EXHIBIT 4.8
______________________________________
OCCIDENTAL PETROLEUM CORPORATION
AND
THE BANK OF NEW YORK,
TRUSTEE
PREFERRED SECURITIES GUARANTEE AGREEMENT
Dated as of [ ], 199[ ]
______________________________________
Table of Contents
Page
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ARTICLE I.
DEFINITIONS AND INTERPRETATION
Section 1.01. Definitions and Interpretation................................. 1
ARTICLE II.
TRUST INDENTURE ACT
Section 2.01. Trust Indenture Act; Application............................... 4
Section 2.02. Lists of Holders of Securities................................. 4
Section 2.03. Reports by Preferred Guarantee Trustee......................... 5
Section 2.04. Periodic Reports to Preferred Guarantee Trustee................ 5
Section 2.05. Evidence of Compliance with Conditions Precedent............... 5
Section 2.06. Events of Default; Waiver...................................... 5
Section 2.07. Event of Default; Notice....................................... 5
Section 2.08. Conflicting Interests.......................................... 6
ARTICLE III.
POWERS, DUTIES AND RIGHTS OF PREFERRED GUARANTEE TRUSTEE
Section 3.01. Powers and Duties of Preferred Guarantee Trustee............... 6
Section 3.02. Certain Rights of Preferred Guarantee Trustee.................. 7
Section 3.03. Not Responsible for Recitals or Issuance of Guarantee.......... 9
ARTICLE IV.
PREFERRED GUARANTEE TRUSTEE
Section 4.01. Preferred Guarantee Trustee; Eligibility....................... 9
Section 4.02. Appointment, Removal and Resignation of Preferred Guarantee
Trustee........................................................ 10
ARTICLE V.
GUARANTEE
Section 5.01. Guarantee...................................................... 10
Section 5.02. Waiver of Notice and Demand.................................... 10
Section 5.03. Obligations Not Affected....................................... 11
Section 5.04. Rights of Holders.............................................. 11
Section 5.05. Guarantee of Payment........................................... 12
Section 5.06. Subrogation.................................................... 12
Section 5.07. Independent Obligations........................................ 13
ARTICLE VI.
LIMITATION OF TRANSACTIONS; RANKING
Section 6.01. Limitation of Transactions..................................... 13
Section 6.02. Ranking........................................................ 13
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ARTICLE VII.
TERMINATION
Section 7.01. Termination.................................................... 14
ARTICLE VIII.
INDEMNIFICATION
Section 8.01. Exculpation.................................................... 14
Section 8.02. Indemnification................................................ 14
ARTICLE IX.
MISCELLANEOUS
Section 9.01. Successors and Assigns......................................... 15
Section 9.02. Amendments..................................................... 15
Section 9.03. Notices........................................................ 15
Section 9.04. Benefit........................................................ 16
Section 9.05. Governing Law.................................................. 16
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PREFERRED SECURITIES GUARANTEE AGREEMENT
This PREFERRED SECURITIES GUARANTEE AGREEMENT ("Guarantee Agreement"),
dated as of [ ], 199[ ], is executed and delivered by Occidental Petroleum
Corporation, a Delaware corporation (the "Guarantor"), and The Bank of New York,
as trustee (the "Preferred Guarantee Trustee"), for the benefit of the Holders
(as defined herein) from time to time of the Preferred Securities (as defined
herein) of Oxy Capital Trust [ ], a Delaware statutory business trust (the
"Issuer");
WHEREAS, pursuant to an Amended and Restated Declaration of Trust (the
"Declaration"), dated as of [ ], 199[ ], among the trustees of the Issuer named
therein, the Guarantor, as sponsor, and the holders from time to time of
undivided beneficial interests in the assets of the Issuer, the Issuer is
issuing on the date hereof $[ ],000,000 [(including $[ ],000,000 issued pursuant
to an over-allotment option provided for in the Purchase Agreement)][(or up to
$[ ] if the over-allotment option is exercised in full)] aggregate stated
liquidation amount of Preferred Securities designated the [ ]% Preferred
Securities (the "Preferred Securities");
WHEREAS, as incentive for the Holders to purchase the Preferred Securities,
the Guarantor desires to irrevocably and unconditionally to agree, to the extent
set forth in this Guarantee Agreement, to pay to the Holders of the Preferred
Securities the Guarantee Payments (as defined herein) and to make certain other
payments on the terms and conditions set forth herein;
WHEREAS, the Guarantor is also executing and delivering a guarantee
agreement (the "Common Securities Guarantee Agreement") in substantially
identical terms to this Guarantee Agreement for the benefit of the holders of
the Common Securities (as defined herein) except that if an Event of Default (as
defined in the Indenture (as defined herein)), has occurred and is continuing,
the rights of holders of the Common Securities to receive Guarantee Payments
under the Common Securities Guarantee Agreement are subordinated to the rights
of Holders of Preferred Securities to receive Guarantee Payments under this
Guarantee Agreement;
NOW, THEREFORE, in consideration of the purchase by each Holder of
Preferred Securities, which purchase the Guarantor hereby agrees shall benefit
the Guarantor, the Guarantor executes and delivers this Guarantee Agreement for
the benefit of the Holders.
ARTICLE I.
DEFINITIONS AND INTERPRETATION
Section 1.01. Definitions and Interpretation.
