Document:

Exhibit 10.1

 

OCCIDENTAL PETROLEUM CORPORATION
2005 LONG-TERM INCENTIVE PLAN

(AS AMENDED THROUGH OCTOBER 13,
2010)

 

1.      PURPOSE

 

The
purposes of this Plan are (i) to furnish a significant incentive to the
employees and non-employee Directors of the Company and its subsidiaries by
making available to them the benefits of increased ownership of Shares (ii) to
promote the alignment of the interests of employees and non-employee Directors
on the one hand and stockholders on the other hand and (iii) to assist in the
recruitment and retention of employees and non-employee Directors.

 

2.      DEFINITIONS

 

“Board”
means the Board of Directors of the Company.

 

“Business
Combination” means a merger, consolidation, or other
reorganization, with or into, or the sale of all or substantially all of the
Company’s business and/or assets as an entirety to, one or more entities that
are not subsidiaries or other affiliates of the Company.

 

“Change
in Control” means the occurrence of any of the following
events:

 

(a)     Approval by the stockholders of the Company
of the dissolution or liquidation of the Company, other than in the context of
a transaction that does not constitute a Change in Control under clause (b)
below;

 

(b)     Consummation of a Business Combination, unless
(1) as a result of the Business Combination, more than 50 percent of the
outstanding voting power of the Successor Entity immediately after the
reorganization is, or will be, owned, directly or indirectly, by persons who
were holders of the Company’s voting securities immediately before the Business
Combination; (2) no “person” (as
such term is used in Sections 13(d) and 14(d) of the Exchange Act),
excluding the Successor Entity or an Excluded Person, beneficially owns,
directly or indirectly, more than 20 percent of the outstanding shares or the
combined voting power of the outstanding voting securities of the Successor
Entity, after giving effect to the Business Combination, except to the extent
that such ownership existed prior to the Business Combination; and (3) at least
50 percent of the members of the board of directors of the entity resulting
from the Business Combination were Directors at the time of the execution of
the initial agreement or of the action of the Board approving the Business
Combination;

 

(c)     Any “person” (as such term is used in Sections 13(d) and 14(d) of the
Exchange Act, but excluding any Excluded Person) is or becomes the beneficial
owner (as defined in Rule 13d-3 under the Exchange Act), directly or
indirectly, of securities of the Company representing 20 percent or more of the
combined voting power of the Company’s then outstanding voting securities,
other than as a result of (1) an acquisition directly from the Company; (2) an
acquisition by the Company; or (3) an acquisition by any employee benefit plan
(or related trust) sponsored or maintained by the Company or a Successor
Entity; or

 

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

 

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

 

“Committee”
means the Executive Compensation and Human Resources Committee of the
Board or its successor, which shall be composed of not less than two members of
the Board, each of whom shall be a “non-employee director” within the meaning
of Rule 16b-3 and an “outside director” within the meaning of Section 162(m).

 

“Company”
means Occidental Petroleum Corporation, a Delaware corporation.

 

“Director”
means a member of the Board.

 

“Disability” means
permanent and total disability as defined in Section 22(e)(3) of the Code.

 

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“Effective
Date” means May 6, 2005, or such later date as this Plan is approved by the
stockholders of the Company.

 

“Eligible
Person” means any person who is an officer or employee of
the Company or any of its subsidiaries and any person who is a non-employee
Director; provided, however that a non-employee Director shall not be an
Eligible Person for purposes of awarding of ISOs.

 

“Exchange
Act” means the Securities Exchange Act of 1934, as amended from time to
time.

 

“Excluded
Person” means any employee benefit plan of the Company and
any trustee or other fiduciary holding securities under a Company employee
benefit plan or any person described in and satisfying the conditions of Rule
13d-1(b)(i) of the Exchange Act.

 

“Fair
Market Value” means the last reported sale price of a share of
Common Share on the New York Stock Exchange — Composite Transactions on the
relevant date or, if there are no reported sales on such date, then the last
reported sales price on the next preceding day on which such a sale is
transacted.

 

“ISO” means an
incentive stock option qualified under Section 422 of the Code.

 

“Performance-Based
Award” means an award whose grant, vesting, exercisability or payment depends
upon on any one or more of the Performance Objectives, in each case relative to
Performance Goals, on an absolute or relative basis (including comparisons to
peer companies) or ratio with other Performance Objectives, either as reported
currency or constant currency, pre-tax or after-tax, before or after special
charges, for the Company on a consolidated basis or for one or more
subsidiaries, segments, divisions or business units, or any combination of the
foregoing.  The applicable performance
period may range from one to seven years.

 

“Performance
Goal” means a preestablished targeted level or levels of any one or more
Performance Objectives.

 

“Performance
Objectives” mean any one or more of the following business
criteria: A/R day sales outstanding, A/R to sales, debt, debt to debt plus
stockholder equity, debt to EBIT or EBITDA, EBIT, EBITDA, EPS, EVA, expense
reduction, interest coverage, inventory to sales, inventory turns, net income,
operating cash flow, pre-tax margin, return on assets, return on capital employed,
return on equity, sales, stock price appreciation, and total stockholder return
(TSR), each as defined further in Appendix A. 
These terms are used as applied under generally accepted accounting
principles (if applicable) and in the Company’s financial reporting.

 

“Plan” means this
Occidental Petroleum Corporation 2005 Long-Term Incentive Plan, as amended from
time to time.

 

“Qualifying
Options” mean options and stock appreciation rights granted
with an exercise price not less than Fair Market Value on the date of
grant.  Qualifying Options are
Performance-Based Awards.

 

“Rule
16b-3” means Rule 16b-3 under Section 16 of the Exchange Act.

 

“Section
162(m)” means Section 162(m) of the Code and the applicable
regulations and interpretations thereunder.

 

“Section
162(m) Award” means a Performance-Based Award intended to satisfy
the requirements for “performance-based compensation” within the meaning of
Section 162(m).

 

“Share
Limit” means the maximum number of Shares, as adjusted, that may be delivered
pursuant to all awards granted under this Plan.

 

“Shares”
mean the Company’s Common Stock, par value $0.20 per share.

 

“Successor
Entity” means the surviving or resulting entity or a parent
thereof of a Business Combination.

 

3.         SHARES SUBJECT TO THE
PLAN

 

3.1      AGGREGATE SHARE
LIMIT -  Subject to adjustment as
provided in or pursuant to this Section 3 or Section 7, a total of sixty-six
million (66,000,000) Shares shall be authorized for issuance pursuant to awards
granted under this Plan.  Any Shares
issued in connection with awards other than options and stock appreciation
rights shall be counted against the limit described above as three (3) Shares
for every one Share issued in connection with such award or by which the award
is valued by reference as three (3) Shares.

 

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3.2      INDIVIDUAL
LIMIT -  No individual shall be
granted options, stock appreciation rights or other awards in any 36-month
period covering more than eight million (8,000,000) Shares, and in the case of
ISOs granted to any individual who owns more than ten percent of the
outstanding stock of the Company within the meaning of Section 422 of the Code
the maximum term may not exceed five (5) years and the minimum exercise price
may not be less than 110 percent of Fair Market Value on the date of grant.

