Exhibit 10.14
CONSULTING AGREEMENT
This CONSULTING AGREEMENT ("Agreement"), dated as of June 20, 1995, is
between PHELPS DODGE CORPORATION, a New York corporation, with its principal
place of business at 2600 North Central Avenue, Phoenix, Arizona 85004-3014
("Phelps Dodge") and PATRICK J. RYAN, an individual residing at 5481 E. Lupine
Avenue, Scottsdale, Arizona, 85254 ("Ryan").
Ryan has served as the Senior Vice President of Phelps Dodge and the
Executive Vice President of Phelps Dodge Mining Company ("PDMC"). Ryan has
announced that he is retiring from Phelps Dodge at the close of business on June
30, 1995. Phelps Dodge wishes to continue to benefit from the experience and
expertise Ryan developed in his more than 24 years of service with Phelps Dodge
and its subsidiaries and affiliated entities. Ryan desires to provide his
services to Phelps Dodge on a consulting basis.
Phelps Dodge and Ryan enter into this Agreement to set forth the terms and
conditions pursuant to which Ryan will provide consulting services to Phelps
Dodge following his retirement.
Therefore, in consideration of their mutual promises contained in this
Agreement, Phelps Dodge and Ryan agree as follows:
1. Services. Ryan will provide consulting services relating to projects
identified by Phelps Dodge on a case-by-case basis.
2. Conferences and Meetings. Ryan will attend conferences and meetings when
requested to do so by Phelps Dodge. Phelps Dodge agrees to provide Ryan with
reasonable notice of the conferences and meetings it wants Ryan to attend. If a
conflict arises between Ryan's schedule and a meeting or conference at which
Phelps Dodge desires his attendance, Phelps Dodge and Ryan will cooperate with
each other in attempting to arrange their respective schedules in order to
facilitate Ryan's attendance at the meeting or conference.
3. Compensation. In addition to the special pay and benefits contained in
the Retirement Agreement between Ryan and Phelps Dodge, Phelps Dodge shall pay
Ryan an annual gross fee of $75,000 for his consulting services. Ryan will work
at the Company's request for up to 60 days per year for this amount. For each
day in a year in excess of 60 days that Ryan works at the request of Phelps
Dodge, he will be paid the gross sum of $1,300. Phelps Dodge shall not be
responsible for providing Ryan any benefits that it normally provides its
employees, except for those benefits provided by the Retirement Agreement
between Ryan and Phelps Dodge.
4. Payment. Phelps Dodge shall pay Ryan on a quarterly basis, and the
payments will be made within 10 calendar days after the end of each calendar
quarter. The annual fee of $75,000 will be paid in installments of a gross
amount of $18,750 for each calendar quarter. Any additional amounts due for
consulting services in excess of 60 days in a year will normally be paid within
10 calendar days after the end of the calendar quarter in which Ryan rendered
the additional consulting services. Phelps Dodge will reimburse Ryan for his
reasonable out-of-pocket expenses including, but not limited to, travel,
accommodations, and meals necessarily incurred by Ryan in performing his
consulting services under this Agreement. The general nature of these expenses
will be approved by Phelps Dodge before the expenses are incurred. When
traveling in the course of performing his consulting services under this
Agreement, Ryan will be covered under Phelps Dodge's business travel accident
insurance plan in the same manner as other similarly situated consultants.
5. Term. This Agreement will be for a term of three years from July 1, 1995
through June 30, 1998, unless sooner terminated pursuant to paragraph 15.
