Document:

Exhibit 10.13

    Exhibit
      10.13

    

    McMoRan
      EXPLORATION CO.

    1998
      STOCK OPTION PLAN

    

    

    SECTION
      1  

     

    Purpose.
      The
      purpose of the McMoRan Exploration Co. 1998 Stock Option Plan (the “Plan”) is to
      motivate and reward key employees, consultants and advisers by giving them
      a
      proprietary interest in the Company’s continued success.

     

    SECTION
      2  

     

    Definitions.
      As used
      in the Plan, the following terms shall have the meanings set forth
      below:

     

    “Award”
      shall mean any Option, Stock Appreciation Right, Limited Right or Other
      Stock-Based Award.

     

    “Award
      Agreement” shall mean any written or electronic notice of grant, agreement,
      contract or other instrument or document evidencing any Award, which may, but
      need not, be required to be executed, acknowledged or accepted by a
      Participant.

     

    “Board”
      shall mean the Board of Directors of the Company.

     

    “Code”
      shall mean the Internal Revenue Code of 1986, as amended from time to
      time.

     

    “Committee”
      shall mean, until otherwise determined by the Board, the Corporate Personnel
      Committee of the Board.

     

    “Company”
      shall mean McMoRan Exploration Co.

     

    “Designated
      Beneficiary” shall mean the beneficiary designated by the Participant, in a
      manner determined by the Committee, to receive the benefits due the Participant
      under the Plan in the event of the Participant’s death. In the absence of an
      effective designation by the Participant, Designated Beneficiary shall mean
      the
      Participant’s estate.

     

    “Eligible
      Individual” shall mean (i) any person providing services as an officer of the
      Company or a Subsidiary, whether or not employed by such entity, including
      any
      such person who is also a director of the Company, (ii) any employee of the
      Company or a Subsidiary, including any director who is also an employee of
      the
      Company or a Subsidiary, (iii) any officer or employee of an entity with which
      the Company has contracted to receive executive, management or legal services
      who provides services to the Company or a Subsidiary through such arrangement,
      (iv) any consultant or adviser to the Company, a Subsidiary or to an entity
      described in clause (iii) hereof who provides services to the Company or a
      Subsidiary through such arrangement and (v) any person who has agreed in writing
      to become a person described in clauses (i), (ii), (iii) or (iv) within not
      more
      than 30 days following the date of grant of such person’s first Award under the
      Plan.

     

    “Exchange
      Act” shall mean the Securities Exchange Act of 1934, as amended from time to
      time.

     

    “Incentive
      Stock Option” shall mean an option granted under Section 6 of the Plan that is
      intended to meet the requirements of Section 422 of the Code or any successor
      provision thereto.

     

    “Limited
      Right” shall mean any right granted under Section 8 of the Plan.
      Notwithstanding anything contained herein to the contrary, no Limited Rights
      shall be granted after October 3, 2004.

     

    “Nonqualified
      Stock Option” shall mean an option granted under Section 6 of the Plan that is
      not intended to be an Incentive Stock Option.

     

    “Offer”
      shall mean any tender offer, exchange offer or series of purchases or other
      acquisitions, or any combination of those transactions, as a result of which
      any
      person, or any two or more persons acting as a group, and all affiliates of
      such
      person or persons, shall beneficially own more than 40% of all classes and
      series of the Company’s stock outstanding, taken as a whole, that has voting
      rights with respect to the election of directors of the Company (not including
      any series of preferred stock of the Company that has the right to elect
      directors only upon the failure of the Company to pay dividends).

     

    “Offer
      Price” shall mean the highest price per Share paid in any Offer that is in
      effect at any time during the period beginning on the ninetieth day prior to
      the
      date on which a Limited Right is exercised and ending on and including the
      date
      of exercise of such Limited Right. Any securities or property that comprise
      all
      or a portion of the consideration paid for Shares in the Offer shall be valued
      in determining the Offer Price at the higher of (i) the valuation placed on
      such
      securities or property by the person or persons making such Offer, or (ii)
      the
      valuation, if any, placed on such securities or property by the Committee or
      the
      Board.

     

    “Option”
      shall mean an Incentive Stock Option or a Nonqualified Stock
      Option.

     

    “Other
      Stock-Based Award” shall mean any right or award granted under Section 9 of
      the Plan.

     

    “Participant”
      shall mean any Eligible Individual granted an Award under the Plan.

     

    “Person”
      shall mean any individual, corporation, partnership, association, joint-stock
      company, trust, unincorporated organization, government or political subdivision
      thereof or other entity.

