Document:

Exhibit 10.3

 

AMENDED AND RESTATED

EMPLOYMENT AGREEMENT

 

This Employment Agreement is made as of the 9th day of October, 2008 by
and between Occidental Petroleum Corporation, a Delaware corporation
(hereinafter referred to as “Employer”), and Donald P. de Brier (hereinafter
referred to as “Employee”).

 

WITNESSETH

 

WHEREAS, Employee has been rendering services to Employer, most
recently pursuant to a written agreement between Employee and Employer dated May 22,
2008 (the “Prior Agreement”); and

 

WHEREAS, the parties now desire to amend the Prior Agreement in certain
respects;

 

NOW, THEREFORE, in consideration of the mutual covenants and agreements
herein, Employer and Employee hereby agree to continue Employee’s employment
upon the following terms and conditions:

 

1.             Duties. 
Employee shall continue to perform the duties of Executive Vice
President, General Counsel and Secretary, or shall serve in such other capacity
and with such other duties for Employer or any of the subsidiaries of Employer
or any corporation affiliated with Employer (any such subsidiary or affiliated
corporation hereafter to be deemed Employer under this Agreement) as Employer
may direct.  In performing such duties,
Employee will comply with Employer’s Code of Business Conduct and Corporate
Policies, as the same may be amended from time to time.

 

2.             Term of Employment.  The term of employment hereunder shall be for
a period of five (5) years, commencing on June 1, 2008, and ending
midnight May 31, 2013, unless terminated prior thereto in accordance with
the provisions of this Agreement, or unless extended by mutual agreement in
accordance with Paragraph 9 hereof.

 

3.             Compensation. 
For the services to be performed hereunder, Employee shall be
compensated by Employer at the base pay rate of not less than five hundred
fifty-one thousand dollars ($551,000) per annum, payable semi-monthly.  The minimum salary hereunder shall be
automatically adjusted to the level of any increase in annual compensation as
the Employer may determine during the term of this Agreement.

 

4.             Participation in Benefit Programs.  Employee shall be eligible to participate in
all benefit programs and under the same terms and conditions as are generally
applicable to salaried employees and senior executives of Employer during the
term of his employment and as otherwise provided in this Agreement.  These benefits include life insurance while
employed which pays three (3) times base pay in the event of death.  Employee will be entitled to one country club
membership paid for by Employer provided that the Chief Executive Officer of
Employer has prior approval on the selection of the specific club.  Employee shall also be eligible to
participate in (i) Employer’s 2001 Incentive Compensation Plan, (ii) Employer’s
2005 Long-Term Incentive Plan and (iii) any other equity-based
compensation plan created by Employer during the term of this Agreement (the “Equity-Based
Compensation Plans”), as long 

 

- 1 -

 

as Employer
continues the plans during the term of this Agreement, and to receive awards or
grants under the plans at Employer’s sole discretion.  Employee also shall be entitled to
participate in Employer’s annual incentive plan for senior executives, as in
effect from time to time.  Bonus awards
shall be paid in accordance with the terms of such plan.

 

5.             Exclusivity of
Services.  Employee shall not render
paid or unpaid services on a self-employed basis or to any other employer.

 

6.             Vacation.  Employee shall be entitled to a total of six (6) weeks
vacation per calendar year. Employee agrees to follow Employer’s relevant
policies and procedures for scheduling and taking such vacations.

 

7.             Termination.

 

a.             Cause.  Notwithstanding the term of this
Agreement, Employer may discharge Employee and terminate this Agreement without
severance or other pay for cause, including without limitation, (i) failure
to satisfactorily perform his duties or responsibilities hereunder or
negligence in complying with Employer’s legal obligation, (ii)  refusal to
carry out any lawful order of Employer, (iii) breach of any legal duty to
Employer, (iv) breach of Paragraph 5 of the Agreement, or (v) conduct
constituting moral turpitude or conviction of a crime which may diminish
Employee’s ability to effectively act on the Employer’s behalf or with or on
behalf of others, or (vi) death.  In
the case of events (i) through (v) above, Employer shall give
Employee notice of such cause and Employee shall have thirty (30) days to cure
such breach.

 

b.             Incapacity.  If, during the term of this Agreement,
Employee is incapacitated from performing the essential functions of his job
pursuant to this Agreement by reason of illness, injury, or disability,
Employer may terminate this Agreement by at least one week’s written notice to
Employee, but only in the event that such conditions shall aggregate not less
than one-hundred eighty (180) days during any twelve (12) month period.  In the event Employee shall (i) continue
to be incapacitated subsequent to termination for incapacity pursuant to this
Paragraph 7(b), and (ii) be a participant in and shall qualify for
benefits under Employer’s Long Term Disability Plan (“LTD”), then Employer will
continue to compensate Employee, for so long as Employee remains eligible to
receive LTD benefits, in an amount equal to the difference between sixty
percent (60%) of Employer’s annual compensation as set forth in Paragraph 3
hereof and the maximum annual benefit under the LTD, payable monthly on a pro
rated basis.

 

c.             Without Cause.  Employer may at any time terminate the
employment of Employee without cause or designate a termination for cause as a
termination without cause, and in such event Employer shall, in lieu of
continued employment, compensate Employee in an amount equal to two (2) times
the sum of Employee’s highest annual base salary and annual cash bonus target
prior to Employee’s termination of employment. 
Such amount shall be payable in equal monthly installments (less
appropriate deductions for applicable taxes and the cost of any medical or
dental coverage) over two (2) years, beginning with the first calendar
month following the date of Employee’s termination (the “Compensation Period”).

 

- 2 -

 

In the event
Employee dies during the Compensation Period, any remaining installment
payments due will be paid in a lump sum to Employee’s estate.  Such amount shall be paid as soon as
administratively feasible and in no event later than 90 days following the date
of Employee’s death.

 

In the event of Employee’s termination without cause,
Employee also shall be entitled to the following:

 

(i)            During
the Compensation Period, in addition to any right to additional or accelerated
vesting under the terms of the applicable awards or Equity-Based Compensation
Plan, Employee shall continue to vest in all stock options, stock appreciation
rights, restricted stock and restricted stock units (other than
performance-based awards described in the following paragraph) previously
granted to Employee under the Equity-Based Compensation Plans, as if Employee
had continued as a full-time employee of Employer.  Employee shall continue to be eligible to
exercise all stock options and stock appreciation rights that are or become
exercisable during the Compensation Period, provided that no such awards may be
exercised after the earlier of (I) the latest date on which the award
could have expired pursuant to its terms and (II) ten (10) years
after its original grant date.

 

Any performance-based long-term incentive award or portion of such an
award that is not forfeited at the time of Employee’s termination of employment
shall be paid at the time and in the manner provided for under the terms of
such award.  In addition, Employee shall
be entitled to cash payments with respect to any performance-based long-term
incentive awards previously granted to Employee under the Equity-Based
Compensation Plans that are forfeited at the time of Employee’s termination but
would have become vested had Employee remained continuously employed by
Employer during the Compensation Period, based on Employer’s actual achievement
with respect to the applicable performance-based vesting criteria.  Such payments with respect to such forfeited
awards shall be equal in value to the amounts Employee would have received with
respect to such awards, and shall be made at the time such awards would have
been settled, had Employee remained employed by Employer during the
Compensation Period.

 

(ii)           Employee
and his spouse shall be eligible to participate in Employer’s medical plan, as
in effect from time to time, on the same terms and conditions as are applicable
to other retirees who qualify for retiree medical coverage.  In the event Employer terminates its retiree
medical plan for employees generally before the end of the Compensation Period,
Employee and Employee’s spouse shall be entitled, until the end of the
Compensation Period, to the same medical benefits provided by Employer from
time to time to its active employees generally.

 

(iii)          During
the Compensation Period, Employee shall be entitled to continued
coverage (at Employer’s cost) under any general liability insurance policy
maintained by Employer for the benefit of Employee at the time of Employee’s
termination of employment on the same terms and conditions as are applicable to
senior executives of Employer generally.

 

- 3 -

 

(iv)          During the Compensation Period, Employee and
his spouse shall continue to be eligible to participate in Employer’s dental
plan, as in effect from time to time, at the active participant rate, but on an
after-tax basis.

 

(v)           Within 90 days following the end of each
Payout Period (as defined below), Employee shall receive a lump sum payment
equal to the aggregate employer-provided benefit Employee would have accrued
during such Payout Period under the Occidental Petroleum Corporation Savings
Plan (the “Savings Plan”), the Occidental Petroleum Corporation Retirement Plan
and the Occidental Petroleum Corporation Supplemental Retirement Plan II (or
any successor plan to any of the foregoing) assuming (I) Employee
contributed the maximum elective contributions permissible under the Savings
Plan and (II) a rate of compensation equal to the cash severance paid to
Employee during such Payout Period pursuant to this Paragraph 7(c).  In addition, within 90 days following
the end of each Payout Period, Employee
shall receive a lump sum payment equal to the value (as determined in good
faith by Employer) of continued participation during such Payout Period in any
employee benefit plans in which Employee is participating at the time of his
termination not otherwise described above in this Paragraph 7(c) (but only
to the extent such plans continue to be available to salaried employees and senior
executives during such Payout Period), which payment shall be in lieu of such
continued participation.

 

For purposes of this Paragraph 7(c)(v), a “Payout Period” shall mean
the portion of each calendar year beginning or ending within the Compensation Period
that falls within the Compensation Period. 
Each
Payout Period shall end on December 31 of the calendar year, except that
if the Compensation Period ends during a calendar year, the final Payout Period
shall end on the last day of the Compensation Period.

 

Except as expressly provided above or under the terms
of any plan, program, arrangement or agreement covering Employee, following
Employee’s termination of employment, Employee shall not be entitled to
participate in any employee benefit plans or programs offered by Employer.

 

During the Compensation Period, Employee shall not accept employment
with, or act as a consultant for, or perform services for any person, firm or
corporation directly or indirectly engaged in any business competitive with
Employer without the prior written consent of Employer.

 

d.             Termination
of Employment.  For purposes of this
Agreement, the date of Employee’s termination of employment or retirement shall
be the date of Employee’s “separation from service” within the meaning of Section 409A
(“Section 409A”) of the Internal Revenue Code of 1986, as amended (the “Code”)
and Treas. Reg. § 1.409A-1(i) (or successor provisions) and, for purposes of this Agreement,
references to a “termination,” “termination of employment” or like terms shall
mean “separation from service.” 
For this purpose, Employee shall have a separation from service if he
ceases to be an employee of Employer and all affiliates with whom Employer
would be considered a single employer under Section 414(b) or 414(c) of
the Code.  In addition, for this purpose,
Employee shall have a separation from service if it is reasonably anticipated
that no further services shall be performed by Employee, or that the level of
services Employee shall perform shall permanently decrease to no more than 20
percent of the 

 

- 4 -

 

average level of services
performed by Employee over the immediately preceding 36-month period.

 

8.             Confidential
Information.  Employee agrees that he
will not divulge to any person, nor use to the detriment of Employer or any of
its affiliates or subsidiaries, nor use in any business or process of
manufacture competitive with or similar to any business or process of
manufacture of Employer or any of its affiliates or subsidiaries, at any time
during employment by Employer or thereafter, any trade secrets or confidential
information obtained during the course of his employment with Employer, without
first obtaining the written permission of Employer.

 

Employee agrees that, at the time of leaving the employ of Employer, he
will deliver to Employer, and not keep or deliver to anyone else, any and all
credit cards, notes, notebooks, memoranda, documents and, in general, any and
all material relating to Employer’s business, including copies therefor,
whether in paper or electronic format.

 

9.             Modification.  This Agreement, together with the plans,
programs, arrangements and agreements in which Employee currently participates
or is eligible or becomes eligible to participate, as they may be amended from
time to time in accordance with their terms, contains all the terms and
conditions agreed upon by the parties hereto, and no other agreements, oral or
otherwise, regarding the subject matter of this Agreement shall be deemed to
exist or bind either of the parties hereto. 
This Agreement cannot be modified except by a subsequent writing signed
by both parties.

