Exhibit 10.1
AMENDED AND RESTATED SERVICES AGREEMENT
THIS AMENDED AND RESTATED SERVICES AGREEMENT (this
"Agreement") is dated as of January 1, 1997, by and between
FM Services Company, a Delaware corporation ("FMS"), and
McMoRan Oil & Gas Inc., a Delaware corporation ("MOXY").
WHEREAS, the parties entered into a Services Agreement
dated as of January 1, 1996 (the "Original Agreement")
pursuant to which FMS furnished MOXY and its affiliates, as
that term is defined in Rule 405 under the Securities Act of
1933 (collectively, the "MOXY Group"), with Services, as
defined below, to support and complement the services
provided by the MOXY Group's officers, employees and other
available resources;
WHEREAS, the parties desire to amend the Original
Agreement to provide for a cost of living adjustment to the
Annual Fee, as defined below, and to restate the Original
Agreement as so amended.
NOW THEREFORE, in consideration of the covenants and
agreements set forth herein, and other good and valuable
consideration, the receipt and sufficiency of which are
hereby acknowledged, the parties hereto agree as follows:
Section 1.Services. During the term of this Agreement
FMS shall furnish the following services (collectively, the
"Services") to the MOXY Group: (a) accounting, treasury and
financial, (b) tax, (c) insurance and risk management
(including the purchase and maintenance on behalf of MOXY of
such insurance as MOXY deems necessary or appropriate), (d)
human resources (including employee benefit services), (e)
management information and system support, (f) governmental
relations, (g) community relations, (h) investor relations,
(i) facilities management and security, (j) marketing, (k)
business development, (l) executive support, (m) aviation,
(n) contract administration and (o) such other services as
may mutually be agreed upon by the parties hereto. Services
shall be provided directly by FMS or, in the discretion of
FMS, by affiliated or non-affiliated third parties.
Section 2.Administration of Services. FMS shall keep
the appropriate officers and employees of MOXY and other
members of the MOXY Group fully informed and shall cooperate
with such officers and employees with respect to the
performance of Services by FMS. Each member of the MOXY
Group shall have complete and full access to all data,
records, files, statements, invoices, billings and other
information generated by or in the custody of FMS relating
to Services provided to such entity.
Section 3.Compensation and Reimbursement.
(a) As compensation for the performance of the
Services, MOXY shall pay to FMS an annual fee of $1.0
million, subject to the adjustment set forth in Section 10
hereof (the "Annual Fee"). The Annual Fee shall be payable
in four equal payments on or before the tenth (10th) day of
each calendar quarter in each year during the term of this
Agreement.
(b) MOXY shall reimburse FMS for all costs of goods,
services or other items purchased from third parties by FMS
for the MOXY Group, to the extent such costs are paid by FMS
("Third Party Charges").
Section 4.Use of FMS Facilities. FMS shall provide the
MOXY Group with a non-exclusive right to utilize its
properties and facilities, subject to such limitations, if
any, as may be imposed by leases and other agreements and
instruments governing the use of such properties and
facilities.
Section 5.Term of Agreement; Termination. (a) This
Agreement shall commence as of the date first above written
and shall continue in effect until (i) the parties mutually
agree in writing to terminate this Agreement or (ii) 90 days
after receipt by FMS of written notice from MOXY of its
request to terminate this Agreement. Upon termination of
this Agreement MOXY shall be liable for a pro rata portion
of the Annual Fee and all Third Party Charges incurred in
accordance with Section 3 prior to termination.
Section 6.Limitation of Liability.
(a) FMS makes no representation or warranty
whatsoever, express or implied, with respect to the
Services. In no event shall FMS be liable to MOXY for (i)
any loss, cost or expense resulting from any act or omission
taken at the express direction of any member of the MOXY
Group or (ii) any special, indirect or consequential damages
resulting from any error or omission in the performance of
the Services or from the breach of this Agreement.
(b) Neither FMS nor MOXY shall be liable for any loss
or damage or any nonperformance, partial or whole, under
this Agreement, caused by any strike, labor troubles, riot
act of a public enemy, insurrection, act of God, or any law,
rule or regulation promulgated by any governmental body or
agency, or any demand or requisition of any governmental
body or agency, or any other cause beyond the control of the
parties hereto.
Section 7.Confidentiality. FMS will hold and will use
its best efforts to cause its officers, directors, employees
and other agents (collectively, its "Agents") to hold, in
confidence, all confidential documents and information
concerning the MOXY Group furnished to such party in
connection with this Agreement, except to the extent that
such information can be shown to have been (a) previously
known by such party on a nonconfidential basis, (b) in the
public domain through no fault of such party or (c) later
lawfully acquired by such party on a nonconfidential basis
from a source other than the MOXY Group; provided that FMS
may disclose such information in connection with this
Agreement to its Agents so long as such persons are informed
by FMS of the confidential nature of such information and
are directed by FMS to keep such information confidential
and not to use it for any purpose other than its intended
use. Notwithstanding the foregoing, FMS or its Agents may
disclose such information if (i) compelled to disclose by
judicial or administrative process or by other requirements
of law or (ii) necessary to establish such party's position
in any litigation or any arbitration or other proceeding
based upon or in connection with the subject matter of this
Agreement. Prior to any disclosure pursuant to the
preceding sentence, FMS or its Agent(s) shall give
reasonable prior notice to MOXY of such intended disclosure,
and if requested by MOXY, FMS shall use all reasonable
efforts to obtain a protective order or similar protection
for such information and shall otherwise disclose only such
information as is legally required. If all or any part of
the Services are terminated, FMS will, and will use its best
efforts to cause its Agents to, destroy or deliver to MOXY,
upon request, all documents and other materials, and all
copies thereof, containing confidential information obtained
from the MOXY Group in connection with the Services so
terminated.