-------------------------------
In this Guarantee Agreement, unless the context otherwise requires:
(a) Capitalized terms used in this Guarantee Agreement but not defined in
the preamble above have the respective meanings assigned to them in this Section
1.01;
(b) a term defined anywhere in this Guarantee Agreement has the same
meaning throughout;
(c) all references to "the Guarantee Agreement" or "this Guarantee
Agreement" are to this Guarantee Agreement as modified, supplemented or amended
from time to time;
(d) all references in this Guarantee Agreement to Articles and Sections
are to Articles and Sections of this Guarantee Agreement unless otherwise
specified;
(e) a term defined in the Trust Indenture Act has the same meaning when
used in this Guarantee Agreement unless otherwise defined in this Guarantee
Agreement or unless the context otherwise requires; and
(f) a reference to the singular includes the plural and vice versa.
"Affiliate" has the same meaning as given to that term in Rule 405 of the
Securities Act of 1933, as amended, as in effect on the date of this Guarantee
Agreement.
"Authorized Officer" of a Person means any Person that is authorized to
bind such Person.
"Common Securities" means the securities representing common undivided
beneficial interests in the assets of the Issuer.
"Covered Person" means any Holder or beneficial owner of Preferred
Securities.
"Distribution" has the meaning specified in the Declaration.
"Event of Default" means a default by the Guarantor on any of its payment
or other obligations under this Guarantee Agreement.
"Guarantee Payments" means the following payments or distributions, without
duplication, with respect to the Preferred Securities, to the extent not paid or
made by the Issuer: (i) any accrued and unpaid Distributions which are required
to be paid on such Preferred Securities to the extent the Issuer shall have
funds available therefore, (ii) the redemption price, including all accrued and
unpaid Distributions to the date of redemption (the "Redemption Price") to the
extent the Issuer has funds available therefor, with respect to any Preferred
Securities called for redemption by the Issuer, and (iii) upon a voluntary or
involuntary dissolution, winding-up or termination of the Issuer (other than in
connection with the distribution of Subordinated Notes to the Holders in
exchange for Preferred Securities as provided in the Declaration), the lesser of
(a) the aggregate of the liquidation amount and all accrued and unpaid
Distributions on the Preferred Securities to the date of payment, to the extent
the Issuer shall have funds available therefor and (b) the amount of assets of
the Issuer remaining available for distribution to Holders in liquidation of the
Issuer (in either case, the "Liquidation Distribution"). If an Event of Default
(as defined in the Indenture), has occurred and is continuing, the rights of the
holders of the Common Securities to receive Guarantee Payments under the Common
Securities Guarantee Agreement are subordinated to the rights of Holders of
Preferred Securities to receive Guarantee Payments under this Guarantee
Agreement.
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"Guarantor" shall mean Occidental Petroleum Corporation, a Delaware
corporation or any permitted successor thereof under the Indenture, in its
capacity as guarantor under this Guarantee Agreement.
"Holder" shall mean any holder, as registered on the books and records of
the Issuer, of any Preferred Securities; provided, however, that in determining
whether the holders of the requisite percentage of Preferred Securities have
given any request, notice, consent or waiver hereunder, "Holder" shall not
include the Guarantor or any Affiliate of the Guarantor.
"Indemnified Person" means the Preferred Guarantee Trustee, any Affiliate
of the Preferred Guarantee Trustee, or any officers, directors, shareholders,
members, partners, employees, representatives or agents of the Preferred
Guarantee Trustee.
"Indenture" means the Indenture dated as of [ ], 199[ ] among the Guarantor
and The Bank of New York, as trustee, as supplemented by the Officers'
Certificate (as defined in the Indenture) dated [ ], 199[ ].
"Majority in liquidation amount of the Preferred Securities" means, except
as provided by the Trust Indenture Act, Holder(s) of Preferred Securities voting
separately as a class, who vote Preferred Securities and the aggregate
liquidation amount (including the stated amount that would be paid on
redemption, liquidation or otherwise, plus accrued and unpaid Distributions to
the date upon which the voting percentages are determined) of the Preferred
Securities voted by such Holders represents more than 50% of the above stated
liquidation amount of all Preferred Securities.
"Officers' Certificate" means, with respect to any Person, a certificate
signed by two Authorized Officers of such Person. Any Officers' Certificate
delivered with respect to compliance with a condition or covenant provided for
in this Guarantee Agreement shall include:
(a) a statement that each officer signing the Certificate has read the
covenant or condition and the definition relating thereto;
(b) a brief statement of the nature and scope of the examination or
investigation undertaken by each officer in rendering the Certificate;
(c) a statement that each such officer has made such examination or
investigation as, in such officer's opinion, is necessary to enable such officer
to express an informed opinion as to whether or not such covenant or condition
has been complied with; and
(d) a statement as to whether, in the opinion of each such officer, such
condition or covenant has been complied with.
"Person" means a legal person, including any individual, corporation,
estate, partnership, joint venture, association, joint stock company, limited
liability company, trust, unincorporated association, or government or any
agency or political subdivision thereof, or any other entity of whatever nature.
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"Preferred Guarantee Trustee" means The Bank of New York until a Successor
Preferred Guarantee Trustee has been appointed and has accepted such appointment
pursuant to the terms of this Guarantee Agreement and thereafter means each such
Successor Preferred Guarantee Trustee.
