HOUSTON–(BUSINESS WIRE)–Phillips 66 (NYSE: PSX) today announced that it has filed its preliminary proxy materials with the U.S. Securities and Exchange Commission in connection with its upcoming 2025 Annual Meeting of Shareholders.
In today’s filing, the Phillips 66 Board of Directors:
- Announces the nomination of two new candidates bringing critical financial and operational capabilities to the Board: A. Nigel Hearne, a 35-year veteran of the energy industry with direct refining operations leadership, bringing deep downstream and integration expertise; and Howard I. Ungerleider, a highly strategic former President and Chief Financial Officer with extensive chemicals experience.
- Nominates John E. Lowe and Robert “Bob” W. Pease as directors: Lowe, a strategic leader with more than 40 years of leadership in midstream, refining and chemicals businesses; and Pease, a director identified in partnership with Elliott Investment Management (“Elliott”), whose expertise in refining operations strengthens the Board’s oversight of efficiency improvements and strategic execution.
- Announces it again intends to seek shareholder approval of a management proposal to approve the declassification of the Board at the 2025 Annual Meeting, a proposal that the Company has previously put forth five times over the past decade.
- Reiterates unanimous support for the Company’s strategy to drive compelling, consistent returns for shareholders through operational excellence and effective allocation of capital across a leading integrated downstream business with a differentiated portfolio in highly attractive markets.
- Unanimously recommends that shareholders use the WHITE proxy card or the WHITE voting instruction form to vote FOR only the four nominees recommended by the Board, and AGAINST Elliott’s proposal to approve, on an advisory basis, that the Board adopt a policy to implement the required annual resignation of all directors, and as the Board recommends on all other proposals.
Glenn F. Tilton, the Board’s lead independent director, said, “As a board, we regularly evaluate all ideas that may maximize shareholder value and have a proven history of acting decisively on value enhancing opportunities when it is in the best interests of our shareholders. Our priority is ensuring we have the right mix of skills so that we are best positioned to oversee the Company’s strategy and to deliver consistent and long-term value for our shareholders. The Board encourages new perspectives, welcomes debate and regularly engages with shareholders to solicit their feedback.”
Tilton continued, “After careful consideration of Elliott’s nominees and several conversations with Elliott’s representatives over multiple years, we have determined that the dissident nominees do not possess skills or experiences not represented on the Board already or that would directly drive further shareholder value creation. Further, Elliott’s inconsistent approach and evolving demands would introduce undue risk by prioritizing uncertain short-term gains over a disciplined, long-term strategy. The Board reiterates its commitment to rigorously evaluating the portfolio and strategic alternatives to maximize long-term shareholder value while avoiding decisions driven by short-term market fluctuations and speculative valuations.”
Phillips 66 Nominates Proven Leaders Who Strengthen Highly Engaged Board
Over the past four years, Phillips 66 has welcomed five new independent directors to the Board, including two in 2024. Today, Phillips 66 is nominating four director candidates, including two new nominees:
- A. Nigel Hearne: With more than 35 years of experience in the energy industry, including extensive international upstream and downstream operating experience, he is a proven leader who will provide extremely valuable insights in overseeing Phillips 66’s execution of its strategic priorities. Hearne is currently the Chief Operating Officer of Harbour Energy and was recently Executive Vice President of Oil, Products & Gas at Chevron Corporation where he oversaw the entire value chain and was responsible for maximizing value from their global integrated model. He began his career in downstream operations, overseeing refineries in the United States and globally.
- Howard I. Ungerleider: An experienced public company board member, Ungerleider is a highly strategic former President and Chief Financial Officer with deep insight into the chemicals business. He served in leadership roles at Dow for more than 30 years and managed the financial complexities of the historic merge-and-spin of DowDuPont, an $86 billion holding company comprised of The Dow Chemical Company and DuPont, from September 2017 to April 2019. His financial expertise and broader leadership through strategic transformations will be a meaningful addition to the Board and its oversight of the Company’s strategy.
- John E. Lowe: As a respected strategic leader in the energy industry, he brings extensive expertise from an over 40-year career with leadership positions across midstream, refining, upstream and chemicals businesses. Through his various roles as an executive, strategic advisor and board member for upstream, midstream and downstream energy companies, he provides valuable insights into strategic, operational and regulatory considerations for Phillips 66’s strategic transformation and overall strategy.
- Robert W. Pease: Through his 38-year career in the energy industry, he has held numerous leadership roles, particularly in downstream businesses. He brings deep refinery operations experience to the Board, which bolsters the Board’s ability to oversee the Company’s focus on optimizing the cost structure and operational efficiency of its refining assets, along with valuable perspectives on shifting market demand and through-cycle positioning which are important for the Company to set its long-term strategy.
“The addition of Nigel and Howard will add fresh insights from proven global leaders who not only have direct experience in our industry – they notably bring unique perspectives from their careers that are highly relevant to our position in the industry and our long-term strategy,” said Tilton. “Together, Nigel, Howard, Bob and John represent a unique set of skills and experiences. Nigel and Howard’s skills will complement those of our existing directors and can challenge our strategy and represent what is best for our shareholders,” Tilton added.
