CONFORMED COPY
3,810,000 Shares
FREEPORT-McMoRan COPPER & GOLD INC.
Depositary Shares
Each Initially Representing 0.025 Shares of
Silver-Denominated Preferred Stock
(Par Value $0.10 Per Share)
U.S. UNDERWRITING AGREEMENT
July 22, 1994
LEHMAN BROTHERS INC.
GOLDMAN, SACHS & CO.
KIDDER, PEABODY & CO. INCORPORATED
MERRILL LYNCH, PIERCE, FENNER &
SMITH INCORPORATED
S.G.WARBURG & CO. INC.
As Representatives (the "Representatives") for each of
the several U.S. Underwriters named in Schedule 1,
c/o LEHMAN BROTHERS INC.
American Express Tower
World Financial Center
200 Vesey Street
New York, New York 10285
Dear Sirs:
Subject to all of the terms and conditions herein set forth,
Freeport-McMoRan Copper & Gold Inc., a Delaware corporation (the
"Company"), proposes to sell to the U.S. Underwriters named in Schedule 1
hereto (the "U.S. Underwriters") 3,810,000 shares (the "Firm Stock") of
the Company's Depositary Shares (the "Depositary Shares"), each initially
representing 0.025 Shares of Silver-Denominated Preferred Stock, par value
$0.10 per share (the "Securities"), and to grant to the U.S. Underwriters
an option to purchase up to an additional 570,000 Depositary Shares (the
"Option Stock"). The Securities are to be deposited by the Company against
delivery of Depositary Receipts ("Depositary Receipts") evidencing the
Depositary Shares, which are to be issued by Mellon Securities Trust
Company, as depositary (the "Depositary"), under a Deposit Agreement, to be
dated as of July 25, 1994 (the "Deposit Agreement"), among the Company, the
Depositary and the holders from time to time of the Depositary Receipts
issued thereunder. The Firm Stock and the Option Stock, if purchased, are
hereinafter collectively called the "Stock." This is to confirm the
agreement concerning the purchase of the Stock from the Company by the U.S.
Underwriters.
It is understood by all parties that the Company is
concurrently entering into an agreement dated the date hereof (the
"International Underwriting Agreement") providing for the sale by the
Company of up to 1,092,320 Depositary Shares (consisting of 950,000 shares
of International Firm Stock and up to 142,320 shares of International
Option Stock (each as defined therein)) (the "International Stock")
through arrangements with certain underwriters outside the United States
(collectively, the "International Managers"), for whom Lehman Brothers
International (Europe), Goldman Sachs International, Kidder, Peabody
International plc, Merrill Lynch International Limited and S.G. Warburg
Securities Ltd. are acting as lead managers. The U.S. Underwriters and
the International Managers are simultaneously entering into an agreement
between the U.S. and international underwriting syndicates (the "Agreement
Between U.S. Underwriters and International Managers") which provides for,
among other things, the transfer of Depositary Shares between the two
syndicates. Two forms of prospectus are to be used in connection with the
offering and sale of Depositary Shares contemplated by the foregoing, one
relating to the Stock and the other relating to the International Stock.
The latter form of prospectus will be identical to the former except for
certain substitute pages. Except as used in Sections 2, 3, 4, 9 and 10
herein, and except as the context may otherwise require, references herein
to the Stock shall include all the Depositary Shares which may be sold
pursuant to either this agreement or the International Underwriting
Agreement, and reference herein to any prospectus whether in preliminary or
final form, and whether as amended or supplemented, shall include both the
U.S. and international versions thereof.
1. Representations, Warranties and Agreements of the Company.
The Company represents, warrants and agrees that:
(a) A registration statement on Form S-3 (File No. 33-52503)
with respect to, among other things, the Securities and the
Depositary Shares representing the Securities, including a
prospectus, has been carefully prepared by the Company in conformity
with the requirements of the Securities Act of 1933 ("Act") and the
rules and regulations ("Rules and Regulations") of the Securities
and Exchange Commission ("Commission") thereunder and filed with the
Commission and has become effective. Such registration statement
and prospectus may have been amended or supplemented prior to the
date of this Agreement; any such amendment or supplement was so
prepared and filed and any such amendment filed after the effective
date of such registration statement has become effective. No stop
order suspending the effectiveness of the registration statement or
preventing or suspending the use of any Preliminary Prospectus (as
hereinafter defined) has been issued and no proceeding for that
purpose has been instituted or threatened by the Commission. A
prospectus supplement ("Prospectus Supplement") setting forth the
terms of the Securities and the Depositary Shares and of their sale
and distribution has been or will be so prepared and will be filed
pursuant to Rule 424(b) of the Rules and Regulations on or before
the second business day after the date hereof (or such earlier time
as may be required by the Rules and Regulations); and the Rules and
Regulations do not require the Company to, and, without the consent
of the Representatives, the Company will not, file a post-effective
amendment after the time of execution of this Agreement and prior to
the filing of such Prospectus Supplement (other than any document
filed under the Securities Exchange Act of 1934 (the "Exchange Act")
that upon filing is deemed to be incorporated by reference therein).
Copies of such registration statement and prospectus, any such
amendment or supplement and all documents incorporated by reference
therein that were filed with the Commission on or prior to the date
of this Agreement (including one fully executed copy of the
registration statement and of each amendment thereto for each of the
Representatives and for counsel for the Underwriters) have been
delivered to the Representatives. Such registration statement, as
it may have heretofore been amended, is referred to herein as the
"Registration Statement", and the final form of prospectus included
in the Registration Statement, as supplemented by the Prospectus
Supplement, is referred to herein as the "Prospectus",
which term shall also include (when used with respect to an offer or
sale of Securities or Depositary Shares in Canada) the offering
circular prepared by the Company for the purpose of making offers
and sales of the Securities and Depositary Shares in Canada, in the
form heretofore agreed upon. Each form of Prospectus, Prospectus
Supplement, or Prospectus and Prospectus Supplement, if any,
heretofore made available for use in offering the Securities is
referred to herein as a "Preliminary Prospectus". Any reference
herein to the Registration Statement, the Prospectus, any amendment
or supplement thereto or any Preliminary Prospectus shall be deemed
to refer to and include the documents incorporated by reference
therein, and any reference herein to the terms "amend", "amendment"
or "supplement" with respect to the Registration Statement or
Prospectus shall be deemed to refer to the filing of any document
with the Commission deemed to be incorporated by reference therein
that has not heretofore been delivered to the Representatives.
(b) Each part of the Registration Statement, when such part
became or becomes effective, each Preliminary Prospectus, on the
date of filing thereof with the Commission, and the Prospectus and
any amendment or supplement thereto, on the date of filing thereof
with the Commission and on each Delivery Date (as hereinafter
defined), conformed or will conform in all material respects with
the requirements of the Act and the Rules and Regulations; each part
of the Registration Statement, when such part became or becomes
effective, did not or will not contain an untrue statement of a
material fact or omit to state a material fact required to be stated
therein or necessary to make the statements therein not misleading;
each Preliminary Prospectus, on the date of filing thereof with the
Commission, and the Prospectus and any amendment or supplement
thereto, on the date of filing thereof with the Commission and on
each Delivery Date, did not or will not include an untrue statement
of a material fact or omit to state a material fact necessary to
make the statements therein, in the light of the circumstances under
which they were made, not misleading; provided that no
representation or warranty is made as to information contained in or
omitted from the Registration Statement or the Prospectus in
reliance upon and in conformity with written information furnished
to the Company by any Representative, through the Representatives by
or on behalf of any U.S. Underwriter or by any International
Manager specifically for inclusion therein.
(c) The documents incorporated by reference in the Registration
Statement, the Prospectus, any amendment or supplement thereto or any
Preliminary Prospectus, when they became or become effective under the
Act or were or are filed with the Commission under the Exchange Act, as
the case may be, conformed or will conform in all material respects
with the requirements of the Act or the Exchange Act, as applicable,
and the Rules and Regulations of the Commission thereunder.
