COLLATERAL PLEDGE
AND SECURITY AGREEMENT
Dated as of August 7, 2001
among
FCX INVESTMENT LTD.
as Pledgor,
THE BANK OF NEW YORK
as Trustee, and
THE BANK OF NEW YORK
as Collateral Agent
This Collateral Pledge and Security Agreement (as
supplemented from time to time, this "Pledge
Agreement") is made and entered into as of August 7,
2001 among FCX INVESTMENT LTD., a Cayman Islands
exempted company (the "Pledgor"), having its principal
offices at Harbour Centre, 4th Floor, ▇▇▇▇▇▇ Town,
Grand Cayman, Cayman Islands, British West Indies, THE
BANK OF NEW YORK, a New York banking corporation,
having its principal corporate trust office at ▇▇▇
▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ 21 West, New York, New York
10286, as trustee (in such capacity, the "Trustee") for
the holders (the "Holders") of the Notes (as defined
herein) issued by the Pledgor under the Indenture
referred to below, and THE BANK OF NEW YORK, as
collateral agent for the Trustee and the holders from
time to time of the Notes referred to below (in such
capacity, the "Collateral Agent") and securities
intermediary.
W I T N E S S E T H:
WHEREAS, the Pledgor, Freeport-McMoRan Copper &
Gold Inc. (together with the Pledgor, the "Issuers")
and ▇▇▇▇▇▇▇ Lynch, Pierce, ▇▇▇▇▇▇ & ▇▇▇▇▇ Incorporated
(the "Initial Purchaser") are parties to a Purchase
Agreement dated August 1, 2001 (the "Purchase
Agreement"), pursuant to which the Issuers will issue
and sell to the Initial Purchaser $525 million
aggregate principal amount (or up to $603.75 million
aggregate principal amount if the Initial Purchaser's
overallotment option is exercised) of 8 1/4% Convertible
Senior Notes due 2006 (the "Notes");
WHEREAS, the Issuers and The Bank of New York, as
Trustee, have entered into that certain indenture dated
as of the date hereof (as amended, restated,
supplemented or otherwise modified from time to time,
the "Indenture"), pursuant to which the Issuers are
issuing the Notes on the date hereof;
WHEREAS, pursuant to the Indenture, the Pledgor is
required to purchase, or cause the purchase of, and
pledge to the Collateral Agent for the benefit of the
Trustee and the Holders, at the Closing Time (as
defined in the Purchase Agreement) or the relevant Date
of Delivery (as defined in the Purchase Agreement),
U.S. Government Obligations (as defined in the
Indenture) in an amount that will be sufficient upon
receipt of scheduled interest and principal payments of
such securities, in the written opinion of ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇ LLP or another nationally recognized firm of
independent public accountants selected by the Pledgor
and delivered to the Trustee, to provide for payment in
full of the first six scheduled interest payments due
on the Notes (such obligation, together with the
obligation to repay the principal, premium, if any,
interest (including Liquidated Damages, if any), fees,
expenses or otherwise on the Notes and under the
Indenture, this Agreement and any other transaction
document related thereto in the event that the Notes
become due and payable prior to such time as the first
six scheduled interest payments thereon shall have been
paid in full, being collectively referred to herein as
the "Obligations");
WHEREAS, the Pledgor has established an account
(the "Collateral Account") with The Bank of New York,
at its office at ▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇ ▇▇▇▇, ▇▇▇
▇▇▇▇, ▇▇▇ ▇▇▇▇, Account No. 123791, in the name of The
Bank of New York, as Collateral Agent for the benefit
of the trustee and holders of the 8 1/4% Convertible
Senior Notes Due 2006 of Freeport-McMoRan Copper & Gold
Inc. and FCX Investments Ltd. and designated as "BNY
COLL AGT UNDER AGREE DTD 8/7/01"; and
WHEREAS, it is a condition precedent to the
purchase of the Notes by the Initial Purchaser pursuant
to the Purchase Agreement that the Pledgor apply
certain of the proceeds of the offering of the Notes to
purchase the Pledged Securities (as defined below) and
deposit such Pledged Securities into the Collateral
Account to be held therein subject to the terms of this
Pledge Agreement and shall have granted the assignment
and security interest and made the pledge and
assignment contemplated by this Pledge Agreement.
NOW, THEREFORE, in consideration of the premises
herein contained, and in order to induce the Initial
Purchaser to purchase the Notes, the Pledgor, the
Trustee and the Collateral Agent hereby agree, for the
benefit of the Initial Purchaser and for the ratable
benefit of the Holders, as follows:
SECTION 1. Definitions; Appointment; Deposit and
Investment.
1.1 Definitions.
(a) Unless otherwise defined in this Pledge
Agreement, terms defined or referenced in the Indenture
are used in this Pledge Agreement as such terms are
defined or referenced therein.
(b) Unless otherwise defined in the Indenture or
in this Pledge Agreement, terms defined in Article 8 or
9 of the Uniform Commercial Code in effect in the State
of New York ("N.Y. Uniform Commercial Code") from time
to time and/or in Section 357.2 of the Treasury
Regulations (as defined in Section 1.1(c)) are used in
this Pledge Agreement as such terms are defined in such
Article 8 or 9 and/or such Section 357.2.
(c) In this Pledge Agreement, the following terms
have the following meanings (such meanings to be
equally applicable to both the singular and plural
forms of the terms defined):
"Additional Pledged Securities" has the meaning
specified in Section 1.3 hereof.
"Cash Equivalents" means, to the extent owned by
the Pledgor free and clear of all Liens other than
Liens created hereunder, U.S. Government Obligations.
"C.F.R." means U.S. Code of Federal Regulations.
"Closing Time" has the meaning specified in the
Purchase Agreement.
"Collateral" has the meaning specified in Section
1.3 hereof.
"Collateral Account" has the meaning specified in
the recitals of the parties hereof.
"Collateral Agent" has the meaning specified in
the recitals of the parties hereto.
"Collateral Investments" has the meaning specified
in Section 5 hereof.
"Date of Delivery" has the meaning specified in
the Purchase Agreement.
"Entitlement holder" has the meaning specified in
N.Y. Uniform Commercial Code Section 8-102(a)(7) or in
respect of any Book-entry Security, the meaning
specified for "Entitlement Holder" in 31 C.F.R. Section
357.2 or as applicable to such Book-entry Security, the
corresponding federal book-entry regulations.
"FRBNY" means Federal Reserve Bank of New York.
"FRBNY Account" means the Participant's Securities
Account maintained in the name of the Collateral Agent
by the FRBNY.
"FRBNY Member" means any Person that is eligible
to maintain (and that maintains) with the FRBNY one or
more FRBNY Member Securities Accounts in such Person's
name.
"FRBNY Member Securities Account" means, in
respect of any Person, an account in the name of such
Person at the FRBNY, to which account U.S. Government
Obligations held for such Person are or may be
credited.
"Holders" has the meaning specified in the
recitals of the parties hereto.
"Initial Pledged Securities" has the meaning
specified in Section 1.3 hereof.
"Issuer Order" has the meaning specified in
Section 6(a) hereof.
"Notes" has the meaning specified in the recitals
of the parties hereof.
"N.Y. Uniform Commercial Code" has the meaning
specified in Section 1.1(b).
"Obligations" has the meaning specified in the
recitals of the parties hereof.
"Initial Purchaser" has the meaning specified in
the recitals of the parties hereof.
"Purchase Agreement" has the meaning specified in
the recitals of the parties hereof.
"Pledged Securities" has the meaning specified in
Section 1.3 hereof.
"Pledgor" has the meaning specified in the
recitals of the parties hereto.
"Pledgor Funds" has the meaning specified in
Section 6(b) hereof.
"Pledgor's Designee" has the meaning specified in
Section 6(b) hereof.
"Securities intermediary" means a Person that is a
"securities intermediary" (as defined in N.Y. Uniform
Commercial Code Section 8-102(a)(14)) and, in respect
of any Book-entry Security, a "Securities Intermediary"
(as defined in 31 C.F.R. Section 357.2 or, as
applicable to such Book-entry Security, as defined in
the corresponding federal book-entry regulations).
"Security" has the meaning specified in Section
8-102(a)(15) of the N.Y. Uniform Commercial Code or, in
respect of any Book-entry Security, has the meaning
specified for "Security" in 31 C.F.R. Section 357.2 (or
as applicable to such Book-entry Security, the
corresponding federal book-entry regulations).
"Security entitlement" has the meaning specified
in N.Y. Uniform Commercial Code Section 8-102(a)(17)
or, in respect of any Book-entry Security, has the
meaning specified for "Security Entitlement" in 31
C.F.R. Section 357.2 (or, as applicable to such
Book-entry Security, the corresponding federal
book-entry regulations).
"Settlement Date" means, as to any U.S. Government
Obligations, the date on which the purchase of such
U.S. Government Obligations shall have been settled.
"Supplement" has the meaning specified in Section
1.3 hereof, and shall substantially in the form of
Exhibit B hereto.
"Termination Date" means the earlier of (a) the
date of the payment in full in cash of each of the
first six scheduled interest payments due on the Notes
under the terms of the Indenture and (b) the date of
the payment in full in cash of all obligations due and
owing under this Pledge Agreement, the Indenture and
the Notes, in the event such obligations become due and
payable prior to the payment of the first six scheduled
interest payments on the Notes.
"Treasury Regulations" means (a) the federal
regulations contained in 31 C.F.R. Part 357 (including,
without limitation, Section 357.2, Section 357.10
through Section 357.14 and Section 357.41 through
Section 357.44 of 31 C.F.R.) and (b) to the extent
substantially identical to the federal regulations
referred to in clause (a) above (as in effect from time
to time) the federal regulations governing other U.S.
Government Obligations.
"Trustee" has the meaning specified in the
recitals of parties hereto.
