Exhibit 10.1
STOCKHOLDER AGREEMENT
     This STOCKHOLDER AGREEMENT, dated as of December 30, 2010 (this
“Agreement”), is entered into by and between Plains Exploration & Production
Company, a Delaware corporation (“PXP”), and McMoRan Exploration Co., a Delaware
corporation (“McMoRan”). McMoRan and PXP are sometimes referred to collectively
as the “Parties” and individually as a “Party.”
RECITALS
     WHEREAS, McMoRan, McMoRan Oil & Gas LLC, a Delaware limited liability
company, McMoRan GOM, LLC, a Delaware limited liability company, McMoRan
Offshore LLC, a Delaware limited liability company, PXP, PXP Gulf Properties
LLC, a Delaware limited liability company (“PXP Gulf”), and PXP Offshore LLC, a
Delaware limited liability company (“PXP Offshore”), have entered into that
certain Agreement and Plan of Merger (the “Merger Agreement”), dated as of
September 19, 2010, pursuant to which McMoRan will acquire PXP Gulf and PXP
Offshore in exchange for cash and shares of common stock, par value $0.01 per
share, of McMoRan (the “McMoRan Common Stock”); and
     WHEREAS, to induce PXP to enter into the Merger Agreement and to consummate
the transactions contemplated thereby, McMoRan is required to deliver this
Agreement, duly executed by McMoRan, to PXP contemporaneously with the closing
of the transactions contemplated by the Merger Agreement; and
     WHEREAS, McMoRan believes it to be in the best interests of McMoRan and its
stockholders, and PXP believes it to be in the best interests of PXP and its
stockholders, to have certain agreements in respect of PXP’s right to designate
members of the board of directors of McMoRan (the “Board”) pursuant to the terms
of this Agreement; and
     WHEREAS, the Board has unanimously authorized and approved this Agreement
and determined that this Agreement and the transactions contemplated hereby are
in the best interests of McMoRan and its stockholders;
     NOW, THEREFORE, in consideration of the mutual covenants and agreements set
forth herein and for good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged by each Party hereto, the Parties
hereby agree as follows:
AGREEMENT
Section 1. Defined Terms. The following capitalized terms, as used in this
Agreement, shall have the meanings set forth below. Capitalized terms used but
not otherwise defined herein shall have the meanings ascribed thereto in the
Merger Agreement.
     “Agreement” shall have the meaning specified in the introductory paragraph
of this Agreement.

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     “Beneficially Own,” “Beneficial Owner” and “Beneficial Ownership” mean
ownership of securities as a “Beneficial Owner” under Rule 13d-3 under the
Exchange Act.
     “Board” shall have the meaning specified in the Recitals to this Agreement.
     “Designated Director” shall have the meaning specified in Section 2(a) of
this Agreement.
     “McMoRan” shall have the meaning specified in the introductory paragraph of
this Agreement.
     “McMoRan Charter” means the Amended and Restated Certificate of
Incorporation of McMoRan, as in effect on the date hereof.
     “McMoRan Common Stock” shall have the meaning specified in the Recitals to
this Agreement.
     “Merger Agreement” shall have the meaning specified in the Recitals to this
Agreement.
     “NYSE” means the New York Stock Exchange.
     “Party” or “Parties” shall have the meaning specified in the introductory
paragraph of this Agreement.
     “PXP” shall have the meaning specified in the introductory paragraph of
this Agreement.
     “PXP Credit Agreement” means the Amended and Restated Credit Agreement
dated August 3, 2010 between PXP, as borrower, JPMorgan Chase Bank, N.A., as
administrative agent and the lenders and agents from time to time party thereto.
     “PXP Gulf” shall have the meaning specified in the Recitals of this
Agreement.
     “PXP Offshore” shall have the meaning specified in the Recitals of this
Agreement.
     “Resignation Event” means, with respect to a Designated Director, that such
Designated Director, as determined by the Board in good faith following
compliance with the procedures set forth below in this definition when
applicable, (A) is prohibited or disqualified from serving as a director of
McMoRan under any rule or regulation of the SEC or NYSE or by applicable law;
(B) has engaged in acts or omissions constituting a breach of such Designated
Director’s duty of loyalty to McMoRan or its stockholders; (C) has engaged in
any transaction involving McMoRan from which such Designated Director derived an
improper personal benefit; or (D) has engaged in acts or omissions which involve
intentional misconduct, intentional violation of law or crimes of moral
turpitude.
     “Transfer” shall have the meaning specified in Section 6(a) of this
Agreement.

