<PAGE>
<TABLE>
<CAPTION>
<S> <C>
As filed with the Securities and Exchange Commission on May 5, 2000.
REGISTRATION NO. 333-_______________
- ------------------------------------------------------------------------------------------------------------------------
</TABLE>
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM S-8
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
LYONDELL CHEMICAL COMPANY
(Exact name of Registrant as specified in its charter)
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<CAPTION>
<S> <C> <C>
Delaware 1221 McKinney, Suite 700 95-4160558
(State or other jurisdiction) Houston, Texas 77010 (I.R.S. Employer
of incorporation or organization) (Address of principal executive offices) Identification No.)
(Zip Code)
</TABLE>
LYONDELL CHEMICAL COMPANY
1999 LONG-TERM INCENTIVE PLAN
AND
STOCK OPTION PLAN FOR NON-EMPLOYEE DIRECTORS
(Full title of the plans)
Katie-Pat Bowman
Senior Corporate Counsel and
Assistant Secretary
Lyondell Chemical Company
1221 McKinney, Suite 1600
Houston, Texas 77010
(Name and address of agent for service)
(713) 652-7200
(Telephone number, including area code, of agent for service)
<TABLE>
<CAPTION>
CALCULATION OF REGISTRATION FEE
=======================================================================================================================
AMOUNT TO PROPOSED PROPOSED MAXIMUM AMOUNT OF
TITLE OF BE MAXIMUM OFFERING AGGREGATE OFFERING REGISTRATION
SECURITIES TO BE REGISTERED REGISTERED PRICE PER SHARE(1) PRICE (1) FEE
<S> <C> <C> <C> <C>
- ------------------------------------------------------------------------------------------------------------------------
Common Stock, par value $1 per share (2) 10,000,000 $18.41 $184,100,000 $48,603
========================================================================================================================
</TABLE>
(1) Estimated solely for the purpose of calculating the registration fee
pursuant to Rule 457(c) under the Securities Act of 1933. Represents the
average of the high and low sale prices of Lyondell Common Stock on May 4,
2000.
(2) Includes an indeterminable number of shares of Common Stock issuable as a
result of the anti-dilution provisions of each of the foregoing plans and
the associated Common Stock purchase Rights attributable to all such
shares.
<PAGE>
PART II
INFORMATION REQUIRED IN THE REGISTRATION STATEMENT
ITEM 3. INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE
The following documents filed with the Securities and Exchange Commission are
incorporated herein by reference:
(a) The Company's Annual Report on Form 10-K for the year ended
December 31, 1999;
(b) The Company's Current Reports on Form 8-K filed on March 7,
March 14 and April 14, 2000; and
(c) The description of the Company's common stock, $1.00 par value
("Common Stock"), contained in the Registration Statement on Form 8-A dated
December 15, 1988, as such Registration Statement may be amended from time
to time; and
(d) The description of the Rights to Purchase Common Stock contained
in the Registration Statement on Form 8-A dated December 12, 1995, as such
Registration Statement may be amended from time to time.
All documents subsequently filed by the Company pursuant to Sections 13(a),
13(c), 14 and 15(d) of the Exchange Act, prior to the filing of a post-effective
amendment which indicates that all securities offered hereby have been sold or
which deregisters all securities remaining unsold, shall be deemed to be
incorporated by reference herein and to be a part hereof from the date of the
filing of such documents.
ITEM 4. DESCRIPTION OF SECURITIES
Not applicable.
ITEM 5. INTEREST OF NAMED EXPERTS AND COUNSEL
The legality of the Common Stock is offered hereby by Gerald A. O'Brien,
Vice President and Deputy General Counsel for the Company. As of April 30, 2000,
Mr. O'Brien owned 15,443 shares of Common Stock, either directly or through
employee benefit plans of the Company, and held options to acquire 39,385 shares
of Common Stock.
ITEM 6. INDEMNIFICATION OF DIRECTORS AND OFFICERS
The Company's Certificate of Incorporation and By-Laws provide that
the Company will indemnify each of its directors and officers to the full extent
permitted by the laws of the State of Delaware and may indemnify certain other
persons as authorized by the Delaware General Corporation Law (the "DGCL").
Section 145 of the DGCL provides as follows:
"(a) A corporation shall have power to indemnify any person who was
or is a party or is threatened to be made a party to any threatened,
pending or completed action, suit or proceeding, whether civil, criminal,
administrative or investigative (other than an action by or in the right of
the corporation) by reason of the fact that he is or was a director,
officer, employee or agent of the corporation, or is or was serving at the
request of the corporation as a director,
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officer, employee or agent of another corporation, partnership, joint
venture, trust or other enterprise, against expenses (including attorneys'
fees), judgments, fines and amounts paid in settlement actually and
reasonably incurred by him in connection with such action, suit or
proceeding if he acted in good faith and in a manner he reasonably believed
to be in or not opposed to the best interests of the corporation, and, with
respect to any criminal action or proceeding, had no reasonable cause to
believe his conduct was unlawful. The termination of any action, suit or
proceeding by judgment, order, settlement, conviction, or upon a plea of
nolo contendere or its equivalent, shall not, of itself, create a
presumption that the person did not act in good faith and in a manner which
he reasonably believed to be in or not opposed to the best interests of the
corporation, and, with respect to any criminal action or proceeding, had
reasonable cause to believe that his conduct was unlawful.
(b) A corporation shall have power to indemnify any person who was or
is a party or is threatened to be made a party to any threatened, pending
or completed action or suit by or in the right of the corporation to
procure a judgment in its favor by reason of the fact that he is or was a
director, officer, employee or agent of the corporation, or is or was
serving at the request of the corporation as a director, officer, employee
or agent of another corporation, partnership, joint venture, trust or other
enterprise against expenses (including attorneys' fees) actually and
reasonably incurred by him in connection with the defense or settlement of
such action or suit if he acted in good faith and in a manner he reasonably
believed to be in or not opposed to the best interests of the corporation
and except that no indemnification shall be made in respect of any claim,
issue or matter as to which such person shall have been adjudged to be
liable to the corporation unless and only to the extent that the Court of
Chancery or the court in which such action or suit was brought shall
determine upon application that, despite the adjudication of liability but
in view of all the circumstances of the case, such person is fairly and
reasonably entitled to indemnity for such expenses which the Court of
Chancery or such other court shall deem proper.
(c) To the extent that a director, officer, employee or agent of a
corporation has been successful on the merits or otherwise in defense of
any action, suit or proceeding referred to in subsections (a) and (b), or
in defense of any claim, issue or matter therein, he shall be indemnified
against expenses (including attorneys' fees) actually and reasonably
incurred by him in connection therewith.
(d) Any indemnification under subsections (a) and (b) (unless ordered
by a court) shall be made by the corporation only as authorized in the
specific case upon a determination that indemnification of the director,
officer, employee or agent is proper in the circumstances because he has
met the applicable standard of conduct set forth in subsections (a) and
(b). Such determination shall be made (1) by the board of directors by a
majority vote of a quorum consisting of directors who were not parties to
such action, suit or proceeding, or (2) if such a quorum is not obtainable,
or, even if obtainable a quorum of disinterested directors so directs, by
independent legal counsel in a written opinion, or (3) by the stockholders.
(e) Expenses (including attorneys' fees) incurred by an officer or
director in defending any civil, criminal, administrative, or investigative
action, suit or proceeding may be paid by the corporation in advance of the
final disposition of such action, suit or proceeding upon receipt of an
undertaking by or on behalf of such director or officer to repay such
amount if it shall ultimately be determined that he is not entitled to be
indemnified by the corporation as authorized in this Section. Such expenses
(including attorneys' fees) incurred by other employees and agents may be
so paid upon such terms and conditions, if any, as the board of directors
deems appropriate.
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(f) The indemnification and advancement of expenses provided by, or
granted pursuant to, the other subsections of this Section shall not be
deemed exclusive of any other rights to which those seeking indemnification
or advancement of expenses may be entitled under any by-law, agreement,
vote of stockholders or disinterested directors or otherwise, both as to
action in his official capacity and as to action in another capacity while
holding such office.
(g) A corporation shall have power to purchase and maintain insurance
on behalf of any person who is or was a director, officer, employee or
agent of the corporation, or is or was serving at the request of the
corporation as a director, officer, employee or agent of another
corporation, partnership, joint venture, trust or other enterprise against
any liability asserted against him and incurred by him in any such
capacity, or arising out of his status as such, whether or not the
corporation would have the power to indemnify him against such liability
under the provisions of this Section.
(h) For purposes of this Section, references to "the corporation" shall
include, in addition to the resulting corporation, any constituent
corporation (including any constituent of a constituent) absorbed in a
consolidation or merger which, if its separate existence had continued,
would have had power and authority to indemnify its directors, officers,
and employees or agents, so that any person who is or was a director,
officer, employee or agent for such constituent corporation, or is or was
serving at the request of such constituent corporation as a director,
officer, employee or agent of another corporation, partnership, joint
venture, trust or other enterprise, shall stand in the same position under
the provisions of this Section with respect to the resulting or surviving
corporation as he would have with respect to such constituent corporation
if its separate existence had continued.
(i) For purposes of this Section, references to "other enterprises"
shall include employee benefit plans; references to "fines" shall include
any excise taxes assessed on a person with respect to an employee benefit
plan; and references to "serving at the request of the corporation" shall
include any service as a director, officer, employee or agent of the
corporation which imposes duties on, or involves services by, such
director, officer, employee, or agent with respect to an employee benefit
plan, its participants, or beneficiaries; and a person who acted in good
faith and in a manner he reasonably believed to be in the interest of the
participants and beneficiaries of an employee benefit plan shall be deemed
to have acted in a manner "not opposed to the best interests of the
corporation" as referred to in this Section.
(j) The indemnification and advancement of expenses provided by, or
granted pursuant to, this section shall, unless otherwise provided when
authorized or ratified, continue as to a person who has ceased to be a
director, officer, employee or agent and shall inure to the benefit of the
heirs, executors and administrators of such a person."
The By-Laws of the Company provide as follows:
"The Company shall indemnify the officers and directors of the Company
with respect to all matters to which Section 145 of the General Corporation
Law of the State of Delaware may in any way relate, to the fullest extent
permitted or allowed by the laws of the State of Delaware, whether or not
specifically required, permitted or allowed by said Section 145. Any repeal
or modification of this Section shall not in any way diminish any rights to
indemnification of such person or the obligations of the Company that may
have previously arisen hereunder."
Lyondell's Certificate of Incorporation limits the personal liability of
directors to the Company and its stockholders for monetary damages resulting
from certain breaches of the directors' fiduciary
II-3
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duties. The Company maintains directors and officers liability insurance.
