Document:

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                                                                    EXHIBIT 10.2
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                    OCCIDENTAL PARTNER SUB PURCHASE AGREEMENT

                                      AMONG

                           LYONDELL CHEMICAL COMPANY,

                    OCCIDENTAL CHEMICAL HOLDING CORPORATION,

                               OXY CH CORPORATION

                                       AND

                         OCCIDENTAL CHEMICAL CORPORATION

                                  July 8, 2002

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                               TABLE OF CONTENTS
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                                                                            Page

<S>                                                                        <C>
SECTION 1 COVENANTS REGARDING PRE-CLOSING RESTRUCTURING .....................  2
     1.1  Pre-Closing Restructuring .........................................  2
     1.2  Organization, Capitalization, Title ...............................  2
SECTION 2 PURCHASE AND SALE OF THE OCCIDENTAL PARTNER SUBS ..................  2
     2.1  Sale of the Occidental Partner Subs ...............................  2
     2.2  Purchase Price ....................................................  3
SECTION 3 CLOSING DATE, PAYMENT AND DELIVERY ................................  3
     3.1  Closing Date ......................................................  3
     3.2  Payment and Delivery ..............................................  3
     3.3  Payments of Cash; Delivery of Certificates ........................  3
SECTION 4 REPRESENTATIONS AND WARRANTIES OF OCCIDENTAL PARTIES ..............  4
     4.1  Organization, Good Standing and Power .............................  4
     4.2  Authorization and Validity of Agreements ..........................  4
     4.3  Lack of Conflicts .................................................  4
     4.4  Certain Fees ......................................................  5
     4.5  Occidental Partner Subs ...........................................  5
     4.6  Partnership Units .................................................  6
     4.7  Tax Matters .......................................................  7
SECTION 5 REPRESENTATIONS AND WARRANTIES OF THE PURCHASER ...................  8
     5.1  Organization, Good Standing and Power .............................  8
     5.2  Authorization and Validity of Agreement ...........................  9
     5.3  Lack of Conflicts .................................................  9
     5.4  Certain Fees ......................................................  9
     5.5  Financing ......................................................... 10
     5.6  Investment ........................................................ 10
     5.7  Investigation; No General Solicitation ............................ 10
     5.8  Sophistication and Financial Condition of Purchaser ............... 10
SECTION 6 ADDITIONAL AGREEMENTS ............................................. 10
     6.1  Conduct of Occidental Business Pending the Closing Date ........... 10
     6.2  Further Actions ................................................... 11
     6.3  Notifications ..................................................... 12
     6.4  No Inconsistent Action ............................................ 12
     6.5  Preservation of Corporate Existence of Oxy LP2 .................... 13
     6.6  Release ........................................................... 13
     6.7  [Intentionally Omitted] ........................................... 13
     6.8  Agreement Regarding OCC Indemnity ................................. 13
     6.9  Indemnity and Other Agreements Regarding Potential Loss
          of Units Under Section 14 of the Partnership Agreement ............ 13
SECTION 7 ADDITIONAL AGREEMENTS REGARDING CERTAIN TAX MATTERS ............... 16
     7.1  Absence of Section 338(h)(10) Election ............................ 16
     7.2  Absence of Tax Election As to Oxy LP1 ............................. 16
     7.3  Tax Indemnification ............................................... 16
     7.4  Tax Indemnification Duration ...................................... 16
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<TABLE>
<S>                                                                        <C>
     7.5   Straddle Periods ................................................  16
     7.6   Responsibility for Filing Tax Returns for Periods through
           Closing Date ....................................................  17
     7.7   Cooperation on Tax Matters ......................................  17
     7.8   Tax Sharing Agreements ..........................................  18
     7.9   Certain Taxes and Fees ..........................................  18
     7.10  Audits ..........................................................  18
     7.11  Carrybacks ......................................................  18
     7.12  Post Closing Elections ..........................................  18
     7.13  Consistent Tax Treatment ........................................  19
     7.14  Refunds .........................................................  19
SECTION 8  CONDITIONS TO CLOSING ...........................................  19
     8.1   Conditions Precedent to Obligations of Both Parties .............  19
     8.2   Conditions Precedent to Obligations of Occidental Parties .......  19
     8.3   Conditions Precedent to Obligations of the Purchaser ............  20
SECTION 9  TERMINATION .....................................................  21
     9.1   General .........................................................  21
     9.2   Effect of Termination ...........................................  22
SECTION 10 SURVIVAL AND INDEMNIFICATION ....................................  22
     10.1  Survival ........................................................  22
     10.2  Indemnification by the Purchaser ................................  23
     10.3  Indemnification by the Occidental Parties .......................  23
     10.4  Mutual Indemnity ................................................  24
     10.5  Mitigation; Limitation on Consequential, Punitive and
             Exemplary Damages; Exclusive Remedy ...........................  24
     10.6  EXTENT OF INDEMNIFICATION .......................................  25
     10.7  Procedures ......................................................  25
     10.8  Termination of Indemnification ..................................  27
SECTION 11 MISCELLANEOUS ...................................................  28
     11.1  Successors and Assigns ..........................................  28
     11.2  Benefits of Agreement Restricted to Parties .....................  28
     11.3  Notices .........................................................  28
     11.4  Severability ....................................................  29
     11.5  Press Releases ..................................................  29
     11.6  Confidentiality Agreement .......................................  30
     11.7  Entire Agreement ................................................  30
     11.8  Construction ....................................................  30
     11.9  Counterparts ....................................................  31
     11.10 Governing Law ...................................................  31
     11.11 Transaction Costs ...............................................  31
     11.12 Amendment .......................................................  31
     11.13 Jurisdiction; Consent to Service of Process; Waiver .............  31
     11.14 Waiver of Jury Trial ............................................  32
     11.15 Special Joinder by Oxy LP2 ......................................  32
     11.16 Special Joinder by Occidental ...................................  32
     11.17 Further Assurances ..............................................  32
</TABLE>
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APPENDIX

Appendix A        Definitions

SCHEDULES

Schedule 1.2      Organization, Capitalization, Title
Schedule 2.2      Allocation of Purchase Price
Schedule 4        Exceptions to Representations and Warranties of Occidental
                  Parties
Schedule 4.5      Organization, Capitalization, Title
Schedule 4.6      Partnership Units
Schedule 4.7(c)   Tax Returns - Filings and Audits
Schedule 4.7(e)   Tax Basis
Schedule 4.7(f)   Tax Returns
Schedule 4.7(h)   Payment of Taxes
Schedule 5        Exceptions to Representations and Warranties of the Purchaser
Schedule 5.5      Financing
Schedule 8.2(d)   Occidental Consents
Schedule 8.3(e)   Purchaser Consents

EXHIBITS

Exhibit A         Form of Escrow Agreement
Exhibit B         Form of Option to Sell Petrochemical Plant Agreement
Exhibit C         Form of $75 Million Note

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                    OCCIDENTAL PARTNER SUB PURCHASE AGREEMENT

     This OCCIDENTAL PARTNER SUB PURCHASE AGREEMENT (this "Agreement"), dated
July 8, 2002, is entered into by and among Lyondell Chemical Company, a Delaware
corporation (the "Purchaser"), Occidental Chemical Holding Corporation, a
California corporation ("OCHC"), Oxy CH Corporation, a California corporation
("Oxy CH"), and Occidental Chemical Corporation, a New York corporation ("OCC").

     The definitions of capitalized terms used in this Agreement
are set forth in Appendix A.

                                    RECITALS

     WHEREAS, Oxy CH and OCC are each indirect wholly owned subsidiaries of
OCHC;

     WHEREAS, OCC owns all of the outstanding capital stock of Occidental
Petrochem Partner 1, Inc., a Delaware corporation ("Oxy LP1");

     WHEREAS, Oxy CH owns all of the outstanding capital stock of each of
Occidental Petrochem Partner 2, Inc., a Delaware corporation ("Oxy LP2"), and
Occidental Petrochem Partner GP, Inc., a Delaware corporation ("Oxy GP" and
together with Oxy LP1 and Oxy LP2, the "Occidental Partner Subs");

     WHEREAS, the Occidental Partner Subs hold, in the aggregate, a 29.5%
partnership interest in Equistar Chemicals, LP, a Delaware limited partnership
(the "Partnership");

     WHEREAS, Oxy CH and OCC are the Occidental Parent referred to in the Parent
Agreement for purposes of Section 2 of the Parent Agreement (the "Occidental
Parent");

     WHEREAS, Lyondell and Millennium are each a "Parent" for purposes of the
Parent Agreement;

     WHEREAS, Section 2.2 of the Parent Agreement provides a right of first
option for Lyondell and Millennium to purchase a pro-rata portion of the Partner
Sub Stock;

     WHEREAS, Millennium did not elect to purchase its pro-rata portion of the
Partner Sub Stock and Lyondell elected to purchase all of the Partner Sub Stock;
and

     WHEREAS, the Occidental Parent desires to Transfer all of the Partner Sub
Stock to the Purchaser upon the terms and subject to the conditions hereinafter
set forth;

     NOW, THEREFORE, in consideration of the premises and the mutual covenants
of the Parties set forth herein, it is hereby agreed as follows:

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                                    SECTION 1
                  COVENANTS REGARDING PRE-CLOSING RESTRUCTURING

     1.1  Pre-Closing Restructuring. Prior to Closing, OCC shall cause Oxy LP1
to convert into a Delaware limited liability company.

     1.2  Organization, Capitalization, Title. The Occidental Parties covenant
that as of Closing:

          (a) The name, form of entity and jurisdiction of incorporation or
     organization of Oxy LP1 will be as set forth on Schedule 1.2. True, correct
     and complete copies of the limited liability company organizational
     documents for Oxy LP1 will be delivered to the Purchaser prior to Closing.

          (b) The capitalization of Oxy LP1 will be as set forth on Schedule
     1.2. The respective limited liability company interests set forth thereon
     will constitute all the outstanding ownership interests of Oxy LP1. The Oxy
     LP1 Interests, Oxy LP2 Shares and Oxy GP Shares collectively will represent
     100% of Occidental's ownership interest in the Partnership.

          (c) All of the Oxy LP1 Interests will be owned beneficially and of
     record by OCC. All Oxy LP1 Interests will be duly authorized and validly
     issued in accordance with its governing or organizational documents, and
     will be fully paid and nonassessable (except as such nonassessability may
     be affected by Section 18-607 of the Limited Liability Company Act of the
     State of Delaware) and none of the Oxy LP1 Interests will have been issued
     in violation of any preemptive rights.

          (d) OCC will own all of the limited liability company interests set
     forth in Schedule 1.2 free and clear of all Encumbrances, and such
     interests will not be subject to any agreements or understandings with
     respect to the voting, ownership or Transfer thereof. There will not be
     outstanding subscriptions, options, convertible securities, warrants or
     calls of any kind issued or granted by, or binding upon, any Occidental
     Party or its Affiliates to purchase or otherwise acquire or to sell or
     otherwise dispose of any security or equity interest of Oxy LP1.

          (e) OCC will have full legal right to Transfer the Oxy LP1 Interests
     to the Purchaser or one or more of its Affiliates.

                                   SECTION 2
                PURCHASE AND SALE OF THE OCCIDENTAL PARTNER SUBS

     2.1  Sale of the Occidental Partner Subs. At Closing:

          (a) OCC shall Transfer and deliver to the Purchaser, or to one or more
     Affiliates of the Purchaser designated in writing by the Purchaser, all of
     the Oxy LP1 Interests and the Purchaser (or such Affiliate or Affiliates)
     shall purchase and acquire all of the Oxy LP1 Interests from OCC; and

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          (b) Oxy CH shall Transfer and deliver to the Purchaser, or to one or
     more Affiliates of the Purchaser designated in writing by the Purchaser,
     all of the Oxy LP2 Shares and the Oxy GP Shares and the Purchaser (or such
     Affiliate or Affiliates) shall purchase and acquire all of the Oxy LP2
     Shares and the Oxy GP Shares from Oxy CH.

     2.2  Purchase Price. The aggregate purchase price payable to OCC and Oxy CH
by the Purchaser for the Partner Sub Stock shall be $440,010,000. Such aggregate
purchase price shall be allocated between OCC and Oxy CH as set forth on
Schedule 2.2.

                                   SECTION 3
                       CLOSING DATE, PAYMENT AND DELIVERY

     3.1  Closing Date. The Closing shall be held at the offices of Baker Botts
L.L.P. in Houston, Texas at 10:00 a.m. on (i) August 30, 2002, or (ii) if all
conditions set forth in Sections 8.1, 8.2 and 8.3, other than conditions to be
satisfied at Closing, have not been satisfied or waived by that date, on the
third Business Day after the first day all such conditions have been satisfied
or waived or (iii) on such other date as may be agreed to in writing by the
Parties (the "Closing Date").

     3.2  Payment and Delivery. At Closing:

          (a) the Purchaser shall, or shall cause its Affiliates to, transmit
     the portion of the aggregate purchase price allocated to OCC and Oxy CH in
     Schedule 2.2 to OCC and Oxy CH, respectively,

          (b) OCC shall deliver to the Purchaser a certificate representing the
     Oxy LP1 Interests purchased hereunder (together with a stock power executed
     in blank and any other appropriate documentation to a similar effect as
     reasonably requested by the Purchaser) and

          (c) Oxy CH shall deliver to the Purchaser certificates representing
     the Oxy GP Shares and the Oxy LP2 Shares purchased hereunder (together in
     each case with stock powers executed in blank and any other appropriate
     documentation to a similar effect as reasonably requested by the
     Purchaser).

     3.3  Payments of Cash; Delivery of Certificates. Any funds required to be
paid hereunder shall be made by wire transfer of immediately available funds to
an account designated by the intended recipient of such funds in writing. Any
Partner Sub Stock certificates delivered hereunder shall be duly registered in
the name of the intended recipient and shall bear the legend set forth in
Section 2.1(b) of the Parent Agreement.

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                                    SECTION 4
              REPRESENTATIONS AND WARRANTIES OF OCCIDENTAL PARTIES

          Except as set forth on Schedule 4, the Occidental Parties jointly and
severally represent and warrant to the Purchaser as follows:

     4.1  Organization, Good Standing and Power. Each Occidental Party (i) is a
corporation duly incorporated, validly existing and in good standing under the
laws of the jurisdiction of its incorporation and has the corporate power and
authority to own, lease and operate its assets and to conduct its business as
now being conducted by it, (ii) is duly authorized, qualified or licensed to do
business as a foreign corporation in, and is in good standing in, each of the
jurisdictions in which its right, title or interest in or to any of the assets
held by it or the business conducted by it, requires such authorization,
qualification or licensing, except where the failure to be so authorized,
qualified, licensed or in good standing would not be reasonably likely to have
an Occidental Material Adverse Effect and (iii) has all requisite corporate
power and authority to enter into this Agreement and to perform its obligations
hereunder.

     4.2  Authorization and Validity of Agreements.

          (a) The execution, delivery and performance by each Occidental Party
     of this Agreement and the consummation by each such Party of the
     transactions contemplated hereby have been duly authorized and approved by
     all necessary corporate or similar action on its part. This Agreement has
     been duly and validly executed and delivered by each Occidental Party and
     is its legal, valid and binding obligation, enforceable against each such
     Party in accordance with its terms, except as the same may be limited by
     applicable bankruptcy, insolvency, reorganization, moratorium or other laws
     related to or affecting creditors' rights generally and by general equity
     principles.

          (b) The execution, delivery and performance by each Occidental Party
     of the Related Purchase Agreements to which it will be a party and the
     consummation by each such Occidental Party of the transactions contemplated
     thereby will be, as of the Closing, duly authorized and approved by all
     necessary corporate action on its part. At the Closing, each of the Related
     Purchase Agreements to which an Occidental Party will be a party will be
     duly and validly executed and delivered by it and will be upon execution
     and delivery its legal, valid and binding obligation, enforceable against
     it in accordance with its terms, except as the same may be limited by
     applicable bankruptcy, insolvency, reorganization, moratorium or other laws
     related to or affecting creditors' rights generally and by general equity
     principles.

     4.3  Lack of Conflicts. Execution, delivery and, assuming receipt of the
Consents contemplated by Schedule 8.2(d), performance by each Occidental Party
of this Agreement and the Related Purchase Agreements to which it is or will be
a party and the consummation by each such party of the transactions contemplated
hereby and thereby does not and, as of the Closing, will not (i) violate (with
or without the giving of notice or the lapse of time or both) any Legal
Requirement applicable to any of them or any of their Subsidiaries or to
Occidental, other than those that would not be reasonably likely to have an
Occidental Material Adverse Effect, (ii)

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conflict with, or result in the breach of, any provision of the charter or
by-laws or similar governing or organizational documents of any of them or any
of their Subsidiaries, (iii) result in the creation of any Encumbrance upon any
of their assets, other than those arising under this Agreement or those that
would not be reasonably likely to have an Occidental Material Adverse Effect or
(iv) violate, conflict with or result in the breach or termination of or
otherwise give any other Person the right to terminate, or constitute a default,
event of default or an event that with notice, lapse of time or both, would
constitute a default or event of default under the terms of, any contract,
indenture, lease, mortgage, Government License or other agreement or instrument
to which any of them or any of their Subsidiaries or Occidental is a party or by
which the properties or businesses of any of them or any of their Subsidiaries
are bound, except for violations, conflicts, breaches, terminations and defaults
that would not be reasonably likely to have an Occidental Material Adverse
Effect.

     4.4  Certain Fees. No Occidental Party nor any of its Affiliates nor any of
its officers, directors or employees, on behalf of it or such Affiliates, has
employed any broker or finder or incurred any other liability for any financial
advisory fees, brokerage fees, commissions or finders' fees in connection with
the transactions contemplated hereby.

     4.5  Occidental Partner Subs.

          (a) The name, form of entity and jurisdiction of incorporation or
     organization of each Occidental Partner Sub as of the date of this
     Agreement are set forth on Schedule 4.5. True, correct and complete copies
     of the charter and bylaws or comparable organizational documents for each
     Occidental Partner Sub have been delivered to the Purchaser.

          (b) The capitalization of each Occidental Partner Sub as of the date
     of this Agreement is as set forth on Schedule 4.5. The respective shares
     set forth thereon constitute all the outstanding capital stock of each such
     Occidental Partner Sub, as of the dates indicated thereon. The Oxy LP1
     Shares, Oxy LP2 Shares and Oxy GP Shares collectively represent 100% of
     Occidental's ownership interest in the Partnership.

          (c) As of the date of this Agreement, (i) Oxy LP1 Shares are owned
     beneficially and of record by OCC and (ii) the Oxy LP2 Shares and Oxy GP
     Shares are owned beneficially and of record by Oxy CH. All Partner Sub
     Stock is duly authorized, validly issued, fully paid and nonassessable and
     none of the Partner Sub Stock was issued in violation of any preemptive
     rights.

          (d) OCC and Oxy CH own all of the shares of Partner Sub Stock as set
     forth in Section 4.5(c) free and clear of all Encumbrances, and such shares
     are not subject to any agreements or understandings with respect to the
     voting, ownership or Transfer thereof. There are no outstanding
     subscriptions, options, convertible securities, warrants or calls of any
     kind issued or granted by, or binding upon, any Occidental Party or any of
     its Affiliates to purchase or otherwise acquire or to sell or otherwise
     dispose of any security or equity interest in any of the Occidental Partner
     Subs.

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          (e) OCC and Oxy CH have full legal right, respectively, to Transfer
     the Oxy LP1 Shares, Oxy LP2 Shares and Oxy GP Shares to the Purchaser (or
     one or more of its Affiliates).

          (f) Except for any liability of Oxy GP arising under Delaware law
     because it is a general partner of the Partnership, in the case of each
     Occidental Partner Sub, (A) its business is and, since its incorporation,
     has been restricted solely to the holding of its Units and the doing of
     things necessary or incidental in connection therewith (including the
     exercise of its rights and powers under the Partnership Agreement), (B) it
     does not and, since its incorporation, has not, owned any assets, incurred
     any liabilities or engaged, participated or invested in any business
     outside the scope of the business set forth in (A), (C) it does not and,
     since its incorporation, has not, had any employees, (D) it does not have
     any outstanding debt obligations, including any permitted under Section 2.4
     of the Parent Agreement, (E) it is not a party to any contracts or
     agreements and (F) except as provided in Section 6.8, it has not incurred
     any other liabilities that remain outstanding.

