SCHEDULE 14A
(Rule 14a-101)
INFORMATION REQUIRED IN PROXY STATEMENT
SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a) of the Securities
Exchange Act of 1934
(Amendment No. )
Filed by the Registrant /x/
Filed by a Party other than the Registrant / /
Check the appropriate box:
/ / Preliminary Proxy Statement / / Confidential, for Use of
the Commission Only (as permitted
by Rule 14a-6(e)(2))
/x/ Definitive Proxy Statement
/ / Definitive Additional Materials
/ / Soliciting Material Pursuant to Rule 14a-11(c) or Rule 14a-12
OCCIDENTAL PETROLEUM CORPORATION
________________________________________________________________________
(Name of Registrant as Specified in Its Charter)
________________________________________________________________________
(Name of Person(s) Filing Proxy Statement, if other than the Registrant)
Payment of Filing Fee (Check the appropriate box):
/x/ No fee required.
/ / Fee computed on table below per Exchange Act
Rules 14a-6(i)(4) and 0-11.
(1) Title of each class of securities to which
transaction applies:
________________________________________________________________
(2) Aggregate number of securities to which transaction applies:
________________________________________________________________
(3) Per unit price or other underlying value of transaction computed
pursuant to Exchange Act Rule 0-11 (Set forth the amount on which
the filing fee is calculated and state how it was determined):
________________________________________________________________
(4) Proposed maximum aggregate value of transaction:
________________________________________________________________
(5) Total fee paid:
________________________________________________________________
/ / Fee paid previously with preliminary materials.
/ / Check box if any part of the fee is offset as provided
by Exchange Act Rule 0-11(a)(2) and identify the filing
for which the offsetting fee was paid previously. Identify
the previous filing by registration statement number, or the
Form or Schedule and the date of its filing.
(1) Amount Previously Paid:
________________________________________________________________
(2) Form, Schedule or Registration Statement No.:
________________________________________________________________
(3) Filing Party:
________________________________________________________________
(4) Date Filed:
________________________________________________________________
(Logo)
Notice of
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Occidental Petroleum Corporation
1998 Annual Meeting of Stockholders
and
Proxy Statement
Friday, May 1, 1998
Santa Monica Civic Auditorium
1855 Main Street Santa Monica, California
Meeting Hours
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Exhibit Room Opens 9:15 a.m.
Meeting 10:30 a.m.
Important
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Please promptly mark, sign,
date and return your proxy
card in the enclosed
envelope.
(Logo) OCCIDENTAL PETROLEUM CORPORATION
10889 WILSHIRE BOULEVARD
LOS ANGELES, CALIFORNIA 90024
DR. RAY R. IRANI
CHAIRMAN OF THE BOARD
AND
CHIEF EXECUTIVE OFFICER
March 17, 1998
Dear Stockholder:
On behalf of our Board of Directors, I cordially invite you to
attend Occidental's 1998 Annual Meeting of Stockholders at 10:30
a.m. on Friday, May 1, 1998, at the Santa Monica Civic
Auditorium, 1855 Main Street, Santa Monica, California.
Our business will include electing five directors, all of whom
are present Occidental directors, ratifying the selection of
independent public accountants and considering amendments to
Occidental's 1995 Incentive Stock Plan.
These matters are described in detail in the attached Proxy
Statement for the meeting.
The directors and officers of Occidental look forward to
seeing you at the meeting. As in the past, there will be a report
on operations and an opportunity for questions.
I encourage you to attend the meeting in person. Whether you
do so or not, however, I hope you will read the enclosed Proxy
Statement and then complete, sign and date the enclosed proxy
card and return it in the enclosed postage-prepaid envelope. This
will save Occidental additional expenses of soliciting proxies as
well as ensure that your shares are represented. Please note that
you may vote in person at the meeting even if you have previously
returned the proxy. Whether you vote in person or by proxy, your
vote will be kept confidential.
Sincerely yours,
R. R. IRANI
(Logo) OCCIDENTAL PETROLEUM CORPORATION
10889 WILSHIRE BOULEVARD
LOS ANGELES, CALIFORNIA 90024
Notice of Annual Meeting of Stockholders
To Be Held May 1, 1998
To the Stockholders:
The Annual Meeting of Stockholders of Occidental Petroleum
Corporation ("Occidental") will be held at the Santa Monica Civic
Auditorium, 1855 Main Street, Santa Monica, California, on
Friday, May 1, 1998, at 10:30 a.m. for the following purposes,
all as set forth in the attached Proxy Statement:
1. To elect five directors to serve for one-year terms
expiring at the annual meeting in 1999. The Board of
Directors' nominees are named in the attached Proxy Statement.
2. To ratify the selection of Arthur Andersen LLP as
independent public accountants for 1998.
3. To take action on amendments to Occidental's 1995
Incentive Stock Plan to, among other things, increase the
number of shares of Common Stock available for issuance under
the plan.
4. To transact such other business as may properly come
before the meeting or any adjournment thereof, including such
matters as may be duly proposed by stockholders. The Board of
Directors knows of one stockholder proposal that may be
presented at the meeting.
Only stockholders of record on the books of Occidental at the
close of business on March 6, 1998, will be entitled to receive
notice of and to vote at the meeting.
You are cordially invited to attend the meeting in person.
However, whether or not you expect to attend, we urge you to read
the accompanying Proxy Statement and then complete, sign, date
and return the enclosed proxy card in the enclosed
postage-prepaid envelope. It is important that your shares be
represented at the meeting, and your promptness will assist us to
prepare for the meeting and to avoid the cost of a follow-up
mailing. If you receive more than one proxy card because you own
shares registered in different names or at different addresses,
each proxy card should be completed and returned.
Sincerely,
DONALD P. DE BRIER
Los Angeles, California Donald P. de Brier
March 17, 1998 Secretary
PROXY STATEMENT
Annual Meeting of Stockholders To Be Held May 1, 1998
GENERAL INFORMATION
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This Proxy Statement is furnished to stockholders of
Occidental Petroleum Corporation, a Delaware corporation
("Occidental" or the "Corporation"), in connection with the
solicitation by the Board of Directors of Occidental (the "Board
of Directors" or "Board") of proxies for use at its Annual
Meeting of Stockholders (the "Meeting") scheduled to be held on
Friday, May 1, 1998, at 10:30 a.m., Los Angeles time, at the
Santa Monica Civic Auditorium, 1855 Main Street, Santa Monica,
California, and at any and all adjournments thereof. This Proxy
Statement and the enclosed form of proxy is being mailed
beginning on or about March 17, 1998.
At the Meeting, stockholders of Occidental will vote upon: (1)
the election of five directors for a term of one year; (2) the
ratification of the selection of independent public accountants
for 1998; (3) the proposal to amend Occidental's 1995 Incentive
Stock Plan (the "1995 Plan"); and (4) such other business as may
properly come before the Meeting and any and all adjournments
thereof, including matters proposed by stockholders. The Board of
Directors knows of one stockholder proposal that may be presented
at the Meeting.
VOTING RIGHTS AND VOTES REQUIRED
The close of business on March 6, 1998, has been fixed as the
record date for the determination of stockholders entitled to
receive notice of and to vote at the Meeting. As of the close of
business on such date, Occidental had outstanding and entitled to
vote 348,999,592 shares of Common Stock, par value $.20 per share
("Common Stock").
A majority of the outstanding shares of Common Stock must be
represented at the Meeting in order to hold the Meeting. The
record holder of each share of Common Stock entitled to vote at
the Meeting will have one vote for each share so held.
When no instructions have been given on a proxy card with
respect to a matter, the shares will be voted in the manner
specified on the card. Pursuant to New York Stock Exchange rules,
however, shares held through a broker, bank or other nominee
generally may not be voted by the nominee when no instructions
have been given except for matters which the New York Stock
Exchange determines to be routine. If a nominee cannot vote on a
particular matter because it is not routine, there is a "broker
nonvote" on that matter.
Directors are elected by a plurality of the votes cast.
Stockholders may not cumulate their votes. The five candidates
receiving the highest number of votes will be elected. In
tabulating the votes, broker nonvotes will be disregarded and
will have no effect on the outcome of the vote.
The affirmative vote of the holders of a majority of the
shares of Common Stock represented at the Meeting and entitled to
vote thereat will be required to ratify the selection of
independent public accountants, to adopt the amendments to the
1995 Plan and to adopt any stockholder proposal properly
presented at the Meeting. In determining whether a proposal has
received the requisite number of affirmative votes, abstentions
and broker nonvotes will have the same effect as votes against
the proposal.
VOTING OF PROXIES
In connection with the solicitation by the Board of Directors
of proxies for use at the Meeting, the Board has designated Drs.
Ray R. Irani and Dale R. Laurance and Mr. Aziz D. Syriani, and
each of them with full power of substitution, to vote shares
represented by such proxies. Shares represented by all properly
executed proxies will be voted at the Meeting in accordance with
the instructions specified thereon. If no instructions are
specified, the shares represented by any properly executed proxy
will be voted FOR the election of the nominees listed below under
"Election of Directors," FOR the ratification of the selection of
independent public accountants, FOR the amendment of the 1995
Plan and AGAINST the stockholder proposal.
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The Board of Directors is not aware of any matter that will
come before the Meeting other than as described above. If a
stockholder proposal that was excluded from this proxy statement
in accordance with Rule 14a-8 of the Securities and Exchange Act
of 1934 is properly brought before the Meeting, it is intended
that Drs. Irani and Laurance and Mr. Syriani will use their
discretionary authority to vote the proxies against such
proposal. If any other matter is properly presented, in the
absence of instructions to the contrary, such proxies will be
voted in accordance with the judgment of Drs. Irani and Laurance
and Mr. Syriani.
CONFIDENTIAL VOTING
Occidental has a policy that all proxies, ballots and other
voting materials that identify how a stockholder voted are to be
kept permanently confidential and are not to be disclosed to any
entity or person, including the directors, officers, employees or
stockholders of Occidental, except (i) to allow the tabulator to
tabulate and certify the vote, (ii) to comply with federal or
state law, including the order of any court, department or
agency, (iii) in connection with a contested proxy solicitation,
(iv) if a stockholder makes a written comment on a proxy card or
ballot or (v) if a stockholder expressly requests disclosure of
his or her vote. The receipt and tabulation of the proxies,
ballots and voting materials and the performance of the duties of
the inspector of elections must be by one or more parties
independent of Occidental, its Board of Directors and any
stockholder holding more than 10 percent of the voting securities
of Occidental. The tabulator and inspector of elections are
required to sign a statement acknowledging the obligation to
comply with the policy.
REVOCATION OF PROXIES
Any proxy given pursuant to this solicitation may be revoked
by a stockholder at any time before it is used to vote the shares
at the Meeting. Any proxy may be revoked by a writing, by a valid
proxy bearing a later date delivered to Occidental or by
attending the Meeting and voting in person.
SOLICITATION OF PROXIES
The expenses of this solicitation will be paid by Occidental.
To the extent necessary to ensure sufficient representation at
the Meeting, proxies may be solicited by any appropriate means by
officers, directors and regular employees of Occidental. None of
these people will receive any additional or special compensation
for such work. In addition, Occidental has engaged the services
of Georgeson & Company Inc., a firm specializing in proxy
solicitation, to solicit proxies and to assist in the
distribution and collection of proxy material for a fee estimated
at approximately $15,000, plus reimbursement of out-of-pocket
expenses. Occidental will reimburse persons holding stock in
their names or in the names of their nominees, but not owning
such stock beneficially (such as brokerage houses, banks and
other fiduciaries), for the expense of forwarding soliciting
material to their principals.
ELECTION OF DIRECTORS
The directors of Occidental currently are divided into three
classes. However, last year Occidental's Restated Certificate of
Incorporation was amended to phase out the classified Board. As a
result, directors elected at the Meeting and at each annual
meeting thereafter will be elected for a one-year term so that by
the annual meeting in 2000 the Board will cease to be classified.
All of the directors whose terms expire at the Meeting previously
were elected by the stockholders.
Occidental is firmly committed to achieving a diverse and
broadly inclusive work force and Board of Directors by creating
equal opportunity for men and women of every race, color,
religion, ethnicity, national origin and cultural background.
No person who has reached the age of 72 is eligible for
election as a director of Occidental except that any person who
at December 15, 1994, was aged 72 or older and serving as a
director was eligible for reelection as a
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director once, at the annual meeting of stockholders occurring
upon expiration of the term of office such director was serving
at December 15, 1994.
The five persons designated by the Board of Directors as
nominees for election at the Meeting as directors are Drs. Ray R.
Irani and Dale R. Laurance and Messrs. Edward P. Djerejian, Irvin
W. Maloney and Aziz D. Syriani.
It is intended that proxies received will be voted for the
election as directors of Drs. Ray R. Irani and Dale R. Laurance
and Messrs. Edward P. Djerejian, Irvin W. Maloney and Aziz D.
Syriani, to serve for one-year terms expiring at the 1999 annual
meeting, and until their successors are elected and qualified. In
the event any nominee should be unavailable at the time of the
Meeting, the proxies may be voted for a substitute nominee
selected by the Board of Directors.
The following biographical information is furnished with
respect to each of the five nominees for election at the Meeting
and for each of the other eight directors whose terms will
continue after the Meeting.
NOMINEES FOR TERM EXPIRING IN 1999
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(Photograph of Edward P. Djerejian)
EDWARD P. DJEREJIAN, 59 Director since 1996
Director-James A. Baker III Institute
for Public Policy at Rice University,
Houston, Texas.
Ambassador Djerejian assumed the position as the founding
Director of the James A. Baker III Institute for Public Policy at
Rice University in 1994. His career in foreign service has
spanned the administrations of eight U.S. Presidents. Ambassador
Djerejian served President Clinton as the United States
Ambassador to Israel from 1993 to 1994, both President Bush and
President Clinton as Assistant Secretary of State for Near
Eastern Affairs from 1991 to 1993 and President Reagan and
President Bush as U.S. Ambassador to the Syrian Arab Republic
from 1988 to 1991. Ambassador Djerejian also served as Deputy
Assistant Secretary of Near Eastern and South Asian Affairs from
1986 to 1988 and Deputy Chief of the U.S. mission to the Kingdom
of Jordan from 1981 to 1984. In 1985, he was assigned to the
White House as Special Assistant to the President and Deputy
Press Secretary for Foreign Affairs. Ambassador Djerejian is also
an expert in Soviet and Russian affairs and, from 1979 to 1981,
was assigned to the U.S. Embassy in Moscow, where he headed the
political section. Ambassador Djerejian joined the Foreign
Service in 1962, after serving in the United States Army as a
First Lieutenant in the Republic of Korea between 1961 and 1962.
In addition to his assignments in Moscow and Amman, he served as
a political officer in Beirut, Lebanon from 1966 to 1969 and
Casablanca, Morocco from 1969 to 1972. Between 1975 and 1977 he
was assigned as U.S. Consul General in Bordeaux, France.
Ambassador Djerejian graduated with a Bachelor of Science from
the School of Foreign Service at Georgetown University in 1960.
He received an Honorary Doctorate in the Humanities from his alma
mater in 1992. Ambassador Djerejian is a member of the Board of
Directors of Global Industries, Inc. Ambassador Djerejian
received the Presidential Distinguished Service Award in 1994,
the Department of State's Distinguished Honor Award in 1993 and
numerous other honors, including the President's Meritorious
Service Award in 1988, the Ellis Island Medal of Honor in 1993,
and the Anti-Defamation League's Moral Statesman Award in 1994.
He is a member of the Council on Foreign Relations, The Asia
Society, Business Council for International Understanding,
International Institute for Strategic Studies and The Bretton
Woods Committee.
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(Photograph of Dr. Ray R. Irani)
DR. RAY R. IRANI, 63 Director since 1984
Chairman of the Board and Chief
Executive Officer of Occidental.
Dr. Irani is the Chairman and Chief Executive Officer of
Occidental, having served as Chairman, President and Chief
Executive Officer of Occidental from 1990 until 1996. He has been
a director of the Corporation since 1984. He was President and
Chief Operating Officer of Occidental from 1984 to 1990 and
before that was an Executive Vice President of the Corporation.
Dr. Irani joined the Occidental organization in 1983 as Chairman
and Chief Executive Officer of Occidental Chemical Corporation.
He has been Chairman of the Board of Canadian Occidental
Petroleum Ltd. since 1987. From 1973 until he joined Occidental,
Dr. Irani held various positions with Olin Corporation and
ultimately served as President and Chief Operating Officer of
Olin Corporation and as a member of that firm's Board of
Directors.
Dr. Irani received a B.S. degree in chemistry from the
American University of Beirut in 1953 and a Ph.D. in physical
chemistry from the University of Southern California in 1957. He
holds 50 U.S. patents and more than 100 foreign patents, is the
author of the book Particle Size and has published more than 50
technical papers.
Dr. Irani is a director of the National Association of
Manufacturers, the American Petroleum Institute, the Jonsson
Cancer Center Foundation/UCLA, Cedars Bank and Kaufman and Broad
Home Corporation. He is a trustee of the University of Southern
California and serves on the CEO Board of Advisors of the
University's School of Business Administration. He also is a
trustee of St. John's Health Center Foundation and the American
University of Beirut and is a member of the Board of Governors of
Town Hall and the World Affairs Council.
Dr. Irani was the recipient of the American Institute of
Chemists' 1983 Honorary Fellow Award, Polytechnic University's
1988 Creative Technology Award and the Chemical Marketing
Research Association's 1990 Man of the Year Award. He received
the B'nai B'rith 1991 International Corporate Achievement Award
and, in 1992, the CEO of the Year Bronze Award from Financial
World magazine and the Americanism Award from the Boy Scouts of
America. He received the 1994 Distinguished Service Award
presented by the American Jewish Committee. In 1995, he was
selected by The Wall Street Transcript as its silver honoree, and
in 1996 he received the Asa V. Call Achievement Award from the
University of Southern California.
Dr. Irani was appointed in 1994 by President Clinton to the
President's Export Council, the premier national advisory
committee on international trade. Dr. Irani is the only appointee
to the Council from the energy and chemical industries.
Committee: Executive (Chairman).
(Photograph of Dr. Dale R. Laurance)
DR. DALE R. LAURANCE, 52 Director since 1990
President and Senior Operating Officer
of Occidental.
Dr. Laurance has been President of Occidental since 1996 and
Senior Operating Officer and a director of Occidental since 1990.
He joined Occidental in 1983 as a Vice President of Occidental
Chemical Corporation and was elected Vice President of Operations
of Occidental in 1984. He is also a Director of Canadian
Occidental Petroleum Ltd., Jacobs Engineering Group Inc.,
Leslie's Poolmart Inc., The Armand Hammer Museum of Art and
Cultural Center, Inc., Chemical Manufacturers Association,
American Petroleum Institute, U.S.-Arab Chamber of Commerce, Boy
Scouts of America-Western Los Angeles County Council and a member
of the Advisory Board of the Chemical Heritage Foundation. He is
a past Chairman of the Advisory Board for the Department of
Chemical and Petroleum Engineering at the University of Kansas
and is a recipient of the Distinguished Engineering Service Award
from the School of Engineering at the University of Kansas. Dr.
Laurance has served as a Managing Director of the Joffrey Ballet
Company.
Committee: Executive.
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(Photograph of Irvin W. Maloney)
IRVIN W. MALONEY, 67 Director since 1994
Chairman and Chief Executive Officer
of Dataproducts Corporation,
Simi Valley, California.
Mr. Maloney has been Chairman and Chief Executive Officer since
August 1997 of Dataproducts Corporation of Simi Valley,
California, which designs, manufactures and markets a complete
line of impact and nonimpact printers and supplies for computers.
He joined Dataproducts in 1988 and was elected President and
Chief Operating Officer in October 1991 and President and Chief
Executive Officer in April 1992. Prior to joining Dataproducts,
Mr. Maloney had served for three years as an Executive Vice
President of Contel Corporation and President of Contel's
information systems sector; was General Manager of Harris
Corporation's customer support and national accounts divisions;
and spent 27 years in various management positions with
International Business Machines, lastly as Vice President of
western field operations. He is affiliated with the Center for
Corporate Innovation.
Committees: Audit; Compensation.
(Photograph of Aziz D. Syriani)
AZIZ D. SYRIANI, 55 Director since 1983
President and Chief Operating Officer,
The Olayan Group of Companies.
Mr. Syriani has served since 1978 as the President and Chief
Operating Officer of The Olayan Group, a diversified trading,
services and investment organization with activities and
interests in the Middle East and elsewhere. He has been
associated with The Olayan Group since 1973, first as outside
legal counsel and then as a full time executive in 1976. Mr.
