FREEPORT MCMORAN INC, DEF 14A, 1995-03-21

FREEPORT MCMORAN INC
DEF 14A, 1995-03-21
AGRICULTURAL CHEMICALS

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SCHEDULE 14A INFORMATION

Proxy Statement Pursuant to Section 14(a) of the Securities
Exchange Act of 1934 (Amendment No. )

Filed by the Registrant [X]

Filed by a Party other than the Registrant [_]

Check the appropriate box:

[_] Preliminary Proxy Statement [_] Confidential, for Use of the
Commission Only (as permitted by
Rule 14a-6(e)(2))
[X] Definitive Proxy Statement

[_] Definitive Additional Materials

[_] Soliciting Material Pursuant to (S)240.14a-11(c) or (S)240.14a-12

Freeport-McMoRan Inc.
- --------------------------------------------------------------------------------
(Name of Registrant as Specified In Its Charter)

- -------------------------------------------------------------------------------
(Name of Person(s) Filing Proxy Statement, if other than the Registrant)

Payment of Filing Fee (Check the appropriate box):

[X] $125 per Exchange Act Rules 0-11(c)(1)(ii), 14a-6(i)(1), or 14a-6(i)(2)
or Item 22(a)(2) of Schedule 14A.

[_] $500 per each party to the controversy pursuant to Exchange Act Rule 14a-
6(i)(3).

[_] Fee computed on table below per Exchange Act Rules 14a-6(i)(4) and 0-11.

(1) Title of each class of securities to which transaction applies:

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(2) Aggregate number of securities to which transaction applies:

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(3) Per unit price or other underlying value of transaction computed
pursuant to Exchange Act Rule 0-11 (Set forth the amount on which the
filing fee is calculated and state how it was determined):

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(4) Proposed maximum aggregate value of transaction:

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(5) Total fee paid:

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[_] Fee paid previously with preliminary materials.

[_] Check box if any part of the fee is offset as provided by Exchange Act Rule
0-11(a)(2) and identify the filing for which the offsetting fee was paid
previously. Identify the previous filing by registration statement number,
or the Form or Schedule and the date of its filing.

(1) Amount Previously Paid:

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(2) Form, Schedule or Registration Statement No.:

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(3) Filing Party:

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(4) Date Filed:

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Notes:

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[LOGO OF FREEPORT-MCMORAN APPEARS HERE]

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NOTICE OF ANNUAL MEETING OF STOCKHOLDERS

MAY 2, 1995

------------------
March 21, 1995

The Annual Meeting of Stockholders of Freeport-McMoRan Inc. will be held at
the office of the corporation, 1615 Poydras Street, New Orleans, Louisiana, on
Tuesday, May 2, 1995, at 9:00 a.m., for the following purposes:

(1) To elect four of the fifteen directors to hold office for three years
and until their successors are respectively elected and qualified;

(2) To ratify the appointment of Arthur Andersen LLP as the independent
auditors to audit the financial statements of the corporation and its
subsidiaries for the year 1995; and

(3) To transact such other business as may properly come before the
meeting.

The Board of Directors has fixed March 10, 1995, as the record date for the
determination of stockholders entitled to vote at the meeting.

If you will be unable to attend the meeting, kindly mark, sign, date and
return the enclosed proxy. A postage prepaid envelope is enclosed for your use.
Prompt response is helpful, and your cooperation will be appreciated.

By Order of the Board of
Directors.

MICHAEL C. KILANOWSKI, JR.
Secretary
<PAGE>

FREEPORT-MCMORAN INC.
1615 POYDRAS STREET
NEW ORLEANS, LOUISIANA 70112

The Annual Report to Stockholders for the year 1994, including financial
statements, is being mailed to stockholders together with these proxy materials
on or about March 21, 1995.

PROXY STATEMENT

This statement is furnished in connection with a solicitation of proxies by
the Board of Directors (the "Board of Directors" or the "Board") of Freeport-
McMoRan Inc. (the "Company") to be used at the Annual Meeting of Stockholders
of the Company (the "Meeting"), to be held on May 2, 1995.

VOTING PROCEDURE

Stockholders of record at the close of business on March 10, 1995, will be
entitled to vote at the Meeting. On the record date, there were 136,516,816
shares of Common Stock outstanding, and each of such shares will be entitled to
one vote at the Meeting.

The By-Laws of the Company (the "By-Laws") provide that the holders of a
majority of the shares of Common Stock of the Company issued and outstanding
and entitled to vote at the Annual Meeting, present in person or represented by
proxy, shall constitute a quorum at the Annual Meeting. The By-Laws further
provide that directors of the Company shall be elected by a plurality vote and
that, except as otherwise provided by statute, the Certificate of Incorporation
of the Company, or the By-Laws, all other matters coming before the Annual
Meeting shall be decided by the vote of a majority of the number of shares of
Common Stock present in person or represented by proxy at the Annual Meeting
and entitled to vote thereat.

Votes cast at the Annual Meeting will be counted by the persons appointed by
the Company to act as inspectors of election for the Annual Meeting. The
inspectors of election will treat shares of Common Stock represented by a
properly executed and returned proxy as present at the Annual Meeting for
purposes of determining a quorum. Abstentions and broker non-votes with respect
to particular proposals will not affect the determination of a quorum. Thus
shares of Common Stock pursuant to which abstentions are properly cast will be
counted as present for purposes of determining a quorum.

Directors will be elected by a plurality vote of the shares of Common Stock
present, in person or by proxy, and entitled to vote at the Annual Meeting.
Accordingly, abstentions and broker non-votes as to the election of directors
will have no effect thereon. All other matters to come
<PAGE>

before the Annual Meeting require the approval of a majority of the shares of
Common Stock present and entitled to vote thereat; therefore, abstentions as to
particular proposals will have the same effect as votes against such proposals.
Broker non-votes as to particular proposals will not, however, be deemed to be
a part of the voting power present with respect to such proposals and will not
therefore count as votes for or against such proposals and will not be included
in calculating the number of votes necessary for approval of such proposals.

Proxies in the enclosed form are solicited by the Board of Directors of the
Company to provide an opportunity to every stockholder to vote on all matters
scheduled to come before the Meeting, whether or not he or she attends in
person. If proxies in the enclosed form are properly executed and returned, the
shares represented thereby will be voted at the Meeting in accordance with
stockholder direction. Proxies in the enclosed form will be voted for the
election of directors and for the ratification of the appointment of auditors
unless contrary specification is made. Any stockholder executing a proxy may
revoke that proxy or submit a revised one at any time before it is voted. A
stockholder may also attend the Meeting in person and vote by ballot, thereby
cancelling any proxy previously given. Except for the election of directors and
the ratification of the appointment of auditors, management expects no other
matters to be presented for action at the Meeting. If, however, any other
matters properly come before the Meeting, the persons named as proxies in the
enclosed form of proxy intend to vote in accordance with their judgment on the
matters presented.

PROXY SOLICITATION

The cost of soliciting proxies will be borne by the Company. In addition to
solicitations by mail, arrangements have been made for brokers and nominees to
send proxy material to their principals, and the Company will reimburse them
for their reasonable expenses in doing so. The Company has retained Georgeson &
Co. Inc., Wall Street Plaza, New York, New York, to assist it in the
solicitation of proxies from brokers and nominees. It is estimated that the
fees for the services of that firm will be $8,500; the Company will also
reimburse the firm for its reasonable out-of-pocket expenses incurred in
connection with providing the services. Certain employees of the Company, who
will receive no compensation for their services other than their regular
remuneration, may also solicit proxies by telephone, telegram, telex, telecopy,
or personal interview.

STOCKHOLDER PROPOSALS

Any proposal of a stockholder intended to be presented at the Company's 1996
Annual Meeting of Stockholders must be received by the Company for inclusion in
the proxy statement and form of proxy for that meeting no later than November
22, 1995.

2
<PAGE>

CORPORATE GOVERNANCE

The Board of Directors of the Company, which held eight meetings during 1994,
has primary responsibility for directing the management of the business and
affairs of the Company. The Board currently consists of fifteen members. To
provide for effective direction and management of the Company's business, the
Board of Directors has established seven committees of the Board, including the
Audit Committee, the Nominating Committee, and the Corporate Personnel
Committee.

The Audit Committee reviews the financial statements of the Company and
exercises general oversight with respect to the activities of the Company's
independent auditors and Controller and related matters. The Audit Committee
currently consists of Mr. Day as Chairman, and Messrs. Bruce, Coleman,
Harrison, Kissinger, Lackey, and Rankin and Mrs. McDonald, none of whom is an
officer or an employee of the Company or any of its subsidiaries. The Audit
Committee met three times during 1994.

The Nominating Committee makes recommendations to the Board concerning the
structure of the Board, corporate governance, and proposed new members of the
Board and nominates individuals to stand for election as directors. The
Nominating Committee will consider recommendations by stockholders of the
Company of potential nominees for election as directors. The Secretary of the
Company will, upon written request by any stockholder, furnish information
concerning the procedures required in connection with such recommendations. The
Nominating Committee currently consists of Mr. Rankin, as Chairman, and Messrs.
Day, Moffett, Schmidt, and Woods. The Nominating Committee met twice during
1994.

The Corporate Personnel Committee (sometimes hereinafter referred to as the
"Compensation Committee" or the "Committee") reviews and makes recommendations
to the Board with respect to management personnel policies, plans and programs
and employee and officer compensation. The Corporate Personnel Committee
currently consists of Mr. Cunningham, as Chairman, and Messrs. Bruce, Harrison,
Putnam, Wharton, and Woods. The Corporate Personnel Committee met five times
during 1994.

Except for Messrs. Schmidt and Woods, each of the present directors attended
75% or more of the 1994 meetings of the Board and of the committees on which he
or she served during the periods of his or her Board membership and committee
service.

The address of each member of the Board is c/o Freeport-McMoRan Inc., 1615
Poydras Street, New Orleans, Louisiana 70112.