The Company has entered into Indemnity Agreements with each of its
officers and directors providing that, subject to certain exclusions, the
Company shall indemnify and hold the indemnitee harmless, to the fullest extent
permitted by the DGCL, against all claims by reason of the fact that he or she
is or was serving as an officer or director of the Company or its subsidiaries
or in some other enumerated corporate status.
ITEM 7. EXEMPTION FROM REGISTRATION CLAIMED
Not applicable.
ITEM 8. EXHIBITS
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<CAPTION>
Exhibit No.
- ------------ Description
-----------
<C> <S>
4.1 Amended and Restated Certificate of Incorporation of the Company (incorporated by
reference to the Company's Annual Report on Form 10-K for the year ended
December 31, 1996)
4.2 Certificate of Ownership and Merger dated July 31, 1998 (incorporated by reference to
the Company's Annual Report on Form 10-K for the year ended December 31, 1999)
4.3 Amended and Restated By-laws of the Company (incorporated by reference to the
Company's Quarterly Report on Form 10-Q for the period ended June 30, 1997)
4.4 Rights Agreement between the Company and The Bank of New York, as Rights Agent
(incorporated by reference to Company's Current Report on Form 8-K dated
December 8, 1995)
4.5 Lyondell Chemical Company 1999 Long-Term Incentive Plan (incorporated by reference to
Company's Annual Report on Form 10-K for the year ended December 31, 1998)
4.6 Form of Stock Option Agreement under the 1999 Long-Term Incentive Plan
4.7 Form of Restricted Stock Grant under the 1999 Long-Term Incentive Plan
4.8 Form of Performance Share Grant under the 1999 Long-Term Incentive Plan
4.9 Lyondell Chemical Company Stock Option Plan for Non-Employee Directors
4.10 Form of 2000 Grant Stock Option Agreement for Non-Employee Directors
5 Opinion and consent of Gerald A. O'Brien, Vice President and Deputy General Counsel
of the Company
23.1 Consent of Gerald A. O'Brien (included as part of Exhibit 5)
23.2 Consent of PricewaterhouseCoopers LLP
23.3 Consent of Deloitte & Touche LLP
24 Powers of Attorney (incorporated by reference to the Company's annual report on Form
10-K for the year ended December 31, 1999)
</TABLE>
II-4
<PAGE>
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 this Registration Statement (or the most recent post-
effective amendment hereof) which, individually or in the aggregate, represent a
fundamental change in the information set forth in this Registration Statement.
Notwithstanding the foregoing, any increase or decrease in volume of securities
offered (if the total dollar volume 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 Securities and Exchange Commission pursuant to Rule 424(b) if, in
the aggregate, the changes in volume and price represent no more than a 20%
change in the maximum aggregate offering price set forth in the "Calculation of
Registration Fee" table in the effective registration statement; and
(iii) To include any material information with respect to the plan of
distribution not previously disclosed in this Registration Statement or any
material change to such information in this Registration Statement;
provided, however, that paragraphs (1)(i) and (1)(ii) do not apply if the
information required to be included in a post-effective amendment by those
paragraphs is contained in periodic reports filed with or furnished to the
Securities and Exchange Commission by the Registrant pursuant to Section 13 or
Section 15(d) of the Securities Exchange Act of 1934 that are incorporated by
reference in this 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 herein, 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 this
Registration Statement shall be deemed to be a new registration statement
relating to the securities offered herein, 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 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
Securities Act of 1933 and is, therefore, unenforceable. In the event that a
claim for indemnification against such
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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 Securities Act of 1933 and will be governed by the
final adjudication of such issue.
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<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the Registrant
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 Houston, State of Texas, on May 4, 2000.
LYONDELL CHEMICAL COMPANY
By: /s/ ROBERT T. BLAKELY
------------------------------
Robert T. Blakely
Executive Vice President and
Chief Financial 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.
<TABLE>
<CAPTION>
SIGNATURE TITLE DATE
--------- ----- ----
<S> <C> <C>
WILLIAM T. BUTLER* Chairman of the Board of Directors May 4, 2000
------------------
(William T. Butler)
CAROL A. ANDERSON* Director May 4, 2000
------------------
(Carol A. Anderson)
TRAVIS ENGEN* Director May 4, 2000
-------------
(Travis Engen)
STEPHEN F. HINCHLIFFE, JR.* Director May 4, 2000
---------------------------
(Stephen F. Hinchliffe, Jr.)
DUDLEY C. MECUM II* Director May 4, 2000
-------------------
(Dudley C. Mecum II)
DAN F. SMITH* President, Chief Executive Officer and May 4, 2000
------------- Director
(Dan F. Smith)
PAUL R. STALEY* Director May 4, 2000
---------------
(Paul R. Staley)
ROBERT T. BLAKELY* Executive Vice President and Chief May 4, 2000
------------------ Financial Officer
(Robert T. Blakely, Principal
Financial Officer)
KELVIN R. COLLARD* Vice President and Controller May 4, 2000
------------------
(Kelvin R. Collard, Principal
Accounting Officer)
*By ROBERT T. BLAKELY May 4, 2000
------------------
(Robert T. Blakely as Attorney-in-fact)
</TABLE>
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Exhibit 4.6
LYONDELL CHEMICAL COMPANY
1999 LONG-TERM INCENTIVE PLAN
FORM OF NONQUALIFIED STOCK OPTION AWARD AGREEMENT
Lyondell Chemical Company (the "Company") hereby grants on
___________, ____ (the "Grant Date") to [PARTICIPANT] (the "Optionee"), an
employee of the Company, a right (the "Option") to purchase from the Company up
to but not exceeding in the aggregate [OPTIONS] shares of Common Stock, par
value $1.00 per share, of the Company ("Common Stock") at $___ per share (the
"Exercise Price"), such number of shares and such price per share being subject
to adjustment as provided in Section 11 of the Lyondell Chemical Company 1999
Long-Term Incentive Plan (the "Plan"), and further subject to the following
terms and conditions:
1. RELATIONSHIP TO PLAN.
This Option is intended to be a nonqualified stock option within the
meaning of Section 83 of the Code. This Option is subject to all of the terms,
conditions and provisions of the Plan and administrative interpretations
thereunder, if any, which have been adopted by the Committee thereunder and are
in effect on the date hereof. Except as defined herein, capitalized terms shall
have the same meanings ascribed to them under the Plan.
2. EXERCISE SCHEDULE.
(a) This Option shall become exercisable in three cumulative
installments, with one-third of the Option Shares becoming exercisable on
February 3, 2001, an additional one-third of the Option Shares becoming
exercisable on February 3, 2002, and the final one-third of the Option
Shares becoming exercisable on February 3, 2003. The Optionee must be in
continuous Employment from the Grant Date through the date of
exercisability of each installment in order for the Option to become
exercisable with respect to additional shares of Common Stock on such date.
For purposes of this Award Agreement, "Employment" means employment with
the Company or its parent or any of its Subsidiaries.
(b) This Option shall become fully exercisable, irrespective of the
limitations set forth in subparagraph (a) above, provided that the Optionee
has been in continuous Employment since the Grant Date, upon termination of
Employment due to death, Disability or Retirement, or upon a Change in
Control.
(c) This Option shall become fully exercisable, irrespective of the
limitations set forth in subparagraph (a) above, provided that the Optionee
has been in continuous Employment since the Grant Date, if, at any time
prior to February 3, 2003 the Fair Market Value per share of Common Stock
is greater than or equal to two times the
1
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Exercise Price for at least 5 consecutive trading days.
(d) For purposes of this Award Agreement, the following definitions
apply:
(i) "Disability" means a permanent and total disability as
defined in the Company's Executive Long-Term Disability Plan.
(ii) "Retirement" means a termination of employment initiated
voluntarily by the Optionee (i) on or after age 65 or (ii) on or after
age 55 with 10 years of participation service as credited under the
Company's qualified defined benefit pension plan.
(iii) "Change in Control" shall be deemed to have
occurred as of the date that one or more of the following occurs:
(a) Individuals who, as of the date hereof, constitute the
entire Board of Directors of the Company ("Incumbent Directors") cease
for any reason to constitute at least a majority of the Board;
provided, however, that any individual becoming a director subsequent
to the date hereof whose election, or nomination for election by the
Company's shareholders, was approved by a vote of at least a majority
of the then Incumbent Directors shall be considered as though such
individual was an Incumbent Director, but excluding, for this purpose
any such individual whose initial assumption of office occurs as a
result of either an actual or threatened election contest, as such
terms are used in Rule 14a-11 under the Securities Exchange Act of
1934, as amended ("Exchange Act") or other actual or threatened
solicitation of proxies or consents by or on behalf of any Person (as
defined below) other than the Board;
(b) The stockholders of the Company shall approve (A) any
merger, consolidation or recapitalization of the Company (or, if the
capital stock of the Company is affected, any subsidiary of the
Company), or any sale, lease, or other transfer (in one transaction or
a series of transactions contemplated or arranged by any party as a
single plan) of all or substantially all of the assets of the Company
(each of the foregoing being an "Acquisition Transaction") where (1)
the shareholders of the Company immediately prior to such Acquisition
Transaction would not immediately after such Acquisition Transaction
beneficially own, directly or indirectly, shares or other ownership
interests representing in the aggregate eighty percent (80%) or more
of (a) the then outstanding common stock or other equity interests of
the corporation or other entity surviving or resulting from such
merger, consolidation or recapitalization or acquiring such assets of
the Company, as the case may be (the "Surviving Entity") (or of its
ultimate parent corporation or other entity, if any), and (b) the
Combined Voting Power of the then outstanding Voting Securities of the
Surviving Entity (or of its ultimate parent corporation or other
entity, if any) or (2) the Incumbent Directors at the time of the
initial approval of such Acquisition Transaction would not
2
<PAGE>
immediately after such Acquisition Transaction constitute a majority
of the Board of Directors, or similar managing group, of the Surviving
Entity (or of its ultimate parent corporation or other entity, if
any), or (B) any plan or proposal for the liquidation or dissolution
of the Company; or
(c) Any Person shall be or become the beneficial owner (as
defined in Rules 13d-3 and 13d-5 under the Exchange Act), directly or
indirectly, of securities of the Company representing in the aggregate
more than twenty percent (20%) of either (A) the then outstanding
shares of common stock of the Company ("Common Shares") or (B) the
Combined Voting Power of all then outstanding Voting Securities of the
Company; provided, however, that notwithstanding the foregoing, a
Change in Control shall not be deemed to have occurred for purposes of
this Subsection (iii):
(1) Solely as a result of an acquisition of securities by the
Company which, by reducing the number of Common Shares or other
Voting Securities outstanding, increases (a) the proportionate
number of Common Shares beneficially owned by any Person to more
than twenty percent (20%) of the Common Shares then outstanding,
or (b) the proportionate voting power represented by the Voting
Securities beneficially owned by any Person to more than twenty
percent (20%) of the Combined Voting Power of all then
outstanding Voting Securities; or
(2) Solely as a result of an acquisition of securities
directly from the Company except for any conversion of a security
that was not acquired directly from the Company,
provided, further, that if any Person referred to in paragraph (1) or
(2) of this Subsection (iii) shall thereafter become the beneficial
owner of any additional Common Shares or other Voting Securities of
the Company (other than pursuant to a stock split, stock dividend or
similar transaction), then a Change in Control shall be deemed to have
occurred for purposes of this Subsection (iii).
