As Of               Filer                 Filing     As/For/On Docs:Pgs              Issuer               Agent

 4/02/08  Conocophillips                    DEF 14A     5/14/08    1:249                                    RR Donnelley/FA

Document/Exhibit                   Description                      Pages   Size 

 1: DEF 14A     Definitive Proxy Statement                          HTML  1,477K 

NOTICE OF

2008

ANNUAL STOCKHOLDERS MEETING

 

MAY 14, 2008

 

and

 

PROXY STATEMENT

 

Wednesday

May 14, 2008

9:30 a.m. local time

 

Omni Houston Hotel at Westside

13210 Katy Freeway

Houston, Texas 77079

 

April 2, 2008

 

Dear ConocoPhillips Stockholder:

 

On behalf of your board of directors and management, you are cordially invited to attend the Annual Meeting of Stockholders to be held at the Omni Houston Hotel at Westside, 13210 Katy Freeway, Houston, Texas, on Wednesday, May 14, 2008, at 9:30 a.m.

 

It is important that your shares be represented at the meeting. This proxy statement, the accompanying proxy card and the Company’s 2007 Annual Report to Stockholders are first being mailed and made available on the internet at www.proxyvote.com through the notice and access process to the Company’s stockholders on or about April 2, 2008. Whether or not you plan to attend the meeting, please either submit your proxy using the Internet or telephone procedures provided on the notice and access card or, if you have elected to receive a copy of your proxy card in the mail, complete and return the enclosed proxy card in the accompanying envelope. Please note that submitting a proxy using any one of these methods will not prevent you from attending the meeting and voting in person. You will find information regarding the matters to be voted on at the meeting in the proxy statement.

 

In addition to the formal items of business to be brought before the meeting, there will be a report on ConocoPhillips’ operations during 2007 followed by a question and answer period. Your interest in ConocoPhillips is appreciated. We look forward to seeing you on May 14^th.

 

Sincerely,
J. J. Mulva Chairman of the Board and Chief Executive Officer

Notice of 2008 Annual Meeting of Stockholders		1
About the Annual Meeting		2
Board of Directors Information		6
Election of Directors and Director Biographies (Proposal 1)		8
Proposed Annual Election of Directors (Proposal 2)		13
Corporate Governance Matters and Communications with the Board		14
Code of Business Ethics and Conduct		15
Related Party Transactions		15
Nominating Processes of the Committee on Directors’ Affairs		16
Role of the Compensation Committee		18
Compensation Committee Report		19
Compensation Discussion and Analysis		20
Stock Performance Graph		38
Executive Compensation Tables		39
Summary Compensation Table		39
Grants of Plan-Based Awards Table		44
Outstanding Equity Awards at Fiscal Year End		47
Option Exercises and Stock Vested		50
Pension Benefits		51
Nonqualified Deferred Compensation		55

Executive Severance and Changes in Control		57
Non-Employee Director Compensation		63
Equity Compensation Plan Information		70
Stock Ownership		71
Holdings of Major Stockholders		71
Securities Ownership of Officers and Directors		72
Section 16(a) Beneficial Ownership Reporting Compliance		73
Audit & Finance Committee Report		74
Proposal to Ratify the Appointment of Ernst & Young LLP (Proposal 3)		75
Stockholder Proposals (Proposals 4-12)		77
Solicitation by Board; Expenses of Solicitation		97
Submission of Future Stockholder Proposals		97
Available Information		97
Householding		97
Other Matters		98
Appendix A – Proposed Amendments to Restated Certificate of Incorporation		A-1
Appendix B – Proposed Amendments to Amended and Restated By-Laws		B-1

 About the Annual Meeting

 

Who is soliciting my vote?

 

The Board of Directors of ConocoPhillips is soliciting your vote at the Annual Meeting of ConocoPhillips’ stockholders.

 

What am I voting on?

 

You are voting on:

 

•

The election of three directors (see page 8);

 

•

A proposal to amend our Certificate of Incorporation and By-Laws to provide for the annual election of all members of the Board of Directors (see page 13);

 

•

The ratification of the appointment of Ernst & Young LLP as ConocoPhillips’ independent registered public accounting firm for 2008 (see page 75);

 

•

The consideration of 9 stockholder proposals (see pages 77 through 96); and

 

•

Any other business properly coming before the meeting.

