EXHIBIT 10.6
OCCIDENTAL PETROLEUM
CORPORATION
2005 LONG-TERM INCENTIVE
PLAN
LONG-TERM INCENTIVE
AWARD
TERMS AND
CONDITIONS
(Equity-based, Cash-settled
Award)
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DATE OF GRANT:
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July 15, 2009
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LONG-TERM INCENTIVE UNITS:
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See “Grants & Awards”
Tab
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VESTING DATE:
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July 14, 2012
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The following Terms and
Conditions (these “Terms and Conditions”) are set
forth as of the Date of Grant between OCCIDENTAL PETROLEUM
CORPORATION, a Delaware corporation (“Occidental” and,
with its subsidiaries, the “Company”), and the Eligible
Employee receiving this award (the
“Grantee”).
1. GRANT OF LONG-TERM
INCENTIVE AWARD. In accordance with these Terms and Conditions
and the Occidental Petroleum Corporation 2005 Long-Term Incentive
Plan, as the same may be amended from time to time (the
“Plan”), Occidental grants to the Grantee as of the
Date of Grant, the number of Long-Term Incentive Units (“LTI
Units”) indicated in the on-line system established and
maintained by the Company or another third party designated by the
Company, subject to adjustment under the Plan and Section 6 of
these Terms and Conditions. An LTI Unit represents the right to
receive in cash, upon vesting, as set forth in Section 3, the
Long-Term Incentive Value of one share of Occidental Common Stock,
$0.20 par value (the “Common Stock”). LTI Units are not
Common Stock and have no voting rights or, except as stated in
Section 5, dividend rights. “Long-Term Incentive Value”
means the last reported sale price of a share of Common Stock on
the New York Stock Exchange Composite Transactions on the Vesting
Date, date of death or Change in Control event.
2. RESTRICTIONS ON
TRANSFER. Neither these Terms and Conditions nor any right to
receive cash pursuant to these Terms and Conditions may be
transferred or assigned by the Grantee other than (i) to a
beneficiary designated on a form approved by the Company (if
enforceable under local law), by will or, if the Grantee dies
without designating a beneficiary of a valid will, by the laws of
descent and distribution, or (ii) pursuant to a domestic relations
order, if applicable, (if approved or ratified by the
Committee).
3. VESTING AND
FORFEITURE OF LONG-TERM INCENTIVE AWARD. (a) If the Grantee
fails to accept this award prior to the next record date for the
payment of dividends on the Common Stock subsequent to the Date of
Grant, then, notwithstanding any other provision of this award, the
Grantee shall forfeit all rights under this award and this award
will become null and void. For purposes of this section, acceptance
of the award shall occur on the date the Grantee accepts this
Long-Term Incentive Award through the on-line system designated by
the Company.
(b) The Grantee must remain in the
continuous employ of the Company through the Vesting Date to
receive payment of this award. The continuous employment of the
Grantee will not be deemed to have been interrupted by reason of
the transfer of the Grantee’s employment among the Company
and its affiliates or an approved leave of absence. However, if,
prior to the Vesting Date, the Grantee becomes permanently disabled
while in the employ of the Company and terminates employment as a
result thereof, retires with the consent of the Company, or
terminates employment for the convenience of the Company (each of
the foregoing, a
“Forfeiture Event”),
then the number of LTI Units will be reduced on a pro rata basis
based upon the number of days remaining until the Vesting Date
following the date of the Forfeiture Event. If the Grantee
terminates employment voluntarily or is terminated for cause before
the Vesting Date, then these Terms and Conditions will terminate
automatically on the date of the Grantee’s termination and
the Grantee shall forfeit the right to receive any LTI Units. If
the Grantee dies while in the employ of the Company before the
Vesting Date, all of the LTI Units will vest as of the date of
death and become immediately payable.
(c) If a Change in Control event
occurs prior to the Vesting Date, the LTI Units shall immediately
vest and become nonforfeitable unless, prior to the occurrence of
the Change in Control event, the Committee, as provided in Section
7.1 of the Plan, determines that such event will not accelerate
vesting of the LTI Units. Any such determination by the Committee
is binding on the Grantee.
4. PAYMENT OF
AWARDS. Payment of the Long-Term Incentive Value for each LTI
Unit, as adjusted pursuant to Sections 3 and 6 of these Terms and
Conditions, will be settled in cash only. Payment will be made to
the Grantee as promptly as practicable after the Vesting Date, date
of death or the Change in Control event, as the case may
be.
