Document:

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                                                                    EXHIBIT 10.3

                        OCCIDENTAL PETROLEUM CORPORATION

                          SUPPLEMENTAL RETIREMENT PLAN

              Amended and Restated Effective as of January 1, 1999
             [Reflecting Amendments Effective through March 1, 2001]

<PAGE>   2

                        OCCIDENTAL PETROLEUM CORPORATION
                          SUPPLEMENTAL RETIREMENT PLAN
              Amended and Restated Effective as of January 1, 1999
             [Reflecting Amendments Effective through March 1, 2001]

                                TABLE OF CONTENTS

<TABLE>
<CAPTION>
SECTION                                                                             PAGE
<S>                                                                                 <C>
                                    ARTICLE I
                            ESTABLISHMENT AND PURPOSE

1.1     Establishment and Purpose                                                     1
1.2     Application of Plan                                                           1

                                   ARTICLE II
                                   DEFINITIONS

2.1     Definitions                                                                   2
2.2     Gender and Number                                                             4

                                   ARTICLE III
                          ELIGIBILITY AND PARTICIPATION

3.1     Participation Prior to 1999                                                   5
3.2     Participation after 1998                                                      5

                                   ARTICLE IV
                                    BENEFITS

4.1     Allocations Relating to the Retirement Plan                                   7
4.2     Allocations Relating to the Savings Plan                                      8
4.3     Allocations Relating to the Deferred Compensation Plan                        8
4.4     Contributions                                                                 9
4.5     Maintenance of Accounts                                                       9
4.6     Vesting and Forfeiture                                                       10
4.7     Payment                                                                      10
4.8     Death                                                                        12
4.9     Tax Withholding                                                              13
4.10    Termination of Employment                                                    13

                                    ARTICLE V
                                 ADMINISTRATION

5.1     Administrative Committee                                                     14
5.2     Uniform Rules                                                                14
5.3     Notice of Address                                                            15
5.4     Records                                                                      15
</TABLE>

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<PAGE>   3

                        OCCIDENTAL PETROLEUM CORPORATION
                          SUPPLEMENTAL RETIREMENT PLAN
              Amended and Restated Effective as of January 1, 1999
             [Reflecting Amendments Effective through March 1, 2001]

                                TABLE OF CONTENTS

<TABLE>
<CAPTION>
SECTION                                                                             PAGE
<S>                                                                                 <C>
                                   ARTICLE VI
                            AMENDMENT AND TERMINATION

6.1     Amendment and Termination                                                    16
6.2     Reorganization of Employer                                                   16
6.3     Protected Benefits                                                           16

                                   ARTICLE VII
                                CLAIMS PROCEDURE

7.1     Claims and Appeals Procedure                                                 18

                                  ARTICLE VIII
                               GENERAL PROVISIONS

8.1     Nonassignability                                                             21
8.2     Employment Rights                                                            21
8.3     Illegality of Particular Provision                                           21
8.4     Applicable Laws                                                              21

                                   APPENDIX A
</TABLE>

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                        OCCIDENTAL PETROLEUM CORPORATION
                          SUPPLEMENTAL RETIREMENT PLAN
              Amended and Restated Effective as of January 1, 1999
             [Reflecting Amendments Effective through March 1, 2001]

                                    ARTICLE I
                            ESTABLISHMENT AND PURPOSE

        1.1 Establishment and Purpose. Occidental Petroleum Corporation (the
"Company") hereby amends and restates the OCCIDENTAL PETROLEUM CORPORATION
SUPPLEMENTAL RETIREMENT PLAN (the "Plan") effective as of January 1, 1999. The
restatement reflects the merger of the Plan with the Occidental Petroleum
Corporation Senior Executive Supplemental Retirement Plan (the "SESRP"). The
Plan is intended to be exempt from the participation, vesting, funding, and
fiduciary requirements of Title I of the Employee Retirement Income Security Act
of 1974, as amended ("ERISA"), as an unfunded plan maintained primarily for the
purpose of providing deferred compensation for a select group of management or
highly compensated employees.

        1.2 Application of Plan. The terms of the Plan are applicable to
Employees and former Employees who were participants in the Plan and the SESRP
on December 31, 1998 and eligible Employees employed by an Employer on or after
January 1, 1999. Appendix A to this Plan contains certain provisions that apply
only to Participants who were participants in the SESRP prior to January 1,
1999.

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                                   ARTICLE II
                                   DEFINITIONS

        2.1 Definitions. Whenever the following words and phrases are used in
the Plan with the first letter capitalized, they shall have the meanings
specified below, unless the context clearly indicates otherwise:

        (a)     "ADMINISTRATIVE COMMITTEE" means the committee with authority to
                administer the Plan as provided under Section 5.1.

        (b)     "AFFILIATE" means: (i) any corporation which is a member of a
                controlled group of corporations (within the meaning of Code
                Section 1563(a), determined without regard to Code Sections
                1563(a)(4) and (e)(3)(C), and with the phrase "more than 50%"
                substituted for the phrase "at least 80%" each place it appears
                in Code Section 1563(a)) of which Occidental Petroleum
                Corporation is a component member, or (ii) any entity (whether
                or not incorporated) which is under common control with
                Occidental Petroleum Corporation (as defined in Code Section
                414(c) and the Treasury Regulations thereunder, and with the
                phrase "more than 50%" substituted for the phrase "at least 80%"
                each place it appears in the Treasury Regulations under Code
                Section 414(c)).

        (c)     "BENEFICIARY" means the person(s) entitled to receive the
                Participant's benefits under the Retirement Plan in the event of
                the Participant's death.

        (d)     "BOARD OF DIRECTORS" means the Board of Directors of the
                Company.

        (e)     "CODE" means the Internal Revenue Code of 1986, as amended.

        (f)     "COMPANY" means Occidental Petroleum Corporation, and any
                successor thereto.

        (g)     "COMPENSATION" means the base salary of an Employee as stated in
                the payroll records of his Employer, excluding any amounts paid
                for bonuses, income

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                realized upon exercise of stock options, and any other special
                pay which the Employer pays to the Employee during the Plan
                Year, prior to reduction for any deferral of base salary under
                the Savings Plan, Deferred Compensation Plan or any other
                qualified or non-qualified deferred compensation plan or
                agreement. In the case of a Participant who became disabled
                prior to October 1, 1995 and who is receiving benefits under the
                Long-Term Disability Plan, Compensation shall be his base salary
                as described above in effect at the time he became disabled, as
                that term is defined in the Long-Term Disability Plan.

        (h)     "DEFERRED COMPENSATION PLAN" means the OCCIDENTAL PETROLEUM
                CORPORATION DEFERRED COMPENSATION PLAN, as amended from time to
                time.

        (i)     "EMPLOYEE" means an employee of an Employer.

        (j)     "EMPLOYER" means the Company and any Affiliate which is
                designated by the Administrative Committee as an Employer and
                which adopts this Plan.

        (k)     "LONG-TERM DISABILITY PLAN" means the OCCIDENTAL PETROLEUM
                CORPORATION LONG-TERM DISABILITY PLAN, as amended from time to
                time.

        (l)     "PARTICIPANT" means a person meeting the requirements set forth
                in Article III to participate in the Plan.

        (m)     "PLAN YEAR" means the calendar year

        (n)     "RETIREMENT PLAN" means the OCCIDENTAL PETROLEUM CORPORATION
                RETIREMENT PLAN, as amended from time to time.

        (o)     "SAVINGS PLAN" means the OCCIDENTAL PETROLEUM CORPORATION
                SAVINGS PLAN, as amended from time to time.

                                       3
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        (p)     "SESRP" means the OCCIDENTAL PETROLEUM CORPORATION SENIOR
                EXECUTIVE SUPPLEMENTAL RETIREMENT PLAN, as in effect on December
                31, 1998.

        2.2 Gender and Number. Except when otherwise indicated by the context,
any masculine terminology used herein shall also include the feminine, and the
use of any term herein in the singular may also include the plural.

                                       4
<PAGE>   8

                                   ARTICLE III
                          ELIGIBILITY AND PARTICIPATION

        3.1 Participation Prior to 1999. Any Employee who was a Participant as
of December 31, 1998 shall continue to be a Participant effective January 1,
1999. Additionally, any Employee who was a participant in the SESRP on December
31, 1998 shall become a Participant on January 1, 1999.

