ex10-1.htm


    
      

    

    EXHIBIT
10.1

    Form for
Straight Grant

    


    FREEPORT-McMoRan
COPPER & GOLD INC.

    


    NOTICE
OF GRANT

    OF

    PERFORMANCE-BASED

    RESTRICTED
STOCK UNITS

    UNDER
THE 20__ STOCK INCENTIVE PLAN

    


    1. (a)           Pursuant
to the Freeport-McMoRan Copper & Gold Inc. 20__ Stock Incentive Plan (the
“Plan”), on ____________, 20__ (the “Grant Date”), Freeport-McMoRan Copper &
Gold Inc., a Delaware corporation (the “Company”) granted
____________  restricted stock units (“Restricted Stock Units” or
“RSUs”) to _________________ (the “Participant”) on the terms and conditions set
forth in this Notice and in the Plan.

     

    (b) Defined
terms not otherwise defined herein shall have the meanings set forth in Section
2 of the Plan.

     

    (c) Subject
to the terms, conditions, and restrictions set forth in the Plan and herein,
each RSU granted hereunder represents the right to receive from the Company, on
the respective scheduled vesting date for such RSU set forth in Section 2(a) of
this Notice or on such earlier date as provided in Section 2(b) of this Notice
or Section 5(b) of this Notice (the “Vesting Date”), one share (a “Share”) of
common stock of the Company (“Common Stock”), free of any restrictions, all
amounts notionally credited to the Participant’s Dividend Equivalent Account (as
defined in Section 4 of this Notice) with respect to such RSU, and all
securities and property comprising all Property Distributions (as defined in
Section 4 of this Notice) deposited in such Dividend Equivalent Account with
respect to such RSU.

     

    (d) Provided
the condition of Section 6 of this Notice, if applicable, has been met, as soon
as practicable after the Vesting Date (but no later than 2 1⁄2 months from such
date) for any RSUs granted hereunder, the Participant shall receive from the
Company the number of Shares to which the vested RSUs relate, free of any
restrictions, a cash payment for all amounts notionally credited to the
Participant’s Dividend Equivalent Account with respect to such vested RSUs, and
all securities and property comprising all Property Distributions deposited in
such Dividend Equivalent Account with respect to such vested RSUs.

     

    2. (a)           Provided
the condition of Section 6 of this Notice has been met, the RSUs granted
hereunder shall vest in installments as follows:

     

    
      	
              Scheduled Vesting
      Date

            	
              Number of
      RSUs

            
	 
      	 
      


    

    


    
      
         

      

      
         

        
          

        

      

      
         

      

    

     

    (b) Notwithstanding
Section 2(a) of this Notice, at such time as there shall be a Change in
Control of the Company, all unvested RSUs shall be accelerated and shall
immediately vest.

     

    (c) Until the
respective Vesting Date for an RSU granted hereunder, such RSU, all amounts
notionally credited in any Dividend Equivalent Account related to such RSU, and
all securities or property comprising all Property Distributions deposited in
such Dividend Equivalent Account related to such RSU shall be subject to
forfeiture as provided in Section 5 of this Notice.

     

    3. Except as
provided in Section 4 of this Notice, an RSU shall not entitle the Participant
to any incidents of ownership (including, without limitation, dividend and
voting rights) in any Share until the RSU shall vest and the Participant shall
be issued the Share to which such RSU relates nor in any securities or property
comprising any Property Distribution deposited in a Dividend Equivalent Account
related to such RSU until such RSU vests.