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Section 2. Director Designation Rights.
          (a) On or prior to the date hereof, the Board has adopted resolutions
that (i) increase the number of individuals that constitute the whole Board by
two persons, and (ii) resolved to fill the newly-created directorships,
effective as of the date hereof, with individuals designated by PXP (each, a
“Designated Director”). Each time the Board appoints a Designated Director, it
will also adopt resolutions such that each Designated Director (a) qualifies as
a “Continuing Director” for purposes of the indenture governing McMoRan’s
11.875% Senior Notes due 2014 and (b) will not be in the class of persons
serving on the Board that could result in (x) a “Change of Control” as defined
clause (iii) of the definition thereof in McMoRan’s indenture governing its
5-1/4% Convertible Senior Notes due 2011, (y) a “Change in Control” as defined
on clause (b) of the definition thereof in McMoRan’s Amended and Restated Credit
Agreement dated as of August 6. 2007, as amended, or (z) a similar change of
control under any other agreement to which McMoRan is a party.
          (b) For so long as PXP and its Affiliates are the Beneficial Owners of
at least 10% of the issued and outstanding shares of McMoRan Common Stock, then
PXP shall have the right to designate two Designated Directors. In the event
that PXP and its Affiliates are the Beneficial Owners of less than 10% but at
least 5% of the issued and outstanding shares of McMoRan Common Stock, then PXP
shall have the right to designate one Designated Director. In the event that PXP
and its Affiliates are the Beneficial Owners of less than 5% of the issued and
outstanding shares of McMoRan Common Stock, PXP shall have no right to designate
any directors to the Board.
          (c) Each Designated Director shall, in the reasonable judgment of
McMoRan, (i) have the requisite skill and experience to serve as a director of a
publicly traded company, (ii) not be prohibited or disqualified from serving as
a director of McMoRan pursuant to any rule or regulation of the SEC or NYSE or
by applicable law, and (iii) have not engaged in (A) acts or omissions
constituting a breach of such Designated Director’s duty of loyalty to any
organization, (B) any transaction from which such Designated Director derived an
improper personal benefit, or (C) acts or omissions that involve intentional
misconduct, intentional violation of law or crimes of moral turpitude. PXP shall
timely provide, and shall use its commercially reasonable efforts to cause the
Designated Directors to timely provide, McMoRan with accurate and complete
information relating to PXP and the Designated Directors that may be required to
be disclosed by McMoRan under the Securities Act or the Exchange Act. In
addition, at McMoRan’s request, PXP shall cause the Designated Directors to
complete and execute McMoRan’s standard director and officer questionnaire prior
to being admitted to the Board or standing for reelection at an annual meeting
of stockholders or at such other time as may be reasonably requested by McMoRan.
The Parties agree that the initial Designated Directors shall be James C. Flores
and John F. Wombwell.
          (d) Not less than one hundred twenty (120) days prior to each annual
meeting of stockholders of McMoRan (assuming for these purposes that each such
annual meeting shall be held on the anniversary of the prior year’s annual
meeting), PXP shall provide McMoRan with written notice of the names of the
Designated Directors to be nominated for election at such meeting. Within ten
(10) days after receipt of such notice, McMoRan shall provide PXP with written
notice as to whether the Designated Directors satisfy the requirements of
Section 2(c). If