     

    “SAR”
      shall mean any Stock Appreciation Right.

     

    “SEC”
      shall mean the Securities and Exchange Commission, including the staff thereof,
      or any successor thereto.

     

    “Section
      162(m)” shall mean Section 162(m) of the Code and all regulations promulgated
      thereunder as in effect from time to time.

     

    “Shares”
      shall mean the shares of Common Stock, par value $0.01 per share, of the Company
      and such other securities of the Company or a Subsidiary as the Committee may
      from time to time designate.

     

    “Stock
      Appreciation Right” shall mean any right granted under Section 7 of the
      Plan.

     

    “Subsidiary”
      shall mean (i) any corporation or other entity in which the Company possesses
      directly or indirectly equity interests representing at least 50% of the total
      ordinary voting power or at least 50% of the total value of all classes of
      equity interests of such corporation or other entity and (ii) any other entity
      in which the Company has a direct or indirect economic interest that is
      designated as a Subsidiary by the Committee.

     

    SECTION
      3  

     

    (a)  Administration.
      The
      Plan shall be administered by the Committee. Subject to the terms of the Plan
      and applicable law, and in addition to other express powers and authorizations
      conferred on the Committee by the Plan, the Committee shall have full power
      and
      authority to: (i) designate Participants; (ii) determine the type or types
      of
      Awards to be granted to an Eligible Individual; (iii) determine the number
      of
      Shares to be covered by, or with respect to which payments, rights or other
      matters are to be calculated in connection with, Awards; (iv) determine the
      terms and conditions of any Award; (v) determine whether, to what extent, and
      under what circumstances Awards may be settled or exercised in cash, whole
      Shares, other whole securities, other Awards, other property or other cash
      amounts payable by the Company upon the exercise of that or other Awards, or
      canceled, forfeited or suspended and the method or methods by which Awards
      may
      be settled, exercised, canceled, forfeited or suspended; (vi) determine whether,
      to what extent, and under what circumstances cash, Shares, other securities,
      other Awards, other property, and other amounts payable by the Company with
      respect to an Award shall be deferred either automatically or at the election
      of
      the holder thereof or of the Committee; (vii) interpret and administer the
      Plan
      and any instrument or agreement relating to, or Award made under, the Plan;
      (viii) establish, amend, suspend or waive such rules and regulations and appoint
      such agents as it shall deem appropriate for the proper administration of the
      Plan; and (ix) make any other determination and take any other action that
      the
      Committee deems necessary or desirable for the administration of the Plan.
      Unless otherwise expressly provided in the Plan, all designations,
      determinations, interpretations and other decisions under or with respect to
      the
      Plan or any Award shall be within the sole discretion of the Committee, may
      be
      made at any time and shall be final, conclusive and binding upon all Persons,
      including the Company, any Subsidiary, any Participant, any holder or
      beneficiary of any Award, any stockholder of the Company and any Eligible
      Individual.

     

    (b)  Delegation.
      Subject
      to the terms of the Plan and applicable law, the Committee may delegate to
      one
      or more officers of the Company the authority, subject to such terms and
      limitations as the Committee shall determine, to grant Awards to, or to cancel,
      modify or waive rights with respect to, or to alter, discontinue, suspend,
      or
      terminate Awards held by, Eligible Individuals who are not officers or directors
      of the Company for purposes of Section 16 of the Exchange Act, or any successor
      section thereto, or who are otherwise not subject to such Section.

     

    SECTION
      4  

     

    Eligibility.
      Any
      Eligible Individual shall be eligible to be granted an Award.

     

    SECTION
      5  

     

    (a)  -Shares
      Available for Awards.
      Subject
      to adjustment as provided in Section 5(b):

     

    (i)  Calculation
      of Number of Shares Available.

     

    (A)  The
      number of Shares with respect to which Awards payable in Shares may be granted
      under the Plan shall be 775,000. Awards that by their terms may be settled
      only
      in cash shall not be counted against the maximum number of Shares provided
      herein.

     

    (B)  Grants
      of
      Stock Appreciation Rights, Limited Rights and Other Stock-Based Awards not
      granted in tandem with Options and payable only in cash may relate to no more
      than 775,000 Shares.

     

    (C)  To
      the
      extent any Shares covered by an Award are not issued because the Award is
      forfeited or cancelled or the Award is settled in cash, such Shares shall again
      be available for grant pursuant to new Awards under the Plan.

     

    (ii)  Sources
      of Shares Deliverable Under Awards.
      Any
      Shares delivered pursuant to an Award may consist of authorized and unissued
      Shares or of treasury Shares, including Shares held by the Company or a
      Subsidiary and Shares acquired in the open market or otherwise obtained by
      the
      Company or a Subsidiary.