 

10.           Prior Agreement.  This Agreement supersedes and replaces any
and all previous agreements between the parties.

 

11.           Severability.  If any provision of this Agreement is illegal
and unenforceable in whole or in part, the remainder of this Agreement shall
remain enforceable to the extent permitted by law.

 

12.           Governing Law.  This Agreement shall be construed and enforced
in accordance with the laws of the State of California.  In the event that any ambiguity or questions
of intent or interpretation arise, no presumption or binder of proof shall
arise favoring or disfavoring the Employer by virtue of authorship of this
Agreement and the terms and provisions of this Agreement shall be given their
meaning under law.

 

13.           Assignment.  This Agreement shall be binding upon
Employee, his heirs, executors and assigns and upon Employer, its successors
and assigns.

 

14.           Arbitration.  In consideration for entering into this
Agreement and for the position, compensation, benefits and other promises
provided hereunder, the Employee and Employer agree to be bound by the
arbitration provisions attached hereto as Attachment 1 and incorporated herein
by this reference.

 

- 5 -

 

15.           Section 409A
Compliance.

 

a.             The
intent of the parties is that payments and benefits under this Agreement comply
with Section 409A and the regulations and guidance promulgated thereunder,
to the extent applicable, and, accordingly, to the maximum extent permitted,
this Agreement shall be administered and interpreted to be in compliance
therewith, to the extent applicable.

 

b.             In
the event Employee is a specified employee (within the meaning of Section 409A
and Treas. Reg. § 1.409A-1(i) (or successor provisions) and as determined pursuant to any rules adopted
for such purposes by Employer) as of the date of retirement or
termination, then with regard to any reimbursement or payment or the provision
of any benefit under this Agreement (including, without limitation, Paragraph
7) that is considered deferred compensation under Section 409A payable on
account of a “separation from service” (as distinguished from, for instance, at
a specified time or fixed schedule as described under Treas. Reg. § 1.409A-3(a)(4) and
-3(i)) and that is not exempt from Section 409A as involuntary separation
pay or a short-term deferral (or otherwise), such reimbursement, payment or
benefit shall be paid or provided at the date which is the earlier of (i) the
expiration of the six (6)-month period measured from the date of such “separation
from service” of Employee, and (ii) as soon as administratively feasible
and in no event later than 90 days following the date of Employee’s death (the “Delay
Period”) (unless, in the case of any benefit subject to the Delay Period,
Employer and Employee agree that Employee shall be charged for receiving such
benefit during the Delay Period, at a fair market value price, in which case
Employee shall subsequently be reimbursed by Employer for such charge at the
end of the Delay Period).  Upon the
expiration of the Delay Period, all payments and benefits delayed pursuant to this
Paragraph 15(b) (whether they would have otherwise been payable in a
single sum or in installments in the absence of such delay) shall be paid or
reimbursed to Employee in a lump sum, and any
remaining payments and benefits due under this Agreement shall be paid or
provided in accordance with the normal payment dates specified for them herein.

 

c.             With
regard to any provision herein that provides for reimbursement of costs and
expenses or in-kind benefits (including, without limitation, Paragraphs 4 and
7(c)), the provision of such payment or benefit shall comply with the
requirements of Treas. Reg. § 1.409A-3(i)(1)(iv) (or any successor
provision) for reimbursement and in-kind benefit plans, to the extent
applicable.  For this purpose, (i) the
amount of expenses eligible for reimbursement, or benefits provided, in one
calendar year shall not affect the expenses eligible for reimbursement, or
benefits to be provided, in any other calendar year, (ii) the
reimbursement of any expense shall be made promptly, but in any event no later
than the last day of the calendar year next following the calendar year in
which the expense was incurred, and (iii) the right to any reimbursement
or benefit shall not be subject to liquidation or exchange for any other
benefit.

 

d.             Notwithstanding
anything herein to the contrary, any amount that is subject to Section 409A
and that would have been paid in 2008 under the Prior Agreement and Section 409A
shall be paid by December 31, 2008. 
No amount that is subject to Section 409A shall be paid in 2008
under this Agreement that would not have been paid in 2008 under the Prior
Agreement and Section 409A.

 

- 6 -

 

IN WITNESS WHEREOF, the
parties hereto have executed this Agreement the day and year first above
written.

 

 

	
   

  	
  OCCIDENTAL PETROLEUM
  CORPORATION

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Martin Cozyn

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Donald P. de
  Brier

  	
   

  
	
   

  	
   

  	
    Donald P.
  de Brier

  

 

- 7 -Exhibit
10.4

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

OCCIDENTAL
PETROLEUM CORPORATION

 

MODIFIED DEFERRED COMPENSATION PLAN

 

(Effective December 31,
2006

 

Amended and
Restated Effective November 1, 2008)

 

 

	
  ARTICLE I  PURPOSE

  	
  1

  
	
   

  	
   

  
	
  ARTICLE II  DEFINITIONS

  	
  1

  
	
   

  	
   

  
	
  ARTICLE III  ADMINISTRATION
  OF THE PLAN

  	
  8

  
	
   

  	
   

  
	
  ARTICLE IV  PARTICIPATION

  	
  8

  
	
   

  	
   

  
	
  4.1

  	
  Election to Participate

  	
  8

  
	
   

  	
   

  	
   

  
	
  4.2

  	
  DCP Deferral Accounts

  	
  11

  
	
   

  	
   

  	
   

  
	
  4.3

  	
  SEDCP Deferral Accounts

  	
  11

  
	
   

  	
   

  	
   

  
	
  4.4

  	
  Interest

  	
  11

  
	
   

  	
   

  	
   

  
	
  4.5

  	
  Valuation of Deferral Accounts

  	
  11

  
	
   

  	
   

  	
   

  
	
  4.6

  	
  Savings Plan Restoration Contribution

  	
  12

  
	
   

  	
   

  	
   

  
	
  4.7

  	
  Statement of Deferral Accounts

  	
  12

  
	
   

  	
   

  	
   

  
	
  4.8

  	
  2004 Bonuses

  	
  12

  
	
   

  	
   

  	
   

  
	
  4.9

  	
  Pre-Merger Payment Elections

  	
  13

  
	
   

  	
   

  	
   

  
	
  ARTICLE V  BENEFITS

  	
  13

  
	
   

  	
   

  
	
  5.1

  	
  Separation from Service for a Reason other than
  Death

  	
  13

  
	
   

  	
   

  	
   

  
	
  5.2

  	
  Beneficiary Benefits

  	
  14

  
	
   

  	
   

  	
   

  
	
  5.3

  	
  Spousal Survivor Benefits with Respect to SEDCP
  Deferral Accounts

  	
  16

  
	
   

  	
   

  	
   

  
	
  5.4

  	
  Early Payment

  	
  16

  
	
   

  	
   

  	
   

  
	
  5.5

  	
  Emergency Benefit

  	
  17

  
	
   

  	
   

  	
   

  
	
  5.6

  	
  Effect of Change in Control

  	
  17

  
	
   

  	
   

  	
   

  
	
  5.7

  	
  Small Benefit

  	
  17

  
	
   

  	
   

  	
   

  
	
  5.8

  	
  Tax Withholding and Reporting

  	
  17

  
	
   

  	
   

  	
   

  
	
  5.9

  	
  Reemployment

  	
  18

  
	
   

  	
   

  	
   

  
	
  5.10

  	
  Qualified Divorce Orders

  	
  18

  

 

-i-

 

	
  5.11

  	
  Special 2006 Transition Rule Elections

  	
  18

  
	
   

  	
   

  	
   

  
	
  5.12

  	
  Section 409A Compliance

  	
  20

  
	
   

  	
   

  	
   

  
	
  5.13

  	
  Plan Provisions Control

  	
  20

  
	
   

  	
   

  	
   

  
	
  ARTICLE VI  BENEFICIARY
  DESIGNATION

  	
  20

  
	
   

  	
   

  
	
  ARTICLE VII  CLAIMS PROCEDURE

  	
  21

  
	
   

  	
   

  
	
  7.1

  	
  Applications for Benefits

  	
  21

  
	
   

  	
   

  	
   

  
	
  7.2

  	
  Claims Procedure

  	
  21

  
	
   

  	
   

  	
   

  
	
  7.3

  	
  Section 409A Compliance

  	
  22

  
	
   

  	
   

  	
   

  
	
  7.4

  	
  Limitations on Actions

  	
  22

  
	
   

  	
   

  	
   

  
	
  ARTICLE VIII  AMENDMENT
  AND TERMINATION OF PLAN

  	
  23

  
	
   

  	
   

  
	
  8.1

  	
  Amendment

  	
  23

  
	
   

  	
   

  	
   

  
	
  8.2

  	
  Termination

  	
  24

  
	
   

  	
   

  	
   

  
	
  ARTICLE IX  MISCELLANEOUS

  	
  24

  
	
   

  	
   

  
	
  9.1

  	
  Unsecured General Creditor

  	
  24

  
	
   

  	
   

  	
   

  
	
  9.2

  	
  Trust Fund

  	
  24

  
	
   

  	
   

  	
   

  
	
  9.3

  	
  Nonassignability

  	
  25

  
	
   

  	
   

  	
   

  
	
  9.4

  	
  Release from Liability to Participant

  	
  25

  
	
   

  	
   

  	
   

  
	
  9.5

  	
  Employment Not Guaranteed

  	
  25

  
	
   

  	
   

  	
   

  
	
  9.6

  	
  Gender, Singular & Plural

  	
  25

  
	
   

  	
   

  	
   

  
	
  9.7

  	
  Captions

  	
  25

  
	
   

  	
   

  	
   

  
	
  9.8

  	
  Validity

  	
  26

  
	
   

  	
   

  	
   

  
	
  9.9

  	
  Notice

  	
  26

  
	
   

  	
   

  	
   

  
	
  9.10

  	
  Applicable Law

  	
  26

  

 

-ii-

 

OCCIDENTAL PETROLEUM CORPORATION

MODIFIED DEFERRED COMPENSATION PLAN

 

(Effective December 31, 2006

 

Amended and Restated Effective November 1,
2008)

 

 

ARTICLE
I

PURPOSE

 

Effective December 31, 2006, the
Occidental Petroleum Corporation Deferred Compensation Plan 2 (the “DCP2”) was
merged with and into the Occidental Petroleum Corporation 2005 Deferred
Compensation Plan (the “2005 DCP”), which was amended and restated as the
Occidental Petroleum Corporation Modified Deferred Compensation Plan (the “Plan”).  Effective December 31, 2006, for each
Participant making a Special Transition Rule Election under Section 5.12,
the Deferral Account (if any) of such Participant under the DCP2 was merged
with the Deferral Account (if any) of such Participant under the 2005 DCP, the
Savings Plan Restoration Account (if any) of such Participant under the DCP2
was merged with the Savings Plan Restoration Account (if any) of such
Participant under the 2005 DCP, the SEDCP Deferral Account (if any) of such
Participant under the DCP2 was transferred to the 2005 DCP, and all such
accounts are governed by the terms of this Plan.  For Participants not making such an election,
any Deferral Account, Savings Plan Restoration Account, or SEDCP Deferral
Account of such Participant under the DCP2 or 2005 DCP is subject to the terms
of this Plan but maintained separate from each other.  Effective November 1, 2008, the Plan is
amended and restated as set forth herein.

 

The purpose of the Plan is to provide a
tax-deferred opportunity for key management and highly compensated employees of
Occidental Petroleum Corporation and its Affiliates (as defined below) to
accumulate additional retirement income through deferrals of compensation.

 

This Plan is intended to satisfy the
requirements of Section 409A of the Internal Revenue Code, and any regulations
promulgated thereunder, so that the taxation to Participants or Beneficiaries
of any compensation deferred under this Plan is deferred.

