Item 3. Legal Proceedings. -------------------------- Although FCX may be from time to time involved in various legal proceedings of a character normally incident to the ordinary course of its business, the management of FCX believes that potential liability in any such pending or threatened proceedings would not have a material adverse effect on the financial condition or results of operations of FCX. FCX, through FTX, maintains liability insurance to cover some, but not all, potential liabilities normally incident to the ordinary course of its business as well as other insurance coverages customary in its business, with such coverage limits as management deems prudent.
Item 4.
Item 4. Submission of Matters to a Vote of Security Holders. ------------------------------------------------------------ Not applicable.
Executive Officers of the Registrant. ------------------------------------ In addition to the elected executive officers of FCX (the "Elected FCX Executive Officers"), one officer of PT-FI is deemed by FCX to be an executive officer of FCX (the "Designated FCX Executive Officer") for purposes of the federal securities laws. Listed below are the names and ages, as of March 15, 1995, of each of the Elected FCX Executive Officers and the Designated FCX Executive Officer, together with the principal positions and offices with FCX, FTX, and PT-FI held by each. All officers of FCX, FTX, and PT-FI are elected or appointed for one year terms, subject to death, resignation or removal.
Name Age Position or Office ---- --- -------------------
Richard C. Adkerson 48 Senior Vice President of FCX. Senior Vice President of FTX. Commissioner of PT-FI.
John G. Amato 51 General Counsel of FCX. General Counsel of FTX. Commissioner of PT-FI.
Richard H. Block 44 Senior Vice President of FCX. Senior Vice President of FTX.
Thomas J. Egan 50 Senior Vice President of FCX. Senior Vice President of FTX.
Charles W. Goodyear 37 Senior Vice President of FCX. Senior Vice President of FTX. Commissioner of PT-FI.
Hoediatmo Hoed*** 55 President Director of PT-FI.
W. Russell King 45 Senior Vice President of FCX. Senior Vice President of FTX.
Rene L. Latiolais 52 Director and Vice Chairman of the Board of FCX. Director, President, and Chief Operating Officer of FTX. Commissioner of PT-FI.
George A. Mealey 61 Director, President, and Chief Executive Officer of FCX. Executive Vice President of FTX. Director and Executive Vice President of PT-FI.
James R. Moffett 56 Director and Chairman of the Board of FCX. Director, Chairman of the Board, and Chief Executive Officer of FTX. President Commissioner of PT-FI.
The individuals listed above have served FCX, FTX, or PT-FI in various executive capacities for at least the last five years.
PART II
Item 5.
Item 5. Market for Registrant's Common Equity and Related ----------------------------------------------------------------- Stockholder Matters. ------------------- The information set forth under the caption "FCX Class A Common Shares" and "Class A Common Share Dividends", on the inside back cover of FCX's 1994 Annual Report to stockholders, is incorporated herein by reference. As of March 10, 1995, there were 19,844 record holders of FCX's Class A common stock.
----------------- ***This individual is a Designated FCX Executive Officer and not an Elected FCX Executive Officer. He is deemed by FCX to be a Designated FCX Executive Officer solely for purposes of the federal securities laws in view of his position and responsibilities as an officer of PT-FI; he holds no actual position as an officer of FCX.
Item 6.
Item 6. Selected Financial Data. -------------------------------- The information set forth under the caption "Selected Financial and Operating Data", on page 16 of FCX's 1994 Annual Report to stockholders, is incorporated herein by reference.
FCX's ratio of earnings to fixed charges for each of the years 1990 through 1994, inclusive, was 9.2x, 4.5x, 6.5x, 3.6x and 7.5x respectively. For this calculation, earnings consist of income from continuing operations before income taxes, minority interest and fixed charges. Fixed charges include interest and that portion of rent deemed representative of interest.
Item 7.
Item 7. Management's Discussion and Analysis of Financial Condition and ------------------------------------------------------------------------------- Results of Operations. --------------------- The information set forth under the caption "Management's Discussion and Analysis of Financial Condition and Results of Operations", on pages 11 through 14 and 17 through 20, of FCX's 1994 Annual Report to stockholders, is incorporated herein by reference.
Item 8.
Item 8. Financial Statements and Supplementary Data. ---------------------------------------------------- The financial statements of FCX, the notes thereto and the report thereon of Arthur Andersen LLP, appearing on pages 21 through 34, inclusive, and the report of management on page 15 of FCX's 1994 Annual Report to stockholders, are incorporated herein by reference.