     

    (iii)  Individual
      Limit.
      Any
      provision of the Plan to the contrary notwithstanding, no individual may receive
      in any year Awards under the Plan, whether payable in cash or Shares, that
      relate to more than 230,000 Shares.

     

    (a)  Adjustments.
      In the
      event that the Committee determines that any dividend or other distribution
      (whether in the form of cash, Shares, Subsidiary securities, other securities
      or
      other property), recapitalization, stock split, reverse stock split,
      reorganization, merger, consolidation, split-up, spin-off, combination,
      repurchase or exchange of Shares or other securities of the Company, issuance
      of
      warrants or other rights to purchase Shares or other securities of the Company,
      or other similar corporate transaction or event affects the Shares such that
      an
      adjustment is determined by the Committee to be appropriate to prevent dilution
      or enlargement of the benefits or potential benefits intended to be made
      available under the Plan, then the Committee may, in its sole discretion and
      in
      such manner as it may deem equitable, adjust any or all of (i) the number and
      type of Shares (or other securities or property) with respect to which Awards
      may be granted, (ii) the number and type of Shares (or other securities or
      property) subject to outstanding Awards, and (iii) the grant or exercise price
      with respect to any Award and, if deemed appropriate, make provision for a
      cash
      payment to the holder of an outstanding Award and, if deemed appropriate, adjust
      outstanding Awards to provide the rights contemplated by Section 9(b) hereof;
      provided,
      in each
      case, that with respect to Awards of Incentive Stock Options no such adjustment
      shall be authorized to the extent that such authority would cause the Plan
      to
      violate Section 422(b)(1) of the Code or any successor provision thereto and,
      with respect to all Awards under the Plan, no such adjustment shall be
      authorized to the extent that such authority would be inconsistent with the
      requirements for full deductibility under Section 162(m); and provided further,
      that
      the number of Shares subject to any Award denominated in Shares shall always
      be
      a whole number.

     

    SECTION
      6  

     

    (a)  Stock
      Options.
      Subject
      to the provisions of the Plan, the Committee shall have sole and complete
      authority to determine the Eligible Individuals to whom Options shall be
      granted, the number of Shares to be covered by each Option, the option price
      therefor and the conditions and limitations applicable to the exercise of the
      Option. The Committee shall have the authority to grant Incentive Stock Options,
      Nonqualified Stock Options or both. In the case of Incentive Stock Options,
      the
      terms and conditions of such grants shall be subject to and comply with such
      rules as may be required by Section 422 of the Code, as from time to time
      amended, and any implementing regulations. Except in the case of an Option
      granted in assumption of or substitution for an outstanding award of a company
      acquired by the Company or with which the Company combines, the exercise price
      of any Option granted under this Plan shall not be less than 100% of the fair
      market value of the underlying Shares on the date of grant.

     

    (b)  Exercise.
      Each
      Option shall be exercisable at such times and subject to such terms and
      conditions as the Committee may, in its sole discretion, specify in the
      applicable Award Agreement or thereafter, provided, however, that in no event
      may any Option granted hereunder be exercisable after the expiration of 10
      years
      after the date of such grant. The Committee may impose such conditions with
      respect to the exercise of Options, including without limitation, any condition
      relating to the application of Federal or state securities laws, as it may
      deem
      necessary or advisable.

     

    (c)  Payment.
      No
      Shares shall be delivered pursuant to any exercise of an Option until payment
      in
      full of the option price therefor is received by the Company. Such payment
      may
      be made in cash, or its equivalent, or, if and to the extent permitted by the
      Committee, by applying cash amounts payable by the Company upon the exercise
      of
      such Option or other Awards by the holder thereof or by exchanging whole Shares
      owned by such holder (which are not the subject of any pledge or other security
      interest), or by a combination of the foregoing, provided that the combined
      value of all cash, cash equivalents, cash amounts so payable by the Company
      upon
      exercises of Awards and the fair market value of any such whole Shares so
      tendered to the Company, valued (in accordance with procedures established
      by
      the Committee) as of the effective date of such exercise, is at least equal
      to
      such option price.