5. CREDITING AND
PAYMENT OF DIVIDEND EQUIVALENTS . With respect to the number of
LTI Units indicated above, the Grantee will be credited on the
books and records of Occidental with an amount (the "Dividend
Equivalent") equal to the amount per share of any cash dividends
declared by the Board on the outstanding Common Stock as and when
declared with a record date during the period beginning on the Date
of Grant and ending on the Vesting Date, or, if earlier, the date
on which the Grantee forfeits the right to receive the LTI Units.
Occidental will pay in cash to the Grantee an amount equal to the
Dividend Equivalents credited to such Grantee as promptly as may be
practicable after the Grantee has been credited with a Dividend
Equivalent.
6. ADJUSTMENTS .
The number of LTI Units covered by this Grant may be adjusted as
the Committee determines, pursuant to Section 7.2 of the Plan, in
order to prevent dilution or expansion of the Grantee’s
rights under these Terms and Conditions as a result of events such
as stock dividends, stock splits, or other change in the capital
structure of Occidental, or any merger, consolidation, spin-off,
liquidation or other corporate transaction or event having a
similar effect. If any such adjustment occurs, the Company will
give the Grantee written notice of the adjustment containing an
explanation of the nature of the adjustment.
7. NO EMPLOYMENT
CONTRACT. Nothing in these Terms and Conditions confers upon
the Grantee any right with respect to continued employment by the
Company, nor limits in any manner the right of the Company to
terminate the employment or adjust the compensation of the Grantee.
Unless otherwise agreed in a writing signed by the Grantee and an
authorized representative of the Company, the Grantee’s
employment with the Company is at will and may be terminated at any
time by the Grantee or the Company.
8. TAXES AND
WITHHOLDING. Regardless of any action the Company takes with
respect to any or all income tax (including U.S. federal, state and
local tax and non-U.S. tax), social insurance, payroll tax, payment
on account or other tax-related items related to the
Grantee’s participation in the Plan and legally applicable to
the Grantee (“Tax-Related Items”), the Grantee
acknowledges that the ultimate liability for all Tax-Related Items
is and remains the Grantee’s responsibility and may exceed
the amount actually withheld by the Company. The Grantee further
acknowledges that the Company (i) makes no representations or
undertakings regarding the treatment of any Tax-Related Items in
connection with any aspect of this Long-Term
2
Incentive Award, including the grant
or vesting of the Long-Term Incentive Award and the receipt of
Dividend Equivalents; and (ii) does not commit to and is under no
obligation to structure the terms of the grant or any aspect of the
Long-Term Incentive Award to reduce or eliminate the
Grantee’s liability for Tax-Related Items or achieve any
particular tax result. Further, if the Grantee has become subject
to tax in more than one jurisdiction between the Date of Grant and
the date of any relevant taxable event, the Grantee acknowledges
that the Company may be required to withhold or account for
Tax-Related Items in more than one jurisdiction.
Prior to the relevant taxable event,
the Grantee shall pay or make adequate arrangements satisfactory to
the Company to satisfy all Tax-Related Items. In this regard, the
Grantee authorizes the Company to withhold all applicable
Tax-Related Items legally payable by the Grantee first from the
cash payable pursuant to this Long-Term Incentive Award (including
Dividend Equivalents) and, if not sufficient, from the
Grantee’s wages or other cash compensation. The Grantee shall
pay to the Company any amount of Tax-Related Items that the Company
may be required to withhold as a result of the Grantee’s
receipt of this Long-Term Incentive Award that cannot be satisfied
by the means previously described.
9. COMPLIANCE WITH
LAW. The Company will make reasonable efforts to comply with
all federal, state and non-U.S. laws applicable to awards of this
type. However, if it is not feasible for the Company to comply with
these laws with respect to the grant or settlement of these awards,
then the awards may be cancelled without any compensation or
additional benefits provided to Grantee as a result of the
cancellation.
10. RELATION TO OTHER
BENEFITS. The benefits received by the Grantee under these
Terms and Conditions will not be taken into account in determining
any benefits to which the Grantee may be entitled under any profit
sharing, retirement or other benefit or compensation plan
maintained by the Company, including the amount of any life
insurance coverage available to any beneficiary of the Grantee
under any life insurance plan covering employees of the Company.
Additionally, this Long-Term Incentive Award is not part of normal
or expected compensation or salary for any purposes, including, but
not limited to calculation of any severance, resignation,
termination, redundancy, end of service payments, bonuses or
long-service awards. The grant of this Long-Term Incentive Award
does not create any contractual or other right to receive future
grants of Long-Term Incentive Awards or benefits in lieu of
Long