(d) The consolidated financial statements of the Company
included or incorporated by reference in the Registration Statement
and Prospectus present fairly the consolidated financial position of
the Company as at the dates indicated and its consolidated results
of operations and cash flows for the periods specified and have been
prepared in conformity with generally accepted accounting principles
applied on a consistent basis during the periods involved, except as
indicated therein.
(e) The Company does not have any subsidiaries that would
constitute signicant subsidiaries within the meaning of Rule 405 under
the Act other than P.T. Freeport Indonesia Company, a limited liability
company organized under the laws of Indonesia and domesticated in
Delaware ("PT-FI"), and Rio Tinto Minera, S.A., a limited liability
company organized under the laws of Spain ("RTM").
(f) Each of the Company, Eastern Mining Company, Inc., a
Delaware corporation ("EMC"), and RTM has been duly incorporated and
is validly existing as a corporation in good standing under the laws
of its jurisdiction of incorporation; PT-FI has been domesticated
in the State of Delaware and is in good standing under the laws of
its jurisdiction of domestication and is a limited liability company
duly organized under the laws of the Republic of Indonesia; each of
the Company, PT-FI, EMC and RTM has full power and authority
(corporate and other) to own its properties and conduct its business
as described in the Registration Statement and Prospectus; and each
of the Company, PT-FI and EMC has been duly qualified as a foreign
corporation for the transaction of business and is in good standing
to the extent applicable under the laws of each other jurisdiction
in which it owns or leases properties or conducts any business so as
to require such qualification, except where the failure to be so
qualified or in good standing, considering all such cases in the
aggregate, does not involve a material risk to the business,
properties, financial position or results of operations of the
Company and its subsidiaries.
(g) Except as contemplated in the Prospectus, subsequent to
the respective dates as of which information is given in the
Registration Statement and the Prospectus, none of the Company, PT-FI,
EMC or RTM has incurred any liabilities or obligations, direct
or contingent, or entered into any transactions, not in the ordinary
course of business, that are material to the Company and its
subsidiaries, and there has not been any material change, on a
consolidated basis, in the capital stock, short-term debt or long-
term debt of the Company and its subsidiaries, or any material
adverse change in the prospects, or any material adverse change, or
any development involving a prospective material adverse change, in
the condition (financial or other), business, net worth or results
of operations of the Company and its subsidiaries.
(h) The Company has an authorized capitalization as set
forth in the Prospectus, and all the issued shares of capital stock
of the Company have been duly and validly authorized and issued and
are fully paid and non-assessable; all the issued shares of capital
stock of PT-FI and EMC have been duly and validly authorized and
issued, are fully paid and non-assessable and the portion of such
shares shown by the Prospectus as beneficially owned by the Company
are so owned subject to no security interest, other encumbrance or
adverse claim; and the shares of RTM subscribed for by the Company
constitute all the issued and outstanding shares of RTM and the
Company has good and marketable title to such shares, free and clear
of any mortgage, lien, pledge, charge, security interest,
encumbrance or other adverse claim of any kind and free of any other
limitation or restriction (including any restriction on the right to
vote, sell or otherwise dispose of such shares), except that the
Company is currently negotiating a sale to a third party of
approximately five percent of the stock of a subsidiary of the
Company that acts as a holding company for the shares of RTM.
(i) The Securities and the Depositary Shares have been duly
authorized by the Company and the Securities, when issued and delivered
against payment therefor as contemplated hereby, will be validly
issued, fully paid and non-assessable; when the Depositary Receipts are
issued in accordance with the provisions of the Deposit Agreement, such
Depositary Receipts will entitle the holders thereof to the rights
specified in such Depositary Receipts and in the Deposit Agreement; and
the issuance of the Securities and the Depositary Shares are not
subject to the preemptive rights of any stockholder of the Company.
(j) Neither the Company nor any of its agents or other persons
acting on its behalf (other than the U.S. Underwriters or the
International Managers, as to which no representation is made), has
marketed the Securities or the Depositary Shares as futures contracts
or commodity options or, except to the extent necessary to describe the
functioning of the Securities and Depositary Shares or to comply with
applicable disclosure requirements, as having the characteristics of
futures contracts or commodity options.
(k) The Deposit Agreement has been duly authorized, and when
duly executed and delivered by the Company, the Deposit Agreement
will constitute a valid and binding obligation of the Company
enforceable in accordance with its terms, subject to bankruptcy,
insolvency, reorganization and other laws of general applicability
relating to or affecting creditors' rights and to general equity
principles; and the persons in whose names such Depositary Receipts
are registered will be entitled to the rights specified in such
Depositary Receipts and in the Deposit Agreement.
(l) Pursuant to the terms of the Certificate of
Designations, and as described in the Prospectus, the Securities are
subject to mandatory redemption, out of funds legally available
therefor, in equal portions by the Company on August 1 of each year
commencing August 1, 1999 and concluding with the redemption of all
remaining outstanding Securities on August 1, 2006.
(m) The Depositary Shares, the Deposit Agreement and the
Securities conform, or when so issued will conform, in all material
respects to the descriptions thereof contained in the Prospectus.
(n) The statements in the Prospectus under the captions
"Relationship of the Company Group with the FTX Group", "Description of
Preferred Stock" and "Description of Depositary Shares" and in the
Prospectus Supplement under the captions "Description of
Silver-Denominated Preferred Stock" and "Description of Depositary
Shares", insofar as such statements constitute summaries of the
documents and matters referred to therein, fairly and accurately
present the information called for with respect to such documents and
matters.
(o) Except as set forth in the Prospectus, there is not pending
or, to the knowledge of the Company, threatened, any action, suit or
proceeding to which the Company, PT-FI, EMC or RTM is a party before or
by any court or governmental agency or body, which could reasonably be
expected to result in any material adverse change in the condition
(financial or other), business, prospects, net worth or results of
operations of the Company and its subsidiaries, or would reasonably be
expected to materially and adversely affect the properties or assets
thereof.
(p) The issuance and delivery of the Depositary Shares and the
Securities, the execution and delivery of this Agreement and the
Deposit Agreement by the Company, the consummation by the Company of
the transactions herein and therein contemplated, and the compliance by
the Company with the terms hereof and thereof do not and will not
conflict with, or result in a breach or violation of, any of the
terms or provisions of, or constitute a default under, the
Certificate of Incorporation or By-laws, as amended (or analogous
documents), of the Company, PT-FI, EMC or RTM or the Certificate of
Domestication of PT-FI or any indenture, mortgage, deed of trust,
loan agreement or other agreement or instrument to which the
Company, PT-FI, EMC or RTM is a party or by which any of their
respective properties or assets are bound, or any applicable law,
rule, regulation, judgment, order or decree of any government,
governmental instrumentality or court, domestic or foreign, having
jurisdiction over the Company, PT-FI, EMC or RTM or any of their
respective properties or assets (other than any such conflict,
breach, violation or default which, individually or in the
aggregate, would not have a material adverse effect on the condition
(financial or other), business, prospects, net worth or results of
operations of the Company and its subsidiaries taken as a whole);
and no consent, approval, authorization, order, registration or
qualification of or with any government, governmental
instrumentality or court, domestic or foreign, including, without
limitation, the U.S. Commodity Futures Trading Commission (the
"CFTC"), is required for the valid authorization by the Company of
the Securities or the Depositary Shares, the issuance and delivery
of the Depositary Shares, the valid authorization, execution,
delivery and performance by the Company of this Agreement and the
Deposit Agreement or the consummation by the Company of the
transactions contemplated by this Agreement and the Deposit
Agreement, except the filing with the Secretary of State of the
State of Delaware of a certificate of designations with respect to
the Securities and except such consents, approvals, authorizations,
orders, registrations or qualifications as are required under the
Act and the securities or Blue Sky laws of the various states in
connection with the purchase by the U.S. Underwriters and
distribution of the Securities and the Depositary Shares.
(q) This Agreement has been duly authorized, executed and
delivered by the Company.
(r) The Company will apply the net proceeds from the sale of
the Securities as set forth in the Prospectus.
(s) There are no contracts or documents of the Company, PT-
FI, EMC or RTM that are required to be filed as exhibits to the
Registration Statement or to any of the documents incorporated by
reference therein by the Act, the Exchange Act or the Rules and
Regulations of the Commission thereunder that have not been so filed.