     

    SECTION
      7  

     

    (a)  Stock
      Appreciation Rights.
      Subject
      to the provisions of the Plan, the Committee shall have sole and complete
      authority to determine the Eligible Individuals to whom Stock Appreciation
      Rights shall be granted, the number of Shares to be covered by each Award of
      Stock Appreciation Rights, the grant price thereof and the conditions and
      limitations applicable to the exercise thereof. Stock Appreciation Rights may
      be
      granted in tandem with another Award, in addition to another Award, or
      freestanding and unrelated to any other Award. Stock Appreciation Rights granted
      in tandem with or in addition to an Option or other Award may be granted either
      at the same time as the Option or other Award or at a later time. Stock
      Appreciation Rights shall not be exercisable after the expiration of 10 years
      after the date of grant. Except in the case of a Stock Appreciation Right
      granted in assumption of or substitution for an outstanding award of a company
      acquired by the Company or with which the Company combines, the grant price
      of
      any Stock Appreciation Right granted under this Plan shall not be less than
      100%
      of the fair market value of the Shares covered by such Stock Appreciation Right
      on the date of grant or, in the case of a Stock Appreciation Right granted
      in
      tandem with a then outstanding Option or other Award, on the date of grant
      of
      such related Option or Award.

     

    (b)  A
      Stock
      Appreciation Right shall entitle the holder thereof to receive upon exercise,
      for each Share to which the SAR relates, an amount equal to the excess, if
      any,
      of the fair market value of a Share on the date of exercise of the Stock
      Appreciation Right over the grant price. Any Stock Appreciation Right shall
      be
      settled in cash, unless the Committee shall determine at the time of grant
      of a
      Stock Appreciation Right that it shall or may be settled in cash, Shares or
      a
      combination of cash and Shares.

     

    SECTION
      8  

     

    (a)  Limited
      Rights.
      Subject
      to the provisions of the Plan, the Committee shall have sole and complete
      authority to determine the Eligible Individuals to whom Limited Rights shall
      be
      granted, the number of Shares to be covered by each Award of Limited Rights,
      the
      grant price thereof and the conditions and limitations applicable to the
      exercise thereof. Limited Rights may be granted in tandem with another Award,
      in
      addition to another Award, or freestanding and unrelated to any Award. Limited
      Rights granted in tandem with or in addition to an Award may be granted either
      at the same time as the Award or at a later time. Limited Rights shall not
      be
      exercisable after the expiration of 10 years after the date of grant and shall
      only be exercisable during a period determined at the time of grant by the
      Committee beginning not earlier than one day and ending not more than ninety
      days after the expiration date of an Offer. Except in the case of a Limited
      Right granted in assumption of or substitution for an outstanding award of
      a
      company acquired by the Company or with which the Company combines, the grant
      price of any Limited Right granted under this Plan shall not be less than 100%
      of the fair market value of the Shares covered by such Limited Right on the
      date
      of grant or, in the case of a Limited Right granted in tandem with a then
      outstanding Option or other Award, on the date of grant of such related Option
      or Award.

     

    (b)  A
      Limited
      Right shall entitle the holder thereof to receive upon exercise, for each Share
      to which the Limited Right relates, an amount equal to the excess, if any,
      of
      the Offer Price on the date of exercise of the Limited Right over the grant
      price. Any Limited Right shall be settled in cash, unless the Committee shall
      determine at the time of grant of a Limited Right that it shall or may be
      settled in cash, Shares or a combination of cash and Shares.

     

    SECTION
      9  

     

    (a)  Other
      Stock-Based Awards.
      The
      Committee is hereby authorized to grant to Eligible Individuals an “Other
      Stock-Based Award”, which shall consist of an Award, the value of which is based
      in whole or in part on the value of Shares, that is not an instrument or Award
      specified in Sections 6 through 8 of this Plan. Other Stock-Based Awards may
      be
      awards of Shares or may be denominated or payable in, valued in whole or in
      part
      by reference to, or otherwise based on or related to, Shares (including, without
      limitation, securities convertible or exchangeable into or exercisable for
      Shares), as deemed by the Committee consistent with the purposes of the Plan.
      The Committee shall determine the terms and conditions of any such Other
      Stock-Based Award and may provide that such awards would be payable in whole
      or
      in part in cash. Except in the case of an Other Stock-Based Award granted in
      assumption of or in substitution for an outstanding award of a company acquired
      by the Company or with which the Company combines, the price at which securities
      may be purchased pursuant to any Other Stock-Based Award granted under this
      Plan, or the provision, if any, of any such Award that is analogous to the
      purchase or exercise price, shall not be less than 100% of the fair market
      value
      of the securities to which such Award relates on the date of grant.

     

    (b)  Dividend
      Equivalents.
      In the
      sole and complete discretion of the Committee, an Award, whether made as an
      Other Stock-Based Award under this Section 9 or as an Award granted pursuant
      to
      Sections 6 through 8 hereof, may provide the holder thereof with dividends
      or
      dividend equivalents, payable in cash, Shares, Subsidiary securities, other
      securities or other property on a current or deferred basis.

