Exhibit 10.1

 

DISTRIBUTION AGREEMENT

August 10, 2015

J.P. Morgan Securities LLC

383 Madison Avenue

New York, New York 10179

Ladies and Gentlemen:

Freeport-McMoRan Inc., a Delaware corporation (the “Company”), confirms its
agreement with J.P. Morgan Securities LLC, as agent and/or principal under any
Terms Agreement (as defined in Section 1(a) below) (“you” or “JPMS”), with
respect to the issuance and sale from time to time by the Company, in the manner
and subject to the terms and conditions described below in this Distribution
Agreement (this “Agreement”), of shares (the “Shares”) of common stock, $0.10
par value per share (the “Common Stock”), of the Company having an aggregate
Gross Sales Price (as defined in Section 2(b) below) of up to $1,000,000,000
(the “Maximum Amount”) on the terms set forth in Section 1 of this Agreement.
The Shares are described in the Prospectus referred to below.

The Company has filed with the Securities and Exchange Commission (the
“Commission”) a registration statement on Form S-3 that became automatically
effective upon filing with the Commission on August 10, 2015 for the
registration of the Shares under the Securities Act of 1933, as amended, and the
rules and regulations of the Commission thereunder (collectively, the “Act”);
the Registration Statement (as defined below) sets forth the material terms of
the offering, sale and plan of distribution of the Shares and contains
additional information concerning the Company and its business. Except where the
context otherwise requires, “Registration Statement”, as used herein, means the
registration statement, as amended at the time of such registration statement’s
effectiveness for purposes of Section 11 of the Act, as such section applies to
JPMS, including (1) all documents filed as a part thereof or incorporated, or
deemed to be incorporated, by reference therein and (2) any information
contained or incorporated by reference in a prospectus filed with the Commission
pursuant to Rule 424(b) under the Act, to the extent such information is deemed,
pursuant to Rule 430B or Rule 430C under the Act, to be part of the registration
statement at the effective time. Except where the context otherwise requires,
“Basic Prospectus”, as used herein, means the prospectus dated August 10, 2015,
filed as part of the Registration Statement, including the documents
incorporated by reference therein as of the date of such prospectus. Except
where the context otherwise requires, “Prospectus Supplement”, as used herein,
means the most recent prospectus supplement relating to the Shares, to be filed
by the Company with the Commission pursuant to Rule 424(b) under the Act on or
before the second business day after the date hereof (or such earlier time as
may be required under the Act), in the form furnished by the Company to JPMS in
connection with the offering of the Shares. Except where the context otherwise
requires, “Prospectus”, as used herein, means the Prospectus Supplement (and any
additional prospectus supplement prepared in accordance with the provisions of
Sections 4(b) or 4(h) of this Agreement and filed in accordance with the
provisions of Rule 424(b)) together with the Basic Prospectus attached to or
used with the Prospectus Supplement. “Permitted Free Writing Prospectuses”, as
used herein, has the meaning set forth in Section 3(b). Any reference herein to
the Registration Statement, the Basic Prospectus, the Prospectus Supplement, the
Prospectus or

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any Permitted Free Writing Prospectus shall, unless otherwise stated, be deemed
to refer to and include the documents, if any, incorporated, or deemed to be
incorporated, by reference therein (the “Incorporated Documents”), including,
unless the context otherwise requires, the documents, if any, filed as exhibits
to such Incorporated Documents. Any reference herein to the terms “amend”,
“amendment” or “supplement” with respect to the Registration Statement, the
Basic Prospectus, the Prospectus Supplement, the Prospectus or any Permitted
Free Writing Prospectus shall, unless stated otherwise, be deemed to refer to
and include the filing of any document under the Securities Exchange Act of
1934, as amended, and the rules and regulations of the Commission thereunder
(collectively, the “Exchange Act”) on or after the initial effective date of the
Registration Statement or the date of the Basic Prospectus, the Prospectus
Supplement, the Prospectus or such Permitted Free Writing Prospectus, as the
case may be, and deemed to be incorporated therein by reference.

The Company and JPMS agree as follows:

 

  1. Issuance and Sale.

 

  (a) Upon the basis of the representations and warranties and subject to the
terms and conditions set forth herein, on any Exchange Business Day (as defined
below) selected by the Company, the Company and JPMS shall enter into an
agreement in accordance with Section 2 hereof regarding the number of Shares to
be placed by JPMS and the manner in which and other terms upon which such
placement is to occur (each such transaction being referred to as an “Agency
Transaction” or a “Transaction”). The Company may also offer to sell the Shares
directly to JPMS, as principal, in which event it will enter into a separate
agreement (each, a “Terms Agreement”) in substantially the form of Exhibit E
hereto, relating to such sale in accordance with Section 2(g) of this Agreement.
As used in this Agreement, (i) the “Term” shall be the period commencing on the
date hereof and ending on the earlier of (x) the date on which the Gross Sales
Price of Shares issued and sold pursuant to this Agreement and any Terms
Agreements is equal to the Maximum Amount and (y) the termination of this
Agreement pursuant to Section 8 or 9 hereof (the “Termination Date”), (ii) an
“Exchange Business Day” means any day during the Term that is a trading day for
the Exchange, and (iii) “Exchange” means the New York Stock Exchange.

 

  (b)

Subject to the terms and conditions set forth below, the Company appoints JPMS
as agent in connection with the offer and sale of Shares in any Agency
Transactions entered into hereunder. JPMS will use commercially reasonable
efforts to sell such Shares in accordance with the terms and conditions hereof
and of the applicable Transaction Acceptance (as defined below). Neither the
Company nor JPMS shall have any obligation to enter into an Agency Transaction.
The Company shall be obligated to issue and sell through JPMS, and JPMS shall be
obligated to use commercially reasonable efforts, consistent with its normal
trading and sales practices and as provided herein and in the applicable
Transaction Acceptance, to place Shares issued by the Company only if and when
the Company makes a Transaction Proposal to JPMS related to such an Agency
Transaction and a Transaction Acceptance related to such Agency

 

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  Transaction has been delivered to the Company by JPMS as provided in Section 2
below.

 

  (c) JPMS, as agent in any Agency Transaction, hereby covenants and agrees not
to make any sales of the Shares on behalf of the Company pursuant to this
Agreement other than (i) by means of ordinary brokers’ transactions between
members of the Exchange that qualify for delivery of a Prospectus in accordance
with Rule 153 under the Act and meet the definition of an “at the market
offering” under Rule 415(a)(4) under the Act (such transactions are hereinafter
referred to as “At the Market Offerings”) and (ii) such other sales of the
Shares on behalf of the Company in its capacity as agent of the Company as shall
be agreed by the Company and JPMS in writing.

 

  (d) JPMS will confirm in writing to the Company the number of Shares sold on
any Exchange Business Day, the related Gross Sales Price and, if Shares are to
be sold in an Agency Transaction in an At the Market Offering, the related Net
Sales Price (as each of such terms is defined in Section 2(b) below) no later
than the opening of trading on the immediately following Exchange Business Day.

 

  (e) If the Company shall default on its obligation to deliver Shares to JPMS
pursuant to the terms of any Agency Transaction or Terms Agreement, (i) the
Company shall hold JPMS harmless against any loss, claim or damage arising from
or as a result of such default by the Company and (ii) notwithstanding such
default, pay to JPMS any fee to which it would otherwise be entitled in
connection with such sale.

 

  (f) The Company acknowledges and agrees that (i) there can be no assurance
that JPMS will be successful in selling the Shares, (ii) JPMS shall incur no
liability or obligation to the Company or any other person or entity if it does
not sell Shares for any reason other than a failure by JPMS to use its
commercially reasonable efforts consistent with its normal trading and sales
practices and applicable law and regulations to sell such Shares in accordance
with the terms of this Agreement, and (iii) JPMS shall be under no obligation to
purchase Shares on a principal basis pursuant to this Agreement, except as may
otherwise be specifically agreed by JPMS and the Company in a Terms Agreement.

 

  2. Transaction Acceptances.

 

  (a)

The Company may, from time to time during the Term, propose to JPMS that they
enter into an Agency Transaction, to be executed on a specified Exchange
Business Day or over a specified period of Exchange Business Days, which
proposal shall be made to JPMS by any means permissible under Section 11 hereof
and shall set forth the information below (each, a “Transaction Proposal”). If
JPMS agrees to the terms of such proposed Transaction, then JPMS shall promptly
send to the Company by any means permissible under Section 11 hereof a notice
(each, a “Transaction Acceptance”),

 

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  confirming the agreed terms of such proposed Transaction as set forth in such
Transaction Proposal whereupon such Transaction shall become a binding agreement
between the Company and JPMS. Each Transaction Proposal shall specify:

(i)        the Exchange Business Day(s) on which the Shares subject to such
Transaction are intended to be sold (each, a “Purchase Date”);

(ii)       the maximum number of Shares that the Company intends to sell (the
“Specified Number of Shares”) on, or over the course of, such Purchase Date(s);
and

(iii)      the lowest price (if any) at which the Company is willing to sell
Shares on each such Purchase Date (each, a “Floor Price”).

The Company shall have responsibility for maintaining records with respect to
the aggregate dollar amount of Shares sold, or for otherwise monitoring the
availability of Shares for sale under the Registration Statement. In the event
that more than one Transaction Acceptance with respect to any Purchase Date(s)
is delivered by JPMS to the Company, the latest Transaction Acceptance shall
govern any sales of Shares for the relevant Purchase Date(s), except to the
extent of any action occurring pursuant to a prior Transaction Acceptance and
prior delivery to the Company of the latest Transaction Acceptance. The Company
or JPMS may, upon notice to the other party hereto by any means permissible
under Section 11 hereof, suspend or terminate the offering of the Shares;
provided, however, that such suspension or termination shall not affect or
impair the parties’ respective obligations with respect to the Shares sold
hereunder prior to the giving of such notice. Notwithstanding the foregoing, if
the terms of any Agency Transaction contemplate that Shares shall be sold on
more than one Purchase Date, then the Company and JPMS shall mutually agree to
such additional terms and conditions as they deem necessary in respect of such
multiple Purchase Dates, and such additional terms and conditions shall be set
forth in the relevant Transaction Proposal and confirmed by the relevant
Transaction Acceptance and be binding to the same extent as any other terms
contained therein.

 

  (b) JPMS’s commission shall be a percentage, not to exceed 1.50%, of the
actual sales price of the Shares (the “Gross Sales Price”) sold pursuant to this
Agreement (the Gross Sales Price less JPMS’s commission is referred to herein at
the “Net Sales Price”) and such rate of compensation shall not apply when JPMS
acts as principal, which terms will be separately agreed.

 

  (c)

Payment of the Net Sales Price for Shares sold by the Company on any Purchase
Date pursuant to a Transaction Acceptance shall be made to the Company by
federal funds wire transfer to the account of the Company, the details of which
are set forth on Schedule III hereto, against delivery of such Shares to JPMS.
Such payment and delivery shall be made at or about 10:00 a.m., local time in
New

 

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  York, New York, on the third Exchange Business Day (or such other day as may,
from time to time, become standard industry practice for settlement of such a
securities issuance) following each Purchase Date (each, a “Closing Date”).

 

  (d) If, as provided in the related Transaction Acceptance, a Floor Price has
been agreed to by the parties with respect to a Purchase Date, and JPMS
thereafter determines and notifies the Company that the Gross Sales Price for
such Transaction would not be at least equal to such Floor Price, then the
Company shall not be obligated to issue and sell through JPMS, and JPMS shall
not be obligated to place, the Shares proposed to be sold pursuant to such
Transaction on such Purchase Date.

