CONFORMED COPY
FTX GUARANTY AGREEMENT
FTX GUARANTY AGREEMENT dated as of July 17, 1995 by
Freeport-McMoRan Inc., a Delaware corporation (including its
successors, "FTX").
WHEREAS in connection with the spin-off of Freeport-
McMoRan Copper & Gold Inc., a Delaware corporation ("FCX")
from FTX, each of FTX and FCX has agreed that it will
provide a partial guaranty of the FMPO Loans, the FMPO Notes
and the Circle C Notes (as hereinafter defined).
NOW THEREFORE, in consideration of the premises and
other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, FTX agrees as
follows:
ARTICLE I
GUARANTY
SECTION 1.01 Definitions. The following terms, as
used herein, have the following meanings:
"Credit Documents" means (i) the FMPO Credit
Agreement dated as of June 30, 1995 (as the same may be
amended from time to time, the "FMPO Credit Agreement")
among FM Properties Operating Co., a Delaware general
partnership ("FMPO"), FTX, FCX, the banks listed on the
signature pages thereof, Chemical Bank, as administrative
agent thereunder and The Chase Manhattan Bank, as
documentary agent thereunder, (ii) the Second Amended and
Restated Note Agreement dated as of June 30, 1995 (as the
same may be amended from time to time, the "Pel-Tex Note
Agreement") among FMPO, FTX and FCX, as guarantors, Hibernia
National Bank, as agent and Hibernia National Bank and
Chemical Bank, as banks, and any notes issued thereunder
(the "FMPO Notes") and (iii) the Circle C Credit Agreement
dated as of February 6, 0000 xxxxxxx Xxxxxx X Xxxx Corp., a
Texas corporation ("Circle C") and Texas Commerce Bank
National Association as amended by six amendments dated June
11, 1992, November 16, 1992, May 5, 1993, September 1, 1993,
February 2, 1994 and July 17, 1995 respectively (as the same
may be further amended from time to time, the "Circle C
Credit Agreement") and any note issued thereunder (each a
"Circle C Note") in each case as amended from time to time.
"FCX Guaranty" means the guarantee of FCX as set
forth in the FCX Guaranty Agreement dated as of July 17,
1995 by FCX.
"FCX Guaranty Limit" means $90,000,000 subject to
reduction pursuant to Section 2.02 of the FCX Guaranty
Agreement.
"FMPO Loan" means each Loan made under the FMPO
Credit Agreement.
"FMPO Obligations" means the principal of and
interest on each (i) FMPO Loan, (ii) FMPO Note and (iii)
Circle C Note; provided that in no event shall the aggregate
principal amount of the FMPO Loans exceed $50,000,000, the
aggregate principal amount of the FMPO Notes exceed
$68,000,000 (or any amount thereof once repaid be
reborrowed) or the aggregate principal amount of the Circle
C Notes exceed $40,811,428.
"FTX Basic Guaranty Limit" means $45,000,000 subject
to reduction pursuant to Section 2.02.
"FTX Excess Guaranty Limit" means $23,811,428
subject to reduction pursuant to Section 2.02.
"Pro Rata Share" means, as to the FMPO Loans, the
FMPO Notes and the Circle C Notes, the outstanding principal
amount of the FMPO Loans, the FMPO Notes or the Circle C
Notes, as the case may be, as a percentage of the aggregate
outstanding principal amount of the FMPO Loans, the FMPO
Notes and the Circle C Notes.
SECTION 1.02. The Guaranty. Subject to the
provisions of Article II, FTX hereby unconditionally and
irrevocably guarantees as a primary obligor and not merely
as a surety, the due and punctual payment when and as due
(whether at stated maturity, by notice of prepayment, upon
acceleration or otherwise) of the FMPO Obligations, and
subject to Section 2.03, FTX shall forthwith on demand pay
the amount not so paid at the place and in the manner
specified in the respective Credit Document. This Guaranty
is a guaranty of payment when due and not of collection.
FTX hereby waives presentment to, demand of payment from,
notice of intent to accelerate to, notice of acceleration
to, notice of protest and dishonor to, and protest to FMPO
or Circle C of any of the FMPO Obligations, and also waives
notice of acceptance of this Guaranty and notice of protest
for nonpayment.
