McMoRan Exploration Co.

 

Financial Counseling and Tax Return Preparation and Certification Program

 

1.  Purpose.  The purpose of the McMoRan Exploration Co. Financial Counseling
and Tax Return Preparation and Certification Program (the “Program”) is to
enable those senior executives chosen to participate in the Program to devote to
the business activities of McMoRan Exploration Co. (the “Company”) or its
subsidiaries the time and attention that such executives would otherwise have
had to devote to their personal financial or tax affairs, and, in the case of
the Tax Return Preparation and Certification aspect of the Program, to provide
the Company with assurance that the tax affairs of participating executives are
properly attended to.  To this end, the Program contemplates providing
professional counseling services in the area of personal financial and estate
planning (other than investment advice) by an independent adviser selected by
each participant from among several designated by the Company.  It also
contemplates the provision of professional assistance, by a nationally
recognized public accounting firm selected by the Company, with the preparation
and filing of personal income tax returns, followed by a certification by such
firm to the Company that all required returns have been properly prepared and
timely filed.

 

2.  Administration.  The Program shall be administered by either Co-Chairman of
the Board of the Company who shall have full authority to interpret the Program
and from time to time adopt rules and regulations for carrying out the Program,
subject to such directions as the Corporate Personnel Committee (the
“Committee”) of the Company’s Board of Directors may give, either as general
guidelines or in particular cases.

 

 

3.  Eligibility for Participation.  Participation in the Financial Counseling
aspect of the Program shall be offered to officers of the Company who are
designated by either Co-Chairman of the Board of the Company.  Either
Co-Chairman of the Board of the Company shall also from time to time select from
among the senior executives of the Company and its divisions and subsidiaries
those individuals who are to be requested to participate in the Tax Return
Preparation and Certification aspect of the Program.  Participation in either
aspect of the Program will normally continue through the year following each
participant’s retirement.

 

 

4.  General Provisions.  The selection of any employee for participation in
either aspect of the Program shall not give such employee any right to be
retained in the employ of the Company or any of its subsidiaries, and the right
of the Company and of such subsidiary to dismiss or discharge any such employee
is specifically reserved.  The benefits provided for employees under either
aspect of the Program shall be in addition to, and in no way preclude, other
forms of compensation to or in respect of such employee.

 

 

 

5.  Tax Gross-Up.  The amount of fees paid pursuant to the Program for each
participant will be grossed-up for Federal, State (where applicable), Social
Security and Medicare taxes at the highest marginal tax rate.  The Company will
pay the taxes directly to the respective agencies on behalf of participants.
 Each participant’s earnings statement and W-2 will reflect the benefit paid on
behalf of the participant under the Program and the associated tax gross-up as
earnings.  The taxes paid on behalf of the participant will also be shown as
withholdings.

 

 

6.  Amendment or Termination.  The Committee may from time to time amend or at
any time terminate the Program.