 

  (e) Under no circumstances shall the Gross Sales Price of the Shares sold
pursuant to this Agreement and any Terms Agreements exceed the Maximum Amount.

 

  (f) If either party hereto has reason to believe that the exemptive provisions
set forth in Rule 101(c)(1) of Regulation M under the Exchange Act are not
satisfied with respect to the Shares, it shall promptly notify the other party
and sales of the Shares under this Agreement, any Transaction Acceptance or any
Terms Agreement shall be suspended until that or other exemptive provisions have
been satisfied in the judgment of each party. On or prior to the delivery of a
prospectus that is required (whether physically or through compliance with Rule
172 under the Act or any similar rule) in connection with the offering or sale
of the Shares, JPMS shall calculate the average daily trading volume (as defined
by Rule 100 of Regulation M under the Exchange Act) of the Common Stock based on
market data provided by Bloomberg L.P. or such other sources as agreed upon by
JPMS and the Company.

 

  (g) (i) If the Company wishes to issue and sell the Shares pursuant to this
Agreement but other than as set forth in Section 2(a) of this Agreement (each
such sale, a “Placement”), it will notify JPMS of the proposed terms of such
Placement. If JPMS, acting as principal, wishes to accept such proposed terms
(which it may decline to do for any reason in its sole discretion) or, following
discussions with the Company, wishes to accept amended terms, JPMS and the
Company will enter into a Terms Agreement setting forth the terms of such
Placement.

(ii) The terms set forth in a Terms Agreement will not be binding on the Company
or JPMS unless and until the Company and JPMS have each executed such Terms
Agreement accepting all of the terms of such Terms Agreement. In the event of a
conflict between the terms of this Agreement and the terms of a Terms Agreement,
the terms of such Terms Agreement will control.

 

  (h)

Each sale of the Shares to JPMS in a Placement shall be made in accordance with
the terms of this Agreement and a Terms Agreement, which will provide for the
sale of such Shares to, and the purchase thereof by, JPMS. Such Terms Agreement
may also specify certain provisions relating to the reoffering of such Shares by
JPMS. The commitment of JPMS to purchase the Shares pursuant to

 

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  any Terms Agreement shall be deemed to have been made on the basis of the
representations and warranties of the Company herein contained and shall be
subject to the terms and conditions herein set forth. Any such Terms Agreement
shall specify the number of the Shares to be purchased by JPMS pursuant thereto,
the price to be paid to the Company for such Shares, any provisions relating to
rights of, and default by, underwriters acting together with JPMS in the
reoffering of the Shares, the time and date (each such time and date being
referred to herein as a “Time of Delivery”) and the place of delivery of and
payment for such Shares.

 

  (i) The Company agrees that any offer to sell, any solicitation of an offer to
buy, or any sales of Shares or any other equity security of the Company shall
only be effected by or through JPMS on any single given day; provided, however,
that the foregoing limitation shall not apply to (i) the exercise of any option,
warrant, right or any conversion privilege set forth in the instrument governing
such security or (ii) sales solely to employees or security holders of the
Company or its subsidiaries, or to a trustee or other person acquiring such
securities for the accounts of such persons.

 

  (j) Notwithstanding any other provision of this Agreement, the Company shall
not offer, sell or deliver, or request the offer or sale, of any Shares pursuant
to this Agreement (whether in a Transaction or a Placement) and, by notice to
JPMS given by telephone (confirmed promptly by email), shall cancel any
instructions for the offer or sale of any Shares, and JPMS shall not be
obligated to, and if so notified by the Company shall not, offer or sell any
Shares, (i) during any period in which the Company’s insider trading policy, as
it exists on the date of this Agreement, would prohibit the purchases or sales
of the Company’s Common Stock by any of its officers or directors, (ii) during
any period in which the Company is in possession of material non-public
information or (iii) at any time from and including the date on which the
Company shall issue a press release containing, or shall otherwise publicly
announce, its earnings, revenues or other results of operations for a quarterly
or annual period (an “Earnings Announcement”) through and including the time
that is 24 hours after the time that the Company files a Quarterly Report on
Form 10-Q or an Annual Report on Form 10-K that includes consolidated financial
statements as of and for the same period or periods, as the case may be, covered
by such Earnings Announcement.

3.      Representations and Warranties of the Company.  The Company represents
and warrants to JPMS, on and as of (i) the date hereof, (ii) each date on which
the Company receives a Transaction Acceptance (a “Time of Acceptance”),
(iii) each Time of Sale (as defined below) and (iv) each Closing Date (each such
date listed in (i) through (iv), a “Representation Date”) that:

 

  (a)

There is no order preventing or suspending the use of the Registration Statement
or the Prospectus; the Registration Statement complied when it initially became
effective, complies as of the date hereof and, as amended or supplemented, at
each Representation Date will comply, in all material respects, with the

 

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  requirements of the Act; the conditions to the use of Form S-3 in connection
with the offering and sale of the Shares as contemplated hereby have been
satisfied; the Registration Statement meets, and the offering and sale of the
Shares as contemplated hereby comply with, the requirements of Rule 415 under
the Act (including, without limitation, Rule 415(a)(5)); the Prospectus complied
or will comply, at the time it was or will be filed with the Commission, and
will comply, as then amended or supplemented, as of each Representation Date, in
all material respects, with the requirements of the Act; the Registration
Statement did not, as of the time of its initial effectiveness, and does not or
will not, as then amended or supplemented, as of each Representation Date,
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; as of each Representation Date, the Prospectus, as then amended or
supplemented, together with all of the then issued Permitted Free Writing
Prospectuses, if any, will not contain an untrue statement of a material fact or
omit to state a material fact necessary in order to make the statements therein,
in the light of the circumstances under which they were made, not misleading;
provided, however, that the Company makes no representation or warranty with
respect to any statement contained in the Registration Statement, the Prospectus
or any Permitted Free Writing Prospectus in reliance upon and in conformity with
information concerning JPMS and furnished in writing by or on behalf of JPMS
expressly for use in the Registration Statement, the Prospectus or such
Permitted Free Writing Prospectus, which consists of the information set forth
on Schedule II hereto (the “Agent Information”). “Time of Sale” means, (i) with
respect to each offering of Shares pursuant to this Agreement, the time of
JPMS’s initial entry into contracts with investors for the sale of such Shares
and (ii) with respect to each offering of Shares pursuant to any relevant Terms
Agreement, the time of sale of such Shares.

 

  (b)

Prior to the execution of this Agreement, the Company has not, directly or
indirectly, offered or sold any of the Shares by means of any “prospectus”
(within the meaning of the Act) or used any “prospectus” (within the meaning of
the Act) in connection with the offer or sale of the Shares, in each case other
than the Basic Prospectus. The Company represents and agrees that, unless it
obtains the prior consent of JPMS, until the termination of this Agreement, it
has not made and will not make any offer relating to the Shares that would
constitute an “issuer free writing prospectus”, as defined in Rule 433 under the
Act, or that would otherwise constitute a “free writing prospectus”, as defined
in Rule 405 under the Act. Any such free writing prospectus relating to the
Shares consented to by JPMS is hereinafter referred to as a “Permitted Free
Writing Prospectus”. The Company represents that it has complied and will comply
in all material respects with the requirements of Rule 433 under the Act
applicable to any Permitted Free Writing Prospectus, including timely filing
with the Commission where required, legending and record keeping. The conditions
set forth in one or more of subclauses (i) through (iv), inclusive, of Rule
433(b)(1) under the Act are satisfied, and the registration statement relating
to the offering of the Shares contemplated hereby, as initially filed with the
Commission, includes a prospectus

 

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  that, other than by reason of Rule 433 or Rule 431 under the Act, satisfies
the requirements of Section 10 of the Act; neither the Company nor JPMS is
disqualified, by reason of subsection (f) or (g) of Rule 164 under the Act, from
using, in connection with the offer and sale of the Shares, “free writing
prospectuses” (as defined in Rule 405 under the Act) pursuant to Rules 164 and
433 under the Act; the Company is not an “ineligible issuer” (as defined in Rule
405 under the Act) as of each eligibility determination date for purposes of
Rules 164 and 433 under the Act with respect to the offering of the Shares
contemplated by the Registration Statement.

 

  (c) The Incorporated Documents, when they were filed with the Commission,
conformed in all material respects to the requirements of the Act or the
Exchange Act, as applicable, and none of such documents 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, in light of the
circumstances under which they were made, not misleading; and any further
documents so filed and incorporated by reference in the Registration Statement,
the Prospectus or any Permitted Free Writing Prospectus, when such documents
become effective or are filed with the Commission, as the case may be, will
conform in all material respects to the requirements of the Act or the Exchange
Act, as applicable.

 

  (d) The consolidated financial statements of the Company and its subsidiaries
and the related notes thereto included or incorporated by reference in the
Registration Statement, the Prospectus and any Permitted Free Writing Prospectus
comply in all material respects with the applicable requirements of the Act and
the Exchange Act, as applicable, and present fairly the financial position of
the Company and its consolidated subsidiaries as of the dates indicated and the
results of their operations and the changes in their cash flows for the periods
specified; such financial statements have been prepared in conformity with
generally accepted accounting principles (“GAAP”) applied on a consistent basis
throughout the periods covered thereby, except as otherwise disclosed in the
financial statement footnotes, and the supporting schedules included or
incorporated by reference in the Registration Statement, the Prospectus and any
Permitted Free Writing Prospectus present fairly the information required to be
stated therein; the other financial information included or incorporated by
reference in the Registration Statement, the Prospectus and any Permitted Free
Writing Prospectus has been derived from the accounting records of the Company
and its subsidiaries and presents fairly the information shown thereby; and any
pro forma financial information and the related notes thereto included or
incorporated by reference in the Registration Statement, the Prospectus and any
Permitted Free Writing Prospectus have been prepared in accordance with the
applicable requirements of the Act and the Exchange Act, as applicable, and the
assumptions underlying such pro forma financial information are reasonable and
are included or incorporated by reference in the Registration Statement, the
Prospectus and any such Permitted Free Writing Prospectus.

 

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  (e) Since the date of the most recent financial statements of the Company
included or incorporated by reference in the Registration Statement, the
Prospectus and any Permitted Free Writing Prospectus, (i) no material change in
the capital stock or long-term debt of the Company or any of its subsidiaries
has occurred, (ii) no dividend or distribution of any kind has been declared,
set aside for payment, paid or made by the Company on any class of capital
stock, (iii) there has not been any material adverse change, nor any development
that would reasonably be expected to have a material adverse change, in or
affecting the business, properties, management, financial position, results of
operations or prospects of the Company and its subsidiaries, taken as a whole,
(iv) neither the Company nor any of its subsidiaries has entered into any
transaction or agreement that is material to the Company and its subsidiaries,
taken as a whole, or incurred any liability or obligation, direct or contingent,
that is material to the Company and its subsidiaries, taken as a whole, and
(v) neither the Company nor any of its subsidiaries has sustained any loss or
interference with its business from fire, explosion, flood or other calamity,
whether or not covered by insurance, or from any labor disturbance or dispute or
any action, order or decree of any court or arbitrator or governmental or
regulatory authority that, in the case of this clause (v), individually or in
the aggregate, has had or would reasonably be expected to have a Material
Adverse Effect (as defined in Section 3(f)), except, in each case (i) through
(v), as otherwise disclosed in the Registration Statement, the Prospectus or any
Permitted Free Writing Prospectus.