2. Purchase of Stock by the U.S. Underwriters. On the basis of
the representations and warranties contained in, and subject to the terms and
conditions of, this Agreement, the Company agrees to sell 3,810,000 shares of
the Firm Stock to the several U.S. Underwriters and each of the U.S.
Underwriters, severally and not jointly, agrees to purchase the number of
shares of the Firm Stock set opposite that U.S. Underwriter's name in Schedule
1 hereto, as such number may be increased in accordance with Section 9.
In addition, the Company hereby grants to the U.S. Underwriters
an option to purchase up to 570,000 shares of Option Stock. Such option is
granted solely for the purpose of covering over-allotments in the sale of Firm
Stock and is exercisable as provided in Section 4 hereof. Shares of Option
Stock shall be purchased severally for the account of the U.S. Underwriters in
proportion to the number of shares of Firm Stock set opposite the name of such
U.S. Underwriters in Schedule 1 hereto. The respective purchase obligations
of each U.S. Underwriter with respect to the Option Stock shall be adjusted by
the Representatives so that no U.S. Underwriter shall be obligated to purchase
Option Stock other than in 100 share amounts.
The purchase price of both the Firm Stock and any Option Stock
shall be $19.96 per share.
The Company shall not be obligated to deliver any of the Stock
to be delivered on the First Delivery Date or the Second Delivery Date (each,
as hereinafter defined), as the case may be, except upon payment for all the
Stock (including the International Stock) to be purchased on such Delivery
Date as provided herein and in the International Underwriting Agreement.
3. Offering of Stock by the U.S. Underwriters. Upon
authorization by the Representatives of the release of the Firm Stock, the
several U.S. Underwriters propose to offer the Firm Stock for sale upon the
terms and conditions set forth in the Prospectus.
Each U.S. Underwriter agrees that, except to the extent
permitted by the Agreement Between U.S. Underwriters and International
Managers, (A) it is not purchasing any Stock for the account of anyone
other than a U.S. Person (as defined below) and (B) it has not offered or
sold, and will not offer, sell, resell or deliver, directly or indirectly,
any of the Stock or distribute any Preliminary Prospectus or Prospectus to
anyone other than a U.S. Person. As used herein, the terms "United
States" and "U.S." shall mean the United States of America (including the
states thereof and the District of Columbia) and its territories, its
possessions and other areas subject to its jurisdiction, and the term "U.S.
Person" shall mean any resident or national of the United States, any
corporation, partnership or other entity created or organized in or under
the laws of the United States or any estate or trust the income of which is
subject to United States federal income taxation regardless of its source
(other than a foreign branch of any U.S. Person), and includes a United
States branch of a person other than a U.S. Person.
Each U.S. Underwriter represents that, assuming the accuracy of
the Company's representations in Section 1, it has not offered or sold, and
agrees that it will not offer or sell, the Securities or Depositary Shares,
directly or indirectly, in Canada or to or for the account of any resident of
Canada in contravention of the applicable securities laws of Canada or any
province or territory thereof.
Each U.S. Underwriter represents, warrants and agrees that
neither it nor any of its agents or other persons acting on its behalf has
marketed or will market the Securities or the Depositary Shares as futures
contracts or commodity options or, except to the extent necessary to describe
the functioning of the Securities and Depositary Shares or to comply with
applicable disclosure requirements, as having the characteristics of futures
contracts or commodity options; and the Representatives confirm to the Company
that each dealer who has marketed or will market the Securities or Depositary
Shares as a "Selected Dealer" at the written request of the Representatives
has agreed to comply with such limitations.
4. Delivery of and Payment for the Stock. Delivery of and
payment for the Firm Stock shall be made at the office of Lehman Brothers
Inc., 388 Greenwich Street (Cashier's Window, Main Level), New York, New
York 10013, at approximately 10:00 a.m., New York City time, on the fifth
full business day following the date of this Agreement or at such other
date or place as shall be determined by agreement between the Representatives
and the Company. This date and time are sometimes referred to as the
"First Delivery Date." On the First Delivery Date, the Company shall deliver
or cause to be delivered certificates
representing the Firm Stock to the Representatives for the account of each
U.S. Underwriter against payment to or upon the order of the Company of
the purchase price by certified or official bank check or checks payable in
Federal (immediately available) funds. Time shall be of the essence, and
delivery of, and payment for, the Firm Stock at the time and place
specified pursuant to this Agreement is a further condition of the
obligation of each U.S. Underwriter and the Company hereunder. Upon
delivery, the Firm Stock shall be registered in such names and in such
denominations as the Representatives shall request in writing not less than
two full business days prior to the First Delivery Date. For the purpose
of expediting the checking and packaging of the certificates for the Firm
Stock, the Company shall make the certificates representing the Firm Stock
available for inspection by the Representatives in New York, New York, not
later than 2:00 p.m., New York City time, on the business day prior to the
First Delivery Date.
At any time on or before the thirtieth day after the date of
this Agreement, the option granted in Section 2 may be exercised by written
notice being given to the Company by the Representatives. Such notice shall
set forth the aggregate number of shares of Option Stock as to which the
option is being exercised, the names in which the shares of Option Stock are
to be registered, the denominations in which the shares of Option Stock are to
be issued and the date and time, as determined by the Representatives, when
the shares of Option Stock are to be delivered; provided, however, that this
date and time shall not be earlier than the First Delivery Date nor earlier
than the third business day after the date on which the option shall have been
exercised nor later than the fifth business day after the date on which the
option shall have been exercised. The date and time the shares of Option
Stock are delivered are sometimes referred to as the "Second Delivery Date"
and the First Delivery Date and the Second Delivery Date are each sometimes
referred to as a "Delivery Date."
Delivery of and payment for the Option Stock shall be made at
the office of Lehman Brothers Inc., 388 Greenwich Street (Cashier's Window,
Main Level), New York, New York 10013 (or at such other place as shall be
determined by agreement between the Representatives and the Company) at
approximately 10:00 a.m., New York City time, on the Second Delivery Date.
On the Second Delivery Date, the Company shall deliver or cause to be
delivered the certificates representing the Option Stock to the
Representatives for the account of each U.S. Underwriter against payment
to or upon the order of the Company of the purchase price by certified or
official bank check or checks payable in Federal (immediately available)
funds. Time shall be of the essence, and delivery of, and payment for, the
Option Stock at the time and place specified pursuant to this Agreement is
a further condition of the obligation of each U.S. Underwriter and the
Company hereunder. Upon delivery, the Option Stock shall be registered in
such names and in such denominations as the Representatives shall request
in the aforesaid written notice. For the purpose of expediting the
checking and packaging of the certificates for the Option Stock, the
Company shall make the certificates representing the Option Stock available
for inspection by the Representatives in New York, New York, not later than
2:00 p.m., New York City time, on the business day prior to the Second
Delivery Date.
5. Further Agreements of the Company. The Company agrees:
(a) The Company will cause the Prospectus Supplement to be
filed as required by Section 1(a) hereof (but only if the
Representatives have not reasonably objected thereto by notice to
the Company after having been furnished a copy a reasonable time
prior to filing) and will notify the Representatives promptly of
such filing; as long as a prospectus is required to be delivered
under the Act in connection with the sale of the Depositary Shares,
the Company will notify the Representatives promptly of the time
when any subsequent amendment to the Registration Statement has
become effective or any subsequent supplement to the Prospectus has
been filed (and furnish the Representatives with copies thereof) and
of any request by the Commission for any amendment or supplement to
the Registration Statement or the Prospectus or for additional
information; it will prepare and file with the Commission, promptly
upon request of the Representatives, any amendments or supplements
to the Registration Statement or the Prospectus that, in the opinion
of the Representatives, may be necessary or advisable in connection
with the distribution of the Securities and the Depositary Shares by
the U.S. Underwriters; it will file no amendment or supplement to
the Registration Statement or Prospectus (other than any document
filed under the Exchange Act that upon filing is deemed to be
incorporated by reference therein) to which the Representatives
shall reasonably object by notice to the Company after having been
furnished a copy a reasonable time prior to the filing; and it will
furnish to the Representatives at or prior to the filing thereof a
copy of any document that upon filing is deemed to be incorporated
by reference in the Registration Statement or the Prospectus.
