SC 13D 1 sc13d-20020822.txt SCHEDULE 13D SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 Schedule 13D Under the Securities Exchange Act of 1934 Lyondell Chemical Company ------------------------------------------------------------ (Name of Issuer) Common Stock ------------------------------------------------------------ (Title of Class of Securities) not applicable ------------------------------------------------------------ (CUSIP Number) Donald P. de Brier, Esq. Occidental Petroleum Corporation 10889 Wilshire Boulevard Los Angeles, California 90024 (310) 208-8800 ------------------------------------------------------------ (Name, Address and Telephone Number of Person Authorized to Receive Notices and Communications) August 22, 2002 ------------------------------------------------------------ (Date of Event Which Requires Filing of this Statement) If the filing person has previously filed a statement on Schedule 13G to report the acquisition which is the subject of this Schedule 13D, and is filing this schedule because of Rule 13d-l(e), 13d-1(f) or 13d-1(g), check the following box [ ] Page 1 of 13 Pages CUSIP No. not applicable -------------- (1) Names of reporting persons. Occidental Petroleum Corporation I.R.S. Identification Nos. of above persons (entities 95-4035997 only). (2) Check the appropriate box if a member of a group (a) (see instructions) (b) (3) SEC use only. (4) Source of funds (see instructions). OO (5) Check if disclosure of legal proceedings is required pursuant to Items 2(d) or 2(e). (6) Citizenship or place of organization. Delaware Number of shares beneficially owned by each reporting person with: (7) Sole voting power. 0 (8) Shared voting power. 39,000,000 (including 34,000,000 shares of Series B Common Stock and 5,000,000 shares of Lyondell regular common stock issuable upon exercise of a warrant) (9) Sole dispositive power. 0 (10) Shared dispositive power. 39,000,000 (including 34,000,000 shares of Series B Common Stock and 5,000,000 shares of Lyondell regular common stock issuable upon exercise of a warrant) (11) Aggregate amount beneficially owned by each 39,000,000 (including 34,000,000 reporting person shares of Series B Common Stock and 5,000,000 shares of Lyondell regular common stock issuable upon exercise of a warrant) (12) Check if the aggregate amount in Row (11) excludes certain shares (see instructions). (13) Percent of class represented by amount in Row 23.7% (11). (14) Type of reporting person (see instructions). CO
Page 2 of 13 Pages CUSIP No. not applicable -------------- (1) Names of reporting persons. Occidental Petroleum Investment Co. I.R.S. Identification Nos. of above persons (entities 95-2584267 only). (2) Check the appropriate box if a member of a group (a) (see instructions) (b) (3) SEC use only. (4) Source of funds (see instructions). OO (5) Check if disclosure of legal proceedings is required pursuant to Items 2(d) or 2(e). (6) Citizenship or place of organization. California Number of shares beneficially owned by each reporting person with: Number of shares beneficially owned by each reporting person with: (7) Sole voting power. 0 (8) Shared voting power. 39,000,000 (including 34,000,000 shares of Series B Common Stock and 5,000,000 shares of Lyondell regular common stock issuable upon exercise of a warrant) (9) Sole dispositive power. 0 (10) Shared dispositive power. 39,000,000 (including 34,000,000 shares of Series B Common Stock and 5,000,000 shares of Lyondell regular common stock issuable upon exercise of a warrant) (11) Aggregate amount beneficially owned by each 39,000,000 (including 34,000,000 reporting person shares of Series B Common Stock and 5,000,000 shares of Lyondell regular common stock issuable upon exercise of a warrant) (12) Check if the aggregate amount in Row (11) excludes certain shares (see instructions). (13) Percent of class represented by amount in Row 23.7% (11). (14) Type of reporting person (see instructions). CO
