exhibit 10.26




Exhibit
10.26

FREEPORT-McMoRAN
COPPER & GOLD

 

SUPPLEMENTAL
EXECUTIVE RETIREMENT PLAN

 

PREAMBLE




Freeport-McMoRan
Copper & Gold Inc., a corporation organized and existing under the laws of
the State of Louisiana ("Employer"), acting through the Corporate Personnel
Committee of the Board of Directors, pursuant to the authority delegated to it
regarding executive compensation, and desiring to adopt a "top-hat plan" to
provide for the payment of pension benefits to two highly-compensated executive
management employees, hereby adopts the Freeport-McMoRan Copper & Gold
Supplemental Executive Retirement Plan effective on date of execution of this
Plan document. 




ARTICLE
1

PURPOSE
OF THE PLAN




The
Employer intends and desires by the adoption of this Plan to recognize the value
to the Employer of past and present services of its two senior executives, and
to encourage their continued service with the Employer by making provisions for
their future retirement security. 




ARTICLE
2

ADMINISTRATION




The
Corporate Personnel Committee of the Board of Directors of the Employer shall be
the Plan Administrator. The Plan Administrator shall have full power and
authority to interpret, construe and administer this Plan, and its
interpretations and constructions hereof and actions hereunder, including the
timing, form, amount or receipt of any payment to be made hereunder, within the
scope of its authority, shall be binding and conclusive on all persons for all
purposes. No individual member of the Corporate Personnel Committee shall be
liable to any person in connection with the interpretation or administration of
the Plan, and the Employer shall indemnify each member of the Corporate
Personnel Committee for any liability that the member might incur, except that a
member of the Corporate Personnel Committee shall be responsible for the
consequences of his or her own willful misconduct or bad faith. The Plan
Administrator may delegate its responsibilities hereunder to one or more
employees of the Employer, but no person shall participate in any action or
determination regarding his or her own benefits hereunder. 




ARTICLE
3

DEFINITIONS




1.  A form of
benefit is Actuarially
Equivalent to
another when the conversion is made using the mortality table described at
Revenue Ruling 2001-62 and a 6% interest rate. 

 

2.  A
Participant’s Beneficiary
is the
person designated by the Participant, on a Participant Election Form provided by
the Plan Administrator, to receive the benefit payable upon the death of the
Participant. If more than one Beneficiary is named they shall share
proportionately. If no Beneficiary is named the Beneficiary shall be the
Participant’s estate. 

 

3.  Code means
the Internal Revenue Code of 1986, as amended.

 

4.  Compensation for a
year means base pay for the year plus any annual incentive bonuses applicable to
that year, whether or not deferred, but taking into account a year's bonuses
only up to 200% of base pay for the year to which the bonuses apply. Long-term
incentive payments and other extraordinary compensation are
excluded.

 

5.  Credited
Service means
the period of the Participant's current employment, but not counting any time
prior to July 1, 1981.

 

6.  Employer means
Freeport-McMoRan Copper & Gold Inc. and its predecessor
companies.

 

7.  Final
Average Pay means a
Participant=s highest
average compensation for any 3 years (not necessarily consecutive) during the 5
years immediately preceding the earlier of the Participant=s
Termination of Employment or his completion of 25 years of Credited Service.


 

8.  Life
Annuity means a
monthly annuity payable to the Participant for his life only.

 

9.  Joint-and-100%-Survivor
Annuity means a
monthly benefit payable to the Participant commencing the first day of the month
following the Participant=s
Termination of Employment, continuing until the month of the Participant's
death, and continuing thereafter in the same amount to the Participant's Spouse,
if she survives him, continuing until the month of the Spouse's
death.

 

10.  Monthly
Annuity means a
hypothetical Joint-and-100% Survivor Annuity payable to the Participant and a
surviving spouse who is 2 years younger than the Participant. 

 

11.  Other
Pension Plan means
each defined-benefit or defined-contribution plan (whether qualified under the
Code or not) sponsored by the Employer, by FM Services Company, by McMoRan
Exploration Co., or by any predecessor employer (including Freeport-McMoRan
Inc.) or any employer in the controlled group for U.S. income-tax purposes with
any such employer.