(b) The Company will advise the Representatives, promptly after
it shall receive notice or obtain knowledge thereof, of the issuance by
the Commission of any stop order suspending the effectiveness of the
Registration Statement, of any order preventing or suspending the use
of any prospectus relating to the Securities or the Depositary Shares,
of the suspension of the qualification of the Securities or the
Depositary Shares for offering or sale in any jurisdiction or of the
initiation or threatening of any proceeding for any such purpose; and
it will promptly use its best efforts to prevent the issuance of any
stop order or of any order preventing or suspending the use of any
prospectus relating to the Securities or the Depositary Shares or
suspending any such qualification or to obtain its withdrawal if such a
stop order or order should be issued.
(c) Within the time during which a prospectus relating to the
Securities or the Depositary Shares is required to be delivered under
the Act, the Company will comply as far as it is able with all
requirements imposed upon it by the Act and by the Rules and
Regulations, as from time to time in force, so far as necessary to
permit the continuance of sales of or dealings in the Securities or the
Depositary Shares as contemplated by the provisions hereof and the
Prospectus. If during such period any event occurs as a result of
which the Prospectus as then amended or supplemented would include an
untrue statement of a material fact or omit to state a material fact
necessary to make the statements therein, in the light of the
circumstances then existing, not misleading, or if during such period
it is necessary to amend or supplement the Registration Statement or
the Prospectus or to file under the Exchange Act any document
incorporated by reference in the Prospectus in order to comply with the
Act or the Exchange Act, the Company will promptly notify the
Representatives and will amend or supplement the Registration Statement
or the Prospectus or file such document (at the expense of the Company)
so as to correct such statement or omission or effect such compliance.
(d) The Company will arrange to qualify the Securities and
the Depositary Shares for sale under the securities laws of such
jurisdictions as the Representatives designate and will maintain
such qualifications in effect so long as required for the
distribution of such Securities and Depositary Shares, except that
the Company shall not be required in connection therewith to qualify
as a foreign corporation or to execute a general consent to service
of process in any such jurisdiction.
(e) Neither the Company nor any of its agents or other persons
acting on its behalf (other than the U.S. Underwriters and the
International Managers, as to which the Company makes no covenant) will
market the Securities or the Depositary Shares as futures contracts or
commodity options or, except to the extent necessary to describe the
functioning of the Securities and Depositary Shares or to comply with
applicable disclosure requirements, as having the characteristics of
futures contracts or commodity options.
(f) The Company will furnish to the Representatives and their
counsel without charge, conformed copies of the Registration Statement
as originally filed and all amendments thereto, whether filed before or
after such Registration Statement originally became effective
(including all exhibits thereto), and each Preliminary Prospectus, the
Prospectus (including all documents incorporated by reference therein)
and any amendments thereof and supplements thereto, in each case as
soon as available and in such quantities as the Representatives may
from time to time reasonably request.
(g) The Company will make generally available to its security
holders as soon as practicable, but in any event not later than 45 days
after the end of the 12-month period beginning at the end of the fiscal
quarter of the Company during which the effective date of the
Registration Statement occurs, an earnings statement of the Company (in
form complying with the provisions of Rule 158 under the Rules and
Regulations), covering such 12-month period that shall satisfy the
provisions of Section 11(a) of the Act, it being understood that the
Company intends to satisfy this requirement by filing of its annual
report on Form 10-K and its quarterly reports on Form 10-Q.
(h) The Company shall not, directly or indirectly, except with
the prior written consent of the Representatives, during the period
beginning from the date hereof and continuing to and including the day
90 days after the date hereof, offer, sell, contract to sell to any
person other than the U.S. Underwriters or otherwise dispose of any
securities of the Company which are, or which are convertible or
exchangeable or exercisable for securities which are, substantially
similar to the Depositary Shares or the Securities (the "Restricted
Securities"), except for the Stock.
(i) The Company will promptly after the date hereof, in the
event it has not already done so, file an application for the
listing of the Depositary Shares on the New York Stock Exchange and
will arrange to cause such Depositary Shares to be duly authorized
for listing thereon, subject to official notice of issuance. The
Company will use its best efforts to cause the Depositary Shares to
be registered under the Exchange Act.
(j) During the period of five years hereafter, the Company
will furnish to the Representatives, as soon as practicable after
the end of each fiscal year, a copy of its annual report to
stockholders for such year; and the Company will furnish to the
Representatives (i) as soon as available, a copy of each report or
definitive proxy statement of the Company filed with the Commission
under the Exchange Act or mailed to shareholders and (ii) from time
to time, such other information concerning the Company as the
Representatives may reasonably request.
6. Expenses. The Company, whether or not the transactions
contemplated hereunder are consummated or this Agreement is terminated, will
pay or cause to be paid all expenses incident to the performance of its
obligations under this Agreement, including (i) the preparation, printing,
filing and distribution of any Preliminary Prospectuses, the Prospectus, the
Registration Statement and any amendments thereof or supplements thereto, (ii)
the preparation, printing and distribution of this Agreement, the
International Managers' Questionnaire, the Agreement Among International
Managers, the Supplemental Agreement Among U.S. Underwriters, the
International Underwriting Agreement, the Agreement Between U.S. Underwriters
and International Managers, any Selling Agreement, the Securities, the
Depositary Receipts, the Deposit Agreement, the Certificate of Designations,
the shares of Common Stock and any Blue Sky memoranda, (iii) the distribution
of the terms of agreement relating to the organization of the underwriting
syndicate and the selling group to the members thereof by mail, telex or other
means of communication, (iv) the issuance and delivery of the Depositary
Receipts to you, (v) the fees and disbursements of the Company's counsel and
accountants and other experts, (vi) the expenses of qualifying the Securities
and the Depositary Shares under state securities laws in accordance with the
provisions of Section 5(d), including filing fees and reasonable fees and
disbursements of your counsel in connection therewith and in connection with
any Blue Sky memoranda, (vii) the fees and expenses of the Depositary and any
agent of the Depositary, including the fees and disbursements of counsel for
the Depositary in connection with the Deposit Agreement and the Depositary
Shares, (viii) the fees and expenses, if any, incurred in connection with the
listing of the Depositary Shares on the New York Stock Exchange and (ix) any
filing fee of the National Association of Securities Dealers, Inc. relating to
the Securities. If the sale of the Securities and the Depositary Shares
provided for herein is not consummated by reason of any failure, refusal or
inability on the part of the Company to perform any agreement on its part to
be performed, or because any other condition of your obligations hereunder
required to be fulfiled by the Company is not fulfiled, the Company will
reimburse you for all reasonable out-of-pocket disbursements (including
reasonable fees and disbursements of counsel) incurred by you in connection
with your investigation, preparing to market and marketing the Securities and
the Depositary Shares or in contemplation of performing your obligations
hereunder. The Company shall not in any event be liable to you for loss of
anticipated profits from the transactions covered by this Agreement.
7. Conditions of U.S. Underwriters' Obligations. The
respective obligations of the U.S. Underwriters hereunder are subject to the
accuracy, when made and on each Delivery Date, of the representations and
warranties of the Company contained herein, to the performance by the Company
of its obligations hereunder and to each of the following additional terms and
conditions:
(a)The Prospectus Supplement shall have been filed as
required by Section 1(a) hereof; and no stop order suspending the
effectiveness of the Registration Statement shall have been issued
and no proceeding for that purpose shall have been instituted or
threatened by the Commission, and any request of the Commission for
additional information (to be included in the Registration Statement
or the Prospectus or otherwise) shall have been complied with to the
satisfaction of the Representatives.
(b)No U.S. Underwriter or International Manager shall have
advised the Company that the Registration Statement or Prospectus, or
any amendment or supplement thereto, contains an untrue statement of
fact that in the opinion of the Representatives is material, or omits
to state a fact that in the opinion of the Representatives or counsel
for the U.S. Underwriters is material and is required to be stated
therein or is necessary to make the statements therein not misleading.