Page 3 of 13 Pages CUSIP No. not applicable -------------- (1) Names of reporting persons. Occidental Chemical Holding Corporation I.R.S. Identification Nos. of above persons (entities 95-2865897 only). (2) Check the appropriate box if a member of a group (a) (see instructions) (b) (3) SEC use only. (4) Source of funds (see instructions). OO (5) Check if disclosure of legal proceedings is required pursuant to Items 2(d) or 2(e). (6) Citizenship or place of organization. California Number of shares beneficially owned by each reporting person with: Number of shares beneficially owned by each reporting person with: (7) Sole voting power. 0 (8) Shared voting power. 39,000,000 (including 34,000,000 shares of Series B Common Stock and 5,000,000 shares of Lyondell regular common stock issuable upon exercise of a warrant) (9) Sole dispositive power. 0 (10) Shared dispositive power. 39,000,000 (including 34,000,000 shares of Series B Common Stock and 5,000,000 shares of Lyondell regular common stock issuable upon exercise of a warrant) (11) Aggregate amount beneficially owned by each 39,000,000 (including 34,000,000 reporting person shares of Series B Common Stock and 5,000,000 shares of Lyondell regular common stock issuable upon exercise of a warrant) (12) Check if the aggregate amount in Row (11) excludes certain shares (see instructions). (13) Percent of class represented by amount in Row 23.7% (11). (14) Type of reporting person (see instructions). CO
Page 4 of 13 Pages ITEM 1. SECURITY AND ISSUER. Title of class of equity security: Series B Common Stock Common Stock Issuer: Lyondell Chemical Company Address of principal executive offices: 1221 McKinney Street, Suite 700 Houston, Texas 77010 This Schedule relates to the Series B Common Stock of Lyondell and a warrant to acquire shares of the regular common stock of Lyondell. For reporting purposes, the Reporting Person has treated the Series B Common Stock of Lyondell as being part of the same class under Section 12 of the 1934 Act as the regular common stock of Lyondell. ITEM 2. IDENTITY AND BACKGROUND. Occidental Petroleum Corporation ("Occidental"): ------------------------------------------------ state of organization: Delaware principal business: engaged, through its subsidiaries and affiliates, in the production, development and marketing of natural resources and chemicals principal business address: 10889 Wilshire Boulevard Los Angeles, California 90024 Occidental Petroleum Investment Co. ("OPIC"): --------------------------------------------- state of organization: California principal business: holding company principal business address: 10889 Wilshire Boulevard Los Angeles, California 90024 Occidental Chemical Holding Corporation ("OCHC"): ------------------------------------------------- state of organization: California principal business: holding company principal business address: 10889 Wilshire Boulevard Los Angeles, California 90024 Page 5 of 13 Pages The name, business address and current principal occupation or employment of each of the executive officers and directors of Occidental, OPIC and OCHC (collectively, the "Companies") are set forth below. Unless otherwise indicated, the business address of each such person is 10889 Wilshire Boulevard, Los Angeles, California 90024. All such persons listed below are citizens of the United States except Mr. Syriani, who is a citizen of Lebanon; Dr. Segovia, who is a citizen of Colombia; and Mr. Feick, who is a citizen of Canada. Unless otherwise indicated, each occupation set forth opposite an individual's name refers to employment with Occidental. Directors of Occidental are identified by an asterisk (*). Name and Business Address Present Principal Occupation or Employment ------------------------- ------------------------------------------ Ray R. Irani* Chairman of the Board and Chief Executive Officer of Occidental John W. Alden (1) Assistant Treasurer and Assistant Secretary of Occidental; Vice President and Secretary of OPIC Ronald W. Burkle* Managing Partner and majority owner of The 9130 West Sunset Boulevard Yucaipa Companies Los Angeles, California 90069 John S. Chalsty* Senior Advisor, Credit Suisse First Boston 11 Madison Avenue New York, New York 10010 Stephen I. Chazen Chief Financial Officer and Executive Vice President - Corporate Development of Occidental Donald P. de Brier Executive Vice President, Secretary and General Counsel of Occidental Edward P. Djerejian* Director, James A. Baker III Institute for Rice University, MS-40 Public Policy 6100 Main Street Houston, Texas 77005-1892 S. P. Dominick, Jr. (2) Vice President and Controller of Occidental; Vice President and Controller of OPIC John E. Feick* President and Chief Executive Officer of 230, 319-2nd Avenue, SW Matrix Solutions, Inc. Calgary, Alberta, Canada T2P OC5 Richard W. Hallock Executive Vice President - Human Resources of Occidental Page 6 of 13 Pages Name and Business Address Present Principal Occupation or Employment ------------------------- ------------------------------------------ J. R. Havert (2) Vice President and Treasurer of Occidental; Vice President and Treasurer of OPIC; Vice President and Treasurer of OCHC R. P. Heinkel Vice President of OCHC 5005 LBJ Freeway Dallas, Texas 