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it is determined that a Designated Director does not satisfy the requirements of
Section 2(c), then PXP shall continue to appoint replacement designees in a like
manner until Section 2(c) has been satisfied.
          (e) In accordance with the terms herein, McMoRan shall nominate each
Designated Director for election to the Board at each annual meeting of
stockholders. If elected, each Designated Director will hold office until his or
her term expires and such Designated Director’s successor has been duly elected
and qualified or until such Designated Director’s earlier death, resignation or
removal.
          (f) Prior to the termination of rights to designate directors as
provided herein:
               (i) in connection with each annual meeting of stockholders, and
subject to Section 2(c), the Board shall (A) nominate the Designated Directors
for election at such meeting and (B) shall not submit to McMoRan’s stockholders
a greater number of Board nominees for election at such meeting than positions
to be filled by election at such meeting;
               (ii) in connection with each annual meeting of stockholders, and
subject to the provisions of this Section 2, McMoRan will take all actions
necessary or advisable to cause the Board to recommend that stockholders vote
“FOR” the election of each Designated Director and to solicit proxies in favor
of each Designated Director at any such meeting;
               (iii) PXP shall, and shall cause each Affiliate of PXP holding
shares of McMoRan Common Stock to, at any annual or special meeting of
stockholders of McMoRan, however called, including any adjournment or
postponement thereof, appear at each such meeting or otherwise cause its shares
of McMoRan Common Stock to be counted as present thereat for purposes of
calculating a quorum;
               (iv) if a Designated Director is nominated and not elected at the
annual meeting of stockholders, then PXP shall provide McMoRan the name of a
replacement director and, provided that such person satisfies the requirements
of Section 2(c), the Board and McMoRan shall take such action as may be
necessary to appoint such person to serve as a Designated Director to the Board,
including, if applicable, increasing the size of the Board and appointing such
Designated Director to fill the newly-created directorship;
               (v) any Designated Director may be removed for cause pursuant to
and in accordance with Article VI.5. of the McMoRan Charter;
               (vi) upon written notice from McMoRan to PXP that a Resignation
Event has occurred, which notice shall set forth in reasonable detail the facts
and circumstances constituting the Resignation Event, PXP will cause the
applicable Designated Director to resign as a member of the Board within two
(2) Business Days of such written notice, and any vacancy created by such
resignation shall be filled by the Board with an individual designated by PXP
who, subject to Section 2(c) of this Agreement, shall become a Designated
Director; and

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               (vii) if a Designated Director ceases to continue in office for
any reason, PXP shall designate a replacement director and, subject to
Section 2(c), the Board shall take such action as is necessary or appropriate to
cause such replacement director to be appointed to the vacancy on the Board
created by the Designated Directors ceasing to serve on the Board.
          (g) At least one Designated Director shall be a member of the
executive committee of the Board or its equivalent, if any.
          (h) Prior to making a determination that any Resignation Event has
occurred, the Board shall provide such Designated Director with proper notice of
a meeting of the Board to discuss and, if applicable, to dispute the proposed
determination. At such duly called and held Board meeting, the Board shall
provide such Designated Director with a reasonable opportunity to be heard and
to present information relevant to the Board’s proposed determination. The Board
may make a determination that a Resignation Event has occurred only following
its consideration in good faith of such information presented by such Designated
Director.
          (i) Prior to designating a Designated Director, PXP shall enter into a
written agreement with such Designated Director whereby such Designated Director
agrees to resign as a member of the Board upon a Resignation Event or as
otherwise provided therein. PXP acknowledges and agrees that such an agreement
is in the best interest of McMoRan and PXP, and that McMoRan shall be a
third-party beneficiary of the terms and conditions of such an agreement, and
McMoRan shall have the right to enforce such an agreement to the same extent as
the parties thereto.
          (j) McMoRan shall not take any action that would lessen, restrict,
prevent or otherwise have an adverse effect upon the foregoing rights of PXP to
Board representation (or representation on any committee thereof); provided,
however, that McMoRan shall not be prohibited from taking such action that the
Board determines may be necessary to (i) comply with any rule or regulation of
the SEC or NYSE or (ii) comply with applicable Law.
Section 3. Termination of Director Designation Rights. Promptly upon receipt of
a written request from McMoRan, if PXP and its Affiliates cease to Beneficially
Own less than 10% of the issued and outstanding shares of McMoRan Common Stock,
then PXP shall use its commercially reasonable efforts to cause one Designated
Director to resign as a member of the Board and all committees thereof. Promptly
upon receipt of a written request from McMoRan, if PXP and its Affiliates cease
to Beneficially Own less than 5% of the issued and outstanding shares of McMoRan
Common Stock, then PXP shall use its commercially reasonable efforts to cause
all Designated Director(s) to resign as members of the Board and all committees
thereof.
Section 4. Director Indemnification. At all times while any Designated Director
is serving as a member of the Board, and following any such Designated
Director’s death, resignation, removal or other cessation as a director of
McMoRan, each Designated Director shall be entitled to all rights to
indemnification and exculpation as are then made available to any other member
of the Board. With respect to such rights of indemnification, as between
McMoRan, on the one hand, and PXP and its Affiliates (other than McMoRan), on
the other hand, McMoRan shall, in

