Index

About Savings Plan

Participating in the Savings Plan

Savings Plan Account

Investment Options

Investment Considerations

Implementing Investment Decisions

Changing How Your Money Is Invested

Accessing Your Money

Loans

Withdrawals

Distributions

Information for Participants Who Worked for Mobil Corporation

Information for Participants Who Worked for Paxon or AES

Tax Considerations

Administrative and ERISA Information

Securities and Exchange Commission (SEC) Information

Key Terms

Savings Plan Account Features

Your Contributions and the Company Match

Q. When I enroll in the Savings Plan, what decisions do I need to make?

A. There are three primary decisions you must make when you enroll in the Savings Plan:

1. How much do you want to contribute?
2. Do you want your contributions to be on a before-tax and/or an after-tax basis?
3. How do you want to invest your contributions and the company match? Additional investment decision information is described later in this SPD beginning on page 21.

Deciding How Much You Want to Contribute

The Savings Plan is voluntary. You decide whether you want your contributions to be made on a before-tax and/or an after-tax basis. Listed below are the types of contributions that you may make to the Savings Plan. There are certain limitations on these contributions that may apply to you (see page 13).

• To participate, you must contribute a minimum of 6% of your pay to the Savings Plan by payroll deduction. This is called your minimum contribution. The company matches only your minimum contribution with 7% of your pay.
• Beyond your minimum contribution, you may make additional contributions by payroll deduction in 1% increments, for a combined total up to 20% of pay (10% of pay for Puerto Rico residents).
• You also may make contributions to your After-Tax Account other than through payroll deductions. These are called After-Tax Account special contributions and are made by check.
• Participants who are age 50 or older in a given calendar year and who maximize their before-tax contributions may make catch-up contributions to the Before-Tax Account.

Rollovers

Participants may make rollover contributions directly from another eligible plan into the Savings Plan. An eligible plan includes:

• A tax qualified plan such as a 401(k) plan, profit-sharing plan, and a defined benefit plan.
• A section 403(a) annuity plan.
• A section 403(b) tax-sheltered annuity.
• An eligible 457(b) plan maintained by a government employer.

Rollovers are accepted only in the form of cash from other eligible plans. Rollover amounts include only the tax-deferred portion of plan assets that is eligible for rollover treatment. After-tax contributions and amounts held in Individual Retirement Accounts (IRAs) are not eligible for rollover into the Savings Plan. By law, there are strict time limits and rules applicable to rollover contributions. Some things to consider:

• Rollover contributions are placed in your General Account.
• Rollover contributions are fully vested immediately upon acceptance into the Savings Plan.
• Rollover contributions are not eligible for withdrawal once in the Savings Plan.

Before-Tax vs. After-Tax Contributions

You must decide whether your contributions are made on a before-tax or an after-tax basis, or a combination of both. When you make before-tax contributions, your taxable income is reduced and, as a result, you pay less taxes in that year.

Example:
Suppose your annual pay is $40,000 and you contribute 6% of your pay (or $2,400). This example shows a comparison of contributing before-tax vs. after-tax:

*Taxes for this example assume a simple, flat federal income tax rate of 15% and do not include state or local taxes. Your tax savings will depend on your personal financial situation.

As the example above shows, you contribute the same amount (in this example, $2,400) whether you make before-tax or after-tax contributions. But contributing before-tax dollars reduces your current federal income taxes by $360. That means you have $360 more in after-tax pay.

While contributions to the Before-Tax Account may provide current tax advantages, you cannot make any withdrawals from your Before-Tax Account other than hardship withdrawals. Contributions to the After-Tax Account, however, are eligible for withdrawals. Withdrawals are discussed beginning on page 34.

Remember: these taxes are only deferred. When you receive a withdrawal or distribution of your tax-deferred contributions or earnings, they generally will be subject to taxes. Before-tax contributions do not reduce your current Social Security or Medicare taxes. A discussion of additional tax considerations begins on page 47.

You may also be eligible to receive an income tax credit for making before-tax contributions, if your adjusted gross income does not exceed certain limits (for 2008, $26,500 for single filers, $39,750 for heads of household, or $53,000 for married persons filing jointly). The amount of the credit ranges from 10% to 50% of your contribution, up to the first $2,000 of before-tax contributions, depending on your adjusted gross income.

The Company Match

When you make at least the minimum contribution of 6% of pay, you automatically receive a company match of 7% of pay. 

How You Become Vested

Vesting means ownership. When you leave the company, you are entitled to receive a distribution of the vested portion of your Savings Plan account:

• Your contributions and any earnings – You always are vested in your own contributions to the Savings Plan and in any investment earnings in your Savings Plan account.
• Company match – As an employee, you vest in the company match upon the earliest of the following events:
  • Completion of three years of vesting service (Vesting service is defined in Key Terms on page 67).
  • Reaching age 65.
  • Your death.

If you leave the company before you are vested, you forfeit (lose) the company match in your General and Stock Match Accounts, but not the earnings on the company match.

Changing Your Payroll Contributions and Company Match

You may change the percent of your payroll contributions at any time. 

Any change in how you direct your contributions and company match will be effective at the beginning of the next payroll period after your request is processed. There is no limit on how often you may make such changes.

Suspending Your Payroll Contributions

You may suspend your payroll contributions at any time. However, if you suspend your minimum contributions voluntarily, you will not be able to recommence making contributions by payroll deduction for six months.

Your payroll contributions also may be suspended as a penalty for making certain withdrawals.

While your contributions are suspended, no company match is made to your General Account.

Limits on Contributions

Federal law and Savings Plan provisions limit the amounts you and the company can contribute annually to the Savings Plan. These limits may be adjusted periodically. The following summarizes these limitations for 2008:

• Percentage-of-Pay and Dollar Limits – Your contributions plus the company's contributions during a calendar year cannot exceed the lesser of 27% of your pay or $46,000. Both of these limits exclude catch-up contributions.
• Before-Tax Contributions Limit – The limit is $15,500. 
• Catch-up Contributions Limit – The limit is $5,000.
• Further Limits – Federal law further limits the amount that may be contributed (and the company can match) to the Savings Plan accounts of certain higher-paid employees. If you are affected, you will be notified.

Limits may vary for Puerto Rico residents.

The Savings Plan Web site at http://xomsavings.ingplans.com and the Savings Telephone Service (STS) at 877-966-4015 are available for account information and transactions.