 

How does the Board recommend that I vote my shares?

 

Unless you give other instructions on your proxy card, the persons named as proxy holders on the proxy card will vote in accordance with the recommendations of the Board of Directors. The Board’s recommendation can be found with the description of each item in this proxy statement. In summary, the Board recommends a vote:

 

•

FOR the Board’s proposal to elect nominated Directors;

 

•

FOR the Board’s proposal to amend our Certificate of Incorporation and By-Laws to provide for the annual election of all members of the Board of Directors;

 

•

FOR the Board’s proposal to ratify the appointment of Ernst & Young LLP as ConocoPhillips’ independent registered public accounting firm for 2008; and

 

 

 

 

•

AGAINST each of the stockholder proposals.

 

Who is entitled to vote?

 

You may vote if you were the record owner of ConocoPhillips common stock as of the close of business on March 17, 2008. Each share of common stock is entitled to one vote. As of March 17, 2008, we had 1,589,593,832 shares of common stock outstanding and entitled to vote. There is no cumulative voting.

 

How many votes must be present to hold the meeting?

 

Your shares are counted as present at the Annual Meeting if you attend the meeting and vote in person or if you properly return a proxy by Internet, telephone or mail. In order for us to hold our meeting, holders of a majority of our outstanding shares of common stock as of March 17, 2008, must be present in person or by proxy at the meeting. This is referred to as a quorum. Abstentions and broker non-votes will be counted for purposes of establishing a quorum at the meeting.

 

What is a broker non-vote?

 

If a broker does not have discretion to vote shares held in street name on a particular proposal and does not receive instructions from the beneficial owner on how to vote those shares, the broker may return the proxy card without voting on that proposal. This is known as a broker non-vote. Broker non-votes will have no effect on the vote for any matter properly introduced at the meeting.

 

How many votes are needed to approve each of the proposals?

 

The proposal to amend our Restated Certificate of Incorporation and Amended and Restated By-Laws to provide for the annual election of all members of the Board of Directors requires the affirmative “FOR” vote of 80% of the shares outstanding as of March 17, 2008.  All other proposals submitted and

each of the director nominees require the affirmative “FOR” vote of a majority of those shares present in person or represented by proxy at the meeting and entitled to vote on the proposal.

 

How do I vote?

 

You can vote either in person at the meeting or by proxy without attending the meeting.

 

This proxy statement, the accompanying proxy card and the Company’s 2007 Annual Report to Stockholders are being made available on the Internet at www.proxyvote.com through the notice and access process to the Company’s stockholders.

 

To vote by proxy, you must do one of the following:

 

•

Vote over the Internet (instructions are on the proxy card);

 

•

Vote by telephone (instructions are on the proxy card); or

 

•

If you elected to receive a hard copy of your proxy materials, fill out the enclosed proxy card, date and sign it, and return it in the enclosed postage-paid envelope.

 

If you hold your ConocoPhillips stock in a brokerage account (that is, in “street name”), your ability to vote by telephone or over the Internet depends on your broker’s voting process. Please follow the directions on your proxy card or voter instruction form carefully.

 

Even if you plan to attend the meeting, we encourage you to vote your shares by proxy. If you plan to vote in person at the Annual Meeting and you hold your ConocoPhillips stock in street name, you must obtain a proxy from your broker and bring that proxy to the meeting.

 

How do I vote if I hold my stock through ConocoPhillips’ employee benefit plans?

 

If you hold your stock through ConocoPhillips’ employee benefit plans, you must either:

 

•

Vote over the Internet (instructions are on the notice and access form);

 

•

Vote by telephone (instructions are on the notice and access form); or

 

•

If you received a hard copy of your proxy materials, fill out the enclosed voting instruction form, date and sign it, and return it in the enclosed postage-paid envelope.

 

You will receive a separate voting instruction form for each employee benefit plan in which you have an interest. Please pay close attention to the deadline for returning your voting instruction form to the plan trustee. The voting deadline for each plan is set forth on the voting instruction form. Please note that different plans may have different deadlines.