(c)Except as contemplated in the Prospectus, subsequent to
the respective dates as of which information is given in the
Registration Statement and the Prospectus, there shall not have been
any change, on a consolidated basis, in the capital stock (other
than changes resulting from issuances of shares of the Company's
Class A Common Stock, par value $0.10 per share (the "Common
Stock"), in connection with the conversion or exchange of any
security of the Company outstanding on the date as of which such
information is given), short-term debt or long-term debt of the
Company and its subsidiaries, or any adverse change in the
prospects, or any adverse change, or any development involving a
prospective adverse change, in the condition (financial or other),
business, net worth or results of operations of the Company and its
subsidiaries or any change in the rating assigned to any securities
of the Company that, in the judgment of the Representatives, makes
it impractical or inadvisable to offer or deliver the Depositary
Shares on the terms and in the manner contemplated in the
Prospectus.
(d)The Representatives shall have received the opinion of Davis
Polk & Wardwell, special counsel for the Company, dated such Delivery
Date, to the effect that:
(i) The Company has been duly incorporated and is an
existing corporation in good standing under the laws of its
jurisdiction of incorporation and PT-FI has been domesticated
and is in good standing under the laws of its jurisdiction of
domestication;
(ii) The Securities being delivered on such Delivery Date
have been duly authorized and validly issued and are fully paid
and non-assessable; and the issuance of such Securities is not
subject to the preemptive rights of any stockholder of the
Company;
(iii) The Depositary Shares being delivered on such
Delivery Date have been duly issued in accordance with the
provisions of the Deposit Agreement and the persons in whose
names the Depositary Receipts being delivered on such
Delivery Date are registered are entitled to the rights
specified in such Depositary Receipts and in the Deposit
Agreement;
(iv) The Deposit Agreement has been duly authorized,
executed and delivered by the Company, and the Deposit Agreement
constitutes a valid and binding obligation of the Company
enforceable in accordance with its terms, subject to bankruptcy,
insolvency, reorganization and other laws of general
applicability relating to or affecting creditors' rights and to
general equity principles;
(v) Pursuant to the terms of the Certificate of
Designations, and as described in the Prospectus, the
Securities are subject to mandatory redemption, out of funds
legally available therefor, in equal portions by the Company
on August 1 of each year commencing August 1, 1999 and
concluding with the redemption of all remaining outstanding
Securities on August 1, 2006.
(vi) The statements in the Prospectus under the captions
"Relationship of the Company Group with the FTX Group",
"Description of Preferred Stock" and "Description of Depositary
Shares", and in the Prospectus Supplement under the captions
"Description of Silver-Denominated Preferred Stock" and
"Description of Depositary Shares", insofar as such statements
constitute summaries of the documents and matters referred to
therein, fairly and accurately present the information called
for with respect to such documents and matters;
(vii) The Registration Statement has become effective
under the Act; the Prospectus Supplement has been filed as
required by Section 1(a) hereof; and to the best knowledge of
such counsel no stop order suspending the effectiveness of
the Registration Statement or order preventing or suspending
the use of any prospectus relating to the Securities or the
Depositary Shares has been issued under the Act and no
proceedings for that purpose have been instituted or
threatened;
(viii) Each part of the Registration Statement, when such part
became effective, and the Prospectus and any amendment or
supplement thereto, on the date of filing thereof with the
Commission, complied as to form in all material respects with
the requirements of the Act and the Rules and Regulations; and
such counsel has no reason to believe that any such part of the
Registration Statement, when such part became effective,
contained an untrue statement of a material fact or omitted to
state a material fact required to be stated therein or necessary
to make the statements therein not misleading, or that the
Prospectus, as of its date and on such Delivery Date, and any
amendment or supplement thereto, as of the date thereof and on
such Delivery Date, contained an untrue statement of a material
fact or omitted to state a material fact necessary to make the
statements therein, in the light of the circumstances under
which they were made, not misleading; it being understood that
such counsel need express no opinion as to the financial
statements or other financial data included or incorporated by
reference in any of the documents mentioned in this clause
(viii);
(ix) This Agreement has been duly authorized, executed and
delivered by the Company;
(x) The issuance and delivery by the Company of the
Securities and the Depositary Shares, the execution and delivery
of this Agreement and the Deposit Agreement by the Company, the
consummation by the Company of the transactions herein and
therein contemplated and compliance by the Company with the
terms of this Agreement and the Deposit Agreement, will not
result in a breach or violation of any of the terms and
provisions of, or constitute a default under (a) the charter or
by-laws of the Company or PT-FI, or (b) to the best of such
counsel's knowledge, but without any independent investigation,
any Federal securities law of the United States, any law of the
State of New York or the Delaware General Corporation Law, or of
any order, writ, judgment, decree, determination or award
binding on the Company; and no consent, approval, authorization
or order of, or filing with, any court or governmental agency or
body, including, without limitation, the CFTC, is required for
the consummation of the transactions contemplated by this
Agreement, except (i) the filing of the Certificate of
Designations which has been made prior to the First Delivery
Date and (ii) such as have been obtained under the Act and
such as may be required under state laws in connection with
the purchase and distribution of the Depositary Shares by the
several U.S. Underwriters; and
(xi) The offer and sale of the Depositary Shares and the
Securities do not violate the United States Commodity Exchange
Act, as amended (the "CEA"), or the rules and regulations of the
CFTC thereunder.
(e)The Representatives shall have received the opinion of John
G. Amato, Esq., General Counsel of the Company, dated such Delivery
Date, to the effect that:
(i) Each of the Company and PT-FI has full power and
authority (corporate and other) to conduct its business as
described in the Prospectus and is duly qualified to do
business in each jurisdiction in which it owns or leases real
property or in which the conduct of its business requires
such qualification except where the failure to be so qualified,
considering all such cases in the aggregate, does not involve
a material risk to the business, properties, financial
position or results of operations of the Company and its
subsidiaries;
(ii) The documents incorporated by reference in the
Prospectus, when they were filed with the Commission,
complied as to form in all material respects with the
requirements of the Exchange Act and the Rules and
Regulations thereunder; and such counsel believes that none
of such documents, when such documents were so filed,
contained an untrue statement of a material fact or omitted
to state a material fact necessary in order to make the
statements therein, in the light of the circumstances under
which they were made when such documents were so filed, not
misleading, it being understood that such counsel need
express no opinion as to the financial statements or other
financial data included in any of the documents mentioned in
this clause (ii);
(iii) The descriptions in the Prospectus of statutes,
legal and governmental proceedings, contracts and other
documents are accurate and fairly present the information
required to be shown; and such counsel does not know of any
statutes or legal or governmental proceedings required to be
described in the Prospectus that are not described as
required, or of any contracts or documents of a character
required to be described in the Prospectus (or required to be
filed under the Exchange Act if upon such filing they would
be incorporated by reference therein) or to be filed as
exhibits to the Registration Statement that are not described
and filed as required;
(iv) The performance of this Agreement and the Deposit
Agreement and the consummation of the transactions herein and
therein contemplated will not result in a breach or violation of
any of the terms and provisions of, or constitute a default
under, any statute, any agreement or instrument known to such
counsel to which the Company or PT-FI is a party or by which any
of them is bound or to which any of the property of any of them
is subject, or any order, rule or regulation known to such
counsel of any court or governmental agency or body having
jurisdiction over the Company or PT-FI or any of their
properties; and
(v) The Company has an authorized capitalization as set
forth in the Prospectus (other than changes resulting from
issuances of shares of Common Stock in connection with the
conversion or exchange of any security of the Company
outstanding on the date as of which such information is given);
all the issued shares of capital stock of PT-FI shown in the
Prospectus as beneficially owned by the Company have been duly
and validly authorized and issued, are fully paid and
non-assessable and are so owned subject to no security interest,
other encumbrance or adverse claim.
(f)The Representatives shall have received the opinion of Miller
& Chevalier, special tax counsel for the Company, dated such Delivery
Date, to the effect that the description contained under "Certain
Federal Income Tax Consequences" in the Prospectus Supplement is
complete, fair and accurate in all material respects.