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all events, be the full indemnitor of first resort and shall not be entitled to
any contribution, indemnification or other payment by or from any of PXP or its
Affiliates (other than McMoRan).
Section 5. Standstill Agreement.
          (a) PXP agrees that, without the prior written approval of at least a
majority of the members of the Board who are not Designated Directors, neither
PXP nor any of its Affiliates or representatives will, directly or indirectly:

  (i)   in any way acquire, offer or propose to acquire or agree to acquire,
Beneficial Ownership of any (x) McMoRan Common Stock if such acquisition would
result in PXP and its Affiliates having Beneficial Ownership of more than 23.1%
of the outstanding shares of McMoRan Common Stock, calculated on a fully diluted
basis assuming the issuance of all shares of McMoRan Common Stock that are or
may be issuable upon conversion of any McMoRan convertible preferred security or
convertible debt security, or (y) any other debt or equity securities of
McMoRan;     (ii)   commence any tender or exchange offer for any securities of
McMoRan;     (iii)   enter into or agree, offer, propose or seek (whether
publicly or otherwise) to enter into, or otherwise be involved in or part of,
any acquisition transaction, merger or other business combination relating to
all or part of McMoRan or any of its subsidiaries or any acquisition transaction
for all or part of the assets of McMoRan or any of its subsidiaries or any of
their respective businesses;     (iv)   make, or in any way participate in, any
“solicitation” of “proxies” (as such terms are defined under Regulation 14A
under the Exchange Act, disregarding clause (iv) of Rule 14a-1(l)(2) and
including any otherwise exempt solicitation pursuant to Rule 14a-2(b)) or
consents to vote, or seek to advise or influence any person or entity with
respect to the voting of, any voting securities of McMoRan;     (v)   call or
seek to call a meeting of the shareholders of McMoRan or initiate any
stockholder proposal for action by shareholders of McMoRan;     (vi)   form,
join or in any way participate in a “group” (within the meaning of
Section 13(d)(3) of the Exchange Act and the rules and regulations thereunder)
with respect to McMoRan Common Stock or other debt or equity securities of
McMoRan, or seek, propose or otherwise act alone or in concert with others, to
influence or control the management, board of directors or policies of McMoRan;
    (vii)   publicly announce or disclose any intention, plan or arrangement
inconsistent with the foregoing;

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  (viii)   bring any action or otherwise act to contest the validity of this
Section 5 or seek a release of the restrictions contained herein, or make a
request to amend or waive any provision of this Section 5; or     (ix)   take
any actions which would be inconsistent with the purpose and intent of this
Section 5;