 

Can I change my vote?

 

Yes. You can change or revoke your vote at any time before the polls close at the Annual Meeting. You can do this by:

 

•

Voting again by telephone or over the Internet prior to 11:59 p.m. Eastern Daylight Time on May 13, 2008;

 

•

Signing another proxy card with a later date and returning it to us prior to the meeting;

 

•

Sending our Corporate Secretary a written document revoking your earlier proxy; or

 

•

Voting again at the meeting.

 

Who counts the votes?

 

We have hired Broadridge Financial Solutions, Inc. (formerly ADP), to count the votes represented by proxies cast by ballot, telephone, and the Internet. Employees of Broadridge will act as Inspectors of Election.

 

Will my shares be voted if I don’t provide my proxy and don’t attend the Annual Meeting?

 

If you do not provide a proxy or vote your shares held in your name, your shares will not be voted.

 

If you hold your shares in street name, your broker may be able to vote your shares for certain “routine”

matters even if you do not provide the broker with voting instructions. The election of directors, the proposal to amend our Certificate of Incorporation and By-Laws to provide for the annual election of all members of the Board of Directors, and the ratification of Ernst & Young LLP as our independent registered public accounting firm for 2008 are considered routine matters.

 

If you do not give your broker instructions on how to vote your shares, for matters not considered “routine,” the broker may return the proxy card without voting on that proposal. This is a broker non-vote. Votes in connection with the 9 stockholder proposals are not considered routine matters. The broker may not vote on the stockholder proposals absent instructions from you. Without your instructions, a broker non-vote will occur.

 

As more fully described on your proxy card, if you hold your shares through certain of ConocoPhillips’ employee benefit plans and do not vote your shares, your shares (along with all other shares in the plan for which votes are not cast) may be voted pro rata by the trustee in accordance with the votes directed by other participants in the plan who elect to act as a fiduciary entitled to direct the trustee of the applicable plan on how to vote the shares.

 

How are votes counted?

 

For all proposals, you may vote “FOR,” “AGAINST,” or “ABSTAIN.” If you “ABSTAIN,” it has the same effect as a vote “AGAINST.”

 

What if I return my proxy but don’t vote for some of the matters listed on my proxy card?

 

If you return a signed proxy card without indicating your vote, your shares will be voted “FOR” the director nominees listed on the card, “FOR” the proposal to amend our Certificate of Incorporation and By-Laws providing for the annual election of all members of the Board of Directors, “FOR” the ratification of Ernst & Young LLP as ConocoPhillips’ independent registered public accounting firm for 2008 and “AGAINST” each of the stockholder proposals.

 

Could other matters be decided at the Annual Meeting?

 

We are not aware of any other matters that will be considered at the Annual Meeting. If any other matters are properly brought before the Annual Meeting, the persons named in your proxies will vote in accordance with their best judgment.

 

Who can attend the meeting?

 

The Annual Meeting is open to all holders of ConocoPhillips common stock. Each stockholder is permitted to bring one guest. No cameras, recording equipment, large bags, briefcases or packages will be permitted in the Annual Meeting, and security measures will be in effect in order to ensure the safety of attendees.

 

Do I need a ticket to attend the Annual Meeting?

 

Yes, you will need an admission ticket or proof of ownership of ConocoPhillips stock to enter the meeting. If your shares are registered in your name, you will find an admission ticket attached to the proxy card sent to you. If your shares are in the name of your broker or bank or you received your materials electronically, you will need to bring evidence of your stock ownership, such as your most recent brokerage statement. All stockholders will be required to present valid picture identification. IF YOU DO NOT HAVE VALID PICTURE IDENTIFICATION AND EITHER AN ADMISSION TICKET OR PROOF THAT YOU OWN CONOCOPHILLIPS STOCK, YOU MAY NOT BE ADMITTED INTO THE MEETING.

 

How can I access ConocoPhillips’ proxy materials and annual report electronically?

 

This proxy statement, the accompanying proxy card and the Company’s Annual Report are being made available on the internet at www.proxyvote.com through the notice and access process to the Company’s stockholders. Most stockholders can elect to view future proxy statements and annual reports over the Internet instead of receiving paper copies in the mail.

