<PAGE>
As filed with the Securities and Exchange Commission on February 22, 1999
Registration No.
================================================================================
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
-------------------------
FORM S-8
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
--------------------------
OCCIDENTAL PETROLEUM CORPORATION
(EXACT NAME OF ISSUER AS SPECIFIED IN ITS CHARTER)
DELAWARE 95-4035997
(STATE OR OTHER JURISDICTION OF (I.R.S. EMPLOYER
INCORPORATION OR ORGANIZATION) IDENTIFICATION NO.)
10889 WILSHIRE BOULEVARD
LOS ANGELES, CALIFORNIA 90024
(ADDRESS OF PRINCIPAL EXECUTIVE OFFICES) (ZIP CODE)
OCCIDENTAL PETROLEUM CORPORATION SAVINGS PLAN
(FULL TITLE OF THE PLAN)
DONALD P. DE BRIER, ESQ., GENERAL COUNSEL
OCCIDENTAL PETROLEUM CORPORATION
10889 WILSHIRE BOULEVARD
LOS ANGELES, CALIFORNIA
(310) 208-8800
(NAME, ADDRESS AND TELEPHONE NUMBER, INCLUDING AREA CODE, OF AGENT FOR SERVICE)
CALCULATION OF REGISTRATION FEE
================================================================================
Proposed
Maximum Proposed
Title of Offering Maximum
Securities Amount Price Aggregate
to be to be Per Offering Amount of
Registered Registered Share(1) Price(1) Registration Fee
- --------------------------------------------------------------------------------
Common
Stock, $.20
par value 2,000,000(2) $15.125 $30,250,000 $8,409.50
(including
Preferred
Stock
Purchase
Rights)
================================================================================
(1) Estimated pursuant to Rule 457 solely for the purpose of calculating the
amount of the registration fee based on the average of the high and low
price for the Common Stock on February 16, 1999.
(2) Includes an indeterminate number of additional shares which may be
necessary to adjust the number of shares reserved for issuance pursuant to
the plan as the results of any future stock split, stock dividend or
similar adjustment of the outstanding Common Stock of the Registrant.
<PAGE>
PART II
-------
INFORMATION REQUIRED IN REGISTRATION STATEMENT
ITEM 3. INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE
The following documents are hereby incorporated by reference in this
Registration Statement:
(a) The Annual Report on Form 10-K of Occidental Petroleum Corporation
("Occidental" or the "Registrant") for the year ended December 31, 1997;
(b) (i) Quarterly Reports on Form 10-Q for the quarterly periods ended
March 31, 1998, June 30, 1998, and September 30, 1998;
(ii) Current Reports on Form 8-K, dated January 26, 1998 (filed
January 27, 1998), January 30, 1998 (filed January 30, 1998), January 31, 1998
(filed February 10, 1998), February 10, 1998 (filed April 20, 1998), February
11, 1998 (filed February 12, 1998), February 12, 1998 (filed February 26, 1998),
April 1, 1998 (filed April 3, 1998), April 20, 1998 (filed April 21, 1998), May
15, 1998 (filed May 29, 1998), May 15, 1998 (filed July 17, 1998), July 20, 1998
(filed July 21, 1998), September 25, 1998 (filed October 2, 1998), October 21,
1998 (filed October 22, 1998), November 16, 1998 (filed November 20, 1998),
January 6, 1999 (filed January 6, 1999), January 13, 1999 (filed January 20,
1999), January 26, 1999 (filed January 27, 1999), and February 5, 1999 (filed
February 10, 1999); and
(iii) Current Report on Form 8-K/A dated January 20, 1999 (filed
January 22, 1999); and
(c) The description of the Common Stock contained in the Registration
Statement on Form 8-B, dated June 26, 1986 (as amended by Form 8, dated December
22, 1986, Form 8, dated February 3, 1988, Form 8-B/A, dated July 12, 1993, Form
8-B/A, dated March 21, 1994, and Form 8-B/A, dated November 2, 1995 and
including any amendment or report filed for the purpose of updating such
descriptions subsequent to the date of this Registration Statement).
All documents filed by the Registrant or the Occidental Petroleum
Corporation Savings Plan (the "Plan") pursuant to Sections 13(a), 13(c), 14 and
15(d) of the Securities Exchange Act of 1934, as amended, after the date hereof
prior to the filing of a post-effective amendment which indicates that the
securities offered hereby have been sold or which deregisters the securities
covered hereby then remaining unsold, shall also be deemed to be incorporated by
reference into this Registration Statement and to be a part hereof from the date
of delivery of such documents. Any statement contained in a document
incorporated or deemed to be incorporated by reference herein shall be deemed to
be modified or superseded for purposes of this Registration Statement to the
extent that a statement contained herein, or in any other subsequently filed
document that also is or is deemed to be incorporated by reference herein,
modifies or supersedes such statement. Any such statement so modified or
superseded shall not be deemed, except as so modified or superseded, to
constitute a part of this Registration Statement.
2
<PAGE>
ITEM 4. DESCRIPTION OF SECURITIES
Not applicable.
ITEM 5. INTERESTS OF NAMED EXPERTS AND COUNSEL
The validity of the Common Stock registered pursuant hereto has been passed
upon by Linda S. Peterson, a Senior Counsel of the Registrant. Ms. Peterson
beneficially owns, and has rights to acquire under employee stock options, an
aggregate of less than 1% of the outstanding shares of Common Stock of
Occidental.
ITEM 6. INDEMNIFICATION OF DIRECTORS AND OFFICERS
Section 145 of the Delaware General Corporation Law authorizes a court to
award, or a corporation's board of directors to grant, indemnity to directors
and officers under certain circumstances for liabilities incurred in connection
with their activities in such capacities (including reimbursement for expenses
incurred). Occidental's Restated Certificate of Incorporation, as amended,
provides for the elimination of personal liability of its directors to the full
extent permitted by the Delaware General Corporation Law and Occidental has
entered into indemnification agreements with each director and certain officers
providing for additional indemnification. Article VIII of Occidental's By-laws
provides that Occidental shall indemnify directors and officers under certain
circumstances for liabilities and expenses incurred by reason of their
activities in such capacities. In addition, Occidental has insurance policies
that provide liability coverage to directors and officers while acting in such
capacities.
ITEM 7. EXEMPTION FROM REGISTRATION CLAIMED
Not applicable.
ITEM 8. EXHIBITS
4.1 (a) Restated Certificate of Incorporation of Occidental, together with
all certificates amendatory thereof filed with the Secretary of State
of Delaware, as amended to date (incorporated by reference to Exhibit
3.(i) to Occidental's Annual Report on Form 10-K for the fiscal year
ended December 31, 1994, File No. 1-9210, except for Exhibit 4.1(b)
described below).
(b) Certificate of Amendment of Restated Certificate of Incorporation
of Occidental dated April 25, 1997 (incorporated by reference to
Exhibit 3.(i)(b) to Occidental's Annual Report on Form 10-K for the
fiscal year ended December 31, 1997).
4.2 By-laws of Occidental, as amended through September 17, 1998
(incorporated by reference to Exhibit 3.(ii) to Occidental's Quarterly
Report on Form 10-Q for the quarterly period ended September 30,
1998).
5.1 Opinion of Linda S. Peterson, Esq.
3
<PAGE>
23.1 Consent of Linda S. Peterson, Esq. (Included in Exhibit 5.1).
23.2 Consent of Arthur Andersen LLP.
24.1 Power of Attorney (Reference is hereby made to page 6).
99.1 Occidental Petroleum Corporation Savings Plan, Amended and Restated
October 20, 1998.
ITEM 9. UNDERTAKINGS
The undersigned Registrant hereby undertakes:
1. To file, during any period in which offers or sales are being
made, a post-effective amendment to this registration statement:
(i) To include any prospectus required by Section 10(a)(3)
of the Securities Act of 1933;
(ii) To reflect in the prospectus any facts or events
arising after the effective date of the registration statement (or the most
recent post-effective amendment thereof) which, individually or in the
aggregate, represent a fundamental change in the information set forth in the
registration statement. Notwithstanding the foregoing, any increase or decrease
in volume of securities offered (if the total dollar value of securities offered
would not exceed that which was registered) and any deviation from the low or
high end of the estimated maximum offering range may be reflected in the form of
prospectus filed with the Commission pursuant to Rule 424(b) if, in the
aggregate, the changes in volume and price represent no more than 20% change in
the maximum aggregate offering price set forth in the "Calculation of
Registration Fee" table in the effective registration statement.
(iii) To include any material information with respect to the
plan of distribution not previously disclosed in the registration statement or
any material change to such information in the registration statement.
2. That, for the purpose of determining any liability under the
Securities Act of 1933, each such post-effective amendment shall be deemed to be
a new registration statement relating to the securities offered therein, and the
offering of such securities at that time shall be deemed to be the initial bona
fide offering thereof.
3. To remove from registration by means of a post-effective
amendment any of the securities being registered which remain unsold at the
termination of the offering.
The undersigned registrant hereby undertakes that, for purposes of
determining any liability under the Securities Act of 1933, each filing of the
Registrant's annual report pursuant to Section 13(a) or Section 15(d) of the
Securities Exchange Act of 1934 (and, where applicable, each filing of an
employee benefit plan's annual report pursuant to Section 15(d) of the
Securities Exchange Act of 1934) that is incorporated by reference in the
registration statement shall be deemed to be a new registration statement
relating to the securities offered therein, and the offering of such securities
at that time shall be deemed to be the initial bona fide offering thereof.
Insofar as indemnification for liabilities arising under the Securities Act
of 1933 may be permitted to directors, officers and controlling persons of the
Registrant pursuant to the foregoing
4
<PAGE>
provisions, or otherwise, the Registrant has been advised that in the opinion of
the Securities and Exchange Commission such indemnification is against public
policy as expressed in the Act and is, therefore, unenforceable. In the event
that a claim for indemnification against such liabilities (other than the
payment by the Registrant of expenses incurred or paid by a director, officer or
controlling person of the registrant in the successful defense of any action,
suit or proceeding) is asserted by such director, officer or controlling person
in connection with the securities being registered, the Registrant will, unless
in the opinion of its counsel the matter has been settled by controlling
precedent, submit to a court of appropriate jurisdiction the question whether
such indemnification by it is against public policy as expressed in the Act and
will be governed by the final adjudication of such issue.
5
<PAGE>
POWER OF ATTORNEY
Each person whose signature appears below constitutes and appoints Donald
P. de Brier, John W. Alden, Robert E. Sawyer and Scott A. King his or her true
and lawful attorneys-in-fact and agents, each acting alone, with full powers of
substitution and resubstitution, for him or her and in his or her name, place
and stead, in any and all capacities, to sign any or all Amendments (including
Post-Effective Amendments) to this Registration Statement and/or to sign any
related Registration Statement flied pursuant to Rule 462(b) of the Securities
Act of 1933, as amended, and in each case to file the same, with all exhibits
thereto, and other documents in connection therewith, with the Securities and
Exchange Commission, granting unto said attorneys-in-fact and agents, each
acting alone, full power and authority to do and perform each and every act and
thing requisite and necessary to be done in and about the premises, as fully to
all intents and purposes as he or she might or could do in person, here
ratifying and confirming all that said attorneys-in-fact and agents, each acting
along, or his or her substitute or substitutes, may lawfully do or cause to be
done by virtue hereof.
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, Occidental
Petroleum Corporation certifies that it has reasonable grounds to believe that
it meets all of the requirements for filing on Form S-8 and has duly caused this
Registration Statement to be signed on its behalf by the undersigned, thereunto
duly authorized, in the City of Los Angeles, State of California, on February
22, 1999.
OCCIDENTAL PETROLEUM CORPORATION
By: /s/ R. R. IRANI
-----------------------------------------------------------
Ray R. Irani
Chairman of the Board of Directors and Chief Executive Officer
Pursuant to the requirements of the Securities Act of 1933, this Registration
Statement has been signed by the following persons in the capacities and on the
dates indicated.
SIGNATURE TITLE DATE
--------- ----- ----
Chairman of the Board
/s/ R. R. IRANI of Directors and February 22, 1999
- ---------------------------- Chief Executive Officer
Ray R. Irani
Executive Vice
/s/ STEPHEN I. CHAZEN President and Chief
- ---------------------------- Financial Officer February 22, 1999
Stephen I. Chazen
Vice President and
/s/ S. P. DOMINICK Controller (Chief
- ---------------------------- Accounting Officer) February 22, 1999
Samuel P. Dominick, Jr.
- ---------------------------- Director February 22, 1999
John S. Chalsty
/s/ EDWARD P. DJEREJIAN
- ---------------------------- Director February 22, 1999
Edward P. Djerejian
kk\s-3.sigs.doc
<PAGE>
/s/ JOHN E. FEICK
- ---------------------------- Director February 22, 1999
John E. Feick
/s/ J. ROGER HIRL
- ---------------------------- Director February 22, 1999
J. Roger Hirl
/s/ JOHN W. KLUGE
- ---------------------------- Director February 22, 1999
John W. Kluge
/s/ DALE R. LAURANCE
- ---------------------------- Director February 22, 1999
Dale R. Laurance
/s/ I. W. MALONEY
- ---------------------------- Director February 22, 1999
Irwin W. Maloney
/s/ R. SEGOVIA
- ---------------------------- Director February 22, 1999
Rodolfo Segovia
/s/ A. SYRIANI
- ---------------------------- Director February 22, 1999
Aziz Syriani
/s/ ROSEMARY TOMICH
- ---------------------------- Director February 22, 1999
Rosemary Tomich
- ---------------------------- Director February 22, 1999
George O. Nolley
kk\S-3.sigs.doc
<PAGE>
INDEX TO EXHIBITS
EXHIBIT
NUMBER DESCRIPTION
- ------- -----------
4.1 (a) Restated Certificate of Incorporation of Occidental, together with
all certificates amendatory thereof filed with the Secretary of State
of Delaware, as amended to date (incorporated by reference to Exhibit
3.(i) to Occidental's Annual Report on Form 10-K for the fiscal year
ended December 31, 1994, File No. 1-9210, except for Exhibit 4.1(b)
described below).
(b) Certificate of Amendment of Restated Certificate of Incorporation
of Occidental dated April 25, 1997 (incorporated by reference to
Exhibit 3.(i)(b) to Occidental's Annual Report on Form 10-K for the
fiscal year ended December 31, 1997).
4.2 By-laws of Occidental, as amended through September 17, 1998
(incorporated by reference to Exhibit 3.(ii) to Occidental's Quarterly
Report on Form 10-Q for the quarterly period ended September 30,
1998).
5.1 Opinion of Linda S. Peterson, Esq.
23.1 Consent of Linda S. Peterson, Esq. (Included in Exhibit 5.1).
23.2 Consent of Arthur Andersen LLP.
24.1 Power of Attorney (Reference is hereby made to page 6).
99.1 Occidental Petroleum Corporation Savings Plan, Amended and Restated
October 20, 1998.
<PAGE>
EXHIBIT 5.1
10889 WILSHIRE BOULEVARD
(LOGO) OCCIDENTAL PETROLEUM CORPORATION LOS ANGELES, CALIFORNIA 90024
TELEPHONE (310) 208-8800
FACSIMILE (310) 443-6690
LINDA S. PETERSON
SENIOR COUNSEL
Direct Telephone (310) 443-6189
Direct Facsimile (310) 443-6737
E-Mail [email protected]
February 22, 1999
Occidental Petroleum Corporation
10889 Wilshire Boulevard
Los Angeles, CA 90024
Re: Occidental Petroleum Corporation
Registration Statement on Form S-8
Occidental Petroleum Corporation Savings Plan
Ladies and Gentlemen:
I am a Senior Counsel of Occidental Petroleum Corporation, a Delaware
corporation ("Occidental"), and have acted as counsel to Occidental in
connection with the preparation of the above-referenced Registration Statement
on Form S-8, filed by Occidental with the Securities and Exchange Commission
("Commission") on February 22, 1999 (the "Registration Statement"). The
Registration Statement relates to the registration under the Securities Act of
1933, as amended (the "1933 Act"), of 2,000,000 shares (the "Shares") of Common
Stock, par value $.20 per share, of Occidental. The Shares are to be issued in
accordance with the Occidental Petroleum Corporation Savings Plan (the "Plan").
In connection with this opinion, I have examined and am familiar with
originals or copies, certified or otherwise identified to my satisfaction, of
such records of Occidental and all such agreements, certificates of public
officials, certificates of officers or other representatives of Occidental and
others and such other documents, certificates and records as I have deemed
necessary or appropriate as a basis for the opinions set forth herein,
including, without limitation, (i) the Registration Statement (together with the
form of prospectus forming a part thereof), (ii) the Restated Certificate of
Incorporation and By-laws of Occidental, as amended to date, (iii) copies of the
resolutions adopted by the Board of Directors of Occidental, relating to the
adoption of the Plan, the filing of the Registration Statement and any
amendments or supplements thereto, and the issuance of the Shares and related
matters, and (iv) the Plan. In my examination, I have assumed the genuineness of
all signatures, the legal capacity of natural persons, the authenticity of all
documents submitted to me as originals, the conformity to original documents of
all documents submitted to me as certified, conformed or photostatic copies and
the authenticity of the originals of such copies. As to any facts material to
the opinions expressed herein which I have not independently established or
verified, I have relied upon statements and representations of officers and
other representatives of Occidental and others.
<PAGE>
Occidental Petroleum Corporation
February 22, 1999
Page 2
I am a member of the California and New York Bars and for purposes of this
opinion do not hold myself out as an expert on, nor do I express any opinion as
to, the laws of any jurisdiction other than the General Corporation Law of the
State of Delaware.
Based upon and subject to the foregoing, I am of the opinion that the
Shares have been duly authorized and, when issued and paid for in accordance
with the Plan, will be validly issued, fully paid and nonassessable.
This opinion is delivered in accordance with the requirements of Item
601(b)(5) of Regulation S-K under the 1933 Act and is furnished to you solely
for your benefit in connection with the filing of the Registration Statement and
is not to be used, circulated, quoted or otherwise referred to for any other
purpose without my prior written consent. I hereby consent to the filing of this
opinion with the Commission as Exhibit 5 to the Registration Statement. I also
consent to the reference to me under the heading "Legal Matters" in the
Registration Statement. In giving this consent, I do not thereby admit that I am
included in the category of persons whose consent is required under Section 7 of
the 1933 Act or the rules and regulations of the Commission promulgated
thereunder.
Very truly yours,
/s/ LINDA S. PETERSON
Linda S. Peterson
<PAGE>
CONSENT OF INDEPENDENT PUBLIC ACCOUNTANTS
As independent public accountants, we hereby consent to the incorporation
by reference in this registration statement of our reports dated February 16,
1998, included and incorporated by reference in Occidental Petroleum
Corporation's Form 10-K for the year ended December 31, 1997 and to all
references to our Firm included in this registration statement.
