EXHIBIT 10.17
AMENDMENT NUMBER 1
TO THE
OCCIDENTAL PETROLEUM CORPORATION
DEFERRED COMPENSATION PLAN
WHEREAS, Occidental Petroleum Corporation (the "Company") maintains
the Occidental Petroleum Corporation Deferred Compensation Plan (the "DCP"), the
purpose of which is to provide a tax-deferred opportunity for key management and
highly compensated employees of the Company and its affiliates to accumulate
additional retirement income through deferrals of compensation;
WHEREAS, the American Jobs Creation Act of 2004 added a new Section
409A to the Internal Revenue Code establishing new rules regarding the taxation
of nonqualified deferred compensation plans, effective for amounts deferred
after December 31, 2004 (the "New Law");
WHEREAS, under the New Law, amounts deferred on and after January 1,
2005 under the DCP would be immediately taxable to participants;
WHEREAS, the Board of Directors of the Company (the "Board") adopted,
effective January 1, 2005, the Occidental Petroleum Corporation 2005 Deferred
Compensation Plan (the "2005 DCP") to enable the Company to continue to provide
a tax deferred opportunity for key management and highly compensated employees
of the Company and its affiliates to accumulate additional retirement income;
WHEREAS, recent guidance issued by the Internal Revenue Service
specifies that bonuses earned by DCP participants in 2004 that become payable in
2005 will, if subject to a deferral election, be treated as amounts deferred
after December 31, 2004 for purposes of the New Law;
WHEREAS, it is desirable to preserve a deferral of taxes on 2004
bonuses subject to deferral elections;
WHEREAS, it is therefore desirable (1) to amend the DCP to reflect the
cessation of further deferrals thereunder after 2004, and (2) to redirect the
deferral of 2004 deferred bonuses to the 2005 DCP; and
WHEREAS, it is also desirable to amend the DCP to update its claims
procedures.
NOW, THEREFORE, effective as of January 1, 2005, except as otherwise
provided, the DCP is hereby amended as follows:
ARTICLE IV
PARTICIPATION
1. Effective as of January 1, 2005, Article IV is amended by adding to
the following new Section 4.8 to the end thereof:
"4.8 Cessation of Compensation Deferrals. Notwithstanding any other
Plan provision to the contrary, no amount of Compensation earned for
services performed in Plan Years beginning after December 31, 2004 shall be
deferred under this Plan, and no Savings Plan Restoration Contributions
shall be credited under this Plan with respect to Plan Years beginning
after December 31, 2004. Accordingly, any election to defer Compensation
under this Plan shall terminate as to future earnings as of December 31,
2004 and shall no longer have any force or effect as to future earnings.
Bonuses that were earned in 2004 and subject to deferral elections under
the terms of this Plan shall not be credited under this Plan, but shall be
(1) credited under the Occidental Petroleum Corporation 2005 Deferred
Compensation Plan in accordance with its terms and shall be subject to the
terms and conditions of such plan, including, without limitation, its
distribution provisions or (2) , if elected by the Participant, paid in
cash to the Participant in 2005. No new deferral elections shall be made
under Article IV of this Plan with respect to Compensation earned after
December 31, 2004. Interest shall continue to be credited to each
Participant's Deferral Accounts as provided in Section 4.4."
ARTICLE VII
CLAIMS PROCEDURES
2. Effective as of January 1, 2004, Article VII is amended in its
entirely to read as follows:
"7.1 Applications for Benefits. All applications for benefits under
the Plan shall be submitted to: Occidental Petroleum Corporation,
Attention: Deferred Compensation Plan Committee, 10889 Wilshire Blvd., Los
Angeles, CA 90024. Applications for benefits must be in writing on the
forms prescribed by the Committee and must be signed by the Participant, or
in the case of a Beneficiary Benefit, by the Beneficiary or legal
representative of the deceased Participant.
7.2 Claims Procedure for Benefits other than Disability Benefits.
(a) Within a reasonable period of time, but not later than 90 days
after receipt of a claim for benefits (other than Disability benefits), the
Committee or its delegate shall notify the claimant of any adverse benefit
determination on the claim, unless special circumstances require an
extension of time for processing the claim. In no event may the extension
period exceed 90 days from the end of the initial 90-day period. If an
extension is necessary, the Committee or its delegate shall provide the
claimant with a written notice to this effect prior to the expiration of
the initial 90-day period. The notice
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shall describe the special circumstances requiring the extension and the
date by which the Committee or its delegate expects to render a
determination on the claim.