Syriani obtained his L.L.M. degree from Harvard Law School. Mr.
Syriani is a director of Credit Suisse First Boston.
Committees: Investment (Chairman); Nominating.
CONTINUING DIRECTORS
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(Photograph of John S. Chalsty)
JOHN S. CHALSTY, 64 Director since 1996
Chairman of Donaldson, Lufkin & Term expires 2000
Jenrette, Inc.,
New York, New York.
Mr. Chalsty is Chairman of Donaldson, Lufkin & Jenrette, Inc.
("DLJ"), an investment banking firm. He joined DLJ in 1969 as an
oil analyst and served in a series of increasingly responsible
positions, including President and Chief Executive Officer from
1986 until 1996, and Chairman and Chief Executive Officer from
1996 until early 1998. Before that, he worked 12 years for
Standard Oil Company of New Jersey (now Exxon) in the United
States and Europe.
Mr. Chalsty also serves on the boards of directors of The
Equitable Companies and IBP, inc. He was a director of the New
York Stock Exchange from 1988 to 1994 and served as its vice
chairman from 1990 to 1994. Mr. Chalsty is Chairman of the New
York City Economic Development Corporation. He also is a member,
past president and director of the New York Society of Financial
Analysts and a member and past director of Financial Analysts
Federation, as well as being active in civic, education, arts and
medical organizations.
Mr. Chalsty received Bachelor of Science degrees in chemistry
and physics and a Master of Science degree from the University of
Witwatersrand in Johannesburg, South Africa, and a Master of
Business Administration degree with high distinction from Harvard
Business School, where he was a Baker Scholar.
Committee: Nominating.
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(Photograph of Senator Albert Gore, Sr.)
SENATOR ALBERT GORE, Sr., 89 Director since 1972
Former Executive Vice President Term expires 1999
of Occidental; Former United States Senator.
Senator Gore was a United States Congressman for 14 years and
a Senator for 18 years. Thereafter, Senator Gore and his wife,
Pauline, were in the private practice of law with offices in
Washington, D.C., Nashville, Tennessee and Los Angeles,
California. He was elected an Executive Vice President of
Occidental and Chairman of the Board of Occidental's subsidiary
Island Creek Coal Company in September 1972. He held these
positions until August 1983.
As a legislator, he was a leader in the development of atomic
weapons programs, nuclear energy, foreign relations,
international trade and taxation. As a member of the Joint
Committee on Atomic Energy, the Finance Committee and the Foreign
Relations Committee, he coauthored the Gore-Holifield Bill
relating to the development of nuclear power and the Gore-Fallon
Interstate Highway Bill and was a leader and author of several
international trade amendments and bills. President Kennedy
appointed Senator Gore as a delegate to the United Nations where
he succeeded in negotiating an agreement on outer space between
the United States and the former Soviet Union.
Since retiring from Occidental, Senator Gore has served on the
faculty of Vanderbilt University and was a visiting scholar at
the Kennedy Institute of Harvard University, University of
California, Davis, and other institutions. Among other literary
undertakings, he is the author of two books: The Eye of the Storm
and Let the Glory Out. He is now active as a businessman in real
estate, cattle, automobiles, antique mall ventures and other
commercial undertakings.
(Photograph of Arthur Groman)
ARTHUR GROMAN, 83 Director since 1957
Lawyer-Senior Partner of the law firm Term expires 2000
of Mitchell, Silberberg & Knupp,
Los Angeles, California.
Mr. Groman has served on the Board of Directors of Occidental
longer than any other director, having been first elected in June
1957. He is the senior partner of the Los Angeles law firm of
Mitchell, Silberberg & Knupp, having been associated with that
firm since 1944. Previously, he was an attorney in the Office of
the General Counsel in the U.S. Treasury Department and an
attorney for the Bureau of Internal Revenue. He is the author of
numerous articles on taxation. Mr. Groman is a cofounder of the
Tax Institute of the Law School of the University of Southern
California, a Fellow of the American College of Trial Lawyers, a
past President of the California Institute for Cancer Research
and an emeritus member of the Board of Directors of Cedars-Sinai
Medical Center. He has served as President of the Yale Law School
Alumni Association of Southern California.
Committees: Executive; Nominating (Chairman).
(Photograph of J. Roger Hirl)
J. ROGER HIRL, 66 Director since 1988
Executive Vice President of Occidental; Term expires 2000
President and Chief Executive Officer of
Occidental Chemical Corporation.
Mr. Hirl became President and Chief Operating Officer of
Occidental Chemical Corporation in 1983 and its Chief Executive
Officer in 1991. He was elected an Executive Vice President of
Occidental in 1984. Before joining Occidental, he was Senior Vice
President of the Chemicals Group of Olin Corporation, where he
was responsible for all business units. During a 23-year career
with Olin, Mr. Hirl held a number of management positions,
including Vice President of Administration and Vice President and
General Manager of the company's industrial chemicals department.
Mr. Hirl is a graduate of the University of Iowa, where he
received a B.L.S. degree in liberal arts. Mr. Hirl is Chairman of
the Board of the Chlorine Chemistry Council and is an appointed
member of the Industry Policy Advisory Committee (IPAC), jointly
administered by the Office of the U.S. Trade Representative and
the Department of Commerce. He is a past
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Chairman of the Board of the Chemical Manufacturers Association,
the American Plastics Council, the Chlorine Institute and the
Society of Chemical Industry, American Section. He is a director
of Texas Taxpayers and Research Association, The Dallas Citizens
Council and The Dallas Together Forum and is vice chairman of the
Board of The Science Place, Dallas.
(Photograph of John W. Kluge)
JOHN W. KLUGE, 83 Director since 1984
Chairman of the Board and President Term expires 2000
of Metromedia Company,
New York, New York.
Mr. Kluge has been Chairman of the Board and President of
Metromedia Company since 1986. Metromedia Company is a
diversified investment partnership with activities in
telecommunications, food services, robotic painting and computer
software. Mr. Kluge is a director of Metromedia International
Group, Inc., Conair Corporation and Metromedia Fiber Network,
Inc. He is a Governor of the New York College of Osteopathic
Medicine, a Trustee of the Preventive Medicine Institute-Strang
Clinic and a member of the Advisory Committee of The Chase
Manhattan Corporation.
(Photograph of George O. Nolley)
GEORGE O. NOLLEY, 82 Director since 1983
Ranching and Investments. Term expires 1999
Mr. Nolley has been engaged in ranching and farming since 1961.
He was a founder, officer and director of The Permian
Corporation, which was subsequently (from 1965 to 1983) a wholly
owned subsidiary of Occidental, and he was a director of Cities
Service Company when Occidental acquired that company in 1982.
Committees: Audit (Chairman); Compensation (Chairman);
Environmental, Health and Safety; Investment.
(Photograph of Rodolfo Segovia)
RODOLFO SEGOVIA, 61 Director since 1994
President and Chief Executive Officer of Term expires 2000
Polipropileno del Caribe, S.A.
Bogota, Colombia.
Since August 1996, Mr. Segovia has served as the President and
Chief Executive Officer of Polipropileno del Caribe, S.A., a
manufacturer of polypropylene. From 1994 to 1996 and from 1986 to
1990, he served as the Managing Partner of Inversiones Sanford
S.A., where he continues to serve on the Executive Committee.
Inversiones Sanford is a conglomerate with interests in, among
other things, the manufacture of wire and cable, polyvinyl
chloride resins and compounds, and stabilizers and other
specialty chemicals for the plastic industry. He was a Senator of
the Republic of Colombia from 1990 to 1993 and the Minister of
Public Works and Transportation for the Republic of Colombia from
1985 to 1986. He was President of Empresa Colombiana de Petroleos
from 1982 to 1985 and prior to that spent 17 years with
Petroquimica Colombiana, S.A. in a number of management
positions, including President.
Mr. Segovia has a B.S. in Chemical Engineering from the
Massachusetts Institute of Technology, an M.A. in Latin American
History from the University of California, Berkeley, and a
Certificate in Economic Development from the French IRFED
institute. He is a member of the Colombian Academy of History and
a trustee of the University of Los Andes. He has been a lecturer
at the War College (Colombia) since 1981 and is the author of The
Fortifications of Cartagena de Indias, Strategy and History. Mr.
Segovia is a recipient of the Colombia Distinguished Engineers
Award and the Order of Merit of the French Republic.
Committee: Environmental, Health and Safety.
7
(Photograph of Rosemary Tomich)
ROSEMARY TOMICH, 60 Director since 1980
Owner, Hope Cattle Company and A. S. Tomich Term expires 1999
Construction Company; Chairman of the Board
of Directors and Chief Executive Officer,
Livestock Clearing Inc.
Miss Tomich has been owner of the Hope Cattle Company, a
feeding operation, since 1958. Since 1970, she has been the owner
of the A. S. Tomich Construction Company in Los Angeles,
California. Miss Tomich is a Trustee of the Salk Institute for
Biological Studies, a director of the Betty Clooney Foundation
for Persons with Brain Injury, a member of the Advisory Board
of the University of Southern California School of Business
Administration, a member of the President's Corporate Cabinet of
the California Polytechnic State University San Luis Obispo and a
Trustee of the UCLA Foundation.
Committees: Executive; Audit; Compensation; Environmental,
Health and Safety (Chairperson); Investment.
INFORMATION REGARDING THE BOARD OF DIRECTORS AND ITS COMMITTEES
-------
The Board of Directors has established an Executive Committee,
consisting of Dr. Irani, as Chairman, Mr. Groman, Dr. Laurance
and Miss Tomich, which, to the extent permitted by law, exercises
the powers of the Board with respect to the management of the
business and affairs of Occidental between Board meetings. The
Executive Committee held no meetings during 1997 and acted four
times by unanimous written consent in lieu of a meeting. The
Board has also established standing Audit; Compensation;
Nominating; Environmental, Health and Safety; and Investment
Committees. The general duties of these Committees are described
below. From time to time, the Board of Directors delegates
additional duties to the standing committees.
The Audit Committee, consisting of Mr. Nolley, as Chairman,
Miss Tomich and Mr. Maloney, recommends the firm of independent
public accountants to audit the consolidated financial
statements, books, records and accounts of Occidental and its
subsidiaries; discusses the scope and results of the audit with
the accountants; discusses Occidental's financial accounting and
reporting principles and the adequacy of Occidental's internal
accounting, financial and operating controls with the accountants
and with management; reviews all reports of internal audits
submitted to the Audit Committee and management's responses
thereto; reviews the appointment of the senior internal auditing
executive; and oversees all matters relating to the Corporation's
compliance program. The Audit Committee held 13 meetings in 1997.
The Compensation Committee, consisting of Mr. Nolley, as
Chairman, Miss Tomich and Mr. Maloney, administers the
Corporation's stock-based compensation plans, including selecting
participants, making grants and setting performance targets;
periodically reviews the performance of the plans and their
rules; reviews and approves the annual salaries, bonuses and
other benefits of all executive officers of the Corporation;
reviews new executive compensation programs; and periodically
reviews the operation of existing executive compensation programs
as well as policies for the administration of executive
compensation. The Compensation Committee held 13 meetings and
acted twice by unanimous written consent in 1997. The
Compensation Committee's report on executive compensation begins
at page 18.
The Nominating Committee, consisting of Mr. Groman, as
Chairman, and Messrs. Chalsty and Syriani, recommends candidates
for election to the Board. The Nominating Committee will consider
nominees recommended by stockholders if the stockholder
recommendations are forwarded to the Secretary of Occidental for
transmission to the Nominating Committee and are otherwise in
compliance with Occidental's By-laws. Under Occidental's By-laws,
nominations for directors, other than those made by the Board of
Directors, are subject to receipt by Occidental of notice of the
proposed nomination not less than 50 days nor more than 75 days
prior to the meeting; provided, however, that in the event that
less than 60 days' notice or prior public disclosure of the date
of the meeting is given or made to stockholders, notice by the
stockholder to be timely must be received not later than the
close of business on the 10th day following the day on which the
notice of the date of the meeting was mailed or such public
disclosure was made, whichever first occurs. Additional
information is also required as specified in Occidental's By-
laws, a copy of which may be obtained from Occidental upon
request. The Nominating Committee held one meeting in 1997.
8
The Environmental, Health and Safety Committee, consisting of
Miss Tomich, as Chairperson, and Messrs. Nolley and Segovia,
reviews and discusses with management the status of health,
environment and safety issues, including compliance with
applicable laws and regulations, the results of internal
compliance reviews and remediation projects; and reports
periodically to the Board on environmental, health and safety
matters affecting the Corporation and its subsidiaries. The
Environmental, Health and Safety Committee held six meetings in
1997.
The Investment Committee, consisting of Mr. Syriani, as
Chairman, Mr. Nolley and Miss Tomich, reviews and makes written
recommendations to the Board related to significant business
activities outside the areas of Occidental's primary business
operations. Although there were no matters for its consideration,
the Investment Committee acted twice by unanimous written consent
and held two meetings in 1997.
The Board of Directors held six regular meetings and acted
once by unanimous written consent during 1997. Each director,
except Mr. Kluge, attended at least 75 percent of the aggregate
of the meetings of the Board of Directors and the committees of
which he or she was a member.
Non-employee directors are paid a monthly retainer at the
annual rate of $25,000, plus $1,000 for each meeting of the Board
of Directors or of its committees they attend and, pursuant to
the 1996 Restricted Stock Plan for Non-Employee Directors,
receive an annual grant of 250 shares of Common Stock, plus an
additional 200 shares of Common Stock for each committee he or
she chairs. In addition, Occidental pays the premiums for non-
employee directors who participate in the Occidental Petroleum
Corporation Insured Medical Plan and, subject to availability,
permits directors to make use of company aircraft. Two directors
also received $1,000 for each meeting of the directors of the
Occidental Petroleum Charitable Foundation, Inc. they attended.
The Foundation held three meetings in 1997. Employee directors do
not receive any additional compensation for serving as directors.
CERTAIN RELATIONS AND RELATED TRANSACTIONS
-------
For many years, Occidental and certain of its subsidiaries
have used the services of the law firm of Mitchell, Silberberg &
Knupp, of which Mr. Groman is a senior partner. During 1997,
Occidental and such subsidiaries paid the firm approximately
$464,000 for legal services and disbursements. In addition,
Occidental has entered into a consultation agreement with Mr.
Groman pursuant to which he will render consulting services for a
term of seven years after he ceases to be a director for annual
compensation during such term of $25,000, with one-half of such
compensation payable to designated beneficiaries for the balance
of such term if he dies prior to its expiration.
Occidental from time to time uses the services of various
investment banking firms, including Donaldson, Lufkin & Jenrette,
Inc. ("DLJ"), of which Mr. Chalsty is Chairman. The compensation
paid to DLJ for services rendered to Occidental during 1997 did
not exceed five percent of DLJ's consolidated gross revenues for
its last full fiscal year.
CERTAIN LEGAL PROCEEDINGS
-------
On January 28 and 29, 1998, two shareholder derivative actions
were filed in Los Angeles Superior Court against the Board of
Directors of Occidental and Occidental, as a nominal defendant,
with respect to the payments made in 1997 to Occidental's
Chairman and President in connection with the restructuring of
their respective employment agreements. The Teachers' Retirement
System of Louisiana is the plaintiff in the first case, while
Rita Edelson, Paul Klingenstein and Clayton J. Steenson are named
as plaintiffs in the second action. Occidental is named as a
nominal defendant in these derivative actions. No relief is
sought against Occidental. The complaints allege, among other
things, corporate waste, breach of fiduciary duty and unjust
enrichment. The plaintiffs in both actions seek, among other
things, compensatory damages and equitable and declaratory relief
and seek to impose a constructive trust on the 1997 payments and
request that the Occidental Board be ordered to rescind the
payments. In addition, the plaintiffs in one of the actions seek
a declaration that the restated and amended employment agreements
are null and void and an order enjoining the receipt of
remuneration under the amended and restated agreements. In both
actions, the plaintiffs seek award of attorneys' fees and costs.
The two actions have been consolidated. For information
concerning the decision to restructure the Chairman's and
President's employment agreements, see the "Report of the
Compensation Committee" at page 18.
9
SECTION 16(A) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE
-------
Pursuant to Section 16(a) of the Securities Exchange Act of
1934 and the rules issued thereunder, Occidental's executive
officers, directors and any beneficial owner of more than 10
percent of any class of Occidental's equity securities are
required to file with the Securities and Exchange Commission and
the New York Stock Exchange reports of ownership and changes in
ownership of Common Stock. Copies of such reports are required to
be furnished to Occidental. Based solely on its review of the
copies of such reports furnished to Occidental, or written
representations that no reports were required, Occidental
believes that, during 1997, all persons required to report
complied with the Section 16(a) requirements, except David A.
Hentschel, Executive Vice President of Occidental and Chairman
and Chief Executive Officer of Occidental Oil and Gas
Corporation. Mr. Hentschel failed to file three reports and to
report 12 transactions on a timely basis.
SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS
AND MANAGEMENT
At the close of business on March 6, 1998, the beneficial
owners shown below were the only persons known to Occidental to
be the beneficial owners of five percent or more of any class of
the outstanding voting securities of Occidental.
- -----------------------------------------------------------------
Amount and
Nature of
Title of Name and Address Beneficial Percent of
Class of Beneficial Owner Ownership Class
- -----------------------------------------------------------------
Common FMR Corp. 34,602,311(1) 9.91%
Stock 82 Devonshire Street
Boston, Massachusetts
02109
Barrow, Hanley, 22,082,264(2) 6.33%
Mewhinney & Strauss,
Inc.
One McKinney Plaza
3232 McKinney Avenue,
15th Floor
Dallas, Texas 75204-
2429
- -----------------------------------------------------------------
(1) Pursuant to the Schedule 13G filed as of February 11,
1998, with the Securities and Exchange Commission ("SEC"), FMR
Corp. has sole voting power for 1,405,691 shares and sole
investment power for all of the shares. The number of shares of
Common Stock includes 688,387 shares resulting from the assumed
conversion of 389,800 shares of Occidental's $3.00 CXY-Indexed
Convertible Preferred Stock.
(2) Pursuant to the Schedule 13G filed as of February 12,
1998, with the SEC, Barrow, Hanley, Mewhinney & Strauss, Inc. has
sole voting power for 3,834,900 shares and sole investment power
for all of the shares.
The following table sets forth certain information regarding
the beneficial ownership of Common Stock as of March 6, 1998, by
each of the named executive officers, the directors of Occidental
and all executive officers and directors as a group. None of the
foregoing persons owned any other class of Occidental's equity
securities.
10
Amount and Percent
Nature of of Class
Name of Beneficial (Common
Beneficial Owner Ownership(1) Stock)
- -----------------------------------------------------------------
Ray R. Irani 1,857,527 (2)
Dale R. Laurance 353,523 (2)
J. Roger Hirl 238,651 (2)
John F. Riordan 234,035(3) (2)
John S. Chalsty 5,164 (2)
Edward P. Djerejian 556 (2)
Albert Gore, Sr. 34,587(4) (2)
Arthur Groman 17,900 (2)
John W. Kluge 1,020,500 (2)
Irvin W. Maloney 2,009 (2)
George O. Nolley 2,930 (2)
Rodolfo Segovia 6,614(5) (2)
Aziz D. Syriani 1,900 (2)
Rosemary Tomich 5,400 (2)
Stephen I. Chazen 129,598 (2)
All executive
officers and
directors as a
group (30 persons) 5,166,008(6) 1.48%
- -----------------------------------------------------------------
(1) Does not include shares acquired after December 31,
1997, under the Occidental Petroleum Corporation Savings Plan
(the "Savings Plan"), the MidCon Corp. Savings Plan or the
Dividend Reinvestment Plan. Each executive officer and director
possesses sole voting and investment power with respect to the
shares listed, except for 513,489 shares held by Dr. Irani,
67,658 shares held by Dr. Laurance, 36,033 shares held by Mr.
Hirl, 32,884 shares held by Mr. Riordan and 16,221 shares held by
Mr. Chazen, for which investment power had not vested pursuant to
the Occidental Petroleum Corporation Executive Long-Term
Incentive Stock Purchase Plan (the "Stock Purchase Plan"), the
Occidental Petroleum Corporation 1995 Incentive Stock Plan (the
"1995 Plan"), the Savings Plan or the MidCon Corp. Savings Plan
and 164 shares held by Mr. Chalsty, 356 shares held by Mr.
Djerejian, 500 shares held by Mr. Gore, 900 shares held by Mr.
Groman, 500 shares held by Mr. Kluge, 500 shares held by Mr.
Maloney, 1,300 shares held by Mr. Nolley, 500 shares held by Mr.