Section 8.Technology. FMS hereby grants to MOXY a
royalty free, non-exclusive right and license to use (but
not to sublicense outside of the MOXY Group) any and all
technology, whether or not patented, developed by or on
behalf of FMS, relating to the business of MOXY; provided
that the license hereby granted shall not extend to (i) any
technology developed for a person not affiliated with FMS,
pursuant to an arrangement granting such person exclusive
rights to such technology, or (ii) any technology developed
after the termination of this Agreement.
Section 9.Dispute Resolution. MOXY and FMS shall use
all reasonable efforts to amicably resolve all disputes
arising under this Agreement. If despite such efforts any
matter cannot be amicably resolved the matter shall be
referred to the Presidents of MOXY and FMS who shall
promptly meet for the purpose of resolving such dispute. If
despite such efforts and meetings the matter remains
unresolved, then any affected party may refer the matter to
arbitration for final resolution in accordance with the
commercial rules of the American Arbitration Association.
Any matter submitted to arbitration shall be decided by a
single arbitrator selected by mutual agreement of the
parties (or if the parties cannot agree then such arbitrator
shall be selected by the appropriate official or designee of
the American Arbitration Association). Any such arbitration
proceeding shall be held in New Orleans, Louisiana. Each
party shall bear its own costs and expenses, and the
arbitrator's fees and expenses and the costs and expenses of
the proceeding itself shall be borne by the parties in such
proportions as the arbitrator shall decide. The decision of
the arbitrator shall be final and non-appealable, and may be
enforced in any court of competent jurisdiction.
Section 10.Cost of Living Adjustment.
(a) Prior to the end of the first calendar quarter of
each year during the term of this Agreement, beginning with
the first calendar quarter of 1997, the Annual Fee shall be
adjusted to reflect any cost of living increase (the "Cost
of Living Adjustment"), as provided for in this Section 10.
(b) The Cost of Living Adjustment factor is:
1 + ( (Actual inflation - Base Year inflation) /
Base Year inflation)
where Actual inflation = CPI-U for the December
preceding the year for which the Cost of
Living Adjustment is being calculated; Base
Year inflation = CPI-U for December 1995; and
CPI-U = the Consumer Price Index, as
published by the Bureau of Labor Statistics,
U.S. Department of Labor, For All Urban
Consumers, U.S.C. City Average, All Items,
1982-84=100.
(c) The Annual Fee shall be multiplied by the Cost of
Living Adjustment factor as determined above if such factor
is greater than one. The Cost of Living Adjustment factor
shall be determined as soon as practicable after the end of
each calendar year.
(d) In the event the Bureau of Labor Statistics stops
publishing the CPI-U or substantially changes its content
and format, FMS will substitute another comparable index
published at least annually by a mutually agreeable source.
If the Bureau of Labor Statistics merely redefines the base
year for the CPI-U from 1982-84 to another year, MOXY and
FMS will continue to use the CPI-U, but will convert the
Base Year to the new base year by using the appropriate
conversion formula.
Section 11.Miscellaneous.
(a) The parties hereto are independent contractors.
Nothing in this Agreement is intended or shall be deemed to
constitute a partnership, agency, franchise or joint venture
relationship between the parties. Neither party shall incur
any debts or make any commitments upon the other, except to
the extent specifically provided herein.
(b) This Agreement constitutes the entire agreement
between the parties hereto with respect to the matters set
forth in this Agreement. This Agreement shall not be
amended, modified or supplemented except by an instrument in
writing executed by each of the parties hereto.
(c) All notices and other communications hereunder
shall be in writing and shall be given by hand delivery,
certified or registered mail, return receipt requested or
telecopy transmission with confirmation of receipt to the
address of each of the parties set forth opposite the
signature of such party on the signature page hereof. All
notices and communications shall be deemed given upon
receipt thereof.
(d) This Agreement shall be governed by and construed
in accordance with the internal laws of the State of
Louisiana without the application of any conflicts of laws
principles.
(e) This Agreement shall inure to the benefit of and
be binding upon the parties hereto and their respective
successors and assigns. This Agreement shall not be
assignable by any party hereto without the prior written
consent of the other party.
IN WITNESS WHEREOF, the parties hereto have executed
this Agreement as of the date first above written.
Address for Notices: FM SERVICES COMPANY
1615 Poydras Street
New Orleans, LA 70112 By: /s/ Michael J. Arnold
___________________________
Attention: General Counsel Michael J. Arnold
President
Address for Notices: McMoRan OIL & GAS INC.
1615 Poydras Street
New Orleans, LA 70112 By: /s/ Richard C. Adkerson
_____________________________
Attention: General Counsel Richard C. Adkerson
Co-Chairman of the Board and
Chief Executive Officer