If you own ConocoPhillips stock in your name, you can choose this option and save us the cost of producing and mailing these documents by checking the box for electronic delivery on your proxy card, or by following the instructions provided when you vote by telephone or over the Internet. If you hold your ConocoPhillips stock through a bank, broker or other holder of record, please refer to the information provided by that entity for instructions on how to elect to view future proxy statements and annual reports over the Internet.

 

If you choose to view future proxy statements and annual reports over the Internet, you will receive a Notice of Internet Availability next year containing the Internet address to use to access our proxy statement and annual report. Your choice will remain in effect unless you change your election following the receipt of a Notice of Internet Availability. You do not have to elect Internet access each year. If you later change your mind and would like to receive paper copies of our proxy statements and annual reports, you can request both by phone at (800) 579-1639, email at sendmaterial@proxyvote.com and through the internet at www.proxyvote.com. You will need your 12-digit control number located on your Notice of Internet Availability to request a package. You will also be provided with the opportunity to receive a copy of the proxy statement and annual report in future mailings.

 

If you do not elect electronic delivery of future proxy statements and annual reports, we may elect to post the proxy statement and annual report on an Internet site, which we are permitted to do under a new Securities and Exchange Commission rule, and we will send you a notice of the Internet posting.

 Board of Directors Information

 

What is the makeup of the Board of Directors and how often are the members elected?

 

Our Board of Directors currently has 17 members. Our Board is classified into three classes serving staggered three-year terms. Directors for each class are elected at the Annual Meeting of Stockholders held in the year in which the term for their class expires. Any director vacancies created between meetings (such as by a current director’s death, resignation or removal for cause or an increase in the number of directors) may be filled by a majority vote of the remaining directors then in office. Any director appointed in this manner would hold office until the next election for his or her respective class. If a vacancy resulted from an action of our stockholders, only our stockholders are entitled to elect a successor.

 

A proposal to declassify the Board and require the annual election of all directors is being submitted for your consideration and approval. Please see “Proposed Annual Election of Directors” beginning on page 13.

 

What if a nominee is unable or unwilling to serve?

 

That is not expected to occur. If it does, shares represented by proxies will be voted for a substitute nominated by the Board of Directors.

 

What if a director nominee does not receive a majority of votes cast?

 

If a nominee who is serving as a director is not elected at the annual meeting and no one else is elected in place of that director, then, under Delaware law, the director would continue to serve on the Board as a “holdover director.” However, under our By-Laws, the holdover director is required to tender his or her resignation to the Board. The Committee on Directors’ Affairs would then make a recommendation to the Board whether to accept or reject the tendered resignation, or whether some other action should be taken. The Board of Directors would then make a

decision whether to accept the resignation taking into account the recommendation of the Committee on Directors’ Affairs. The Board is required to publicly disclose (by a press release, a filing with the SEC or other broadly disseminated means of communication) its decision regarding the resignation and the rationale behind the decision within 90 days from the date of the certification of the election results.

 

How are directors compensated?

 

Please see our discussion of director compensation beginning on page 63.

 

How often did the Board meet in 2007?

 

The Board of Directors met eight times in 2007. Each director attended at least 75 percent of the aggregate of:

 

•

the total number of meetings of the Board (held during the period for which she or he has been a director); and

 

•

the total number of full-committee meetings held by all committees of the Board on which she or he served (during the periods that she or he served).

 

Do the Board committees have written charters?

 

Yes. The charters for our Audit and Finance Committee, Executive Committee, Compensation Committee, Committee on Directors’ Affairs and Public Policy Committee can be found on ConocoPhillips’ website at www.conocophillips.com under the “Corporate Governance” caption (accessed through the “Investor Information” link). Stockholders may also request printed copies of our Board committee charters by following the instructions located under the caption “Available Information” on page 97.

