UNITED
STATES
SECURITIES
AND
EXCHANGE
COMMISSION
Washington,
D.C.
20549
FORM
8-K
CURRENT
REPORT
Pursuant
to
Section
13
OR
15(d)
of
The
Securities
Exchange
Act
of
1934
Date
of
Report
(Date
of
earliest
event
reported):
December
8,
2015
FREEPORT-McMoRan
INC.
(Exact
name
of
registrant
as
specified
in
its
charter)
Delaware
(State
or
other
jurisdiction
of
incorporation)
001-11307-01
(Commission
File
Number)
333
North
Central
Avenue
Phoenix,
AZ
74-2480931
(IRS
Employer
Identification
No.)
(Address
of
principal
executive
offices)
85004-2189
(Zip
Code)
Registrant’s
telephone
number,
including
area
code:
(602)
366-8100
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following
provisions:
¨
Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
¨
Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
¨
Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
¨
Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))
Item 1.01 Entry into a Material Definitive Agreement .
Second
Amendment
to
Term
Loan
On December 9, 2015, Freeport-McMoRan Inc. (FCX) and Freeport-McMoRan Oil & Gas LLC (FM O&G), as borrowers, JPMorgan Chase Bank, N.A., as
administrative agent, Bank of America, N.A., as syndication agent and each of the lenders party thereto entered into the Second Amendment to Term Loan
Agreement dated as of December 9, 2015 (Second Amendment) to the Term Loan Agreement dated as of February 14, 2013, as amended by the First Amendment
to Term Loan Agreement dated as of February 27, 2015, among the borrowers, the administrative agent, the syndication agent, and each of the lenders party
thereto.
The changes made pursuant to the Second Amendment include modification of the maximum total leverage ratio to 5.50x for the quarter ending December 31,
2015, 5.90x for the quarters ending March 31, 2016 and June 30, 2016, 5.75x for the quarter ending September 30, 2016, 5.00x for the quarter ending
December 31, 2016, and 4.25x for 2017, reverting to 3.75x thereafter.
The Second Amendment also provides for certain changes to interest rate spreads. If and during such periods as the total leverage ratio as of the end of the fiscal
quarter (commencing with the fiscal quarter ending December 31, 2015) (1) exceeds 4.00 to 1.00 but is less than or equal to 4.50 to 1.00, the Applicable Rate (as
such term is defined in the Second Amendment) will be, for any day, a rate per annum 25 basis points in excess of the rate per annum otherwise applicable, and
(2) exceeds 4.50 to 1.00, the Applicable Rate (as such term is defined in the Second Amendment) will be, for any day, a rate per annum 50 basis points in excess of
the rate per annum otherwise applicable.
In addition, a mandatory prepayment provision was added which provides that if, as of the last day of any fiscal quarter, the total leverage ratio exceeds 4.00 to
1.00, 50% of the net proceeds from certain sale, transfer, lease or other dispositions of certain assets, subject to certain exceptions, must be applied to repay the
term loan (applied to the 2020 tranche and the 2018 tranche pro rata based on relative aggregate outstanding principal amounts thereof).
The Second Amendment provides for no other changes.
Third
Amendment
to
Revolving
Credit
Facility
On December 9, 2015, FCX, PT Freeport Indonesia, FM O&G, as borrowers, JPMorgan Chase Bank, N.A. as administrative agent, Bank of America, N.A., as
syndication agent and each of the lenders party thereto entered into the Third Amendment to Revolving Credit Agreement dated as of December 9, 2015 (Third
Amendment) to the Revolving Credit Agreement dated as of February 14, 2013, as amended by the First Amendment to Revolving Credit Agreement dated as of
May 30, 2014 and the Second Amendment to Revolving Credit Agreement dated as of February 27, 2015, among the borrowers, the administrative agent, the
syndication agent, and each of the lenders party thereto.
The changes made pursuant to the Third Amendment include modification of the maximum total leverage ratio and interest rate spreads consistent with the term
loan amendment described above. The Third Amendment provides for no other changes.
As of December 8, 2015, there were borrowings of $510 million and $36 million of letters of credit issued under the revolving credit facility, resulting in
availability of approximately $3.5 billion, of which approximately $1.5 billion could be used for additional letters of credit.
For additional information about the term loan and the revolving credit facility, refer to Note 8 to the consolidated financial statements in FCX’s Annual Report on
Form 10-K for the year ended December 31, 2014.
JPMorgan Chase Bank, N.A. and Bank of America, N.A. and their respective affiliates have in the past engaged, and may in the future engage, in transactions with
and perform services, including commercial banking, financial advisory and investment banking services, for FCX and its affiliates in the ordinary course of
business for which JPMorgan Chase Bank, N.A. and Bank of America, N.A. have received or will receive customary fees and expenses.
The foregoing summaries of the Second Amendment and the Third Amendment do not purport to be complete and are subject to, and qualified in their entirety by,
reference to the full text of the Second Amendment and the Third Amendment, which are filed as Exhibit 10.1 and 10.2, respectively, hereto and incorporated
herein by reference.
Item 2.03 Creation of a Direct Financial Obligation or an Obligation under an Off-Balance Sheet Arrangement of a Registrant .
The information in Item 1.01 of this Form 8-K is hereby incorporated by reference into this Item 2.03.
Item 5.03 Amendments to Articles of Incorporation or Bylaws; Change in Fiscal Year .
(a) As required under that certain Nomination and Standstill Agreement between Freeport-McMoRan Inc. (FCX), Carl C. Icahn, High River Limited Partnership,
Hopper Investments LLC, Barberry Corp., Icahn Partners Master Fund LP, Icahn Offshore LP, Icahn Partners LP, Icahn Onshore LP, Icahn Capital LP, IPH GP
LLC, Icahn Enterprises Holdings L.P., Icahn Enterprises G.P. Inc., Beckton Corp., Andrew Langham and Courtney Mather, on December 8, 2015, the Board of
Directors of FCX approved amendments to Articles X and XI of FCX’s Amended and Restated By-Laws to provide that stockholders may provide timely notice of
director nominations and other business to be presented at the company’s annual meeting no earlier than 90 days and no later than 60 days prior to the first
anniversary of the preceding year’s annual meeting of stockholders.
A copy of FCX’s Amended and Restated By-Laws, as amended effective December 8, 2015, is attached hereto as Exhibit 3.1 and is incorporated herein by
reference.
Item 8.01 Other Events .
Freeport-McMoRan Inc. issued a press release dated December 9, 2015, announcing additional actions in response to market conditions, including further revisions
to its oil and gas capital spending plans, additional curtailments in copper and molybdenum production and the suspension of its common stock dividend. A copy of
the press release is attached hereto as Exhibit 99.1 and is incorporated in this Item 8.01 by reference.
Item 9.01 Financial Statements and Exhibits .
(d) Exhibits.
The Exhibits included as part of this Current Report are listed in the attached Exhibit Index.
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned
hereunto duly authorized.
FREEPORT-McMoRan INC.
By: /s/ Kathleen L. Quirk
Kathleen L. Quirk
Executive Vice President, Chief Financial Officer
& Treasurer (authorized signatory and
Principal Financial Officer)
Date: December 9, 2015
Freeport-McMoRan Inc.
Exhibit Index
Exhibit
Number 3.1 Freeport-McMoRan Inc. Amended and Restated By-Laws, as amended effective December 8, 2015.
10.1
Second Amendment dated as of December 9, 2015 to the Term Loan Agreement dated as of February 14, 2013, as amended by the First Amendment
dated as of February 27, 2015, among Freeport-McMoRan Inc. and Freeport-McMoRan Oil & Gas LLC, as borrowers, JPMorgan Chase Bank, N.A.,
as administrative agent, Bank of America, N.A., as syndication agent, HSBC Bank USA, National Association, Mizuho Corporate Bank, Ltd.,
Sumitomo Mitsui Banking Corporation, The Bank of Nova Scotia and The Bank of Tokyo-Mitsubishi UFJ, Ltd., as co-documentation agents, and
each of the lenders party thereto.
Third Amendment dated as of December 9, 2015 to the Revolving Credit Agreement dated as of February 14, 2013, as amended by the First
Amendment dated as of May 30, 2014 and the Second Amendment dated as of February 27, 2015, among Freeport-McMoRan Inc., PT Freeport
Indonesia and Freeport-McMoRan Oil & Gas LLC, as borrowers, JPMorgan Chase Bank, N.A., as administrative agent and the swingline lender,
Bank of America, N.A., as syndication agent, BNP Paribas, Citibank, N.A., HSBC Bank USA, National Association, Mizuho Corporate Bank, Ltd.,
Sumitomo Mitsui Banking Corporation, The Bank of Nova Scotia and The Bank of Tokyo-Mitsubishi UFJ, Ltd., as co-documentation agents, and
each of the lenders and issuing banks party thereto.
Press Release dated December 9, 2015, titled “Freeport-McMoRan Announces Further Reduction in Capital Spending, Metals Production, &
Suspension of Common Stock Dividend.”
10.2
99.1
Exhibit
3.1
As amended through December 8, 2015
Freeport-McMoRan
Inc.
Amended
and
Restated
By-Laws
ARTICLE
I
Name
The name of the corporation is Freeport-McMoRan
Inc.
ARTICLE
II
Offices
1. The location of the registered office of the corporation in the State of Delaware is 2711 Centerville Road, Suite 400, in the City of Wilmington, County of
New Castle, and the name of its registered agent at such address is Corporation Service Company.
2. The corporation shall in addition to its registered office in the State of Delaware establish and maintain an office or offices at such place or places as the
Board of Directors may from time to time find necessary or desirable.
ARTICLE
III
Corporate
Seal
The corporate seal of the corporation shall have inscribed thereon the name of the corporation and the year of its creation (1987) and the words “Corporate
Seal Delaware”. Such seal may be used by causing it or a facsimile thereof to be impressed, affixed, printed or otherwise reproduced.
ARTICLE
IV
Meeting
of
Stockholders
1. Meetings of the stockholders shall be held at the registered office of the corporation in the State of Delaware, or at such other place as shall be determined,
from time to time, by the Board of Directors.
2. The annual meeting of stockholders shall be held on such day at such time as may be determined from time to time by resolution of the Board of Directors.
At each annual
meeting of the stockholders they shall elect by a majority of the votes cast, by written ballot, and subject to the voting powers set forth in the Certificate of
Incorporation, the successors of the directors whose term expires at such meeting, to hold office until the annual meeting of stockholders held in the year following
their election and until their successors are respectively elected and qualified or until their earlier resignation or removal, provided that if the number of nominees
exceeds the number of directors to be elected, the directors shall be elected by plurality vote. In an uncontested election, any nominee for director who has a
majority of votes cast “withheld” from his or her election shall promptly tender his or her resignation to the Board. The Nominating and Corporate Governance
Committee will consider the tendered resignation and recommend to the Board whether to accept or reject the resignation. The Board shall act on the Nominating
and Corporate Governance Committee’s recommendation and publicly disclose its decision within 90 days from the date of the annual meeting of stockholders.
Any director who tenders his or her resignation shall not participate in the Nominating and Corporate Governance Committee’s recommendation or the Board
action regarding whether to accept or reject the tendered resignation. If each member of the Nominating and Corporate Governance Committee fails to be elected at
the same election, the independent directors who were elected shall appoint a committee to consider the tendered resignations and recommend to the Board whether
to accept or reject them. Any vacancies in the Board resulting from the failed election of a director under this section may be filled by a majority of the directors
then in office, although less than a quorum, and each director so elected shall hold office until his or her successor has been elected and duly qualified. Any other
proper business may be transacted at the annual meeting.