provided that nothing in this Section 5 shall prevent PXP or its Affiliates from
voting any shares of McMoRan Common Stock then Beneficially Owned by PXP or its
Affiliates in any manner; and provided, further, that nothing in clauses (ii),
(iii), (iv) or (v) of this Section 5(a) shall apply to any Designated Director
solely in his or her capacity as a director of McMoRan.
          (b) The provisions of Section 5(a) shall terminate, and shall be of no
further force or effect, upon the last to occur of (i) the first date on which
no Designated Directors shall have been members of the Board for the preceding
six-month period, and (ii) PXP and its Affiliates Beneficially Owning fewer than
20% of the issued and outstanding shares of McMoRan Common Stock.
Section 6. Transfer Restrictions.
          (a) Restrictions on Transfer. Except as otherwise permitted in this
Agreement, during the twelve month period ending on the first anniversary of the
date hereof, PXP will not, and shall cause its Affiliates not to, transfer,
sell, assign, pledge or otherwise dispose, directly or indirectly (“Transfer”),
of any shares of McMoRan Common Stock acquired pursuant to the Merger Agreement.
Following the first anniversary of the date hereof, PXP’s Transfers of McMoRan
Common Stock under the Registration Rights Agreement shall be limited to
Transfers (i) in Underwritten Offerings (as such term is defined in the
Registration Rights Agreement), (ii) in periodic sales under a Registration
Statement (as such term is defined in the Registration Rights Agreement) so long
as, in the case of Transfers made pursuant to this clause (ii), the aggregate
number of shares so Transferred in any three-month period does not exceed the
amount permitted to be sold pursuant to the provisions of Rule 144(e) under the
Securities Act, regardless of whether such shares are actually being Transferred
in reliance on such Rule (it being understood that shares of McMoRan Common
Stock sold in an Underwritten Offering shall not be taken into account in such
calculation) and (iii) pursuant to the exercise of piggyback registration rights
under the Registration Rights Agreement. Any Transfer or attempted Transfer of
shares of McMoRan Common Stock in violation of this Section 6 shall, to the
fullest extent permitted by law, be null and void ab initio, and McMoRan shall
not, and shall instruct its transfer agent and other third parties not to,
record or recognize any such purported transaction on the share register of
McMoRan. PXP acknowledges that this Section 6 may be enforced by McMoRan at the
direction of a majority of the members of the Board who are not Designated
Directors. Following the first anniversary of the date hereof, other than
limitations on Transfer under the Registration Rights Agreement set forth in the
second sentence of this Section 6(a), PXP may Transfer shares of McMoRan Common
Stock in any way permitted by applicable law.
          (b) Permitted Transfers. Notwithstanding Section 6(a), PXP shall be
permitted to Transfer any portion or all of its shares of McMoRan Common Stock
at any time

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under the following circumstances:

  (i)   Transfers to any direct or indirect wholly owned Subsidiary of McMoRan;
    (ii)   Transfers pursuant to a merger, tender offer or exchange offer or
other business combination, acquisition of assets or similar transaction or
change of control involving McMoRan or any of its subsidiaries, provided that
such transaction has been approved by the Board;     (iii)   Transfers pursuant
to a merger, tender offer or exchange offer or other business combination,
acquisition of all or substantially all of the assets or similar transaction
that would result in a change of control involving PXP;     (iv)   Transfers
pursuant to the exercise of piggyback registration rights under the Registration
Rights Agreement; and     (v)   pledges of McMoRan Common Stock under the PXP
Credit Agreement or other bona fide instruments or agreements representing
indebtedness for borrowed money.

          (c) Hedging. Except as prohibited by applicable law, notwithstanding
anything contained in this Agreement to the contrary, PXP may enter into or
effect any hedging transaction with respect to the Shares, including, without
limitation, calls, puts and options.
Section 7. Use of Information. PXP shall not, and shall cause its Affiliates and
each Designated Director not to, use nonpublic information obtained from the
Designated Directors’ service on the Board in any manner adverse to McMoRan.
Section 8. Nonsolicitation of Employees. Until the first anniversary of the
first date on which PXP shall no longer have the right to designate Designated
Directors, PXP shall not, and shall cause its Affiliates and any employment
agencies acting on its behalf not to, solicit, recruit or hire, without
McMoRan’s express written consent, any Persons who are employed by McMoRan or
any of its Affiliates immediately after the date hereof. Notwithstanding the
foregoing, this prohibition on solicitation, recruitment and hiring does not
apply to actions taken solely as a result of an employee’s affirmative response
to a general recruitment effort carried out through a public solicitation or
general solicitation.
Section 9. Legend.
          (a) PXP agrees that all certificates or other instruments representing
the shares of McMoRan Common Stock acquired pursuant to the Merger Agreement
will bear a legend substantially to the following effect:

  (i)   THE SECURITIES REPRESENTED BY THIS INSTRUMENT HAVE NOT BEEN REGISTERED
UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR SECURITIES LAWS OF ANY STATE
AND MAY NOT BE TRANSFERRED, SOLD OR OTHERWISE DISPOSED OF EXCEPT WHILE A
REGISTRATION STATEMENT RELATING

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      THERETO IS IN EFFECT UNDER SUCH ACT AND APPLICABLE STATE SECURITIES LAWS
OR PURSUANT TO AN EXEMPTION FROM REGISTRATION UNDER SUCH ACT OR SUCH LAWS.