(d) For purposes of this Section 2(d)(iii):
(1) "Affiliate" shall mean, as to a specified Person,
another Person that directly, or indirectly through one or more
intermediaries, controls or is controlled by, or is under common
control with, the specified Person, within the meaning of such
terms as used in Rule 405 under the Securities Act of 1933, as
amended ("Securities Act"), or any successor rule.
(2) "Combined Voting Power" shall mean the aggregate votes
entitled to be cast generally in the election of the Board of
Directors, or similar managing group, of a corporation or other
entity by holders of then outstanding Voting Securities of such
3
<PAGE>
corporation or other entity.
(3) "LCR" shall mean LYONDELL-CITGO Refining Company Ltd.
(from and after January 1, 1999, LYONDELL-CITGO Refining LP), a
Limited Liability Company organized under the laws of the State
of Texas.
(4) "Person" shall mean any individual, entity (including,
without limitation, any corporation, partnership, trust, joint
venture, association or governmental body) or group (as defined
in Sections 14(d)(3) or 15(d)(2) of the Exchange Act and the
rules and regulations thereunder); provided, however, that Person
shall not include the Company or LCR, any of their subsidiaries,
any employee benefit plan of the Company or LCR or any of their
majority-owned subsidiaries or any entity organized, appointed or
established by the Company, LCR or such subsidiaries for or
pursuant to the terms of any such plan.
(5) "Voting Securities" shall mean all securities of a
corporation or other entity having the right under ordinary
circumstances to vote in an election of the Board of Directors,
or similar managing group, of such corporation or other entity.
3. TERMINATION OF OPTION: The Option hereby granted shall terminate
and be of no force and effect with respect to any shares of Common Stock not
previously purchased by the Optionee upon the first to occur of:
(a) close of business on ___________;
(b) with respect to
(i) the portion of the Option exercisable upon termination (or which
becomes exercisable upon termination due to death, Disability or
Retirement), the expiration of (A) 90 days following the Optionee's
termination of Employment by the Company for reasons other than for cause
(as determined by the Committee), death, Disability or Retirement, or (B)
one year following the Optionee's termination of Employment by reason of
death, Disability or Retirement; and
(ii) the portion of the Option not exercisable upon termination for
any reason other than death, Disability or Retirement, the date of the
Optionee's termination of Employment; or
(c) the date of the Optionee's termination of Employment for any
reason other than those described in (b) above.
4. EXERCISE OF OPTION. Subject to the limitations set forth herein
and in the
4
<PAGE>
Plan, this Option may be exercised by written notice provided to the Company as
set forth in Section 5. Such written notice shall (a) state the number of shares
of Common Stock with respect to which the Option is being exercised and (b) be
accompanied by a check, cash or money order payable to Lyondell Chemical Company
in the full amount of the purchase price for any shares of Common Stock being
acquired or, at the option of the Optionee, accompanied by Common Stock
theretofore owned by such Optionee for at least six months that is equal in
value to the full amount of the purchase price (or any combination of cash,
check or such Common Stock). For purposes of determining the amount, if any, of
the purchase price satisfied by payment in Common Stock, such Common Stock shall
be valued at its Fair Market Value on the date of exercise. Any Common Stock
delivered in satisfaction of all or a portion of the purchase price shall be
appropriately endorsed for transfer and assignment to the Company.
The Optionee agrees that he will not exercise the Option granted
pursuant hereto, and that the Company will not be obligated to issue any Option
Shares pursuant to this Award Agreement, if the exercise of the Option or the
issuance of such shares would constitute a violation by the Optionee or by the
Company of any provision of any law or regulation of any governmental authority
or any stock exchange or transaction quotation system. Whether or not the
options and shares covered by the Plan have been registered pursuant to the
Securities Act, the Company may, at its election, require the Optionee to give a
representation in writing in form and substance satisfactory to the Company to
the effect that he is acquiring such shares for his own account for investment
and not with a view to, or for sale in connection with, the distribution of such
shares or any part thereof.
If any law or regulation requires the Company to take any action with
respect to the shares specified in such notice, the time for delivery thereof,
which would otherwise be as promptly as possible, shall be postponed for the
period of time necessary to take such action.
Notwithstanding anything to the contrary contained herein, the
Company, acting through the Committee, hereby reserves the right to deliver cash
in lieu of Option Shares upon the exercise of the Option. In such event, the
amount of cash to be paid shall be equal to the number of Option Shares that
would otherwise have been delivered multiplied by the excess of the Fair Market
Value of a share of Common Stock on the date of exercise over $12.9125.
5. NOTICES. Notice of exercise of the Option must be made in the
following manner, using such forms as the Company may from time to time provide:
(a) by registered or certified United States mail, postage prepaid, to
Lyondell Chemical Company, Attn: Corporate Secretary, 1221 McKinney Street,
Suite 700, Houston, Texas 77010, in which case the date of exercise shall
be the date of mailing; or
(b) by hand delivery or otherwise to Lyondell Chemical Company, Attn:
Corporate Secretary, 1221 McKinney Street, Suite 700, Houston, Texas 77010,
in which case the date of exercise shall be the date when receipt is
acknowledged by the Company.
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Notwithstanding the foregoing, (i) in the event that the address of the
Company is changed prior to the date of any exercise of this Option, notice of
exercise shall instead be made pursuant to the foregoing provisions at the
Company's current address, or (ii) in the event that the Committee delegates
the administration of option exercises to a third party administrator pursuant
to Section 3 of the Plan, notice of exercise shall instead be made pursuant to
the written instructions given to the Optionee by the third party
administrator with respect to option exercise.
Any other notices provided for in this Award Agreement or in the Plan
shall be given in writing and shall be deemed effectively delivered or given
upon receipt or, in the case of notices delivered by the Company to the
Optionee, five days after deposit in the United States mail, postage prepaid,
addressed to the Optionee at the address specified at the end of this Award
Agreement or at such other address as the Optionee hereafter designates by
written notice to the Company.
6. ASSIGNMENT OF OPTION. The Optionee's rights under the Plan and
this Award Agreement are personal; no assignment or transfer of the Optionee's
rights under and interest in this Option may be made by the Optionee otherwise
than by will or by the laws of descent and distribution; and this Option is
exercisable during his lifetime only by the Optionee. Notwithstanding the
foregoing, the Option is transferable by the Optionee to (i) the children or
grandchildren of the Optionee ("Immediate Family Members"), (ii) a trust or
trusts for the exclusive benefit of such Immediate Family Members ("Immediate
Family Member Trusts"), or (iii) a partnership or partnerships in which such
Immediate Family Members have at least ninety-nine percent (99%) of the equity,
profit and loss interests ("Immediate Family Member Partnerships"). Subsequent
transfers of a transferred Option shall be prohibited except by will or the laws
of descent and distribution, unless such transfers are made to the original
Optionee or a person to whom the original Optionee could have made a transfer in
the manner described herein. No transfer shall be effective unless and until
written notice of such transfer is provided to the Committee, in the form and
manner prescribed by the Committee. Following transfer, any the Option shall
continue to be subject to the same terms and conditions as were applicable
immediately prior to transfer, and, except as otherwise provided herein, the
term "Optionee" shall be deemed to refer to the transferee. The consequences of
termination of employment shall continue to be applied with respect to the
original Optionee, following which the Options shall be exercisable by the
transferee only to the extent and for the periods specified in the Plan and this
Award Agreement.
After the death of the Optionee, exercise of the Option shall be permitted
only by the Optionee's executor or the personal representative of the Optionee's
estate (or by his assignee, in the event of a permitted assignment) and only to
the extent that the Option was exercisable on the date of the Optionee's death.
7. STOCK CERTIFICATES. Certificates representing the Common Stock
issued pursuant to the exercise of the Option will bear all legends required by
law and necessary or advisable to effectuate the provisions of the Plan and this
Option.
8. CERTAIN LIMITS. Notwithstanding the foregoing, unless otherwise
provided by the Company pursuant to a separate written agreement or plan
covering the
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<PAGE>
Optionee, to the extent an Optionee would be subject to the excise tax under
Section 4999 of the Internal Revenue Code of 1986, as amended (the "Code"), on
the amounts payable pursuant to this Award Agreement and such other amounts or
benefits the Optionee receives from the Company, any person whose actions result
in a change of ownership covered by Section 280G(b)(2) of the Code or any person
affiliated with the Company or such person, required to be included in the
calculation of parachute payments for purposes of Sections 280G and 4999 of the
Code, the amounts vested pursuant to this Award Agreement shall be automatically
reduced to an amount one dollar less than that which, when combined with such
other amounts, would subject the Optionee to such excise tax.
9. WITHHOLDING. No certificates representing shares of Common Stock
purchased hereunder shall be delivered to or in respect of an Optionee unless
the amount of all federal, state and other governmental withholding tax
requirements imposed upon the Company with respect to the issuance of such
shares of Common Stock has been remitted to the Company or unless provisions to
pay such withholding requirements have been made to the satisfaction of the
Committee. The Committee may make such provisions as it may deem appropriate
for the withholding of any taxes which it determines is required in connection
with this Option. The Optionee may pay all or any portion of the taxes required
to be withheld by the Company or paid by the Optionee in connection with the
exercise of all or any portion of this Option by delivering cash, or by electing
to have the Company withhold shares of Common Stock, or by delivering previously
owned shares of Common Stock, having a Fair Market Value determined in
accordance with the Plan equal to the amount required to be withheld or paid.
The Optionee must make the foregoing election on or before the date that the
amount of tax to be withheld is determined.
10. SHAREHOLDER RIGHTS. The Optionee shall have no rights of a
shareholder with respect to shares of Common Stock subject to the Option unless
and until such time as the Option has been exercised and ownership of such
shares of Common Stock has been transferred to the Optionee.
11. SUCCESSORS AND ASSIGNS. This Award Agreement shall bind and
inure to the benefit of and be enforceable by the Optionee, the Company and
their respective permitted successors and assigns (including personal
representatives, heirs and legatees), except that the Optionee may not assign
any rights or obligations under this Award Agreement except to the extent and in
the manner expressly permitted herein.
12. NO EMPLOYMENT GUARANTEED. No provision of this Award Agreement
shall confer any right upon the Optionee to continued employment with the
Company or any Subsidiary.
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<PAGE>
13. GOVERNING LAW. This Award Agreement shall be governed by,
construed and enforced in accordance with the laws of the State of Texas.