"Uncertificated Security" has the meaning
specified in Section 8-102(a)(18) of the N.Y. Uniform
Commercial Code.
1.2 Appointment of the Collateral Agent. The
Trustee hereby appoints the Collateral Agent as
Collateral Agent in accordance with the terms and
conditions set forth herein and the Collateral Agent
hereby accepts such appointment.
1.3 Pledge and Grant of Security Interest. As
security for the prompt and complete payment and
performance when due (whether at the stated maturity,
by acceleration or otherwise) of the Obligations, the
Pledgor hereby assigns and pledges to the Collateral
Agent for the benefit of the Trustee and the ratable
benefit of the Holders and hereby grants to the
Collateral Agent for the benefit of the Trustee and for
the ratable benefit of the Holders, a lien on and
security interest in all of the Pledgor's right, title
and interest in, to and under the following property:
(a) (i) the U.S. Government Obligations identified by
CUSIP No. in Part I of Schedule I to this Pledge
Agreement (the "Initial Pledged Securities") and (ii)
the U.S. Government Obligations, if any, identified by
CUSIP No. in a supplement or supplements (each, a
"Supplement," the form of which is attached hereto as
Exhibit B) to the Pledge Agreement (the "Additional
Pledged Securities" and, together with the Initial
Pledged Securities, the "Pledged Securities") and the
certificates representing the Pledged Securities (if
any), the scheduled payments of principal and interest
thereon which will be sufficient to provide for payment
in full of the first six scheduled interest payments
due on the Notes, (b) the security entitlements
described in Part II of said Schedule I and in each
Supplement to the Pledge Agreement, if any, with
respect to the financial assets described, the
securities intermediary named, and the securities
account referred to therein, (c) the Collateral
Account, all security entitlements from time to time
carried in the Collateral Account, all funds held
therein and all certificates and instruments, if any,
from time to time representing or evidencing the
Collateral Account, (d) all Collateral Investments (as
hereinafter defined) from time to time and all
certificates and instruments, if any, representing or
evidencing the Collateral Investments, and any and all
security entitlements to the Collateral Investments,
and any and all related securities accounts in which
any security entitlements to the Collateral Investments
is carried, (e) all notes, certificates of deposit,
deposit accounts, checks and other instruments, if any,
from time to time hereafter delivered to or otherwise
possessed by the Collateral Agent for or on behalf of
the Pledgor and specifically designated by the Pledgor
to be in substitution for any or all of the then
existing Collateral, (f) all interest, dividends, cash,
instruments and other property, if any, from time to
time received, receivable or otherwise distributed in
respect of or in exchange for any or all of the then
existing Collateral and (g) all proceeds of any and all
of the foregoing Collateral (including, without
limitation, proceeds that constitute property of the
types described in clauses (a)-(f) of this Section 1.3)
and, to the extent not otherwise included, all (i)
payments under insurance (whether or not the Trustee is
the loss payee thereof) or any indemnity, warranty or
guaranty, payable by reason of loss or damage to or
otherwise with respect to any of the foregoing
Collateral and (ii) cash proceeds of any and all of the
foregoing Collateral (such property described in
clauses (a) through (g) of this Section 1.3 being
collectively referred to herein as the "Collateral").
Without limiting the generality of the foregoing, this
Pledge Agreement secures the payment of all amounts
that constitute part of the Obligations and would be
owed by the Pledgor to the Trustee under the Notes, the
Indenture, this Pledge Agreement and any other
transaction documents related thereto but for the fact
that they are unenforceable or not allowable due to the
existence of a bankruptcy, reorganization or similar
proceeding involving the Pledgor.
SECTION 2. Establishment and Maintenance of
Collateral Accounts.
(a) Prior to or concurrently with the execution
and delivery hereof, the Collateral Agent shall
establish the Collateral Account on its books as a
separate account segregated from all other custodial or
collateral accounts at its office at The Bank of New
York, ▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇.
The Pledgor and the Collateral Agent will maintain the
Collateral Account as a securities account with The
Bank of New York in the State of New York.
The following provisions shall apply to the
establishment and maintenance of the Collateral
Account:
(i) The Collateral Agent shall cause the
Collateral Account to be, and the Collateral
Account shall be, separate from all other
accounts maintained by the Collateral Agent.
(ii) The Collateral Agent shall, in
accordance with all applicable laws, have
sole dominion and control over the Collateral
Account.
(iii) It shall be a term and condition of the
Collateral Account and the Pledgor
irrevocably instructs the Collateral Agent,
notwithstanding any other term or condition
to the contrary in any other agreement, that
no amount (including interest on Collateral
Investments) shall be released to or for the
account of, or withdrawn by or for the
account of, the Pledgor or any other Person
except as expressly provided in this Pledge
Agreement.
(b) On (i) the Closing Time and (ii) the relevant
Date of Delivery, if any, the Pledgor shall transfer,
or cause to be transferred, to the Collateral Agent, in
the case of (i), an amount equal to $139,761,972.57 or,
in the case of (ii), an additional amount in cash to be
set forth in the relevant Supplement to the Pledge
Agreement, which amount shall be sufficient for the
Collateral Agent to purchase the Additional Pledged
Securities, in each case by depositing all such funds
into the Collateral Account. The Collateral Account
shall be subject to such applicable laws, and such
applicable regulations of the Board of Governors of the
Federal Reserve System and of any other appropriate
banking or governmental authority, as may now or
hereafter be in effect.
(c) As soon as practicably possible after receipt
of the amount referred to in Section 2(b) (and not
later than the Business Day following (A) the Closing
Time or (B) the relevant Date of Delivery, as the case
may be), (i) the Collateral Agent shall apply such
amount to purchase (1) in the case of (A) above, the
U.S. Government Obligations (in the name of the
Collateral Agent) listed on Schedule I hereto, or (2)
in the case of (B) above, the U.S. Government
Obligations (in the name of the Collateral Agent)
listed on the relevant Supplement to the Pledge
Agreement hereto, and, in each case, credit such U.S.
Government Obligations to the Collateral Account as
Collateral hereunder; and (ii) the Collateral Agent
shall ensure that, on the Settlement Date of such U.S.
Government Obligations, the FRBNY indicates by
book-entry that those U.S. Government Obligations being
settled on such date are credited to the FRBNY Account.
(d) The Collateral Agent will, from time to time,
reinvest the proceeds of Collateral that may mature or
be sold in such Collateral Investments (in the name of
the Collateral Agent) as it may be directed in writing
by the Pledgor, and cause such Collateral Investments
to be credited to the Collateral Account as Collateral
hereunder. Any such proceeds that the Pledgor directs
the Collateral Agent in writing not to reinvest in
Collateral Investments shall be held in the Collateral
Account.
SECTION 3. Delivery and Control of Collateral. (a)
All certificates or instruments representing or
evidencing Collateral shall be delivered to and held by
or on behalf of the Collateral Agent pursuant hereto
and shall be in suitable form for transfer or delivery,
or, at the request of the Collateral Agent, shall be
accompanied by duly executed instruments of transfer or
assignment in blank. In addition, the Collateral Agent
shall have the right at any time to exchange
certificates or instruments representing or evidencing
Collateral for certificates or instruments of smaller
or larger denominations.
(b) With respect to any Collateral that
constitutes a security and is not represented or
evidenced by a certificate or instrument, the Pledgor
shall cause the issuer thereof either (i) to register
the Collateral Agent as the registered owner of such
security or (ii) to agree in writing with the
Collateral Agent and the Pledgor that such issuer will
comply with instructions with respect to such security
originated by the Collateral Agent without further
consent of the Pledgor, the terms of such agreement to
be consistent with the terms of this Agreement (if
applicable).
(c) With respect to any Collateral that
constitutes a security entitlement, the Pledgor shall
cause the securities intermediary with respect to such
security entitlement either (i) to identify in its
records the Collateral Agent as the entitlement holder
of such security entitlement against such securities
intermediary or (ii) to agree in writing with the
Pledgor and the Collateral Agent that such securities
intermediary will comply with entitlement orders (that
is, notifications communicated to such securities
intermediary directing transfer or redemption of the
financial asset to which Pledgor has a security
entitlement) originated by the Collateral Agent without
further consent of the Pledgor, the terms of such
agreement to be consistent with the terms of this
Agreement (if applicable).
(d) With respect to any Collateral that
constitutes a securities account, the Pledgor will
comply with subsection (c) of this Section 3 with
respect to all security entitlements carried in such
securities account.
(e) Concurrently with the execution and delivery
of this Pledge Agreement, the Collateral Agent is
delivering, and concurrently with the execution and
delivery of any Supplement to the Pledge Agreement, the
Collateral Agent will deliver, to the Pledgor and the
Initial Purchaser a duly executed certificate, in the
form of Exhibit A hereto, of an officer of the
Collateral Agent.
(f) [RESERVED]
(g) Concurrently with the execution and delivery
of this Pledge Agreement, the Pledgor is delivering,
and concurrently with the execution and delivery of any
Supplement to the Pledge Agreement, the Pledgor will
deliver, to the Collateral Agent financing statements
in form acceptable for filing under the N.Y. Uniform
Commercial Code and the Uniform Commercial Code of the
District of Columbia, covering the Collateral described
in this Pledge Agreement.
SECTION 4. Delivery of Collateral Other than U.S.
Government Obligations. (a) Collateral consisting of
cash will be deemed to be delivered to the Collateral
Agent (such that the Collateral Agent will have an
enforceable lien and security interest thereon and
therein) when it has been (and for so long as it shall
remain) deposited in or credited to the Collateral
Account.
(b) Collateral consisting of Cash Equivalents
(other than U.S. Government Obligations) will be deemed
to be delivered to the Collateral Agent (such that the
Collateral Agent will have an enforceable lien and
security interest thereon and therein) when they have
been (and for so long as they shall remain) deposited
in or credited to the Collateral Account.