SECTION 1.03. Guaranty Unconditional. Subject to
the provisions of Article II, the obligations of FTX
hereunder shall be unconditional and absolute and, without
limiting the generality of the foregoing, shall not be
released, discharged or otherwise affected by:
(i) any rescission, extension, renewal, settlement,
compromise, waiver or release in respect of any
obligation of FMPO or Circle C under the Credit
Documents, by operation of law or otherwise;
(ii) any modification or amendment of or supplement
to the Credit Documents;
(iii) any guarantee or any release, impairment,
non-perfection or invalidity of any direct or indirect
security for any obligation of FMPO or Circle C under the
Credit Documents;
(iv) any change in the corporate existence,
structure or ownership of FMPO or Circle C, or any
insolvency, bankruptcy, reorganization or other similar
proceeding affecting FMPO or Circle C or their respective
assets or any resulting release or discharge of any
obligation of FMPO or Circle C contained in the Credit
Documents;
(v) the existence of any claim, set-off or other
rights which FTX may have at any time against FMPO or
Circle C, any Agent, any Bank or any other corporation or
person, whether in connection herewith or any unrelated
transactions, provided subject to any subordination
agreements relating to any such claims, that nothing
herein shall prevent the assertion of any such claim by
separate suit or compulsory counterclaim;
(vi) any invalidity or unenforceability relating to
or against FMPO or Circle C for any reason of the Credit
Documents, or any provision of applicable law or
regulation purporting to prohibit the payment by FMPO or
Circle C of the FMPO Obligations or any other amount
payable by FMPO or Circle C under the Credit Documents;
(vii) any other act or omission to act or delay of
any kind by FMPO or Circle C, any beneficiary of this
Guaranty or any other corporation or person or any other
circumstance whatsoever which might, but for the
provisions of this paragraph, constitute a legal or
equitable discharge of or defense to FTX's obligations
hereunder or to the FMPO Obligations;
(viii) any failure of any beneficiary of this
Guaranty to assert any claim or demand or to enforce any
right or remedy against FMPO or Circle C under the
provisions of the Credit Documents, the FCX Guaranty, any
other security document, any intercreditor document or
any other loan document; or
(ix) any failure of any beneficiary of this
Guaranty to exercise any right or remedy against any
other guarantor (including any subsidiary) of the FMPO
Obligations.
SECTION 1.04. Discharge Only Upon Payment In Full;
Reinstatement In Certain Circumstances. FTX's obligations
hereunder shall remain in full force and effect until the
earlier of the date on which (x) the commitments under the
Credit Documents shall have terminated and the FMPO
Obligations shall have been indefeasibly paid in full or (y)
indefeasible payments made hereunder with respect to
principal equal to the FTX Basic Guaranty Limit plus the FTX
Excess Guaranty Limit and all corresponding amounts of
interest have likewise been paid. If at any time any FMPO
Obligation is rescinded or must be otherwise restored or
returned upon the insolvency, bankruptcy or reorganization
of FMPO or Circle C or otherwise, FTX's obligations
hereunder with respect to such payment shall be reinstated
as though such payment had been due but not made at such
time.
SECTION 1.05. Waiver by the Guarantor. FTX
irrevocably waives acceptance hereof, presentment, demand,
protest, notice of intent to accelerate, notice of
acceleration and any notice not provided for herein, as well
as any requirement that at any time any action be taken by
any beneficiary of this Guaranty, corporation or person
against FMPO, Circle C or any other entity or person.
SECTION 1.06. Subrogation. Upon making any payment
with respect to FMPO or Circle C hereunder, FTX shall be
subrogated to the rights of the payee against FMPO or Circle
C with respect to such payment; provided that FTX shall not
enforce any payment by way of subrogation until all FMPO
Obligations and all other amounts payable by FMPO or Circle
C under the Credit Documents have been paid in full and all
commitments to lend thereunder have been terminated.
SECTION 1.07. Stay of Acceleration. If
acceleration of the time for payment of any FMPO Obligation
or any other amount payable by FMPO or Circle C under the
Credit Documents is stayed upon the insolvency, bankruptcy
or reorganization of FMPO or Circle C, all such amounts
otherwise subject to acceleration under the terms of the
Credit Documents shall nonetheless be payable by FTX
hereunder as if no such stay was in effect.
ARTICLE II
GUARANTY LIMIT
SECTION 2.01. Guaranty Limit. FTX shall be liable
under this Guaranty Agreement with respect to principal of
the FMPO Obligations for an amount equal to the FTX Basic
Guaranty Limit plus the FTX Excess Guaranty Limit and at any
time the amount to which the holders of the FMPO Loans, FMPO
Notes and Circle C Notes are entitled hereunder shall be
limited to their respective Pro Rata Shares of the FTX Basic
Guaranty Limit plus the FTX Excess Guaranty Limit, together
with interest accrued and unpaid thereon.