"Responsible Officer" means, with respect to the Preferred Guarantee
Trustee, the chairman of the board of directors, the president, any vice-
president, any assistant vice-president, the secretary, any assistant secretary,
the treasurer, any assistant treasurer, any trust officer or assistant trust
officer or any other officer of the Preferred Guarantee Trustee customarily
performing functions similar to those performed by any of the above designated
officers and also means, with respect to a particular corporate trust matter,
any other officer to whom such matter is referred because of that officer's
knowledge of and familiarity with the particular subject.
"Subordinated Notes" means the series of subordinated debt securities of
the Guarantor designated the [ ]% Subordinated Notes due 20[ ].
"Successor Preferred Guarantee Trustee" means a successor Preferred
Guarantee Trustee possessing the qualifications to act as Preferred Guarantee
Trustee under Section 4.01.
"Trust Indenture Act" means the Trust Indenture Act of 1939, as amended.
ARTICLE II.
TRUST INDENTURE ACT
Section 2.01. Trust Indenture Act; Application.
---------------------------------
(a) This Guarantee Agreement is subject to the provisions of the Trust
Indenture Act that are required to be part of this Guarantee Agreement and
shall, to the extent applicable, be governed by such provisions; and
(b) if and to the extent that any provision of this Guarantee Agreement
limits, qualifies or conflicts with the duties imposed by (S)(S) 310 to 317,
inclusive, of the Trust Indenture Act, such imposed duties shall control.
Section 2.02. Lists of Holders of Securities.
-------------------------------
(a) The Guarantor shall provide the Preferred Guarantee Trustee (i)
semiannually, not later than June 30 and December 31 in each year, a list, in
such form as the Preferred Guarantee Trustee may reasonably require, containing
all the information in the possession or control of the Guarantor, or any of its
Paying Agents other than the Preferred Guarantee Trustee, as to the names and
addresses of the Holders of Securities ("List of Holders") as of the preceding
June 15 or December 15, as the case may be, and (ii) at such other times as the
Preferred Guarantee Trustee may request in writing, within 30 days after the
receipt by the Guarantor of any such request, a list of similar form and content
as of a date not more than 15 days prior to the time such list is furnished. The
Preferred Guarantee Trustee may destroy any List of Holders previously given to
it on receipt of a new List of Holders; and
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(b) the Preferred Guarantee Trustee shall comply with its obligations
under (S)(S) 311(a), 311(b) and 312(b) of the Trust Indenture Act.
Section 2.03. Reports by Preferred Guarantee Trustee.
---------------------------------------
Within 60 days after May 15 of each year commencing May [ ], the Preferred
Guarantee Trustee shall provide to the Holders of the Preferred Securities such
reports as are required by (S) 313 of the Trust Indenture Act, if any, in the
form and in the manner provided by (S) 313 of the Trust Indenture Act. The
Preferred Guarantee Trustee shall also comply with the requirements of (S)
313(d) of the Trust Indenture Act.
Section 2.04. Periodic Reports to Preferred Guarantee Trustee.
------------------------------------------------
The Guarantor shall provide to the Preferred Guarantee Trustee such
documents, reports and information as required by (S) 314 (if any) and the
compliance certificate required by (S) 314 of the Trust Indenture Act in the
form, in the manner and at the times required by (S) 314 of the Trust Indenture
Act.
Section 2.05. Evidence of Compliance with Conditions Precedent.
-------------------------------------------------
The Guarantor shall provide to the Preferred Guarantee Trustee such
evidence of compliance with any conditions precedent, if any, provided for in
this Guarantee Agreement which relate to any of the matters set forth in (S)
314(c) of the Trust Indenture Act. Any certificate or opinion required to be
given by an officer pursuant to (S) 314(c)(1) may be given in the form of an
Officers' Certificate.
Section 2.06. Events of Default; Waiver.
--------------------------
The Holders of a Majority in liquidation amount of Preferred Securities
may, by vote, on behalf of the Holders of all of the Preferred Securities, waive
any past Event of Default and its consequences. Upon such waiver, any such
Event of Default shall cease to exist, and any Event of Default arising
therefrom shall be deemed to have been cured, for every purpose of this
Guarantee Agreement, but no such waiver shall extend to any subsequent or other
default or Event of Default or impair any right consequent thereon.
Section 2.07. Event of Default; Notice.
-------------------------
(a) The Preferred Guarantee Trustee shall, within 90 days after the
occurrence of an Event of Default known to the Preferred Guarantee Trustee,
transmit by mail, first class postage prepaid, to the Holders of the Preferred
Securities, notices of all such Events of Default, unless such defaults have
been cured or waived before the giving of such notice, provided, that, the
Preferred Guarantee Trustee shall be protected in withholding such notice if and
so long as the board of directors, the executive committee, or a trust committee
of directors and/or Responsible Officers, of the Preferred Guarantee Trustee in
good faith determine that the withholding of such notice is in the interests of
the Holders of the Preferred Securities.
(b) The Preferred Guarantee Trustee shall not be deemed to have
knowledge of any Event of Default except any Event of Default as to which the
Preferred Guarantee Trustee shall
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have received written notice or a Responsible Officer charged with the
administration of the Declaration shall have obtained written notice of.