ARTHUR ANDERSEN LLP
Los Angeles, California
February 22, 1999
<PAGE>
EXHIBIT 99.1
OCCIDENTAL PETROLEUM CORPORATION
--------------------------------
SAVINGS PLAN
------------
Amended and Restated Effective
October 20, 1998
001T.MSW
<PAGE>
OCCIDENTAL PETROLEUM CORPORATION SAVINGS PLAN
---------------------------------------------
TABLE OF CONTENTS
-----------------
ARTICLE SECTION PAGE
- ------- ------- ----
1 Establishment of Plan
---------------------
1.1 Restatement of the Plan 1
1.2 Purpose of the Plan 1
1.3 Applicability of the Plan 1
2 Definitions
-----------
2.1 Definitions 2
2.2 Gender and Number 14
3 Participation and Service
-------------------------
3.1 Date of Participation 15
3.2 Duration 15
3.3 Transfers 16
3.4 Service 16
4 Pretax Deferrals, After-Tax Contributions and Adjustment
--------------------------------------------------------
Contributions
-------------
4.1 Pretax Deferrals and After-Tax Contributions 21
4.2 Pretax Deferral and After-Tax Contribution 21
Election Procedures
4.3 Discontinuance or Change in Rate of Pretax 21
Deferrals and After-Tax Contributions
4.4 Salary Reduction 22
4.5 Individual Maximum Pretax Deferrals 22
and After-Tax Contributions
4.6 Discrimination Limits on Pretax Deferrals 23
4.7 Discrimination Limits on Matching Contributions, 26
After-Tax Contributions, and Adjustment
Contributions
4.8 Multiple Use Limitation 27
4.9 Reductions to Pretax Deferrals and After-Tax 28
Contributions
4.10 Deposit of Pretax Deferrals, After-Tax 31
Contributions and Adjustment Contributions
4.11 Crediting of Pretax Deferrals, After-Tax 31
Contributions and Adjustment Contributions
4.12 Distribution of Excess Deferrals 31
i
<PAGE>
OCCIDENTAL PETROLEUM CORPORATION SAVINGS PLAN
---------------------------------------------
TABLE OF CONTENTS
-----------------
ARTICLE SECTION PAGE
- ------- ------- ----
5 Employer Matching Contributions
-------------------------------
5.1 Employer Matching Contributions 33
5.2 Deposit of Employer Matching Contributions 33
5.3 Crediting of Employer Matching Contributions 33
5.4 Forfeitures 33
5.5 Limitation on Annual Additions 34
5.6 "Annual Addition" Defined 34
5.7 Other Defined Contribution Plans 35
5.8 Defined Benefit Plans 35
5.9 Deductibility Limitation 36
5.10 Adjustment of Allocations 36
6 Vesting and Benefits
--------------------
6.1 Vesting 37
6.2 Benefits Upon Separation from Service 41
6.3 Forfeiture of Contingent Interests 42
6.4 Death Benefits 43
6.5 Forms of Payment 44
6.6 Time of Payment of Benefits 49
6.7 Withdrawals 49
6.8 Debiting of Investment Funds 51
6.9 Small Amounts 52
7 Participant Loans
-----------------
7.1 Eligibility 53
7.2 Loan Amount 53
7.3 Loan Terms 53
7.4 Source of Loan Funds and Valuation 54
7.5 Loan Account 55
7.6 Repayments 55
7.7 Leave of Absence 57
7.8 Separation from Service 57
7.9 Delinquent Payments 58
7.10 Discontinuance 59
8 Investment Elections
--------------------
8.1 Investment of Contributions 60
8.2 Transfers of Existing Balances 60
8.3 Transfer of Assets 62
ii
<PAGE>
OCCIDENTAL PETROLEUM CORPORATION SAVINGS PLAN
---------------------------------------------
TABLE OF CONTENTS
-----------------
ARTICLE SECTION PAGE
- ------- ------- ----
9 Participant Accounts and Records of the Plan
--------------------------------------------
9.1 Accounts and Records 63
9.2 Account Value 63
9.3 Investment Funds 63
9.4 Valuation Adjustments 64
9.5 Accounting Change 64
9.6 Loan Accounts 64
9.7 OPC Stock Fund Valuation 65
9.8 Cost Account 65
9.9 Rollovers 66
9.10 Merger of the MidCon Corp. ESOP 67
10 Financing
---------
10.1 Financing 68
10.2 Employer Contributions 68
10.3 OPC Stock Fund 68
10.4 Non-Reversion 70
10.5 Direct Transfer of Assets from Plans of Acquired 71
Entities
11 Administration
--------------
11.1 The Administrative Committee 72
11.2 Chairman, Secretary, and Employment of 72
Specialists
11.3 Compensation and Expenses 72
11.4 Manner of Action 73
11.5 Subcommittees 73
11.6 Other Agents 73
11.7 Records 73
11.8 Rules 73
11.9 Administrative Committee's Powers and Duties 73
11.10 Investment Responsibilities 75
11.11 Committees' Decisions Conclusive 76
11.12 Indemnity 76
11.13 Fiduciaries 76
11.14 Notice of Address 77
11.15 Data 77
11.16 Benefit Claims Procedures 78
11.17 Member's Own Participation 79
iii
<PAGE>
OCCIDENTAL PETROLEUM CORPORATION SAVINGS PLAN
---------------------------------------------
TABLE OF CONTENTS
-----------------
ARTICLE SECTION PAGE
- ------- ------- ----
12 Amendment and Termination
-------------------------
12.1 Amendment and Termination 80
12.2 Distribution on Termination 80
12.3 Successors 80
12.4 Plan Merger or Transfer 81
12.5 Participating Affiliates 81
13 Top-Heavy Provisions
--------------------
13.1 Application of Top-Heavy Provisions 82
13.2 Key Employees 82
13.3 Top-Heavy Group 83
13.4 Additional Rules 84
13.5 Combined Limit on Contributions and 84
Benefits for Key Employees
13.6 Minimum Contributions 84
14 Miscellaneous Provisions
------------------------
14.1 Employment Rights 85
14.2 No Examination or Accounting 85
14.3 Investment Risk 85
14.4 Non-Alienation 85
14.5 Incompetency 85
14.6 Severability 86
14.7 Counterparts 86
14.8 Service of Legal Process 86
14.9 Headings of Articles and Sections 87
14.10 Applicable Law 87
14.11 Unclaimed Benefits 87
14.12 Qualified Military Service 87
Appendix 1 Participation and Vesting for Certain Employees 88
Under Glenn Springs Sale Agreement
iv
<PAGE>
OCCIDENTAL PETROLEUM CORPORATION
--------------------------------
SAVINGS PLAN
------------
Article 1. Establishment of Plan
--------------------------------
1.1 Restatement of the Plan. OCCIDENTAL PETROLEUM CORPORATION hereby
amends and restates the Occidental Petroleum Corporation Savings Plan
(hereinafter referred to as the "Plan") for the benefit of Eligible Employees,
effective as of October 20, 1998.
1.2 Purpose of the Plan. This Plan is intended to encourage and
assist Eligible Employees in adopting a regular program of savings to provide
additional security for their retirement.
1.3 Applicability of the Plan. Except as otherwise provided herein,
the provisions of this Plan are applicable only to Eligible Employees in the
employ of the Company and selected Affiliates on or after January 1, 1984.
1
<PAGE>
Article 2. Definitions
----------------------
2.1 Definitions. Whenever used in the Plan the following terms shall
have the respective meanings set forth below unless otherwise required by the
context in which they are used:
(a) "Accounting Date" shall mean the business day coincident with or
next preceding the fifteenth day of each month and the last day
of each month.
(b) "Adjustment Contributions" shall mean Pretax Deferrals which are
converted to After-Tax Contributions in order to comply with
limitations under Code section 415 or to comply with
nondiscrimination tests of Code section 401(k).
(c) "Administrative Committee" means the committee appointed by the
Board to administer the Plan in accordance with the applicable
provisions of Article 11 of this Plan.
(d) "Affiliate" shall mean a corporation or other employer which is
controlled by or under common control with the Company, within
the meaning of sections 414 and 1563 of the Code. The
determination of control shall be made without reference to
paragraphs (a)(4) and (e)(3)(C) of section 1563, and solely for
the purpose of applying the limitations of sections 5.5 through
5.8 of this Plan, the phrase "more than 50 percent" shall be
substituted for the phrase "at least 80 percent" each place it
appears in section 1563(a)(1). In addition, to the extent that
the context may so require, "Affiliate" shall mean any member of
an affiliated service group (within the meaning of section 414(m)
of the Code) to which the Company belongs, and any corporation,
trade or business which is more than 50 percent owned, directly
or indirectly, by the Company and is designated by the Board as
an Affiliate.
(e) "After-Tax Contributions" shall mean the amount a Participant
requests the Company to contribute on his behalf on an after-tax
basis in accordance with section 4.1.
2
<PAGE>
(f) "Alternate Payee" shall have the same meaning as assigned to that
term in section 414(p)(8) of the Code.
(g) "Beneficiary" means the person or persons (who may be named
contingently or successively) designated by a Participant, an
Alternate Payee, or a beneficiary of a deceased Participant or a
deceased Alternate Payee to receive his Personal Savings Account
in the event of his death. Each Participant, Alternate Payee, and
beneficiary of a deceased Participant or Alternate Payee, except
married Participants prior to the day they reach age 35, may
designate at any time, and any number of times, a beneficiary on
a form prescribed by the Administrative Committee, and such
designation will be effective only when filed in writing with the
Administrative Committee, and shall revoke all prior designations
by the same Participant or Alternate Payee. The Administrative
Committee shall require that a married Participant who designates
a Beneficiary other than his spouse obtain and submit to the
Administrative Committee the spouse's notarized written consent
to the designation on a form that discloses to the spouse the
potential effect of such consent. If a Participant is married and
is under age 35, then his Beneficiary shall be his spouse. If no
Beneficiary is designated at the time of the Participant's or
Alternate Payee's death, or at the time of death of the
beneficiary of a deceased Participant or Alternate Payee, or if
no person so designated shall survive the Participant, Alternate
Payee, or beneficiary of a deceased Participant or Alternate
Payee, the Beneficiary shall be his spouse, or if the deceased
individual has no surviving spouse, his surviving children
equally, or if there are no surviving children, his surviving
parents equally, or if only one parent is living, his living
parent, or if no parent is living, his surviving siblings
equally, or if only one sibling is living, his surviving sibling,
or if no sibling is living, his estate.
(h) "Board of Directors" or "Board" means the Board of Directors of
Occidental Petroleum Corporation.
3
<PAGE>
(i) "Code" shall mean the Internal Revenue Code of 1986, as amended.
(j) "Company" means Occidental Petroleum Corporation.
(k) "Compensation" means the base salary and wages earned by a
Participant from an Employer for services rendered, including
amounts of Pretax Deferrals and amounts contributed pursuant to
the Occidental Petroleum Corporation Pretax Spending Program, but
excluding (i) bonuses, incentives, overtime, shift differential,
and overseas differentials, (ii) reimbursement for expenses or
allowances, including automobile allowances and moving
allowances, (iii) any amount contributed by the Employer (other
than Pretax Deferrals and amounts contributed pursuant to the
Occidental Petroleum Corporation Pretax Spending Program) to any
pension plan or plan of deferred compensation, (iv) any amount
contributed by an Employer (in addition to Pretax Deferrals) to
this Plan, and (v) any amount paid by an Employer for other
fringe benefits, such as health and hospitalization, and group
life insurance benefits, or perquisites, provided that earnings
of a Participant in excess of $160,000, or such higher amount as
shall be permitted by the Secretary of the Treasury, in any Plan
Year shall not be included in Compensation. Compensation will be
determined in accordance with the following rules:
(1) For Participants compensated by salary, the amount of
Compensation shall be base salary of record for each pay
period, provided, however, that for any salaried Participant
whose salary is reduced for a pay period (for reasons other
than the making of Pretax Deferrals and contributions
pursuant to the Occidental Petroleum Corporation Pretax
Spending Program), Compensation will include his actual base
salary of record paid to him (subject to the exclusions
listed above) not in excess of his salary of record for such
pay period.
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<PAGE>
(2) For Participants compensated by commission (primarily truck
drivers), the amount of Compensation shall be the amount per
pay period (subject to the exclusions listed above) to be
reported on Form W-2 for federal tax purposes.
(3) For Participants compensated at an hourly rate, the amount
of Compensation in a pay period shall be the base hourly
rate (subject to the exclusions listed above) multiplied by
the number of regularly scheduled hours worked in a pay
period. If the Participant's regularly scheduled work week
is more than 40 hours, Compensation shall include an
additional amount equal to the base hourly rate (subject to
the exclusions listed above) times one half the number of
regularly scheduled hours worked in excess of 40 in the work
week.
(4) For Participants compensated on a Twelve Hour Shift Basis,
the amount of Compensation for each pay period shall be the
Participant's annual base salary of record (including
Guaranteed Overtime) divided by the number of pay periods
applicable to the Participant during the Plan Year. For the
purpose of this subsection 2.1(k), the term "Twelve Hour
Shift Basis" means any arrangement whereby Participants work
twelve hour daily shifts which may result in alternating
work weeks of more and less than forty hours per week.
Additionally, for the purpose of this subsection 2.1(k), the
term "Guaranteed Overtime" means compensation paid to a
Participant for overtime work which the Participant is
assigned at the beginning of the year to perform.
(5) Compensation shall include vacation pay received in periodic
payments and annual vacation payments made to commission
paid Employees, but shall not include single sum vacation
payments to active or terminating Employees.
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(6) Compensation shall include base salary or wages received
during paid leaves of absence and periodic severance pay,
but will not include single sum severance payments.
(7) Compensation will not include long-term disability payments
and short-term disability payments of less than 100 percent
of base pay in effect prior to becoming Disabled.
(l) "Disability" or "Disabled" refers to any Participant who is
determined to be disabled under Section 423 of Title 42 of the U.
S. Code and who receives disability insurance benefits thereunder
or any Participant who is a participant in the Occidental
Petroleum Corporation Long-Term Disability Plan and who is
determined to be disabled therein under the definition of
"disability" applicable to the period beginning 24 months after
the commencement of disability and who receives benefits
thereunder. Such Participant shall be considered to be Disabled
as of the time of commencement of benefits as described above.
A Participant who claims to be Disabled as a result of being
determined to be disabled under Section 423 of Title 42 of the
U.S. Code must give written notice thereof to the Administrative
Committee and submit, at the expense of the Participant, to the
Administrative Committee such evidence of Disability as the
Administrative Committee may require. Failure by a Participant to
comply with the foregoing requirements shall be deemed conclusive
evidence that such Participant is not Disabled. All rules with
respect to the determination of Disability shall be uniformly and
consistently applied to all Participants in similar
circumstances.
(m) "Domestic Overseas Subsidiary" means any corporation or
unincorporated entity created or organized under the laws of the
United States, any State or territory of the United States, or of
the District of Columbia, (i) more than 80 percent of the
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<PAGE>
voting stock or equity of which is owned by an Employer which is
a domestic corporation, (ii) which has derived at least 95
percent of its gross income from sources without the United
States for the three year period immediately preceding the close
of each taxable year (or for such part of such period during
which the corporation or unincorporated entity was in existence),
and (iii) which has derived at least 90 percent of its gross
income during the period described in (ii) from the active
conduct of a trade or business.
(n) "Effective Date" means January 1, 1984.
(o) "Eligible Employee" means any Employee who is employed by an
Employer except:
(1) Employees covered by a collective bargaining agreement where
retirement benefits were the subject of good faith
bargaining between the Employer and the union, unless such
agreement expressly provides participation in the Plan;
(2) Nonresident alien Employees of an Employer which is a
Foreign Subsidiary or Domestic Overseas Subsidiary who
receive no earned income from the Employer in United States
dollars, unless the Plan has been made applicable to such an
Employee by the Employer;
(3) Employees of a Foreign Subsidiary or Domestic Overseas
Subsidiary who are citizens of the United States or Canada
and for whom contributions are made under a funded plan of
deferred compensation by a corporation which is not an
Employer;
(4) Citizens of the United Kingdom who are on work assignments
under three years' duration in locations outside the United
Kingdom, other than the United States, irrespective of
whether employed by an Employer which is a Foreign
Subsidiary or a Domestic Overseas Subsidiary and
irrespective of whether receiving earned income from the
Employer in United States
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<PAGE>
dollars. For the purpose of this paragraph (4), the duration
of a work assignment shall be based on its estimated
duration as determined at the time of its commencement;
(5) Employees of Oxy Westwood Corporation other than those
Employees who were Eligible Employees immediately prior to
their transfer to Oxy Westwood Corporation from an Employer.
Notwithstanding the preceding sentence, Employees of Oxy
Westwood Corporation who were Eligible Employees on June 30,
1989, or who are hired by Oxy Westwood Corporation at any
time thereafter under circumstances where it is agreed at
the time of hire that they will be Eligible Employees, shall
continue to be Eligible Employees thereafter so long as they
remain so employed; and
(6) Effective as of July 1, 1990, any Eligible Employee who
elects, pursuant to an employment agreement with the Company
or any other Employer, not to be a Participant.
Notwithstanding any other provision of this subsection 2.1(o), no
individual shall be an Eligible Employee if such individual is
not classified as a common-law employee in the employment records
of the Company or an Affiliate, without regard to whether the
individual is subsequently determined to have been a common-law
employee of the Company or an Affiliate. The persons excluded by
this paragraph from being Eligible Employees are to be
interpreted broadly to include and to have at all times included
individuals engaged by the Company or an Affiliate to perform
services for such entity in a relationship that the entity
characterizes as other than an employment relationship, such as
where the Company or the Affiliate engages the individual to
perform services as an independent contractor or leases the
individual's services from a third party. The exclusion of the
individual from being an Eligible Employee shall apply even if a
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<PAGE>
determination is subsequently made by the Internal Revenue
Service, another governmental agency, a court or other tribunal,
after the individual is engaged to perform such services, that
the individual is an employee of the Company or Affiliate for
purposes of pertinent Code sections or for any other purpose.
(p) "Employee" means any person employed by the Company or by an
Affiliate.
(q) "Employer" means the Company and any Affiliate which is
designated by the Board or the Administrative Committee and which
adopts this Plan.
(r) "ERISA" means the Employee Retirement Income Security Act of
1974, as from time to time amended.
(s) "Foreign Subsidiary" means any corporation or unincorporated
entity created or organized under the laws of any country other
than the United States which is covered by an agreement between
the domestic parent of the Foreign Subsidiary and the Internal
Revenue Service extending Federal Social Security benefits to the
employees of such foreign corporation or unincorporated entity
who are United States citizens and either (i) not less than 20
percent of the voting stock or equity of such foreign corporation
or unincorporated entity is owned by an Employer which is a
domestic corporation or (ii) more than 50 percent of the voting
stock or equity of such foreign corporation or unincorporated
entity is owned by a foreign corporation or unincorporated entity
which qualifies as a Foreign Subsidiary under clause (i) above.
(t) "Inactive Participant" means an Employee who was a Participant
but who is transferred to and is in a position of employment
where he is no longer an Eligible Employee.
(u) "Investment Committee" shall mean the committee appointed by the
Board to administer the investments of the Retirement Plan.
(v) "Investment Fund" means any of the following funds of the Trust
Fund or such other funds as the Investment Committee may from
time to time designate:
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<PAGE>
(1) A "Fixed Income Fund" which shall be invested in stable
value contracts which state a given interest rate to be paid
on account balances.
(2) A "Small Cap Stock Fund" which shall be invested in equity
securities of small capitalization companies, as well as
stock index options and futures.