     

    SECTION
      10  

     

    (a)  Amendments
      to the Plan.
      The
      Board may amend, suspend or terminate the Plan or any portion thereof at any
      time, provided that no amendment shall be made without stockholder approval
      if
      such approval is necessary to comply with any tax or regulatory requirement,
      including for these purposes any approval necessary to qualify Awards as
“performance based” compensation under Section 162(m) or any successor provision
      if such qualification is deemed necessary or advisable by the Committee.
      Notwithstanding anything to the contrary contained herein, the Committee may
      amend the Plan in such manner as may be necessary for the Plan to conform with
      local rules and regulations in any jurisdiction outside the United
      States.

     

    (b)  Adjustment
      of Awards Upon the Occurrence of Certain Unusual or Nonrecurring
      Events.
      The
      Committee is hereby authorized to make adjustments in the terms and conditions
      of, and the criteria included in, Awards in recognition of unusual or
      nonrecurring events (including, without limitation, the events described in
      Section 5(b) hereof) affecting the Company, or the financial statements of
      the
      Company or any Subsidiary, or of changes in applicable laws, regulations, or
      accounting principles, whenever the Committee determines that such adjustments
      are appropriate to prevent dilution or enlargement of the benefits or potential
      benefits intended to be made available under the Plan.

     

    (c)  Cancellation.
      Any
      provision of this Plan or any Award Agreement to the contrary notwithstanding,
      the Committee may cause any Award granted hereunder to be canceled in
      consideration of a cash payment or alternative Award made to the holder of
      such
      canceled Award equal in value to such canceled Award. The determinations of
      value under this subparagraph shall be made by the Committee in its sole
      discretion.

     

    SECTION
      11  

     

    (a)  Award
      Agreements.
      Each
      Award hereunder shall be evidenced by a writing delivered to the Participant
      that shall specify the terms and conditions thereof and any rules applicable
      thereto, including but not limited to the effect on such Award of the death,
      retirement or other termination of employment of the Participant and the effect
      thereon, if any, of a change in control of the Company.

     

    (b)  Withholding.
      

     

    (i)  (i)
      A
      Participant shall be required to pay to the Company, and the Company shall
      have
      the right to deduct from all amounts paid to a Participant (whether under the
      Plan or otherwise), any taxes required by law to be paid or withheld in respect
      of Awards hereunder to such Participant. The Committee may provide for
      additional cash payments to holders of Awards to defray or offset any tax
      arising from the grant, vesting, exercise or payment of any Award.

     

    (ii)  At
      any
      time that a Participant is required to pay to the Company an amount required
      to
      be withheld under the applicable tax laws in connection with the issuance of
      Shares under the Plan, the Participant may, if permitted by the Committee,
      satisfy this obligation in whole or in part by electing (the “Election”) to have
      the Company withhold from the issuance Shares having a value equal to the
      minimum amount required to be withheld. The value of the Shares withheld shall
      be based on the fair market value of the Shares on the date as of which the
      amount of tax to be withheld shall be determined in accordance with applicable
      tax laws (the “Tax Date”).

     

    (iii)  If
      permitted by the Committee, a Participant may also satisfy up to his or her
      total tax liability related to an Award by delivering Shares owned by the
      Participant, which Shares may be subject to holding period requirements
      determined by the Committee. The value of the Shares delivered shall be based
      on
      the fair market value of the Shares on the Tax Date. 

     

    (iv)  Each
      Election to have Shares withheld must be made prior to the Tax Date. If a
      Participant wishes to deliver Shares in payment of taxes, the Participant must
      so notify the Company prior to the Tax Date.

     

