Exhibit 10.1


OCCIDENTAL
PETROLEUM CORPORATION

2005 LONG-TERM INCENTIVE PLAN

PERFORMANCE-BASED RESTRICTED SHARE UNIT AWARD

TERMS AND CONDITIONS


 


	
  DATE OF GRANT:

  	
   

  	
  July 19, 2006

  
	
   

  	
   

  	
   

  
	
  TARGET PERFORMANCE-BASED

  RESTRICTED SHARE UNITS:

  	
   

  	
  See “Shares Granted/Awarded”

  (Grant Acknowledgment screen)

  
	
   

  	
   

  	
   

  
	
  PERFORMANCE PERIOD:

  	
   

  	
  July 19, 2006 through July 18, 2009

  



 


These Terms and Conditions
(these “Terms and Conditions”) are set forth as of the Date of Grant between
OCCIDENTAL PETROLEUM CORPORATION, a Delaware corporation (“Occidental”) and,
with its subsidiaries, (the “Company”), and Grantee.


1.             GRANT OF TARGET PERFORMANCE-BASED
RESTRICTED SHARE UNITS.  In
accordance with these Terms and Conditions and the Occidental Petroleum
Corporation 2005 Long-Term Incentive Plan, as the same may be amended from time
to time (the “Plan”), Occidental grants to the Grantee as of the Date of Grant
the right to receive in Common Shares up to 200% of the number of Target
Performance-Based Restricted Share Units. 
For the purposes of these Terms and Conditions, “Target
Performance-Based Restricted Share Units” means a bookkeeping entry that
records the equivalent of Common Shares awarded pursuant to Section 4.2 of the
Plan that is payable upon the achievement of the Performance Goals.  Target Performance-Based Restricted Share
Units are not Common Shares and have no voting rights or, except as stated in
Section 6, dividend rights.


2.             RESTRICTIONS ON TRANSFER.  Neither these Terms and Conditions nor any
right to receive Common Shares or 
dividend equivalents in the form of cash pursuant to these Terms and
Conditions may be transferred or assigned by the Grantee other than (i) to a
beneficiary designated on a form approved by the Company (if permitted by local
law), by will or, if the Grantee dies without designating a beneficiary, by the
laws of descent and distribution, or (ii) pursuant to a domestic relations
order, if applicable, (if approved or ratified by the Administrator).


3.             PERFORMANCE GOALS.  The Performance Goal for the Performance
Period is based on the attainment of at least a minimum Return on Equity, as
set forth on Exhibit 1.  Return on Equity
for the purposes of Exhibit 1 shall be calculated (i) for each quarter in the
three-year period ended June 30, 2009 by dividing the Company’s Net Income (as
defined in the Plan) for each such quarterly period by the stockholder equity
as of the end of such quarter, in each case as reported in the financial
statements of the Company and (ii) adding together the calculated result for
each of the 12 quarters.


4.             VESTING AND FORFEITURE OF TARGET
PERFORMANCE-BASED RESTRICTED SHARE UNITS.  (a) The Grantee must remain in the continuous
employ of the Company through the last day of the Performance Period to receive
payment of this award.  The continuous
employment of the Grantee will not be deemed to have been interrupted by reason
of the transfer of the Grantee’s employment among the Company and its
affiliates or an approved leave of absence. 
However, if, prior to the end of the Performance Period, the Grantee
dies or becomes permanently









 



disabled while in the employ of the Company, retires
with the consent of the Company, or terminates employment for the convenience
of the Company (each of the foregoing, a “Forfeiture Event”), then the number
of Target Performance-Based Restricted Share Units upon which the Grantee’s
award is based will be reduced on a pro rata basis based upon the number of
days remaining in the Performance Period following the date of the Forfeiture
Event.


(b)  The Grantee’s
right to receive payment of this award in an amount not to exceed 200% of the
Target Performance-Based Restricted Share Units, rounded up to the nearest
whole share, and to receive the Dividend Equivalents (as defined in Paragraph 6
of these Terms and Conditions) with respect thereto will be based and become
nonforfeitable upon the Administrator’s certification of the attainment of the
Performance Goals.