          (g) In the case of the Occidental Partner Subs, taken together, (A) to
     the Knowledge of each Occidental Party, no Occidental Partner Sub has any
     liabilities or obligations of any nature, whether or not fixed, accrued,
     contingent or otherwise, except liabilities and obligations that do not or
     are not reasonably likely to have, individually or in the aggregate, an
     Occidental Material Adverse Effect and (B) there are no Proceedings pending
     or to any Occidental Party's Knowledge, threatened, involving any
     Occidental Partner Sub that could reasonably be expected to have an
     Occidental Material Adverse Effect and no Occidental Party has Knowledge of
     any judgment, order writ, injunction or decree of any Authority against or
     involving any Occidental Partner Sub. No Occidental Partner Sub is, or with
     the giving of notice or lapse of time or both would be, in violation of or
     in default under its charter or by-laws or similar governing or
     organizational documents or any contract, indenture, lease, mortgage,
     Government License or other agreement or instrument to which such
     Occidental Partner Sub is a party or by which it or any of its properties
     is bound, except for violations and defaults that individually and in the
     aggregate would not be reasonably likely to have an Occidental Material
     Adverse Effect.

     4.6  Partnership Units. Each Occidental Partner Sub owns beneficially and
of record the Units set forth opposite its name on Schedule 4.6 and the
partnership interests that relate thereto free and clear of all Encumbrances,
and such Units and related partnership interests are not subject to any
agreements or understandings with respect to the voting, ownership or Transfer
thereof or with respect to any other rights of a partner of the Partnership
holding such Units under the Partnership Agreement. There are no outstanding
subscriptions, options, convertible securities, warrants or calls of any kind
issued or granted by, or binding upon, any Occidental Party or any of its
Affiliates to purchase or otherwise acquire or to sell or otherwise dispose of
the Units or the related partnership interests.

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     4.7  Tax Matters.

          (a) Each Occidental Partner Sub has filed all Tax Returns that it was
     required to file under applicable laws and regulations. All such Tax
     Returns were correct and complete in all respects and have been prepared in
     substantial compliance with all applicable laws and regulations. All Taxes
     due and owing by any Occidental Partner Sub (whether or not shown on any
     Tax Return) have been paid. There are no liens for Taxes (other than Taxes
     not yet due and payable) upon any of the assets of any Occidental Partner
     Sub.

          (b) Each Occidental Partner Sub has withheld and paid all Taxes
     required to have been withheld and paid in connection with any amounts paid
     or owing to any employee, independent contractor, creditor, stockholder or
     other third party.

          (c) No Occidental Partner Sub has reason to expect that any Authority
     will assess an Occidental Partner Sub for additional Taxes (other than
     Taxes attributable to its interest in the Partnership) for any period for
     which Tax Returns have been filed. No Occidental Partner Sub has received
     from any foreign, federal, state or local taxing Authority (including
     jurisdictions where any Occidental Partner Sub has not filed Tax Returns)
     any notice of deficiency or proposed adjustment for any amount of Tax
     proposed, asserted, or assessed by any taxing Authority against any
     Occidental Partner Sub (other than Tax attributable to its interest in the
     Partnership). The Occidental Parties or their Affiliates have delivered to
     the Purchaser correct and complete copies of all federal income Tax
     Returns, examination reports, and statements of deficiencies assessed
     against or agreed to by any Occidental Partner Sub filed or received since
     its formation.

          (d) No Occidental Partner Sub has filed a consent underss.341(f) of
     the Code concerning collapsible corporations.

          (e) To the Knowledge of the Occidental Parties, the correct aggregate
     tax basis (as determined solely for federal income tax purposes) of the
     properties that have been contributed to the Partnership by Oxy GP and Oxy
     LP2 (or their predecessors in interest) is at least 95% of the aggregate
     tax basis amount reported to the Partnership. Schedule 4.7(e) sets forth
     the following information (as determined solely for federal income tax
     purposes) with respect to each Occidental Partner Sub as of the most recent
     practicable date: (i) the basis of each Occidental Partner Sub in each of
     its assets other than its interest in the Partnership; (ii) the amount of
     any net operating loss, net capital loss, unused investment or other
     credit, unused foreign tax, or excess charitable contribution allocable to
     any Occidental Partner Sub; and (iii) the amount of any deferred gain or
     loss allocable to any Occidental Partner Sub arising out of any
     intercompany transaction, other than such deferred gains or losses included
     in the income of an Occidental Partner Sub in a tax year ending on or
     before the Closing Date.

          (f) Each Occidental Partner Sub has amended or will amend its federal
     income Tax Returns corresponding exactly to the information provided to
     such Occidental Partner Sub by the Partnership.

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          (g) Other than because of such items being reported by the
     Partnership, Oxy LP2 will not be required to include any item of income in
     taxable income for any taxable period (or portion thereof) ending after the
     Closing Date as a result of any: (i) change in method of accounting for a
     taxable period ending on or prior to the Closing Date; (ii) "closing
     agreement" as described in Section 7121 of the Code (or any corresponding
     or similar provision of state, local or foreign income Tax law) executed on
     or prior to the Closing Date; (iii) intercompany transactions or any excess
     loss account described in Treasury Regulations under Section 1502 of the
     Code (or any corresponding or similar provision of state, local or foreign
     income Tax law); (iv) installment sale or open transaction disposition made
     on or prior to the Closing Date; or (v) prepaid amount received on or prior
     to the Closing Date.

          (h) Each Affiliated Group of which any Occidental Partner Sub is or
     was a member (each an "Occidental Affiliated Group") has filed all income
     Tax Returns that it was required to file for each taxable period during
     which any Occidental Partner Sub was a member of such group. Any tax shown
     as due on such returns as owing has been paid. With respect to the items on
     such Occidental Affiliated Group Tax Returns specifically concerning any
     Occidental Partner Sub, other than items for which such Tax Returns are
     filed or amended in accordance with information provided by the
     Partnership, there is no dispute or claim either (i) claimed or raised by
     any authority in writing or (ii) as to which any Occidental Party or its
     Affiliate has Knowledge based upon personal contact with any agent of such
     authority.

          (i) None of the Occidental Partner Subs has any liability for the
     Taxes of any other Person under Treasury Regulation Section 1.1502-6 (or
     any similar provision of state, local or foreign law).

                                   SECTION 5
                 REPRESENTATIONS AND WARRANTIES OF THE PURCHASER

          Except as set forth on Schedule 5, the Purchaser represents and
warrants to the Occidental Parties that:

     5.1  Organization, Good Standing and Power. The Purchaser (i) is a
corporation duly organized, validly existing and in good standing under the laws
of the state of Delaware and has the corporate power and authority to own, lease
and operate its assets and to conduct its business as now being conducted by it,
(ii) is duly authorized, qualified or licensed to do business as a foreign
corporation in, and is in good standing in, each of the jurisdictions in which
its right, title or interest in or to any of the assets held by it or the
business conducted by it, requires such authorization, qualification or
licensing, except where the failure to be so authorized, qualified, licensed or
in good standing would not be reasonably likely to have a Purchaser Material
Adverse Effect and (iii) has all requisite corporate power and authority to
enter into this Agreement and to perform its obligations hereunder.

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     5.2  Authorization and Validity of Agreement.

          (a) The execution, delivery and performance by the Purchaser of this
     Agreement and the consummation by it of the transactions contemplated
     hereby have been duly authorized and approved by all necessary corporate
     action on its part. This Agreement has been duly and validly executed and
     delivered by the Purchaser and is its legal, valid and binding obligation,
     enforceable against it in accordance with its terms, except as the same may
     be limited by applicable bankruptcy, insolvency, reorganization, moratorium
     or other laws related to or affecting creditors' rights generally and by
     general equity principles.

          (b) The execution, delivery and performance by the Purchaser of the
     Related Purchase Agreements to which it will be a party and the
     consummation by the Purchaser of the transactions contemplated thereby will
     be, as of the Closing, duly authorized and approved by all necessary
     corporate action on its part. At the Closing, each of the Related Purchase
     Agreements to which the Purchaser will be a party will be duly and validly
     executed and delivered by it and will be upon execution and delivery its
     legal, valid and binding obligation, enforceable against it in accordance
     with its terms, except as the same may be limited by applicable bankruptcy,
     insolvency, reorganization, moratorium or other laws related to or
     affecting creditors' rights generally and by general equity principles.

     5.3  Lack of Conflicts. The execution, delivery and, assuming receipt of
the Consents contemplated by Schedule 8.3(e), performance by the Purchaser of
this Agreement and the Related Purchase Agreements to which it is or will be a
party and the consummation by it of the transactions contemplated hereby and
thereby does not and, as of the Closing, will not (i) violate (with or without
the giving of notice or the lapse of time or both) any Legal Requirement
applicable to it or any of its Subsidiaries, other than those that would not be
reasonably likely to have a Purchaser Material Adverse Effect, (ii) conflict
with, or result in the breach of, any provision of the charter or by-laws or
similar governing or organizational documents of it or any of its Subsidiaries,
(iii) result in the creation of any Encumbrance upon any of its assets, other
than those arising under this Agreement or those that would not be reasonably
likely to have a Purchaser Material Adverse Effect or (iv) violate, conflict
with or result in the breach or termination of or otherwise give any other
Person the right to terminate, or constitute a default, event of default or an
event that with notice, lapse of time or both, would constitute a default or
event of default under the terms of, any contract, indenture, lease, mortgage,
Government License or other agreement or instrument to which it or any of its
Subsidiaries is a party or by which the properties or businesses of it or any of
its Subsidiaries are bound, except for violations, conflicts, breaches,
terminations and defaults that would not be reasonably likely to have a
Purchaser Material Adverse Effect.

     5.4  Certain Fees. Neither the Purchaser nor any of its Affiliates nor any
of their officers, directors or employees, on behalf of the Purchaser or such
Affiliates, has employed any broker or finder or incurred any other liability
for any financial advisory fees, brokerage fees, commissions or finders' fees in
connection with the transactions contemplated hereby.

                                        9

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     5.5  Financing. The Purchaser either (i) has sufficient cash resources to
pay the purchase price set forth in Section 2.2 and to pay all of its associated
fees and expenses or (ii) has entered into definitive agreements as described in
Schedule 5.5 providing for sufficient funds to pay the purchase price set forth
in Section 2.2 and to pay all of its associated fees and expenses.

     5.6  Investment. The Purchaser is acquiring the Partner Sub Stock for
investment for its own account, not as a nominee or agent, and not with a view
to, or for resale in connection with, any distribution thereof in violation of
applicable law and has not offered or sold any portion of the Partner Sub Stock
to be acquired by it. The Purchaser acknowledges that any certificate
representing Partner Sub Stock will bear the legend set forth in Section 2.1(b)
of the Parent Agreement.

     5.7  Investigation; No General Solicitation. The Purchaser has had a
reasonable opportunity to ask questions relating to and otherwise discuss the
Partnership's business, management and financial affairs with the Occidental
Parties' management and other Persons, and the Purchaser has received
satisfactory responses to its inquiries. To the extent necessary, the Purchaser
has retained, at the expense of the Purchaser, and relied upon appropriate
professional advice regarding the investment, tax and legal merits and
consequences of this Agreement and its purchase of the Partner Sub Stock
hereunder. The Purchaser has relied only on its own independent investigation
and on the Occidental Parties' representations and warranties in this Agreement
before deciding to acquire the Partner Sub Stock.

     5.8  Sophistication and Financial Condition of Purchaser. The Purchaser is
an experienced and sophisticated investor and has such knowledge and experience
in financial and business matters or its professional advisors have such
knowledge and experience in financial and business matters as are necessary to
evaluate the merits and risks of an investment in the Partner Sub Stock and to
protect its own interest in connection with its acquisition of the Partner Sub
Stock. The Purchaser is able to bear the economic risk of this investment, is
able to hold the Partner Sub Stock indefinitely and has a sufficient net worth
to sustain a loss of its entire investment in the Partner Sub Stock in the event
such loss should occur.

                                   SECTION 6
                              ADDITIONAL AGREEMENTS

     6.1  Conduct of Occidental Business Pending the Closing Date. Each
Occidental Party agrees that, except as required or specifically contemplated by
this Agreement or otherwise consented to or approved in writing by the
Purchaser, during the period commencing on the date hereof and ending on the
Closing Date, it shall and shall cause its Affiliates to:

          (a) not amend the organizational documents of any of the Occidental
     Partner Subs or permit the merger or consolidation of any of the Occidental
     Partner Subs;

          (b) not cause or permit any of the Occidental Partner Subs to (i)
     enter into any agreement of any nature, (ii) lease, assign or dispose of
     any assets, (iii) purchase or otherwise acquire any assets, (iv) incur or
     assume any liabilities, (v) except as set forth in the OCC Indemnity and as
     contemplated by Section 6.8, assume, guarantee, endorse or

                                       10

<PAGE>

     otherwise become liable with respect to any indebtedness or (vi) waive any
     material claims or rights;

          (c) not cause or permit any of the Occidental Partner Subs to (i)
     issue any shares of capital stock or limited liability interests or other
     equity or debt securities or options, warrants, conversion rights or other
     rights to acquire equity or debt securities or (ii) split, combine or
     reclassify any of their capital stock or limited liability interests or
     issue or authorize or propose the issuance of any other securities in
     respect of, in lieu or in substitution for, shares of their capital stock
     or limited liability interests;

          (d) not purchase or otherwise acquire any shares of capital stock of
     the Purchaser;

          (e) maintain its or their books, accounts and records of and relating
     to the Occidental Partner Subs in the usual, regular and ordinary manner,
     on a basis consistent with past practice and in accordance with GAAP,
     comply in all material respects with all Legal Requirements and contractual
     obligations applicable to the Occidental Partner Subs and perform all of
     its or their material obligations relating to the Occidental Partner Subs;

          (f) after obtaining Knowledge thereof, give notice to the Purchaser of
     any claim or litigation (threatened or instituted) or any other event or
     occurrence that could reasonably be expected to have an Occidental Material
     Adverse Effect;

          (g) not take any action that is reasonably likely to result in its
     representations and warranties in Section 4 not being true in all material
     respects as of the Closing Date;

          (h) not make or change any election, change an annual accounting
     period, adopt or change any accounting method, file any amended Tax Return,
     or take any other similar action relating to the filing of any Tax Return
     or the payment of any Tax, if such election, adoption, change, or amendment
     would have the effect of increasing the Tax liability of Oxy LP2 or Oxy GP
     for any period ending after the Closing Date;

          (i) not create or suffer to exist any Encumbrance (i) on the Oxy LP1
     Shares, Oxy LP2 Shares and Oxy GP Shares or (ii) following the conversion
     of Oxy LP1 into a limited liability company as contemplated by Section 1.1,
     on the Oxy LP1 Interests; and

          (j) not agree, whether in writing or otherwise, to take any action it
     has agreed pursuant to this Section 6.1 not to take.

     6.2  Further Actions.

          (a) Each Party shall use its commercially reasonable efforts to take,
     or cause to be taken, all other action and do, or cause to be done, all
     other things necessary, proper or appropriate to resolve the objections, if
     any, as may be asserted by any Authority with respect to the transactions
     contemplated hereby under any antitrust laws or regulations.

                                       11

<PAGE>

          (b) Each Party shall act in good faith and use its commercially
     reasonable efforts to take, or cause to be taken, all actions and to do, or
     cause to be done, all things necessary, proper or advisable to consummate
     and make effective the transactions contemplated by this Agreement and to
     confirm that such transactions have been accomplished, including using its
     commercially reasonable efforts to obtain and effect prior to the Closing
     Date all Consents and Filings necessary to consummate the transactions
     contemplated hereby. Each Party shall furnish to the other Parties and
     their Affiliates such necessary information and assistance as the other may
     reasonably request in connection with its preparation of any such Filings
     or other materials required in connection with the foregoing.

          (c) Each Party shall keep the other Parties fully informed from time
     to time as any such other Party shall reasonably request as to the status
     of all Consents being sought by such Party pursuant to Section 6.2(b).

          (d) Each Party shall furnish to the other Parties such information,
     cooperation and assistance as reasonably may be requested in connection
     with the foregoing.

          (e) Each Party shall act in good faith to effect the Closing at the
     earliest practicable date.

          (f) None of the provisions of this Section 6.2 shall under any
     circumstances require the Parties or their respective Affiliates to (i) pay
     any consideration other than legal fees and other customary expenses, (ii)
     surrender, modify or amend in any respect any contract, lease, mortgage or
     other agreement or instrument (including this Agreement), (iii) hold
     separately (in trust or otherwise), divest itself of, or otherwise
     rearrange the composition of, any of its assets, (iv) agree to any
     limitations on its freedom of action with respect to future acquisitions of
     assets or securities or with respect to any existing or future business or
     activities or on the enjoyment of the full rights of ownership, possession
     and use of any asset or security it now owns or hereafter acquires or (v)
     agree to any of the foregoing or any other conditions or requirements of
     any Governmental Authority or other Person, in each case to the extent that
     doing so would be adverse or burdensome to such Person in any material
     respect.

     6.3  Notifications. Each Party shall notify the other Parties and keep each
of them advised as to (i) any Proceeding that is either pending or, to its
Knowledge, threatened against such Party that challenges the transactions
contemplated hereby; and (ii) any fact or circumstance of which such Party has
Knowledge that indicates that any condition to Closing is reasonably likely not
to be satisfied in a timely fashion.

     6.4  No Inconsistent Action. No Party shall take any material action
inconsistent with its obligations under this Agreement or that could materially
hinder or delay the consummation of the Closing; provided, however, that any
action that may be taken in accordance with Section 6.1 shall not be deemed to
violate this Section 6.4.

                                       12

<PAGE>

     6.5  Preservation of Corporate Existence of Oxy LP2. After the Closing and
prior to the first anniversary of the Closing Date, the Purchaser shall not, and
shall not cause or permit any of its Affiliates to, (i) cause Oxy LP2 to be
changed from a corporation to another form of entity or (ii) take any action to
effect the merger, consolidation or liquidation or the Transfer of more than 50%
of the assets of Oxy LP2.

     6.6  Release. Except for the agreement regarding the OCC Indemnity set
forth in Section 6.8, effective upon Closing, Occidental, OCHC, OCC and Oxy CH
hereby unconditionally and irrevocably release and forever discharge, to the
full extent permitted by applicable law, on behalf of themselves and each of
their Affiliates, Oxy LP1, Oxy LP2 and Oxy GP and their successors and assigns,
from any and all rights of setoff or contribution for any liability of
Occidental, OCHC, OCC or Oxy CH.

     6.7  [Intentionally Omitted].

     6.8  Agreement Regarding OCC Indemnity. Effective as of the Closing, Oxy
LP2 shall indemnify OCC for any amount OCC is required to pay pursuant to the
OCC Indemnity.

     6.9  Indemnity and Other Agreements Regarding Potential Loss of Units Under
Section 14 of the Partnership Agreement.

          a)   The Parties hereby acknowledge and agree that:

               (i)   OCC owns the Lake Charles Facility subject to the LC Lease,
          a Petrochemical Plant Site Right of First Refusal Agreement dated
          August 31, 1983 ("Plant ROFR") in favor of CITGO Petroleum
          Corporation, a Delaware corporation ("CITGO"), and the Orange-Lake
          Charles Pipeline Right of First Refusal Agreement dated August 23,
          1983 in favor of CITGO (together with the Plant ROFR, the "ROFRs");

               (ii)  This Agreement does not constitute (A) the entering into of
          any contract, agreement, Lease (as defined in each of the ROFRs) or
          other arrangement to make any Disposition (as defined in each of the
          ROFRs) or (B) the granting of an option or other right to acquire or
          Lease (as defined in each of the ROFRs) the Lake Charles Facility or
          any part thereof or any interest therein;

               (iii) This Agreement (A) shall not grant any rights whatsoever to
          Purchaser with respect to the Lake Charles Facility other than
          indirect rights in the LC Lease and (B) is subject to, and not
          superior to, CITGO's rights under the ROFRs; and

               (iv)  An independent third party appraiser has determined that,
          as of the date of the Appraisal, the Lake Charles Facility's fair
          market value is $75 million, and the Parties have reflected this
          valuation in the Plant Put Option Agreement.