(g)The Representatives shall have received the opinion of Ali
Budiardjo, Nugroho, Reksodiputro, special Indonesian counsel for the
Company, dated such Delivery Date, to the effect that:
(i) PT-FI has been duly organized and is an existing
corporation in good standing under the laws of Indonesia;
(ii) the Contract of Work, dated December 30, 1991, between
the Ministry of Mines of the Government of The Republic of
Indonesia, acting for such Government, and PT-FI (the "Contract
of Work"), has been duly authorized, executed and delivered by
and constitutes the valid and binding obligation of the parties
thereto, is in full force and effect and is enforceable in
accordance with its terms;
(iii) other than those already granted in or pursuant to the
Contract of Work and routine authorizations, permissions,
consents or approvals (including approvals required under
certain routine administrative regulations), which are of a
minor nature and which are customarily granted in due course
after application, or the denial of which would not materially
adversely affect the business, present or proposed, of PT-FI, no
registration with, or authorization or order of, The Government
of Indonesia or any subdivision thereof is required to permit
PT-FI to carry out its operations, including those described in
the Prospectus; to procure and import equipment and other
materials therefor; to export its products, or to construct,
equip, own, operate or maintain its assets or business; and
(iv) to the best of such counsel's knowledge after due
inquiry, other than routine tax audits conducted in accordance
with the terms of the Contract of Work, there is no action,
suit, proceeding or investigation by or before any Indonesian
court or governmental authority pending or threatened against or
affecting PT-FI or any of its properties or rights which, if
determined adversely to PT-FI, would in the aggregate have a
material adverse effect on its present or future business or
condition.
(h)The Representatives shall have received from Sullivan &
Cromwell, counsel to the U.S. Underwriters, such opinion or opinions,
dated such Delivery Date, with respect to the incorporation of the
Company, the validity of the Securities and the Depositary Shares being
delivered on such Delivery Date, the Deposit Agreement, the
Registration Statement, the Prospectus and other related matters as the
Representatives reasonably may request, and such counsel shall have
received such papers and information as they request to enable them to
pass upon such matters.
(i)The Representatives shall have received the opinion of
Cleary, Gottlieb, Steen & Hamilton, special commodities counsel to the
U.S. Underwriters, dated such Delivery Date, to the effect that the
offer, sale, issuance and delivery by the Company of the Securities and
the Depositary Shares being delivered on such Delivery Date in the
manner contemplated by this Agreement, the International Underwriting
Agreement and the Prospectus, the execution and delivery of this
Agreement, the International Underwriting Agreement and the Deposit
Agreement and the performance by the Company of its obligations under
the terms of the Securities and the Depositary Shares will not violate
the CEA or the rules and regulations of the CFTC thereunder.
(j)At the time of execution of this Agreement and on each
Delivery Date, the Representatives shall have received a letter from
Arthur Andersen & Co., dated the date of delivery thereof, to the
effect that (i) they are independent certified public accountants with
respect to the Company and PT-FI within the meaning of the Act and the
Rules and Regulations and that the answer to Item 10 of the
Registration Statement form is correct insofar as it relates to them;
(ii) in their opinion, the financial statements and schedules examined
by them included or incorporated by reference in the Registration
Statement and Prospectus comply as to form in all material respects
with the applicable requirements of the Act or the Exchange Act, as
applicable, and the published Rules and Regulations thereunder; and
(iii) as to such other matters as the Representatives may reasonably
request and in form and substance satisfactory to the Representatives.
(k)The Representatives shall have received from the Company a
certificate, signed by the Chairman of the Board, the President or a
Vice President and by the principal financial or accounting officer,
dated such Delivery Date, to the effect that, to the best of their
knowledge based upon reasonable investigation:
(i) The representations and warranties of the Company in
this Agreement are true and correct, as if made at and as of
such Delivery Date, and the Company has complied with all the
agreements and satisfied all the conditions on its part to be
performed or satisfied at or prior to such Delivery Date;
(ii) No stop order suspending the effectiveness of the
Registration Statement has been issued, and no proceeding for
that purpose has been instituted or is threatened by the
Commission; and
(iii) Since the effective date of the Registration
Statement, there has occurred no event required to be set
forth in an amendment or supplement to the Registration
Statement or Prospectus that has not been so set forth, and
there has been no document required to be filed under the
Exchange Act and the Rules and Regulations thereunder that upon
such filing would be deemed to be incorporated by reference
in the Prospectus that has not been so filed.
(l)The Depositary Shares shall have been duly approved for
listing by the New York Stock Exchange, subject only to official
notice of issuance.
(m)On or after the date hereof there shall not have occurred
any of the following: (i) a suspension or limitation in trading in
the Common Stock or in securities generally on the New York Stock
Exchange or the American Stock Exchange or any setting of minimum or
maximum prices or ranges of prices for trading on any such Exchange;
(ii) a moratorium on banking activities in New York declared by
either Federal or New York State authorities; or (iii) any material
adverse change in the financial markets in the United States or any
outbreak or escalation of hostilities or other calamity or crisis
involving the United States, or the declaration by the United States
of a national emergency or war, if the effect of any such event
specified in clause (iii) above in the judgment of the
Representatives makes it impracticable or inadvisable to proceed
with the public offering or the delivery of the Depositary Shares to
be purchased by the U.S. Underwriters.
(n)The Company shall have furnished to the Representatives such
further certificates and documents as the Representatives shall have
reasonably requested.
(o)The closing under the International Underwriting Agreement
shall have occurred concurrently with the closing hereunder on the
First Delivery Date.
All opinions, letters, evidence and certificates mentioned above
or elsewhere in this Agreement shall be deemed to be in compliance with the
provisions hereof only if they are in form and substance satisfactory to
counsel for the U.S. Underwriters.
8. Indemnification and Contribution.
(a) The Company will indemnify and hold harmless each U.S.
Underwriter and each person who controls each U.S. Underwriter within the
meaning of the Act as follows:
(i) against any and all loss, liability, claim, damage and
expense whatsoever, as incurred, joint or several, to which such U.S.
Underwriter may become subject, under the Act or otherwise, arising out
of any untrue statement or alleged untrue statement of a material fact
contained in any part of the Registration Statement (or any amendment
thereto), when such part became effective, or the omission or alleged
omission therefrom of a material fact required to be stated therein or
necessary to make the statements therein not misleading or arising out
of any untrue statement or alleged untrue statement of a material fact
contained in any Preliminary Prospectus or the Prospectus (or any
amendment or supplement thereto) or the omission or alleged omission
therefrom of a material fact necessary in order to make the statements
therein, in the light of the circumstances under which they are made,
not misleading;
(ii) against any and all loss, liability, claim, damage and
expense whatsoever, as incurred, joint or several, to which such U.S.
Underwriter may become subject, under the Act or otherwise, to the
extent of the aggregate amount paid in settlement of any litigation, or
any investigation or proceeding by any governmental agency or body,
commenced or threatened, or of any claim whatsoever based upon any such
untrue statement or omission, or any such alleged untrue statement or
omission, if such settlement is effected with the written consent of
the Company; and
(iii) against any and all expense whatsoever, as incurred by each
U.S. Underwriter (including, subject to Section 8(c) hereof, the fees
and disbursements of counsel chosen by the U.S. Underwriters),
reasonably incurred in investigating, preparing or defending against
any litigation, or any investigation or proceeding by any governmental
agency or body, commenced or threatened, or any claim whatsoever based
upon any such untrue statement or omission, or any such alleged untrue
statement or omission, to the extent that any such expense is not paid
under (i) or (ii) above;
provided, however, that this indemnity agreement shall not apply to any
loss, liability, claim, damage or expense to the extent arising out of any
untrue statement or omission or alleged untrue statement or omission made
in reliance upon and in conformity with written information furnished to
the Company by the Representatives, or by any U.S. Underwriter through the
Representatives, or by any International Manager expressly for use in the
Registration Statement (or any amendment thereto) or any Preliminary
Prospectus or the Prospectus (or any amendment or supplement thereto); and
provided, further, that the Company shall not be liable to any U.S.