		Harold W. McGraw III, 59, Director since September 2005

•

Chairman, President and Chief Executive Officer of The McGraw-Hill Companies since 2000

•

President and Chief Executive Officer of The McGraw-Hill Companies 1998 to 2000

•

President and Chief Operating Officer of The McGraw-Hill Companies from 1993 to 1998

•

Member of the Board of:

•

The McGraw-Hill Companies

•

United Technologies Corporation

 

		James J. Mulva, 61, Director since August 2002

•

Chairman of the Board of ConocoPhillips since October 2004

•

President and Chief Executive Officer of ConocoPhillips since August 2002

•

Director of Phillips Petroleum Company from 1994 to 2002

•

Chairman of the Board of Directors and Chief Executive Officer of Phillips Petroleum Company from October 1999 to August 2002

•

Vice Chairman of the Board of Directors, President and Chief Executive Officer of Phillips Petroleum Company from June 1999 to October 1999

•

President and Chief Operating Officer of Phillips Petroleum Company from 1994 to June 1999

 

		Bobby S. Shackouls, 57, Director since March 2006

•

Chairman of the Board of Burlington Resources Inc. from July 1997 through March 2006

•

President and Chief Executive Officer of Burlington Resources Inc. from December 1995 through March 2006

•

Member of the Board of:

•

The Kroger Co.

 

What does the Board recommend?

 

THE BOARD RECOMMENDS THAT

YOU VOTE “FOR” THE ELECTION

OF THESE DIRECTORS

		Richard L. Armitage, 62, Director since March 2006

•

President, Armitage International LLC, since March 2005

•

U.S. Deputy Secretary of State from March 2001 to February 2005

•

President, Armitage Associates, a worldwide business and public policy firm, from 1993 to 2001.

•

A variety of high-ranking U.S. diplomatic positions from 1989 to 1993 including: Special Mediator for Water in the Middle East; Special Emissary to King Hussein of Jordan during the 1991 Gulf War; Ambassador, directing U.S. assistance to the newly independent states of the former Soviet Union.

•

Assistant U.S. Secretary of Defense for International Security Affairs from 1983 to 1989

•

Member of the Board of:

•

ManTech International Corporation

 

		Richard H. Auchinleck, 56, Director since August 2002

•

Director of Conoco Inc. from 2001 to 2002

•

President and Chief Executive Officer of Gulf Canada Resources Limited from February 1998 to June 2001

•

Chief Operating Officer of Gulf Canada from July 1997 to February 1998

•

Chief Executive Officer for Gulf Indonesia Resources Limited from September 1997 to February 1998

•

Member of the Board of:

•

Enbridge Commercial Trust

•

Telus Corporation

 

		Harald J. Norvik, 61, Director since July 2005

•

Chairman and Partner, Econ Management AS from June 2002 to present

•

Chairman, President & CEO of Statoil from January 1988 to October 1999

•

Chairman of the Board of Telenor ASA from May 2007 to present

•

Member of the Board of:

•

Petroleum Geo-Services ASA

 

		William K. Reilly, 68, Director since August 2002

•

Director of Conoco Inc. from 1998 to 2002

•

President and Chief Executive Officer of Aqua International Partners, an investment group which finances water improvements in developing countries, since June 1997

•

Former Administrator of the U.S. Environmental Protection Agency 1989 to 1993

•

Member of the Board of:

•

E. I. du Pont de Nemours & Company

•

Royal Caribbean Cruises Ltd.

		Victoria J. Tschinkel, 60, Director since August 2002

•

Director of Phillips Petroleum Company from 1993 to 2002

•

Director of Florida Nature Conservancy from January 2003 to January 2007

•

Senior Environmental Consultant to Landers & Parsons, a Tallahassee, Florida law firm, from 1987 to 2002

•

Secretary of the Florida Department of Environmental Regulation, from 1981 to 1987

•

Chairwoman of 1000 Friends of Florida

 

		Kathryn C. Turner, 60, Director since August 2002

•

Director of Phillips Petroleum Company from 1995 to 2002

•

Chairperson and Chief Executive Officer of Standard Technology, Inc., a management technology solutions firm she founded in 1985

•

Member of the Board of:

•

Carpenter Technology Corporation

•

Schering-Plough Corporation

		James E. Copeland, Jr., 63, Director since February 2004

•

Chief Executive Officer of Deloitte & Touche from 1999 to 2003

•

Senior Fellow for Corporate Governance with the U.S. Chamber of Commerce