    (c)  Transferability.
      No
      Awards granted hereunder may be transferred, pledged, assigned or otherwise
      encumbered by a Participant except: (i) by will; (ii) by the laws of descent
      and
      distribution; (iii) pursuant to a domestic relations order, as defined in the
      Code, if permitted by the Committee and so provided in the Award Agreement
      or an
      amendment thereto; or (iv) if permitted by the Committee and so provided in
      the
      Award Agreement or an amendment thereto, Options and Limited Rights granted
      in
      tandem therewith may be transferred or assigned (a) to Immediate Family Members,
      (b) to a partnership in which Immediate Family Members, or entities in which
      Immediate Family Members are the owners, members or beneficiaries, as
      appropriate, are the partners, (c) to a limited liability company in which
      Immediate Family Members, or entities in which Immediate Family Members are
      the
      owners, members or beneficiaries, as appropriate, are the members, or (d) to
      a
      trust for the benefit of Immediate Family Members; provided, however, that
      no
      more than a de
      minimus
      beneficial interest in a partnership, limited liability company or trust
      described in (b), (c) or (d) above may be owned by a person who is not an
      Immediate Family Member or by an entity that is not beneficially owned solely
      by
      Immediate Family Members. “Immediate Family Members” shall be defined as the
      spouse and natural or adopted children or grandchildren of the Participant
      and
      their spouses. To the extent that an Incentive Stock Option is permitted to
      be
      transferred during the lifetime of the Participant, it shall be treated
      thereafter as a Nonqualified Stock Option. Any attempted assignment, transfer,
      pledge, hypothecation or other disposition of Awards, or levy of attachment
      or
      similar process upon Awards not specifically permitted herein, shall be null
      and
      void and without effect. The designation of a Designated Beneficiary shall
      not
      be a violation of this Section 11(c).

     

    (d)  Share
      Certificates.
      All
      certificates for Shares or other securities delivered under the Plan pursuant
      to
      any Award or the exercise thereof shall be subject to such stop transfer orders
      and other restrictions as the Committee may deem advisable under the Plan or
      the
      rules, regulations, and other requirements of the SEC, any stock exchange upon
      which such Shares or other securities are then listed, and any applicable
      federal or state laws, and the Committee may cause a legend or legends to be
      put
      on any such certificates to make appropriate reference to such
      restrictions.

     

    (e)  No
      Limit on Other Compensation Arrangements.
      Nothing
      contained in the Plan shall prevent the Company from adopting or continuing
      in
      effect other compensation arrangements, which may, but need not, provide for
      the
      grant of options, stock appreciation rights and other types of Awards provided
      for hereunder (subject to stockholder approval of any such arrangement if
      approval is required), and such arrangements may be either generally applicable
      or applicable only in specific cases.

     

    (f)  No
      Right to Employment.
      The
      grant of an Award shall not be construed as giving a Participant the right
      to be
      retained in the employ of or as a consultant or adviser to the Company or any
      Subsidiary or in the employ of or as a consultant or adviser to any other entity
      providing services to the Company. The Company or any Subsidiary or any such
      entity may at any time dismiss a Participant from employment, or terminate
      any
      arrangement pursuant to which the Participant provides services to the Company
      or a Subsidiary, free from any liability or any claim under the Plan, unless
      otherwise expressly provided in the Plan or in any Award Agreement. No Eligible
      Individual or other person shall have any claim to be granted any Award, and
      there is no obligation for uniformity of treatment of Eligible Individuals,
      Participants or holders or beneficiaries of Awards.

     

    (g)  Governing
      Law.
      The
      validity, construction, and effect of the Plan, any rules and regulations
      relating to the Plan and any Award Agreement shall be determined in accordance
      with the laws of the State of Delaware.

     

    (h)  Severability.
      If any
      provision of the Plan or any Award is or becomes or is deemed to be invalid,
      illegal, or unenforceable in any jurisdiction or as to any Person or Award,
      or
      would disqualify the Plan or any Award under any law deemed applicable by the
      Committee, such provision shall be construed or deemed amended to conform to
      applicable laws, or if it cannot be construed or deemed amended without, in
      the
      determination of the Committee, materially altering the intent of the Plan
      or
      the Award, such provision shall be stricken as to such jurisdiction, Person
      or
      Award and the remainder of the Plan and any such Award shall remain in full
      force and effect.

     

    (i)  No
      Trust or Fund Created.
      Neither
      the Plan nor any Award shall create or be construed to create a trust or
      separate fund of any kind or a fiduciary relationship between the Company and
      a
      Participant or any other Person. To the extent that any Person acquires a right
      to receive payments from the Company pursuant to an Award, such right shall
      be
      no greater than the right of any unsecured general creditor of the
      Company.

     

    (j)  No
      Fractional Shares.
      No
      fractional Shares shall be issued or delivered pursuant to the Plan or any
      Award, and the Committee shall determine whether cash, other securities or
      other
      property shall be paid or transferred in lieu of any fractional Shares or
      whether such fractional Shares or any rights thereto shall be canceled,
      terminated, or otherwise eliminated.

     

    (k)  Compliance
      with Law.
      The
      Company intends that Awards granted under the Plan, or any deferrals thereof,
      will comply with the requirements of Section 409A of the Code and all
      regulations and guidance promulgated thereunder, to the extent
      applicable.