Section 2.08. Conflicting Interests.
----------------------
The Declaration and the Indenture shall be deemed to be specifically
described in this Guarantee Agreement for the purposes of clause (i) of the
first proviso contained in (S)310(b) of the Trust Indenture Act. [Add all
subsequent Declarations.]
ARTICLE III.
POWERS, DUTIES AND RIGHTS OF PREFERRED GUARANTEE TRUSTEE
Section 3.01. Powers and Duties of Preferred Guarantee Trustee.
------------------------------------------------
(a) This Guarantee Agreement shall be held by the Preferred Guarantee
Trustee for the benefit of the Holders of the Preferred Securities, and the
Preferred Guarantee Trustee shall not transfer this Guarantee Agreement to any
Person except a Holder of Preferred Securities exercising his or her rights
pursuant to Section 5.04(b) or to a Successor Preferred Guarantee Trustee on
acceptance by such Successor Preferred Guarantee Trustee of its appointment to
act as Preferred Guarantee Trustee. The right, title and interest of the
Preferred Guarantee Trustee shall automatically vest in any Successor Preferred
Guarantee Trustee, and such vesting and cessation of title shall be effective
whether or not conveyancing documents have been executed and delivered pursuant
to the appointment of such Successor Preferred Guarantee Trustee.
(b) If an Event of Default has occurred and is continuing, the Preferred
Guarantee Trustee shall enforce this Guarantee Agreement for the benefit of the
Holders of the Preferred Securities.
(c) The Preferred Guarantee Trustee, before the occurrence of any Event of
Default and after the curing or waiver of all Events of Default that may have
occurred:
(i) shall undertake to perform only such duties as are specifically
set forth in this Guarantee Agreement and in the terms of the Preferred
Securities, and no implied covenants, duties or obligations shall be read
into this Guarantee Agreement against the Preferred Guarantee Trustee; and
(ii) in the absence of bad faith on the part of the Preferred
Guarantee Trustee, the Preferred Guarantee Trustee may conclusively rely,
as to the truth of the statements and the correctness of the opinions
expressed therein, upon any certificates or opinions furnished to the
Preferred Guarantee Trustee and conforming to the requirements of this
Guarantee Agreement; but in the case of any such certificates or opinions
that by any provision hereof are specifically required to be furnished to
the Preferred Guarantee Trustee, the Preferred Guarantee Trustee shall be
under a duty to examine the same to determine whether or not they conform
to the requirements of this Guarantee Agreement.
In case an Event of Default has occurred (that has not been cured or waived
pursuant to Section 2.06), the Preferred Guarantee Trustee shall exercise such
of the rights and powers vested in it by
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this Guarantee Agreement, and use the same degree of care and skill in their
exercise or use, as a prudent person would exercise or use under the
circumstances in the conduct of his or her own affairs.
(d) No provision of this Guarantee Agreement shall be construed to
relieve the Preferred Guarantee Trustee from liability for its own negligent
action, its own negligent failure to act, or its own willful misconduct, except
that:
(i) this subsection shall not be construed to limit subsection (c)
of this Section;
(ii) the Preferred Guarantee Trustee shall not be liable for any
error of judgment made in good faith by a Responsible Officer of the
Preferred Guarantee Trustee, unless it shall be proved that the Preferred
Guarantee Trustee was negligent in ascertaining the pertinent facts;
(iii) the Preferred Guarantee Trustee shall not be liable with
respect to any action taken or omitted to be taken by it in good faith in
accordance with the direction of the Holders of not less than a Majority in
liquidation amount of the Preferred Securities at the time outstanding
relating to the time, method and place of conducting any proceeding for any
remedy available to the Preferred Guarantee Trustee, or exercising any
trust or power conferred upon the Preferred Guarantee Trustee under this
Guarantee Agreement including, without limitation, with respect to the
Preferred Securities; and
(iv) no provision of this Guarantee Agreement shall require the
Preferred Guarantee Trustee to expend or risk its own funds or otherwise
incur financial liability in the performance of any of its duties hereunder
or in the exercise of any of its rights or powers, if it shall have
reasonable ground for believing that the repayment of such funds or
adequate indemnity against such risk or liability is not reasonably assured
to it.
(e) Whether or not therein expressly so provided, every provision of this
Guarantee Agreement relating to the conduct or affecting the liability of or
affording protection to the Preferred Guarantee Trustee shall be subject to the
provisions of this Section.
Section 3.02. Certain Rights of Preferred Guarantee Trustee.