        3.2 Participation after 1998. The provisions set forth in this Section
3.2 shall be effective as of January 1, 1999 and shall apply to Employees who
are not Participants pursuant to Section 3.1.

        Any Employee who (a) either is eligible to participate in the Savings
Plan and the Retirement Plan, or is a "Transition Eligible Participant" (as
defined in Section 1.34 of the Oxy Permian Cash Balance Retirement Plan, as in
effect on December 31, 2000), and (b) for a given plan year of the Savings Plan,
would be ineligible to receive the maximum employer matching contribution under
Section 5.1 of the Savings Plan due to the limitations imposed by Code Section
401(a)(17) (which limits the amount of compensation which may be taken into
account) or Code Section 415 (assuming the second paragraph of Section 4.7 of
the Retirement Plan is applicable to the Employee) if he had made the maximum
deferral or contribution permitted under Article 4 of the Savings Plan, shall be
a Participant.

        In addition, any Employee who would be ineligible to receive the maximum
employer matching contribution under Section 5.1 of the Savings Plan in a plan
year of the Savings Plan, due to the limitations described in the preceding
paragraph, on account of deferrals of base salary during the year under any
nonqualified pension benefit plan sponsored by the Company or an

                                       5
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Affiliate in which the Participant participates, shall be a Participant in this
Plan for that Plan Year.

        Any Employee who is eligible to participate in the Deferred Compensation
Plan shall be a Participant.

        Any Employee who is a participant in, and receiving benefits under the
Long-Term Disability Plan and who was a highly-compensated employee (as defined
in Code Section 414(q)) in the year of his commencement of benefits under the
Long-Term Disability Plan, shall be a Participant for each Plan Year during
which he receives benefit payments under the Long-Term Disability Plan, provided
that no such Employee who becomes disabled under the terms of the Long-Term
Disability Plan subsequent to September 30, 1995 shall be a Participant.

        Notwithstanding anything contained herein, any Employee who is entitled
to receive supplemental retirement benefits upon his retirement pursuant to a
written contract of employment between himself and the Company or an Affiliate
shall be ineligible to be a Participant effective January 1 of the year after
the effective date of such contractual provision.

                                       6
<PAGE>   10

                                   ARTICLE IV
                                    BENEFITS

        4.1 Allocations Relating to the Retirement Plan. A credit shall be made
as of the last day of each month to a contingent account for each Participant.
The amount to be allocated shall equal the amount which would be allocated to
the account of the Participant for the month under the Retirement Plan, based on
the Participant's Compensation, if the Participant were not subject to
provisions that withhold allocations until the end of the plan year of the
Retirement Plan. For Participants covered under this Plan, allocations under the
Retirement Plan are determined at the end of the plan year of the Retirement
Plan, to the extent allowable under Code limitations. The amounts contingently
credited under this Section 4.1 during the year to a Participant who is an
Employee at the end of the Plan Year shall be reduced by the amount actually
allocated to his account under the Retirement Plan, and any remaining amount
shall be credited permanently to his account under this Plan. In the case of a
Participant who is not an Employee at the end of the Plan Year (including
Participants described in the fifth paragraph of Section 3.2), the amounts
contingently credited under this Section 4.1 during the year shall be credited
permanently to his account under this Plan.

        The Employer shall also permanently credit to each Participant's
account, earnings on contingent monthly allocations under the preceding
paragraph for the year as if such contingent allocations shared in earnings at
the rate and in the manner described in Section 4.5 Notwithstanding the
foregoing, any earnings attributable to the Retirement Plan previously credited
to the account of a Participant under the Plan during the current or any
preceding plan year shall be reallocated to the account of the Participant under
the Retirement Plan in any year when it is permissible to do so under Code
limitations.

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<PAGE>   11

        4.2 Allocations Relating to the Savings Plan. A credit shall be made as
of the last day of the Plan Year to the account of each Participant in an amount
equal to (A) -- (B), where (A) is the amount of employer matching contributions
that could not have been allocated to the Participant under Section 5.1 of the
Savings Plan during that Plan Year due to the limitations imposed by Sections
401(a)(17) or 415 of the Code if such Participant had made the maximum deferral
or contribution permitted under Article 4 of the Savings Plan, and (B) is any
such amount which is credited on behalf of the Participant during that Plan Year
under any other nonqualified pension benefit plan sponsored by the Company or an
Affiliate. An additional amount equal to five percent (5%) of the amount
allocated to the Participant under the preceding sentence shall be allocated to
each Participant in lieu of interest on such amount for the Plan Year.

        4.3 Allocations Relating to the Deferred Compensation Plan. A credit
shall be made to the account of each Participant who, in that Plan Year, is
eligible to participate in the Deferred Compensation Plan and the Retirement
Plan. Such credit shall be made irrespective of whether such Participant elects
to defer under the Deferred Compensation Plan all or any part of any bonus to
which he might be entitled. Notwithstanding the preceding sentence, no credit
shall be made to the account of a Participant who is not an Employee on the date
that any such bonus is awarded. The amount to be allocated in a Plan Year under
this Plan with respect to a Participant shall equal that Participant's
applicable percentage multiplied by the amount of the bonus he is entitled to
elect to defer for that plan year of the Deferred Compensation Plan. For the
purpose of this Section 4.3, the term "applicable percentage" shall mean twelve
percent (12%) in the case of a Participant who shall have attained age 35 prior
to the end of the Plan Year in which such credit is made and eight percent (8%)
in the case of a Participant who shall not have attained age 35 prior to the end
of the Plan Year in which such credit is made. The credit described in this
Section shall be made to the account of each Participant effective as of the
date on which he is

                                       8
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awarded the bonus he is entitled to defer under the Deferred Compensation Plan.
Notwithstanding the preceding provisions of this Section 4.3, no credit shall be
made to the account of any Participant with respect to any bonus that the
Participant is entitled to elect to defer under the Deferred Compensation Plan
with respect to services performed prior to January 1, 1998.

        4.4 Contributions. At the end of each year the Employer by which a
Participant is then employed shall contribute to a grantor trust an amount equal
to the amounts permanently allocated to the Participant under Sections 4.1, 4.2
and 4.3 for that Plan Year.

        4.5 Maintenance of Accounts.

                (a)     Each Employer shall establish and maintain, in the name
                        of each Participant employed by that Employer, an
                        individual account which shall consist of all amounts
                        permanently credited to the Participant. As of the end
                        of each month, the Administrative Committee shall
                        increase or decrease the balance, if any, of the
                        Participant's individual account as of the last day of
                        the preceding month, by multiplying such amount by a
                        number equal to one plus .167% plus the monthly yield on
                        5-Year Treasury Constant Maturities for the monthly
                        processing period. As of December 31st of each year the
                        Administrative Committee shall then add to such account
                        balance, any permanent allocation to which the
                        Participant is entitled for such year.

                (b)     The individual account of each Participant shall
                        represent a liability, payable when due under this Plan,
                        out of the general assets of the Employer, or from the
                        assets of any trust, custodial account or escrow
                        arrangement which the Employer may establish for the
                        purpose of

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                        assuring availability of funds sufficient to pay
                        benefits under this Plan. The money and any other assets
                        in any such trust or account shall at all times remain
                        the property of the Employer, and neither this Plan nor
                        any Participant shall have any beneficial ownership
                        interest in the assets thereof. No property or assets of
                        the Employer shall be pledged, encumbered, or otherwise
                        subjected to a lien or security interest for payment of
                        benefits hereunder. Accounting for this Plan shall be
                        based on generally accepted accounting principles.

                (c)     If a Participant transfers employment from one Employer
                        to another, the liability for such Participant's
                        benefits under the Plan shall also be transferred to the
                        successor Employer.

        4.6 Vesting and Forfeiture. All benefits under this Plan shall be
contingent and forfeitable and no Participant shall have a vested interest in
any benefit unless, while he is still employed by an Employer, he becomes fully
vested in his benefit under the Retirement Plan (or would have become vested if
he were a participant in the Retirement Plan). A person who terminates
employment with an Employer for any reason prior to becoming vested hereunder
shall not receive a benefit, provided that, upon rehire by an Employer, any
amounts forfeited by a Participant at the time of his termination of employment
shall be restored, without interest, to his account.