Segovia, 900 shares held by Mr. Syriani and 900 shares held by
Miss Tomich, for which investment power has not vested under the
1996 Restricted Stock Plan for Non-Employee Directors. Shares
shown also include the following shares subject to options
exercisable on March 6, 1998, or becoming exercisable within 60
days thereafter: Dr. Irani, 1,016,668 shares; Dr. Laurance,
213,334 shares; Mr. Hirl, 161,668 shares; Mr. Riordan, 151,668
shares and Mr. Chazen, 93,334 shares.
(2) Less than one percent.
(3) Holdings include 100 shares held by Mr. Riordan's wife,
as to which Mr. Riordan disclaims any beneficial ownership.
(4) Holdings include 5,500 shares held by Senator Gore's
wife, as to which Senator Gore disclaims any beneficial
ownership.
(5) Holdings include 5,000 shares held by Mr. Segovia as
trustee for the benefit of his children.
(6) Holdings include 2,605,765 shares that certain
executive officers and directors could acquire upon the exercise
of options exercisable on March 6, 1998, or becoming exercisable
within 60 days thereafter, as well as 804,934 shares issued
pursuant to the Stock Purchase Plan, the 1995 Plan, the Savings
Plan or the MidCon Corp. Savings Plan for which investment power
had not vested.
EXECUTIVE COMPENSATION
COMPENSATION TABLES
-------
Set forth below are tables showing: (1) in summary form, the
compensation paid, for the years shown in the table, to Dr. Irani
and the four other highest-paid executive officers of Occidental
serving as executive officers on December 31, 1997, including Mr.
Riordan who ceased serving as an executive officer and resigned
from the Board of Directors upon the divestiture of MidCon Corp.
in January 1998; (2) the options and stock appreciation rights
11
granted to such executives in 1997; (3) exercise and year-end
value information pertaining to stock options and stock
appreciation rights granted to such executives; and (4) long-term
incentive plan awards granted to such executives in 1997.
SUMMARY COMPENSATION TABLE
- -------------------------------------------------------------------------------------------------------------
Long-Term
Compensation
Annual Compensation Awards
----------------------------------- ----------------
Other Restricted
Annual Stock Securities All
Name and Compensa- Awards Underlying Other
Principal Salary Bonus tion(1) (2) Options/SARs Compensation
Position Year ($) ($) ($) ($) (#) ($)
- -------------------------------------------------------------------------------------------------------------
Ray R. 1997 $1,688,204 $1,420,000 $ 740,455(3) $ 2,343,157 1,000,000 $ 95,195,500(4)
Irani, 1996 $1,900,000 $ 872,000 $1,236,958(3) $ 2,611,666 200,000 $ 138,905(4)
Chairman 1995 $1,900,000 $ 872,000 $ 998,209(3) $ 2,459,444 200,000 $ 122,714(4)
and Chief
Executive
Officer
Dale R. 1997 $ 950,000 $ 750,000 $ 206,885(5) $ 217,504 750,000 $ 17,240,374(6)
Laurance, 1996 $ 860,000 $ 700,000 0 $ 164,010 85,000 $ 228,108(6)
President 1995 $ 820,000 $ 620,000 0 $ 394,991 45,000 $ 183,002(6)
and Senior
Operating
Officer
J. Roger 1997 $ 590,000 $ 380,000 $ 92,352(7) $ 101,705 395,000 $ 106,559(8)
Hirl, 1996 $ 565,000 $ 255,000 $ 132,169(7) $ 98,090 50,000 $ 98,624(8)
Executive 1995 $ 545,000 $ 420,000 0 $ 214,002 35,000 $ 90,689(8)
Vice
President
John F. 1997 $ 589,808 $ 878,000 $ 168,192(9) $ 101,705 395,000 $ 598,019(10)
Riordan, 1996 $ 565,000 $ 430,000 0 $ 98,090 50,000 $ 135,468(10)
Executive 1995 $ 545,000 $ 335,000 0 $ 209,998 35,000 $ 127,600(10)
Vice
President
Stephen I. 1997 $ 480,000 $ 380,000 0 $ 568,395 385,000 $ 90,096(11)
Chazen, 1996 $ 380,000 $ 308,000 0 $ 65,707 40,000 $ 65,741(11)
Executive 1995 $ 365,000 $ 275,000 0 $ 140,005 30,000 $ 57,135(11)
Vice
President
- -------------------------------------------------------------------------------------------------------------
(1) "0" indicates that, for the year indicated, the
executive officer listed did not receive perquisites or other
personal benefits, securities or property that exceeded the
lesser of $50,000 or 10 percent of the salary and bonus for such
officer.
(2) Includes awards made in January 1997 to each of the
executive officers listed and an award to Mr. Chazen in February
1998 pursuant to the Occidental Petroleum Corporation 1995
Incentive Stock Plan (the "1995 Plan"), subject to a four-year
restricted period. During the restricted periods, dividends are
paid on the shares awarded. As of December 31, 1997, Dr. Irani
held 609,996 shares of restricted stock, having a value of
$17,880,508; Dr. Laurance 81,615 shares, having a value of
$2,392,340; Mr. Hirl 44,763 shares, having a value of $1,312,115;
Mr. Riordan 38,673 shares, having a value of $1,133,602; and Mr.
Chazen 13,273 shares, having a value of $389,065.
(3) Includes for 1997, 1996 and 1995, respectively, unless
otherwise noted: $539,959, $1,215,472 and $981,704 of
reimbursements, pursuant to Dr. Irani's employment agreement, for
state income tax expenditures; $11,670, $20,486 and $15,505 for
club dues; $10,132, $1,000 and $1,000 for tax preparation
services; $87,745 (1997 only) for financial planning services;
$75,462 (1997 only) for legal services; and $15,487 (1997 only)
for use of company aircraft.
(4) Includes for 1997, 1996 and 1995, respectively, unless
otherwise noted: $95,000,000 (1997 only) for restructuring
employment contract; $107,134, $107,666 and $93,985 of director's
fees paid by an equity investee of Occidental; $7,200, $6,750 and
$6,750 credited pursuant to the Occidental Petroleum Corporation
Savings Plan (the "Savings Plan"); $13,200 (1997 only) credited
pursuant to the Occidental Petroleum Corporation Retirement Plan
(the "Retirement Plan"), a tax-qualified, defined contribution
plan that provides retirement benefits for salaried employees of
Occidental and certain of its subsidiaries; $37,899 (1997 only)
credited pursuant to the Occidental Petroleum Corporation Senior
Executive Supplemental Retirement Plan (the "Senior Retirement
Plan"), a nonqualified plan that was established to provide
designated senior executives of Occidental and its subsidiaries
with benefits that will compensate them for certain limitations
imposed by federal law on contributions that
12
may be made pursuant to the Retirement Plan and Savings Plan;
and $30,067, $24,489 and $21,979 of accrued interest on deferred
compensation.
(5) Includes for 1997: $87,982 for club membership and
dues; $75,462 for legal services; $42,441 for personal use of
company aircraft; and $1,000 for tax preparation services.
(6) Includes for 1997, 1996 and 1995, respectively, unless
otherwise noted: $17,000,000 (1997 only) for restructuring
employment contract; $67,987, $80,123 and $47,036 of director's
fees paid by equity investees of Occidental; $7,200, $6,750 and
$6,750 credited pursuant to the Savings Plan; $13,200, $14,250
and $14,250 credited pursuant to the Retirement Plan; $133,080,
$111,240 and $106,320 credited pursuant to Senior Retirement
Plan; and $18,907, $9,220 and $3,726 of accrued interest on
deferred compensation.
(7) Includes for 1997 and 1996, respectively, unless
otherwise noted: $61,807 and $99,034 for personal use of company
aircraft; $550 and $16,436 for tax and financial planning
services; $23,505 and $14,411 for club dues; $1,072 and $2,288
for automobile maintenance; and $5,418 (1997 only) for spousal
travel.
(8) Includes for 1997, 1996 and 1995, respectively: $7,200,
$6,750 and $6,750 credited pursuant to the Savings Plan; $11,600,
$12,750 and $12,750 credited pursuant to the Retirement Plan;
$75,280, $70,590 and $67,365 credited pursuant to the Senior
Retirement Plan; and $22,479, $8,534 and $3,824 of accrued
interest on deferred compensation.
(9) Includes for 1997: $131,613 for relocation; $33,879 for
personal use of company aircraft; and $2,700 for tax preparation
services.
(10) Includes for 1997, 1996 and 1995, respectively, unless
otherwise noted: $7,200, $6,750 and $6,750 credited pursuant to
the MidCon Corp. Savings Plan; $11,296, $10,378 and $12,750
credited pursuant to the MidCon Corp. Retirement Plan; $100,783,
$101,211 and $94,615 credited pursuant to the MidCon Corp.
Supplemental Retirement Plan; $26,423, $16,839 and $13,485 of
accrued interest on deferred compensation; and $452,317 and $290
(1997 and 1996 only) allocated pursuant to the MidCon Corp.
Employee Stock Ownership Plan (the "MidCon ESOP"). The value of
the share allocation made to the MidCon ESOP as of December 31,
1997 is not final as of the date hereof.
(11) Includes for 1997, 1996 and 1995, respectively unless
otherwise noted: $7,200, $6,750 and $6,750 credited pursuant to
the Savings Plan; $13,200, $14,250 and $14,250 credited pursuant
to the Retirement Plan; $55,530, $38,565 and $36,135 credited
pursuant to the Senior Retirement Plan; and $14,166 and $6,176
(1997 and 1996 only) of accrued interest on deferred
compensation.
OPTION/SAR GRANTS IN 1997
- ------------------------------------------------------------------------------
Number of Percent of
Securities Total Grant
Underlying Options/SARs Exercise Date
Options/SARs Granted to or Base Present
Granted(1) Employees Price(2) Expiration Value(4)
Name (#) in 1997 ($/Share) Date(3) ($)
- ------------------------------------------------------------------------------
Ray R. 3,940 0.1% $25.375 07/02/2007 $ 20,212
Irani 196,060 3.0% $25.375 07/02/2007 $1,005,788
800,000 12.4% $25.375 07/02/2007 $3,968,000
Dale R. 3,940 0.1% $25.375 07/02/2007 $ 20,212
Laurance 96,060 1.5% $25.375 07/02/2007 $ 492,788
650,000 10.5% $25.375 07/02/2007 $3,224,000
J. Roger 3,940 0.1% $25.375 07/02/2007 $ 20,212
Hirl 66,060 1.0% $25.375 07/02/2007 $ 338,888
325,000 5.0% $25.375 07/02/2007 $1,612,000
John F. 3,940 0.1% $25.375 07/02/2007 $ 20,212
Riordan 66,060 1.0% $25.375 07/02/2007 $ 338,888
325,000 5.0% $25.375 07/02/2007 $1,612,000
Stephen I. 3,940 0.1% $25.375 07/02/2007 $ 20,212
Chazen 56,060 0.9% $25.375 07/02/2007 $ 287,588
325,000 5.0% $25.375 07/02/2007 $1,612,000
- -------------------------------------------------------------------------------
13
(1) Each of the named executive officers received a
simultaneous grant of Incentive Stock Options ("ISOs"), Non-
Qualified Stock Options ("NQSOs") and Performance Stock Options
("PSOs"). The number of ISOs is listed first in the foregoing
table, the number of NQSOs is listed second and the number of
PSOs is listed third. The ISOs and NQSOs were granted subject to
a three-year vesting period, with approximately one-third of the
options granted becoming exercisable each year commencing on the
first anniversary of the grant date and ending on the third
anniversary. The PSOs vest in their entirety if the closing price
of Occidental Common Stock for 20 consecutive trading days is (i)
$30 per share any time prior to the third anniversary of the date
of grant, (ii) $35 per share any time on or after the third
anniversary of the date of grant to the day prior to the fifth
anniversary and (iii) $40 per share any time on or after the
fifth anniversary of the date of grant to the day prior to the
tenth anniversary. The vesting and exercisability of the options
will be accelerated in the event of a Change of Control (as
defined in the 1995 Plan). No stock appreciation rights were
granted in 1997.
(2) The exercise price and tax withholding obligations
related to exercise may be paid by delivery of already owned
shares or by offset of the underlying shares, subject to certain
conditions.
(3) The options were granted for terms of 10 years, in each
case subject to earlier termination upon the termination of an
optionee's employment; after which termination, the options that
have vested remain exercisable (depending on the cause of
termination) for a period of up to 18 months in the case of ISOs
and NQSOs and five years in the case of PSOs. However, under the
provisions of their respective employment agreements, the options
granted to Drs. Irani and Laurance become fully vested
immediately in the event of termination by Occidental and are
then exercisable as if the termination were due to retirement,
subject to the terms of the existing option grant agreements,
which are not affected by the employment agreements. Under the
terms of their respective employment agreements, the options
granted to Messrs. Hirl, Riordan and Chazen continue to vest and
are exercisable after termination of employment for the remaining
terms of their respective agreements in the case of Messrs. Hirl
and Riordan and for a period equal to the shorter of two years or
the remaining term of his agreement in the case of Mr. Chazen.
See "Employment Agreements" at page 15. The PSO grant agreement
provides that, in the event of any conflict between the terms of
such agreement and any present or future employment agreement,
the terms of the PSO grant agreement will govern.
(4) Options are granted at market price on the day of the
grant. The proxy rules require that either potential realizable
values at assumed annual stock price appreciation rates or
present values at the grant date be assigned to options.
Occidental has chosen a present value method known as the "Black-
Scholes option pricing model." The assumptions used to arrive at
the values shown were as follows: expected volatility-22.36%,
risk-free rate of return-6.27%, dividend yield-3.94% and time of
exercise-5 years. The choice of the Black-Scholes valuation
method does not reflect any belief by Occidental's management
that such method, or any other valuation method, can accurately
assign a value to an option at the grant date.
AGGREGATED OPTION/SAR EXERCISES IN 1997
AND DECEMBER 31, 1997 OPTION/SAR VALUES
- ------------------------------------------------------------------------------------------------------
Shares
Aquired Number of Securities Value of Unexercised
on Value Underlying Unexercised In-the-Money Options/SARs
Exercise Realized(1) Options/SARs at 12/31/97 (#) at 12/31/97(2) ($)
Name (#) ($) Exercisable Unexercisable Exercisable Unexercisable
- ------------------------------------------------------------------------------------------------------
Ray R. 50,000 $206,250 950,002 1,199,998 $7,426,052 $5,008,323
Irani
Dale R. 10,000 $ 41,250 198,334 821,666 $1,478,649 $3,325,726
Laurance
J. Roger 1,347 $ 5,220 150,002 439,998 $1,089,802 $1,792,073
Hirl
John F. 5,000 $ 20,625 140,002 439,998 $1,062,802 $1,792,073
Riordan
Stephen I. 0 0 83,335 421,665 $ 767,718 $1,709,470
Chazen
- ------------------------------------------------------------------------------------------------------
(1) Represents the difference between the closing price of
the Common Stock on the New York Stock Exchange on the exercise
date and the option exercise price.
(2) The value of unexercised in-the-money options is
calculated by multiplying the number of underlying shares by the
difference between the closing price of the Common Stock on the
New York Stock Exchange at 12/31/97 and the option exercise
price.
14
LONG-TERM INCENTIVE PLAN--AWARDS IN 1997(1)
- -----------------------------------------------------------------------------
Number of Performance Estimated Future Payouts
Shares, or Other Under
Units or Period Non-Stock Price-Based Plans
Other Until Threshold Target Maximum
Rights Maturation (# of (# of (# of
Name (#) or Payout shares) shares) shares)
- -----------------------------------------------------------------------------
Ray R. 0 -- -- -- --
Irani
Dale R. 18,609 4 years(2) 0 18,609 32,566
Laurance
J. Roger 8,943 4 years(3) 0 8,943 15,650
Hirl
John F. 8,943 4 years(3) 0 8,943 15,650
Riordan
Stephen I. 6,015 4 years(3) 0 6,015 10,526
Chazen
- -----------------------------------------------------------------------------
(1) Performance Stock Awards were made in January 1997
pursuant to the 1995 Plan. The number of shares received at the
end of the performance period will depend on the attainment of
performance objectives based on a peer company comparison of
total stockholder return. Depending on Occidental's ranking among
its peers and subject to the grantee remaining employed
throughout the performance period, the grantee receives shares of
Common Stock in an amount ranging from 0% to 175% of the Target
Share Award; provided, however, if the grantee dies, becomes
disabled or retires during the performance period, then the right
to receive more than the Target Shares is forfeited and a portion
of the Target Shares is forfeited depending on the days remaining
in the performance period. During the performance period,
dividend equivalents are credited on the Target Shares in an
amount equal to the per share dividend declared per share of
Common Stock and cash equal to the dividend equivalent is paid to
the grantees. In the event of a Change of Control (as defined in
the 1995 Plan), the grantee's right to receive the number of
Target Shares becomes nonforfeitable.
(2) Under the terms of his employment agreement, any long-
term incentive awards granted to Dr. Laurance become fully vested
immediately in the event of termination by Occidental, subject to
the terms of the existing award agreements, which are not
affected by his employment agreement. See "Employment Agreements"
below.
(3) Under the terms of their respective employment
agreements, the performance period for the entire award granted
to Messrs. Hirl, Riordan and Chazen continues after termination
of employment for the remaining terms of their respective
agreements in the case of Messrs. Hirl and Riordan and for a
period equal to the shorter of two years or the remaining term of
his agreement in the case of Mr. Chazen. See "Employment
Agreements" below.
EMPLOYMENT AGREEMENTS
-------
The following are summaries of the employment agreements
between Occidental and the executive officers named in the
Compensation Tables. Copies of the agreements are, or will be,
available as exhibits to Occidental's periodic reports filed with
the Securities and Exchange Commission.
DR. IRANI
On September 11, 1997, Dr. Irani entered into an amended and
restated employment agreement with Occidental. The agreement, as
amended, is for a five-year term with an annual salary at a
minimum rate of $1,200,000, subject to annual increase (and, as
part of across-the-board reductions for other officers, decrease)
at the reasonable discretion of the Board and the Compensation
Committee. In addition, Dr. Irani is eligible for a discretionary
annual cash bonus and to participate in Occidental's qualified
and nonqualified retirement plans, its incentive stock plan,
deferred compensation plan and any future performance plans
adopted by Occidental as well as any group life insurance,
medical care (including coverage for his wife and children),
disability and other plans or benefits which Occidental may
provide for him. Prior to his retirement, Dr. Irani will receive
life insurance at least equal to three times his highest career
annual salary plus, during the term of his employment, six weeks
paid vacation each calendar year (which will accrue and for which
he will be entitled to be paid for any accrued but unused
vacation time upon termination of the agreement) and the minimum
perquisites to which he was entitled prior to the effective date
of his agreement other than reimbursement for state income tax.
See also footnote (3) to the Compensation Table on page 12.
15
Following his retirement or upon the termination of his
employment by Occidental, Dr. Irani will continue to receive life
insurance equal to twice his highest career annual salary,
medical benefits no less favorable than those provided to him
prior to such retirement or termination, and tax and financial
planning services. If Dr. Irani is married at the time of his
death, his wife will be entitled, for the remainder of her life,
to continuation of medical benefits throughout her life. If Dr.
Irani is terminated by Occidental for any reason, or if Dr. Irani
terminates employment because Occidental materially breaches the
agreement, then if such event occurs on or prior to September 11,
2000, Dr. Irani is entitled to receive three times his highest
annual salary and bonus (subject to certain offsets in the case
of termination due to disability) without obligation to mitigate
and, if such event occurs after September 11, 2000, but on or
before September 11, 2002, he is entitled to receive two times
his highest annual salary and bonus (subject to certain offsets
in the case of termination due to disability) without obligation
to mitigate. In either such event of termination, Dr. Irani is
also entitled to receive his medical, welfare and life insurance
benefits; and if such termination is not due to death or
disability, his existing perquisites and the full and immediate
vesting of his restricted stock, stock options and any other long-
term incentive benefits; provided that the options or stock
appreciation rights shall be exercisable as if he had retired on
such date and that nothing in his employment agreement affects
his existing grant agreements. If after termination of his
employment, Dr. Irani is not eligible to participate in
Occidental's benefit plans as contemplated by his employment
agreement, then Occidental will provide Dr. Irani with
substantially equivalent benefits and will reimburse him for any
additional tax liabilities incurred by him as a result of his
receipt of such benefits.