Item 9.
Item 9. Changes in and Disagreements with Accountants on Accounting ---------------------------------------------------------------------------- and Financial Disclosure. ------------------------ Not applicable.
PART III
Items 10, 11, 12, and 13. Directors and Executive Officers of the --------------------------------------------------------------------- Registrant, Executive Compensation, Security Ownership of ------------------------------------------------------------ Certain Beneficial Owners and Management, and Certain --------------------------------------------------------- Relationships and Related Transactions. --------------------------------------
The information set forth under the captions "Voting Procedure" and "Election of Directors", beginning on pages 1 and 4, respectively, of the Proxy Statement dated March 23, 1995, submitted to the stockholders of FCX in connection with its 1995 Annual Meeting to be held on May 4, 1995, is incorporated herein by reference.
PART IV
Item 14.
Item 14. Exhibits, Financial Statement Schedules and Reports on Form 8-K. --------------------------------------------------------------------------
(a)(1), (a)(2), and (d). Financial Statements. See Index to Financial Statements appearing on page hereof.
(a)(3) and (c). Exhibits. See Exhibit Index beginning on page E-1 hereof.
(b). Reports on Form 8-K. No reports on Form 8-K were filed by the registrant during the fourth quarter of 1994.
SIGNATURES ----------
Pursuant to the requirements of Section 13 of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized, on March 23, 1995.
FREEPORT-McMoRan COPPER & GOLD INC.
BY: /s/ James R. Moffett -------------------------------- James R. Moffett Chairman of the Board
Pursuant to the requirements of the Securities Exchange Act of 1934, this report has been signed below by the following persons on behalf of the registrant and in the capacities indicated on March 23, 1995.
/s/ James R. Moffett Chairman of the Board ---------------------- Director James R. Moffett
George A. Mealey* President, Chief Executive Officer and Director (Principal Executive Officer)
Richard C. Adkerson* Senior Vice President and Chief Financial Officer (Principal Financial Officer)
John T. Eads* Controller - Financial Reporting (Principal Accounting Officer)
Leland O. Erdahl* Director
Ronald Grossman* Director
Rene L. Latiolais* Director
Wolfgang F. Siegel* Director
Elwin E. Smith* Director
Eiji Umene* Director
*By: /s/ James R. Moffett -------------------------- James R. Moffett Attorney-in-Fact
------------------------------
The financial statements of FCX, the notes thereto, and the report thereon of Arthur Andersen LLP appearing on pages 21 through 34, inclusive, of FCX's 1994 Annual Report to stockholders are incorporated by reference.
The financial statement schedules listed below should be read in conjunction with such financial statements contained in FCX's 1994 Annual Report to stockholders.
Page ---- Report of Independent Public Accountants........................F-1 III-Condensed Financial Information of Registrant...............F-2
Schedules other than those schedules listed above have been omitted since they are either not required or not applicable or the required information is included in the financial statements or notes thereof.
* * *
REPORT OF INDEPENDENT PUBLIC ACCOUNTANTS ----------------------------------------
We have audited, in accordance with generally accepted auditing standards, the financial statements as of December 31, 1994 and 1993 and for each of the three years in the period ended December 31, 1994 included in Freeport-McMoRan Copper & Gold Inc.'s annual report to shareholders incorporated by reference in this Form 10-K, and have issued our report thereon dated January 24, 1995. Our audits were made for the purpose of forming an opinion on those statements taken as a whole. The schedule listed in the index above is the responsibility of the Company's management and is presented for purposes of complying with the Securities and Exchange Commission's rules and is not part of the basic financial statements. This schedule has been subjected to the auditing procedures applied in the audits of the basic financial statements and, in our opinion, fairly states in all material respects the financial data required to be set forth therein in relation to the basic financial statements taken as a whole.
