Tillerson severing ties with Exxon, sets up trust fund

Secretary of State-designate Rex Tillerson has agreed to sever all ties with Exxon Mobil, putting deferred stock awards in an independently managed trust, the company he headed until last week said.

The agreement was reached in consultation with federal ethics regulators to comply with conflict of interest requirements, it said in a statement late Tuesday.

Under the arrangement reached with Exxon Mobil's board of directors, Tillerson will place the value of some two million company shares that he would have received over the next ten years in an independently managed trust.

He will give up $4.1 million in cash bonuses that had been scheduled to be paid out over the next three years, as well as other benefits.

"The net effect of the agreement is a reduction of approximately $7 million in compensation owed to Tillerson," the company said in a statement.

Additionally, Tillerson has committed to selling the more than 600,000 Exxon shares he currently owns.

The trust will not be permitted to hold Exxon stock, and Tillerson will be barred from working in the oil and gas industry for the next 10 years.

Tillerson, who was nominated last month to be President-elect Donald Trump's chief diplomat, retired December 31 after more than forty years at Exxon Mobil, the last ten years as CEO.

Although highly respected as a globe-trotting dealmaker for Exxon Mobil, Tillerson is regarded as a controversial choice as secretary of state because of his close relationship with Russian President Vladimir Putin.

He has also been criticized for deals struck on behalf of Exxon Mobil that were at odds with US foreign policy.