 

ARTICLE
II

DEFINITIONS

 

Whenever the following words
and phrases are used in this Plan with the first letter capitalized, they shall
have the meanings specified below:

 

Affiliate.  “Affiliate” means (i) any corporation
that is a member of a controlled group of corporations (within the meaning of
Code Section 1563(a), determined without regard to Code Sections 1563(a)(4) and
(e)(3)(C), and with the phrase “more than 50%” substituted for the phrase “at
least 80%” each place it appears in Code Section 1563(a)) of which
Occidental Petroleum Corporation is a component member, or (ii) any entity
(whether or not incorporated) that is under common control with Occidental
Petroleum Corporation (as defined in Code

 

 

Section 414(c) and the Treasury
Regulations thereunder, and with the phrase “more than 50%” substituted for the
phrase “at least 80%” each place it appears in the Treasury Regulations under
Code Section 414(c)).

 

Alternate Payee.  “Alternate Payee” means a former spouse of a
Participant who is recognized by a Divorce Order as having a right to receive
all, or a portion of, the benefits payable under this Plan with respect to such
Participant.

 

Amortization Method.  “Amortization Method” means an annual
installment method of paying a Participant’s benefits under which the Company
will pay the Participant an initial payment in an amount equal to (i) plus
(ii) divided by (iii), where (i) is the value of the Participant’s
Deferral Accounts as of the end of the month preceding such payment, (ii) is
the amount of interest that would accrue during the entire payout period on the
unpaid balance credited to the Participant’s Deferral Accounts immediately
following such initial payment if the Declared Rate then in effect remained
unchanged and (iii) is the number of years over which annual installments
are to be paid.  For each Plan Year after
the initial benefit payment is made, the annual benefit payment will be
determined under the same equation where (i) is the value of the
Participant’s Deferral Accounts as of the end of the month preceding the
benefit payment, (ii) is the amount of interest that would accrue during
the remaining payout period on the unpaid balance credited to the Participant’s
Deferral Accounts immediately following such annual payment if the Declared
Rate then in effect remained unchanged and (iii) is the number of annual
payments remaining.

 

Base Salary.  “Base Salary” means the base salary earned by
a Participant during pay periods beginning in a Plan Year, excluding Bonus, all
severance allowances, forms of incentive compensation, Savings Plan, Retirement
Plan or other Company qualified plan contributions or benefits, retainers,
insurance premiums or benefits, reimbursements, and all other payments, prior
to reduction for any deferrals under this Plan or any other plan of the Company
or reductions under the Company’s Savings Plan allowed under Code Section 401(k).

 

Beneficiary.  “Beneficiary” means the person or persons
designated as such in accordance with Article VI.

 

Beneficiary Benefit.  “Beneficiary Benefit” means the payment to a
Participant’s Beneficiary of the value of the Participant’s Deferral Accounts
pursuant to Section 5.2 on account of the Participant’s death.

 

Board.  “Board” means the Board of Directors of
Occidental Petroleum Corporation.

 

Bonus.  “Bonus” means the bonus earned by a
Participant under a regular annual incentive compensation plan (excluding
without limitation a special individual or group bonus, a project bonus, and
any other special bonus) during a Plan Year prior to reduction for any deferral
under this Plan or any other plan of the Company.

 

Change in
Control.  “Change
in Control” means (i) for purposes of Sections 8.1 and 8.2(a), any event
described in (a), (b), (c) or (d) below, and (ii) for purposes
of Section 5.6, any 

 

2

 

event that
constitutes a “change in control event” for purposes of Code Section 409A
and Treas. Reg. § 1.409A-3(i)(5) (or any successor provisions) and that is
described in subsection (a), (b), (c) or (d) below:

 

(a)           Approval by the stockholders of Occidental Petroleum
Corporation (or, if no stockholder approval is required, by the Board) of the
dissolution or liquidation of Occidental Petroleum Corporation, other than in
the context of a transaction that does not constitute a Change in Control under
subsection (b) below;

 

(b)           Consummation of a merger, consolidation, or other
reorganization, with or into, or the sale of all or substantially all of
Occidental Petroleum Corporation’s business and/or assets as an entirety to,
one or more entities that are not subsidiaries or other affiliates of
Occidental Petroleum Corporation (a “Business Combination”), unless (i) as
a result of the Business Combination, more than 50% of the outstanding voting
power of the surviving or resulting entity or a parent thereof (the “Successor
Entity”) immediately after the Business Combination is, or will be, owned,
directly or indirectly, by holders of Occidental Petroleum Corporation’s voting
securities immediately before the Business Combination; (ii) no “person”
(as such term is used in Sections 13(d) and 14(d) of the Securities
Exchange Act of 1934, as amended from time (the “Exchange Act”)), excluding the
Successor Entity or any employee benefit plan of Occidental Petroleum
Corporation and any trustee or other fiduciary holding securities under an
Occidental Petroleum Corporation employee benefit plan or any person described
in and satisfying the conditions of Rule 13d-1(b)(i) of the Exchange
Act (an “Excluded Person”), beneficially owns, directly or indirectly, more
than 20% of the outstanding shares or the combined voting power of the
outstanding voting securities of the Successor Entity, after giving effect to
the Business Combination, except to the extent that such ownership existed
prior to the Business Combination; and (iii) at least 50% of the members
of the board of directors of the entity resulting from the Business Combination
were members of the Board at the time of the execution of the initial agreement
or of the action of the Board approving the Business Combination;

 

(c)           Any “person” (as such term is used in Sections 13(d) and
14(d) of the Exchange Act, but excluding any Excluded Person) is or
becomes the beneficial owner (as defined in Rule 13d-3 under the Exchange
Act), directly or indirectly, of securities of Occidental Petroleum Corporation
representing 20% or more of the combined voting power of Occidental Petroleum
Corporation’s then outstanding voting securities, other than as a result of (i) an
acquisition directly from Occidental Petroleum Corporation; (ii) an
acquisition by Occidental Petroleum Corporation; or (iii) an acquisition
by any employee benefit plan (or related trust) sponsored or maintained by
Occidental Petroleum Corporation or a Successor Entity; or

 

(d)           During any period not longer than two consecutive years,
individuals who at the beginning of such period constituted the Board cease to
constitute at least a majority thereof, unless the election, or the nomination
for election by Occidental Petroleum Corporation’s stockholders, of each new
Board member was approved by a vote of at least two-thirds (2/3) of the Board
members then still in office who were Board members at the beginning of such
period (including for these purposes, new members whose election or nomination
was so approved), but excluding, for this purpose, any such individual whose initial
assumption of office occurs as a result of an actual or threatened election
contest with respect to the election or removal of directors or other actual or
threatened solicitation of proxies or consents by or on behalf of a person
other than the Board.

 

3

 

Code.  “Code” means the Internal Revenue Code of
1986, as amended.

 

Committee.  “Committee” means the administrative
committee appointed to administer the Plan pursuant to Article III.

 

Company.  “Company” means Occidental Petroleum
Corporation, or any successor thereto, and any Affiliates.

 

Company Management.  “Company Management” means the Chairman of
the Board, President or any Executive Vice President of Occidental Petroleum
Corporation.

 

Compensation.  “Compensation” means Base Salary, Bonus
and/or, prior to 2008, Performance Award Cash Deferrals.

 

DCP Deferral Account.  “DCP Deferral Account” means the account
maintained on the books of account of the Company for each Participant pursuant
to Article IV to account for amounts deferred under the 1988 DCP prior to January 1,
1999, and the amounts subsequently deferred under the Prior Plan, the DCP2, the
2005 DCP and this Plan.

 

DCP Deferral Amount.  “DCP Deferral Amount” means an amount of a
Participant’s Base Salary and/or Bonus that is deferred under the Plan,
including amounts deferred under the 1988 DCP, the Prior Plan, the DCP2, the
2005 DCP and this Plan.

 

DCP2.  “DCP2” means the Occidental Petroleum
Corporation Deferred Compensation Plan 2, effective as of October 12,
2006.

 

Declared Rate.  “Declared Rate” with respect to any Plan Year
means the rate at which interest will be credited on Deferral Accounts for such
Plan Year.  The Declared Rate for each
Plan Year ending on or before December 31, 2008, shall be equal to the
greater of (i) (A) plus (B) where (A) is the Moody’s
Long-Term Corporate Bond Index Monthly Average Corporates as published by Moody’s
Investor Services, Inc. (or successor thereto) for the month of July in
the year prior to the Plan Year in question, and (B) is 3% (“Moody’s Plus
Three”), or (ii) the highest yield on any unsecured debt or preferred
stock of the Company that was outstanding on the last day of July in the
year prior to the Plan Year in question. 
Such Declared Rate will be announced on or before January 1 of the
applicable Plan Year.  The Declared Rate
for each Plan Year commencing on or after January 1, 2009, will be the
monthly yield on

5-year Treasury Constant Maturities plus 2%. 
Notwithstanding the foregoing, the Declared Rate for DCP Deferral
Amounts that were earned and deferred prior to 1994 under the 1988 DCP
(including bonuses which were earned for 1993), together with accumulated
interest thereon, will in no event be less than 8% for any Plan Year.  Accordingly, the Declared Rate for any Plan
Year may be different for DCP Deferral Amounts that were earned and deferred
under the 1988 DCP prior to January 1, 1994 than for DCP Deferral Amounts
earned after such date.

 

Deferral Account(s).  “Deferral Account(s)” means a Participant’s
DCP Deferral Account and/or SEDCP Deferral Account (if any) and/or Savings Plan
Restoration Account (if any) maintained on the books of account of the Company
for each Participant pursuant to Article IV.

 

4

 

Deferral Election Form.  “Deferral Election Form” means a paper or
electronic election form provided by the Committee on which an Eligible
Employee may elect to defer Base Salary and/or Bonus and may elect to receive
an Early Payment Benefit in accordance with Article IV.

 

Distribution Election Form.  “Distribution Election Form” means a paper or
electronic election form provided by the Committee on which a Participant may
elect the form of payment of his Retirement Benefits and/or the form of payment
of Beneficiary Benefits to his Beneficiary in accordance with Article V.

 

Divorce Order.  “Divorce Order” means any judgment, decree,
or order (including judicial approval of a property settlement agreement) that
relates to the settlement of marital property rights between a Participant and
his former spouse pursuant to state domestic relations law (including, without
limitation and if applicable, community property law), as described in Treas.
Reg. § 1.409A-3(j)(4)(ii).

 

Early Payment Benefit.  “Early Payment Benefit” means the payment to
a Participant of part or all of the Participant’s DCP Deferral Account in an
Early Payment Year beginning prior to the Participant’s Retirement or other
Separation from Service pursuant to Section 5.4.

 

Early Payment Year.  “Early Payment Year” means any year beginning
prior to a Participant’s Retirement or other Separation from Service that a
Participant elects pursuant to Section 4.1(b) to have an Early
Payment Benefit paid or commenced to be paid.

 

Early Payment Year Subaccount.  “Early Payment Year Subaccount” means any
subaccount of a Participant’s DCP Deferral Account established to separately
account for deferred Base Salary and/or Bonus (and interest credited thereto)
that is subject to an Early Payment Benefit election.

 

Eligible Employee.  “Eligible Employee” means each key management
employee or other highly compensated employee of the Company who is selected by
Company Management to participate in the Plan.

 

Emergency Benefit.  “Emergency Benefit” means the payment to a
Participant of part or all of his Deferral Accounts in the event that the
Participant has an Unforeseeable Emergency pursuant to Section 5.5.

 

ERISA.  “ERISA” means the Employee Retirement Income
Security Act of 1974, as amended.

 

Fractional Method.  “Fractional Method” means an installment
method of paying a Participant’s Retirement Benefit under which the Company
will determine the amount of each annual installment by dividing the value of
the Participant’s Deferral Accounts as of the end of the month preceding the
payment date by the number of annual installments remaining to be paid.