 

3.3      REISSUE OF
AWARDS AND SHARES -  Awards payable in cash or
payable in cash or Shares, including restricted shares, that are forfeited,
cancelled, or for any reason do not vest under this Plan, and Shares that are
subject to awards that expire or for any reason are terminated, cancelled or
fail to vest shall be available for subsequent awards under this Plan.  If an award under this Plan is or may be
settled only in cash, such award need not be counted against any of the share
limits under this Section 3, except as may be required to preserve the status
of an award as “performance-based compensation” under Section 162(m).  Shares subject to options or stock
appreciation rights that are exercised shall not be available for subsequent
awards.  The following transactions involving
Shares will not result in additional Shares becoming available for subsequent
awards under this Plan:  (i) Shares
tendered in payment of an option; (ii) Shares withheld for taxes; and (iii)
Shares repurchased by the Company using option proceeds.

 

4.         PLAN ADMINISTRATION

 

This
Plan shall be administered by the Committee.

 

4.1      POWERS OF THE COMMITTEE - Subject to the express
provisions of this Plan, the Committee shall be authorized and empowered to do
all things necessary or desirable in connection with the authorization of
awards and the administration of this Plan within its delegated authority,
including, without limitation, the authority to:

 

(a)     adopt, amend and rescind
rules, regulations and procedures relating to this Plan and its administration
or the awards granted under this Plan and determine the forms of awards;

 

(b)     determine who is an
Eligible Person and to which Eligible Persons, if any, awards will be granted
under this Plan;

 

(c)     grant awards to Eligible
Persons and determine the terms and conditions of such awards, including but
not limited to the number and value of Shares issuable pursuant thereto, the
times (subject to Section 5.5) at which and conditions upon which awards become
exercisable or vest or shall expire or terminate, and (subject to applicable
law) the consideration, if any, to be paid upon receipt, exercise or vesting of
awards;

 

(d)     determine the date of
grant of an award, which may be a designated date after but not before the date
of the Committee’s action;

 

(e)     determine whether, and the
extent to which, adjustments are required pursuant to Section 7 hereof;

 

(f)      interpret and construe
this Plan and the terms and conditions of any award granted hereunder, whether
before or after the date set forth in Section 5;

 

(g)     determine the
circumstances under which, consistent with the provisions of Section 8.2, any
outstanding award may be amended and make any amendments thereto that the
Committee determines are necessary or appropriate; and

 

(h)     acquire or settle rights
under options, stock appreciation rights or other awards in cash, stock of
equivalent value, or other consideration.

 

All
authority granted herein (except as provided in Section 6) shall remain in
effect so long as any award remains outstanding under this Plan.

 

4.2      SPECIFIC COMMITTEE RESPONSIBILITY AND DISCRETION REGARDING AWARDS -
Subject to the express provisions of this Plan, the Committee, in its
sole and absolute discretion, shall determine all of the terms and conditions
of each award granted under this Plan, which terms and conditions may include,
subject to such limitations as the Committee may from time to time impose,
among other things, provisions that:

 

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(a)     permit the recipient of
such award to pay the purchase price of the Shares or other property issuable
pursuant to such award, or any applicable tax withholding obligation upon such
issuance or in respect of such award or Shares, in whole or in part, by any one
or more of the following:

 

(i)    cash, cash equivalent, or
electronic funds transfer,

 

(ii)   the delivery of previously
owned shares of capital stock of the Company (including shares acquired as or
pursuant to awards) or other property,

 

(iii)  a reduction in the amount
of Shares or other property otherwise issuable pursuant to such award,

 

(iv)  a cashless exercise, or

 

(v)   any other legal
consideration the Committee deems appropriate;

 

(b)     qualify such award as an
ISO;

 

(c)     accelerate the receipt of
benefits pursuant to an award or adjust the exercisability, term (subject to
other limits) or vesting schedule of any or all outstanding awards, adjust the
number of Shares subject to any award, adjust the price of any or all
outstanding awards or otherwise change previously imposed terms and conditions,
pursuant to a termination of employment or an event referenced in Section 7 (in
which case the Committee’s discretion shall be exercised in a manner consistent
with Section 7) or in other circumstances or upon the occurrence of other
events as deemed appropriate by the Committee, by amendment of an outstanding
award, by substitution of an outstanding award, by waiver or by other legally
valid means (which may result, among other changes, in a greater or lesser
number of shares subject to the award, a shorter or longer vesting or exercise
period, or, except as provided below, an exercise or purchase price that is
higher or lower than the original or prior award), in each case subject to
Sections 3 and 8.2; provided, however, that in no case (other than an
adjustment contemplated by Section 7.2) shall the exercise price of any option or
stock appreciation right be reduced by an amendment to the award or a
cancellation and re-grant of the award to effect a repricing of the award to a
price below the Fair Market Value of the underlying Shares on the grant date of
the original option or stock appreciation right unless specific stockholder
consent is obtained;

 

(d)     authorize (subject to
Sections 7, 8, and 10) the conversion, succession or substitution of one or
more outstanding awards upon the occurrence of an event of the type described
in Section 7 or in other circumstances or upon the occurrence of other events
as deemed appropriate by the Committee; and

 

(e)     determine the value of and
acquire or otherwise settle awards upon termination of employment, upon such
terms as the Committee (subject to Sections 7, 8 and 10) deems
appropriate.

 

4.3      DELEGATION - Subject to Section 4.5, the Board may
delegate different levels of authority to different committees with
administrative and grant authority under this Plan, provided that each
designated committee granting any awards hereunder shall consist exclusively of
a member or members of the Board.  A
majority of the members of the acting committee shall constitute a quorum.  The vote of a majority of the members present
assuming the presence of a quorum or the unanimous written consent of the
Committee shall constitute action by the committee.  The Committee may delegate authority to grant
awards under this Plan for new employees to an officer of the Company who is
also a director and may delegate ministerial, non-discretionary functions to
individuals who are officers or employees of the Company or a subsidiary or to
third parties.

 

4.4      BIFURCATION -  Notwithstanding anything to
the contrary in this Plan, the provisions of this Plan may at any time be bifurcated
by the Board or the Committee in any manner so that provisions of any award
agreement (or this Plan) intended or required in order to satisfy the
applicable requirements of Rule 16b-3, Section 162(m) or other applicable law,
to the extent permitted thereby, are applicable only to persons subject to
those provisions and to those awards to those persons intended to satisfy the
requirements of the applicable legal restriction.

 

4.5      AWARDS TO NON-EMPLOYEE DIRECTORS - Notwithstanding any
provision in this Plan to the contrary and without being subject to management
discretion, the Board, acting through the non-employee Directors only, shall
have the authority, in its sole and absolute discretion, to select non-employee
Directors to receive awards other than ISOs under this Plan.  The Board, acting through the non-employee
Directors only shall set the terms of any such awards in its sole and absolute
discretion, and the Board, acting through the non-employee 

 

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Directors
only, shall be responsible for administering and construing such awards in
substantially the same manner that the Committee administers and construes
awards to other Eligible Persons.