                                       13

<PAGE>

          (b)  If at any time prior to a Lease Termination Event the Purchaser
     believes in good faith it would be in the best interests of the
     Partnership, then OCC may make the Plant Transfer to the Partnership if
     OCC's board of directors, in its sole discretion, elects to do so. In such
     event, the Purchaser shall take all actions necessary to cause the
     Partnership to accept the Plant Transfer that are within its control and
     shall use commercially reasonable efforts to obtain from the Partnership
     and any other partners of the Partnership all such actions by them as are
     necessary for the Partnership to accept the Plant Transfer.

          (c)  (i)  If there is a Lease Termination Event and (A) OCC or one of
          its Affiliates owns the Lake Charles Facility and (B) no Person other
          than OCC, its Affiliates, the Partnership or the Purchaser is entitled
          to use and operate the Lake Charles Facility, then the Parties shall
          use their commercially reasonable efforts to agree, and to cause the
          Partnership to consent, to an arrangement that provides for the use
          and operation of the Lake Charles Facility by the Purchaser or its
          designee on terms reasonably acceptable to OCC and the Purchaser or
          its designee (which may include formation of the LC Partnership (as
          defined in the Partnership Agreement)).

               (ii) If the Parties are unable to reach agreement as to the
          arrangement described in Section 6.9(c)(i), then, upon the Purchaser's
          request, OCC or one of its Affiliates shall operate or hold the Lake
          Charles Facility at the Purchaser's direction and for the Purchaser's
          benefit and account. If the Purchaser does not make such request, OCC
          or one of its Affiliates may operate the Lake Charles Facility for its
          own or its Affiliates' benefit and account.

          (d)  At the Closing, the Parties shall execute and deliver the Plant
     Put Option Agreement. The Plant Put Option Agreement shall provide, among
     other things, that: (i) OCC shall have the right in its sole discretion to
     consummate a Plant Transfer to the Purchaser or, at the Purchaser's option,
     its designee (the "Put Right"); (ii) the Put Right shall be exercisable for
     a period commencing on May 16, 2003 and terminating on the earlier of the
     date that is (A) 60 days after the date a Lease Termination Event occurs
     (unless one of the events described in Section 6.9(e)(ii) or (iii) has
     occurred and is continuing, in which case the 60-day time period shall be
     tolled while the events described in Section 6.9(e)(ii) or (iii) are
     continuing), (B) the date of a No Rebuilding Termination or (C) July 1,
     2009; and (iii) the purchase price to be paid by the Purchaser for the
     Plant Transfer shall be $75,000,000. Upon consummation of the Plant
     Transfer as contemplated by this Section 6.9(d), the Parties acknowledge
     and agree that Section 14 of the Partnership Agreement shall not be
     applicable.

          (e)  If there has been a Lease Termination Event and none of the
     following has occurred and, in the case of clauses (ii) or (iii) below, is
     continuing:

               (i)  the Plant Transfer as described under Section 6.9(b);

                                       14

<PAGE>

               (ii)  an arrangement providing for the use and operation of the
          Lake Charles Facility by the Purchaser or its designee as described
          under Section 6.9(c)(i) and such arrangement continues to be in
          effect;

               (iii) OCC or one of its Affiliates is operating or holding the
          Lake Charles Facility at the Purchaser's direction and for the
          Purchaser's benefit and account as described under Section 6.9(c)(ii)
          and continues to do so (the event described in this clause shall be
          deemed to have occurred and be continuing so long as either (A) the
          Purchaser did not request such operation or holding or (B) such
          operation or holding ceases because the Purchaser or its designee so
          requests); or

               (iv)  the Put Right has been exercised and the closing has
          occurred under the Plant Sale Agreement as described under Section
          6.9(d);

     then, on the date that none of Section 6.9(e)(i), (ii), (iii) or (iv) has
     occurred and, in the case of clauses (ii) or (iii) above, is continuing,
     the Occidental Parties shall promptly pay (and shall be jointly and
     severally liable to promptly pay) to the Purchaser or its designee an
     amount (the "Make Whole Amount") equal to the greater of (x) $75 million in
     cash or (y) the Alternate Cash Consideration.

          (f)  The provisions of Sections 6.9(b), 6.9(c), 6.9(d), 6.9(e) and
     6.9(h) shall be the Purchaser's sole and exclusive remedy for any loss of
     Units it or its Affiliates might incur as a result of the operation of
     Section 14 of the Partnership Agreement or as a result of the loss of the
     use and operation of the Lake Charles Facility; provided, however, that the
     exclusivity of these provisions with regard to first party claims of the
     Purchaser shall not in any manner preempt or limit any rights that the
     Purchaser and its Affiliates may have with respect to Third Party Claims
     (as defined in the Parent Agreement) under Section 3.4 of the Parent
     Agreement or Third Party Claims under any analogous provisions contained in
     this Agreement.

          (g)  Each of the Purchaser and the Occidental Parties shall mitigate,
     and shall cause each of its respective Affiliates to mitigate, any damages
     resulting from a loss of Units as a result of the operation of Section 14
     of the Partnership Agreement or from the loss of the use and operation of
     the Lake Charles Facility, by taking all actions which a reasonable person
     would undertake to minimize or alleviate the amount of such losses and the
     consequences thereof, as if such Person would be required to suffer the
     entire amount of such losses and the consequences thereof by itself,
     without recourse or any remedy against another Person, including pursuant
     to the right of the Purchaser to receive the Make Whole Amount hereunder.

          (h)  If there is a No Rebuilding Termination and as a result thereof
     the Purchaser or any of its Affiliates suffers a loss of Units pursuant to
     Section 14.3 of the Partnership Agreement, then, provided that the
     Partnership has complied with its obligation to deliver the related
     Proceeds to OCC under Section 12 or 13 of the LC Lease, as applicable, the
     Occidental Parties shall pay the Purchaser the Make Whole Amount.

                                       15

<PAGE>

          (i) As security for the Occidental Parties' obligations pursuant to
     Sections 6.9(e) and 6.9(h), OCHC shall establish and fund the Section 14
     Escrow.

          (j) The Parties and their respective Affiliates (including, for these
     purposes, the Partnership to the extent any of such Persons have the power
     to control the Partnership's actions) agree that in connection with or
     otherwise in relation to any Lease Termination Event, they shall not
     directly or indirectly take any action that is contrary to or inconsistent
     with the provisions of this Section 6.9.

                                    SECTION 7
               ADDITIONAL AGREEMENTS REGARDING CERTAIN TAX MATTERS

     7.1  Absence of Section 338(h)(10) Election. The Parties and Occidental
agree that, with respect to the purchase of the Oxy LP2 Shares and the Oxy GP
Shares, the Parties and Occidental shall not make an election or cause or permit
any of its Affiliates or its or their successors to make an election with
respect to Section 338(h)(10) of the Code or any comparable provision of
applicable law.

     7.2  Absence of Tax Election As to Oxy LP1. The Occidental Parties shall
not, and shall not cause or permit any of their Affiliates to, make any
affirmative election for Oxy LP1 with respect to the conversion of Oxy LP1 to a
Delaware limited liability company to be treated as an association subject to
taxation as a corporation for purposes of the Code.

     7.3  Tax Indemnification. Each Occidental Party shall jointly and severally
indemnify each Occidental Partner Sub, the Purchaser and the Purchaser's
Affiliates and hold them harmless from and against without duplication, any Loss
attributable to (i) all Taxes (or the non-payment thereof) of any Occidental
Partner Sub for all taxable periods ending on or before the Closing Date and the
portion through the end of the Closing Date for any taxable period that includes
(but does not end on) the Closing Date ("Pre-Closing Tax Period"), (ii) all
Taxes of any member (other than on Occidental Partner Sub) of an affiliated,
consolidated, combined or unitary group of which any Occidental Partner Sub (or
any predecessor of any of the foregoing) is or was a member on or prior to the
Closing Date, including pursuant to Treasury Regulation Section 1.1502-6 or any
analogous or similar state, local or foreign law or regulation, (iii) any and
all Taxes of any Person (other than an Occidental Partner Sub) imposed on any
Occidental Partner Sub as a transferee or successor, by contract or pursuant to
any law, rule or regulation, which Taxes relate to an event or transaction
occurring before the Closing and (iv) arising by reason of any breach by an
Occidental Party of the representations contained in Section 4.7.

     7.4  Tax Indemnification Duration. The obligations of the Occidental
Parties pursuant to Section 7.3 are unconditional and absolute and shall remain
in effect until audit, assessment and collection of any such Taxes are barred by
the applicable statute of limitations plus sixty days.

     7.5  Straddle Periods. Occidental shall include the taxable income or loss
of Oxy LP1, Oxy LP2 and Oxy GP (including any deferred income triggered into
income under Treasury Regulation Sections 1.1502-13 and 1.1502-14 and any excess
loss accounts taken into income under Treasury Regulation Section 1.1502-1) on
Occidental's consolidated federal income Tax

                                       16

<PAGE>

Returns for all periods through the Closing Date and pay any federal income
taxes attributable to such income. The income of Oxy LP1, Oxy LP2 and Oxy GP
will be apportioned through the period up to and including the Closing Date and
the period after the Closing Date by closing the books of Oxy LP1, Oxy LP2 and
Oxy GP as of the Closing Date. Notwithstanding the foregoing, however,
Occidental and the Purchaser agree that all transactions not in the ordinary
course of business occurring on the Closing Date after the Purchaser's purchase
of the Occidental Partner Subs shall be reported on the Purchaser's consolidated
federal income tax return to the extent permitted by Treasury Regulation Section
1.1502-76(b)(1)(ii)(B).

     7.6  Responsibility for Filing Tax Returns for Periods through Closing
Date. For all taxable periods ending on or before the Closing Date, Occidental
shall cause the Occidental Partner Subs to join in Occidental's consolidated
federal income tax return, to join in any applicable combined or unitary state
Tax Return filed by Occidental (or an Affiliate) and, in jurisdictions requiring
separate reporting from Occidental, to file separate company state and local Tax
Returns. All such Tax Returns shall be prepared and filed in a manner consistent
with prior practice of the Partnership, except as required by a change in
applicable law or except as required for closing the books of Oxy LP1, Oxy LP2
and Oxy GP as of the Closing Date. The Purchaser shall cause the Partnership and
the Occidental Partner Subs to furnish information to Occidental as reasonably
requested by Occidental to allow Occidental to satisfy its obligations under
this Section 7.6 in accordance with past custom and practice, except that in no
event shall such requested information be furnished to Occidental any later than
the later of, (i) six months following the Closing Date or (ii) one month
following the date such information was requested. Except for items reported by
the Partnership, the Occidental Parties and their Affiliates shall not file any
Tax Return that departs from past practice that would have a material adverse
impact on the Tax attributes or liabilities of Oxy LP2 after the Closing Date.
The Purchaser shall include the Occidental Partner Subs in its combined or
consolidated income tax returns, for all periods other than periods ending on or
before the Closing Date. The Purchaser shall not cause any Occidental Partner
Sub to file any Tax Return for a Pre-Closing Tax Period.

     7.7  Cooperation on Tax Matters.

          (a) The Purchaser, Occidental Partner Subs and the Occidental Parties
     shall cooperate fully, as and to the extent reasonably requested by any
     other Party, in connection with the filing of Tax Returns pursuant to this
     Section 7.7 and any audit, litigation or other proceeding with respect to
     Taxes. Such cooperation shall include the retention and (upon any other
     Party's request) the provision of records and information which are
     reasonably relevant to any such audit, litigation or other proceeding and
     making employees available on a mutually convenient basis to provide
     additional information and explanation of any material provided pursuant to
     this Section 7.7. The Occidental Parties agree, and shall cause their
     Affiliates (including the Occidental Partner Subs), to retain all books and
     records with respect to Tax matters pertinent to the Occidental Partner
     Subs relating to any taxable period beginning before the Closing Date until
     the expiration of the statute of limitations (and, to the extent notified
     by the Purchaser any extensions thereof) of the respective taxable periods,
     and to abide by all record retention agreements entered into with any
     taxing Authority.

                                       17

<PAGE>

          (b) The Purchaser and the Occidental Parties further agree, upon
     request, to use their best efforts to obtain any certificate or other
     document from any governmental Authority or any other Person as may be
     necessary to mitigate, reduce or eliminate any Taxes that could be imposed
     (including with respect to the transactions contemplated hereby).

          (c) The Purchaser and the Occidental Parties further agree, upon
     request, to provide the other with all information that such Party may be
     required to report pursuant to Section 6043 of the Code and all Treasury
     Regulations promulgated thereunder.

     7.8  Tax Sharing Agreements. All Tax sharing agreements or similar
agreements with respect to or involving the Occidental Partner Subs shall be
terminated as of the Closing Date and, after the Closing Date, the Occidental
Partner Subs shall not be bound thereby or have any liability thereunder.

     7.9  Certain Taxes and Fees. All transfer, documentary, sales, use, stamp,
registration and other such Taxes, and all conveyance fees, recording charges
and other fees and charges (including any penalties and interest) incurred in
connection with consummation of the transactions contemplated by this Agreement
shall be paid 50% by the Occidental Parties or their Affiliate and 50% by the
Purchaser when due, and the Occidental Parties will, and will cause their
Affiliates to, at their own expense, file all necessary Tax Returns and other
documentation with respect to all such Taxes, fees and charges, and, if required
by applicable law, the Purchaser will, and will cause its Affiliates to, join in
the execution of any such Tax Returns and other documentation.

     7.10 Audits. Occidental shall fully inform Oxy LP2 regarding issues raised
during any audit of Occidental's consolidated federal income Tax Returns to the
extent that such returns and such issues relate to the Occidental Partner Subs.
Occidental shall not settle any such audit in a manner which would cause Oxy LP2
to include a material item of income in its taxable income in a taxable year
ending after the Closing Date without: (i) paying to the Company an amount equal
to the present value (calculated using a discount rate equal to LIBOR plus 150
basis points) of the Tax attributable to such increase in taxable income; or
(ii) obtaining the prior written consent of the Company, which consent shall not
unreasonably be withheld.

     7.11 Carrybacks. The Purchaser and its Affiliates agree to make a proper
and binding irrevocable election under Treasury Regulation Section
1.1502-21(b)(3)(ii)(B) on the Purchaser's consolidated federal income tax return
to waive the carryback of net operating losses of Oxy LP2 and Oxy GP to taxable
years in which Oxy LP2 and Oxy GP were members of Occidental's consolidated
federal income tax return.

     7.12 Post Closing Elections. At the request of Occidental, the Purchaser
shall cause Oxy LP2 and Oxy GP to make or join with Occidental in making any
election if the making of such election does not have an adverse impact on the
Purchaser or any Occidental Partner Sub for any post-acquisition Tax period.

                                       18

<PAGE>

     7.13 Consistent Tax Treatment. For all federal and state tax reporting
purposes, the Occidental Parties and the Purchaser shall maintain the following
positions (except to the extent that such Party receives an opinion from
nationally recognized tax counsel that, as a result of a change in applicable
law after the date hereof, there is no reasonable basis for maintaining such
position):

          (a) The purchase and sale of the Oxy LP1 Interests, the Oxy LP2 Shares
     and the Oxy GP Shares are all taxable sales and none of such transactions
     qualify for treatment as a "reorganization" within the meaning of Section
     368(a) of the Code; and

          (b) For all purposes of Subchapter K of the Code, the past practices
     used to allocate the recourse and nonrecourse liabilities of the
     Partnership among its partners are proper.

     7.14 Refunds. If the Purchaser or its Affiliate receives a Tax refund with
respect to Tax of an Occidental Partner Sub arising in a Pre-Closing Tax Period,
the Purchaser shall pay (or cause its Affiliate to pay), within the 30 calendar
days following the receipt of such Tax refund, the amount of such Tax refund to
OCHC. If Occidental or its Affiliate receives a Tax refund with respect to Tax
of an Occidental Partner Sub arising in any Tax period other than a Pre-Closing
Tax Period, within 30 days following the receipt of such Tax refund, Occidental
or its Affiliate shall pay the amount of such Tax refund to the Purchaser.

                                    SECTION 8
                              CONDITIONS TO CLOSING

     8.1  Conditions Precedent to Obligations of Both Parties. The respective
obligations of the Parties to consummate the transactions contemplated by this
Agreement shall be subject to the satisfaction on or prior to the Closing Date
of each of the following conditions:

          (a) No Injunction, etc. No Legal Requirement of any Authority shall be
     in effect that materially restrains, enjoins or otherwise prohibits: (i)
     the transactions contemplated hereby; or (ii) the ownership by the
     Purchaser (including enjoyment of any rights relating thereto) of the
     Partner Sub Stock; and no Proceeding seeking any such Legal Requirement
     shall be pending; provided that before any determination is made to the
     effect that this condition has not been satisfied, each Party shall each
     use commercially reasonable efforts to have such Legal Requirement lifted,
     vacated or dismissed.

          (b) HSR Act. The waiting period applicable to the Closing under the
     HSR Act shall have expired or been terminated without the imposition of any
     condition or restriction on such expiration or termination.

     8.2  Conditions Precedent to Obligations of Occidental Parties. The
obligations of the Occidental Parties under this Agreement are subject to the
satisfaction (or written waiver by the Occidental Parties) on or prior to the
Closing Date of each of the following conditions:

                                       19

<PAGE>

          (a) Accuracy of Representations and Warranties. Notwithstanding any
     investigation, inspection or evaluation conducted or notice or Knowledge
     obtained by any Occidental Party, all representations and warranties of the
     Purchaser contained in this Agreement that contain qualifications and
     exceptions relating to materiality or a Purchaser Material Adverse Effect
     shall be true and correct on and as of the Closing Date, and all other
     representations and warranties of the Purchaser contained in this Agreement
     shall be true and correct in all material respects as of the Closing Date,
     in each case with the same force and effect as though such representations
     and warranties had been made on and as of the Closing Date.

          (b) Performance of Agreements. The Purchaser shall in all material
     respects have performed and complied with all obligations and agreements
     contained in this Agreement, and executed all agreements and documents
     (including the Related Purchase Agreements) to be performed, complied with
     or executed by it on or prior to the Closing Date.

          (c) No Material Adverse Change. After the date of this Agreement, no
     event, occurrence or other matter shall have occurred that is reasonably
     likely to have a Purchaser Material Adverse Change.

          (d) Third Party Consents. All Consents of any third party listed on
     Schedule 8.2(d) shall have been obtained.

          (e) Officer's Certificate. Occidental shall have received a
     certificate, dated the Closing Date, signed by the President or a Vice
     President of the Purchaser, to the effect that, to the knowledge of such
     officer, the conditions specified in the above paragraphs have been
     fulfilled.

          (f) Execution of Parent Agreement. The Purchaser shall have executed a
     copy of the Parent Agreement pursuant to Section 2.2(e) of the Parent
     Agreement and shall have complied with all other applicable requirements of
     Section 2.2(e) of the Parent Agreement.

     8.3  Conditions Precedent to Obligations of the Purchaser. The obligations
of the Purchaser under this Agreement are subject to the satisfaction (or
written waiver by the Purchaser) on or prior to the Closing Date of each of the
following conditions:

          (a) Accuracy of Representations and Warranties. Notwithstanding any
     investigation, inspection or evaluation conducted or notice or Knowledge
     obtained by the Purchaser, all representations and warranties of the
     Occidental Parties contained in this Agreement that contain qualifications
     and exceptions relating to materiality or to an Occidental Material Adverse
     Effect shall be true and correct on and as of the Closing Date, and all
     other representations and warranties of the Occidental Parties contained in
     this Agreement shall be true and correct in all material respects as of the
     Closing Date, in each case with the same force and effect as though such
     representations and warranties had been made on and as of the Closing Date;
     except that the representations in Sections

                                       20

<PAGE>

     4.5(a) through (e) as they relate to Oxy LP1 need not be true and correct
     as of the Closing Date.

          (b) Performance of Agreements. Each Occidental Party, Oxy LP2 and
     Occidental shall in all material respects have performed and complied with
     all obligations and agreements contained in this Agreement and executed all
     agreements and documents (including the Related Purchase Agreements) to be
     performed, complied with or executed by it or them on or prior to the
     Closing Date, including the covenants set forth in Section 1.2.