 

5

 

1988 DCP.  “1988 DCP” means the Occidental Petroleum
Corporation 1988 Deferred Compensation Plan.

 

Participant.  “Participant” means (i) each individual
who, as of December 30, 2006, was a participant in the 2005 DCP or DCP2
and has not received a complete distribution of the benefits accrued under
those plans, (ii) an Eligible Employee who has filed a completed and fully
executed Deferral Election Form with the Committee and is participating in
the Plan in accordance with the provisions of Article IV, and (iii) any
person who has a Deferral Account by reason of his prior status as an Eligible
Employee.  Under no circumstances shall “Participant”
mean any Alternate Payee.

 

Performance Award Cash Deferral.  “Performance Award Cash Deferral” means that
portion of a Qualifying Performance Stock Award that is deferred under this
Plan prior to 2008 as provided in Section 4.1(c) of this Plan.

 

Plan Year.  “Plan Year” means the calendar year beginning
on January 1 and ending on December 31.

 

Prior Plan.  “Prior Plan” means the Occidental Petroleum
Corporation Deferred Compensation Plan as amended and restated as of January 1,
2003, under which deferrals ceased as of December 31, 2004.

 

Qualified Divorce Order.  “Qualified Divorce Order” means a Divorce
Order that (a) creates or recognizes the existence of an Alternate Payee’s
right to, or assigns to an Alternate Payee the right to, receive all or a
portion of the benefits payable to a Participant under this Plan; (b) clearly
specifies (i) the name and the last known mailing address of the
Participant and the name and mailing address of the Alternate Payee covered by
the order, (ii) the amount or percentage of the Participant’s benefits to
be paid by this Plan to the Alternate Payee, or the manner in which such amount
or percentage is to be determined, (iii) the number of payments or period
to which such order applies, and (iv) that it applies to this Plan; and (c) does
not (i) require this Plan to provide any type or form of benefit, or any
option, not otherwise provided under the Plan, (ii) require this Plan to
provide increased benefits, or (iii) require the payment of benefits to an
Alternate Payee that are required to be paid to another Alternate Payee under
another Divorce Order previously determined to be a Qualified Divorce Order.

 

Qualifying Performance Stock Award.  “Qualifying Performance Stock Award” has the
meaning given to such term under the 2005 DSP.

 

Retirement.  “Retirement” means the Participant’s
Separation from Service for reasons other than death after the Participant
attains age 55.  Notwithstanding the
foregoing, with respect to Participants who executed a consulting agreement
with the Company prior to October 3, 2004, “Retirement” means the
termination date of the Participant’s consulting agreement.

 

Retirement Benefit.  “Retirement Benefit” means the payment to a
Participant of the value of the Participant’s Deferral Accounts pursuant to Section 5.1
following Retirement.

 

6

 

Retirement Plan.  “Retirement Plan” means the Occidental
Petroleum Corporation Retirement Plan, as amended from time to time.

 

SEDCP.  “SEDCP” means the Occidental Petroleum
Corporation Senior Executive Deferred Compensation Plan under which certain
Company executives deferred compensation.

 

SEDCP Deferral Account.  “SEDCP Deferral Account” means the account
maintained on the books of account of the Company for certain Participants
pursuant to Article IV to account for amounts deferred under the SEDCP.

 

Savings Plan.  “Savings Plan” means the Occidental Petroleum
Corporation Savings Plan, as amended from time to time.

 

Savings Plan Restoration Account.  “Savings Plan Restoration Account” means the
account maintained on the books of account of the Company to reflect Savings
Plan Restoration Contributions made by the Company pursuant to Section 4.6.

 

Savings Plan Restoration Contribution.  “Savings Plan Restoration Contribution” means
the amount credited to a Participant’s Savings Plan Restoration Account pursuant
to Section 4.6.

 

Separation from Service.  “Separation from Service” means a Participant’s
“separation from service” as defined under Code Section 409A and Treas.
Reg. § 1.409A-1(h) (or successor provisions).  A Participant shall have a Separation from
Service if the Participant ceases to be an employee of both:

 

(i)            The Company that
employs the Participant; and

 

(ii)           All Affiliates with
whom such Company would be considered a single employer under Code Section 414(b)
or 414(c).

 

For this purpose, a Participant who ceases to be an employee of an
entity described in (i) or (ii) above shall not be considered to have
a Separation from Service if such cessation of employment is followed
immediately by his commencement of employment with another entity described in (1) or
(2) above.

 

A Participant shall have a Separation from Service if it is reasonably
anticipated that no further services shall be performed by the Participant, or
that the level of services the Participant shall perform shall permanently decrease
to no more than 20 percent of the average level of services performed by the
Participant over the immediately preceding 36-month period (or the Participant’s
full period of service, if the Participant has been performing services for
less than 36 months).

 

Specified Employee.  “Specified Employee” means an Employee who is
a “specified employee” within the meaning of Section 409A and Treas. Reg.
§ 1.409A-1(i) (or successor provisions) and as determined pursuant to
any rules adopted for such purposes by Occidental Petroleum Corporation.

 

7

 

Termination Benefit.  “Termination Benefit” means the payment to a
Participant of the value of the Participant’s Deferral Accounts pursuant to Section 5.1
on account of the Participant’s Separation from Service other than due to
Retirement or death.

 

2005 DCP.  “2005 DCP” means the Occidental Petroleum
Corporation 2005 Deferred Compensation Plan, restated as of January 1,
2005 and as subsequently amended.

 

2005 DSP.  “2005 DSP” means the Occidental Petroleum
Corporation 2005 Deferred Stock Program, as amended from time to time.

 

Unforeseeable
Emergency.  “Unforeseeable
Emergency” means a severe financial hardship to the Participant resulting from
an illness or accident of the Participant, the Participant’s spouse, or a
dependent (as defined in Code Section 152, without regard to Code Sections
152(b)(1), (b)(2) and (d)(1)(B)) of the Participant, loss of the
Participant’s property due to casualty, or other similar extraordinary and
unforeseeable circumstances arising as a result of events beyond the control of
the Participant.

 

Years of Service.  “Years of Service” means the number of full
years credited to a Participant under the Retirement Plan for vesting purposes.

 

ARTICLE
III

ADMINISTRATION OF THE PLAN

 

A Committee shall be appointed by the Board
to administer the Plan and establish, adopt, or revise such rules and
regulations as the Committee may deem necessary or advisable for the
administration of the Plan and to interpret the provisions of the Plan, and,
except as otherwise indicated herein, any such interpretations shall be
conclusive and binding.  All decisions of
the Committee shall be by vote of at least two of the Committee members and
shall be final.  The Committee may
appoint any agent and delegate to such agent such powers and duties in
connection with the administration of the Plan as the Committee may from time
to time prescribe.  The Plan is intended
to comply with the requirements of Code Section 409A and shall be
interpreted and administered accordingly.

 

Members of the Committee shall be eligible to
participate in the Plan while serving as members of the Committee, but a member
of the Committee shall not vote or act upon any matter which relates solely to
such member’s interest in the Plan as a Participant.

 

ARTICLE
IV

PARTICIPATION

 

4.1           Election
to Participate.

 

(a)            Deferral Elections.  An Eligible Employee may elect to participate
in the Plan and elect to defer annual Base Salary and/or Bonus under the Plan
by filing with the Committee a completed and fully executed Deferral Election Form prior
to the beginning of the Plan Year during which the Eligible Employee performs
the services for which such Base Salary and Bonus are to be earned, or at such
other time as the Committee may permit in accordance 

 

8

 

with the regulations
promulgated under Code Section 409A.  Deferral Election Forms must be
filed in accordance with the instructions set forth in the Deferral Election
Forms.

 

An employee who first becomes an Eligible
Employee during a Plan Year may make an initial deferral election under this
Plan within 30 days after the date the employee becomes an Eligible
Employee provided that such Eligible Employee has not previously become
eligible to participate in any other account balance plan that is required to
be aggregated with this Plan as described in Treas. Reg. § 1.409A-1(c)(2) (or
any successor provision).  Any such
election shall apply to Base Salary earned for services performed after the
30-day election window described in the previous sentence and to that portion
of the Bonus earned during such Plan Year equal to the total amount of the
Bonus multiplied by the ratio of the number of days remaining in the Plan Year
after the 30-day election window described in the previous sentence ends over
the total number of days in the Plan Year.

 

A Deferral Election Form filed for a
Plan Year shall be effective for Base Salary and/or Bonus to be earned during
that Plan Year only.  For each subsequent
Plan Year, an Eligible Employee who wishes to defer Base Salary and/or Bonus
must file a new complete and fully executed Deferral Election Form in
accordance with the instructions set forth in the Deferral Election Form but
in any event prior to January 1 of such Plan Year.

 

Each Deferral Election Form will
designate the DCP Deferral Amounts as a fixed dollar amount or fixed percentage
(in increments of 1%) of Base Salary and/or (i) a fixed dollar amount or a
fixed percentage of Bonus or (ii) 100% of any Bonus exceeding a specified
dollar amount, as elected by the Participant. 
Deferrals of Base Salary will normally be deducted ratably during the
Plan Year, except as otherwise determined by the Committee to take into account
special circumstances; provided that in no event will the Committee’s action
alter the total amount of Deferrals for the Plan Year.  In its sole discretion, the Committee may
also permit amounts that an Eligible Employee has previously elected to defer
under other plans or agreements with the Company to be transferred to this Plan
and credited to his Deferral Accounts that are maintained hereunder, provided
that no change shall be made in the time or form of payment of such transferred
amounts except as may be permitted by Code Section 409A.

 

(A)          Minimum Deferral.  For each Plan Year, the minimum amount of
Base Salary that a Participant may elect to defer is $5,000, if expressed as a
dollar amount, or 5% of Base Salary, if expressed as a percentage, and the minimum
amount of Bonus that a Participant may elect to defer is any of the
following:  (I) $5,000, (II) 5%
of Bonus, or (III) 100% of that portion of any Bonus that exceeds a dollar
amount specified by the Participant on his Deferral Election Form.

 

(B)           Maximum Deferral.  For each Plan Year, the maximum amount of
Base Salary that a Participant may elect to defer is 75% of Base Salary, and
the maximum amount of Bonus that a Participant may elect to defer is 90% of
Bonus.  Notwithstanding the foregoing,
effective with respect to amounts earned on or after January 1, 2007, for
each Plan Year, the maximum total amount of Compensation  that
a Participant may elect to defer is $75,000. 
For the 2007 Plan Year, the $75,000 limit shall apply only to deferrals
of Base Salary that would otherwise have been paid in 2007.  For the 2008 Plan Year, the $75,000 limit
shall apply to the deferrals of Base Salary that 

 

9

 

would have
otherwise been paid in 2008 plus deferrals of Bonus, earned in 2007, and
otherwise paid in 2008.  For the 2008
Plan Year, the $75,000 limit shall also apply to deferrals of Base Salary that
would have otherwise been paid in 2008 plus deferrals of Bonus, earned in 2008,
and otherwise paid in 2009.  For the 2009
and all future Plan Years, the $75,000 limit shall apply to amounts of Base
Salary and Bonus earned in any one Plan Year. 
For example, in Plan Year 2009, the $75,000 limit shall first apply to
deferrals of Base Salary that would have otherwise been paid in 2009 and then
to deferrals of Bonus that are earned in 2009 and would otherwise be payable in
2010.

 

(C)           Deferral Account Balance.  Notwithstanding anything herein to the
contrary, if as of December 31 of any Plan Year, a Participant’s total
Deferral Account balance is $1,000,000 or more, then the Participant may not
defer any compensation earned in the following Plan Year and any election to do
so shall be considered void.  If as of December 31
of any Plan Year, a Participant’s total Deferral Account balance is less than
$1,000,000, then the Participant may defer compensation earned in the following
Plan Year in accordance with this Article IV.