 

5.         AWARDS

 

5.1      TYPE AND FORM OF AWARDS
- All awards shall be evidenced in writing (including
electronic form), substantially in the form approved by the Committee.  The types of awards that the Committee may
grant include, but are not limited to, any of the following, on an immediate or
deferred basis, either singly, or in tandem or in combination with or in
substitution for, other awards of the same or another type:  (i) Shares, (ii) options (ISOs or
nonqualified stock options), stock appreciation rights (including limited stock
appreciation rights), restricted stock (which shall vest over a period of not
less than three years), stock units, or similar rights to purchase or acquire
shares, whether at a fixed or variable price or ratio related to the Shares,
upon the passage of time, the occurrence of one or more events, or the
satisfaction of Performance Goals or other conditions, or any combination
thereof, (iii) any similar securities with a value derived from the value of or
related to the Shares or other securities of the Company and/or returns
thereon, or (iv) cash.  Share-based
awards may include (without limitation) stock options, stock purchase rights,
stock bonuses, stock units, stock appreciation rights, limited stock
appreciation rights, phantom stock, dividend equivalents (independently or in
tandem with any form of stock grant), dividend rights (independently or in
tandem with any form of stock grant), Shares, any of which may be payable in
Shares or cash, and may consist of one or more of such features in any
combination.

 

5.2      PERFORMANCE-BASED AWARDS
- Any of the types of awards listed in Section 5.1 may
be granted as Performance-Based Awards.

 

5.2.1           Section 162(m)
Awards. The Committee has discretion to determine if any
Performance-Based Award is intended to be a Section 162(m) Award.  The specific Performance Goals in respect of
Section 162(m) Awards, other than Qualifying Options, must be approved by the
Committee in advance of any applicable deadlines under Section 162(m) and while
the performance relating to those goals remains substantially uncertain within
the meaning thereof.  The persons
eligible for Section 162(m) Awards shall be executive officers of the Company
and its subsidiaries and, in the discretion of the Committee, other employees
of the Company or its subsidiaries who are designated by the Committee to
receive a Section 162(m) Award because they may be executive officers of the
Company or its subsidiaries by the time their awards are exercised, vested or
paid.  Except as otherwise permitted
under Section 162(m), before any Section 162(m) Award is paid, the Committee
must certify that the Performance Goal and any other material terms of the
Section 162(m) Award were in fact satisfied.

 

5.2.2           Reservation of
Discretion - The Committee shall have discretion to determine the
conditions, restrictions or other limitations, in accordance with the terms of
this Plan and, in the case of Section 162(m) Awards, the limitations of Section
162(m), on the payment of individual Performance-Based Awards under this
Section 5.2.

 

5.2.3           Adjustments - Performance Goals or other
features of an award under this Section 5.2 may be (i) adjusted to reflect a
change in corporate capitalization, a corporate transaction (such as a
reorganization, combination, separation, merger, acquisition, or any
combination of the foregoing) or a complete or partial corporate liquidation,
or (ii) calculated either without regard for or to reflect any change in
accounting policies or practices affecting the Company and/or the Performance
Objectives or Performance Goals, or (iii) adjusted for any other circumstances
or event, or (iv) any combination of (i) through (iii), but only to the extent
in each case that such adjustment or determination in respect of Section 162(m)
Awards would be consistent with the requirements of Section 162(m) to qualify
as performance-based compensation.

 

5.3      CONSIDERATION FOR SHARES
- Shares may be issued pursuant to an award for any lawful consideration
as determined by the Committee, including, without limitation, services
rendered by the recipient of such award, but shall not be issued for less than
the minimum lawful consideration.  Awards
may be payable in cash, stock or other consideration or any combination
thereof, as the Committee shall designate in or (except as required by Section
5.2) by amendment to the terms and conditions governing such award.

 

5.4      LIMITED RIGHTS - Except as
otherwise expressly authorized by the Committee or this Plan or in the
applicable award terms and conditions, a participant will not be entitled to
any privilege of stock ownership as to 

 

5

 

any
Shares not actually delivered to and held of record by the participant.  No adjustment will be made for dividends or
other rights as a stockholder for which a record date is prior to such date of
delivery.

 

5.5      OPTION/STOCK APPRECIATION
RIGHT PRICING AND TERM LIMITS - The purchase price per share
of the Shares covered by any option or the base price of any stock appreciation
right shall be determined by the Committee at the time of the grant, but shall
not be less than 100 percent of the Fair Market Value of the Shares on the date
of grant.  Any option, stock appreciation
right, warrant or similar right shall expire and any other award shall vest not
more than 10 years after the date of grant. 
An award may be converted or convertible, notwithstanding the foregoing
limits, into or payable in, Shares or another award that otherwise satisfies
the requirements of this Plan.

 

5.6      TRANSFER RESTRICTIONS
- Unless otherwise expressly provided in or permitted
by this Section 5.6, by applicable law or by the award terms and conditions (i)
all awards are nontransferable and shall not be subject in any manner to sale,
transfer, anticipation, alienation, assignment, pledge, encumbrance or charge;
(ii) awards shall be exercised only by the holder; and (iii) amounts payable or
shares issuable pursuant to an award shall be delivered only to (or for the
account of) the holder.

 

5.6.1           Exceptions by Committee Action - The Committee, in its
sole discretion, may permit an award to be transferred for estate and/or tax
planning purposes and on a basis consistent with the Company’s lawful issue of
securities and the incentive purposes of the award and this Plan.
Notwithstanding the foregoing, awards intended as ISOs or restricted stock
awards for purposes of the Code shall be subject to any and all additional
transfer restrictions necessary to preserve their status as ISOs or restricted
shares, as the case may be, under the Code.

 

5.6.2           Exclusions - The exercise and transfer restrictions in
this Section 5.6 shall not apply to:

 

(a)               transfers to the
Company,

 

(b)               the designation
of a beneficiary to receive benefits in the event of the participant’s death
or, if the participant has died, transfers to or exercise by the participant’s
beneficiary, or, in the absence of a validly designated beneficiary, transfers
by will or the laws of descent and distribution,

 

(c)               transfers
pursuant to a domestic relations order (if approved or ratified by the
Committee), if (in the case of ISOs) permitted by the Code,

 

(d)               if the
participant has suffered a Disability, permitted transfers to or exercises on
behalf of the holder by his or her legal representative, or

 

(e)               the
authorization by the Committee of “cashless exercise” procedures with third
parties who finance or who otherwise facilitate the exercise of awards
consistent with applicable laws and the express authorization of the Committee.

 

5.7      TAX WITHHOLDING - Upon any
exercise, vesting, or payment of any award, the Company shall:

 

(a)               require the recipient (or his or
her heirs, personal representatives or beneficiaries, as the case may be) to
pay or provide for payment of the amount of any taxes which the Company or any
subsidiary may be required to withhold with respect to such transaction; or

 

(b)               deduct from any amount payable in
cash the amount of any taxes that the Company or any subsidiary may be required
to withhold with respect to such cash amount.

 

5.8      POSSIBLE SHARE OFFSET
- In any case where a tax is required to be withheld
in connection with the delivery of Shares under this Plan, the Committee may
require or may permit the holder the right to offset, pursuant to such rules
and subject to such conditions as the Committee may establish, the number of
shares to be delivered by (or otherwise reacquire) the appropriate number of
shares valued at their then Fair Market Value, to satisfy the minimum statutory
withholding taxes with respect thereto.

