EXHIBIT 10.25
January 7, 1997
Senator J. Bennett Johnston, Jr.
1317 Merrie Ridge Road
McLean, VA 22101
Dear Senator Johnston:
This letter will confirm the terms of your agreement (the
"Agreement") with the undersigned, FM Services Company ("FM Services"),
with respect to your performance of consulting services for FM Services
and its subsidiaries and affiliates (collectively with FM Services, the
"Freeport Entities"). The other Freeport Entities include, but are not
limited to, Freeport-McMoRan Inc., Freeport-McMoRan Resource Partners,
Limited Partnership, Freeport-McMoRan Copper & Gold Inc., McMoRan Oil &
Gas Co., and FM Properties Inc.
1. Term. The initial term of this Agreement shall commence
effective as of January 4, 1997 and shall end on December 31, 1997;
provided, however, that the term of this Agreement shall be automatically
extended for additional terms of one calendar year each unless and until
FM Services or you provides a written notice of termination to the other
party ninety (90) or more days prior to December 31st of any calendar
year. All references in this Agreement to its "term" shall be deemed to
include this Agreement's initial term and any renewal terms. Termination
of this Agreement shall not affect any obligations or liabilities which
accrue prior to the effective date of the termination.
2. Scope of Consulting Services. During the term of this
Agreement, you will render consulting services to FM Services and the
other Freeport Entities, upon request, with respect to international
relations, energy industry matters, commercial matters, and other matters
in which you have expertise. You will personally perform all of the
consulting services required under this Agreement, and you will not
delegate to others the performance of such consulting services without FM
Services' prior written consent. The executive officers of any Freeport
Entity seeking your advice will, insofar as reasonably practicable,
consider your convenience in the timing of their requests, and your
failure or inability, by reason of temporary illness or other cause
beyond your control or because of your absence for reasonable periods, to
respond to such requests during any such temporary period shall not be
deemed to constitute a default on your part in the performance of your
consulting services under this Agreement.
3. Consulting Fee. In consideration for your consulting services,
FM Services shall pay to you One Hundred Fifty Thousand and No/100
Dollars ($150,000.00) per annum during this Agreement's term, payable in
quarterly installments of Thirty-Seven Thousand Five Hundred and No/100
Dollars ($37,500.00). The first such installment shall be paid as soon
as practicable after the execution of this Agreement, and all subsequent
installments shall be due and payable on or about the first day of each
calendar quarter thereafter during the term of this Agreement.
FM Services shall also reimburse you for, or advance to you, all
reasonable out-of-pocket travel and other expenses incurred by you at the
request of a Freeport Entity in connection with your performance of
consulting services hereunder. Such expenses shall be reimbursed or
advanced promptly after your submission to FM Services of expense
statements in such reasonable detail as FM Services may require.
Freeport-McMoRan Copper & Gold Inc. has informed FM Services that
you will be nominated to be elected a director of Freeport-McMoRan Copper
& Gold Inc. at its next board meeting. The consulting fee due and paid
under this Agreement shall include the annual director fee payable to all
directors of Freeport-McMoRan Copper & Gold Inc. In addition to the
previously referenced fee, Freeport-McMoRan Copper & Gold Inc. will
separately pay you attendance fees for board and committee meetings and
provide you with stock options, travel expenses associated with board
activities, and all other benefits offered to directors of Freeport-
McMoRan Copper & Gold Inc. on the same terms and conditions as are
offered to the other directors.
4. Nature of the Consulting Relationship. You will perform the
consulting services required under this Agreement as an independent
contractor to, and not as an agent or employee of, FM Services or of any
other Freeport Entity. Except as and to the extent that FM Services or
another Freeport Entity, as the case may be, may otherwise prescribe in
writing, you shall not have any authority to negotiate or to conclude any
contracts on behalf of, or otherwise bind, FM Services or any other
Freeport Entity.
5. Assisting Competitors. During the term of this Agreement, you
will not, without the prior written consent of FM Services (a) render any
services, whether or not for compensation, to other individuals, firms,
corporations or entities in connection with any matter that you
reasonably believe may involve material interests adverse to any Freeport
Entity or (b) engage in any business or activity that you reasonably
believe to be materially detrimental to the business or interests of any
Freeport Entity.
6. Confidential Information. You shall hold in a fiduciary
capacity for the benefit of the Freeport Entities all secret or
confidential information, knowledge, or data (collectively, the
"Confidential Information") relating to any Freeport Entity which you
obtain during the term of this Agreement from a Freeport Entity or from a
third party who obtained such Confidential Information from a Freeport
Entity. Unless disclosure is required by law, you shall not, without the
prior written consent of FM Services, at any time, whether during or
after the term of this Agreement, communicate or divulge any Confidential
Information to anyone other than a Freeport Entity or those other
persons or entities designated by FM Services. All records, files,
drawings, documents, notes, and the like relating to the business or
activities of any Freeport Entity which you shall prepare, use or receive
shall be and remain the sole property of FM Services, or such other
Freeport Entity, as the case may be, and shall be returned upon FM
Services' request. "Confidential Information" shall exclude information
(a) known to you prior to your association with the Freeport Entities,
(b) readily available in the public domain or (c) obtained from third
parties who did not in turn, directly or indirectly, obtain such
information from a Freeport Entity.
7. Miscellaneous. This Agreement is personal to you, and you
shall not assign this Agreement without FM Services' prior written
consent. This Agreement shall be governed by and construed in accordance
with the laws of the State of Louisiana. This Agreement contains the
entire understanding between the FM Services and yourself with respect to
the subject matter hereof. This Agreement may not be amended, modified
or extended other than by a written agreement executed by the parties
hereto.
Please confirm that the foregoing Agreement correctly sets forth the
agreement between FM Services and yourself by signing and returning to FM
Services one of the enclosed copies of this letter.
Very truly yours,
FM SERVICES COMPANY
By: /s/ Michael J. Arnold
___________________________________
Michael J. Arnold
President
I hereby confirm that the foregoing Agreement correctly sets forth
the agreement between FM Services Company and myself.
/s/ J. Bennett Johnston, Jr.
___________________________________
SENATOR J. BENNETT JOHNSTON, JR.
Dated: January 9, 1997.