 

(b)           Early
Payment Benefit Election.  With
respect to Base Salary and/or Bonus earned after December 31, 2007, on the
Deferral Election Form filed pursuant to Section 4.1(a), an Eligible
Employee may irrevocably elect to receive all or a portion of the Base Salary
and/or Bonus deferred pursuant to that election in a lump sum payment or in
annual installments over two (2) to five (5) years commencing prior
to Separation from Service in an Early Payment Year.  If a Participant fails to designate the form
of distribution for an Early Payment Benefit, the distribution shall be in the
form of a lump sum.  The Early Payment
Year elected must be a year that begins at least two (2) years after the
end of each Plan Year to which the election applies.  An Early Payment Benefit election filed for
the Plan Year beginning January 1, 2008, or for any subsequent Plan Year,
shall be effective for the deferred Base Salary and/or Bonus earned during that
Plan Year.  A Participant may make an
election for an Early Payment Benefit with respect to deferred Base Salary
and/or Bonus earned in any future Plan Year by filing a new Deferral Election Form with
the Committee prior to January 1 of such Plan Year.  A Participant may not, however, change the
form of benefit or time of commencement of an Early Payment Benefit with
respect to Base Salary and/or Bonus deferred pursuant to a Deferral Election Form after
that Deferral Election is filed pursuant to Section 4.1(a).

 

A Participant may not at any time have Early
Payment Benefits scheduled for more than two Early Payment Years.  However, after an Early Payment Year has
occurred and all payments with respect to the corresponding Early Payment Year
election have been completed, a Participant may elect a new Early Payment Year
for future deferrals of Base Salary and/or Bonuses.

 

(c)           Deferral
of Performance Award Cash Payments. 
Notwithstanding anything contained herein to the contrary, the cash
portion (if any) subject to a deferral election under a Qualifying Performance
Stock Award that was granted before December 31, 2006 but becomes vested
on or after December 31, 2006 shall be credited to the Eligible Employee’s
DCP Deferral Account as a Performance Award Cash Deferral unless the
Participant elected, pursuant to transition rules under Code Section 409A,
to receive distribution of the cash portion of the Qualifying Performance Stock
Award in 2008.  Any cash portion of a
Qualifying Performance 

 

10

 

Stock Award that becomes
vested on or after December 31, 2006 and payable in 2008 pursuant to an
election as described herein, shall be credited to a special subaccount of the
Participant’s DCP Deferral Account and distributed in a lump sum during the
first seventy-five (75) days of 2008.  No
additional amounts shall be credited to a Participant’s DCP Deferral Account
pursuant to this provision after December 31, 2007.

 

4.2           DCP
Deferral Accounts.  The Committee
shall establish and maintain a separate DCP Deferral Account for each
Participant.  A DCP Deferral Amount shall
be credited by the Company to the Participant’s DCP Deferral Account, subject
to the Committee’s authority in Section 4.1(a), as of the date that the
Participant’s Base Salary and/or Bonus would otherwise have been paid.  The amount of a Participant’s Performance
Award Cash Deferral shall be credited to a Participant’s DCP Deferral Account
as of the date it becomes certified for payment.  Such DCP Deferral Account shall be debited by
the amount of any payments made by the Company to the Participant or the
Participant’s Beneficiary therefrom as of the date of payment.  The Committee shall establish an Early
Payment Year Subaccount within a Participant’s DCP Deferral Account for each
Early Payment Year elected by that Participant. 
Any such Early Payment Year Subaccount shall be debited by the amount of
any Early Payment Benefit paid by the Company to the Participant in such Early
Payment Year pursuant to Section 5.4 as of the date of payment.

 

4.3           SEDCP
Deferral Accounts.  The Committee
shall maintain a separate SEDCP Deferral Account for each Participant who was a
participant in the SEDCP on December 31, 1998.  The balance of such Participant’s accounts
under the SEDCP as of December 31, 1998 remained credited to each such
Participant’s SEDCP Deferral Account under the Occidental Petroleum Corporation
Deferred Compensation Plan, a predecessor to this Plan, as of January 1,
1999.  SEDCP Deferral Accounts shall be
debited by the amount of any payments made by the Company to the Participant or
the Participant’s Beneficiary therefrom as of the date of payment.

 

4.4           Interest.  Each Deferral Account of a Participant shall
be deemed to bear interest on the monthly balance of such Deferral Account at
the Declared Rate, compounded monthly. 
Except as provided in Section 5.2(a), with respect to SEDCP
Deferral Accounts for Participants who die prior to becoming eligible for
Retirement, interest will be credited to each Deferral Account on a monthly
basis on the last day of each month as long as any amount remains credited to
such Deferral Account.  Amounts of deferred
Compensation that are credited to a DCP Deferral Account and amounts of Savings
Plan Restoration Contributions that are credited to a Savings Plan Restoration
Account prior to the end of a calendar month shall accrue interest from the
date of crediting, computed from date of crediting to the end of the month.

 

4.5           Valuation
of Deferral Accounts.  The value of a
Deferral Account as of any date shall equal the amounts previously credited to
such Deferral Account less any payments debited to such Deferral Account plus
the interest deemed to be earned on such Deferral Account in accordance with Section 4.4
through the end of the preceding month. 
When payments are made from a DCP Deferral Account for any reason other
than an Early Payment Benefit elected after January 1, 1994, such payments
shall be deemed to be made on a proportionate or pro-rata basis from DCP
Deferral Amounts (including accumulated interest thereon) that were earned and
deferred under the 1988 DCP prior to January 1, 1994, and DCP Deferral
Amounts (including accumulated interest thereon) that were earned and deferred
after that date.

 

11

 

4.6           Savings
Plan Restoration Contribution.

 

(a)            General Rule.  For each Plan Year, the Company shall credit
to the Savings Plan Restoration Account of any Participant, an amount equal to
the amount by which the contribution that would otherwise have been made by the
Company on behalf of the Participant to the Savings Plan for such Plan Year is
reduced by reason of the reduction in the Participant’s Base Salary for such
Plan Year and/or the Participant’s Annual Bonus (as defined in the Savings
Plan) paid in such Plan Year because of deferrals under this Plan.  The Savings Plan Restoration Contribution
shall be credited to the Savings Plan Restoration Account of each Participant
for each Plan Year at the same time as the Company contribution for such Plan
Year is made to the Savings Plan.  No
further Savings Plan Restoration Contributions shall be credited to Participants’
Savings Plan Restoration Accounts pursuant to this provision on or after December 31,
2008.

 

(b)           Vesting.  A Participant’s interest in any credit to his
Savings Plan Restoration Account and earnings thereon shall vest at the same
rate and at the same time as would have been the case had such contribution
been made to the Savings Plan. 
Notwithstanding anything contained herein to the contrary, if, upon a
Participant’s Separation from Service, the Participant has not or does not
become 100% vested in his Savings Plan Restoration Account, the unvested
portion of his Savings Plan Restoration Account shall be forfeited prior to the
determination of the amount of any benefits under Sections 5.1, 5.5, or 5.6.

 

(c)           Transfer
of Non-Vested Savings Plan Restoration Account from Prior Plan.  Effective as of January 1, 2005, that
portion of a Participant’s Savings Plan Restoration Account under the Prior
Plan that was not vested as of December 31, 2004, was transferred to and
credited to such Participant’s Savings Plan Restoration Account under the 2005
DCP and is governed by the terms of this Plan, including any Distribution
Election Form filed under the 2005 DCP on or before December 31,
2005.  If the Participant was not
participating in the 2005 DCP in 2005, the Participant could nevertheless make
an election in accordance with Section 5.1(b) and 5.2 of the 2005 DCP
if such election was made by December 31, 2005.  If the Participant did not file a
Distribution Election Form on or before December 31, 2005, with
respect to such amount, together with interest the Participant was deemed to
have made an election to receive distribution in accordance with Section 5.1(a).

 

4.7           Statement
of Deferral Accounts.  The Committee
shall submit to each Participant, within 120 days after the close of each Plan
Year, a statement in such form as the Committee deems desirable, setting forth
the Participant’s Deferral Account(s).

 

4.8           2004 Bonuses

 

(a)           Deferral
under the 2005 DCP.  Any Bonus that
was payable in 2005 to an employee of the Company for services performed during
2004 (a “2004 Bonus”) and that such individual elected to defer in accordance
with the terms of the Prior Plan was deferred under the 2005 DCP instead of the
Prior Plan.  Any such 2004 Bonus was
credited to the individual’s DCP Deferral Account as set forth in Section 4.2
and is subject to the terms and conditions of this Plan, including, without
limitation, any distribution election made under Article V; provided,
however, that if such individual did not file a Distribution Election Form under
the 2005 DCP as 

 

12

 

provided in Section 5.1(b) at the
time such 2004 Bonus was credited to his DCP Deferral Account, he could file a
Distribution Election Form at any time prior to February 11, 2005,
which then became applicable with respect to his 2004 Bonus and any other
Compensation deferred and credited to the Participant’s DCP Deferral Account
under this Plan.

 

(b)           Opportunity
to Revoke Deferral Election. 
Notwithstanding anything contained herein to the contrary, any
participant in the Prior Plan who elected to defer his 2004 Bonus could revoke
his deferral election as provided in this Section 4.8(b).  Such election had to be in writing on a form
provided by the Committee and had to be filed with the Committee on or before January 21,
2005.  Any participant in the Prior Plan
who revoked his 2004 Bonus deferral election as provided herein received his
2004 Bonus in cash at or about the same time that 2004 Bonuses were paid to
other employees of the Company.

 

4.9           Pre-Merger Payment Elections.  Any payment elections made or deemed to be
made by a Participant under the DCP2 or the 2005 DCP and in effect immediately
prior to the merger of the two plans on December 31, 2006 shall remain in
effect with respect to the portions of the applicable Deferral Accounts
attributable to amounts deferred under each plan and shall continue in effect
unless and until changed in accordance with the terms of this Plan.  The Committee shall establish and maintain
separate subaccounts for each Deferral Account as may be necessary to account
for amounts subject to different payout elections.

 

ARTICLE
V

BENEFITS

 

5.1           Separation
from Service for a Reason other than Death.

 

(a)            Form and Time of Benefit.  Except as otherwise provided in this Sections 5.1
and 5.4, upon a Participant’s Separation from Service for a reason other than
death (including Retirement), the Company shall pay to the Participant in a
single lump sum within the first 90 days of the calendar year following the
year of the Participant’s Separation from Service an amount equal to the value
of the Participant’s Deferral Accounts as of the end of the month preceding
payment (after reduction for any forfeitures as set forth in Section 4.6).  Any Retirement Benefit paid in annual installments
pursuant to Section 5.1(b) shall be paid within the first 90 days of
each calendar year, beginning with the year following the Participant’s
Retirement and shall be determined based on the value of the Participant’s
Deferral Accounts as of the last day of the month preceding payment.  Notwithstanding anything herein to the
contrary, in the event that a Participant who is a Specified Employee is
entitled to a distribution from the Plan upon or by virtue of such Participant’s
Separation from Service for a reason other than death, the lump sum payment or
the first annual installment payment, as the case may be, shall be paid in the
month next following the date that is six (6) months after the date of the
Participant’s Separation from Service, if later than the time provided
above.  Any additional installment
payments shall be paid within the first 90 days of each subsequent calendar
year.

 

(b)           Retirement.  (i) On a Distribution Election Form filed
simultaneously with and in the same manner as the first Deferral Election Form that
a Participant is required to file in accordance with the requirements set forth
in Section 4.1 hereof, a Participant (A) may elect to have the
Retirement Benefit, which may consist solely of the Participant’s Savings Plan 

 

13

 

Restoration Account, but
which will not include any amounts attributable to an Early Payment Year
Subaccount if Separation from Service occurs after beginning of the relevant
Early Payment Year, paid to him in a lump sum or annual payments for any other
number of years between two (2) and 20 years, and (B) may elect to
have the amount of each annual installment determined under either the
Amortization Method or the Fractional Method. 
If a Participant fails to elect either the Amortization Method or the
Fractional Method, such Participant shall be deemed to have elected the
Fractional Method.