If Occidental materially breaches the agreement and does not
cure the breach after notice thereof, Dr. Irani may terminate his
employment and treat such occurrence as if it were a termination
by Occidental; provided that it shall not be a material breach
if, following the merger or sale of Occidental or substantially
all of its assets, Dr. Irani continues to have substantially the
same executive duties and reports to the acquiror's board of
directors. The agreement also holds Dr. Irani harmless from the
effects of any excise or other taxes payable under or as a result
of Sections 280G and 4999 of the Internal Revenue Code of 1986 or
comparable state law by reason of a change of control, including
taxes payable on any amounts paid pursuant to this hold harmless
provision. During and after the term of the agreement, Dr. Irani
is entitled to the payment of all legal fees other than those of
a purely personal nature. In addition, the agreement provides for
additional indemnification for Dr. Irani to the fullest extent
permitted by applicable law and for Occidental to maintain
Directors' and Officers' liability insurance with policy limits
aggregating not less than $100 million, insuring Dr. Irani
against occurrences which occur during the term of the agreement.
For further information concerning the decision to restructure
Dr. Irani's agreement see "Report of the Compensation Committee"
at page 18.
DR. LAURANCE
On September 11, 1997, Dr. Laurance entered into an amended
and restated employment agreement with Occidental. This
agreement, as amended, is for a five-year term with an annual
salary at a minimum rate of $950,000, subject to annual increase
(and, as part of across-the-board reductions for other officers,
decrease) at the reasonable discretion of the Board and the
Compensation Committee. In addition, Dr. Laurance is eligible for
a discretionary annual cash bonus and to participate in
Occidental's qualified and nonqualified retirement plans, its
incentive stock plan, deferred compensation plan and any future
performance plans adopted by Occidental as well as any group life
insurance, medical care (including coverage for his wife and
children), disability and other plans or benefits which
Occidental may provide for him. Prior to his retirement, Dr.
Laurance will receive life insurance at least equal to three
times his highest career annual salary plus, during the term of
his employment, the minimum perquisites to which he was entitled
prior to the effective date of his agreement. See also footnote
(5) to the Compensation Table on page 13.
Following his retirement or upon the termination of his
employment by Occidental, Dr. Laurance will continue to receive
life insurance equal to twice his highest career annual salary,
medical benefits no less favorable than those provided to Dr.
Laurance prior to such retirement or termination, and tax and
financial planning services. If Dr. Laurance is married at the
time of his death, his wife will be entitled, for the remainder
of her life, to continuation of medical benefits throughout her
life. If Dr. Laurance is terminated by Occidental for any reason,
or if Dr. Laurance terminates employment because Occidental
materially breaches the agreement, then if such event occurs on
or prior to September 11, 2000, Dr. Laurance is entitled to
receive three times his highest annual salary and bonus (subject
to certain offsets in the case of termination due to disability)
without obligation to mitigate and, if such event occurs
16
after September 11, 2000, but on or before September 11, 2002,
he is entitled to receive two times his highest annual salary and
bonus (subject to certain offsets in the case of termination due
to disability) without obligation to mitigate. In either such
event of termination, Dr. Laurance is entitled to receive his
medical, welfare and life insurance benefits; and if such
termination is not due to death or disability, the full and
immediate vesting of his restricted stock, stock options and any
other long-term incentive benefits; provided that the options or
stock appreciation rights shall be exercisable as if he had
retired on such date and that nothing in his employment agreement
affects his existing grant agreements. If after termination of
his employment, Dr. Laurance is not eligible to participate in
Occidental's benefit plans as contemplated by his employment
agreement, then Occidental will provide Dr. Laurance with
substantially equivalent benefits and will reimburse him for any
additional tax liabilities incurred by him as a result of his
receipt of such benefits.
If Occidental materially breaches the agreement and does not
cure the breach after notice thereof, Dr. Laurance may terminate
his employment and treat such occurrence as if it were a
termination by Occidental; provided that it shall not be a
material breach if, following the merger or sale of Occidental or
substantially all of its assets, Dr. Laurance continues to have
substantially the same executive duties and reporting
relationships. The agreement also holds Dr. Laurance harmless
from the effects of any excise or other taxes payable under or as
a result of Sections 280G and 4999 of the Internal Revenue Code
of 1986 or comparable state law by reason of a change of control,
including taxes payable on any amounts paid pursuant to this hold
harmless provision. During and after the term of the agreement,
Dr. Laurance is entitled to the payment of all legal fees other
than those of a purely personal nature. In addition, the
agreement provides for additional indemnification for Dr.
Laurance to the fullest extent permitted by applicable law and
for Occidental to maintain Directors' and Officers' liability
insurance with policy limits aggregating not less than $100
million, insuring Dr. Laurance against occurrences which occur
during the term of the agreement. For further information
concerning the decision to restructure Dr. Laurance's agreement,
see "Report of the Compensation Committee" on page 18.
MR. HIRL
Mr. Hirl has an employment agreement with Occidental for a
term expiring in May 2002, providing for an annual salary of not
less than $590,000. If Mr. Hirl's employment is terminated as a
result of incapacity and he is a participant in and qualifies for
benefits under Occidental's Long-Term Disability Plan (the "LTD
Plan"), Occidental will pay Mr. Hirl the difference between 60
percent of his annual salary and the maximum annual LTD Plan
benefit, for so long as he remains eligible to receive LTD Plan
benefits. In the event Occidental terminates Mr. Hirl without
cause, then Occidental will pay Mr. Hirl at his current base
salary rate for a period (the "Compensation Period") equal to the
shorter of two years or the remaining term of his agreement with
Occidental. During the Compensation Period, Mr. Hirl will
continue to be eligible to participate in all employee benefit
plans available to salaried employees and senior executives and
to exercise options previously granted him that are or become
exercisable. Following the Compensation Period, Mr. Hirl shall
continue as a consultant to Occidental until May 2002, for which
he will receive an annual salary of $50,000. During the
Compensation Period and any consulting period, any stock awards
granted prior to Mr. Hirl's termination will continue to vest in
the same manner and in the same amounts as if he continued as a
full-time employee.
MR. RIORDAN
Mr. Riordan had an employment agreement with Occidental for a
term expiring in November 2002, which provided for an annual
salary of not less than $590,000 for services rendered prior to
the date the divestiture of MidCon was consummated (the "MidCon
Divestiture Date"). The MidCon Divestiture Date occurred on
January 30, 1998. During the period from the MidCon Divestiture
Date through the term of the agreement (the "Post Divestiture
Period"), Mr. Riordan will make himself available to Occidental
as a source of information with respect to matters deemed to be
within his expertise. Since the MidCon Divestiture Date occurred
during the term of his agreement, Mr. Riordan will receive,
subject to certain offset rights, an incentive bonus equal to
three times his current salary ($590,000), payable in equal semi-
monthly installments over the Post Divestiture Period and a
severance bonus equal to two times his then current salary,
payable in November 2002 or such earlier date as is mutually
agreeable. During the Post Divestiture Period, Mr. Riordan will
be eligible to participate in Occidental's employee benefit plans
(including the medical and dental programs and savings and
retirement plans but excluding any incentive compensation
programs), and to exercise any options that are or become
exercisable. During the Post Divestiture
17
Period, any stock awards previously granted to Mr. Riordan
will continue to vest in the same manner and in the same amounts
as if he had continued as a full-time employee.
MR. CHAZEN
Mr. Chazen has an employment agreement with Occidental for a
term expiring in April 1999, providing for an annual salary of
not less than $350,000. In the event Occidental terminates Mr.
Chazen without cause, Occidental will pay Mr. Chazen at his then
current base salary for a period (the "Post-Termination Period")
equal to the shorter of two years or the remaining term of his
agreement. During the Post-Termination Period, Mr. Chazen will
continue to be eligible to participate in Occidental's employee
benefit plans, other than short and long term disability and to
continue to exercise any stock awards granted prior to his
termination that are or become exercisable. During the Post-
Termination Period, any stock awards will continue to vest as
though Mr. Chazen were a full-time employee unless he accepts a
full-time position with another employer. In addition, Occidental
will indemnify Mr. Chazen for judgments, fines, settlements,
loss, cost or expense arising out of his activities as an
employee of Occidental to the fullest extent permitted by
applicable law and will maintain Directors' and Officers'
liability insurance with policy limits aggregating not less than
$100 million, insuring Mr. Chazen against occurrences which occur
during his employment with Occidental.
REPORT OF THE COMPENSATION COMMITTEE
-------
The Compensation Committee of the Board of Directors (the
"Committee") is responsible for Occidental's executive
compensation programs. The Committee is selected from members of
the Board of Directors (the "Board") who are neither current
employees nor officers of Occidental. This report is provided by
the Committee to assist stockholders in understanding the
philosophy and objectives underlying the compensation of
Occidental's senior executives.
PHILOSOPHY
Occidental's executive compensation programs are designed to
attract and retain top-quality executive talent and also to
provide incentives for them to enhance stockholder value. The
Committee believes that the compensation of Occidental's
executives should:
- be closely linked to business performance;
- encourage stock ownership by executives to
directly align executive interests with
stockholder interests;
- maintain an appropriate balance between base
salary and annual and long-term incentive
opportunities;
- target a competitive total compensation level that
is at or above the median pay levels of our peer
companies; and
- recognize and reward exceptional individual
contributions to the success of Occidental.
Occidental is firmly committed to the principle of pay-for-
performance, and the programs described below are focused on
increasing stockholder value by linking executive compensation to
business performance.
EXECUTIVE COMPENSATION PROGRAMS
Occidental's executive compensation programs are composed of
three main elements:
- Base salary
- Annual incentives
- Long-term incentives
Base salary and annual cash incentives are designed to attract
and retain top quality executives and to recognize individual
performance and achievement of business objectives each year. The
value of long-term incentives is
18
directly linked to the performance of the Common Stock and,
therefore, to total stockholder return. Long-term incentives may
take the form of stock options, stock appreciation rights,
performance stock and restricted stock.
In evaluating Occidental's executive compensation programs,
the Committee solicits the services of outside compensation
consultants and Occidental's compensation staff regarding plan
design and industry pay practices. Occidental participates in a
number of compensation surveys each year that are conducted by
third-party compensation consulting firms. These surveys are
focused primarily on Occidental's peer companies, which, for the
most part, consist of the major U.S. petroleum and chemical
companies (including companies within the peer group selected for
the graphs presented under the subheading "Performance Graphs").
In addition, compensation data is also obtained from broad-based
industry surveys of companies that are similar in size to
Occidental.
Cash Compensation
In determining base salary levels, Occidental maintains an
administrative framework of job levels into which positions are
assigned based on internal comparability and external market
data. Generally, base salaries are reviewed annually and adjusted
as appropriate to reward performance and maintain our competitive
position.
Since 1995, cash incentive awards have been granted under the
Occidental Petroleum Corporation Executive Incentive Compensation
Plan. Participation is determined by job level and is intended to
reward individuals who have a significant impact on business
performance. Under the Executive Incentive Compensation Plan, 60
percent of a participant's award is based on the attainment of
predetermined financial objectives by Occidental and its
subsidiaries and 40 percent is based on a subjective assessment
of the participant's achievement of predetermined individual
performance objectives and the participant's response to
unanticipated challenges during the plan year.
Long-Term Incentives
Under the 1995 Plan, long-term incentives may be awarded in
the form of stock options, stock appreciation rights ("SARs"),
restricted stock and performance stock. All stock options,
including performance stock options, and SARs awarded will be
subject to vesting requirements and none may be awarded at a
discount. The receipt of performance stock will be based on
Occidental's relative performance compared to its peer companies,
as measured by total stockholder return, over a specified
performance period. Selection for participation in the 1995 Plan
is made on a subjective assessment of the executive's potential
to influence Occidental's future performance. The Committee
believes awards under the 1995 Plan will create an effective long-
term incentive to increase stockholder value and will provide a
retention vehicle for key executives. Further, it is intended
that by providing more compensation that is stock-based,
executives will be encouraged to view Occidental from the
stockholders' perspective.
Employment Agreements
Occidental offers employment agreements to key executives only
when it is in the best interest of Occidental and its
stockholders to attract and retain such key executives and to
ensure continuity and stability of management. In accordance with
a policy adopted by the Board of Directors in November 1992, no
employment agreements with new executives will contain
provisions, commonly referred to as "golden parachutes," that
provide for additional severance benefits in the event of a
change in control. The restructuring of Dr. Irani's agreement
eliminated his unilateral right to terminate the agreement upon a
change in control. For a summary of change of control related
provisions in Drs. Irani's and Laurance's amended and restated
agreements, see "Employment Agreements" at page 15.
Deductibility of Compensation
Section 162(m) of the Internal Revenue Code limits the
deduction of compensation paid to the chief executive officer and
other named executive officers to the extent the compensation of
a particular executive exceeds $1 million, unless such
compensation was based upon stock price appreciation over market
value at the date of grant
19
(in the case of stock options) or predetermined quantifiable
performance goals (in the case of other incentive compensation)
or paid pursuant to a written contract that was in effect on
February 17, 1993. Although the Committee considers the tax
consequences of its compensation decisions, it has no policy to
pay only compensation that will be deductible and gives priority
to other objectives in circumstances it deems appropriate.
Restructuring Decisions
From late 1991 until September 1997, compensation for Dr.
Irani was set under an employment agreement dated November 16,
1991 (the "Irani Agreement") that provided for a minimum annual
base salary of $1.9 million, a minimum annual bonus equal to 60
percent of base salary, a minimum annual grant of shares of
restricted stock not less in current stock value than 101 percent
of salary, plus an annual grant of stock options of at least
100,000 shares of Common Stock. The fixed cash compensation and
restricted stock has aggregated not less than $4.5 million per
year since 1992. The stated expiration date of the Irani
Agreement was November 16, 1998, but the term of the agreement
extended seven years from any point in time, unless earlier
terminated in accordance with its terms. The Irani Agreement also
provided for substantial supplemental retirement, change in
control, tax indemnity and other benefits.
In recent years, the Committee's compensation policies for
other executive officers have moved toward more performance-based
competitive terms. Because of its historic origins, the Irani
Agreement was an exception to those policies, reflecting the
desire of the Board following Dr. Hammer's death to provide
security and stability to the leadership of the Corporation. The
Committee believes that Dr. Irani has proven to be an effective
leader and has assembled a management team whose leadership and
experience is an important asset to Occidental.
Dr. Laurance has been an important part of this team. Dr.
Laurance's compensation package, from September 1993 until
September 1997, provided for a guaranteed minimum salary with a
discretionary bonus. Under this arrangement, Dr. Laurance was
paid in 1997 an annual salary of $950,000. In addition, Dr.
Laurance was eligible to participate in Occidental's incentive
plans. His employment agreement, in addition, provided for
substantial supplemental retirement benefits. As in the case of
the Irani Agreement, Dr. Laurance's employment agreement provided
for a guaranteed base salary.
In August 1997, the Committee commenced an analysis of the
existing employment agreements with Drs. Irani and Laurance in
order to determine the basis on which the agreements could be
amended to be more in line with the Corporation's compensation
philosophy. Consultants were retained to advise the Committee.
The Committee concluded that restructuring of the agreements
would meet a number of important corporate objectives, including
the following. First, the restructuring would allow the
Corporation to liquidate significant post-retirement and certain
other liabilities arising under the agreements. Second, the
restructuring would replace certain of Dr. Irani's fixed
compensation with performance-based measures, linking Dr. Irani's
compensation more directly to the performance of the Corporation.
Third, the shift to a more performance-based compensation package
would align Dr. Irani's compensation more closely with that of
the senior executive team that he has brought to the Corporation.
The Committee also sought to restructure the contractual
agreements with Drs. Irani and Laurance on a basis that was fair
to both stockholders and to the executives and that provided
sufficient incentives on a prospective basis to assure their
retention.
The Committee entered into negotiations with Drs. Irani and
Laurance to design a compensation package that would achieve the
above objectives and eliminate certain contractual rights under
the old contracts. The resulting changes reduce Dr. Irani's fixed
salary, eliminate fixed bonus and stock awards, and significantly
eliminate, for Dr. Irani, special post-employment contractual
retirement benefits. The Committee relied in its valuation of the
benefits surrendered on, among other things, actuarial data
prepared by outside consultants. The Committee also recommended
revisions to the term and benefits under Dr. Laurance's agreement
that correspond to those under Dr. Irani's amended and restated
agreement.
In consideration of the restructuring of Drs. Irani's and
Laurance's agreements, the Committee recommended the accelerated
payment of certain benefits and the liquidation of various other
contingent obligations of the Corporation that did not survive in
the amended arrangements with Drs. Irani and Laurance. Dr. Irani
received a payment of $95 million. This amount principally
represented payments to eliminate certain contractual retirement
benefits, certain tax indemnities and spousal benefits, as well
as payments related to the termination of future salary,
20
bonus and stock award guarantees under the Irani Agreement.
Dr. Laurance received a payment of $17 million. This amount
principally represented payments to eliminate certain contractual
retirement benefits, including spousal benefits, and, to a lesser
extent, payments related to the termination of future salary
guarantees under the original terms of his agreement.
In September 1997, the Board approved the Committee's
recommendations concerning the above payments and authorized
amended and restated employment agreements for Drs. Irani and
Laurance. The amended and restated agreements are summarized at
page 15.
Compensation Decisions
Through mid-September, 1997, Dr. Irani's salary was fixed
under his employment agreement at an annual rate of $1.9 million.
As discussed above, as part of the restructuring of Dr. Irani's
compensation package, his salary was reduced at that time to an
annual rate of $1.2 million.
In December 1996, the Committee made its determination with
respect to performance stock awards and restricted stock awards
granted in January 1997 under the 1995 Plan. In making its
decisions as to performance stock awards with respect to
executives other than Dr. Irani, the Committee considered each
executive's potential to impact Occidental's future performance.
Awards of restricted stock to executives other than Dr. Irani
were based on a subjective assessment of the executives'
contributions to Occidental's performance in 1996 and, as with
performance stock awards, their ability to impact future
performance. Dr. Irani's award of restricted stock was determined
by the percentage specified in his employment agreement as in
effect at the time of the award and cost of living adjustments
granted in 1994, 1995 and 1996. Dr. Irani did not receive a
performance stock award in 1997.
In July 1997, the Committee reviewed and approved stock option
awards under the 1995 Plan. Grants were based on a subjective
assessment of each executive's individual performance and
potential to contribute to Occidental's future performance. Dr.
Irani's grant of incentive and nonqualified stock options
remained at the same level as his 1997 grant. At the same time,
the Committee recognized that the level of stock option awards
generally has been conservative relative to competitive practice.
Accordingly, the Committee approved a special grant of
performance stock options for selected executives, including Dr.
Irani. These performance stock options are intended to encourage
the executives to increase stockholder value, as exercise of the
options is dependent on attainment of specified increases in the
price for the Common Stock. While Dr. Irani's option grants in
recent years have been at or near competitive levels, the
aggregate value of his grants since becoming Chairman was
conservative. Accordingly, Dr. Irani's award of performance stock
options was intended to bring his aggregate grant value on a par
with competitive practice.
Annual bonus awards for 1997 were reviewed and approved by
the Committee in February 1998. Awards under the Executive
Incentive Compensation Plan to the named executive officers other
than Dr. Irani were based on the achievement of predetermined
financial goals, including earnings per share, and the
achievement of predetermined individual goals. In addition, Mr.
Riordan and Mr. Chazen were each given special recognition for
their efforts in 1997 in connection with the sale of MidCon. Mr.
Riordan received an additional cash bonus and Mr. Chazen received
a restricted stock award. Dr. Irani's bonus was determined in the
discretion of the Committee based on the measures applied to the
corporate executives participating in the Executive Incentive
Compensation Plan and a subjective assessment of his personal
accomplishments in 1997, including the adoption of strategic
measures (such as the sale of MidCon Corp. and other nonstrategic
assets) and the total return to stockholders in 1997.
Respectfully submitted,
COMPENSATION COMMITTEE
George O. Nolley
Rosemary Tomich
Irvin W. Maloney
21
PERFORMANCE GRAPHS
-------
Set forth below are two graphs with respect to the performance
of the Common Stock compared to the peer group. The peer group
companies are Amoco Corporation, Atlantic Richfield Company
("ARCO"), Chevron Corporation, Dow Chemical Company, Georgia Gulf
Corporation, Lyondell Petrochemical Company, Mobil Corporation,
Occidental, Phillips Petroleum Company, Texaco Inc. and Union
Carbide Corporation.
The first graph compares the yearly percentage change in the
cumulative total return of the Common Stock with the cumulative
total return of the Standard & Poor's 500 Stock Index and with
that of the peer group over the five-year period ending on
December 31, 1997. It is assumed in the first graph that $100 was
invested in the Common Stock, in the stock of the companies in
the Standard & Poor's 500 Index and in the stocks of the peer
group companies just prior to the commencement of the period
(December 31, 1992) and that all dividends received within a
quarter were reinvested in that quarter.