          (c) No Material Adverse Change. After the date of this Agreement, no
     event, occurrence or other matter shall have occurred that is reasonably
     likely to have an Occidental Material Adverse Change.

          (d) FIRPTA Affidavit. Each Occidental Party shall have delivered to
     the Purchaser a non-foreign affidavit dated as of the Closing Date, sworn
     under penalty of perjury and in form and substance required under the
     Treasury Regulations issued pursuant to (S).1445 of the Code stating that
     such seller is not a "foreign person" as defined in (S).1445 of the Code.

          (e) Third Party Consents. All Consents of any third party listed on
     Schedule 8.3(e) shall have been obtained.

          (f) Officer's Certificate. The Purchaser shall have received a
     certificate, dated the Closing Date from each Occidental Party, signed by
     the President or a Vice President of the applicable Occidental Party, to
     the effect that, to the knowledge of such officer, the conditions specified
     in the above paragraphs have been fulfilled.

          (g) Financing. The Purchaser shall have consummated the transactions
     described in any definitive agreement referred to in Section 5.5 and the
     Purchaser shall have received the funds as provided therein.

                                    SECTION 9
                                   TERMINATION

     9.1  General. This Agreement may be terminated and the transactions
contemplated herein may be abandoned at any time prior to the Closing:

          (a) by the written consent of the Parties;

          (b) by the Purchaser if there has been a material misrepresentation or
     a breach of an agreement by any Occidental Party in this Agreement that (i)
     if such misrepresentation or breach existed on the Closing Date, would
     constitute a failure to satisfy any condition to Closing set forth in
     Section 8.3(a) or (b) and (ii) has not been cured and cannot reasonably be
     cured by the earlier of (x) 30 days after all other conditions to Closing
     have been satisfied and (y) the Termination Date;

                                       21

<PAGE>

          (c) by any Occidental Party if there has been a material
     misrepresentation or a breach of an agreement by the Purchaser in this
     Agreement that (i) if such misrepresentation or breach existed on the
     Closing Date, would constitute a failure to satisfy any condition to
     Closing set forth in Section 8.2(a) or (b) and (ii) has not been cured and
     cannot reasonably be cured by the earlier of (x) 30 days after all other
     conditions to Closing have been satisfied and (y) the Termination Date;

          (d) by the Purchaser or any Occidental Party in the event that the
     Closing does not occur for any reason on or before 90 days after the date
     hereof, as such 90-day period may be extended for up to an additional 120
     days upon request of any Party (the "Termination Date"). The right to
     terminate this Agreement pursuant to this Section 9.1(d) shall not be
     available to any Party whose breach of this Agreement has been the cause
     of, or resulted in, the failure of the Closing to occur by the Termination
     Date unless the failure to Close by such date is due to a breach by both of
     the Parties (in which case the Purchaser or any Occidental Party may
     terminate this Agreement as provided by Sections 9.1(b) or 9.1(c),
     respectively); or

          (e) by any Party if it becomes impossible to satisfy any condition to
     that party's performance set forth in Sections 8.2 or 8.3.

Any right of termination set forth above shall be exercised by written notice
from the terminating Party to each other Party.

     9.2  Effect of Termination. In the event of any termination of this
Agreement as provided above, this Agreement shall forthwith become wholly void
and of no further force and effect and there shall be no liability on the part
of any Party, its Affiliates or their respective officers or directors;
provided, however, that upon any such termination, the obligations of the
Parties with respect to this Section 9.2 and Sections 11.6, 11.11, 11,13 and
11.14 shall remain in full force and effect; and provided, further, that nothing
herein will relieve any Party from liability for damages for any breach of this
Agreement.

                                   SECTION 10
                          SURVIVAL AND INDEMNIFICATION

     10.1 Survival.

          (a) The representations and warranties of the Parties contained in
     this Agreement or in any Related Purchase Agreement shall not survive the
     Closing, except that (i) the representations and warranties contained in
     Sections 4.5 and 4.6 shall survive indefinitely, together with any
     associated right of indemnification pursuant to Section 10.3, (ii) the
     representations and warranties contained in Sections 4.1, 4.2, 4.3, 4.4,
     5.1, 5.2, 5.3, 5.4, 5.6, 5.7 and 5.8 shall survive two years after the
     Closing, and shall thereafter terminate, together with any associated right
     of indemnification pursuant to Sections 10.2 or 10.3 and (iii) the
     representations and warranties relating to Taxes or contained in Section
     4.7 shall survive until expiration of the applicable statutory period of
     limitations (giving effect to any waiver, mitigation or extension thereof),
     and shall thereafter

                                       22

<PAGE>

     terminate, and the associated right of indemnification pursuant to Section
     10.3 shall terminate at the end of the period set forth in Section 7.4.

          (b)  Except as expressly provided in this Agreement, the covenants and
     agreements of the Parties contained in this Agreement or in any Related
     Purchase Agreement shall not be limited or affected by any investigation
     undertaken by a Party, and shall survive indefinitely, together with any
     associated right of indemnification.

     10.2 Indemnification by the Purchaser.

          (a)  From and after the Closing, the Purchaser shall indemnify, defend
     and hold harmless the Occidental Indemnified Parties from, against and in
     respect of any losses, claims, damages, fines, penalties, assessments by
     public agencies, settlement, cost or expenses (including reasonable
     attorneys' fees) and other liabilities (any of the foregoing being a
     "Loss"), as incurred (payable promptly upon written request), arising from,
     in connection with or otherwise with respect to:

               (i)  any breach of any representation or warranty of the
          Purchaser in this Agreement that survives the Closing; and

               (ii) any breach of any covenant or agreement of the Purchaser in
          this Agreement.

          (b)  Notwithstanding the foregoing, the Purchaser shall not have any
     liability with respect to breaches of representations and warranties in
     this Agreement (i) of which the Occidental Parties have Knowledge as of the
     Closing Date or (ii) under Section 10.2(a)(i) unless the aggregate of all
     Losses for which the Purchaser would, but for this Section 10.2(b)(i), be
     liable exceeds on a cumulative basis an amount equal to 1% of the purchase
     price paid pursuant to Section 2.2; provided, however, that after such
     amount is reached the Purchaser shall be responsible for the full amount of
     such Loss.

     10.3 Indemnification by the Occidental Parties.

          (a)  From and after the Closing, the Occidental Parties shall
     indemnify, defend and hold harmless the Purchaser Indemnified Parties from,
     against and in respect of any Loss, as incurred (payable promptly upon
     written request), arising from, in connection with or otherwise with
     respect to:

               (i)  any breach of any representation or warranty of the
          Occidental Parties in this Agreement that survives the Closing; and

               (ii) any breach of any covenant or agreement of the Occidental
          Parties in this Agreement.

          (b)  Notwithstanding the foregoing, the Occidental Parties shall not
     have any liability with respect to breaches of representations and
     warranties in this Agreement (i) of which the Purchaser has Knowledge as of
     the Closing Date or (ii) under Section 10.3(a)(i) unless the aggregate of
     all Losses for which the Occidental Parties

                                       23

<PAGE>

     would, but for this Section 10.3(b)(i), be liable exceeds on a cumulative
     basis an amount equal to 1% of the purchase price paid pursuant to Section
     2.2; provided, however, that after such amount is reached the Occidental
     Parties shall be responsible for the full amount of such Loss.

     10.4 Mutual Indemnity. From the date hereof through the twenty-first
anniversary hereof:

          (a) The Purchaser hereby agrees to the fullest extent permitted by
     applicable law, to indemnify, defend and hold harmless the Occidental
     Indemnified Parties from, against and in respect of any Loss incurred by
     any of the Occidental Indemnified Parties arising out of, in connection
     with, or relating to, any Third Party Claim (whether in contract, tort,
     statute or otherwise) arising out of, in connection with, or relating to
     the failure of the Purchaser or any of its Affiliates to give notice to,
     obtain any consent of, or obtain any waiver by, or any breach by the
     Purchaser or any of its Affiliates of any obligation owing to, any Person,
     in each case with respect to the Purchaser or its Affiliates' entering into
     this Agreement or performing their respective obligations hereunder.

          (b) Each of the Occidental Parties agrees, and Occidental agrees, to
     the fullest extent permitted by applicable law, to indemnify, defend and
     hold harmless the Purchaser Indemnified Parties from, against and in
     respect of any Loss incurred by any of the Purchaser Indemnified Parties
     arising out of, in connection with, or relating to, any Third Party Claim
     (whether in contract, tort, statute or otherwise) arising out of, in
     connection with, or relating to the failure of an Occidental Party or any
     of its Affiliates to give notice to, obtain any consent of, or obtain any
     waiver by, or any breach by an Occidental Party or any of its Affiliates of
     any obligation owing to, any Person, in each case with respect to such
     Occidental Party's or its Affiliates' entering into this Agreement or
     performing their respective obligations hereunder.

     10.5 Mitigation; Limitation on Consequential, Punitive and Exemplary
Damages; Exclusive Remedy.

          (a) Each of the Parties shall mitigate, and shall cause each of its
     Affiliates to mitigate, any Loss that such Party or its Affiliates may
     suffer as a consequence of any matter giving rise to a right to
     indemnification against any other Party or its Affiliates under Section 10
     by taking all actions which a reasonable person would undertake to minimize
     or alleviate the amount of such Loss and the consequences thereof, as if
     such Person would be required to suffer the entire amount of such Loss and
     the consequences thereof by itself, without recourse to any remedy against
     another Person, including pursuant to any right of indemnification
     hereunder.

          (b) Notwithstanding any other provision of this Agreement, no
     Indemnifying Party nor its Affiliates nor their respective agents,
     employees or representatives shall be liable under Section 10 for
     consequential, incidental, indirect or punitive damages or lost profits in
     connection with direct claims by an Indemnified Party (i.e., a claim by an
     Indemnified Party that does not seek reimbursement for a Third Party Claim
     paid or

                                       24

<PAGE>

     payable by the Indemnified Party) with respect to the indemnification
     obligations under this Agreement unless any such claim arises out of the
     fraudulent actions of an Indemnifying Party or its Affiliates.

          (c) The rights provided to each Indemnified Party pursuant to this
     Section 10, as limited by and subject to the provisions of this Section 10,
     shall be such Indemnified Party's sole remedy for breach of any
     representation or warranty by or covenant or obligation of any Indemnifying
     Party under this Agreement or any Related Purchase Agreement.

     10.6 EXTENT OF INDEMNIFICATION. WITHOUT LIMITING OR ENLARGING THE SCOPE OF
THE INDEMNIFICATION OBLIGATIONS SET FORTH HEREIN, TO THE FULLEST EXTENT
PERMITTED BY LAW, AN INDEMNIFIED PARTY SHALL BE ENTITLED TO INDEMNIFICATION
UNDER SECTION 10.4 IN ACCORDANCE WITH THE TERMS HEREOF, REGARDLESS OF WHETHER
THE INDEMNIFIABLE LOSS GIVING RISE TO ANY SUCH INDEMNIFICATION OBLIGATION IS THE
RESULT OF THE SOLE, GROSS, ACTIVE, PASSIVE, CONCURRENT OR COMPARATIVE
NEGLIGENCE, STRICT LIABILITY OR OTHER FAULT OR VIOLATION OF ANY LAW OF OR BY ANY
SUCH INDEMNIFIED PARTY. THE PARTIES AGREE THAT THIS STATEMENT CONSTITUTES A
CONSPICUOUS LEGEND.

     10.7 Procedures.

          (a) In order for an Indemnified Party to be entitled to any
     indemnification provided for under Sections 7.3, 10.2 and 10.3, such
     Indemnified Party shall deliver written notice of a claim for
     indemnification with reasonable promptness to the Indemnifying Party, which
     notice shall describe in reasonable detail the nature of the claim, an
     estimate of the amount of damages attributable to such claim to the extent
     feasible and the basis of the Indemnified Party's request for
     indemnification hereunder; provided that any failure to timely give such
     notice shall not relieve the Indemnifying Party of any of its obligations
     under this Section 10.7(a) except to the extent that such failure
     prejudices or impairs, in any material respect, any of the rights or
     obligations of the Indemnifying Party. If the Indemnifying Party disputes
     its liability with respect to such claim, the Indemnifying Party and the
     Indemnified Party shall proceed in good faith to negotiate a resolution of
     such dispute and, if not resolved through negotiations, the Indemnified
     Party may initiate a judicial proceeding in accordance with the conditions
     set forth in Sections 11.10, 11.13 and 11.14.

          (b) If an Indemnified Party is notified of a Third Party Claim which
     may give rise to a claim for indemnification against any Indemnifying Party
     under Section 10.4, then the Indemnified Party shall promptly notify each
     Indemnifying Party thereof in writing (including copies of all papers
     served with respect to such Third Party Claim), which notice shall describe
     in reasonable detail the nature of the Third Party Claim, an estimate of
     the amount of damages attributable to such Third Party Claim to the extent
     feasible and the basis of the Indemnified Party's request for
     indemnification hereunder; provided that any failure to timely give such
     notice shall not relieve the Indemnifying Party of any of its obligations
     under this Section 10.6(b) except to the extent that such

                                       25

<PAGE>

     failure prejudices or impairs, in any material respect, any of the rights
     or obligations of the Indemnifying Party.

          (c) Any Indemnifying Party may, and at the request of the Indemnified
     Party shall, participate in and control the defense of the Third Party
     Claim with counsel of its choice reasonably satisfactory to the Indemnified
     Party. The Indemnified Party shall have the right to employ separate
     counsel in any such action and to participate in the defense thereof, but
     the fees and expenses of such counsel shall be at the expense of the
     Indemnified Party unless (i) the employment thereof has been specifically
     authorized in writing by the Indemnifying Party, (ii) the Indemnifying
     Party failed to assume the defense and employ counsel or failed to
     diligently prosecute or settle the Third Party Claim or (iii) there shall
     exist or develop a conflict that would ethically prohibit counsel to the
     Indemnifying Party from representing the Indemnified Party. If requested by
     the Indemnifying Party, the Indemnified Party agrees to cooperate with the
     Indemnifying Party and its counsel in contesting any Third Party Claim that
     the Indemnifying Party elects to contest, including, without limitation, by
     making any counterclaim against the person or entity asserting the Third
     Party Claim or any cross-complaint against any person or entity, in each
     case only if and to the extent that any such counterclaim or
     cross-complaint arises from the same actions or facts giving rise to the
     Third Party Claim. The Indemnifying Party shall be the sole judge of the
     acceptability of any compromise or settlement of any claim, litigation or
     proceeding in respect of which indemnity may be sought hereunder, provided
     that the Indemnifying Party shall give the Indemnified Party reasonable
     prior written notice of any such proposed settlement or compromise and will
     not consent to the entry of any judgment or enter into any settlement with
     respect to any Third Party Claim without the prior written consent of the
     Indemnified Party, which shall not be unreasonably withheld. The
     Indemnifying Party (if the Indemnified Party is entitled to indemnification
     hereunder) shall reimburse the Indemnified Party for its reasonable out of
     pocket costs incurred with respect to such cooperation.

          (d) If the Indemnifying Party fails to assume the defense of a Third
     Party Claim within a reasonable period after receipt of written notice
     pursuant to the first sentence of subparagraph (c), or if the Indemnifying
     Party assumes the defense of the Indemnified Party pursuant to subparagraph
     (c) but fails to diligently prosecute or settle the Third Party Claim, then
     the Indemnified Party shall have the right to defend, at the sole cost and
     expense of the Indemnifying Party (if the Indemnified Party is entitled to
     indemnification hereunder), the Third Party Claim by all appropriate
     proceedings, which proceedings shall be promptly and vigorously prosecuted
     by the Indemnified Party to a final conclusion or settled. The Indemnified
     Party shall have full control of such defense and proceedings; provided
     that the Indemnified Party shall not settle such Third Party Claim without
     the written consent of the Indemnifying Party, which consent shall not be
     unreasonably withheld. The Indemnifying Party may participate in, but not
     control, any defense or settlement controlled by the Indemnified Party
     pursuant to this Section, and the Indemnifying Party shall bear its own
     costs and expenses with respect to such participation.

                                       26

<PAGE>

          (e) Notwithstanding the other provisions of this Section 10.7, if the
     Indemnifying Party disputes its potential liability to the Indemnified
     Party under this Section 10.7 and if such dispute is resolved in favor of
     the Indemnifying Party, the Indemnifying Party shall not be required to
     bear the costs and expenses of the Indemnified Party's defense pursuant to
     this Section 10.7 or of the Indemnifying Party's participation therein at
     the Indemnified Party's request, and the Indemnified Party shall reimburse
     the Indemnifying Party in full for all costs and expenses of the litigation
     concerning such dispute. If a dispute over potential liability is resolved
     in favor of the Indemnified Party, the Indemnifying Party shall reimburse
     the Indemnified Party in full for all costs of the litigation concerning
     such dispute.

          (f) After it has been determined, by acknowledgment, agreement, or
     ruling of court of law, that an Indemnifying Party is liable to the
     Indemnified Party under this Section 10, the Indemnifying Party shall pay
     or cause to be paid to the Indemnified Party the amount of the Loss within
     ten Business Days of receipt by the Indemnifying Party of a notice
     reasonably itemizing the amount of the Loss but only to the extent actually
     paid or suffered by the Indemnified Party.

          (g) In the event a Third Party Claim is brought in which the liability
     as between the Purchaser and an Occidental Party or its Affiliates is
     alleged to be joint or in which the entitlement to indemnification under
     this Section 10 has not been determined, the Purchaser and the appropriate
     Occidental entity shall cooperate in the joint defense of such Third Party
     Claim and shall offer to each other such assistance as may reasonably be
     requested in order to ensure the proper and adequate defense of any such
     matter. Such joint defense shall be under the general management and
     supervision of the Party which is expected to bear the greater share of the
     liability, unless otherwise agreed; provided, however, that no Party shall
     settle or compromise any such joint defense matter without the consent of
     the other Parties, which consent shall not be unreasonably withheld or
     delayed. Any uninsured costs of such joint defense shall be borne as the
     Parties may agree, provided, however, that in the absence of such
     agreement, the defense costs shall be borne by the Party incurring such
     costs; provided, further, that, if it is determined that one Party was
     entitled to indemnification under this Section 10, the other Parties shall
     reimburse the Party entitled to indemnification for all of its costs
     incurred in connection with such defense.

     10.8 Termination of Indemnification. The obligations to indemnify and hold
harmless any Party pursuant to Section 10.2 and 10.3 shall terminate when the
applicable representation, warranty or covenant terminates pursuant to the terms
of this Agreement; provided, however, that such obligations to indemnify and
hold harmless shall not terminate with respect to any item as to which the
Person to be indemnified shall have, before the expiration of the applicable
period, previously made a claim by delivering a notice of such claim pursuant to
Section 10.7 to the Indemnifying Party (which notice shall identify the
representation or warranty claimed to have been inaccurate, or the covenant
claimed to have been breached, and shall state with reasonable particularity the
nature of the asserted inaccuracy or breach).

                                       27

<PAGE>

                                   SECTION 11
                                  MISCELLANEOUS

     11.1 Successors and Assigns. No Party may assign or delegate any of its
rights or obligations under this Agreement without the prior written consent of
all of the other Parties, which consent shall be in the sole and absolute
discretion of each such Party. Any purported assignment or delegation without
such consent shall be void and ineffective. This Agreement shall be binding upon
and inure to the benefit of the successors of each of the Parties.

     11.2 Benefits of Agreement Restricted to Parties. This Agreement is made
solely for the benefit of the Parties, and no other Person (including each
Party's employees and stockholders) shall have any right, claim or cause of
action under or by virtue of this Agreement.