Arthur Andersen LLP
New Orleans, Louisiana, January 24, 1995
FREEPORT-McMoRan COPPER & GOLD INC. SCHEDULE III - CONDENSED FINANCIAL INFORMATION OF REGISTRANT
Balance Sheets
December 31, ------------------------ 1994 1993 ---------- ---------- (In Thousands)
Assets Cash and short-term investments $ 171 $ 427 Interest receivable 12,676 7,582 Receivable from Government of Indonesia - 2,247 Notes receivable from PT-FI 1,338,611 1,064,888 Investment in PT-FI 195,258 145,959 Investment in PTII 76,081 75,601 Investment in RTM 81,386 43,254 Other assets 14,988 2,011 ---------- ---------- Total assets $1,719,171 $1,341,969 ========== ========== Liabilities and Stockholders' Equity Accounts payable and accrued liabilities $ 27,270 $ 32,468 Long-term debt 190,000 102,039 Amount due to FTX 800 12,270 RTM stock subscription payable - 12,644 Other liabilities and deferred credits 6,119 2,001 Mandatory redeemable preferred stock 500,007 232,620 Stockholders' equity 994,975 947,927 ---------- ---------- Total liabilities and stockholders' equity $1,719,171 $1,341,969 ========== ==========
Statements of Income Years Ended December 31, -------------------------------- 1994 1993 1992 -------- -------- -------- (In Thousands) Income from investment in PT-FI and PTII, net of PT-FI tax provision $111,822 $ 53,861 $128,220 Net loss from investment in RTM (6,309) (15,666) - Elimination of intercompany profit 3,005 (6,610) - General and administrative expenses (7,253) (5,207) (4,802) Depreciation and amortization (3,711) (2,397) (200) Interest expense (10,259) (8,017) (16,518) Interest income on PT-FI notes receivable: Zero coupon exchangeable notes 352 19,175 18,326 Promissory notes 21,094 9,292 11,097 8.235% convertible 14,033 14,036 - Step-up perpetual convertible 26,256 12,785 - Gold and silver production payment loans 20,222 4,055 - Other income (expense), net (7,424) (406) 5,561 Provision for income taxes (31,587) (24,085) (11,791) -------- -------- -------- Net income 130,241 50,816 129,893 Preferred dividends (51,838) (28,954) (7,025) -------- -------- -------- $ 78,403 $ 21,862 $122,868 ======== ======== ========
FREEPORT-McMoRan COPPER & GOLD INC. SCHEDULE III - CONDENSED FINANCIAL INFORMATION OF REGISTRANT (Continued) Statements of Cash Flow Years Ended December 31, ----------------------------- 1994 1993 1992 -------- -------- -------- (In Thousands) Cash flow from operating activities: Net income $130,241 $ 50,816 $129,893 Adjustments to reconcile net income to net cash provided by operating activities: Income from investment in PT-FI and PTII (111,822) (53,861) (128,220) Net loss from investment in RTM 6,309 15,666 - Elimination of intercompany profit (3,005) 6,610 - Dividends received from PT-FI and PTII 147,465 132,048 78,214 Accretion of note receivable from PT-FI, net - (9,104) (1,808) Depreciation and amortization 3,711 2,397 200 (Increase) decrease in accounts receivable (24,240) - 20,000 Increase (decrease) in accounts payable (4,648) (646) 597 Other 1,654 (5,959) (1,854) -------- -------- -------- Net cash provided by operating activities 145,665 137,967 97,022 -------- -------- -------- Cash flow from investing activities: Received from Government of Indonesia 2,247 6,288 3,911 Investment in RTM (36,365) (43,642) - Investment in PTII (8) - (211,892) Investment in Freeport Hasa Inc. - - (1) -------- -------- -------- Net cash used in investing activities (34,126) (37,354) (207,982) -------- -------- -------- Cash flow from financing activities: Cash dividends paid: Class A common stock (38,316) (33,298) (26,088) Class B common stock (85,187) (85,277) (85,277) Special preference stock (15,708) (15,708) (4,407) Step-Up preferred stock (17,500) (5,590) - Mandatory redeemable preferred stock (13,614) (1,683) - Proceeds from sale of: Class A common stock - - 174,142 Preferred and preference stock 252,985 561,090 217,867 PT-FI common shares - - 212,484 9 3/4% senior notes 116,276 - - Proceeds from equipment loan 70,000 - - Proceeds from FTX 88,280 20,650 - Repayment to FTX (99,750) (8,380) - Loans to PT-FI (369,261) (706,750) (212,484) -------- -------- -------- Net cash provided by (used) in financing activities (111,795) (274,946) 276,237 -------- -------- -------- Net increase (decrease) in cash and short- term investments (256) (174,333) 165,277 Cash and short-term investments at beginning of year 427 174,760 9,483 -------- -------- -------- Cash and short-term investments at end of year $ 171 $ 427 $174,760 ======== ======== ======== Interest paid $ 7,788 $ 213 $ - ======== ======== ======== Taxes paid $ 29,871 $ 22,723 $ 11,762 ======== ======== ========
FREEPORT-McMoRan COPPER & GOLD INC. SCHEDULE III - CONDENSED FINANCIAL INFORMATION OF REGISTRANT (Continued)
a. The footnotes contained in FCX's 1994 Annual Report to stockholders are an integral part of these statements.