(c)  Notwithstanding
Section 4(b), if a Change in Control Event occurs prior to the end of the
Performance Period, the Grantee’s right to receive Common Shares equal to the
number of Target Performance-Based Restricted Share Units (as adjusted for any
Forfeiture Event pursuant to Section 4(a)) and to receive the Dividend
Equivalents with respect thereto will become nonforfeitable.


5.             PAYMENT OF AWARDS;
ELECTIVE DEFERRAL.  Up
to and including 200% of the Target Performance-Based Restricted Share Units as
adjusted pursuant to Sections 4 and 7 of these Terms and Conditions will be
settled in Common Shares.  The Common
Shares covered by these Terms and Conditions or any prorated portion thereof
shall be issued to the Grantee as promptly as practicable after the
Administrator’s certification of the attainment of the Performance Goal or the
Change in Control Event, as the case may be. 
Notwithstanding the foregoing, the Grantee may elect pursuant to the
Occidental Petroleum Corporation 2005 Deferred Stock Program to defer receipt
of any Common Shares to which Grantee may be entitled following certification
of the attainment of the Performance Goal. 
This deferral election shall be separate from any deferral election that
the Grantee may make regarding Dividend Equivalents.


6.             CREDITING
AND PAYMENT OF DIVIDEND EQUIVALENTS; ELECTIVE DEFERRAL. 
With respect to the number of Target Performance-Based Restricted Share
Units listed above, the Grantee will be credited on the books and records of
Occidental with an amount (the “Dividend Equivalent”) equal to the amount per
share of any cash dividends declared by the Board on the outstanding Common
Shares during the period beginning on the Date of Grant and ending with respect
to any portion of the Target Performance-Based Restricted Share Units covered
by these Terms and Conditions on the date on which the Grantee’s right to
receive such portion becomes nonforfeitable, or, if earlier, the date on which
the Grantee forfeits the right to receive such portion.  Occidental will pay in cash to the Grantee an
amount equal to the Dividend Equivalents credited to such Grantee adjusted, if
appropriate, to reflect the same payment percentage that is used to determine
the payment of the Target Performance-Based Restricted Share Units following
certification of the attainment of the Performance Goal, as promptly as may be
practicable following such certification. Notwithstanding
the foregoing, the Grantee may elect pursuant to the Occidental Petroleum
Corporation 2005 Deferred Compensation Plan to defer receipt of any Dividend
Equivalents to which Grantee may be entitled following certification of the
attainment of the Performance Goal. This deferral election shall be separate
from any deferral election that the Grantee may make regarding
Performance-Based Restricted Share Units.


7.             ADJUSTMENTS.  (a)   The number or kind of shares of
stock covered by these Terms and Conditions may be adjusted as the
Administrator determines pursuant to Section 6.2 of the Plan in order to
prevent dilution or expansion of the Grantee’s rights under these Terms and



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Conditions as a result of events such as stock
dividends, stock splits or other changes in the capital structure of
Occidental, or any merger, consolidation, spin-off, liquidation or other
corporate transaction having a similar effect. 
If any such adjustment occurs, the Company will give the Grantee written
notice of the adjustment.


(b)   In addition, the Administrator may adjust
the Performance Goal or other features of this Grant as permitted by Section
5.2.3 of the Plan.


8.             NO EMPLOYMENT
CONTRACT.  Nothing in
these Terms and Conditions confers upon the Grantee any right with respect to
continued employment by the Company, nor limits in any manner the right of the
Company to terminate the employment or adjust the compensation of the Grantee.