        4.7 Payment. Every Participant who terminates employment shall, if
vested, have his account distributed to him as soon as practicable following his
termination of employment under one of the following distribution options
elected by the Participant on a form prescribed by the Administrative Committee:

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                        (a) One lump sum payment, provided that, effective as of
                        March 1, 2001, in the case of a Participant whose
                        individual account balance exceeds $20,000 at the time
                        of his termination of employment, such lump sum payment
                        shall be made during the first quarter of the calendar
                        year following the calendar year of his termination of
                        employment; or

                        (b) Annual installment payments payable over 5, 10, 15,
                        or 20 years commencing in the first quarter of the
                        calendar year following the calendar year in which he
                        terminates employment. Annual installment payments shall
                        be available only to Participants whose individual
                        account balances exceed $20,000 at the time of their
                        termination of employment in the case of a termination
                        on or after March 1, 2001, or $2,000 in the case of a
                        termination prior to March 1, 2001, notwithstanding any
                        contrary elections by the Participant.

The election must be made by the Participant as soon as practicable after his
commencement of participation in the Plan, but in no event later than the end of
the twelve month period beginning with such commencement. An election form shall
be provided to the Participant in non-technical language and shall contain a
general description of the distribution options. If a Participant fails to make
an election by the close of the twelve month period beginning on the
commencement of his participation, he will be deemed to have elected to receive
his benefits in the form of a lump sum payment.

The Administrative Committee, in its sole discretion, may permit a Participant
to change his election as to the form of payment upon written petition of the
Participant. In order to be effective, a Participant's election (or modification
or revocation of prior election) of the form of payment must be made not later
than twelve months before the Participant's retirement or

                                       11
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termination of employment, unless otherwise permitted by the Administrative
Committee. Subject to the foregoing limitation, a Participant may make such
election (or revoke a prior election and make a new election) at any time. Any
election (or modification or revocation of a prior election) which is made later
than twelve months prior to the Participant's retirement or termination of
employment will be considered void and shall have no force or effect, except as
otherwise determined by the Administrative Committee.

        If benefits are to be paid in installments, the Participant's account
will continue to be adjusted until any series of installments has been
completed. The amount of each annual installment shall equal the amount credited
to the account as of January 31 of the year in which the installment is to be
paid, multiplied by a fraction, the numerator of which is 1, and the denominator
of which is the number of installments (including the current one) which remain
to be paid. Each installment shall be paid as soon as administratively possible
after January 31 of the calendar year.

        Notwithstanding anything else contained in this Section 4.7, no
Participant who is eligible for Employer-provided long-term disability benefits
and who became disabled prior to October 1, 1995, shall be entitled to a
distribution of benefits hereunder prior to the time long-term disability
payments cease.

        4.8 Death. The account of a Participant who dies prior to termination of
employment shall be paid in a single sum to the Participant's Beneficiary as
soon as administratively possible following the date of the Participant's death.
If a Participant dies after termination of employment, then his surviving
Beneficiary shall be paid the amount in the Participant's account in a single
sum as soon as administratively possible following the date of the Participant's
death.

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        4.9 Tax Withholding. To the extent required by the law in effect at the
time payments are made, the Employer shall withhold from payments made
hereunder, the taxes required to be withheld by federal, state and local
governments.

        4.10 Termination of Employment. For the purposes of the termination of
employment provisions of the Plan, a Participant will be deemed to have
terminated employment if the Participant ceases to be an employee of any of the
following:

                (a)     an Employer;

                (b)     an Affiliate, regardless of whether the Affiliate is an
                        Employer; or

                (c)     any other entity, whether or not incorporated, in which
                        the Company has an ownership interest, and the
                        Administrative Committee has designated that the
                        Participant's commencement of employment with such
                        entity upon the Participant's ceasing to be an employee
                        of an entity described in (a) or (b) above will not be
                        deemed to be a termination of employment for purposes of
                        this Plan, provided that such designation shall be made
                        in writing by the Administrative Committee and shall be
                        communicated to the Participant prior to his
                        commencement of employment with the entity so
                        designated.

For purposes of the preceding provisions, a Participant who ceases to be an
employee of an entity described in (a), (b) or (c) above shall not be deemed to
have terminated employment if such cessation of employment is followed
immediately by his commencement of employment with another entity described in
(a), (b) or (c) above.

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                                    ARTICLE V
                                 ADMINISTRATION

        5.1 Administrative Committee. The Plan shall be administered by the
committee appointed to administer the Retirement Plan (the "Administrative
Committee").

        The interpretation and construction by the Administrative Committee of
any provisions of the Plan shall be final unless otherwise determined by the
Board of Directors. Subject to directions from the Board of Directors, the
Administrative Committee is authorized to construe and interpret the Plan, to
supply all omissions from, correct deficiencies in, and resolve ambiguities in
the language of the Plan, to decide all questions of eligibility and determine
the amount, manner and time of payment of benefits, to prescribe, amend and
rescind rules and regulations relating to the Plan, and to make all other
determinations necessary for its administration.

        Without limiting the generality of the foregoing, the Administrative
Committee shall have the authority to calculate amounts allocable to
Participants, and to maintain and adjust accounts. The Administrative Committee
shall have authority to delegate responsibility for performance of ministerial
functions necessary for administration of the Plan to such officers of the
Employer, including Participants, as the Administrative Committee shall in its
discretion deem appropriate.

        5.2 Uniform Rules. In administering the Plan, the Administrative
Committee will apply uniform rules to all Participants similarly situated.

                                       14
<PAGE>   18

        5.3 Notice of Address. Any payment to a Participant or Beneficiary, at
the last known post office address submitted to the Employer, shall constitute a
complete acquittance and discharge of the Employer and any director or officer
with respect thereto. Neither the Employer nor any director or officer shall
have any duty or obligation to search for or ascertain the whereabouts of any
Participant or Beneficiary.

        5.4 Records. The records of the Administrative Committee with respect to
the Plan shall be conclusive on all Participants, all Beneficiaries, and all
other persons whomsoever.

                                       15
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                                   ARTICLE VI
                            AMENDMENT AND TERMINATION

        6.1 Amendment and Termination. The Company expects the Plan to be
permanent, but since future conditions affecting the Company cannot be
anticipated or foreseen, the Company must necessarily and does hereby reserve
the right to amend, modify, or terminate the Plan at any time by action of its
Board of Directors, except that no amendment shall reduce the dollar amount
credited to a Participant's account and any such termination or amendment shall
apply uniformly to all Participants. The Administrative Committee, in its
discretion, may amend the Plan if it finds that such amendment does not
significantly increase or decrease benefits or costs.

        6.2 Reorganization of Employer. In the event of a merger or
consolidation of the Employer, or the transfer of substantially all of the
assets of the Employer to another corporation, such continuing, resulting or
transferee corporation shall have the right to continue and carry on the Plan
and to assume all liabilities of the Employer hereunder without obtaining the
consent of any Participant or Beneficiary. If such successor shall assume the
liabilities of the Employer hereunder, then the Employer shall be relieved of
all such liability, and no Participant or Beneficiary shall have the right to
assert any claim against the Employer for benefits under or in connection with
the Plan.

        6.3 Protected Benefits. If the Plan is terminated or amended so as to
prevent further earnings adjustments, or if liabilities accrued hereunder up to
the date of an event specified in Section 6.2 are not assumed by the successor
to the Employer, then the dollar amount in the account of each Participant or
Beneficiary (whether or not vested) shall be paid in cash to such

                                       16
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Participant or Beneficiary in a single sum on the last day of the second month
following the month in which the amendment or termination occurs.

                                       17
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                                   ARTICLE VII
                                CLAIMS PROCEDURE

        7.1 Claims and Appeals Procedures. All applications for benefits under
the Plan shall be submitted to: Occidental Petroleum Corporation, Attention:
Pension and Retirement Plan Administrative Committee, 10889 Wilshire Blvd., Los
Angeles, CA 90024. Applications for benefits must be in writing on the forms
prescribed by the Administrative Committee and must be signed by the
Participant, or in the case of a death benefit, by the Beneficiary or legal
representative of the deceased Participant. Each application shall be acted upon
and approved or disapproved within 60 days following its receipt by the
Administrative Committee. If any application for a benefit is denied, in whole
or in part, the Administrative Committee shall notify the applicant in writing
of such denial and of his right to a review by the Administrative Committee and
shall set forth in a manner calculated to be understood by the applicant,
specified reasons for such denial, specific references to pertinent Plan
provisions on which the denial is based, a description of any additional
material or information necessary for the applicant to perfect his application,
an explanation of why such material or information is necessary, and an
explanation of the Plan's review procedure.