3. The holders of a majority of the stock issued and outstanding and entitled to vote thereat, present in person or represented by proxy, shall constitute a
quorum at all meetings of the stockholders for the transaction of business except as otherwise provided by statute, by the Certificate of Incorporation or by these
By-Laws. If, however, such majority shall not be present or represented at any meeting of the stockholders, the stockholders entitled to vote thereat, present in
person or by proxy, shall have power to adjourn the meeting from time to time without notice other than announcement at the meeting (except as otherwise
provided by statute), until the requisite amount of voting stock shall be present. At such adjourned meeting at which the requisite amount of voting stock shall be
represented any business may be transacted which might have been transacted at the meeting as originally notified.
4. At all meetings of the stockholders, each stockholder having the right to vote shall be entitled to vote in person, or by proxy appointed by an instrument in
writing subscribed by such stockholder and bearing a date not more than six months prior to said meeting, unless such instrument provides for a longer period. All
proxies shall be filed with the secretary of the meeting before being voted.
5. At each meeting of the stockholders each stockholder shall have one vote for each share of stock having voting power, registered in his name on the books
of the corporation at the record date fixed in accordance with these By-Laws, or otherwise determined, with respect to such meeting. Except as otherwise expressly
provided by statute, by the Certificate of Incorporation or by these By-Laws, all matters coming before any meeting of the stockholders shall be decided by the vote
of a majority of the number of shares of stock present in person or represented by proxy at such meeting and entitled to vote thereat, a quorum being present.
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6. Notice of each meeting of the stockholders shall be given to each stockholder entitled to vote thereat not less than 10 nor more than 60 days before the
date of the meeting. Such notice shall state the place, date and hour of the meeting and, in the case of a special meeting, the purpose or purposes for which the
meeting is called.
7. Subject to such rights to call special meetings of stockholders under specified circumstances as may be granted to holders of any shares of Preferred Stock
of the corporation pursuant to the provisions of Section (c) of Article FOURTH of the Certificate of Incorporation, special meetings of the stockholders may be
called only by the Chairman of the Board, any Vice Chairman of the Board or the President of the corporation, or at the request in writing or by a vote of a majority
of the Board of Directors, and not by any other persons. Any request for a special meeting made by the Board of Directors shall state the purpose or purposes of the
proposed meeting.
8. Business transacted at each special meeting shall be confined to the purpose or purposes stated in the notice of such meeting.
9. The order of business at each meeting of the stockholders shall be determined by the chairman of such meeting.
10. At an annual meeting of the stockholders, only business shall be conducted as shall have been brought before the meeting (a) by or at the direction of the
Board of Directors or (b) by any stockholder of the corporation who complies with the notice procedures set forth in this Section 10. For business to be properly
brought before an annual meeting by a stockholder, the stockholder must have given timely notice thereof in writing to the Secretary of the corporation. To be
timely, a stockholder’s notice must be delivered to the Secretary at the principal executive offices of the corporation not later than the close of business on the 60th
day nor earlier than the close of business on the 90th day prior to the first anniversary of the preceding year’s annual meeting; provided, however, that in the event
that the date of the annual meeting is more than 30 days before or more than 90 days after such anniversary date, notice by the stockholder to be timely must be so
delivered not earlier than the close of business on the 90th day prior to such annual meeting and not later than the close of business on the later of the 60th day prior
to such annual meeting or the 10th day following the day on which public announcement of the date of such meeting is first made. In no event shall the public
announcement of an adjournment of an annual meeting commence a new time period for the giving of a stockholder’s notice as described above. A stockholder’s
notice to the Secretary shall set forth as to each matter the stockholder proposes to bring before the annual meeting (a) a brief description of the business desired to
be brought before the annual meeting and the reasons for conducting such business at the annual meeting, (b) the name and address, as they appear on the
corporation’s books, of the stockholder proposing such business, (c) the class and number of shares of the corporation which are beneficially owned by the
stockholder and (d) any material interest of the stockholder in such business. Notwithstanding anything in the By-Laws to the contrary, no business shall be
conducted at an annual meeting except in accordance with the
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procedures set forth in this Section 10. The chairman of an annual meeting shall, if the facts warrant, determine and declare to the meeting that business was not
properly brought before the meeting and in accordance with the provisions of the By-Laws, and if he should so determine, he shall so declare to the meeting and
any such business not properly brought before the meeting shall not be transacted. Notwithstanding the foregoing provisions of this Section 10, a stockholder
seeking to have a proposal included in the corporation’s proxy statement shall comply with the requirements of Regulation 14A under the Securities Exchange Act
of 1934, as amended (including, but not limited to, Rule 14a-8 or its successor provision).
11. Only persons who are nominated in accordance with the procedures set forth in the By-Laws shall be eligible for election as directors. Nominations of
persons for election to the Board of Directors of the corporation may be made at a meeting of stockholders (a) by or at the direction of the Board of Directors or
(b) by any stockholder of the corporation entitled to vote for the election of directors at the meeting who complies with the notice procedures set forth in this
Section 11. Such nominations, other than those made by or at the direction of the Board of Directors, shall be made pursuant to timely notice in writing to the
Secretary of the corporation. To be timely, a stockholder’s notice must be delivered to the Secretary at the principal executive offices of the corporation not later
than the close of business on the 60th day nor earlier than the close of business on the 90th day prior to the first anniversary of the preceding year’s annual meeting;
provided, however, that in the event that the date of the annual meeting is more than 30 days before or more than 90 days after such anniversary date, notice by the
stockholder to be timely must be so delivered not earlier than the close of business on the 90th day prior to such annual meeting and not later than the close of
business on the later of the 60th day prior to such annual meeting or the 10th day following the day on which public announcement of the date of such meeting is
first made. In no event shall the public announcement of an adjournment of an annual meeting commence a new time period for the giving of a stockholder’s notice
as described above. Such stockholder’s notice shall set forth (a) as to each person whom the stockholder proposes to nominate for election or reelection as a
director all information relating to such person that is required to be disclosed in solicitations of proxies for election of directors, or is otherwise required, in each
case pursuant to Regulation 14A under the Securities Exchange Act of 1934, as amended (including such person’s written consent to being named in the proxy
statement as a nominee and to serving as a director if elected); and (b) as to the stockholder giving the notice (i) the name and address, as they appear on the
corporation’s books, of such stockholder and (ii) the class and number of shares of the corporation which are beneficially owned by such stockholder. At the
request of the Board of Directors any person nominated by the Board of Directors for election as a director shall furnish to the Secretary of the corporation that
information required to be set forth in a stockholder’s notice of nomination which pertains to the nominee. No person shall be eligible for election as a director of
the corporation unless nominated in accordance with the procedures set forth in the By-Laws. The chairman of the meeting shall, if the facts warrant, determine and
declare to the meeting that a nomination was not made in accordance with the procedures prescribed by the By-Laws, and if he should so determine, he shall so
declare to the meeting and the defective nomination shall be disregarded.
12. Any action required or permitted to be taken at any annual or special meeting of stockholders may be taken without a meeting, without prior notice and
without a
-4-
vote, if a consent in writing, setting forth the action so taken, shall be signed by stockholders having not less than a minimum number of votes that would be
necessary to authorize or take such action at a meeting at which all shares entitled to vote thereon were present and voted. Prompt notice of the taking of the
corporate action without a meeting by less than unanimous written consent shall be given to those stockholders who have not consented in writing.
ARTICLE
V
Directors
1. The business and affairs of the corporation shall be managed by or under the direction of a Board of Directors which may exercise all such powers and
authority for and on behalf of the corporation as shall be permitted by law, the Certificate of Incorporation or these By-Laws.
2. The directors may hold their meetings and have one or more offices, and, subject to the laws of the State of Delaware, keep the stock ledger and other
books and records of the corporation outside of said State, at such place or places as they may from time to time determine.
3. Any director may resign at any time by giving written notice of his resignation to the Board of Directors, to the Chairman of the Board, any Vice
Chairman of the Board, the Chief Executive Officer or the President. Any such resignation shall take effect upon receipt thereof by the Board, the Chairman of the
Board, any Vice Chairman of the Board, the Chief Executive Officer or the President, as the case may be, or at such later date as may be specified therein. Any
such notice to the Board shall be addressed to it in care of the Secretary.
ARTICLE
VI
Committees
of
Directors
1. By resolutions adopted by a majority of the whole Board of Directors, the Board may designate an Executive Committee, an Audit Committee, a
Compensation Committee, a Nominating and Corporate Governance Committee and a Corporate Responsibility Committee, and may designate one or more other
committees, each such committee to consist of one or more directors of the corporation. The Executive Committee shall have and may exercise all the powers of
the Board in the management of the business and affairs of the corporation (except as otherwise expressly limited by statute), including the power and authority to
declare dividends and to authorize the issuance of stock, and may authorize the seal of the corporation to be affixed to all papers which may require it. The Audit
Committee, the Compensation Committee, the Nominating and Corporate Governance Committee, the Corporate Responsibility Committee and each such other
committee shall have such of the powers and authority of the Board as may be provided from time to time in resolutions adopted by a majority of the whole Board.
Each committee shall report its proceedings to the Board when required.
-5-
2. The requirements with respect to the manner in which the Executive Committee and each such other committee shall hold meetings and take actions shall
be set forth in the resolutions of the Board of Directors designating the Executive Committee or such other committee and in the charters of such committees as
adopted by the Board of Directors.
ARTICLE
VII
Compensation
of
Directors
The directors shall receive such compensation for their services as may be authorized by resolution of the Board of Directors, which compensation may
include an annual fee and a fixed sum and expenses for attendance at regular or special meetings of the Board or any committee thereof. Nothing herein contained
shall be construed to preclude any director from serving the corporation in any other capacity and receiving compensation therefor.
ARTICLE
VIII
Meetings
of
Directors;
Action
Without
a
Meeting
1. Regular meetings of the Board of Directors may be held without notice at such time and place, either within or without the State of Delaware, as may be
determined from time to time by resolution of the Board.
2. Special meetings of the Board of Directors may be called by the Chairman of the Board, by any Vice Chairman of the Board, by the Chief Executive
Officer or by the President on at least 24 hours’ notice to each director, and shall be called by the Chief Executive Officer, the President or the Secretary on like
notice on the request in writing of any director. Except as may be otherwise specifically provided by statute, by the Certificate of Incorporation or by these ByLaws, the purpose or purposes of any such special meeting need not be stated in such notice.
3. At all meetings of the Board of Directors the presence in person of a majority of the total number of directors shall be necessary and sufficient to constitute
a quorum for the transaction of business and, except as may be otherwise specifically provided by statute, by the Certificate of Incorporation or by these By-Laws,
if a quorum shall be present, the act of a majority of the directors present at any meeting shall be the act of the Board.
4. Any action required or permitted to be taken at any meeting of the Board of Directors or any committee thereof may be taken without a meeting if all the
members of the Board or such committee, as the case may be, consent thereto in writing and the writing or writings are filed with the minutes of proceedings of the
Board or committee. Any director may participate in a meeting of the Board, or of any committee designated by the Board, by means of a conference telephone or
similar communications equipment by means of which all persons participating in the meeting can hear each other, and participation in a meeting pursuant to this
sentence shall constitute presence in person at such meeting.