(c) Collateral consisting of uncertificated
securities (other than U.S. Government Obligations)
will be deemed delivered to the Collateral Agent when
the Collateral Agent (A) shall indicate by book entry
that such securities have been credited to the
Collateral Account or (B) shall receive such security
(or a financial asset based on such security) for the
Collateral Account from or at the direction of the
Pledgor, and shall accept such security (or such
financial asset) for credit to the Collateral Account.
(d) Collateral consisting of securities, and
represented or evidenced by certificates or
instruments, will be deemed delivered to the Collateral
Agent when all such certificates or instruments
representing or evidencing the Collateral, including,
without limitation, amounts invested as provided in
Section 5, shall be delivered to the Collateral Agent
and held by or on behalf of the Collateral Agent
pursuant hereto and shall be in registered form and
specially indorsed to the Collateral Agent by an
effective indorsement, all in form and substance
sufficient to convey a valid security interest in such
Collateral to the Collateral Agent or shall be credited
to the Collateral Account.
SECTION 5. Investing of Amounts in the Collateral
Accounts. The Collateral Agent shall advise the Pledgor
if, at any time, any amounts shall exist in the
Collateral Account uninvested, and if directed in
writing by the Pledgor, the Collateral Agent will,
subject to the provisions of Section 6 and Section 13,
(a) invest such amounts on deposit in the
Collateral Accounts in such Cash Equivalents in the
name of the Collateral Agent as the Pledgor may select
and
(b) invest interest paid on the Cash Equivalents
referred to in clause (a) above, and reinvest other
proceeds of any such Cash Equivalents that may mature
or be sold, in each case in such Cash Equivalents in
the name of the Collateral Agent, as the Pledgor may
select (the Cash Equivalents referred to in clauses (a)
and (b) above, together with the Pledged Securities,
being collectively referred to herein as "Collateral
Investments"); provided, however, that the amount in
cash and Pledged Securities on deposit in the
Collateral Account, collectively, at any time during
the term of this Pledge Agreement, is sufficient to
provide for the payment in full of the remaining
interest payments at such time on the Notes up to and
including the sixth scheduled interest payment.
Interest and proceeds that are not invested or
reinvested in Collateral Investments as provided above
shall be deposited and held in the Collateral Account.
Except as otherwise provided in Sections 11 and 12, the
Collateral Agent shall not be liable for any loss in
the investment or reinvestment of amounts held in the
Collateral Account. The Collateral Agent is not at any
time under any duty to advise or make any
recommendation for the purchase, sale, retention or
disposition of the Collateral Investments.
SECTION 6. Disbursements. The Collateral Agent
shall hold the Collateral in the Collateral Account and
release the same, or a portion thereof, only as
follows:
(a) Prior to each of the first six scheduled
interest payments on the Notes, the Collateral Agent
shall release from the Collateral Accounts an amount
sufficient to pay the interest due on the Notes on such
interest payment date and will take any action
necessary to provide for the payment of the interest on
the Notes to the Holders in accordance with the payment
provisions of the Indenture from (and to the extent of)
proceeds of the Collateral in the Collateral Account.
Nothing in this Section 6 shall affect the Collateral
Agent's rights to apply the Collateral to the payments
of amounts due on the Notes upon acceleration thereof.
(b) If, prior to the date on which the sixth
scheduled interest payment on the Notes is due:
(i) an Event of Default under the Notes
occurs and is continuing and
(ii) the Trustee or the Holders of 25% in
aggregate principal amount of the Notes
accelerate the Notes by declaring the
principal amount of the Notes to be
immediately due and payable in
accordance with the provisions of the
Indenture, except for the occurrence and
continuance of an Event of Default under
Section 6.01(f) and (g) of the
Indenture, upon which the Notes will be
accelerated automatically pursuant to
the Indenture,
then the Collateral Agent shall promptly, subject to
applicable bankruptcy laws, release the proceeds from
the Collateral Account to the Holders of the Notes.
Distributions from the Collateral Account shall be
applied, for the ratable benefit of the Holders, as
follows:
(x) first, to any accrued and unpaid
interest on the Notes and
(y) second, to the extent available, to the
repayment of the remaining Obligations,
including the principal amount of the
Notes.
Any surplus of such proceeds held by the
Collateral Agent and remaining after payment in full of
all of the Obligations shall be paid over to the
Pledgor.
(c) [RESERVED]
(d) [RESERVED]
(e) In the event that the Collateral held in the
Collateral Account exceeds 100% of the amount
sufficient, in the opinion of ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ LLP or
another nationally recognized firm of independent
public accountants selected by the Pledgor, to provide
for payment in full of the first six scheduled interest
payments due on the Notes (or, in the event an interest
payment or payments have been made, an amount
sufficient to provide for payment in full of all
interest payments remaining, up to and including the
sixth scheduled interest payment), the Collateral Agent
shall release to the Pledgor, at the Pledgor's written
request, accompanied by an opinion prepared by ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇ LLP or such other nationally recognized firm
of independent public accountants, any such excess
Collateral.
(f) Upon the release of any Collateral from the
Collateral Account, in accordance with the terms of
this Pledge Agreement, the security interest evidenced
by this Pledge Agreement in such released Collateral
will automatically terminate and be of no further force
and effect.
(g) Except as expressly provided in this Section
6, nothing contained in this Pledge Agreement shall (i)
afford the Pledgor any right to issue entitlement
orders with respect to any security entitlement to the
Pledged Securities or Collateral Investments or any
securities account in which any such security
entitlement may be carried, or otherwise afford the
Pledgor control of any such security entitlement or
(ii) otherwise give rise to any rights of the Pledgor
with respect to the Collateral Investments, any
security entitlement thereto or any securities account
in which any such security entitlement may be carried,
other than the Pledgor's rights under this Pledge
Agreement as the beneficial owner of Collateral pledged
to and subject to the exclusive dominion and control
(including, without limitation, securities control) of
the Collateral Agent in its capacity as such (and not
as a securities intermediary). The Pledgor
acknowledges, confirms and agrees that the Collateral
Agent holds a security entitlement to the Collateral
Investments solely as collateral agent for the Trustee
and the Holders and not as a securities intermediary
for the Pledgor.
SECTION 7. Representations and Warranties. The
Pledgor hereby represents and warrants, as of the date
hereof, that:
(a) The execution and delivery by the Pledgor of,
and the performance by the Pledgor of its obligations
under, this Pledge Agreement will not contravene any
provision of applicable law or the certificate of
incorporation, bylaws or equivalent organizational
instruments of the Pledgor or any material agreement or
other material instrument binding upon the Pledgor or
any of its subsidiaries or any judgment, order or
decree of any governmental body, agency or court having
jurisdiction over the Pledgor or any of its
subsidiaries, or result in the creation or imposition
of any Lien on any assets of the Pledgor, except for
the lien and security interests granted under this
Pledge Agreement; no consent, approval, authorization
or order of, or qualification with, and no notice to or
filing with, any governmental body or agency or other
third party is required (i) for the performance by the
Pledgor of its obligations under this Pledge Agreement,
(ii) for the pledge by the Pledgor of the Collateral
pursuant to this Pledge Agreement or for the execution,
delivery or performance of this Agreement by the
Pledgor or (iii) for the perfection or maintenance of
the pledge, assignment and security interest created
hereby (including the first priority nature of such
pledge, assignment or security interest), except for
the filing of financing and continuation statements
under the Uniform Commercial Code of applicable
jurisdictions which financing statements have been
delivered pursuant to Section 3(g) hereof, or (iv)
except for any such consents, approvals, authorizations
or orders required to be obtained by the Collateral
Agent (or the Holders) for reasons other than the
consummation of this transaction, for the exercise by
the Collateral Agent of the rights provided for in this
Pledge Agreement or the remedies in respect of the
Collateral pursuant to this Pledge Agreement.
(b) The Pledgor is the legal and beneficial owner
of the Collateral, free and clear of any Lien or claims
of any Person (except for the lien and security
interests granted under this Pledge Agreement). No
effective financing statement or other instrument
similar in effect covering all or any part of the
Collateral is on file in any public office other than
the financing statements, if any, to be filed pursuant
to this Pledge Agreement.
(c) This Pledge Agreement has been duly
authorized, validly executed and delivered by the
Pledgor and (assuming the due authorization and valid
execution and delivery of this Pledge Agreement by each
of the Trustee and the Collateral Agent and
enforceability of the Pledge Agreement against each of
the Trustee and the Collateral Agent in accordance with
its terms) constitutes a valid and binding agreement of
the Pledgor, enforceable against the Pledgor in
accordance with its terms, except as (i) the
enforceability hereof may be limited by bankruptcy,
insolvency, fraudulent conveyance, preference,
reorganization, moratorium or similar laws now or
hereafter in effect relating to or affecting the rights
or remedies of creditors generally, (ii) the
availability of equitable remedies may be limited by
equitable principles of general applicability and the
discretion of the court before which any proceeding
therefor may be brought, (iii) the exculpation
provisions and rights to indemnification hereunder may
be limited by U.S. federal and state securities laws
and public policy considerations and (iv) the waiver of
rights and defenses contained in Section 13(b), Section
17.11 and Section 17.15 hereof may be limited by
applicable law.
(d) Upon the delivery to the Collateral Agent of
the Collateral in accordance with the terms hereof and
the filing of the financing statements referred to in
Section 3(g) hereof, the pledge of and grant of a
security interest in the Collateral securing the
payment of the Obligations for the benefit of the
Trustee and the Holders will constitute a valid, first
priority, perfected security interest in such
Collateral (except, with respect to proceeds, only to
the extent permitted by Section 9-315 of the N.Y.
Uniform Commercial Code), enforceable as such against
all creditors of the Pledgor and any persons purporting
to purchase any of the Collateral from the Pledgor
other than as permitted by the Indenture. Upon filing
of the financing statements described in Section 3(g)
hereof, all filings and other actions necessary or
desirable to perfect and protect such security interest
will have been duly taken.
