of Texaco and their ownership of Texaco stock is set forth in the proxy
statement for Texaco's 2000 Annual Meeting of stockholders. Investors may obtain
additional information regarding the interests of such participants by reading
the proxy statement / prospectus when it becomes available.
Investors should read the proxy statement/prospectus carefully when it becomes
available before making any voting or investment decisions.
# # #