Underwriter under the indemnity agreement in this Section 8(a) with respect
to any Preliminary Prospectus to the extent that any such loss, claim,
damage or liability of such U.S. Underwriter results from the fact that
such U.S. Underwriter sold Stock to a person as to whom it shall be
established that there was not sent or given, at or prior to the written
confirmation of such sale, a copy of the Prospectus or of the Prospectus as
then amended or supplemented (in either case excluding documents
incorporated therein by reference) in any case where such delivery is
required by the Act if the Company has previously furnished copies thereof
in sufficient quantity to such U.S. Underwriter and the loss, claim, damage
or liability of such U.S. Underwriter results from an untrue statement or
omission of a material fact contained in the Preliminary Prospectus which
was identified in writing at such time to such U.S. Underwriter and
corrected in the Prospectus or in the Prospectus as then amended or
supplemented (in either case excluding documents incorporated therein by
reference).
(b) Each U.S. Underwriter agrees to indemnify and hold harmless
the Company, each of its directors, each of its officers who signed the
Registration Statement, and each person who controls the Company within the
meaning of the Act, to the same extent as the foregoing indemnity from the
Company to the U.S. Underwriters, but only to the extent the related untrue
statement or alleged untrue statement or omission or alleged omission was made
in the related document referred to in the foregoing indemnity in reliance
upon and in conformity with written information relating to the
Representatives furnished to the Company by the Representatives, or by such
U.S. Underwriter through the Representatives, expressly for inclusion in the
preparation of the documents referred to in the foregoing indemnity.
(c) Promptly after receipt by an indemnified party under
subsection (a) or (b) above of notice of the commencement of any action,
such indemnified party shall, if a claim in respect thereof is to be made
against the indemnifying party under such subsection, notify the
indemnifying party or parties in writing of the commencement thereof; but
the omission so to notify the indemnifying party or parties shall not
relieve it from any liability that it may have to any indemnified party
otherwise than under such subsection. In case any such action shall
be brought against any indemnified party, and it shall notify the
indemnifying party or parties of the commencement thereof, the indemnifying
party or parties shall be entitled to participate in, and, to the extent
that it shall elect, jointly with any other indemnifying party similarly
notified, by written notice delivered to such indemnified party promptly
after receiving the aforesaid notice from such indemnified party, to assume
the defense thereof, with counsel satisfactory to such indemnified party
(who shall not, except with the consent of the indemnified party, be
counsel to the indemnifying party); provided, however, that if, in the
judgment of such indemnified party, a conflict of interest exists where it
is advisable for such indemnified party to be represented by separate
counsel, the indemnified party shall have the right to employ separate
counsel in any such action, in which event the fees and expenses of such
separate counsel shall be borne by the indemnifying party or parties, and
after notice from the indemnifying party or parties to such indemnified
party of its election so to assume the defense thereof and approval by the
indemnified party of counsel, the indemnifying party or parties shall not
be liable to such indemnified party under such subsection for any legal or
other expenses subsequently incurred by such indemnified party in
connection with the defense thereof unless (i) the indemnified party shall
have employed separate counsel in accordance with the proviso to the next
preceding sentence (it being understood, however, that the indemnifying
party or parties shall not be liable for the expenses of more than one such
separate counsel representing the indemnified parties under subparagraph
(a) of this Section 8 who are parties to such action), (ii) the
indemnifying party or parties shall not have employed counsel satisfactory
to the indemnified party to represent the indemnified party within a
reasonable time after notice of commencement of the action or (iii) the
indemnifying party or parties have authorized the employment of counsel for
the indemnified party at the expense of the indemnifying party or parties;
and except that, if clause (i) or (iii) is applicable, such liability shall
be only in respect of the counsel referred to in such clause (i) or (iii).
(d) If the indemnification provided for in this Section 8 is
unavailable or insufficient to hold harmless an indemnified party under
subsection (a) or (b) above in respect of any losses, claims, damages or
liabilities (or actions in respect thereof) referred to therein, then each
indemnifying party shall contribute to the amount paid or payable by such
indemnified party as a result of such losses, claims, damages or
liabilities (or actions in respect thereof) in such proportion as is
appropriate to reflect the relative benefits received by the Company on the
one hand and the U.S. Underwriters on the other from the offering of the
Stock to which such loss, claim, damage or liability (or action in respect
thereof) relates. If, however, the allocation provided by the immediately
preceding sentence is not permitted by applicable law or if the indemnified
party failed to give the notice required under subsection (c) above, then
each indemnifying party shall contribute to such amount paid or payable by
such indemnified party in such proportion as is appropriate to reflect not
only such relative benefits but also the relative fault of the Company on
the one hand and the U.S. Underwriters on the other in connection with the
statements or omissions that resulted in such losses, claims, damages or
liabilities (or actions in respect thereof), as well as any other relevant
equitable considerations. The relative benefits received by the Company on
the one hand and the U.S. Underwriters on the other shall be deemed to be
in the same proportion as the total net proceeds from the offering of the
Stock (before deducting expenses) received by the Company bear to the total
underwriting discounts and commissions received by the U.S. Underwriters,
in each case as set forth in the table on the cover page of the U.S.
Prospectus Supplement. The relative fault shall be determined by reference
to, among other things, whether the untrue or alleged untrue statement of a
material fact or the omission or alleged omission to state a material fact
relates to information supplied by the Company on the one hand or the U.S.
Underwriters on the other and the parties' relative intent, knowledge,
access to information and opportunity to correct or prevent such untrue
statement or omission. The Company and the U.S. Underwriters agree that
it would not be just and equitable if contributions pursuant to this
subsection (d) were to be determined by pro rata allocation (even if the
U.S. Underwriters were treated as one entity for such purpose) or by any
other method of allocation that does not take account of the equitable
considerations referred to above in this subsection (d). The amount paid
or payable by an indemnified party as a result of the losses, claims,
damages or liabilities (or actions in respect thereof) referred to above in
this subsection (d) shall be deemed to include any legal or other expenses
reasonably incurred by such indemnified party in connection with
investigating or defending against any such action or claim.
Notwithstanding the provisions of this subsection (d), no U.S. Underwriter
shall be required to contribute any amount in excess of the amount by which
the total price at which the Stock underwritten by it and distributed to
the public was offered to the public exceeds the amount of any damages
which such U.S. Underwriter has otherwise been required to pay by reason
of such untrue or alleged untrue statement or omission or alleged omission.
No person guilty of fraudulent misrepresentation (within the meaning of
Section 11(f) of the Act) shall be entitled to contribution from any person
who was not guilty of such fraudulent misrepresentation. The U.S.
Underwriters' obligations in this subsection (d) to contribute are several
in proportion to their respective underwriting obligations and not joint.
(e) The U.S. Underwriters severally confirm that the statements
with respect to the public offering of the Stock set forth on the cover page
of, and under the caption "Underwriting" in, the Prospectus are correct and
constitute the only information furnished in writing to the Company by or on
behalf of the U.S. Underwriters specifically for inclusion in the Registration
Statement and the Prospectus.
(f) All representations, warranties, and agreements of the
Company herein or in certificates or letters of officers delivered pursuant
hereto, and the agreements of the several U.S. Underwriters contained in
this Section 8, shall remain operative and in full force and effect
regardless of any termination of this Agreement or any investigation made
by or on behalf of the Company or any U.S. Underwriter or any controlling
person, and shall survive delivery of any Depositary Shares to the U.S.
Underwriters.
9. Defaulting U.S. Underwriters. (a) If any of the U.S.
Underwriters or International Managers shall fail to take up and pay for the
amount of Stock or International Stock, as the case may be, agreed by such
U.S. Underwriter or International Manager to be purchased hereunder or under
the International Underwriting Agreement on any Delivery Date, upon tender of
such Stock or International Stock in accordance with the terms hereof or
thereof, and the amount of Stock and International Stock not purchased does
not aggregate more than 10% of the total amount of Stock and International
Stock that the U.S. Underwriters and International Managers are obligated to
purchase hereunder and thereunder on such Delivery Date, the remaining U.S.