(b) In the case of an adverse benefit determination, the Committee or
its delegate shall provide to the claimant written or electronic
notification setting forth in a manner calculated to be understood by the
claimant: (i) the specific reason or reasons for the adverse benefit
determination; (ii) reference to the specific Plan provisions on which the
adverse benefit determination is based; (iii) a description of any
additional material or information necessary for the claimant to perfect
the claim and an explanation of why the material or information is
necessary; and (iv) a description of the Plan's claim review procedures and
the time limits applicable to such procedures, including a statement of the
claimant's right to bring a civil action under Section 502(a) of ERISA
following an adverse final benefit determination on review and in
accordance with Section 7.4.
(c) Within 60 days after receipt by the claimant of notification of
the adverse benefit determination, the claimant or his duly authorized
representative, upon written application to the Committee, may request that
the Committee fully and fairly review the adverse benefit determination. On
review of an adverse benefit determination, upon request and free of
charge, the claimant shall have reasonable access to, and copies of, all
documents, records and other information relevant to the claimant's claim
for benefits. The claimant shall have the opportunity to submit written
comments, documents, records, and other information relating to the claim
for benefits. The Committee's (or delegate's) review shall take into
account all comments, documents, records, and other information submitted
regardless of whether the information was previously considered in the
initial adverse benefit determination.
(d) Within a reasonable period of time, but not later than 60 days
after receipt of such request for review, the Committee or its delegate
shall notify the claimant of any final benefit determination on the claim,
unless special circumstances require an extension of time for processing
the claim. In no event may the extension period exceed 60 days from the end
of the initial 60-day period. If an extension is necessary, the Committee
or its delegate shall provide the claimant with a written notice to this
effect prior to the expiration of the initial 60-day period. The notice
shall describe the special circumstances requiring the extension and the
date by which the Committee or its delegate expects to render a final
determination on the request for review. In the case of an adverse final
benefit determination, the Committee or its delegate shall provide to the
claimant written or electronic notification setting forth in a manner
calculated to be understood by the claimant: (i) the specific reason or
reasons for the adverse final benefit determination; (ii) reference to the
specific Plan provisions on which the adverse final benefit determination
is based; (iii) a statement that the claimant is entitled to receive, upon
request and free of charge, reasonable access to, and copies of, all
documents, records and other information relevant to the claimant's claim
for benefits; and (iv) a statement of the claimant's right to bring a civil
action under Section 502(a) of ERISA following an adverse final benefit
determination on review and in accordance with Section 7.4.
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7.3 Claims Procedure for Disability Benefits.
(a) Within a reasonable period of time, but not later than 45 days
after receipt of a claim for Disability benefits, the Committee or its
delegate shall notify the claimant of any adverse benefit determination on
the claim, unless circumstances beyond the Plan's control require an
extension of time for processing the claim. In no event may the extension
period exceed 30 days from the end of the initial 45-day period. If an
extension is necessary, the Committee or its delegate shall provide the
claimant with a written notice to this effect prior to the expiration of
the initial 45-day period. The notice shall describe the circumstances
requiring the extension and the date by which the Committee or its delegate
expects to render a determination on the claim. If, prior to the end of the
first 30-day extension period, the Committee or its delegate determines
that, due to circumstances beyond the control of the Plan, a decision
cannot be rendered within that extension period, the period for making the
determination may be extended for an additional 30 days, so long as the
Committee or its delegate notifies the claimant, prior to the expiration of
the first 30-day extension period, of the circumstances requiring the
extension and the date as of which the Committee or its delegate expects to
render a decision. This notice of extension shall specifically describe the
standards on which entitlement to a benefit is based, the unresolved issues
that prevent a decision on the claim, and the additional information needed
to resolve those issues, and that the claimant has at least 45 days within
which to provide the specified information.