        Any person, or his duly authorized representative, whose application for
benefits is denied in whole or in part, may appeal such denial to the
Administrative Committee for a review of the decision by submitting to the
Administrative Committee within 60 days after receiving notice of the denial, a
written statement:

                (a)     requesting a review of his application for benefits by
                        the Administrative Committee;

                (b)     setting forth all of the grounds upon which his request
                        for review is based and any facts in support thereof;
                        and

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<PAGE>   22

                (c)     setting forth any issues or comments which the applicant
                        deems relevant to his application.

        The Administrative Committee shall act upon each such application within
60 days after the later of receipt of the applicant's request for review by the
Administrative Committee or receipt of any additional materials reasonably
requested by the Administrative Committee from such applicant.

        The Administrative Committee shall make a full and fair review of each
such application and any written materials submitted by the applicant or the
Employer in connection therewith, and may require the Employer or the applicant
to submit within 30 days of written notice by the Administrative Committee
therefor, such additional facts, documents, or other evidence as the
Administrative Committee, in its sole discretion, deems necessary or advisable
in making such a review. On the basis of its review, the Administrative
Committee shall make an independent determination of the applicant's eligibility
for benefits under the Plan. The decision of the Administrative Committee on any
application for benefits shall be final and conclusive upon all persons if
supported by substantial evidence in the record.

        If the Administrative Committee denies an application in whole or in
part, the Administrative Committee shall give written notice of its decision to
the applicant setting forth in a manner calculated to be understood by the
applicant, the specific reasons for such denial and specific references to the
pertinent Plan provisions on which the Administrative Committee's decision was
based.

        No legal action may be commenced prior to the completion of the benefit
claims procedure described herein. In addition, no legal action may be commenced
after the later of (i)

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180 days after receiving the written response of the Administrative Committee to
an appeal, or (ii) 365 days after an applicant's original application for
benefits.

                                       20
<PAGE>   24

                                  ARTICLE VIII
                               GENERAL PROVISIONS

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

        8.2 Employment Rights. The establishment of the Plan shall not be
construed as conferring any legal rights upon any Participant or any other
person for a continuation of employment, nor shall it interfere with the rights
of the Employer to discharge any person or treat him without regard to the
effect which such treatment might have upon him under this Plan.

        8.3 Illegality of Particular Provision. If any particular provision of
this Plan shall be found to be illegal or unenforceable, such provision shall
not affect any other provision, but the Plan shall be construed in all respects
as if such invalid provision were omitted.

        8.4 Applicable Laws. The Plan shall be governed by and construed
according to the laws of the State of California, to the extent such laws are
not preempted by ERISA.

                                       21
<PAGE>   25

        IN WITNESS WHEREOF, the Company has executed this document this ___ day
of _______________, 2001.

                                            OCCIDENTAL PETROLEUM CORPORATION

                                            By
                                               ---------------------------------
                                               Richard W. Hallock
                                               Executive Vice-President, Human
                                               Resources

                                       22
<PAGE>   26

                                   APPENDIX A

             SPECIAL PROVISIONS APPLICABLE TO PARTICIPANTS WHO WERE
              PARTICIPANTS IN THE OCCIDENTAL PETROLEUM CORPORATION
                    SENIOR EXECUTIVE SUPPLEMENTAL RETIREMENT
                            PLAN ON DECEMBER 31, 1998
                        (EFFECTIVE AS OF JANUARY 1, 1999)

        The Plan is the result of the merger of the Occidental Petroleum
Corporation Supplemental Retirement Plan as in effect on December 31, 1998, with
the Occidental Petroleum Corporation Senior Executive Retirement Plan as in
effect on December 31, 1998 (the "SESRP"). The Company has deemed it desirable
to continue certain provisions of the SESRP for the benefit of Participants who
were participants in the SESRP on December 31, 1998. Therefore, this Appendix A
sets forth certain provisions that apply only to Participants who were
participants in the SESRP on December 31, 1998 which provisions supersede any
contrary provisions in the main body of the Plan document as to such
Participants.

        1. Beneficiary. Section 2.1(c) of the Plan shall not apply. Instead,
each Participant shall have the right, at any time, to designate any person or
persons as the Beneficiary to whom payment under the Plan shall be made in the
event of the Participant's death prior to complete distribution to the
Participant of the benefits due under the Plan. Each Beneficiary designation
shall become effective only when filed in writing with the Administrative
Committee during the Participant's lifetime on a form prescribed by the
Administrative Committee. The filing of a new Beneficiary designation form will
cancel any inconsistent Beneficiary designation previously filed. If a
Participant fails to designate a Beneficiary as provided above, or if all
designated Beneficiaries predecease the Participant or die prior to complete
distribution of the Participant's benefits, such benefits shall be paid in
accordance with the Participant's Beneficiary designation under the Retirement
Plan, and if there is no such valid Beneficiary designation, to the
Participant's then surviving spouse, or if none, to the Participant's estate,
until directed otherwise by the court that has jurisdiction over the assets
belonging to the Participant's

                                       A-1
<PAGE>   27

probate estate.

        2. Participation. The fifth paragraph of Section 3.2 of the Plan
(addressing Plan participation by participants receiving benefits under the
Long-Term Disability Plan) shall not apply to Participants.

        3. Payment of Benefits. If a Participant terminates employment prior to
age 55, the lump sum payment or commencement of installment payments under
Section 4.7, whichever is applicable, shall not be made or commence upon
termination of employment, but shall be made or commence as soon as
administratively feasible following the Participant's attainment of age 55.
Further, a Participant may, in his election of a form of payment, elect to have
his distribution made or installments commence at the later of (a) termination
of employment, or (b) attainment of a specified age between 55 and 70-1/2.
Notwithstanding the last sentence of Section 4.7, a Participant who becomes
disabled (as defined in the Retirement Plan) may petition the Administrative
Committee for approval to receive the distribution payable pursuant to Section
4.7 as modified hereby in a single sum or installment at any time even before
the Participant attains age 55.

        4. Contributions and Funding. Section 4.4 shall not apply. The Company,
in its sole discretion, may provide for the funding of Plan benefits, in full or
in part, through a grantor trust or such other means as it deems appropriate.

        5. Death. Section 4.8 of the Plan shall not apply to Participants and no
benefits shall be paid under the Plan upon a Participant's death if payment of a
Participant's account is made under an insurance policy or some other plan or
arrangement of the Company for senior executives.

        6. Withdrawal of Payments with Penalty. Notwithstanding any other
provisions of

                                       A-2
<PAGE>   28

the Plan and this Appendix A, a Participant who has commenced receiving
installment payments under the Plan, may at any time, in lieu of installment
payments in the form previously elected by the Participant, elect to receive an
immediate lump sum payment of all or a part of the vested balance of his
account, reduced by a penalty equal to ten percent (10%) of the amount of such
lump sum withdrawal. Such penalty shall be deducted from the lump sum withdrawal
payment and shall be forfeited to the Company permanently.

        7. Protected Benefits. Section 6.3 of the Plan shall not apply to
Participants. Instead, if the Plan is terminated or amended so as to prevent
further earnings adjustments, or if liabilities accrued hereunder up to the date
of an event specified in Section 6.2 of the Plan are not assumed by the
successor to the Employer, then the dollar amount in the account of each
Participant or Beneficiary (whether or not vested) shall be paid in cash to such
Participant or Beneficiary in three or fewer annual installments (as determined
by the Administrative Committee as constituted immediately before the event that
triggers payment under this Section 5.1), commencing as soon as administratively
feasible following the event that triggers payment under this Section 5.1.

                                       A-3<PAGE>   1

                                                                    EXHIBIT 10.4

                        OCCIDENTAL PETROLEUM CORPORATION
                           DEFERRED COMPENSATION PLAN
             (Amended and Restated Effective as of January 1, 1999)

<PAGE>   2

                        OCCIDENTAL PETROLEUM CORPORATION
                           DEFERRED COMPENSATION PLAN

             (Amended and Restated Effective as of January 1, 1999)

                                    ARTICLE I
                                     PURPOSE

                This OCCIDENTAL PETROLEUM CORPORATION DEFERRED COMPENSATION PLAN
(the "Plan") constitutes the amendment, restatement and merger of the Occidental
Petroleum Corporation 1988 Deferred Compensation Plan (the "1988 DCP") and the
Occidental Petroleum Corporation Senior Executive Deferred Compensation Plan
(the "SEDCP"), effective as of January 1, 1999.