(e) There are no legal or governmental
proceedings pending or, to the best of the Pledgor's
knowledge, threatened to which the Pledgor or any of
its subsidiaries is a party or to which any of the
properties of the Pledgor or any of its subsidiaries is
subject that would materially adversely affect the
power or ability of the Pledgor to perform its
obligations under this Pledge Agreement or to
consummate the transactions contemplated hereby.
(f) The pledge of the Collateral pursuant to this
Pledge Agreement is not prohibited by law or
governmental regulation (including, without limitation,
Regulations G, T, U and X of the Board of Governors of
the Federal Reserve System) applicable to the Pledgor.
(g) No Event of Default exists.
(h) The chief place of business and chief
executive office of the Pledgor are located at the
address first specified above for the Pledgor.
SECTION 8. Further Assurances. The Pledgor will,
promptly upon the request by the Collateral Agent
(which request the Collateral Agent may submit at the
direction of the Holders of a majority in aggregate
principal amount of the Notes then outstanding),
execute and deliver or cause to be executed and
delivered, or use its reasonable best efforts to
procure, all assignments, instruments and other
documents, deliver any instruments to the Collateral
Agent and take any other actions that are necessary or
desirable to perfect, continue the perfection of, or
protect the first priority of the Trustee's security
interest in and to the Collateral, to protect the
Collateral against the rights, claims or interests of
third persons (other than any such rights, claims or
interests created by or arising through the Collateral
Agent) or to effect the purposes of this Pledge
Agreement. Without limiting the generality of the
foregoing, the Pledgor will, if any Collateral shall be
evidenced by a promissory note or other instrument,
deliver to the Collateral Agent in pledge hereunder
such note or instrument duly indorsed and accompanied
by duly executed instruments of transfer or assignment;
and execute and file such financing or continuation
statements, or amendments thereto, and such other
instruments or notices, as may be necessary, or as the
Collateral Agent may reasonably request, in order to
perfect and preserve the pledge, assignment and
security interest granted or purported to be granted
hereby. The Pledgor also hereby authorizes the
Collateral Agent to file any financing or continuation
statements, and amendments thereto, in the United
States with respect to the Collateral without the
signature of the Pledgor (to the extent permitted by
applicable law). A photocopy or other reproduction of
this Agreement or any financing statement covering the
Collateral or any part thereof shall be sufficient as a
financing statement where permitted by law. The Pledgor
will promptly pay all costs incurred in connection with
any of the foregoing within 45 days of receipt of an
invoice therefor. The Pledgor also agrees, whether or
not requested by the Collateral Agent, to use its
reasonable best efforts to perfect or continue the
perfection of, or to protect the first priority of, the
Trustee's security interest in and to the Collateral,
and to protect the Collateral against the rights,
claims or interests of third persons (other than any
such rights, claims or interests created by or arising
through the Collateral Agent).
SECTION 9. Covenants. The Pledgor covenants and
agrees with the Collateral Agent, Trustee and the
Holders that from and after the date of this Pledge
Agreement until the Termination Date:
(a) it will not (i) (and will not purport to)
sell or otherwise dispose of, or grant any option or
warrant with respect to, any of the Collateral nor (ii)
create or permit to exist any Lien upon or with respect
to any of the Collateral (except for the liens and
security interests granted under this Pledge Agreement
and any Lien created by or arising through the
Collateral Agent) and at all times will be the sole
beneficial owner of the Collateral;
(b) it will not (i) enter into any agreement or
understanding that restricts or inhibits or purports to
restrict or inhibit the Trustee's or the Collateral
Agent's rights or remedies hereunder, including,
without limitation, the Collateral Agent's right to
sell or otherwise dispose of the Collateral or (ii)
fail to pay or discharge any tax, assessment or levy of
any nature with respect to its beneficial interest in
the Collateral not later than three Business Days prior
to the date of any proposed sale under any judgment,
writ or warrant of attachment with respect to the
Collateral;
(c) it will keep its chief place of business and
chief executive office at the location therefor
specified in Section 7(h), or upon 30 days' prior
written notice to the Collateral Agent, at such other
locations in a jurisdiction where all actions required
by Section 8 have been taken with respect to the
Collateral;
(d) it will, and will cause the Trustee and the
Collateral Agent to, execute and deliver on or prior to
any Date of Delivery, a Supplement to this Pledge
Agreement substantially in the form of Exhibit B
hereto, and take such other actions as shall be
necessary to grant to the Collateral Agent, for the
benefit of the Trustee and the ratable benefit of the
Holders, a valid assignment of and security interest in
the Additional Pledged Securities and the related
security entitlements.
SECTION 10. Power of Attorney; Agent May Perform.
(a) Subject to the terms of this Pledge Agreement, the
Pledgor hereby appoints and constitutes the Collateral
Agent as the Pledgor's attorney-in-fact (with full
power of substitution) to exercise to the fullest
extent permitted by law all of the following powers
upon and at any time after the occurrence and during
the continuance of an Event of Default:
(a) collection of proceeds of any Collateral;
(b) conveyance of any item of Collateral to any
purchaser thereof;
(c) giving of any notices or recording of any
Liens hereof; and
(d) paying or discharging taxes or Liens levied
or placed upon the Collateral, the legality or validity
thereof and the amounts necessary to discharge the same
to be determined by the Collateral Agent in its sole
reasonable discretion, and such payments made by the
Collateral Agent to become part of the Obligations
secured hereby, due and payable immediately upon
demand. The Collateral Agent's authority under this
Section 10 shall include, without limitation, the
authority to endorse and negotiate any checks or
instruments representing proceeds of Collateral in the
name of the Pledgor, execute and give receipt for any
certificate of ownership or any document constituting
Collateral, transfer title to any item of Collateral,
sign the Pledgor's name on all financing statements (to
the extent permitted by applicable law) or any other
documents necessary or appropriate to preserve, protect
or perfect the security interest in the Collateral and
to file the same, prepare, file and sign the Pledgor's
name on any notice of Lien (to the extent permitted by
applicable law), and to take any other actions arising
from or necessarily incident to the powers granted to
the Trustee or the Collateral Agent in this Pledge
Agreement. This power of attorney is coupled with an
interest and is irrevocable by the Pledgor.
(b) If the Pledgor fails to perform any agreement
contained herein, the Collateral Agent may, but is not
obligated to, after providing to the Pledgor notice of
such failure and five Business Days to effect such
performance, itself perform, or cause performance of,
such agreement, and the expenses of the Collateral
Agent incurred in connection therewith shall be payable
by the Pledgor under Section 14.
SECTION 11. No Assumption of Duties; Reasonable
Care. The rights and powers granted to the Collateral
Agent hereunder are being granted in order to preserve
and protect the security interest of the Collateral
Agent for the benefit of the Trustee and the Holders in
and to the Collateral granted hereby and shall not be
interpreted to, and shall not impose any duties on, the
Collateral Agent in connection therewith other than
those expressly provided herein or imposed under
applicable law. Except as provided by applicable law or
by the Indenture, the Collateral Agent shall be deemed
to have exercised reasonable care in the custody and
preservation of the Collateral in its possession if the
Collateral is accorded treatment substantially equal to
that which the Collateral Agent accords similar
property held by the Collateral Agent for similar
accounts, it being understood that the Collateral Agent
in its capacity as such
(a) may consult with counsel of its selection and
the advice of such counsel or any Opinion of Counsel
shall be full and complete authorization and protection
in respect of any action taken, suffered or omitted by
it hereunder in good faith and in reliance thereon and
(b) shall not have any responsibility for
(i) ascertaining or taking action with
respect to calls, conversions,
exchanges, maturities or other matters
relative to any Collateral, whether or
not the Collateral Agent has or is
deemed to have knowledge of such
matters,
(ii) taking any necessary steps for the
existence, enforceability or perfection
of any security interest of the
Collateral Agent or to preserve rights
against any parties with respect to any
Collateral or
(iii) except as otherwise set forth in
Section 5, investing or reinvesting any
of the Collateral, provided, however,
that in the case of clause (a) and
clause (b) of this sentence, nothing
contained in this Pledge Agreement shall
relieve the Collateral Agent of any
responsibilities as a securities
intermediary under applicable law.
In no event shall the Collateral Agent be liable
for the existence, validity, enforceability or
perfection of any security interest of the Collateral
Agent, or for special indirect or consequential damages
or lost profits or loss of business, arising in
connection with this Agreement.
SECTION 12. Indemnity. The Pledgor shall fully
indemnify, hold harmless and defend the Collateral
Agent and its directors and officers from and against
any and all claims, losses, actions, obligations,
liabilities and expenses, including reasonable defense
costs, reasonable investigative fees and costs, and
reasonable legal fees, expenses, and damages arising
from the Collateral Agent's appointment and
performance as Collateral Agent under this Pledge
Agreement, except to the extent that such claim,
action, obligation, liability or expense is directly
caused by the bad faith, gross negligence or willful
misconduct of such indemnified person. The provisions
of this Section 12 shall survive termination of this
Pledge Agreement and the resignation and removal of the
Collateral Agent.
SECTION 13. Remedies upon Event of Default.
