Exhibit 10.11
MMR
SERVICES AGREEMENT
THIS SERVICES AGREEMENT (this "Agreement"), dated as of November 17, 1998 by
and between FM Services Company, a Delaware corporation ("FMS"), and McMoRan
Exploration Co., a Delaware corporation ("MMR").
WHEREAS, MMR desires that FMS furnish MMR and its affiliates, as that term
is defined in Rule 405 under the Securities Act of 1933 (collectively, the
"MMR Group"), with Services, as defined below, to support and complement the
services provided by its officers, employees and other available resources.
NOW THEREFORE, in consideration of the covenants and agreements set forth
herein, and other good and valuable consideration, the receipt and sufficiency
of which are hereby acknowledged, the parties hereto agree as follows:
Section 1. Services. During the term of this Agreement FMS shall furnish the
following services (collectively, the "Services") to the MMR Group: (a)
accounting, treasury and financial, (b) tax, (c) insurance and risk management
(including the purchase and maintenance on behalf of MMR of such insurance as
MMR deems necessary or appropriate),(d) human resources (including employee
benefit services), (e) management information and system support, (f)
governmental relations, (g) community relations, (h) investor relations, (i)
facilities management and security, (j) business development, (k) executive
support, (l) aviation, (m) contract administration and (n) such other services
as may mutually be agreed upon by the parties hereto. Services shall be
provided directly by FMS or, in the discretion of FMS, by affiliated or
non-affiliated third parties.
Section 2. Administration of Services. FMS shall keep the appropriate
officers and employees of MMR and other members of the MMR Group fully
informed and shall cooperate with such officers and employees with respect to
the performance of Services by FMS. Each member of the MMR Group shall have
complete and full access to all data, records, files, statements, invoices,
xxxxxxxx and other information generated by or in the custody of FMS
relating to Services provided to such entity.
Section 3. Compensation.
(a) As compensation for the performance of the Services, MMR shall
reimburse, or cause another member of the MMR Group to reimburse, FMS for:
(i) All expenses of the Services incurred by FMS that are readily
identifiable to the MMR Group, including personnel related costs (which
shall be based upon department head allocations), facilities related costs
(based upon personnel cost allocations) and aviation costs ("Direct Charges");
(ii) All costs of goods, services or other items purchased from third
parties by FMS for the MMR Group, to the extent such costs are paid by FMS
("Third Party Charges"); and
(iii) The portion of all other expenses incurred by FMS in connection
with providing the Services to the MMR Group and similar services to Freeport
-McMoRan Copper & Gold Inc. ("FCX") and Stratus Properties Inc. ("STRS") and
their respective affiliates as directed from time to time by the joint written
instructions of MMR, FCX, and STRS pursuant to the Stockholder Agreement of
even date herewith among MMR, FCX, and STRS ("Allocated Charges").
(b) FMS shall invoice MMR by the last day of each month for all Direct
Charges, Third Party Charges and Allocated Charges incurred for the immediately
preceding month. All invoices shall provide MMR with an account of all such
charges and an accounting for all Advances, as defined below, during such
month. All amounts shown on each invoice shall be due and payable within five
(5) days of the date of the invoice. In the event of a dispute as to
the propriety of any invoiced amount, MMR shall pay, or cause the payment of,
all undisputed amounts on each invoice, but shall be entitled to withhold
payment of any amount in dispute and shall promptly notify FMS of the basis of
the dispute.
(c) MMR shall advance, or cause the advancement of, funds to FMS for Direct
Charges, Third Party Charges and Allocated Charges from time to time during the
term of this Agreement (which may be as often as daily) as requested by FMS,
such funds to serve as an advance of the amounts to be invoiced hereunder
(the "Advances").
Section 4. Use of FMS Facilities. FMS shall provide the MMR Group with a
non-exclusive right to utilize its properties and facilities, subject to such
limitations, if any, as may be imposed by leases and other agreements and
instruments governing the use of such properties and facilities.
Section 5. Terms of Agreement; Termination. (a) This Agreement shall commence
as of the date first above written and shall continue in effect until (i) the
parties mutually agree in writing to terminate this Agreement, (ii) 90 days
after receipt by FMS of written notice from MMR of its request to terminate
this Agreement, or (iii) a Change in Control. A "Change in Control" shall be
deemed to have occurred if any Person or group (within the meaning of Rule
13d-5 of the SEC as in effect on the date hereof) shall own directly or
indirectly, beneficially or of record, shares representing 50% or more of the
aggregate ordinary voting power represented by the issued and outstanding
capital stock of MMR.
(b) Upon termination of this Agreement, MMR shall be liable for (i) Direct
Charges, Third Party Charges and Allocated Charges incurred in accordance
with Section 3 prior to termination, (ii) its proportionate share of all
costs incurred by FMS or which FMS is obligated to incur in connection with
providing the Services after termination, because of the anticipated long
-term nature of this Agreement or otherwise, and (iii) all costs of such
termination, whether direct or indirect and including costs incurred by FMS
in connection with the termination by FMS of obligations entered into
in connection with the Services.
Section 6. Limitation of Liability.
(a) FMS makes no representation or warranty whatsoever, express or
implied, with respect to the Services. In no event shall FMS be liable to
MMR for (i) any loss, cost or expense resulting from any act or omission
taken at the express direction of any member of the MMR Group or (ii) any
special, indirect or consequential damages resulting from any error or
omission in the performance of the Services or from the breach of this
Agreement.