 

5.9      CASH AWARDS - The Committee
shall have the express authority to pay awards in cash under this Plan, whether
in lieu of, in addition to or as part of another award.

 

5.10    TERMINATION
OF EMPLOYMENT OR SERVICE - If an Eligible Person’s
employment with or service to the Company or to any parent or subsidiary
terminates for any reason, his or her outstanding awards may 

 

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thereafter
be exercised (if at all) to the extent provided in the agreement evidencing
such award, or as otherwise determined by the Committee.

 

6.         TERM OF PLAN

 

No
award shall be granted under this Plan after the tenth anniversary of the
Effective Date of this Plan.  After that
date, this Plan shall continue in effect as to then outstanding awards.  Any then outstanding award may be amended
thereafter in any manner that would have been permitted earlier, except that no
such amendment shall increase the number of Shares subject to, comprising or
referenced in the award or reduce the exercise or base price of an option or
stock appreciation right or permit cash payments in an amount that exceeds the
limits of Section 3 (as adjusted pursuant to Section 7.2).

 

7.         ADJUSTMENTS; CHANGE IN
CONTROL

 

7.1      CHANGE IN CONTROL;
ACCELERATION AND TERMINATION OF AWARDS - Unless prior to a Change in
Control, the Committee determines that, upon its occurrence, benefits under any
or all awards will not accelerate or determines that only certain or limited
benefits under any or all awards will be accelerated and the extent to which
they will be accelerated, or establishes a different time in respect of such
Change in Control for such acceleration, then upon the occurrence of a Change
in Control:

 

	
  (a)

  	
   

  	
  each
  option and stock appreciation right shall become immediately exercisable,

  
	
   

  	
   

  	
   

  
	
  (b)

  	
   

  	
  restricted
  stock shall immediately vest free of restrictions,

  
	
   

  	
   

  	
   

  
	
  (c)

  	
   

  	
  each
  award under Section 5.2 shall become payable to the participant,

  
	
   

  	
   

  	
   

  
	
  (d)

  	
   

  	
  the
  number of Shares covered by each stock unit account shall be issued to the
  participant, and

  
	
   

  	
   

  	
   

  
	
  (e)

  	
   

  	
  any
  other rights of a participant under any other award will be accelerated to
  give the participant the benefit intended under any such award.

  

 

The
Committee may override the limitations on acceleration in this Section 7.1 by
express provision in the award agreement and may accord any Eligible Person a
right to refuse any acceleration, whether pursuant to the award agreement or
otherwise, in such circumstances as the Committee may approve. Any acceleration
of awards shall comply with applicable legal and regulatory requirements.
Without limiting the generality of the foregoing, the Committee may deem an
acceleration to occur immediately prior to or up to 30 days before the
applicable event and/or reinstate the original terms of an award if an event
giving rise to an acceleration does not occur.

 

If
any option or other right to acquire Shares under this Plan has been fully
accelerated as required or permitted by this Plan but is not exercised prior to
(i) a dissolution of the Company, or (ii) an event described in this Section
7.1 that the Company does not survive, or (iii) the consummation of an event
described in Section 7.2 involving a Change in Control approved by the Board,
such option or right will terminate, subject to any provision that has been
expressly made by the Committee or the Board through a plan of reorganization
approved by the Board or otherwise for the survival, substitution, assumption,
exchange or other settlement of such option or right.

 

7.2      ADJUSTMENTS
- The following provisions will apply if any
extraordinary dividend or other extraordinary distribution occurs in respect of
the Shares (whether in the form of cash, Shares, other securities, or other
property), or any reclassification, recapitalization, stock split (including a
stock split in the form of a stock dividend), reverse stock split,
reorganization, merger, combination, consolidation, split-up, spin-off,
repurchase, or exchange of Shares or other securities of the Company, or any similar,
unusual or extraordinary corporate transaction (or event in respect of the
Shares) or a sale of substantially all the assets of the Company as an entirety
occurs. The Committee will, in such manner and to such extent (if any) as it
deems appropriate and equitable:

 

(a)     proportionately adjust any
or all of (i) the number and type of Shares (or other securities) that
thereafter may be made the subject of awards (including the specific maxima and
numbers of shares set forth elsewhere in this Plan), (ii) the number, amount
and type of shares (or other securities or property) subject to any or all
outstanding awards, (iii) the grant, purchase, or exercise price of any or all
outstanding awards, (iv) the securities, cash or other property deliverable
upon exercise of any 

 

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outstanding awards, or (v) the Performance Goals or Performance
Objectives appropriate to any outstanding awards, or

 

(b)     in the case of an
extraordinary dividend or other distribution, recapitalization,
reclassification, merger, reorganization, consolidation, combination, sale of
assets, split-up, exchange, or spin-off, make provision for a cash payment or
for the substitution or exchange of any or all outstanding awards or the cash,
securities or property deliverable to the holder of any or all outstanding
awards based upon the distribution or consideration payable to holders of the
Shares of the Company upon or in respect of such event.

 

In
each case, with respect to awards of ISOs, no such adjustment will be made that
would cause this Plan to violate Section 422 or 424 of the Code or any
successor provisions without the written consent of holders materially
adversely affected thereby. In any of such events, the Committee may take such
action sufficiently prior to such event if necessary or deemed appropriate to
permit the participant to realize the benefits intended to be conveyed with
respect to the underlying shares in the same manner as is available to
stockholders generally.

 

8.         PLAN AMENDMENT AND
TERMINATION

 

8.1      AUTHORITY OF THE BOARD -
Subject to Sections 8.2 and 8.3 and New York Stock Exchange Rules
applicable to companies listed on such Exchange, the Board may amend or
terminate this Plan at any time and in any manner.

 

8.2      RESTRICTIONS - No amendment or
termination of this Plan or change in or affecting any outstanding award shall
deprive in any material respect the holder, without the consent of the holder,
of any of his or her rights or benefits under or with respect to the award.
Adjustments contemplated by Section 7 shall not be deemed to constitute a
change requiring such consent.

 

8.3      STOCKHOLDER APPROVAL
- Stockholder approval shall be required for any
amendment to this Plan that would:

 

(a)     materially increase the
benefits accruing to participants under this Plan,

 

(b)     materially increase the
number of securities which may be issued under this Plan, or

 

(c)     materially modify the
requirements as to eligibility for participation in this Plan.

 

9.         LEGAL MATTERS

 

9.1      COMPLIANCE AND CHOICE OF
LAW; SEVERABILITY - This Plan, the granting and
vesting of awards under this Plan and the issuance and delivery of Shares
and/or the payment of money under this Plan or under awards granted hereunder
are subject to compliance with all applicable federal and state laws, rules and
regulations and to such approvals by any listing, regulatory or governmental
authority as may, in the opinion of counsel for the Company, be necessary or
advisable in connection therewith.  This
Plan, the awards, all documents evidencing awards and all other related documents
shall be governed by, and construed in accordance with the laws of the state of
Delaware. If any provision shall be held by a court of competent jurisdiction
to be invalid and unenforceable, the remaining provisions of this Plan shall
continue in effect.

 

9.2      NON-EXCLUSIVITY OF PLAN
- Nothing in this Plan shall limit or be deemed to
limit the authority of the Board or the Committee to grant awards or authorize
any other compensation, with or without reference to the Shares, under any
other plan or authority.