75244 J. Roger Hirl Executive Vice President of Occidental 5005 LBJ Freeway Dallas, Texas 75244 Kenneth J. Huffman Vice President - Investor Relations of Occidental Scott A. King (2) Vice President and General Counsel of OCHC 5005 LBJ Freeway Dallas, Texas 75244 Dale R. Laurance* President of Occidental Anthony R. Leach Vice President - Finance of Occidental; President of OPIC; Executive Vice President of OCHC Jim A. Leonard (1) Senior Assistant Controller of Occidental Richard A. Lorraine Executive Vice President and Chief 5005 LBJ Freeway Financial Officer of OCHC Dallas, Texas 75244 Irvin W. Maloney* Retired Chairman and Chief Executive Officer, Dataproducts Corporation Robert M. McGee Vice President of Occidental Lawrence P. Meriage Vice President - Communications and Public Affairs of Occidental Donald L. Moore Vice President and Chief Information 5 East Greenway Plaza Officer of Occidental Houston, Texas 77046-0504 John W. Morgan Executive Vice President - Operations of Occidental; Vice President of OPIC Page 7 of 13 Pages Name and Business Address Present Principal Occupation or Employment ------------------------- ------------------------------------------ R. Casey Olson Vice President of Occidental 5 East Greenway Plaza Houston, Texas 77046-0504 Linda S. Peterson (1) Assistant Secretary of Occidental; Assistant Secretary of OPIC; Vice President and Assistant Secretary of OCHC Rodolfo Segovia* Member of Executive Committee of Carrera 9A No. 99-02 OF. 1001 Inversiones Sanford Santafe de Bogota, D.C. Colombia Richard A. Swan Vice President - Health, Environment and Safety of Occidental Aziz D. Syriani* President and Chief Operating Officer of 505 Park Avenue - 11th Floor The Olayan Group New York, New York 10022 Rosemary Tomich* Owner of the Hope Cattle Company and the A.S. Tomich Construction Company; Chairman of the Board of Directors and Chief Executive Officer, Livestock Clearing, Inc. Aurmond A. Watkins, Jr. Vice President - Tax of Occidental; Vice President of OCHC Walter L. Weisman* Past Chairman and Chief Executive Officer P.O. Box 18017 of American Medical International, Inc. Beverly Hills, California 90209 --------------------- (1) Director of OPIC (2) Director of OCHC During the last five years, none of the Companies or the natural persons named above (a) has been convicted in a criminal proceeding (excluding traffic violations or similar misdemeanors) or (b) was a party to a civil proceeding of a judicial or administrative body of competent jurisdiction and as a result of such proceeding was or is subject to a judgment, decree or final order enjoining future violations of, or prohibiting or mandating activities subject to, federal or state securities laws or finding any violation with respect to such laws. Page 8 of 13 Pages ITEM 3. SOURCE AND AMOUNT OF FUNDS OR OTHER CONSIDERATION. Occidental paid Lyondell $440 million pursuant to a Securities Purchase Agreement, dated as of July 8, 2002, between Lyondell and OCHC (the "Securities Purchase Agreement").1 ITEM 4. PURPOSE OF TRANSACTION. Directly and through OPIC and OCHC, Occidental currently holds its Lyondell shares for investment purposes only with a view toward maximizing long-term shareholder value for Occidental's shareholders and not for the purpose of controlling Lyondell. Other than as set forth above or in Item 6 of this Schedule 13D, Occidental currently has no plans that relate to, or would result in, any of the actions listed in clauses (a) through (j) of Item 4 of Schedule 13D. However, Occidental continuously reviews and analyzes its investments in each of its subsidiaries and other operations, including the Lyondell shares, in order to determine whether value for Occidental's shareholders is best served by holding those investments, increasing, disposing of, or monetizing those investments, or recapitalizing or otherwise restructuring those investments. With respect to the Lyondell shares, these reviews and analyses depend on a variety of factors, including without limitation, the price of, and other market conditions relating to, the Lyondell shares, the investment return on the Lyondell shares, Lyondell's business and prospects, other investment and business opportunities available to Occidental, general stock market and economic conditions, tax considerations, and other factors deemed relevant. ITEM 5. INTEREST IN SECURITIES OF THE ISSUER. (a) Occidental: aggregate number of shares held: 39,000,000* ----------- percentage of class: 23.7% OPIC: aggregate number of shares held: 39,000,000* ----- percentage of class: 23.7% OCHC: aggregate number of shares held: 39,000,000* ----- percentage of class: 23.7%