6. Non-Competition. Ryan acknowledges that in the course of his employment
and his independent consulting relationship with Phelps Dodge, he had and will
have direct or indirect contact with existing and prospective customers and
others having business dealings with Phelps Dodge and thereby will have the
opportunity to meet and develop on behalf of Phelps Dodge, its subsidiaries and
affiliated entities, goodwill and working relationships with these persons,
firms, or other entities. Ryan acknowledges that such goodwill and relationships
are valuable assets of Phelps Dodge, and he understands and agrees that, because
of the nature of the business of Phelps Dodge, its subsidiaries, and affiliated
entities, it is necessary to afford fair protection to Phelps Dodge for those
assets. Therefore, during the term of this Agreement, Ryan shall not engage,
directly or indirectly, in, or become employed by, serve as an agent or
consultant to, become a partner, principal, or stockholder of any partnership,
corporation or other entity (a "Competitor") which is engaged in any business in
direct competition with Phelps Dodge or any of its subsidiaries or affiliated
entities unless he obtains prior written approval from Phelps Dodge, which
approval will not be unreasonably withheld. During the term of this Agreement,
Ryan shall not develop and sell any found minerals to other persons or entities
without first presenting the opportunity to Phelps Dodge and obtaining its prior
written consent to develop and sell the found minerals to others if Phelps Dodge
is not interested in the opportunity. Phelps Dodge will respond expeditiously to
the opportunities presented to it by Ryan. Ryan acknowledges and agrees that the
geographic scope of this provision has not been limited because Phelps Dodge's
business and customers are worldwide and Phelps Dodge has a legitimate
protectable business interest in its goodwill and relationships with its
customers and in preventing the solicitation of its customers regardless of the
geographical location of its customers or where Ryan is employed if and when he
attempts such solicitation. Ryan's ownership of less than one percent of the
issued and outstanding stock of any corporation whose stock is traded on an
established securities market shall not constitute a violation of this
paragraph.
7. Non-Solicitation. Ryan acknowledges that the employees of Phelps Dodge
are an integral part of the business of Phelps Dodge, and he understands and
agrees that, because of the nature of the business of Phelps Dodge, it is
necessary to afford fair protection to Phelps Dodge from the loss of any such
employees. Therefore, during the term of this Agreement and for two years after
the date that this Agreement terminates (or until June 30, 2000 if Ryan
terminates this Agreement pursuant to paragraph 15), Ryan will not solicit or
otherwise induce any employee of Phelps Dodge, or any of its respective
subsidiaries or affiliated entities, to leave the employ of Phelps Dodge or any
of its subsidiaries or affiliated entities or to become associated, whether as
an employee, officer, parent, director, consultant or otherwise, with any
business organization, including, but not limited to, a Competitor.
8. Non-Disclosure. Ryan acknowledges that the information, observations and
data obtained by him during the course of his employment with Phelps Dodge, and
to be obtained by him during the period of this Agreement, concerning the
business or affairs of Phelps Dodge or any of its subsidiaries or any affiliated
entities are confidential and are the property of Phelps Dodge. Therefore, Ryan
will not at any time disclose to any unauthorized person or use for his own
account any of such information, observations or data without the written
authorization of Phelps Dodge, unless such information, observations or data
have previously been disclosed to the public by Phelps Dodge or have become
public knowledge other than by reason of the actions of Ryan. The provisions of
this paragraph 8 shall survive the term of this Agreement.
9. Remedies. Ryan understands and agrees that Phelps Dodge may suffer
irreparable harm in the event that he breaches any of his material obligations
under this Agreement and that monetary damages will be inadequate to compensate
Phelps Dodge for such breach. Accordingly, Ryan agrees that, in the event of his
material breach or threatened material breach of any of the provisions of this
Agreement, Phelps Dodge, in addition to and not in limitation of any other
rights, remedies or damages available to Phelps Dodge at law or in equity, shall
be entitled to a temporary restraining order, preliminary injunction and
permanent injunction in order to prevent or to restrain any such breach by Ryan
or any or all of his partners, co-venturers, employers, employees, servants,
agents, representatives and any other persons directly or indirectly acting for,
or on behalf of, or with him.
10. Reasonableness; Severability. Ryan has carefully considered his
obligations as stated in this Agreement and agrees that the restrictions
contained in this Agreement are fair and reasonable and are reasonably required
for Phelps Dodge's protection. If, however, the time, geographic, occupational
or other scope of any restrictions of this Agreement should ever be deemed to
exceed that permitted by applicable law or be otherwise over-broad, Ryan agrees
that a court of competent jurisdiction shall enforce that restriction to the
maximum scope permitted by law under the circumstances.