Freeport-McMoRan Copper & Gold Inc.
EXHIBIT INDEX --------------- Sequentially Exhibit Numbered Number Page -------- ----
3.1 Composite copy of the Certificate of Incorporation of FCX.
3.2 By-Laws of FCX, as amended. Incorporated by reference to Exhibit 3.2 to the Annual Report on Form 10-K of FCX for the fiscal year ended December 31, 1992 (the "FCX 1992 Form 10-K").
4.1 Certificate of Designations of the 7% Convertible Exchangeable Special Preference Stock (the "Special Preference Stock") of FCX. Incorporated by reference to Exhibit 5 to the Form 8 Amendment No. 1 dated July 16, 1992 (the "Form 8 Amendment") to the Application for Registration on Form 8-A of FCX dated July 2, 1992.
4.2 Deposit Agreement dated as of July 21, 1992 among FCX, Mellon Securities Trust Company, as Depositary, and holders of depositary receipts ("Depositary Receipts") evidencing certain Depositary Shares, each of which, in turn, represents 2-16/17 shares of Special Preference Stock. Incorporated by reference to Exhibit 2 to the Form 8 Amendment.
4.3 Form of Depositary Receipt. Incorporated by reference to Exhibit 1 to the Form 8 Amendment.
4.4 Certificate of Designations of the Step-Up Convertible Preferred Stock of FCX. Incorporated by reference to Exhibit 4.4 to the Annual Report on Form 10-K of FCX for the fiscal year ended December 31, 1993 (the "FCX 1993 Form 10-K").
4.5 Deposit Agreement dated as of July 1, 1993 among FCX, Mellon Securities Trust Company, as Depositary, and holders of depositary receipts ("Step- Up Depositary Receipts") evidencing certain Depositary Shares, each of which, in turn, represents 0.05 shares of Step-Up Convertible Preferred Stock. Incorporated by reference to Exhibit 4.5 to the FCX 1993 Form 10-K.
4.6 Form of Step-Up Depositary Receipt. Incorporated by reference to Exhibit 4.6 to the FCX 1993 Form 10-K.
4.7 Certificate of Designations of the Gold-Denominated Preferred Stock of FCX. Incorporated by reference to Exhibit 4.7 to the FCX 1993 Form 10-K.
4.8 Deposit Agreement dated as of August 12, 1993 among FCX, Mellon Securities Trust Company, as Depositary, and holders of depositary receipts ("Gold- Denominated Depositary Receipts") evidencing certain Depositary shares, each of which, in turn, represents 0.05 shares of Gold-Denominated Preferred Stock. Incorporated by reference to Exhibit 4.8 to the FCX 1993 Form 10-K.
4.9 Form of Gold-Denominated Depositary Receipt. Incorporated by reference to Exhibit 4.9 to the FCX 1993 Form 10-K.
4.10 Certificate of Designations of the Gold-Denominated Preferred Stock, Series II (the "Gold-Denominated Preferred Stock II") of FCX. Incorporated by reference to Exhibit 4.1 to the Quarterly Report on Form 10-Q of FCX for the quarter ended March 31, 1994 (the "FCX 1994 First Quarter Form 10-Q").
4.11 Deposit Agreement dated as of January 15, 1994, among FCX, Mellon Securities Trust Company, as Depositary, and holders of depositary receipts ("Gold- Denominated II Depositary Receipts") evidencing certain Depositary shares, each of which, in turn, represents 0.05 shares of Gold-Denominated Preferred Stock II. Incorporated by reference to Exhibit 4.2 to the FCX 1994 First Quarter Form 10-Q.
4.12 Form of Gold-Denominated II Depositary Receipt. Incorporated by reference to Exhibit 4.3 to the FCX 1994 First Quarter Form 10-Q.
4.13 Certificate of Designations of the Silver-Denominated Preferred Stock of FCX.
4.14 Deposit Agreement dated as of July 25, 1994 among FCX, Mellon Securities Trust Company, as Depositary, and holders of depositary receipts ("Silver-Denominated Depositary Receipts") evidencing certain Depositary shares, each of which, in turn, initially represents 0.025 shares of Silver-Denominated Preferred Stock. Incorporated by reference to Exhibit 4.2 to the July 15, 1994 Form 8-A.