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

                                   ARTICLE II
                                   DEFINITIONS

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

                Affiliate. "Affiliate" means: (i) any corporation which is a
member of a controlled group of corporations (within the meaning of Code Section
1563(a), determined without regard to Code Sections 1563(a)(4) and (e)(3)(C),
and with the phrase "more than 50%" substituted for the phrase "at least 80%"
each place it appears in Code Section 1563(a)) of which Occidental Petroleum
Corporation is a component member, or (ii) any entity (whether or not
incorporated) which is under common control with Occidental Petroleum
Corporation (as defined in Code Section 414(c) and the Treasury Regulations
thereunder, and with the phrase "more than 50%" substituted for the phrase "at
least 80%" each place it appears in the Treasury Regulations under Code Section
414(c)).

                Base Salary. "Base Salary" means a Participant's annual base
salary, excluding Bonus, all severance allowances, forms of incentive
compensation, Savings Plan, Retirement Plan or other Company qualified plan
contributions or benefits, retainers, insurance premiums or benefits,
reimbursements, and all other payments, prior to reduction for any deferrals
under this Plan or any other plan of the Company or reductions under the
Company's Savings Plan allowed under Section 401(k) of the Internal Revenue
Code.

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

                Board. "Board" means the Board of Directors of the Company.

                                       1
<PAGE>   3

                Bonus. "Bonus" means the bonus awarded to a Participant during
the Plan Year in question prior to reduction for any deferral under this Plan or
any other plan of the Company.

                Code. "Code" means the Internal Revenue Code of 1986, as
amended.

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

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

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

                DCP Deferral Account. "DCP Deferral Account" means the account
maintained on the books of account of the Company for each Participant pursuant
to Article IV to account for amounts deferred under the 1988 DCP prior to
January 1, 1999, and for amounts deferred under this amended and restated Plan
after that date.

                DCP Deferral Amount. "DCP Deferral Amount" means an amount of a
Participant's Base Salary and/or Bonus which is deferred under the Plan,
including both amounts deferred under the 1988 DCP prior to January 1, 1999, and
amounts deferred under this amended and restated Plan after that date.

                Declared Rate. "Declared Rate" with respect to any Plan Year
means the interest rate which will be credited on Deferral Accounts for such
Plan Year. The Declared Rate for each Plan Year commencing in 1999 and
thereafter will be equal to the greater of: (i) (A) plus (B) where (A) is the
Moody's Long-Term Corporate Bond Index Monthly Average Corporates as published
by Moody's Investor Services, Inc. (or successor thereto) for the month of July
in the year prior to the Plan Year in question, and (B) is three percent (3%)
("Moodys Plus Three"), or (ii) the highest yield on any unsecured debt or
preferred stock of the Company that was outstanding on the last day of July in
the year prior to the Plan Year in question. The Declared Rate will be announced
on or before January 1 of the applicable Plan Year. Notwithstanding the
foregoing, the Declared Rate for DCP Deferral Amounts which were earned and
deferred prior to 1994 under the 1988 DCP (including bonuses which were earned
for 1993), together with accumulated interest thereon, will in no event be less
than eight percent (8%) for any Plan Year. Accordingly, the Declared Rate for
any Plan Year may be different for DCP Deferral Amounts that were earned and
deferred under the 1988 DCP prior to January 1, 1994 than for DCP Deferral
Amounts earned and deferred after such date.

                Deferral Account(s). "Deferral Account(s)" means a Participant's
DCP Deferral Account and/or SEDCP Deferral Account (if any) maintained on the
books of account of the Company for each Participant pursuant to Article IV.

                Disability. "Disability" means a condition that qualifies as a
disability under the Company's Retirement Plan and approved by the Committee.

                                       2
<PAGE>   4

                Distribution Election Form. "Distribution Election Form" means
an Eligible Employee's written election to receive benefits under the Plan in
annual installments in accordance with Article V.

                Early Payment Benefit. "Early Payment Benefit" means the payment
to a Participant of part or all of the Participant's DCP Deferral Account on an
Early Payment Date prior to Retirement pursuant to Section 5.6.

                Early Payment Date. "Early Payment Date" means any date prior to
Retirement on which a Participant elects to receive an Early Payment Benefit
pursuant to Section 5.6.

                Election Form. "Election Form" means an Eligible Employee's
written, irrevocable election to defer Base Salary and/or Bonus in accordance
with Article IV.

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

                Emergency Benefit. "Emergency Benefit" means the payment to a
Participant of part or all of his Deferral Accounts in the event that the
Participant has an unforeseeable financial emergency pursuant to Section 5.7.

                1988 DCP. "1988 DCP" means the Occidental Petroleum Corporation
1988 Deferred Compensation Plan.

                Participant. "Participant" means: (a) each individual who, as of
December 31, 1998, was a participant in the 1988 DCP or the SEDCP, and (b) an
Eligible Employee who has filed a completed and fully executed Election Form
with the Committee and is participating in the Plan in accordance with the
provisions of Article IV.

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

                Retirement. "Retirement" means: (a) the termination of a
Participant's employment with the Company for reasons other than Disability or
death after the Participant attains age 55 and completes five (5) Years of
Service or, effective January 1, 2001, (b) the Participant's attainment of age
55 following the Participant's termination of employment with the Company for
reasons other than Disability or death prior to attainment of age 55 if the
Participant qualifies for retiree medical coverage under the Occidental
Petroleum Corporation Medical Plan on the date of the Participant's termination
of employment.

                Retirement Benefit. "Retirement Benefit" means the payment to a
Participant of the Participant's Deferral Accounts pursuant to Section 5.1
following Retirement.

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

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

                                       3
<PAGE>   5

                Savings Plan Restoration Account. "Savings Plan Restoration
Account" means the account maintained on the books of account of the Company to
reflect Savings Plan restoration contributions made by the Company pursuant to
Section 4.6.

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

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

                Termination Benefit. "Termination Benefit" means the payment to
a Participant of the Participant's Deferral Accounts pursuant to Section 5.2 on
account of the Participant's termination of employment other than due to
Retirement, Disability or death.

                Termination Event. "Termination Event" means any of the
following:

                        (a) Approval by the stockholders of the Company (or, if
        no stockholder approval is required, by the Board) of the dissolution or
        liquidation of the Company, other than in the context of a transaction
        that does not constitute a Termination Event under clause (b) below;

                        (b) Consummation of 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 (a
        "Business Combination"), unless (i) as a result of the Business
        Combination, more than 50% of the outstanding voting power of the
        surviving or resulting entity or a parent thereof (the "Successor
        Entity") immediately after the Business Combination is, or will be,
        owned, directly or indirectly, by holders of the Company's voting
        securities immediately before the Business Combination; (ii) no "person"
        (as such term is used in Sections 13(d) and 14(d) of the Securities
        Exchange Act of 1934, as amended from time (the "Exchange Act")),
        excluding the Successor Entity or any employee benefit plan of 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 (an "Excluded
        Person"), beneficially owns, directly or indirectly, more than 20% of
        the outstanding shares or the combined voting power of the outstanding
        voting securities of the Successor Entity, after giving effect to the
        Business Combination, except to the extent that such ownership existed
        prior to the Business Combination; and (iii) at least 50% of the members
        of the board of directors of the entity resulting from the Business
        Combination were members of the Board at the time of the execution of
        the initial agreement or of the action of the Board approving the
        Business Combination;

                        (c) Any "person" (as such term is used in Sections 13(d)
        and 14(d) of the Exchange Act, but excluding any Excluded Person) is or
        becomes the beneficial owner (as defined in Rule 13d-3 under the
        Exchange Act), directly or indirectly, of securities of the Company
        representing 20% or more of the combined voting power of the Company's

                                       4
<PAGE>   6

        then outstanding voting securities, other than as a result of (i) an
        acquisition directly from the Company; (ii) an acquisition by the
        Company; or (iii) 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 Board member was approved by a vote of at least two-thirds
        (2/3) of the Board members then still in office who were Board members
        at the beginning of such period (including for these purposes, new
        members whose election or nomination was so approved), but excluding,
        for this purpose, any such individual whose initial assumption of office
        occurs as a result of an actual or threatened election contest with
        respect to the election or removal of directors or other actual or
        threatened solicitation of proxies or consents by or on behalf of a
        person other than the Board.