----------------------------------------------
(a) Subject to the provisions of Section 3.01:
(i) the Preferred Guarantee Trustee may rely and shall be protected
in acting or refraining from acting upon any resolution, certificate,
statement, instrument, opinion, report, notice, request, direction,
consent, order, bond, debenture, note or other paper or document believed
by it to be genuine and to have been signed or presented by the proper
party or parties;
(ii) any act of the Guarantor contemplated by this Guarantee
Agreement shall be sufficiently evidenced by an Officers' Certificate;
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(iii) whenever, in the administration of this Guarantee Agreement,
the Preferred Guarantee Trustee shall deem it desirable that a matter be
proved or established before taking, suffering or omitting any action
hereunder, the Preferred Guarantee Trustee (unless other evidence is herein
specifically prescribed) may, in the absence of bad faith on its part, rely
upon an Officers' Certificate which, upon receipt of such request, shall be
promptly delivered by the Guarantor;
(iv) the Preferred Guarantee Trustee shall have no duty to see to
any recording, filing or registration of any instrument (or any recording,
refiling or registration thereof);
(v) the Preferred Guarantee Trustee may consult with counsel of
its selection and the written advice or opinion of such counsel with
respect to legal matters shall be full and complete authorization and
protection in respect of any action taken, suffered or omitted by it
hereunder in good faith and in reliance thereon. Such counsel may be
counsel to the Guarantor or any of its Affiliates, and may include any of
its employees;
(vi) the Preferred Guarantee Trustee shall be under no obligation
to exercise any of the rights or powers vested in it by this Guarantee
Agreement at the request or direction of any Holder, unless such Holder
shall have offered to the Preferred Guarantee Trustee reasonable security
or indemnity against the costs, expenses and liabilities that might be
incurred by it in complying with such request or direction;
(vii) the Preferred Guarantee Trustee shall not be bound to make
any investigation into the facts or matters stated in any resolution,
certificate, statement, instrument, opinion, report, notice, request,
direction, consent, order, bond, debenture, note or other paper or
document, but the Preferred Guarantee Trustee, in its discretion, may make
such further inquiry or investigation into such facts or matters as it may
see fit and, if the Preferred Guarantee Trustee shall determine to make
such further inquiry or investigation, it shall be entitled to examine the
books, records and premises of the Guarantor, personally or by agent or
attorney;
(viii) the Preferred Guarantee Trustee may execute any of the
trusts or powers hereunder or perform any duties hereunder either directly
or by or through agents or attorneys and the Preferred Guarantee Trustee
shall not be responsible for any misconduct or negligence on the part of
any agent or attorney appointed with due care by it hereunder;
(ix) any action taken by the Preferred Guarantee Trustee or its
agents hereunder shall bind the Trust and the Holders of the Preferred
Securities and the signature of the Preferred Guarantee Trustee or its
agents alone shall be sufficient and effective to perform any such action;
and no third party shall be required to inquire as to the authority of the
Preferred Guarantee Trustee to so act, or as to its compliance with any of
the terms and provisions of this Guarantee Agreement, both of which shall
be conclusively evidenced by the Preferred Guarantee Trustee's or its
agent's taking such action;
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(x) whenever in the administration of this Guarantee Agreement
the Preferred Guarantee Trustee shall deem it desirable to receive
instructions with respect to enforcing any remedy or right or taking any
other action hereunder, the Preferred Guarantee Trustee (i) may request
instructions from the Holders of the Preferred Securities which
instructions may only be given by the Holders of the same proportion in
liquidation amount of the Preferred Securities as would be entitled to
direct the Preferred Guarantee Trustee under the terms of the Preferred
Securities in respect of such remedy, right or action, (ii) may refrain
from enforcing such remedy or right or taking such other action until such
instructions are received, and (iii) shall be protected in acting in
accordance with such instructions;
(xi) the Preferred Guarantee Trustee may execute any of the
trusts or powers hereunder or perform any duties hereunder either directly
or by or through agents or attorneys and the Preferred Guarantee Trustee
shall not be responsible for any misconduct or negligence on the part of
any agent or attorney appointed with due care by it hereunder; and
(xii) the Preferred Guarantee Trustee shall not be liable for any
action taken or omitted by it in good faith and believed by it to be
authorized or within the discretion or rights or powers conferred upon it
by this Guarantee.
(b) No provision of this Guarantee Agreement shall be deemed to empower
the Preferred Guarantee Trustee to vary the investment of any Holder of the
Preferred Securities or to act in a manner inconsistent with the status of the
Issuer as a grantor trust for United States federal income tax purposes.
Section 3.03. Not Responsible for Recitals or Issuance of Guarantee.
------------------------------------------------------
The recitals contained in this Guarantee Agreement shall be taken as the
statements of the Guarantor, and the Preferred Guarantee Trustee does not assume
any responsibility for their correctness. The Preferred Guarantee Trustee makes
no representations as to the validity or sufficiency of this Guarantee
Agreement.
ARTICLE IV.
PREFERRED GUARANTEE TRUSTEE
Section 4.01. Preferred Guarantee Trustee; Eligibility.
-----------------------------------------
(a) There shall at all times be a Preferred Guarantee Trustee which shall:
(i) not be an Affiliate of the Guarantor; and
(ii) be a corporation organized and doing business under the laws of
the United States of America or any State thereof or of the District of
Columbia, or a corporation or Person permitted by the Securities and
Exchange Commission to act as an institutional trustee under the Trust
Indenture Act, authorized under such laws to exercise
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corporate trust powers, having a combined capital and surplus of at least
50 million U.S. dollars ($50,000,000), and subject to supervision or
examination by Federal, State or District of Columbia authority. If such
corporation publishes reports of condition at least annually, pursuant to
law or to the requirements of the supervising or examining authority
referred to above, then for the purposes of this Section 4.01(a)(ii), the
combined capital and surplus of such corporation shall be deemed to be its
combined capital and surplus as set forth in its most recent report of
condition so published;
(b) if at any time the Preferred Guarantee Trustee shall cease to be
eligible to so act under Section 4.01(a), the Preferred Guarantee Trustee shall
immediately resign in the manner and with the effect set out in Section 4.02(c);
and
(c) if the Preferred Guarantee Trustee has or shall acquire any
"conflicting interest" within the meaning of (S) 310(b) of the Trust Indenture
Act, the Preferred Guarantee Trustee and Guarantor shall in all respects comply
with the provisions of (S) 310(b) of the Trust Indenture Act.