LYONDELL CHEMICAL COMPANY
Date:____________________ Signed:_________________________________
Name:___________________________________
Title:__________________________________
8
<PAGE>
Exhibit 4.7
RESTRICTED STOCK GRANT
----------------------
PURSUANT TO THE TERMS OF THE
LYONDELL CHEMICAL COMPANY 1999 LONG-TERM INCENTIVE PLAN
-------------------------------------------------------
1. GRANT OF RESTRICTED SHARES. Lyondell Chemical Company, a Delaware
corporation ("Company"), hereby grants, effective as of ________________, ____,
to _____________________ ("Participant") all rights, title and interest in the
record and beneficial ownership of _______________ shares (the "Restricted
Shares") of common stock, $1.00 par value per share, of Company ("Company
Stock") subject to the conditions described in Paragraph 3 as well as the other
provisions of this grant of Restricted Stock (the "Restricted Stock Grant").
The Restricted Shares are granted pursuant to the Lyondell Chemical Company 1999
Long-Term Incentive Plan (as amended and in effect from time to time, the
"Plan") and are subject to the provisions of the Plan, which is hereby
incorporated herein and is made a part hereof, as well as the provisions of this
document. By acceptance of this Restricted Stock Grant, Participant agrees to
be bound by all of the terms, provisions, conditions and limitations of the Plan
as implemented by this Restricted Stock Grant. All capitalized terms have the
meanings set forth in the Plan unless otherwise specifically provided.
2. CUSTODY OF RESTRICTED SHARES. Upon satisfaction of the vesting conditions
set forth in Paragraph 3, Company shall issue and deliver to Participant a
certificate or certificates for such number of Restricted Shares as are required
to be issued and delivered under this Restricted Stock Grant unless Participant
elects to hold such shares on an uncertificated basis through the Company's
stock transfer agent or such other agent as the Company may from time to time
designate. Prior to the satisfaction of such vesting conditions or the
occurrence of such events, the Restricted Shares may not be sold, transferred,
assigned, pledged or otherwise encumbered or disposed of, and shall be held in
custody by the Company until such time as the restrictions on their transfer
have lapsed.
3. VESTING. The total number of Restricted Shares subject to this Restricted
Stock Grant shall vest on [DESCRIBE SCHEDULE] or, if earlier, the date of the
Retirement, death or Disability of Participant, or occurrence of a Change of
Control. Should Participant's employment with Company and any Subsidiaries
terminate prior to the earlier of [DESCRIBE SCHEDULE], or the date of any Change
of Control for any reason other than Retirement, death or Disability of
Participant, Participant shall forfeit the right to receive the Restricted
Shares.
For vesting purposes Retirement means a termination of employment
initiated voluntarily by the Participant (i) on or after age 65 or (ii) on or
after age 55 with 10 years of participation service as credited under the
Company's qualified defined benefit pension plan. Disability means a permanent
and total disability as defined in the Company's Executive Long-Term Disability
Plan.
4. OWNERSHIP RIGHTS. Subject to the restrictions set forth herein,
Participant is entitled to voting rights and to the right to receive any cash
dividends that may be paid on Restricted Shares, whether or not vested.
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<PAGE>
5. REORGANIZATION OF COMPANY AND SUBSIDIARIES. The existence of the
restricted Stock Grant shall not affect in any way the right or power of Company
or its stockholders to make or authorize any or all adjustments,
recapitalizations, reorganizations or other changes in Company's capital
structure or its business, or any merger or consolidation of Company or any
issue of bonds, debentures, preferred or prior preference stock ahead of or
affecting the Restricted Shares or the rights thereof, or the dissolution or
liquidation of Company, or any sale or transfer of all or any part of its assets
or business, or any other corporate act or proceeding, whether of a similar
character or otherwise.
6. NO GUARANTEE OF EMPLOYMENT. This Restricted Stock Grant shall not confer
upon Participant any right with respect to continuance of employment or other
service with Company or any Subsidiary, nor shall it interfere in any way with
any right Company or any Subsidiary would otherwise have to terminate such
Participant's employment or other service at any time.
7. WITHHOLDING OF TAXES. The Company shall have the right to take such
action as may be necessary or appropriate to satisfy any tax withholding
obligations.
LYONDELL CHEMICAL COMPANY
_____________________________________
By:__________________________________
Printed Name:________________________
Title:_______________________________
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<PAGE>
ACKNOWLEDGMENT
The undersigned, _________________________, grantee of the award of Restricted
Shares pursuant to this Agreement, hereby acknowledges receipt of a copy of this
Agreement and understands that his rights in respect of the Restricted Shares
may be forfeited as provided in this Agreement.
Dated ______________, 1999
PARTICIPANT
____________________________________
Printed
Name:________________________
As the Restricted Shares vest, Participant is entitled to receive a
certificate representing such vested shares. Alternatively, Participant may
elect to hold such shares on an uncertificated basis through the Company's stock
transfer agent. UNCERTIFICATED SHARES ARE FULLY TRANSFERRABLE AND CARRY THE SAME
RIGHTS OF OWNERSHIP AS CERTIFICATED SHARES. Please elect one of the two options
listed below with respect to the shares subject to this grant.
_________ I hereby elect to hold my vested shares on an uncertificated basis
through the Company's stock transfer agent. I understand that I am
entitled to quarterly statements of my account status, to receive
dividends and all other relevant tax and other reports with respect
to such shares and to request a certificate or certificates
evidencing the shares.
_________ I hereby elect to receive certificates evidencing my vested shares.
PARTICIPANT
____________________________________
Printed Name:________________________
If Participant fails to elect one of the alternatives, the shares will held for
Participant on an uncertificated basis.
3
<PAGE>
Exhibit 4.8
LYONDELL CHEMICAL COMPANY
1999 LONG-TERM INCENTIVE PLAN
PERFORMANCE SHARE AGREEMENT
1999-2001 PERFORMANCE CYCLE
Lyondell Chemical Company (the "Company") hereby grants on ___________,
____, ______ (the "Grant Date"), subject to shareholder approval as provided
below, to ________________ (the "Participant"), an employee of the Company,
_________ Target Performance Shares, as defined below, such number being subject
to adjustment as provided in Section 11 of the Lyondell Chemical Company 1999
Long-Term Incentive Plan (the "Plan"), for the 1999-2001 Performance Cycle, as
defined below. This grant of Performance Shares represents the opportunity for
the Participant, over the course of the 1999-2001 Performance Cycle, to earn an
Award Payment, as defined below, depending on the Company's performance and
subject to the following terms and conditions:
1. RELATIONSHIP TO PLAN; DEFINITIONS.
This grant of Performance Shares is subject to all of the terms,
conditions and provisions of the Plan and administrative interpretations
thereunder, if any, which have been adopted by the Committee thereunder and are
in effect on the date hereof, and is subject to the approval of the Plan by the
shareholders of the Company as provided in Section 19 of the Plan. Except as
defined herein, capitalized terms shall have the same meanings ascribed to them
under the Plan.
For purposes of this Award Agreement, the following definitions apply:
"1999-2001 Performance Cycle" means the period from January 1,
1999 to December 31, 2001.
"Award Opportunity" means the percentage of the Participant's
Target Performance Shares payable upon the achievement of a
Performance Goal. The Award Opportunity for each Performance Goal is
listed in Section 3(a).
"Award Payment" means the amount payable pursuant to this Award
Agreement upon the achievement of a Performance Goal.
"Change in Control" shall be deemed to have occurred as of the
date that one or more of the following occurs:
(a) Individuals who, as of the date hereof, constitute the entire
Board of Directors of the Company ("Incumbent Directors") cease for
any reason to constitute at least a majority of the Board; provided,
however, that any individual becoming a director subsequent to the
date hereof whose election, or nomination for election by the
Company's shareholders, was approved by a vote of at least a majority
of the then Incumbent Directors shall be considered as though such
individual was an Incumbent Director, but excluding, for this purpose
any such individual whose initial assumption of office occurs as a
result of either an actual
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<PAGE>
or threatened election contest, as such terms are used in Rule 14a-11
under the Exchange Act or other actual or threatened solicitation of
proxies or consents by or on behalf of any Person (as defined below)
other than the Board;
(b) The stockholders of the Company shall approve (A) any merger,
consolidation or recapitalization of the Company (or, if the capital
stock of the Company is affected, any subsidiary of the Company), or
any sale, lease, or other transfer (in one transaction or a series of
transactions contemplated or arranged by any party as a single plan)
of all or substantially all of the assets of the Company (each of the
foregoing being an "Acquisition Transaction") where (1) the
shareholders of the Company immediately prior to such Acquisition
Transaction would not immediately after such Acquisition Transaction
beneficially own, directly or indirectly, shares or other ownership
interests representing in the aggregate eighty percent (80%) or more
of (a) the then outstanding common stock or other equity interests of
the corporation or other entity surviving or resulting from such
merger, consolidation or recapitalization or acquiring such assets of
the Company, as the case may be (the "Surviving Entity") (or of its
ultimate parent corporation or other entity, if any), and (b) the
Combined Voting Power of the then outstanding Voting Securities of the
Surviving Entity (or of its ultimate parent corporation or other
entity, if any) or (2) the Incumbent Directors at the time of the
initial approval of such Acquisition Transaction would not immediately
after such Acquisition Transaction constitute a majority of the Board
of Directors, or similar managing group, of the Surviving Entity (or
of its ultimate parent corporation or other entity, if any), or
(B) any plan or proposal for the liquidation or dissolution of the
Company; or
(c) Any Person shall be or become the beneficial owner (as
defined in Rules 13d-3 and 13d-5 under the Exchange Act), directly or
indirectly, of securities of the Company representing in the aggregate
more than twenty percent (20%) of either (A) the then outstanding
shares of common stock of the Company ("Common Shares") or (B) the
Combined Voting Power of all then outstanding Voting Securities of the
Company; provided, however, that notwithstanding the foregoing, a
Change in Control shall not be deemed to have occurred for purposes of
this Subsection (iii):
(1) Solely as a result of an acquisition of securities by
the Company which, by reducing the number of Common Shares or
other Voting Securities outstanding, increases (a) the
proportionate number of Common Shares beneficially owned by any
Person to more than twenty percent (20%) of the Common Shares
then outstanding, or (b) the proportionate voting power
represented by the Voting Securities beneficially owned by any
Person to more than twenty percent (20%) of the Combined Voting
Power of all then outstanding Voting Securities; or
(2) Solely as a result of an acquisition of securities
directly from the Company except for any conversion of a security
that was not acquired directly from the Company;
2
<PAGE>
provided, further, that if any Person referred to in paragraph (1) or
(2) of this Subsection (iii) shall thereafter become the beneficial
owner of any additional Common Shares or other Voting Securities of
the Company (other than pursuant to a stock split, stock dividend or
similar transaction), then a Change in Control shall be deemed to have
occurred for purposes of this Subsection (iii).