9.             TAXES AND WITHHOLDING. 
The Grantee is responsible for any federal, state, local or foreign tax,
including income tax, social insurance, payroll tax, payment on account or
other tax-related withholding with respect to the grant of Target
Performance-Based Restricted Share Units (including the grant, the vesting, the
receipt of Common Shares, the sale of Common Shares and the receipt of
dividends or dividend equivalents, if any). 
If the Company must withhold any tax in connection with the issuance of
any Common Shares or the payment of any other consideration pursuant to the
grant of Target Performance-Based Restricted Share Units, (including the
payment of Dividend Equivalents), the Grantee shall satisfy all or any part of
any such withholding obligation first from any cash amount payable under these
Terms and Conditions, and second, by surrendering to the Company a portion of
the Common Shares that are issued or transferred to the Grantee pursuant to
these Terms and Conditions.  Any Common
Shares so surrendered by the Grantee shall be credited against the Grantee’s
withholding obligation at their certification date value.  If the Company must withhold any tax in
connection with granting or vesting of Target Performance-Based Restricted
Share Units (including those for which receipt of the payout is deferred under
a company-sponsored stock deferral program) or the accrual or vesting of
Dividend Equivalents pursuant to this grant of Target Performance-Based
Restricted Share Units (including those for which receipt of the payout is
deferred under a company-sponsored deferral program for cash), the Grantee by
acknowledging these Terms and Conditions agrees that, so long as the Grantee is
an employee of the Company for tax purposes, all or any part of any such
withholding obligation shall be deducted from the Grantee’s wages or other cash
compensation (including regular pay). 
The Grantee shall pay to the Company any amount that cannot be satisfied
in a timely manner by the means described in the previous sentence.


10.           COMPLIANCE WITH LAW.  The Company will make reasonable efforts to
comply with all applicable federal, state and foreign securities laws; however,
the Company will not issue any Common Shares or other securities pursuant to
these Terms and Conditions if their issuance would result in a violation of any
such law.


11.           RELATION TO OTHER
BENEFITS.  The benefits
received by the Grantee under these Terms and Conditions will not be taken into
account in determining any benefits to which the Grantee may be entitled under
any profit sharing, retirement or other benefit or compensation plan maintained
by the Company, including the amount of any life insurance coverage available
to any beneficiary of the Grantee under any life insurance plan covering
employees of the Company.  Additionally, the Target Performance-Based
Restricted Share Units are not part of normal or expected compensation or
salary for any purposes, including, but not limited to, calculation of any
severance, resignation, termination, redundancy, end of service payments,
bonuses or long-service awards.  This grant of Target Performance-Based
Restricted Share



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Units does not create any
contractual or other right to receive future grants of Target Performance-Based
Restricted Share Units, or benefits in lieu of Target Performance-Based Restricted
Share Units even if Grantee has a history of receiving Target Performance-Based
Restricted Share Units or other stock awards.


12.           AMENDMENTS.  The Plan may be modified, amended, suspended
or terminated by the Company at any time, as provided in the Plan.  Any amendment to the Plan will be deemed to
be an amendment to these Terms and Conditions to the extent it is applicable to
these Terms and Conditions; however, no amendment will adversely affect the
rights of the Grantee under these Terms and Conditions without the Grantee’s
consent.


13.           SEVERABILITY.  If one or more of the provisions of these
Terms and Conditions is invalidated for any reason by a court of competent
jurisdiction, the invalidated provisions shall be deemed to be separable from the
other provisions of these Terms and Conditions, and the remaining provisions of
these Terms and Conditions will continue to be valid and fully enforceable.


14.           RELATION TO PLAN;
INTERPRETATION.  These
Terms and Conditions are subject to the terms and conditions of the Plan.  In the event of any inconsistent provisions
between these Terms and Conditions and the Plan, the provisions of the Plan
control.  Capitalized terms used in these
Terms and Conditions without definition have the meanings assigned to them in
the Plan.  References to Sections are to
Sections of these Terms and Conditions unless otherwise noted.


15.           SUCCESSORS AND
ASSIGNS.  Subject to
Sections 2 and 4, the provisions of these Terms and Conditions shall be for the
benefit of, and be binding upon, the successors, administrators, heirs, legal
representatives and assigns of the Grantee, and the successors and assigns of
the Company.


16.           GOVERNING LAW.  The laws of the State of Delaware govern the
interpretation, performance, and enforcement of these Terms and Conditions.