                        (e) Notwithstanding the foregoing, a Termination Event
        shall not occur if, prior to the Termination Event, the Compensation
        Committee of the Board deems such an event to not be a Termination Event
        for the purposes of this Plan.

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

                                   ARTICLE III
                           ADMINISTRATION OF THE PLAN

                A Committee shall be appointed by the Board to administer the
Plan and establish, adopt, or revise such rules and regulations as the Committee
may deem necessary or advisable for the administration of the Plan and to
interpret the provisions of the Plan, and, except as otherwise indicated herein,
any such interpretations shall be conclusive and binding. All decisions of the
Committee shall be by vote of at least two of the Committee members and shall be
final.

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

                                   ARTICLE IV
                                  PARTICIPATION

                4.1 Election to Participate. An Eligible Employee may elect to
participate in the Plan and thereafter elect to defer annual Base Salary and/or
Bonus under the Plan for any Plan Year by filing a completed and fully executed
irrevocable Election Form prior to the beginning of such Plan Year or at such
other time as the Committee may permit. Election Forms

                                       5
<PAGE>   7

must be filed with the individual designated by the Committee to receive such
Election Forms, as indicated in the instructions set forth in the Election
Forms.

                Various deferral options will be made available to Eligible
Employees under the Plan, subject to such limitations and conditions as the
Committee may impose from time to time, in its complete and sole discretion.
Unless otherwise authorized by the Committee, a separate Election Form will be
required for each Plan Year, and the irrevocable Election Form will designate
the DCP Deferral Amounts as a fixed dollar amount (in increments of $1,000) of
Base Salary and/or (A) a fixed dollar amount (in increments of $1,000) or a
fixed percentage (in increments of 10%) of Bonus, or (B) 100% of any Bonus
exceeding a specified dollar amount, as elected by the Participant. Deferrals of
Base Salary will normally be deducted ratably during the Plan Year. In its sole
discretion, the Committee may also permit amounts which an Eligible Employee has
previously elected to defer under other plans or agreements with the Company to
be transferred to this Plan and credited to his Deferral Accounts which are
maintained hereunder.

                        (a) Minimum Deferral. For each Plan Year, the minimum
        amount of Base Salary that a Participant may elect to defer is five
        thousand U.S. dollars ($5,000) and the minimum amount of Bonus that a
        Participant may elect to defer is either: (i) five thousand U.S. dollars
        ($5000), or (ii) ten percent (10%) of Bonus.

                        (b) Maximum Deferral. For each Plan Year, the maximum
        amount of Base Salary that a Participant may elect to defer is
        seventy-five percent (75%) of Base Salary, and the maximum amount of
        Bonus that a Participant may elect to defer is one hundred percent
        (100%) of Bonus.

                4.2 DCP Deferral Accounts. The Committee shall establish and
maintain a separate DCP Deferral Account for each Participant. The amount
credited to a Participant's Deferral Account under the 1988 DCP as of December
31, 1998 shall remain credited to his DCP Deferral Account under this amended
and restated Plan as of January 1, 1999. A DCP Deferral Amount shall be credited
by the Company to the Participant's DCP Deferral Account no later than the first
day of the month following the month in which the Participant's Base Salary or
Bonus would otherwise have been paid. Such DCP Deferral Account shall be debited
by the amount of any payments made by the Company to the Participant or the
Participant's Beneficiary therefrom.

                4.3 SEDCP Deferral Accounts. The Committee shall establish and
maintain a separate SEDCP Deferral Account for each Participant who was a
participant in the SEDCP on December 31, 1998. The balance of such Participant's
accounts under the SEDCP as of December 31, 1998 shall remain credited to each
such Participant's SEDCP Deferral Account under this amended, restated and
merged Plan as of January 1, 1999. SEDCP Deferral Accounts shall be debited by
the amount of any payments made by the Company to the Participant or the
Participant's Beneficiary therefrom.

                4.4 Interest. Each Deferral Account of a Participant shall be
deemed to bear interest on the monthly balance of such Deferral Account at the
Declared Rate for each Plan Year, compounded monthly. Interest will be credited
to each Deferral Account on a monthly basis on the last day of each month as
long as any amount remains credited to such Deferral Account.

                                       6
<PAGE>   8

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

                4.6 Savings Plan Restoration Contribution. For each Plan Year,
the Company shall credit to the Savings Plan Restoration Account of any
Participant, an amount equal to the amount by which the contribution that would
otherwise have been made by the Company on behalf of the Participant to the
Savings Plan for such Plan Year is reduced by reason of the reduction in the
Participant's Base Salary for such Plan Year because of deferrals under this
Plan. The Savings Plan restoration contribution shall be credited to the Savings
Plan Restoration Account of each Participant for each Plan Year at the same time
as the Company contribution for such Plan Year is made to the Savings Plan. A
Participant's interest in any credit to his Savings Plan Restoration Account and
earnings thereon shall vest at the same rate and at the same time as would have
been the case had such contribution been made to the Savings Plan. Interest will
be credited on a Participant's Savings Plan Restoration Account at the same rate
and in the same manner as if it were a Deferral Account in accordance with
Section 4.4.

                Upon death, Disability, Retirement or other termination of
employment, the vested portion of the Participant's Savings Plan Restoration
Account shall be paid to the Participant (or his Beneficiary in the event of the
Participant's death) in a single lump sum within the first 90 days of the year
following the year in which the Participant terminates employment.

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

                                    ARTICLE V
                                    BENEFITS

                5.1 Retirement Benefit. Upon Retirement, the Company shall pay
to the Participant an annual payment for fifteen (15) years beginning in the
year following his Retirement, the sum of which payments (the "Retirement
Benefit") shall equal (A) plus (B) where (A) is the value of the Participant's
Deferral Accounts determined under Section 4.5 as of the end of the Plan Year in
which the Participant's Retirement occurs, and (B) is the interest that will
accrue on the unpaid balance in the Participant's Deferral Accounts during such
fifteen year (15) period pursuant to Section 4.4. For each Plan Year after the
initial Retirement Benefit payment is made, the annual Retirement Benefit
payment shall be redetermined based upon the value of the Participant's Deferral
Accounts at that time, plus the interest that will accrue pursuant to Section
4.4 for the remaining period of annual payments. A Participant may instead

                                       7
<PAGE>   9

elect in his Distribution Election Form to have the Retirement Benefit paid to
him in annual payments for either five (5), ten (10) or twenty (20) years or in
a single lump sum payment. The amount of any such annual payments shall be
calculated in accordance with the principles stated in the preceding sentences.
Annual payments will be made within the first 90 days of the year.

                The Committee, in its sole discretion, may permit a Participant
to change his election as to the form of payment upon written petition of the
Participant. In order to be effective, a Participant's election (or modification
or revocation of a prior election) of the form of payment of his Retirement
Benefit must be made not later than twelve (12) months before the Participant's
Retirement, unless otherwise permitted by the Committee. Subject to the
foregoing limitations, a Participant may make such election (or revoke a prior
election and make a new election) at any time. Any election (or modification or
revocation of a prior election) which is made later than twelve (12) months
prior to the Participant's Retirement will be considered void and shall have no
force or effect, except as otherwise determined by the Committee.