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ARTICLE
IX
Advisory
Directors
The Board of Directors may, from time to time as it deems appropriate by resolution adopted by a majority of the entire Board, appoint individuals as
Advisory Directors. Each Advisory Director shall serve in such capacity at the pleasure of the Board of Directors. It shall be the duty of Advisory Directors to
advise and provide general policy advice to the Board of Directors at such times and places and in such groups and committees as may be determined from time to
time by the Board of Directors. Each Advisory Director shall, upon the invitation of the Board of Directors, have the privilege to receive notice of and to attend
regular meetings of the Board of Directors or any committee of the Board for which such Advisory Director has been appointed to serve as an advisor or consultant,
and may participate in all discussions occurring during such meetings in an advisory capacity. Advisory Directors shall not be entitled to vote on any matter
brought before the Board of Directors or any committee thereof and shall not be counted for the purpose of determining whether a quorum of the Board of
Directors (or any committee thereof) is present. No Advisory Director shall be deemed to be a Director of the corporation for any purposes whatsoever under any
applicable law or under these by-laws. The compensation paid to Advisory Directors shall be determined from time to time by the Board of Directors.
ARTICLE
X
Officers
1. The officers of the corporation shall be chosen by the Board of Directors and shall be a Chairman of the Board, up to two executive Vice Chairmen, a
Chief Executive Officer, a Chief Executive Officer of the Oil and Gas business of the corporation, a President, one or more Vice Presidents, a Secretary and a
Treasurer. The Board of Directors may also choose a non-executive Vice Chairman of the Board, one or more Executive Vice Presidents, one or more Senior Vice
Presidents, a General Counsel, one or more Assistant Vice Presidents, a Controller and one or more Assistant Secretaries, Assistant Treasurers or Assistant
Controllers, and such other officers as it shall deem necessary who shall hold their offices for such terms and shall exercise such powers and perform such duties as
shall be prescribed from time to time by the Board or by the Chairman of the Board. Any number of offices may be held by the same person.
2. Annually, the Board of Directors shall choose a Chairman of the Board from among the directors, and shall choose the remaining officers who need not be
members of the Board except in the event they choose one or more executive Vice Chairmen of the Board.
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3. The salaries of all officers of the corporation shall be fixed by the Board of Directors, or in such manner as the Board may prescribe.
4. The officers of the corporation shall hold office until their successors are respectively chosen and qualified, except that any officer may at any time resign
or be removed by the Board of Directors. If the office of any officer becomes vacant for any reason, the vacancy may be filled by the Board.
5. Any officer may resign at any time by giving written notice of his resignation to the Board of Directors, the Chairman of the Board, any Vice Chairman of
the Board, the Chief Executive Officer or the President. Any such resignation shall take effect upon receipt thereof by the Board, the Chairman of the Board, any
Vice Chairman of the Board, the Chief Executive Officer or the President, as the case may be, or at such later date as may be specified therein. Any such notice to
the Board shall be addressed to it in care of the Secretary.
ARTICLE
XI
Chairman
of
the
Board;
Office
of
the
Chairman
The Chairman of the Board shall have the responsibility for the management of the affairs of the Board of Directors and shall preside at meetings of the
stockholders and of the Board of Directors. Subject to the supervision and direction of the Board of Directors, he shall be responsible for managing the affairs of
the corporation. He shall have general supervision and direction of all of the other officers of the corporation and shall have powers and duties usually and
customarily associated with the office of Chairman of the Board. There shall be an Office of the Chairman, consisting of the Chairman of the Board, any executive
Vice Chairmen, the Chief Executive Officer and the Chief Executive Officer of the Oil and Gas business of the corporation. The Chairman of the Board, in
conjunction with the executive Vice Chairmen of the Board, shall develop and execute the business and financial strategy of the corporation which shall be
presented to and authorized by the Board of Directors.
ARTICLE
XII
Executive
Vice
Chairmen
of
the
Board
The corporation may appoint up to two executive Vice Chairman of the Board. An executive Vice Chairman of the Board shall preside at meetings of the
stockholders and of the Board of Directors at which the Chairman of the Board is not present. The executive Vice Chairmen of the Board shall have such duties and
responsibilities as may be determined by the Chairman of the Board.
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ARTICLE
XIII
Chief
Executive
Officer
In the absence of the Chairman of the Board and the executive Vice Chairmen of the Board, the Chief Executive Officer shall preside at all meetings of the
shareholders and directors at which the Chief Executive Officer is present. The Chief Executive Officer shall have general control and supervision of the policies
and operations of the corporation and shall see that all orders and resolutions of the Board are carried into effect. The Chief Executive Officer shall manage and
administer the corporation’s business and affairs and shall also perform all duties and exercise all powers usually pertaining to the office of a chief executive officer
of a corporation. The Chief Executive Officer shall have the authority to cause the employment or appointment of such employees or agents of the corporation as
the conduct of the business of the corporation may require, to fix their compensation, and to remove or suspend any such employee or agent, and, to the extent so
authorized by the Board, to appoint, fix the duties of, and remove or suspend, subordinate officers of the corporation, and such other duties and responsibilities as
may be determined by the Chairman of the Board.
ARTICLE
XIV
Chief
Executive
Officer
of
the
Oil
and
Gas
Business
The Chief Executive Officer of the Oil and Gas business of the corporation shall manage and administer the corporation’s business and affairs with respect to
its oil and gas operations. The Chief Executive Officer of the Oil and Gas business of the corporation shall have the authority to cause the employment or
appointment of such employees or agents of the corporation as the conduct of the Oil and Gas business of the corporation may require, to fix their compensation,
and to remove or suspend any such employee or agent, and, to the extent so authorized by the Board, to appoint, fix the duties of, and remove or suspend,
subordinate officers of the corporation’s Oil and Gas business, and such other duties and responsibilities as may be determined by the Chairman of the Board.
ARTICLE
XV
President
The President shall be the chief operating officer of the corporation, shall see that all orders and resolutions of the Board are carried into effect and shall
perform such duties and exercise such powers as may be assigned to him or her from time to time by the Chairman of the Board. In the event of absence or
disability of the Chief Executive Officer, the duties of the Chief Executive Officer shall be performed, and his or her powers may be exercised, by the President.
The President shall have the duties and powers of the Treasurer if no Treasurer is elected and shall have such other duties and powers as the Board may from time
to time prescribe.
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ARTICLE
XVI
Non-Executive
Vice
Chairman
of
the
Board,
Chief
Financial
Officer,
Executive
Vice
Presidents,
Senior
Vice
Presidents,
Vice
Presidents
and
Assistant
Vice
Presidents
The non-executive Vice Chairman of the Board, Chief Financial Officer, Executive Vice Presidents, Senior Vice Presidents, Vice Presidents and Assistant
Vice Presidents shall have such powers and duties as may be delegated to them by the Board of Directors, the Chairman of the Board, the Office of the Chairman,
the Chief Executive Officer or the President.
ARTICLE
XVII
General
Counsel,
Secretary
and
Assistant
Secretaries
1. The General Counsel shall have the powers and duties usually and customarily associated with the position of General Counsel. He shall have such other
powers and duties as may be delegated to him by the Board of Directors or the Chairman of the Board.
2. The Secretary shall attend all meetings of the Board of Directors and of the stockholders, and shall record the minutes of all proceedings in a book to be
kept for that purpose. He shall perform like duties for the committees of the Board when required.
3. The Secretary shall give, or cause to be given, notice of meetings of the stockholders and of the Board of Directors and of committees of the Board. He
shall keep in safe custody the seal of the corporation, and when authorized by the Chairman of the Board, a Vice Chairman of the Board, the Chief Executive
Officer, the Office of the Chairman, the President, an Executive Vice President, a Senior Vice President, a Vice President or the General Counsel, shall affix the
same to any instrument requiring it, and when so affixed it shall be attested by his signature or by the signature of an Assistant Secretary. He shall have such other
powers and duties as may be delegated to him by the Board of Directors or the Chairman of the Board.
4. The Assistant Secretaries shall, in case of the absence or disability of the Secretary, perform the duties and exercise the powers of the Secretary, and shall
have such other powers and duties as may be delegated to them by the Board of Directors or the Chairman of the Board.
ARTICLE
XVIII
Treasurer
and
Assistant
Treasurers
1. The Treasurer shall have the custody of the corporate funds and
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securities, and shall deposit or cause to be deposited under his direction all moneys and other valuable effects in the name and to the credit of the corporation in
such depositories as may be designated by the Board of Directors or pursuant to authority granted by it. He shall render to the Chairman of the Board and the Board
of Directors, whenever they may require it, an account of all his transactions as Treasurer and of the financial condition of the corporation. He shall have such other
powers and duties as may be delegated to him by the Board of Directors or the Chairman of the Board.
2. The Assistant Treasurers shall, in case of the absence or disability of the Treasurer, perform the duties and exercise the powers of the Treasurer, and shall
have such other powers and duties as may be delegated to them by the Board of Directors or the Chairman of the Board.
ARTICLE
XIX
Controller
and
Assistant
Controllers
1. The Controller shall maintain adequate records of all assets, liabilities and transactions of the corporation, and shall see that adequate audits thereof are
currently and regularly made. He shall disburse the funds of the corporation in payment of the just obligations of the corporation, or as may be ordered by the
Board of Directors, taking proper vouchers for such disbursements. He shall have such other powers and duties as may be delegated to him by the Board of
Directors or the Chairman of the Board.
2. The Assistant Controllers shall, in case of the absence of the Controller, perform the duties and exercise the powers of the Controller, and shall have such
other powers and duties as may be delegated to them by the Board of Directors or the Chairman of the Board.
ARTICLE
XX
Agents
and
Representatives
The Chairman of the Board, any Vice Chairman of the Board, the Chief Executive Officer, the Chief Executive Officer of the Oil and Gas business of the
corporation, the President, any Executive Vice President, any Senior Vice President or any Vice President, the General Counsel, together with the Secretary or any
Assistant Secretary, are authorized and empowered in the name of and as the act and deed of the corporation, to name and appoint general and special agents,
representatives, and attorneys to represent the corporation in the United States or in any foreign country, and to prescribe, limit and define the powers and duties of
such agents, representatives and attorneys, and to grant, substitute, revoke, or cancel, in whole or in part, any power of attorney or other authority conferred on any
such agent, representative, or attorney. All powers of attorney or other instruments which may be executed pursuant to this provision shall be signed by the
Chairman of the Board, any Vice Chairman of the Board, the Chief Executive
-11-
Officer, the Chief Executive Officer of the Oil and Gas business, the President, any Executive Vice President, any Senior Vice President, or any Vice President, the
General Counsel, and by the Secretary or an Assistant Secretary and the seal of the corporation shall be affixed thereto. No further authorization by the Board of
Directors shall be necessary in connection with the foregoing, it being intended that this By-Law shall constitute full and complete authority by which the officers
above mentioned may act for the purposes aforesaid.