3
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ELECTION OF DIRECTORS

At the Meeting four directors are to be elected to a three-year term, each to
hold office until his or her successor is elected and qualified. The Board of
Directors consists of three classes, each of which serves for three years, with
one class being elected each year. The persons named in the enclosed form of
proxy intend to vote such proxy, unless otherwise directed, for the election of
Messrs. Moffett, Putnam, and Rankin and Mrs. McDonald as members of the class
to serve until the 1998 Annual Meeting of Stockholders. Messrs. Bruce,
Cunningham, Day, Lackey, and Schmidt are members of the class to serve until
the 1996 Annual Meeting of Stockholders, and Messrs. Coleman, Harrison,
Kissinger, Latiolais, Wharton, and Woods are members of the class to serve
until the 1997 Annual Meeting of Stockholders. If, contrary to present
expectation, any of the nominees to be elected at the Meeting should become
unavailable for any reason, the Board of Directors may reduce the size of the
Board or votes may be cast pursuant to the accompanying form of proxy for a
substitute nominee designated by the Nominating Committee.

INFORMATION ABOUT NOMINEES AND DIRECTORS

The following table shows, as of December 31, 1994, the age, principal
occupations and employment during the past five years, other directorships and
positions with the Company of each of the nominees and directors, and the year
in which each such person's present continuous term of office as a director of
the Company began. If the year shown is prior to 1981, the person's present
continuous term of office as a director of the Company was immediately preceded
by a continuous term of office, beginning in such year, as a director of either
Freeport Minerals Company ("Freeport") or of the former McMoRan Oil & Gas Co.
("McMoRan"), the predecessor corporations of the Company. Except for Freeport-
McMoRan Copper & Gold Inc. ("FCX") and Freeport-McMoRan Resource Partners,
Limited Partnership ("FRP"), none of the organizations referred to in such
table is an affiliate of the Company.

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<TABLE>
<CAPTION>
PRINCIPAL OCCUPATIONS, YEAR PRESENT
NAME OF OTHER DIRECTORSHIPS AND TERM OF OFFICE
NOMINEE OR DIRECTOR AGE POSITIONS WITH THE COMPANY AS DIRECTOR BEGAN
------------------------ --- ----------------------------- -----------------
<C> <C> <S> <C>
William H. Cunningham 50 Chancellor of the University 1987
of Texas System. President
of the University of Texas
at Austin until 1992.
Director of Jefferson-Pilot
Corporation, La Quinta Motor
Inns, Inc., MOXY, and each
of the members of the John
Hancock Advisers, Inc. group
of mutual funds.
Robert A. Day 51 Chairman of the Board of 1984
Trust Company of the West.
Director of Abex Inc. and
MOXY.
William B. Harrison, Jr. 51 Vice Chairman of Chemical 1992
Banking Corporation and its
subsidiary, Chemical Bank.
Executive Vice President of
Chemical Bank until 1990.
Director of Chemical Banking
Corporation, Dillard
Department Stores, Inc., and
MOXY.
Henry A. Kissinger 71 Chairman of the Board and 1988
Chief Executive Officer,
Kissinger Associates, Inc.,
international consultants
and consultants to the
Company. Director of
American Express Company,
CBS Inc., and MOXY.
Bobby Lee Lackey 57 President and Chief Executive 1987
Officer of J.S. McManus
Produce Company, Inc.,
grower of vegetables and
shipper of fruits and
vegetables. Director of
MOXY.
Rene L. Latiolais 52 President and Chief Operating 1993
Officer of the Company.
Executive Vice President of
the Company until 1993.
Senior Vice President of the
Company until 1992. Director
of FCX and MOXY.
Gabrielle K. McDonald 52 Judge, International Criminal 1993
Tribunal for
the Former Yugoslavia, and
Distinguished Visiting
Professor of Law, Texas
Southern University Thurgood
Marshall School of
Law. Visiting Professor of
Law, St. Mary's University
School of Law, and of
counsel, Walker &
Satterthwaite, law firm,
until 1993. Shareholder,
Matthews & Branscomb, law
firm, until 1991. Director
of MOXY.
</TABLE>

5
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<TABLE>
<CAPTION>
NAME OF PRINCIPAL OCCUPATIONS, YEAR PRESENT
NOMINEE OR OTHER DIRECTORSHIPS AND TERM OF OFFICE
DIRECTOR AGE POSITIONS WITH THE COMPANY AS DIRECTOR BEGAN
------------------ --- ----------------------------------- -----------------
<C> <C> <S> <C>
James R. Moffett 56 Chairman of the Board, Chief 1969
Executive Officer, and member of
the Office of the Chairman of the
Company. Director of FCX and MOXY.
George Putnam 68 Chairman of The Putnam Investment 1978
Management Company, Inc. and of
each of the members of the Putnam
group of mutual funds. Director of
The Boston Company, Inc., Boston
Safe Deposit and Trust Company,
General Mills, Inc., Houghton-
Mifflin Company, Marsh-McLennan
Companies Inc., MOXY, and
Rockefeller Group, Inc.
B.M. Rankin, Jr. 64 Private investor. Consultant to the 1969
Company. Director of MOXY.
Benno C. Schmidt 81 Senior Partner, J.H. Whitney & Co., 1954
private venture capital investment
firm. Consultant to the Company.
Managing Partner of J.H. Whitney
& Co. until 1992. Director of
Genetics Institute, Inc., Gilead
Sciences, Inc., MOXY, and Vertex
Pharmaceuticals Incorporated. Mr.
Schmidt was formerly a Director
and Chairman of the Board of
Vitarine Pharmaceuticals, Inc.,
which filed
a voluntary petition for
bankruptcy under Chapter 11 of the
United States Bankruptcy Code with
the United States Bankruptcy Court
for the Southern District of New
York on
May 24, 1991.
J. Taylor Wharton 56 Chairman of the Department of 1992
Gynecology at the University of
Texas M.D. Anderson Cancer Center.
Director of MOXY.
Ward W. Woods, Jr. 52 President and Chief Executive 1974
Officer of Bessemer Securities
Corporation, private investment
firm, and Managing General Partner
in Bessemer Holdings, L.P., an
industrial holding company.
Chairman of the Board of BCP/Essex
Holdings Inc., Overhead Door
Corporation, and Stant
Corporation, and director of Boise
Cascade Corporation, Essex Group,
Inc., and MOXY.
</TABLE>

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<PAGE>

COMPLIANCE WITH SECTION 16(A) OF THE SECURITIES EXCHANGE ACT OF 1934

According to (i) the Forms 3 and 4 and any amendments thereto filed pursuant
to Section 16(a) of the Securities Exchange Act of 1934 ("Section 16") and
furnished to the Company during 1994 by persons subject to Section 16 at any
time during 1994 with respect to securities of the Company ("Company Section 16
Insiders"), (ii) the Forms 5 with respect to 1994 and any amendments thereto
filed pursuant to Section 16 and furnished to the Company by Company Section 16
Insiders, and (iii) the written representations from certain Company Section 16
Insiders that no Form 5 with respect to the securities of the Company was
required to be filed by such Company Section 16 Insider, respectively, with
respect to 1994, no Company Section 16 Insider failed to file altogether or
timely any Forms 3, 4, or 5 required by Section 16 with respect to the
securities of the Company or to disclose on such Forms transactions required to
be reported thereon.

STOCK OWNERSHIP OF DIRECTORS AND EXECUTIVE OFFICERS

According to information furnished by each of the directors and executive
officers of the Company, the number of shares of the Company's Common Stock
("Company Shares"), the number of shares of FCX Class A Common Stock ("FCX
Shares"), and the number of Depositary Units ("FRP Units") representing limited
partnership interests in FRP beneficially owned by each of them as of December
31, 1994, was as follows:

<TABLE>
<CAPTION>
NUMBER OF NUMBER OF NUMBER OF
NAME OF COMPANY SHARES FCX SHARES FRP UNITS
INDIVIDUAL OR BENEFICIALLY BENEFICIALLY BENEFICIALLY
IDENTITY OF GROUP OWNED (A) OWNED (A) OWNED (A)
----------------- -------------- ------------ ------------
<S> <C> <C> <C>
Richard C. Adkerson 289,170(b)(c)(d) 5,503(d) 0
Robert W. Bruce III 635,198(b)(e) 23,820(b)(e) 0
Thomas B. Coleman 75,174(b)(f) 14,557(b)(f) 14,379(b)(f)
William H. Cunningham 46,982(b) 1,756(b) 155(b)
Robert A. Day 50,922(b)(g) 373,873(b)(g) 124(b)
Charles W. Goodyear 284,893(b)(c)(h) 0(h) 0
William B. Harrison, Jr. 6,700(b)(i) 250(b)(i) 0
Henry A. Kissinger 40,086(b) 1,503(b) 0
Bobby Lee Lackey 48,203(b)(j) 1,798(b)(j) 203(b)(j)
Rene L. Latiolais 640,893(b)(c) 10,372 617(k)
Gabrielle K. McDonald 260 3 0
George A. Mealey 388,543(b)(c) 16,594 2,269
James R. Moffett 3,551,945(b)(c)(l) 95,302(l) 65,439(l)
George Putnam 2,191,516(b)(m) 3,018,456(b)(m) 125(b)
B.M. Rankin, Jr. 943,508(b)(n) 77,365(b)(n) 4,141(b)(n)
Benno C. Schmidt 729,562(b) 27,349(b) 125(b)
J. Taylor Wharton 35,341(b)(o) 4,250(b)(o) 943(o)
Ward W. Woods, Jr. 105,942(b)(p) 3,967(b) 125(b)
22 directors and executive officers as a group,
including those persons named above 10,762,206(q) 3,753,365(q) 96,825(q)
</TABLE>

