Dec 6 James Flores, chief executive of Plains
Exploration & Production Co, could earn as much in his
new role as head of the oil and gas business at Freeport-McMoRan
Copper & Gold Co as his bosses there.
Freeport on Wednesday said it would buy Plains as well as
another oil and gas company, McMoRan Exploration Co, for
$9 billion in a bold bid to diversify into the U.S. energy
sector as copper's prospects wane. [ID: nL1E8N52E3]
According to a filing with the Securities and Exchange
Commission on Thursday, Flores' base salary will be no less than
that of Chairman Jim Bob Moffett and Chief Executive Richard
Adkerson, who each currently receive a salary of $2.5 million.
Flores, who will report directly to Moffett at Freeport,
will also be eligible for incentive awards and other bonuses in
line with Adkerson and Moffett. Both Adkerson and Moffett
received $18.45 million in total direct compensation, including
their base salaries of $2.5 million, in 2011, according to
Freeport's proxy statement.
The company also disclosed in the filing that Flores agreed
to take a payout of Plains restricted stock units that could be
worth more than $130 million in the form of stock. It was
previously disclosed that Flores would be eligible for a payout
of the Plains stock units and reimbursement of taxes that could
be worth more than $20 million if Plains were bought.
Flores is also in line to make more than $60 million from
Plains shares he already owns.
Freeport on Thursday also disclosed the size of the
termination fees of the two deals in the filing. Should Plains
walk away from its deal, it could owe a breakup fee of $207
million or up to $69 million to reimburse of deal costs to
Freeport in some situations.
Should McMoRan walk away from its deal, it could owe a
breakup fee of $98 million or up to $19.5 million to reimburse
deal costs to Freeport in some situations.