COMPARISON OF FIVE-YEAR CUMULATIVE TOTAL RETURN
OF OCCIDENTAL COMMON STOCK, THE S&P 500 INDEX AND SELECTED PEER
GROUP
(The table below is a tabular representation of graphic materials)
Year Oxy Stock S&P 500 Peer Group
1992 100 100 100
1993 105 110 116
1994 126 112 132
1995 146 153 165
1996 166 189 199
1997 217 252 238
The second graph shows the total return for the year ended
December 31, 1997 for the Common Stock and for each company in
the peer group. In determining total return for the second graph,
dividends were included but they were not assumed to be
reinvested.
22
1997 TOTAL RETURN OF OCCIDENTAL COMMON STOCK
AND THE SELECTED PEER GROUP
(The table below is a tabular representation of graphic materials)
Amoco ARCO Chevron Dow Georgia Lyondell
Chemical Gulf
9.1% 25.2% 22.0% 33.8% 15.1% 23.8%
Mobil Occidental Phillips Texaco Union
Petroleum Carbide
21.6% 29.7% 12.9% 14.4% 7.0%
RATIFICATION OF THE SELECTION OF INDEPENDENT
PUBLIC ACCOUNTANTS
The Audit Committee of the Board of Directors of Occidental
has selected Arthur Andersen LLP as independent public
accountants to audit the consolidated financial statements of
Occidental and its subsidiaries for the year ending December 31,
1998. Arthur Andersen LLP has audited Occidental's financial
statements annually since 1961. A member of that firm is expected
to be present at the Meeting, will have an opportunity to make a
statement if so desired and will be available to respond to
appropriate questions. If the stockholders do not ratify the
selection of Arthur Andersen LLP, if it should decline to act or
otherwise become incapable of acting or if its employment is
discontinued, the Audit Committee will appoint independent public
accountants for 1998.
The Board of Directors recommends a vote FOR the proposal to
ratify the selection of Arthur Andersen LLP as independent public
accountants for 1998. Proxies solicited by the Board of Directors
will be so voted unless stockholders specify otherwise.
APPROVAL OF AMENDMENT TO THE 1995 INCENTIVE STOCK PLAN
The Board of Directors believes that Occidental's long-
standing policy of encouraging stock ownership by its employees
through the granting of stock awards and stock options has been a
significant factor in its growth and success by enhancing
Occidental's ability to retain and attract key employees. An
important part of that policy has been the Occidental Petroleum
Corporation 1995 Incentive Stock Plan (the "1995 Plan").
Under the 1995 Plan, Occidental is authorized to issue
10,000,000 shares of Common Stock in the form of restricted stock
awards and performance stock awards or upon exercises of stock
options or stock appreciation rights ("SARs"). However, as a
result of the prior grant of stock awards and stock options under
the 1995 Plan to employees of Occidental and its subsidiaries,
the number of shares currently available for such grants has been
23
(NOTE: In the second paragraph on this page, brackets indicate language that
has been stricken through, and parentheses indicate language that has
been underlined.)
reduced to 1,470,742. The Board of Directors has determined
that this number is insufficient to maintain the 1995 Plan as an
incentive device over the term of the 1995 Plan, which expires,
unless earlier terminated, in 2005 and has adopted, and proposes
that the stockholders approve, amendments to the 1995 Plan (i) to
increase the number of shares of Common Stock covered by the 1995
Plan from 10,000,000 to 15,000,000, thereby restoring the number
of shares available for grant to 6,470,742; (ii) to increase the
maximum number of shares that may be issued upon exercise of
incentive stock options from 10,000,000 shares to 15,000,000
shares, subject to adjustment as provided in Section 9 of the
1995 Plan; and (iii) to increase the maximum number of shares
that may be awarded to any participant from 2,000,000 shares to
3,000,000 shares, subject to adjustment as provided in Section 9
of the 1995 Plan.
A description of the 1995 Plan, including the proposed changes
from the amendments, is set forth below. The full text of the
1995 Plan as proposed to be amended is set forth in Exhibit A and
the following summary is qualified in its entirety by reference
to Exhibit A. In Exhibit A, the materials that would be deleted
from the plan are [stricken through],and the materials that would
be added by the proposed amendments are (underlined). If these
amendments are not approved by the stockholders, the 1995 Plan
will continue in effect under the present terms.
SHARES AVAILABLE UNDER THE 1995 PLAN
-------
Subject to adjustment as provided in the 1995 Plan, 10,000,000
shares of Common Stock were originally authorized for issuance
pursuant to awards made under the 1995 Plan, and 1,470,742 shares
remain available for awards. The number of shares issued or
transferred as restricted stock or performance stock that become
nonforfeitable without the achievement of performance objectives
(see description below under "Performance Stock") may not in the
aggregate exceed 5,000,000 shares. Currently, no single
individual may be granted awards in the aggregate for more than
2,000,000 shares. However, if the amendments are approved this
limit will be increased to 3,000,000 shares.
If an award is canceled or terminated, lapses unexercised or
is satisfied in cash, any unissued shares allocated to such award
may be subjected again to an award. If shares of restricted stock
or performance stock are reacquired by Occidental, such shares
may again be subjected to an award under the 1995 Plan. If the
option price is paid by transferring shares of Common Stock to
Occidental or if any tax withholding obligations for an award are
satisfied by transferring or relinquishing shares of Common
Stock, only the net number of shares of Common Stock will be
deemed to have been issued or transferred.
The Committee may make adjustments in the price and number and
kind of shares that may be issued under the 1995 Plan to prevent
dilution or expansion of participants' rights in the event (i)
any stock dividend, stock split, combination of shares,
recapitalization or other change in the capital structure of
Occidental or (ii) any merger, consolidation, spin-off,
reorganization, partial or complete liquidation or other
distribution of assets, issuance of warrants or other rights to
purchase securities or any other corporate transaction or event
having a similar effect. In addition, the Committee may make
adjustments in the maximum number of shares of Common Stock
specified for issuance under the 1995 Plan in order to reflect
any of the foregoing transactions or events.
The Common Stock is traded on the New York Stock Exchange, and
on March 6, 1998, the closing price was $25.8125.
ELIGIBILITY
All present and future salaried employees of Occidental are
eligible to receive awards under the 1995 Plan. Occidental has
approximately 7,700 salaried employees (16 of whom are executive
officers).
24
ADMINISTRATION
The Compensation Committee of the Board of Directors
administers the 1995 Plan. This Committee consists of at least
two directors of Occidental, each of whom must be a
"disinterested person" within the meaning of Rule 16b-3 under the
Securities Exchange Act of 1934, as amended (the "Exchange Act"),
or any successor rule ("Rule 16b-3"), and an "outside director"
within the meaning of Section 162(m) of the Internal Revenue
Code.
The Committee has full authority to interpret the 1995 Plan
and any agreement or document evidencing the grant of any award
under the 1995 Plan. The Committee determines when to grant
awards, which employees will receive awards, the type of award,
whether SARs will be attached to stock options and the number of
shares to be allocated to each award. Awards may be granted
singly, in combination or in tandem and may be made in
combination or in tandem with, in replacement of or as the
payment form for, grants or rights under any other compensation
plan or individual contract or agreement with Occidental. The
Committee may provide in an award for the payment to the
participant of dividend or dividend equivalents, in cash or
common stock on a current, deferred or contingent basis. In
addition, the Committee may also provide in an award for earlier
exercise, vesting or termination in the event of a change of
control (see "Change of Control" below). The Committee is also
expressly authorized to make an award under the 1995 Plan
conditioned upon the surrender or deferral of a participant's
right to receive a cash bonus or other compensation. However,
without stockholder approval, the Committee may not cancel and
replace outstanding stock options or SARs with awards having a
lower option price or base price.
STOCK OPTIONS
The Committee may grant stock options to purchase shares of
Common Stock under the 1995 Plan that are either tax-qualified
options or nonqualified stock options. Tax-qualified options,
including incentive stock options, qualify for favorable income
tax treatment under Section 422 of the Internal Revenue Code,
while nonqualified stock options do not. Stock options may be
exercised only at such times as may be specified by the
Committee, and any grant of stock options may specify performance
objectives (see description below under "Performance Stock"),
which, if achieved, will result in exercisability or early
exercisability. However, no stock option may be exercised more
than 10 years from the date of the grant. The option price of
Common Stock covered by a stock option may not be less than 100
percent of the fair market value of the Common Stock on the date
of the stock option grant. If the stock option so provides, an
optionee exercising a stock option may pay the option price in
cash, check, unrestricted Common Stock already owned by the
optionee, any other legal consideration that the Committee may
deem appropriate and any combination of the foregoing or by
delivering an exercise notice together with a copy of irrevocable
instructions to a broker to promptly deliver to the company the
amount of sale or loan proceeds from the Common Stock underlying
the stock option. The Committee has the authority to specify at
the time stock options are granted that Common Stock will not be
accepted in payment of the option price until it has been owned
by the optionee for a specified period; however, the 1995 Plan
does not require any such holding period and would permit
immediate sequential exchanges of Common Stock at the time of
exercise of stock options.
SARs
The Committee may award SARs under the 1995 Plan that are
either freestanding or in tandem with stock options. When a SAR
is exercisable, the holder may surrender to Occidental all or a
portion of this unexercised SAR and receive in exchange an amount
equal to up to 100 percent of the difference between (i) the fair
market value on the date of the exercise of the Common Stock
covered by the surrendered portion of the SAR and (ii) the
exercise price of the Common Stock under the tandem option or, in
the case of a freestanding SAR, the base price determined by the
Committee for the SAR. The Committee may limit the amount that
can be received when a SAR is exercised. When a SAR related to a
stock option is exercised, the underlying option, to the extent
surrendered, will no longer be exercisable. Similarly, when a
stock option is exercised, any SARs attached to the stock option
will no longer be exercisable. SARs may only be exercised when
the underlying option is exercisable or, if there is no
underlying option, at such times as may be specified by the
Committee but, in any event, no more than 10 years from the date
of the grant. Any grants of SARs may specify performance
objectives which, if achieved, will result in exercisability or
early exercisability of such SARs.
25
RESTRICTED STOCK
The Committee may grant an award in shares of Common Stock or
denominated in share units ("restricted stock"). The grant may be
made without additional consideration or for consideration in an
amount that is less than the market value of the shares on the
date of grant, as the Committee may determine. Each award of
restricted stock will be subject to a "substantial risk of
forfeiture" within the meaning of Section 83 of the Internal
Revenue Code for a period of at least three years as determined
by the Committee. The Committee may also impose further
restrictions on restricted stock awards, including additional
events of forfeiture. The Committee will establish as to each
share of restricted stock awarded under the 1995 Plan the terms
and conditions upon which the restrictions on such shares shall
lapse. During the period of restriction, participants in whose
name shares of restricted stock are issued at the time of grant
may exercise full voting rights with respect to those shares and
are entitled to receive all dividends and other distributions
paid with respect to those shares. For grants for which shares of
Common Stock are not issued at the time of grant, the award will
specify the time and manner of payment of restricted stock that
has ceased to be forfeitable.
PERFORMANCE STOCK
The Committee may grant an award denominated in shares of
Common Stock or in share units ("performance stock") that shall
become either nonforfeitable or payable upon the achievement of
specified performance objectives. Each grant of performance stock
will specify the performance objectives to be achieved and set
forth a formula for determining the amount of performance stock
to be issued or payment to be made depending on the level of
achievement. In addition, each grant of performance stock will
specify a minimum level of achievement below which the entire
grant of performance stock will be forfeited or no payment will
be made. For participants who are, or who are likely to be,
"covered employees" within the meaning of Section 162(m) of the
Internal Revenue Service Code, the performance objectives to be
used for awards of performance stock shall be limited to
specified levels of, growth in or peer company comparisons based
on either total stockholder return, return on assets or book
value per share. Except in the case of such a covered employee,
if the Committee determines that a change in the business,
operations, corporate or capital structure of Occidental or other
events or circumstances render the performance objectives
unsuitable, the Committee may modify such performance objectives
or the related minimum acceptable level of achievement as the
Committee deems appropriate. The Committee will set a period of
not less than three years within which the performance objectives
are to be achieved. For grants which shares of Common Stock are
not issued at the time of grant, the award shall specify the time
and manner of payment.
CHANGE OF CONTROL
The Committee may, in its discretion, include provisions in
awards granted under the 1995 Plan that will provide for earlier
exercise, vesting or termination in the event of a Change of
Control. The definition of "Change of Control" is set forth in
Section 17 of the 1995 Plan, which is attached as Exhibit A.
SETTLEMENTS AND DEFERRALS
Payment of awards under the 1995 Plan may be in the form of
cash, Common Stock or any combination thereof. The Committee also
may require or permit participants to elect to defer the issuance
of Common Stock or the settlement of awards in cash. The
Committee may provide that deferred settlements include the
payment or crediting of interest on deferral amounts or the
payment or crediting of dividend equivalents on deferral amounts
that are denominated in stock.
TRANSFERABILITY OF AWARDS
The Committee may provide that any Common Stock issued under
the 1995 Plan will be subject to further restrictions on transfer
after any risk of forfeiture of restrictions on transferability
on the award have lapsed. In
26
general, options, SARs or other derivative securities within
the meaning of Rule 16b-3 granted under the 1995 Plan may not be
transferred other than by will or by the laws of descent and
distribution. However, the Committee may provide for the
transferability of particular awards.
AMENDMENTS
The Committee may amend, alter or discontinue the 1995 Plan.
However, no amendment, alteration or discontinuation may be made
that would impair the rights of a participant under an
outstanding award without such participant's consent or that,
without stockholder approval, would, except as described above
under "Shares Available Under the 1995 Plan," increase the total
number of shares of stock reserved for the purpose of the 1995
Plan or extend the maximum period for exercising stock options or
freestanding SARs. Notwithstanding the foregoing, stockholder
approval is required only at such time and under such
circumstances as stockholder approval is required under Rule 16b-
3 with respect to any material amendment to an employee benefit
plan.
FEDERAL INCOME TAX CONSEQUENCES
The following is a brief summary of certain of the federal
income tax consequences of certain transactions under the 1995
Plan based on federal income tax laws in effect on January 1,
1998. This summary is not intended to be exhaustive and does not
describe state or local tax consequences.
Tax Consequences to Participants
In general, a participant will not incur federal income tax
when he is granted a nonqualified stock option, an incentive
stock option or a SAR. Upon exercise of a nonqualified option or
a SAR, a participant generally will recognize ordinary
compensation income, which is subject to income tax withholding
by Occidental, equal to the difference between the fair market
value of the Common Stock on the date of the exercise and the
option price. When a participant exercises an incentive stock
option, he generally will not incur federal income tax, unless he
is subject to the alternative minimum tax.
If shares are issued pursuant to the exercise of an incentive
stock option and no disqualifying disposition of the shares is
made within two years after the date of grant of the option or
within one year after the transfer of the shares to the optionee,
then upon the sale of the shares any amount realized in excess of
the option price will be taxed to the optionee as a long-term
capital gain and any loss sustained will be a long-term capital
loss. If shares acquired upon the exercise of an incentive stock
option are disposed of prior to the expiration of either holding
period, the optionee generally will recognize ordinary income in
the year of disposition in an amount equal to any excess of the
fair market value of the shares at the time of exercise (or, if
less, the amount realized on the disposition of the shares in the
sale or exchange) over the option price paid for the shares.
In general, a participant will not incur federal income tax
when restricted stock or performance stock is granted. A
participant will include in his gross income as compensation
income an amount equal to the amount of cash received and the
fair market value of the restricted stock or performance stock
received at the time the restrictions lapse or are removed or the
performance objectives are achieved. Such amount will be included
in income in the tax year in which such event occurs. The income
recognized will be subject to income tax withholding by
Occidental.
In limited circumstances where the sale of stock that is
received as the result of a grant of an award could subject an
officer to suit under Section 16(b) of the Exchange Act, the tax
consequences to the officer may differ from the tax consequences
described above. In these circumstances, unless a special
election has been made, the principal difference usually will be
to postpone valuation and taxation of the stock received so long
as the sale of the stock received could subject the officer to
suit under Section 16(b) of the Exchange Act, but no longer than
six months.
27
Tax Consequences to Occidental
Occidental usually will be entitled to a business expense
deduction at the time and in the amount that the recipient of an
award recognizes ordinary compensation income in connection
therewith. No deduction is allowed in connection with an
incentive stock option unless the employee disposes of Common
Stock received upon exercise in violation of the holding period
requirements. Moreover, there can be circumstances when
Occidental may not be entitled to a deduction for certain
transfers of Common Stock or payments to a participant where
vesting or payment of an award has been accelerated as a result
of a Change of Control.
In addition to the limitations described above in Occidental's
right to a corresponding business expense deduction, the tax law
also imposes a $1 million limitation on the amount of annual
compensation deduction allowable to a publicly held company in
respect of its chief executive officer and its other four most
highly paid executive officers. An exception is provided for
certain performance-based compensation if certain stockholder
approval, outside director administration and other requirements
are satisfied. Because the 1995 Plan was approved by the
stockholders, awards may be, but are not required to be,
structured so as to qualify as performance-based compensation
that is not subject to the limitation.
The Board of Directors recommends a vote FOR the proposal to
amend the 1995 Plan. Proxies solicited by the Board of Directors
will be so voted unless stockholders specify otherwise.
STOCKHOLDER PROPOSAL
Occidental has been advised by one holder of Common Stock of
his intention to introduce at the Meeting the proposal and
supporting statement set forth below. The Board of Directors
disclaims any responsibility for the content of the proposal and
for the statement made in support thereof, which is presented as
received from the stockholder.
Stockholder Proposal Regarding Maximizing Value
-------
Dr. Charles Miller, 23 Park Circle, Great Neck, New York
11024, the owner of 200 shares of Common Stock, has notified
Occidental that he intends to present the following proposal at
the Meeting:
"Resolved that the shareholders of Occidental Petroleum
Corporation urge the Board of Directors to arrange for the prompt
sale of the Company to the highest bidder."
Supporting Statement
"The purpose of the Maximize Value Resolution is to give all
Occidental shareholders the opportunity to send a message to the
Occidental Board that they support the prompt sale of the Company
to the highest bidder. Even if it is approved by the majority of
the Occidental shares represented and entitled to vote at the
Annual Meeting, the Maximize Value Resolution will not be binding
on the Occidental Board. However, I believe that if this
resolution receives substantial support from the shareholders,
the Board may choose to carry out the request set forth in this
resolution.
The prompt auction of Occidental Petroleum should be
accomplished by any appropriate strategy the Board chooses to
adopt, including a sale to the highest bidder whether in cash,
stock, or a combination of both. It is expected that the Board
will fulfill its fiduciary duties to the utmost during this
course of action.
I further believe that if the current resolution is approved
by the majority of Occidental shareholders, it sends a clear
message to the company's management and Board that shareholders
no longer find it acceptable for the management and Board to
continue with their current strategies and overall direction of
the corporation.
28
I believe that the management and Board of Directors of
Occidental Petroleum have demonstrated a long history of, at
best, indifference and at worst, contempt for shareholder
interest. This view has been well documented in a variety of well
known publications. The latest insult, in my opinion, has been
the egregious buyout contract of management, rationalized by the
opportunity to terminate an equally outrageous previous contract.
To quote Graef S. Crystal, a well known corporate compensation
consultant, "Occidental is giving Ray Irani the best of all
worlds, and he's a lousy performer...I've never seen a contract
this outrageous before." Laudatory Company statements that
current management has done a yeoman's job in removing a
significant burden of debt left by Mr. Irani's predecessor, fail
to note that many of the current Board members and management
were also key players during the previous regime.
By supporting this resolution, I contend, shareholders will
end a legacy of self-serving management and director somnolence."
The Board of Directors' Statement in Opposition to the Foregoing
Stockholder Proposal
The Board of Directors is aware of its fiduciary obligations
to act in the best interests of the Corporation's stockholders
and is open to all types of initiatives to build stockholder
value. In recent years, the Board has eliminated measures, such
as the poison pill and the classified Board, that could limit the
possibility of a merger or acquisition. However, the Board does
not believe that putting the Corporation on the auction block is
likely to result in maximizing stockholder value. Moreover, the
uncertain atmosphere that could result from the adoption of a
proposal that urges such action might result in damage to
customer and vendor relationships and the possible loss of key
employees which might jeopardize stockholder value. At the
present time, the Board believes that stockholder value will be
maximized by the implementation of the strategic actions
announced by Occidental in late 1997. These actions include,
among other things, the acquisition of the U.S. government's
interest in the Elk Hills Naval Petroleum Reserve, the sale of
MidCon Corp., Occidental's natural gas transmission and marketing
subsidiary, the repurchase of up to 40 million shares of the
Common Stock and the sale of additional nonstrategic assets. In
addition, a large portion of executive compensation is now tied
directly to corporate performance and stockholder value. The
Board believes that these actions will transform Occidental into
a simpler company with higher growth potential and higher
stockholder value.