                5.2 Termination Benefit. If a Participant's employment with the
Company terminates for any reason other than Retirement, Disability or death,
then, except as provided in section 5.6 for Early Payment Benefits, the Company
shall pay to the Participant in a single lump sum within the first ninety (90)
days of the calendar year following the Participant's termination of employment,
an amount (the "Termination Benefit") equal to the value of the Participant's
Deferral Accounts as of the end of the calendar year in which the Participant's
termination of employment occurs; provided, however, at the sole discretion of
the Committee, no lump sum shall be payable and instead, the Company shall pay
to the Participant an annual amount each year for a period not to exceed three
(3) years beginning in the year following the date of termination of employment,
the sum of which payments shall equal (A) plus (B) where (A) is the value of the
Participant's Deferral Accounts determined under Section 4.5 as of the end of
the Plan Year in which the Participant terminates employment, and (B) is the
interest that will accrue on the unpaid balance in such Deferral Accounts
pursuant to Section 4.4 during the one to three (1-3) year payment period.
Annual payments will be made within the first 90 days of the year. Spousal
survivor benefits (if any) under Section 5.5 of the Plan shall not be payable to
the spouse of a Participant who receives benefits under this Section 5.2.
Notwithstanding the foregoing, effective January 1, 2001, Participants who
qualify for retiree medical coverage under the Occidental Petroleum Corporation
Medical Plan on the date of their termination of employment with the Company for
reasons other than Disability or death prior to attainment of age 55 shall
receive benefits pursuant to Section 5.1 upon Retirement and this Section 5.2
shall not be applicable to such Participants.

                5.3 Disability. If a Participant's employment with the Company
terminates prior to Retirement due to a Disability, then, except as provided in
Section 5.6 for Early Payment Benefits, the Company shall pay to the Participant
in a single lump sum within the first ninety (90) days of the calendar year
following the Participant's termination of employment, an amount equal to the
value of the Participant's Deferral Accounts as of the date of the Participant's
termination of employment. Spousal survivor benefits (if any) under Section 5.5
of the Plan shall not be payable to the spouse of a Participant who receives
benefits under this Section 5.3.

                                       8
<PAGE>   10

                5.4 Survivor Benefits.

                        (a) If a Participant dies while employed by the Company
        prior to becoming eligible for Retirement, the Company shall pay to the
        Participant's Beneficiary in a single lump sum, except as provided in
        Section 5.6 for Early Payment Benefits, an amount equal to the value of
        the Participant's DCP Deferral Account as of the date of the
        Participant's death. The Company will make such payment within the first
        ninety (90) days of the calendar year following the Participant's death.
        If such Participant also has an SEDCP Deferral Account, the Company will
        pay to the Participant's Beneficiary annual payments over the greater
        of: (i) ten (10) years, or (ii) until the Participant would have
        attained age 65, the sum of which payments shall equal the greater of:
        (i) (A) plus (B) where (A) is the value of the Participant's SEDCP
        Deferral Account as of the date of the Participant's death, and (B) is
        the interest that will accrue on the unpaid balance in such SEDCP
        Deferral Account during the payment period at the rate of eight percent
        (8%) per annum, compounded annually, or (ii) twenty five percent (25%)
        of the amount deferred under the SEDCP (excluding any interest on such
        deferrals) multiplied by the number of annual payments to be made with
        respect to SEDCP Deferral Accounts in accordance with the first clause
        of this sentence.

                        (b) If a Participant dies while employed by the Company
        after becoming eligible for Retirement, the Company will pay to the
        Participant's Beneficiary the Retirement Benefit that would have been
        payable to the Participant over the payment period elected by the
        Participant. Payments will commence in the year following the year of
        the Participant's death.

                        (c) If a Participant dies after the commencement of
        payment of his Retirement Benefit, the Company will pay to the
        Participant's Beneficiary the remaining installments of the Retirement
        Benefit that would have been payable to the Participant for the balance
        of the payment period elected by the Participant.

                5.5 Spousal Survivor Benefits with Respect to SEDCP Deferral
Accounts. If a Participant who has an SEDCP Deferral Account dies after becoming
eligible for Retirement or after commencement of payment of his Retirement
Benefit and a spouse to whom he had been married to for at least one (1) year
prior to his death survives beyond completion of payment of the Participant's
SEDCP Deferral Account balance, the Company shall pay such spouse a lump sum
payment in an amount equal to ten percent (10%) of the Participant's SEDCP
Deferral Account balance valued as of the earlier of the date of the
Participant's Retirement or death. Such lump sum spousal survivor benefit shall
be paid as soon as administratively practicable following the later of the
completion of payment of the Participant's SEDCP Deferral Account balance or the
Participant's death. No benefit shall be payable under this Section 5.5 if the
Participant's spouse does not survive beyond completion of payment of the
Participant's SEDCP Deferral Account balance. Notwithstanding the foregoing, no
spousal survivor benefit shall be payable to the spouse of any Participant who
received benefits pursuant to Section 5.2 (Termination Benefit), Section 5.3
(Disability), Section 5.7 (Emergency Benefit), Section 5.8 (Immediate Payment on
Termination Event), or Section 5.10 (Lump Sum Payment With Penalty).

                                       9
<PAGE>   11

                5.6 Early Payment. A Participant may elect, in such manner as
the Committee may permit in any Distribution Election Form, to receive part or
all of the DCP Deferral Amounts covered by such Distribution Election Form in a
lump sum payment or in annual installments over one to five (1-5) years ("Early
Payment Benefit") commencing on a date prior to Retirement designated in such
Distribution Election Form ("Early Payment Date").

                The Early Payment Date on any Distribution Election Form may be
any date which is at least two (2) years after completion of deferral of the DCP
Deferral Amounts covered by such Distribution Election Form. If the Participant
terminates employment with the Company for any reason prior to commencement or
completion of all Early Payment Benefits, all such elections made by the
Participant to receive Early Payment Benefits shall continue in force. However,
any such Early Payments Benefits which have not yet commenced shall commence in
the year following the Participant's termination of employment. Annual payments
will be made within the first 90 days of the year.

                5.7 Emergency Benefit. In the event that the Committee, upon
written petition of the Participant (or his Beneficiary, in the event of the
Participant's death), determines in its sole discretion, that the Participant or
Beneficiary has suffered an unforeseeable financial emergency, the Company shall
pay to the Participant, as soon as practicable following such determination, an
amount up to the balance of the Participant's Deferral Accounts which is
necessary to meet the emergency ("Emergency Benefit"). For purposes of this
Plan, an unforeseeable financial emergency is an unexpected need for cash
arising from an illness, casualty loss, divorce, sudden financial reversal, or
other such unforeseeable occurrence. Cash needs arising from foreseeable events
such as the purchase of a home or education expenses for children shall normally
not be considered to be the result of an unforeseeable financial emergency.
Spousal survivor benefits (if any) under Section 5.5 of the Plan shall not be
payable to the spouse of a Participant who receives an Emergency Benefit under
this Section 5.7.

                5.8 Immediate Payment on Termination Event. Upon petition of a
Participant within sixty (60) days after any Termination Event or such other
period as the Committee may permit, the Committee, in its sole discretion, may
direct the Company to pay the balance of the Participant's Deferral Accounts to
him immediately in a lump sum as a Termination Benefit pursuant to Section 5.2,
irrespective of whether the Participant terminates or continues employment with
the Company. Spousal survivor benefits (if any) under Section 5.5 of the Plan
shall not be payable to the spouse of a Participant who receives benefits under
this Section 5.8.

                5.9 Small Benefit. In the event that the Committee determines,
in its sole discretion, that the amount of any benefit is too small to make it
administratively convenient to pay such benefit over time, the Company may pay
the benefit in a lump sum.

                5.10 Lump Sum Payment With Penalty. Notwithstanding any other
provisions of the Plan, in lieu of payments in accordance with the form
previously elected by the Participant, a Participant (or his Beneficiary, in the
event of the Participant's death) may elect at any time to receive an immediate
lump sum payment of all or part of the vested balance of the Participant's
Deferral Accounts, reduced by a penalty, which shall be forfeited to the
Company, equal to ten percent (10%) of the amount withdrawn from the
Participant's Deferral Accounts.

                                       10
<PAGE>   12

                Whenever a Participant receives a lump sum payment under this
Section 5.10, the Participant will be deemed to have revoked all current
deferral elections under the Plan effective as of the date of the lump sum
payment. The Participant will not be permitted to participate in the next
enrollment period under the Plan and will be precluded from electing to make new
deferrals under the Plan for a minimum period of one (1) year (or such lesser
period as the Committee may permit) following receipt of the lump sum payment.
Spousal survivor benefits (if any) under Section 5.5 of the Plan shall not be
payable to the spouse of a Participant who receives a lump sum payment under
this Section 5.10.