 

(ii) Notwithstanding anything herein to the
contrary, an election to receive distribution in a series of annual installments
shall be treated as a single payment for purposes of Code Section 409A.

 

(iii) Subject to Section 5.1(b)(iv), a
Participant may change his election as to the form of Retirement distribution
under this Plan subject to the following conditions:  (A) the election shall not be effective
until twelve (12) months after the election is filed with the Committee; (B) the
election must defer the lump sum payment or the initial amount of an
installment payment for a period of at least five (5) years from the date
that the lump sum payment or initial amount of the installment payment, as the
case may be, was otherwise payable; and (C) the election must be made at
least twelve (12) months prior to the beginning of the calendar year in which
the lump sum payment or initial amount of the installment payment, as the case
may be, would have been payable if no change as to the form of distribution
were ever made.

 

(iv) A Participant may only make two changes
pursuant to Section 5.1(b)(iii). 
Each such change must satisfy all of the requirements of Section 5.1(b)(iii).  No further changes may be made following a Participant’s Separation
from Service.

 

(c)           Separation
Prior to Retirement.  If a
Participant’s Separation from Service is for any reason other than Retirement
or death, then the Participant shall receive a Termination Benefit in a lump
sum as provided in Section 5.1(a).

 

(d)           Effect
of Pre-Retirement Separation from Service on Spousal Survivor Benefits.  Spousal survivor benefits (if any) under Section 5.3
of the Plan shall not be payable to the spouse of a Participant whose
Separation from Service occurs prior to Retirement and receives a Termination
Benefit under this Section 5.1.

 

5.2           Beneficiary
Benefits.

 

(a)            If Participant’s Separation from
Service is due to death, the Company will pay to the Participant’s Beneficiary
in a single lump sum a Beneficiary Benefit that is an amount equal to the value
of the Participant’s Deferral Accounts (other than his or her SEDCP Deferral
Account (if any) and amounts in his or her Early Payment Year Subaccount
attributable to an Early Payment Year beginning before the date of the
Participant’s death (if any)).  If such
Participant also has an SEDCP Deferral Account, the Company will also pay to
the Participant’s Beneficiary annual payments over the greater of (i) 10
years or (ii) until the Participant would have attained age 65 equal to
25% of the amount deferred under the SEDCP (excluding any interest on such
deferrals), which payments shall be in full satisfaction of the benefits
payable 

 

14

 

with respect to the
Participant’s SEDCP Deferral Account. 
Notwithstanding the foregoing, the Participant’s Beneficiary shall
instead be paid the amount credited to the Participant’s SEDCP Deferral Account
as of the end of the month in which his death occurred plus interest at a rate
of 8% per annum, compounded annually, from the end of such month and credited
annually on each anniversary of the end of such month payable in equal
installments (using the Amortization method) over the period described in the
preceding sentence, if the Committee determines that the present value of such
benefit is greater than the present value of the benefit described in the
preceding sentence.  In comparing the present
value of these two alternative benefits, the Committee shall use in each case a
discount factor of 8%.

 

(b)           Notwithstanding
the foregoing, if a Participant’s Separation from Service is due to death after
attaining age 55, payment to his Beneficiary (other than payment of his or her
SEDCP Deferral Account (if any) and amounts in his or her Early Payment Year
Subaccount attributable to an Early Payment Year beginning before the date of
the Participant’s death (if any)) shall be made in the same form as payment of
the Participant’s Retirement Benefit would have been made to the Participant if
he were living.

 

(c)           Notwithstanding
the foregoing, a Participant may elect, on a Beneficiary Distribution Election Form filed
simultaneously with and in the same manner as the first Deferral Election Form that
the Participant is required to file in accordance with the requirements set
forth in Section 4.1 hereof, that, if his Separation from Service is due
to death prior to attaining age 55, payment to his Beneficiary (other than
payment of his or her SEDCP Deferral Account (if any) and amounts in his or her
Early Payment Year Subaccount attributable to an Early Payment Year beginning
before the date of the Participant’s death (if any)) shall be made in any form
and calculated in any other manner described in Section 5.1(b) (which
may be different than the form of payment elected by the Participant for his
Retirement Benefit).  A Participant may
change his election as to the form of payment to his Beneficiary subject to the
following conditions:  (1) the
election shall not be effective until twelve (12) months after the election is
filed with the Committee and (2) the election must be made at least twelve
(12) months prior to the beginning of the calendar year in which the lump sum
payment or initial amount of the installment payment, as the case may be, would
have been payable if no change as to the form of distribution were ever
made.  Each such change must satisfy all
of the requirements of this Section 5.2(c).

 

(d)           If
a Participant dies after Separation from Service but before commencement or
completion of his benefits under the Plan, payment to his Beneficiary shall be
made in the same amount, at the same time and in the same form as payment would
have been made to the Participant if he were living under this Plan.  If installment payments to the Participant
have already commenced, then the remaining installments (if any) shall be paid
to his Beneficiary in the same amounts and at the same times as such remaining
installments would have been paid to the Participant if he were living.

 

(e)           The
payment or payments to a Beneficiary of a deceased Participant under Section 5.2(a),
(b) or (c) (including payments with respect to the SEDCP Deferral Account)
shall be made or commence during the first 90 days of the calendar year
following the year in which the Participant’s death occurred, with any
subsequent installments paid within the first 90 days of each subsequent
calendar year, and the amount of such payment shall be equal to, or determined 

 

15

 

based on, the value of
the Participant’s Deferral Accounts as of the end of the month preceding
payment.

 

(f)            In
the event that the Beneficiary of a deceased Participant dies prior to the
completion of payments under this Plan to that Beneficiary, then the remaining
payments shall be paid to that Beneficiary’s estate in the same amounts and at
the same times as such payments would have been paid to the Beneficiary if he
were living.

 

(g)           Any
election as to the form and manner of payment to a Beneficiary in effect under
the terms of the DCP2 or the 2005 DCP immediately prior to the merger of the
two plans on December 31, 2006, shall remain in effect with respect to the
portions of the applicable Deferral Accounts attributable to amounts deferred
under each plan and shall continue in effect unless or until changed in
accordance with the terms of this Plan. 
The Committee shall establish and maintain separate subaccounts for each
Deferral Account as may be necessary to account for amounts subject to
different beneficiary payout elections.

 

5.3           Spousal
Survivor Benefits with Respect to SEDCP Deferral Accounts.  If a Participant who has an SEDCP Deferral
Account dies after becoming eligible for Retirement or after commencement of
payment of his Retirement Benefit and a spouse to whom he had been married to
for at least one (1) year prior to his death survives beyond completion of
payment of the Participant’s SEDCP Deferral Account balance, the Company shall
pay such spouse a lump sum payment in an amount equal to 10% of the Participant’s
SEDCP Deferral Account balance valued as of the earlier of the date of the
Participant’s Retirement or death.  Such
lump sum spousal survivor benefit shall be paid 120 days following the later of
the completion of payment of the Participant’s SEDCP Deferral Account balance
or the Participant’s death.  No benefit
shall be payable under this Section 5.3 if the Participant’s spouse does
not survive beyond completion of payment of the Participant’s SEDCP Deferral
Account balance.  Notwithstanding the
foregoing, no spousal survivor benefit shall be payable to the spouse of any
Participant who received benefits pursuant to Section 5.1(c) (Termination
Benefit) or Section 5.6 (Immediate Payment on Change in Control).

 

5.4           Early
Payment.  Payment of the amounts
credited to any Early Payment Year Subaccount of a Participant shall be paid or
commence to be paid within the first 90 days of the year elected as the Early
Payment Year in accordance with the Participant’s election under Section 4.1(b),
with any subsequent annual payments paid in the first 90 days of each
applicable year.  The amount of each
annual installment will be determined under the Fractional Method unless the
Participant otherwise irrevocably elects the Amortization Method at the time of
making the Early Payment Benefit election.

 

Notwithstanding the foregoing, if a
Participant has a Separation from Service for any reason prior to the Early
Payment Year elected by the Participant, the election made by the Participant
to receive the Early Payment Benefit shall terminate and the amount credited to
the Participant’s Early Payment Year Subaccount shall be paid, together with
the other amounts credited to the Participant’s Deferral Account, as set forth
in Section 5.1 or 5.2, as the case may be. 
If the Participant has a Separation from Service for any reason after
the start of the Early Payment Year but before the commencement or completion
of the Early Payment Benefit, the benefit or remaining benefit attributable to
the relevant Early Payment Year Subaccount shall be 

 

16

 

paid to the Participant (or his Beneficiary)
in accordance with the Participant’s Early Payment Benefit election without
regard to the Participant’s Separation from Service (i.e., once the Early
Payment Year is reached, the Participant’s subsequent Separation from Service
for any reason shall not affect the payment of the relevant Early Payment Year
Subaccount).

 

5.5           Emergency
Benefit.  In the event that the
Committee, upon written petition of the Participant, determines in its sole
discretion that the Participant has suffered an Unforeseeable Emergency, the
Company shall pay to the Participant, as soon as practicable following such
determination, an Emergency Benefit that does not exceed the amount reasonably
necessary to satisfy such Unforeseeable Emergency plus amounts necessary to pay
taxes reasonably anticipated as a result of the distribution, after taking into
account the extent to which such hardship is or may be relieved through
reimbursement or compensation by insurance or otherwise or by liquidation of
the Participant’s assets to the extent the liquidation of such assets would not
itself cause severe financial hardship and the additional compensation
available to the Participant upon the termination of the Participant’s current
deferral elections under the Plan, as described in the following paragraph of
this Section 5.5.  No amount may be
paid to the Participant under this Section 5.5 from any unvested portion
of the Participant’s Savings Plan Restoration Account.

 

Whenever a Participant receives a
distribution under this Section 5.5, the Participant will be deemed to
have revoked all current deferral elections under the Plan effective as of the
date of the distribution.  The
Participant will not be permitted to participate in the next enrollment period
under the Plan and will be precluded from electing to make new deferrals under
the Plan for a minimum period of one (1) year (or such lesser period as
the Committee may permit) following receipt of the distribution.  Such new election shall comply with the
provisions of Section 4.1(a).

 

5.6           Effect
of Change in Control.  In the event
of a Change in Control, the Board may, in its sole discretion, within the 30
days preceding such Change in Control, irrevocably take action to terminate and
liquidate the Plan, provided that the requirements of Treas. Reg. §
1.409A-3(j)(4)(ix)(B) (or any successor provision) are satisfied.

 

5.7           Small
Benefit.  Notwithstanding any
election by a Participant to receive payment of any account maintained for the
Participant under the Plan in an installment payment form, if the value of such
account is less than $50,000 at the time payment in such form is scheduled to
commence under Section 5.1 or 5.2 (after reduction for any forfeiture
pursuant to Section 4.6), the account shall be paid to the Participant in
a single lump sum on the scheduled commencement date.  This provision shall not apply to (i) any
Early Payment Year Subaccount that is being paid pursuant to an Early Payment
Benefit election or (ii) the Beneficiary benefit with respect to a
Participant’s SEDCP Deferral Account described in Section 5.2(a).

 

5.8           Tax
Withholding and Reporting.

 

(a)            To the extent required by the law in
effect at the time payments are made, the Company shall withhold from payments
made hereunder the taxes required to be withheld by Federal, state and local
law.