 

  (f) The Company and each of its Identified Subsidiaries (as defined below)
have been duly organized and are validly existing and in good standing under the
laws of their respective jurisdictions of organization, are duly qualified to do
business and are in good standing in each jurisdiction in which their respective
ownership or lease of property or the conduct of their respective businesses
requires such qualification, and have all power and authority necessary to own
or hold their respective properties and to conduct the businesses in which they
are engaged, except where the failure to be so qualified, in good standing or
have such power or authority would not, individually or in the aggregate, have a
material adverse effect on the business, properties, management, financial
position, results of operations or prospects of the Company and its subsidiaries
taken as a whole (a “Material Adverse Effect”). As used in this Agreement,
“Identified Subsidiary” means the subsidiaries listed in Schedule I to this
Agreement. The Company does not have any significant subsidiaries that are not
listed on Schedule I hereto.

 

  (g)

The Company has an authorized capitalization as set forth in the Registration
Statement, the Prospectus and any Permitted Free Writing Prospectus; all the
outstanding shares of capital stock of the Company have been duly and validly
authorized and issued and are fully paid and non-assessable and are not subject
to any pre-emptive or similar rights; except as described in or expressly
contemplated by the Registration Statement, the Prospectus or any Permitted Free
Writing Prospectus, there are no outstanding rights (including, without
limitation, pre-emptive rights), warrants or options to acquire, or instruments
convertible into or exchangeable for, any shares of capital stock or other
equity interests in the

 

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  Company or any of its subsidiaries, nor any contracts, commitments,
agreements, understandings or arrangements of any kind relating to the issuance
of any capital stock of the Company or any such subsidiary, any such convertible
or exchangeable securities or any such rights, warrants or options; the capital
stock of the Company conforms in all material respects to the description
thereof contained in the Registration Statement, the Prospectus and any
Permitted Free Writing Prospectus; and all the outstanding shares of capital
stock or other equity interests of each Identified Subsidiary of the Company
have been duly and validly authorized and issued, are fully paid and
non-assessable (except, in the case of any foreign subsidiary, for directors’
qualifying shares) and are owned directly or indirectly by the Company, free and
clear of any lien, charge, encumbrance, security interest, restriction on voting
or transfer or any other claim of any third party (except as otherwise described
in the Registration Statement, the Prospectus or any Permitted Free Writing
Prospectus).

 

  (h) The Company has full right, power and authority to execute and deliver
this Agreement and any Terms Agreement and perform its obligations hereunder or
thereunder; and all action required to be taken for the due and proper
authorization, execution and delivery by it of this Agreement and any Terms
Agreement and the consummation by it of the transactions contemplated hereby and
thereby has been duly and validly taken (or, in the case of any Terms Agreement,
such action will have been duly and validly authorized), subject, in the case of
the issuance and sale of Shares, to the delivery of a Transaction Proposal by
the persons specified in the resolutions of the pricing committee of the
Company’s board of directors.

 

  (i) This Agreement has been, and any Terms Agreement will have been, duly
authorized, executed and delivered by the Company.

 

  (j) This Agreement conforms in all material respects to the description
thereof contained in the Registration Statement, the Prospectus and any
Permitted Free Writing Prospectus.

 

  (k) The Shares to be issued and sold by the Company hereunder or under any
Terms Agreement have been duly authorized by the Company and, when issued and
delivered and paid for as provided herein or in any Terms Agreement, will be
duly and validly issued, will be fully paid and nonassessable and will conform
to the description thereof in the Registration Statement, the Prospectus, and
any Permitted Free Writing Prospectus; the Shares and all other shares of
outstanding capital stock of the Company conform to the description thereof
contained in the Registration Statement, the Prospectus and any Permitted Free
Writing Prospectus; and the shareholders of the Company do not have any
preemptive or similar rights with respect to the Shares.

 

  (l)

Neither the Company nor any of its subsidiaries is (i) in violation of its
charter or by-laws or similar organizational documents; (ii) in default, and no
event has occurred that, with notice or lapse of time or both, would constitute
such a

 

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  default, in the due performance or observance of any term, covenant or
condition contained in any indenture, mortgage, deed of trust, loan agreement or
other agreement or instrument to which the Company or any of its subsidiaries is
a party or by which the Company or any of its subsidiaries is bound or to which
any of the property or assets of the Company or any of its subsidiaries is
subject; or (iii) in violation of any law or statute or any judgment, order,
rule or regulation of any court or arbitrator or governmental or regulatory
authority, except, in the case of clauses (ii) and (iii) above, for any such
default or violation that would not reasonably be expected, individually or in
the aggregate, to have a Material Adverse Effect.

 

  (m) The execution, delivery and performance by the Company of this Agreement
or any Terms Agreement, the issuance and sale of the Shares, the compliance by
the Company with the terms hereof or of any Terms Agreement and the consummation
of the transactions contemplated hereby or by any Terms Agreement will not
(i) conflict with or result in a breach or violation of any of the terms or
provisions of, or constitute a default under, or result in the creation or
imposition of any lien, charge or encumbrance upon any property or assets of the
Company or any of its subsidiaries pursuant to, any indenture, mortgage, deed of
trust, loan agreement or other agreement or instrument to which the Company or
any of its subsidiaries is a party or by which the Company or any of its
subsidiaries is bound or to which any of the property or assets of the Company
or any of its subsidiaries is subject, (ii) result in any violation of the
provisions of the charter or by-laws or similar organizational documents of the
Company or any of its Identified Subsidiaries or (iii) result in the violation
of any law or statute or any judgment, order, rule or regulation of any court or
arbitrator or governmental or regulatory authority, except, in the case of
clauses (i) and (iii) above, for any such conflict, breach, violation or default
that would not reasonably be expected, individually or in the aggregate, to have
a Material Adverse Effect.

 

  (n) No consent, approval, authorization, order, registration or qualification
of or with any court or arbitrator or governmental or regulatory authority is
required for the execution, delivery and performance by the Company of this
Agreement or any Terms Agreement, the issuance and sale of the Shares and
compliance by the Company with the terms hereof or of any Terms Agreement and
the consummation of the transactions contemplated hereby or by any Terms
Agreement, except for those that have been obtained and for the registration of
the Shares under the Act and such consents, approvals, authorizations, orders
and registrations or qualifications as may be required under applicable state
securities laws.

 

  (o)

Except as described in the Registration Statement, the Prospectus or any
Permitted Free Writing Prospectus, there are no legal, governmental or
regulatory investigations, actions, suits or proceedings pending to which the
Company or any of its subsidiaries is a party or to which any property of the
Company or any of its subsidiaries is the subject that, individually or in the
aggregate, would reasonably be expected to have a Material Adverse Effect; to
the best knowledge of the

 

11

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  Company, no such investigations, actions, suits or proceedings are threatened
or contemplated by any governmental or regulatory authority or threatened by
others; and (i) there are no current or pending legal, governmental or
regulatory actions, suits or proceedings that are required under the Act to be
described in the Registration Statement or the Prospectus that are not so
described in the Registration Statement or the Prospectus and (ii) there are no
statutes, regulations or contracts or other documents that are required under
the Act to be filed as exhibits to the Registration Statement or described in
the Registration Statement or the Prospectus that are not so filed as exhibits
to the Registration Statement or described in the Registration Statement or the
Prospectus.

 

  (p) Ernst & Young LLP, who have audited certain consolidated financial
statements of the Company and its subsidiaries are independent public
accountants with respect to the Company and its subsidiaries within the
applicable rules and regulations adopted by the Commission and the Public
Company Accounting Oversight Board (United States) and as required by the Act.

 

  (q) The Company and its subsidiaries have good and marketable title in fee
simple to, or have valid rights to lease or otherwise use, all items of real and
personal property that are material to the businesses of the Company and its
subsidiaries, taken as a whole, in each case free and clear of all liens,
encumbrances, claims and defects and imperfections of title except those that
(i) do not materially interfere with the use made and proposed to be made of
such property by the Company and its subsidiaries, (ii) are disclosed in the
Registration Statement, the Prospectus or any Permitted Free Writing Prospectus
or (iii) would not reasonably be expected, individually or in the aggregate, to
have a Material Adverse Effect.

 

  (r) The Company and its subsidiaries own or possess adequate rights to use all
material patents, patent applications, trademarks, service marks, trade names,
trademark registrations, service mark registrations, copyrights, licenses and
know-how (including trade secrets and other unpatented and/or unpatentable
proprietary or confidential information, systems or procedures) necessary for
the conduct, in all material respects, of their businesses, taken as a whole;
and the conduct of their businesses, taken as a whole, will not conflict in any
material respect with any such rights of others, and the Company and its
subsidiaries have not received any notice of any material claim of infringement
or conflict with any such rights of others.

 

  (s) No relationship, direct or indirect, exists between or among the Company
or any of its subsidiaries, on the one hand, and the directors, officers,
stockholders or other affiliates of the Company or any of its subsidiaries, on
the other, that is required by the Act to be described in the Registration
Statement or the Prospectus and that is not so described in such documents.

 

  (t)

Neither the Company nor any of its subsidiaries is, and after giving effect to
the offering and sale of the Shares and the application of the proceeds thereof
as described in the Registration Statement, the Prospectus or any Permitted Free

 

12

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  Writing Prospectus, will not be an “investment company” or an entity
“controlled” by an “investment company” within the meaning of the Investment
Company Act of 1940, as amended, and the rules and regulations of the Commission
thereunder.

 

  (u) The Company and its subsidiaries have filed all federal, state, local and
foreign tax returns required to be filed or have requested extensions of the
filing deadlines therefore, except in any case where the failure to so file
would not reasonably be expected to have a Material Adverse Effect; the Company
and its subsidiaries have paid all federal, state, local and foreign taxes
required to be paid through the date hereof, except any such taxes that are
being contested in good faith by appropriate proceedings and for which the
Company, to the extent required by GAAP, has set aside on its books adequate
reserves, except for any inadequate reserves that would not, individually or in
the aggregate, have a Material Adverse Effect; and except as otherwise disclosed
in the Registration Statement, the Prospectus or any Permitted Free Writing
Prospectus, there is no tax deficiency that has been, or would reasonably be
expected to be, asserted against the Company or any of its subsidiaries or any
of their respective properties or assets, except those as would not,
individually or in the aggregate, have a Material Adverse Effect.

 

  (v) The Company and its subsidiaries possess all licenses, certificates,
permits and other authorizations issued by, and have made all declarations and
filings with, the appropriate federal, state, local or foreign governmental or
regulatory authorities that are necessary for the ownership or lease of their
respective properties or the conduct of their respective businesses as described
in the Registration Statement, the Prospectus and any Permitted Free Writing
Prospectus, except where the failure to possess or make the same would not
reasonably be expected, individually or in the aggregate, to have a Material
Adverse Effect; and except as described in the Registration Statement, the
Prospectus or any Permitted Free Writing Prospectus, neither the Company nor any
of its subsidiaries has received notice of any revocation or modification of any
such license, certificate, permit or authorization or has any reason to believe
that any such license, certificate, permit or authorization will not be renewed
in the ordinary course, except where such revocation, modification or renewal
would not reasonably be expected, individually or in the aggregate, to have a
Material Adverse Effect.