 

9.3      NO EMPLOYMENT CONTRACT
- Nothing contained in this Plan (or in any other
documents relating to this Plan or to any award) shall confer upon any Eligible
Person or other participant any right to continue in the employ or other
service of the Company or any subsidiary or constitute any contract or
agreement of employment or other service, nor shall interfere in any way with
the right of the Company or any subsidiary to change such person’s compensation
or other benefits or to terminate the employment of such person, with or
without cause.

 

10.      MISCELLANEOUS

 

10.1    UNFUNDED PLAN - Unless
otherwise determined by the Committee, this Plan shall be unfunded and shall
not create (or be construed to create) a trust or a separate fund or funds.
This Plan shall not establish any 

 

8

 

fiduciary
relationship between the Company or any subsidiary and any participant or other
person. To the extent any person holds any rights by virtue of awards granted
under this Plan, such rights shall be no greater than the rights of an
unsecured general creditor of the Company.

 

10.2    AWARDS NOT COMPENSATION
- Unless otherwise determined by the Committee,
settlements of awards received by participants under this Plan shall not be deemed
a part of a participant’s regular, recurring compensation for purposes of
calculating payments or benefits from any Company benefit plan, severance
program or severance pay law of any country.

 

10.3    FRACTIONAL SHARES - The Company
shall not be required to issue any fractional Shares pursuant to this Plan. The
Committee may provide for the elimination of fractions or for the settlement
thereof in cash.

 

10.4    FOREIGN PARTICIPANTS
- No award shall be made to a participant who is a
foreign national or who is employed by the Company or any subsidiary outside
the United States of America if such award would violate applicable local law.
In order to facilitate the making of an award, the Committee may provide for
such special terms for awards to participants who are foreign nationals, or who
are employed by the Company or any subsidiary outside of the United States of
America, as the Committee may consider necessary or appropriate to accommodate
differences in local law, tax policy or custom. 
Moreover, the Committee may approve such supplements to or amendments to
this Plan as it may consider necessary or appropriate for such purposes unless
stockholder approval for any such change would be required in accordance with
the provisions of Section 8.

 

APPENDIX A TO 2005 LONG-TERM
INCENTIVE PLAN

 

PERFORMANCE OBJECTIVES

 

The
Performance Objectives shall have the meanings set forth below, in each case as
reported in the financial statements of the Company or applicable subsidiary,
division, segment, or unit (“financial statements”).

 

“A/R
Day Sales Outstanding” means trade accounts receivable (A/R)(net of
reserves) divided by latest historical day Sales.

 

“A/R to
Sales” means the ratio of accounts receivable to Sales.

 

“Debt” means all
accounts classified as such in the financial statements.

 

“Debt
to Debt plus stockholder equity” means the ratio of Debt to
Debt plus stockholder equity.

 

“Debt
to EBIT or EBITDA” means the ratio of Debt to EBIT or EBITDA.

 

“EBIT” means Net
Income before interest expense and taxes, which may be adjusted for special
charges, if any.

 

“EBITDA” means Net
Income before interest expense, taxes, depreciation and amortization, which may
be adjusted for special charges, if any.

 

“EPS” means Net
Income divided by the weighted average number of Shares outstanding. The Shares
outstanding may be adjusted to include the dilutive effect of stock options,
restricted stock and other dilutive financial instruments as required by
generally accepted accounting principles.

 

“EVA” means operating
profit after tax (OPAT) (which is defined as Net Income after tax but before
tax adjusted interest income and expense and goodwill amortization), less a
charge for the use of capital (average total capital as such term is used below
under “Return on Capital Employed”). Net Income may be adjusted for special
charges and acquisition activity costs, if any. The charge for capital is the
percentage cost of capital times the average total capital. The cost of capital
is the weighted average cost of capital as calculated for the Company.

 

“Expense
Reduction” means reduction in actual expense or an improvement
in the expense to Sales ratio compared to a target or prior year actual expense
to Sales ratio, which may be adjusted for special charges, if any.

 

9

 

“Interest
Coverage” means the ratio of EBIT or EBITDA to interest
expense. Net Income may be adjusted for special charges.

 

“Inventory
to Sales” means the ratio of total inventory to Sales.

 

“Inventory
Turns” means the ratio of total cost of goods sold on a historical basis to
average net inventory. This ratio may be adjusted for special charges, if any.

 

“Net
Income” means the difference between total Sales plus other revenues and net
total costs and expenses, including income taxes.

 

“Operating
Cash Flow” means the net cash provided by operating activities
less net cash used by operations and investing activities as shown on the
statement of cash flows. The numbers relating to the foregoing may be adjusted
for special charges, if any.

 

“Pre-Tax
Margin” means the ratio of earnings before income taxes to Sales. Earnings may
be adjusted for special charges, if any.

 

“Return
on Assets” means the ratio of Net Income to total average
assets including goodwill. Earnings may be adjusted for special charges and
goodwill amortization for comparative purposes.

 

“Return
on Capital Employed” means the ratio of Net Income plus tax-effected
interest expense to long-term Debt plus stockholder equity.

 

“Return
on Equity” means the ratio of Net Income to stockholder
equity.

 

“Sales”
means sales, service and rental income from third parties net of
discounts, returns and allowances.

 

“Stock
Price Appreciation” means an increase, or an average annualized
increase, in the stock price or market value of the Shares of the Company after
purchase of, or the date of grant of, an award or above a specified stock
price.

 

“Total
Stockholder Return or TSR” means the appreciation in
the price of a Common Share plus reinvested dividends over a specified period
of time.

 

10Exhibit
10.2

 

OCCIDENTAL
PETROLEUM CORPORATION

2005
LONG-TERM INCENTIVE PLAN

RESTRICTED
STOCK INCENTIVE AWARD TERMS AND CONDITIONS

 

	
  DATE
  OF GRANT:

  	
   

  	
  October 13,
  2010

  
	
   

  	
   

  	
   

  
	
  SHARES
  OF RESTRICTED STOCK:

  	
   

  	
  See
  Morgan Stanley Smith Barney Benefit Access “Other Awards/My Awards/Awarded”

  
	
   

  	
   

  	
   

  
	
  VESTING
  DATE:

  	
   

  	
  October 12,
  2013

  

 

The
following Terms and Conditions (these “Terms and
Conditions”) are set forth as of the Date of Grant between OCCIDENTAL PETROLEUM
CORPORATION, a Delaware corporation (“Occidental” and, with its subsidiaries,
the “Company”), and the Eligible Employee receiving this award (the “Grantee”).

 

1.             GRANT OF RESTRICTED STOCK INCENTIVE AWARD.  In accordance with these Terms and Conditions
and the Occidental Petroleum Corporation 2005 Long-Term Incentive Plan, as the
same may be amended from time to time (the “Plan”), Occidental grants to the
Grantee as of the Date of Grant, the number of shares of Restricted Stock set
forth above. The Restricted Stock shall be fully paid and nonassessable and
shall be represented by a book-entry account registered in the name of the
Grantee with Occidental’s registrar and stock transfer agent that will be
subject to the restrictions hereinafter set forth until those shares have
become transferable in accordance with Section 2.