  (ii)   THE SECURITIES REPRESENTED BY THIS CERTIFICATE ARE SUBJECT TO TRANSFER
AND OTHER RESTRICTIONS SET FORTH IN A STOCKHOLDER AGREEMENT, DATED AS OF
DECEMBER 30, 2010, COPIES OF WHICH ARE ON FILE WITH THE SECRETARY OF THE ISSUER.

          (b) Upon request of PXP, upon receipt by McMoRan of an opinion of
counsel reasonably satisfactory to McMoRan to the effect that such legend is no
longer required under the Securities Act and applicable state laws, McMoRan
shall promptly cause clause (i) of the legend to be removed from any certificate
for any shares of McMoRan Common Stock to be Transferred in accordance with the
terms of this Agreement and clause (ii) of the legend shall be removed upon the
expiration of such transfer and other restrictions set forth in this Agreement.
Section 10. Amendment to Certificate of Incorporation. McMoRan shall call, hold
and convene a meeting of its stockholders at least once each year until the
Amendment (as defined hereinafter) is approved by McMoRan’s stockholders (each
such meeting, or any adjournments or postponements thereof, the “Stockholders
Meeting”) for the purpose of approving and adopting an amendment to McMoRan’s
certificate of incorporation (as in effect on the date hereof). The form of such
amendment (the “Amendment”) is set forth on Exhibit A hereto. The first such
Stockholders Meeting shall be held at the next regularly scheduled annual
meeting of McMoRan’s stockholders. Further, (i) the Board of Directors of
McMoRan shall recommend that the stockholders of McMoRan vote in favor of the
Amendment at each such Stockholders Meeting and the Board of Directors of
McMoRan shall use its commercially reasonable efforts to solicit from
stockholders of McMoRan proxies in favor of the Amendment and (ii) the proxy
materials for each such Stockholder Meeting shall include a statement to the
effect that the Board of Directors of McMoRan has recommended that McMoRan’s
stockholders vote in favor of the Amendment at each such Stockholders Meeting.
McMoRan may adjourn or postpone each such Stockholders Meeting to the extent
necessary to ensure that any required supplement or amendment to the proxy
materials for each such Stockholder Meeting is provided to McMoRan’s
stockholders and such stockholders have adequate time to review such supplement
or amendment or, if as of the time for which any such Stockholders Meeting is
originally scheduled, there are insufficient shares of McMoRan Common Stock
represented (either in person or by proxy) to constitute a quorum necessary to
conduct business at such meeting.
Section 11. Miscellaneous.
          (a) Adjustments. Notwithstanding anything herein to the contrary, all
measurements and references in this Agreement related to McMoRan Common Stock
shall be, in each instance, appropriately adjusted for any subdivisions or
combinations of the McMoRan Common Stock, including but not limited to stock
splits, stock combinations, stock distributions and the like.