(d) For purposes of this definition:
(1) "Affiliate" shall mean, as to a specified Person,
another Person that directly, or indirectly through one or more
intermediaries, controls or is controlled by, or is under common
control with, the specified Person, within the meaning of such
terms as used in Rule 405 under the Securities Act of 1933, as
amended, or any successor rule.
(2) "Combined Voting Power" shall mean the aggregate votes
entitled to be cast generally in the election of the Board of
Directors, or similar managing group, of a corporation or other
entity by holders of then outstanding Voting Securities of such
corporation or other entity.
(3) "LCR" shall mean LYONDELL-CITGO Refining Company Ltd.
(from and after January 1, 1999, LYONDELL-CITGO Refining LP), a
Limited Liability Company organized under the laws of the State
of Texas.
(4) "Person" shall mean any individual, entity (including,
without limitation, any corporation, partnership, trust, joint
venture, association or governmental body) or group (as defined
in Sections 14(d)(3) or 15(d)(2) of the Exchange Act and the
rules and regulations thereunder); provided, however, that Person
shall not include the Company or LCR, any of their subsidiaries,
any employee benefit plan of the Company or LCR or any of their
majority-owned subsidiaries or any entity organized, appointed or
established by the Company, LCR or such subsidiaries for or
pursuant to the terms of any such plan.
(5) "Voting Securities" shall mean all securities of a
corporation or other entity having the right under ordinary
circumstances to vote in an election of the Board of Directors,
or similar managing group, of such corporation or other entity.
"Disability" means a permanent and total disability as defined in
the Company's Executive Long-Term Disability Plan.
"Maximum Performance" means TSR Ranking which is considered to be
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<PAGE>
outstanding performance. The Maximum Performance level is established
in Section 2(a).
"Peer Group" means, as of the end of the 1999-2001 Performance
Cycle, the companies that comprise the S&P Chemicals Index and the S&P
Mid-Cap Chemicals Index and that were also members of those indexes as
of the first day of the 1999-2001 Performance Cycle, or such other
group of companies as selected by the Committee in its discretion.
"Payment Date" means the date on which the Award Payment is made
to the Participant.
"Retirement" means a termination of employment initiated
voluntarily by the Participant (i) on or after age 65 or (ii) on or
after age 55 with 10 years of participation service as credited under
the Company's qualified defined benefit pension plan.
"Target Performance" means the expected TSR Ranking for the 1999-
2001 Performance Cycle. The Target Performance level is established
in Section 2(b).
"Target Performance Shares" means the number of Performance
Shares that the Participant may earn during the 1999-2001 Performance
Period if the Company achieves Target Performance.
"Threshold Performance" means a TSR Ranking considered to be the
minimum acceptable performance for payment of a Performance Award.
The Threshold Performance level is established in Section 2(c).
"Total Shareholder Return" means the change in the market price
of the Common Stock of the Company plus dividend yield, measured over
the course of the 1999-2001 Performance Cycle.
"TSR Ranking" means the relative performance of the Company's
Total Shareholder Return as compared to the Peer Group, expressed as a
percentile ranking.
2. PERFORMANCE GOALS
The Performance Goals for the 1999-2001 Performance Cycle are:
(a) Maximum Performance means a TSR Ranking of at least 80th
percentile.
(b) Target Performance means a TSR Ranking of at least 50th
percentile.
(c) Threshold Performance means a TSR Ranking of at least 30th
percentile.
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<PAGE>
3. AWARD OPPORTUNITY
(a) The following chart shows the number of Performance Shares
payable, as a percentage of the Target Performance Shares granted, for each
level of performance over the 1999-2001 Performance Cycle:
- ------------------------------------------------------------------------------
PERFORMANCE LEVEL % OF TARGET LEVEL OF PERFORMANCE
SHARES EARNED
- ------------------------------------------------------------------------------
Maximum Performance 200%
- ------------------------------------------------------------------------------
Target Performance 100%
- ------------------------------------------------------------------------------
Threshold Performance 20%
- ------------------------------------------------------------------------------
Below Threshold 0%
Performance
- ------------------------------------------------------------------------------
(b) The Award Opportunity for a TSR Ranking between Threshold
Performance and Target Performance, or between Target Performance and
Maximum Performance, shall be determined by interpolation between the
values listed in the chart in Section 3(a). However, in no event shall the
amount potentially payable to the Participant exceed, as a percentage of a
Participant's Target Performance Shares, the Award Opportunity for Maximum
Performance as listed in Section 3(a)
(c) The Award Payment will be equal to the product of (i) the number
of Performance Shares earned as determined pursuant to Sections 3(a) and
3(b) and (ii) the average Fair Market Value of a share of Common Stock for
the five trading days preceding the Payment Date.
4. PAYMENT OF AWARDS
(a) Payment of Awards. The Committee has sole and absolute authority
and discretion to determine the level of Performance Goal achieved. The
determination of the Committee, which shall be binding and conclusive on
the Participant, shall be communicated in writing to the Participant.
Notwithstanding anything in this Plan to the contrary, the Participant
shall not be entitled to a Performance Award unless and until the Committee
determines that the Performance Goals to which such Performance Award
relates have been satisfied.
(b) Form of Payment. The Award Payment will be paid, in the sole
discretion of the Committee, in cash or shares of Common Stock, or in any
combination of cash and shares of Common Stock.
(c) Timing of Payment. The Award Payment will be paid as soon as
practicable after the close of the 1999-2001 Performance Cycle, upon the
Committee's determination, in writing, that the Performance Goals have been
satisfied and subject to the remaining provisions of this Section 4. The
date of the payment is the "Payment
5
<PAGE>
Date" for purposes of this Award Agreement.
(d) Adjustments. The Committee may not retroactively change any
Performance Goals, except as and to the extent determined by the Committee
in the event of changes in accounting practices or extraordinary or
unanticipated circumstances, which could have a material effect on the
achievement of the Performance Goals. However, in no event may the
Committee increase the Award Opportunity (as a percentage of the Target
Performance Shares) associated with Maximum Performance.
(e) Termination, Death or Disability: Award Payments will be paid only
if the Participant is actually an Employee on the Payment Date, except as
indicated below and in Section 5.
(i) If the Participant's employment terminates for cause (as
determined by the Committee) or is terminated by the Participant not under
circumstances described in Subparagraph (e)(ii) or (iii) prior to the
Payment Date, the Participant shall forfeit any and all rights to payment
under this Award Agreement.
(ii) If the Participant's employment terminates due to death,
Disability or Retirement, or by the Company without cause
(as determined by the Committee), prior to the end of the
1999-2001 Performance Cycle, the Participant will be paid a
pro-rata portion of the Award Payment based on the number of
days of the 1999-2001 Performance Cycle that the Participant
was an employee. Such prorated payment will be made at the
time and in the form that all payments are normally made to
all other Participants under the Plan.
(iii) If the Participant's employment terminates due to death,
Disability or Retirement, or by the Company without cause,
(as determined by the Committee), after the end of the 1999-
2001 Performance Cycle but prior to the Payment Date, the
Participant will receive the full amount of Award Payment to
which the Participant would otherwise be entitled. Such
payment shall be made at the time and in the form that all
payments are normally made to all other Participants under
the Plan.
(iv) If the Participant's employment terminates because of death,
the Participant's beneficiary or beneficiaries, designated
by the Participant for purposes of this Award Agreement in
the manner prescribed by the Committee, or if there is no
such designation, under the Company's Group Life Insurance
Plan, or in the absence of any such beneficiary, the
Participant's surviving spouse, or if there is no surviving
spouse, the personal representative of such Participant's
estate, shall be entitled to receive the Performance Award
to which the Participant was entitled under this Section
4(e).
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<PAGE>
(v) Notwithstanding any provision in this Section 4 or any other
provision of the Plan to the contrary, for purposes of
determining whether the Participant has terminated
employment hereunder, "employment" means employment as an
Employee with the Company or any Subsidiary. Neither the
transfer of the Participant from employment by the Company
to employment by any Subsidiary, the transfer of the
Participant from employment by any Subsidiary to employment
by the Company, nor the transfer of the Participant between
Subsidiaries shall be deemed to be a termination of
employment of the Participant. Moreover, the employment of
the Participant shall not be deemed to have been terminated
because of the Participant's absence from active employment
on account of temporary illness or during authorized
vacation or during temporary leaves of absence, granted by
the Company or a Subsidiary for reasons of professional
advancement, education, health or government service, or
during military leave for any period if the Participant
returns to active employment within 90 days after the
termination of his military leave, or during any period
required to be treated as a leave of absence by virtue of
any valid law or agreement.
5. CHANGE IN CONTROL. Upon the occurrence of a Change in Control
prior to the end of the 1999-2001 Performance Cycle, an Award Payment shall be
payable to the Participant as if the date of the Change in Control was the end
of the 1999-2001 Performance Cycle and the Target Performance level had been
reached as of that date. Payment of the Award Payment under this section shall
be within 60 days after the date of the Change in Control. Notwithstanding the
foregoing, unless otherwise provided by the Company pursuant to a separate
written agreement or plan covering the Participant, to the extent the
Participant would be subject to the excise tax under Section 4999 of the
Internal Revenue Code of 1986, as amended (the "Code"), on the amounts above and
such other amounts or benefits the Participant receives from the Company, any
person whose actions result in a change of ownership covered by Section
280G(b)(2) of the Code or any person affiliated with the Company or such person,
required to be included in the calculation of parachute payments for purposes of
Sections 280G and 4999 of the Code, the amounts provided under this Agreement
shall be automatically reduced to an amount one dollar less than that, when
combined with such other amounts, would subject the Participant to such excise
tax.
6. ASSIGNMENT OF AWARD. The Participant's rights under the Plan and
this Award Agreement are personal; no assignment or transfer of the
Participant's rights under and interest in this Award Agreement may be made by
the Participant other than pursuant to a marital settlement agreement or similar
domestic relations agreement, decree or order. Any attempted assignment or
transfer in violation of this Section shall be null and void.
7. WITHHOLDING. No cash payments and no certificates representing
shares of Common Stock awarded hereunder shall be delivered to or in respect of
the Participant unless the amount of all federal, state and other governmental
withholding tax requirements imposed
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<PAGE>
upon the Company with respect to the payment or the issuance of such shares of
Common Stock has been remitted to the Company or unless provisions to pay such
withholding requirements have been made to the satisfaction of the Committee.
The Committee may make such provisions as it may deem appropriate for the
withholding of any taxes which it determines is required in connection with this
Award Agreement. The Participant may pay all or any portion of the taxes
required to be withheld by the Company or paid by the Participant in connection
with this Award Agreement by delivering cash, or by electing to have the Company
withhold shares of Common Stock, or by delivering previously owned shares of
Common Stock, having a Fair Market Value determined in accordance with the Plan
equal to the amount required to be withheld or paid. The Participant must make
the foregoing election on or before the date that the amount of tax to be
withheld is determined.