 

17

 

(b)           The
Company shall have the right at its option to (i) require a Participant to
pay or provide for payment of the amount of any taxes that the Company may be
required to withhold with respect to interest or other amounts that the Company
credits to a Participant’s Deferral Accounts or (ii) deduct from any
amount of salary, bonus or other payment otherwise payable in cash to the
Participant the amount of any taxes that the Company may be required to
withhold with respect to interest or other amounts that the Company credits to
a Participant’s Deferral Accounts.  In addition, as permitted by Treas. Reg. §
1.409A-3(j)(4)(vi) (or any successor provision), payments may be made
under the Plan to pay any Federal Insurance Contributions Act (FICA) tax
imposed under Code Sections 3101 and 3121(v)(2) on the
Participant’s Deferral Accounts, and to pay any income tax imposed under
Code Section 3401 (i.e.,
wage withholding) or the corresponding withholding provisions of applicable
state or local law as a result of payment of the FICA amount, as well as to pay
the additional income tax attributable to the pyramiding wages and taxes.  The total payment may not exceed the
aggregate FICA tax amount and the income tax withholding related to such FICA
tax amount.

 

5.9                                 Reemployment.

 

(a)           If,
after a Participant’s Separation from Service, such Participant is reemployed
by the Company prior to the payment of his benefits in a cash lump sum payment
or while he is receiving benefits in the form of annual installment payments,
the payment of the lump sum amount or the future installments, as the case may
be, shall be made as scheduled without regard to the Participant’s
reemployment.

 

(b)           A
reemployed Participant may elect to again participate in this Plan and to defer
additional Base Salary and/or Bonus as provided in Section 4.1, in which
case a new Deferral Account shall
be established for such Participant to which allocations relating to the period
following the Participant’s re-employment shall be credited.  The Participant also shall be
permitted to file a new Distribution Election Form, simultaneously with and in
the same manner as the first Deferral Election Form that the Participant
files upon his reemployment, governing the payment of his new Retirement
Benefit in accordance with Section 5.1(b) and payment to his
Beneficiary in accordance with Section 5.2(c) (provided that payment
of any amounts previously forfeited pursuant to Section 4.6 and restored
upon the Participant’s reemployment shall be made in the form applicable at the
time of his prior termination in accordance with the rules set forth
herein).

 

5.10                           Qualified
Divorce Orders.  Subject to the
policies and procedures established by the Committee under Section 9.3(b) hereof
and the provisions of this Plan, benefits may be paid from the balance of a
Participant’s Deferral Account(s) in accordance with a Qualified Divorce
Order.

 

5.11                           Special
2006 Transition Rule Elections.

 

(a)   Notwithstanding anything herein to the
contrary, pursuant to the transition rules under Code Section 409A
and the regulations and guidance thereunder, each Participant who has not
separated from service as of October 12, 2006 may make a new payment
election (a “Special Transition Rule Election”) with respect to (i) the
balance of his Deferral Accounts as of December 31, 2006 together with
interest credited thereto prior to distribution (his “December 31 

 

18

 

Balance”) and/or (ii) any
deferred 2006 bonus (i.e., that portion of any bonus earned in 2006 and payable
in 2007 that the Participant elected to defer under this Plan) plus interest
credited thereto prior to distribution (his “2006 Deferred Bonus”).  As part of such election, the Participant may
elect to receive his Retirement Benefit in any form described in Section 5.1
and calculated under either the Amortization Method or the Fractional
Method.  In addition, the Participant may
elect up to two Early Payment Years with installment payments (if any)
calculated under the Amortization Method or the Fractional Method.  Notwithstanding the provisions of Section 4.1(b) or
Section 5.4 to the contrary, a Participant may elect any Early Payment
Year other than 2006 regardless of the year in which the Compensation was
deferred, except that (i) the earliest Early Payment Year that a
Participant may elect with respect to his 2006 Deferred Bonus is 2008, and (ii) if
a Participant elects 2007 as an Early Payment Year with respect to his December 31
Balance, payment will be made in July of 2007.  A Participant may elect that all, any portion
or no portion of his December 31 Balance and/or all, any portion or no
portion of his 2006 Deferred Bonus be paid in an Early Payment Year, but (i) the
Participant may not select more than two Early Payment Years under this Special
Transition Rule Election and may not elect any additional Early Payment
Years under Section 4.1(b) if such election would result in more than
two scheduled Early Payment Years and (ii) the Participant may not make
different elections with respect to the form or manner of calculation of his
Retirement Benefit with respect to his December 31 Balance and his 2006
Deferred Bonus.

 

(b)   Notwithstanding anything herein to the
contrary, if a Participant has separated from service due to Retirement as of October 12,
2006, he may make a new payment election with respect to his December 31
Balance.  As part of such election, the
Participant may elect (1) to receive a lump sum distribution of his entire
Deferral Account balance in July of 2007 or (2) to change the number
of Retirement Benefit installment payments as permitted under Section 5.1,
provided that the Participant may not extend the number of installments to more
than twenty annual installments (including installment payments that have
already been made).

 

(c)   If a Participant elects 2007 as an Early
Payment Year for his December 31 Balance, he may not elect to defer any
Compensation earned in 2007 under this Plan.

 

(d)   In addition, as part of the special election
under this Section 5.12, a Participant may change the form and manner of
calculation of the payment of benefits to his Beneficiary in the event that the
Participant dies while employed by the Company after becoming eligible for
Retirement.

 

(e)   A Participant must elect the same form and
manner of calculating his Retirement Benefit under (a) or (b) of this
Section 5.12 and the same form and manner of calculating his Beneficiary
Benefit under (d) of this Section 5.12 as he elects for such benefits
under the 2005 DCP and the DCP2.

 

(f)    Any election under this Section 5.12
must be made by November 3, 2006, or such later date as permitted by the
Committee, but in no event later than December 31, 2006.

 

(g)   A Participant’s election under this Section 5.12
shall supersede any previous election made or deemed to be made under this
Plan, the 2005 DCP, or the DCP2.  If a
Participant does not timely make an election under this Section 5.12, the
elections he otherwise 

 

19

 

made or makes or
was deemed to make shall apply and may be changed only in accordance with the
other terms of this Plan and any Compensation deferred on or after January 1,
2007, shall be subject to the Participant’s election under the 2005 DCP (or,
the DCP2 if the Participant was a participant in the DCP2 but not the 2005 DCP)
or as subsequently amended in accordance with the other terms of this
Plan.  However, any distribution election
that had not become effective by October 12, 2006, shall be null and void.

 

5.12                           Section 409A
Compliance.  Notwithstanding anything
herein to the contrary, any amount that would have been paid in 2008 under the
provisions of the Plan as in effect prior to November 1, 2008 shall be
paid by December 31, 2008.  No
amount shall be paid in 2008 under the provisions of this November 1, 2008
restatement that would not have been paid in 2008 under the prior provisions of
the Plan.

 

5.13                           Plan
Provisions Control.

 

(a)           Payment
Commencement Prior to November 1, 2008.  Notwithstanding anything herein to the
contrary, if installment payments to a Participant or Beneficiary have
commenced prior to November 1, 2008 in accordance with the prior
provisions of the Plan, the
Participant’s remaining account shall be paid over the remaining number of
installments in accordance with the rules set forth herein (i.e., within
the first 90 days of 2009 and each subsequent calendar year, except as
otherwise provided herein).

 

(b)           Distribution
Elections Made Prior to November 1, 2008.  Notwithstanding anything herein to the
contrary, if a Participant has made a distribution election, including a
beneficiary distribution election, prior to November 1, 2008, and such
election remains in effect on and after that date, including without limitation
under Section 4.9 or Section 5.2(g), distributions to such
Participant (or his Beneficiary) shall commence and be made in accordance with
the rules set forth herein, with such distribution election used only to
determine the applicable form of payment (i.e., whether distribution shall be
made in a lump sum or installments and, if installments, the number of such
installments and the method used for calculating such installments).

 

ARTICLE
VI

BENEFICIARY DESIGNATION

 

Each Participant shall have the right, at any
time, to designate any person or persons as the Beneficiary to whom payments
under this Plan shall be made in the event of the Participant’s death prior to
complete distribution to the Participant of the benefits due under the
Plan.  Each Beneficiary designation shall
become effective only when filed in writing with the Committee during the
Participant’s lifetime on a paper form prescribed by the Committee.  Any Beneficiary designation made by a
Participant under the DCP2 and/or the 2005 DCP shall continue to apply under
this Plan until the Participant files a new Beneficiary designation form with
the Committee.  Notwithstanding the
preceding sentence, if a Participant had selected different Beneficiaries under
the DCP2 and the 2005 DCP, the following rules shall apply:

 

(A)          If
the Participant does not make a new election under Section 5.12, the
Beneficiary designation under the DCP2 shall apply to the subaccount for the
DCP2 under this 

 

20

 

Plan and the Beneficiary designation under the 2005 DCP shall apply to
the subaccount for the 2005 DCP under this Plan unless or until the Participant
files a new Beneficiary designation form with the Committee.

 

(B)           If
the Participant does make a new election under Section 5.12, the
Participant will be treated as having no Beneficiary designation on file until
the Participant files a new Beneficiary designation with the Committee.

 

The filing of a new Beneficiary designation
form will cancel any inconsistent Beneficiary designation previously filed.

 

If a Participant fails to designate a
Beneficiary as provided above, or if all designated Beneficiaries predecease
the Participant, any benefits remaining unpaid shall be paid in accordance with
the Participant’s Beneficiary designation under the Company’s Retirement Plan,
and if there is no such valid Beneficiary designation, to the Participant’s
then surviving spouse, or if none, to the Participant’s estate, unless directed
otherwise by the court that has jurisdiction over the assets belonging to the
Participant’s probate estate.

 

ARTICLE
VII

CLAIMS PROCEDURE

 

7.1                                 Applications
for Benefits.  All applications for
benefits under the Plan shall be submitted to Occidental Petroleum Corporation,
Attention:  Deferred Compensation Plan
Committee, 10889 Wilshire Blvd., Los Angeles, CA 90024.  Applications for benefits must be in writing
on the forms prescribed by the Committee and must be signed by the Participant,
or in the case of a Beneficiary Benefit, by the Beneficiary or legal
representative of the deceased Participant.

 

7.2                                 Claims
Procedure.

 

(a)           Within
a reasonable period of time, but not later than 90 days after receipt of a
claim for benefits, the Committee or its delegate shall notify the claimant of
any adverse benefit determination on the claim, unless special circumstances
require an extension of time for processing the claim.  In no event may the extension period exceed
90 days from the end of the initial 90-day period.  If an extension is necessary, the Committee
or its delegate shall provide the claimant with a written notice to this effect
prior to the expiration of the initial 90-day period.  The notice shall describe the special
circumstances requiring the extension and the date by which the Committee or
its delegate expects to render a determination on the claim.

 

(b)           In
the case of an adverse benefit determination, the Committee or its delegate
shall provide to the claimant written or electronic notification setting forth
in a manner calculated to be understood by the claimant (i) the specific
reason or reasons for the adverse benefit determination; (ii) reference to
the specific Plan provisions on which the adverse benefit determination is
based; (iii) a description of any additional material or information
necessary for the claimant to perfect the claim and an explanation of why the
material or information is necessary; and (iv) a description of the Plan’s
claim review procedures and the time limits applicable to such procedures,
including a statement of the claimant’s right to bring a civil action 

 

21

 

under Section 502(a) of ERISA following an adverse final
benefit determination on review and in accordance with Section 7.4.

 

(c)           Within
60 days after receipt by the claimant of notification of the adverse
benefit determination, the claimant or his duly authorized representative, upon
written application to the Committee, may request that the Committee fully and
fairly review the adverse benefit determination.  On review of an adverse benefit
determination, upon request and free of charge, the claimant shall have
reasonable access to, and copies of, all documents, records and other
information relevant to the claimant’s claim for benefits.  The claimant shall have the opportunity to
submit written comments, documents, records, and other information relating to
the claim for benefits.  The Committee’s
(or delegate’s) review shall take into account all comments, documents,
records, and other information submitted regardless of whether the information
was previously considered in the initial adverse benefit determination.