Subject to Section 6(b), if any Event of Default under
the Indenture shall have occurred and be continuing and
the Notes shall have been accelerated in accordance
with the provisions of the Indenture:
(a) The Trustee, the Collateral Agent and the
Holders shall have, in addition to all other rights
given by law or by this Pledge Agreement or the
Indenture, all of the rights and remedies with respect
to the Collateral of a secured party upon default under
the N.Y. Uniform Commercial Code (whether or not the
N.Y. Uniform Commercial Code applies to the affected
Collateral) at that time. In addition, with respect to
any Collateral that shall then be in or shall
thereafter come into the possession or custody of the
Collateral Agent, the Collateral Agent may and, at the
written direction of the Trustee or the Holders of a
majority in aggregate principal amount of the Notes
then outstanding, shall appoint a broker or other
expert to sell or cause the same to be sold at any
broker's board or at public or private sale, in one or
more sales or lots, at such price or prices such broker
or other expert may deem commercially reasonable, for
cash or on credit or for future delivery, without
assumption of any credit risk. The purchaser of any or
all Collateral so sold shall thereafter hold the same
absolutely, free from any claim, encumbrance or right
of any kind whatsoever created by or through the
Pledgor. Unless any of the Collateral threatens, in the
reasonable judgment of the Collateral Agent, to decline
speedily in value, the Collateral Agent will give the
Pledgor reasonable notice of the time and place of any
public sale thereof, or of the time after which any
private sale or other intended disposition is to be
made. Any sale of the Collateral conducted in
conformity with reasonable commercial practices of
banks, insurance companies, commercial finance
companies, or other financial institutions disposing of
property similar to the Collateral shall be deemed to
be commercially reasonable. Any requirements of
reasonable notice shall be met if notice of the time
and place of any public sale or the time after which
any private sale is to be made is given to the Pledgor
as provided in Section 17.1 hereof at least ten (10)
days before the time of the sale or disposition. The
Collateral Agent or any Holder may, in its own name or
in the name of a designee or nominee, buy any of the
Collateral at any public sale and, if permitted by
applicable law, at any private sale. The Collateral
Agent shall not be obligated to make any sale of
Collateral regardless of notice of sale having been
given. The Collateral Agent may adjourn any public or
private sale from time to time by announcement at the
time and place fixed therefor, and such sale may,
without further notice, be made at the time and place
to which it was so adjourned. All expenses (including
court costs and reasonable attorneys' fees, expenses
and disbursements) of, or incident to, the enforcement
of any of the provisions hereof shall be recoverable
from the proceeds of the sale or other disposition of
the Collateral.
(b) The Pledgor further agrees to use its
reasonable best efforts to do or cause to be done all
such other acts as may be necessary to make such sale
or sales of all or any portion of the Collateral
pursuant to this Section 13 valid and binding and in
compliance with any and all other applicable
requirements of law. The Pledgor further agrees that a
breach of any of the covenants contained in this
Section 13 will cause irreparable injury to the Trustee
and the Holders, that the Trustee and the Holders have
no adequate remedy at law in respect of such breach
and, as a consequence, that each and every covenant
contained in this Section 13 shall be specifically
enforceable against the Pledgor, and the Pledgor hereby
waives and agrees not to assert any defenses against an
action for specific performance of such covenants
except for a defense that no Event of Default has
occurred.
(c) All cash proceeds received by the Collateral
Agent in respect of any sale of, collection from, or
other realization upon all or any part of the
Collateral may, in the discretion of the Collateral
Agent, be held by the Collateral Agent as collateral
for, and/or then or at any time thereafter applied
(after payment of any amounts payable to the Collateral
Agent or the Trustee pursuant to Section 14) by the
Collateral Agent for the ratable benefit of the Holders
first against any accrued and unpaid interest on the
Notes and thereafter against the remaining Obligations.
Any surplus of such cash or cash proceeds held by the
Collateral Agent and remaining after payment in full of
all of the Obligations shall be paid over to the
Pledgor.
(d) The Collateral Agent may, but is not
obligated to, exercise any and all rights and remedies
of the Pledgor in respect of the Collateral.
(e) Subject to and in accordance with the terms
of this Pledge Agreement, all payments received by the
Pledgor in respect of the Collateral shall be received
in trust for the benefit of the Collateral Agent, shall
be segregated from other funds of the Pledgor and shall
be forthwith paid over to the Collateral Agent in the
same form as so received (with any necessary
indorsement).
(f) The Collateral Agent may, without notice to
the Pledgor except as required by law and at any time
or from time to time, charge, set-off and otherwise
apply all or any part of the Obligations against the
Collateral Account or any part thereof.
(g) The Pledgor shall cease to be entitled to
direct the investment of amounts held in the Collateral
Account under Section 5 hereof and the Collateral Agent
shall not accept any direction from the Pledgor to
invest amounts held in the Collateral Account.
SECTION 14. Fees and Expenses. Pledgor agrees to
pay to Collateral Agent the fees as may be agreed upon
from time to time in writing. The Pledgor will upon
demand pay to the Trustee and the Collateral Agent the
amount of any and all expenses, including, without
limitation, the reasonable fees, expenses and
disbursements of its counsel, experts and agents
retained by the Trustee and the Collateral Agent, that
the Trustee and the Collateral Agent may incur in
connection with
(a) the review, negotiation and administration of
this Pledge Agreement,
(b) the custody or preservation of, or the sale
of, collection from, or other realization upon, any of
the Collateral,
(c) the exercise or enforcement of any of the
rights of the Collateral Agent, the Trustee and the
Holders hereunder or
(d) the failure by the Pledgor to perform or
observe any of the provisions hereof.
SECTION 15. Security Interest Absolute. All
rights of the Collateral Agent, the Trustee and the
Holders and security interests hereunder, and all
obligations of the Pledgor hereunder, shall be absolute
and unconditional irrespective of:
(a) any lack of validity or enforceability of the
Indenture or any other agreement or instrument relating
thereto;
(b) any change in the time, manner or place of
payment of, or in any other term of, all or any of the
Obligations, or any other amendment or waiver of or any
consent to any departure from the Indenture;
(c) any exchange, surrender, release or
non-perfection of any Liens on any other collateral for
all or any of the Obligations;
(d) any change, restructuring or termination of
the corporate structure or the existence of the Pledgor
or any of its subsidiaries;
(e) to the extent permitted by applicable law,
any other circumstance which might otherwise constitute
a defense available to, or a discharge of, the Pledgor
in respect of the Obligations or of this Pledge
Agreement; or
(f) any manner of application of other
collateral, or proceeds thereof, to all or any item of
the Obligations, or any manner of sale or other
disposition of any item of Collateral for all or any of
the Obligations.
SECTION 16. Collateral Agent's Representations,
Warranties and Covenants. The Collateral Agent (in its
capacity as securities intermediary) represents and
warrants that it is as of the date hereof, and it
agrees that for so long as it maintains the Collateral
Accounts and acts as the securities intermediary
pursuant to this Pledge Agreement it shall be a
securities intermediary and a FRBNY Member. In
furtherance of the foregoing, the Collateral Agent (in
such capacity) hereby:
(a) represents and warrants that it is a
commercial bank that in the ordinary course of its
business maintains securities accounts for others and
is acting in that capacity hereunder and with respect
to the Collateral Account;
(b) represents and warrants that it maintains a
FRBNY Member Securities Account with the FRBNY;
(c) agrees that the Collateral Account shall be
an account to which financial assets may be credited,
and undertakes to treat the Collateral Agent (in its
capacity as such) as entitled to exercise rights that
comprise (and entitled to the benefits of) such
financial assets, and entitled to exercise the rights
of an entitlement holder in the manner contemplated by
the UCC;
(d) hereby represents that, subject to applicable
law, it has not granted, and covenants that so long as
it acts as a securities intermediary hereunder it shall
not grant, control (including without limitation,
securities control) over or with respect to any
Collateral credited to any Collateral Account from time
to time to any other Person other than the Collateral
Agent (in its capacity as such);
(e) covenants that it shall not, subject to
applicable law, knowingly take any action inconsistent
with, and represents and covenants that it is not and
so long as this Pledge Agreement remains in effect will
not knowingly become, party to any agreement the terms
of which are inconsistent with, the provisions of this
Pledge Agreement;
(f) agrees that any item of property credited to
the Collateral Account shall be treated as a financial
asset;
(g) agrees that any item of Collateral credited
to the Collateral Account shall not be subject to any
security interest, Lien or right of set-off in favor of
it as securities intermediary, except as may be
expressly permitted under the Indenture (and in such
capacity shall take such actions as shall be necessary
and appropriate to cause such Collateral to remain free
of any Lien or security interest of any underlying
securities intermediary through which it holds such
Collateral or any security entitlement thereto);
(h) agrees to maintain the Collateral Account and
maintain appropriate books and records in respect
thereof in accordance with its usual procedures and
subject to the terms of this Pledge Agreement;
(i) hereby represents, that its jurisdiction as
securities intermediary, for purposes of Section
8-110(e) of the N.Y. Uniform Commercial Code and
Section 357.11 of the Treasury Regulations or the
corresponding U.S. federal regulations as they pertain
to this Pledge Agreement, the Collateral Account and
the security entitlements relating thereto, shall be
the State of New York;
(j) agrees that, with respect to any Collateral
that constitutes a security entitlement, it shall
comply with the provisions of Section 3(c)(i) or (ii)
of this Pledge Agreement and, with respect to any
Collateral that constitutes a securities account, it
shall comply with the provisions of Section 3(c)(i) or
(ii) of this Pledge Agreement with respect to all
security entitlements carried in such securities
account; and
(k) agrees that if its jurisdiction as securities
intermediary shall change from that jurisdiction
specified in Section 16(i), it will promptly notify the
Collateral Agent and the Trustee of such change and of
such new jurisdiction.
SECTION 17. Miscellaneous Provisions.
17.1. Notices. Any notice, approval, direction,
consent or other communication shall be sufficiently
given if in writing and delivered in person or mailed
by first class mail, commercial courier service or
telecopier communication, addressed as follows:
if to the Pledgor:
FCX Investment Ltd.
c/o Freeport-McMoRan Copper & Gold Inc.
▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: Treasurer
Telecopier No.: (▇▇▇) ▇▇▇-▇▇▇▇
if to the Collateral Agent:
The Bank of New York
▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇ ▇▇ ▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Attention: Corporate Trust Administration
Telecopier No.: (▇▇▇) ▇▇▇-▇▇▇▇
if to the Trustee:
The Bank of New York
▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇ ▇▇ ▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Attention: Corporate Trust Administration
Telecopier No.: (▇▇▇) ▇▇▇-▇▇▇▇
or, as to any such party, at such other address as
shall be designated by such party in a written notice
to each other party complying as to delivery with the
terms of this Section. All such notices and other
communications shall be deemed
to have been duly given: at the time delivered by hand,
if personally delivered;
three Business Days after being deposited in the mail,
postage prepaid, if
mailed; when receipt is confirmed, if telecopied; and
on the next Business Day
if timely delivered to an air courier guaranteeing
overnight delivery.
17.2. No Adverse Interpretation of Other
Agreements. This Pledge Agreement may not be used to
interpret another pledge, security or debt agreement of
the Pledgor or any subsidiary thereof. No such pledge,
security or debt agreement (other than the Indenture)
may be used to interpret this Pledge Agreement.
17.3. Severability. The provisions of this Pledge
Agreement are severable, and if any clause or provision
shall be held invalid, illegal or unenforceable in
whole or in part in any jurisdiction, then such
invalidity or unenforceability shall affect in that
jurisdiction only such clause or provision, or part
thereof, and shall not in any manner affect such clause
or provision in any other jurisdiction or any other
clause or provision of this Pledge Agreement in any
jurisdiction.
17.4. Headings. The headings in this Pledge
Agreement have been inserted for convenience of
reference only, are not to be considered a part hereof
and shall in no way modify or restrict any of the terms
or provisions hereof.
17.5. Counterpart Originals. This Pledge Agreement
may be signed in two or more counterparts, each of
which shall be deemed an original, but all of which
shall together constitute one and the same agreement.
17.6. Benefits of Pledge Agreement. Nothing in
this Pledge Agreement, express or implied, shall give
to any Person, other than the parties hereto and their
successors hereunder, and the Holders, any benefit or
any legal or equitable right, remedy or claim under
this Pledge Agreement.
17.7. Amendments, Waivers and Consents. Any
amendment or waiver of any provision of this Pledge
Agreement and any consent to any departure by the
Pledgor, the Trustee or the Collateral Agent or from
any provision of this Pledge Agreement shall be
effective only if made or duly given in compliance with
all of the terms and provisions of the Indenture, and
none of the Trustee, the Collateral Agent, the Pledgor,
or any Holder shall be deemed, by any act, delay,
indulgence, omission or otherwise, to have waived any
right or remedy hereunder or to have acquiesced in any
default or Event of Default or in any breach of any of
the terms and conditions hereof. Failure of the
Trustee, the Pledgor, the Collateral Agent or any
Holder to exercise, or delay in exercising, any right,
power or privilege hereunder shall not preclude any
other or further exercise thereof or the exercise of
any other right, power or privilege. A waiver by the
Trustee, the Pledgor, the Collateral Agent or any
Holder of any right or remedy hereunder on any one
occasion shall not be construed as a bar to any right
or remedy that the Trustee, the Pledgor, the Collateral
Agent or such Holder would otherwise have on any future
occasion. The rights and remedies herein provided are
cumulative, may be exercised singly or concurrently and
are not exclusive of any rights or remedies provided by
law.
17.8. [RESERVED]
17.9. Continuing Security Interest; Termination.
(a) This Pledge Agreement shall create a
continuing security interest in and to the Collateral
and shall, unless otherwise provided in the Indenture
or in this Pledge Agreement, remain in full force and
effect until the Termination Date. This Pledge
Agreement shall be binding upon the parties hereto and
their respective transferees, successors and assigns,
and shall inure, together with the rights and remedies
of the Trustee and the Collateral Agent hereunder, to
the benefit of the Trustee, the Collateral Agent, the
Pledgor, the Holders and their respective successors,
transferees and assigns.
(b) Upon the Termination Date, the pledge,
assignment and security interest granted hereby shall
terminate and all rights to the Collateral shall revert
to the Pledgor. At such time, the Collateral Agent
shall, pursuant to an Issuer Order, promptly reassign
and redeliver to the Pledgor all of the Collateral
hereunder that has not been sold, disposed of, retained
or applied by the Collateral Agent in accordance with
the terms of this Pledge Agreement and the Indenture
and execute and deliver to the Pledgor such documents
as the Pledgor shall reasonably request to evidence
such termination. Such reassignment and redelivery
shall be without warranty by or recourse to the
Collateral Agent or the Trustee in its capacity as
such, except as to the absence of any Liens on the
Collateral created by or arising through the Collateral
Agent or the Trustee, and shall be at the reasonable
expense of the Pledgor.
17.10. Survival Provisions. All representations,
warranties and covenants contained herein shall survive
the execution and delivery of this Pledge Agreement,
and shall terminate only upon the termination of this
Pledge Agreement. The obligations of the Pledgor under
Sections 12 and 14 hereof and the obligations of the
Collateral Agent under Section 17.9(b) hereof shall
survive the termination of this Pledge Agreement.
17.11. Waivers. The Pledgor waives presentment and
demand for payment of any of the Obligations, protest
and notice of dishonor or default with respect to any
of the Obligations, and all other notices to which the
Pledgor might otherwise be entitled, except as
otherwise expressly provided herein or in the
Indenture.
17.12. Authority of the Collateral Agent.
(a) The Collateral Agent shall have and be
entitled to exercise all powers hereunder that are
specifically granted to the Collateral Agent by the
terms hereof, together with such powers as are
reasonably incident thereto. The Collateral Agent may
perform any of its duties hereunder or in connection
with the Collateral by or through agents or attorneys,
shall not be responsible for any misconduct or
negligence on the part of any agent or attorney
appointed with due care by it hereunder and shall be
entitled to retain counsel and to act in reliance upon
the advice of counsel concerning all such matters.
Except as otherwise expressly provided in this Pledge
Agreement or the Indenture, neither the Collateral
Agent nor any director, officer, employee, attorney or
agent of the Collateral Agent shall be liable to the
Pledgor for any action taken or omitted to be taken by
the Collateral Agent, in its capacity as Collateral
Agent, hereunder, except for its own bad faith, gross
negligence or willful misconduct, and the Collateral
Agent shall not be responsible for the validity,
effectiveness or sufficiency hereof or of any document
or security furnished pursuant hereto. The Collateral
Agent and its directors, officers, employees, attorneys
and agents shall be entitled to rely conclusively on
any communication, instrument or document believed by
it or them to be genuine and correct and to have been
signed or sent by the proper Person or Persons. The
Collateral Agent shall have no duty to cause any
financing statement or continuation statement to be
filed in respect of the Collateral.
(b) The Pledgor acknowledges that the rights and
responsibilities of the Collateral Agent under this
Pledge Agreement with respect to any action taken by
the Collateral Agent or the exercise or non-exercise by
the Collateral Agent of any option, right, request,
judgment or other right or remedy provided for herein
or resulting or arising out of this Pledge Agreement
shall, as between the Collateral Agent and the Holders,
be governed by the Indenture and by such other
agreements with respect thereto as may exist from time
to time among them, but, as between the Collateral
Agent and the Pledgor, the Collateral Agent shall be
conclusively presumed to be acting as agent for the
Trustee and the Holders with full and valid authority
so to act or refrain from acting, and the Pledgor shall
not be obligated or entitled to make any inquiry
respecting such authority.
17.13. Final Expression. This Pledge Agreement,
together with the Indenture and any other agreement
executed in connection herewith, is intended by the
parties as a final expression of this Pledge Agreement
and is intended as a complete and exclusive statement
of the terms and conditions thereof.
17.14. Rights of Holders. No Holder shall have any
independent rights hereunder other than those rights
granted to individual Holders pursuant to Sections
6.05, 6.06 and 6.07 of the Indenture; provided that
nothing in this subsection shall limit any rights
granted to the Trustee under the Notes or the
Indenture.
17.15. GOVERNING LAW; SUBMISSION TO JURISDICTION;
WAIVER OF JURY TRIAL; WAIVER OF DAMAGES. (a) THIS
PLEDGE AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED IN
ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK,
EXCEPT TO THE EXTENT THAT THE VALIDITY OR PERFECTION OF
THE SECURITY INTEREST HEREUNDER, OR REMEDIES HEREUNDER,
IN RESPECT OF ANY PARTICULAR COLLATERAL ARE GOVERNED BY
THE LAWS OF A JURISDICTION OTHER THAN THE STATE OF NEW
YORK, AND, EXCEPT TO THE EXTENT THAT THE VALIDITY OR
PERFECTION OF THE SECURITY INTEREST HEREUNDER, OR
REMEDIES HEREUNDER, IN RESPECT OF ANY PARTICULAR
COLLATERAL ARE GOVERNED BY THE LAWS OF A JURISDICTION
OTHER THAN THE STATE OF NEW YORK, ANY DISPUTE ARISING
OUT OF, CONNECTED WITH, RELATED TO, OR INCIDENTAL TO
THE RELATIONSHIP ESTABLISHED BETWEEN THE PLEDGOR, THE
TRUSTEE, THE COLLATERAL AGENT AND THE HOLDERS IN
CONNECTION WITH THIS PLEDGE AGREEMENT, AND WHETHER
ARISING IN CONTRACT, TORT, EQUITY OR OTHERWISE, SHALL
BE RESOLVED IN ACCORDANCE WITH THE LAWS OF THE STATE OF
NEW YORK. NOTWITHSTANDING THE FOREGOING, THE MATTERS
IDENTIFIED IN 31 C.F.R. SECTIONS 357.10 AND 357.11 (AS
IN EFFECT ON THE DATE OF THIS PLEDGE AGREEMENT) SHALL
BE GOVERNED SOLELY BY THE LAWS SPECIFIED THEREIN.