     

    4. From and
after the Grant Date of an RSU until the issuance of the Share payable in
respect of such RSU, the Participant shall be credited, as of the payment date
therefor, with (i) the amount of any cash dividends and (ii) the amount equal to
the Fair Market Value of any Shares, Subsidiary securities, other securities, or
other property distributed or distributable in respect of one share of Common
Stock to which the Participant would have been entitled had the Participant been
a record holder of one share of Common Stock at all times from the Grant Date to
such issuance date (a “Property Distribution”).  All such credits
shall be made notionally to a dividend equivalent account (a “Dividend
Equivalent Account”) established for the Participant with respect to all RSUs
granted hereunder with the same Vesting Date.  All credits to a
Dividend Equivalent Account for the Participant shall be notionally increased by
the Account Rate (as hereinafter defined), compounded quarterly, from and after
the applicable date of credit until paid in accordance with the provisions of
this Notice.  The “Account Rate” shall be the prime commercial lending
rate announced from time to time by JPMorgan Chase Bank, N.A. or by another
major national bank headquartered in New York, New York designated by the
Committee.  The Committee may, in its discretion, deposit in the
Participant’s Dividend Equivalent Account the securities or property comprising
any Property Distribution in lieu of crediting such Dividend Equivalent Account
with the Fair Market Value thereof.

     

    5.   (a) Except
as set forth in Section 5(b) of this Notice, all unvested RSUs provided for in
this Notice, all amounts credited to the Participant’s Dividend Equivalent
Accounts with respect to such RSUs, and all securities and property comprising
Property Distributions deposited in such Dividend Equivalent Accounts with
respect to such RSUs shall immediately be forfeited on the date the Participant
ceases to be an Eligible Individual (the “Termination Date”).

     

    (b) Notwithstanding
the foregoing, and provided the condition of Section 6 of this Notice has been
met, if the Participant ceases to be an Eligible Individual (the “Termination”)
by reason of the Participant’s death, Disability, or Retirement, the RSUs
granted hereunder that are scheduled to vest on the first Vesting Date following
the Termination Date, all amounts credited to the Participant’s Dividend
Equivalent Accounts with respect to such RSUs, and all securities and property
comprising Property Distributions deposited in such Dividend 

     

    
      
         

      

      
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    Equivalent
Accounts with respect to such RSUs shall vest as of the Participant’s
Termination Date.  In the event that the Participant ceases to be an
Eligible Individual by reason of the Participant’s Termination by his employer
or principal without Cause, and provided the condition of Section 6 of this
Notice has been met, the Committee or any person to whom the Committee has
delegated authority may, in its or his sole discretion, determine that the RSUs
granted hereunder that are scheduled to vest on the first Vesting Date following
the Termination Date, all amounts credited to the Participant’s Dividend
Equivalent Accounts with respect to such RSUs, and all securities and property
comprising Property Distributions deposited in such Dividend Equivalent Accounts
with respect to such RSUs shall vest as of the Participant’s Termination
Date.  In the event vesting is accelerated pursuant to this Section
5(b) and the Participant is a Key Employee, a distribution of Shares issuable to
the Participant, all amounts notionally credited to the Participant’s Dividend
Equivalent Account, and all securities and property comprising all Property
Distributions deposited in such Dividend Equivalent Account due the Participant
upon the vesting of the RSUs shall not occur until six months after the
Participant’s Termination Date, unless the Participant’s Termination is due to
death or Disability.

     

    6. The other
provisions of this Notice notwithstanding, no unvested RSU granted hereunder
shall vest on its scheduled Vesting Date under Section 2(a) of this Notice or
upon the Participant’s Termination pursuant to Section 5(b) of this Notice
unless the average of the Return on Investment for the five calendar years
preceding the year in which such event occurs is at least 6% and, if required or
deemed necessary to satisfy the requirements to qualify such RSU as
“performance-based compensation” under Section 162(m), the appropriate members
of the Committee shall have certified that such condition has been
met.  Any unvested RSUs that do not vest upon the occurrence of any of
such events as a result of the failure to meet the condition of this Section 6,
all amounts credited to the Participant’s Dividend Equivalent Accounts with
respect to such RSUs, and all securities and property comprising Property
Distributions deposited in such Dividend Equivalent Accounts with respect to
such RSUs shall immediately be forfeited.

     

    7. The RSUs
granted hereunder, any amounts notionally credited in the Participant’s Dividend
Equivalent Accounts, and any securities and property comprising Property
Distributions deposited in such Dividend Equivalent Accounts are not
transferable by the Participant otherwise than by will or by the laws of descent
and distribution or pursuant to a domestic relations order, as defined in the
Code.