 

(d)           Within
a reasonable period of time, but not later than 60 days after receipt of such
request for review, the Committee or its delegate shall notify the claimant of
any final benefit determination on the claim, unless special circumstances
require an extension of time for processing the claim.  In no event may the extension period exceed
60 days from the end of the initial 60-day period.  If an extension is necessary, the Committee
or its delegate shall provide the claimant with a written notice to this effect
prior to the expiration of the initial 60-day period.  The notice shall describe the special
circumstances requiring the extension and the date by which the Committee or
its delegate expects to render a final determination on the request for
review.  In the case of an adverse final
benefit determination, the Committee or its delegate shall provide to the
claimant written or electronic notification setting forth in a manner
calculated to be understood by the claimant (i) the specific reason or
reasons for the adverse final benefit determination; (ii) reference to the
specific Plan provisions on which the adverse final benefit determination is
based; (iii) a statement that the claimant is entitled to receive, upon
request and free of charge, reasonable access to, and copies of, all documents,
records and other information relevant to the claimant’s claim for benefits;
and (iv) a statement of the claimant’s right to bring a civil action under
Section 502(a) of ERISA following an adverse final benefit
determination on review and in accordance with Section 7.4.

 

7.3           Section 409A
Compliance.  Any claim for benefits
under this Article must be made by the claimant no later than the time
prescribed by Treas. Reg. § 1.409A-3(g) (or any successor provision).  If a claimant’s claim or appeal is approved,
any resulting payment of benefits will be made no later than the time
prescribed for payment of benefits by Treas. Reg. § 1.409A-3(g) (or any
successor provision).

 

7.4           Limitations
on Actions.  No legal action may be
commenced prior to the completion of the benefit claims procedure described
herein.  In addition, no legal action may
be commenced after the later of (a) 180 days after receiving the written
response of the Committee to an appeal, or (b) 365 days after an applicant’s
original application for benefits.

 

22

 

ARTICLE
VIII

AMENDMENT AND TERMINATION OF PLAN

 

8.1           Amendment.  The Board may amend the Plan in whole or in
part at any time for any reason, including but not limited to, tax, accounting
or other changes, which may result in termination of the Plan for future
deferrals.  The Executive Compensation
and Human Resources Committee of the Board may amend the Plan to (a) ensure
that this Plan complies with the requirements of Code Section 409A for
deferral of taxation on compensation deferred hereunder until the time of
distribution and (b) add provisions for changes to deferral elections and
elections as to time and manner of distributions and other changes that comply
with the requirements of Code Section 409A for the deferral of taxation on
deferred compensation until the time of distribution.  The Committee appointed pursuant to Article III,
in its discretion, may amend the Plan if the Committee determines that such
amendment does not significantly increase or decrease Plan benefits or
costs.  Notwithstanding the foregoing,
except for any amendment required to preserve the deferral of taxation of
amounts deferred under this Plan, no amendment shall (a) reduce the
amounts that have been credited to the Deferral Account(s) of any
Participant prior to the date such amendment is adopted; (b) eliminate the
spousal survivor benefit under Section 5.3; or (c) change the definition
of the Declared Rate set forth in Article II for the Plan Years beginning
on January 1 of 2006, 2007, or 2008 to a rate or to a formula that, as of
the last day of the month preceding the date such amendment is adopted,
produces a rate that is less than the lesser of:  (i) Moodys Plus Three (as defined in Article II
and calculated as of the last day of the month preceding the date such
amendment is adopted), or (ii) the highest yield on any unsecured debt or
preferred stock of the Company that was outstanding on the last day of the
month immediately preceding the date such amendment is adopted.  Any amendment that would either (a) reduce
the Declared Rate for the Plan Years beginning on January 1 of 2006, 2007,
or 2008 to a rate or to a formula that, as of the last day of the month
preceding the date such amendment is adopted, produces a rate that is less than
Moodys Plus Three (as defined in Article II and calculated as of the last
day of the month preceding the date such amendment is adopted) or (b) change
the terms of the amendment provisions of this Section 8.1 or the terms of
the termination provisions of Section 8.2, shall not be effective prior to
the date that is two years after the date such amendment is adopted, unless the
amendment is required by a change in the tax or other applicable laws or
accounting rules, or the amendment is required in order to preclude any amounts
deferred under this Plan from being included in the income of Participants
prior to a date of distribution as specified under this Plan.  Notwithstanding the foregoing, following a
Change in Control, no amendment shall (a) reduce the amounts that have
been credited to the Deferral Account(s) of any Participant prior to the
date such amendment is adopted; (b) change the definition of the Declared
Rate set forth in Article II for the Plan Years beginning on January 1
of 2006, 2007, or 2008 to a rate or to a formula that, as of the last day of
the month preceding the date of the Change in Control, produces a rate that is
less than Moodys Plus Three (as defined in Article II and calculated as of
the last day of the month preceding the date of the Change in Control); (c) eliminate
the spousal survivor benefits under Section 5.3; or (d) change the
terms of the amendment provisions of this Section 8.1 or the terms of the
termination provisions of Section 8.2.

 

23

 

8.2                                 Termination.

 

(a)           Company’s
Right to Terminate.  The Board may
terminate the Plan at any time, if in the Board’s judgment, the continuance of
the Plan would not be in the Company’s best interest due to tax, accounting or
other effects thereof, or potential payouts thereunder, or other reasons,
provided that any termination of the Plan shall not be effective prior to the
date that is two years after the date the Board adopts a resolution to
terminate the Plan, unless (i) the termination of the Plan is required by
a change in the tax or other applicable laws or accounting rules, or (ii) the
Participants have become subject to tax on the amounts deferred under the
Plan.  Notwithstanding the foregoing,
following a Change in Control, the Plan may not be terminated prior to the date
that is three years after the date the Change in Control occurs, or, if
earlier, the date on which amounts deferred under the Plan have become taxable
to Participants.  In the event the Board
adopts a resolution terminating the Plan, the Board or the Committee shall
determine the date as of which deferral elections shall cease to have effect in
accordance with the requirements of Code Section 409A.

 

(b)           Payments
Upon Termination.  Distributions to
the Participants or their Beneficiaries shall be made on the dates on which the
Participants or their Beneficiaries would receive benefits hereunder without
regard to the termination of the Plan, except that payments may, in the discretion of the Board, be
accelerated if:

 

(A)          The
Plan is terminated and liquidated pursuant to Section 5.6 of the Plan;

 

(B)           Accelerated
payment is otherwise permitted by Treas. Reg. § 1.409A-3(j)(4)(ix) (or any
successor provision) or other guidance issued by the Secretary of the Treasury,
or

 

(C)           The
Plan is terminated because Participants have become subject to tax on their
deferrals due to the Plan’s failure to satisfy the requirements of Code Section 409A.  Payment to a Participant may not exceed the
amount required to be included in income as a result of such failure.

 

ARTICLE
IX

MISCELLANEOUS

 

9.1                                 Unsecured
General Creditor.  The rights of a
Participant, Beneficiary, or their heirs, successors, and assigns, as relates
to any Company promises hereunder, shall not be secured by any specific assets
of the Company, nor shall any assets of the Company be designated as
attributable or allocated to the satisfaction of such promises.

 

9.2                                 Trust
Fund.  The Company shall be
responsible for the payment of all benefits provided under the Plan.  At its discretion, the Company may establish
one or more trusts, with such trustees as the Board or Committee may approve,
for the purpose of providing for the payment of such benefits.  Such trust or trusts may be irrevocable, but
the assets thereof shall be subject to the claims of the Company’s
creditors.  To the extent any benefits
provided under the Plan are actually paid from any such trust, the Company
shall have no further obligation with respect thereto, but to the extent not so
paid, such benefits shall remain the obligation of, and 

 

24

 

shall be paid by, the
Company.  No assets shall be transferred to a trust if
such transfer would result in the taxation of benefits prior to distribution
under Code Section 409A(b).

 

9.3                                 Nonassignability.

 

(a)           Neither
a Participant nor any other person shall have any right to commute, sell,
assign, transfer, pledge, anticipate, mortgage or otherwise encumber,
hypothecate or convey in advance of actual receipt the amounts, if any, payable
hereunder, or any part thereof, or interest therein which are, and all rights
to which are, expressly declared to be unassignable and non-transferable.  No part of the amounts payable shall, prior
to actual payment, be subject to seizure or sequestration for the payment of
any debts, judgments, alimony or separate maintenance owed by a Participant or
any other person, nor be transferable by operation of law in the event of a
Participant’s or any other person’s bankruptcy or insolvency.

 

(b)           Notwithstanding
subsection (a), the right to benefits payable with respect to a Participant
pursuant to a Qualified Divorce Order may be created, assigned, or
recognized.  The Committee shall
establish appropriate policies and procedures to determine whether a Divorce
Order presented to the Committee constitutes a Qualified Divorce Order under
this Plan, and to administer distributions pursuant to the terms of Qualified
Divorce Orders.  In the event that a
Qualified Divorce Order exists with respect to benefits payable under the Plan,
such benefits otherwise payable to the Participant specified in the Qualified
Divorce Order shall be payable to the Alternate Payee specified in such
Qualified Divorce Order.

 

9.4                                 Release from Liability to Participant.  A
Participant’s right to receive benefits under the Plan shall be reduced to the
extent that any portion of a Participant’s Deferral Account(s) has been
paid or set side for payment to an Alternate Payee pursuant to a Qualified
Divorce Order.  The Participant shall be
deemed to have released the Company and the Plan from any claim with respect to
such amounts in any case in which (a) the Company, the Plan, or any Plan
representative has been served with legal process or otherwise joined in a
proceeding relating to such amounts, and (b) the Participant fails to
obtain an order of the court in the proceeding relieving the Company and the
Plan from the obligation to comply with the judgment, decree or order.

 

9.5                                 Employment
Not Guaranteed.  Nothing contained in
this Plan nor any action taken hereunder shall be construed as a contract of
employment or as giving any Participant any right to be retained in employment
with the Company.  Accordingly, subject
to the terms of any written employment agreement to the contrary, the Company
shall have the right to terminate or change the terms of employment of a
Participant at any time and for any reason whatsoever, with or without cause.

 

9.6                                 Gender,
Singular & Plural.  All
pronouns and any variations thereof shall be deemed to refer to the masculine
or feminine as the identity of the person or persons may require.  As the context may require, the singular may
be read as the plural and the plural as the singular.

 

9.7                                 Captions.  The captions of the articles, sections, and
paragraphs of the Plan are for convenience only and shall not control or affect
the meaning or construction of any of its provisions.

 

25

 

9.8                                 Validity.  In the event any provision of this Plan is
held invalid, void, or unenforceable, the same shall not affect, in any respect
whatsoever, the validity of any other provision of this Plan.

 

9.9                                 Notice.  Any notice or filing required or permitted to
be given to the Committee under the Plan shall be sufficient if in writing and
hand delivered, or sent by registered or certified mail, to the principal
office of the Company.  Such notice shall
be deemed given as to the date of delivery or, if delivery is made by mail, as
of the date shown on the postmark on the receipt for registration or
certification.

 

9.10                           Applicable
Law.  The Plan shall be governed by
and construed in accordance with Code Section 409A, and any regulations
promulgated thereunder, and in accordance with the laws of the State of
California to the extent such laws are not preempted by ERISA.

 

 

IN WITNESS
WHEREOF, Occidental Petroleum Corporation has executed this document this       
day of                     ,
2008.

 

 

	
   

  	
  OCCIDENTAL
  PETROLEUM CORPORATION

  	
   

  
	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By 

  	
   

  	
   

  
	
   

  	
   

  	
    Martin A. Cozyn

  
	
   

  	
   

  	
    Executive Vice-President, Human Resources

  
					

 

26

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