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<PAGE>

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(a) Except as otherwise noted, the individuals referred to have sole voting and
investment power with respect to such Shares and Units. With the exceptions
of Mr. Moffett (who beneficially owns 2.6% of the outstanding Company
Shares) and Mr. Putnam (who beneficially owns 1.6% of the outstanding
Company Shares and 4.6% of the outstanding FCX Shares), each of the
individuals referred to holds less than 1% of the outstanding Company
Shares, FCX Shares, and FRP Units, respectively. Mr. Goodyear owns 2,000
Depositary Shares representing Silver-Denominated Preferred Stock of FCX.
An affiliate of Mr. Day owns 5 common shares (which is 5%) of the capital
stock of Freeport-McMoRan Canada Exploration Inc. and 5 common shares
(which is 5%) of the capital stock of Freeport-McMoRan Canada Oil & Gas
Inc., the remaining outstanding shares of which are owned by the Company.
(b) Includes Company Shares, FCX Shares, and FRP Units that could be acquired
within sixty days after December 31, 1994, upon the exercise of options
granted pursuant to the Company's stock option plans, as follows: Mr.
Adkerson, 282,087 Company Shares; Mr. Bruce, 25,198 Company Shares and 945
FCX Shares; Mr. Coleman, 45,542 Company Shares, 1,702 FCX Shares, and 125
FRP Units; Mr. Cunningham, 45,542 Company Shares, 1,702 FCX Shares, and 125
FRP Units; Mr. Day, 40,414 Company Shares, 1,512 FCX Shares, and 62 FRP
Units; Mr. Goodyear, 282,087 Company Shares; Mr. Harrison, 2,500 Company
Shares and 94 FCX Shares; Mr. Kissinger, 35,286 Company Shares and 1,323
FCX Shares; Mr. Lackey, 45,542 Company Shares, 1,702 FCX Shares, and 125
FRP Units; Mr. Latiolais, 454,898 Company Shares; Mr. Mealey, 362,729
Company Shares; Mr. Moffett, 2,016,805 Company Shares; Mr. Putnam, 45,542
Company Shares, 1,702 FCX Shares, and 125 FRP Units; Mr. Rankin, 45,542
Company Shares, 1,702 FCX Shares, and 125 FRP Units; Mr. Schmidt, 45,542
Company Shares, 1,702 FCX Shares, and 125 FRP Units; Mr. Wharton, 2,500
Company Shares and 94 FCX Shares; Mr. Woods, 45,542 Company Shares, 1,702
FCX Shares, and 125 FRP Units; all directors and executive officers as a
group (21 persons), 4,348,531 Company Shares, 15,882 FCX Shares, and 937
FRP Units.
(c) Includes Company Shares held by the trustee under the Company's Employee
Capital Accumulation Program, as follows: Mr. Adkerson, 3,423 Company
Shares; Mr. Goodyear, 2,742 Company Shares; Mr. Latiolais, 16,022 Company
Shares; Mr. Mealey, 9,914 Company Shares; Mr. Moffett, 23,742 Company
Shares; all directors and executive officers as a group (8 persons), 85,373
Company Shares.
(d) Includes 776 Company Shares that may be acquired upon the conversion of
6.55% Convertible Subordinated Notes due January 15, 2001 of the Company
("Company Notes") held in trust for the benefit of Mr. Adkerson, 2,884
Company Shares that may be acquired upon the conversion of Zero Coupon
Convertible Subordinated Debentures due 2006 of the Company ("Company
Debentures") held in trust for the benefit of Mr. Adkerson, and 5,503 FCX
Shares held in trust for the benefit of Mr. Adkerson.

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<PAGE>

(e) Includes 600,000 Company Shares and 22,500 FCX Shares held by a limited
partnership with respect to which Mr. Bruce has shared voting and
investment power.
(f) Includes a total of 27,762 Company Shares, 12,786 FCX Shares, and 7,500 FRP
Units held by three trusts established for the benefit of Mr. Coleman's
three daughters with respect to which Mr. Coleman holds sole voting and
investment power but with respect to which he disclaims beneficial
ownership. Includes a total of 6,754 FRP Units held for the benefit of such
trusts by the custodian under FRP's Depositary Unit Reinvestment Plan with
respect to which Mr. Coleman holds sole voting and investment power but
with respect to which he disclaims beneficial ownership.
(g) Includes 5,400 Company Shares and 180 FCX Shares held by accounts and funds
managed by affiliates of a corporation of which Mr. Day is the chief
executive officer and in which he is a stockholder. Mr. Day has shared
voting and investment power with respect to such Shares but disclaims
beneficial ownership thereof. Includes 371,992 FCX Shares that may be
acquired upon the conversion of Depositary Shares representing Step-Up
Convertible Preferred Stock of FCX ("FCX Step-Up Convertible Preferred
Stock") held by accounts and funds managed by affiliates of such
corporation with respect to which Mr. Day holds shared voting and
investment power but with respect to which he disclaims beneficial
ownership. Mr. Day is a beneficiary of a trust that holds 600,000 Company
Shares and 22,500 FCX Shares. Mr. Day has no voting or investment power
with respect to such Shares and disclaims beneficial ownership thereof.
(h) See note (a) above. Includes 64 Company Shares held in a retirement trust
for the benefit of Mr. Goodyear.
(i) Includes 1,200 Company Shares and 45 FCX Shares owned by Mr. Harrison's
wife.
(j) Includes 1,434 Company Shares, 51 FCX Shares, and 25 FRP Units held in a
retirement trust for the benefit of Mr. Lackey, 383 Company Shares held for
the benefit of Mr. Lackey by the custodian under the Company's Automatic
Stock Purchase Plan, and 53 FRP Units held for the benefit of Mr. Lackey by
the custodian under FRP's Depositary Unit Reinvestment Plan.
(k) Includes 483 FRP Units held for the benefit of Mr. Latiolais by the
custodian under FRP's Depositary Unit Reinvestment Plan.
(l) Includes a total of 85,140 Company Shares, 30,149 FCX Shares, and 25,839
FRP Units held for the benefit of two trusts created by Mr. Moffett for the
benefit of his two children, who are adults. An executive officer of the
Company and another individual, as co-trustees of the two trusts, have sole
voting and investment power with respect to such Shares and Units held for
the benefit of such trusts but have no beneficial interest therein. Mr.
Moffett and such executive officer disclaim beneficial ownership of such
Shares and Units held for the benefit of such trusts. Includes a total of
214,648 Company Shares, 21,959 FCX Shares, and 39,600 FRP Units held for
the benefit of a trust with respect to which Mr. Moffett and an executive

9
<PAGE>

officer of the Company, as co-trustees of such trust, have sole voting and
investment power but have no beneficial interest therein. Mr. Moffett and
such executive officer disclaim beneficial ownership of such Shares and
Units held for the benefit of such trust. Includes a total of 88,000 Company
Shares and 675 FCX Shares held for the benefit of a trust created by Mr.
Moffett for the benefit of an educational fund and his two children, who are
adults. An executive officer of the Company and another individual, as co-
trustees of such trust, have sole voting and investment power with respect
to such Company Shares held for the benefit of such trust but have no
beneficial interest therein. Mr. Moffett and such executive officer disclaim
beneficial ownership of such Company Shares held for the benefit of such
trust.
(m) Includes 3,230 Company Shares and 120 FCX Shares held by a charitable trust
with respect to which Mr. Putnam holds as co-trustee shared voting and
investment power but with respect to which he disclaims beneficial
ownership. Includes 2,000 Company Shares and 50 FCX Shares held by a trust
with respect to which Mr. Putnam holds as trustee sole voting and
investment power. Includes 1,573,400 Company Shares and 2,045,810 FCX
Shares held by mutual funds with respect to which Mr. Putnam holds shared
voting and investment power but with respect to which he disclaims
beneficial ownership. Includes 389,429 Company Shares that may be acquired
upon the conversion of $4.375 Convertible Exchangeable Preferred Stock of
the Company ("Company Preferred Stock"), 164,407 Company Shares that may be
acquired upon the conversion of Company Debentures, and 970,270 FCX Shares
that may be acquired upon the conversion of FCX Step-Up Convertible
Preferred Stock held by such mutual funds with respect to which Mr. Putnam
holds shared voting and investment power but with respect to which he
disclaims beneficial ownership.
(n) Includes 3,340 FCX Shares that may be acquired upon the conversion of FCX
Step-Up Convertible Preferred Stock. Includes 346,992 Company Shares,
45,062 FCX Shares, and 4,000 FRP Units with respect to which Shares and
Units Mr. Rankin has under a power of attorney sole voting and investment
power but with respect to which he disclaims beneficial ownership. Includes
6,680 FCX Shares that may be acquired upon the conversion of FCX Step-Up
Convertible Preferred Stock with respect to which Mr. Rankin has under
powers of attorney sole voting and investment power but with respect to
which he disclaims beneficial ownership. Includes 16 FRP Units held by the
custodian under FRP's Depositary Unit Reinvestment Plan with respect to
which Mr. Rankin has under a power of attorney voting and investment power
but with respect to which he disclaims beneficial ownership.
(o) Includes 420 FCX Shares held in a retirement trust for the benefit of Mr.
Wharton, 9,130 Company Shares and 2,853 FCX Shares held by Mr. Wharton's
wife, 160 FCX Shares held in a retirement trust for the benefit of Mr.
Wharton's wife, and a total of 4,736 Company Shares and 249 FCX Shares held
by Mr. Wharton as custodian for his daughters. Includes Company Shares held
by the custodian under the Company's Automatic Stock Purchase Plan as
follows: 4,393 Company Shares for the benefit of Mr. Wharton, 3,591 Company
Shares for the benefit of Mr. Wharton's wife, and a total of 2,047 Company
Shares for the benefit of

10
<PAGE>

Mr. Wharton as custodian for his daughters. Includes FRP Units held by the
custodian under FRP's Depositary Unit Reinvestment Plan as follows: 409
Units for the benefit of Mr. Wharton, 284 Units for the benefit of Mr.
Wharton's wife, and a total of 250 Units for the benefit of Mr. Wharton as
custodian for his daughters.
(p) Includes 17,500 Company Shares held by a charitable foundation with respect
to which Mr. Woods holds shared voting and investment power but with
respect to which he disclaims beneficial ownership.
(q) See notes (b) through (p) above. Includes 1,516 Company Shares, 8,474 FCX
Shares, and 6 FRP Units held in trust for the benefit of one of the
executive officers, 92 Company Shares and a total of 2,183 FCX Shares held
by or in trust for the benefit of the spouse of such executive officer as
to which beneficial ownership is disclaimed, and a total of 2,300 Company
Shares and 14,544 FCX Shares held by such executive officer as custodian as
to which beneficial ownership is disclaimed. These total numbers represent
approximately 7.6% of the outstanding Company Shares, approximately 5.6% of
the outstanding FCX Shares, and less than 1% of the outstanding FRP Units.