Accordingly, the Board of Directors recommends a vote AGAINST
the foregoing stockholder proposal. Proxies solicited by the
Board of Directors will be so voted unless stockholders specify
otherwise.
STOCKHOLDER PROPOSALS FOR THE 1999 ANNUAL MEETING
OF STOCKHOLDERS
Stockholder proposals to be presented at the 1999 Annual
Meeting of Stockholders of Occidental must be received at
Occidental's executive offices at 10889 Wilshire Boulevard, Los
Angeles, California 90024, addressed to the attention of the
Secretary, by November 17, 1998, in order to be included in the
proxy statement and form of proxy relating to such meeting.
29
ANNUAL REPORT
Occidental's 1997 Annual Report is concurrently being mailed
to stockholders. The Annual Report contains consolidated
financial statements of Occidental and its subsidiaries and the
report thereon of Arthur Andersen LLP, independent public
accountants.
Sincerely,
DONALD P. DE BRIER
Los Angeles, California Donald P. de Brier
March 17, 1998 Secretary
IT IS IMPORTANT THAT PROXIES BE RETURNED PROMPTLY. THEREFORE,
STOCKHOLDERS ARE URGED TO COMPLETE, SIGN, DATE AND RETURN THE
ACCOMPANYING FORM OR FORMS OF PROXY IN THE ENCLOSED ENVELOPE.
30
(NOTE: Bracketed figures indicate figures that are stricken through. Figures
in parentheses indicate figures that are underlined.)
EXHIBIT A
1995 INCENTIVE STOCK PLAN, AS AMENDED THROUGH FEBRUARY 12, 1998
AND AS PROPOSED TO BE AMENDED
1. Purpose. The purpose of this Occidental Petroleum
Corporation 1995 Incentive Stock Plan is to permit Occidental
Petroleum Corporation ("Occidental") and its subsidiaries to
attract and retain top-quality employees and to provide such
employees with an incentive to enhance stockholder return.
Additionally, it is intended that by providing more compensation
that is stock-based, the Plan will encourage employees to view
Occidental from the perspective of its stockholders.
2. Common Stock Authorized Under the Plan.
(a) Subject to adjustment as provided in Section 9 the
number of shares of Common Stock issued or transferred under this
Plan shall not in the aggregate exceed [10,000,000] (15,000,000)
shares, which may be Common Stock of original issuance or Common
Stock held in treasury or a combination thereof. For the
purposes of this Section 2(a):
(i) Upon payment in cash of the benefit provided by
any Award, any shares of Common Stock that were covered by that
Award shall again be available for issuance or transfer under
this Plan.
(ii) Upon the full or partial payment of any Option
Price by the transfer to the Company of shares of Common Stock
or upon satisfaction of tax withholding obligations in connection
with any such exercise or any other payment made or benefit
realized under this Plan by the transfer or relinquishment of
Common Stock, there shall be deemed to have been issued or
transferred under this Plan only the number of shares of Common
Stock actually issued or transferred by Occidental less the
number of Common Stock so transferred or relinquished.
(b) Notwithstanding anything in Section 2(a) or
elsewhere in this Plan to the contrary, the number of shares of
Common Stock issued or transferred as Restricted Stock and
Performance Stock that become nonforfeitable without the
achievement of Performance Objectives shall not in the aggregate
exceed 5,000,000 shares, subject to adjustment as provided in
Section 9.
(c) Notwithstanding anything in Section 2(a) or
elsewhere in this Plan to the contrary, the aggregate number of
shares of Common Stock which may be issued by the Company upon
the exercise of Incentive Stock Options shall not exceed
[10,000,000] (15,000,000) shares of Common Stock, subject to
adjustment as provided in Section 9.
(d) Subject to adjustment as provided in Section 9, no
Participant shall be granted Stock Options, SARs, Restricted
Stock, Performance Stock and any other Award paid in Common
Stock, in the aggregate, for more than [2,000,000] (3,000,000)
shares.
3. Awards. The Committee shall determine the type of
Award(s) to be made to a Participant. Awards may be granted
singly, in combination or in tandem. Awards also may be made in
combination or in tandem with, in replacement of or as
alternatives to or as the payment form for grants or rights under
any other compensation plan or individual contract or agreement
with the Company. The types of Awards that may be granted are
set forth in Sections 4, 5, 6 and 7. Each Award shall be
evidenced by a written agreement signed by the Company and the
Participant. The following terms and conditions shall apply to
all Awards:
(a) An Award may provide for the payment to the
Participant of dividends or dividend equivalents, in cash or
Common Stock on a current, deferred or contingent basis.
(b) Any Award may provide for earlier exercise,
vesting or termination in the event of a Change of Control.
(c) Successive Awards may be made to the same
Participant regardless of whether any outstanding Award remains
unexercised or subject to the expiration of restrictions or the
satisfaction of Performance Objectives.
31
4. Stock Options. The Committee may from time to time
authorize grants to Participants of options to purchase Common
Stock upon such terms and conditions as the Committee may
determine in accordance with the following provisions:
(a) Each grant shall specify the number of shares of
Common Stock to which it pertains.
(b) Each grant shall specify an Option Price, which
may be either fixed or based on an index, but which, in any case,
shall be not less than the Fair Market Value per Share on the
Date of Grant.
(c) Each grant shall specify the form of consideration
to be paid in satisfaction of the Option Price, which may include
(i) cash in the form of currency or check or other cash
equivalent acceptable to the Company, (ii) unrestricted Common
Stock already owned by the Optionee, (iii) any other legal
consideration that the Committee may deem appropriate on such
basis as the Committee may determine in accordance with this Plan
and (iv) any combination of the foregoing or (v) the delivering
of an exercise notice together with a copy of irrevocable
instructions to a broker to promptly deliver to the company the
amount of sale or loan proceeds from the Common Stock underlying
the stock option.
(d) Each grant shall specify the period or periods of
continuous employment of the Optionee by the Company that are
necessary before the Stock Options or installments thereof become
exercisable.
(e) Stock Options granted pursuant to this Section 4
may be Nonqualified Options or Tax-qualified Options or
combinations thereof.
(f) Any grant of Stock Options may specify Performance
Objectives that, if achieved, will result in exercisability or
early exercisability of such Stock Option.
(g) No Stock Option granted pursuant to this Section 4
may be exercised more than 10 years from the Date of Grant.
5. Stock Appreciation Rights ("SARs"). The Committee may
also authorize grants to Participants of SARs. A SAR shall be a
right of the Participant to receive from the Company an amount,
which shall be determined by the Committee and shall be expressed
as a percentage (not exceeding 100 percent) of the Spread at the
time of the exercise of a SAR. Any grant of SARs shall be upon
such terms and conditions as the Committee may determine in
accordance with the following provisions:
(a) Any grant may specify that the amount payable upon
the exercise of a SAR may be paid by the Company in cash, Common
Stock or any combination thereof and may (i) either grant to the
Participant or reserve to the Committee the right to elect among
those alternatives or (ii) preclude the right of the Participant
to receive and the Company to issue Common Stock or other equity
securities in lieu of cash.
(b) Any grant may specify that the amount payable upon
the exercise of a SAR shall not exceed a maximum specified by the
Committee on the Date of Grant.
(c) Any grant may specify (i) a waiting period or
periods before SARs shall become exercisable and (ii) permissible
dates or periods on or during which SARs shall be exercisable.
(d) Any grant of SARs may specify Performance
Objectives that, if achieved, will result in exercisability or
early exercisability of such SARs.
(e) Any SAR may be granted in tandem with a Stock
Option. Each tandem grant shall provide that a SAR may be
exercised only (i) if the related Stock Option is exercisable and
(ii) by surrender of the related Stock Option for cancellation.
(f) Regarding freestanding SARs only:
(i) Each grant shall specify in respect of each
freestanding SAR a Base Price, which shall be not less than the
Fair Market Value per Share on the Date of Grant.
(ii) Each grant shall specify the period or periods of
continuous employment of the Participant by the Company that are
necessary before the freestanding SAR or installments thereof
shall become exercisable.
32
(iii) No freestanding SAR granted may be exercised
more than 10 years from the Date of Grant.
6. Restricted Stock. The Committee may also authorize
grants or sales to Participants of Restricted Stock upon such
terms and conditions as the Committee may determine in accordance
with the following provisions:
(a) Each grant or sale shall specify the number of
shares of Restricted Stock to which it relates.
(b) Each grant or sale may be made without additional
consideration from the Participant or in consideration of a
payment by the Participant that is less than the Fair Market
Value per Share on the Date of Grant.
(c) Each grant or sale shall provide that the
Restricted Stock covered thereby shall be subject to a
"substantial risk of forfeiture" within the meaning of Section 83
of the Code for a period of at least three years as determined by
the Committee.
(d) Each grant or sale shall provide that, during the
Restricted Period, the transferability of the Restricted Stock
shall be prohibited or restricted in the manner and to the extent
prescribed by the Committee.
(e) For grants or sales for which forfeitable shares
of Common Stock are issued at the time of grant or sale:
(i) Each such grant or sale shall constitute a
transfer of ownership of Restricted Stock to the Participant in
consideration of the performance of services, entitling such
Participant to dividend, voting and other ownership rights,
subject to the substantial risk of forfeiture and restrictions on
transfer provided above in Section 6(c).
(ii) Unless otherwise directed by the Committee, all
certificates representing Restricted Stock, together with a stock
power endorsed in blank by the Participant, shall be held in
custody by the Company until all restrictions on such Stock
lapse.
(f) For grants for which forfeitable shares of Common
Stock are not issued at the time of grant, each grant shall
specify the time and manner of payment of Restricted Stock that
shall have ceased to be forfeitable, and any grant may specify
that any such amount may be paid by the Company in cash, Common
Stock or any combination thereof and may either grant to the
Participant or reserve to the Committee the right to elect among
those alternatives.
7. Performance Stock. The Committee may also authorize
grants of Performance Stock, which shall become either
nonforfeitable or payable to the Participant upon the achievement
of specified Performance Objectives, upon such terms and
conditions as the Committee may determine in accordance with the
following provisions:
(a) Each grant shall specify the number of shares of
Performance Stock to which it pertains, which may be subject to
adjustment to reflect changes in compensation or other factors.
(b) The Performance Period with respect to each grant
of Performance Stock shall be determined by the Committee.
(c) Each grant shall specify the Performance
Objectives that are to be achieved and a minimum acceptable level
of achievement below which no payment will be made or grant of
Performance Stock shall be nonforfeitable and shall set forth a
formula for determining the amount of any payment to be made or
amount of Performance Stock to be nonforfeitable if performance
is at or above the minimum acceptable level but falls short of
full achievement of the Performance Objectives.
(d) For grants for which forfeitable shares of Common
Stock are not issued at the time of grant, each grant shall
specify the time and manner of payment of Performance Stock that
shall have been earned, and any grant may specify that any such
amount may be paid by the Company in cash, Common Stock or any
combination thereof and may either grant to the Participant or
reserve to the Committee the right to elect among those
alternatives.
33
(e) Any grant of Performance Stock may specify that
the amount payable with respect thereto may not exceed a maximum
specified by the Committee on the Date of Grant.
8. Transferability.
(a) Any Award may provide that all or any part of the
Common Stock that is to be issued or transferred by Occidental
upon the exercise of Stock Options or SARs or in payment of
Performance Stock or that, in the case of Restricted Stock or
Performance Stock, is no longer subject to substantial risk of
forfeiture and restrictions on transfer shall be subject to
further restrictions upon transfer.
(b) No Stock Option or other derivative security (as
that term is used in Rule 16b-3) granted under this Plan may be
transferred by a Participant except by will or the laws of
descent and distribution. Notwithstanding the foregoing, the
Committee, at its sole discretion, may provide for the
transferability of particular Awards under the Plan.
9. Adjustments.
(a) The Committee may make or provide for such
adjustments in the number of shares of Common Stock covered by
outstanding Stock Options, SARs and Performance Stock granted
under this Plan, the Option Prices or Base Prices applicable to
any such Stock Options and SARs and the kind of shares (including
shares of another issuer) covered thereby, as the Committee may
in good faith determine to be required in order to prevent
dilution or expansion of the rights of Participants that
otherwise would result from (i) any stock dividend, stock split,
combination of shares, recapitalization or other change in the
capital structure of the Company or (ii) any merger,
consolidation, spin-off, spin-out, split-off, split-up,
reorganization, partial or complete liquidation or other
distribution of assets, issuance of warrants or other rights to
purchase securities or any other corporate transaction or event
having an effect similar to any of the foregoing. In the event
of any such transaction or event, the Committee may provide in
substitution for any or all outstanding Awards under this Plan
such alternative consideration as it may in good faith determine
to be appropriate under the circumstances and may require the
surrender of all Awards so replaced. Moreover, the Committee may
on or after the Date of Grant provide in the agreement evidencing
any Award that the holder of the Award may elect to receive an
equivalent Award in respect of securities of the surviving entity
of any merger, consolidation or other transaction or event having
a similar effect, or the Committee may provide that the holder
will automatically be entitled to receive such an equivalent
Award. The Committee may also make or provide for such
adjustments in the maximum number of shares of Common Stock
specified in Sections 2(a), 2(b), 2(c) and 2(d) as the Committee
may in good faith determine to be appropriate in order to reflect
any transaction or event described in this Section 9.
Notwithstanding anything in the foregoing to the contrary, with
respect to any outstanding Stock Option that was intended to
qualify as a Tax-qualified Option, the Committee shall not,
without the consent of the affected Participant, make any
adjustment that would prevent such Stock Option from so
qualifying.
(b) If another corporation is merged into the Company
or the Company otherwise acquires another corporation, the
Committee may elect to assume under this Plan any or all
outstanding stock options or other awards granted by such
corporation under any stock option or other plan adopted by it
prior to such acquisition. Such assumptions shall be on such
terms and conditions as the Committee may determine; provided,
however, that the awards as so assumed do not contain any terms,
conditions or rights that are inconsistent with the terms of this
Plan. Unless otherwise determined by the Committee, such awards
shall not be taken into account for purposes of the limitations
contained in Section 2 of this Plan.
10. Fractional Shares. The Company shall not be required
to issue any fractional shares of Common Stock pursuant to this
Plan. The Committee may provide for the elimination of fractions
or for the settlement thereof in cash.
11. Withholding Taxes. To the extent that the Company is
required to withhold federal, state, local or foreign taxes in
connection with any payment made or benefit realized by a
Participant or other person under this Plan, it shall be a
condition to the receipt of any such payment or the realization
of any such benefit that the Participant or such other person
make arrangements satisfactory to the Company for payment of any
taxes required to be withheld. At the discretion of the
Committee, any such arrangements may without limitation include
relinquishment of a portion of any such payment or benefit or the
surrender of outstanding Common Stock, and any agreement
pertaining to an Award may make such relinquishment the mandatory
form of satisfying such taxes. The
34
Committee may also make similar arrangements with respect to
the payment of any taxes with respect to which withholding is not
required.
12. Termination of Employment, Hardship and Approved
Leaves of Absence. Notwithstanding any other provision of this
Plan to the contrary, in the event of termination of employment
for any reason, leave of absence approved by the Company, or in
the event of hardship or other special circumstances, of a
Participant who holds a Stock Option or SAR that is not
immediately and fully exercisable, any Restricted Stock as to
which the substantial risks of forfeiture or the prohibition or
restriction on transfer has not lapsed, any Performance Stock
that has not been fully earned or is subject to forfeiture or any
Common Stock that is subject to any transfer restriction pursuant
to Section 8(a) of this Plan, the Committee may take any action
that it deems to be appropriate under the circumstances or in the
best interests of the Company, including without limitation
waiving or modifying any limitation or requirement with respect
to any Award.
13. Foreign Participants. In order to facilitate the
making of an Award, the Committee may provide for such special
terms for Awards to Participants who are foreign nationals, or
who are employed by the Company outside of the United States of
America, as the Committee may consider necessary or appropriate
to accommodate differences in local law, tax policy or custom.
Moreover, the Committee may approve such supplements to, or
amendments, restatements or alternative versions of, this Plan as
it may consider necessary or appropriate for such purposes
without thereby affecting the terms of this Plan as in effect for
any other purpose, and the Secretary or other appropriate officer
of Occidental may certify any such document as having been
approved and adopted in the same manner as this Plan; provided,
however, that no such supplements, amendments, restatements or
alternative versions shall include any provisions that are
inconsistent with the terms of this Plan, as then in effect,
unless this Plan could have been amended to eliminate the
inconsistency without further approval by the stockholders of
Occidental.
14. Administration of the Plan.
(a) This Plan shall be administered by the
Compensation Committee of the Board, which shall be composed of
not less than two members of the Board, each of whom shall be a
"disinterested person" within the meaning of Rule 16b-3 and an
"outside director" within the meaning of Section 162(m) of the
Code.
(b) The interpretation and construction by the
Committee of any provision of this Plan or any agreement,
notification or document evidencing the grant of Stock Option,
SARs, Restricted Stock or Performance Stock, and any
determination by the Committee pursuant to any provision of this
Plan or any such agreement, notification or document, shall be
final and conclusive. No member of the Committee shall be liable
for any such action taken or determination made in good faith.
15. Amendments and Other Matters.
(a) The Committee may amend, alter or discontinue this
Plan, but no amendment, alteration or discontinuation shall be
made that would impair the rights of a Participant under any
outstanding Award without such Participant's consent, or that
without the approval of the stockholders of Occidental (as
described below) would (i) except as provided in Section 9,
increase the total number of shares of Common Stock reserved for
the purpose of the Plan; (ii) extend the maximum period provided
in Section 4(g) for exercising Stock Options; or (iii) extend the
maximum period provided in Section 5(f)(iii) for SARs.
Notwithstanding the foregoing, stockholder approval under this
Section 15 shall be required only at such time and under such
circumstances as stockholder approval would be required under
Rule 16b-3 with respect to any material amendment to any employee
benefit plan of the Company.
(b) The Committee shall not, without the approval of
the stockholders of Occidental, authorize the amendment of any
outstanding Stock Option to reduce the Option Price or authorize
the amendment of any outstanding SAR to reduce the Base Price.
Furthermore, no Stock Options or SARs shall be canceled and
replaced with Awards having a lower Option Price or Base Price
without the further approval of the stockholders of Occidental.
(c) The Committee may condition the grant of any Award
authorized under this Plan on the surrender or deferral by the
Participant of his or her right to receive a cash bonus or other
compensation otherwise payable by the Company to the Participant.
35
(d) This Plan shall not confer upon any Participant
any right with respect to continuance of employment or other
service with the Company and shall not interfere in any way with
any right that the Company would otherwise have to terminate any
Participant's employment or other service at any time.
(e) (i) To the extent that any provision of this
Plan would prevent any Stock Option that was intended to
qualify as a Tax-qualified Option from so qualifying, any such
provision shall be null and void with respect to any such Stock
Option; provided, however, that any such provision shall remain
in effect with respect to other Stock Options, and there shall be
no further effect on any provision of this Plan.
(ii) Any Award that may be made pursuant to an
amendment to this Plan that shall have been adopted without the
approval of the stockholders of Occidental shall be null and void
as to persons subject to Section 16(a) of the Act if it is
subsequently determined that such approval was required in order
for this Plan to continue to satisfy the applicable conditions
of Rule 16b-3.
(f) The Committee may require or permit Participants
to elect to defer the issuance of Common Stock or the settlement
of Awards in cash under such rules and procedures as it may
establish under the Plan. It also may provide that deferred
settlements include the payment or crediting of interest on the
deferral amounts, or the payment or crediting of dividend
equivalents where the deferral amounts are denominated in Stock.
(g) Unless otherwise determined by the Committee,
settlements of Awards received by Participants under the Plan
shall not be deemed a part of a Participant's regular, recurring
compensation for purposes of calculating payments or benefits
from any Company benefit plan, severance program or severance pay
law of any country. Further, the Company may adopt other
compensation programs, plans or arrangements as it deems
appropriate or necessary.
(h) Unless otherwise determined by the Committee, the
Plan shall be unfunded and shall not create (or be construed to
create) a trust or a separate fund or funds. The Plan shall not
establish any fiduciary relationship between the Company and any
Participant or other person. To the extent any person holds any
rights by virtue of an Award granted under the Plan, such rights
(unless otherwise determined by the Committee) shall be no
greater than the rights of an unsecured general creditor of the
Company.