     

    8. All
notices hereunder shall be in writing and, if to the Company, shall be delivered
personally to the Secretary of the Company or mailed to One North Central
Avenue, Phoenix, Arizona 85004, addressed to the attention of the Secretary;
and, if to the Participant, shall be delivered personally or mailed to the
Participant at the address on file with the Company.  Such addresses
may be changed at any time by notice from one party to the other.

     

    9. This
Notice is subject to the provisions of the Plan.  The Plan may at any
time be amended by the Board, except that any such amendment of the Plan that
would materially impair the rights of the Participant hereunder may not be made
without the Participant’s consent.  The Committee may amend this
Notice at any time in any manner that is not inconsistent with the terms of the
Plan and that will not result in the application of Section 409A(a)(1) of the
Code.  Notwithstanding the foregoing, no such amendment may materially
impair the rights of the 

     

    
      
         

      

      
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    Participant
hereunder without the Participant’s consent.  Except as set forth
above, any applicable determinations, orders, resolutions or other actions of
the Committee shall be final, conclusive and binding on the Company and the
Participant.

     

    10. The
Participant is required to satisfy any obligation in respect of withholding or
other payroll taxes resulting from the vesting of any RSU granted hereunder or
the payment of any securities, cash, or property hereunder, in accordance with
procedures established by the Committee, as a condition to receiving any
securities, cash payments, or property resulting from the vesting of any RSU or
otherwise.

     

    11. Nothing
in this Notice shall confer upon the Participant any right to continue in the
employ of the Company or any of its Subsidiaries, or to interfere in any way
with the right of the Company or any of its Subsidiaries to terminate the
Participant’s employment relationship with the Company or any of its
Subsidiaries at any time.

     

    12. As used
in this Notice, the following terms shall have the meanings set forth
below.

     

    (a) “Cause”
shall mean any of the following: (i) the commission by the Participant of an
illegal act (other than traffic violations or misdemeanors punishable solely by
the payment of a fine), (ii) the engagement of the Participant in dishonest or
unethical conduct, as determined by the Committee or its designee, (iii) the
commission by the Participant of any fraud, theft, embezzlement, or
misappropriation of funds, (iv) the failure of the Participant to carry out a
directive of his superior, employer or principal, or (v) the breach of the
Participant of the terms of his engagement.

     

    (b) “Change
in Control” shall mean a change in the ownership of the Company, a change in the
effective control of the Company or a change in the ownership of a substantial
portion of the assets of the Company as provided under Section 409A of the Code,
as amended from time to time, and any related implementing regulations or
guidance.

     

    (c) “Disability”
shall have occurred if the Participant is (i) unable to engage in any
substantial gainful activity by reason of any medically determinable physical or
mental impairment which can be expected to result in death or can be expected to
last for a continuous period of not less than 12 months, or (ii) by reason of
any medically determinable physical or mental impairment which can be expected
to result in death or can be expected to last for a continuous period of not
less than 12 months, receiving income replacement benefits for a period of not
less than 3 months under an accident and health plan covering employees of the
Participant’s employer.

     

    (d) “Fair
Market Value” shall, with respect to a share of Common Stock, a Subsidiary
security, or any other security, have the meaning set forth in the
Freeport-McMoRan Copper & Gold Inc. Policies of the Committee applicable to
the Plan, and, with respect to any other property, mean the value thereof
determined by the board of directors of the Company in connection with declaring
the dividend or distribution thereof.

     

    (e) “Key
Employee” shall mean any employee who meets the definition of “key employee” as
defined in Section 416(i) of the Code.