STOCK OWNERSHIP OF CERTAIN BENEFICIAL OWNERS

According to information furnished by each of the persons known to the
Company to be a beneficial owner of more than five percent of Company Shares,
the number of Company Shares beneficially owned by each of them as of December
31, 1994, was as follows:

<TABLE>
<CAPTION>
NUMBER OF
COMPANY SHARES PERCENT
NAME AND ADDRESS OF PERSON BENEFICIALLY OWNED OF CLASS
-------------------------- ------------------ --------
<S> <C> <C>
Oppenheimer Group, Inc. 25,418,352(a) 18.5%
Oppenheimer Tower
World Financial Center
New York, New York 10281
The Capital Group Companies, Inc. 10,251,900(b) 7.4%
333 South Hope Street
Los Angeles, California 90071
</TABLE>
- --------
(a) Oppenheimer Group, Inc. has, indirectly through subsidiaries, shared voting
and investment power as to all 25,418,352 Company Shares. Oppenheimer
Group, Inc. disclaims beneficial ownership of all 25,418,352 Company
Shares.
(b) The Capital Group Companies, Inc. has, indirectly through five
subsidiaries, sole voting power as to 5,933,140 of such Company Shares and
sole investment power as to all 10,251,900 Company Shares. Of such
10,251,900 Company Shares, 724,300 may be acquired upon the conversion of
Company Preferred Stock and 517,840 may be acquired upon the conversion of
Company Debentures. The Capital Group Companies, Inc. disclaims beneficial
ownership of all 10,251,900 Company Shares.

11
<PAGE>

COMPENSATION OF DIRECTORS AND RELATED TRANSACTIONS

Each director who is not an officer of the Company or its subsidiaries
receives a fee of $1,000 for attendance at each meeting of the Board or any of
its committees and an annual fee consisting of (i) $25,000 for serving on the
Board (the "standard portion of the annual fee"), (ii) $3,000 for each
committee of which he or she is a member, and (iii) $3,000 for each committee
of which he or she is the chairman. Directors who are also officers of the
Company or its subsidiaries receive a $1,000 fee for each Board meeting that
they attend, but they are not entitled to an annual fee or to fees for
attendance at meetings of committees of the Board.

The additional taxable income recognized by Messrs. Bruce, Coleman, and
Kissinger for their nonbusiness use in 1994 of aircraft owned or leased by the
Company was approximately $627, $6,698, and $1,353, respectively.

In addition to the cash compensation referred to above, Mr. Rankin received
during 1994 certain other compensation consisting of reimbursement for a
portion of his office rent and the services of an executive secretary employed
by the Company. The aggregate amount of such compensation in 1994 was $76,187.

The Company and Mr. Rankin entered into an agreement pursuant to which Mr.
Rankin renders from time to time services to the Company relating to finance,
accounting, and business development. In consideration for such services, the
Company pays Mr. Rankin an annual retainer totalling $56,000.

The Company and a corporation wholly owned by Mr. Rankin have entered into an
arrangement whereby the Company is entitled to the use of a Cessna Citation
S/II aircraft in which such corporation has an interest. Under the arrangement,
the Company has agreed to pay such corporation charges, assessments, and an
annual fee that are directly related to the Company's use of the plane and a
fixed monthly fee. In 1994 the Company paid such corporation $138,720 under
this arrangement.

Kissinger Associates, Inc. ("Kissinger Associates"), a corporation of which
Mr. Kissinger is Chairman of the Board and the sole stockholder, provides to
the Company advice and consultation on world political, economic, strategic,
and social developments affecting the Company's affairs. As compensation for
such services, the Company has agreed to pay Kissinger Associates $200,000 per
annum and all reasonable out-of-pocket expenses incurred in connection with
providing such services.

Kissinger Associates also provides to the Company consulting and related
advisory services of Mr. Kissinger on international matters. The Company paid
Kissinger Associates $400,000 for services in 1994 under this additional
arrangement.

12
<PAGE>

The Company and Mr. Schmidt entered into an agreement pursuant to which Mr.
Schmidt renders from time to time services to the Company with respect to
technical, business, and governmental activities. In consideration for such
services, the Company pays Mr. Schmidt an annual retainer of $100,000.

The Company and a corporation wholly owned by Mr. Schmidt have entered into
an arrangement whereby the Company is entitled to the use of a Jetstar II
aircraft owned by such corporation. Under the arrangement, the Company has
agreed to bear 40% of all actual costs incurred in connection with the
operation of the aircraft other than fuel costs, the obligation for which is
determined by the Company's actual percentage use of the plane. In 1994 the
Company incurred $400,029 in costs under this arrangement.

In recognition of the services of Mr. Moffett as Chairman of the Board of the
Company, and to enhance the probability that such services will continue in the
future, the Company made a non-interest bearing, non-transferable demand loan
to him in 1988. The balance as of January 1, 1994, of the principal amount on
such loan was $1,080,000. As additional compensation for services, the Company
forgave in 1994 $270,000 of the principal amount of such loan. The remaining
balance as of December 31, 1994, of the principal amount on such loan was
$810,000.

John G. Amato, who was appointed General Counsel of the Company by the Board
in 1989, is not an employee of the Company. Under his arrangement with the
Company, Mr. Amato is furnished with an office suite in the Company
headquarters, certain office equipment, and the services of an executive
secretary employed by the Company. In consideration for the legal services
rendered to the Company and its subsidiaries and affiliates, Mr. Amato was paid
$1,000,000. The Company provides Mr. Amato with financial counseling services;
the amount of such compensation in 1994 was $19,000. The additional taxable
income recognized by Mr. Amato for his nonbusiness use in 1994 of the aircraft
owned or leased by the Company was approximately $489. The amount of matching
gifts made by the Company in regard to Mr. Amato during 1994 under the Matching
Gifts Program of the Company was $20,000.

PLAN FOR DEFERRAL OF DIRECTORS' FEES

Under the 1991 Plan for Deferral of Directors' Fees (the "Deferral Plan"), a
participating director may elect to defer the payment of either or both such
participant's annual fees and such participant's attendance fees for services
as a member of the Board and any committee of the Board. The deferred amounts
are, at the direction of the participant, credited to one or two accounts in
specified percentages. Fees credited to the deferred cash account earn interest
at a rate equal to the prime lending rate announced from time to time by The
Chase Manhattan Bank, N.A., compounded quarterly. Fees credited to the deferred
stock account are converted to stock units, which are related to Company Shares
and earn dividend equivalents, which are related to dividends on Company
Shares. Dividend equivalents so credited are converted into additional

13
<PAGE>

stock units, determined on the basis of the fair market value of Company
Shares. One or more cash payments of the total amounts credited to a
participant's accounts will be made following the cessation of the
participant's service as a director of the Company, in accordance with a
payment schedule selected by the participant.

RETIREMENT PLAN FOR NON-OFFICER DIRECTORS

The Company has a retirement plan for the benefit of non-officer directors
age sixty-five or over who have completed five or more years of service on the
Board. Under the retirement plan, an eligible Board member will be entitled to
an annual benefit equal to a percentage of the standard portion of the annual
fee for a Board member at the time of his or her retirement. The amount of such
percentage, which would be at least 50% but not greater than 100%, will depend
on the number of years the retiree served as a non-officer member of the Board
and the number of years, if any, the retiree served as a non-officer member of
the board of Freeport or McMoRan prior to April 7, 1981. The benefit would be
payable from the date of retirement until the retiree's death.

STOCK OPTION PLAN FOR NON-EMPLOYEE DIRECTORS

Each present director of the Company who is not an employee of the Company is
an "Eligible Director" for the grant of options under the 1988 Stock Option
Plan for Non-Employee Directors (the "1988 Plan"). On May 1 of each year
through 1997, each individual who is on such date an Eligible Director will be
granted a nonqualified option to purchase 10,000 Company Shares at 100% of the
fair market value of Company Shares on the date of such grant. All options
granted under the 1988 Plan expire ten years and two days after their
respective dates of grants.

On May 1, 1994, each of the directors of the Company other than Messrs.
Latiolais and Moffett were granted under the 1988 Plan an option for 10,000
Company Shares at an original option price of $19.125. In 1994 none of the
directors exercised options granted under the 1988 Plan.

DIRECTORS' CHARITABLE GIFT PROGRAM

Under the Directors' Charitable Gift Program of the Company, each of the
directors of the Company is entitled to designate no more than four eligible
charities to receive a charitable donation in the aggregate amount of
$1,000,000 from the Company upon such director's death, provided the
termination of such director's service occurs as a result of death, disability,
retirement, or a change in the composition of the Board after certain corporate
transactions. Eligible charities include educational institutions, educational
associations, educational funds, cultural institutions, social service
community organizations, hospital organizations, and environmental
organizations. General Company assets and life insurance policies on the lives
of the directors, which policies are purchased and owned by the Company, will
provide the funding for the charitable gifts to be made under the Directors'
Charitable Gift Program.

14
<PAGE>

MATCHING GIFTS PROGRAM

The Matching Gifts Program of the Company is available to the directors,
full-time consultants, and employees of the Company. Under the Matching Gifts
Program, the Company will match gifts made by a participant to eligible
institutions including educational institutions, educational associations,
educational funds, cultural institutions, social service community
organizations, hospital organizations, and environmental organizations. Such
gifts are made by the Company directly to the institution. Gifts made by a
director to an eligible institution not in excess of $1,000 will be double
matched by the Company, and gifts made by any other participant to an eligible
institution not in excess of $500 will be double matched by the Company. The
annual amount of matching gifts made by the Company in regard to a director may
not exceed $40,000, and the annual amount of matching gifts made by the Company
in regard to any other participant may not exceed $20,000. The amounts of the
matching gifts made by the Company in 1994 in regard to each of the
participating directors were as follows: $38,000 for Mr. Bruce, $39,778 for Mr.
Coleman, $14,593 for Mr. Cunningham, $40,000 for Mr. Day, $10,500 for Mr.
Harrison, $34,500 for Mr. Kissinger, $4,500 for Mr. Lackey, $4,849 for Mr.
Latiolais, $40,000 for Mr. Moffett, $40,000 for Mr. Putnam, $33,250 for Mr.
Rankin, and $40,000 for Mr. Woods.

15
<PAGE>

COMPENSATION OF EXECUTIVE OFFICERS

The following table shows plan and non-plan compensation awarded to, earned
by, or paid to the chief executive officer of the Company and each of the four
most highly compensated executive officers of the Company other than such chief
executive officer who served as executive officers of the Company at the end of
1994 (collectively, the "Named Executive Officers") for all services rendered
in all capacities to the Company and its subsidiaries in 1994, 1993, and 1992.