ARTICLE
XXI
Certificates
of
Stock
The shares of the corporation shall be uncertificated or shall be represented by certificates signed in the name of the corporation. The certificates for shares
of stock of the corporation shall be numbered and shall be entered on the books of the corporation as they are issued. The certificated shares shall exhibit the
holder’s name and number of shares and shall be signed by the Chairman of the Board, a Vice Chairman of the Board, the Chief Executive Officer, the President,
an Executive Vice President, a Senior Vice President or a Vice President and by the Treasurer, an Assistant Treasurer, the Secretary or an Assistant Secretary. The
signature of any such officers may be facsimile if such certificate is countersigned by a transfer agent other than the corporation or its employee or by a registrar
other than the corporation or its employee. In case any officer who has signed or whose facsimile signature has been placed on any such certificate shall have
ceased to be such officer before such certificate is issued, then, unless the Board of Directors shall otherwise determine and cause notification thereof to be given to
such transfer agent and registrar, such certificate may be issued by the corporation (and by its transfer agent) and registered by its registrar with the same effect as if
he were such officer at the date of issue.
ARTICLE
XXII
Transfers
of
Stock
1. Upon surrender to the corporation or the transfer agent of a certificate for shares duly endorsed or accompanied by proper evidence of succession,
assignment or authority to transfer, it shall be the duty of the corporation to issue a new certificate to the person entitled thereto, cancel the old certificate and
record the transaction upon its books. Upon receipt of proper transfer instructions from the registered holder of uncertificated shares such uncertificated shares shall
be cancelled and issuance of new equivalent uncertificated shares or certificated shares shall be made to the person entitled thereto and the transaction shall be
recorded upon the books of the corporation.
2. Within a reasonable time after the issuance or transfer of uncertificated shares, the corporation shall send, or cause to be sent, to the registered owner
thereof a written notice containing the information required to be set forth or stated on certificates pursuant to
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Sections 151, 156, 202(a) or 218(a) of the Delaware General Corporation Law or a statement that the corporation will furnish without charge to each stockholder
who so requests the powers, designations, preferences and relative, participating, optional or other special rights of each class of stock or series thereof and the
qualifications, limitations or restrictions of such preferences and rights.
ARTICLE
XXIII
Fixing
Record
Date
In order that the corporation may determine the stockholders entitled to notice of or to vote at any meeting of stockholders or any adjournment thereof, or to
express consent to corporate action in writing without a meeting, or entitled to receive payment of any dividend or other distribution or allotment of any rights, or
entitled to exercise any rights in respect of any change, conversion or exchange of stock or for the purpose of any other lawful action, the Board of Directors may
fix a record date, which record date shall not precede the date upon which the resolution fixing the record date is adopted by the Board of Directors and which
record date: (1) in the case of determination of stockholders entitled to vote at any meeting of stockholders or adjournment thereof, shall, unless otherwise required
by law, not be more than 60 nor less than 10 days before the date of such meeting; (2) in the case of determination of stockholders entitled to express consent to
corporate action in writing without a meeting, shall not be more than 10 days from the date upon which the resolution fixing the record date is adopted by the Board
of Directors; and (3) in the case of any other action, shall not be more than 60 days prior to such other action. If no record date is fixed: (1) the record date for
determining stockholders entitled to notice of or to vote at a meeting of stockholders shall be at the close of business on the day preceding the day on which notice
is given, or, if notice is waived, at the close of business on the day preceding the day on which the meeting is held; (2) the record date for determining stockholders
entitled to express consent to corporate action in writing without a meeting when no prior action of the Board of Directors is required by law, shall be the first date
on which a signed written consent setting forth the action taken or proposed to be taken is delivered to the corporation in accordance with applicable law, or, if
prior action by the Board of Directors is required by law, shall be at the close of business on the day on which the Board of Directors adopts the resolution taking
such prior action; and (3) the record date for determining stockholders for any other purpose shall be at the close of business on the day on which the Board of
Directors adopts the resolution relating thereto. A determination of stockholders of record entitled to notice of or to vote at a meeting of stockholders shall apply to
any adjournment of the meeting; provided, however, that the Board of Directors may fix a new record date for the adjourned meeting.
-13-
ARTICLE
XXIV
Registered
Stockholders
The corporation shall be entitled to treat the holder of record of any share or shares of stock as the holder in fact thereof and, accordingly, shall not be bound
to recognize any equitable or other claim to or interest in such share on the part of any other person, whether or not it shall have express or other notice thereof,
save as expressly provided by the laws of the State of Delaware.
ARTICLE
XXV
Checks
All checks, drafts and other orders for the payment of money, and all promissory notes and other evidences of the corporation shall be signed by such officer
or officers or such other person or persons as may be designated by the Board of Directors or pursuant to authority granted by it.
ARTICLE
XXVI
Fiscal
Year
The fiscal year shall begin the first day of January in each year.
ARTICLE
XXVII
Notices
and
Waivers
1. Whenever by statute or by the Certificate of Incorporation or by these By-Laws it is provided that notice shall be given to any director or stockholder, such
provision shall not be construed to require personal notice, but such notice may also be given in writing, by mail, by depositing the same in the United States mail,
postage prepaid, directed to such stockholder or director at his address as it appears on the records of the corporation, or in default of such address, to such director
or stockholder at the General Post Office in the City of Wilmington, Delaware, and such notice shall be deemed to be given at the time when the same shall be thus
deposited. Notice of special meetings of the Board of Directors may also be given to any director by (i) telephone, (ii) telecopier, (iii) electronic mail, (iv) telex or
(v) telegraph or cable, and in the latter event the notice shall be deemed to be given at the time such notice, addressed to such director at the address hereinbefore
provided, shall be transmitted or delivered to and accepted by an authorized telegraph or cable office.
2. Whenever by statute or by the Certificate of Incorporation or by these By-Laws a notice is required to be given, a written waiver thereof, signed by the
person entitled to
-14-
notice, whether before or after the time stated therein, shall be deemed equivalent to notice. Attendance of any stockholder or director at any meeting thereof shall
constitute a waiver of notice of such meeting by such stockholder or director, as the case may be, except as otherwise provided by statute.
ARTICLE
XXVIII
Alteration
of
By-Laws
These By-Laws may be altered, amended, changed or repealed by vote of the stockholders or at any meeting of the Board of Directors by the vote of a
majority of the directors present or as otherwise provided by statute.
ARTICLE
XXIX
Indemnification
of
Corporate
Personnel
The corporation shall indemnify any person who is or was a director, advisory director, officer, employee or agent of the corporation, or is or was serving at
the request of the corporation as a director, advisory director, officer, employee or agent of another corporation, partnership, joint venture, trust or other enterprise
as provided in the Certificate of Incorporation. Expenses incurred by such a director, advisory director, officer, employee or agent in defending a civil or criminal
action, suit or proceeding shall be paid by the corporation as provided in the Certificate of Incorporation. The corporation shall have power to purchase and
maintain insurance on behalf of any such persons against any liability asserted against him or her and incurred by him or her in any such capacity, or arising out of
his or her status as such, whether or not the corporation would have the power to indemnify him or her against such liability under the provisions of the Certificate
of Incorporation. The indemnification provisions of this Article XXIX and the Certificate of Incorporation shall not be deemed exclusive of any other rights to
which those seeking indemnification may be entitled under any applicable law, by-law, agreement, vote of stockholders or disinterested directors or otherwise.
The provisions of this Article XXIX and Article EIGHTH of the Certificate of Incorporation shall be deemed to be a contract between the corporation and
each person who serves as such director, advisory director, officer, employee or agent of the corporation in any such capacity at any time while this Article XXIX
and Article EIGHTH of the Certificate of Incorporation are in effect. No repeal or modification of the provisions of this Article XXIX and Article EIGHTH of the
Certificate of Incorporation nor, to the fullest extent permitted by law, any modification of law shall adversely affect any right or protection of a director, advisory
director, officer, employee or agent of the corporation then existing at the time of such repeal or modification.
-15-
Exhibit
10.1
EXECUTION COPY
SECOND AMENDMENT TO TERM LOAN AGREEMENT
dated as of February 14, 2013,
among
FREEPORT-MCMORAN INC.,
FREEPORT-MCMORAN OIL & GAS LLC,
The Lenders Party thereto,
JPMORGAN CHASE BANK, N.A.,
as Administrative Agent,
BANK OF AMERICA, N.A.,
as Syndication Agent,
and
HSBC BANK USA, NATIONAL ASSOCIATION,
MIZUHO CORPORATE BANK, LTD.,
SUMITOMO MITSUI BANKING CORPORATION,
THE BANK OF NOVA SCOTIA,
and
THE BANK OF TOKYO-MITSUBISHI UFJ, LTD.,
as Co-Documentation Agents,
J.P. MORGAN SECURITIES LLC,
MERRILL LYNCH, PIERCE, FENNER & SMITH INCORPORATED,
HSBC SECURITIES (USA) INC.,
MIZUHO CORPORATE BANK, LTD.,
SUMITOMO MITSUI BANKING CORPORATION,
THE BANK OF NOVA SCOTIA,
and
THE BANK OF TOKYO-MITSUBISHI UFJ, LTD.,
as Joint Lead Arrangers and Joint Bookrunners,
AGRICULTURAL BANK OF CHINA, NEW YORK BRANCH,
BANK OF MONTREAL, CHICAGO BRANCH,
CANADIAN IMPERIAL BANK OF COMMERCE, NEW YORK AGENCY,
COMPASS BANK,
ROYAL BANK OF CANADA,
THE TORONTO-DOMINION BANK,
STANDARD CHARTERED BANK,
U.S. BANK NATIONAL ASSOCIATION,
and
WELLS FARGO BANK, NATIONAL ASSOCIATION,
as Senior Managing Agents
EXECUTION VERSION
SECOND AMENDMENT dated as of December 9, 2015 (this “ Amendment ”) to the Term Loan Agreement dated as of February 14, 2013, as
amended by the First Amendment dated as of February 27, 2015, (the “ Loan Agreement ”) among FREEPORT-MCMORAN INC. (f/k/a
FREEPORT-MCMORAN COPPER & GOLD INC.) (“ FCX ”), FREEPORT-MCMORAN OIL & GAS LLC) (“ FMOG ” and together with FCX, the
“ Borrowers ”), the Lenders from time to time party thereto and JPMORGAN CHASE BANK, N.A., as administrative agent (in such capacity, the “
Administrative Agent ”).
WHEREAS, the Lenders have made term loans to the Borrowers under the Loan Agreement on the terms and subject to the conditions set forth therein.
Capitalized terms used but not defined herein shall have the meanings assigned to such terms in the Loan Agreement, as amended hereby.
WHEREAS, the Borrowers have requested that the Loan Agreement be amended (a) to modify for a period of time the maximum Total Leverage Ratio
applicable under Section 6.06, (b) to provide for certain changes to interest rate spreads, (c) to require certain mandatory prepayments of Term Loans and (d) to
effect other modifications to the provisions of the Loan Agreement, in each case as set forth herein.
WHEREAS, the Lenders party hereto, constituting the Required Lenders under the Loan Agreement, and the Administrative Agent are willing so to amend
the Loan Agreement on the terms and subject to the conditions hereof.