(b) Neither FMS nor MMR shall be liable for any loss or damage or any
nonperformance, partial or whole, under this Agreement, caused by any
strike, labor troubles, riot act of a public enemy, insurrection, act of
God, or any law, rule or regulation promulgated by any governmental body
or agency, or any demand or requisition of any governmental body or agency,
or any other cause beyond the control of the parties hereto.
Section 7. Confidentiality. FMS will hold and will use its best efforts
to cause its officers, directors, employees and other agents (collectively,
its "Agents") to hold, in confidence, all confidential documents and
information concerning the MMR Group furnished to such party in connection
with this Agreement, except to the extent that such information can be
shown to have been (a) previously known by such party on a nonconfidential
basis, (b) in the public domain through no fault of such party or (c) later
lawfully acquired by such party on a nonconfidential basis from a source
other than the MMR Group; provided that FMS may disclose such information
in connection with this Agreement to its Agents so long as such persons are
informed by FMS of the confidential nature of such information and are
directed by FMS to keep such information confidential and not to use it for
any purpose other than its intended use. Notwithstanding the foregoing,
FMS or its Agents may disclose such information if (i) compelled to disclose
by judicial or administrative process or by other requirements of law or
(ii) necessary to establish such party's position in any litigation or any
arbitration or other proceeding based upon or in connection with the subject
matter of this Agreement. Prior to any disclosure pursuant to the
preceding sentence, FMS or its Agent(s) shall give reasonable prior notice
to MMR of such intended disclosure, and if requested by MMR, FMS shall use
all reasonable efforts to obtain a protective order or similar protection
for such information and shall otherwise disclose only such information as
is legally required. If all or any part of the Services are terminated,
FMS will, and will use its best efforts to cause its Agents to, destroy or
deliver to MMR, upon request, all documents and other materials, and all
copies thereof, containing confidential information obtained from the MMR
Group in connection with the Services so terminated.
Section 8. Technology. FMS hereby grants to MMR a royalty free,
non-exclusive right and license to use (but not to sublicense outside of the
MMR Group) any and all technology, whether or not patented, developed by or
on behalf of FMS, relating to the business of MMR; provided that the license
hereby granted shall not extend to (i) any technology developed for a person
not affiliated with FMS, pursuant to an arrangement granting such person
exclusive rights to such technology, or (ii) any technology developed after
the termination of this Agreement.
Section 9. Dispute Resolution. MMR and FMS shall use all reasonable efforts
to amicably resolve all disputes arising under this Agreement. If despite
such efforts any matter cannot be amicably resolved the matter shall be
referred to the Presidents of MMR and FMS who shall promptly meet for the
purpose of resolving such dispute. If despite such efforts and meetings the
matter remains unresolved, then any affected party may refer the matter to
arbitration for final resolution in accordance with the commercial rules of
the American Arbitration Association. Any matter submitted to arbitration
shall be decided by a single arbitrator selected by mutual agreement of the
parties (or if the parties cannot agree then such arbitrator shall be selected
by the appropriate official or designee of the American Arbitration
Association). Any such arbitration proceeding shall be held in New Orleans,
Louisiana. Each party shall bear its own costs and expenses, and the
arbitrator's fees and expenses and the costs and expenses of the proceeding
itself shall be borne by the parties in such proportions as the arbitrator
shall decide. The decision of the arbitrator shall be final and
non-appealable, and may be enforced in any court of competent
jurisdiction.
Section 10. Miscellaneous.
(a) The parties hereto are independent contractors. Nothing in this
Agreement is intended or shall be deemed to constitute a partnership, agency,
franchise or joint venture relationship between the parties. Neither party
shall incur any debts or make any commitments upon the other, except to the
extent specifically provided herein.
(b) This Agreement constitutes the entire agreement between the parties
hereto with respect to the matters set forth in this Agreement. This Agreement
shall not be amended,modified or supplemented except by an instrument in
writing executed by each of the parties hereto.
(c) All notices and other communications hereunder shall be in writing and
shall be given by hand delivery, certified or registered mail, return receipt
requested or telecopy transmission with confirmation of receipt to the address
of each of the parties set forth opposite the signature of such party on the
signature page hereof. All notices and communications shall be deemed given
upon receipt thereof.
(d) This Agreement shall be governed by and construed in accordance with
the internal laws of the State of Louisiana without the application of any
conflicts of laws principles.
(e) This Agreement shall inure to the benefit of and be binding upon the
parties hereto and their respective successors and assigns. This Agreement
shall not be assignable by any party hereto without the prior written consent
of the other party.
IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of the
date first above written.
Address for Notices: FM SERVICES COMPANY
0000 Xxxxxxx Xxxxxx By: /s/Xxxxxxx X. Xxxxxx
Xxx Xxxxxxx, XX 00000 ---------------------
Attention: General Counsel Xxxxxxx X. Xxxxxx
President
Address for Notices: McMoRan Exploration Co.
0000 Xxxxxxx Xxxxxx By: /s/Xxxxxxx X. Xxxxxxxx
Xxx Xxxxxxx, XX 00000 -------------------------
Attention: General Counsel Xxxxxxx X. Xxxxxxxx
Co-Chairman of the Board, President
and Chief Executive Officer