     11.3 Notices. All notices, requests and other communications (collectively,
the "Notices") made pursuant to this Agreement shall be in writing and signed
and correctly dated by the Party sending such Notice. All Notices shall be
delivered personally (by courier or otherwise) or by facsimile to the receiving
Party at the applicable address or facsimile number set forth below:

          If to the Purchaser:

                  Lyondell Chemical Company
                  1221 McKinney Street, Suite 700
                  Houston, Texas 77010
                  Attention: Gerald A. O'Brien
                  Telecopy Number:  713-309-7312

                  with a copy to:

                  Lyondell Chemical Company
                  1221 McKinney Street, Suite 700
                  Houston, Texas 77010
                  Attention: General Counsel
                  Telecopy Number: 713-652-4538

                  and:

                  Baker Botts L.L.P.
                  910 Louisiana Street
                  Houston, Texas 77002
                  Attention: Stephen A. Massad
                  Telecopy Number: 713-229-1522

                                       28

<PAGE>

          If to an Occidental Party:

                   such Occidental Party
                   c/o Occidental Chemical Holding Corporation
                   5005 LBJ Freeway
                   Dallas, TX  75244
                   Attention: General Counsel
                   Telecopy Number: 972-404-4155

          If to Occidental:

                   Occidental Petroleum Corporation
                   10889 Wilshire Boulevard
                   Los Angeles, CA 90024
                   Attention: General Counsel
                   Telecopy Number: 972-404-4155

Any Notice delivered personally shall be deemed to have been given on the date
it is so delivered, or upon attempted delivery if acceptance of delivery is
refused, and any Notice delivered by facsimile shall be deemed to have been
given on the first Business Day it is received by the addressee (or, if such
Notice is not received during regular business hours of a Business Day, at the
beginning of the next such Business Day). The address and facsimile numbers set
forth above may be changed by a Party by giving Notice of such change of address
or facsimile number in the manner set forth in this Section 11.3.

     11.4 Severability. In the event that any provision of this Agreement shall
finally be determined to be unlawful, such provision shall be deemed severed
from this Agreement and every other provision of this Agreement shall remain in
full force and effect. If the economic and legal substance of the transaction
contemplated hereby is affected in any materially adverse manner as to any of
the Parties, and the Parties cannot agree on a lawful substitute provision, the
adversely affected Party shall have the right to terminate this Agreement
immediately upon notice to the other Parties.

     11.5 Press Releases. Unless otherwise mutually agreed, no Party shall make
or authorize any public release of information regarding the Partnership or any
other matters contemplated by, or any provisions or terms of, this Agreement
except that (a) a press release or press releases in mutually agreed upon form
or forms shall be issued by the Parties as promptly as is practicable following
the execution of this Agreement, (b) the Parties may, after consultation with
each other, communicate with employees, customers, suppliers, stockholders,
lenders, lessors, and other particular groups as may be necessary or appropriate
and not inconsistent with the prompt consummation of the transactions
contemplated by this Agreement and (c) after consultation with the other
Parties, any Party may make any release that is required by any Legal
Requirement or stock exchange rule or as necessary for the assertion or
enforcement of contractual rights.

                                       29

<PAGE>

     11.6 Confidentiality Agreement.

          (a) Nothing in this Agreement shall be construed as impairing or
     otherwise limiting the obligations assumed pursuant to any confidentiality
     agreement between the parties hereto.

          (b) In addition to the obligations of each Party set forth in Section
     11.6(a), each Occidental Party, from and after the Closing, with respect to
     itself and to its Affiliates, agrees and covenants with the Purchaser that
     it will keep confidential, and cause its and its Affiliates' respective
     officers, directors, employees and advisors to keep confidential, all
     information provided after the Closing Date relating to the Occidental
     Partner Subs and all information relating to the operations and business of
     the Partnership, except, in each case, as required by applicable law or
     administrative process (to the extent so required) (in which case the
     legally obligated Occidental Party shall promptly notify the Purchaser and
     give the Purchaser an opportunity to oppose such disclosure) and except for
     information that is available to the public on the Closing Date, or
     thereafter becomes available to the public other than as a result of a
     breach of this Section 11.6(b). The covenants set forth in this Section
     11.6(b) shall be effective as of Closing Date and shall terminate ten years
     after the Closing Date.

     11.7 Entire Agreement. This Agreement sets forth the entire agreement and
understanding among the Parties as to the subject matter hereof and merges and
supercedes all their prior discussions, agreements and understandings related to
this subject matter.

     11.8 Construction. In construing this Agreement, the following principles
shall be followed: (i) no consideration shall be given to the captions of the
articles, sections, subsections or clauses, which are inserted for convenience
in locating the provisions of this Agreement and not as an aid in construction;
(ii) no consideration shall be given to the fact or presumption that any of the
Parties had a greater or lesser hand in drafting this Agreement; (iii) examples
shall not be construed to limit, expressly or by implication, the matter they
illustrate; (iv) the word "includes" and its syntactic variants mean "includes,
but is not limited to" and corresponding syntactic variant expressions; (v) the
plural shall be deemed to include the singular, and vice versa; (vi) references
in this Agreement to Sections, Appendices and Schedules shall be deemed to be
references to Sections of, and Appendices and Schedules to, this Agreement
unless the context shall otherwise require; (vii) all Appendices and Schedules
attached to this Agreement shall be deemed incorporated herein as if set forth
in full herein; (viii) the words "hereof", "herein" and "hereunder" and words of
similar import shall refer to this Agreement as a whole and not to any
particular provision of this Agreement; (ix) references to a Person are also to
its permitted successors and permitted assigns; and (x) unless otherwise
expressly provided, any agreement, instrument or statute defined or referred to
herein means such agreement, instrument or statute as from time to time amended,
modified or supplemented, including (in the case of agreements or instruments)
by waiver or consent and (in the case of statutes) by succession of comparable
successor statutes and references to all attachments thereto and instruments
incorporated therein.

                                       30

<PAGE>

     11.9  Counterparts. This Agreement may be executed in one or more
counterparts, each of which shall constitute an original, and all of which when
taken together shall constitute one and the same original document.

     11.10 Governing Law. The laws of the State of Delaware shall govern the
construction, interpretation and effect of this Agreement without giving effect
to any conflicts of law principles.

     11.11 Transaction Costs. Each Party shall be solely responsible for and
bear all of its own respective costs, fees and expenses.

     11.12 Amendment. All waivers, modifications, amendments or alterations of
this Agreement shall require the written approval of each of the Parties. Except
as provided in the preceding sentence, no action taken pursuant to this
Agreement, including any investigation by or on behalf of any Party, shall be
deemed to constitute a waiver by the Party taking such action or compliance with
any representations, warranties, covenants or agreements contained herein and in
any documents delivered or to be delivered pursuant to this Agreement and in
connection with the Closing. The waiver by any Party of a breach of any
provision of this Agreement shall not operate or be construed as a waiver of any
subsequent breach.

     11.13 Jurisdiction; Consent to Service of Process; Waiver. ANY JUDICIAL
PROCEEDING BROUGHT AGAINST ANY PARTY OR ANY DISPUTE UNDER OR ARISING OUT OF OR
IN CONNECTION WITH THIS AGREEMENT SHALL BE BROUGHT IN THE FEDERAL OR STATE
COURTS OF THE STATE OF DELAWARE, AND, BY EXECUTION AND DELIVERY OF THIS
AGREEMENT, EACH OF THE PARTIES ACCEPTS THE EXCLUSIVE JURISDICTION OF SUCH COURTS
AND IRREVOCABLY AGREES TO BE BOUND BY ANY JUDGMENT (AS FINALLY ADJUDICATED)
RENDERED THEREBY IN CONNECTION WITH THIS AGREEMENT. EACH OF THE PARTIES SHALL
APPOINT THE CORPORATION TRUST COMPANY, THE PRENTICE-HALL CORPORATION SYSTEM,
INC. OR A SIMILAR ENTITY (THE "AGENT") AS AGENT TO RECEIVE ON ITS BEHALF SERVICE
OF PROCESS IN ANY PROCEEDING IN ANY SUCH COURT IN THE STATE OF DELAWARE, AND
EACH OF THE PARTIES SHALL MAINTAIN THE APPOINTMENT OF SUCH AGENT (OR A
SUBSTITUTE AGENT) FROM THE DATE HEREOF UNTIL THE EARLIER OF THE CLOSING DATE OR
THE TERMINATION OF THIS AGREEMENT AND SATISFACTION OF ALL OBLIGATIONS HEREUNDER.
THE FOREGOING CONSENTS TO JURISDICTION AND APPOINTMENTS OF AGENT TO RECEIVE
SERVICE OF PROCESS SHALL NOT CONSTITUTE GENERAL CONSENTS TO SERVICE OF PROCESS
IN THE STATE OF DELAWARE FOR ANY PURPOSE EXCEPT AS PROVIDED ABOVE AND SHALL NOT
BE DEEMED TO CONFER RIGHTS ON ANY PERSON OTHER THAN THE PARTIES. EACH PARTY
HEREBY WAIVES ANY OBJECTION IT MAY HAVE BASED ON LACK OF PERSONAL JURISDICTION,
IMPROPER VENUE OR FORUM NON-CONVENIENS.

                                       31

<PAGE>

     11.14 Waiver of Jury Trial. EACH PARTY HEREBY KNOWINGLY AND INTENTIONALLY,
IRREVOCABLY AND UNCONDITIONALLY WAIVES TRIAL BY JURY IN ANY LEGAL ACTION OR
PROCEEDING UNDER OR ARISING OUT OF OR IN CONNECTION WITH THIS AGREEMENT AND FOR
ANY COUNTERCLAIM THEREIN.

     11.15 Special Joinder by Oxy LP2. Oxy LP2 is a party to this Agreement for
the sole purpose of evidencing its agreement to be bound by the provisions set
forth in Section 6.8 and shall not have any rights under this Agreement or any
other obligations under this Agreement.

     11.16 Special Joinder by Occidental. Occidental is a party to this
Agreement for the sole purpose of evidencing its agreement to be bound by the
provisions set forth in Sections 6.6, 6.8, 7, 10.4 and 10.7 and shall not have
any rights under this Agreement or any other obligations under this Agreement.

     11.17 Further Assurances. From time to time, at the request of any other
Party, each Party shall execute and deliver or cause to be executed and
delivered such additional documents and instruments and take all such further
action as may be necessary or desirable to consummate the transactions
contemplated by this Agreement.

                                       32

<PAGE>

     IN WITNESS WHEREOF, this Occidental Partner Sub Purchase Agreement has been
executed on behalf of each of the Parties, by their respective officers
thereunto duly authorized, effective as of the date first written above.

                                  LYONDELL CHEMICAL COMPANY

                                        /s/ T. Kevin DeNicola
                                  By:  ________________________________________
                                       Name:   T. Kevin DeNicola
                                       Title:  Senior Vice President, Chief
                                               Financial Officer

                                  OCCIDENTAL CHEMICAL HOLDING CORPORATION

                                        /s/ James R. Havert
                                  By:  ________________________________________
                                       Name:  James R. Havert
                                       Title: Vice President and Treasurer

                                  OXY CH CORPORATION

                                        /s/ James R. Havert
                                  By:  ________________________________________
                                       Name:  James R. Havert
                                       Title: Vice President and Treasurer

                                  OCCIDENTAL CHEMICAL CORPORATION

                                        /s/ James R. Havert
                                  By:  ________________________________________
                                       Name:  James R. Havert
                                       Title: Vice President and Treasurer

<PAGE>

                                  SPECIAL JOINDER PURSUANT TO
                                  SECTION 11.15

                                  OCCIDENTAL PETROCHEM PARTNER 2, INC.

                                        /s/ James R. Havert
                                  By:  ________________________________________
                                       Name:  James R. Havert
                                       Title: Vice President and Treasurer

                                  SPECIAL JOINDER PURSUANT TO
                                  SECTION 11.16

                                  OCCIDENTAL PETROLEUM CORPORATION

                                        /s/ James R. Havert
                                  By:  ________________________________________
                                       Name:  James R. Havert
                                       Title: Vice President and Treasurer

<PAGE>

                                   APPENDIX A
                                       TO
                    OCCIDENTAL PARTNER SUB PURCHASE AGREEMENT

                                   DEFINITIONS

         "$75 Million Note" shall mean that certain Unsecured Promissory Note
dated as of the Closing Date by OCHC in the amount of $75 million.

         "1999 Indemnity Letter Agreement" shall mean the Letter Agreement dated
as of February 16, 1999 between the Partnership and OCC providing for the OCC
Indemnity.

         "1999 OCC Indemnity" shall have the meaning set forth in the 1999
Indemnity Letter Agreement.

         "Affiliate" shall mean any Person that, directly or indirectly through
one or more intermediaries, controls or is controlled by or is under common
control with the Person specified; provided, however, that for purposes of this
Agreement neither the Partnership nor any entity controlled by it shall be
considered an Affiliate of the Purchaser or of an Occidental Party. For purposes
of this definition, the term "control" shall have the meaning set forth in 17
CFR 230.405, as in effect on the date hereof.

         "Affiliated Group" shall mean any affiliated group within the meaning
of Section 1504(a) of the Code or any similar group defined under a similar
provision of state, local or foreign law.

         "Agent" shall have the meaning set forth in Section 11.13.

         "Agreement" shall mean this Occidental Partner Sub Purchase Agreement
entered into between the Parties as of the date hereof.

         "Alternate Cash Consideration" shall mean the greatest of: (a) a cash
payment equal to 5.4 million shares of Lyondell Common Stock multiplied by the
Applicable Price of such shares on the effective date of the Lease Termination
Event; provided, however, that such cash payment obligation may be satisfied in
accordance with the terms of Section 5.8 of the Securities Purchase Agreement;
or (b) if there is a No Rebuilding Termination, the Proceeds.

         "Applicable Price" shall mean, for any shares at any date, the average
of the Daily Prices for such shares for the 10 consecutive Business Days
immediately preceding such date.

         "Appraisal" shall mean the American Appraisal Associates appraisal of
the Lake Charles Facility prepared for Occidental dated February 21, 2002.

         "Authority" shall mean any government or governmental or regulatory
body thereof, or political subdivision thereof, whether federal, state, local or
foreign, or any agency, department or instrumentality thereof, or any court or
arbitrator (public or private).

                                       A-1

<PAGE>

         "Business Day" shall mean any day the New York Stock Exchange, Inc. is
open for business.

         "CITGO" shall have the meaning set forth in Section 6.9(a)(ii).

         "Closing" shall mean the closing of the transactions contemplated by
this Agreement.

         "Closing Date" shall have the meaning set forth in Section 3.1.

         "Code" shall mean the Internal Revenue Code of 1986, as amended.

         "Consent" shall mean any consent, waiver, approval, authorization,
exemption, registration, license or declaration of or by any other Person or any
Authority, or any expiration or termination of any applicable waiting period
under any Legal Requirement, required with respect to any Party in connection
with (i) the execution and delivery of this Agreement or (ii) the consummation
of any of the transactions provided for hereby.

         "Daily Price" shall mean, on any day, the average (calculated to the
nearest thousandth) of the high and low per share sales prices of Lyondell
Common Stock for such day for sales conducted regular way on the New York Stock
Exchange, Inc., as such prices are reported on www.nysenet.com or, if not
reported thereby, another authoritative source.

         "Encumbrance" shall mean any preferential right, lien, charge,
encumbrance, security interest, title defect, option or any other restriction or
third-party right.

         "Escrow Agent" shall mean The Bank of New York.

         "Escrow Agreement" shall mean that certain Escrow Agreement
substantially in the form of Exhibit A to be entered into as of the Closing Date
between the Escrow Agent, OCHC and the Purchaser.

         "Filing" shall mean any filing with any Person or any Authority
required with respect to any Party in connection with (i) the execution and
delivery of this Agreement or (ii) the consummation of any of the transactions
provided for hereby.

         "First OCC Interim Indemnity" shall have the meaning set forth in the
1999 Indemnity Letter Agreement.

         "GAAP" shall mean United States generally accepted accounting
principles.

         "Government License" shall mean, with respect to any Person, all
licenses, permits or franchises issued by any Authority relating to the
operation, development, use, maintenance or occupancy of the facilities or any
other asset of such Person's business to the extent that such licenses, permits
or franchises relate principally to the normal operation and conduct of such
Person's business.

         "HSR Act" shall mean the Hart-Scott-Rodino Antitrust Improvements Act
of 1976, as amended.

                                       A-2

<PAGE>

         "Indemnified Parties" shall mean the Purchaser Indemnified Parties and
the Occidental Indemnified Parties.

         "Indemnifying Parties" shall mean the Party against whom indemnity is
sought.

         "Knowledge" shall mean with respect to any Party, the actual knowledge
of any of its corporate officers.

         "Lake Charles Facility" means the Plant Site, Plant, Pipeline and the
Other Assets (each as defined in the LC Lease).

         "LC Lease" shall mean that certain Lease Agreement dated May 15, 1998
between OCC, as lessor, and Oxy LP1, as lessee.

         "Lease Termination Event" shall mean any time that the LC Lease is
terminated, expires or is otherwise not in force and effect (other than a No
Rebuilding Termination), as such is interpreted in the Partnership Agreement.

         "Legal Requirement" shall mean any law, statute, rule, ordinance,
decree, regulation, requirement, temporary or permanent injunction order or
judgment of any Authority including the terms of any Government License.

         "Loss" shall have the meaning set forth in Section 10.2(a).

         "Lyondell" shall mean Lyondell Chemical Company, a Delaware
corporation.

         "Lyondell Common Stock" shall mean the shares of common stock of
Lyondell that are traded on the New York Stock Exchange, Inc.

         "Make Whole Amount" shall have the meaning set forth in Section 6.9(e).

         "Millennium" shall mean Millennium Chemicals, Inc., a Delaware
corporation.

         "No Rebuilding Termination" shall have the meaning set forth in the
Partnership Agreement.

         "Notice" shall have the meaning set forth in Section 11.3.

         "OCC" shall have the meaning set forth in the preamble to this
Agreement.

         "OCC Indemnity" shall mean at any time whichever, if any, is then
outstanding of the 1999 OCC Indemnity, the First OCC Interim Indemnity and the
Second OCC Interim Indemnity.

         "Occidental" shall mean Occidental Petroleum Corporation, a Delaware
corporation.

         "Occidental Affiliated Group" shall have the meaning set forth in
Section 4.7(h).

                                       A-3

<PAGE>

         "Occidental Indemnified Parties" shall mean the Occidental Parties and
their Affiliates and each of their respective officers, directors, employees,
stockholders, agents and representatives.

         "Occidental Material Adverse Change" shall mean a material adverse
change in the financial condition, results of operations, assets or business of
the Partnership or the Occidental Partner Subs (including their interest in the
Partnership), taken as a whole, excluding changes resulting from (i) economic or
political conditions that affect the world or any regional economy generally,
(ii) any change in raw materials prices, product prices or industry capacity or
(iii) any other matter of industry-wide application that affects the Partnership
and industry participants whose businesses are comparable thereto in a
substantially similar way.

         "Occidental Material Adverse Effect" shall mean any adverse
circumstance or consequence that, individually or in the aggregate, has an
effect that is material to (i) the financial condition, results of operations,
assets or business of the Occidental Partner Subs (including their interest in
the Partnership), taken as a whole or (ii) the ability of Occidental or any
Occidental Party to perform its obligations under this Agreement.

         "Occidental Parent" shall have the meaning set forth in the recitals to
this Agreement.

         "Occidental Parties" shall mean OCHC, Oxy CH and OCC and, for purposes
of Sections 6.6, 6.9, 7, 10.4 and 10.7, Occidental and, for purposes of Section
6.8, Oxy LP2.

         "Occidental Partner Subs" shall have the meaning set forth in the
recitals to this Agreement.

         "OCHC" shall have the meaning set forth in the preamble to this
Agreement.

         "Oxy CH" shall have the meaning set forth in the preamble to this
Agreement.

         "Oxy GP" shall have the meaning set forth in the recitals to this
Agreement.

         "Oxy GP Shares" shall mean all of the issued and outstanding shares of
common stock, par value $1.00 per share, of Oxy GP as of the date hereof.

         "Oxy LP1" shall have the meaning set forth in the recitals to this
Agreement.

         "Oxy LP1 Interests" shall mean all of the issued and outstanding
limited liability company interests of Oxy LP1 as of Closing.

         "Oxy LP1 Shares" shall mean all of the issued and outstanding shares of
common stock, par value $1.00 per share, of Oxy LP1 as of the date hereof.

         "Oxy LP2" shall have the meaning set forth in the recitals to this
Agreement.