     

    (l)  Headings.
      Headings are given to the subsections of the Plan solely as a convenience to
      facilitate reference. Such headings shall not be deemed in any way material
      or
      relevant to the construction or interpretation of the Plan or any provision
      thereof.

     

    SECTION
      12  

     

    Term
      of the Plan.
      Subject
      to Section 11(a), no Awards may be granted under the Plan later than November
      17, 2008, which is ten years after the date the Plan was approved by the
      Company’s stockholders; provided, however, that Awards granted prior to such
      date shall remain in effect until all such Awards
      have either been satisfied, expired or canceled under the terms of the Plan,
      and
      any restrictions imposed on Shares in connection with their issuance under
      the
      Plan have lapsed.Exhibit 10.15

    EXHIBIT
      10.15

     

    McMoRan
      EXPLORATION CO.

    NOTICE
      OF GRANT OF

    NONQUALIFIED
      STOCK OPTIONS

    UNDER
      THE 1998 STOCK OPTION PLAN

    

    

    1.  
(a)       
      Pursuant
      to the McMoRan Exploration Co. 1998 Stock Option Plan (the “Plan”),
      _______________ (the “Optionee”) is hereby granted effective ____________, ____,
      in consideration of future services, Options to purchase from the Company,
      on
      the terms and conditions set forth in this Notice and in the Plan, [ ] Shares
      of
      the Company at a purchase price of $[ ] per Share.

     

    (b)  Defined
      terms not otherwise defined in Section 11 of this Notice shall have the meanings
      set forth in Section 2 of the Plan.

     

    (c)  The
      Options granted hereunder are intended to constitute nonqualified stock options
      and are not intended to constitute incentive stock options within the meaning
      of
      Section 422 of the Internal Revenue Code of 1986, as amended (the
“Code”).

     

    2. 
       (a)       
      All
      Options granted hereunder shall terminate on [ ] unless terminated earlier
      as
      provided in Section 4 of this Notice.

     

    (b)  The
      Options granted hereunder shall become exercisable in installments as
      follows:

     

    Date
      Exercisable  Number
      of Shares

    

    

    

    (c)  The
      Options granted hereunder may be exercised with respect to all or any part
      of
      the Shares comprising each installment as the Optionee may elect at any time
      after such Options become exercisable until the termination date set forth
      in
      Section 2(a) or Section 4, as the case may be.

     

    (d)  Notwithstanding
      the foregoing provisions of this Section 2, the Options granted hereunder shall
      immediately become exercisable in their entirety at such time as there shall
      be
      a Change in Control of the Company.

     

    3.  Upon
      each
      exercise of the Options granted hereunder, the Optionee shall give written
      notice to the Company, which shall specify the number of Shares to be purchased
      and shall be accompanied by payment in full of the aggregate purchase price
      thereof (which payment may be made in Shares owned by the Optionee for at least
      six months), in accordance with procedures established by the Committee. Such
      exercise shall be effective upon receipt by the Company of such notice in good
      order and payment. 

     

    4.  
(a)       
      Except
      as
      set forth in this Section 4, the Options provided for in this Notice shall
      immediately terminate on the date that the Optionee ceases for any reason to
      be
      an Eligible Individual.

     

    (b)  If
      the
      Optionee ceases to be an Eligible Individual for any reason other than death,
      Disability, Retirement or termination for Cause, any Option granted hereunder
      that is then exercisable shall remain exercisable in accordance with the terms
      of this Notice within three months after the date of such cessation, but in
      no
      event shall any such Option be exercisable after the termination date specified
      in Section 2(a). 

     

    (c)  If
      the
      Optionee ceases to be an Eligible Individual by reason of the Optionee’s
      Disability or Retirement, any Option granted hereunder that is exercisable
      on
      the date of such cessation, as well as any Option granted hereunder that would
      have become exercisable within one year after the date of such cessation had
      the
      Optionee continued to be an Eligible Individual, shall remain exercisable in
      accordance with the terms of this Notice within three years after the date
      of
      such cessation, but in no event shall any such Option be exercisable after
      the
      termination date specified in Section 2(a). 

     

    (d)  (i)If
      the
      Optionee ceases to be an Eligible Individual as a result of the Optionee’s
      death, any Option granted hereunder that is exercisable on the date of such
      death, as well as any Option granted hereunder that would have become
      exercisable within one year after the date of such death had the Optionee
      continued to be an Eligible Individual, shall remain exercisable by the
      Optionee’s Designated Beneficiary in accordance with the terms of this Notice
      until the third anniversary of the date of such death, but in no event shall
      any
      such Option be exercisable after the termination date specified in Section
      2(a).