(3) An "OPC Stock Fund" which shall be invested primarily in
Stock and such short-term interest-bearing securities as the
Investment Committee or the Trustee considers advisable.
(4) A "Standard & Poor's 500 Index Fund" which shall be invested
in the Bank of America Equity Index Fund, and shall be
designed to approximate the performance of the publicly
traded United States common stocks that comprise the
Standard & Poor's 500 Index.
(5) A "Fidelity Puritan Fund" which shall be invested in shares
of the mutual fund managed by Fidelity Management & Research
Company which bears this name.
(6) A "Fidelity Asset Manager: Growth Fund" which shall be
invested in shares of the mutual fund managed by Fidelity
Management & Research Company known as Fidelity Asset
Manager: Growth.
(7) A "Fidelity Magellan Fund" which shall be invested in shares
of the mutual fund managed by Fidelity Management & Research
Company which bears this name.
(8) A "Fidelity Contrafund" which shall be invested in shares of
the mutual fund managed by Fidelity Management & Research
Company which bears this name.
(9) An "International Growth Fund" which shall be invested in
shares of the mutual fund managed by Putnam Investment
Management, Inc. known as the Putnam International Growth
Fund.
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<PAGE>
(10) A "Large Cap Value Fund" which shall be invested in common
stocks of a small number of well-established United States
companies.
(w) "Loan Account" means the account created under section 7.5
representing the unpaid principal outstanding on a loan to an
Employee.
(x) "MidCon Corp. ESOP" means the MidCon Corp. Employee Stock
Ownership Plan as effective November 20, 1996.
(y) "Participant" means any Eligible Employee who has met the
requirements to become a Participant as set forth in section 3.1
hereof, and shall include, where appropriate to the context, any
former Participant described in section 3.2.
(z) "Personal Savings Account" or "Account" means the Account or
Accounts maintained for each Participant which represent his
total proportionate interest in the Trust Fund as of any date and
which consist of the sum of the following:
(1) "Matching Account" means an account to which Employer
matching contributions made on behalf of the Participant,
including matching contributions under this Plan (or any
other plan which may be merged into this Plan) prior to the
Effective Date, shall be credited, along with earnings as
provided in Article 9.
(2) "Pretax Deferral Account" means an account to which Pretax
Deferrals made on behalf of the Participant shall be
credited, along with earnings as provided in Article 9.
(3) "Employee Account" means an account to which After-Tax
Contributions made by the Participant, including Adjustment
Contributions and After-Tax contributions made under this
Plan (or any other plan which may be merged into this Plan)
prior to the Effective Date, shall be credited, along with
earnings as provided in Article 9.
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<PAGE>
(4) "Rollover Account" means an account to which a Participant
has transferred amounts from another employee benefit plan
pursuant to section 9.9.
The term "Personal Savings Account" or "Account" shall also mean
a separate account which is established pursuant to a qualified
domestic relations order on behalf of an Alternate Payee. For the
purpose of this subsection 2.1(z), the term "qualified domestic
relations order" shall have the same meaning as assigned to that
term in section 414(p) of the Code.
(aa) "Plan Year" means the calendar year.
(bb) "Pretax Deferrals" means the amount a Participant requests the
Company to defer on his behalf on a pretax basis in accordance
with section 4.1.
(cc) "Retirement Plan" means the Occidental Petroleum Corporation
Retirement Plan.
(dd) "Separation from Service" shall mean any termination of the
employment relationship between an Employee and the Company or an
Affiliate and shall be deemed to occur upon the earlier of:
(1) the date upon which the Employee quits, is discharged, is
laid off, becomes Disabled or dies; or
(2) the first anniversary of the first day of a period in which
the Employee is (and remains) absent from the Service of the
Company or an Affiliate for any reason (such as vacation,
sickness, or leave of absence granted by the Company or an
Affiliate) not enumerated in paragraph (1), provided that if
an Employee is granted a leave of absence but fails to
return to employment at the end of the leave period,
Separation from Service will be deemed to have occurred upon
the date the Employee was originally granted a leave of
absence.
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<PAGE>
The term Separation from Service shall include any cessation of
participation occurring as a result of an event described in Code
section 401(k)(10)(A).
An Employee of an Employer who transfers to a nonparticipating
Affiliate shall not be treated as having a Separation from
Service. An Employee's date of quit or discharge shall not be
deemed to occur until any periodic severance payments or
short-term disability payments cease. An Employee who is on leave
of absence from work with the Company or an Affiliate in order to
serve the Armed Forces of the United States shall not have a
Separation from Service unless he fails to report for work at the
end of such leave and prior to expiration of the period in which
he has reemployment rights under law. The absence of any Employee
who fails to return to work within the allotted time shall be
subject to the provisions of paragraph (2) above.
(ee) "Service" means the periods of employment credited to an Employee
under section 3.4.
(ff) "Stock" means the common stock of Occidental Petroleum
Corporation.
(gg) "Taxable Compensation" means the total cash and non-cash
remuneration paid to a Participant by the Employer for services
rendered during the Plan Year, but excluding:
(1) Company contributions for a simplified employee pension;
(2) Deferred compensation (other than an amount included in the
Participant's gross income for the Plan Year which is
attributable to an unfunded, non-qualified plan);
(3) Amounts realized from the exercise of a non-qualified stock
option, or when restricted stock (or property) held by an
Employee becomes freely transferable or is no longer subject
to a substantial risk or forfeiture;
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<PAGE>
(4) Amounts realized from the sale, exchange or other
disposition of stock under a tax-benefited stock option; and
(5) Other amounts which receive special tax benefits.
(hh) "Trust Agreement" means any agreement in the nature of a trust
established to form a part of the Plan to receive, hold, invest,
and dispose of the Trust Fund.
(ii) "Trust Fund" means the assets of every kind and description held
under any Trust Agreement forming a part of the Plan.
(jj) "Trustee" means any person selected by Occidental Petroleum
Corporation to act as Trustee under any Trust Agreement at any
time of reference.
2.2 Gender and Number. Except when otherwise indicated by the
context, any masculine terminology herein shall also include the feminine, and
the definition of any term herein in the singular shall also include the plural.
14
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Article 3. Participation and Service
------------------------------------
3.1 Date of Participation. Each Eligible Employee shall become a
Participant as of the first day of the month in which he becomes an Eligible
Employee.
Notwithstanding anything herein to the contrary, each Employee who became an
Eligible Employee by virtue of the provisions of (a) the Agreement of Purchase
and Sale between Tenneco Polymers, Inc. and Occidental Chemical Corporation
dated March 21, 1986, (b) the Agreement and Plan of Reorganization among MidCon
Corp., Occidental Petroleum Corporation, a California corporation, and OPCO
Acquisition Corp., dated December 31, 1985, (c) the Stock Purchase Agreement By
and Among Diamond Shamrock Corporation, Occidental Petroleum Corporation,
Occidental Chemical Holding Corporation and Oxy-Diamond Alkali Corporation dated
September 4, 1986, or (d) the Agreement and Plan of Reorganization and Merger by
and among Occidental Petroleum Corporation, Canaan Mining Company, and Virginia
Electric and Power Company dated September 15, 1986, shall become a Participant,
in the case of Eligible Employees subject to agreement (a) above, as of April
30, 1986; in the case of Eligible Employees subject to agreement (b) above, as
of January 1, 1987; in the case of Eligible Employees subject to agreement (c)
above, as of September 4, 1986; and in the case of Eligible Employees subject to
agreement (d) above, as of September 15, 1986.
For purposes of the Plan, an individual on whose behalf amounts are transferred
to the Plan pursuant to section 9.10 shall be deemed a Participant for all
purposes with respect to such amounts, but in no event shall such Participant be
eligible for any contributions hereunder unless such individual becomes an
Eligible Employee and satisfies the requirements of this section 3.1.
3.2 Duration. An Eligible Employee who becomes a Participant shall
remain a Participant for as long as he remains an Eligible Employee or is
entitled to receive any contributions or benefits hereunder.
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<PAGE>
3.3 Transfers. An Employee who transfers to employment as an
Eligible Employee shall become a Participant on the first day of the month in
which such transfer takes place.
An Inactive Participant shall not make Pretax Deferrals, After-Tax Contributions
or Adjustment Contributions on the Compensation earned after the date of his
transfer during the period he is an Employee, but shall continue to accrue
Service under this Plan. Upon his Separation from Service, the vested interest
he has in his Personal Savings Account shall be based on his total Service.
If a Participant becomes an Inactive Participant, his Account shall continue to
be held under the Plan until he becomes entitled to a distribution under the
provisions of section 6.2.
3.4 Service. Service is used to determine an Employee's eligibility
to receive benefits from the Plan.
An Employee shall be credited with Service for the period of time during which
the employment relationship exists between the Employee and the Company or an
Affiliate, the length of which shall be determined, in completed years and
months, during the following periods of time:
(a) Credit shall be given to an Employee for the period of time
beginning on the first day of the month in which he first becomes
an Employee and ending on the last day of the month of such
Employee's Separation from Service.
(b) Credit shall be given to an Employee for each period beginning
upon the date he Separates from Service and ending upon the first
day of the month in which he first becomes an Employee thereafter
but only if the Employee is reemployed within 12 months of the
date of such Separation from Service.
(c) Credit shall be given to an Employee after a Separation from
Service for any period beginning on the first day of the month in
which the Employee first
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<PAGE>
becomes an Employee after his rehire and ending on the last day
of the month the Employee has a Separation from Service
thereafter as provided in section 2.1(dd).
(d) Whenever the total number of years of Service of an Employee must
be ascertained under this Plan, all noncontinuous periods of
Service which are credited to such Employee under paragraphs (a),
(b) and (c) above, shall be aggregated. For purposes of
aggregating such years of Service, the completed years and months
credited to an Employee during any period of Service shall be
added to the number of completed years and months credited to him
during any other period of noncontinuous Service.
Notwithstanding the foregoing provisions of this section, an Employee shall be
credited with Service for the period of time during which an employment
relationship existed between the Employee and the following entities or
subsidiaries thereof, irrespective of whether the entity was an Affiliate at the
time the employment relationship was in existence:
Beatrice Pocahontas Company
Bird Coal Company
Black Lode Coal Co., Inc.
Cain Chemical Inc.
Cities Service Company
Curtis Bay Company
Diamond Shamrock Chemicals Company
ENOXY Coal, Inc.
ENOXY Coal Sales, Inc.
Garden Creek Gas Company
Garden Creek Pocahontas Company
Island Creek Coal Company
Island Creek Coal Sales Company
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Island Creek Corporation
Island Creek of China Coal Ltd.
Island Creek Pocahontas Company
Kentucky-Ohio Transportation Co.
Laurel Run Mining Company
MidCon Corp.
Sheridan Enterprises, Inc.
Tenneco Polymers, Inc.
Twin Branch Coal Company
Twin River Coal Company
Vail Mining Company
Virginia Pocahontas Company
Welco Mining Company
provided, however, that any Employee who was eligible to participate in this
Plan or in the Employees Thrift Plan of Cities Service Company at any time prior
to January 1, 1984, or in the Employees Thrift Plan of Island Creek Coal Company
prior to April 1, 1984, shall, as of January 1, 1984, be entitled to credit for
the greater of the amount of Service determined above or the vesting service he
had under such plan during any such period of eligibility, plus one additional
year of Service under this section. In the case of those certain Eligible
Employees who were hired on or about March 21, 1986 as a result of the Agreement
of Purchase and Sale between Tenneco Polymers, Inc. and Occidental Chemical
Corporation, Service shall be credited for all service recognized under the
Tenneco Inc. Thrift Plan. In the case of those certain Eligible Employees who
were hired on or about June 12, 1987 as a result of the Agreement of Purchase
and Sale between Shell Oil Company and Occidental Electrochemicals Corporation,
Service shall be credited for the period of time during which an employment
relationship existed between those Eligible Employees and Shell Oil Company. In
the case of Participants who were participants in the Cain Chemical Inc. Savings
and Investment Plan, Service shall include any
18
<PAGE>
service recognized under that plan for the purpose of determining vesting in
employer contributions. In the case of those certain Eligible Employees who were
hired on or about September 29, 1989 as a result of the Asset Purchase Agreement
between Occidental Chemical Corporation and BTL Specialty Resins Corp., Service
shall be credited for all service recognized under the BTL Specialty Resins
Corp. Salaried Employees' Pension Plan. In the case of those certain Eligible
Employees who were hired on or about December 13, 1989 as a result of the
Agreement and Contract of Sale by and between Smackover Shell Limited
Partnership, OXY NGL Inc., and Prairie Alba Company, Service shall be credited
for all service recognized under the Shell Pension Plan. In the case of those
Eligible Employees who were considered to be "Employees Hired by Purchaser" as
defined in section 9.2 of the Asset Purchase Agreement dated as of December 30,
1992 between Occidental Chemical Corporation and Monsanto Company ("Monsanto"),
Service shall be credited for the period during which each such Eligible
Employee was employed by Monsanto. In the case of those Eligible Employees who
were "Employees" as defined in Section 6.7(a) of the Exchange Agreement among
Occidental Petroleum Corporation, Placid Oil Company and the Stockholders of
Placid Oil Company dated November 22, 1994, Service shall be credited for the
period during which each such Eligible Employee was employed by Placid Oil
Company or its subsidiaries or affiliates, as provided in Section 6.7(c) of such
exchange agreement. In the case of those Eligible Employees who were "Employees"
as defined in Section 5.5(a) of the Agreement of Merger by and among Laurel
Industries, Inc., Occidental Petroleum Corporation and Oxy Acquisition Corp.
dated August 5, 1996, Service shall be credited for the period during which each
such Eligible Employee was employed by Laurel Industries, Inc., as provided in
Section 5.5(d) of such agreement. In the case of those Eligible Employees who
were "Employees" as defined in Section 6.7(a) of the Agreement and Plan of
Merger among Occidental Petroleum Corporation, OPC Acquisition Corp., Helmerich
& Payne, Inc. and Natural Gas Odorizing, Inc. dated August 23, 1996, Service
shall be credited for the period during which each such Eligible Employee was
employed by Natural Gas Odorizing, Inc. or Helmerich & Payne, Inc., as provided
in Section 6.7(d) of such
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<PAGE>
agreement. In the case of those Eligible Employees who were "Transferred
Employees" as defined in Section 6.6(b) of the Asset Purchase Agreement between
and among Power Silicates Manufacturing, Inc., as "Seller," and Occidental
Chemical Corporation, as "Buyer" dated August 30, 1996, Service shall be
credited for the period during which each such Eligible Employee was employed by
Power Silicates Manufacturing, Inc., as provided in Section 6.6(d) of such
agreement.
Notwithstanding the foregoing provisions of this section, in the case of those
former Participants who were employed by Trident NGL Inc. pursuant to the
"Agreement on Employment, Employee Benefits and Wages" dated as of August 30,
1991 between OXY USA Inc. and Trident NGL Inc., Service shall be credited for
the period during which such former Participant remains employed by Trident NGL
Inc.
Notwithstanding the foregoing provisions of this section, in the case of those
former Eligible Employees who were hired on July 1, 1992 by Treatek-CRA Company
("Treatek-CRA"), Service shall be credited for the period during which each such
former Eligible Employee remains employed by Treatek-CRA.
20
<PAGE>
Article 4. Pretax Deferrals, After-Tax Contributions and
--------------------------------------------------------
Adjustment Contributions
------------------------
4.1 Pretax Deferrals and After-Tax Contributions. Each Participant
may elect to have the Company contribute to the Plan on his behalf each Plan
Year an amount, in whole percentage points, equal to 1 percent to 12 percent of
his Compensation (or 1 percent to 6 percent of his Compensation in the case of a
Participant who is a participant in the Occidental Petroleum Corporation
Supplemental Retirement Plan) as a Pretax Deferral or After-Tax Contribution, or
any combination in whole percentage points, in accordance with the rules set
forth in sections 4.2, 4.5 and 4.6 and such other rules as the Administrative
Committee may prescribe.
4.2 Pretax Deferral and After-Tax Contribution Election Procedures.
Elections shall be made available by the Administrative Committee to
Participants and to Employees expected to become Participants. Elections must be
made in accordance with procedures established by the Administrative Committee.
All elections shall apply to Compensation earned during the payroll period
within which the election is processed, and all elections shall be irrevocable
for such period.
If a Participant has a Separation from Service, becomes an Inactive Participant,
or goes on unpaid leave of absence, his Pretax Deferrals, After-Tax
Contributions and Adjustment Contributions shall cease, unless he is reinstated
as a Participant or returns from his leave of absence during the Plan Year, in
which case his Pretax Deferrals, After-Tax Contributions and Adjustment
Contributions may resume.
4.3 Discontinuance or Change in Rate of Pretax Deferrals and
After-Tax Contributions. Pretax Deferral and After-Tax Contribution elections
shall apply automatically to each subsequent payroll period unless a new
election (which may increase, decrease or cancel Pretax Deferrals or After-Tax
Contributions) is filed with the Administrative Committee in accordance with
this section.
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<PAGE>
A Participant may suspend his Pretax Deferrals, After-Tax Contributions and
Adjustment Contributions on the first day of any payroll period by giving notice
in accordance with procedures established by the Administrative Committee. Such
suspension may last indefinitely. A Participant may resume his Pretax Deferrals,
After-Tax Contributions and Adjustment Contributions on the first day of any
payroll period after the effective date of the prior suspension, by giving
notice in accordance with procedures established by the Administrative
Committee.
A Participant may change the rate of his Pretax Deferrals, After-Tax
Contributions and Adjustment Contributions to a different percentage that is
permitted under section 4.1 as of the first day of any payroll period. Such
change shall be made by submitting a new election in accordance with procedures
established by the Administrative Committee.
4.4 Salary Reduction. Each Participant who makes a Pretax Deferral
election described in section 4.1 to have the Employer contribute a percentage
of his Compensation to this Plan shall, by the act of making such election, have
his salary reduced by an equivalent percentage for so long as the election
remains in effect.
4.5 Individual Maximum Pretax Deferrals and After-Tax Contributions.
The Pretax Deferral and After-Tax Contribution election of a Participant shall
be adjusted in whole percentages, if necessary, from time to time as determined
by the Administrative Committee so that such Pretax Deferrals and After-Tax
Contributions for the Plan Year will not exceed (a) less (b) below, where:
(a) is the lesser of,
(1) 25 percent of Taxable Compensation, or
(2) $30,000 (or such other dollar maximum as may be permitted by
the Internal Revenue Service), and
(b) is the sum of:
22
<PAGE>
(1) Employer contributions projected for the Participant as if
he were a Participant under the Retirement Plan for a full
Plan Year; plus
(2) Matching contributions expected to be allocated to the
Participant under this Plan (based on any such allocations
already made and the Participant's current Pretax Deferral
and After-Tax Contribution election) for a full Plan Year.
Any adjustment in the elected percentage of a Participant, and the resulting
adjustment in salary reduction under section 4.4, shall take effect in the month
of such adjustment calculation and shall remain in effect as a maximum Pretax
Deferral level for the Participant for the rest of the Plan Year, unless further
adjusted by the Administrative Committee. In the case of a Participant who has
elected Pretax Deferrals and After-Tax Contributions in the same Plan Year, any
adjustment which must be made under this section for a Participant shall be made
first to the Participant's After-Tax Contributions. If additional adjustments
are required under this section after the Participant's After-Tax Contributions
percentage is reduced to zero, such adjustments shall be made to the
Participant's Pretax Deferrals.