         "Oxy LP2 Shares" shall mean all of the issued and outstanding shares of
common stock, par value $1.00 per share, of Oxy LP2 as of Closing.

                                       A-4

<PAGE>

         "Parent" shall have the meaning set forth in the recitals to this
Agreement.

         "Parent Agreement" shall mean the Amended and Restated Parent Agreement
dated May 15, 1998 among OCC, Oxy CH, Occidental, Lyondell, Millennium and the
Partnership, as amended by a First Amendment to Amended and Restated Parent
Agreement dated June 30, 1998 and modified by an Assignment and Assumption
Agreement dated June 19, 1998 among OCC, Oxy CH and OCHC.

         "Parties" shall mean the Purchaser and the Occidental Parties.

         "Partner Sub Stock" shall mean (i) for purposes of the date hereof, the
Oxy LP1 shares, Oxy LP2 Shares and Oxy GP Shares and (ii) for purposes of the
Closing Date, the Oxy LP1 Interests, Oxy LP2 Shares and Oxy GP Interests.

         "Partnership" shall have the meaning set forth in the recitals to this
Agreement.

         "Partnership Agreement" shall mean the Amended and Restated Partnership
Agreement of the Partnership dated as of August 24, 2001.

         "Person" shall mean any natural person, corporation, partnership,
limited liability company, joint venture, association, trust or other entity or
organization.

         "Plant Put Option Agreement" shall mean that certain Option to Sell
Petrochemical Plant Agreement substantially in the form of Exhibit B to be
entered into as of the Closing Date between OCC and the Purchaser.

         "Plant ROFR" shall have the meaning set forth in Section 6.9(a)(i).

         "Plant Sale Agreement" shall mean that certain Purchase and Sale
Agreement for the Lake Charles Facility the form of which is attached to the
Plant Put Option Agreement.

         "Plant Transfer" shall mean the conveyance of the Lake Charles Facility
under and pursuant to the Plant Sale Agreement.

         "Pre-Closing Tax Period" shall have the meaning set forth in Section
7.3.

         "Proceeding" shall mean any action, suit, claim or legal,
administrative or arbitration proceeding or governmental investigation to which
any Party or an Affiliate is a party.

         "Proceeds" shall have the meaning set forth in the Partnership
Agreement.

         "Purchaser" shall have the meaning set forth in the preamble to this
Agreement.

         "Purchaser Indemnified Parties" shall mean the Purchaser and its
Affiliates and each of their respective officers, directors, employees,
stockholders, agents and representatives.

         "Purchaser Material Adverse Change" shall mean a material adverse
change in the financial condition, results of operations, assets or business of
the Purchaser and its Subsidiaries taken as a whole, excluding changes resulting
from (i) economic or political conditions that

                                      A-5

<PAGE>

affect the world or any regional economy generally, (ii) any change in raw
materials prices, product prices or industry capacity or (iii) any other matter
of industry-wide application that affects the Purchaser and its Subsidiaries
taken as a whole and industry participants whose businesses are comparable
thereto in a substantially similar way.

         "Purchaser Material Adverse Effect" shall mean any adverse circumstance
or consequence that, individually or in the aggregate, has an effect that is
material to (i) the financial condition, results of operations, assets or
business of the Purchaser and its Subsidiaries taken as a whole or (ii) the
ability of the Purchaser to perform its obligations under this Agreement.

         "Put Right" shall have the meaning set forth in Section 6.9(d).

         "Related Purchase Agreements" shall mean the Escrow Agreement, the
Plant Put Option Agreement and the $75 Million Note.

         "ROFRs" shall have the meaning set forth in Section 6.9(a)(i).

         "Second OCC Interim Indemnity" shall have the meaning set forth in the
1999 Indemnity Letter Agreement.

         "Section 14 Escrow" shall mean the escrow account established pursuant
to the Escrow Agreement attached hereto as Exhibit A and containing the $75
Million Note.

         "Subsidiary" shall mean, with respect to any Party, any Person of which
such Party, either directly or indirectly, owns 50% or more of the equity or
voting interests.

         "Tax" shall mean all taxes, charges, fees, levies or other assessment
imposed by any tax Authority, including, but not limited to, income, surtax,
remittance taxes, gross receipts, excise, profits, premium, property, sales,
use, transfer, occupation, employment, unemployment, disability, payroll,
license, ad valorem, value added, withholding, social security, registration,
national insurance (or other similar contributions or payments), stamp taxes,
customs duty, environmental taxes (including taxes under Section 59A of the
Code), capital stock, franchise, severance, alternative or add-on minimum tax,
estimated taxes, and any similar taxes (including any interest, fines, penalties
or additions attributable to, or imposed on or with respect to, any such taxes,
charges, fees, levies or other assessments).

         "Tax Return" shall mean any return, form, declaration, report, claim
for refund, or information return or statement relating to Taxes, including any
schedule or attachment thereto, and including any amendment thereof.

         "Termination Date" shall have the meaning set forth in Section 9.1(d).

         "Third Party Claim" shall mean any allegation, claim, civil or criminal
action, proceeding, charge or prosecution brought by a person other than the
Partnership, any of its partners or their respective Affiliates.

                                      A-6

<PAGE>

         "Transfer" shall mean to sell, assign or otherwise in any manner
dispose of, whether by act, deed, merger or otherwise. The defined term
"Transfer" is used herein both as a noun and as a verb.

         "Units" shall mean units representing interests in the Partnership as
provided for in the Partnership Agreement.

                                      A-7

<PAGE>

                                    SCHEDULES

                                       to

                    OCCIDENTAL PARTNER SUB PURCHASE AGREEMENT

1.2   ORGANIZATION, CAPITALIZATION, TITLE

      1.2(a) and (b) Organization, Capitalization and Title - Oxy LP1:

             OXY LP1: Occidental Petrochem Partner 1, Inc.

                      Delaware limited liability company

                      [capitalization to come before Closing]

      1.2(d) Encumbrances - Partner Sub Stock at Closing:

             Section 14 of the Partnership Agreement

             The Parent Agreement

2.2   ALLOCATION OF PURCHASE PRICE

      Amount to be delivered at Closing:

             OCC      $ 98,783,728.81

             Oxy CH    341,226,271.19
                      ===============

             Total    $440,010,000.00

4     EXCEPTIONS TO REPRESENTATIONS AND WARRANTIES OF OCCIDENTAL PARTIES

      4.5(a) and (b) Organization, Capitalization and Title - Occidental Partner
      Subs at Signing:

             OXY LP1: Occidental Petrochem Partner 1, Inc.

                      Delaware corporation

                      1000 shares of common stock, par value $1.00, issued and
                      outstanding.

                                  Schedules-1

<PAGE>

              OXY LP2:  Occidental Petrochem Partner 2, Inc.

                        Delaware corporation

                        1000 shares of common stock, par value $1.00, issued and
                        outstanding.

              OXY GP:   Occidental Petrochem Partner GP, Inc.

                        Delaware corporation

                        1000 shares of common stock, par value $1.00, issued and
                        outstanding.

       4.5(d) Encumbrances - Partner Sub Stock at Signing:

              Section 14 of the Partnership Agreement

              The Parent Agreement

       4.5(f) Contracts and Agreements:

              The Related Agreements (as defined in the Master Transaction
              Agreement dated May 15, 1998 between the Partnership, Occidental,
              Lyondell and Millennium) to which an Occidental Partner Sub is a
              party.

       4.6    Encumbrances and Transfer Restrictions - Units:

              The Partnership Agreement

4.6    PARTNERSHIP UNITS

       OXY LP1:      6,623 Units

       OXY LP2:     22,876 Units

       OXY GP:           1 Unit

4.7(e) TAX BASIS

       OXY LP1:      (i)    $0
                     (ii)   $0
                     (iii)  $0

       OXY LP2:      (i)    $0
                     (ii)   $0
                     (iii)  $0

                                   Schedules-2

<PAGE>

       OXY LP3:  (i)      $0
                 (ii)     $0
                 (iii)    $0

5      EXCEPTIONS TO REPRESENTATIONS AND WARRANTIES OF THE PURCHASER

       None.

5.5    FINANCING

       The Securities Purchase Agreement dated July 8, 2002 between Lyondell and
       OCHC providing for the sale of Lyondell securities and contingent
       consideration to OCHC for an aggregate purchase price of $440,000,000.

8.2(d) OCCIDENTAL CONSENTS

       None.

8.3(e) PURCHASER CONSENTS

       None.

                                   Schedules-3TRUST AGREEMENT

                  TRUST AGREEMENT, between MSDW Structured Asset Corp. (the
"Depositor") and LaSalle Bank National Association (the "Trustee"), made as of
the date set forth in Schedule I attached hereto, which Schedule together with
Schedules II and III attached hereto, are made a part hereof and are hereinafter
referred to collectively as the "Terms Schedule". The terms of the Standard
Terms for Trust Agreements, dated July 7, 1999 (the "Standard Terms") are,
except to the extent otherwise expressly stated, hereby incorporated by
reference herein in their entirety with the same force and effect as though set
forth herein. Capitalized terms used herein and not defined shall have the
meanings defined in the Standard Terms. References to "herein", "hereunder",
"this Trust Agreement" and the like shall include the Terms Schedule attached
hereto and the Standard Terms so incorporated by reference.

                  WHEREAS, the Depositor and the Trustee desire to establish the
Trust identified in Schedule I attached hereto (the "Trust") for the primary
purposes of (i) holding the Securities, (ii) entering into any Swap Agreement
with the Swap Counterparty and (iii) issuing the Units;

                  WHEREAS, the Depositor desires that the respective beneficial
interests in the Trust be divided into transferable fractional shares, such
shares to be represented by the Units; and

                  WHEREAS, the Depositor desires to appoint the Trustee as
trustee of the Trust and the Trustee desires to accept such appointment;

                  WHEREAS, the Depositor shall transfer, convey and assign to
the Trust without recourse, and the Trust shall acquire, all of the Depositor's
right, title and interest in and under the Securities and other property
identified in Schedule II to the Trust Agreement (the "Trust Property"); and

                  WHEREAS, the Trust agrees to acquire the Trust Property
specified herein in consideration for Units having an initial Unit Principal
Balance identified in Schedule I attached hereto, subject to the terms and
conditions specified in the Trust Agreement;

                  NOW THEREFORE, the Depositor hereby appoints the Trustee as
trustee hereunder and hereby requests the Trustee to receive the Securities from
the Depositor and to issue in accordance with the instructions of the Depositor
Units having the terms specified in Schedule I attached hereto, and the Trustee
accepts such appointment and, for itself and its successors and assigns, hereby
declares that it shall hold all the estate, right, title and interest in any
property contributed to the trust account established hereunder (except property
to be applied to the payment or reimbursement of or by the Trustee for any fees
or expenses which under the terms hereof is to be so applied) in trust for the
benefit of all present and future Holders of the fractional shares of beneficial
interest issued hereunder, namely, the Unitholders, and subject to the terms and
provisions hereof and of the Standard Terms.

                  IN WITNESS WHEREOF, each of the undersigned has executed this
instrument as of the date set forth in the Terms Schedule attached hereto.

                               LASALLE BANK NATIONAL ASSOCIATION
                                   as Trustee on behalf of the Trust identified
                                   in Schedule I hereto, and not in its
                                   individual capacity

                               By: /s/ Brian D. Ames
                                   --------------------------
                                   Name:  Brian D. Ames
                                   Title: Vice President

                               MSDW STRUCTURED ASSET CORP.

                               By: /s/ John Kehoe
                                   --------------------------
                                   Name:  John Kehoe
                                   Title: Vice President

Attachments: Terms Schedule (consisting of Schedules I, II and III)

<PAGE>

                                   Schedule I
                           (Terms of Trust and Units)

Trust:                               SATURNS Trust No. 2002-7

Date of Trust Agreement:             July 9,  2002

Trustee:                             LaSalle Bank National Association.
                                     References to Chase Bank of Texas, National
                                     Association in the Standard Terms shall be
                                     inapplicable.

Units:                               The Trust will issue two classes of Units:
                                     the Class A Units and the Class B Units.
                                     Only the Class A Units will be publicly
                                     offered.

Initial Unit Principal Balance
of the Class A Units:                $25,000,000

Initial Notional Amount
of the Class B Units:                $25,000,000

Issue Price of Units:                Class A Units:  100%

                                     Class B Units: $463,000

Number of Units:                     Class A Units:

                                     1,000,000 (Unit Principal Balance of $25
                                     each)

                                     Class B Units:

                                     Initially, one (1) Unit representing 100%
                                     of the Notional Amount of the Class B Units

Minimum Denomination:                Class A Units:

                                     $25 and $25 increments in excess thereof.
                                     The minimum denomination specified in
                                     Section 5.01(a) of the Standard Terms shall
                                     not apply. Each $25 of Unit Principal
                                     Balance is a Unit.

                                     Class B Units:

                                     The entire Notional Amount of such class;
                                     provided, that, the Class B Units may be
                                     held in lesser Notional Amounts if acquired
                                     in connection with a purchase of less than
                                     100% of the call rights under the Swap
                                     Agreement if the percentage of Class B
                                     Units (as a percentage of all Class B
                                     Units) acquired is equal to the percentage
                                     of call rights (as a percentage of all call
                                     rights) acquired. Such Class B Unit
                                     representing such percentage may be
                                     transferred (and subsequently transferred)
                                     in whole only unless transferred in
                                     connection with a transfer of a lesser
                                     amount of call rights under the Swap
                                     Agreement. The minimum denomination
                                     specified in Section 5.01(a) of the
                                     Standard Terms shall not apply.

Cut-off Date:                        July 9, 2002

Closing Date:                        July 9, 2002

Specified Currency:                  United States dollars

Business Day:                        New York, New York and Chicago, Illinois

Interest Rate:                       Class A Units:

                                     7.875% per annum on the basis of a 360 day
                                     year consisting of twelve 30 day months.
                                     During an extension period with respect to
                                     the securities, while interest will
                                     continue to accrue on the Unit Principal
                                     Balance at 7.875% per annum and interest
                                     will accrue on any deferred interest at
                                     7.875% per annum.

Class B Unit Units:                  0.197% per annum on the basis of a 360 day
                                     year consisting of twelve 30 day months.
                                     During an extension period with respect to
                                     the securities, interest will continue to
                                     accrue on the Unit Notional Amount at
                                     0.197% per annum and interest will accrue
                                     on any deferred interest at a rate equal to
                                     8.125% per annum.

                                     The right of the Class A Units to interest
                                     is pari passu with the right of the Class B
                                     Units to interest.

                                     The Class B Units are also entitled to the
                                     Class B Unit Payment Obligation of the Swap
                                     Counterparty specified in Schedule III.
                                     Payment of the Class B Unit Payment
                                     Obligation shall result in a reduction of
                                     the Notional Amount of the Class B Units
                                     equal to the Class B Unit Corresponding
                                     Portion.

Interest Reset Period:               Not Applicable

Rating:                              Class A Units and Class B Units:

                                     Baa2 by Moody's

                                     BBB- by S&P

Rating Agencies:                     Moody's and S&P

Scheduled Final Distribution Date:   September 1, 2031. The Units will have the
                                     same final maturity as the Securities.

Prepayment/Redemption:               The Trust Property is subject to redemption
                                     in accordance with the terms of the
                                     Securities and as described in Schedule II
                                     and is subject to call in accordance with
                                     Schedule III. Any such call or redemption
                                     will cause a redemption of a corresponding
                                     portion of the Class A Units and a
                                     reduction in the Notional Amount of the
                                     Class B Units.

                                     If the rights under the Swap Agreement are
                                     partially exercised or if there is a
                                     partial redemption of the Securities, the
                                     Trustee will randomly select Units to be
                                     redeemed in full from the proceeds of such
                                     partial exercise of the Swap Agreement or
                                     partial redemption of the Securities.

Additional Distribution:             If any of the Securities are redeemed by
                                     the Security Issuer prior to July 9, 2007,
                                     each of the Class A Units being redeemed in
                                     connection with such redemption of
                                     Securities (or related exercise of the
                                     rights under the Swap Agreement) will
                                     receive a pro rata distribution from the
                                     proceeds of the redemption of the
                                     Securities remaining after payment of
                                     principal and interest on the Class A Units
                                     up to a maximum of $2.50 per Class A Unit.

Corporate Trust Office:              The definition of "Corporate Trust Office"
                                     in the Standard Terms shall not apply.

                                     The Corporate Trust Office shall be the
                                     Trustee's Asset-Backed Securities Trust
                                     Services Group having an office at 135 S.
                                     LaSalle Street, Suite 1625, Chicago,
                                     Illinois 60603 or such other addresses as
                                     the Trustee may designate from time to time
                                     by notice to the Unitholders, the
                                     Depositor, the Swap Counterparty and the
                                     Guarantor.

Swap Agreement:                      The ISDA Agreement referred to in Schedule
                                     III. In addition, in connection with an
                                     additional issuance of Units, any
                                     additional Swap Agreement entered into in
                                     connection therewith.

Swap Counterparty:                   Party A to the Swap Agreement referred to
                                     in Schedule III or any assignee thereof. In
                                     addition, in connection with an additional
                                     issuance of Units, Party A to any
                                     additional Swap Agreement or any assignee
                                     thereof.

                                     In the event that there is more than one
                                     Swap Counterparty at any time when a
                                     partial redemption of the Securities
                                     occurs, the Trustee shall randomly select
                                     which options under the Swap Agreements
                                     shall be selected for exercise or
                                     termination (and receipt of a Swap
                                     Termination Payment).

Guaranty:                            Morgan Stanley (the "Guarantor") shall
                                     guarantee the obligations of Morgan Stanley
                                     & Co. International Limited ("MSIL") for so
                                     long as MSIL is Party A to any Swap
                                     Agreement with the Trust.

Swap Notional Amount:                The notional amount specified in Schedule
                                     III.

Swap Payment Date:                   Not Applicable

Swap Rate:                           Not Applicable

Additional Swap Agreements:          In connection with an additional issuance
                                     of Units, the Depositor may arrange for the
                                     Trust to enter into an additional Swap
                                     Agreement with identical terms to those of
                                     the Swap Agreement entered into as of the
                                     Closing Date with an additional Swap
                                     Counterparty, except that such Swap
                                     Agreement may have a different Swap
                                     Counterparty, number of options, and
                                     premium amount than the Swap Agreement
                                     entered into on the Closing Date. The
                                     Rating Agency Condition must be satisfied
                                     with respect to such additional Swap
                                     Agreement.

Distribution Date:                   Each March 1 and September 1, commencing
                                     September 1, 2002.

                                     If any payment with respect to the
                                     Securities held by the Trust is not
                                     received by the Trustee by 12 noon (New
                                     York City time) on a Distribution Date, the
                                     corresponding distribution on the Units
                                     will not occur until the next Business Day
                                     that the Trust is in receipt of proceeds of
                                     such payment prior to 12 noon, with no
                                     adjustment to the amount distributed.

Record Date:                         Each February 15 and August 15, regardless
                                     of whether such day is a Business Day.

Form:                                Global Security

Depositary:                          DTC

Trustee Fees and Expenses:           As compensation for and in payment of trust
                                     expenses related to its services hereunder
                                     other than Extraordinary Trust Expenses,
                                     the Trustee will receive Trustee Fees on
                                     each Distribution Date in the amount equal
                                     to $3,750. The Trustee Fee shall cease to
                                     accrue after termination of the Trust. The
                                     "Trigger Amount" with respect to
                                     Extraordinary Trust Expenses for the Trust
                                     is $25,000 and the Maximum Reimbursable
                                     Amount is $100,000. The Trustee Fee will be
                                     paid by the Expense Administrator. Expenses
                                     will be reimbursed by the Expense
                                     Administrator in accordance with the
                                     Expense Administration Agreement.

Expense Administrator:               The Depositor will act as Expense
                                     Administrator on behalf of the Trust
                                     pursuant to an Expense Administration
                                     Agreement, dated as of the date of the
                                     Trust Agreement (the "Expense
                                     Administration Agreement"), between the
                                     Depositor as Expense Administrator (the
                                     "Expense Administrator") and the Trust.