NOW, THEREFORE, in consideration of the mutual agreements herein contained and other good and valuable consideration, the receipt and sufficiency of
which are hereby acknowledged, the parties hereto hereby agree as follows:
SECTION 1. Amendment of the Loan Agreement. Effective as of the Amendment Effective Date, the Loan Agreement is hereby amended as follows:
The following definitions are added in the appropriate alphabetical order to Section 1.01 of the Loan Agreement:
“ Disposition ” means any sale, transfer, lease or other disposition (including pursuant to a Sale and Leaseback Transaction and by way of merger or
consolidation) of any assets of any Loan Party (other than PTFI) in respect of which Net Proceeds are received by or distributed to FCX, including any sale
or issuance other than to a Borrower or a Subsidiary of any Equity Interests in any Loan Party (other than PTFI) and including forward sales, streaming and
similar transactions, in each case for consideration consisting in whole or part of cash proceeds, other than (i) dispositions in the ordinary course of business
of (x) inventory (excluding, for the avoidance of doubt, forward sales and streaming or similar transactions), (y) used or surplus equipment or (z) cash or
cash equivalents; (ii) dispositions of accounts receivable, (iii) any casualty or other
insured damage to, or any taking under power of eminent domain or by condemnation or similar proceeding of, any assets, (iv) forward sales, streaming and
similar transactions for cumulative aggregate Net Proceeds received during Mandatory Prepayment Periods not in excess of $250,000,000, and (v) other
sales and dispositions resulting in aggregate Net Proceeds received during Mandatory Prepayment Periods not exceeding $100,000,000 in the case of any
single transaction or series of related transactions or $250,000,000 in the aggregate for all such transactions.
“ Mandatory Prepayment Period ” means (i) each period commencing on and including the date of delivery to the Administrative Agent pursuant to
Section 5.01(a) or 5.01(b) of consolidated financial statements in respect of which the Total Leverage Ratio, as of the last day of the most recent fiscal
quarter covered by such financial statements, is in excess of 4.00 to 1.00 and ending on the first date of delivery of consolidated financial statements under
Section 5.01(a) or 5.01(b) thereafter in respect of which the Total Leverage Ratio, as of the last day of the most recent fiscal quarter covered by such
financial statements, is less than or equal to 4.00 to 1.00; provided that a Mandatory Prepayment Period will in any event be deemed to exist if FCX fails to
deliver the consolidated financial statements required to be delivered by it pursuant to Section 5.01(a) or 5.01(b) or the certificate of a Financial Officer
required pursuant to Section 5.01(c) during the period from the expiration of the time for delivery thereof until such consolidated financial statements and
such certificate are delivered.
“ Net Proceeds ” means, with respect to any event, (a) the cash (which term, for purposes of this definition, shall include cash equivalents) proceeds
received in respect of such event, including any cash received in respect of any noncash proceeds, but only as and when received, net of (b) the sum, without
duplication, of (i) all fees and out-of-pocket expenses paid in connection with such event by the Borrowers and the Subsidiaries, (ii) in the case of a
Disposition (including pursuant to a Sale and Leaseback Transaction) of an asset, (A) the amount of all payments required to be made by the Borrowers and
the Subsidiaries as a result of such event to repay Indebtedness (other than Loans) secured by such asset and (B) the pro rata portion of net cash proceeds
thereof (calculated without regard to this clause (B)) attributable to minority interests and not available for distribution to or for the account of the Borrowers
and the Subsidiaries as a result thereof and (iii) the amount of all taxes paid (or reasonably estimated to be payable) by the Borrowers and the Subsidiaries
and the amount of any reserves established by the Borrowers and the Subsidiaries in accordance with GAAP to fund purchase price adjustment,
indemnification and similar contingent liabilities (other than any earnout obligations) reasonably estimated to be payable and that are directly attributable to
the occurrence of such event (as determined reasonably and in good faith by the chief financial officer of FCX). Notwithstanding the foregoing, cash
proceeds from the sale or issuance of any Equity Interests of FCX Oil & Gas Inc. (or any successor entity) or any of its subsidiaries shall not constitute “Net
Proceeds” to the extent FCX furnishes to the Administrative Agent a certificate of a Financial Officer of FCX certifying that FCX or any of its Subsidiaries
intends
2
to invest such Net Proceeds in assets useful in the business of FCX and its Subsidiaries. For purposes of this definition, in the event any contingent liability
reserve established with respect to any event as described in clause (b)(iii) above shall be reduced, the amount of such reduction shall, except to the extent
such reduction is made as a result of a payment having been made in respect of the contingent liabilities with respect to which such reserve has been
established, be deemed to be receipt, on the date of such reduction, of cash proceeds in respect of such event.
“ Sale and Leaseback Transaction ” has the meaning assigned to such term in Section 6.04.
Section 1.01 of the Loan Agreement is further amended by revising the following defined terms to read in their entirety as set forth below:
““ Applicable Rate ” means, for any day and subject to the next following sentence, the applicable rate per annum set forth below under the caption
“ABR Spread”, “Eurodollar Spread” or “Ticking Fee”, as the case may be, based upon the Credit Ratings by Moody’s and S&P applicable on such day:
1.
BBB+
/
Baa1
or
higher
ABR Ticking
Eurodollar Spread Fee Spread (bps
(bps
(bps per per per annum) annum) annum) 125.0 25.0 15.0 2.
BBB
/
Baa2
ABR Eurodollar
Spread Spread (bps
(bps per per annum) annum) 150.0 50.0 Ticking
Fee (bps per annum) 20.0 LEVEL
3.
BBB-
/
Baa3
ABR Eurodollar
Spread Spread (bps
(bps per per annum) annum) 175.0 75.0 Ticking
Fee (bps per annum) 25.0 4.
BB+
/
Ba1
ABR Eurodollar
Spread Spread (bps
(bps per per annum) annum) 200.0 100.0 Ticking
Fee (bps per annum) 35.0 5.
BB/Ba2
or
lower
ABR Eurodollar
Spread Ticking
Spread (bps
Fee (bps per per (bps per annum) annum) annum) 225.0 125.0 45.0 Notwithstanding the foregoing, if and during such periods as the Total Leverage Ratio as of the end of the fiscal quarter of the Borrower (commencing
with the fiscal quarter ending December 31, 2015) for which consolidated financial statements have been most recently delivered pursuant to Section 5.01(a)
or 5.01(b) (a) exceeds 4.00 to 1.00 but is less than or equal to 4.50 to 1.00, the Applicable Rate will be, for any day, a rate per annum 25 basis points in
excess of the rate per annum otherwise applicable as set forth in the table above, and (b) exceeds 4.50 to 1.00, the Applicable Rate will be, for any day, a rate
per annum 50 basis points in excess of the rate per annum otherwise applicable as set forth in the table above.
For purposes of the foregoing, (a) if either Moody’s or S&P shall not have in effect a Credit Rating (other than by reason of the circumstances referred
to in the last sentence of this definition), then FCX and the Lenders shall negotiate in good faith to agree upon another rating agency to be substituted by an
amendment to this Agreement for the rating agency which shall not have a Credit Rating in effect, and pending the effectiveness of such amendment, the
Applicable Rate shall be determined by reference to the available Credit Rating; (b) if the Credit Ratings established or deemed to have been established by
Moody’s and S&P shall fall within different Levels, the Applicable Rate shall be based on the higher
3
of the two Credit Ratings unless one of the two Credit Ratings is two or more Levels lower than the other, in which case the Applicable Rate shall be
determined by reference to the Level next below that of the higher of the two Credit Ratings; and (c) if the Credit Rating established or deemed to have been
established by Moody’s and S&P shall be changed (other than as a result of a change in the rating system of Moody’s or S&P), such change shall be
effective as of the date on which it is first announced by the applicable rating agency. Each change in the Applicable Rate based on the Credit Ratings shall
apply during the period commencing on the effective date of such change and ending on the date immediately preceding the effective date of the next such
change. If the rating system of Moody’s or S&P shall change, or if either such rating agency shall cease to be in the business of rating corporate debt
obligations, FCX and the Lenders shall negotiate in good faith to amend the definition of “Applicable Rate” to reflect such changed rating system or the
unavailability of ratings from such rating agency and, pending the effectiveness of any such amendment, the Applicable Rate shall be determined by
reference to the Credit Rating most recently in effect prior to such change or cessation.
Each change in the Applicable Rate resulting from a change in the Leverage Ratio shall be effective during the period commencing on and including
the date of delivery to the Administrative Agent pursuant to Section 5.01(a) or 5.01(b) of the consolidated financial statements indicating such change and
ending on the date immediately preceding the effective date of the next such change; provided that the Total Leverage Ratio shall be deemed to exceed 4.50
to 1.00 at the option of the Administrative Agent or at the request of the Required Lenders if FCX fails to deliver the consolidated financial statements
required to be delivered by it pursuant to Section 5.01(a) or 5.01(b) or the certificate of a Financial Officer required pursuant to Section 5.01(c) during the
period from the expiration of the time for delivery thereof until such consolidated financial statements and such certificate are delivered.”
Section 2.08(c) of the Loan Agreement is amended by adding immediately after “Any prepayment of a Borrowing” the parenthetical “(including, for
the avoidance of doubt, any mandatory prepayment pursuant to Section 2.09(b))”.
Section 2.09 of the Loan Agreement is amended to read in its entirety as follows:
“SECTION 2.09. Prepayment of Loans . (a) The Borrowers shall have the right at any time and from time to time to prepay any Borrowing in whole or
in part, without premium or penalty, subject to the requirements of this Section and to the making of any payment required under Section 2.14.
Notwithstanding any provision to the contrary herein, the Borrowers may elect to apply voluntary prepayments pursuant to this Section 2.09(a) (but not
mandatory prepayments pursuant to Section 2.09(b)) to the 2018 Loans and the 2020 Loans in such amounts as may be specified in the notice given pursuant
to paragraph (d) of this Section.
4
(b) In the event and on each occasion that any Net Proceeds are received by or on behalf of any Borrower or any Subsidiary in respect of any
Disposition during a Mandatory Prepayment Period, the Borrowers shall, within five Business Days after such Net Proceeds are received by FCX, prepay
Borrowings, ratably as required by paragraph (c) of this Section, in an aggregate amount equal to the lesser of (i) 50% of such Net Proceeds and (ii) such
amount as will result in the Total Leverage Ratio, calculated on a pro forma basis as of the last day of the most recent fiscal quarter covered by consolidated
financial statements delivered pursuant to Section 5.01(a) or 5.01(b) to give effect to such prepayment and to any Material Acquisition, Material Disposition,
incurrence of Indebtedness or repayment of Indebtedness that has occurred thereafter (in accordance, as applicable, with the last paragraph of the definition
of Consolidated EBITDAX), to be no greater than 4.00 to 1.00.
(c) Prior to any optional or mandatory prepayment of 2018 Loans or 2020 Loans hereunder, the Borrowers shall select the Borrowing or Borrowings
of such Loans to be prepaid and shall specify such selection in the notice of such prepayment pursuant to paragraph (d) of this Section. In the event of any
mandatory prepayment of Borrowings pursuant to paragraph (b) of this Section made at a time when Borrowings of both 2018 Loans and 2020 Loans remain
outstanding, the Borrowers shall select Borrowings to be prepaid so that the aggregate amount of such prepayment is allocated between Borrowings of 2018
Loans and Borrowings of 2020 Loans pro rata based on the relative aggregate outstanding principal amounts thereof on the date of such prepayment.