4.15 Form of Silver-Denominated Depositary Receipt. Incorporated by reference to Exhibit 4.1 to the July 15, 1994, Form 8-A.
4.16 Credit Agreement dated as of June 1, 1993 (the "PT-FI Credit Agreement") among PT-FI, the several banks which are parties thereto (the "PT-FI Banks"), Morgan Guaranty Trust Company of New York, as PT-FI Trustee (the "PT-FI Trustee"), and Chemical Bank, as agent (the "PT-FI Bank Agent"). Incorporated by reference to Exhibit 4.10 to the FCX 1993 Form 10-K.
4.17 First Amendment dated as of February 2, 1994 to the PT-FI Credit Agreement among PT-FI, the PT-FI Banks, the PT- FI Trustee and the PT-FI Bank Agent. Incorporated by reference to Exhibit 4.11 to the FCX 1993 Form 10-K.
4.18 Second Amendment dated as of March 1, 1994 to the PT-FI Credit Agreement among PT-FI, the PT-FI Banks, the PT- FI Trustee and the PT-FI Bank Agent. Incorporated by reference to Exhibit 4.12 to the FCX 1993 Form 10-K.
4.19 Third Consent and Waiver dated as of October 18, 1994 to the PT-FI Credit Agreement among PT-FI, the PT-FI Banks, the PT-FI Trustee and the PT-FI Bank Agent.
4.20 Fourth Amendment, Consent and Limited Waiver dated as of November 23, 1994 to the PT-FI Credit Agreement among PT-FI, the PT-FI Banks, the PT-FI Trustee and the PT-FI Bank Agent.
4.21 Term Loan and Working Capital Agreement dated as of November 4, 1994 (the "RTML Term Loan") among Rio Tinto Metal, S.A. ("RTML"), the Lenders and Barclays Bank PLC as Agent (the "Agent").
4.22 Amendment No. 1 dated as of March 7, 1995 to the RTML Term Loan among RTML, the Lenders and the Agent.
4.23 Agreement dated as of May 1, 1988 between Freeport Minerals Company and FCX assigning certain stockholder rights and obligations. Incorporated by reference to Exhibit 10.13 to Registration No. 33-20807.
10.1 Design, Engineering and Related Services Contract dated as of September 15, 1992 between PT-FI and Fluor Daniel Engineers & Constructors, Ltd. Incorporated by reference to Exhibit 10.1 to the FCX 1992 Form 10- K.
10.2 Site Services Contract dated as of September 15, 1992 between PT-FI and Fluor Daniel Eastern, Inc. Incorporated by reference to Exhibit 10.2 to the FCX 1992 Form 10-K.
10.3 Contract of Work dated December 30, 1991 between The Government of the Republic of Indonesia and PT-FI. Incorporated by reference to Exhibit 10.20 to the FCX 1991 Form 10-K.
10.4 Management Services Agreement dated as of May 1, 1988 among FCX, FII and FTX. Incorporated by reference to Exhibit 10.01 to Registration No. 33-20807.
10.5 Concentrate Sales Agreement dated as of December 30, 1990 between FII and Dowa Mining Co., Ltd., Furukawa Co., Ltd., Mitsubishi Materials Corporation, Mitsui Mining & Smelting Co., Ltd., Nittetsu Mining Co., Ltd., Nippon Mining Co., Ltd. and Sumitomo Metal Mining Co., Ltd. (Confidential information omitted and filed separately with the Securities and Exchange Commission.) Incorporated by reference to Exhibit 10.3 to the Annual Report on Form 10-K of FCX for the fiscal year ended December 31, 1990.
12.1 FCX Computation of Ratio of Earnings to Fixed Charges.
13.1 Those portions of the 1994 Annual Report to stockholders of FCX which are incorporated herein by reference.
21.1 Subsidiaries of FCX.
23.1 Consent of Arthur Andersen LLP dated March 23, 1995.
24.1 Certified resolution of the Board of Directors of FCX authorizing this report to be signed on behalf of any officer or director pursuant to a Power of Attorney.
24.2 Powers of Attorney pursuant to which this report has been signed on behalf of certain officers and directors of FCX.
27.1 FCX Financial Data Schedule.