Notwithstanding anything herein to the contrary, under no circumstances may a
Participant's Pretax Deferral in any calendar year exceed $10,000 (or such
higher amount as the Secretary of the Treasury shall establish from time to time
pursuant to Code section 402(g)(5)).
4.6 Discrimination Limits on Pretax Deferrals. Prior to the
beginning of each Plan Year and at any other time during the Plan Year that the
Administrative Committee may deem appropriate, the following test shall be made
to prevent the Pretax Deferrals under the Plan from becoming discriminatory.
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<PAGE>
In no event shall any Employer make Pretax Deferrals for any Plan Year that
would result in the actual deferral percentage ("ADP") for the Plan Year of the
group of Highly Compensated Employees eligible to participate in the Plan
exceeding the greater of:
(A) For Plan Years beginning prior to January 1, 1998:
(i) One and one-quarter times the ADP for the current Plan Year of
the group of all other Eligible Employees; or
(ii) The lesser of (i) two times the ADP for the current Plan Year of
the group of all other Eligible Employees, or (ii) the ADP for
the current Plan Year of the group of all other Eligible
Employees plus two percentage points.
(B) For Plan Years beginning after December 31, 1997:
(i) One and one-quarter times the ADP for the preceding Plan Year of
the group of all other Eligible Employees; or
(ii) The lesser of (i) two times the ADP for the preceding Plan Year
of the group of all other Eligible Employees, or (ii) the ADP for
the preceding Plan Year of the group of all other Eligible
Employees plus two percentage points.
The ADP of each group of Eligible Employees for any Plan Year shall be the
average of the ratios (calculated separately for each Eligible Employee in each
group after making any adjustments required under section 4.5) of (I) the Pretax
Deferrals made on behalf of each Eligible Employee for such Plan Year to (II)
such Eligible Employee's ADP Testing Compensation, earned while such Employee
was an eligible employee within the meaning of Treasury regulation section
1.401(k)-1(g)(4)(i) for such Plan Year.
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<PAGE>
For purposes of making these determinations, an Employee will be considered to
be a "Highly Compensated Employee" in the current Plan Year if he:
(a) is a 5% Owner in the current or preceding Plan Year; or
(b) has Highly Compensated Test Compensation during the preceding
Plan Year of more than $80,000 (or such higher amount as the
Secretary of the Treasury shall establish from time to time
pursuant to Code section 414(q)(1)).
In applying the $80,000 limit described in subsection (b) above, the
Administrative Committee may elect to limit the determination of Highly
Compensated Employees to that group of Employees consisting of the top 20% of
such Employees ranked on the basis of Compensation received during the Plan
Year.
For the purposes of identifying "Highly Compensated Employees" and for applying
the ADP test described above, the following special rules and definitions will
apply:
(i) An Employee who has Separated from Service will continue to be a
Highly Compensated Employee if he was a Highly Compensated
Employee at the time he Separated from Service, or if he was a
Highly Compensated Employee at any time after he attained age 55.
This determination shall be based on the definition of highly
compensated employee under Code section 414(q) and related
regulations in effect for that determination year.
(ii) The term "current Plan Year" shall mean the Plan Year for which
the determination is being made.
(iii) The term "preceding Plan Year" shall mean the Plan Year
immediately preceding the current Plan Year.
(iv) An Employee shall be considered a "5% Owner" for a Plan Year if
at any time during such Plan Year he was a 5-percent owner (as
defined in Code section 416(i)(1)) of the Company.
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<PAGE>
(v) The term "Highly Compensated Test Compensation" shall mean
compensation within the meaning of Code section 415(c)(3).
(vi) The term "ADP Testing shall mean compensation within the meaning
of Code section 414(s)(1), except that the Administrative
Committee may elect not to include in such compensation any
amount which is contributed by the Employer pursuant to a salary
reduction agreement and which is not includable in gross income
of the Employee under Code section 125, 402(e)(3), 402(h), or
403(b).
4.7 Discrimination Limits on Matching Contributions, After-Tax
Contributions, and Adjustment Contributions. Prior to the beginning of each Plan
Year and at any other time during the Plan Year that the Administrative
Committee may deem appropriate, the following test shall be made to prevent
Employer matching contributions, After-Tax Contributions and Adjustment
Contributions under the Plan from becoming discriminatory.
In no event shall any Employer make matching contributions, After-Tax
Contributions and Adjustment Contributions for any Plan Year that would result
in the actual contribution percentage ("ACP") for the Plan Year of the group of
Highly Compensated Employees eligible to participate in the Plan exceeding the
greater of:
(A) For Plan Years beginning prior to January 1, 1998:
(i) One and one-quarter times the ACP for the current Plan Year of
the group of all other Eligible Employees; or
(ii) The lesser of (i) two times the ACP for the current Plan Year of
the group of all other Eligible Employees, or (ii) the ACP for
the current Plan Year of the group of all other Eligible
Employees plus two percentage points.
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<PAGE>
(B) For Plan Years beginning after December 31, 1997:
(i) One and one-quarter times the ACP for the preceding Plan Year of
the group of all other Eligible Employees; or (ii) The lesser of
(i) two times the ACP for the preceding Plan Year of the group of
all other Eligible Employees, or
(ii) the ACP for the preceding Plan Year of the group of all other
Eligible Employees plus two percentage points.
For purposes of making these determinations, the term "Highly Compensated
Employee" shall have the same meaning as set forth in section 4.6. The "ACP" for
a specified group of Eligible Employees for any Plan Year is the average of the
ratios (calculated separately for each Eligible Employee in such group) of the
sum of Employer matching contributions, After-Tax Contributions and Adjustment
Contributions paid for each such Eligible Employee for such Plan Year to the ADP
Testing Compensation paid to the Eligible Employee for such Plan Year, provided,
however, that in accordance with Treasury regulations, the Administrative
Committee may elect to take into account, in computing average contribution
percentage, Pretax Deferrals or any elective deferrals and qualified nonelective
contributions under this Plan or any other plan maintained by the Company. The
term "ADP Testing Compensation" shall have the same meaning as set forth in
section 4.6. For the purpose of this section 4.7, the terms "elective deferrals"
and "qualified nonelective contributions" shall have the same meaning as in Code
section 401(m)(4).
4.8 Multiple Use Limitation. If, as a result of the testing
described in sections 4.6 and 4.7, each of the four conditions described in
Treasury Regulation section 1.401(m) - 2(b)(1) exist in spite of any reductions
which may be made pursuant to subsections 4.9(b) and 4.9(c), then the
Administrative Committee shall reduce the Pretax Deferrals elected by the
Participants who are Highly Compensated Employees in the manner described in
subsections 4.9(a) or 4.9(b). The reduction shall be made as necessary to
prevent any one of the four conditions described above
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<PAGE>
from occurring. For the purpose of this section 4.8, the term "Highly
Compensated Employee" shall have the meaning set forth in section 4.6.
4.9 Reductions to Pretax Deferrals and After-Tax Contributions.
(a) If it becomes necessary for the Administrative Committee to
reduce the Pretax Deferral of a Participant during the current
Plan Year as a result of (i) the operation of the last paragraph
of section 4.5, (ii) the Plan's expected failure to comply with
the actual deferral percentage test pursuant to section 4.6, or
(iii) the Plan's expected failure to comply with the multiple use
limitation of section 4.8, then the difference between the
percentage elected by the Participant and the percentage as
reduced shall, absent a contrary instruction from the Participant
on his Pretax Deferral election form, be contributed by the
Participant as an Adjustment Contribution through regular payroll
deductions.
In the case of a Participant who is making a contribution under
this subsection, any election to increase, decrease, or
discontinue Pretax Deferrals under section 4.3 shall increase or
decrease contributions under this subsection first before
changing Pretax Deferrals.
(b) To the extent necessary to conform to the limitations contained
in sections 4.6 and 4.8 after the close of the Plan Year, the
Administrative Committee shall reduce Pretax Deferrals made on
behalf of Highly Compensated Employees. Such reduction shall be
effected by reducing Pretax Deferrals made on behalf of Highly
Compensated Employees sequentially and in descending order,
beginning with:
(1) For Plan Years beginning before January 1, 1997, the Highly
Compensated Employee who elected the highest percentage of
such contributions; and
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<PAGE>
(2) For Plan Years beginning after December 31, 1996, the Highly
Compensated Employee who elected the largest dollar amount
of such contributions;
and continuing as needed to conform to such limitations.
Any such reduction in the Pretax Deferrals made on behalf of any
Participant shall be refunded to the Participant as soon as
administratively possible, together with any earnings allocable
to such excess contributions for the Plan Year for which the
excess contributions were made and for the period between the end
of that Plan Year and the date of distribution, as provided in
the rules adopted by the Administrative Committee at the time. In
no event, however, shall such excess contributions or such
earnings allocable thereto be left undistributed any later than
the last day of the Plan Year following the Plan Year in which
such excess contributions were made.
(c) To the extent necessary to conform to the limitations contained
in section 4.7 after the close of the Plan Year, the
Administrative Committee shall reduce the After-Tax Contributions
or Employer matching contributions made on behalf of Highly
Compensated Employees. Such reduction shall be effected by
reducing After Tax Contributions or Employer matching
contributions made on behalf of Highly Compensated Employees
sequentially and in descending order, beginning with:
(1) For Plan Years beginning before January 1, 1997, the Highly
Compensated Employee who elected the highest percentage of
such contributions; and
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<PAGE>
(2) For Plan Years beginning after December 31, 1996, the Highly
Compensated Employee who elected the largest dollar amount
of such contributions;
and continuing as needed to conform to such limitations.
Any such reduction in After-Tax Contributions, Adjustment
Contributions or vested Employer matching contributions made on
behalf of any Participant shall be refunded to the Participant as
soon as administratively possible, together with any earnings
allocable to such excess aggregate contributions for the Plan
Year for which the excess aggregate contributions were made and
for the period between the end of that Plan Year and the date of
distribution, as provided in the rules adopted by the
Administrative Committee at the time. In no event, however, shall
such excess aggregate contributions or such earnings allocable
thereto be left undistributed any later than the last day of the
Plan Year following the Plan Year in which such excess
contributions were made.
If there is a loss allocable to the excess aggregate contribution, the excess
aggregate contributions to be distributed to a Participant shall in no event be
less than the lesser of the Participant's Account under the Plan or the
Participant's After-Tax Contributions, Adjustment Contributions and Employer
matching contributions for the Plan Year. Excess aggregate contributions shall
be distributed from the Participant's Employee Account and Matching Account in
proportion to the Participant's After-Tax Contributions, Adjustment
Contributions and Employer matching contributions for the Plan Year.
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For the purpose of this section 4.9, the term "Highly Compensated Employee"
shall have the meaning set forth in section 4.6.
4.10 Deposit of Pretax Deferrals, After-Tax Contributions and
Adjustment Contributions. The amount to be contributed to the Plan because of
Participants' elections under section 4.1 shall be paid out of the Employer's
funds and shall be deposited in the Trust Fund as soon as practicable after the
payment date for each payroll period. Adjustment Contributions shall be
deposited in the Trust Fund at the same time as contributions under section 4.1.
4.11 Crediting of Pretax Deferrals, After-Tax Contributions and
Adjustment Contributions. The amounts contributed to the Trust Fund under
section 4.1 and section 4.9 on behalf of a Participant shall be credited to the
Pretax Deferral Account and Employee Account, if applicable, of each such
Participant as of the last day of the month for which the contribution is made.
4.12 Distribution of Excess Deferrals. Notwithstanding any other
provision of the Plan, excess deferral amounts and income allocable thereto
shall be distributed no later than April 15 to Participants who claim such
allocable excess deferral amounts for the preceding calendar year. For purposes
of this section 4.12, "excess deferral amount" shall mean the amount of Pretax
Deferrals for a calendar year that the Participant allocates to this Plan
pursuant to the claim procedure set forth below.
The Participant's claim shall be in writing, shall be submitted to the
Administrative Committee no later than March 1, shall specify the Participant's
excess deferral amount for the preceding calendar year, and shall be accompanied
by the Participant's written statement that if such amounts are not distributed,
such excess deferral amount, when added to amounts deferred under other plans or
arrangements described in sections 401(k), 408(k), or 403(b) of the Code,
exceeds the limit imposed on the Participant by section 402(g) of the Code for
the year in which the deferral occurred.
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<PAGE>
The excess deferral amount distributed to a Participant with respect to a
calendar year shall be adjusted for income and, if there is a loss allocable to
the excess deferral, shall in no event be less than the lesser of the
Participant's Account or the Participant's Pretax Deferrals for the Plan Year.
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<PAGE>
Article 5. Employer Matching Contributions
------------------------------------------
5.1 Employer Matching Contributions. Each Participant for whom a
Pretax Deferral, an After-Tax Contribution or an Adjustment Contribution was
made during a month shall be entitled to an additional allocation equal to 75
percent of the contributions under section 4.1 and section 4.9 allocable to him
for the month, provided that the additional allocation cannot be based on more
than 6 percent of Compensation.
Allocations to be made for any Participant for any Plan Year under this section
5.1 shall be limited to the extent necessary to prevent Annual Additions of the
Participant from exceeding the limits of section 5.5.
The Employer shall contribute an amount which, when added to forfeitures, is
sufficient to provide the required allocations.
5.2 Deposit of Employer Matching Contributions. To the extent not
provided from forfeitures in accordance with section 5.4, Employer matching
contributions shall be paid out of funds in the manner specified in section
4.10. Such contributions shall be deposited and posted to the Trust Fund as soon
as practicable after the end of the payroll period for which they are made.
5.3 Crediting of Employer Matching Contributions. The allocations
required under section 5.1 shall be credited to the Matching Account of any
Participant who is entitled to such an allocation as of the date on which the
matched Pretax Deferrals, After-Tax Contributions and Adjustment Contributions
are credited.
5.4 Forfeitures. The Administrative Committee shall use forfeitures
occurring in any month to reduce Employer matching contributions for such month
and future months. Forfeitures shall be used to reduce matching contributions of
all Employers without regard to whether the forfeitures are attributable to
persons employed by any individual Employer. If the
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<PAGE>
amount of forfeitures occurring in a month exceeds the amount of matching
allocations to be made for such month, then the excess shall be held in a
suspense account and allocated in lieu of Employer matching contributions in
succeeding months. No Employer matching contributions shall be made until any
balance in the suspense account is exhausted, and if the Plan terminates while
such a balance exists, the balance shall be allocated in proportion to the
Compensation of all Participants for the Plan Year to the extent of the maximum
amount permitted under section 5.5.
5.5 Limitation on Annual Additions. Notwithstanding anything to the
contrary contained in this Plan, the total Annual Additions under this Plan and
any other defined contribution plan, as defined in section 414(i) of the Code,
maintained by the Employer or any other Affiliate, to a Participant's Account
for any Plan Year, which shall be the limitation year for purposes of section
415 of the Code, shall not exceed the lesser of:
(a) $30,000, or such higher amount as may be permitted by the
Secretary of the Treasury pursuant to Code section 415(d), or
(b) 25 percent of the Participant's Taxable Compensation for the
limitation year.
5.6 "Annual Addition" Defined. For purposes of section 5.5, the term
"Annual Addition", with respect to any Participant for a Plan Year shall mean
the aggregate of:
(a) the amount of Employer contributions (including Pretax Deferrals)
and forfeitures allocated to the Participant's account under this
Plan and any other defined contribution plan, as defined in
section 414(i) of the Code, maintained by the Employer or any
other Affiliate for the Plan Year;
(b) the amount of a Participant's After-Tax Contributions made during
such Plan Year; and
(c) For the purpose of subsection (a) of section 5.5 only, the amount
of Employer contributions, if any, allocated to an account
described in Code section 419A(d)(1) or an account described in
Code section 415(l)(2).
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<PAGE>
5.7 Other Defined Contribution Plans. If the Company or any
nonparticipating Affiliate maintains any other qualified defined contribution
plan for its Employees, some or all of whom are Participants of this Plan, then
any such Participant's Annual Additions (after reductions required under the
provisions of such other plan or plans) shall first be reduced under such other
plan and then shall be reduced under this Plan, if such reduction is required
for purposes of reducing allocations on a combined basis, to the limits of
section 5.5.
5.8 Defined Benefit Plans.
(a) If a Participant in this Plan was also a Participant in a defined
benefit plan, as defined in section 414(j) of the Code, to which
contributions were made by the Employer or any other Affiliate,
then in addition to the limitations contained in section 5.5 of
this Plan, the allocations of the Participant under this Plan
shall be limited to the extent necessary to comply with the
limitation set forth in section 415(e) of the Code. For this
purpose, the Defined Benefit Fraction shall be computed and the
Defined Contribution Fraction shall be adjusted (as provided in
section 5.7) so that the sum of these fractions shall not exceed
1.0.
(b) For purposes of this section 5.8, the following definitions shall
apply:
(i) "Defined Benefit Fraction" shall mean a fraction, the
numerator of which is the aggregate of the projected annual
benefits (determined as of the last day of the Plan Year) of
the Participant under all defined benefit plans (whether or
not terminated) maintained by the Employer or any other
Affiliate, and the denominator of which is the lesser of (x)
the product of 1.25 multiplied by the dollar limitation in
effect under section 415(b)(1)(A) of the Code for such year,
or (y) the product of 1.4 multiplied by the amount which may
be taken into account under section 415(b)(1)(B) of the Code
with respect to the Participant under all such defined
benefit plans for such year.
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<PAGE>
(ii) "Defined Contribution Fraction" shall mean a fraction, the
numerator of which is the sum of the Annual Additions to the
Participant's Account under this Plan and any other defined
contribution plan as defined in section 414(i) of the Code
maintained by the Employer or any other Affiliate for such
Plan Year, and all prior Plan Years, and the denominator of
which is the sum, for such Plan Year and each prior year of
Service with the Employer or any other Affiliate, of the
lesser of (x) the product of 1.25 multiplied by the dollar
limitation in effect under section 415(c)(1)(A) of the Code
for such year (determined without regard to section
415(c)(6) of the Code), or (y) the product of 1.4 multiplied
by the amount which may be taken into account under section
415(c)(1)(B) of the Code with respect to the Participant
under all such defined contribution plans for such year.
5.9 Deductibility Limitation. The dollar amount of Company
contributions, as provided under sections 4.1 and 5.1, shall be limited to the
amount deductible under section 404 of the Code for the taxable year for which
such contributions are paid.
5.10 Adjustment of Allocations. Allocations to the Accounts of a
Participant in excess of the limit of section 5.5 cannot occur because of
limitations on allocations set forth in sections 4.5, 5.1 and 5.4. However, if
an allocation to the Account of a Participant would exceed the limit of section
5.5 due to a reasonable mistake in estimating a Participant's Compensation, then
any amount which cannot be allocated shall be held in a suspense account and
shall be allocated to the account of such Participant in the next following Plan
Year, to the maximum extent permitted under section 5.5.