(b) In the case of an adverse benefit determination, the Committee or
its delegate shall provide to the claimant written or electronic
notification setting forth in a manner calculated to be understood by the
claimant: (i) the specific reason or reasons for the adverse benefit
determination; (ii) reference to the specific Plan provisions on which the
adverse benefit determination is based; (iii) a description of any
additional material or information necessary for the claimant to perfect
the claim and an explanation of why the material or information is
necessary; (iv) a description of the Plan's claim review procedures and the
time limits applicable to such procedures, including a statement of the
claimant's right to bring a civil action under Section 502(a) of ERISA
following an adverse final benefit determination on review and in
accordance with Section 7.4; (v) if an internal rule, guideline, protocol
or similar criterion ("internal standard") was relied upon in making the
determination, a copy of the internal standard or a statement that the
internal standard was relied upon and that a copy of the internal standard
shall be provided to the claimant free of charge upon request; and (vi) if
the determination is based on a medical necessity or experimental treatment
or similar exclusion or limit, an explanation of the scientific or clinical
judgment for the determination or a statement that such explanation shall
be provided free of charge upon request.
(c) Within 180 days after receipt by the claimant of notification of
the adverse benefit determination, the claimant or his duly authorized
representative, upon written application to the Committee, may request that
the Committee fully and fairly review the adverse benefit determination. On
review of an adverse benefit determination, upon request and free of
charge, the claimant shall have reasonable access to, and copies of, all
documents, records and other information relevant to the claimant's claim
for benefits. The claimant shall have the opportunity to submit written
comments, documents, records,
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and other information relating to the claim for benefits. The Committee's
(or delegate's) review: (i) shall take into account all comments,
documents, records, and other information submitted regardless of whether
the information was previously considered in the initial adverse benefit
determination; (ii) shall not afford deference to the initial adverse
benefit determination; (iii) shall be conducted by an appropriate named
fiduciary of the Plan who is neither an individual who made the initial
adverse benefit determination nor a subordinate of such individual; (iv)
shall identify medical and vocational experts whose advice was obtained on
behalf of the Plan in connection with the initial adverse benefit
determination; and (v) if the adverse benefit determination was based in
whole or in part on a medical judgment, shall consult an appropriate health
care professional who has appropriate training and experience in the
relevant field of medicine and who or whose subordinate was not consulted
in the initial adverse benefit determination.
(d) Within a reasonable period of time, but not later than 45 days
after receipt of such request for review, the Committee or its delegate
shall notify the claimant of any final benefit determination on the claim,
unless special circumstances require an extension of time for processing
the claim. In no event may the extension period exceed 45 days from the end
of the initial 45-day period. If an extension is necessary, the Committee
or its delegate shall provide the claimant with a written notice to this
effect prior to the expiration of the initial 45-day period. The notice
shall describe the special circumstances requiring the extension and the
date by which the Committee or its delegate expects to render a final
determination on the request for review. In the case of an adverse final
benefit determination, the Committee or its delegate shall provide to the
claimant written or electronic notification setting forth in a manner
calculated to be understood by the claimant: (i) the specific reason or
reasons for the adverse final benefit determination; (ii) reference to the
specific Plan provisions on which the adverse final benefit determination
is based; (iii) a statement that the claimant is entitled to receive, upon
request and free of charge, reasonable access to, and copies of, all
documents, records and other information relevant to the claimant's claim
for benefits; (iv) a statement of the claimant's right to bring a civil
action under Section 502(a) of ERISA following an adverse final benefit
determination on review and in accordance with Section 7.4; (v) if an
internal standard was relied upon in making the determination, a copy of
the internal standard or a statement that the internal standard was relied
upon and that a copy of the internal standard shall be provided to the
claimant free of charge upon request; (vi) if the determination is based on
a medical necessity or experimental treatment or similar exclusion or
limit, an explanation of the scientific or clinical judgment for the
determination or a statement that such explanation shall be provided free
of charge upon request; and (vii) the following statement: "You and your
plan may have other voluntary alternative dispute resolution options, such
as mediation. One way to find out what may be available is to contact your
local U.S. Department of Labor Office and your State insurance regulatory
agency."
7.4 Limitations on Actions. No legal action may be commenced prior to
the completion of the benefit claims procedure described herein. In
addition, no legal action may be commenced after the later of (a) 180 days
after receiving the written response of
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the Committee to an appeal, or (b) 365 days after an applicant's original
application for benefits."
* * * * *
IN WITNESS WHEREOF, the Company has caused its duly authorized officer
to execute this amendment this 7th day of January, 2005.
OCCIDENTAL PETROLEUM CORPORATION
By: /s/ RICHARD W. HALLOCK
-----------------------------------------
Richard W. Hallock
Executive Vice-President, Human Resources
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