Tilton concluded, “Our transformative strategy is in its early stages, and we are confident we have the right chief executive officer, leadership team and strategic plan in place to continue delivering sustainable value creation, as noted last year by one of our largest shareholders, Elliott Management. The Board takes a highly engaged approach to overseeing the Company’s strategy that involves thoughtfully reviewing operations and challenging management to further maximize long-term shareholder value.”
Phillips 66’s Board of Directors is Committed to Declassification
At the 2025 Annual Meeting, Phillips 66 is seeking shareholder approval of a proposal to approve the declassification of the Board by amending the Company’s certificate of incorporation and by-laws, as it has done five times before over the past decade. The Board continues to believe it is in the best interests of the Company and its shareholders to properly declassify the Board. Elliott is seeking shareholder approval of a request for the Board to adopt a policy to implement a required annual resignation of all directors. Elliott’s proposal is merely a distraction and contravenes several elements of the Company’s organizational documents, in violation of well-established principles of Delaware corporate law.
The Board strongly urges shareholders who wish to properly declassify the Board in accordance with the Company’s governing documents to vote AGAINST Elliott’s proposal and in support of management’s proposal.
Elliott’s Proxy Fight
As stated in the March 5 public letter to shareholders, Phillips 66 has sought to engage with Elliott since 2023 to hear its ideas and work constructively toward a shared goal of long-term value creation.
This constructive dialogue led to the addition of Bob Pease to the Board with Elliott stating: “We (Elliott) have worked collaboratively with Phillips 66 on the Board’s appointment of Bob, who will bring extensive experience in refining and the energy industry more broadly.”
However, attempts to reach agreement on adding another mutually agreed director have been met with challenges.
Following a period of silence, Elliott issued a series of public attacks on the Board and management team and, for the first time in its discussions with Phillips 66, proposed the idea of a separation. Phillips 66 sought to re-engage Elliott in constructive dialogue to find a path forward that would benefit all shareholders.
At the latest meeting, Elliott representatives indicated there were no immediate next steps and opted not to present their nominees for interviews at that time, despite the Board’s willingness to engage. The Board and leadership team of Phillips 66 stand ready to engage constructively when Elliott is ready.
In the coming weeks, Phillips 66 will provide more information about its highly qualified board candidates, its strong management team and its proven strategy to create long-term shareholder value. The Company will also provide details regarding how Elliott’s nominees and its proposed changes at Phillips 66 present significant risks to shareholder value.
Keeping Our Shareholders Informed
Phillips 66’s definitive proxy materials will soon be mailed out to shareholders and will include a WHITE proxy card or a WHITE voting instruction form with voting instructions. Your vote for all four Phillips 66 nominees on the WHITE proxy card or WHITE voting instruction form will be critical. Shareholders and other stakeholders can stay informed about the 2025 Annual Meeting and related updates by visiting: Phillips66Delivers.com.
Phillips 66 strongly urges shareholders to simply discard and NOT vote using any Gold proxy card or Gold voting instruction form that may be sent by Elliott.
About Phillips 66
Phillips 66 (NYSE: PSX) is a leading integrated downstream energy provider that manufactures, transports and markets products that drive the global economy. The company’s portfolio includes Midstream, Chemicals, Refining, Marketing and Specialties, and Renewable Fuels businesses. Headquartered in Houston, Phillips 66 has employees around the globe who are committed to safely and reliably providing energy and improving lives while pursuing a lower-carbon future. For more information, visit phillips66.com or follow @Phillips66Co on LinkedIn.
Forward-Looking Statements
This document contains forward-looking statements within the meaning of the federal securities laws relating to Phillips 66’s operations, strategy and performance. Words such as “anticipated,” “committed,” “estimated,” “expected,” “planned,” “scheduled,” “targeted,” “believe,” “continue,” “intend,” “will,” “would,” “objective,” “goal,” “project,” “efforts,” “strategies” and similar expressions that convey the prospective nature of events or outcomes generally indicate forward-looking statements. However, the absence of these words does not mean that a statement is not forward-looking. Forward-looking statements included in this news release are based on management’s expectations, estimates and projections as of the date they are made. These statements are not guarantees of future events or performance, and you should not unduly rely on them as they involve certain risks, uncertainties and assumptions that are difficult to predict. Therefore, actual outcomes and results may differ materially from what is expressed or forecast in such forward-looking statements. Factors that could cause actual results or events to differ materially from those described in the forward-looking statements include: changes in governmental policies or laws that relate to our operations, including regulations that seek to limit or restrict refining, marketing and midstream operations or regulate profits, pricing, or taxation of our products or feedstocks, or other regulations that restrict feedstock imports or product exports; our ability to timely obtain or maintain permits necessary for projects; fluctuations in NGL, crude oil, refined petroleum, renewable fuels and natural gas prices, and refining, marketing and petrochemical margins; the effects of any widespread public health crisis and its negative impact on commercial activity and demand for refined petroleum or renewable fuels products; changes to worldwide government policies relating to renewable fuels and