                                     The Expense Administrator will receive a
                                     fee equal to 0.06% per annum of the
                                     principal amount of the Securities held by
                                     the Trust as its fee, payable on the basis
                                     of a 360 day year consisting of twelve 30
                                     day months. The Expense Administrator will
                                     be entitled to interest on any deferred fee
                                     amounts that would have been payable but
                                     for deferral of interest on the Securities
                                     at the rate of 8.125% per annum and any
                                     additional amounts available as interest on
                                     deferred interest with respect to the
                                     Securities after application of such
                                     amounts to the deferred interest payable on
                                     the Units. The Expense Administrator's fee
                                     is payable only from available interest
                                     receipts received with respect to the
                                     Securities after application of such
                                     receipts to payment of accrued interest on
                                     the Units and any Swap Termination Payments
                                     currently owing. The Expense Administrator
                                     will be entitled to its fee in connection
                                     with an exercise of the Options or a
                                     redemption of the Securities. The Expense
                                     Administrator will not be entitled to
                                     receive its fee from the proceeds of a
                                     termination other than in connection with
                                     an exercise of Options or a redemption of
                                     Securities.

                                     The Expense Administrator will be
                                     responsible for paying the Trustee Fee and
                                     reimbursing certain other expenses of the
                                     Trust in accordance with the Expense
                                     Administration Agreement.

Listing:                             The Depositor has applied to list the Class
                                     A Units on the New York Stock Exchange

ERISA Restrictions:                  None of the restrictions in the Standard
                                     Terms relating to the Employee Retirement
                                     Income Security Act of 1974, as amended,
                                     and related matters shall apply to the
                                     Class A Units.

                                     The restrictions shall apply to the Class B
                                     Units and no ERISA Benefit Plan may acquire
                                     an interest in the Class B Units.

Alternative ERISA Restrictions:      Not Applicable

Deemed Representations:              Not Applicable

QIB Restriction:                     Applicable to the Class B Units. Not
                                     applicable to the Class A Units.

Trust Wind-Up Event:                 The Trust Wind-Up Events specified in
                                     Sections 9.01(a), 9.01(c), 9.01(d), 9.01(f)
                                     and 9.01(h) shall not apply. The Trust Wind
                                     Events specified in Sections 9.01(b)
                                     (Security Default), 9.01(e) (Early
                                     Termination Date designated due to
                                     "illegality" or "tax event" under the Swap
                                     Agreement), 9.01(g) (Disqualified
                                     Securities), 9.01(i) (Excess Expense Event)
                                     shall apply. Pursuant to Section 9.01(j),
                                     the following events also shall constitute
                                     Trust Wind-Up Events: (i) redemption by the
                                     Security Issuer of all Securities held by
                                     the Trust and (ii) exercise of the call
                                     rights under the Swap Agreement as to all
                                     Securities held by the Trust.

                                     If (i) cash settlement applies under the
                                     Swap Agreement, (ii) a Trust Wind-Up Event
                                     has occurred in connection with the
                                     exercise of any Option under the Swap
                                     Agreement and (iii) the Selling Agent
                                     cannot obtain a bid for the Securities in
                                     excess of 100% of the aggregate Unit
                                     Principal Balance of the Class A Units and
                                     accrued interest on the Securities, then
                                     the Securities will not be sold, the Swap
                                     Counterparty's exercise of the call option
                                     will be rescinded (and the Swap
                                     Counterparty shall be entitled to exercise
                                     such options in the future) and any related
                                     Trust Wind-Up Event will be deemed not to
                                     have occurred.

Termination:                         If a Trust Wind-Up Event occurs, any
                                     Securities held by the Trust will be
                                     liquidated (by delivery to the Security
                                     Issuer in the event of a redemption).

                                     If a Trust Wind-Up Event occurs due to a
                                     redemption of the Securities by the
                                     Security Issuer or exercise of the call
                                     rights under the Swap Agreement as to all
                                     Securities held by the Trust, (i) amounts
                                     received as accrued interest on the
                                     Securities will be applied to the Class A
                                     Units and the Class B Units pro rata in
                                     proportion to the amount of accrued
                                     interest outstanding on each such Class,
                                     (ii) amounts received as principal or par
                                     on the Securities will be applied to the
                                     Unit Principal Balance of the Class A Units
                                     up to 100% of the Unit Principal Balance of
                                     each Class A Unit, and (iii) if prior to
                                     July 9, 2007, any amount received as a
                                     make-whole premium or redemption premium on
                                     the Securities will be applied to the Class
                                     A Units up to $2.50 per Class A Unit.
                                     Remaining accrued interest will be applied
                                     to the Expense Administrator's fee. Any
                                     remaining amounts (other than the Class B
                                     Unit Payment Obligation of the Swap
                                     Counterparty) will be paid to the Swap
                                     Counterparty as a Swap Termination Payment
                                     under the Swap Agreement. Amounts in
                                     respect of the Class B Unit Payment
                                     Obligation of the Swap Counterparty (as
                                     described in Schedule III) shall be paid to
                                     the Class B Units.

                                     If the Trust is terminated for any other
                                     reason, the proceeds of liquidation will be
                                     applied to redeem the Class A Units and the
                                     Class B Units. The Class A Units will have
                                     a claim on the proceeds of the liquidation
                                     equal to their aggregate Unit Principal
                                     Balance plus accrued interest. The Class B
                                     Units will have a claim on the proceeds of
                                     liquidation equal to the value calculated
                                     (x) by discounting each remaining scheduled
                                     payment at a rate of 8.125% (on the basis
                                     of a 360 day consisting of twelve 30 day
                                     months) and adding (y) accrued interest. If
                                     the proceeds of the liquidation is less
                                     than the combined claim amounts of the
                                     Class A Units and the Class B Units, the
                                     proceeds will be distributed in proportion
                                     to the claim amounts of the Class A Units
                                     and the Class B Units in full satisfaction
                                     of the claims of the Units. If the proceeds
                                     of liquidation exceed the claims of the
                                     Class A Units and the Class B Units, the
                                     excess will be paid to the Swap
                                     Counterparty as a Swap Termination Payment
                                     under the Swap Agreement.

Self-Tenders by Security Issuer:     The Trust will not participate in any
                                     self-tender by the Security Issuer for the
                                     Securities and the Trustee will not accept
                                     any instructions to the contrary from the
                                     Unitholders.

Terms of Retained Interest:          The Depositor retains the right to receive
                                     any and all interest that accrues on the
                                     Securities prior to the Closing Date. The
                                     Depositor will receive such accrued
                                     interest on the first Distribution Date for
                                     the Units and such amount shall be paid
                                     from the interest payment made with respect
                                     to the Securities on the first Distribution
                                     Date.

                                     The amount of the Retained Interest is
                                     $717,511.

                                     If a Security Default occurs on or prior to
                                     the first Distribution Date and the
                                     Depositor does not receive such Retained
                                     Interest amount in connection with such
                                     Distribution Date, the Depositor will have
                                     a claim for such Retained Interest, and
                                     will share pro rata with holders of the
                                     Units to the extent of such claim in the
                                     proceeds from the recovery on the
                                     Securities.

Call Option Terms:                   Not Applicable.

Security Default:                    The definition of Security Default in the
                                     Standard Terms shall not apply. A "Security
                                     Default" shall mean one of the following
                                     events: (i) the acceleration of the
                                     outstanding Securities under the terms of
                                     the Securities and/or the applicable
                                     Security Agreement and failure to pay the
                                     accelerated amount on the acceleration
                                     date; (ii) the failure of the Security
                                     Issuer (or the Security Guarantor on its
                                     behalf or under the Security Guaranty) to
                                     pay an installment of principal of, or any
                                     amount of interest due on, the Securities
                                     after the due date thereof and after the
                                     expiration of any applicable grace period;
                                     or (iii) the occurrence of any of the
                                     events of default under such Securities
                                     and/or Security Agreement relating to the
                                     insolvency or bankruptcy of the Security
                                     Issuer or the Security Guarantor.

Sale of Securities:                  If the Trust must sell the Securities it
                                     holds, the Trust will sell the Securities
                                     through the Selling Agent in accordance
                                     with Section 9.03(b) and the following
                                     terms. The Selling Agent must solicit at
                                     least three bids for all of the Securities
                                     held by the Trust. The Selling Agent must
                                     solicit at least three of such bids from
                                     registered broker-dealers of national
                                     reputation, but additional bids may be
                                     solicited from one or more financial
                                     institutions or other counterparties with
                                     credit worthiness acceptable to the Selling
                                     Agent in its discretion. The Selling Agent
                                     will, on behalf of the Trust, sell the
                                     Securities at the highest bid price
                                     received. The Selling Agent may not bid for
                                     the Securities.

                                     If cash settlement applies and if the Swap
                                     Counterparty exercises any of its Options
                                     other than in connection with a redemption
                                     of the Securities by the Security Issuer, a
                                     number of Securities corresponding to the
                                     number of Options exercised by the Swap
                                     Counterparty will be sold by the Selling
                                     Agent on behalf of the Trust.

                                     If the Selling Agent cannot obtain a bid
                                     for the Securities in excess of 100% of the
                                     aggregate Unit Principal Balance of the
                                     Class A Units to be redeemed and accrued
                                     interest on the Securities to be sold, then
                                     the Securities will not be sold, the Swap
                                     Counterparty's exercise will be rescinded
                                     (and the Swap Counterparty shall be
                                     entitled to exercise such Option(s) in the
                                     future) and any related Trust Wind-Up Event
                                     will be deemed not to have occurred.

Additional Issuance of Units:        Upon no less than 5 days' notice to the
                                     Trustee, the Depositor may deposit
                                     additional Securities at any time in
                                     exchange for additional Units in a minimum
                                     aggregate amount of $250,000 (with respect
                                     to the Class A Units issued ) and, if in
                                     excess of such amount, in a $25 integral
                                     multiple in excess thereof (with respect to
                                     the Class A Units issued). The principal
                                     amount of Securities deposited must be in
                                     the same ratio to the Unit Principal
                                     Balance (and Notional Amount with respect
                                     to the Class B Units) of the Units received
                                     for such deposit as the ratio of the
                                     aggregate principal amount of the
                                     Securities deposited on the Closing Date to
                                     the aggregate Unit Principal Balance (and
                                     aggregate Notional Amount with respect to
                                     the Class B Units) on the Closing Date. The
                                     Depositor must either arrange for the Swap
                                     Counterparty and the Trust to increase
                                     proportionally the notional amount under
                                     the Swap Agreement or arrange for an
                                     additional Swap Agreement to be entered
                                     into between the Trust and an additional
                                     Swap Counterparty. The Depositor must also
                                     arrange the issuance of Class B Units with
                                     a Notional Amount equal to the Unit
                                     Principal Balance being issued in
                                     connection with an additional issuance. Any
                                     accrued interest will be reflected in the
                                     price of the Securities and the Units. The
                                     Rating Agency Condition must be satisfied
                                     in connection with any such additional
                                     issuance.

Selling Agent:                       Morgan Stanley & Co. Incorporated.
                                     Notwithstanding any provision of the
                                     Standard Terms to the contrary, any sale of
                                     the Securities shall be conducted by and
                                     through the Selling Agent and not the
                                     Trustee.

Rating Agency Condition:             The definition of Rating Agencies Condition
                                     in the Standard Terms shall not apply.

                                     "Rating Agency Condition": With respect to
                                     any specified action or determination,
                                     means receipt of (i) oral or written
                                     confirmation by Moody's (for so long as the
                                     Units are outstanding and rated by Moody's)
                                     and (ii) written confirmation by S&P (for
                                     so long as the Units are outstanding and
                                     rated by S&P), that such specified action
                                     or determination will not result in the
                                     reduction or withdrawal of their
                                     then-current ratings on the Units;
                                     provided, however, that if the Rating
                                     Agency Condition specified herein is to be
                                     satisfied only with respect to Moody's or
                                     S&P, only clause (i) or clause (ii) shall
                                     be applicable. Such satisfaction may relate
                                     either to a specified transaction or may be
                                     a confirmation with respect to any future
                                     transactions which comply with generally
                                     applicable conditions published by the
                                     applicable rating agency.

Eligible Account:                    The definition of "Eligible Account" in the
                                     Standard Terms shall not apply.

                                     "Eligible Account": A non-interest bearing
                                     account, held in the United States, in the
                                     name of the Trustee for the benefit of the
                                     Trust that is either (i) a segregated
                                     account or segregated accounts maintained
                                     with a Federal or State chartered
                                     depository institution or trust company the
                                     short-term and long-term unsecured debt
                                     obligations of which (or, in the case of a
                                     depository institution or trust company
                                     that is the principal subsidiary of a
                                     holding company, the short-term and
                                     long-term unsecured debt obligations of
                                     such holding company) are rated P-1 and Aa2
                                     by Moody's, A-1+ and AA by S&P, and, if
                                     rated by Fitch, F1 and AA by Fitch at the
                                     time any amounts are held on deposit
                                     therein including when such amounts are
                                     initially deposited and all times
                                     subsequent or (ii) a segregated trust
                                     account or segregated accounts maintained
                                     as a segregated account or as segregated
                                     accounts and held by the Trustee in its
                                     Corporate Trust Office in trust for the
                                     benefit of the Unitholders.

Permitted Investments:               The following shall be a Permitted
                                     Investment in addition to the investments
                                     specified in the Standard Terms:

                                     Units of the Dreyfus Cash Management Fund
                                     Investor Shares or any other money market
                                     funds which are rated in the highest
                                     applicable rating category by each Rating
                                     Agency (or such lower rating if the Rating
                                     Agency Condition is satisfied).

Amendment of Trust Agreement:        Section 12.01(a) of the Standard Terms
                                     shall be replaced with the following:

                                     (a) The Trust Agreement may be amended from
                                     time to time by the Depositor and the
                                     Trustee without the consent of any of the
                                     Unitholders, upon delivery by the Depositor
                                     of an Opinion of Counsel acceptable to the
                                     Trustee to the effect that such amendment
                                     will not materially and adversely affect
                                     the interests of any holder of a Class of
                                     Units that is not voting with respect to
                                     such amendment pursuant to Section
                                     12.01(b), for any of the following
                                     purposes: (i) to cure any ambiguity or
                                     defect or to correct or supplement any
                                     provision in the Trust Agreement which may
                                     be defective or inconsistent with any other
                                     provision in the Trust Agreement; (ii) to
                                     provide for any other terms or modify any
                                     other terms with respect to matters or
                                     questions arising under the Trust
                                     Agreement; (iii) to amend the definitions
                                     of Trigger Amount and Maximum Reimbursable
                                     Amount so as to increase, but not decrease,
                                     the respective amounts contained in such
                                     definitions or to otherwise amend or waive
                                     the terms of Section 10.05(b) in any manner
                                     which shall not adversely affect the
                                     Unitholders in any material respect; (iv)
                                     to amend or correct or to cure any defect
                                     with respect to the Trustee Fee or Expense
                                     Administrator's fee; (v) to evidence and
                                     provide for the acceptance of appointment
                                     under the Trust Agreement by a successor
                                     Trustee; or (vi) to add or change any of
                                     the terms of the Trust Agreement as shall
                                     be necessary to provide for or facilitate
                                     the administration of the Trust, including
                                     any amendment necessary to ensure the
                                     classification of the Trust as a grantor
                                     trust for United States federal income tax
                                     purposes; provided, however, that in the
                                     case of any amendment pursuant to any of
                                     clauses (i) through (vi) above, the Rating
                                     Agency Condition shall be satisfied with
                                     respect to such amendment. If more than one
                                     Class of Units has been issued under the
                                     Trust Agreement, the provisions of this
                                     Section 12.01(a) shall apply to each Class
                                     of Units that is not materially and
                                     adversely affected by such amendment.

                                     Section 12.01(c) shall be re-designated
                                     Section 12.01(d).

                                     Section 12.01(b) shall be re-designated
                                     Section 12.01(c).

                                     The following shall constitute Section
                                     12.01(b):

                                     (b) The Trust Agreement may be amended from
                                     time to time by the Depositor and the
                                     Trustee with the consent of a 100% of the
                                     outstanding Unit Principal Balance of each
                                     Class of Units materially and adversely
                                     affected thereby. The Rating Agency
                                     Condition shall be satisfied with respect
                                     to such amendment unless Units representing
                                     100% of the Unit Principal Balance of all
                                     affected Units vote in favor of such
                                     amendment with notice that the Rating
                                     Agency Condition will not be satisfied.

                                     The following shall constitute Section
                                     12.01(e):

                                     (e) For purposes of this Section 12.01,
                                     Schedule III to any Trust Agreement and any
                                     Swap Agreements entered into in connection
                                     with any related Trust shall not be
                                     considered part of the Trust Agreement.
                                     Section 7.02 shall govern action taken
                                     under the Trust Agreement with respect to
                                     any amendments to such Swap Agreements.

Other Terms:                         The Trust shall not merge or consolidate
                                     with any other trust, entity or person and
                                     the Trust shall not acquire the assets of,
                                     or an interest in, any other trust, entity
                                     or person except as specifically
                                     contemplated herein.

                                     The Trustee shall provide to the
                                     Unitholders copies of any notices it
                                     receives with respect to a redemption of
                                     the Securities or an exercise of the call
                                     rights under the Swap Agreement and any
                                     other notices with respect to the
                                     Securities. Any such notice with respect to
                                     an exercise of call rights or redemption by
                                     the Security Issuer shall be sent at least
                                     20 calendar days prior to the exercise date
                                     or redemption date, as applicable.

                                     The reference to "B2" in the definition of
                                     Certificate in the Standard Terms shall be
                                     replaced with "Exhibit B2".

                                     The reference to "Section 10.02(ix)" in the
                                     definition of Available Funds in the
                                     Standard Terms shall be replaced with
                                     "Section 10.02(a)(ix)".

                                     The reference to "Section 3.04" in the
                                     definition of Unit Account in the Standard
                                     Terms shall be replaced with "Section
                                     3.05".

                                     The transfer by the Depositor to the
                                     Trustee specified in Section 2.01(a) of the
                                     Standard Terms shall be in trust.

                                     Section 2.06 of the Standard Terms shall be
                                     incorporated herein by inserting "cash in
                                     an amount equal to the premium under the
                                     Swap Agreement and" after the phrase
                                     "constituting the Trust Property," therein.

                                     The reference to "calendar day" in the last
                                     sentence of Section 3.06 of the Standard
                                     Terms shall be replaced with "Business
                                     Day".

                                     Section 4.02(d) of the Standard Terms shall
                                     be incorporated herein by striking "and the
                                     Trustee on behalf of the Unitholders" from
                                     the first sentence of the second paragraph
                                     thereof.

                                     Section 5.03(c) of the Standard Terms shall
                                     be incorporated herein by striking "(if so
                                     required by the Trustee or the Unit
                                     Registrar)" from the first sentence
                                     thereof.

                                     Section 7.01(c)(i) of the Standard Terms
                                     shall be incorporated herein by replacing
                                     the first word thereof ("after") with
                                     "alter".

                                     Section 7.01(c) of the Standard Terms shall
                                     be incorporated herein by inserting "(i)"
                                     between "Securities" and "would" in the
                                     clause that begins "and provided, further,"
                                     and adding at the end of the same sentence
                                     "and (ii) will not alter the classification
                                     of the Trust for Federal income tax
                                     purposes."

                                     Section 7.02 of the Standard Terms shall be
                                     incorporated herein by striking "(i) the
                                     Trustee determines that such amendment will
                                     not adversely affect the interests of the
                                     Unitholders and (ii)" from the first
                                     sentence thereof, inserting "on which it
                                     may conclusively rely" after "Opinion of
                                     Counsel" in such sentence, and striking
                                     "clause (ii)" from the second sentence of
                                     such Section.

                                     For the avoidance of doubt, Section 9.03(c)
                                     of the Standard Terms shall not be
                                     incorporated herein.

                                     Section 9.03(i) of the Standard Terms shall
                                     be incorporated herein by striking "or
                                     oral" after the phrase "at any time by" in
                                     the third sentence thereof.

                                     Clause (ix) of Section 10.02(a) shall not
                                     apply.