Section 4.02. Appointment, Removal and Resignation of Preferred Guarantee
-----------------------------------------------------------
Trustee.
-------
(a) Subject to Section 4.02(b), the Preferred Guarantee Trustee may be
appointed or removed without cause at any time by the Guarantor;
(b) the Preferred Guarantee Trustee shall not be removed in accordance
with Section 4.02(a) until a Successor Preferred Guarantee Trustee has been
appointed and has accepted such appointment by written instrument executed by
such Successor Preferred Guarantee Trustee and delivered to the Guarantor;
(c) the Preferred Guarantee Trustee appointed to office shall hold office
until a Successor Preferred Guarantee Trustee shall have been appointed or until
its removal or resignation. The Preferred Guarantee Trustee may resign from
office (without need for prior or subsequent accounting) by an instrument in
writing executed by the Preferred Guarantee Trustee and delivered to the
Guarantor, which resignation shall not take effect until a Successor Preferred
Guarantee Trustee has been appointed and has accepted such appointment by
instrument in writing executed by such Successor Preferred Guarantee Trustee and
delivered to the Guarantor and the resigning Preferred Guarantee Trustee; and
(d) if no Successor Preferred Guarantee Trustee shall have been appointed
and accepted appointment as provided in this Section 4.02 within 60 days after
delivery to the Guarantor of an instrument of resignation, the resigning
Preferred Guarantee Trustee may petition any court of competent jurisdiction for
appointment of a Successor Preferred Guarantee Trustee. Such court may thereupon
after such notice, if any, as it may deem proper and prescribe, appoint a
Successor Preferred Guarantee Trustee.
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ARTICLE V.
GUARANTEE
Section 5.01. Guarantee.
----------
The Guarantor irrevocably and unconditionally agrees to pay in full to the
Holders the Guarantee Payments (without duplication of amounts theretofore paid
by the Issuer), as and when due, regardless of any defense, right of set-off or
counterclaim which the Issuer may have or assert. The Guarantor's obligation to
make a Guarantee Payment may be satisfied by direct payment of the required
amounts by the Guarantor to the Holders or by causing the Issuer to pay such
amounts to the Holders.
Section 5.02. Waiver of Notice and Demand.
----------------------------
The Guarantor hereby waives notice of acceptance of this Guarantee
Agreement and of any liability to which it applies or may apply, presentment,
demand for payment, any right to require a proceeding first against the Issuer
or any other Person before proceeding against the Guarantor, protest, notice of
nonpayment, notice of dishonor, notice of redemption and all other notices and
demands.
Section 5.03. Obligations Not Affected.
-------------------------
The obligations, covenants, agreements and duties of the Guarantor under
this Guarantee Agreement shall in no way be affected or impaired by reason of
the happening from time to time of any of the following:
(a) the release or waiver, by operation of law or otherwise, of the
performance or observance by the Issuer of any express or implied agreement,
covenant, term or condition relating to the Preferred Securities to be performed
or observed by the Issuer;
(b) the extension of time for the payment by the Issuer of all or any
portion of the Distributions, Redemption Price, Liquidation Distribution or any
other sums payable under the terms of the Preferred Securities or the extension
of time for the performance of any other obligation under, arising out of, or in
connection with, the Preferred Securities (other than an extension of time for
payment of Distributions, Redemption Price, Liquidation Distribution or other
sum payable that results from the extension of any interest payment period on
the Subordinated Notes or any extension of the maturity date of the Subordinated
Notes permitted by the Indenture);
(c) any failure, omission, delay or lack of diligence on the part of the
Holders to enforce, assert or exercise any right, privilege, power or remedy
conferred on the Holders pursuant to the terms of the Preferred Securities, or
any action on the part of the Issuer granting indulgence or extension of any
kind;
(d) the voluntary or involuntary liquidation, dissolution, sale of any
collateral, receivership, insolvency, bankruptcy, assignment for the benefit of
creditors, reorganization, arrangement, composition or readjustment of debt of,
or other similar proceedings affecting, the Issuer or any of the assets of the
Issuer;
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(e) any invalidity of, or defect or deficiency in the Preferred
Securities or the Subordinated Notes;
(f) the settlement or compromise of any obligation guaranteed hereby or
hereby incurred; or
(g) any other circumstance whatsoever that might otherwise constitute a
legal or equitable discharge or defense of a guarantor, it being the intent of
this Section 5.03 that the obligations of the Guarantor hereunder shall be
absolute and unconditional under any and all circumstances.
There shall be no obligation on the Holders or any other Person to give
notice to, or obtain consent of, the Guarantor with respect to the happening of
any of the foregoing.
Section 5.04. Rights of Holders.