(b) THE PLEDGOR HEREBY WAIVES PERSONAL SERVICE OF
PROCESS IN ANY SUIT, ACTION OR PROCEEDING WITH RESPECT
TO THIS PLEDGE AGREEMENT AND FOR ACTIONS BROUGHT UNDER
THE U.S. FEDERAL OR STATE SECURITIES LAWS BROUGHT IN
ANY FEDERAL OR STATE COURT LOCATED IN THE CITY OF NEW
YORK (EACH A "NEW YORK COURT") AND CONSENTS THAT ALL
SERVICE OF PROCESS IN ANY SUCH SUIT, ACTION OR
PROCEEDING SHALL BE MADE BY REGISTERED MAIL, RETURN
RECEIPT REQUESTED, DIRECTED TO THE PLEDGOR AT THE
ADDRESS INDICATED IN SECTION 17.1. EACH OF THE PARTIES
HERETO SUBMITS TO THE JURISDICTION OF ANY NEW YORK
COURT AND TO THE COURTS OF ITS CORPORATE DOMICILE WITH
RESPECT TO ANY ACTIONS BROUGHT AGAINST IT AS DEFENDANT
IN ANY SUIT, ACTION OR PROCEEDING ARISING OUT OF,
CONNECTED WITH, RELATED TO, OR INCIDENTAL TO THE
RELATIONSHIP ESTABLISHED AMONG THE PLEDGOR, THE
TRUSTEE, THE COLLATERAL AGENT AND THE HOLDERS IN
CONNECTION WITH THIS PLEDGE AGREEMENT, AND EACH OF THE
PARTIES HERETO WAIVES ANY OBJECTION THAT IT MAY HAVE TO
THE LAYING OF VENUE, INCLUDING ANY PLEADING OF FORUM
NON CONVENIENS, WITH RESPECT TO ANY SUCH ACTION AND
WAIVES ANY RIGHT TO WHICH IT MAY BE ENTITLED ON ACCOUNT
OF PLACE OF RESIDENCE OR DOMICILE.
(c) THE PLEDGOR AGREES THAT THE TRUSTEE SHALL, IN
ITS CAPACITY AS TRUSTEE OR IN THE NAME AND ON BEHALF OF
ANY HOLDER, HAVE THE RIGHT, TO THE EXTENT PERMITTED BY
APPLICABLE LAW, TO PROCEED AGAINST THE PLEDGOR OR THE
COLLATERAL IN A COURT IN ANY LOCATION REASONABLY
SELECTED IN GOOD FAITH (AND HAVING PERSONAL OR IN REM
JURISDICTION OVER THE PLEDGOR OR THE COLLATERAL, AS THE
CASE MAY BE) TO ENABLE THE TRUSTEE TO REALIZE ON SUCH
COLLATERAL, OR TO ENFORCE A JUDGMENT OR OTHER COURT
ORDER ENTERED IN FAVOR OF THE TRUSTEE. THE PLEDGOR
AGREES THAT IT WILL NOT ASSERT ANY COUNTERCLAIMS,
SETOFFS OR CROSSCLAIMS IN ANY PROCEEDING BROUGHT BY THE
TRUSTEE TO REALIZE ON SUCH PROPERTY OR TO ENFORCE A
JUDGMENT OR OTHER COURT ORDER IN FAVOR OF THE TRUSTEE,
EXCEPT FOR SUCH COUNTERCLAIMS, SETOFFS OR CROSSCLAIMS
WHICH, IF NOT ASSERTED IN ANY SUCH PROCEEDING, COULD
NOT OTHERWISE BE BROUGHT OR ASSERTED.
(d) THE PLEDGOR AGREES THAT NEITHER ANY HOLDER
NOR (EXCEPT AS OTHERWISE PROVIDED IN THIS PLEDGE
AGREEMENT OR THE INDENTURE) THE COLLATERAL AGENT IN ITS
CAPACITY AS COLLATERAL AGENT SHALL HAVE ANY LIABILITY
TO THE PLEDGOR (WHETHER ARISING IN TORT, CONTRACT OR
OTHERWISE) FOR LOSSES SUFFERED BY THE PLEDGOR IN
CONNECTION WITH, ARISING OUT OF, OR IN ANY WAY RELATED
TO, THE TRANSACTIONS CONTEMPLATED AND THE RELATIONSHIP
ESTABLISHED BY THIS PLEDGE AGREEMENT, OR ANY ACT,
OMISSION OR EVENT OCCURRING IN CONNECTION THEREWITH,
UNLESS IT IS DETERMINED BY A FINAL AND NONAPPEALABLE
JUDGMENT OF A COURT THAT IS BINDING ON THE TRUSTEE OR
SUCH HOLDER, AS THE CASE MAY BE, THAT SUCH LOSSES WERE
THE RESULT OF ACTS OR OMISSIONS ON THE PART OF THE
COLLATERAL AGENT OR SUCH HOLDERS, AS THE CASE MAY BE,
CONSTITUTING BAD FAITH, GROSS NEGLIGENCE OR WILLFUL
MISCONDUCT.
(e) TO THE EXTENT PERMITTED BY APPLICABLE LAW,
THE PLEDGOR WAIVES THE POSTING OF ANY BOND OTHERWISE
REQUIRED OF THE TRUSTEE, THE COLLATERAL AGENT OR ANY
HOLDER IN CONNECTION WITH ANY JUDICIAL PROCESS OR
PROCEEDING TO ENFORCE ANY JUDGMENT OR OTHER COURT ORDER
PERTAINING TO THIS PLEDGE AGREEMENT OR ANY RELATED
AGREEMENT OR DOCUMENT ENTERED IN FAVOR OF THE TRUSTEE,
THE COLLATERAL AGENT OR ANY HOLDER, OR TO ENFORCE BY
SPECIFIC PERFORMANCE, TEMPORARY RESTRAINING ORDER OR
PRELIMINARY OR PERMANENT INJUNCTION, THIS PLEDGE
AGREEMENT OR ANY RELATED AGREEMENT OR DOCUMENT BETWEEN
THE PLEDGOR, ON THE ONE HAND, AND THE TRUSTEE, THE
COLLATERAL AGENT AND/OR THE HOLDERS, ON THE OTHER HAND.
17.16. Effectiveness. This Pledge Agreement
shall become effective upon the effectiveness of the
Indenture.
IN WITNESS WHEREOF, the Pledgor, the Trustee and
the Collateral Agent have each caused this Pledge
Agreement to be duly executed and delivered as of the
date first above written.
Pledgor:
FCX INVESTMENT LTD.
By:______________________________
Name:
Title:
Trustee:
THE BANK OF NEW YORK,
as Trustee
By:_____________________________
Name:
Title:
Collateral Agent:
THE BANK OF NEW YORK,
as Collateral Agent
By:_____________________________
Name:
Title:
SCHEDULE I
PART I
PLEDGED SECURITIES
Original
Final Principal
Description CUSIP Maturity Amount Cost at
of Debt No(s). Closing Time
Treasury ▇▇▇▇ ▇▇▇▇▇▇▇▇▇ 1/31/02 $24,075,00 $23,677,872.84
0.00
Treasury ▇▇▇▇▇▇▇▇▇ 5/15/02 $24,905,00 $24,259,960.50
Strip 0.00
Treasury ▇▇▇▇▇▇▇▇▇ 1/31/03 $24,904,00 $23,642,612.40
Strip 0.00
Treasury ▇▇▇▇▇▇▇▇▇ 6/30/03 $24,905,00 $23,193,030.30
Strip 0.00
Treasury ▇▇▇▇▇▇▇▇▇ 11/15/03 $24,905,00 $22,782,346.85
Strip 0.00
Treasury ▇▇▇▇▇▇▇▇▇ 5/15/04 $24,904,00 $22,206,149.68
Strip 0.00
PART II
Issuer of Descriptio Securities Securities
Financial n of Intermediary Account (Number
Asset Financial (Name and and Location)
Asset Address)
U.S. Treasury The Bank of New The Bank of New
Government ▇▇▇▇ ▇▇▇▇ York,
121 ▇▇▇▇▇▇▇ Account No.
Street 123791
Floor ▇▇ ▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇
▇▇▇▇ ▇▇▇▇▇
▇.▇. Treasury The Bank of New The Bank of New
Government Strip York York,
121 ▇▇▇▇▇▇▇ Account No.
Street 123791
Floor ▇▇ ▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇
▇▇▇▇ ▇▇▇▇▇
▇.▇. Treasury The Bank of New The Bank of New
Government Strip York York,
121 ▇▇▇▇▇▇▇ Account No.
Street 123791
Floor ▇▇ ▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇
▇▇▇▇ ▇▇▇▇▇
▇.▇. Treasury The Bank of New The Bank of New
Government Strip York York,
121 ▇▇▇▇▇▇▇ Account No.
Street 123791
Floor ▇▇ ▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇
▇▇▇▇ ▇▇▇▇▇
▇.▇. Treasury The Bank of New The Bank of New
Government Strip York York,
121 ▇▇▇▇▇▇▇ Account No.
Street 123791
Floor ▇▇ ▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇
▇▇▇▇ ▇▇▇▇▇
▇.▇. Treasury The Bank of New The Bank of New
Government Strip York York,
121 ▇▇▇▇▇▇▇ Account No.
Street 123791
Floor ▇▇ ▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇
▇▇▇▇ ▇▇▇▇▇
EXHIBIT A
THE BANK OF NEW YORK
OFFICER'S CERTIFICATE
Pursuant to Section 3(e) of the Collateral Pledge
and Security Agreement (as supplemented from time to
time, the "Pledge Agreement") dated as of August 7,
2001 among FCX Investment Ltd., a Cayman Islands
exempted company (the "Pledgor"), The Bank of New York,
as trustee (the "Trustee") for the holders of the $525
million aggregate principal amount (or up to $603.75
million aggregate principal amount if the Initial
Purchaser's overallotment option is exercised) of 8 1/4%
Convertible Senior Notes Due 2006 of the Pledgor and
Freeport-McMoRan Copper & Gold Inc., and The Bank of
New York, as collateral agent and securities
intermediary (the "Collateral Agent"), the undersigned
officer of the Collateral Agent, on behalf of the
Collateral Agent, makes the following certifications to
the Pledgor and the Initial Purchaser. Capitalized
terms used and not defined in this Officer's
Certificate have the meanings set forth or referred to
in the Pledge Agreement.