 

12.  Participant means
each of James R. Moffett and Richard C. Adkerson.

 

13.  Participant
Election Form means
the form provided by the Plan Administrator on which a Participant can elect the
form of his benefit and who will receive any death benefit.

 

14.  Plan means
the Supplemental Executive Retirement Plan set forth in this document, as it may
be amended.

 

15.  Plan
Administrator means
the Corporate Personnel Committee of the Board of Directors of the Employer.
Communications to the Plan Administrator shall be addressed to the Chairman of
the Corporate Personnel Committee, Freeport-McMoRan Copper & Gold Inc., 1615
Poydras street, New Orleans, Louisiana 70112.

 

16.  Termination
of Employment means the
termination of the employment of a Participant with the Employer (or an
affiliate) in the absence of a qualifying transfer of employment. A qualifying
transfer of employment occurs when the Participant transfers from the Employer
(or an affiliate) to an affiliate of the Employer, and the Plan Administrator
determines that employment by the affiliate is to be treated the same as
employment by the Employer. 

 

ARTICLE
4

NORMAL
RETIREMENT BENEFIT




1.  Upon the
Termination of Employment of a Participant on or after his 65th birthday, the
Participant shall be entitled to a Normal Retirement Benefit.

 

2.  The
Normal Retirement Benefit shall be a Monthly Annuity equal to the difference
between X and Y, where

 

X equals
2% of the Participants' Final Average Pay, multiplied by years of Credited
Service after June 30, 1981, up to 25 years; and

 

Y equals
the total Monthly Annuity provided to the Participant under all Other Pension
Plans, using the principles set forth in Paragraph 3, below, to determine the
amount of the offset in each case.

 

3.  The
following methods shall be used in determining the amount of the benefit under
an Other Pension Plan to offset against the Monthly Annuity.

 

a. If the
benefit paid under an Other Pension Plan is in the form of a lump sum or a
different form of annuity than the Monthly Annuity, the offset shall be the
Monthly Annuity that is Actuarially Equivalent to the benefit.

 

b. If the
benefit under an Other Pension Plan is paid in the form of a lump sum prior to
the Participant's Termination of Employment, the lump sum shall be increased by
interest at the rate of 6.75% per annum, compounded annually, from the date of
its payment to the date of the Termination of Employment, prior to determining
the Monthly Annuity that is Actuarially Equivalent to the lump-sum
benefit.

 

c. If a
benefit paid under an Other Pension Plan is paid or commences later than the
benefit under the Plan, the value of the benefit (as determined under the terms
of the Other Pension Plan) as of the date of the Participant's Termination of
Employment shall be the starting point for determining the offset
amount.

 

4.  On a
Participant Election Form a Participant shall elect to receive as his benefit
either (a) a Joint-and-100%-Survivor Annuity for the Participant and his spouse,
or (b) a Life Only Annuity, or (c) a lump-sum benefit. Each benefit shall be
Actuarially Equivalent to the Monthly Annuity determined under Paragraph 2 of
this Article 4. 

 

5.  Any new
election of the form of benefit must be made by the Participant at least 12
months prior to the Participant's Termination of Employment, by delivering a
completed Participant Election Form to the Plan Administrator. Any new
Participant Election Form that is received by the Plan Administrator less than
12 months prior to the Termination of Employment shall be ineffective. As the
one exception to this rule, if the Participant has elected a
Joint-and-100%-Survivor Annuity as the form of benefit, and the spouse who would
have been the joint annuitant dies before the Participant's Termination of
Employment, the Participant may execute a new Participant Election Form within
30 days following the spouse's death. If he makes no new election he will be
deemed to have elected the lump-sum form of benefit.

 

6.  A
Participant's lump-sum benefit shall be paid within 90 days following the
Participant's Termination of Employment. The starting date for an annuity form
of benefit shall be the first day of the month next following the Participant's
Termination of Employment.