 

  (w) Except as described in the Registration Statement, Prospectus or any
Permitted Free Writing Prospectus, no labor disturbance by or dispute with
employees of the Company or any of its subsidiaries exists or, to the knowledge
of the Company, is contemplated or threatened, except for those as would not
reasonably be expected, individually or in the aggregate, to have a Material
Adverse Effect.

 

  (x)

(i) Except as described in the Registration Statement, the Prospectus or any
Permitted Free Writing Prospectus, the Company and its subsidiaries (A) are, and
at all prior times were, in compliance with any and all applicable federal,
state,

 

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  local and foreign laws, rules, regulations, requirements, decisions and orders
relating to the protection of human health or safety, the environment, natural
resources, hazardous or toxic substances or wastes, pollutants or contaminants
(collectively, “Environmental Laws”), (B) have received and are in compliance
with all permits, licenses, certificates or other authorizations or approvals
required of them under applicable Environmental Laws to conduct their respective
businesses, and (C) have not received notice of any actual or potential
liability under or relating to any Environmental Laws, including for the
investigation or remediation of any disposal or release of hazardous or toxic
substances or wastes, pollutants or contaminants, and have no knowledge of any
event or condition that would reasonably be expected to result in any such
notice, and (ii) except as described in the Registration Statement, the
Prospectus or any Permitted Free Writing Prospectus, there are no costs or
liabilities associated with Environmental Laws of or relating to the Company or
its subsidiaries, except in the case of each of (i) and (ii) above, for any such
failure to comply, or failure to receive required permits, licenses or
approvals, or cost or liability, as would not reasonably be expected,
individually or in the aggregate, to have a Material Adverse Effect.

 

  (y) (i) Each employee benefit plan, within the meaning of Section 3(3) of the
Employee Retirement Income Security Act of 1974, as amended (“ERISA”), for which
the Company or any member of its “Controlled Group” (defined as any organization
which is a member of a controlled group of corporations within the meaning of
Section 414 of the Internal Revenue Code of 1986, as amended (the “Code”)) would
have any liability (each, a “Plan”) has been maintained in material compliance
with its terms and the requirements of any applicable statutes, orders, rules
and regulations, including but not limited to ERISA and the Code; (ii) no
prohibited transaction, within the meaning of Section 406 of ERISA or
Section 4975 of the Code, has occurred with respect to any Plan excluding
transactions effected pursuant to a statutory or administrative exemption;
(iii) for each Plan that is subject to the funding rules of Section 412 of the
Code or Section 302 of ERISA, no “accumulated funding deficiency” as defined in
Section 412 of the Code, whether or not waived, has occurred or is reasonably
expected to occur; (iv) the fair market value of the assets of each Plan exceeds
the present value of all benefits accrued under such Plan (determined based on
those assumptions used to fund such Plan), except for any liability as would
not, individually or in the aggregate, reasonably be expected to have a Material
Adverse Effect; (v) no “reportable event” (within the meaning of Section 4043(c)
of ERISA) has occurred or is reasonably expected to occur, except for any
reportable event as would not, individually or in the aggregate, reasonably be
expected to have a Material Adverse Effect; and (vi) neither the Company nor any
member of its Controlled Group has incurred, nor reasonably expects to incur,
any liability under Title IV of ERISA (other than contributions to the Plan or
premiums to the Pension Benefit Guaranty Corporation, in the ordinary course and
without default) in respect of a Plan (including a “multiemployer plan”, within
the meaning of Section 4001(a)(3) of ERISA), except for any liability as would
not, individually or in the aggregate, reasonably be expected to have a Material
Adverse Effect.

 

14

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  (z) The Company maintains an effective system of “disclosure controls and
procedures” (as defined in Rule 13a-15(e) of the Exchange Act) that is designed
to ensure that information required to be disclosed by the Company in reports
that it files or submits under the Exchange Act is recorded, processed,
summarized and reported within the time periods specified in the Commission’s
rules and forms, including controls and procedures designed to ensure that such
information is accumulated and communicated to the Company’s management as
appropriate to allow timely decisions regarding required disclosure. The Company
has carried out evaluations of the effectiveness of its disclosure controls and
procedures as required by Rule 13a-15 of the Exchange Act.

 

  (aa) The Company maintains systems of “internal control over financial
reporting” (as defined in Rule 13a-15(f) of the Exchange Act) that comply with
the requirements of the Exchange Act and have been designed by, or under the
supervision of, the Company’s principal executive and principal financial
officers, or persons performing similar functions, to provide reasonable
assurance regarding the reliability of financial reporting and the preparation
of financial statements for external purposes in accordance with GAAP,
including, but not limited to, internal accounting controls sufficient to
provide reasonable assurance that (i) transactions are executed in accordance
with management’s general or specific authorizations; (ii) transactions are
recorded as necessary to permit preparation of financial statements in
conformity with GAAP and to maintain asset accountability; (iii) access to
assets is permitted only in accordance with management’s general or specific
authorization; (iv) interactive data in eXtensible Business Reporting Language
(“XBRL Data”) included or incorporated by reference in the Registration
Statement fairly presents the information called for in all material respects
and is prepared in accordance with the Commission’s rules and guidelines
applicable thereto; and (v) the recorded accountability for assets is compared
with the existing assets at reasonable intervals and appropriate action is taken
with respect to any differences. Except as disclosed in the Registration
Statement, the Prospectus or any Permitted Free Writing Prospectus, there are no
material weaknesses in the Company’s internal control over financial reporting.

 

  (bb) The Registration Statement and the documents incorporated by reference
therein include and incorporate by reference all XBRL Data required to be
included therein; and the XBRL Data included or incorporated by reference in the
Registration Statement or the documents incorporated by reference therein fairly
presents the information called for in all material respects and has been
prepared in accordance with the Commission’s rules and guidelines applicable
thereto.

 

  (cc)

The Company and its subsidiaries have insurance covering their respective
properties, operations, personnel and businesses, including business
interruption insurance, which insurance is in amounts and insures against such
losses and risks as the Company believes in its reasonable judgment are adequate
to protect the Company and its subsidiaries and their respective businesses; and
neither the Company nor any of its subsidiaries has (i) received notice from any
insurer or agent of such insurer that capital improvements or other expenditures
are required

 

15

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  or necessary to be made in order to continue such insurance or (ii) any reason
to believe that it will not be able to renew its existing insurance coverage as
and when such coverage expires or to obtain similar coverage at reasonable cost
from similar insurers as may be necessary to continue its business, except where
such notice or non-renewal would not reasonably be expected to have a Material
Adverse Effect.

 

  (dd) Neither the Company nor any of its subsidiaries nor, to the knowledge of
the Company, any director, officer, employee, agent, affiliate or other person
associated with or acting on behalf of the Company or any of its subsidiaries
has (i) used any funds for any unlawful contribution, gift, entertainment or
other unlawful expense relating to political activity; (ii) made or taken an act
in furtherance of an offer, promise or authorization of any direct or indirect
unlawful payment or benefit to any foreign or domestic government or regulatory
official or employee, including of any government-owned or controlled entity or
of a public international organization, or any person acting in an official
capacity for or on behalf of any of the foregoing, or any political party or
party official or candidate for political office; (iii) violated or is in
violation of any provision of the Foreign Corrupt Practices Act of 1977, as
amended, or any applicable law or regulation implementing the OECD Convention on
Combating Bribery of Foreign Public Officials in International Business
Transactions, or committed an offence under any other applicable anti-bribery or
anti-corruption laws; or (iv) made, offered, agreed, requested or taken an act
in furtherance of any unlawful bribe or other unlawful benefit, including,
without limitation, any rebate, payoff, influence payment, kickback or other
unlawful or improper payment or benefit. The Company and its subsidiaries have
instituted, maintain and enforce, and will continue to maintain and enforce
policies and procedures designed to promote and ensure compliance with all
applicable anti-bribery and anti-corruption laws.

 

  (ee) The operations of the Company and its subsidiaries are and have been
conducted at all times in compliance with applicable financial recordkeeping and
reporting requirements, including those of the Currency and Foreign Transactions
Reporting Act of 1970, as amended, the applicable money laundering statutes of
all jurisdictions where the Company or any of its subsidiaries conducts
business, the rules and regulations thereunder and any related or similar rules,
regulations or guidelines issued, administered or enforced by any governmental
or regulatory agency (collectively, the “Anti-Money Laundering Laws”) and no
action, suit or proceeding by or before any court or governmental or regulatory
agency, authority or body or any arbitrator involving the Company or any of its
subsidiaries with respect to the Anti-Money Laundering Laws is pending or, to
the knowledge of the Company, threatened.

 

  (ff)

Neither the Company nor any of its subsidiaries, nor, to the knowledge of the
Company, any director, officer, or employee, agent, or affiliate or other person
associated with or acting on behalf of the Company or any of its subsidiaries is
currently the subject or the target of any sanctions administered or enforced by
the U.S. government, (including, without limitation, the Office of Foreign
Assets

 

16

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  Control of the U.S. Department of the Treasury (“OFAC”) or the U.S. Department
of State and including, without limitation, the designation as a “specially
designated national” or “blocked person”), the United Nations Security Council,
the European Union, Her Majesty’s Treasury, or other relevant sanctions
authority (collectively, “Sanctions”), nor is the Company, any of its
subsidiaries located, organized or resident in a country or territory that is
the subject or the target of Sanctions, including, without limitation, Cuba,
Burma (Myanmar), Iran, North Korea, Sudan, Syria and Crimea (each, a “Sanctioned
Country”); and the Company will not directly or indirectly use the proceeds of
the offering of the Shares hereunder, or lend, contribute or otherwise make
available such proceeds to any subsidiary, joint venture partner or other person
or entity (i) to fund or facilitate any activities of or business with any
person that, at the time of such funding or facilitation, is the subject or the
target of Sanctions, (ii) to fund or facilitate any activities of or business in
any Sanctioned Country or (iii) in any other manner that will result in a
violation by any person (including any person participating in the transaction,
whether as underwriter, advisor, investor or otherwise) of Sanctions. For the
past five years, the Company and its subsidiaries have not knowingly engaged in,
are not now knowingly engaged in, and will not engage in, any dealings or
transactions with any person that at the time of the dealing or transaction is
or was the subject or the target of Sanctions or with any Sanctioned Country.

 

  (gg) No subsidiary of the Company is currently prohibited, directly or
indirectly, under any agreement or other instrument to which it is a party or is
subject, from paying any dividends to the Company, from making any other
distribution on such subsidiary’s capital stock, from repaying to the Company
any loans or advances to such subsidiary from the Company or from transferring
any of such subsidiary’s properties or assets to the Company or any other
subsidiary of the Company, except, in each case, as described in the
Registration Statement, the Prospectus or any Permitted Free Writing Prospectus.

 

  (hh) Neither the Company nor any of its subsidiaries is a party to any
contract, agreement or understanding with any person (other than this Agreement)
that would reasonably be expected to give rise to a valid claim against the
Company or any of its subsidiaries or JPMS for a brokerage commission, finder’s
fee or like payment in connection with the offering and sale of the Shares.

 

  (ii) No person has the right to require the Company or any of its subsidiaries
to register any securities for sale under the Act by reason of the filing of the
Registration Statement with the Commission or the issuance and sale of the
Shares.

 

  (jj) The Company has not taken, directly or indirectly, any action designed to
or that would reasonably be expected to cause or result in any stabilization or
manipulation of the price of the Shares.

 

17

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  (kk) Neither the issuance, sale and delivery of the Shares nor the application
of the proceeds thereof by the Company as described in the Registration
Statement, the Prospectus and any Permitted Free Writing Prospectus will violate
Regulation T, U or X of the Board of Governors of the Federal Reserve System or
any other regulation of such Board of Governors.