1. Substantially contemporaneously with the
execution and delivery of this Officer's Certificate,
the Collateral Agent has acquired its security
entitlement to the [Initial Pledged Securities] [the
Additional Pledged Securities identified on Supplement
No. __ to the Pledge Agreement] or through a
"securities account" (as defined in Section 8-501(a) of
the N.Y. Uniform Commercial Code) maintained by the
Collateral Agent, for value and without notice of any
adverse claim thereto. Without limiting the generality
of the foregoing, the Collateral Account, the Pledged
Securities and the other Collateral are not, and the
Collateral Agent's security entitlement to the
Collateral is not, to the actual knowledge of the
corporate trust officer having responsibility for the
administration of the Pledge Agreement on behalf of the
Collateral Agent, subject to any Lien granted by or to
or arising through or in favor of any securities
intermediary (including, without limitation, the Bank
of New York, or the FRBNY) through which the Collateral
Agent derives its security entitlement to the
Collateral.
2. The Collateral Agent has not knowingly caused
or permitted the Collateral Account or its security
entitlement thereto to become subject to any Lien
created by or arising through the Collateral Agent.
IN WITNESS WHEREOF, the undersigned officer has
executed this Officer's Certificate on behalf of The
Bank of New York, as Collateral Agent this ___ day of
_______, 2001.
THE BANK OF NEW YORK,
as Collateral Agent
By:_____________________
Name:
Title:
EXHIBIT B
[Form of Supplement to the Pledge Agreement]
SUPPLEMENT NO. __ dated as of _________, 2001, to
the COLLATERAL PLEDGE AND SECURITY AGREEMENT dated as
of August 7, 2001 (as supplemented from time to time,
the "Pledge Agreement") among FCX Investment Ltd., a
Cayman Islands exempted company (the "Pledgor"), The
Bank of New York, a New York banking corporation, as
trustee (in such capacity, the "Trustee") for the
holders (the "Holders") of the Notes issued by the
Pledgor under the Indenture referred to below, and The
Bank of New York, as collateral agent and securities
intermediary (in such capacity, the "Collateral
Agent"). Capitalized terms used herein and not
otherwise defined herein shall have the meanings
assigned to such terms in the Pledge Agreement.
WHEREAS, the Pledgor and Freeport-McMoRan Copper &
Gold Inc. (together with the Pledgor, the "Issuers")
and ▇▇▇▇▇▇▇ Lynch, Pierce, ▇▇▇▇▇▇ & ▇▇▇▇▇ Incorporated
(the "Initial Purchaser") are parties to a Purchase
Agreement dated August 1, 2001 (the "Purchase
Agreement"), pursuant to which the Issuers have granted
the Initial Purchaser an overallotment option to
purchase up to $78.75 million aggregate principal
amount of the Pledgor's 8 1/4% Convertible Senior Notes
due 2006 (the "Notes");
WHEREAS, the Issuers and the Trustee have entered
into that certain indenture dated as of August 7, 2001
(as amended, restated, supplemented or otherwise
modified from time to time, the "Indenture"), pursuant
to which the Issuers are issuing the Notes on the date
hereof;
WHEREAS, pursuant to the Indenture, the Pledgor is
required to purchase, or cause the purchase of, and
pledge to the Collateral Agent for the benefit of the
Trustee and the Holders, on the relevant Date of
Delivery (as defined in the Purchase Agreement),
Pledged Securities in an amount that will be sufficient
upon receipt of scheduled interest and principal
payments of such securities, in the written opinion of
▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ LLP or another nationally recognized
firm of independent public accountants selected by the
Pledgor and delivered to the Trustee, to provide for
payment in full of the first six scheduled interest
payments due on the Notes;
WHEREAS, the Pledgor, the Trustee and the
Collateral Agent have entered into the Pledge
Agreement, pursuant to which the Pledgor has previously
pledged certain Pledged Securities to the Collateral
Agent for the benefit of the Holders in connection with
the purchase by the Initial Purchaser of $525,000,000
million aggregate principal amount of Notes;
WHEREAS, the Initial Purchaser has exercised its
overallotment option under the Purchase Agreement to
purchase $__ million aggregate principal amount of
Notes;
WHEREAS, it is a condition precedent to the
purchase of the Notes by the Initial Purchaser pursuant
to the overallotment option granted in the Purchase
Agreement that the Pledgor apply certain of the
proceeds of the offering of the Notes to purchase the
Additional Pledged Securities and deposit such
Additional Pledged Securities into the Collateral
Account to be held therein subject to the terms of the
Pledge Agreement and shall have granted the assignment
and security interest and made the pledge and
assignment contemplated by the Pledge Agreement;
NOW, THEREFORE, in consideration of the premises
herein contained, and in order to induce the Initial
Purchaser to purchase the Notes, the Pledgor, the
Trustee and the Collateral Agent hereby agree, for the
benefit of the Initial Purchaser and for the ratable
benefit of the Holders, as follows:
Section 1. Pledge and Grant of Security Interest.
Pursuant to Section 1.3 of the Pledge Agreement, as
security for the prompt and complete payment and
performance when due (whether at the stated maturity,
by acceleration or otherwise) of the Obligations, the
Pledgor hereby assigns and pledges to the Collateral
Agent for the benefit of the Trustee and the ratable
benefit of the Holders and hereby grants to the
Collateral Agent for the benefit of the Trustee and for
the ratable benefit of the Holders, a lien on and
security interest in all of the Pledgor's right, title
and interest in, to and under the following property:
(a) the U.S. Government Obligations identified by CUSIP
No. in Part I of Schedule I hereto (the "Additional
Pledged Securities") and the certificates representing
the Additional Pledged Securities, the scheduled
payments of principal and interest thereon which will
be sufficient to provide for payment in full of the
first six scheduled interest payments due on the Notes
issued in connection herewith and (b) the security
entitlements described in Part II of Schedule I hereto,
with respect to the financial assets described, the
securities intermediary named, and the securities
account referred to therein. The Pledge Agreement is
hereby incorporated herein by reference.
Section 2. Supplement to Schedule I. The parties
hereto agree that Schedule I to the Pledge Agreement
shall be supplemented by Schedule I hereto.
Section 3. Deposit of Proceeds from the Offering.
Pursuant to Section 2(b)(ii) of the Pledge Agreement,
on the date hereof, the Pledgor agrees to transfer, or
caused to be transferred, an amount equal to
$___________, which amount shall be sufficient for the
Collateral Agent to purchase the Additional Pledged
Securities, by depositing such funds into the
Collateral Account. The Collateral Agent agrees to
apply such amount to purchase the Additional Pledged
Securities as contemplated under Section 2(c) of the
Pledge Agreement.
Section 4. Representations and Warranties of the
Pledgor. The Pledgor hereby represents and warrants to
the Trustee and the Collateral Agent that:
(a) Each of this Supplement and the Pledge
Agreement as supplemented hereby has been
duly authorized, validly executed and
delivered by the Pledgor and (assuming the
due authorization and valid execution and
delivery of this Supplement by each of the
Trustee and the Collateral Agent) constitutes
a valid and binding agreement of the Pledgor,
enforceable against the Pledgor in accordance
with its terms, except as (i) the
enforceability hereof and thereof may be
limited by bankruptcy, insolvency, fraudulent
conveyance, preference, reorganization,
moratorium or similar laws now or hereafter
in effect relating to or affecting the rights
or remedies of creditors generally, (ii) the
availability of equitable remedies may be
limited by equitable principles of general
applicability and the discretion of the court
before which any proceeding therefor may be
brought, (iii) the exculpation provisions and
rights to indemnification under the Pledge
Agreement may be limited by U.S. federal and
state securities laws and public policy
considerations and (iv) the waiver of rights
and defenses contained in Section 13(b),
Section 17.11 and Section 17.15 of the Pledge
Agreement may be limited by applicable law
and
(b the representations and warranties of the
Pledgor set forth in Section 7 of the Pledge
Agreement are true and correct in all
material respects with the same effect as if
made on and as of the date hereof.
Section 5. Execution in Counterparts. This
Supplement may be signed in two or more counterparts,
each of which shall be deemed an original, but all of
which shall together constitute one and the same
agreement. This Supplement shall become effective when
the Collateral Agent shall have received counterparts
of this Supplement that, when taken together, bear the
signatures of the Pledgor, the Trustee and the
Collateral Agent.
Section 6. Effect of Supplement. Except as
expressly supplemented hereby, the Pledge Agreement
shall remain in full force and effect.
Section 7. Governing Law. This Supplement shall
governed by and construed in accordance with the laws
of the State of New York.
IN WITNESS WHEREOF, the Pledgor, the Trustee and
the Collateral Agent have each caused this Supplement
to be duly executed and delivered as of the date first
above written.
Pledgor:
FCX INVESTMENT LTD.
By:______________________________
Name:
Title:
Trustee:
THE BANK OF NEW YORK,
as Trustee
By:_____________________________
Name:
Title:
Collateral Agent:
THE BANK OF NEW YORK,
as Collateral Agent
By:_____________________________
Name:
Title:
SCHEDULE I TO
SUPPLEMENT NO. __ TO
PLEDGE AGREEMENT
PART I
PLEDGED SECURITIES
Original
Final Principal Cost at
Description CUSIP Maturity Amount Date of
of Debt No(s). Delivery
PART II
Issuer of Description Securities Securities
Financial of Financial Intermediary Account (Number
Asset Asset (Name and and Location)
Address)