 

7.  If a
Participant's Termination of Employment occurs after he has completed 25 years
of Credited Service, the Participant's net benefit shall be determined under
Paragraph 2 as if his Termination of Employment occurred on January 1 of the
year in which he completes his 25th year of Credited Service, and the benefit
payable upon his actual Termination of Employment shall be Actuarially
Equivalent to the benefit determined upon the January 1 of the year in which he
completes 25 years of Credited Service.

 

ARTICLE
5

OTHER
PARTICIPANT BENEFITS




1.  A
Participant whose Termination of Employment occurs prior to his 65th birthday is
entitled to an Early Retirement Benefit. The amount of the Monthly Annuity shall
be determined in the same manner as for a Normal Retirement Benefit, except that
the value of X at
Paragraph 2 of Article 4 is reduced by 1/4 of 1% for each month (or part of a
month) that the commencement of the benefit precedes the Participant's 65th
birthday.

 

2.  If a
Participant in the Plan has a Termination of Employment and is subsequently
re-employed, the new period of employment shall not affect the payment of the
benefit, nor shall it affect the amount of the benefit.

 

ARTICLE
6

DEATH




If a
Participant should die before his Termination of Employment, a death benefit
shall be paid in a lump sum to his Beneficiary. The death benefit shall be equal
to the amount that would have been paid to the Participant if his Termination of
Employment had occurred on the date of his death and he had elected a lump-sum
benefit.

 

ARTICLE
7

AMENDMENT
AND DISCONTINUANCE




1.  The
Employer expects to continue this Plan indefinitely but reserves the right,
acting through the Plan Administrator, to amend or discontinue the Plan,
provided, however, that the benefit promised to a Participant can be affected
without the Participant=s consent
only as set forth below.

 

2.  No
amendment can reduce the Participant's benefit below what the Participant would
have been entitled to receive if his Termination of Employment had occurred on
the day when the amendment is adopted.

 

3.  If the
Plan Administrator should discontinue this Plan, the Employer shall be obligated
to pay all benefits that are already due as the result of a Termination of
Employment. 

 

4.  In the
event of the discontinuance of the Plan, the benefit of each Participant who has
not had a Termination of Employment shall be no less than the benefit that is
Actuarially Equivalent to the Monthly Annuity determined as if the Participant
had had a Termination of Employment on the date when the Plan is discontinued
(the "discontinuance date"). The Employer can decide to pay the Participant's
benefit when it would otherwise become due under the terms of Articles 4, 5 and
6, above, or may accelerate the payment, and may require payment in a lump
sum.

 

ARTICLE
8

RESTRICTIONS
ON ASSIGNMENT




The
interest of a Participant or Beneficiary may not be sold, transferred, assigned,
or encumbered in any manner, either voluntarily or involuntarily. Neither shall
the benefits hereunder be liable for or subject to the claims of the creditors
of any person to whom such benefits or funds are payable, except that (i) no
amount shall be payable hereunder until and unless any and all amounts
representing debts or other obligations owed to the Employer or any affiliate of
the Employer by the Participant with respect to whom such amounts would
otherwise be payable shall have been fully paid and satisfied, and (ii) no
amounts shall be payable hereunder to any Participant (or Beneficiary) if the
Participant breaches any of the terms of the Participant=s
employment agreement with the Employer governing nondisclosure, noncompetition,
or proprietary rights.




ARTICLE
9

NATURE
OF AGREEMENT




Participants
and Beneficiaries under this Plan have only an unsecured right to receive
benefits from the Employer as general creditors of the Employer. The Plan
constitutes a mere promise to make payments in the future. Employer may set
aside funds, in a trust or otherwise, for the purpose of satisfying its
obligations under the Plan. The setting aside of amounts by the Employer with
which to discharge its obligations hereunder shall not create any security for
the payment of Plan benefits. Any and all funds so set aside shall remain
subject to the claims of the general creditors of the Employer, present and
future. This provision shall not require the Employer to set aside any funds,
but the Employer may set aside such funds if it chooses to do so. 




ARTICLE
10

CLAIMS
PROCEDURE




A claim
for benefits must be submitted in writing to the Plan Administrator. If a claim
is wholly or partially denied, a notice of the decision will be furnished to the
claimant not later than 90 days after receipt of the claim by the Plan
Administrator. The notice will include the reason or reasons for the denial. The
claimant will be informed if additional information is needed in order to
properly evaluate the claim.