(d) The Borrowers shall notify the Administrative Agent by telephone (confirmed by telecopy) of any optional prepayment and, to the extent
practicable, any mandatory prepayment, hereunder (i) in the case of prepayment of a Eurodollar Borrowing, not later than 12:00 noon, New York City time,
three Business Days before the date of prepayment or (ii) in the case of prepayment of an ABR Borrowing, not later than 12:00 noon, New York City time,
on the date of prepayment. Each such notice shall be irrevocable and shall specify the prepayment date and the principal amount of each Borrowing or
portion thereof to be prepaid and, in the case of any mandatory prepayment, shall include a reasonably detailed calculation of the amount of such prepayment
(including, if applicable, a calculation of the pro forma Total Leverage Ratio referred to in paragraph (b) of this Section). Each partial prepayment of any
Borrowing shall be in an amount that would be permitted in the case of an advance of a Borrowing of the same Type as provided in Section 2.02, except as
necessary to apply fully the required amount of a mandatory prepayment. Each prepayment of a Borrowing shall be applied ratably to the Loans included in
the prepaid Borrowing. Prepayments shall be accompanied by accrued interest to the extent required by Section 2.11.”
Section 6.04 of the Loan Agreement is amended by inserting “(a “ Sale and Leaseback Transaction )” immediately after “the same purpose or
purposes as the property sold or transferred”.
5
Section 6.06 of the Loan Agreement is amended to read in its entirety as follows:
“SECTION 6.06. Total Leverage Ratio . The Borrowers will not permit (a) if a Reversion Election has not been made, the Total Leverage Ratio on the
last day of any fiscal quarter (i) ending on December 31, 2015, to exceed 5.50 to 1.00, (ii) ending during the period from and including March 31, 2016
through and including June 30, 2016, to exceed 5.90 to 1.00, (iii) ending on September 30, 2016, to exceed 5.75 to 1.00, (iv) ending on December 31, 2016,
to exceed 5.00 to 1.00, (v) ending during the period from and including March 31, 2017 through and including December 31, 2017, to exceed 4.25 to 1.00
and (iv) ending on or after March 31, 2018, to exceed 3.75 to 1.00, and (b) if a Reversion Election has been made, the Total Leverage Ratio on the last day of
any fiscal quarter ending on or after the effective date of such Reversion Election to exceed 3.75 to 1.00.”
All schedules and exhibits to the Loan Agreement, in the forms thereof immediately prior to the Amendment Effective Date, will continue to be schedules and
exhibits to the Loan Agreement as amended hereby.
SECTION 2. Representations and Warranties. To induce the other parties hereto to enter into this Amendments each of the Borrowers represents and
warrants to the Administrative Agent and the Lenders that:
(a) (x) the execution, delivery and performance by such Borrower of this Amendment and the performance by such Borrower of the Loan Agreement,
as amended by this Amendment, are within such Borrower’s corporate powers and have been duly authorized by all necessary corporate and, if required,
stockholder action and (y) this Amendment has been duly executed and delivered by such Borrower and, upon the Amendment Effective Date, the Loan
Agreement, as amended hereby, will constitute a legal, valid and binding obligation of such Borrower enforceable against it in accordance with its terms,
subject to applicable bankruptcy, insolvency, reorganization, moratorium or other laws affecting creditors’ rights generally, concepts of reasonableness and
general principles of equity, regardless of whether considered in a proceeding in equity or at law;
(b) the representations and warranties of each Loan Party set forth in the Loan Documents are true and correct in all material respects and as of the
Amendment Effective Date, except where such representations and warranties expressly relate to an earlier date, in which case such representations and
warranties were true and correct on and as of such earlier date; and
(c) no Default has occurred and is continuing on the Amendment Effective Date.
6
SECTION 3. Effectiveness. This Amendment shall become effective as of the first date (the “ Amendment Effective Date ”) on which each of the following
conditions has been satisfied:
The Administrative Agent shall have executed this Amendment and shall have received counterparts hereof duly executed and delivered by each
Borrower and Lenders constituting the Required Lenders.
The Administrative Agent shall have received such board resolutions, secretary’s certificates, officer’s certificates and other documents as the
Administrative Agent may reasonably request relating to the authorization of this Amendment and the transactions contemplated hereby and any other legal
matters relating to the Loan Parties, the Loan Documents or this Amendment, all in form and substance reasonably satisfactory to the Administrative Agent.
The representations set forth in Section 2(b) and Section 2(c) hereof shall be true and correct as of the Amendment Effective Date, and the
Administrative Agent shall have received a certificate, dated the Amendment Effective Date and signed by a Financial Officer of FCX, confirming the same.
The Administrative Agent shall have received payment from the Borrowers in immediately available funds of an amendment fee for the account of
each Lender that has executed and delivered a counterpart hereof prior to 5:00 p.m., New York City time, on December 8, 2015, in an amount equal to
0.125% of the outstanding principal amount of such Lender’s Loans on the Amendment Effective Date.
The Administrative Agent shall notify the Borrowers and the Lenders of the Amendment Effective Date and such notice shall be conclusive and binding.
Notwithstanding the foregoing, this Amendment shall not become effective unless each of the conditions set forth or referred to in this Section 3 has been satisfied
at or prior to 5:00 p.m., New York City time, on January 5, 2016 (it being understood that any such failure of this Amendment to become effective will not affect
any rights or obligations of any Person under the Loan Agreement).
SECTION 4. Expenses. The Borrowers agree to reimburse the Administrative Agent for its reasonable out-of-pocket expenses in connection with this
Amendment, including the reasonable fees, charges and disbursements of Cravath, Swaine & Moore LLP, counsel for the Administrative Agent, in each case to the
extent provided in Section 9.03(a) of the Loan Agreement.
SECTION 5. Effect of Amendment. (a) Except as expressly set forth herein, this Amendment shall not by implication or otherwise limit, impair, constitute a
waiver of or otherwise affect the rights and remedies of the Lenders or the Administrative Agent under the Loan Agreement or any other Loan Document, and shall
not alter, modify, amend or in any way affect any of the terms, conditions, obligations, covenants or agreements contained in the Loan Agreement or any other
provision of the Loan
7
Agreement or of any other Loan Document, all of which are ratified and affirmed in all respects and shall continue in full force and effect. Nothing herein shall be
deemed to entitle any Borrower to a consent to, or a waiver, amendment, modification or other change of, any of the terms, conditions, obligations, covenants or
agreements contained in the Loan Agreement or any other Loan Document in similar or different circumstances.
(b) On and after the Amendment Effective Date, each reference in the Loan Agreement to “this Agreement”, “hereunder”, “hereof”, “herein”, or words
of like import, and each reference to the Loan Agreement in any other Loan Document shall be deemed a reference to the Loan Agreement as amended
hereby. This Amendment shall constitute a “Loan Document” for all purposes of the Loan Agreement and the other Loan Documents.
SECTION 6. Applicable Law. THIS AMENDMENT SHALL BE CONSTRUED IN ACCORDANCE WITH AND GOVERNED BY THE LAWS OF THE
STATE OF NEW YORK.
SECTION 7. Counterparts; Integration; Effectiveness . This Amendment may be executed in counterparts (and by different parties hereto on different
counterparts), each of which shall constitute an original, but all of which when taken together shall constitute a single contract. This Amendment, the other Loan
Documents and any separate letter agreements with respect to fees payable to the Administrative Agent constitute the entire contract among the parties relating to
the subject matter hereof and supersede any and all previous agreements and understandings, oral or written, relating to the subject matter hereof. Delivery of an
executed counterpart of a signature page of this Amendment by telecopy or other electronic imaging shall be effective as delivery of a manually executed
counterpart of this Amendment.
SECTION 8. Headings. Section headings used herein are for convenience of reference only, are not part of this Amendment and shall not affect the
construction of, or be taken into consideration in interpreting, this Amendment.
[ Remainder of page intentionally left blank ]
8
IN WITNESS WHEREOF, the parties hereto have caused this Amendment to be duly executed by their respective authorized officers as of the date first
above written.
FREEPORT-MCMORAN INC.,
by /s/ Kathleen L. Quirk
Name: Kathleen L. Quirk
Title: Executive Vice President,
Chief Financial Officer & Treasurer
FREEPORT MCMORAN OIL & GAS LLC,
by /s/ Kathleen L. Quirk
Name: Kathleen L. Quirk
Title: Executive Vice President
JPMORGAN CHASE BANK, N.A.,
individually and as Administrative Agent,
by /s/ Peter S. Predun
Name: Peter S. Predun
Title: Executive Director
[ Signature Page to Second Amendment to the Term Loan Agreement ]
LENDER SIGNATURE PAGE TO THE
SECOND AMENDMENT TO THE TERM LOAN AGREEMENT
OF FREEPORT-MCMORAN INC.
Name of [Lender Signature Pages on File with the
Lender: Administrative Agent]
By Name:
Title:
For any Lender requiring a second signature line:
Name of Lender:
Name of Lender: By Name:
Title:
Exhibit
10.2
EXECUTION
COPY
THIRD AMENDMENT TO REVOLVING CREDIT AGREEMENT
dated as of February 14, 2013,
among
FREEPORT-MCMORAN INC.,
PT FREEPORT INDONESIA,
FREEPORT-MCMORAN OIL & GAS LLC,
The Lenders Party Hereto,
The Issuing Banks Party Hereto,
JPMORGAN CHASE BANK, N.A.,
as Administrative Agent and Swingline Lender,
BANK OF AMERICA, N.A.,
as Syndication Agent,
and
BNP PARIBAS,
CITIBANK, N.A.,
HSBC BANK USA, NATIONAL ASSOCIATION,
MIZUHO BANK, LTD.,
SUMITOMO MITSUI BANKING CORPORATION,
THE BANK OF NOVA SCOTIA and
THE BANK OF TOKYO-MITSUBISHI UFJ, LTD.,
as Co-Documentation Agents,
J.P. MORGAN SECURITIES LLC,
MERRILL LYNCH, PIERCE, FENNER & SMITH INCORPORATED,
BNP PARIBAS SECURITIES CORP.,
CITIGROUP GLOBAL MARKETS INC.,
HSBC SECURITIES (USA) INC., MIZUHO BANK, LTD.,
SUMITOMO MITSUI BANKING CORPORATION,
THE BANK OF NOVA SCOTIA and
THE BANK OF TOKYO-MITSUBISHI UFJ, LTD.,
as Joint Lead Arrangers and Joint Bookrunners,
BANK OF MONTREAL, CHICAGO BRANCH,
CANADIAN IMPERIAL BANK OF COMMERCE, NEW YORK AGENCY,
COMPASS BANK,
ROYAL BANK OF CANADA,
THE TORONTO-DOMINION BANK,
STANDARD CHARTERED BANK,
U.S. BANK NATIONAL ASSOCIATION and
WELLS FARGO BANK, NATIONAL ASSOCIATION,
as Senior Managing Agents
EXECUTION VERSION
THIRD AMENDMENT dated as of December 9, 2015 (this “ Amendment ”) to the Revolving Credit Agreement dated as of February 14, 2013,
as amended by the First Amendment dated as of May 30, 2014 and by the Second Amendment dated as of February 27, 2015 (the “ Credit Agreement
”), among FREEPORT-MCMORAN INC. (“ FCX ”), PT FREEPORT INDONESIA (“ PTFI ”) and FREEPORT-MCMORAN OIL & GAS LLC
(together with FCX and PTFI, the “ Borrowers ”), the Lenders from time to time party thereto and JPMORGAN CHASE BANK, N.A., as
administrative agent (in such capacity, the “ Administrative Agent ”).