SUMMARY COMPENSATION TABLE

<TABLE>
<CAPTION>
LONG TERM COMPENSATION
------------------------------------
ANNUAL COMPENSATION AWARDS PAYOUTS
---------------------------------------- ---------------------- -------------
(A) (B) (C) (D) (E) (F) (G) (H) (I)
SECURITIES
RESTRICTED UNDERLYING
NAME AND OTHER ANNUAL STOCK OPTIONS/ LTIP ALL OTHER
PRINCIPAL POSITION YEAR SALARY($) BONUS($) COMPENSATION($) AWARD(S)($) SARS(#) PAYOUTS($)(1) COMPENSATION($)
------------------ ---- --------- --------- --------------- ----------- ---------- ------------- ---------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
James R. Moffett, 1994 1,250,000 3,149,900 538,418(2) 0 0 566,500 83,553(3)
Chairman of the 1993 661,500 0 543,999(2) 0 0 791,000 48,332(3)
Board and Chief 1992 661,500 875,000 646,635(2) 0 750,000 3,497,058(4) 45,796(3)
Executive Officer
Rene L. Latiolais, 1994 700,000 2,263,900 85,464(5) 0 0 226,600 44,303(6)
President and Chief 1993 325,000 300,000 410,734(5) 0 124,200 316,400 23,992(6)
Operating Officer 1992 279,583 400,000 9,678(5) 0 450,000 1,057,739(7) 15,285(6)
George A. Mealey, 1994 600,000 1,476,500 7,731(8) 0 0 226,600 35,790(9)
Executive Vice 1993 300,000 250,000 10,255(8) 0 0 158,200 22,984(9)
President 1992 270,833 400,000 81,625(8) 0 450,000 187,800 19,763(9)
Richard C. Adkerson, 1994 500,000 1,476,500 8,914(10) 0 110,100 113,300 31,830(11)
Senior Vice President 1993 250,000 200,000 8,776(10) 0 82,800 158,200 28,367(11)
and Chief Financial 1992 250,000 150,000 6,235(10) 0 150,000 187,800 13,731(11)
Officer
Charles W. Goodyear, 1994 500,000 1,476,500 6,113(12) 0 110,100 113,300 23,250(13)
Senior Vice President 1993 250,000 200,000 4,415(12) 0 82,800 158,200 12,500(13)
and Chief Investment 1992 250,000 150,000 2,370(12) 0 150,000 187,800 12,500(13)
Officer
</TABLE>
- ---------
(1) In 1987 the Company granted for the last time performance units pursuant to
a long-term incentive plan adopted in 1981 (the "1981 LTIP"), under which
amounts were credited during a six-year period. In 1988 the Company granted
for the first time performance units pursuant to a long-term incentive plan
adopted in 1987 (the "1987 LTIP"), under which amounts are credited during
a shorter, four-year period. Thus, as a result of the reduction of the
period during which credits are made with respect to units, those executive
officers fully participating in both the 1981 LTIP and the 1987 LTIP
received payouts under both plans in 1992, as reflected in certain of the
amounts set forth in column (h) of this table for such

16
<PAGE>

years (see notes (4) and (7) below). The last payouts under the 1981 LTIP
were made with respect to 1992; therefore, the executive officers of the
Company will no longer receive credits and payouts under the 1981 LTIP.
(2) These reported amounts for 1994, 1993, and 1992 consist, respectively, of
(i) $38,398, $23,471, and $23,730, which were the amounts paid by the
Company to or on behalf of Mr. Moffett during 1994, 1993, and 1992,
respectively, for taxes in connection with certain benefits provided by the
Company to Mr. Moffett, and (ii) $500,020, $520,528, and $622,905, which
were the total amounts of the perquisites provided by the Company to Mr.
Moffett in 1994, 1993, and 1992, respectively. Such perquisites for 1994,
1993, and 1992 consist, respectively, of (a) $270,000, $270,000, and
$270,000, which were the portions of the principal amount of a non-interest
bearing loan to Mr. Moffett from the Company that were forgiven in 1994,
1993, and 1992, respectively, (b) $80,793, $92,925, and $125,723, which
were the amounts of the imputed interest in 1994, 1993, and 1992,
respectively, on such loan to Mr. Moffett from the Company, (c) $40,000,
$40,000, and $40,000, which were the amounts of matching gifts made by the
Company in regard to Mr. Moffett during 1994, 1993, and 1992, respectively,
under the Matching Gifts Program of the Company, (d) $19,000, $19,000, and
$19,000, which were the amounts paid by the Company during 1994, 1993, and
1992, respectively, for financial counseling and tax return preparation and
certification services provided to Mr. Moffett, and (e) $90,227, $98,603,
and $168,182, which were the amounts of the additional federal income
recognized for federal income tax purposes by Mr. Moffett for his use of
the Company's aircraft in 1994, 1993, and 1992, respectively.
(3) These reported amounts for 1994, 1993, and 1992 consist, respectively, of
(i) $60,766, $33,075, and $33,075, which were the aggregate amounts of
contributions made by the Company in 1994, 1993, and 1992, respectively, to
the accounts of Mr. Moffett under defined contribution plans of the
Company; (ii) $15,787, $8,257, and $7,721, which were the amounts of the
insurance premiums paid by the Company in 1994, 1993, and 1992,
respectively, with respect to an individual universal life insurance policy
for the benefit of Mr. Moffett; and (iii) $7,000, $7,000, and $5,000, which
were the amounts of the fees paid by the Company in 1994, 1993, and 1992,
respectively, to Mr. Moffett for attendance at Board meetings.
(4) Of the amount reported for 1992, $2,558,058 was paid to Mr. Moffett under
the 1981 LTIP and $939,000 was paid to Mr. Moffett under the 1987 LTIP.
(5) These reported amounts for 1994, 1993, and 1992 consist, respectively, of
(i) $23,402, $410,734, and $9,678, which were the amounts paid by the
Company to or on behalf of Mr. Latiolais during 1994, 1993, and 1992,
respectively, for taxes in connection with certain benefits provided by the
Company to Mr. Latiolais, including, with respect to 1993 only, $395,533 in
"tax-offset payments" made by the Company to Mr. Latiolais upon the
exercise of Company stock options by Mr. Latiolais in 1993, and, with
respect to 1994 only, (ii) $62,062, which was the total amount of the
perquisites provided by the Company to Mr. Latiolais in 1994. Such
perquisites for 1994 consist of (a) $4,849, which was the amount of

17
<PAGE>

matching gifts made by the Company in regard to Mr. Latiolais during 1994
under the Matching Gifts Program of the Company, (b) $20,360, which was the
amount paid by the Company during 1994 for financial counseling and tax
return preparation and certification services provided to Mr. Latiolais,
and (c) $36,853, which was the amount of the additional federal income
recognized for federal income tax purposes by Mr. Latiolais for his use of
the Company's aircraft in 1994. These reported amounts for 1993 and 1992 do
not include the total amounts of the perquisites provided by the Company to
Mr. Latiolais in 1993 and 1992, respectively, which were less than $50,000
in each such year.
(6) These reported amounts for 1994, 1993, and 1992 consist, respectively, of
(i) $33,273, $16,250, and $13,980, which were the aggregate amounts of
contributions made by the Company in 1994, 1993, and 1992, respectively, to
the accounts of Mr. Latiolais under defined contribution plans of the
Company; (ii) $5,030, $3,742, and $1,305, which were the amounts of the
insurance premiums paid by the Company in 1994, 1993, and 1992,
respectively, with respect to an individual universal life insurance policy
for the benefit of Mr. Latiolais; and, with respect to 1994 and 1993 only,
(iii) $6,000 and $4,000, which were the amounts of the fees paid by the
Company in 1994 and 1993, respectively, to Mr. Latiolais for attendance at
Board meetings.
(7) Of the amount reported for 1992, $682,139 was paid to Mr. Latiolais under
the 1981 LTIP and $375,600 was paid to Mr. Latiolais under the 1987 LTIP.
(8) These reported amounts for 1994, 1993, and 1992 are, respectively, the
aggregate amounts paid by the Company to or on behalf of Mr. Mealey during
1994, 1993, and 1992, respectively, for taxes in connection with certain
benefits provided by the Company to Mr. Mealey, including, with respect to
1992 only, $74,273 in "tax-offset payments" made by the Company to Mr.
Mealey upon the exercise of Company stock options by Mr. Mealey in 1992.
These reported amounts for 1994, 1993, and 1992 do not include the total
amounts of the perquisites provided by the Company to Mr. Mealey in 1994,
1993, and 1992, respectively, which were less than $50,000 in each such
year.
(9) These reported amounts for 1994, 1993, and 1992 consist, respectively, of
(i) $28,263, $15,001, and $13,542, which were the aggregate amounts of
contributions made by the Company in 1994, 1993, and 1992, respectively, to
the accounts of Mr. Mealey under defined contribution plans of the Company,
and (ii) $7,527, $7,983, and $6,221, which were the amounts of the
insurance premiums paid by the Company in 1994, 1993, and 1992,
respectively, with respect to an individual universal life insurance policy
for the benefit of Mr. Mealey.
(10) These reported amounts for 1994, 1993, and 1992 are, respectively, the
aggregate amounts paid by the Company to or on behalf of Mr. Adkerson
during 1994, 1993, and 1992, respectively, for taxes in connection with
certain benefits provided by the Company to Mr. Adkerson. These reported
amounts for 1994, 1993, and 1992 do not include the total

18
<PAGE>

amounts of the perquisites provided by the Company to Mr. Adkerson in 1994,
1993, and 1992, respectively, which were less than $50,000 in each such
year.
(11) These reported amounts for 1994, 1993, and 1992 consist, respectively, of
(i) $23,250, $12,500, and $12,500, which were the aggregate amounts of
contributions made by the Company in 1994, 1993, and 1992, respectively,
to the accounts of Mr. Adkerson under defined contribution plans of the
Company; (ii) $1,180, $1,317, and $1,231, which were the amounts of the
insurance premiums paid by the Company in 1994, 1993, and 1992,
respectively, with respect to an individual universal life insurance
policy for the benefit of Mr. Adkerson; and, with respect to 1994 and 1993
only, (iii) $7,400 and $14,550, which were the amounts of the scholarships
provided by the Company in 1994 and 1993, respectively, for the benefit of
one or more of Mr. Adkerson's sons.
(12) These reported amounts for 1994, 1993, and 1992 are, respectively, the
aggregate amounts paid by the Company to or on behalf of Mr. Goodyear
during 1994, 1993, and 1992, respectively, for taxes in connection with
certain benefits provided by the Company to Mr. Goodyear. These reported
amounts for 1994, 1993, and 1992 do not include the total amounts of the
perquisites provided by the Company to Mr. Goodyear in 1994, 1993, and
1992, respectively, which were less than $50,000 in each such year.
(13) These reported amounts for 1994, 1993, and 1992 consist, respectively, of
the aggregate amounts of contributions made by the Company in 1994, 1993,
and 1992, respectively, to the accounts of Mr. Goodyear under defined
contribution plans of the Company.