 

2.             RESTRICTIONS ON TRANSFER.  (a) Until the Vesting Date and the
certification by the Committee of the attainment on or after September 30,
2013 of the Performance Goal, the shares of Restricted Stock may not be
transferred, assigned sold, pledged, exchanged, or otherwise encumbered or
disposed of by the Grantee, except to Occidental or pursuant to a domestic
relations order, if applicable, (if approved or ratified by the Committee);
provided that the Grantee may designate from time to time a beneficiary or
beneficiaries on a form approved by the Company (if enforceable under local
law).  If the Grantee dies without a
beneficiary designation on file with Occidental at the time of death, the
Grantee’s interest in the Restricted Stock will be transferred by will or by
the laws of descent and distribution.

 

(b) Further,
if the Grantee was a Named Executive Officer during the last completed fiscal
year prior to vesting, then such
Grantee shall retain Beneficial Ownership of Shares equal to not less than 50%
of the net after-tax Shares received under these Terms and Conditions until the
third anniversary date of the vesting of the Restricted Stock under this Award
(the “Beneficial Ownership Period”). Compliance with the foregoing requirement
shall be determined by reference to the reports filed by the Grantee on Forms
3, 4, and 5, as applicable, pursuant to Section 16(a) of the
Securities Exchange Act of 1934 (the “Exchange Act”) and the aggregate number
of Shares reported as Beneficially Owned during the Beneficial Ownership Period
shall be not less than the sum of the number of Shares then required to be so
owned pursuant to these Terms and Conditions and the terms and conditions of
any other grant containing this or 

 

1

 

a
similar requirement.  For purposes of
these Terms and Conditions, “Beneficial Ownership” has the meaning ascribed in Rule 16a-1(2) under
the Exchange Act, and “Named Executive Officer” has the meaning ascribed
thereto pursuant to Item 402 of Regulation S-K under the Exchange Act.

 

3.             PERFORMANCE GOAL.  In order for the Grantee to retain the Restricted Stock, the Company must
achieve cumulative reported Net Income (as defined in the Plan) of ten billion
dollars ($10,000,000,000), during the period beginning October 1, 2010 and
ending September 30, 2017.  Reported
Net Income shall be cumulative and shall be the sum of the net income and net
losses reported in Occidental’s Annual and Quarterly Reports filed with the
Securities and Exchange Commission.  The
Committee may certify attainment of the Performance Goal effective at any time
on or after the Vesting Date (the “Certification Date”).

 

4.             VESTING AND
FORFEITURE OF RESTRICTED STOCK INCENTIVE AWARD. 
(a) If the Grantee fails to accept this award prior to
the next record date for the payment of dividends on the Common Stock
subsequent to the Date of Grant, then, notwithstanding any other provision of
this award, the Grantee shall forfeit the shares of Restricted Stock and all
rights under this award and this award will become null and void.  For purposes of this section, acceptance of
the award shall occur on the date the Grantee accepts this Restricted Stock
Incentive Award through Morgan Stanley Smith Barney Benefit Access or any
replacement on-line system designated by the Company.

 

(b) The Grantee must remain in the continuous employ of the
Company through the Vesting Date.  The
continuous employment of the Grantee will not be deemed to have been
interrupted by reason of the transfer of the Grantee’s employment among the
Company and its affiliates or an approved leave of absence.  However, if, prior to the Vesting Date, the
Grantee dies, becomes permanently disabled while in the employ of the Company
and terminates employment as a result thereof, retires with the consent of the
Company, or terminates employment for the convenience of the Company (each of
the foregoing, a “Forfeiture Event”), then the number of shares of Restricted
Stock will be reduced on a pro rata basis based upon the number of days
remaining until the Vesting Date following the date of the Forfeiture
Event.  If the Grantee terminates
employment voluntarily or is terminated for cause before the Vesting Date, then
these Terms and Conditions will terminate automatically on the date of the
Grantee’s termination and the Grantee shall forfeit the Restricted Stock.

 

(c)           If a Change in
Control event occurs prior to the Vesting Date, the number of shares of
Restricted Stock will be reduced on a pro rata basis based upon the number of
days remaining until the Vesting Date following the date of the Change in
Control and become nonforfeitable unless, prior to the occurrence of the Change
in Control event, the Committee, as provided in Section 7.1 of the Plan,
determines that such event will not accelerate vesting of any of these
Restricted Stock.  Any such determination
by the Committee is binding on the Grantee.

 

2

 

(d)           If a Change in
Control event occurs on or after the Vesting Date but prior to the
Certification Date, the shares of Restricted Stock will become nonforfeitable
unless, prior to the occurrence of the Change in Control event, the Committee,
as provided in Section 7.1 of the Plan, determines that such event will
not accelerate vesting of any of these Restricted Stock.  Any such determination by the Committee is
binding on the Grantee.

 

(e) Notwithstanding Section 4(b), if the Company does not
meet the Performance Goal on or before September 30, 2017 the Grantee or
any permitted assignee will forfeit the Restricted Stock.  If the Company meets the Performance Goal on
or before September 30, 2017, the Restricted Stock (as may be adjusted
pursuant to Section 4(b)), will become nonforfeitable on the Certification
Date.

 

5.             DIVIDEND,
VOTING AND OTHER RIGHTS.  Except as otherwise provided herein, the
Grantee shall have all of the rights of a stockholder with respect to the
shares of Restricted Stock, including the right to vote such shares and receive
any dividends that may be paid thereon; provided, however, that any additional
shares of Common Stock or other securities that the Grantee may become entitled
to receive pursuant to a stock dividend, stock split, combination of shares,
recapitalization, merger, consolidation, separation or reorganization or any
other change in the capital structure of Occidental shall be subject to the
same restrictions as the shares of Restricted Stock.

 

6.             NO EMPLOYMENT
CONTRACT.  Nothing in these
Terms and Conditions confers upon the Grantee any right with respect to
continued employment by the Company, nor limits in any manner the right of the
Company to terminate the employment or adjust the compensation of the
Grantee.  Unless otherwise agreed in a
writing signed by the Grantee and an authorized representative of the Company,
the Grantee’s employment with the Company is at will and may be terminated at
any time by the Grantee or the Company.

 

7.             TAXES AND
WITHHOLDING.  Regardless of
any action the Company takes with respect to any or all income tax (including
U.S. federal, state and local tax and non-U.S. tax), social insurance, payroll
tax, payment on account or other tax-related items related to the Grantee’s
participation in the Plan and legally applicable to the Grantee (“Tax-Related
Items”), the Grantee acknowledges that the ultimate liability for all
Tax-Related Items is and remains the Grantee’s responsibility and may exceed
the amount actually withheld by the Company. 
The Grantee further acknowledges that the Company (i) makes no
representations or undertakings regarding the treatment of any Tax-Related
Items in connection with any aspect of this Restricted Stock Incentive Award,
including the grant or vesting of the Restricted Stock Incentive Award and the
receipt of dividends; and (ii) does not commit to and is under no
obligation to structure the terms of the grant or any aspect of the Restricted
Stock Incentive Award to reduce or eliminate the Grantee’s liability for
Tax-Related Items or achieve any particular tax result.  Further, if the Grantee has become subject to
tax in more than one jurisdiction between the Date of Grant and the date of any
relevant taxable event, the Grantee 

 

3

 

acknowledges
that the Company may be required to withhold or account for Tax-Related Items
in more than one jurisdiction.