 

  (ll) No forward-looking statement (within the meaning of Section 27A of the
Act and Section 21E of the Exchange Act) included or incorporated by reference
in the Registration Statement, the Prospectus or any Permitted Free Writing
Prospectus has been made or reaffirmed without a reasonable basis or has been
disclosed other than in good faith.

 

  (mm) Nothing has come to the attention of the Company that has caused the
Company to believe that the statistical and market-related data included or
incorporated by reference in the Registration Statement, the Prospectus and any
Permitted Free Writing Prospectus is not based on or derived from sources that
are reliable and accurate in all material respects.

 

  (nn) There is and has been no failure on the part of the Company or any of the
Company’s directors or officers, in their capacities as such, to comply with any
provision of the Sarbanes-Oxley Act of 2002 and the rules and regulations
promulgated in connection therewith, including Section 402 related to loans and
Sections 302 and 906 related to certifications.

 

  (oo) The Company is not an “ineligible issuer” and is a “well-known seasoned
issuer”, in each case as defined under the Act and at the times specified in the
Act in connection with the offering of the Shares. The Company has paid the
registration fee for this offering pursuant to Rule 457 under the Act.

 

  (pp) The Common Stock is registered pursuant to Section 12(b) of the Exchange
Act, and the Company has taken no action designed to, or likely to have the
effect of, terminating the registration of the Common Stock under the Exchange
Act or delisting the Common Stock from the Exchange nor has the Company received
any notification that the Commission or the Exchange is contemplating
terminating such registration or listing. The outstanding shares of the Common
Stock have been approved for listing and the Shares being sold hereunder have
been approved for listing, subject only to official notice of issuance, on the
Exchange.

 

  (qq) There are no transfer taxes or other similar fees or charges under
federal law or the laws of any state, or any political subdivision thereof,
required to be paid in connection with the execution and delivery of this
Agreement or the issuance and sale by the Company of the Shares.

 

  (rr) The Common Stock is an “actively-traded security” excepted from the
requirements of Rule 101 of Regulation M under the Exchange Act by subsection
(c)(1) of such rule.

 

18

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  (ss) Any certificate signed by any officer of the Company or any subsidiary of
the Company delivered to JPMS or to counsel for JPMS pursuant to or in
connection with this Agreement shall be deemed a representation and warranty by
the Company to JPMS as to the matters covered thereby.

4.      Certain Covenants of the Company.  The Company hereby agrees with JPMS:

 

  (a) For so long as the delivery of a prospectus is required (whether
physically or through compliance with Rule 172 under the Act or any similar
rule) in connection with the offering or sale of the Shares, before amending or
supplementing the Registration Statement or the Prospectus (in each case, other
than due to the filing of an Incorporated Document), (i) to furnish to JPMS a
copy of each such proposed amendment or supplement within a reasonable period of
time before filing any such amendment or supplement with the Commission,
(ii) that the Company will not use or file any such proposed amendment or
supplement to which JPMS reasonably objects, unless the Company’s legal counsel
has advised the Company that filing such document is required by law, and
(iii) that the Company will not use or file any Permitted Free Writing
Prospectus to which JPMS reasonably objects.

 

  (b) To prepare a Prospectus Supplement, with respect to any Shares sold by the
Company pursuant to this Agreement in a form previously approved by JPMS and to
file such Prospectus Supplement pursuant to Rule 424(b) under the Act (and
within the time periods required by Rule 424(b) and Rules 430A, 430B or 430C
under the Act) and to file any Permitted Free Writing Prospectus to the extent
required by Rule 433 under the Act and to provide copies of the Prospectus and
such Prospectus Supplement and each Permitted Free Writing Prospectus (to the
extent not previously delivered or filed on the Commission’s Electronic Data
Gathering, Analysis and Retrieval system or any successor system thereto
(collectively, “EDGAR”)) to JPMS via e-mail in “.pdf” format on such filing date
to an e-mail account designated by JPMS and, at JPMS’s request, to also furnish
copies of the Prospectus and such Prospectus Supplement to each exchange or
market on which sales were effected as may be required by the rules or
regulations of such exchange or market.

 

  (c)

To file promptly all reports and any definitive proxy or information statements
required to be filed by the Company with the Commission pursuant to
Sections 13(a), 13(c), 14 or 15(d) of the Exchange Act for so long as the
delivery of a prospectus is required (whether physically or through compliance
with Rule 172 under the Act or any similar rule) in connection with the offering
or sale of the Shares, and during such same period to advise JPMS, promptly
after the Company receives notice thereof, (i) of the time when any amendment to
the Registration Statement has been filed or has become effective or any
supplement to the Prospectus, any Permitted Free Writing Prospectus or any
amended Prospectus has been filed with the Commission, (ii) of the issuance by
the Commission of any stop order or any order preventing or suspending the use
of any prospectus relating to the Shares or the initiation or threatening of any

 

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  proceeding for that purpose, pursuant to Section 8A of the Act, (iii) of any
objection by the Commission to the use of Form S-3ASR by the Company pursuant to
Rule 401(g)(2) under the Act, (iv) of the suspension of the qualification of the
Shares for offering or sale in any jurisdiction, of the initiation or
threatening of any proceeding for any such purpose, (v) of any request by the
Commission for the amendment of the Registration Statement or the amendment or
supplementation of the Prospectus or for additional information, (vi) of the
occurrence of any event as a result of which the Prospectus or any Permitted
Free Writing Prospectus as then amended or supplemented includes any untrue
statement of a material fact or omits to state a material fact required to be
stated therein or necessary in order to make the statements therein, in the
light of the circumstances existing when the Prospectus or any such Permitted
Free Writing Prospectus is delivered to a purchaser, not misleading and (vii) of
the receipt by the Company of any notice of objection of the Commission to the
use of the Registration Statement or any post-effective amendment thereto.

 

  (d) In the event of the issuance of any such stop order or of any such order
preventing or suspending the use of any such prospectus or suspending any such
qualification, to use promptly its commercially reasonable efforts to obtain its
withdrawal.

 

  (e) To furnish such information as may be required and otherwise to cooperate
in qualifying the Shares for offering and sale under the securities or blue sky
laws of such states as JPMS may reasonably designate and to maintain such
qualifications in effect so long as required for the distribution of the Shares;
provided that the Company shall not be required to qualify as a foreign
corporation, become a dealer of securities, or become subject to taxation in, or
to consent to the service of process under the laws of, any such state.

 

  (f) To make available to JPMS at its offices in New York City, without charge,
as soon as practicable after the Registration Statement becomes effective, and
thereafter from time to time to furnish to JPMS, as many copies of the
Prospectus and the Prospectus Supplement (or of the Prospectus or Prospectus
Supplement as amended or supplemented if the Company shall have made any
amendments or supplements thereto and documents incorporated by reference
therein after the effective date of the Registration Statement) and each
Permitted Free Writing Prospectus as JPMS may reasonably request for so long as
the delivery of a prospectus is required (whether physically or through
compliance with Rule 172 under the Act or any similar rule); and for so long as
this Agreement is in effect, the Company will prepare and file promptly such
amendment or amendments to the Registration Statement, the Prospectus or any
Permitted Free Writing Prospectus as may be necessary to comply with the
requirements of Section 10(a)(3) of the Act.

 

  (g)

To furnish or make available to JPMS during the term of this Agreement and for a
period of two years thereafter (i) copies of any reports or other communications
which the Company shall send to its stockholders or shall from time to time

 

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  publish or publicly disseminate and (ii) copies of all annual, quarterly and
current reports filed with the Commission on Forms 10-K, 10-Q and 8-K, or such
other similar form as may be designated by the Commission, and to furnish to
JPMS from time to time during the term of this Agreement such other information
as JPMS may reasonably request regarding the Company or its subsidiaries, in
each case as soon as such reports, communications, documents or information
becomes available or promptly upon the request of JPMS, as applicable; provided,
however, that the Company shall have no obligation to provide JPMS with any
document filed on EDGAR or included on the Company’s Internet website.

 

  (h) If, at any time during the term of this Agreement, any event shall occur
or condition shall exist as a result of which it is necessary in the reasonable
opinion of counsel for JPMS or counsel for the Company, to further amend or
supplement the Prospectus or any Free Writing Prospectus as then amended or
supplemented in order that the Prospectus or any such Free Writing Prospectus
will not include an untrue statement of a material fact or omit to state any
material fact required to be stated therein or necessary in order to make the
statements therein not misleading, in light of the circumstances existing at the
time the Prospectus or any such Free Writing Prospectus is delivered to a
purchaser, or if it shall be necessary, in the reasonable opinion of either such
counsel, to amend or supplement the Registration Statement, the Prospectus or
any Free Writing Prospectus in order to comply with the requirements of the Act,
in the case of such a determination by counsel for the Company, immediate notice
shall be given, and confirmed in writing, to JPMS to cease the solicitation of
offers to purchase the Shares in JPMS’s capacity as agent, and, in either case,
the Company will promptly prepare and file with the Commission such amendment or
supplement, whether by filing documents pursuant to the Act, the Exchange Act or
otherwise, as may be necessary to correct such untrue statement or omission or
to make the Registration Statement, the Prospectus or any such Free Writing
Prospectus comply with such requirements.

 

  (i) To generally make available to its security holders as soon as reasonably
practicable, but not later than 90 days after the close of the period covered
thereby, an earnings statement (in a form complying with the provisions of
Section 11(a) under the Act and Rule 158 of the Commission promulgated
thereunder) covering the twelve-month period beginning not later than the first
day of the Company’s fiscal quarter next following the “effective date” (as
defined in such Rule 158) of the Registration Statement.

 

  (j) To apply the net proceeds from the sale of the Shares in the manner
described in the Registration Statement or the Prospectus under the caption “Use
of Proceeds”.

 

  (k)

The Company will not, and will cause its subsidiaries not to, take, directly or
indirectly, any action designed to cause or result in, or that constitutes or
might reasonably be expected to constitute, the stabilization or manipulation of
the price of any security of the Company to facilitate the sale or resale of the
Shares; provided that nothing herein shall prevent the Company from filing or
submitting

 

21

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  reports under the Exchange Act or issuing press releases in the ordinary
course of business.

 

  (l) (i) Except as otherwise agreed between the Company and JPMS, to pay all
costs, expenses, fees and taxes in connection with (A) the preparation and
filing of the Registration Statement (including registration fees pursuant to
Rule 456(b)(1)(i) under the Act), the Prospectus, any Permitted Free Writing
Prospectus and any amendments or supplements thereto, and the printing and
furnishing of copies of each thereof to JPMS and to dealers (including costs of
mailing and shipment), (B) the registration, issue and delivery of the Shares,
(C) the preparation, printing and delivery to JPMS of this Agreement, the
Shares, and such other documents as may be required in connection with the
offer, purchase, sale, issuance or delivery of the Shares and any cost
associated with electronic delivery of any of the foregoing by JPMS to
investors, (D) the qualification of the Shares for offering and sale under state
laws and the determination of their eligibility for investment under state law
as aforesaid (including the reasonable legal fees and filing fees and other
disbursements of counsel for JPMS in connection therewith) and the printing and
furnishing of copies of any blue sky surveys or legal investment surveys to
JPMS, (E) the listing of the Shares on the Exchange and any registration thereof
under the Exchange Act, (F) any filing for review of the public offering of the
Shares by FINRA, (G) the fees and disbursements of counsel to the Company and
(H) the performance of the Company’s other obligations hereunder; provided that
JPMS shall be responsible for any transfer taxes on resale of Shares by it, any
costs and expenses associated with the sale and marketing of the Shares and fees
of its counsel other than as specifically provided above or elsewhere in this
Agreement.