WHEREAS, the Lenders have agreed to extend credit to the Borrowers under the Credit Agreement on the terms and subject to the conditions set forth
therein. Capitalized terms used but not defined herein shall have the meanings assigned to such terms in the Credit Agreement, as amended hereby.
WHEREAS, the Borrowers have requested that the Credit Agreement be amended (a) to modify for a period of time the maximum Total Leverage Ratio
applicable under Section 6.06, (b) to provide for certain changes to interest rate spreads, and (c) to effect other modifications to the provisions of the Loan
Agreement, in each case as set forth herein.
WHEREAS, the Lenders party hereto, constituting the Required Lenders under the Credit Agreement, the Administrative Agent, and each Issuing Bank are
willing so to amend the Credit Agreement on the terms and subject to the conditions hereof.
NOW, THEREFORE, in consideration of the mutual agreements herein contained and other good and valuable consideration, the receipt and sufficiency of
which are hereby acknowledged, the parties hereto hereby agree as follows:
SECTION 1. Amendment of the Credit Agreement. Effective as of the Amendment Effective Date, the Credit Agreement is hereby amended as follows:
(a) The definition of “Applicable Rate” in Section 1.01 of the Credit Agreement is amended to read in its entirety as set forth below:
“ Applicable Rate ” means, for any day and subject to the next following sentence, the applicable rate per annum set forth below under the caption
“ABR Spread”, “Eurodollar Spread”, “Commitment Fee”, “Financial LC Participation Fee” or “Performance LC Participation Fee”, as the case may be,
based upon the Credit Ratings by Moody’s and S&P applicable on such day:
Level
1
2
3
4
5
Rating (S&P, Moody’s) BBB+ / Baa1 or higher
BBB / Baa2
BBB- / Baa3
BB+ / Ba1
BB/Ba2 or lower
Eurodollar Spread (bps per annum) ABR Spread (bps per annum) Commitment Fee
(bps per annum) Financial LC Participation Fee
(bps per annum) Performance LC
Participation Fee
(bps per annum) 125.0 150.0 175.0 200.0 25.0 50.0 75.0 100.0 15.0 20.0 25.0 35.0 125.0 150.0 175.0 200.0 62.5 75.0 87.5 100.0 225.0 125.0 45.0 225.0 112.5 Notwithstanding the foregoing, if and during such periods as the Total Leverage Ratio as of the end of the fiscal quarter of the Borrower (commencing
with the fiscal quarter ending December 31, 2015) for which consolidated financial statements have been most recently delivered pursuant to Section 5.01(a)
or 5.01(b) (a) exceeds 4.00 to 1.00 but is less than or equal to 4.50 to 1.00, the Applicable Rate (other than in respect of the Commitment Fee) will be, for
any day, a rate per annum 25 basis points in excess of the rate per annum otherwise applicable as set forth in the table above, and (b) exceeds 4.50 to 1.00,
the Applicable Rate (other than in respect of the Commitment Fee) will be, for any day, a rate per annum 50 basis points in excess of the rate per annum
otherwise applicable as set forth in the table above.
For purposes of the foregoing, (a) if either Moody’s or S&P shall not have in effect a Credit Rating (other than by reason of the circumstances referred
to in the last sentence of this definition), then FCX and the Lenders shall negotiate in good faith to agree upon another rating agency to be substituted by an
amendment to this Agreement for the rating agency which shall not have a Credit Rating in effect, and pending the effectiveness of such amendment, the
Applicable Rate shall be determined by reference to the available Credit Rating; (b) if the Credit Ratings established or deemed to have been established by
Moody’s and S&P shall fall within different Levels, the Applicable Rate shall be based on the higher of the two Credit Ratings unless one of the two Credit
Ratings is two or more Levels lower than the other, in which case the Applicable Rate shall be determined by reference to the Level next below that of the
higher of the two Credit Ratings; and (c) if the Credit Rating established or deemed to have been established by Moody’s and S&P shall be changed (other
than as a result of a change in the rating system of Moody’s or S&P), such change shall be effective as of the date on which it is first announced by the
applicable rating agency. Each change in the Applicable Rate based on the Credit Ratings shall apply during the period commencing on the effective date of
such change and ending on the date immediately preceding the effective date of the next such change. If the rating system of Moody’s or S&P shall change,
or if either such rating agency shall cease to be in the business of rating corporate debt obligations, FCX and the Lenders shall negotiate in good faith to
amend the definition of “Applicable Rate” to reflect such changed rating system or the unavailability of ratings from such rating agency and, pending the
effectiveness of any such amendment, the Applicable Rate shall be determined by reference to the Credit Rating most recently in effect prior to such change
or cessation.
2
Each change in the Applicable Rate resulting from a change in the Total Leverage Ratio shall be effective during the period commencing on and
including the date of delivery to the Administrative Agent pursuant to Section 5.01(a) or 5.01(b) of the consolidated financial statements indicating such
change and ending on the date immediately preceding the effective date of the next such change; provided that the Total Leverage Ratio shall be deemed to
exceed 4.50 to 1.00 at the option of the Administrative Agent or at the request of the Required Lenders if FCX fails to deliver the consolidated financial
statements required to be delivered by it pursuant to Section 5.01(a) or 5.01(b) or the certificate of a Financial Officer required pursuant to Section 5.01(c)
during the period from the expiration of the time for delivery thereof until such consolidated financial statements and such certificate are delivered.”
(b) Section 6.06 of the Credit Agreement is amended to read in its entirety as follows:
“SECTION 6.06. Total Leverage Ratio . The Borrowers will not permit (a) if a Reversion Election has not been made, the Total Leverage Ratio on the
last day of any fiscal quarter (i) ending on December 31, 2015, to exceed 5.50 to 1.00, (ii) ending during the period from and including March 31, 2016
through and including June 30, 2016, to exceed 5.90 to 1.00, (iii) ending on September 30, 2016, to exceed 5.75 to 1.00, (iv) ending on December 31, 2016,
to exceed 5.00 to 1.00, (v) ending during the period from and including March 31, 2017 through and including December 31, 2017, to exceed 4.25 to 1.00
and (iv) ending on or after March 31, 2018, to exceed 3.75 to 1.00, and (b) if a Reversion Election has been made, the Total Leverage Ratio on the last day of
any fiscal quarter ending on or after the effective date of such Reversion Election to exceed 3.75 to 1.00.”
SECTION 2. Representations and Warranties. To induce the other parties hereto to enter into this Amendment, each of the Borrowers represents and
warrants to the Administrative Agent and the Lenders that:
(a) (x) the execution, delivery and performance by such Borrower of this Amendment and the performance by such Borrower of the Credit Agreement,
as amended by this Amendment, are within such Borrower’s corporate powers and have been duly authorized by all necessary corporate and, if required,
stockholder action and (y) this Amendment has been duly executed and delivered by such Borrower and, upon the Amendment Effective Date, the Credit
Agreement, as amended hereby, will constitute a legal, valid and binding obligation of such Borrower enforceable against it in accordance with its terms,
subject to applicable bankruptcy, insolvency, reorganization, moratorium or other laws affecting creditors’ rights generally, concepts of reasonableness and
general principles of equity, regardless of whether considered in a proceeding in equity or at law;
(b) the representations and warranties of each Loan Party set forth in the Loan Documents are true and correct in all material respects as of the
Amendment Effective Date, except where such representations and warranties expressly relate to an earlier date, in which case such representations and
warranties were true and correct on and as of such earlier date; and
3
(c) no Default has occurred and is continuing on the Amendment Effective Date before or after giving effect to any Loans made on such date.
SECTION 3. Effectiveness. This Amendment shall become effective as of the first date (the “ Amendment Effective Date ”) on which each of the following
conditions has been satisfied:
(a) The Administrative Agent shall have executed this Amendment (and its Indonesian language version) and shall have received counterparts hereof
duly executed and delivered by each Borrower, Lenders constituting the Required Lenders, each Issuing Bank and the Administrative Agent.
(b) The Administrative Agent shall have received such board resolutions, secretary’s certificates, officer’s certificates and other documents as the
Administrative Agent may reasonably request relating to the authorization of this Amendment and the transactions contemplated hereby and any other legal
matters relating to the Loan Parties, the Loan Documents or this Amendment, all in form and substance reasonably satisfactory to the Administrative Agent.
(c) The conditions set forth in clauses 4.03(a) and 4.03(b) of the Credit Agreement, as amended hereby, shall be satisfied on and as of the Amendment
Effective Date, and the Administrative Agent shall have received a certificate, dated the Amendment Effective Date and signed by a Financial Officer of
FCX, confirming compliance with such conditions.
(d) The Administrative Agent shall have received payment from the Borrowers in immediately available funds of an amendment fee for the account of
each Lender that has executed and delivered a counterpart hereof prior to 5:00 p.m., New York City time, on December 8, 2015, in an amount equal to
0.125% of the amount of such Lender’s Revolving Commitment on the Amendment Effective Date.
The Administrative Agent shall notify the Borrowers and the Lenders of the Amendment Effective Date and such notice shall be conclusive and binding.
Notwithstanding the foregoing, this Amendment shall not become effective unless each of the conditions set forth or referred to in this Section 3 has been satisfied
at or prior to 5:00 p.m., New York City time, on January 5, 2016 (it being understood that any such failure of this Amendment to become effective will not affect
any rights or obligations of any Person under the Credit Agreement).
SECTION 4. Expenses. Each Borrower agrees to reimburse the Administrative Agent for its reasonable out-of-pocket expenses in connection with this
Amendment, including the reasonable fees, charges and disbursements of Cravath, Swaine & Moore LLP, counsel for the Administrative Agent, in each case to the
extent provided in Section 9.03(a) of the Credit Agreement.
4
SECTION 5. Effect of Amendment. (a) Except as expressly set forth herein, this Amendment shall not by implication or otherwise limit, impair, constitute a
waiver of or otherwise affect the rights and remedies of the Lenders or the Administrative Agent under the Credit Agreement or any other Loan Document, and
shall not alter, modify, amend or in any way affect any of the terms, conditions, obligations, covenants or agreements contained in the Credit Agreement or any
other provision of the Credit Agreement or of any other Loan Document, all of which are ratified and affirmed in all respects and shall continue in full force and
effect. Nothing herein shall be deemed to entitle any Borrower to a consent to, or a waiver, amendment, modification or other change of, any of the terms,
conditions, obligations, covenants or agreements contained in the Credit Agreement or any other Loan Document in similar or different circumstances.
(b) On and after the Amendment Effective Date, each reference in the Credit Agreement to “this Agreement”, “hereunder”, “hereof”, “herein”, or words of
like import, and each reference to the Credit Agreement in any other Loan Document shall be deemed a reference to the Credit Agreement as amended hereby. This
Amendment shall constitute a “Loan Document” for all purposes of the Credit Agreement and the other Loan Documents.
SECTION 6. Applicable Law. THIS AMENDMENT SHALL BE CONSTRUED IN ACCORDANCE WITH AND GOVERNED BY THE LAWS OF THE
STATE OF NEW YORK.