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          (b) Entire Agreement. The Merger Agreement and this Agreement
constitute the entire agreement between the Parties pertaining to the subject
matter hereof, and supersede all prior agreements, understandings, negotiations
and discussions, whether oral or written, of the Parties pertaining to the
subject matter hereof.
          (c) Notices. All notices that are required or may be given pursuant to
this Agreement shall be sufficient in all respects if given in writing. Any such
notice shall be deemed given (i) when made, if made by hand delivery, and upon
confirmation of receipt, if made by facsimile, (ii) one Business Day after being
deposited with a next-day courier, postage prepaid, or (iii) three Business Days
after being sent certified or registered mail, return receipt requested, postage
prepaid, in each case addressed as follows:
If to PXP, to:
Plains Exploration & Production Company
700 Milam Street, Suite 3100
Houston, Texas 77002
Fax: (713) 579-6231
Attention: General Counsel
With a copy to (which copy shall not constitute notice):
Latham & Watkins LLP
717 Texas Avenue, Suite 1600
Houston, Texas 77002
Fax: (713) 546-5401
Attention: Michael E. Dillard
                 Sean T. Wheeler
If to McMoRan:
McMoRan Exploration Co.
1615 Poydras Street
New Orleans, Louisiana 70112
Fax: 504-585-3513
Attention: John Amato
With a copy to (which copy shall not constitute notice):
Baker Botts L.L.P.
One Shell Plaza
910 Louisiana Street
Houston, Texas 77002
Fax: (713) 229-1522
Attention: J. David Kirkland, Jr.
                 M. Breen Haire

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          (d) Interpretation. The words “hereof,” “herein” and “hereunder” and
words of similar import when used in this Agreement shall refer to this
Agreement as a whole and not to any particular provision of this Agreement, and
section references are to this Agreement unless otherwise specified. Whenever
the words “include,” “includes” or “including” are used in this Agreement, they
shall be deemed to be followed by the words “without limitation.” The meanings
given to terms defined herein shall be equally applicable to both the singular
and plural forms of such terms. The table of contents and headings contained in
this Agreement are for reference purposes only and shall not affect in any way
the meaning or interpretation of this Agreement. This Agreement is the product
of negotiation by the Parties having the assistance of counsel and other
advisers. It is the intention of the Parties that this Agreement not be
construed more strictly with regard to one Party than with regard to the others.
          (e) Counterparts. This Agreement may be executed in counterparts, each
of which shall be deemed an original instrument, but all such counterparts
together shall constitute but one agreement. Facsimiles of signatures or
signatures delivered in portable document format (.pdf) will be deemed to be
originals.
          (f) Entire Agreement. This Agreement constitutes the entire agreement
between the Parties pertaining to the subject matter hereof, and supersedes all
prior agreements, understandings, negotiations and discussions, whether oral or
written, of the Parties pertaining to the subject matter hereof.
          (g) Governing Law; Consent to Jurisdiction; Waiver of Jury Trial. This
Agreement and the legal relations between the Parties shall be governed by and
construed in accordance with the laws of the State of Delaware, United States of
America without regard to principles of conflicts of laws that would direct the
application of the laws of another jurisdiction. Any action brought in
connection with this Agreement shall be brought in the federal or state courts
located in the City of Wilmington, Delaware. The Parties hereto hereby
(i) irrevocably consent to the personal jurisdiction and venue of such courts,
and (ii) waive any claim (by way of motion, as a defense or otherwise) of
improper venue, that such parties are not subject personally to the jurisdiction
of such court, that such courts are an inconvenient forum or that this Agreement
or the subject matter may not be enforced in or by such court. THE PARTIES
HEREBY ACKNOWLEDGE THAT THEY HAVE BEEN REPRESENTED BY AND HAVE CONSULTED WITH
COUNSEL OF THEIR CHOICE, AND HEREBY KNOWINGLY, VOLUNTARILY, INTENTIONALLY, AND
IRREVOCABLY WAIVE ANY AND ALL RIGHT TO TRIAL BY JURY IN RESPECT OF ANY LEGAL
PROCEEDING ARISING OUT OF OR RELATING TO THIS AGREEMENT, THE TRANSACTION
DOCUMENTS, ANY OTHER DOCUMENT EXECUTED IN CONNECTION HEREWITH, OR ANY OF THE
TRANSACTIONS CONTEMPLATED HEREBY OR THEREBY.
          (h) Amendment; Waiver. This Agreement may not be amended except by an
instrument in writing signed by PXP and McMoRan. Each Party may waive any right
of such Party hereunder by an instrument in writing signed by such Party and
delivered to PXP and McMoRan.
          (i) Remedies. The Parties agree that irreparable damage would occur in
the event that any of the provisions of this Agreement were not performed in
accordance with its