8. SHAREHOLDER RIGHTS. The Participant shall have no rights of a
shareholder with respect to shares of Common Stock potentially deliverable
pursuant to this Award Agreement unless and until such time as the ownership of
such shares of Common Stock has been transferred to the Participant.
9. SUCCESSORS AND ASSIGNS. This Award Agreement shall bind and inure
to the benefit of and be enforceable by the Participant, the Company and their
respective permitted successors and assigns (including personal representatives,
heirs and legatees), except that the Participant may not assign any rights or
obligations under this Award Agreement except to the extent and in the manner
expressly permitted herein.
10. NO EMPLOYMENT GUARANTEED. No provision of this Award Agreement
shall confer any right upon the Participant to continued employment with the
Company or any Subsidiary.
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11. GOVERNING LAW. This Award Agreement shall be governed by,
construed and enforced in accordance with the laws of the State of Texas.
LYONDELL CHEMICAL COMPANY
Dated________________ By______________________________________
Name:___________________________________
Title:__________________________________
The Participant hereby accepts the foregoing Award Agreement, subject
to the terms and provisions of the Plan and administrative interpretations
thereof referred to above.
__________________________________ ____________________
Participant's Signature Date
__________________________________
Participant's Address
9
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Exhibit 4.9
LYONDELL CHEMICAL COMPANY
_________________________________________________________________
STOCK OPTION PLAN FOR NON-EMPLOYEE DIRECTORS
As Adopted Effective February 3, 2000
<PAGE>
LYONDELL CHEMICAL COMPANY
STOCK OPTION PLAN FOR NON-EMPLOYEE DIRECTORS
1. Purpose.
-------
The Stock Option Plan for Non-Employee Directors of Lyondell Chemical
Company (the "Plan") is intended to provide non-employee directors of
Lyondell Chemical Company (the "Company") with an increased proprietary
interest in the Company's success and progress by granting them options to
acquire shares of the Company's Common Stock ("Common Stock") in accordance
with the terms and conditions set forth below. The Plan is intended to
increase the alignment of non-employee directors with the Company's
shareholders.
2. Administration.
--------------
The Plan is to be administered by the Board of Directors of the Company
(the "Board"). The Directors Benefit Committee shall have all necessary
authority and discretion to interpret any provision of this Plan or to
determine any question regarding grants of options under this Plan. Any
determination or interpretations of the Directors Benefits Committee shall
be final, conclusive and binding on all persons.
3. Eligibility.
-----------
All current or subsequently elected members of the Board who at the time
such service began were not, and for the preceding ten years had not been,
executive officers or employees of the Company or any of its subsidiaries
("Eligible Directors") shall be eligible to participate in the Plan.
4. Grants.
------
The Board shall have full discretion to grant Options to individuals who
are Eligible Directors at the time the Option is granted. In exercising
such discretion, the Board shall obtain the advice of the Corporate
Governance Committee of the Board. The Board may, in its discretion,
provide for the extension of the exercisability of an Option, accelerate
the vesting or exercisability of an Option, eliminate or make less
restrictive any restrictions contained in an Award Agreement, waive any
restriction or other provision of this Plan or an Award Agreement or
otherwise amend or modify an Option in any manner that is either (i) not
adverse to the Eligible Director holding the Option or (ii) consented to by
such Eligible Director. The grant of options to acquire Common Stock
awarded to non-employee directors of the Company at the meeting of the
Board on February 3, 2000 shall be included in this Plan for administration
purposes.
5. Terms and Conditions of Options.
-------------------------------
(a) Award Agreement. Each Option granted hereunder shall be described
in an Award Agreement, which shall be subject to the terms and conditions
of the Plan and shall
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be signed by the Eligible Director and by the appropriate officer for and
on behalf of the Company.
(b) General Terms. Options granted hereunder shall be nonqualified
options within the meaning of Section 83 of the Internal Revenue Code of
1986, as amended (the "Code"). The Option shall contain such terms and
conditions as may be approved by the Board. Notwithstanding the
foregoing, however, the exercise price of an Option shall not be less than
the "Fair Market Value" (as hereinafter defined) of a share of Common Stock
on the date of grant of the Option, and shall not be less than the Fair
Market Value of a share of Common Stock on the date of grant of any
outstanding Option that is relinquished in connection with the grant of a
new Option. For purposes of this Plan, the term "Fair Market Value" shall
have the meaning given such term under the Company's 1999 Long-Term
Incentive Plan.
(c) Termination of Service. Upon the Eligible Director's termination
of service as a member of the Board, any unexercised Options shall be
treated as provided in the specific Award Agreement evidencing the Option.
Unless otherwise specifically provided in the Award Agreement, each Option
granted pursuant to this Plan shall immediately terminate to the extent the
Option is not vested (or does not become vested as a result of such
termination of service as a member of the Board) on the date the Eligible
Director terminates service as a member of the Board.
(d) Disability or Retirement. Notwithstanding the provisions of
subsection 5(c), if an Eligible Director ceases to be a member of the Board
by reason of death, Disability or Retirement, the Options granted to such
Eligible Director shall become immediately vested and exercisable.
For purposes of this section, the following definitions apply:
(i) "Disability" shall mean a permanent and total disability as
defined in Section 22(e)(3) of the Code.
(ii) "Retirement" shall mean ceasing to be a director of the Company
(i) on or after age 72 or (ii) at any time prior to age 72 with the
consent of a majority of the members of the Board other than the
Eligible Director.
6. Stock Option Exercise.
---------------------
The price at which shares of Common Stock may be purchased under an Option
shall be paid in full at the time of exercise in cash or, if permitted by
the Board, by means of tendering Common Stock or surrendering Restricted
Stock awarded under the Restricted Stock Plan for Non-Employee Directors,
valued at Fair Market Value on the date of exercise, or any combination
thereof. The Board shall determine acceptable methods for tendering Common
Stock or Restricted Stock to exercise an Option as it deems appropriate.
The Board may provide for procedures to permit the exercise of an Option by
use of the proceeds to be received from the sale of Common Stock issuable
pursuant to the exercise of the Option. Unless otherwise provided in the
applicable Award
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<PAGE>
Agreement, in the event shares of Restricted Stock are tendered as
consideration for the exercise of an Option, a number of the shares issued
upon the exercise of the Option, equal to the number of shares of
Restricted Stock used as consideration therefor, shall be subject to the
same restrictions as the Restricted Stock so submitted as well as any
additional restrictions that may be imposed by the Board.
7. Shares Available Under the Plan
-------------------------------
The Common Stock to be delivered upon exercise of an Option shall
be limited to treasury shares.
Any shares of Common Stock that are subject to Options under this
plan that are terminated, forfeited or surrendered or which expire
unexercised will again be available for option awards under this Plan.
8. Adjustments.
------------
(a) The existence of outstanding Options shall not affect in any
manner the right or power of the Company to make or authorize any or all
adjustments, recapitalization, reorganizations or other changes in the
ownership of the Company or its business or any merger or consolidation of
the Company, or any issue of bonds, debentures, preferred or prior
preference stock (whether or not such issue is prior to, on a parity with
or junior to the Common Stock) or other obligations, or the dissolution or
liquidation of the Company, or any sale or transfer of all or any part of
its assets or business, or any other Company act or proceeding of any kind,
whether or not of a character similar to that of the acts or proceedings
enumerated above.
(b) In the event of any Common Stock distribution or split,
recapitalization, extraordinary distribution, merger, consolidation,
combination or exchange of shares of Common Stock or similar change or upon
the occurrence of any other event that the Board, in its sole discretion,
deems appropriate, the (i) the number of shares of Common Stock covered by
outstanding Options; and (ii) the Exercise Price in respect of such Options
shall be adjusted as appropriate.
(c) In the event of a corporate merger, consolidation,
acquisition of property or stock, separation, reorganization or liquidation
(such event hereinafter referred to as a "Transaction"), the Board shall be
authorized (i) to issue or assume Options by means of substitution of new
Options, as appropriate, for previously issued Options or to assume
previously issued Options as part of such adjustment, (ii) to make
provision, prior to the Transaction, for the acceleration of the vesting
and exercisability of, or lapse of restrictions with respect to, Options or
(iii) in the event of a Transaction of which the Company is not the
surviving corporation, to (A) cancel Options and give the Eligible Director
an opportunity to exercise for 30 days prior to such cancellation or (B)
settle an Option by a cash payment equal to the difference between the Fair
Market Value per share of Common Stock on the date of the Transaction and
the exercise price of the Option, multiplied by the number of shares
subject to the Option.
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<PAGE>
9. Assignability.
-------------
Except as otherwise provided herein, no Option granted under this
Plan shall be sold, transferred, pledged, assigned or otherwise alienated
or hypothecated by an Eligible Director other than by will or the laws of
descent and distribution, and during the lifetime of an Eligible Director,
any Option shall be exercisable only by him, or, in the case of an Eligible
Director who is mentally incapacitated, the Option shall be exercisable by
his guardian or legal representative. The Board may prescribe and include
in applicable Award Agreements other restrictions on transfer. Any
attempted assignment or transfer in violation of this Section shall be null
and void. Upon the Eligible Director's death, the personal representative
or other person entitled to succeed to the rights of the Eligible Director
(the "Successor Optionee") may exercise such rights. A Successor Optionee
must furnish proof satisfactory to the Company of his or her right to
exercise the Option under the Eligible Director's will or under the
applicable laws of descent and distribution.
Subject to approval by the Board in its sole discretion, all or a
portion of the Option granted to an Eligible Director under the Plan may be
transferable by the Eligible Director, to the extent and only to the extent
specified in such approval, to (i) the children or grandchildren of the
Eligible Director ("Immediate Family Members"), (ii) a trust or trusts for
the exclusive benefit of such Immediate Family Members ("Immediate Family
Member Trusts"), or (iii) a partnership or partnerships in which such
Immediate Family Members have at least ninety-nine percent (99%) of the
equity, profit and loss interests ("Immediate Family Member Partnerships");
provided that the Award Agreement pursuant to which such Awards are granted
(or an amendment thereto) must expressly provide for transferability in a
manner consistent with this Section. Subsequent transfers of transferred
Awards shall be prohibited except by will or the laws of descent and
distribution, unless such transfers are made to the original Eligible
Director or a person to whom the original Eligible Director could have made
a transfer in the manner described herein. No transfer shall be effective
unless and until written notice of such transfer is provided to the Board,
in the form and manner prescribed by the Board. Following transfer, any
such Options shall continue to be subject to the same terms and conditions
as were applicable immediately prior to transfer, and, except as otherwise
provided herein, the term "Eligible Director" shall be deemed to refer to
the transferee. The consequences of termination of service as a director
shall continue to be applied with respect to the original Eligible
Director, following which the Options shall be exercisable by the
transferee only to the extent and for the periods specified in this Plan
and the Award Agreement.