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<PAGE>
Article 6. Vesting and Benefits
-------------------------------
6.1 Vesting. The right of a Participant to his Pretax Deferral
Account, his Employee Account, and his Rollover Account shall be fully vested at
all times. The right of a Participant to his Matching Account shall fully vest
in him or his Beneficiary:
(a) upon any of the following events, while actively employed by the
Company or an Affiliate:
(i) his attainment of age 65;
(ii) his death;
(iii) his Disability; or
(iv) termination of the Plan, or
(b) if the obligation to make contributions under this Plan is
terminated, or if any event occurs which constitutes a partial
termination of the Plan with respect to the Participant.
The provisions of this section 6.1 notwithstanding, each Participant shall vest
in his Matching Account in increments based on his completed years of Service
pursuant to the following table:
Years of Service Percentage Vested
---------------- -----------------
Less than 1 0
1 20
2 40
3 60
4 80
5 or more 100
Being vested does not mean that a Participant is entitled to immediate receipt
of his benefit. Benefits under the Plan shall be paid only in accordance with
this Article 6.
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<PAGE>
Notwithstanding the foregoing provisions of this section 6.1, the following
special vesting provisions shall apply.
Each Participant who is an "Employee" as that term is defined in that certain
agreement dated March 20, 1987 between Occidental Electrochemicals Corporation
and Ecolab, Inc. shall be fully vested in his Matching Account effective as of
March 25, 1987.
Each Participant who is an "Employee" as that term is defined in that certain
agreement dated December 9, 1986 between Oxy-Diamond Holding Corporation and
Henkel Corporation shall be fully vested in his Matching Account effective as of
April 3, 1987.
Each Participant who is a "Salaried Employee" as defined in section 12.01(b) of
that certain agreement dated January 8, 1988 between Occidental Chemical
Corporation and Franklin-Burlington Plastics, Inc. shall be fully vested in his
Matching Account effective as of January 8, 1988.
Each Participant who becomes an employee of Armand Hammer Museum of Art and
Cultural Center Inc. immediately upon his Separation from Service shall
thereupon become fully vested in his Matching Account.
Each Participant who was an Employee of Kentucky-Ohio Transportation Co. and who
Separated from Service as a result of the November 9, 1990 sale of the
Wheelersburg, Ohio terminal shall be fully vested in his Matching Account
effective as of that date.
Each Participant who was a "Transferred Employee" as defined in the Agreement of
Purchase and Sale between Occidental Chemical Corporation and American Mirrex
Corporation dated
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<PAGE>
February 28, 1992 shall be fully vested in his Personal Savings Account
effective as of March 25, 1992.
Each Participant who is described in section 10(j) of the Asset Purchase
Agreement Dated as of March 3, 1993 Among American Ref-Fuel Company of Niagara,
L.P., as Purchaser, and Occidental Chemical Corporation and Hooker Energy
Corporation, as Sellers, shall be fully vested in his Personal Savings Account
effective as of May 5, 1993.
Each Participant who is an "Included Salaried Employee" as defined in section
3.4(c) of the Stock Purchase Agreement by and between Glenn Springs Holdings,
Inc. and CONSOL Inc. and CONSOL Energy Inc. dated April 14, 1993 shall be fully
vested in his Personal Savings Account effective as of the Closing thereof.
Each Participant who is a "Transferred Employee" as defined in Section 9.1(c) of
the Asset Transfer Agreement between Occidental Chemical Corporation as Seller
and Borden Chemicals and Plastics Operating Limited Partnership as Buyer Dated
as of August 12, 1994 shall be fully vested in his Personal Savings Account as
of the Closing Date thereof.
Each Participant who is a "Salaried Employee" as defined in Section 9.1(b) of
the Asset Transfer Agreement between Occidental Chemical Corporation as Seller
and Ozite Corporation as Purchaser Dated as of September 29, 1994 shall be fully
vested in his Personal Savings Account as of the Closing Date thereof.
Each Participant who is an "Offered Employee" as defined in Section 8.1(a) of
the Asset Purchase Agreement between Occidental Chemical Corporation and
Lyondell Petrochemical Company dated April 13, 1995 shall be fully vested in his
Personal Savings Account as of the Closing Date thereof.
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<PAGE>
Each Participant who is a "Salaried Employee" as defined in Section 6.7(a) of
the Stock Purchase Agreement dated as of September 11, 1995 between Phosphate
Holding Company, Inc. "Purchaser" and Occidental Chemical Corporation "Seller"
shall be fully vested in his Personal Savings Account as of the Closing Date
thereof.
Each Participant who is a "Transferred Salaried Employee" or a "Union Employee",
as those terms are defined in Section 5.24 of the Asset Purchase Agreement By
and Between OCC Tacoma, Inc. as Seller and Pioneer Companies, Inc. as Purchaser
dated as of May 14, 1997, shall be fully vested in his Personal Savings Account
as of the Closing Date thereof.
Each Participant who is a "Covered Employee" as that term is defined in
paragraph I(f) of the Employee Transfer Agreement by and among Occidental
Chemical Corporation, CXY Chemicals, U.S.A., and CXY Chemicals U.S.A. Inc. dated
December 16, 1997, shall be fully vested in his Personal Savings Account as of
the Covered Employee's CXY Employment Date, as determined under such agreement.
Each Participant who is a "Partnership Employee" as defined in Section 2.8(a) of
the Agreement and Plan of Merger and Asset Contribution among Occidental
Petrochem Partner 1, Inc., Occidental Petrochem Partner 2, Inc., Oxy
Petrochemicals Inc., PDG Chemical Inc. and Equistar Chemicals, LP Dated May 15,
1998, shall be fully vested in his Personal Savings Account as of June 1, 1998.
Each Participant who is eligible to participate in the Occidental Petroleum
Corporation Notice and Severance Pay Plan (the "Severance Plan") shall be fully
vested in his Personal Savings Account as of the time of cessation of his
receipt of benefits under the Severance Plan. Such full
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<PAGE>
vesting will occur irrespective of whether such Participant ever receives a
benefit under the Severance Plan.
Each Participant shall have a fully vested and nonforfeitable interest in the
Rollover Account established on his behalf pursuant to section 9.10 as a result
of the merger with the MidCon Corp. ESOP.
6.2 Benefits Upon Separation from Service. Every Participant who
Separates from Service for any reason other than death shall have the vested
portion of his Personal Savings Account, valued as provided in Article 9,
distributed to him as soon as practicable after receipt by the Administrative
Committee of a request for distribution filed by the Participant. Prior to 1997,
a request for distribution may be filed only after the earlier of (i) the
Participant's Separation from Service, or, (ii) January 1 of the calendar year
in which he attains age 70 1/2. After 1996, a request for distribution may be
filed only after the Participant's Separation from Service. If a Participant
attains age 70 1/2 before 1996, or if a Participant is a 5% owner, distribution
shall be made or commenced by the Administrative Committee by December 31 of the
calendar year of such attainment irrespective of whether the Participant has
filed a request and irrespective of whether he Separates from Service, provided
that this limitation shall not apply to Participants who attained age 70 1/2
before January 1, 1988. If a Participant who is not a 5% owner attains age 70
1/2 after 1995, distribution shall be made or commenced by the Administrative
Committee by December 31 of the calendar year that the Participant Separates
from Service.
Notwithstanding anything contained above in this section 6.2, if a Participant
who is not a 5% owner attains age 70 1/2 after December 31, 1987 and prior to
January 1, 1999, such Participant shall be entitled to elect to receive a
distribution of his Personal Savings Account, or to receive commencement of such
a distribution, at any time on or after December 31 of the year in which he
attains age 70 1/2, irrespective of whether he has incurred a Separation from
Service.
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<PAGE>
Every Participant, spousal Beneficiary, or Alternate Payee who receives a
distribution which is an eligible rollover distribution (as defined in Code
section 402(c)(4)) shall be entitled to direct the Administrative Committee to
transfer all or part of the taxable portion of his distribution to any eligible
retirement plan (as defined in Code section 402(c)(8)(B)) which provides for the
receipt of such direct transfers. The Administrative Committee shall, within a
reasonable period of time before making an eligible rollover distribution,
provide to the recipient a copy of the written explanation required by Code
section 402(f).
6.3 Forfeiture of Contingent Interests. Any portion of a
Participant's Personal Savings Account that is not vested in him under the
provisions of section 6.1 upon his Separation from Service shall be forfeited.
If the Participant is rehired, then the cash value (determined at the time of
forfeiture) of the amount forfeited may be restored to his Personal Savings
Account by making a special allocation out of forfeitures. The restoration of
any amounts forfeited is based on the following provisions:
(a) Any Participant who Separated from Service less than fully
vested on or after January 1, 1982 will have his forfeitures
restored upon rehire. Upon restoration, a separate account will
be established, which will be credited by the amount of the
forfeiture. The Participant's vested portion in this restoration
account, at the time of the restoration and at any relevant time
thereafter, shall be the greater of
(i) the Participant's vested percentage in his Matching Account,
as determined under section 6.1, multiplied by the balance
in this restoration account, or
(ii) the Participant's vested percentage in his Matching Account,
as determined under section 6.1, multiplied by the excess of
the sum of the balance in this restoration account and the
amount of the distribution over the amount of the
distribution.
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(b) Any Participant who Separated from Service less than fully vested
on or after January 1, 1981 will have his forfeitures restored,
if he is rehired on or before December 31, 1982.
(c) Any Participant who Separated from Service less than fully vested
prior to January 1, 1981 and was not rehired prior to January 1,
1984 will not be entitled to a restoration of forfeitures.
Notwithstanding the foregoing, any individual who was a participant in the
MidCon Corp. ESOP and who, prior to December 18, 1997, incurred a Separation
from Service shall, upon becoming an Employee, have the unvested portion of his
account under the MidCon Corp. ESOP, determined as of the Valuation Date
coinciding with or immediately preceding the date of such Separation from
Service, restored to a Rollover Account under the Plan. The Employer shall
restore any such amounts by making a special allocation out of forfeitures
available for reallocation in the Plan Year of the restoration, provided that if
such forfeitures are insufficient for such restoration, the Employer shall make
a special contribution in cash for purposes of such restoration. Any amount
restored to a Rollover Account under this section shall be fully vested and
nonforfeitable.
6.4 Death Benefits. Should a Participant die while he is still
employed by the Company or an Affiliate, or after a Separation from Service but
prior to distribution of his Personal Savings Account, the balance of said
deceased Participant's Personal Savings Account, valued as provided in Article
9, shall be distributed to his Beneficiary as soon as practicable after the
Participant's death. Distribution of the deceased Participant's Personal Savings
Account shall be in the form of an immediate annuity for the life of the
Beneficiary with monthly payments as provided in subsection 6.5(c), in an
immediate lump sum payment, or in an immediate 10-year term certain and
continuous annuity with monthly payments as provided in subsection 6.5(e), as
the Beneficiary may elect prior to the receipt of a benefit on a form filed with
the Administrative Committee, provided that if the Participant has designated
more than one Beneficiary,
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distribution shall be made in the form of a lump sum, with payment to be made to
all Beneficiaries concurrently as soon as possible after death. Additionally, a
Beneficiary who is the Participant's spouse may elect, prior to receipt of a
benefit, on a form filed in accordance with procedures established by the
Administrative Committee, to defer receipt of payment of the deceased
Participant's Personal Savings Account, but not beyond December 31 of the year
which includes the date the Participant would have attained age 70 1/2, or to
take a partial cash distribution as provided in subsection 6.5(b). In the
absence of an election otherwise, the benefit shall be paid to the Beneficiary
in an immediate lump sum. Notwithstanding the above, in the case of a
Beneficiary which is a trust or an estate, distribution shall be made in an
immediate lump sum payment.
Should an Alternate Payee or the Beneficiary of a deceased Participant or
Alternate Payee die prior to distribution of a separate Account established on
his behalf, the balance of said deceased individual's Account, valued as
provided in Article 9, shall be distributed to his Beneficiary as soon as
practicable after his death. Such distribution shall be made in the form of a
lump sum.
In the case of a Beneficiary of a Participant for whom a direct plan-to-plan
transfer was made to this Plan from the Laurel Industries Inc. Incentive Savings
Plan (the "Laurel Plan"), distribution may be made, at the election of the
Beneficiary, in any form described in section 6.6(g)(1)(ii) of the Laurel Plan
as in effect on December 31, 1996, provided that the amount subject to such
election shall not exceed the amount of the Beneficiary's Account attributable
to such transfer.
6.5 Forms of Payment. Every Participant who Separates from Service
for any reason other than death or an event described in Code section
401(k)(10)(A) shall have the vested portion of his Personal Savings Account
distributed to him under one of the following distribution options selected by
the Participant on a form prescribed by the Administrative Committee:
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(a) One lump sum payment; or
(b) A partial cash distribution in a specified dollar amount,
provided that a Participant may request a partial cash
distribution only after five months have elapsed since the last
such request by the Participant has been processed; or
(c) An immediate straight life annuity providing monthly payments for
the life of the Participant. No monthly payments will be made
after the Participant's death; or
(d) An immediate joint and survivor annuity providing monthly
payments for the Participant's lifetime. Upon the Participant's
death, 50, 75, or 100 percent of the monthly payment, whichever
is elected by the Participant, will continue for the lifetime of
the Beneficiary if the Beneficiary survives the Participant; or
(e) An immediate 10-year term certain annuity which provides monthly
payments for the life of the Participant with a guarantee that a
minimum of 120 such payments will be made even if the Participant
dies before receiving all of them. The Participant's Beneficiary
will receive the remaining payments; or
(f) Deferral of receipt of payment of the vested portion of his
Personal Savings Account, but not beyond December 31 of the
calendar year of the Participant's attainment of age 70 1/2,
provided that a Participant who elects a deferral of payment
under this subsection (f) may not request a partial cash
distribution under subsection (b) subsequent to his attainment of
age 70 1/2.
A Participant who Separates from Service as a result of an event described in
Code section 401(k)(10)(A), and who would not otherwise be considered to have
Separated from Service, shall have the vested portion of his Personal Savings
Account distributed to him in one lump sum payment.
The Company does not guarantee the benefits described in subsections (c), (d),
and (e) above. In the event of the failure of the issuer of an annuity to comply
with its obligations under an annuity
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contract purchased by the Plan, the Participant's, Beneficiary's, or Alternate
Payee's remedy will be limited to his claim against the issuer.
The failure of a Participant to make a selection as described above upon his
Separation from Service will be deemed to be an election by the Participant to
defer the commencement of his benefits.
A Participant who elects to receive a partial cash distribution pursuant to
subsection (b) may not make a subsequent request for a lump sum payment pursuant
to subsection (a) or an immediate annuity pursuant to subsection (c), (d), or
(e) for a period of one month beginning with the date of the processing of his
partial cash distribution.
If distribution is to be made in the form of an immediate annuity, then the
balance of the Participant's Personal Savings Account shall be used to purchase
an immediate non-transferable commercial annuity contract which shall be
distributed to the Participant.
The automatic distribution option to a Participant shall be a lump sum payment.
In the case of a Participant who elects to receive a benefit pursuant to
subsection (d) or subsection (e) above, the present value of the payments to be
made to the Participant must be more than 50 percent of the present value of the
total payments to be made to the Participant and his Beneficiary.
An election form shall be provided to the Participant in non-technical language
and shall contain (i) a general description of the distribution options and the
relative financial effect of each option, and (ii) notification that such
Participant may subsequently request to receive an additional written
explanation in non-technical language, of the terms, conditions and projected
financial
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impact of one or more of the distribution options (in terms of dollars per
projected monthly annuity payment).
Any election by a married Participant to receive his benefits in the form of an
annuity other than an immediate 50 percent, 75 percent or 100 percent joint and
survivor annuity with his spouse as joint annuitant must be accompanied by a
signed, notarized written consent from the spouse on a form prescribed by the
Administrative Committee, which consent shall state that potential effect to
such spouse of consenting to such an election. Such consent must designate a
Beneficiary (or form of benefits) which may not be changed without spousal
consent, provided that the consent of the spouse may expressly permit
designations by the Participant without any requirement for further consent by
the spouse. Any election of a form of distribution under this section must be
filed in accordance with procedures established by the Administrative Committee
during an election period of not more than 90 days and, except as provided
below, not less than 30 days ending on the day prior to the date as of which his
benefits are scheduled to commence; provided, however, that if the Participant
makes a timely request to receive additional information, as described above,
the election period shall not end prior to 30 days following the furnishing of
such information. A Participant may revoke an election of any benefit form
described in this section and choose again to take any form of benefit available
to him hereunder at any time and any number of times within the above election
period. Notwithstanding the previous two sentences, a Participant, after having
received the written description described in this section, may reject the
automatic election described in this section and elect a different option, in
the manner described above, even though the written description was provided
less than 30 days prior to his benefit commencement date, so long as the
conditions contained in Treasury Regulation section 1.417(e)-1T(b)(3)(ii) have
been met. If the Participant makes an untimely request for additional
information, the Administrative Committee, at its discretion, may grant such
request, but the granting of such request shall not result in the extension of
the election period.
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In the case of an Alternate Payee who becomes entitled to receive his Account
pursuant to an appropriate domestic relations order, where the order so permits,
or where the order is silent as to the form of payment to be made, his Account
shall be distributed to him in the form of a lump sum payment pursuant to option
(a) above, or in the form of a lump sum payment pursuant to option (f) above, as
the Alternate Payee may select on a form to be prescribed by the Administrative
Committee. In the absence of such a selection by an Alternate Payee, his Account
will be distributed to him in the form of a lump sum payment pursuant to option
(a) above. Where an order so permits, an Alternate Payee's Account may be
distributed to him in the form of an immediate straight life annuity providing
monthly payments for the life of the Alternate Payee, a partial cash
distribution as described under option (b) above, an immediate 50 percent, 75
percent or 100 percent joint and survivor annuity, or an immediate 10-year term
certain annuity which provides monthly payments for the life of the Alternate
Payee with a guarantee that a minimum of 120 such payments will be made even if
the Alternate Payee dies before receiving all of them; in that event the
Alternate Payee's Beneficiary will receive the remaining payments.
In the case of a Participant, Beneficiary or Alternate Payee receiving a
distribution in the form of one lump sum payment, pursuant to option (a) above,
or as a lump sum payment under option (f) above, the value of his vested
interest attributable to investments other than Stock shall be paid in cash when
distributed, and the vested interest that is attributable to Account balances
consisting of Stock shall be distributed in full shares of Stock plus cash
representing the value of any fractional share. However, by written notice to
the Administrative Committee, the Participant, Beneficiary or Alternate Payee
may elect to receive cash in such amount as may be provided by the value (as
determined under Article 9) of the Stock that would otherwise be distributed to
him. Such a Participant may elect to receive of all or a portion of his Account
in the form of whole shares of Stock, plus cash for any fractional share,
provided that any such election shall be
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implemented in accordance with administrative procedures established by the
Administrative Committee by transferring the investment of such Account or
portion thereof, as applicable, (including without limitation amounts
transferred from the MidCon Corp. ESOP) as soon as practicable to the OPC Stock
Fund and distributing such amounts as soon as practicable thereafter.
In the case of a Participant for whom a direct plan-to-plan transfer was made to
this Plan from the Laurel Industries Inc. Incentive Savings Plan (the "Laurel
Plan"), distribution may be made, at the election of the Participant, in any
form described in section 6.5(b)(2) of the Laurel Plan as in effect on December
31, 1996, provided that the amount subject to such election shall not exceed the
amount of the Participant's Account attributable to such transfer.