The following table sets forth information with respect to all stock options
and freestanding stock appreciation rights ("SARs") granted in 1994 by the
Company to each of the Named Executive Officers.

OPTION/SAR GRANTS IN LAST FISCAL YEAR

<TABLE>
<CAPTION>
GRANT DATE
INDIVIDUAL GRANTS VALUE
- ------------------------------------------------------------------------ ----------
(A) (B) (C) (D) (E) (F)
NUMBER OF % OF TOTAL
SECURITIES OPTIONS/SARS
UNDERLYING GRANTED TO EXERCISE OR GRANT DATE
OPTIONS/SARS EMPLOYEES IN BASE EXPIRATION PRESENT
NAME GRANTED (#) (I) FISCAL YEAR PRICE($/SH) DATE VALUE $(II)
---- --------------- ------------ ----------- ---------- ----------
<S> <C> <C> <C> <C> <C>
James R. Moffett 0 -- -- -- --
Rene L. Latiolais 0 -- -- -- --
George A. Mealey 0 -- -- -- --
Richard C. Adkerson 110,100 7.7% $19.4375 05/03/04 $170,655
Charles W. Goodyear 110,100 7.7% $19.4375 05/03/04 $170,655
</TABLE>

19
<PAGE>

- ---------
(i) Each of the stock options and SARs granted in 1994 by the Company to the
Named Executive Officers is not immediately exercisable. Twenty-five
percent of the number of stock options or SARs covered by each such grant
will become exercisable on the first, second, third, and fourth
anniversaries of the respective date of grant thereof. Such stock options
and SARs will, however, become immediately exercisable in their entirety at
such time as there shall be a "Change in Control" in the Company, as that
term is defined in the agreements evidencing such stock options and SARs.
Each of the stock options granted in 1994 by the Company to the Named
Executive Officers has an equal number of "Limited Rights" granted in
tandem therewith. Each such "Limited Right" may be exercisable only for a
limited period in the event of any tender offer, exchange offer, or series
of purchases or other acquisitions, or any combination of those
transactions, as a result of which more than 40% of the Company Shares
outstanding are acquired in such offer. Each such "Limited Right" entitles
the holder thereof to receive an amount in cash equal to the excess of the
highest price paid in such offer over the exercise price of the stock
option with which it is in tandem.
(ii) The Black-Scholes option pricing model was used to determine the grant
date present value of the stock options and SARs granted in 1994 by the
Company to the Named Executive Officers. Under the Black-Scholes option
pricing model, the grant date present value of each stock option and SAR
referred to in the table was calculated to be $1.55. The following facts
and assumptions were used in making such calculation: (i) an unadjusted
exercise price of $19.4375 for each such stock option and SAR; (ii) a fair
market value of $19.4375 for one Company Share on the date of grant; (iii)
a dividend yield of 9.71%, derived from dividing (x) $1.8875, which was
the value of the dividend paid on one Company Share in 1994, by (y)
$19.4375, which was the fair market value of one Company Share on the date
of grant; (iv) a stock option or SAR term of 10 years; (v) a stock
volatility of 22.26%, based on an analysis of weekly closing stock prices
of Company Shares and dividends paid on Company Shares during the three-
year period prior to the date of grant; and (vi) an assumed risk-free
interest rate of 7.38%, which is equivalent to the yield on a ten-year
treasury note on the date of grant. No other discounts or restrictions
related to vesting or the likelihood of vesting of stock options or SARs
were applied. The resulting grant date present value of $1.55 for each
stock option and SAR was multiplied by the total number of stock options
and SARs granted to each of the Named Executive Officers to determine the
total grant date present value of such stock options and SARs granted to
each Named Executive Officer, respectively.

20
<PAGE>

The following table sets forth information with respect to any exercises of
Company stock options and SARs in 1994 by each of the Named Executive Officers
and all outstanding Company stock options and SARs held by each of the Named
Executive Officers as of December 31, 1994.

AGGREGATED OPTION/SAR EXERCISES IN LAST FISCAL YEAR
AND FY-END OPTION/SAR VALUES

<TABLE>
<CAPTION>
(A) (B) (C) (D) (E)
NUMBER OF
SECURITIES VALUE OF
UNDERLYING UNEXERCISED
UNEXERCISED IN-THE-MONEY
OPTIONS/SARS OPTIONS/SARS
AT FY-END (#) AT FY-END($)

SHARES ACQUIRED VALUE EXERCISABLE/ EXERCISABLE/
NAME ON EXERCISE(#) REALIZED($) UNEXERCISABLE* UNEXERCISABLE*
---- --------------- ----------- -------------- --------------
<S> <C> <C> <C> <C>
James R. Moffett 0 -- 3,025,203 $9,937,928
400,283* $ 41,309*
Rene L. Latiolais 0 -- 685,465 $1,288,846
309,600* $ 135,356*
George A. Mealey 0 -- 539,801 $ 576,093
240,170* $ 24,785*
Richard C. Adkerson 0 -- 425,208 $ 866,563
263,863* $ 83,246*
Charles W. Goodyear 0 -- 403,671 $ 811,010
263,863* $ 83,246*
</TABLE>

21
<PAGE>

The following table sets forth information with respect to all long-term
incentive plan awards made in 1994 by the Company to each of the Named
Executive Officers.

LONG-TERM INCENTIVE PLANS--AWARDS IN LAST FISCAL YEAR

<TABLE>
<CAPTION>
ESTIMATED FUTURE PAYOUTS
UNDER NON-STOCK PRICE-BASED PLANS
--------------------------------------
(A) (B) (C) (D) (E) (F)
PERFORMANCE
OR OTHER
NUMBER OF PERIOD
SHARES, UNITS UNTIL
OR OTHER MATURATION THRESHOLD TARGET MAXIMUM
NAME RIGHTS (#) OR PAYOUT ($ OR #)(II) ($ OR #)(II) ($ OR #)(II)
---- ------------- ----------- ------------ ------------ ------------
<S> <C> <C> <C> <C> <C>
James R. Moffett 100,000(i) 12/31/97 N/A $648,000 N/A
Rene L. Latiolais 75,000(i) 12/31/97 N/A $486,000 N/A
George A. Mealey 40,000(i) 12/31/97 N/A $259,200 N/A
Richard C. Adkerson 40,000(i) 12/31/97 N/A $259,200 N/A
Charles W. Goodyear 40,000(i) 12/31/97 N/A $259,200 N/A
</TABLE>
- ---------
(i) This amount is the number of performance units covered by the performance
award granted in 1994 by the Company to such Named Executive Officer, which
performance units were credited to the performance award account of such
Named Executive Officer. The performance award account of such Named
Executive Officer will be credited, as of December 31 of each year, with an
amount equal to the "Annual Earnings Per Share" (or "Net Loss Per Share")
of the Company's common stock for that year multiplied by the number of
performance units then credited to such performance award account. For
purposes of determining "Annual Earnings Per Share" or "Net Loss Per
Share," the net income or net loss of each majority-owned subsidiary of the
Company that is attributable to equity interests that are not owned by the
Company is included. The Corporate Personnel Committee of the Board of
Directors may, however, in the exercise of its discretion prior to the
making of credits to the performance award accounts of Named Executive
Officers with respect to a particular year, reduce or eliminate the amount
of the "Annual Earnings Per Share" that would otherwise be credited to any
performance award account of any Named Executive Officer for such year. The
balance with respect to performance units in such performance award account
is generally paid as soon as practicable on or after December 31 of the
year in which the third anniversary of the grant of such performance units
occurs.
(ii) There are no "threshold," "target," or "maximum" amounts payable with
respect to long-term incentive plan awards made by the Company. The
amounts set forth in column (e) of this table are representative amounts
based on the adjusted "Annual Earnings Per Share" of the Company's common
stock for 1994, as determined by the Committee. See footnote (i)
immediately above with respect to the determination of "Annual Earnings
Per Share," including adjustments thereto by the Committee.

22
<PAGE>

The following table sets forth the estimated annual benefits payable upon
retirement at the age of 65 under the defined benefit plans of the Company to
an employee hired prior to January 1, 1986, in the compensation and years of
service classifications specified. Such benefits payable to an employee hired
prior to January 1, 1986, are set forth below without parentheses, and such
benefits payable to an employee hired on or after January 1, 1986, are set
forth below within parentheses.

PENSION PLAN TABLE

<TABLE>
<CAPTION>
YEARS OF SERVICE
---------------------------------------------------------------------
REMUNERATION 15 20 25 30 35 40
- ------------ --------- ---------- ---------- ---------- ---------- ----------
<S> <C> <C> <C> <C> <C> <C>
125,000 37,500 50,000 62,500 68,750 75,000 81,250
(30,469) (40,625) (50,781) (60,938) (71,094) (81,250)
150,000 45,000 60,000 75,000 82,500 90,000 97,500
(36,563) (48,750) (60,938) (73,125) (85,313) (97,500)
175,000 52,500 70,000 87,500 96,250 105,000 113,750
(42,656) (56,875) (71,094) (85,313) (99,531) (113,750)
200,000 60,000 80,000 100,000 110,000 120,000 130,000
(48,750) (65,000) (81,250) (97,500) (113,750) (130,000)
225,000 67,500 90,000 112,500 123,750 135,000 146,250
(54,844) (73,125) (91,406) (109,688) (127,969) (146,250)
250,000 75,000 100,000 125,000 137,500 150,000 162,500
(60,938) (81,250) (101,563) (121,875) (142,188) (162,500)
300,000 90,000 120,000 150,000 165,000 180,000 195,000
(73,125) (97,500) (121,875) (146,250) (170,625) (195,000)
400,000 120,000 160,000 200,000 220,000 240,000 260,000
(97,500) (130,000) (162,500) (195,000) (227,500) (260,000)
450,000 135,000 180,000 225,000 247,500 270,000 292,500
(109,688) (146,250) (182,813) (219,375) (255,938) (292,500)
500,000 150,000 200,000 250,000 275,000 300,000 325,000
(121,875) (162,500) (203,125) (243,750) (284,375) (325,000)
1,000,000 300,000 400,000 500,000 550,000 600,000 650,000
(243,750) (325,000) (406,250) (487,500) (568,750) (650,000)
2,000,000 600,000 800,000 1,000,000 1,100,000 1,200,000 1,300,000
(487,500) (650,000) (812,500) (975,000) (1,137,500) (1,300,000)
3,000,000 900,000 1,200,000 1,500,000 1,650,000 1,800,000 1,950,000
(731,250) (975,000) (1,218,750) (1,462,500) (1,706,250) (1,950,000)
4,000,000 1,200,000 1,600,000 2,000,000 2,200,000 2,400,000 2,600,000
(975,000) (1,300,000) (1,625,000) (1,950,000) (2,275,000) (2,600,000)
</TABLE>