greenhouse gas emissions that adversely affect programs including the renewable fuel standards program, low carbon fuel standards and tax credits for renewable fuels; potential liability from pending or future litigation; liability for remedial actions, including removal and reclamation obligations under existing or future environmental regulations; unexpected changes in costs for constructing, modifying or operating our facilities; our ability to successfully complete, or any material delay in the completion of, any asset disposition, acquisition, shutdown or conversion that we have announced or may pursue, including receipt of any necessary regulatory approvals or permits related thereto; unexpected difficulties in manufacturing, refining or transporting our products; the level and success of drilling and production volumes around our midstream assets; risks and uncertainties with respect to the actions of actual or potential competitive suppliers and transporters of refined petroleum products, renewable fuels or specialty products; lack of, or disruptions in, adequate and reliable transportation for our products; failure to complete construction of capital projects on time or within budget; our ability to comply with governmental regulations or make capital expenditures to maintain compliance with laws; limited access to capital or significantly higher cost of capital related to illiquidity or uncertainty in the domestic or international financial markets, which may also impact our ability to repurchase shares and declare and pay dividends; potential disruption of our operations due to accidents, weather events, including as a result of climate change, acts of terrorism or cyberattacks; general domestic and international economic and political developments, including armed hostilities (such as the Russia-Ukraine war), expropriation of assets, and other diplomatic developments; international monetary conditions and exchange controls; changes in estimates or projections used to assess fair value of intangible assets, goodwill and property and equipment and/or strategic decisions with respect to our asset portfolio that cause impairment charges; investments required, or reduced demand for products, as a result of environmental rules and regulations; changes in tax, environmental and other laws and regulations (including alternative energy mandates); political and societal concerns about climate change that could result in changes to our business or increase expenditures, including litigation-related expenses; the operation, financing and distribution decisions of equity affiliates we do not control; and other economic, business, competitive and/or regulatory factors affecting Phillips 66’s businesses generally as set forth in our filings with the Securities and Exchange Commission. Phillips 66 is under no obligation (and expressly disclaims any such obligation) to update or alter its forward-looking statements, whether as a result of new information, future events or otherwise.
Additional Information
On March 26, 2025, Phillips 66 filed a preliminary proxy statement on Schedule 14A (the “Proxy Statement”) and accompanying WHITE proxy card with the U.S. Securities and Exchange Commission (the “SEC”) in connection with its 2025 Annual Meeting of Shareholders (the “2025 Annual Meeting”) and its solicitation of proxies for Phillips 66’s director nominees and for other matters to be voted on. The Proxy Statement is in preliminary form and Phillips 66 intends to file and mail to shareholders of record entitled to vote at the 2025 Annual Meeting a definitive proxy statement and other documents, including a WHITE proxy card. Phillips 66 may also file other relevant documents with the SEC regarding its solicitation of proxies for the 2025 Annual Meeting. This communication is not a substitute for any proxy statement or other document that Phillips 66 has filed or may file with the SEC in connection with any solicitation by Phillips 66. PHILLIPS 66 SHAREHOLDERS ARE STRONGLY ENCOURAGED TO READ THE PROXY STATEMENT (AND ANY AMENDMENTS AND SUPPLEMENTS THERETO) AND ACCOMPANYING WHITE PROXY CARD AND ANY OTHER RELEVANT SOLICITATION MATERIALS FILED WITH THE SEC AS THEY CONTAIN IMPORTANT INFORMATION. Shareholders may obtain copies of the Proxy Statement, any amendments or supplements to the Proxy Statement and other documents (including the WHITE proxy card) filed by Phillips 66 with the SEC without charge from the SEC’s website at www.sec.gov. Copies of the documents filed by Phillips 66 with the SEC also may be obtained free of charge at Phillips 66’s investor relations website at https://investor.phillips66.com or upon written request sent to Phillips 66, 2331 CityWest Boulevard, Houston, TX 77042, Attention: Investor Relations.
Certain Information Regarding Participants
Phillips 66, its directors, its director nominees and certain of its executive officers and employees may be deemed to be participants in connection with the solicitation of proxies from Phillips 66 shareholders in connection with the matters to be considered at the 2025 Annual Meeting. Information regarding the names of such persons and their respective interests in Phillips 66, by securities holdings or otherwise, is available in the Proxy Statement, which was filed with the SEC on March 26, 2025, and will be included in Phillips 66’s definitive proxy statement, once available, including in the sections captioned “Beneficial Ownership of Phillips 66 Securities” and “Appendix C: Supplemental Information Regarding Participants in the Solicitation.” To the extent that Phillips 66’s directors and executive officers who may be deemed to be participants in the solicitation have acquired or disposed of securities holdings since the applicable “as of” date disclosed in the Proxy Statement, such transactions have been or will be reflected on Statements of Changes in Ownership of Securities on Form 4 or Initial Statements of Beneficial Ownership of Securities on Form 3 filed with the SEC. These documents are or will be available free of charge at the SEC’s website at www.sec.gov.
Contacts
Jeff Dietert (investors)
832-765-2297
[email protected]
Owen Simpson (investors)
832-765-2297
[email protected]
Thaddeus Herrick (media)
855-841-2368
[email protected]