 

Prior
to the relevant taxable event, the Grantee shall pay or make adequate
arrangements satisfactory to the Company to satisfy all Tax-Related Items.  In this regard, the Grantee authorizes the
Company to withhold all applicable Tax-Related Items legally payable by the
Grantee first from the shares pursuant to this Restricted Stock Incentive Award
and, if not sufficient, from the Grantee’s wages or other cash
compensation.  The Grantee shall pay to
the Company any amount of Tax-Related Items that the Company may be required to
withhold as a result of the Grantees receipt of this Restricted Stock Incentive
Award that cannot be satisfied by the means previously described.

 

Notwithstanding
its availability, the Grantee expressly agrees not to make an election pursuant
to Section 83(b) of the U.S. Internal Revenue Code with respect to
the shares of Restricted Stock granted pursuant to these Terms and Conditions.

 

8.
            COMPLIANCE
WITH LAW.  The Company will make
reasonable efforts to comply with all federal, state and non-U.S. laws
applicable to awards of this type. 
However, if it is not feasible for the Company to comply with these laws
with respect to the grant or settlement of these awards, then the awards may be
cancelled without any compensation or additional benefits provided to Grantee
as a result of the cancellation.

 

9.             RELATION TO OTHER
BENEFITS.  The benefits
received by the Grantee under these Terms and Conditions will not be taken into
account in determining any benefits to which the Grantee may be entitled under
any profit sharing, retirement or other benefit or compensation plan maintained
by the Company, including the amount of any life insurance coverage available
to any beneficiary of the Grantee under any life insurance plan covering
employees of the Company.  Additionally,
this Restricted Stock Incentive Award is not part of normal or expected
compensation or salary for any purposes, including, but not limited to
calculation of any severance, resignation, termination, redundancy, end of
service payments, bonuses or long-service awards.  The grant of this Restricted Stock Incentive
Award does not create any contractual or other right to receive future grants
of Restricted Stock Incentive Awards or benefits in lieu of Restricted Stock
Incentive Awards, even if Grantee has a history of receiving Restricted Stock
Incentive Awards or other cash or stock awards.

 

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

 

11.           SEVERABILITY.  If one or more of the provisions of these
Terms and Conditions is invalidated for any reason by a court of competent
jurisdiction, the invalidated provisions 

 

4

 

shall
be deemed to be separable from the other provisions of these Terms and
Conditions, and the remaining provisions of these Terms and Conditions will
continue to be valid and fully enforceable.

 

12.           ENTIRE AGREEMENT;
RELATION TO PLAN; INTERPRETATION. 
Except as specifically provided in this Section, these Terms and
Conditions and the Attachments incorporated in these Terms and Conditions
constitute the entire agreement between the Company and the Grantee with respect
to this Restricted Stock Incentive Award. 
These Terms and Conditions are subject to the terms and conditions of
the Plan.  In the event of any
inconsistent provisions between these Terms and Conditions and the Plan, the
provisions of the Plan control. 
Capitalized terms used in these Terms and Conditions without definitions
have the meanings assigned to them in the Plan. 
References to Sections and Attachments are to Sections of, and
Attachments incorporated in, these Terms and Conditions unless otherwise noted.

 

13.           SUCCESSORS AND ASSIGNS.  Subject to Sections 2 and 3, the provisions
of these Terms and Conditions shall be for the benefit of, and be binding upon,
the successors, administrators, heirs, legal representatives and assigns of the
Grantee, and the successors and assigns of the Company.

 

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

 

15.           PRIVACY RIGHTS.  By accepting this Restricted Stock Incentive Award, the Grantee explicitly and unambiguously
consents to the collection, use and transfer, in electronic or other form, of
the Grantee’s personal data as described in these Terms and Conditions by and
among, as applicable, the Company and its affiliates for the exclusive purpose
of implementing, administering and managing the Grantee’s participation in the
Plan.  The Grantee understands
that the Company holds, or may receive from any agent designated by the
Company, certain personal information about the Grantee, including, but not
limited to, the Grantee’s name, home address and telephone number, date of
birth, social insurance number or other identification number, salary,
nationality, job title, any shares of stock or directorships held in the
Company, details of this Restricted Stock Incentive Award or any other
entitlement to cash or shares of stock awarded, canceled, exercised, vested,
unvested or outstanding in the Grantee’s favor, for the purpose of
implementing, administering and managing the Plan, including complying with
applicable tax and securities laws (“Data”). 
Data may be transferred to any third parties assisting in the
implementation, administration and management of the Plan.  These recipients may be located in the
Grantee’s country or elsewhere, and may have different data privacy laws and
protections than the Grantee’s country. 
By accepting these Terms and Conditions, the Grantee authorizes the
recipients to receive, possess, use, retain and transfer the Data, in
electronic or other form, for the purposes described above.  The Grantee may, at any time, view Data,
request additional information about the storage and processing of Data,
require any necessary amendments to Data or refuse or withdraw the consents
herein, in any case without 

 

5

 

cost,
by contacting the Committee in writing. 
Refusing or withdrawing consent may affect the Grantee’s ability to
participate in the Plan.

 

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

 

17.           GRANTEE’S REPRESENTATIONS
AND RELEASES.  By accepting
this Restricted Stock Incentive Award, the Grantee acknowledges that the
Grantee has read these Terms and Conditions and understands that (i) the
grant of this Restricted Stock Incentive Award is made voluntarily by
Occidental in its discretion with no liability on the part of any of its direct
or indirect subsidiaries and that, if the Grantee is not an employee of
Occidental, the Grantee is not, and will not be considered, an employee of
Occidental but the Grantee is a third party (employee of a subsidiary) to whom
this Restricted Stock Incentive Award is granted; (ii) all decisions with
respect to future awards, if any, will be at the sole discretion of Occidental;
(iii) the Grantee’s participation in the Plan is voluntary; (iv) this
Restricted Stock Incentive Award is an extraordinary item that does not
constitute a regular and recurring item of base compensation; (v) the
future value of any Shares issued pursuant to this Restricted Stock Incentive
Award cannot be predicted and Occidental does not assume liability in the event
this Restricted Stock Incentive Award has no value in the future; (vi) subject
to the terms of any tax equalization agreement between the Grantee and the
entity employing the Grantee, the Grantee will be solely responsible for the
payment or nonpayment of taxes imposed or threatened to be imposed by any
authority of any jurisdiction; and (vii) Occidental is not providing any
tax, legal or financial advice with respect to this Restricted Stock Incentive
Award or the Grantee’s participation in the Plan.

 

In
consideration of the grant of this Restricted Stock Incentive Award, no claim
or entitlement to compensation or damages shall arise from termination of this
Restricted Stock Incentive Award or diminution in value of this Restricted
Stock Incentive Award resulting from termination of the Grantee’s employment by
the Company (for any reason whatsoever) and, to the extent permitted by law,
the Grantee irrevocably releases the Company from any such claim that may
arise; if, notwithstanding the foregoing, any such claim is found by a court of
competent jurisdiction to have arisen, then, by accepting this Restricted Stock
Incentive Award, the Grantee shall be deemed irrevocably to have waived his or
her entitlement to pursue such claim.