11. Independent Contractor. In providing the consulting services called for
by this Agreement, Ryan will serve as an independent contractor. Nothing
contained in this Agreement shall be construed to constitute Ryan as an officer,
employee, or agent of Phelps Dodge, nor shall either party have the authority to
bind the other in any respect. Ryan will be responsible for his own actions.
Subject to paragraph 6, Ryan may perform services for other businesses, entities
and/or individuals in addition to Phelps Dodge. Phelps Dodge shall not be
required to withhold any federal or state income taxes, FICA or FUTA from the
annual gross fee paid to Ryan for his consulting services. Ryan shall be
responsible for maintaining his own books and records and for the filing of any
taxes or other information returns with any federal or state agencies. Further,
Phelps Dodge will not be responsible for providing Ryan any benefits that it
provides to its employees, including, without limitation, health and life
insurance, disability insurance, and qualified or nonqualified deferred
compensation arrangements of any nature other than those benefits covered by the
Retirement Agreement between Ryan and Phelps Dodge.
12. Office and Materials. Except as provided for in paragraph 4, Ryan is
responsible for all expenses incurred during the performance of his work under
this Agreement. Ryan is to provide the necessary materials, tools, equipment,
and labor to perform the job. Phelps Dodge shall not be required to provide any
office space, equipment, materials, supplies or personnel to Ryan. Ryan is
responsible for hiring, supervising, and paying all support staff necessary to
provide the services called for by this Agreement. Ryan acknowledges that he is
not acting as a representative or agent of Phelps Dodge when he hires,
supervises, or pays his staff or assistants.
13. Working Arrangements. Phelps Dodge does not have the right to and will
not exercise any control or direction over the method by which Ryan chooses to
perform the consulting services called for by this Agreement. Ryan will devote
such time as is required to perform the consulting services. Ryan may use any of
his employees or consultants that he deems necessary to complete the consulting
services. Ryan shall choose the time and manner for performing the consulting
services according to his own routines and schedules. Ryan shall set his own
hours of work. Ryan has no obligation to submit reports relating to the method
in which consulting services are rendered under this Agreement. No training will
be provided by Phelps Dodge to Ryan. Ryan acknowledges that he is not in need of
any training by Phelps Dodge to perform the consulting services called for by
this Agreement.
14. Assignment. Phelps Dodge is retaining the services of Ryan based on his
specific experience and expertise. Therefore, there shall be no assignment of
this Agreement by Ryan without Phelps Dodge's written consent.
15. Termination. Either Phelps Dodge or Ryan may terminate this Agreement
for good cause upon thirty days written notice to the other party. Neither party
shall have the right to terminate this Agreement without good cause, and good
cause will mean a serious breach of the spirit and intent of the Agreement.
16. Resolution of Disputes. Any disputes arising under or in connection
with this Agreement, other than disputes arising under paragraphs 6, 7, 8, 9 and
10, shall be resolved by binding arbitration to be held in Phoenix, Arizona in
accordance with the rules and procedures of the American Arbitration
Association. Judgment upon the award rendered by the arbitrator(s) may be
entered in any court having jurisdiction of the matter. Costs of the arbitration
shall be borne equally by the parties. Unless the arbitrator otherwise
determines, the party that does not prevail in any such action shall reimburse
the other party for his or its reasonable attorneys' fees incurred with respect
to such arbitration.
17. Governing Law. This Agreement shall be governed by the laws of the
State of Arizona.
18. Entire Agreement. This Agreement contains the entire agreement of the
parties. It may not be changed orally, but only by a written agreement signed by
the parties.
IN WITNESS WHEREOF, the parties have executed this Agreement effective as
of the day first written above.
PHELPS DODGE CORPORATION, Patrick J. Ryan
a New York corporation
By________________ _________________
John C. Replogle
Vice President,
Human Resources Date:_____________
Date:______________