------------------
(a) The Holders of a Majority in liquidation amount of the Preferred
Securities have the right to direct the time, method and place of conducting any
proceeding for any remedy available to the Preferred Guarantee Trustee in
respect of this Guarantee Agreement or exercising any trust or power conferred
upon the Preferred Guarantee Trustee under this Guarantee Agreement; and
(b) notwithstanding the rights of the Preferred Guarantee Trustee to
enforce this Guarantee Agreement under Article III, any Holder of Preferred
Securities may institute a legal proceeding directly against the Guarantor to
enforce the Preferred Guarantee Trustee's rights under this Guarantee Agreement,
without first instituting a legal proceeding against the Issuer, the Preferred
Guarantee Trustee or any other Person. Notwithstanding the foregoing, if the
Guarantor has failed to make a Guarantee Payment, a Holder of Preferred
Securities may directly institute a proceeding against the Guarantor for
enforcement of this Guarantee Agreement for such payment. The Guarantor waives
any right or remedy to require that any action be brought first against the
Issuer or any other person or entity before proceeding directly against the
Guarantor.
Section 5.05. Guarantee of Payment.
---------------------
This Guarantee Agreement creates a guarantee of payment and not of
collection.
Section 5.06. Subrogation.
------------
The Guarantor shall be subrogated to all rights, if any, of the Holders of
Preferred Securities against the Issuer in respect of any amounts paid to such
Holders by the Guarantor under this Guarantee Agreement; provided, however, that
the Guarantor shall not (except to the extent required by mandatory provisions
of law) be entitled to enforce or exercise any rights which it may acquire by
way of subrogation or any indemnity, reimbursement or other agreement, in all
cases as a result of payment under this Guarantee Agreement, if, at the time of
any such payment, any amounts are due and unpaid under this Guarantee Agreement.
If any amount shall be paid to the Guarantor in violation of the preceding
sentence, the Guarantor agrees to hold such amount in trust for the Holders and
to pay over such amount to the Holders.
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Section 5.07. Independent Obligations.
------------------------
The Guarantor acknowledges that its obligations hereunder are independent
of the obligations of the Issuer with respect to the Preferred Securities and
that the Guarantor shall be liable as principal and as debtor hereunder to make
Guarantee Payments pursuant to the terms of this Guarantee Agreement
notwithstanding the occurrence of any event referred to in subsections (a)
through (g), inclusive, of Section 5.03 hereof.
ARTICLE VI.
LIMITATION OF TRANSACTIONS; RANKING
Section 6.01. Limitation of Transactions.
---------------------------
So long as any Preferred Securities remain outstanding, (a) the Guarantor
will not declare or pay any dividend on, or make any distributions with respect
to, or redeem, purchase, acquire or make a liquidation payment with respect to,
any of its capital stock, and (b) the Guarantor will not make any payment of
interest, principal or premium, if any, on or repay, repurchase or redeem any
debt securities (including guarantees) of the Guarantor which rank pari passu
with or junior to the Subordinated Notes, if at such time (i) there shall have
occurred any Event of Default or (ii) there shall have occurred any Event of
Default under the Declaration; provided, that, clause (a) above does not apply
to (i) any stock dividends paid by the Guarantor where the dividend stock is the
same as that on which the dividend is being paid, (ii) purchases or acquisitions
by the Guarantor of shares of its common stock in connection with the
satisfaction by the Guarantor or any of its subsidiaries of their respective
obligations under any benefit plans for directors, officers, agents or employees
of the Guarantor's dividend reinvestment or director, officer, agent or employee
stock purchase plans, (iii) a reclassification of the Guarantor's capital stock
or the exchange or conversion of one class or series of its capital stock for
another class or series of its capital stock, (iv) the purchase of fractional
interests in shares of the Guarantor's capital stock pursuant to the conversion
or exchange provisions of such capital stock or security being converted or
exchanged for capital stock, (v) dividends or distributions in shares of, or
options, warrants or rights to subscribe for or purchase shares of the
Guarantor's capital stock or (vi) any declaration by the Guarantor of a dividend
in connection with the implementation or extension of a stockholders' rights
plan, or the issuance of stock under any such plan (including any such existing
plan) in the future or the redemption or repurchase or any such rights pursuant
thereto.
Section 6.02. Ranking.
--------
This Guarantee Agreement will constitute an unsecured obligation of the
Guarantor and will rank (i) subordinate and junior in right of payment to all
other liabilities of the Guarantor, except for those liabilities made pari passu
or junior by their terms to any liabilities of the Guarantor under this
Guarantee Agreement, (ii) pari passu with the most senior preferred or
preference stock now or hereafter issued by the Guarantor and with any guarantee
now or hereafter entered into by the Guarantor in respect of any preferred or
preference stock of any Affiliate of the Guarantor, and (iii) senior to the
Guarantor's common stock[; provided, that, this
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Guarantee Agreement shall be pari passu with the guarantee issued by the
Guarantor in connection with [ ]].
ARTICLE VII.
TERMINATION
Section 7.01. Termination.
------------
This Guarantee Agreement shall terminate with respect to each Holder upon
the first to occur of the following: full payment of the Redemption Price of
all Preferred Securities, the distribution of the Subordinated Notes to the
Holders of all of the Preferred Securities or full payment of the amounts
payable in accordance with the Declaration upon dissolution of the Trust.
Notwithstanding the foregoing, this Guarantee Agreement will continue to be
effective or will be reinstated, as the case may be, if at any time any Holder
of Preferred Securities must restore payment of any sums paid under the
Preferred Securities or under this Preferred Securities Guarantee.