 

By
accepting this Restricted Stock Incentive Award, the Grantee agrees, to the
extent not contrary to applicable law, to the General Terms of Employment set
out on Attachment 1 and the Arbitration Provisions set out on Attachment 2,
which, in each case, are incorporated in these Terms and Conditions by
reference.

 

6

 

18.           IMPOSITION OF OTHER
REQUIREMENTS.  Occidental
reserves the right to impose other requirements on the Grantee’s participation
in the Plan and on the Restricted Stock Incentive Award, to the extent
Occidental determines it is necessary or advisable in order to comply with
local law or facilitate the administration of the Plan, and to require the
Grantee to sign any additional agreements or undertakings that may be necessary
to accomplish the foregoing.

 

19.           COMPLIANCE
WITH SECTION 409A OF THE CODE. 
This award is intended to be exempt from Section 409A of the U.S.
Internal Revenue Code (“Section 409A”) under Treas. Reg. § 1.409A-1(b)(6) (or
any successor provision). Notwithstanding the foregoing, to the extent that the
Board determines that the Plan or this award is subject to Section 409A,
these Terms and Conditions shall be interpreted and administered in such a way
as to comply with the applicable provisions of Section 409A to the maximum
extent possible.  To the extent that the
Board determines that the Plan or this award is subject to Section 409A
and fails to comply with the requirements of Section 409A, the Board
reserves the right (without any obligation to do so) to amend or terminate the
Plan and/or amend, restructure, terminate or replace this award in order to
cause this award to either not be subject to Section 409A or to comply
with the applicable provisions of such section.

 

7

 

Attachment 1

 

General Terms of Employment

 

A.            Except as otherwise required by law
or legal process, the Grantee will not publish or divulge to any person, firm,
corporation or institution and will not use to the detriment of Occidental, or
any of its subsidiaries or other affiliates, or any of their respective
officers, directors, employees or stockholders (collectively, “Occidental
Parties”), at any time during or after the Grantee’s employment by any of them,
any trade secrets or confidential information of any of them (whether generated
by them or as a result of any of their business relationships), including such
information as described in Occidental’s Code of Business Conduct and other
corporate policies, without first obtaining the written permission of an
officer of the Company.

 

B.            At the time of leaving employment
with the Company, the Grantee will deliver to the Company, and not keep or
deliver to anyone else, any and all credit cards, drawings, blueprints,
specifications, devices, notes, notebooks, memoranda, reports, studies,
correspondence and other documents, and, in general, any and all materials
relating to the Occidental Parties (whether generated by them or as a result of
their business relationships), including any copies (whether in paper or
electronic form), that the Grantee has in the Grantee’s possession or control.

 

C.            The Grantee will, during the Grantee’s
employment by the Company, comply with the provisions of Occidental’s Code of
Business Conduct.

 

D.            Except as otherwise required by the
Grantee’s job or permitted by law, the Grantee will not make statements about
any Occidental Parties (1) to the press, electronic media, to any part of
the investment community, to the public, or to any person connected with,
employed by or having a relationship with any of them without permission of an
officer of the Company or (2) that are derogatory, defamatory or negative.  Nothing herein, however, shall prevent
Grantee from making a good faith report or complaint to appropriate
governmental authorities.  To the fullest
extent permitted by law, Grantee will not interfere with or disrupt any of the
Company’s operations or otherwise take actions intended directly to harm any of
the Occidental Parties.

 

E.             All inventions, developments,
designs, improvements, discoveries and ideas that the Grantee makes or
conceives in the course of employment by the Company, whether or not during
regular working hours, relating to any design, article of manufacture, machine,
apparatus, process, method, composition of matter, product or any improvement
or component thereof, that are manufactured, sold, leased, used or under
development by, or pertain to the present or possible future business of the
Company shall be a work-for-hire and become and remain the property of
Occidental, its successors and assigns.

 

The
provisions of this Section do not apply to an invention that qualifies
fully under the provisions of Section 2870 of the California Labor Code,
which provides in 

 

8

 

substance
that provisions in an employment agreement providing that an employee
shall assign or offer to assign rights in an invention to his or her employer
do not apply to an invention for which no equipment, supplies, facilities, or
trade secret information of the employer was used and which was developed
entirely on the employee’s own time, except for those inventions that either
(a) relate, at the time of conception or reduction to practice of the
invention, (1) to the business of the employer or (2) to the employer’s
actual or demonstrably anticipated research or development, or (b) result
from any work performed by the employee for the employer.

 

F.             The foregoing General Terms of
Employment are not intended to be an exclusive list of the employment terms and
conditions that apply to the Grantee. 
The Company, in its sole discretion, may at any time amend or supplement
the foregoing terms.  The Grantee’s
breach of the foregoing General Terms of Employment will entitle the Company to
take appropriate disciplinary action, including, without limitation, reduction
of the Restricted Stock Incentive Award granted pursuant to these Terms and
Conditions and termination of employment.

 

9

 

Attachment 2

 

Arbitration Provisions

 

Any dispute arising out of or in any way related to the Grantee’s
employment with the Company, or the termination of that employment, will be
decided exclusively by final and binding arbitration pursuant to any procedures
required by applicable law.  To the
extent not inconsistent with applicable law, any arbitration will be submitted
to American Arbitration Association (“AAA”) and subject to AAA Employment
Arbitration Rules and Mediation Procedures in effect at the time of filing
of the demand for arbitration.  Only the
following claims are excluded from these Terms and Conditions: (1) claims
for workers’ compensation, unemployment compensation, or state disability
benefits, and claims based upon any pension or welfare benefit plan the terms
of which contain an arbitration or other non-judicial dispute resolution
procedure, (2) to the extent permitted by applicable law, claims for
provisional remedies to maintain the status quo pending the outcome of
arbitration, (3) claims based on compensation award agreements and
incentive plans and (4) claims which are not permitted by applicable law
to be subject to a binding pre-dispute arbitration agreement.

 

Any controversy regarding whether a particular dispute is subject to
arbitration under this Section shall be decided by the arbitrator.

 

To the extent required under applicable law, the Grantee’s
responsibility for payment of the neutral arbitrator’s fees and expenses shall
be limited to an amount equal to the filing fee that would be required for a
state trial court action and the Company shall pay all remaining fees and
expenses of the arbitrator.  Unless otherwise
required under applicable law, the parties shall each pay their pro rata share
of the neutral arbitrator’s expenses and fees. 
Any controversy regarding the payment of fees and expenses under this
arbitration provision shall be decided by the arbitrator.

 

The arbitrator may award any form of remedy or relief (including
injunctive relief) that would otherwise be available in court.  Any award pursuant to said arbitration shall
be accompanied by a written opinion of the arbitrator setting forth the reason
for the award.  The award rendered by the
arbitrator shall be conclusive and binding upon the parties hereto, and
judgment upon the award may be entered, and enforcement may be sought in, any
court of competent jurisdiction. To the extent not inconsistent with applicable
laws, the arbitrator will have the authority to hear and grant motions.

 

10

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