10. Termination or Amendment of the Plan.
------------------------------------
The Board may at any time terminate the Plan and may from time to time
alter or amend the Plan or any part hereof (including any amendment deemed
necessary to ensure that the Company may comply with any regulatory
requirement) without shareholder approval, unless otherwise required by law
or by the rules of the Securities and Exchange Commission or New York Stock
Exchange. No termination or amendment of the Plan may, without the consent
of an Eligible Director, impair the rights of such director with respect to
Options previously granted under the Plan.
4
<PAGE>
11. Miscellaneous.
-------------
(a) Nothing in the Plan shall be deemed to create any obligation on the
part of the Board to nominate any director for re-election by the
Company's shareholders.
(b) The Company shall have the right to require, prior to the issuance or
delivery of any Common Stock upon exercise of an Option, payment by an
Eligible Director of any taxes required by law with respect to the
issuance or delivery of such shares.
12. Governing Law.
-------------
The Plan shall be construed according to the law of the State of Texas to
the extent federal law does not supersede and preempt state law.
13. Effective Date.
--------------
The Plan was originally effective as of February 1, 2000.
IN WITNESS WHEREOF, LYONDELL CHEMICAL COMPANY, acting by and through its duly
authorized officer, has caused this Instrument to be executed on March 2, 2000.
ATTEST: LYONDELL CHEMICAL COMPANY
By: /s/ Katie-Pat Bowman By: /s/ Gerald A. O'Brien
----------------------- ----------------------
Assistant Secretary Secretary
5
<PAGE>
Exhibit 4.10
LYONDELL CHEMICAL COMPANY
2000 NONQUALIFIED STOCK OPTION AWARD AGREEMENT
FOR NON-EMPLOYEE DIRECTORS
Lyondell Chemical Company (the "Company") hereby grants on February 3,
2000 the "Grant Date") to [PARTICIPANT] (the "Optionee"), a non-employee
director of the Company, a right (the "Option") to purchase from the Company up
to but not exceeding in the aggregate 5,000 shares of Common Stock, par value
$1.00 per share ("Option Shares"), of the Company ("Common Stock") at $12.9125
per share (the "Exercise Price"), such number of shares and such price per share
being subject to adjustment as provided in Section 8 hereof, and further subject
to the following terms and conditions:
1. ADMINISTRATION. The Directors Benefit Committee (the "Committee")
shall have all necessary authority and discretion to interpret any provision of
this Option or to determine any question regarding grant of options hereunder.
Any determination or interpretations of the Committee shall be final, conclusive
and binding on all persons.
2. EXERCISE SCHEDULE.
(a) This Option shall become exercisable in three cumulative
installments, with one-third of the Option Shares becoming exercisable on
February 3, 2001, an additional one-third of the Option Shares becoming
exercisable on February 3, 2002, and the final one-third of the Option
Shares becoming exercisable on February 3, 2003.
(b) This Option shall become fully exercisable, irrespective of the
limitations set forth in subparagraph (a) above, upon termination of his or
her service as a non-employee director of the Company due to death,
Disability or Retirement, or upon a Change in Control.
(c) This Option shall become fully exercisable, irrespective of the
limitations set forth in subparagraph (a) above, if, at any time prior to
February 3, 2003, the Fair Market Value per share of Common Stock is
greater than or equal to two times the Exercise Price for at least 5
consecutive trading days.
(d) For purposes of this Agreement, the following definitions apply:
(i) "Disability" means a permanent and total disability as
defined in Section 22(e)(3) of the Internal Revenue Code, as amended.
(ii) "Retirement" means ceasing to be a director of the Company
(i) on or after age 72 or (ii) at any time prior to age 72 with the
consent of a majority of the members of the Board of Directors other
than the Optionee.
(iii) "Change in Control" shall be deemed to have occurred as of
the date that one or more of the following occurs:
(a) Individuals who, as of the date hereof, constitute the entire
Board
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<PAGE>
of Directors of the Company ("Incumbent Directors") cease for any
reason to constitute at least a majority of the Board; provided,
however, that any individual becoming a director subsequent to the
date hereof whose election, or nomination for election by the
Company's shareholders, was approved by a vote of at least a majority
of the then Incumbent Directors shall be considered as though such
individual was an Incumbent Director, but excluding, for this purpose
any such individual whose initial assumption of office occurs as a
result of either an actual or threatened election contest, as such
terms are used in Rule 14a-11 under the Securities Exchange of 1934,
as amended ("Exchange Act") or other actual or threatened solicitation
of proxies or consents by or on behalf of any Person (as defined
below) other than the Board;
(b) The stockholders of the Company shall approve (A) any merger,
consolidation or recapitalization of the Company (or, if the capital
stock of the Company is affected, any subsidiary of the Company), or
any sale, lease, or other transfer (in one transaction or a series of
transactions contemplated or arranged by any party as a single plan)
of all or substantially all of the assets of the Company (each of the
foregoing being an "Acquisition Transaction") where (1) the
shareholders of the Company immediately prior to such Acquisition
Transaction would not immediately after such Acquisition Transaction
beneficially own, directly or indirectly, shares or other ownership
interests representing in the aggregate eighty percent (80%) or more
of (a) the then outstanding common stock or other equity interests of
the corporation or other entity surviving or resulting from such
merger, consolidation or recapitalization or acquiring such assets of
the Company, as the case may be (the "Surviving Entity") (or of its
ultimate parent corporation or other entity, if any), and (b) the
Combined Voting Power of the then outstanding Voting Securities of the
Surviving Entity (or of its ultimate parent corporation or other
entity, if any) or (2) the Incumbent Directors at the time of the
initial approval of such Acquisition Transaction would not immediately
after such Acquisition Transaction constitute a majority of the Board
of Directors, or similar managing group, of the Surviving Entity (or
of its ultimate parent corporation or other entity, if any), or (B)
any plan or proposal for the liquidation or dissolution of the
Company; or
(c) Any Person shall be or become the beneficial owner (as
defined in Rules 13d-3 and 13d-5 under the Exchange Act), directly or
indirectly, of securities of the Company representing in the aggregate
more than twenty percent (20%) of either (A) the then outstanding
shares of common stock of the Company ("Common Shares") or (B) the
Combined Voting Power of all then outstanding Voting Securities of the
Company; provided, however, that notwithstanding the foregoing, a
Change in Control shall not be deemed to have occurred for purposes of
this Subsection (iii):
(1) Solely as a result of an acquisition of securities by
the Company which, by reducing the number of Common Shares or
other Voting Securities outstanding, increases (a) the
proportionate number of Common Shares beneficially owned by any
Person to more than twenty percent (20%) of the Common Shares
then outstanding, or (b) the
2
<PAGE>
proportionate voting power represented by the Voting Securities
beneficially owned by any Person to more than twenty percent
(20%) of the Combined Voting Power of all then outstanding Voting
Securities; or
(2) Solely as a result of an acquisition of securities
directly from the Company except for any conversion of a security
that was not acquired directly from the Company,
provided, further, that if any Person referred to in paragraph (1) or
(2) of this Subsection (iii) shall thereafter become the beneficial
owner of any additional Common Shares or other Voting Securities of
the Company (other than pursuant to a stock split, stock dividend or
similar transaction), then a Change in Control shall be deemed to have
occurred for purposes of this Subsection (iii).
(d) For purposes of this Section 2(d)(iii):
(1) "Affiliate" shall mean, as to a specified Person,
another Person that directly, or indirectly through one or more
intermediaries, controls or is controlled by, or is under common
control with, the specified Person, within the meaning of such
terms as used in Rule 405 under the Securities Act of 1933, as
amended ("Securities Act"), or any successor rule.
(2) "Combined Voting Power" shall mean the aggregate votes
entitled to be cast generally in the election of the Board of
Directors, or similar managing group, of a corporation or other
entity by holders of then outstanding Voting Securities of such
corporation or other entity.
(3) "LCR" shall mean LYONDELL-CITGO Refining Company Ltd.
(from and after January 1, 1999, LYONDELL-CITGO Refining LP), a
Limited Liability Company organized under the laws of the State
of Texas.
(4) "Person" shall mean any individual, entity (including,
without limitation, any corporation, partnership, trust, joint
venture, association or governmental body) or group (as defined
in Sections 14(d)(3) or 15(d)(2) of the Exchange Act and the
rules and regulations thereunder); provided, however, that Person
shall not include the Company or LCR, any of their subsidiaries,
any employee benefit plan of the Company or LCR or any of their
majority-owned subsidiaries or any entity organized, appointed or
established by the Company, LCR or such subsidiaries for or
pursuant to the terms of any such plan.
(5) "Voting Securities" shall mean all securities of a
corporation or other entity having the right under ordinary
circumstances to vote in an election of the Board of Directors,
or
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<PAGE>
similar managing group, of such corporation or other entity.
3. TERMINATION OF OPTION: The Option hereby granted shall terminate
and be of no force and effect with respect to any shares of Common Stock not
previously purchased by the Optionee upon the first to occur of:
(a) close of business on February 2, 2010;
(b) with respect to
(i) the portion of the Option exercisable upon termination of
service (or which becomes exercisable upon termination due
to death, Disability or Retirement), the expiration of (A)
90 days following termination of the Optionee's service as a
director of the Company for reasons other than death,
Disability or Retirement, or (B) one year following the
Optionee's termination of service as a director by reason of
death, Disability or Retirement; and
(ii) the portion of the Option not exercisable upon termination
of service for any reason other than death, Disability or
Retirement, the date of termination of the Optionee's
service as a director.
4. EXERCISE OF OPTION. Subject to the limitations set forth herein,
this Option may be exercised by written notice provided to the Company as set
forth in Section 5. Such written notice shall (a) state the number of shares of
Common Stock with respect to which the Option is being exercised and (b) be
accompanied by a check, cash or money order payable to Lyondell Chemical Company
in the full amount of the purchase price for any shares of Common Stock being
acquired or, at the option of the Optionee, accompanied by Common Stock
theretofore owned by such Optionee for at least six months that is equal in
value to the full amount of the purchase price (or any combination of cash,
check or such Common Stock). For purposes of determining the amount, if any, of
the purchase price satisfied by payment in Common Stock, such Common Stock shall
be valued at its Fair Market Value on the date of exercise. Any Common Stock
delivered in satisfaction of all or a portion of the purchase price shall be
appropriately endorsed for transfer and assignment to the Company.
By acceptance of this Option, the Optionee agrees that he will not
exercise the Option granted pursuant hereto, and that the Company will not be
obligated to issue any Option Shares pursuant to this Agreement, if the exercise
of the Option or the issuance of such shares would constitute a violation by the
Optionee or by the Company of any provision of any law or regulation of any
governmental authority or any stock exchange or transaction quotation system.
