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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C.
SCHEDULE 14A INFORMATION
PROXY STATEMENT PURSUANT TO SECTION 14(a) OF THE SECURITIES
EXCHANGE ACT OF 1934 (AMENDMENT NO. )
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Rule14a-6(e)(2))
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EL PASO CORPORATION
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NEWS [LOGO - EL PASO]
For Immediate Release
EL PASO CORPORATION URGES SHAREHOLDERS TO CONSIDER ZILKHA/WYATT THREAT TO
DERAIL WESTERN ENERGY SETTLEMENT
HOUSTON, TEXAS, JUNE 11, 2003--El Paso Corporation (NYSE: EP) said today
that recent remarks by Selim Zilkha, Oscar Wyatt and Stephen Chesebro'
magnify concerns that they may derail El Paso's settlement concerning
litigation surrounding the Western energy crisis if the Zilkha/Wyatt
nominees are elected at El Paso's upcoming Annual Meeting.
On June 9, Zilkha/Wyatt issued a news release purporting to clarify their
position on this crucial issue. Instead of clarification, Zilkha/Wyatt
further confused the issue by denying that they would disrupt El Paso's
California settlement, while in the same press release and in media
interviews reconfirming that, if elected, they would re-open the
settlement.
Here is what Zilkha, Wyatt and Chesebro' have said about the settlement:
o "Unfathomable" and "unconscionable." "[W]e'll have to see where
it is at the time."
Stephen Chesebro', June 4, 20031
o The Zilkha/Wyatt slate would "need to take a good look at" the
settlement.
Selim Zilkha, June 9, 20032
o A settlement of the California claims for $200 million would have
been "reasonable;" and
o "The [Zilkha/Wyatt slate] would have to [review the settlement].
No one could prudently accept what this board has done." Oscar
Wyatt, June 9, 20033
o "El Paso says, well, we had to settle this to give stability to
our pricing. That's right, but I would not give away $1.7 billion
just for a little stock market hit, especially before a proxy
fight." Stephen Chesebro', June 10, 20034
Far from reassuring investors, Zilkha/Wyatt's latest comments regarding the
California settlement underscore the fact that Zilkha/Wyatt are not
committed to a settlement that is the product of months of negotiations
with dozens of private and public litigants including the attorneys general
of California, Oregon, Nevada and Washington. Zilkha/Wyatt's continued
insistence on re-opening a settlement that is critical to the future of El
Paso, combined with their uninformed and irresponsible comments about the
terms of the settlement, demonstrate their fundamental lack of
understanding about the issues surrounding the Western energy crisis and
the risks and uncertainties that would ensue were this settlement not
completed.
El Paso continues to believe--and we believe analysts and shareholders
agree--that this settlement is a positive for all stakeholders in El Paso
and will put this issue behind us, allowing management to focus on the
company's future.
A report issued by Glass, Lewis & Co., LLC, an independent proxy voting and
corporate governance advisory firm on June 9, 2003 noted:
"From our standpoint, the Company's progress in settling with FERC has
been an extremely positive development. Similarly, a review of the
transcript of the Company's March 21, 2003, conference call regarding
the settlement suggests that the analyst community feels the same
way."
"Recent comments from Stephen Chesebro', the dissidents' proposed CEO,
suggest that the dissidents may not feel compelled to adhere to the
terms of the recent settlement of the FERC charges stemming from the
Western States energy crisis."
"Since the litigation settlement is only an agreement in principle,
comments such as [Chesebro's] risk undermining the Company's ability
to complete the final agreements. Reintroducing any uncertainty
concerning the liability associated with the settlement only harms
shareholders and dampens their ability to value the Company and the
stock accurately."
SHAREHOLDERS WHO WANT TO SEE THIS IMPORTANT SETTLEMENT COMPLETED SHOULD
SIGN THE WHITE PROXY CARD TO SUPPORT EL PASO'S NOMINEES.
The Board of Directors urges El Paso shareholders to vote FOR the election
of El Paso's slate of 12 highly qualified directors on El Paso's WHITE
proxy card, NOT sign the blue proxy card sent to you by Messrs. Zilkha and
Wyatt and DISCARD any blue proxy card they may send to you in the future.