(ii) If Shares having an aggregate Gross Sales Price of $100,000,000 or more
have not been offered and sold under this Agreement and all Terms Agreements by
December 31, 2015 (or such earlier date at which the Company terminates this
Agreement), the Company shall reimburse JPMS for all of its out-of-pocket
expenses, including the reasonable fees and disbursements of a single counsel
for JPMS incurred by it in connection with the offering contemplated by this
Agreement; provided that the Company will not be obligated to reimburse any
expenses pursuant to this clause 4(l)(ii) in excess of $350,000.

 

  (m) The Company will not, and JPMS covenants that it will not, distribute any
offering material in connection with the offer and sale of the Shares, other
than the Registration Statement, the Prospectus, any Permitted Free Writing
Prospectus and other materials permitted by the Act or the rules and regulations
promulgated thereunder.

 

  (n)

During each period commencing on the date of each Transaction Proposal and
ending after the close of business on the Purchase Date for the related
Transaction, the Company will not (i) offer, pledge, announce the intention to
sell, sell, contract to sell, sell any option or contract to purchase, purchase
any option or contract to sell, grant any option, right or warrant to purchase
or otherwise

 

22

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  transfer or dispose of, directly or indirectly, any shares of its Common Stock
or any securities convertible into, or exercisable or exchangeable for, such
shares or (ii) enter into any swap or other agreement that transfers, in whole
or in part, any of the economic consequences of ownership of such shares,
whether any such transaction described in clause (i) or (ii) above is to be
settled by delivery of shares or such other securities, in cash or otherwise,
without the prior written consent of JPMS, other than the Shares to be sold
hereunder and any securities of the Company issued pursuant to, or upon the
exercise or conversion of any securities of the Company that are outstanding at
the time such Transaction Proposal is delivered and issued pursuant to, the
Company’s equity incentive plans disclosed in the Prospectus.

 

  (o) The Company will, pursuant to reasonable procedures developed in good
faith, retain copies of each Permitted Free Writing Prospectus that is not filed
with the Commission in accordance with Rule 433 under the Act.

 

  (p) To use its reasonable efforts to cause the Shares to be listed on the
Exchange.

 

  (q) That it consents to JPMS trading in the Common Stock for JPMS’s own
account and for the account of its clients at the same time as sales of the
Shares occur pursuant to this Agreement.

 

  (r) If immediately prior to the third anniversary (the “Renewal Deadline”) of
the initial effective date of the Registration Statement, the aggregate Gross
Sales Price of Shares sold by the Company is less than the Maximum Amount and
this Agreement has not expired or been terminated, the Company will, prior to
the Renewal Deadline, file, if it has not already done so and is eligible to do
so, a new automatic shelf registration statement relating to the Shares, in a
form satisfactory to the Agent. If the Company is no longer eligible to file an
automatic shelf registration statement, the Company will, prior to the Renewal
Deadline, if it has not already done so, file a new shelf registration statement
relating to the Shares, in a form satisfactory to the Agent, and will use its
best efforts to cause such registration statement to be declared effective
within 60 days after the Renewal Deadline. The Company will take all other
action necessary or appropriate to permit the issuance and sale of the Shares to
continue as contemplated in the expired registration statement relating to the
Shares. References herein to the Registration Statement shall include such new
automatic shelf registration statement or such new shelf registration statement,
as the case may be.

5.       Execution of Agreement.  JPMS’s obligation to execute this Agreement
shall be subject to the satisfaction of the following conditions in connection
with, and on the intended date of the execution of, this Agreement:

 

  (a) the Company shall have delivered to JPMS:

(i)        an officer’s certificate signed by one of its executive officers
certifying as to the matters set forth in Exhibit A hereto;

 

23

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(ii)       an opinion of the General Counsel or a Deputy or Assistant General
Counsel of the Company, addressed to JPMS and dated the date of this Agreement,
in the form of Exhibit B hereto;

(iii)      an opinion and a 10b-5 statement of Jones Walker LLP, special counsel
for the Company, addressed to JPMS and dated the date of this Agreement, in the
form of Exhibit C hereto;

(iv)      a letter of Ernst & Young LLP, dated the date of this Agreement and
addressed to JPMS, in a form reasonably satisfactory to JPMS and its counsel;

(v)       evidence reasonably satisfactory to JPMS and its counsel that the
Registration Statement has become effective;

(vi)      evidence reasonably satisfactory to JPMS and its counsel that the
Shares have been approved for listing on the Exchange, subject only to notice of
issuance on or before the date hereof;

(vii)     resolutions duly adopted by the Company’s board of directors, and
certified by an officer of the Company, authorizing the Company’s execution of
this Agreement and the consummation by the Company of the transactions
contemplated hereby, including the issuance of the Shares; and

(viii)    such other documents as JPMS shall reasonably request; and

 

  (b) JPMS shall have received the favorable opinion of Cravath, Swaine & Moore
LLP, special counsel for JPMS, as to the matters set forth in Exhibit D hereto.

6.       Additional Covenants of the Company.  The Company further covenants and
agrees with JPMS as follows:

 

  (a) Each Transaction Proposal made by the Company that is accepted by JPMS by
means of a Transaction Acceptance and each execution and delivery by the Company
of a Terms Agreement shall be deemed to be (i) an affirmation that the
representations and warranties of the Company herein contained and contained in
any certificate delivered to JPMS pursuant hereto are true and correct at the
Time of Acceptance or the date of such Terms Agreement, as the case may be, and
(ii) an undertaking that such representations and warranties will be true and
correct on any Time of Sale, any Closing Date and at the time of delivery to
JPMS of Shares pursuant to the Transaction Proposal and Transaction Acceptance
or the Time of Delivery, as applicable, as though made at and as of each such
time (it being understood that such representations and warranties shall relate
to the Registration Statement, the Prospectus or any Permitted Free Writing
Prospectus as amended and supplemented to the time of such Transaction
Acceptance or Terms Agreement, as the case may be).

 

24

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  (b) Each time that (i) the Registration Statement, the Prospectus or any
Permitted Free Writing Prospectus shall be amended or supplemented (including,
except as noted in the proviso at the end of this subsection (b), by the filing
of any Incorporated Document, but excluding any prospectus supplement filed
pursuant to Section 4(b) hereof) or (ii) the Shares are delivered to JPMS
pursuant to a Terms Agreement, in each case, the Company shall, unless JPMS
agrees otherwise, furnish or cause to be furnished to JPMS forthwith a
certificate, dated the date of filing with the Commission or the date of
effectiveness of such amendment or supplement, as applicable, as to the matters
set forth in Exhibit A hereto at the time of the filing or effectiveness of such
amendment or supplement, as applicable, as though made at and as of such time
(except that such statements shall be deemed to relate to the Registration
Statement, the Prospectus or any Permitted Free Writing Prospectus as amended
and supplemented to such time) or, in lieu of such certificate, a certificate of
the same tenor as the certificate referred to in Section 5(a)(i) hereof,
modified as necessary to relate to the Registration Statement, the Prospectus or
any Permitted Free Writing Prospectus as amended and supplemented to the time of
delivery of such certificate; provided, however, that the Company will not be
required to furnish such a certificate to JPMS in connection with the filing of
a Current Report on Form 8-K unless (A) such Current Report on Form 8-K is filed
at any time during which either a Transaction Acceptance is binding or a
prospectus relating to the Shares is required to be delivered under the Act and
(B) JPMS has reasonably requested such a certificate based upon the event or
events reported in such Current Report on Form 8-K.

 

  (c)

Each time that (i) the Registration Statement, the Prospectus or any Permitted
Free Writing Prospectus shall be amended or supplemented (including, except as
noted in the proviso at the end of this subsection (c), by the filing of any
Incorporated Document, but excluding any prospectus supplement filed pursuant to
Section 4(b) hereof) or (ii) the Shares are delivered to JPMS pursuant to a
Terms Agreement, in each case, the Company shall, unless JPMS agrees otherwise,
furnish or cause to be furnished forthwith to JPMS and to counsel for JPMS the
written opinions of (A) Jones Walker LLP, special counsel for the Company, and
(B) the General Counsel of the Company, a Deputy or Assistant General Counsel of
the Company or other counsel satisfactory to JPMS, dated the date of filing with
the Commission or the date of effectiveness of such amendment or supplement, as
applicable, in form and substance reasonably satisfactory to JPMS, of the same
tenor as the opinions referred to in Section 5(a)(iii) and Section 5(a)(ii)
hereof, respectively, but modified as necessary to relate to the Registration
Statement, the Prospectus or any Permitted Free Writing Prospectus as amended
and supplemented to the time of delivery of such opinions or, in lieu of such
opinions, counsel last furnishing such opinions to JPMS shall furnish JPMS with
letters substantially to the effect that JPMS may rely on such last opinions to
the same extent as though they were dated the date of such letters authorizing
reliance (except that statements in such last opinions shall be deemed to relate
to the Registration Statement, the Prospectus or any Permitted Free Writing
Prospectus as amended and supplemented to the time of delivery of

 

25

--------------------------------------------------------------------------------

  such letters authorizing reliance); provided, however, that the Company will
not be required to furnish such opinions to JPMS in connection with the filing
of a Current Report on Form 8-K unless (1) such Current Report on Form 8-K is
filed at any time during which either a Transaction Acceptance is binding or a
prospectus relating to the Shares is required to be delivered under the Act and
(2) JPMS has reasonably requested such opinions based upon the event or events
reported in such Current Report on Form 8-K.

 

  (d) Each time that (i) the Registration Statement, the Prospectus or any
Permitted Free Writing Prospectus shall be amended or supplemented (including,
except as noted in the proviso at the end of this subsection (d), by the filing
of any Incorporated Document, but excluding any prospectus supplement filed
pursuant to Section 4(b) hereof) or (ii) the Shares are delivered to JPMS
pursuant to a Terms Agreement, in each case, the Company shall, unless JPMS
agrees otherwise, cause Ernst & Young LLP promptly to furnish to JPMS a letter,
dated the date of filing with the Commission or the date of effectiveness of
such amendment or supplement, as applicable, of the same tenor as the letter
referred to in Section 5(a)(iv) hereof, but modified to relate to the
Registration Statement, the Prospectus or any Permitted Free Writing Prospectus
as amended and supplemented to the date of such letter; provided, however, that
the Company will not be required cause Ernst & Young LLP to furnish such letter
to JPMS in connection with the filing of a Current Report on Form 8-K unless
(A) such Current Report on Form 8-K is filed at any time during which either a
Transaction Acceptance is binding or a prospectus relating to the Shares is
required to be delivered under the Act and (B) JPMS has reasonably requested
such a letter based upon the event or events reported in such Current Report on
Form 8-K.

 

  (e) To disclose in its quarterly reports on Form 10-Q, in its annual report on
Form 10-K and/or, in prospectus supplements, the number of the Shares sold
through JPMS under this Agreement, the net proceeds to the Company from the sale
of the Shares and the compensation paid by the Company with respect to sales of
the Shares pursuant to this Agreement during the relevant quarter.

 

  (f) The Company shall reasonably cooperate with any reasonable due diligence
review requested by JPMS or its counsel from time to time in connection with the
transactions contemplated hereby or any Terms Agreement.