SECTION 7. Counterparts; Integration; Effectiveness . This Amendment may be executed in counterparts (and by different parties hereto on different
counterparts), each of which shall constitute an original, but all of which when taken together shall constitute a single contract. This Amendment, the other Loan
Documents and any separate letter agreements with respect to fees payable to the Administrative Agent constitute the entire contract among the parties relating to
the subject matter hereof and supersede any and all previous agreements and understandings, oral or written, relating to the subject matter hereof. Delivery of an
executed counterpart of a signature page of this Amendment by telecopy or other electronic imaging shall be effective as delivery of a manually executed
counterpart of this Amendment.
SECTION 8. Headings. Section headings used herein are for convenience of reference only, are not part of this Amendment and shall not affect the
construction of, or be taken into consideration in interpreting, this Amendment.
[ Remainder of page intentionally left blank ]
5
IN WITNESS WHEREOF, the parties hereto have caused this Amendment to be duly executed by their respective authorized officers as of the date first
above written.
FREEPORT-MCMORAN INC.,
by /s/ Kathleen L. Quirk
Name: Kathleen L. Quirk
Title: Executive Vice President, Chief Financial Officer &
Treasurer
PT FREEPORT INDONESIA,
by /s/ Robert R. Boyce
Name: Robert R. Boyce
Title: Treasurer
FREEPORT MCMORAN OIL & GAS LLC,
by /s/ Kathleen L. Quirk
Name: Kathleen L. Quirk
Title: Executive Vice President
JPMORGAN CHASE BANK, N.A.,
individually and as Administrative Agent
and Issuing Bank,
by /s/ Peter S. Predun
Name: Peter S. Predun
Title: Executive Director
BANK OF AMERICA, N.A., individually
and as Issuing Bank,
by /s/ James K.G. Campbell
Name: James K.G. Campbell
Title: Director
[ Signature Page to Third Amendment to the Revolving Credit Agreement]
LENDER SIGNATURE PAGE TO THE
THIRD AMENDMENT TO THE REVOLVING CREDIT AGREEMENT
OF FREEPORT-MCMORAN INC.
Name of
Lender: [Lender Signatures on File]
By Name:
Title:
For any Lender requiring a second signature line:
Name of
Lender: By Name:
Title:
Exhibit
99.1
333 North Central Avenue ● Phoenix, AZ 85004
Financial
Contacts:
Kathleen
L.
Quirk
(602)
366-8016
Media
Contact:
David
P.
Joint Eric
E.
Kinneberg
(504)
582-p203 (602)
366-7994
Freeport-McMoRan
Announces
Further
Reduction
in
Capital
Spending,
Metals
Production&
Suspension
of
Common
Stock
Dividend
PHOENIX, AZ, December 9, 2015 – Freeport-McMoRan Inc. (NYSE: FCX) today announced additional actions in response to market conditions, including
further revisions to its oil and gas capital spending plans, additional curtailments in copper and molybdenum production and the suspension of its common stock
dividend.
Oil
&
Gas
Review.
As previously reported on August 5, 2015, Freeport-McMoRan Oil & Gas (FM O&G) is deferring investments in several long-term projects in
response to oil and gas market conditions. Following an ongoing review, capital expenditures for 2016 and 2017 have been reduced further from $2.0 billion per
year in 2016 and 2017 to $1.8 billion in 2016 and $1.2 billion in 2017, including idle rig costs. The revised plans, together with initiatives to obtain third party
financing or other strategic alternatives, will be pursued with the goal of achieving funding for oil and gas capital spending within its cash flows and resources.
The revised plans incorporate a reduction in rig utilization from three Deepwater Gulf of Mexico drillships to one drillship while increasing production from
third quarter 2015 rates of 150 barrels of oil equivalents per day (MBOE/d) to an average of 159 MBOE/d in 2016 and 2017. FM O&G expects to bring eight wells
on line in late 2015 and 2016 from its successful tie back drilling operations at the Holstein Deep, Horn Mountain and King Projects in the Deepwater Gulf of
Mexico. These projects, combined with other initiatives, are expected to add low cost oil production, enabling cash production costs to decline from $19 per barrel
of oil equivalents (BOE) in 2015 to less than $16 per BOE in 2016 and 2017. Under the revised plans, FM O&G’s cash flows would substantially fund its capital
expenditures at $45 per barrel of Brent crude oil in 2017.
FM O&G is engaged in ongoing discussions with its rig vendors and other service providers to obtain reductions in costs and to evaluate opportunities to
market idled equipment to third parties.
As previously reported on October 6, 2015, the FCX Board is engaged in a strategic review of its oil and gas business to evaluate alternative courses of
action designed to improve FCX’s financial position, enhance value to FCX shareholders and achieve self-funding of its oil and gas business from its cash flows
and resources. FM O&G’s high quality asset base, its substantial underutilized Deepwater Gulf of Mexico infrastructure, its large inventory of low risk
development opportunities and its talented and experienced personnel and management team provide alternatives to generate value.
Mining
Review.
FCX continues to review its capital projects and costs to maximize cash flow in a weak commodity price environment and to preserve its
resources for anticipated improved future market conditions. FCX previously announced a 25 percent reduction in its capital spending for its mining business for
2016 (from $2.7 billion to $2.0 billion, including $0.6 billion in sustaining capital) and announced curtailments at its North America and South America mines
totaling 250 million pounds of copper and 20 million pounds of molybdenum per year. FCX is undertaking further actions involving plans for a full shut-down of
its Sierrita mine in Arizona and adjustments to its operating plans from its primary molybdenum mines, which will increase its curtailments to approximately
350 million pounds of copper and 34 million pounds of molybdenum per annum. FCX is continuing to evaluate its mining operating plans in response to market
conditions and will make further adjustments as required.
FCX is also evaluating other financing alternatives, the potential sale of minority interests in certain mining assets and other actions to provide additional
proceeds for debt reduction. FCX has a broad set of natural resource assets that provide alternatives for future actions to enhance its financial flexibility.
Freeport-McMoRan
1 Dividend
on
Common
Stock.
FCX also announced today that its Board has suspended its annual common stock dividend of $0.20 per share. This action will
provide cash savings of approximately $240 million per annum and further enhance FCX’s liquidity during this period of weak market conditions. FCX’s Board
will review its financial policy on an ongoing basis and authorize cash returns to shareholders as market conditions improve.
Assuming prices of $2.00 per pound for copper and $45 per barrel Brent crude oil for 2016, FCX estimates consolidated operating cash flow would exceed
capital expenditures by more than $600 million.
James
R.
Moffett,
FCX’s
Chairman
of
the
Board
and
Richard
C.
Adkerson,
Vice
Chairman,
President
and
Chief
Executive
Officer
said,
“We
are
taking
further
actions
to
strengthen
our
financial
position
during
a
period
of
weak
and
uncertain
market
conditions.
While
copper
prices
have
weakened
in
recent
weeks
and
the
near-term
copper
outlook
is
uncertain,
we
view
the
medium
and
longer
term
outlook
positively,
supported
by
copper’s
important
role
in
the
global
economy
and
limitations
on
global
supplies.
As
we
approach
2016,
we
are
positioning
the
company
for
free
cash
flow
generation
in
a
weak
commodity
price
environment
and
remain
focused
on
actions
to
reduce
debt.
Our
high
quality
portfolio
of
long-lived
assets,
flexible
operating
structure
and
experienced
management
team
provide
a
solid
base
to
address
the
current
market
conditions
while
maintaining
an
attractive
portfolio
of
assets
positioned
for
long-term
success.”
Equity
Transactions.
Since commencing its $2 billion at-the-market equity programs in August 2015, FCX has sold a total of 154.6 million shares of common
stock, generating gross proceeds of $1.6 billion through December 4, 2015. Approximately $0.4 billion remains available under the programs. As of December 4,
2015, FCX had 1.19 billion common shares outstanding.
Amendment
to
Bank
Credit
Facility.
Following recent declines in prices for its primary products, FCX has reached agreement with its bank group to amend the
Leverage Ratio (Net Debt/EBITDA) under its revolving credit facility and $4 billion term loan from the previous limit of 4.75x to 5.5x at December 31, 2015, 5.9x
for the first half of 2016, and stepping down to 5.0x by year-end 2016 and 4.25x in 2017. The Leverage Ratio is unchanged at 3.75x thereafter.
FCX is a premier U.S.-based natural resources company with an industry-leading global portfolio of mineral assets, significant oil and gas resources and a
growing production profile. FCX is the world’s largest publicly traded copper producer.
FCX’s portfolio of assets includes the Grasberg minerals district in Indonesia, one of the world’s largest copper and gold deposits; significant mining
operations in the Americas, including the large-scale Morenci minerals district in North America and the Cerro Verde operation in South America; the Tenke
Fungurume minerals district in the DRC; and significant U.S. oil and natural gas assets in the Deepwater GOM, onshore and offshore California and in the
Haynesville natural gas shale, and a position in the Inboard Lower Tertiary/Cretaceous natural gas trend onshore in South Louisiana.
Cautionary
Statement
Regarding
Forward-Looking
Statements:
This press release contains forward-looking statements, which are all statements other than
statements of historical facts, such as expectations relating to commodity prices, development and production activities, production volumes, ability to repay debt,
statements regarding the review of strategic alternatives for FCX’s oil and gas business, including the previously announced potential public offering of a minority
interest in FCX’s oil and gas business, a potential spinoff of FCX’s oil and gas business to its shareholders, potential joint venture arrangements, and potential
further spending reductions, future dividend payments, debt reduction and share purchases and sales. The declaration of dividends is at the discretion of the Board
and will depend on our financial results, cash requirements, future prospects, and other factors deemed relevant by the Board.
FCX cautions readers that forward-looking statements are not guarantees of future performance and actual results may differ materially from those anticipated,
projected or assumed in the forward-looking statements. Important factors that can cause FCX’s actual results to differ materially from those anticipated in the
forward-looking statements include supply of and demand for, and prices of, copper, gold, molybdenum, cobalt, crude oil and natural gas, mine sequencing,
production rates, drilling results, potential effects of cost and capital expenditure reductions and production curtailments on financial results and cash flow, the
outcome of FCX’s strategic review of its oil and gas business, potential additional oil and gas property impairment charges,
Freeport-McMoRan
2 potential inventory adjustments, potential impairment of long-lived mining assets, the outcome of ongoing discussions with the Indonesian government regarding
PT Freeport Indonesia’s (PT-FI) Contract of Work, PT-FI’s ability to obtain renewal of its export license after January 28, 2016, the potential effects of violence
in Indonesia, the resolution of administrative disputes in the Democratic Republic of Congo, industry risks, regulatory changes, political risks, weather- and
climate-related risks, labor relations, environmental risks, litigation results and other factors described in more detail in Part I, Item 1A. “Risk Factors” of FCX’s
annual report on Form 10-K for the year ended December 31, 2014, as updated by FCX’s subsequent filings with the Securities and Exchange Commission.
Investors are cautioned that many of the assumptions on which FCX’s forward-looking statements are based are likely to change after the forward-looking
statements are made, including for example commodity prices, which FCX cannot control, and production volumes and costs, some aspects of which FCX may not
be able to control. Further, FCX may make changes to its business plans that could affect its results. FCX cautions investors that it does not intend to update
forward-looking statements more frequently than quarterly notwithstanding any changes in FCX’s assumptions, changes in business plans, actual experience or
other changes, and FCX undertakes no obligation to update any forward-looking statements.
# # #
Freeport-McMoRan
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