     

    
      
         

      

      
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    (f) “Managed
Net Income” shall mean, the managed net income as reviewed by the Company’s
independent registered public accounting firm, released by the Company to the
public and approved by the Board, the net income (or net loss) of the Company
and its consolidated subsidiaries with respect to any year, plus (or minus) the
following items if included in such net income (or net loss)
amounts:

     

    (i)           the
non-controlling interests’ share in the net income (or net loss) of the
Company’s consolidated subsidiaries for such year;

    


    (ii)           the
cumulative effect of changes in accounting principles of the Company and its
consolidated subsidiaries for such year plus (or minus) the non-controlling
interests’ share in such changes in accounting principles;

    


    (iii)           any
extraordinary, unusual or non-recurring items for such year plus (or minus) the
non-controlling interests’ share in such extraordinary, unusual or non-recurring
items;

    


    (iv)           the
effect of discontinued operations for such year plus (or minus) the
non-controlling interests’ share in such discontinued operations;

    


    (v)           any
non-cash gain or loss attributable to any hedging agreement relating to
commodity prices for such year plus (or minus) the non-controlling interests’
share in such non-cash gain or loss; until such time as it is settled, at which
time the net gain or loss shall be included plus (or minus) the non-controlling
interests’ share in such non-cash gain or loss;

    


    (vi)           any
non-cash gain or loss attributable to any changes in accounting principles or
policies (including adoption of International Financial Reporting Standards) for
such year plus (or minus) the non-controlling interests’ share in such non-cash
gain or loss;

    


    (vii)           any
non-cash asset impairment charges (including any goodwill impairment) and any
amortization of intangible assets or liabilities for such year following
approval of the Plan plus (or minus) the non-controlling interests’ share in
such non-cash charges or amortization;

    


    (viii)           any
change in cost of goods sold attributable to inventories resulting from the
acquisition method of accounting in connection with any acquisition for such
year following approval of the Plan plus (or minus) the non-controlling
interests’ share in such increase or decrease; and

    


    (ix)           any
adjustments specified by the Committee within the first 90 days of each year,
including without limitation, adjustments related to asset write-downs;
acquisition-related charges; litigation or claim judgments or settlements; the
effects of changes in tax law or other laws or provisions affecting reported
results; accruals for reorganization and restructuring programs; and unrealized
gains or losses on investments.

    


    (g) “Net Cash
Provided by Operating Activities” shall mean, with respect to any year, the net
cash provided by operating activities excluding working capital changes of the


     

    
      
         

      

      
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    Company
and its consolidated subsidiaries for such year as reviewed by the Company’s
independent registered public accounting firm, released by the Company to the
public and approved by the Board.

     

    (h) “Net
Interest Expense” shall mean, with respect to any year, the net interest expense
of the Company and its consolidated subsidiaries for such year as reviewed by
the Company’s independent registered public accounting firm, released by the
Company to the public and approved by the Board.

     

    (i) “Retirement”
shall mean early, normal or deferred retirement of the Participant under a tax
qualified retirement plan of the Company or any other cessation of the provision
of services to the Company or a Subsidiary by the Participant that is deemed by
the Committee or its designee to constitute a retirement.

     

    (j) “Return
on Investment” shall mean, with respect to any year, the result (expressed as a
percentage) calculated according to the following formula:

     

    a + (b -
c)

    d

    


    in which
“a” equals Managed Net Income for such year, “b” equals Net Interest Expense for
such year, “c” equals Tax on Net Interest Expense for such year, and “d” equals
Total Investment of Capital for such year.

    


    (k) “Tax on
Net Interest Expense” shall mean, with respect to any year, the tax on the net
interest expense of the Company and its consolidated subsidiaries for such year
calculated at the appropriate income tax rate for such year as reviewed by the
Company’s independent registered public accounting firm.

     

    (l) “Total
Investment of Capital” shall mean, with respect to any year, (i) the sum of (A)
the average of total equity in the Company and its consolidated subsidiaries for
such year, (B) the average of temporary equity of the Company for such year, and
(C) the average of debt of the Company and its consolidated subsidiaries for
such year, all as shown in the quarterly balance sheets of the Company and its
consolidated subsidiaries for such year, (ii) minus the average of cash and cash
equivalents of the Company and its consolidated subsidiaries for such year as
shown in the quarterly balance sheets of the Company and its consolidated
subsidiaries for such year.  If the Company is required to adopt
International Financial Reporting Standards, the foregoing calculation will
exclude any impact resulting from such adoption.

     

    


    FREEPORT-McMoRan COPPER & GOLD
INC.

    


    


    By:                                                                           
       

    



    
      
         


      

      
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