6.6 Time of Payment of Benefits. Distribution of benefits to a
Participant who Separates from Service shall begin not later than the 60th day
after the close of the Plan Year in which occurs the later of (i) the
Participant's Separation from Service, or (ii) the Participant's 65th birthday,
unless the Participant chooses a later payment under section 6.2. If for any
reason the amount which is required to be paid cannot be ascertained on the date
payment would be due hereunder, payment or payments shall be made not later than
60 days after the earliest date on which the amount of such payment is
ascertained.
In the case of an Alternate Payee who is entitled to receive benefits under this
Plan, distribution of benefits may be made at any time that the governing order
may permit, irrespective of the Participant's age and irrespective of whether
the Participant has Separated from Service, so long as either the amount to be
distributed to the Alternate Payee does not exceed $5,000 or the Alternate Payee
consents in writing to the distribution.
6.7 Withdrawals. Any Participant or Inactive Participant who is actively
employed by the Company or an Affiliate may withdraw any amount or shares, up to
100 percent of the sum of (i) such Participant's Employee Account, (ii) his
Matching Account if the Participant is
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fully vested in such Account, and (iii) his Rollover Account, if any, to the
extent permissible, provided that no withdrawal request may be made during the
five-month period beginning with the date the Participant's or Inactive
Participant's most recent withdrawal request was processed. Any Participant or
Inactive Participant who has attained age 59 1/2 may also withdraw any amount or
shares in his Pretax Deferral Account under this section. A Participant or an
Inactive Participant shall be prohibited from requesting a withdrawal in any
semimonthly processing period in which a loan distribution is being processed.
Application for a withdrawal shall be made on such forms as the Administrative
Committee prescribes and shall be effective as of the end of the semimonthly
processing period in which such application is received by the Administrative
Committee. The Administrative Committee shall direct the Trustee, in such cases,
to pay the Participant or Inactive Participant the amount so requested in a
single sum.
Every Participant who receives a withdrawal which is an eligible rollover
distribution (as defined in Code section 402(c)(4)) shall be entitled to direct
the Administrative Committee to transfer all or part of the taxable portion of
his withdrawal to any eligible retirement plan (as defined in Code section
402(c)(8)(B)) which provides for the receipt of such direct transfers. The
Administrative Committee shall, within a reasonable period of time before making
an eligible rollover distribution, provide to the recipient a copy of the
written explanation required by Code section 402(f).
A withdrawal from a Participant's Account balances invested in Stock shall be in
the form of full shares of Stock and cash representing any fractional share,
except that cash shall be paid in lieu of full shares of Stock if the
Participant specified in his written request for withdrawal that the withdrawal
be in the form of cash. A withdrawal from account balances invested in assets
other
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than Stock shall be paid in cash. A withdrawal consisting of pre-1987
contributions from the Employee Account only shall be in the form of cash.
Withdrawals shall be paid first out of the net cumulative pre-1987 contributions
from the Employee Account. Withdrawals shall then be paid out of the net
cumulative post-1986 contributions, together with earnings thereon, on a prorata
basis, from the Employee Account. Additional amounts shall be withdrawn, if
needed, from earnings on pre-1987 contributions from the Employee Account, then
from the Rollover Account, if any, to the extent permissible, then from the
Pretax Deferral Account if permissible, and then from the Matching Account. If a
Participant withdraws any amount from the Matching Account on or after April 1,
1988, the Participant (other than a Participant who has attained age 59 1/2 at
the time the withdrawal is requested, and who withdraws the entire balance in
his Personal Savings Account) shall not be permitted to make any Pretax
Deferrals, After-Tax Contributions or Adjustment Contributions, or receive
Company Matching Contributions for a period of six calendar months after the
withdrawal is processed. The preceding sentence shall be inapplicable in the
case of a withdrawal effected by a creditor of a Participant pursuant to any
insolvency proceeding initiated under federal or state law or pursuant to any
tax levy.
6.8 Debiting of Investment Funds. If a Participant making less than
a total withdrawal of his Accounts under section 6.7, or receiving a
distribution of excess deferral amounts under section 4.12, has his Accounts
invested in more than one Investment Fund, the amount withdrawn from his
Accounts shall be withdrawn from such Investment Fund or combination of
Investment Funds in which the Employee has invested on a prorata basis.
If a Participant receives a partial cash distribution under section 6.5(b), the
amount distributed from his Accounts shall be withdrawn from his Investment
Funds on a pro-rata basis within each such Account as follows: first, his
Employee Account, then his Rollover Account, then his Pretax Deferral Account,
and then his Matching Account.
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6.9 Small Amounts. If the vested balance of a Participant's Personal
Savings Account is $5,000 or less when he or his Beneficiary becomes entitled to
a benefit under sections 6.4 or 6.5, then distribution shall be made in the form
of a lump sum payment, partial cash distribution, or a deferral as described in
sections 6.5(a), 6.5(b), and 6.5(f), respectively.
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Article 7. Participant Loans
----------------------------
7.1 Eligibility. An Employee who is an Eligible Employee or an
Inactive Participant may borrow from the Plan in accordance with the terms and
conditions of this Article 7.
An Employee may have only one loan outstanding at any time. An Employee shall be
prohibited from applying for a loan in any semimonthly processing period in
which an in-service withdrawal is being processed. The preceding sentence shall
be inapplicable in the case of a withdrawal effected by a creditor of a
Participant pursuant to any insolvency proceeding initiated under federal or
state law or pursuant to any tax levy.
7.2 Loan Amount. An eligible Employee shall be able to borrow an
amount of at least $1,000, in increments of $100, as long as the amount of the
loan does not exceed the lesser of
(a) fifty percent (50%) of the Employee's vested Personal Savings Account
value, or
(b) fifty thousand dollars ($50,000), reduced by the highest outstanding
balance of loans to the Employee during the one year period ending on the
day before the date on which such loan was made.
If the Employee is also covered under another qualified plan maintained by the
Company or an Affiliate, the limitation of clause (b), above, shall be applied
as though all such qualified plans with loan provisions are one plan.
The initial amount of the loan shall be limited so that repayments of principal
and interest will not exceed twenty-five percent (25%) of base compensation.
7.3 Loan Terms. The period of repayment for any loan shall be
arrived at by mutual agreement between the Administrative Committee and the
Employee; provided, however, that
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the period of repayment must be in full-year increments and shall not extend
beyond the earlier of five years (ten years in the case of a loan meeting the
requirements of Code section 72(p)(2)(B)(ii)) or the Employee's Separation from
Service.
All loans shall bear an interest rate which shall be stated by the
Administrative Committee and shall be based on the rate being charged by Western
Federal Credit Union for loans secured by the borrower's deposit account during
the calendar month prior to the calendar month in which the loan is made. Such
interest rate shall remain in effect for the entire loan term.
All loans shall include repayment provisions requiring equal periodic payments
no less than quarterly over the term of the loan.
7.4 Source of Loan Funds and Valuation. The funds needed to provide
the principal amount of the loan shall come from liquidation of Investment
Funds. The amounts held in the Employee's Pretax Deferral Account, Rollover
Account, and then Employee Account shall be liquidated from such Investment Fund
or combination of Investment Funds in which the Employee has invested on a
prorata basis.
If all the funds in the Employee's Pretax Deferral Account, Rollover Account,
and Employee Account have been exhausted, and if additional funds are needed to
provide the principal amount of the loan, the Matching Account shall be
liquidated to provide additional loan funds.
Account balances liquidated from the OPC Stock Fund will be valued on the last
business day of the semimonthly processing period in which the loan is
processed. If the volume of loan requests pertaining to the OPC Stock Fund in a
given processing period necessitates selling shares on the open market, then the
loan proceeds liquidated from the OPC Stock Fund will be valued based on the
average price of all shares liquidated in the period the loan is processed.
Account
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balances liquidated from all other funds will be valued at the closing value for
the semimonthly processing period in which the loan is processed.
7.5 Loan Account. The Administrative Committee shall establish a
loan account for the Employee, and shall credit the account with an amount equal
to the principal amount of the loan granted. Each repayment of the principal on
the loan received by the Trustee from the Employee shall reduce the balance
credited to the loan account.
7.6 Repayments. Repayments of the loan principal and interest will
be made through regular payroll deductions. The Employee will be required to
complete a payroll deduction authorization form for the amount of the
repayments, which shall be irrevocable throughout the term of the loan.
Employees who are paid monthly, bi-weekly/semi-monthly, and weekly will have
twelve, twenty-four and forty-eight periodic payroll deductions, respectively,
for each year of the term of the loan.
Irrespective of whether an Employee is currently contributing to the Plan,
periodic loan repayments shall first be credited to the Employee's Matching
Account, until all amounts which were liquidated for the loan principal amount
from that Account, if any, have been repaid. If an Employee is currently
contributing to the Plan, repayments shall then be credited to the Employee
Account loan balance, if any, then the Rollover Account loan balance, if any,
and then the Pretax Deferral Account loan balance, if any, in the same
proportions within each such Account as the Employee's current contributions are
being invested in the Investment Funds, until all amounts which were liquidated
for the loan principal amount from those Accounts have been repaid. If an
Employee is not currently contributing to the Plan, repayments shall then be
credited to the Employee Account loan balance, if any, then the Rollover Account
loan balance, if any, and then the Pretax Deferral Account loan balance, if any,
in the same proportions within each such Account as the latest investment
election on file for the Employee, until all amounts which were liquidated for
the loan principal amount from those Accounts have been repaid. If no investment
election is on file, all repayments to the Employee Account loan balance, if
any,
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Rollover Account loan balance, if any, and Pretax Deferral Account loan balance,
if any, will be made to the Fixed Income Fund, until all amounts which were
liquidated for the loan principal amount from those Accounts have been repaid.
Any accrued interest on the loan balances in the various Accounts will be
credited to the Account to which the related principal repayment is credited.
If an Employee's total compensation will not equal the amount of the required
loan repayment for a period not to exceed three months, loan repayment payroll
deductions shall be suspended. When the Employee's total compensation once again
equals or exceeds the required loan repayment, payroll deductions shall be
reactivated in the first payroll period coincident with or next following the
increase of total compensation. When the repayments are reactivated, if the
number of payroll periods remaining are not sufficient to cover the outstanding
loan balance at the end of the maximum loan term, the loan payment shall be
reamortized or otherwise adjusted.
The Employee may make a prepayment of the entire outstanding principal loan
balance at any time after the end of the month in which the loan application is
processed, provided that this limitation shall be inapplicable to an Employee
who has Separated from Service. Any prepayments shall be credited first to the
Matching Account until all amounts which were liquidated for the loan principal
amount, if any, from that Account have been repaid. Any remaining prepayments
shall then be credited to the remaining Employee Account loan balance, if any,
then the remaining Rollover Account loan balance, if any, and then the remaining
Pretax Deferral Account loan balance, if any, in the same proportions within
each such Account as the Employee's current contributions are being invested in
the Funds, until all amounts which were liquidated for the loan principal amount
from those Accounts have been repaid. If the Employee is not currently
contributing to the Plan, all prepayments will then be credited to the Employee
Account loan balance, if any, then the Rollover Account loan balance, if any,
and then the remaining Pretax Deferral Account loan balance, if any, in the same
proportions within each such
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Account as the latest investment election on file for the Employee, until all
amounts which were liquidated for the loan principal amount from those Accounts
have been repaid. If no investment election is on file, all prepayments will
then be credited to the outstanding loan balances of the Employee Account, if
any, then the Rollover Account, if any, and then the remaining Pretax Deferral
Account, if any, and in each such Account to the Fixed Income Fund. Any accrued
interest on the loan balances in the various Accounts will be credited to the
Account to which the related principal payment is credited. Notwithstanding the
loan prepayment provisions described above, an Employee whose outstanding loan
balance is considered delinquent as described in section 7.9 shall be prohibited
from making a prepayment of his outstanding principal loan balance.
7.7 Leave of Absence. An Employee who is on an approved, unpaid
leave of absence for a period not to exceed three months, shall have his
repayment payroll deduction suspended for the duration of the leave. When the
Employee returns to pay status, the payroll deductions will be reactivated, as
described in the third paragraph of section 7.6, and payments retroactive to the
date of commencement of the leave of absence will be required.
An Employee who is on an approved, unpaid leave of absence for a period greater
than three months, but not to exceed twelve months shall have his loan
reamortized (for a period not exceeding five years from the original loan date)
when he returns to pay status. The payroll deductions shall be increased upon
the reamortization, and the Employee shall be required to complete a new payroll
deduction authorization form for the new amount.
When an Employee incurs a Separation from Service pursuant to section 2.1(dd),
any outstanding loan balance is treated pursuant to the terms of section 7.8.
7.8 Separation from Service. When an Employee incurs a Separation
from Service, the outstanding loan balance shall be due and payable as of the
last day of the month in which the Separation from Service occurs. If the loan
has not exceeded the maximum loan term, the
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Employee or the Employee's Beneficiary will have a period of two months from the
last day of the month in which the Separation from Service occurred, in which to
repay the outstanding loan balance in full. If the Employee or the Employee's
Beneficiary does not pay the outstanding loan balance in full within the
two-month period, or the maximum loan term has been exceeded, any outstanding
loan balance shall be treated as a distribution.
7.9 Delinquent Payments. A loan shall be considered delinquent if
(a) the Employee, not covered pursuant to the third paragraph of
section 7.6, sections 7.7 or 7.8, fails to make a regularly
scheduled repayment,
(b) the Employee's total compensation is insufficient to make the
authorized loan repayment payroll deduction for a period
exceeding three months, while he is in active pay status,
(c) the authorized loan repayment payroll deductions are reduced or
suspended for any reason, or
(d) the Employee is declared bankrupt, and unable to make subsequent
repayments.
When an Employee's loan is considered delinquent, the outstanding principal loan
balance shall be processed as a deemed distribution, within the meaning of
proposed Treasury Regulation section 1.72(p)-1, following written notification
to the Employee. The deemed distribution shall be immediately taxable to the
Employee except to the extent that the deemed distribution represents a
nontaxable return of After-Tax Contributions from his Employee Account.
The taxable portion of the deemed distribution shall remain outstanding under
the Employee's Savings Account until the Employee incurs a Separation from
Service or, if earlier, the Employee becomes Disabled or dies. This amount shall
be treated as a nontaxable distribution when the Employee's Savings Account is
otherwise distributed.
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The principal loan balance that was processed as a deemed distribution may not
subsequently be repaid to the Plan.
7.10 Discontinuance. The foregoing sections of this Article 7
notwithstanding, the Administrative Committee reserves the right to stop
granting loans to Employees at any time.
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Article 8. Investment Elections
-------------------------------
8.1 Investment of Contributions. All Pretax Deferrals, After-Tax
Contributions, Adjustment Contributions, rollovers, and loan repayments (both
principal and interest) made by and on behalf of a Participant each Plan Year
and amounts merged into the Plan pursuant to section 9.10 shall be invested as
the Participant shall designate in any of the various Investment Funds in
increments of 5 percent of the aggregate amount of such contributions, provided,
however, that contribution elections made in 25% increments which were in effect
on May 31, 1990 shall remain in effect until revoked by the Participant, and
provided further that elections in effect on May 31, 1990 by Participants to
have contributions invested in the Active Bond Fund (as that Investment Fund was
then defined) shall, effective as of June 1, 1990, be considered to be elections
to have contributions invested in the Fixed Income Fund. All Matching
Contributions allocated to the Account of a Participant shall be invested in the
OPC Stock Fund. Each Participant may make the designation described above by
making an election in accordance with procedures established by the
Administrative Committee upon becoming a Participant, and may change such
election at any time thereafter by making another election in accordance with
procedures established by the Administrative Committee. In the event that a
Participant fails to designate the Investment Fund in which his Pretax
Deferrals, After-Tax Contributions, Adjustment Contributions, rollover
contributions, or amounts merged into the Plan pursuant to section 9.10 are to
be invested, such amounts shall be invested in the Fixed Income Fund. Any such
election made upon initial enrollment or upon a resumption or change in the
amount of Pretax Deferrals, After-Tax Contributions and Adjustment Contributions
shall take effect as of the first day of the month of receipt thereof by the
Administrative Committee. Elections hereunder may be made only once in any
semimonthly processing period.
8.2 Transfers of Existing Balances. Participants, Inactive
Participants and Alternate Payees may elect to transfer, in accordance with
procedures established by the Administrative Committee, amounts allocated to
their accounts as described herein.
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Each Participant, Inactive Participant, and Alternate Payee may elect not more
often than once in any semimonthly processing period to transfer amounts
allocated to his Pretax Deferral Account, Employee Account, and Rollover Account
from any of the various Investment Funds to the Pretax Deferral Account,
Employee Account, or Rollover Account within one or more of the same Funds, in
increments of 5 percent of the amount being transferred.
Each election made pursuant to this section 8.2 shall be effective as of the
last business day of the semimonthly processing period in which notice thereof
is received by the Administrative Committee.
Any transfer made pursuant to this section 8.2 does not affect the investment of
future employee contributions, which will be invested according to the last
election filed pursuant to section 8.1.
Nothing contained in this section 8.2 shall be construed as preventing a
Participant or Inactive Participant from having amounts allocated to his Pretax
Deferral Account, Employee Account, Matching Account, or Rollover Account in any
Investment Fund transferred to one or more other Investment Funds for the
purpose of facilitating an asset transfer to the trustee of a qualified
retirement plan sponsored by a purchaser or the subsidiary of a purchaser as a
result of a transaction involving the sale by the Company or an Affiliate of
either all or substantially all of the outstanding common stock of an Affiliate
or all or substantially all of the assets of a production facility, under
circumstances where the Participant or Inactive Participant is employed by the
Affiliate or at the production facility that is the subject of the sale.
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8.3 Transfer of Assets. In the case of transfers of existing Account
balances under section 8.2, the Administrative Committee shall direct the
Trustee to transfer moneys or other property as soon as is practical after the
end of each semimonthly processing period from the appropriate Investment Fund
to the other Investment Fund in order to carry out the aggregate transfer
transactions after the Administrative Committee has caused the necessary entries
to be made in the Participants' Accounts in the Investment Funds and has
reconciled offsetting transfer elections, in accordance with uniform rules
therefor established by the Administrative Committee.
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Article 9. Participant Accounts and Records of the Plan
-------------------------------------------------------
9.1 Accounts and Records. The Participant's Pretax Deferral Account,
Matching Account, Employee Account, and Rollover Account shall be assigned a
subaccount for each Investment Fund in which the Account is invested. Each such
subaccount shall be maintained and valued separately from all other subaccounts.
The Administrative Committee shall maintain records relative to a Participant's
Accounts so that there may be determined as of any Accounting Date the current
value of his Accounts in the Trust Fund.
Each Participant shall be advised from time to time, at least once each Plan
Year, as to the value of his Personal Savings Account and the portions thereof
attributable to his Employee Account, Matching Account, Pretax Deferral Account,
and Rollover Account.
9.2 Account Value. As of any given date for which determination of
the value of a Participant's Account is required, such value shall equal the sum
of the value of his Pretax Deferral Account, Employee Account, Matching Account,
and Rollover Account as of the preceding Accounting Date plus any additional
contributions withheld or paid and less the amount of any withdrawals from such
Account after the Accounting Date and prior to the date of determination.