16. Term. This Plan shall be effective on the first day
immediately following the date on which the Plan is first
approved by the stockholders of Occidental and shall continue in
effect for 10 years from that date.
17. Definitions. As used in this Plan,
"Act" means the Securities Exchange Act of 1934, as amended.
"Award" means any grant of Stock Options, SARs or
Performance Stock or grant or sale of Restricted Stock under this
Plan.
"Base Price" means the price to be used as the basis for
determining the Spread upon the exercise of a freestanding SAR.
"Board" means the Board of Directors of Occidental.
"Change of Control" means the occurrence of any of the
following events:
(i) any "person," as such term is used in Sections
13(d) and 14(d) of the Act (other than the Company, any trustee
or other fiduciary holding securities under an employee benefit
plan of the Company or any company owned, directly or indirectly,
by the stockholders of Occidental in substantially the same
proportions as their ownership of the Common Stock of
Occidental), is or becomes after the effective date of the Plan
as provided in Section 16 (the "Effective Date") the "beneficial
owner" (as defined in Rule 13d-3 under the Act), directly or
indirectly, of securities of Occidental (not including in the
securities beneficially owned by such person any securities
acquired directly from Occidental or its affiliates) representing
50 percent or more of the combined voting power of Occidental's
then-outstanding securities;
(ii) during any period of two consecutive years (not
including any period prior to the Effective Date), individuals
who at the beginning of such period constitute the Board, and any
new director (other than a director designated by a person who
has entered into an agreement with the Company to effect a
transaction described in clause (i), (iii), or (iv) of this
definition) whose election by the Board or nomination for
election by
36
Occidental's stockholders was approved by a vote of at least
two thirds (2/3) of the directors then still in office who either
were directors at the beginning of the period or whose election
or nomination for election was previously so approved, cease for
any reason to constitute at least a majority of the Board; or
(iii) the stockholders of Occidental approve a merger or
consolidation of Occidental with any other corporation, other
than (A) a merger or consolidation that would result in the
voting securities of Occidental outstanding immediately prior
thereto continuing to represent (either by remaining outstanding
or by being converted into voting securities of the surviving
entity), in combination with the ownership of any trustee or
other fiduciary holding securities under an employee benefit plan
of the Company, at least 50 percent of the combined voting power
of the voting securities of Occidental or such surviving entity
outstanding immediately after such merger or consolidation or (B)
a merger or consolidation effected to implement a
recapitalization of the Company (or similar transaction) in which
no person acquires more than 50 percent of the combined voting
power of Occidental's then-outstanding securities; or
(iv) the stockholders of Occidental approve a plan of
complete liquidation of the Company or an agreement for the sale
or disposition of all or substantially all of the Company's
assets;
provided, however, that prior to the occurrence of any of the
events described in clauses (i) through (iv) above, the Board may
determine that such event shall not constitute a Change of
Control for purposes of this Plan.
"Code" means the Internal Revenue Code of 1986, as amended
from time to time.
"Committee" means the Committee described in Section 14(a)
of this Plan.
"Common Stock" means (i) shares of the Common Stock, $0.20
par value, of Occidental and (ii) any security into which Common
Stock may be converted by reason of any transaction or event of
the type referred to in Section 9.
"Company" means Occidental and its Subsidiaries,
collectively.
"Date of Grant" means the date specified by the Committee on
which an Award shall become effective, which shall not be earlier
than the date on which the Committee takes action with respect
thereto.
"Fair Market Value per Share" means the last reported sales
price of a share of Common Stock on the New York Stock Exchange -
Composite Transactions on the relevant date or, if there are no
reported sales on such date, then the last reported sales price
on the next preceding day on which such a sale is transacted.
"Incentive Stock Option" means a Stock Option that is
intended to qualify as an "incentive stock option" under Section
422 of the Code or any successor provision thereto.
"Nonqualified Option" means a Stock Option that is not
intended to qualify as a Tax-qualified Option.
"Occidental" means Occidental Petroleum Corporation, a
Delaware corporation.
"Optionee" means the person so designated in an agreement
evidencing an outstanding Stock Option.
"Option Price" means the purchase price payable upon the
exercise of a Stock Option.
"Participant" means (i) a salaried employee of the Company
who is selected by the Committee to receive benefits under this
Plan or (ii) a person who has agreed to commence salaried
employment with the Company.
"Performance Objectives" means performance objectives
adopted by the Committee pursuant to this Plan for Participants
who have received grants of Performance Stock or, when so
determined by the Committee, Stock Options, SARs or Restricted
Stock. With respect to any Award to a Participant who is, or is
determined by the Committee to be likely to become, a "covered
employee" within the meaning of Section 162(m) of the Code (or
any successor provision), the Performance Objectives shall be
limited to specified levels of growth in or peer company
comparisons based on (i) Total Stockholder Return, (ii) return on
assets or (iii) book value per share, as the Committee may
determine, and the attainment of such Performance Objective shall
not be deemed to have occurred until certified by the Committee.
Except in the case of such a covered employee, if the Committee
determines that a change in the business, operations, corporate
structure or capital structure of the Company, or the manner in
which it conducts its business, or other events or circumstances
render the Performance Objectives to be unsuitable, the
37
Committee may modify such Performance Objectives or the related
minimum acceptable level of achievement, in whole or in part, as
the Committee deems appropriate.
"Performance Period" means, in respect of Performance Stock,
the period of time within which the Performance Objectives are to
be achieved, which period shall not be less than three years.
"Performance Stock" means (i) a grant pursuant to Section 7
of shares of Common Stock, which shares are subject to forfeiture
in the event the Performance Objectives are not achieved, or (ii)
a bookkeeping entry that records the equivalent of one share of
Common Stock awarded pursuant to Section 7 that is payable upon
achievement of the Performance Objectives.
"Plan" means this Occidental Petroleum Corporation 1995
Incentive Stock Plan.
"Restricted Period" means, in respect of Restricted Stock,
the period determined by the Committee pursuant to Section 6(c).
"Restricted Stock" means (i) a grant pursuant to Section 6
of shares of Common Stock, which shares are subject to a
substantial risk of forfeiture and restrictions on transfer, or
(ii) a bookkeeping entry that records the equivalent of one share
of Common Stock awarded pursuant to Section 6 that is payable
upon expiration of the Restricted Period.
"Rule 16b-3" means Rule 16b-3, as promulgated and amended
from time to time by the Securities and Exchange Commission under
the Securities Exchange Act of 1934, or any successor rule to the
same effect.
"SAR" means a stock appreciation right granted pursuant to
Section 5.
"Spread" means, in the case of a freestanding SAR, the
amount by which the Fair Market Value per Share on the date when
the SAR is exercised exceeds the Base Price specified therein or,
in the case of a tandem SAR, the amount by which the Fair Market
Value per Share on the date when the SAR is exercised exceeds the
Option Price for the related Stock Option.
"Stock Option" means a Nonqualified Option or a Tax-
qualified Option, or both, as the case may be.
"Subsidiary" means a corporation, partnership, joint
venture, unincorporated association or other entity directly or
indirectly controlled by the Company or in which the Company has
a direct or indirect ownership or other equity interest;
provided, however, for purposes of determining whether any person
may be a Participant for purposes of any grant of Incentive Stock
Options, "Subsidiary" means any corporation in which the Company
owns or controls directly or indirectly more than 50 percent of
the total combined voting power represented by all classes of
stock issued by such corporation at the time of the grant.
"Tax-qualified Option" means a Stock Option that is intended
to qualify under particular provisions of the Code, including
without limitation an Incentive Stock Option.
"Total Stockholder Return" means the appreciation in the
price of a share of Common Stock plus reinvested dividends over a
specified period of time.
18. Governing Law and Construction.
(a) The validity, construction and effect of the Plan
and any actions taken or relating to the Plan shall be determined
in accordance with the laws of the State of Delaware and
applicable federal law.
(b) All references to Sections in this Plan are to the
Sections of the Plan. The singular includes the plural and the
plural the singular.
(Recycle Logo)
Printed on recycled paper
PROXY
THIS PROXY IS SOLICITED ON BEHALF OF
THE BOARD OF DIRECTORS
OCCIDENTAL PETROLEUM CORPORATION
DR. RAY R. IRANI, DR. DALE R. LAURANCE and AZIZ D. SYRIANI, and each of
them, with full power of substitution, are hereby authorized to represent and
to vote the shares of the undersigned in OCCIDENTAL PETROLEUM CORPORATION as
directed on the reverse side of this card and, in their discretion, on all
other matters which may properly come before the Annual Meeting of Stockholders
to be held on May 1, 1998, and at any adjournment, as if the undersigned were
present and voting at the meeting.
The shares represented by this proxy will be voted as directed on the
reverse side of this card. WHERE NO DIRECTION IS GIVEN, SUCH SHARES WILL BE
VOTED FOR ITEMS 1, 2 AND 3 AND AGAINST ITEM 4. In the event any of the nominees
named on the reverse side of this card is unavailable for election or unable to
serve, the shares represented by this proxy may be voted for a substitute
nominee selected by the Board of Directors.
- -------------------------------------------------------------------------------
(arrow pointing upward) SIGN, DETACH AND RETURN (arrow pointing upward)
(logo)
IT IS IMPORTANT THAT YOUR PROXY BE RETURNED PROMPTLY. THEREFORE, YOU ARE URGED
TO COMPLETE, SIGN, DATE, DETACH AND RETURN THE ACCOMPANYING PROXY IN THE
ENCLOSED ENVELOPE.
YOUR PROXY WILL BE KEPT CONFIDENTIAL IN ACCORDANCE WITH THE CONFIDENTIAL
VOTING POLICY DESCRIBED ON PAGE 2 OF THE PROXY STATEMENT.
(arrow pointing downward) BRING TO ANNUAL MEETING (arrow pointing downward)
- -------------------------------------------------------------------------------
Since parking at the Santa Monica Civic Auditorium is limited, we have arranged
for alternate parking at the beach parking lot.
For your convenience, below are a map and parking instructions for the beach
parking lot.
(MAP OF AREA)
SPECIAL PARKING INSTRUCTIONS
Beach Parking Lot
- Exit Santa Monica Civic Auditorium.
- Turn left on Main Street and proceed to Pico
Boulevard. Turn right on Pico.
- Take Pico to Ocean Avenue and turn left on
Ocean Avenue.
- Follow Ocean down the hill and make a right
turn into the beach parking lot.
Park your car in the lot. A bus will take you to
the Civic Auditorium, and a bus will return you
to the beach parking lot AFTER the meeting.
CONTINUOUS SHUTTLE SERVICE WILL BE
PROVIDED from 8:30 A.M. to 2:00 P.M.
The parking fee will be paid by Occidental
Petroleum Corporation.
There is no charge for the shuttle service.
(REVERSE SIDE OF PROXY)
The shares represented by this proxy card will be voted as directed below.
WHERE NO DIRECTION IS GIVEN, SUCH SHARES WILL BE VOTED FOR ITEMS 1, 2 AND
3 AND AGAINST ITEM 4. THIS PROXY CARD WILL BE KEPT CONFIDENTIAL IN ACCORDANCE
WITH THE CONFIDENTIAL VOTING POLICY DESCRIBED ON PAGE 2 OF THE PROXY STATEMENT.
[X] Please mark your votes as this
THE BOARD OF DIRECTORS RECOMMENDS A VOTE FOR ITEMS 1, 2 AND 3.
FOR WITHHELD
ALL FOR ALL
ITEM 1 The election as directors of the following nominees:
Drs. Ray R. Irani and Dale R. Laurance and Messrs. Edward P. [ ] [ ]
Djerejian, Irvin W. Maloney and Aziz D. Syriani. (To withhold
authority to vote for any nominee(s), mark FOR ALL and write
nominee(s) name(s) in the space provided below.)
_____________________________________________________________
FOR AGAINST ABSTAIN
ITEM 2 The ratification of the selection of [ ] [ ] [ ]
Arthur Andersen LLP as independent public accountants.
FOR AGAINST ABSTAIN
ITEM 3 The proposal to approve the amendments to the [ ] [ ] [ ]
Occidental Petroleum Corporation 1995 Incentive
Stock Plan.
THE BOARD OF DIRECTORS RECOMMENDS A VOTE AGAINST ITEM 4.
FOR AGAINST ABSTAIN
ITEM 4 The stockholder proposal regarding maximizing [ ] [ ] [ ]
value.
Discontinue mailing Annual Report to this account. [ ]
Please sign your name exactly as it appears printed hereon. When shares are
held by joint tenants, both should sign. Executors, administrators, guardians,
officers of corporations and others signing in a fiduciary capacity should sign
their full title as such.
SIGNATURE __________________________________________ DATE ____________________
SIGNATURE __________________________________________ DATE ____________________
- -------------------------------------------------------------------------------
(arrow pointing upward) SIGN, DETACH AND RETURN (arrow pointing upward)
PLEASE HELP US ELIMINATE DUPLICATE MAILINGS.
OCCIDENTAL PETROLEUM CORPORATION IS REQUIRED TO SEND AN ANNUAL REPORT TO EVERY
STOCKHOLDER. IF YOU HAVE MULTIPLE ACCOUNTS WITH THE SAME ADDRESS, PLEASE HELP
US REDUCE COSTS BY DIRECTING US TO DISCONTINUE MAILING FUTURE ANNUAL REPORTS TO
ONE OR MORE SUCH ACCOUNTS. MARK THE APPROPRIATE BOX ON THE PROXY CARD FOR EACH
SUCH ACCOUNT. THE PROXY CARD FOR AT LEAST ONE ACCOUNT MUST REMAIN UNMARKED TO
RECEIVE AN ANNUAL REPORT. DO NOT TERMINATE MAILINGS FOR ACCOUNTS FOR WHICH YOU
SERVE AS A TRUSTEE, GUARDIAN OR OTHER FORM OF NOMINEE.
(arrow pointing downward) BRING TO ANNUAL MEETING (arrow pointing downward)
- -------------------------------------------------------------------------------
(logo) OCCIDENTAL PETROLEUM CORPORATION
ANNUAL MEETING OF STOCKHOLDERS
PREREGISTRATION FORM
Santa Monica Civic Auditorium
1855 Main Street, Santa Monica
Meeting Hours
Exhibit Room opens at 9:15 A.M.
Meeting starts at 10:30 A.M.
TO SPEED UP REGISTRATION, PLEASE BRING THIS CARD WITH YOU TO THE
MEETING ON MAY 1. DO NOT MAIL.
Please see the back of this card for parking instructions.
1265-A(SOR)
(VOTING INSTRUCTION CARD FOR THE OCCIDENTAL PETROLEUM CORPORATION
SAVINGS PLAN)
OCCIDENTAL PETROLEUM CORPORATION
ANNUAL MEETING OF STOCKHOLDERS
TO THE TRUSTEE OF THE OCCIDENTAL PETROLEUM CORPORATION
SAVINGS PLAN:
I acknowledge receipt of the Notice of Annual Meeting of Stockholders of
Occidental Petroleum Corporation to be held on May 1, 1998, and the Proxy
Statement furnished in connection with the solicitation of proxies by
Occidental's Board of Directors. You are directed to vote the shares which are
held for my account pursuant to the Occidental Petroleum Corporation Savings
Plan in the manner indicated on the reverse side of this card and, in your
discretion, on all other matters which may properly come before such meeting
and at any adjournment.
My vote for the election of directors is indicated on the reverse side.
Nominees are: Dr. Ray R. Irani, Dr. Dale R. Laurance, Edward P. Djerejian,
Irvin W. Maloney and Aziz D. Syriani. In the event any of the foregoing
nominees is unavailable for election or unable to serve, shares represented by
this card may be voted for a substitute nominee selected by the Board of
Directors.
I UNDERSTAND THAT IN THE EVENT THAT I DO NOT RETURN THIS CARD, ANY SHARES
HELD FOR MY ACCOUNT IN THE OCCIDENTAL PETROLEUM CORPORATION SAVINGS PLAN WILL
BE VOTED BY YOU IN ACCORDANCE WITH THE DIRECTION OF THE PLAN'S ADMINISTRATIVE
COMMITTEE.
- -------------------------------------------------------------------------------
(arrow pointing upward) SIGN, DETACH AND RETURN (arrow pointing upward)
(logo)
IT IS IMPORTANT THAT YOUR VOTING INSTRUCTION CARD BE RETURNED PROMPTLY.
THEREFORE, YOU ARE URGED TO COMPLETE, SIGN, DATE, DETACH AND RETURN THE
ACCOMPANYING CARD IN THE ENCLOSED ENVELOPE.
YOUR VOTING INSTRUCTION CARD WILL BE KEPT CONFIDENTIAL IN ACCORDANCE WITH
THE CONFIDENTIAL VOTING POLICY DESCRIBED ON PAGE 2 OF THE PROXY STATEMENT.
1265-B(PSA)
(REVERSE SIDE OF VOTING INSTRUCTION CARD FOR THE OCCIDENTAL
PETROLEUM CORPORATION SAVINGS PLAN)
The shares represented by this voting instruction card will be voted as
directed below. WHERE NO DIRECTION IS GIVEN, SUCH SHARES WILL BE VOTED FOR
ITEMS 1, 2 AND 3 AND AGAINST ITEM 4. THIS VOTING INSTRUCTION CARD WILL BE KEPT
CONFIDENTIAL IN ACCORDANCE WITH THE CONFIDENTIAL VOTING POLICY DESCRIBED ON
PAGE 2 OF THE PROXY STATEMENT.
[X] Please mark your votes as this
THE BOARD OF DIRECTORS RECOMMENDS A VOTE FOR ITEMS 1, 2 AND 3.
FOR WITHHELD
ALL FOR ALL
ITEM 1 The election as directors of the following nominees:
Drs. Ray R. Irani and Dale R. Laurance and Messrs. Edward P. [ ] [ ]
Djerejian, Irvin W. Maloney and Aziz D. Syriani. (To withhold
authority to vote for any nominee(s), mark FOR ALL and write
nominee(s) name(s) in the space provided below.)
_____________________________________________________________
FOR AGAINST ABSTAIN
ITEM 2 The ratification of the selection of [ ] [ ] [ ]
Arthur Andersen LLP as independent public accountants.
FOR AGAINST ABSTAIN
ITEM 3 The proposal to approve the amendments to the [ ] [ ] [ ]
Occidental Petroleum Corporation 1995 Incentive Stock
Plan.
THE BOARD OF DIRECTORS RECOMMENDS A VOTE AGAINST ITEM 4.
FOR AGAINST ABSTAIN
ITEM 4 The stockholder proposal regarding maximizing [ ] [ ] [ ]
value.
Please sign your name exactly as it appears printed hereon. Executors,
administrators, guardians and others signing in a fiduciary capacity should
sign their full title as such.
SIGNATURE __________________________________________ DATE ____________________
SIGNATURE __________________________________________ DATE ____________________
- -------------------------------------------------------------------------------
(arrow pointing upward) SIGN, DETACH AND RETURN (arrow pointing upward)
(logo)
IT IS IMPORTANT THAT YOUR VOTING INSTRUCTION CARD BE RETURNED PROMPTLY.
THEREFORE, YOU ARE URGED TO COMPLETE, SIGN, DATE, DETACH AND RETURN THE
ACCOMPANYING CARD IN THE ENCLOSED ENVELOPE.
YOUR VOTING INSTRUCTION CARD WILL BE KEPT CONFIDENTIAL IN ACCORDANCE WITH
THE CONFIDENTIAL VOTING POLICY DESCRIBED ON PAGE 2 OF THE PROXY STATEMENT.
1265-B(PSA)
(VOTING INSTRUCTION CARD FOR THE OCCIDENTAL CHEMICAL CORPORATION
SAVINGS AND INVESTMENT PLAN)
OCCIDENTAL PETROLEUM CORPORATION
ANNUAL MEETING OF STOCKHOLDERS
TO THE TRUSTEE OF THE OCCIDENTAL CHEMICAL CORPORATION
SAVINGS AND INVESTMENT PLAN:
I acknowledge receipt of the Notice of Annual Meeting of Stockholders of
Occidental Petroleum Corporation to be held on May 1, 1998, and the Proxy
Statement furnished in connection with the solicitation of proxies by
Occidental's Board of Directors. You are directed to vote the shares which
are held for my account pursuant to the Occidental Chemical Corporation
Savings and Investment Plan in the manner indicated on the reverse side of
this card and, in your discretion, on all other matters which may properly
come before such meeting and at any adjournment.
My vote for the election of directors is indicated on the reverse side.