SECTION 2.02. Reduction of Guaranty Limit. Upon
indefeasible payment of any principal amount of the FMPO
Notes or, in the case of FMPO Loans or the Circle C Notes,
the permanent reduction of the commitments with respect
thereto (with corresponding repayment such that principal
amount does not exceed such reduced commitments) thereof,
(i) the FTX Excess Guaranty Limit shall be automatically
reduced by an amount equal to such payment on the FMPO Notes
or reduction in such commitments, (ii) if the FTX Excess
Guaranty Limit has been reduced to zero, the FCX Guaranty
Limit shall be automatically reduced by an amount equal to
such payment or reduction in commitments in excess of the
amount necessary to reduce the FTX Excess Guaranty Limit to
zero and (iii) if both the FTX Excess Guaranty Limit and the
FCX Guaranty Limit have been reduced to zero, the FTX Basic
Guaranty Limit shall be automatically reduced by an amount
equal to such payment or reduction in commitments in excess
of the amount necessary to reduce the FTX Excess Guaranty
Limit and the FCX Guaranty Limit to zero.
SECTION 2.03. Demand Made Last With Respect To FTX
Excess Guaranty Limit. Notwithstanding anything herein to
the contrary, so long as no Guarantor Default has occurred
and is continuing, no demand shall be made hereunder with
respect to the FTX Excess Guaranty Limit until (i) no amount
is available hereunder with respect to the FTX Basic
Guaranty Limit and (ii) no amount is available hereunder
with respect to the FCX Guaranty Limit. For purposes
hereof, a Guarantor Default means a default under subsection
7.1(a), (b), (g) or (h) of the Credit Agreement dated as of
June 30, 1995 among Freeport-McMoRan Resource Partners,
Limited Partnership, FTX, the banks party thereto, Chemical
Bank, as administrative agent and collateral agent and The
Chase Manhattan Bank, as documentary agent or subsection
7.1(a), (b), (g) or (h) of the Credit Agreement dated as of
June 30, 1995 among P.T. Indonesia Company, FCX, the banks
party thereto, First Trust, National Association, as FI
Trustee, Chemical Bank as Administrative Agent and as FCX
Collateral Agent, and the Chase Manhattan Bank (National
Association), as Documentary Agent.
ARTICLE III
REPRESENTATIONS AND WARRANTIES
SECTION 3.01 Corporate and Governmental
Authorization; No Contravention. FTX hereby represents and
warrants to the holders of the FMPO Obligations that the
execution, delivery and performance by FTX of this Guaranty
Agreement are within FTX's corporate powers, have been duly
authorized by all necessary corporate action, require no
action by or in respect of, or filing with, any governmental
body, agency or official and do not contravene, or
constitute a default under, any provision of applicable law
or regulation or of the certificate of incorporation or by-
laws of FTX or of any agreement, judgment, injunction,
order, decree or other instrument binding upon FTX and will
not cause or result in imposition of any lien on any asset
of FTX.
SECTION 3.02 Binding Effect. This Guaranty
Agreement constitutes a valid and binding agreement of FTX
enforceable in accordance with its terms. This Guaranty
Agreement shall inure to the benefit of present and future
holders of the FMPO Obligations.
ARTICLE IV
MISCELLANEOUS
SECTION 4.01 Governing Law; Submission to
Jurisdiction. This Guaranty Agreement shall be governed by
and construed in accordance with the laws of the State of
New York. FTX hereby submits to the nonexclusive
jurisdiction of the United States District Court for the
Southern District of New York and of any New York State
court sitting in New York City for purposes of all legal
proceedings arising out of or relating to this Guaranty
Agreement. FTX irrevocably waives, to the fullest extent
permitted by law, any objection which it may now or
hereafter have to the laying of the venue of any such
proceeding brought in such a court and any claim that any
such proceeding brought in such a court has been brought in
an inconvenient forum.
SECTION 4.02 Waiver of Jury Trial. FTX hereby
irrevocably waives any and all right to trial by jury in any
legal proceeding arising out of or relating to this Guaranty
Agreement.
SECTION 4.03 No Waiver by Delay. No delay or
omission to exercise any right or power accruing under any
default, omission or failure of performance hereunder shall
impair any such right or power or shall be construed to be a
waiver thereof, but any such right or power may be exercised
from time to time and as often as may be deemed expedient.
SECTION 4.04 Notices. All notices, requests and
other communications shall be in writing (including
facsimile transmission or similar writing) and shall be
mailed or sent by the sending party to: (i) in the case of
FTX, at its address set forth on the signature page hereof
or as otherwise notified to the beneficiaries of this
Guaranty or (ii) in the case of any other party, at its
address provided for in the Credit Documents.
IN WITNESS WHEREOF, FTX has caused this Guaranty
Agreement to be duly executed by X. Xxxxxx Xxxxxx,
Treasurer, as of the day and year first above written.
FREEPORT-McMoRan INC.
By: /s/ X. Xxxxxx Xxxxxx
Name: X. Xxxxxx Xxxxxx
Title:Treasurer
0000 Xxxxxxx Xxxxxx
Xxx Xxxxxxx, XX 00000
Attention: X. Xxxxxx Xxxxxx
Treasurer