Furthermore, the Optionee acknowledges that only shares of Treasury Stock may be
issued upon the exercise of this Option. Notwithstanding anything to the
contrary contained herein, this Option shall not be exercisable to the extent
the Company does not have sufficient shares of Treasury Stock and is not
permitted, under the terms of its charter documents or debt instruments, to
acquire shares of Treasury Stock to satisfy its obligations hereunder. Whether
or not the options and shares covered hereby have been registered pursuant to
the Securities Act, the Company may, at its election, require the Optionee to
give a representation in writing in form and substance satisfactory to the
Company to the effect that he is acquiring such shares for his
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<PAGE>
own account for investment and not with a view to, or for sale in connection
with, the distribution of such shares or any part thereof.
If any law or regulation requires the Company to take any action with
respect to the shares specified in such notice, the time for delivery thereof,
which would otherwise be as promptly as possible, shall be postponed for the
period of time necessary to take such action.
Notwithstanding anything to the contrary contained herein, the
Company, acting through the Committee, hereby reserves the right to deliver cash
in lieu of Option Shares upon the exercise of the Option. In such event, the
amount of cash to be paid shall be equal to the number of Option Shares that
would otherwise have been delivered multiplied by the excess of the Fair Market
Value of a share of Common Stock on the date of exercise over $12.9125.
5. NOTICES. Notice of exercise of the Option must be made in the
following manner, using such forms as the Company may from time to time provide:
(a) by registered or certified United States mail, postage prepaid, to
Lyondell Chemical Company, Attn: Corporate Secretary, 1221 McKinney Street,
Suite 700, Houston, Texas 77010, in which case the date of exercise shall
be the date of mailing; or
(b) by hand delivery or otherwise to Lyondell Chemical Company, Attn:
Corporate Secretary, 1221 McKinney Street, Suite 700, Houston, Texas 77010,
in which case the date of exercise shall be the date when receipt is
acknowledged by the Company.
Notwithstanding the foregoing, (i) in the event that the address of the Company
is changed prior to the date of any exercise of this Option, notice of exercise
shall instead be made pursuant to the foregoing provisions at the Company's
current address, or (ii) in the event that the Committee delegates the
administration of option exercises to a third party administrator, notice of
exercise shall instead be made pursuant to the written instructions given to the
Optionee by the third party administrator with respect to option exercise.
Any other notices provided for in this Agreement shall be given in
writing and shall be deemed effectively delivered or given upon receipt or, in
the case of notices delivered by the Company to the Optionee, five days after
deposit in the United States mail, postage prepaid, addressed to the Optionee at
the address specified at the end of this Agreement or at such other address as
the Optionee hereafter designates by written notice to the Company.
6. ASSIGNMENT OF OPTION. The Optionee's rights under this Agreement
are personal; no assignment or transfer of the Optionee's rights under and
interest in this Option may be made by the Optionee otherwise than by will or by
the laws of descent and distribution; and this Option is exercisable during his
lifetime only by the Optionee.
Notwithstanding the foregoing, the Option is transferable by the
Optionee to (i) the children or grandchildren of the Optionee ("Immediate Family
Members"), (ii) a trust or trusts for the exclusive benefit of such Immediate
Family Members ("Immediate Family Member Trusts"), or (iii) a partnership or
partnerships in which such Immediate Family Members have at least ninety-nine
percent (99%) of the equity, profit and loss interests ("Immediate Family
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<PAGE>
Member Partnerships"). Subsequent transfers of a transferred Option shall be
prohibited except by will or the laws of descent and distribution, unless such
transfers are made to the original Optionee or a person to whom the original
Optionee could have made a transfer in the manner described herein. No transfer
shall be effective unless and until written notice of such transfer is provided
to the Committee, in the form and manner prescribed by the Committee. Following
transfer, the Option shall continue to be subject to the same terms and
conditions as were applicable immediately prior to transfer, and, except as
otherwise provided herein, the term "Optionee" shall be deemed to refer to the
transferee. The consequences of termination of employment shall continue to be
applied with respect to the original Optionee, following which the Options shall
be exercisable by the transferee only to the extent and for the periods
specified in this Agreement.
After the death of the Optionee, exercise of the Option shall be permitted
only by the Optionee's executor or the personal representative of the Optionee's
estate (or by his assignee, in the event of a permitted assignment) and only to
the extent that the Option was exercisable on the date of the Optionee's death.
7. STOCK CERTIFICATES. Certificates representing the Common Stock
issued pursuant to the exercise of the Option will bear all legends required by
law and necessary or advisable to effectuate the provisions of this Option.
8. ADJUSTMENTS. (a) The existence of this Option shall not affect
in any manner the right or power of the Company to make or authorize any or
all adjustments, recapitalization, reorganizations or other changes in the
ownership of the Company or its business or any merger or consolidation of
the Company, or any issue of bonds, debentures, preferred or prior
preference stock (whether or not such issue is prior to, on a parity with
or junior to the Common Stock) or other obligations, or the dissolution or
liquidation of the Company, or any sale or transfer of all or any part of
its assets or business, or any other Company act or proceeding of any kind,
whether or not of a character similar to that of the acts or proceedings
enumerated above.
(b) In the event of any Common Stock distribution or split,
recapitalization, extraordinary distribution, merger, consolidation,
combination or exchange of shares of Common Stock or similar change or upon
the occurrence of any other event that the Board, in its sole discretion,
deems appropriate, the number of Option Shares and the Exercise Price shall
be adjusted as appropriate.
(c) In the event of a corporate merger, consolidation, acquisition of
property or stock, separation, reorganization or liquidation (such event
hereinafter referred to as a "Transaction"), the Board shall be authorized
(i) to assume this Option by means of substitution of new options, as
appropriate, (ii) to make provision, prior to the Transaction, for the
acceleration of the vesting and exercisability of, or lapse of restrictions
with respect to, this Option or (iii) in the event of a Transaction of
which the Company is not the surviving corporation, to (A) cancel this
Option and give the Optionee an opportunity to exercise for 30 days prior
to such cancellation or (B) settle this Option by a cash payment equal to
the difference between the Fair Market Value per share of Common Stock on
the date of the Transaction and the exercise price of this Option,
multiplied by the number of unexercised Option Shares.
6
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9. MISCELLANEOUS. Nothing in this Option shall be deemed to create
any obligation on the part of the Board to nominate the Optionee for re-election
by the Company's shareholders. The Company shall have the right to require,
prior to the issuance or delivery of any Common Stock upon exercise of this
Option, payment by the Optionee of any taxes required by law with respect to the
issuance or delivery of such shares.
10. SHAREHOLDER RIGHTS. The Optionee shall have no rights of a
shareholder with respect to shares of Common Stock subject to the Option unless
and until such time as the Option has been exercised and ownership of such
shares of Common Stock has been transferred to the Optionee.
11. SUCCESSORS AND ASSIGNS. This Agreement shall bind and inure to
the benefit of and be enforceable by the Optionee, the Company and their
respective permitted successors and assigns (including personal representatives,
heirs and legatees), except that the Optionee may not assign any rights or
obligations under this Agreement except to the extent and in the manner
expressly permitted herein.
12. GOVERNING LAW. This Agreement shall be governed by, construed
and enforced in accordance with the laws of the State of Texas.
LYONDELL CHEMICAL COMPANY
Date:_____________ Signed:_______________________________
Name:_________________________________
Title:________________________________
7
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Exhibit 5
May 4, 2000
Lyondell Chemical Company
1221 McKinney Street, Suite 1600
Houston, Texas 77002
Gentlemen:
I have acted as Deputy General Counsel for Lyondell Chemical Company (the
"Company") in connection with the registration under the Securities Act of 1933,
as amended, of an aggregate 10,000,000 shares (the "Shares") of Common Stock,
par value $1.00 per share, of the Company ("Common Stock") that may be issued
under the Company's 1999 Long-Term Incentive Plan or the Company's Stock Option
Plan for Non-Employee Directors (collectively, the "Plans").
In such capacity, I am familiar with the Company's Amended and Restated
Certificate of Incorporation and Amended and Restated Bylaws, as well as the
Plans. In addition, I, or attorneys working under my supervision, have examined
records of relevant corporate proceedings with respect to the offering of the
Shares under the Plans and such other records, instruments and documents
pertaining to the Company that I have deemed necessary for purposes of
delivering this opinion. I have also examined the Company's Registration
Statement on Form S-8 to which this opinion is an exhibit ("Registration
Statement"). I have assumed the genuineness of all signatures, the legal
capacity of all natural persons, the authenticity of all documents examined as
originals, the conformity to original documents of all documents examined as
certified or photostatic copies and the authenticity of the originals of such
copies.
In rendering the opinion set forth below, I have assumed that the Shares offered
and sold under the Stock Option Plan for Non-Employee Directors will consist
only of shares held by the Company as treasury stock.
Based on the foregoing and having regard for such legal considerations as I have
deemed relevant, I am of the opinion that the Shares have been duly authorized
and validly authorized for issuance and, when issued in accordance with the
terms of the Plans, will be duly and validly issued, fully paid and
nonassessable.
The foregoing opinion is limited in all respects to matters governed by the
General Corporation Law of the State of Delaware and the federal laws of the
United States of America, to the extent applicable.
I hereby consent to the filing of this opinion with the Securities and Exchange
Commission as an exhibit to the Registration Statement.
Sincerely,
Gerald A. O'Brien
Deputy General Counsel
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EXHIBIT 23.2
CONSENT OF INDEPENDENT ACCOUNTANTS
We hereby consent to the incorporation by reference in this Registration
Statement on Form S-8 of Lyondell Chemical Company of the following reports,
which appear in Lyondell Chemical Company's Annual Report on Form 10-K for the
year ended December 31, 1999.
. Our report dated February 18, 2000 on our audits of the consolidated
financial statements of Lyondell Chemical Company as of December 31, 1999 and
1998 and for each of the three years in the period ended December 31, 1999.
. Our report dated February 25, 2000 on our audits of the financial statements
of LYONDELL-CITGO Refining LP as of December 31, 1999 and for the year ended
December 31, 1999 and the year ended December 31, 1997.
. Our report dated February 18, 2000 on our audits of the consolidated
financial statements of Equistar Chemicals, LP as of December 31, 1999 and
1998 and for each of the two years in the period ended December 31, 1999 and
the period from December 1, 1997 (inception) to December 31, 1997.
PRICEWATERHOUSECOOPERS LLP
Houston, Texas
May 3, 2000
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EXHIBIT 23.3
INDEPENDENT AUDITOR'S CONSENT
We consent to the incorporation by reference in this Registration Statement on
Form S-8 of Lyondell Chemical Company of our report on the 1998 financial
statements of Lyondell-CITGO Refining LP dated February 11, 1999, appearing in
the Annual Report on Form 10-K of Lyondell Chemical Company for the year ended
December 31, 1999.
DELOITTE & TOUCHE LLP
Houston, Texas
May 3, 2000