7.       Conditions of JPMS’s Obligation.  JPMS’s obligation to solicit
purchases on an agency basis for the Shares or otherwise take any action
pursuant to a Transaction Acceptance and to purchase the Shares pursuant to any
Terms Agreement shall be subject to the satisfaction of the following
conditions:

 

  (a) At the Time of Acceptance, at the time of the commencement of trading on
the Exchange on the Purchase Date and at the time of closing on the Closing Date
or, with respect to a transaction pursuant to a Terms Agreement, at the Time of
Sale and at the Time of Delivery:

 

26

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(i)        The representations and warranties on the part of the Company herein
contained or contained in any certificate of an officer or officers of the
Company delivered pursuant to the provisions hereof shall be true and correct in
all respects.

(ii)       The Company shall have performed and observed its covenants and other
obligations hereunder and/or under any Terms Agreement, as the case may be, in
all material respects.

(iii)      With respect to an Agency Transaction, from the Time of Acceptance
until the Closing Date, or, with respect to a transaction pursuant to a Terms
Agreement, from the Time of Sale until the Time of Delivery, trading in the
Common Stock on the Exchange shall not have been suspended.

(iv)      From the date of this Agreement, no event or condition of a type
described in Section 3(e) hereof shall have occurred or shall exist, which event
or condition is not described in any Permitted Free Writing Prospectus
(excluding any amendment or supplement thereto) or the Prospectus (excluding any
amendment or supplement thereto) and the effect of which in the judgment of JPMS
makes it impracticable or inadvisable to proceed with the offering, sale or
delivery of the Shares on the Closing Date or at the Time of Delivery, as the
case may be, on the terms and in the manner contemplated by this Agreement or
any Terms Agreement, as the case may be, any Permitted Free Writing Prospectus
and the Prospectus.

(v)       The Shares to be issued pursuant to the Transaction Acceptance or
pursuant to a Terms Agreement, as applicable, shall have been approved for
listing on the Exchange, subject only to notice of issuance.

(vi)      (A) No action shall have been taken and no statute, rule, regulation
or order shall have been enacted, adopted or issued by any federal, state or
foreign governmental or regulatory authority that would, as of the Closing Date
or as of the Time of Delivery, as the case may be, prevent the issuance or sale
of the Shares and (B) no injunction or order of any federal, state or foreign
court shall have been issued that would, as of the Closing Date or as of the
Time of Delivery, as the case may be, prevent the issuance or sale of the
Shares.

(vii)     (A) No order suspending the effectiveness of the Registration
Statement shall be in effect, and no proceeding for such purpose or pursuant to
Section 8A under the Act shall be pending before or threatened by the
Commission; (B) the Prospectus and each Permitted Free Writing Prospectus shall
have been timely filed with the Commission under the Act (in the case of any
Permitted Free Writing Prospectus, to the extent required by Rule 433 under the
Act); (C) all requests by the Commission for additional information shall have
been complied with to the satisfaction of JPMS; and (D) no suspension of the
qualification of the Shares for offering or sale in any jurisdiction, and no
initiation

 

27

--------------------------------------------------------------------------------

or threatening of any proceedings for any of such purposes, will have occurred
and be in effect at the time of a Transaction Acceptance.

(viii)    No amendment or supplement to the Registration Statement, the
Prospectus or any Permitted Free Writing Prospectus shall have been filed to
which JPMS shall have reasonably objected in writing.

(ix)      Subsequent to the relevant Time of Acceptance or, in the case of a
Placement, subsequent to execution of the applicable Terms Agreement, (A) no
downgrading shall have occurred in the rating accorded any debt securities or
preferred equity securities of or guaranteed by the Company or any of its
subsidiaries by any “nationally recognized statistical rating organization”, as
such term is defined by the Commission for purposes of Section 3(a)(62) of the
Exchange Act and (B) no such organization shall have publicly announced that it
has under surveillance or review, or has changed its outlook with respect to,
its rating of any debt securities or preferred equity securities of or
guaranteed by the Company or any of its subsidiaries (other than an announcement
with positive implications of a possible upgrading) in each case that has not
been described in any Permitted Free Writing Prospectus issued prior to any
related Time of Sale.

 

  (b) At every date specified in Sections 6(b), 6(c) and 6(d) hereof and on such
other dates as reasonably requested by JPMS, JPMS shall have received the
officer’s certificates, opinions of counsel and accountants’ letters provided
for under Sections 6(b), 6(c) and 6(d), respectively.

8.       Termination by JPMS.  If the solicitation of purchases on an agency
basis of the Shares, as contemplated by this Agreement, is not carried out by
JPMS for any reason permitted under this Agreement or if such sale is not
carried out because the Company is unable to comply in all material respects
with any of the terms of this Agreement or any Terms Agreement, the Company
shall not be under any obligation or liability under this Agreement (except to
the extent provided in Sections 4(l) and 10 hereof) and JPMS shall be under no
obligation or liability to the Company under this Agreement (except to the
extent provided in Section 10 hereof) or to one another hereunder.

JPMS may terminate this Agreement for any reason upon giving prior written
notice to the Company. Any such termination shall be without liability of any
party to any other party, except that the provisions of Sections 4(g) and 4(i)
(to the extent any Shares have been sold pursuant to this Agreement) and
Sections 4(l) and 10 hereof shall remain in full force and effect
notwithstanding such termination.

In the case of any purchase by JPMS pursuant to a Terms Agreement, the
obligations of JPMS pursuant to such Terms Agreement shall be subject to
termination at any time at or prior to the Time of Delivery, if, (a) since the
time of execution of the Terms Agreement or the respective dates as of which
information is given in the Registration Statement, the Prospectus and any
Permitted Free Writing Prospectus, (i) trading generally shall have been
materially suspended or materially limited on or by, as the case may be, either
the Exchange or the NASDAQ Global Select Market, (ii) trading of any securities
of the Company shall have been

 

28

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suspended on any exchange or in any over-the counter market, (iii) a general
moratorium on commercial banking activities in New York shall have been declared
by either Federal or New York State authorities, (iv) there shall have occurred
any attack on, or outbreak or escalation of hostilities or act of terrorism
involving, the United States, or any change in financial markets or any calamity
or crisis that, in each case, in JPMS’s judgment, is material and adverse or
(v) any material disruption of settlements of securities or clearance services
in the United States that would materially impair settlement and clearance with
respect to the Shares and (b) in the case of any of the events specified in
clauses (a)(i) through (v), such event singly or together with any other such
event specified in clauses (a)(i) through (v) makes it, in JPMS’s judgment,
impracticable to market the Shares on the terms and in the manner contemplated
in the Prospectus. If JPMS elects to terminate its obligations pursuant to this
paragraph, the Company shall be notified promptly in writing.

9.       Termination by Company.  The Company may terminate this Agreement in
its sole discretion at any time upon prior written notice to JPMS.

10.     Indemnity and Contribution.

 

  (a) The Company agrees to indemnify and hold harmless JPMS, its affiliates,
directors and officers and each person, if any, who controls JPMS within the
meaning of Section 15 of the Act or Section 20 of the Exchange Act, from and
against any and all losses, claims, damages and liabilities (including, without
limitation, reasonable out of pocket legal fees and other expenses incurred in
connection with any suit, action or proceeding or any claim asserted, as such
fees and expenses are incurred) that arise out of, or are based upon, (i) any
untrue statement or alleged untrue statement of a material fact contained in the
Registration Statement or caused by any omission or alleged omission to state
therein a material fact required to be stated therein or necessary in order to
make the statements therein not misleading or (ii) any untrue statement or
alleged untrue statement of a material fact contained in the Prospectus (or any
amendment or supplement thereto), any Permitted Free Writing Prospectus (or any
amendment or supplement thereto) or caused by any omission or alleged omission
to state therein a material fact necessary in order to make the statements
therein, in light of the circumstances under which they were made, not
misleading, in each case except insofar as such losses, claims, damages or
liabilities arise out of, or are based upon, any untrue statement or omission or
alleged untrue statement or omission made in reliance upon and in conformity
with any Agent Information, it being understood and agreed that the only such
information furnished by JPMS consists of the information described as such in
subsection (b) below.

 

  (b)

JPMS agrees to indemnify and hold harmless the Company, its directors, its
officers who signed the Registration Statement and each person, if any, who
controls the Company within the meaning of Section 15 of the Act or Section 20
of the Exchange Act to the same extent as the indemnity set forth in paragraph
(a) above, but only with respect to any losses, claims, damages or liabilities
that arise out of, or are based upon, any untrue statement or omission or
alleged untrue statement or omission made in reliance upon and in conformity
with any

 

29

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  information relating to JPMS furnished to the Company in writing by JPMS
expressly for use in the Registration Statement, the Basic Prospectus, the
Prospectus (or any amendment or supplement thereto) or any Permitted Free
Writing Prospectus, it being understood and agreed that the only such
information furnished by JPMS consists of the information set forth on
Schedule II attached hereto.

 

  (c)

If any suit, action, proceeding (including any governmental or regulatory
investigation), claim or demand shall be brought or asserted against any person
in respect of which indemnification may be sought pursuant to either paragraph
(a) or (b) above, such person (the “Indemnified Person”) shall promptly notify
the person against whom such indemnification may be sought (the “Indemnifying
Person”) in writing; provided that the failure to notify the Indemnifying Person
shall not relieve it from any liability that it may have under this Section 10
except to the extent that it has been materially prejudiced (through the
forfeiture of substantive rights or defenses) by such failure; and provided,
further, that the failure to notify the Indemnifying Person shall not relieve it
from any liability that it may have to an Indemnified Person otherwise than
under this Section 10. If any such proceeding shall be brought or asserted
against an Indemnified Person and it shall have notified the Indemnifying Person
thereof, the Indemnifying Person shall retain counsel reasonably satisfactory to
the Indemnified Person (who shall not, without the consent of the Indemnified
Person, be counsel to the Indemnifying Person) to represent the Indemnified
Person and any others entitled to indemnification pursuant to this Section 10
that the Indemnifying Person may designate in such proceeding and shall pay the
fees and expenses of such counsel related to such proceeding, as incurred. In
any such proceeding, any Indemnified Person shall have the right to retain its
own counsel, but the fees and expenses of such counsel shall be at the expense
of such Indemnified Person unless (i) the Indemnifying Person and the
Indemnified Person shall have mutually agreed to the contrary; (ii) the
Indemnifying Person has failed within a reasonable time to retain counsel
reasonably satisfactory to the Indemnified Person; (iii) the Indemnified Person
shall have reasonably concluded that there may be legal defenses available to it
that are different from or in addition to those available to the Indemnifying
Person; or (iv) the named parties in any such proceeding (including any
impleaded parties) include both the Indemnifying Person and the Indemnified
Person and representation of both parties by the same counsel would be
inappropriate due to actual or potential differing interests between them. It is
understood and agreed that the Indemnifying Person shall not, in connection with
any proceeding or related proceeding in the same jurisdiction, be liable for the
fees and expenses of more than one separate firm (in addition to any local
counsel) for all Indemnified Persons, and that all such fees and expenses shall
be paid or reimbursed as they are incurred. Any such separate firm for JPMS, its
affiliates, directors and officers and any control persons of JPMS shall be
designated in writing by JPMS and any such separate firm for the Company, its
directors, its officers who signed the Registration Statement and any control
persons of the Company shall be designated in writing by the Company. The
Indemnifying Person shall not be liable for any settlement of any proceeding

 

30

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  effected without its written consent, but, if settled with such consent or if
there be a final judgment for the plaintiff, the Indemnifying Person agrees to
indemnify each Indemnified Person from and against any loss or liability by
reason of such settlement or judgment. Notwithstanding the foregoing sentence,
if at any time an Indemnified Person shall have requested that an Indemnifying
Person reimburse the Indemnified Person for fees and expenses of counsel as
contemplated by this paragraph, the Indemnifying Person shall be liable for any
settlement of any proceeding effected without its written consent if (A) such
settlement is entered into more than 30 days after receipt by the Indemnifying
Person of such request and (B) the Indemnifying Person shall not have reimbursed
the Indemnified Person in accordance with such request prior to the date of such
settlement. No Indemnifying Person shall, without the written consent of the
Indemnified Person, effect any settlement of any pending or threatened
proceeding in respect of which any Indemnified Person is or could have been a
party and indemnification could have been sought hereunder by such Indemnified
Person, unless such settlement (x) includes an unconditional release of such
Indemnified Person, in form and substance reasonably satisfactory to such
Indemnified Person, from all liability on claims that are the subject matter of
such proceeding and (y) does not include any statement as to or any admission of
fault, culpability or a failure to act by or on behalf of any Indemnified
Person.