Each Participant shall be advised from time to time, at least once each Plan
Year, as to the value of his Account and the portions thereof attributable to
his various Investment Funds.
9.3 Investment Funds. The Trust Fund shall consist of the Investment
Funds, and each Participant who has any interest in an Investment Fund shall
have an undivided proportionate interest. The Administrative Committee shall
have the right to determine the number of Investment Funds to be maintained by
the Plan, and to increase or decrease that number from time to time as it deems
appropriate. The Investment Committee shall establish additional Investment
Funds or eliminate existing Investment Funds as directed by the
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Administrative Committee. In so doing, the Investment Committee shall implement
and carry out investment objectives and policies which it shall establish and
maintain.
9.4 Valuation Adjustments. As of each Accounting Date, the
Administrative Committee, after crediting Participants' Accounts with
contributions made during the period ending on that date as provided herein,
shall adjust the net credit balances in the Accounts of Participants or their
Beneficiaries, in the respective Investment Funds of the Trust Fund, upward or
downward, in proportion to the Account balance of each such Participant in the
Investment Fund as of the first day of the period, so that the sum of such net
credit balances will equal the net value of each Investment Fund of the Trust
Fund as of that Accounting Date. The Administrative Committee shall determine
the net value of an Investment Fund, by subtracting from the fair market value
of assets (as reported by the Trustee) held in such Investment Fund any
expenses, withdrawals, distributions and transfers chargeable to that Investment
Fund which have been incurred but not yet paid. All determinations made by the
Trustee with respect to fair market values and determinations of the
Administrative Committee concerning net value shall be made in accordance with
generally accepted principles of trust accounting, and such determinations when
so made by the Trustee and the Administrative Committee shall be conclusive and
binding upon all persons having an interest under the Plan.
9.5 Accounting Change. Effective as of January 1, 1987, the unit
values of each Investment Fund, calculated as of December 31, 1986, shall be
eliminated, and subaccounts of each Participant in each Investment Fund shall be
maintained in dollar amounts thereafter. The beginning dollar balance of each
Participant's Account in each Investment Fund shall equal the dollar value of
the units held by each Account in the Investment Fund as of December 31, 1986.
Thereafter, allocations to accounts and subaccounts of a Participant shall be
made in dollars in accordance with the Participant's investment elections.
9.6 Loan Accounts. The value of a Participant's Loan Account shall
at all times equal the amount of principal outstanding on his loan.
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9.7 OPC Stock Fund Valuation. The balance of each Participant's
Matching Account, and any portion of the Participant's Pretax Deferral Account,
Employee Account or Rollover Account invested in the OPC Stock Fund shall be
maintained in full and fractional shares of Stock.
All Stock acquired by the OPC Stock Fund, including, but not by way of
limitation, Stock contributed directly by the Employer or purchased with the
contribution made pursuant to Articles 4 and 5, Stock purchased with cash
dividends paid in respect of Stock, Stock acquired from stock dividends and
stock splits, and Stock purchased with the proceeds of the sale or exchange of
warrants, rights or dividends in kind distributed in respect of Stock, shall be
allocated to the Accounts of Participants based on Participants' Account
balances as of the beginning of the semimonthly processing period in which the
Stock is acquired.
For the purpose of valuing a Participant's Account in connection with any
withdrawal, loan or transfer under the provisions of the Plan or for the purpose
of any distribution in kind or partly in kind, shares of Stock shall be valued
as of the effective date of the withdrawal, loan, transfer or distribution based
on the closing quotation on the New York Stock Exchange on the last trading day
of the semimonthly processing period in which such withdrawal, loan, transfer or
distribution is made; provided, however, that if shares of Stock are sold in
connection with such a withdrawal, loan, transfer or distribution, the shares
sold shall be valued at the net proceeds received therefor. If the closing price
of such Stock shall not be so quoted or if so quoted shall not be available to
the Administrative Committee, a composite index price or other price which shall
be generally accepted for the establishment of fair market value shall be used
for the purpose of so valuing the Participant's Account.
9.8 Cost Account. The Trustee shall maintain records so that the
cost or "basis" (for tax purposes) of the Stock allocated to his Account may be
determined as of any Accounting Date. Whenever shares of Stock are allocated to
the Account of a Participant, such shares shall
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be assigned a cost equal to the average cost of all shares allocated at the same
time in accordance with rules and procedures adopted for the purpose by the
Administrative Committee.
9.9 Rollovers. Subject to the Administrative Committee's approval,
amounts which a Participant has received or is entitled to receive from any
other employee benefit plan may, in accordance with uniform and
nondiscriminatory procedures adopted by the Administrative Committee, be
transferred by the Participant to this Plan or, alternatively, by the trustee of
the other employee benefit plan directly to this Plan, and if transferred, shall
be credited to such Participant's Rollover Account hereunder, provided the
following conditions are satisfied:
(a) The rollover amounts tendered to the Administrative Committee
must have been received by or on behalf of the Participant from:
(1) A plan qualified under section 401(a) of the Code; or
(2) A conduit individual retirement account, described in
section 408(d)(3)(A)(ii) of the Code, to which no individual
retirement account contributions were made or rolled over
from a qualified plan.
(b) In the case of a distribution described in (a)(1), above, the
amounts tendered must not include:
(1) Amounts contributed to a qualified plan on an after-tax
basis by a Participant, or
(2) Any other amounts not eligible for rollover treatment.
(c) Amounts must be received by the Administrative Committee not
later than 60 days after the distribution was received by the
Participant.
The Administrative Committee shall establish such procedures, and may require
such additional information from the Participant as it deems necessary or
appropriate to determine that a proposed transfer hereunder will satisfy the
above requirements. Rollover amounts shall be transmitted to the Trustee to be
invested in such Investment Funds as the Eligible Employee may
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select, in accordance with such rules as are provided in Article 8, or in
accordance with other procedures approved by the Administrative Committee.
9.10 Merger of the MidCon Corp. ESOP. Effective May 15, 1998, the
MidCon Corp. ESOP shall be merged with and into the Plan and the entire interest
of each individual who was a participant in the MidCon Corp. ESOP as of May 15,
1998, shall be transferred to this Plan and held in a Rollover Account
established on behalf of each such individual. Such amounts shall be invested in
accordance with section 8.1. For the period prior to May 15, 1998, the terms of
the MidCon Corp. ESOP, as established November 20, 1996, shall apply.
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Article 10. Financing
---------------------
10.1 Financing. The Company shall maintain a Trust to finance the
benefits under the Plan, by entering into one or more Trust Agreements or
insurance contracts approved by the Company, or by causing insurance contracts
to be held under a Trust Agreement. Any Trust Agreement is designated as and
shall constitute a part of this Plan, and all rights which may accrue to any
person under this Plan shall be subject to all the terms and provisions of such
Trust Agreement. A Trustee shall be appointed by the Board of Directors and
shall have such powers as provided in the Trust Agreement. The Company may
modify any Trust Agreement or insurance contract from time to time to accomplish
the purpose of the Plan and may replace any insurance company or appoint a
successor Trustee or Trustees. By entering into such Trust Agreements or
insurance contracts, the Company shall vest in the Trustee, or in one or more
investment managers (as defined under ERISA) appointed under the terms of the
Trust Agreement from time to time by action of the Investment Committee,
responsibility for the management and control of the Trust Fund. In the event
the Investment Committee appoints any such investment manager, the Trustee shall
not be liable for the acts or omissions of the investment manager or have any
responsibility to invest or otherwise manage any portion of the Trust Fund
subject to the management and control of the investment manager. The Investment
Committee from time to time shall establish a funding policy which is consistent
with the objectives of the Plan and shall communicate it to the Trustee and each
investment manager so that they may coordinate investment policies with such
funding policy.
10.2 Employer Contributions. The Employer shall make such
contributions to the Trust Fund as are required by this Plan, subject to the
right of the Company to discontinue the Plan.
10.3 OPC Stock Fund. The OPC Stock Fund shall consist of shares of
Stock and cash or cash equivalents that are held pending investment in Stock.
Investment in such shares shall be made from time to time by a direct issue of
Stock from the Company, or by purchase from
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securities dealers or by private purchase at such prices and in such amounts as
the Trustee may determine in its absolute and uncontrolled discretion. However,
no private purchase of such shares shall be made at a total cost greater than
the total cost (including brokers' fees and other expenses of purchase) of
purchasing such shares at the then prevailing price of such shares on the open
market, such prevailing price to be determined by the Trustee as nearly as
practicable based on the most recent public trading prices for the Stock. The
Trustee may match purchases and sales to satisfy investment elections,
withdrawals, loans and distributions of Participants.
Cash dividends and cash proceeds from any other distribution received on Stock
shall be invested in Stock. The Trustee in its own discretion may invest funds
awaiting investment in Stock in short-term obligations, including obligations of
the United States of America or any agency or instrumentality thereof, trust and
participation certificates, beneficial interests in any trust, and such other
short-term obligations as the Trustee deems to be appropriate for such interim
investment purposes.
The Trustee in its discretion may limit the daily volume of its purchases or
sales of Stock to safeguard interest of Participants or comply with legal or
exchange requirements. If the Trustee limits daily volume then the purchase
prices or sale proceeds, as the case may be, during the period of volume
limitations, shall be averaged, and the average per share price or sale proceeds
shall be used in determining the cost or proceeds to be applied in satisfaction
of any order of a Participant which requires the Trustee to purchase or sell
Stock during such period.
Investment elections of Company officers shall be limited, if necessary, so that
the beneficial interest in the Stock held by the Trust for their Accounts shall
not exceed, in the aggregate, 20 percent of the total value of all securities
and other assets held by the Trust, in all Investment Funds. For purposes of
this section 10.3, the term "officers" shall have the same meaning as set
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forth in Regulation section 240.3-b-2 promulgated pursuant to section 3(b) of
the Securities Exchange Act of 1934.
All Stock purchased by the Trustee shall be registered in the name of the
Trustee or its nominee, and legal title to such Stock shall remain in the
Trustee until the Participant shall become entitled to distribution thereof
pursuant to this Plan.
In the event any option, right or warrant is received by the Trustee on Stock,
the Trustee shall sell the same at public or private sale and at such price and
upon such other terms as it may determine, unless the Investment Committee shall
determine that such option, right or warrant should be exercised, in which case
the Trustee shall exercise the same upon such terms and conditions as the
Investment Committee may prescribe.
The Trustee shall have the power to vote all shares of Stock held under this
Plan and may vote such shares itself or by proxy, except that the Trustee shall
vote shares of Stock credited to accounts of Participants and Alternate Payees
for which it has received directions from Participants and Alternate Payees in
accordance with such direction. The Trustee shall vote any Stock for which it
does not receive instructions from Participants or Alternate Payees in
accordance with directions from the Administrative Committee.
10.4 Non-Reversion. Anything in this Plan to the contrary
notwithstanding, it shall be impossible at any time for the contributions of the
Employer or any part of the Trust Fund to revert to the Company or an Affiliate
or to be used for or diverted to any purpose other than the exclusive benefit of
Participants or their Beneficiaries, except that:
(a) If a contribution or portion thereof is made by the Employer by a
mistake of fact, upon written request to the Administrative
Committee, such contribution or such portion and any increment
thereon shall be returned to the Employer within one year after
the date of payment; and
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(b) In the event that a deduction for any contributions made by the
Employer is disallowed by the Internal Revenue Service in any
Plan Year, then that portion of the Employer contribution that is
not deductible shall be returned to the Employer within one year
from the date of receipt of notice by the Internal Revenue
Service of the disallowance of the deduction.
10.5 Direct Transfer of Assets from Plans of Acquired Entities. The
Trust Agreement shall permit the direct receipt of assets which are transferred
directly to the Trust Fund from the trustees of qualified retirement plans
sponsored, at the time of the applicable transaction, by entities which are the
subject of purchase transactions made by the Company or an Affiliate.
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Article 11. Administration
--------------------------
11.1 The Administrative Committee. The Plan shall be administered by
an Administrative Committee appointed by the Board of Directors. The
Administrative Committee shall be composed of as many members as the Board may
appoint from time to time, but not fewer than three members, and shall hold
office at the discretion of the Board. Such members may, but need not, be
Employees of the Company.
Any member of the Administrative Committee may resign by delivering his written
resignation to the Board and to the Administrative Committee Secretary. Such
resignation shall be effective no earlier than the date of the written notice.
Vacancies in the Administrative Committee arising by resignation, death,
removal, or otherwise, shall be filled by the Board. The Administrative
Committee shall be a fiduciary under the Plan, in accordance with ERISA.
11.2 Chairman, Secretary, and Employment of Specialists. The members
of each of the Investment Committee and Administrative Committee shall elect one
of their number as Chairman and shall elect a Secretary who may, but need not,
be a member of such Committee. They may authorize one or more of their number or
any agent to execute or deliver any instrument or instruments on their behalf,
and may employ such counsel, auditors, and other specialists and such clerical,
medical, actuarial, and other services as they may require in carrying out the
provisions of the Plan.
11.3 Compensation and Expenses. The members of the Investment
Committee and Administrative Committee who are Employees shall serve without
compensation for services as a member of such Committee. Any member of a
Committee may receive reimbursement by the Company of expenses properly and
actually incurred. All expenses of a Committee shall be paid by the Company.
Such expenses may include any expenses incident to the functioning of a
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Committee, including, but not limited to, fees of the Plan's accountants,
outside counsel and other specialists and other costs of administering the Plan.
11.4 Manner of Action. A majority of the members of the Investment
Committee and Administrative Committee at the time in office shall constitute a
quorum for the transaction of business. All resolutions adopted, and other
actions taken by a Committee at any meeting shall be by the vote of a majority
of those present at any such meeting. Upon obtaining the written consent of a
majority of the members at the time in office, action of a Committee may be
taken otherwise than at a meeting.
11.5 Subcommittees. Each of the Investment Committee and
Administrative Committee may appoint one or more subcommittees and delegate such
of its power and duties as it deems desirable to any such subcommittee, in which
case every reference herein made to such Committee shall be deemed to mean or
include the subcommittees as to matters within their jurisdiction. The members
of any such subcommittee shall consist of such officers or other Employees of
the Company and such other persons as such Committee may appoint.
11.6 Other Agents. Each Committee may also appoint one or more
persons or agents to aid it in carrying out its duties as fiduciary, and
delegate such of its powers and duties as it deems desirable to such person or
agents.
11.7 Records. All resolutions, proceedings, acts, and determinations
of each Committee shall be recorded by the Secretary thereof or under his
supervision, and all such records, together with such documents and instruments
as may be necessary for the administration of the Plan, shall be preserved in
the custody of the Secretary.
11.8 Rules. Subject to the limitations contained in the Plan, each
Committee shall be empowered from time to time in its discretion to adopt
by-laws and establish rules for the conduct of its affairs and the exercise of
the duties imposed upon it under the Plan.
11.9 Administrative Committee's Powers and Duties. The Administrative
Committee shall have responsibility for the general administration of the Plan
and for carrying out its
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provisions. The Administrative Committee shall have such powers and duties as
may be necessary to discharge its functions hereunder, including, but not
limited to, the following:
(a) To construe and interpret the Plan, to supply all omissions from,
correct deficiencies in and resolve ambiguities in the langauage
of the Plan and Trust; to decide all questions of eligibility and
determine the amount, manner, and time of payment of any benefits
hereunder;
(b) To make a determination as to the right of any person to an
allocation, and the amount thereof;
(c) To obtain from the Employees such information as shall be
necessary for the proper administration of the Plan and, when
appropriate, to furnish such information promptly to the Trustees
or other persons entitled thereto;
(d) To prepare and distribute, in such manner as the Company
determines to be appropriate, information explaining the Plan;
(e) To establish and maintain such accounts in the name of each
Participant as are necessary;
(f) To instruct the Trustee with respect to the payment of benefits
hereunder;
(g) To provide for any required bonding of fiduciaries and other
persons who may from time to time handle Plan assets;
(h) To prepare and file any reports required by ERISA;
(i) To engage an independent public accountant to conduct such
examinations and to render such opinions as may be required by
ERISA;
(j) To allocate contributions and Trust Fund gains or losses to the
Accounts of Participants;
(k) To correct any errors and remedy any defects in the
administration of this Plan; and
(l) To designate Affiliates as Employers as described in section
12.5.
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Notwithstanding the foregoing, the administrative committee of the MidCon Corp.
ESOP, as appointed as set forth in section 9.10 thereof, shall continue to have
the authority to construe and interpret the MidCon Corp. ESOP and the provisions
of the Plan relating to amounts transferred to the Plan pursuant to section 9.10
hereof, and to supply all omissions from, correct deficiencies in, and resolve
ambiguities in such language and related trusts; to decide all questions
(including without limitation questions of fact) of eligibility and determine
the amount, manner, and time of payment of any benefits under the MidCon Corp.
ESOP; to determine the rights of any person to an allocation and the amount
thereof thereunder; and to continue to administer the Benefits Claims Procedures
under section 9.18 thereof.
11.10 Investment Responsibilities. The Investment Committee shall have
the authority and responsibility to direct the Trustee with respect to the
investment and management of the Trust Fund, and to establish a funding policy
and method consistent with the objectives of the Plan and the requirements of
ERISA. Except as otherwise provided in ERISA, the Investment Committee may
delegate such authority and responsibility to direct the Trustee to any person
who acknowledges in writing that it is a fiduciary with respect to the Plan and
who provides the Investment Committee with a written affirmation that it is
qualified to act as an investment manager within the meaning of ERISA. If the
Investment Committee delegates to an investment manager the authority and
responsibility to so direct the Trustee, such investment manager, and not the
Investment Committee or the Trustee, shall have sole responsibility for the
investment and management of so much of the Trust Fund as has been entrusted to
his management and control, and, except to the extent otherwise required by
ERISA, such delegation shall relieve the Investment Committee and the members
thereof of all duties and responsibilities with respect to the authority and
responsibility so delegated.
The Investment Committee may relinquish to the Trustee the Investment
Committee's power to direct the Trustee with respect to the investment and
management of the Trust Fund. In the event the Investment Committee so
relinquishes said power to the Trustee and the Trustee accepts such
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responsibility in writing, the Trustee shall have sole and exclusive power and
responsibility with respect to the investment and management of the Trust Fund.
The Investment Committee may regain the power so relinquished by appropriate
Investment Committee action and notice to the Trustee.
11.11 Committees' Decisions Conclusive. The Administrative Committee
and the Investment Committee shall exercise their powers hereunder in a uniform
and nondiscriminatory manner. Any and all disputes with respect to the Plan
which may arise involving Participants, or their Beneficiaries shall be referred
to the Administrative Committee and its decision shall be final, conclusive, and
binding. Furthermore, if any question arises as to the meaning, interpretation,
or application of any provision hereof, the decision of the Administrative
Committee with respect thereto shall be final.