17.           PRIVACY RIGHTS.  By
accepting this award, the Grantee explicitly and unambiguously consents to the
collection, use and transfer, in electronic or other form, of the Grantee’s
personal data as described in these Terms and Conditions by and among, as
applicable, the Company and its affiliates for the exclusive purpose of
implementing, administering and managing the Grantee’s participation in the
Plan.  The Company holds or may
receive from any agent designated by the Company certain personal information
about the Grantee, including, but not limited to, the Grantee’s name, home
address and telephone number, date of birth, social insurance number or other
identification number, salary, nationality, job title, any shares of stock or
directorships held in Occidental, details of this Target Performance-Based
Restricted Share Unit award or any other entitlement to shares of stock
awarded, canceled, exercised, vested, unvested or outstanding in the Grantee’s
favor, for the purpose of implementing, administering and managing the Plan,
including complying with applicable tax and securities laws (“Data”). Data may
be transferred to any third parties assisting in the implementation,
administration and management of the Plan. 
These recipients may be located in the Grantee’s country or elsewhere,
and may have different data privacy laws and protections than the Grantee’s
country.   By accepting these Terms and
Conditions, the Grantee authorizes the recipients to receive, possess, use,
retain and transfer the Data, in electronic or other form, for the purposes
described above.  The Grantee may, at any
time, view Data, request additional information about the storage and
processing of Data, require any necessary amendments to Data or refuse or



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withdraw
the consents herein, in any case without cost, by contacting the Administrator
in writing. Refusing or withdrawing consent may affect the Grantee’s ability to
participate in the Plan.


18.           ELECTRONIC DELIVERY.  The Company may, in its sole discretion,
decide to deliver any documents related to this Target Performance-Based
Restricted Share Unit award granted under the Plan or future awards that may be
granted under the Plan (if any) by electronic means or to request the Grantee’s
consent to participate in the Plan by electronic means.  The Grantee hereby consents to receive such
documents by electronic delivery and, if requested, to participate in the Plan
through an on-line or electronic system established and maintained by the
Company or another third party designated by the Company.


19.           GRANTEE’S REPRESENTATIONS AND
RELEASES. By accepting this award, the Grantee acknowledges that the
Grantee has read these Terms and Conditions and understands that (i) the grant
of this Target Performance-Based Restricted Share Unit award is made
voluntarily by Occidental in its discretion with no liability on the part of
any of its direct or indirect subsidiaries and that, if the Grantee is not an
employee of Occidental, the Grantee is not, and will not be considered, an
employee of Occidental but the Grantee is a third party (employee of a
subsidiary) to whom this Target Performance-Based Restricted Share Unit award
is granted; (ii) the Grantee’s participation in the Plan is voluntary; (iii)
the future value of any Common shares issued pursuant to this Target
Performance-Based Restricted Share Unit award cannot be predicted and
Occidental does not assume liability in the event such Common Shares have no
value in the future; and (iv) subject to the terms of any tax equalization
agreement between the Grantee and the entity employing the Grantee, the Grantee
will be solely responsible for the payment or nonpayment of taxes imposed or
threatened to be imposed by any authority of any jurisdiction.


In consideration of the
grant of this Target Performance-Based Restricted Share Unit award, no claim or
entitlement to compensation or damages shall arise from termination of this
Target Performance-Based Restricted Share Unit award or diminution in value of
this Target Performance-Based Restricted Share Unit award or Common Shares
issued pursuant to this Target Performance-Based Restricted Share Unit award
resulting from termination of the Grantee’s employment by the Company (for any
reason whatsoever and whether or not in breach of local labor laws) and the
Grantee irrevocably releases the Company from any such claim that may arise;
if, notwithstanding the
foregoing, any such claim is found by a court of competent jurisdiction to have
arisen, then, by accepting these Terms and Conditions, the Grantee shall be
deemed irrevocably to have waived his or her entitlement to pursue such claim.



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OCCIDENTAL
PETROLEUM CORPORATION


2005
LONG-TERM INCENTIVE PLAN


PERFORMANCE-BASED
RESTRICTED SHARE UNIT AWARD


TERMS AND
CONDITIONS


EXHIBIT
1

2005 Long-Term Incentive Plan


2006 Grant


 (% of Number of Target
Performance-Based Restricted Share Units that become

Nonforfeitable based on Return on Equity for the Three Year Period Ending June
30, 2009)




	
  Cumulative ROE

  	
   

  	
   

  	
   

  	
  Incentive Payout at End

  of Performance Period

  
	
  Less than 33%

  	
   

  	
  0%

  
	
  33%

  	
   

  	
  20%

  
	
  45%

  	
   

  	
  100%

  
	
  60%

  	
   

  	
  200%

  










*  Payouts for Return on Equity for other values
will be interpolated in the Committee’s discretion


 



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