23
<PAGE>

Under the defined benefit plans of the Company, each employee who retires on
or after reaching the normal retirement age of sixty-five becomes entitled to a
life annuity in an amount dependent on length of service and "average annual
earnings," offset by a percentage of the employee's covered compensation
multiplied by the number of the employee's years of service, as calculated in
accordance with the Internal Revenue Code of 1986, as amended. "Average annual
earnings" is defined as the average earnings in the three calendar years out of
the last 10 calendar years of employment prior to the employee's retirement or
normal retirement date, whichever occurs first, for which such employee
received the highest earnings. Earnings for this purpose generally include
annual base salary (see "Salary" in the Summary Compensation Table above) for
the year in question plus 50% of bonuses (see "Bonus" in the Summary
Compensation Table above) for such year to the extent not deferred by the
employee. The compensation classifications set forth in the Pension Plan Table
immediately above are "average annual earnings." The length of service of
certain officers and employees includes for these purposes the number of years
such person served with Freeport or McMoRan, respectively.

The respective annual earnings for 1994 only (not "average annual earnings")
covered by the defined benefit plans and arrangements of the Company, which are
based on the amount of the salary for 1994 reported in the Summary Compensation
Table above and 50% of the amount of the bonus for 1994 reported in the Summary
Compensation Table above to the extent not deferred, for the Named Executive
Officers were as follows, with their respective years of credited service under
the defined benefit plans of the Company at December 31, 1994 being shown in
parentheses: Mr. Moffett, $2,824,950 (14 years); Mr. Latiolais, $1,831,950 (30
years); Mr. Mealey, $1,338,250 (19 years); Mr. Adkerson, $1,238,250 (6 years);
Mr. Goodyear, $1,238,250 (6 years). Messrs. Moffett, Latiolais, and Mealey were
hired prior to January 1, 1986, and Messrs. Adkerson and Goodyear were hired
after January 1, 1986.

COMPENSATION COMMITTEE INTERLOCKS AND INSIDER PARTICIPATION

Messrs. Bruce, Cunningham, Harrison, Putnam, Wharton, and Woods
(collectively, the "1994 Corporate Personnel Committee Members") served as the
members of the Corporate Personnel Committee of the Board during 1994. None of
the 1994 Corporate Personnel Committee Members was an officer or employee of
the Company or any of its subsidiaries during 1994 or formerly an officer of
the Company or any of its subsidiaries, and none of the 1994 Corporate
Personnel Committee Members is affiliated with an entity that has or had in
1994 a business relationship with the Company and its subsidiaries required to
be disclosed by the Company in this proxy statement. None of the executive
officers of the Company served during 1994 as a director or as a member of the
compensation committee of another entity (other than a subsidiary or a former
subsidiary of the Company), one of whose executive officers served as a
director or as a member of the Corporate Personnel Committee of the Company.

24
<PAGE>

BOARD COMPENSATION COMMITTEE REPORT ON EXECUTIVE COMPENSATION

The Corporate Personnel Committee is composed of six independent directors,
none of whom are employees of the Company. The Committee met five times in
1994. Specific duties of the Committee include determining the compensation of
the chief executive officer (the "Chief Executive Officer") and senior
executive officers of the Company and administering the annual incentive plan,
the long-term incentive plans, and the stock option plans of the Company.

In addition, the Committee reviews the results of an annual comparison of
Company performance and executive compensation relative to the group of oil,
chemical and mining companies comprising the group of peer issuers (the "Peer
Group") whose cumulative total shareholder return is compared in the
performance graph included in the 1995 proxy statement of the Company. The
review is conducted by an independent executive compensation consultant to help
ensure that overall executive compensation levels track Company performance
relative to the Peer Group. Provided below in the section entitled "Annual Cash
Awards" is a listing of the financial performance factors covered in the annual
comparison of Company performance and executive compensation, and a summary of
the Committee's consideration of these factors in its determination of
executive compensation.

The Committee uses the policies described below as a framework for the
compensation program in which the Company's senior executive officers
participate.

Base Salaries

Base salaries of the executive officers are established at appropriate levels
after consideration of each executive's organizational responsibilities and the
market salaries for similarly situated executive officers in other
organizations. The Company increased base salaries for the executive officers
in 1994 in recognition of significant changes in their responsibilities
following the Company's 1993 organizational restructuring and changes in the
market salaries for similarly situated executive officers. These adjustments
included the first base salary increase for the Chief Executive Officer since
1990. The new salaries appropriately compensate the executive officers compared
to their peers for their superior performance resulting in the Company's
outperforming both the S&P 500 and the Peer Group with respect to cumulative
total return over the last five years.

Annual Cash Awards

The annual incentive plan of the Company is designed to provide incentives,
in the form of annual cash awards, to senior executives whose performance can
have a major impact on the profitability and future growth of the Company.

25
<PAGE>

In 1994, the Stockholders of the Company approved amendments to the annual
incentive plan so as to qualify awards under the plan as performance-based
compensation in compliance with Section 162(m) of the Internal Revenue Code of
1986, as amended (the "Code"), and proposed regulations thereunder and to
maximize the Company's ability to grant awards under the plan to "covered
employees," as defined in Section 162(m) (i.e., the chief executive officer and
the four other highest paid executive officers of the Company for the previous
fiscal year), that will be deductible as compensation. Additionally, the
stockholders amended the annual incentive plan to change the guideline for
determining the maximum aggregate amount of awards made to all participants
under the plan for any calendar year from 1.5% of "Managed Net Income" to 2.5%
of "Net Cash Provided by Operating Activities." The amendments affirmatively
limited the maximum annual aggregate amount of possible awards to "covered
employees" made under the plan to such percentage of "Net Cash Provided by
Operating Activities."

The Committee recommended the change in the guideline for determining maximum
aggregate annual incentive plan awards as discussed above based on the
Committee's assessment of "Net Cash Provided by Operating Activities" to be a
more appropriate measure of the Company's performance which will better link
senior executives' annual incentives to the successful management of the
Company's businesses, and to assure a sufficient annual incentive plan award
pool to appropriately reward "covered employees" for their performance given
the plan's limit on the maximum amount of awards possible to "covered
employees" and considering that the Committee retains negative discretion in
the determination of such awards.

Under the terms of the annual incentive plan, no awards will be made for any
year if the five-year average "Return on Investment" is less than 6%. During
the five-year period ending in 1994, the average "Return on Investment" was
10.4%. When determining the aggregate total of awards granted under the annual
incentive plan for 1994, the Committee considered as a limit the new guideline
of 2.5% of "Net Cash Provided by Operating Activities" for such year.

The performance incentive awards program of the Company is designed to
provide incentives, in the form of annual cash awards, to certain middle
managers and executives who do not participate in the annual incentive plan
described above. In 1994, each participant in the performance incentive awards
program was assigned a target, expressed as a percentage of base salary, which
served as a guideline amount. The combination of base salaries and target
incentive awards is generally designed to achieve total annual cash
compensation substantially equal to 75th percentile Peer Group levels. Actual
performance incentive awards have ranged from zero to a multiple of the target
awards. As a result, the competitive position of total annual cash compensation
for participants in the performance incentive awards program has varied
substantially from year to year depending on performance.

To determine the total amount available for incentive awards in 1994, the
Committee considered certain Company financial performance factors and
operational and strategic accomplishments achieved in 1994. These performance
factors were not individually weighted.

26
<PAGE>

The financial performance factors included the percentage change in "Net Cash
Provided by Operating Activities" over the prior year, the percentage change in
total "Managed Net Income" over the prior year, return on managed equity, and
"Return on Investment." Results of these performance factors for 1994 were
compared to the Company's historical results during each of the last four
fiscal years and to the estimated 1994 results and the actual results during
such four-year period of the Peer Group.

Operational and strategic accomplishments of the Company and its subsidiaries
during 1994 considered by the Committee included: (i) the distribution of the
stock of McMoRan Oil and Gas Co. to Company stockholders; (ii) progress toward
the separation of the (a)copper and gold and (b) agricultural minerals
businesses of the Company into two independent financial and operating
entities; (iii) the execution of an agreement with Pennzoil Sulphur Company to
acquire substantially all of its domestic sulphur assets and business; (iv) the
achievement of profitable operations at the Mine at Main Pass Block 299,
offshore Louisiana in the Gulf of Mexico, despite record low sulphur prices, by
attaining record production levels of an average of 6,200 tons per day and by
stringent cost reduction and enhanced engineering; (v) the successful
completion of the first year of operation of the IMC-Agrico Company joint
venture in excess of target annual cost savings; (vi) the execution of an
agreement in principle with Ercros, S.A. to acquire from it Fertiberia, S.L.,
which operates a nitrogen and phosphate fertilizer business in Spain; (vii) the
increase in average mill throughput at the Indonesian copper and gold mining
and milling production facilities to 72,500 metric tons of ore per day for 1994
as efforts continued ahead of schedule for the expansion of mill throughput to
115,000 metric tons of ore per day; (viii) the expansion of the exploration
effort in Indonesia, and the execution of a contract of work by the Government
of Indonesia; (ix) the completion of a comprehensive copper price protection
program for all sales through 1995 to limit risk; and (x) the establishment of
non-recourse financing facilities for borrowing in the aggregate $290,000,000
and the execution of turnkey engineering and construction contracts for the
expansion by nearly 200% of the smelter operations in Spain of Rio Tinto
Minera, S.A., a subsidiary of the Company.