11.12 Indemnity. To the extent permitted by the Company's bylaws and
applicable law, the Company shall indemnify each member of the Administrative
Committee and the Investment Committee (which, for purposes of this section,
includes any Employee to whom the Administrative Committee or the Investment
Committee has delegated fiduciary or other duties) against any and all claims,
losses, damages, expenses, including counsel fees, incurred by the member and
any liability, including any amounts paid in settlement with the Company's
approval, arising from the member's or the Company's action or failure to act,
except when the same is judicially determined to be attributable to the gross
negligence or willful misconduct of such member. The right of indemnity
described in the preceding sentence shall be conditioned upon the timely receipt
of notice by the Company of any claim asserted against the member, which notice,
in the event of a lawsuit shall be given within ten days after receipt by the
member of the complaint.
11.13 Fiduciaries. The fiduciaries named in this Article shall have
only those specific powers, duties, responsibilities, and obligations as are
specifically given them under this Plan or the Trust. The Employer shall have
the sole responsibility for making the contributions specified in Articles 4 and
5, and the Company shall have the sole authority to appoint and remove the
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Trustee and to amend or terminate, in whole or in part, this Plan or the Trust.
The Administrative Committee shall have the sole responsibility for the
administration of this Plan, which responsibility is specifically described in
this Plan and the Trust Agreement. The officers and Employees of the Company
shall have the responsibility of implementing the Plan and carrying out its
provisions as the Administrative Committee shall direct. The Investment
Committee, the Trustee, and any investment manager shall have the sole
responsibility for the administration of the Trust and the management of the
assets held under the Trust, to the extent provided in the Trust Agreement. A
fiduciary may rely upon any direction, information, or action of another
fiduciary as being proper under this Plan or the Trust, and is not required
under this Plan or the Trust to inquire into the propriety of any such
direction, information, or action. It is intended under this Plan and the Trust
that each fiduciary shall be responsible for the proper exercise of his or its
own powers, duties, responsibilities, and obligations under this Plan and the
Trust and shall not be responsible for any act or failure to act of another
fiduciary. No fiduciary guarantees the Trust Fund in any manner against
investment loss or depreciation in asset value. Any party may serve in more than
one fiduciary capacity with respect to the Plan or Trust.
11.14 Notice of Address. Each person entitled to benefits from the
Plan must file with the Administrative Committee or its agent, in writing, his
post office address and each change of post office address. Any communication,
statement, or notice addressed to such a person at his latest reported post
office address will be binding upon him for all purposes of the Plan, and
neither the Administrative Committee nor the Company or any Trustee shall be
obliged to search for or ascertain his whereabouts.
11.15 Data. All persons entitled to benefits from the Plan must
furnish to the Company such documents, evidence, or information, including
information concerning marital status, as the Company considers necessary or
desirable for the purpose of administering the Plan; and it shall be a condition
of the Plan that each such person must furnish such information and sign such
documents as the Company may require before any benefits become payable from the
Plan. The Administrative Committee shall be entitled to distribute benefits to a
non-spouse beneficiary
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in reliance upon the signed statement of the Participant that he is unmarried
without any further liability to a spouse if such statement is false.
11.16 Benefit Claims Procedures. All applications for benefits under
the Plan shall be submitted to: Occidental Petroleum Corporation, Attention:
Pension and Retirement Plan Administrative Committee, 10889 Wilshire Blvd., Los
Angeles, CA 90024. Applications for benefits must be in writing on the forms
prescribed by the Administrative Committee and must be signed by the
Participant, or in the case of a death benefit, by the Beneficiary or legal
representative of the deceased Participant. Each application shall be acted upon
and approved or disapproved within 60 days following its receipt by the
Administrative Committee. If any application for a benefit is denied, in whole
or in part, the Administrative Committee shall notify the applicant in writing
of such denial and of his right to a review by the Administrative Committee and
shall set forth in a manner calculated to be understood by the applicant,
specific reasons for such denial, specific references to pertinent Plan
provisions on which the denial is based, a description of any additional
material or information necessary for the applicant to perfect his application,
an explanation of why such material or information is necessary, and an
explanation of the Plan's review procedure.
Any person, or his duly authorized representative, whose application for
benefits is denied in whole or in part, may appeal from such denial to the
Administrative Committee for a review of the decision by submitting to the
Administrative Committee within 60 days after receiving notice of the denial a
written statement:
(a) requesting a review of his application for benefits by the
Administrative Committee;
(b) setting forth all of the ground upon which his request for review
is based and any facts in support thereof; and
(c) setting forth any issues or comments which the applicant deems
relevant to his application.
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The Administrative Committee shall act upon each such application within 60 days
after the later of receipt of the applicant's request for review by the
Administrative Committee or receipt of any additional materials reasonably
requested by the Administrative Committee from such applicant.
The Administrative Committee shall make a full and fair review of each such
application and any written materials submitted by the applicant or the Employer
in connection therewith and may require the Employer or the applicant to submit
within 30 days of written notice by the Administrative Committee therefor, such
additional facts, documents, or other evidence as the Administrative Committee,
in its sole discretion, deems necessary or advisable in making such a review. On
the basis of its review, the Administrative Committee shall make an independent
determination of the applicant's eligibility for benefits under the Plan. The
decision of the Administrative Committee on any application for benefits shall
be final and conclusive upon all persons if supported by substantial evidence in
the record.
If the Administrative Committee denies an application in whole or in part, the
Administrative Committee shall give written notice of its decision to the
applicant setting forth in a manner calculated to be understood by the applicant
the specific reasons for such denial and specific references to the pertinent
Plan provisions on which the Administrative Committee decision was based.
11.17 Member's Own Participation. No member of the Administrative
Committee or the Investment Committee may act, vote or otherwise influence a
decision of the committee on which he serves specifically relating to his own
participation under the Plan.
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Article 12. Amendment and Termination
-------------------------------------
12.1 Amendment and Termination. The Company expects the Plan to be
permanent and to continue indefinitely; however, this Plan is purely voluntary
on the part of the Company, and each Employer, and the Company must necessarily
and does hereby reserve the right to amend, modify, or terminate the Plan at any
time by action of its Board of Directors. The Administrative Committee in its
discretion may amend the Plan if it finds that such amendment does not
significantly increase or decrease benefits or costs. No amendment of the Plan
shall cause any part of the Trust Fund to be used for, or diverted to, purposes
other than for the exclusive benefit of the Participants or their Beneficiaries
covered by the Plan, or increase the duties and responsibilities of the Trustee
without its consent, or decrease the Account balance of a Participant or
Beneficiary.
12.2 Distribution on Termination. Upon termination of the Plan in
whole or in part, or upon complete discontinuance of contributions to the Plan
by the Company, the value of the proportionate interest in the Trust Fund of
each Participant affected by such termination shall be determined by the
Administrative Committee as of the date of such termination or discontinuance.
The Accounts of such Participants shall be fully vested and nonforfeitable, and
thereafter distribution shall be made to such Participants as directed by the
Administrative Committee.
Upon the partial termination of the Plan, the Board of Directors may in its sole
discretion determine the timing of a distribution of the balance of the affected
Participants' Accounts.
12.3 Successors. In case of the merger, consolidation, liquidation,
dissolution or reorganization of an Employer, or the sale by an Employer of all
or substantially all of its assets, provision may be made by written agreement
between the Company and any successor corporation acquiring or receiving a
substantial part of the Employer's assets, whereby the Plan and the Trust will
be continued by the successor. If the Plan is to be continued by the successor,
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then effective as of the date of the reorganization or transfer, the successor
corporation shall be substituted for the Employer under the Plan and the Trust
Agreement. The substitution of a successor corporation for an Employer will not
in any way be considered a termination of the Plan.
12.4 Plan Merger or Transfer. This Plan shall not merge or
consolidate with, or transfer assets and liabilities to, or accept a transfer
from, any other employee benefit plan unless each Participant in this Plan will
(if the Plan had then terminated) receive a benefit immediately after the
merger, consolidation, or transfer which is not less than the benefit the
Participant would have been entitled to receive immediately before the merger,
consolidation, or transfer of assets (if this Plan had then terminated). Subject
to these limitations, the Plan may transfer assets and liabilities to, or accept
a transfer of assets and liabilities from, any other employee benefit plan which
is qualified under Code section 401(a) where such a transfer has been authorized
by agreement between the Employer and the sponsor of the other employee benefit
plan and is not prohibited by law.
12.5 Participating Affiliates. The Board of Directors or the
Administrative Committee may designate any Affiliate as an Employer under this
Plan. The Affiliate shall become an Employer and a party to this Plan and the
Trust upon acceptance of such designation. Any Affiliate may withdraw from the
Plan and Trust, and end its status as an Employer hereunder, by communicating to
the Administrative Committee its desire to withdraw. Upon withdrawal, the Plan
shall be considered terminated as to Employees of such Affiliate.
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Article 13. Top-Heavy Provisions
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13.1 Application of Top-Heavy Provisions. If in any Plan Year after
1983 (i) the sum of the Personal Savings Account balances of Participants who
are "Key Employees" for such Plan Year exceeds 60 percent of the sum of Personal
Savings Account balances of all Employees (and former Employees or Beneficiaries
described in section 13.4), or (ii) the Plan is part of a top-heavy group, then
the following provisions under this Article shall apply for such Plan Year.
The date for determining the applicability of this Article, ("determination
date") is:
(a) For the first Plan Year, the last day of the Plan Year; and
(b) For any other Plan Year, the last day of the preceding Plan Year.
13.2 Key Employees. For purposes of this Article, the term "Key
Employee" means any Employee or former Employee (or his Beneficiary) who at any
time during a Plan Year or any of the four preceding Plan Years is:
(a) An officer of the Company or its Affiliates who receives Taxable
Compensation of more than $60,000 (or, if greater, one half of
the dollar limitation in effect under Code section 415(b)(1)(A))
in the Plan Year; provided no more than the lesser of (i) 50
Employees, or (ii) the greater of three Employees or 10 percent
of all Employees are to be treated as officers;
(b) One of the ten Employees owning the largest interests in excess
of one-half percent of the Company or an Affiliate if such
Employee receives Taxable Compensation during the Plan Year that
exceeds $30,000 (or, if greater, the dollar limitation in effect
under Code section 415(c)(1)(A));
(c) A 5 percent owner of the Company or an Affiliate; or
(d) A 1 percent owner of the Company or an Affiliate who receives
Taxable Compensation of more than $150,000 for the Plan Year.
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An Employee is considered to own more than a 5 percent interest if the Employee
owns at least 5 percent of the Company's outstanding Stock or Stock possessing
at least 5 percent of the total combined voting power of all of the Company and
Affiliates' Stock. An Employee is also treated as owning Stock owned by certain
members of the Employee's family as provided in section 318 of the Code.
The same rules apply to determine whether an Employee is a 1 percent owner.
If an Employee ceases to be a Key Employee, such Employee's Personal Savings
Account balance shall be disregarded under the top-heavy plan computation for
any Plan Year following the last Plan Year for which he was treated as a Key
Employee.
13.3 Top-Heavy Group. For purposes of determining whether the Plan is
part of a top-heavy group as described in section 13.1, the following rules
shall apply:
(a) Aggregation Group. All plans maintained by the Company or an
Affiliate are aggregated to determine whether the plans, as a
group, are top-heavy. The aggregation group shall include any
plan which covers a Key Employee and any other plan which enables
a plan covering a Key Employee to meet the requirements of
section 401(a)(4) or 410 of the Code.
(b) Top-Heavy Group. An aggregation group is a top-heavy group if, as
of the determination date, (1) the sum of the account balances of
Key Employees under all defined contribution plans included in
the group exceeds 60 percent of the account balances of all
participants under all such plans in the group, or (2) the
present value of the accumulated accrued benefits for Key
Employees under all defined benefit plans in the group exceeds 60
percent of the present value of the accumulated accrued benefits
for all participants under all such plans in the group.
In any Plan Year, in testing for top-heaviness under section 13.1, the Company
may in its discretion expand the aggregation group to take into account any
other plan maintained by it or
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an Affiliate, so long as such expanded aggregation group continues to meet the
requirements of sections 401(a)(4) and 410 of the Code.
13.4 Additional Rules. In determining the present value of the
accumulated accrued benefits under a defined benefit plan and the sum of the
account balances under a defined contribution plan, Company contributions and
Employee contributions (other than deductible employee contributions) as of the
determination date for the Plan Year shall be taken into account. The present
value of accrued benefits shall, for purposes of this Article, be calculated by
using factors derived from the UP-84 mortality table, set back one year, and a 5
percent interest rate. The present value of the accrued benefit in a defined
benefit plan or the account balance in a defined contribution plan will include
any amount distributed to a Participant within the five year period ending on
the determination date, but shall not include a rollover initiated by the
Employee and made after December 31, 1983. Accrued benefits or account balances
of Employees who have not performed services for the Employer during the five
Plan Years ending on the determination date shall not be taken into account.
Additionally, for the purpose of determining the present value of the
accumulated accrued benefits under a defined benefit plan and the sum of the
account balances under a defined contribution plan, the rules set forth in Code
sections 416(g)(3) and (4) will be taken into account.
13.5 Combined Limit on Contributions and Benefits for Key Employees.
If the Plan is determined to be top-heavy in any Plan Year under the provisions
of section 13.1 or 13.3, then the combined limit on benefits and contributions
under section 415(e) of the Code for any Key Employee who participates in both a
defined benefit plan and a defined contribution plan which are included in a
top-heavy group as provided in section 13.3 above shall be the lesser of 1.0 (as
applied to the dollar limit) or 1.4 (as applied to the limit based upon
compensation).
13.6 Minimum Contributions. If this Plan is determined to be
top-heavy in any Plan Year under the provisions of section 13.1 or 13.3, then
contributions shall be made under the Retirement Plan on behalf of each non-Key
Employee who is a Participant hereunder in an amount not less than three percent
of the Participant's Taxable Compensation for each year.
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Article 14. Miscellaneous Provisions
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14.1 Employment Rights. Nothing contained in this Plan or any
modification of the same or act done in pursuance hereof shall be construed as
giving any person any legal or equitable right against the Employer, the
Trustee, or the Trust Fund, unless specifically provided herein, or as giving
any person a right to be retained in the employ of the Employer. All
Participants shall remain subject to assignment, reassignment, promotion,
transfer, layoff, reduction, suspension, and discharge to the same extent as if
this Plan had never been established.
14.2 No Examination or Accounting. Neither this Plan nor any action
taken thereunder shall be construed as giving any person the right to an
accounting or to examine the books or affairs of the Company or Employer.
14.3 Investment Risk. The Participants and their Beneficiaries shall
assume all risks in connection with any decrease in the value of any assets or
funds which may be invested or reinvested in the Trust which supports this Plan.
14.4 Non-Alienation. No Benefit payable at any time under the Plan
shall be subject to the debts or liabilities of a Participant or his
Beneficiary. Any attempt to alienate, sell, transfer, assign, pledge, or
otherwise encumber any such benefit, whether presently or thereafter payable,
shall be void. Except as otherwise provided by law, no benefit under the Plan
shall be subject in any manner to attachment, garnishment, or encumbrance of any
kind, provided, however, that judicial orders for purposes of enforcing family
support obligations or pertaining to domestic relations (which orders do not
alter the amount of the benefit) may, at the discretion of the Administrative
Committee, be honored by the Plan. The Administrative Committee shall establish
appropriate procedures for reviewing court orders pertaining to domestic
relations and child support and for notifying Participants of the receipt of
such orders.
14.5 Incompetency. Every person receiving or claiming benefits under
the Plan shall be conclusively presumed to be mentally competent and of age
until the date on which the
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Administrative Committee receives a written notice, in a form and manner
acceptable to the Administrative Committee, that such person is incompetent or a
minor, for whom a guardian or other person legally vested with the care of his
Person or estate has been appointed; provided, however, that if the
Administrative Committee shall find that any person to whom a benefit is payable
under the Plan is unable to care for his affairs because of incompetency, or is
a minor, any payment due (unless a prior claim therefor shall have been made by
a duly appointed legal representative) may be paid to the spouse, a child, a
parent, or a brother or sister, or to any person or institution deemed by the
Administrative Committee to have incurred expense for such person otherwise
entitled to payment. To the extent permitted by law, any such payment so made
shall be a complete discharge of liability therefor under the Plan.
In the event a guardian of the estate of any person receiving or claiming
benefits under the Plan shall be appointed by a court of competent jurisdiction,
benefit payments may be made to such guardian, provided that proper proof of
appointment and continuing qualification is furnished in a form and manner
acceptable to the Administrative Committee. To the extent permitted by law, any
such payment so made shall be a complete discharge of liability therefor under
the Plan.
14.6 Severability. In the event any provision of this Plan shall be
held illegal or invalid for any reason, such illegality or invalidity shall not
affect the remaining parts of this Plan, and it shall be construed and enforced
as if such illegal or invalid provision had never been inserted herein.
14.7 Counterparts. This Plan may be executed in any number of
counterparts, each of which shall be deemed to be an original. All the
counterparts shall constitute but one and the same instrument and may be
sufficiently evidenced by any one counterpart.
14.8 Service of Legal Process. The members of the Administrative
Committee and the Secretary of the Company are hereby designated agent of the
Plan for the purpose of receiving service of summons, subpoena, or other legal
process.
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14.9 Headings of Articles and Sections. The headings of sections and
subsections are included solely for convenience of reference, and if there is
any conflict between such headings and the text of the plan, the text shall
control.
14.10 Applicable Law. The Plan and all rights hereunder shall be
governed, construed, and administered in accordance with the laws of the State
of California with the exception that any Trust Agreement which may constitute a
part of the Plan shall be construed and enforced in all respects under and by
the laws of the State in which the Trustee thereunder is located.
14.11 Unclaimed Benefits. In the event that the Administrative
Committee, after having made a diligent search, is unable to locate a
Participant, Beneficiary, or Alternate Payee who is entitled to benefits under
this Plan, such benefits shall be reallocated to the accounts of other
Participants in accordance with section 9.4. In the event that the Participant,
Beneficiary, or Alternate Payee whose account is subject to such reallocation
subsequently asserts a valid claim for his benefits, his account will be
restored in the manner described in section 6.3(a).
14.12 Qualified Military Service. Notwithstanding any provision of
this Plan to the contrary, contributions, benefits and Service credit with
respect to qualified military service will be provided in accordance with
section 414(u) of the Code.
* * *
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APPENDIX I
PARTICIPATION AND VESTING FOR CERTAIN EMPLOYEES
UNDER GLENN SPRINGS SALE AGREEMENT
Effective as of the Closing thereof, Participants (including Participants who
are receiving short-term disability payments made directly by an Employer, or
pursuant to a plan maintained by an Employer) who are Included Salaried
Employees as defined in section 3.4(c) of the Stock Purchase Agreement by and
between Glenn Springs Holdings, Inc. and CONSOL Inc. and CONSOL Energy Inc.
dated April 14, 1993 (the "Agreement") shall cease to be Participants in the
Plan.
Such Participants shall be fully vested in their Personal Savings Accounts
effective as of the Closing.
Additionally, effective as of the Closing, Inactive Participants who are
employed by a subsidiary of Glenn Springs Holdings, Inc. on the Closing shall be
fully vested in their Personal Savings Accounts.
Effective as of the Closing, Participants who are Excluded Employees as defined
in section 3.4(a) of the Agreement shall be fully vested in their Personal
Savings Accounts.
For the purpose of this Appendix I and section 6.1, the term "Closing" shall
have the meaning set forth in section 9.1 of the Agreement.
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