Nominees are: Dr. Ray R. Irani, Dr. Dale R. Laurance, Edward P. Djerejian,
Irvin W. Maloney and Aziz D. Syriani. In the event any of the foregoing
nominees is unavailable for election or unable to serve, shares represented by
this card may be voted for a substitute nominee selected by the Board of
Directors.
I UNDERSTAND THAT IN THE EVENT THAT I DO NOT RETURN THIS CARD, ANY SHARES
HELD FOR MY ACCOUNT IN THE OCCIDENTAL CHEMICAL CORPORATION SAVINGS AND
INVESTMENT PLAN WILL BE VOTED BY YOU IN ACCORDANCE WITH THE DIRECTION OF THE
PLAN'S ADMINISTRATIVE COMMITTEE.
- -------------------------------------------------------------------------------
(arrow pointing upward) SIGN, DETACH AND RETURN (arrow pointing upward)
(logo)
IT IS IMPORTANT THAT YOUR VOTING INSTRUCTION CARD BE RETURNED PROMPTLY.
THEREFORE, YOU ARE URGED TO COMPLETE, SIGN, DATE, DETACH AND RETURN THE
ACCOMPANYING CARD IN THE ENCLOSED ENVELOPE.
YOUR VOTING INSTRUCTION CARD WILL BE KEPT CONFIDENTIAL IN ACCORDANCE WITH
THE CONFIDENTIAL VOTING POLICY DESCRIBED ON PAGE 2 OF THE PROXY STATEMENT.
1265-C(SIP)
(REVERSE SIDE OF VOTING INSTRUCTION CARD FOR THE OCCIDENTAL
CHEMICAL CORPORATION SAVINGS AND INVESTMENT PLAN)
The shares represented by this voting instruction card will be voted as
directed below. WHERE NO DIRECTION IS GIVEN, SUCH SHARES WILL BE VOTED FOR
ITEMS 1, 2 AND 3 AND AGAINST ITEM 4. THIS VOTING INSTRUCTION CARD WILL BE KEPT
CONFIDENTIAL IN ACCORDANCE WITH THE CONFIDENTIAL VOTING POLICY DESCRIBED ON
PAGE 2 OF THE PROXY STATEMENT.
[X] Please mark your votes as this
THE BOARD OF DIRECTORS RECOMMENDS A VOTE FOR ITEMS 1, 2 AND 3.
FOR WITHHELD
ALL FOR ALL
ITEM 1 The election as directors of the following nominees:
Drs. Ray R. Irani and Dale R. Laurance, and Messrs. Edward P. [ ] [ ]
Djerejian, Irvin W. Maloney and Aziz D. Syriani. (To withhold
authority to vote for any nominee(s), mark FOR ALL and write
nominee(s) name(s) in the space provided below.)
____________________________________________________________
FOR AGAINST ABSTAIN
ITEM 2 The ratification of the selection of [ ] [ ] [ ]
Arthur Andersen LLP as independent public accountants.
FOR AGAINST ABSTAIN
ITEM 3 The proposal to approve the amendments to the [ ] [ ] [ ]
Occidental Petroleum Corporation 1995 Incentive Stock
Plan.
THE BOARD OF DIRECTORS RECOMMENDS A VOTE AGAINST ITEM 4.
FOR AGAINST ABSTAIN
ITEM 4 The stockholder proposal regarding maximizing [ ] [ ] [ ]
value.
Please sign your name exactly as it appears printed hereon. Executors,
administrators, guardians and others signing in a fiduciary capacity should
sign their full title as such.
SIGNATURE __________________________________________ DATE ____________________
SIGNATURE __________________________________________ DATE ____________________
- -------------------------------------------------------------------------------
(arrow pointing upward) SIGN, DETACH AND RETURN (arrow pointing upward)
(logo)
IT IS IMPORTANT THAT YOUR VOTING INSTRUCTION CARD BE RETURNED PROMPTLY.
THEREFORE, YOU ARE URGED TO COMPLETE, SIGN, DATE, DETACH AND RETURN THE
ACCOMPANYING CARD IN THE ENCLOSED ENVELOPE.
YOUR VOTING INSTRUCTION CARD WILL BE KEPT CONFIDENTIAL IN ACCORDANCE WITH
THE CONFIDENTIAL VOTING POLICY DESCRIBED ON PAGE 2 OF THE PROXY STATEMENT.
1265-C(SIP)
(VOTING INSTRUCTION CARD FOR THE EMPLOYEES THRIFT PLAN OF OXY USA INC.)
OCCIDENTAL PETROLEUM CORPORATION
ANNUAL MEETING OF STOCKHOLDERS
TO THE TRUSTEE OF THE EMPLOYEES THRIFT PLAN OF OXY USA INC.:
I acknowledge receipt of the Notice of Annual Meeting of Stockholders of
Occidental Petroleum Corporation to be held on May 1, 1998, and the Proxy
Statement furnished in connection with the solicitation of proxies by
Occidental's Board of Directors. You are directed to vote the shares which are
held for my account pursuant to the Employees Thrift Plan of OXY USA Inc. in
the manner indicated on the reverse side of this card and, in your discretion,
on all other matters which may properly come before such meeting and at any
adjournment.
My vote for the election of directors is indicated on the reverse side.
Nominees are: Dr. Ray R. Irani, Dr. Dale R. Laurance, Edward P. Djerejian,
Irvin W. Maloney and Aziz D. Syriani. In the event any of the foregoing
nominees is unavailable for election or unable to serve, shares represented by
this card may be voted for a substitute nominee selected by the Board of
Directors.
I UNDERSTAND THAT IN THE EVENT THAT I DO NOT RETURN THIS CARD, ANY SHARES
HELD FOR MY ACCOUNT IN THE EMPLOYEES THRIFT PLAN OF OXY USA INC. WILL BE
VOTED BY YOU IN ACCORDANCE WITH THE DIRECTION OF THE PENSION PLANS
ADMINISTRATIVE COMMITTEE.
1265-F(TUL)
(REVERSE SIDE OF VOTING INSTRUCTION CARD FOR THE EMPLOYEES THRIFT PLAN
OF OXY USA INC.)
The shares represented by this voting instruction card will be voted as
directed below. WHERE NO DIRECTION IS GIVEN, SUCH SHARES WILL BE VOTED FOR
ITEMS 1, 2 AND 3 AND AGAINST ITEM 4. THIS VOTING INSTRUCTION CARD WILL BE KEPT
CONFIDENTIAL IN ACCORDANCE WITH THE CONFIDENTIAL VOTING POLICY DESCRIBED ON
PAGE 2 OF THE PROXY STATEMENT.
[X] Please mark your votes as this
THE BOARD OF DIRECTORS RECOMMENDS A VOTE FOR ITEMS 1, 2 AND 3.
FOR WITHHELD
ALL FOR ALL
ITEM 1 The election as directors of the following nominees:
Drs. Ray R. Irani and Dale R. Laurance and Messrs. Edward P. [ ] [ ]
Djerejian, Irvin W. Maloney and Aziz D. Syriani. (To withhold
authority to vote for any nominee(s), mark FOR ALL and write
nominee(s) name(s) in the space provided below.)
_____________________________________________________________
FOR AGAINST ABSTAIN
ITEM 2 The ratification of the selection of [ ] [ ] [ ]
Arthur Andersen LLP as independent public accountants.
FOR AGAINST ABSTAIN
ITEM 3 The proposal to approve the amendments to the [ ] [ ] [ ]
Occidental Petroleum Corporation 1995 Incentive Stock
Plan.
THE BOARD OF DIRECTORS RECOMMENDS A VOTE AGAINST ITEM 4.
FOR AGAINST ABSTAIN
ITEM 4 The stockholder proposal regarding maximizing [ ] [ ] [ ]
value.
Please sign your name exactly as it appears printed hereon. Executors,
administrators, guardians and others signing in a fiduciary capacity should
sign their full title as such.
SIGNATURE __________________________________________ DATE ____________________
SIGNATURE __________________________________________ DATE ____________________
(PROXY CARD - BROKER)
PROXY
THIS PROXY IS SOLICITED ON BEHALF OF
THE BOARD OF DIRECTORS
OCCIDENTAL PETROLEUM CORPORATION
DR. RAY R. IRANI, DR. DALE R. LAURANCE and AZIZ D. SYRIANI, and each of them,
with full power of substitution, are hereby authorized to represent and to vote
the shares of the undersigned in OCCIDENTAL PETROLEUM CORPORATION as directed
on the reverse side of this card and, in their discretion, on all other matters
which may properly come before the Annual Meeting of Stockholders to be held on
May 1, 1998, and at any adjournment, as if the undersigned were present and
voting at the meeting.
The shares represented by this proxy will be voted as directed on the
reverse side of this card. WHERE NO DIRECTION IS GIVEN, SUCH SHARES WILL BE
VOTED FOR ITEMS 1, 2 AND 3 AND AGAINST ITEM 4. In the event any of the nominees
named on the reverse side of this card is unavailable for election or unable
to serve, the shares represented by this proxy may be voted for a substitute
nominee selected by the Board of Directors.
1265-E (BRO)
(REVERSE SIDE OF PROXY CARD - BROKER)
The shares represented by this proxy card will be voted as directed below.
WHERE NO DIRECTION IS GIVEN, SUCH SHARES WILL BE VOTED FOR ITEMS 1, 2 AND
3 AND AGAINST ITEM 4. THIS PROXY CARD WILL BE KEPT CONFIDENTIAL IN ACCORDANCE
WITH THE CONFIDENTIAL VOTING POLICY DESCRIBED ON PAGE 2 OF THE PROXY STATEMENT.
[X] Please mark your votes as this
THE BOARD OF DIRECTORS RECOMMENDS A VOTE FOR ITEMS 1, 2 AND 3.
FOR WITHHELD
ALL FOR ALL
ITEM 1 The election as directors of the following nominees:
Drs. Ray R. Irani and Dale R. Laurance and Messrs. Edward P. [ ] [ ]
Djerejian, Irvin W. Maloney and Aziz D. Syriani. (To withhold
authority to vote for any nominee(s), mark FOR ALL and write
nominee(s) name(s) in the space provided below.)
_____________________________________________________________
FOR AGAINST ABSTAIN
ITEM 2 The ratification of the selection of [ ] [ ] [ ]
Arthur Andersen LLP as independent public accountants.
FOR AGAINST ABSTAIN
ITEM 3 The proposal to approve the amendments to the [ ] [ ] [ ]
Occidental Petroleum Corporation 1995 Incentive Stock
Plan.
THE BOARD OF DIRECTORS RECOMMENDS A VOTE AGAINST ITEM 4.
FOR AGAINST ABSTAIN
ITEM 4 The stockholder proposal regarding maximizing [ ] [ ] [ ]
value.
Please sign your name exactly as it appears printed hereon. Executors,
administrators, guardians and others signing in a fiduciary capacity should
sign their full title as such.
SIGNATURE __________________________________________ DATE ____________________
SIGNATURE __________________________________________ DATE ____________________
(VOTING INSTRUCTION CARD FOR THE MIDCON CORP. SAVINGS PLAN)
OCCIDENTAL PETROLEUM CORPORATION
ANNUAL MEETING OF STOCKHOLDERS
TO THE TRUSTEE OF THE MIDCON CORP. SAVINGS PLAN:
I acknowledge receipt of the Notice of Annual Meeting of Stockholders of
Occidental Petroleum Corporation to be held on May 1, 1998, and the Proxy
Statement furnished in connection with the solicitation of proxies by
Occidental's Board of Directors. You are directed to vote the shares which
are held for my account pursuant to the MidCon Corp. Savings Plan in the manner
indicated on the reverse side of this card and, in your discretion, on all
other matters which may properly come before such meeting and at any
adjournment.
My vote for the election of directors is indicated on the reverse side.
Nominees are: Dr. Ray R. Irani, Dr. Dale R. Laurance, Edward P. Djerejian,
Irvin W. Maloney and Aziz D. Syriani. In the event any of the foregoing
nominees is unavailable for election or unable to serve, shares represented by
this card may be voted for a substitute nominee selected by the Board of
Directors.
I UNDERSTAND THAT IN THE EVENT THAT I DO NOT RETURN THIS CARD, ANY SHARES
HELD FOR MY ACCOUNT IN THE MIDCON CORP. SAVINGS PLAN WILL BE VOTED BY YOU IN
ACCORDANCE WITH THE DIRECTION OF THE PLAN'S ADMINISTRATIVE COMMITTEE.
- -------------------------------------------------------------------------------
(arrow pointing upward) SIGN, DETACH AND RETURN (arrow pointing upward)
(LOGO)
IT IS IMPORTANT THAT YOUR VOTING INSTRUCTION CARD BE RETURNED PROMPTLY.
THEREFORE, YOU ARE URGED TO COMPLETE, SIGN, DATE, DETACH AND RETURN THE
ACCOMPANYING CARD IN THE ENCLOSED ENVELOPE.
YOUR VOTING INSTRUCTION CARD WILL BE KEPT CONFIDENTIAL IN ACCORDANCE WITH
THE CONFIDENTIAL VOTING POLICY DESCRIBED ON PAGE 2 OF THE PROXY STATEMENT.
1265-D(MSA)
(REVERSE SIDE OF VOTING INSTRUCTION CARD FOR THE MIDCON CORPORATION SAVINGS
PLAN)
The shares represented by this voting instruction card will be voted as
directed below. WHERE NO DIRECTION IS GIVEN, SUCH SHARES WILL BE VOTED FOR
ITEMS 1, 2 AND 3 AND AGAINST ITEM 4. THIS VOTING INSTRUCTION CARD WILL BE KEPT
CONFIDENTIAL IN ACCORDANCE WITH THE CONFIDENTIAL VOTING POLICY DESCRIBED ON
PAGE 2 OF THE PROXY STATEMENT.
[X] Please mark your votes as this
THE BOARD OF DIRECTORS RECOMMENDS A VOTE FOR ITEMS 1, 2 AND 3.
FOR WITHHELD
ALL FOR ALL
ITEM 1 The election as directors of the following nominees: [ ] [ ]
Drs. Ray R. Irani and Dale R. Laurance and Messrs. Edward P.
Djerejian, Irvin W. Maloney and Aziz D. Syriani. (To withhold
authority to vote for any nominee(s), mark FOR ALL and write
nominee(s) name(s) in the space provided below.)
_____________________________________________________________
FOR AGAINST ABSTAIN
ITEM 2 The ratification of the selection of [ ] [ ] [ ]
Arthur Andersen LLP as independent public accountants.
ITEM 3 The proposal to approve the amendments to the [ ] [ ] [ ]
Occidental Petroleum Corporation 1995 Incentive Stock
Plan.
THE BOARD OF DIRECTORS RECOMMENDS A VOTE AGAINST ITEM 4.
FOR AGAINST ABSTAIN
ITEM 4 The stockholder proposal regarding maximizing [ ] [ ] [ ]
value.
Please sign your name exactly as it appears printed hereon. Executors,
administrators, guardians and others signing in a fiduciary capacity
should sign their full title as such.
SIGNATURE ___________________________________ DATE ____________________________
SIGNATURE ___________________________________ DATE ____________________________
- -------------------------------------------------------------------------------
(arrow pointing upward) SIGN, DETACH AND RETURN (arrow pointing upward)
(LOGO)
IT IS IMPORTANT THAT YOUR VOTING INSTRUCTION CARD BE RETURNED PROMPTLY.
THEREFORE, YOU ARE URGED TO COMPLETE, SIGN, DATE, DETACH AND RETURN THE
ACCOMPANYING CARD IN THE ENCLOSED ENVELOPE.
YOUR VOTING INSTRUCTION CARD WILL BE KEPT CONFIDENTIAL IN ACCORDANCE
WITH THE CONFIDENTIAL VOTING POLICY DESCRIBED ON PAGE 2 OF THE
PROXY STATEMENT.
1265-D(MSA)
(LOGO) OCCIDENTAL PETROLEUM CORPORATION
10889 WILSHIRE BOULEVARD
LOS ANGELES, CALIFORNIA 90024
DR. RAY R. IRANI
CHAIRMAN OF THE BOARD
AND
CHIEF EXECUTIVE OFFICER
March 17, 1998
Dear MidCon Corp. Savings Plan Participant:
I am pleased to enclose a notice and proxy statement for our
annual meeting to be held on May 1, 1998, together with a
voting instruction card. I sincerely hope that, as an Occidental
stockholder through the MidCon Corp. Savings Plan, you will
participate in the affairs of the company by voting your shares.
Please mark and sign the enclosed card and mail it as soon
as possible in the enclosed envelope to the Plan's trustee. The
trustee will then cause the shares in your plan account(s) to be
voted according to your instructions. Your instructions to the
trustee will be kept confidential.
Thank you for your cooperation.
R. R. IRANI
P.S. Many of you own shares of Occidental stock other than
through the MidCon Corp. Savings Plan, in which case you will
receive a separate notice, proxy statement and proxy card with
respect to those shares. That proxy card should be returned in
the envelope provided with the card.
(LOGO) OCCIDENTAL PETROLEUM CORPORATION
10889 WILSHIRE BOULEVARD
LOS ANGELES, CALIFORNIA 90024
DR. RAY R. IRANI
CHAIRMAN OF THE BOARD
AND
CHIEF EXECUTIVE OFFICER
March 17, 1998
Dear Occidental Chemical Corporation Savings and Investment Plan
Participant:
I am pleased to enclose a notice and proxy statement for our
annual meeting to be held on May 1, 1998, together with a
voting instruction card. I sincerely hope that, as an Occidental
stockholder through the Occidental Chemical Corporation Savings
and Investment Plan, you will participate in the affairs of the
company by voting your shares.
Please mark and sign the enclosed card and mail it as soon
as possible in the enclosed envelope to the Plan's trustee. The
trustee will then cause the shares in your plan account(s) to be
voted according to your instructions. Your instructions to the
trustee will be kept confidential.
Thank you for your cooperation.
R. R. IRANI
P.S. Many of you own shares of Occidental stock other than
through the Occidental Chemical Corporation Savings and
Investment Plan, in which case you will receive a separate
notice, proxy statement and proxy card with respect to those
shares. That proxy card should be returned in the envelope
provided with the card.
(LOGO) OCCIDENTAL PETROLEUM CORPORATION
10889 WILSHIRE BOULEVARD
LOS ANGELES, CALIFORNIA 90024
DR. RAY R. IRANI
CHAIRMAN OF THE BOARD
AND
CHIEF EXECUTIVE OFFICER
March 17, 1998
Dear OXY USA Inc. Employees Thrift Plan Participant:
I am pleased to enclose a notice and proxy statement for our
annual meeting to be held on May 1, 1998, together with a
voting instruction card. I sincerely hope that, as an Occidental
stockholder through the OXY USA Inc. Employees Thrift Plan, you
will participate in the affairs of the company by voting your
shares.
Please mark and sign the enclosed card and mail it as soon
as possible in the enclosed envelope to the Plan's trustee. The
trustee will then cause the shares in your plan account(s) to be
voted according to your instructions. Your instructions to the
trustee will be kept confidential.
Thank you for your cooperation.
R. R. IRANI
P.S. Many of you own shares of Occidental stock other than
through the OXY USA Inc. Employees Thrift Plan, in which case you
will receive a separate notice, proxy statement and proxy card
with respect to those shares. That proxy card should be returned
in the envelope provided with the card.
(LOGO) OCCIDENTAL PETROLEUM CORPORATION
10889 WILSHIRE BOULEVARD
LOS ANGELES, CALIFORNIA 90024
DR. RAY R. IRANI
CHAIRMAN OF THE BOARD
AND
CHIEF EXECUTIVE OFFICER
March 17, 1998
Dear Occidental Petroleum Corporation Savings Plan Participant:
I am pleased to enclose a notice and proxy statement for our
annual meeting to be held on May 1, 1998, together with a
voting instruction card. I sincerely hope that, as an Occidental
stockholder through the Occidental Petroleum Corporation Savings
Plan, you will participate in the affairs of the company by
voting your shares.
Please mark and sign the enclosed card and mail it as soon
as possible in the enclosed envelope to the Plan's trustee. The
trustee will then cause the shares in your plan account(s) to be
voted according to your instructions. Your instructions to the
trustee will be kept confidential.
Thank you for your cooperation.
R. R. IRANI
P.S. This message applies to those of you who own shares of
Occidental stock other than through the Occidental Petroleum
Corporation Savings Plan. You will receive a separate notice,
proxy statement and proxy card with respect to those shares. That
proxy card should be returned in the envelope provided with the
card. In order to eliminate unnecessary duplicate distribution of
the annual report, the transfer agent has not included the annual
report with this mailing, but you will find the report in the
separate mailing you will receive in connection with the stock
you own other than through the Occidental Petroleum Corporation
Savings Plan.