     

    (ii)  If
      the
      Optionee dies after having ceased to be an Eligible Individual and any Option
      granted hereunder is then exercisable in accordance with the provisions of
      this
      Section 4, such Option will remain exercisable by the Optionee’s Designated
      Beneficiary in accordance with the terms of this Notice until the third
      anniversary of the date the Optionee ceased to be an Eligible Individual, but
      in
      no event shall any such Option be exercisable after the termination date
      specified in Section 2(a).

     

    (e)  If
      the
      Optionee ceases to be an Eligible Individual by reason of the Optionee’s
      termination for Cause, any Option granted hereunder that is exercisable on
      the
      date of such cessation shall terminate immediately.

     

    5.  The
      Options granted hereunder are not transferable by the Optionee otherwise than
      by
      will or by the laws of descent and distribution or pursuant to a domestic
      relations order, as defined in the Code, and shall be exercised during the
      lifetime of the Optionee only by the Optionee or by the Optionee’s duly
      appointed legal representative. 

     

    6.  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 its principal office,
      1615 Poydras Street, New Orleans, Louisiana 70112, addressed to the attention
      of
      the Secretary; and, if to the Optionee, shall be delivered personally, mailed
      or
      delivered via e-mail to the Optionee at the address on file with the Company.
      Such addresses may be changed at any time by notice from one party to the other.
      

     

    7.  The
      terms
      of this Notice shall bind and inure to the benefit of the Optionee, the Company
      and the successors and assigns of the Company and, to the extent provided in
      the
      Plan and in this Notice, the Designated Beneficiaries and the legal
      representatives of the Optionee. 

     

    8.  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 Optionee hereunder may not be made without
      the Optionee’s consent. The Committee may amend, modify or terminate this Notice
      and any of the Options granted hereunder at any time prior to exercise in any
      manner not inconsistent with the terms of the Plan, including, without
      limitation, to change the date or dates as of which the Options granted
      hereunder become exercisable. Notwithstanding the foregoing, no such amendment,
      modification or termination may materially impair the rights of the Optionee
      hereunder without the Optionee’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
      Optionee.

     

    9.  The
      Optionee is required to satisfy any obligation in respect of withholding or
      other payroll taxes resulting from the exercise of any Option granted hereunder,
      in accordance with procedures established by the Committee, as a condition
      to
      receiving any certificates for securities resulting from the exercise of any
      such Option.

     

    10.  Nothing
      in this Notice shall confer upon the Optionee 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 Optionee’s
      employment relationship with the Company or any of its Subsidiaries at any
      time.

     

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

     

    (b)  “Change
      in Control” shall mean the earliest of the following events: (i) any person or
      any two or more persons acting as a group, and all affiliates of such person
      or
      persons, shall acquire beneficial ownership of more than 25% of all classes
      and
      series of the Company’s outstanding stock (exclusive of stock held in the
      Company’s treasury or by the Company’s Subsidiaries), taken as a whole, that has
      voting rights with respect to the election of directors of the Company (not
      including any series of preferred stock of the Company that has the right to
      elect directors only upon the failure of the Company to pay dividends) (the
      “Company Stock”) pursuant to a tender offer, exchange offer, purchase or other
      acquisition or series of purchases or other acquisitions, or any combination
      of
      those transactions (a “25% Stock Acquisition”); provided, however, that any 25%
      Stock Acquisition shall not constitute a Change in Control if all of the
      acquiring persons enter into a standstill agreement with the Company in a form
      approved by the Company’s Board of Directors and a majority of the members of
      the Company’s Board of Directors at the time of such approval were also members
      of the Board immediately prior to the 25% Stock Acquisition, or (ii) there
      shall
      be a change in the composition of the Board at any time within two years after
      any tender offer, exchange offer, merger, consolidation, sale of assets or
      contested election, or any combination of those transactions (a “Transaction”),
      such that (A) the persons who were directors of the Company immediately before
      the first such Transaction cease to constitute a majority of the board of
      directors of the corporation that shall thereafter be in control of the
      companies that were parties to or otherwise involved in such Transaction or
      (B)
      the number of persons who shall thereafter be directors of such corporation
      shall be fewer than two-thirds of the number of directors of the Company
      immediately prior to such first Transaction.

     

    (c)  “Disability”
      shall mean long-term disability, as defined in the Company’s long-term
      disability plan.

     

    (d)  “Retirement”
      shall mean early, normal or deferred retirement of the Optionee 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 Optionee that is deemed by
      the
      Committee to constitute a retirement. 

     

    McMoRan
      EXPLORATION CO.

    

    By:
      _________________________

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