The
applicant will have 60 days within which to appeal a denied claim in writing to
the Plan Administrator. The applicant (who may act at each stage act through a
duly-authorized representative) should include in his written appeal the
following information: a list of the findings in the claim denial that he
chooses to contest; his position on each issue; any additional facts that he
believes support his position; and any legal or other arguments he believes
support his position. Upon request, the claimant will be given reasonable access
to, and copies of, all documents and information relevant to the claim for
benefits, at no charge.




Upon
receipt of an appeal, the Plan Administrator will consider all items submitted
by the claimant, regardless of whether such information was submitted or
considered in the initial benefit determination. No deference will be afforded
to the initial determination. The decision on review will be rendered as
promptly as is feasible, but not later than 60 days after the receipt of a
request for review unless the Plan Administrator, in its sole discretion,
determines that special circumstances require an extension of time for
processing, in which case a decision will be rendered as promptly as is
feasible, but not later than 120 days after receipt of a request for review, and
the claimant will be notified of the delay before the end of the initial 60-day
period.




In the
event of a decision to deny the claim, in whole or in part, the Plan
Administrator's decision will contain: (1) specific reasons for the decision,
written in a clear and simple manner; (2) specific references to the pertinent
plan provisions on which the decision is based; (3) a statement that the
claimant may request, at no charge, reasonable access to and copies of all
documents, records and other information relevant to the claim for benefits; and
(4) a description of the claimant's further rights to pursue his
claim.




If the
claimant wishes to contest the Plan Administrator’s decision on appeal, the
claimant and the Plan Administrator may enter into voluntary binding arbitration
to resolve the dispute. Alternatively, the Participant may bring a civil action
for recovery of benefits, pursuant to Section 502(a) of ERISA. No legal action
for recovery of benefits may be commenced before the claimant has exhausted the
claims review procedure described above.




ARTICLE
11

MISCELLANEOUS




1.  If the
Employer, through a mistake of law or fact, pays to a Participant or other
person a Plan benefit that the recipient is not entitled to, the recipient shall
repay the mistaken amount to the Employer. The Employer may offset the future
benefits of any recipient who refuses to return an erroneous payment, in
addition to pursuing other remedies provided by law.

 

2.  Nothing
contained herein shall be construed as conferring upon any Participant the right
to continue in the employ of the Employer in any capacity. 

 

3.  The Plan
shall be binding upon and inure to the benefit of the Employer, its successors
and assigns and each Participant and his or her heirs, executors, administrators
and legal representatives.

 

4.  The Plan
shall be construed in accordance with and governed by the laws of the State of
Louisiana, except to the extent that the Plan is governed by the Employee
Retirement Income Security Act of 1974 (AERISA@). It is
the Employer's intent that the Plan shall be exempt from ERISA's provisions to
the maximum extent permitted by law. The Plan is intended to be unfunded for
federal income tax purposes and for the purposes of Title I of ERISA, and is
intended to provide a pension benefit only for a select group of executive
management or highly compensated employees, so as to be exempt from Parts 2, 3
and 4 of Title I of ERISA, pursuant to Sections 201(2), 301(a)(3), and 401(a)(1)
of ERISA.

 

5.  The ERISA
plan number of the Plan is 0___. The EIN and address of the Employer are:
Freeport-McMoRan Copper & Gold Inc, 74-2480931, 1615 Poydras Street, New
Orleans, LA 70112. 

 

6.  This Plan
document, and any amendment hereto, shall also serve as the Plan=s Summary
Plan Description. A copy of this Plan document and each amendment hereto shall
be provided to each Participant.

 


Executed
this 26th day of
February, 2004.

 





	
      WITNESSES:
	
      FREEPORT-McMoRAN
      COPPER AND GOLD INC.








	
      /s/
      Judy Witterich
	
      By:
      The Corporate Personnel Committee




of
the Board of Directors



 

/s/
Annie Gandy       
 By:/s/
H. Devon Graham, Jr.

            
H. Devon Graham, Jr., Chairman