None of the directors or executive officers listed in Item 2 above is the beneficial owner of Lyondell common stock. --------------------- 1 The $440 million came from general corporate funds received when Occidental sold to Lyondell three of its affiliates, which own a 29.5% interest in Equistar Chemicals, LP. * This number includes 34,000,000 shares of Series B Common Stock and 5,000,000 shares of regular common stock issuable upon exercise of the Warrant for the Purchase of Shares of Common Stock, issued August 22, 2002 (the "Warrant"). Page 9 of 13 Pages (b) Occidental: sole power to vote or direct the vote: 0 ----------- shared power to vote or direct the vote: 39,000,000* sole power to dispose or direct the disposition: 0 shared power to dispose or direct the disposition: 39,000,000* OPIC: sole power to vote or direct the vote: 0 ----- shared power to vote or direct the vote: 39,000,000* sole power to dispose or direct the disposition: 0 shared power to dispose or direct the disposition: 39,000,000* OCHC: sole power to vote or direct the vote: 0 ----- shared power to vote or direct the vote: 39,000,000* sole power to dispose or direct the disposition: 0 shared power to dispose or direct the disposition: 39,000,000*
None of the directors or executive officers listed in Item 2 above is the beneficial owner of Lyondell common stock. (c) On August 22, 2002, pursuant to the Securities Purchase Agreement, Occidental acquired 34,000,000 shares of Series B Common Stock of Lyondell for $440,000,000. (d) Not applicable. (e) Not applicable. ITEM 6. CONTRACTS, ARRANGEMENTS, UNDERSTANDINGS OR RELATIONSHIPS WITH RESPECT TO SECURITIES OF THE ISSUER. Pursuant to the Securities Purchase Agreement, OCHC purchased from Lyondell a total of 34,000,000 shares of Lyondell's newly created Series B common stock. Pursuant to a Warrant, issued August 22, 2002 (the "Warrant"), OCHC also received warrants to purchase an additional 5 million shares (the "Warrant Shares") of Lyondell's regular common stock for $25 per share. In exchange for the Lyondell securities, Occidental paid $440,000,000 in cash. As additional consideration for the transaction, Occidental will receive from Lyondell a contingent payment equal to 7.38% of cash distributions from Equistar for 2002 and 2003 up to a total of $35 million, to be paid either in cash or in Lyondell common stock. Pursuant to a Stockholders Agreement, dated as of August 22, 2002 (the "Stockholders Agreement"), Lyondell has appointed to its board of directors two of Occidental's executive officers, Dr. Ray R. Irani (who also is an Occidental director) and Mr. Stephen I. Chazen. Unless Occidental obtains Lyondell's consent, the Stockholders Agreement prevents Occidental (a) from selling its Series B common stock or the Warrant Shares and (b) from converting its --------------------- * This number includes 34,000,000 shares of Series B Common Stock and 5,000,000 shares of regular common stock issuable upon exercise of the Warrant. Page 10 of 13 Pages Series B common stock into regular Lyondell common stock for at least two years. In addition, the Stockholders Agreement generally requires Occidental to vote its Lyondell common stock in favor of the slate of directors proposed by Lyondell's management. The Stockholders Agreement will be effective as long as Occidental owns 17 million or more shares of Lyondell common stock. ITEM 7. MATERIAL TO BE FILED AS EXHIBITS. Exhibit 1 Agreement Pursuant to Rule 13d-1(k) Exhibit 2 Securities Purchase Agreement, dated as of July 8, 2002, by and between Lyondell Chemical Company and Occidental Chemical Holding Corporation Exhibit 3 Warrant for the Purchase of Shares of Common Stock, issued August 22, 2002 Exhibit 4 Stockholders Agreement, dated as of August 22, 2002, by and among Lyondell Chemical Company and the Stockholders as defined therein Page 11 of 13 Pages SIGNATURE After reasonable inquiry and to the best of my knowledge and belief, I certify that the information set forth in this statement is true, complete and correct. September 3, 2002 OCCIDENTAL PETROLEUM CORPORATION By: /s/ J. R. HAVERT -------------------------------------------- Name: J. R. Havert Title: Vice President and Treasurer OCCIDENTAL PETROLEUM INVESTMENT CO. By: /s/ J. R. HAVERT -------------------------------------------- Name: J. R. Havert Title: Vice President and Treasurer OCCIDENTAL CHEMICAL HOLDING CORPORATION By: /s/ J. R. HAVERT -------------------------------------------- Name: J. R. Havert Title: Vice President and Treasurer Page 12 of 13 Pages