ARTICLE VIII.
INDEMNIFICATION
Section 8.01. Exculpation.
------------
(a) No Indemnified Person shall be liable, responsible or accountable in
damages or otherwise to the Guarantor or any Covered Person for any loss, damage
or claim incurred by reason of any act or omission performed or omitted by such
Indemnified Person in good faith in accordance with this Guarantee Agreement and
in a manner such Indemnified Person reasonably believed to be within the scope
of the authority conferred on such Indemnified Person by this Guarantee
Agreement or by law, except that an Indemnified Person shall be liable for any
such loss, damage or claim incurred by reason of such Indemnified Person's
negligence (or, in the case of the Preferred Guarantee Trustee, except as
otherwise set forth in Section 3.01) or willful misconduct with respect to such
acts or omissions.
(b) An Indemnified Person shall be fully protected in relying in good
faith upon the records of the Guarantor and upon such information, opinions,
reports or statements presented to the Guarantor by any Person as to matters the
Indemnified Person reasonably believes are within such other Person's
professional or expert competence and who has been selected with reasonable care
by or on behalf of the Guarantor, including information, opinions, reports or
statements as to the value and amount of the assets, liabilities, profits,
losses, or any other facts pertinent to the existence and amount of assets from
which Distributions to Holders of Preferred Securities might properly be paid.
Section 8.02. Indemnification.
----------------
(a) The Guarantor shall indemnify each Indemnified Person for, and hold
each Indemnified Person harmless against, any loss, liability or expense
incurred by such Indemnified Person by reason of any act or omission performed
or omitted by such Indemnified Person
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without negligence or bad faith (or, in the case of the Preferred Securities
Trustee, except as set forth in Section 3.01) in accordance with this Guarantee
Agreement and in a manner such Indemnified Person reasonably believed to be
within the scope of authority conferred on such Indemnified Person by this
Guarantee Agreement.
(b) Reasonable expenses (including reasonable legal fees and expenses)
incurred by an Indemnified Person in defending any claim, demand, action, suit
or proceeding shall, from time to time, be advanced by the Guarantor prior to
the final disposition of such claim, demand, action, suit or proceeding upon
receipt by the Guarantor of an undertaking by or on behalf of the Indemnified
Person to repay such amount if it shall be determined that the Indemnified
Person is not entitled to be indemnified as authorized in Section 8.02(a).
(c) The provisions of this Section 8.02 shall survive termination of this
Guarantee or the resignation or removal of the Preferred Guarantee Trustee.
ARTICLE IX.
MISCELLANEOUS
Section 9.01. Successors and Assigns.
-----------------------
All guarantees and agreements contained in this Guarantee Agreement shall
bind the successors, assigns, receivers, trustees and representatives of the
Guarantor and shall inure to the benefit of the Holders of the Preferred
Securities then outstanding.
Section 9.02. Amendments.
-----------
Except with respect to any changes which do not adversely affect the rights
of Holders (in which case no consent of Holders will be required), this
Guarantee Agreement may only be amended with the prior approval of the Holders
of at least a Majority in liquidation amount of the Preferred Securities. The
provisions of Section 12.2 of the Declaration with respect to meetings of
Holders apply to the giving of such approval.
Section 9.03. Notices.
--------
All notices provided for in this Guarantee Agreement shall be in writing,
duly signed by the party giving such notice, and shall be delivered, telecopied
or mailed by first class mail, postage prepaid, as follows:
(a) if given to the Preferred Guarantee Trustee at the Preferred Guarantee
Trustee's mailing address set forth below (or such other address as the
Preferred Guarantee Trustee may give notice of to the Holders of the Preferred
Securities):
The Bank of New York
000 Xxxxxxx Xxxxxx, 00X
Xxx Xxxx, Xxx Xxxx 00000
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(b) if given to the Guarantor, at the Guarantor's mailing address set
forth below (or such other address as the Guarantor may give notice of to the
Holders of the Preferred Securities):
Occidental Petroleum Corporation
00000 Xxxxxxxx Xxxxxxxxx
Xxx Xxxxxxx, XX 00000
Attn: General Counsel
(c) if given to any Holder of Preferred Securities, at the address set
forth on the books and records of the Issuer.
All such notices shall be deemed to have been given when received in
person, telecopied with receipt confirmed, or mailed except that if a notice or
other document is refused delivery or cannot be delivered because of a changed
address of which no notice was given, such notice or other document shall be
deemed to have been delivered on the date of such refusal or inability to
deliver.
Section 9.04. Benefit.
--------
This Guarantee Agreement is solely for the benefit of the Holders of the
Preferred Securities and subject to Section 3.01(a) is not separately
transferable from the Preferred Securities.
Section 9.05. Governing Law.
--------------
THIS GUARANTEE AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED AND INTERPRETED
IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK INCLUDING, WITHOUT
LIMITATION, SECTION 5-1401 OF THE NEW YORK GENERAL OBLIGATIONS LAW.
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THIS GUARANTEE AGREEMENT is executed as of the day and year first above
written.
OCCIDENTAL PETROLEUM CORPORATION
By:
-----------------------------
Name:
Title:
THE BANK OF NEW YORK
as Preferred Guarantee Trustee
By:
---------------------------
Name:
Title:
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