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specific terms or were otherwise breached. Each Party agrees that, in the event
of any breach or threatened breach by any other Party of any covenant or
obligation contained in this Agreement, the non-breaching Party shall be
entitled (in addition to any other remedy that may be available to it, including
monetary damages) to seek and obtain (a) a decree or order of specific
performance to enforce the observance and performance of such covenant or
obligation, and (b) an injunction restraining such breach or threatened breach.
Each Party further agrees that no other Party or any other Person shall be
required to obtain, furnish or post any bond or similar instrument in connection
with or as a condition to obtaining any remedy referred to in this Section 9(i),
and each Party hereto irrevocably waives any right it may have to require the
obtaining, furnishing or posting of any such bond or similar instrument. Each
Party further agrees that it shall not object to the granting of an order of
specific performance, an injunction or other equitable relief on the basis that
there exists an adequate remedy at law. All rights, powers and remedies provided
under this Agreement or otherwise available in respect hereof at law or in
equity shall be cumulative and not alternative, and the exercise or beginning of
the exercise of any thereof by any Party shall not preclude the simultaneous or
later exercise of any other such right, power or remedy by such Party.
          (j) Severability. Any term or provision of this Agreement which is
determined by a court of competent jurisdiction to be invalid or unenforceable
in any jurisdiction shall, as to that jurisdiction, be ineffective to the extent
of such invalidity or unenforceability without rendering invalid or
unenforceable the remaining terms and provisions of this Agreement or affecting
the validity or enforceability of any of the terms or provisions of this
Agreement in any other jurisdiction, and if any provision of this Agreement is
determined to be so broad as to be unenforceable, the provision shall be
interpreted to be only so broad as is enforceable, in all cases so long as
neither the economic nor legal substance of the transactions contemplated hereby
is affected in any manner adverse to any Party or its equityholders. Upon any
such determination, the Parties shall negotiate in good faith in an effort to
agree upon a suitable and equitable substitute provision to effect the original
intent of the Parties as closely as possible and to the end that the
transactions contemplated hereby shall be fulfilled to the maximum extent
possible.
          (k) Successors and Assigns; Third Party Beneficiaries. Neither this
Agreement nor any of the rights or obligations of any Party under this Agreement
shall be assigned, in whole or in part (by operation of law or otherwise), by
any Party without the prior written consent of the other Parties hereto. Subject
to the foregoing, this Agreement shall bind and inure to the benefit of and be
enforceable by the Parties hereto and their respective successors and permitted
assigns. Nothing in this Agreement, express or implied, is intended to confer on
any Person other than (a) the Parties hereto or (b) the Parties’ respective
successors and permitted assigns any rights, remedies, obligations or
liabilities under or by reason of this Agreement.
[Next page is the signature page.]

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     IN WITNESS WHEREOF, this Agreement has been signed by each of the Parties
as of the date first above written.

            PLAINS EXPLORATION & PRODUCTION COMPANY
      By:   /s/ Winston M. Talbert         Name:   Winston M. Talbert       
Title:   Executive Vice President and Chief
Financial Officer     

            MCMORAN EXPLORATION CO.
      By:   /s/ Kathleen L. Quirk         Name:   Kathleen L. Quirk       
Title:   Senior Vice President & Treasurer     

Signature Page to Stockholder Agreement

 

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Exhibit A
Form of Amendment to Certificate of Incorporation

1.   Amend and restate the first parenthetical in the definition of “Interested
Stockholder” in Article X, Section (k) of the McMoRan Amended and Restated
Certificate of Incorporation as follows: (other than the Corporation, any
Subsidiary, Plains Exploration & Production Company, any Employee Benefit Plan
or any fiduciary with respect to an Employee Benefit Plan acting in such
capacity, any person owning Capital Stock as of November 9, 1998, or any
Affiliate or Associate of any of the foregoing)   2.   Add the following
language at the end of the definition of “Continuing Director” in Article X(f)
of the McMoRan Amended and Restated Certificate of Incorporation: “For purposes
of this Amended and Restated Certificate of Incorporation, directors who are not
nominated for or designated for election by an Interested Stockholder shall not
be deemed to be an Affiliate or Associate of such Interested Stockholder.”