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

                5.12 Termination of Employment. For the purpose of this Article
V, a Participant will be deemed to have terminated employment if the Participant
ceases to be an employee of any of the following:

                        (a) the Company;

                        (b) an Affiliate; or

                        (c) any other entity, whether or not incorporated, in
        which the Company has an ownership interest, and the Committee has
        designated that the Participant's commencement of employment with such
        entity upon Participant's ceasing to be an employee of an entity
        described in (a) or (b) above will not be deemed to be a termination of
        employment for purposes of this Plan, provided that such designation
        shall be made in writing by the Committee and shall be communicated to
        the Participant prior to his commencement of employment with the entity
        so designated.

                For the purposes of the preceding provisions, a Participant who
ceases to be an employee of an entity described in (a), (b) or (c) above shall
not be deemed to have terminated employment if such cessation of employment is
followed immediately by his commencement of employment with another entity
described in (a), (b) or (c) above.

                                   ARTICLE VI
                             BENEFICIARY DESIGNATION

                Each Participant shall have the right, at any time, to designate
any person or persons as the Beneficiary to whom payments under this Plan shall
be made in the event of the Participant's death prior to complete distribution
to the Participant of the benefits due under the Plan. Each Beneficiary
designation shall become effective only when filed in writing with the Committee
during the Participant's lifetime on a form prescribed by the Committee. The
filing of a new Beneficiary designation form will cancel any inconsistent
Beneficiary designation previously filed.

                If a Participant fails to designate a Beneficiary as provided
above, or if all designated Beneficiaries predecease the Participant or die
prior to complete distribution of the

                                       11
<PAGE>   13

Participant's benefits, such benefits shall be paid in accordance with the
Participant's Beneficiary designation under the Company's Retirement Plan, and
if there is no such valid Beneficiary designation, to the Participant's then
surviving spouse, or if none, to the Participant's estate, unless directed
otherwise by the court that has jurisdiction over the assets belonging to the
Participant's probate estate.

                                   ARTICLE VII
                                CLAIMS PROCEDURE

                All applications for benefits under the Plan shall be submitted
to: Occidental Petroleum Corporation, Attention: Pension and Retirement Plan
Administrative Committee, 10889 Wilshire Blvd., Los Angeles, CA 90024.
Applications for benefits must be in writing on the forms prescribed by the
Committee and must be signed by the Participant, or in the case of a death
benefit, by the Beneficiary or legal representative of the deceased Participant.
Each application shall be acted upon and approved or disapproved within 60 days
following its receipt by the Committee. If any application for a benefit is
denied, in whole or in part, the Committee shall notify the applicant in writing
of such denial and of his right to a review by the Committee and shall set forth
in a manner calculated to be understood by the applicant, specified reasons for
such denial, specific references to pertinent Plan provisions on which the
denial is based, a description of any additional material or information
necessary for the applicant to perfect his application, an explanation of why
such material or information is necessary, and an explanation of the Plan's
review procedure.

                Any person, or his duly authorized representative, whose
application for benefits is denied in whole or in part, may appeal such denial
to the Committee for a review of the decision by submitting to the Committee
within 60 days after receiving notice of the denial, a written statement:

                        (a) requesting a review of his application for benefits
        by the Committee;

                        (b) setting forth all of the grounds upon which his
        request for review is based and any facts in support thereof; and

                        (c) setting forth any issues or comments which the
        applicant deems relevant to his application.

                The Committee shall act upon each such application within 60
days after the later of receipt of the applicant's request for review by the
Committee or receipt of any additional materials reasonably requested by the
Committee from such applicant.

                The Committee shall make a full and fair review of each such
application and any written materials submitted by the applicant or the Company
in connection therewith, and may require the Company or the applicant to submit
within 30 days of written notice by the Committee, such additional facts,
documents, or other evidence as the Committee, in its sole discretion, deems
necessary or advisable in making such a review. On the basis of its review, the
Committee shall make an independent determination of the applicant's eligibility
for benefits

                                       12
<PAGE>   14

under the Plan. The decision of the Committee on any application for benefits
shall be final and conclusive upon all persons if supported by substantial
evidence in the record.

                If the Committee denies an application in whole or in part, the
Committee shall give written notice of its decision to the applicant setting
forth in a manner calculated to be understood by the applicant, the specific
reasons for such denial and specific references to the pertinent Plan provisions
on which the Committee's decision was based.

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

                                  ARTICLE VIII
                        AMENDMENT AND TERMINATION OF PLAN

                8.1 Amendment. The Board may amend the Plan in whole or in part
at any time for any reason, including but not limited to, tax, accounting or
other changes, which may result in termination of the Plan for future deferrals.
The Committee, in its discretion, may amend the Plan if the Committee determines
that such amendment does not significantly increase or decrease Plan benefits or
costs. Notwithstanding the foregoing, no amendment shall: (a) reduce the amounts
that have been credited to the Deferral Account(s) or Savings Plan Restoration
Account of any Participant prior to the date such amendment is adopted, (b)
eliminate the spousal survivor benefit under Section 5.5, or (c) change the
definition of the Declared Rate set forth in Article II to a rate or to a
formula that, as of the last day of the month preceding the date such amendment
is adopted, produces a rate that is less than the lesser of: (i) Moodys Plus
Three (as defined in Article II and calculated as of the last day of the month
preceding the date such amendment is adopted), or (ii) the highest yield on any
unsecured debt or preferred stock of the Company that was outstanding on the
last day of the month immediately preceding the date such amendment is adopted.
Any amendment that would either (i) reduce the Declared Rate to a rate or to a
formula that, as of the last day of the month preceding the date such amendment
is adopted, produces a rate that is less than Moodys Plus Three (as defined in
Article II and calculated as of the last day of the month preceding the date
such amendment is adopted), or (ii) change the terms of the amendment provisions
of this Section 8.1 or the terms of the termination provisions of Section 8.2,
shall not be effective prior to the date that is two years after the date such
amendment is adopted, unless the amendment is required by a change in the tax or
other applicable laws or accounting rules. Notwithstanding the foregoing,
following a Termination Event, no amendment shall: (a) reduce the amounts that
have been credited to the Deferral Account(s) or Savings Plan Restoration
Account of any Participant prior to the date such amendment is adopted, (b)
eliminate the spousal survivor benefit under Section 5.5, (c) change the
definition of the Declared Rate set forth in Article II to a rate or to a
formula that, as of the last day of the month preceding the date of the
Termination Event, produces a rate that is less than Moodys Plus Three (as
defined in Article II and calculated as of the last day of the month preceding
the date of the Termination Event), or (d) change the terms of the amendment
provisions of this Section 8.1 or the terms of the termination provisions of
Section 8.2.

                                       13
<PAGE>   15

                8.2 Termination.

                        (a) Company's Right to Terminate. The Board may
        terminate the Plan at any time, if in the Board's judgment, the
        continuance of the Plan would not be in the Company's best interest due
        to tax, accounting or other effects thereof, or potential payouts
        thereunder, provided that any termination of the Plan shall not be
        effective prior to the date that is two years after the date the Board
        adopts a resolution to terminate the Plan, unless the termination of the
        Plan is required by a change in the tax or other applicable laws or
        accounting rules. Notwithstanding the foregoing, following a Termination
        Event, the Plan may not be terminated prior to the date that is three
        years after the date the Termination Event occurs. In the event the
        Board adopts a resolution terminating the Plan, the Board or the
        Committee shall determine the date as of which all deferral elections
        shall cease to apply so that no further Base Salary or Bonus shall be
        deferred under the Plan.

                        (b) Payments Upon Termination. Upon any termination of
        the Plan under this Section 8.2, the Board or Committee shall determine
        the date or dates of Plan distributions to the Participants, which date
        or dates shall not be later than the date or dates on which the
        Participants or their Beneficiaries would otherwise receive benefits
        hereunder.

                                   ARTICLE IX
                                  MISCELLANEOUS

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

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

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

                                       14
<PAGE>   16

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

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

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

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

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

                9.9 Applicable Law. The Plan shall be governed by and construed
in accordance with the laws of the State of California to the extent such laws
are not preempted by the Employee Retirement Income Security Act of 1974, as
amended.

                                       15
<PAGE>   17

                IN WITNESS WHEREOF, the Company has executed this document this
___ day of _______________, 2001.

                                            OCCIDENTAL PETROLEUM CORPORATION

                                            By
                                               ---------------------------------
                                               Richard W. Hallock
                                               Executive Vice-President, Human
                                               Resources

                                       16

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