                                     Section 10.02(a)(x) of the Standard Terms
                                     shall be replaced with the following:

                                     (x) the Trustee shall have the power to
                                     sell the Securities and other Trust
                                     Property, in accordance with Article IX and
                                     XI, through the Selling Agent or, if the
                                     Selling Agent shall have resigned or
                                     declined to sell some or all of the
                                     Securities, any broker selected by the
                                     Trustee (at the direction of the Depositor)
                                     with reasonable care, in an amount
                                     sufficient to pay any amount due to the
                                     Swap Counterparty under the Swap Agreement
                                     (including Termination Payments) or
                                     reimbursable to itself in respect of unpaid
                                     Extraordinary Trust Expenses and to use the
                                     proceeds thereof to make such payments
                                     after the distribution of funds or Trust
                                     Property to Unitholders. Any such broker
                                     shall be instructed by the Trustee to sell
                                     such Trust Property in a reasonable manner
                                     designed to maximize the sale proceeds.

                                     Section 10.05(b) of the Standard Terms
                                     shall be incorporated herein by replacing
                                     ", pursuant to the first sentence of this
                                     paragraph" with "the Trustee shall be
                                     indemnified by the Trust, however," in the
                                     last sentence thereof.

                                     Section 10.06(a) of the Standard Terms
                                     shall be incorporated herein by inserting
                                     "or association" after the word
                                     "corporation" in the second sentence
                                     thereof. Section 10.07(a) of the Standard
                                     Terms shall be incorporated herein by
                                     replacing "notice or resignation" with
                                     "notice of resignation" in the second
                                     sentence thereof and striking the last two
                                     sentences thereof.

                                     Section 10.10(b) of the Standard Terms
                                     shall be incorporated herein by inserting
                                     "The Trustee shall not be liable for the
                                     acts or omissions of any co-trustee." after
                                     the last sentence thereof.

                                     Section 10.14 of the Standard Terms shall
                                     be replaced with the following:

                                     SECTION 10.14. Non-Petition. Prior to the
                                     date that is one year and one day after all
                                     distributions in respect of the Units have
                                     been made, none of the Trustee, the Trust
                                     or the Depositor shall take any action,
                                     institute any proceeding, join in any
                                     action or proceeding or otherwise cause any
                                     action or proceeding against any of the
                                     others under the United States Bankruptcy
                                     Code or any other liquidation, insolvency,
                                     bankruptcy, moratorium, reorganization or
                                     similar law ("Insolvency Law") applicable
                                     to any of them, now or hereafter in effect,
                                     or which would be reasonably likely to
                                     cause any of the others to be subject to,
                                     or seek the protection of, any such
                                     Insolvency Law.

                                     Section 12.01(a) of the Standard Terms
                                     shall be incorporated herein by replacing
                                     "(v)" with "(vi)" in the last proviso
                                     thereof.

                                     Section 12.01(c) of the Standard Terms
                                     shall be incorporated herein by inserting
                                     ", provided at the expense of the party
                                     requesting such amendment," after "Opinion
                                     of Counsel".

                                     Section 12.05 of the Standard Terms shall
                                     be incorporated herein by striking "the
                                     Trustee and" in the last sentence of the
                                     second paragraph thereof.

                                     The reference to "its President, its
                                     Treasurer, or one of its Vice Presidents,
                                     Assistant Vice Presidents or Trust
                                     Officers" in the first sentence of Section
                                     5.02(a) of the Standard Terms shall be
                                     replaced with "a Responsible Officer".

                                     The reference to "the proper officers" in
                                     the second sentence of Section 5.02(a) of
                                     the Standard Terms shall be replaced with
                                     "a Responsible Officer".

                                     The reference to "one of its authorized
                                     signatories" in the first sentence of
                                     Section 5.02(d) of the Standard Terms shall
                                     be replaced with "a Responsible Officer".

                                     The reference to the "Trust" in the first
                                     sentence of Section 5.08(b) of the Standard
                                     Terms shall be replaced with the "Trustee".

                                     References to D&P in the Standard Terms
                                     shall be incorporated as references to
                                     Fitch Inc. ("Fitch").

<PAGE>
                                   Schedule II
                            (Terms of Trust Property)

Securities:                          DPL Capital Trust II 8.125% trust preferred
                                     capital securities due September 1, 2031

Security Issuer:                     DPL Capital Trust II

Security Guarantor:                  DPL Inc.

                                     The Security Guarantor will be considered
                                     the "Security Issuer" for purposes of
                                     determining whether the Security Issuer is
                                     an Eligible Issuer and whether the
                                     Securities are Disqualified Securities.

Guarantor Debentures:                The Security Guarantor's 8.125% junior
                                     subordinated debentures due September 1,
                                     2031. Such debentures are the only assets
                                     of the Security Issuer.

                                     In the event that the Guarantor Debentures
                                     are exchanged for the Securities or
                                     distributed in liquidation of the Security
                                     Issuer, the Guarantor Debentures shall be
                                     treated as the Securities for all purposes
                                     and the Security Guarantor shall be treated
                                     as the Security Issuer for all purposes.
                                     Such exchange or liquidation shall not be
                                     considered a redemption.

Principal Amount:                    $25,000,000

Security Rate:                       8.125%

Credit Ratings:                      Baa2 by Moody's

                                     BBB- by S&P

Listing:                             Not applicable

Security Agreement:                  As to the Securities, the Amended and
                                     Restated Trust Agreement, dated as of
                                     August 31, 2001, among the Security
                                     Guarantor as depositor, The Bank of New
                                     York, as property trustee (referred to
                                     herein as the property trustee and also as
                                     the "Security Trustee"), The Bank of New
                                     York (Delaware) as Delaware trustee, and
                                     two individual administrative trustees who
                                     are employees or officers affiliated with
                                     the Security Guarantor, as amended and
                                     supplemented from time to time. As to the
                                     Guarantor Debentures, the indenture dated
                                     as of August 31, 2001, between the Security
                                     Guarantor and The Bank of New York, as
                                     trustee, as supplemented by the First
                                     Supplemental Indenture dated August 31,
                                     2001, and as may be further supplemented or
                                     amended from time to time.

Form:                                Global

Currency of
Denomination:                        United States dollars

Acquisition Price by Trust:          $24,738,000

Security Payment Date:               Each March 1 and September 1

Original Issue Date:                 On or about August 31, 2001

                                     The Security Issuer offered to exchange the
                                     securities then issued for publicly
                                     registered securities and such offering
                                     closed on or about February 4, 2002.

Maturity Date:                       September 1, 2031

Sinking Fund Terms:                  Not Applicable

Redemption Terms:                    The Guarantor Debentures and the Securities
                                     may be redeemed at any time with the
                                     payment of a make-whole amount with at
                                     least 30 days notice and within 90 days of
                                     the occurrence of a "special event" with
                                     the payment of a "special event redemption
                                     make-whole amount" (as more fully described
                                     in the underlying indenture and trust
                                     agreement). The Guarantor Debentures may
                                     also be distributed in exchange for the
                                     Securities or in liquidation of the Issuer.
                                     In such event the Guarantor Debentures
                                     would become the Securities under the Trust
                                     Agreement.

CUSIP No.:/ISIN No.                  23330AAC4

Security Trustee:                    The Bank of New York

Guarantor Debenture Trustee:         The Bank of New York

Available Information
Regarding the Security Issuer
(if other than U.S.
Treasury obligations):               The Security Guarantor is subject to the
                                     informational requirements of the
                                     Securities Exchange Act of 1934, as
                                     amended, and in accordance therewith files
                                     reports and other information with the
                                     Securities and Exchange Commission (the
                                     "Commission"). Such reports and other
                                     information can be inspected and copied at
                                     the public reference facilities maintained
                                     by the Commission at 450 Fifth Street,
                                     N.W., Washington, D.C. 20549 and at the
                                     following Regional Offices of the
                                     Commission: Woolworth Building, 233
                                     Broadway, New York, New York 10279, and
                                     Northwest Atrium Center, 500 West Madison
                                     Street, Chicago, Illinois 60661. Copies of
                                     such materials can be obtained from the
                                     Public Reference Section of the Commission
                                     at 450 Fifth Street, N.W., Washington,
                                     District of Columbia 20549 at prescribed
                                     rates.
<PAGE>
                                  Schedule III
                              (Call Option Confirm)

<PAGE>

Date:  July 9, 2002

To:    SATURNS Trust No. 2002-7            From:     Morgan Stanley & Co.
                                                     International Limited

Attn:  Asset-Backed Securities Group       Contact:  Chris Boas
       SATURNS Trust No. 2002-7

Fax:   312-904-2084                        Fax:      212-761-0406

Tel:   312-904-9387                        Tel:      212-761-1395

Re: Bond Option Transaction. MS Reference Number SQ1GE

         The purpose of this letter agreement is to confirm the terms and
conditions of the Transaction entered into between you and Morgan Stanley & Co.
International Limited ("MSIL"), with Morgan Stanley & Co. Incorporated
("MS&Co."), as agent, on the Trade Date specified below (the "Transaction").
This letter agreement constitutes a "Confirmation" as referred to in the
Agreement below.

         The definitions and provisions contained in the 1997 ISDA Government
Bond Option Definitions as published by the International Swaps and Derivatives
Association, Inc. ("ISDA") are incorporated into this Confirmation and this
transaction shall be deemed a "Government Bond Option Transaction" for purposes
of such definitions. In the event of any inconsistency between those definitions
and this Confirmation, this Confirmation will govern.

         1. This Confirmation supplements, forms a part of, and is subject to,
the ISDA Master Agreement dated as of the date hereof, as amended and
supplemented from time to time (the "Agreement"), between you and us. All
provisions contained in the Agreement govern this Confirmation except as
expressly modified below.

         2. The terms of the particular Transaction to which this Confirmation
relates are as follows:

<TABLE>
I. General Terms

<S>                                  <C>
Trade Date:                          June 20, 2002

Option Style:                        American

Option Type:                         Call

Buyer:                               MSIL ("Party A")

Seller:                              SATURNS Trust No. 2002-7 ("Party B")

Bonds:                               The obligation identified as follows:
                                     Bond Issuer:               DPL Capital Trust II
                                     Issue:                     8.125% trust preferred capital
                                                                securities due 2031
                                     CUSIP:                     23330AAC4
                                     Coupon:                    8.125%
                                     Maturity Date:             September 1, 2031
                                     Face Amount Purchased:     USD $25,000,000

                                     If the junior subordinated debentures
                                     underlying the Bonds are distributed to
                                     Party B as described in the prospectus for
                                     the Bonds, such underlying junior
                                     subordinated debentures shall be deemed to
                                     be the Bonds.

Premium:                             USD $62,500

Premium Payment Date:                July 9, 2002

Number of Options:                   25,000

Option Entitlement:                  USD 1,000 of face amount of the Bonds per Option.

Strike Price:                        (i) For any Exercise Date prior to July 9,
                                     2007, the redemption price of the Bonds
                                     including any make-whole amount (expressed
                                     as a percentage) subject to a maximum of
                                     110% of the face amount of the Bonds but
                                     exclusive of accrued interest or (ii) for
                                     any Exercise Date on or after July 9, 2007,
                                     100% of the face amount of the Bonds
                                     exclusive of accrued interest.

Calculation Agent:                   Party A

II. Exercise Terms

Automatic Exercise:                  Inapplicable

Exercise Period:                     Any Business Day from, and including, 9:00
                                     a.m. (New York time) on July 9, 2007, to,
                                     and including, the Expiration Time on the
                                     Expiration Date; provided, however, the
                                     Exercise Period shall also include any
                                     Business Day prior to July 9, 2007, if
                                     notice of redemption has been delivered by
                                     the Bond Issuer.

Exercise Date:                       For each Option exercised, the day during
                                     the Exercise Period on which that Option is
                                     exercised.

Rescission of Exercise (Cash         If Party B cannot  obtain a bid for the
Settlement Only):                    Bonds held by it in excess of the Strike
                                     Price together with accrued interest on the
                                     Bonds, then Party A's notice of exercise
                                     shall be rescinded and the Options for
                                     which notice of exercise was given shall
                                     continue in full force and effect without
                                     regard to such provision of notice.

Multiple Exercise:                   Applicable

Minimum Number of Options:           1

Written Confirmation of Exercise:    Applicable. Buyer shall give irrevocable
                                     exercise notice which may be given orally
                                     (including by telephone) during the
                                     Exercise Period but no later than the
                                     Notification Date. Buyer will execute and
                                     deliver a written exercise notice
                                     confirming the substance of such oral
                                     notice, however, failure to provide such
                                     written notice will not affect the validity
                                     of the oral notice.

Limitation on Rights of MSIL:        Buyer may, by written notice thereof to
                                     Seller, delegate its rights to provide a
                                     notice of exercise hereunder to a third
                                     party (the "Third Party"). Any such
                                     delegation will be irrevocable by Buyer
                                     without the written consent of the Third
                                     Party. Any such Third Party will have the
                                     same rights and obligations regarding
                                     providing notice of exercise hereunder as
                                     the Buyer had prior to such delegation.
                                     While any such delegation is effective,
                                     Seller will only recognize a notice of
                                     exercise that is provided by the Third
                                     Party.

Notification Date:                   (i) Any date at least 25 calendar days but
                                     not more than 60 calendar days prior to the
                                     Exercise Date, (ii) any date that is at
                                     least 10 calendar days prior to the
                                     Exercise Date if the Bond Issuer has
                                     provided notice of redemption or (iii) any
                                     date that is on or prior to the Exercise
                                     Date if the Bond Issuer provides less than
                                     15 calendar days' notice of its intention
                                     to redeem the Bonds.

Limited Right to Confirm Exercise:   Inapplicable

Expiration Date:                     September 1, 2028

Expiration Time:                     4:00 p.m. New York time

Business Days:                       New York and Chicago

III. Settlements:

Settlement:                          Cash Settlement if MSIL is Party A;
                                     otherwise Physical Settlement. Party A will
                                     notify Party B separately regarding the
                                     clearance system details for Physical
                                     Settlement.

Spot Price (Cash Settlement Only):   The cash proceeds received by Party B in
                                     connection with sale of the Bonds by Party
                                     B, excluding any amounts in respect of
                                     accrued interest. In the event of a
                                     redemption by the Bond Issuer, the
                                     redemption price paid by the Bond Issuer,
                                     excluding accrued interest.

Deposit of Bond Payment (Physical    Party A must  deposit the Bond Payment with
Settlement Only):                    the Trustee on the Business Day prior to
                                     the Exercise Date. The Bonds are to be
                                     delivered "free" to Party A.

Additional Payment Obligation of     To the Expense  Administrator (the "Expense
Party A:                             Administrator Payment Obligation"):

                                     If the Bond Issuer has not given notice of
                                     redemption in connection with the exercise
                                     of Options hereunder and if any such
                                     exercise is an exercise of less than all
                                     Options remaining unexercised hereunder,
                                     Party A shall pay to the Expense
                                     Administrator an amount equal to the
                                     present value of a stream of payments equal
                                     to $6,575 payable on each payment date for
                                     the Bonds until the maturity of the Bonds
                                     discounted at a rate of 6.0% per annum on
                                     the basis of a 360 day year consisting of
                                     twelve 30 day months from the date of such
                                     exercise until the Scheduled Final
                                     Distribution Date (as defined in the Trust
                                     Agreement), assuming for this purpose that
                                     the Trust (as defined in the Trust
                                     Agreement) is not terminated prior to the
                                     Scheduled Final Distribution Date,
                                     multiplied by the Option Entitlement
                                     multiplied by the number of Options
                                     exercised and divided by $25,000,000.

                                     To Party B for Payment on the Class B Units
                                     (the "Class B Unit Payment Obligation")

                                     Upon any exercise hereunder or upon any
                                     redemption of Bonds held by Party B by the
                                     Bond Issuer, Party A shall pay to Party B,
                                     for payment to the registered holder of the
                                     Class B Units, the present value of the
                                     Class B Unit Interest, calculated as the
                                     sum of (i) the amount of outstanding
                                     accrued interest in respect of the Class B
                                     Unit Corresponding Portion and (ii) the
                                     present value of the remaining scheduled
                                     payments (other than any accrued interest)
                                     in respect of the Class B Unit
                                     Corresponding Portion discounted at a rate
                                     of 8.125% per annum on the basis of a 360
                                     day year consisting of twelve 30 day
                                     months.

Settlement Date:                     For Cash Settlement, as applicable, the
                                     Business Day of settlement of the sale of
                                     the Bonds by Party B or the Business Day of
                                     settlement of a redemption of Bonds by the
                                     Bond Issuer. For Physical Settlement, the
                                     Exercise Date.
</TABLE>

         3. Additional Definitions.

         "Class B Unit" means the Class B Unit issued under the Trust Agreement.

         "Class B Unit Corresponding Portion" means the portion of the Class B
Unit to be redeemed or corresponding notional amount reduction under the Trust
Agreement in connection with an exercise hereunder or a redemption by the Bond
Issuer.

          "Class B Unit Interest" means at any time and from time to time, the
interest on the Class B Unit Corresponding Portion that would have accrued at
the rate and in the manner specified in the Trust Agreement and would have been
payable at the times specified in the Trust Agreement had (i) the rights to
purchase the Bonds hereunder not been exercised and (ii) had no redemption by
the Bond Issuer occurred. For the avoidance of doubt, Class B Unit Interest
shall not include amounts actually paid on the Class B Units in connection with
the exercise of the right to purchase the Bonds hereunder or a redemption by the
Bond Issuer and the Class B Unit Interest shall not be construed to entitle the
Class B Unit to any "double" payment of interest.

         "Trust Agreement" means the trust agreement dated as of the date hereof
between the MSDW Structured Asset Corp. and LaSalle Bank National Association.

         4. Representations. Morgan Stanley & Co. Incorporated is acting as
agent for both parties but does not guarantee the performance of Party A.

         5. Additional Termination Event. As set forth in the Agreement, a Trust
Wind-Up Event will result in an Additional Termination Event under the Agreement
with respect to which Party B shall be the Affected Party and this Transaction
shall be an Affected Transaction.

         6. Swap Termination Payments. In the event an Early Termination Date is
designated with respect to which this Transaction is an Affected Transaction,
there shall be payable to Party A as a termination payment in lieu of the
termination payment determined in accordance with Section 6(e) of the Agreement
an amount equal to the excess (if any) of the sale proceeds (or redemption
proceeds), excluding accrued interest, of the Bonds in excess of the Strike
Price.

         7. Assignment. The rights under this Confirmation and the Agreement may
be assigned at any time and from time to time in whole or in part; provided that
the Rating Agency Condition (as defined in the Trust Agreement) is satisfied
with respect to such assignment and any transfer. The transferee in any such
assignment or transfer must be a qualified institutional buyer as defined in
Rule 144A under the Securities Act of 1933.

         8.       Account Details.

Payments to Party A:                 Citibank, N.A., New York
                                     SWIFT BIC Code: CITIUS33
                                     ABA No.  021 000 089
                                     FAO: Morgan Stanley & Co. International
                                     Limited
                                     Account No. 3042-1519

Operations Contact:                  Barbara Kent
                                     Tel  212-537-1449
                                     Fax  212-537-1868

Payments to Party B:                 LaSalle Bank, Chicago, Illinois
                                     ABA No. 071 000 505
                                     Reference:  SATURNS 2002-7
                                     Unit Account / AC-2090067/
                                     Account No.: 67-9033-902

Operations Contact:                  Andy Streepey
                                     Tel: 312-904-9387
                                     Fax: 312-904-2084

<PAGE>

         Please confirm that the foregoing correctly sets forth the terms of our
agreement MS Reference Number SQ1GE by executing this Confirmation and returning
it to us.

Best Regards,

MORGAN STANLEY & CO. INTERNATIONAL LIMITED

BY: /s/ Chris Boas
    --------------------------------
    Name:  Chris Boas
    Title: Attorney in fact

Acknowledged and agreed as of the date first written above:

SATURNS TRUST NO. 2002-7
BY:  LaSalle Bank National Association,
      solely as Trustee and not in its individual capacity.

BY: /s/ Brian D. Ames
    --------------------------------
    Name:  Brian D. Ames
    Title: Vice President

MORGAN STANLEY & CO. INCORPORATED hereby agrees to and
acknowledges its role as agent for both parties in
accordance with the Schedule to the Agreement.

BY: /s/ John Kehoe
    --------------------------------
    Name:  John Kehoe
    Title: Attorney in fact

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