Underwriters shall be obligated to take up and pay for (in proportion to their
respective underwriting obligations hereunder except as may otherwise be
determined by the Representatives) the Stock that the withdrawing or
defaulting U.S. Underwriters agreed but failed to purchase.
(b)If any U.S. Underwriters or International Managers shall fail
to take up and pay for the amount of Stock or International Stock, as the case
may be, agreed by such U.S. Underwriter or International Manager to be
purchased hereunder or under the International Underwriting Agreement on any
Delivery Date, upon tender of such Stock or International Stock in accordance
with the terms hereof or thereof, and the amount of Stock and International
Stock not purchased aggregates more than 10% of the total amount of Stock and
International Stock that the U.S. Underwriters and International Managers are
obligated to purchase hereunder and thereunder on such Delivery Date, and
arrangements satisfactory to you, the International Managers and the Company
for the purchase of such Stock and International Stock by other persons are
not made within 36 hours thereafter, this Agreement shall terminate. In the
event of any such termination the Company shall not be under any liability to
any U.S. Underwriter with respect to Stock not purchased by reason of such
termination (except to the extent provided in Section 6 and Section 8 hereof)
nor shall any U.S. Underwriter (other than a U.S. Underwriter who shall have
failed, otherwise than for some reason permitted under this Agreement, to
purchase the amount of Stock agreed by such U.S. Underwriter to be purchased
hereunder) be under any liability to the Company with respect to such Stock
(except to the extent provided in Section 8 hereof).
10. Termination. The obligations of the U.S. Underwriters
hereunder may be terminated by the Representatives, in their absolute
discretion, by notice given to and received by the Company prior to delivery
of any payment for the Firm Stock if, prior to that time, any of the events
described in Sections 7(c) or 7(m) have occurred.
11. Notices, etc. All statements, requests, notices and
agreements hereunder shall be in writing, and:
(a)if to the U.S. Underwriters, shall be delivered or sent by
mail, telex or facsimile transmission to Lehman Brothers Inc.,
American Express Tower, World Financial Center, 200 Vesey
Street, New York, New York 10285; and
(b)if to the Company, shall be delivered or sent by mail,
telex or facsimile transmission to the address of the Company
set forth in the Registration Statement, Attention: John G.
Amato, Esq., General Counsel;
provided, however, that any notice to a U.S. Underwriter pursuant to Section
8(c) shall be delivered or sent by mail, telex or facsimile transmission to
such U.S. Underwriter at its address set forth in its acceptance telex to the
representatives, which address will be supplied to any other party hereto by
the Representatives upon request. Any such statements, requests, notices or
agreements shall take effect at the time of receipt thereof. The Company
shall be entitled to act and rely upon any request, consent, notice or
agreement given or made on behalf of the U.S. Underwriters by Lehman Brothers
Inc. on behalf of the Representatives.
12. Persons Entitled to Benefit of Agreement. This
Agreement shall inure to the benefit of, and be binding upon the U.S.
Underwriters, the Company and their respective successors. This Agreement
and the terms and provisions hereof are for the sole benefit of only those
persons, except that (A) the representations, warranties, indemnities and
agreements of the Company contained in this Agreement shall also be deemed
to be for the benefit of the person or persons, if any, who control any
U.S. Underwriter within the meaning of Section 15 of the Act and for the
benefit of each International Manager (and controlling persons thereof) who
offers or sells any shares of Stock in accordance with the terms of the
Agreement Between U.S. Underwriters and International Managers and (B) the
indemnity agreement of the U.S. Underwriters contained in Section 8(b) of
this Agreement shall be deemed to be for the benefit of directors of the
Company, officers of the Company who have signed the Registration Statement
and any person controlling the Company within the meaning of Section 15 of
the Act. Nothing in this Agreement is intended or shall be construed to
give any person, other than the persons referred to in this Section 13,
any legal or equitable right, remedy or claim under or in respect of this
Agreement or any provision contained herein.
13. Definition of Terms "Business Day" and "Subsidiary". For
purposes of this Agreement, (a) "business day" means any day on which the New
York Stock Exchange, Inc. is open for trading, other than a day on which banks
are authorized or obligated by law or executive order to close in New York
City and (b) "subsidiary" has the meaning set forth in Rule 405 of the Rules
and Regulations.
14. Governing Law. This Agreement shall be governed by and
construed in accordance with the laws of New York.
15. Counterparts. This Agreement may be executed in one or
more counterparts and, if executed in more than one counterpart, the executed
counterparts shall each be deemed to be an original but all such counterparts
shall together constitute one and the same instrument.
16. Headings. The headings herein are inserted for convenience
of reference only and are not intended to be part of, or to affect the meaning
or interpretation of, this Agreement.
If the foregoing correctly sets forth the agreement between the
Company and the U.S. Underwriters, please indicate your acceptance in the
space provided for the purpose below.
Very truly yours,
FREEPORT-McMoRan COPPER & GOLD INC.
By: /s/ STEPHEN M. JONES
____________________________
Name: Stephen M. Jones
Title: Vice President
Accepted:
LEHMAN BROTHERS INC.
GOLDMAN, SACHS & CO.
KIDDER, PEABODY & CO. INCORPORATED
MERRILL LYNCH, PIERCE, FENNER &
SMITH INCORPORATED
S.G.WARBURG & CO. INC.
For themselves and as Representatives
for each of the several U.S. Underwriters
By: LEHMAN BROTHERS INC.
By: /s/ LAURA HANSEN
_____________________________
Authorized Representative
SCHEDULE 1
Amount of
Depositary
Shares
to be
U.S. Underwriter Purchased
________________ ___________
Lehman Brothers Inc................................................ 344,000
Goldman, Sachs & Co................................................ 344,000
Kidder, Peabody & Co. Incorporated................................. 344,000
Merrill Lynch, Pierce, Fenner & Smith Incorporated................. 344,000
S.G.Warburg & Co. Inc.............................................. 344,000
Bear, Stearns & Co. Inc............................................ 75,000
CS First Boston Corporation........................................ 75,000
Alex Brown & Sons Incorporated..................................... 75,000
Commerzbank Capital Markets Corporation............................ 75,000
Dean Witter Reynolds Inc........................................... 75,000
Dillon, Read & Co. Inc............................................. 75,000
A.G. Edwards & Sons, Inc........................................... 75,000
C.J. Lawrence/Deutsche Bank Securities Corporation................. 75,000
Morgan Stanley & Co. Incorporated.................................. 75,000
Oppenheimer & Co., Inc............................................. 75,000
Prudential Securities Incorporated................................. 75,000
Robertson, Stephens & Company, L.P................................. 75,000
Salomon Brothers Inc............................................... 75,000
Wertheim Schroder & Co. Incorporated............................... 75,000
Advest, Inc........................................................ 40,000
Brean Murray, Foster Securities Inc................................ 40,000
Craigie Incorporated............................................... 40,000
Crowell, Weedon & Co............................................... 40,000
Dain Bosworth Incorporated......................................... 40,000
Doft & Co., Inc.................................................... 40,000
Doley Securities, Inc.............................................. 40,000
Fahnestock & Co. Inc............................................... 40,000
First of Michigan Corporation...................................... 40,000
Josephthal Lyon & Ross Incorporated................................ 40,000
Ladenburg, Thalmann & Co. Inc...................................... 40,000
Legg Mason Wood Walker, Incorporated............................... 40,000
McDonald & Company Securities,Inc.................................. 40,000
Mesirow Financial Inc.............................................. 40,000
Morgan Keegan & Company, Inc....................................... 40,000
The Ohio Company................................................... 40,000
Parallax Group, Inc................................................ 40,000
Ragen MacKenzie Incorporated....................................... 40,000
Rauscher Pierce Refsnes, Inc....................................... 40,000
The Robinson-Humphrey Company, Inc................................. 40,000
Roney & Co......................................................... 40,000
Scott & Stringfellow, Inc.......................................... 40,000
Southcoast Capital Corporation..................................... 40,000
Stifel, Nicolaus & Company, Incorporated........................... 40,000
Sutro & Co. Incorporated........................................... 40,000
Tucker Anthony Incorporated........................................ 40,000
_________
Total..................................................... 3,810,000
=========