 

  (d) If the indemnification provided for in paragraphs (a) and (b) above is
unavailable to an Indemnified Person or insufficient in respect of any losses,
claims, damages or liabilities referred to therein, then each Indemnifying
Person under such paragraph, in lieu of indemnifying such Indemnified Person
thereunder, shall contribute to the amount paid or payable by such Indemnified
Person as a result of such losses, claims, damages or liabilities (i) in such
proportion as is appropriate to reflect the relative benefits received by the
Company, on the one hand, and JPMS, on the other, from the offering of the
Shares or (ii) if the allocation provided by clause (i) is not permitted by
applicable law, in such proportion as is appropriate to reflect not only the
relative benefits referred to in clause (i) but also the relative fault of the
Company, on the one hand, and JPMS, on the other, in connection with the
statements or omissions that resulted in such losses, claims, damages or
liabilities, as well as any other relevant equitable considerations. The
relative benefits received by the Company, on the one hand, and JPMS, on the
other, shall be deemed to be in the same respective proportions as the net
proceeds (before deducting expenses) received by the Company from the sale of
the Shares and the total underwriting discounts and commissions received by JPMS
in connection therewith bear to the aggregate Gross Sales Price. The relative
fault of the Company, on the one hand, and JPMS, on the other, 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 or by JPMS, and
the parties’ relative intent, knowledge, access to information and opportunity
to correct or prevent such statement or omission.

 

31

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  (e) The Company and JPMS agree that it would not be just and equitable if
contribution pursuant to this Section 10 were determined by pro rata allocation
or by any other method of allocation that does not take account of the equitable
considerations referred to in paragraph (d) above. The amount paid or payable by
an Indemnified Person as a result of the losses, claims, damages and liabilities
referred to in paragraph (d) above shall be deemed to include, subject to the
limitations set forth above, any legal or other expenses incurred by such
Indemnified Person in connection with any such action or claim. Notwithstanding
the provisions of this Section 10, in no event shall JPMS be required to
contribute any amount in excess of the amount by which the total underwriting
discounts and commissions received by JPMS with respect to the offering of the
Shares exceeds the amount of any damages that JPMS 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.

 

  (f) The remedies provided for in this Section 10 are not exclusive and shall
not limit any rights or remedies which may otherwise be available to any
Indemnified Person at law or in equity.

11.     Notices.  All notices and other communications under this Agreement and
any Terms Agreement shall be in writing and shall be deemed to have been duly
given if mailed or transmitted and confirmed by any standard form of
communication, and, if to JPMS, shall be sufficient in all respects if delivered
or sent to J.P. Morgan Securities LLC, 383 Madison Avenue, 7th Floor, New York,
New York 10179, to the attention of the Special Equities Group, Adam Rosenbluth
(email adam.s.rosenbluth@jpmorgan.com) and Brett Chalmers (email
brett.chalmers@jpmorgan.com), and, if to the Company, shall be sufficient in all
respects if delivered or sent to the Company at the offices of the Company at
333 North Central Avenue, Phoenix, Arizona 85004, to the attention of the Chief
Financial Officer (email kathleen_quirk@fmi.com), with a copy to Dionne M.
Rousseau at Jones Walker LLP, 8555 United Plaza Boulevard, 5th Floor, Baton
Rouge, Louisiana 70809 (email drousseau@joneswalker.com). Notwithstanding the
foregoing, Transaction Proposals shall be delivered to JPMS via e-mail in “.pdf”
format to Adam Rosenbluth (email adam.s.rosenbluth@jpmorgan.com), Brett Chalmers
(email brett.chalmers@jpmorgan.com), Jemil Salih (email
jemil.d.salih@jpmorgan.com) and Ara Movsesian (email
ara.movsesian@jpmorgan.com), and Transaction Acceptances shall be delivered to
the Company via e-mail in “.pdf” format to Kathleen L. Quirk
(kathleen_quirk@fmi.com), with copies to Dionne M. Rousseau
(drousseau@joneswalker.com) and Monique A. Cenac (mcenac@joneswalker.com).

12.     No Fiduciary Relationship.  The Company acknowledges and agrees that
JPMS is acting solely in the capacity of an arm’s length contractual
counterparty to the Company with respect to the offering of Shares contemplated
hereby (including in connection with determining the terms of the offering) and
not as a financial advisor or a fiduciary to, or an agent of, the Company or any
other person. Additionally, JPMS is not advising the Company or any other person
as to any legal, tax, investment, accounting or regulatory matters in any
jurisdiction. The

 

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Company shall consult with its own advisors concerning such matters and shall be
responsible for making its own independent investigation and appraisal of the
transactions contemplated hereby, and JPMS shall have no responsibility or
liability to the Company with respect thereto. Any review by JPMS of the
Company, the transactions contemplated hereby or other matters relating to such
transactions will be performed solely for the benefit of JPMS and shall not be
on behalf of the Company.

13.     Governing Law; Construction.  This Agreement, any Terms Agreement and
any claim, counterclaim or dispute of any kind or nature whatsoever arising out
of or in any way relating to this Agreement or any Terms Agreement (“Claim”),
directly or indirectly, shall be governed by, and construed in accordance with,
the laws of the State of New York, other than rules governing choice of
applicable law. The Section headings in this Agreement and any Terms Agreement
have been inserted as a matter of convenience of reference and are not a part of
this Agreement or any Terms Agreement.

14.     Submission to Jurisdiction.  Except as set forth below, no Claim may be
commenced, prosecuted or continued in any court other than the courts of the
State of New York located in the City and County of New York or in the United
States District Court for the Southern District of New York, which courts shall
have exclusive jurisdiction over the adjudication of such matters, and the
Company consents to the jurisdiction of such courts and personal service with
respect thereto. Each of JPMS and the Company, on its behalf and, to the extent
permitted by applicable law, on behalf of its stockholders and affiliates,
waives all right to trial by jury in any action, proceeding or counterclaim,
whether based upon contract, tort or otherwise, in any way arising out of or
relating to this Agreement or any Terms Agreement. The Company agrees that a
final and non-appealable judgment in any such action, proceeding or counterclaim
brought in any such court shall be conclusive and binding upon the Company and
may be enforced in any other courts in the jurisdiction of which the Company is
or may be subject, by suit upon such judgment.

15.     Parties in Interest.  The agreements set forth herein and in any Terms
Agreement have been and are made solely for the benefit of JPMS and the Company
and, to the extent provided in Section 10 hereof, the controlling persons,
directors and officers referred to in such section, and their respective
successors, assigns, heirs, personal representatives and executors and
administrators. No other person, partnership, association or corporation
(including a purchaser, as such purchaser, from JPMS) shall acquire or have any
right under or by virtue of this Agreement or any Terms Agreement.

16.     Counterparts.  This Agreement and any Terms Agreement may be signed in
counterparts (which may include counterparts delivered by any standard form of
telecommunication), each of which shall be an original and all of which together
shall constitute one and the same instrument.

17.     Successors and Assigns.  This Agreement shall be binding upon JPMS and
the Company and their respective successors and assigns and any successor or
assign of any substantial portion of the Company’s and JPMS’s respective
businesses and/or assets.

 

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18.     Survival.  The respective indemnities, rights of contribution,
representations, warranties and agreements of the Company and JPMS contained in
this Agreement or made by or on behalf of the Company or JPMS pursuant to this
Agreement or any certificate delivered pursuant hereto shall survive the
delivery of and payment for the Shares and shall remain in full force and
effect, regardless of any termination of this Agreement or any investigation
made by or on behalf of the Company or JPMS.

19.     Certain Defined Terms.  For purposes of this Agreement, (a) except where
otherwise expressly provided, the term “affiliate” has the meaning set forth in
Rule 405 under Act and (b) the term “significant subsidiary” has the meaning set
forth in Rule 1-02 of Regulation S-X under the Exchange Act.

20.     Amendments or Waivers.  No amendment or waiver of any provision of this
Agreement, nor any consent or approval to any departure therefrom, shall in any
event be effective unless the same shall be in writing and signed by the parties
hereto.

21.     Miscellaneous.  JPMS, an indirect, wholly owned subsidiary of JPMorgan
Chase & Co., is not a bank and is separate from any affiliated bank, including
any U.S. branch or agency of JPMorgan Chase Bank. Because JPMS is a separately
incorporated entity, it is solely responsible for its own contractual
obligations and commitments, including obligations with respect to sales and
purchases of securities. Securities sold, offered or recommended by JPMS are not
deposits, are not insured by the Federal Deposit Insurance Corporation, are not
guaranteed by a branch or agency of JPMorgan Chase Bank and are not otherwise an
obligation or responsibility of a branch or agency of JPMorgan Chase Bank.

A lending affiliate of JPMS may have lending relationships with issuers of
securities underwritten or privately placed by JPMS. To the extent required
under the securities laws, prospectuses and other disclosure documents for
securities underwritten or privately placed by JPMS will disclose the existence
of any such lending relationships and whether the proceeds of the issue will be
used to repay debts owed to affiliates of JPMS.

JPMS and one or more of its affiliates may make markets in the Common Stock or
other securities of the Company, in connection with which they may buy and sell,
as agent or principal, for long or short account, shares of the Common Stock or
other securities of the Company, at the same time that JPMS is acting as agent
pursuant to this Agreement; provided that JPMS acknowledges and agrees that any
such transactions are not being, and shall not be deemed to have been,
undertaken at the request or direction of, or for the account of, the Company,
and that the Company has and shall have no control over any decision by JPMS and
its affiliates to enter into any such transactions.

 

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If the foregoing correctly sets forth the understanding between the Company and
JPMS, please so indicate in the space provided below for the purpose, whereupon
this letter and your acceptance shall constitute a binding agreement between the
Company and JPMS.

 

    Very truly yours,     FREEPORT-MCMORAN INC.     By:  

   /s/ Kathleen L. Quirk

    Name:   Kathleen L. Quirk     Title:  

Executive Vice President, Chief Financial

Officer and Treasurer

Accepted and agreed to as of the
date first above written:     J.P. MORGAN SECURITIES LLC     By:  

/s/ Adam S. Rosenbluth

   

Name:   Adam S. Rosenbluth       Title:   Executive Director