Your vote is critical, no matter how many shares you own. Time is short as
the June 17 Annual Meeting is rapidly approaching.
As previously noted, in its June 9 proxy report, Glass, Lewis & Co., LLC
recommended against the election of the Zilkha/Wyatt nominees, concluding
that "introducing an entirely new Board to `re-start' the existing
initiatives seems unwise; it adds substantial risk...without obvious
benefit." Although we previously expressed a belief about the potential
impact of Institutional Shareholder Services' report on shareholders of El
Paso, we cannot predict the effect that either the Glass Lewis or the ISS
reports will have on shareholders' voting decisions.
El Paso shareholders who have any questions about voting your proxy or need
additional information about El Paso or the stockholders meeting, please
contact MacKenzie Partners, Inc. at (800) 322-2885 or visit El Paso's Web
site at www.elpaso.com.
El Paso Corporation is the leading provider of natural gas services and the
largest pipeline company in North America. The company has core businesses
in pipelines, production, and midstream services. Rich in assets, El Paso
is committed to developing and delivering new energy supplies and to
meeting the growing demand for new energy infrastructure. For more
information, visit www.elpaso.com.
1 Stephen Chesebro', Investor Meeting, 6/4/03
2 "Zilkha Criticizes El Paso for Resorting to 'Fear Factor' by Lying About
Nominees' Comments on El Paso's California Settlement." Press Release, 6/9/03
3 "El Paso proxy battle enters final stage." CBSMarketwatch.com, 6/9/03
4 Stephen Chesebro', Interview, KRIV-TV (Fox), 6/9/03
CAUTIONARY STATEMENT REGARDING FORWARD-LOOKING STATEMENTS
This release includes forward-looking statements and projections, made in
reliance on the safe harbor provisions of the Private Securities Litigation
Reform Act of 1995. The company has made every reasonable effort to ensure
that the information and assumptions on which these statements and
projections are based are current, reasonable, and complete. However, a
variety of factors could cause actual results to differ materially from the
projections, anticipated results or other expectations expressed in this
release, including, without limitation, our ability to attract and retain
qualified members of the Board of Directors; the successful recruitment and
retention of a qualified CEO; the successful implementation of the 2003
operational and financial plan; the successful implementation of the
settlement related to the Western Energy Crisis; material and adverse
impacts from our proxy contest with Selim Zilkha/Oscar Wyatt; actions by
the credit rating agencies; the successful close of financing transactions;
our ability to successfully exit the energy trading business; our ability
to divest of certain non-core assets; changes in commodity prices for oil,
natural gas, and power; general economic and weather conditions in
geographic regions or markets served by El Paso Corporation and its
affiliates, or where operations of the company and its affiliates are
located; the uncertainties associated with governmental regulation;
political and currency risks associated with international operations of
the company and its affiliates; inability to realize anticipated synergies
and cost savings associated with restructurings and divestitures on a
timely basis; difficulty in integration of the operations of previously
acquired companies, competition, and other factors described in the
company's (and its affiliates') Securities and Exchange Commission filings.
While the company makes these statements and projections in good faith,
neither the company nor its management can guarantee that anticipated
future results will be achieved. Reference must be made to those filings
for additional important factors that may affect actual results. The
company assumes no obligation to publicly update or revise any
forward-looking statements made herein or any other forward-looking
statements made by the company, whether as a result of new information,
future events, or otherwise.
ADDITIONAL IMPORTANT INFORMATION
To the extent that published materials are quoted in this press release, El
Paso's has used reasonable efforts to verify the source and accuracy of the
quote. El Paso has not, however, sought or obtained the consent of the
quoted sources to the use of such quotes as proxy soliciting material. This
document may contain expressions of opinion and belief. Except as otherwise
expressly attributed to another individual or entity, these opinions and
beliefs are the opinions and beliefs of El Paso.
CONTACTS
Communications and Government Affairs
Norma F. Dunn, Senior Vice President
Office: (713) 420-3750
Fax: (713) 420-3632
Investor Relations
Bruce L. Connery, Vice President
Office: (713) 420-5855
Fax: (713) 420-4417
Alternate Contacts
Joele Frank/Dan Katcher
Office: (212) 355-4449
Fax: (212) 355-4554