After reviewing these performance factors, the Committee concluded that
financial results of the Company for 1994 significantly exceeded the Company's
1993 results and exceeded Peer Group medians for all financial performance
factors considered, and that operational and strategic accomplishments exceeded
expectations. Based on its review, the Committee approved an incentive pool for
the annual incentive plan of 1.9% of "Net Cash Provided by Operating
Activities" which is less than the guideline amount provided for under the
plan. 1994 performance awards for those executive officers participating in the
performance incentive awards program generally approximated 150% of their
target awards. Despite the Committee exercising its negative discretion in
determining annual incentive plan awards, aggregate 1994 cash awards approved
by the Committee are significantly greater than those for 1993 in recognition
of the substantial improvement from 1993 for all of the Company's performance
factors as assessed by the Committee.

27
<PAGE>

The aggregate total of awards granted under the annual incentive plan for
1994 was allocated among the "covered employees" as provided under the plan:
32% of the aggregate total was awarded to the Chief Executive Officer, 23% of
the aggregate total was awarded to the Chief Operating Officer, and each of the
remaining three "covered employees" received 15% of the aggregate total,
respectively.

Stock Options and Long-Term Incentives

Stock option and cash long-term incentives award guidelines are intended to
provide a total potential value that is greater than the value of annual cash
compensation to reinforce the importance of shareholder value creation.
Executive officers participate in three long-term incentives: stock options,
freestanding stock appreciation rights ("Freestanding SARs"), and performance
units. Award guidelines for these incentives are expressed as a fixed number of
options, rights, or units, as the case may be, that vary according to the
position level of each participating executive officer. The guidelines were
originally developed by the Committee and confirmed by a competitive review of
compensation practices of the Peer Group conducted by an independent executive
compensation consultant. The total value of long-term incentive awards is
generally intended to produce total compensation based on future performance
that exceeds 75th percentile levels of the Peer Group for the executive
officers. Stock options and Freestanding SARs are emphasized over performance
units.

In 1994, the stockholders of the Company approved amendments to the 1992
long-term performance incentive plan of the Company, under which performance
units are granted, to qualify awards under the Plan as performance-based
compensation in compliance with Section 162(m) of the Code and proposed
regulations thereunder and to maximize the Company's ability to grant awards
under the Plan to "covered employees" that will be deductible as compensation.
The amendments specifically limit the number of performance units to be covered
by any performance award made by the Committee in any year to a "covered
employee."

The Committee encourages executive officers to accumulate significant equity
ownership in the Company by granting stock options. Grants of Freestanding SARs
are also made to provide senior executive officers the means to hold the shares
of Company Common Stock acquired upon their stock option exercises and to add
to their ownership position in the Company. Each Freestanding SAR represents
the right to receive a cash payment equal to the excess of the fair market
value of a share of Company Common Stock on the date of exercise of the
Freestanding SAR over the exercise price of the Freestanding SAR. The exercise
price of a stock option or a Freestanding SAR is equal to the fair market value
of a share of Company Common Stock on the date of grant of such stock option or
Freestanding SAR.

28
<PAGE>

The stock option and Freestanding SAR grants made in 1994 to senior executive
officers were based on the award guidelines described above, and the
Committee's desire to recognize promotions and increased responsibilities. The
number of previously granted stock options was also taken into account by the
Committee when administering the guidelines. To increase the incentive and
retention value of stock option and Freestanding SAR grants, the Committee
decided to make larger, less frequent grants of stock options and Freestanding
SARs to senior executive officers in 1992 instead of smaller, annual grants.
Accordingly, no grants of stock options and Freestanding SARs were made by the
Committee in 1994 to the Chief Executive Officer and certain executive
officers.

The Committee supplements stock option grants to senior executive officers
with annual grants of performance units. In 1994, performance units were
granted to "covered employees" in the amounts specified in the plan: 100,000
performance units were granted to the Chief Executive Officer, 75,000
performance units were granted to the chief operating officer, and 40,000
performance units were granted to each of the remaining "covered employees,"
respectively.

Performance units are designed to link a portion of executive compensation to
cumulative earnings per share because the Company believes that sustained
profit performance will help support increases in shareholder value. Each
performance unit covered by a performance award is annually credited with an
amount equal to the "Annual Earnings Per Share" (or "Net Loss Per Share") of
Company Common Stock until the "Award Valuation Date" for such performance
award, which is generally December 31 of the year in which the third
anniversary of the grant of such performance award occurs. Such credits are
generally paid as soon as practicable after such "Award Valuation Date."

William H. Cunningham, Chairman

Robert W. Bruce III

William B. Harrison, Jr.

George Putnam

J. Taylor Wharton

Ward W. Woods, Jr.

29
<PAGE>

PERFORMANCE GRAPH

The following graph compares the change in the cumulative total shareholder
return on Company Shares with the cumulative total return of the Standard &
Poor's 500 Stock Index and the cumulative total return of a group of peer
issuers during 1990, 1991, 1992, 1993, and 1994.

COMPARISON OF FIVE YEAR CUMULATIVE TOTAL RETURN*
FREEPORT-MCMORAN INC.,
S&P 500 INDEX & PEER GROUP

[GRAPH APPEARS HERE]

<TABLE>
<CAPTION>
1989 1990 1991 1992 1993 1994
<S> <C> <C> <C> <C> <C> <C>
Freeport-McMoRan Inc. $100.00 $116.89 $141.49 $134.24 $163.04 $162.47
S&P 500 $100.00 $ 96.89 $126.42 $136.05 $149.76 $151.74
Peer Group $100.00 $ 89.23 $100.15 $109.43 $120.47 $127.47
</TABLE>

ASSUMES $100 INVESTED ON FREEPORT-MCMORAN INC.
DECEMBER 31, 1989 IN FREEPORT-
McMoRan INC. COMMON STOCK, S&P
500 INDEX & PEER GROUP S&P 500

* TOTAL RETURN ASSUMES PEER GROUP
REINVESTMENT OF DIVIDENDS

30
<PAGE>

On June 30, 1992, the Company distributed to the holders of its Common Stock
all the outstanding shares of common stock of FM Properties Inc. ("FMPO") at
the rate of one share of FMPO common stock for every ten shares of Company
Common Stock. The value of each such share of FMPO common stock on the date of
such distribution was determined by the Company to be equal to $1.75, or $.175
for each Company Share. The performance graph above was prepared under the
assumption that a special dividend of $.175 was paid on each Company Share and
reinvested in Company Shares as of June 30, 1992.

On May 20, 1994, the Company distributed to the holders of its Common Stock
all the outstanding shares of common stock of MOXY at the rate of one share of
MOXY common stock for every ten shares of Company Common Stock. The value of
each such share of MOXY common stock on the date of such distribution was
determined by the Company to be equal to $4.50, or $.45 for each Company Share.
The performance graph above was prepared under the assumption that a special
dividend of $.45 was paid on each Company Share and reinvested in Company
Shares as of May 20, 1994.

The Company distributed to the holders of its Common Stock outstanding on May
16, 1994, August 15, 1994, and November 15, 1994, respectively, FCX Shares at
the rate of one FCX Share for every eighty shares of Company Common Stock
outstanding on each such date. The value of each such distribution on one
Company Share was determined by the Company to be equal to $.375. The
performance graph above was prepared under the assumption that a special
dividend of $.375 was paid on each Company Share and reinvested in Company
Shares as of June 1, 1994, September 1, 1994, and December 1, 1994, which were
the respective payment dates of each such distribution of FCX Shares.

The members of the peer group referred to in the performance graph above are
Air Products & Chemicals Inc., Aluminum Co. of America, Amerada Hess Corp.,
Amoco Corp., Ashland Oil Inc., Burlington Northern Inc., Cyprus Amax Minerals
Company, Dexter Corp., Dow Chemical Company, FMC Corp., Hercules Inc.,
Louisiana Land & Exploration Co., Maxus Energy Corp., Murphy Oil Corp.,
Occidental Petroleum Corp., Olin Corp., Owens Corning Fiberglass Corp.,
Pennzoil Co., PPG Industries Inc., Union Pacific Corp., Unocal Corp., Upjohn
Co., Valero Energy Corp., and The Williams Companies.

RATIFICATION OF AUDITORS

The Board of Directors of the Company seeks ratification by the stockholders
of the Board's appointment of Arthur Andersen LLP to act as the independent
auditors of the financial statements of the Company and its subsidiaries for
the year 1995. The Board has not determined what, if any, action would be taken
should the appointment of Arthur Andersen LLP not be ratified. One or more
representatives of the firm will be available at the Meeting to respond to
appropriate questions, and those representatives will also have an opportunity
to make a statement.

31
<PAGE>

[RECYCLING LOGO APPEARS HERE]
<PAGE>

FREEPORT-MCMORAN INC.
PROXY SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS FOR ANNUAL MEETING OF
STOCKHOLDERS, MAY 2, 1995

The undersigned hereby appoints James R. Moffett, Rene L. Latiolais, and
George A. Mealey as proxies, with full power of substitution, to vote the
shares of the undersigned in Freeport-McMoRan Inc. at the Annual Meeting of
Stockholders to be held on Tuesday, May 2, 1995, at 9:00 a.m., and at any
adjournment thereof, on all matters coming before the meeting. THE PROXIES WILL
VOTE: (1) AS YOU SPECIFY ON THE BACK OF THIS CARD, (2) AS THE BOARD OF
DIRECTORS RECOMMENDS WHERE YOU DO NOT SPECIFY YOUR VOTE ON A MATTER LISTED ON
THE BACK OF THIS CARD, AND (3) AS THE PROXIES DECIDE ON ANY OTHER MATTER.

DATED ___________________________________, 1995

_______________________________________________

_______________________________________________
(SIGNATURE)

IF YOU WISH TO VOTE ON ALL MATTERS AS THE
BOARD OF DIRECTORS RECOMMENDS, PLEASE SIGN,
DATE AND RETURN THIS CARD. IF YOU WISH TO VOTE
ON ITEMS INDIVIDUALLY, PLEASE ALSO MARK THE
APPROPRIATE BOXES ON THE BACK OF THIS CARD.

PLEASE MARK, SIGN, DATE AND RETURN THIS PROXY PROMPTLY IN THE ENCLOSED ENVELOPE

(CONTINUED FROM OTHER SIDE)

The Board of Directors recommends a vote FOR:

1. Election of the nominees for directors. Nominees for directors of
Freeport-McMoRan Inc.
[_] FOR[_] WITHHELD Gabrielle K. McDonald
[_] FOR, EXCEPT WITHHELD FROM: James R. Moffett
George Putnam
B.M. Rankin, Jr.

------------------------------------
2. Ratification of appointment of Arthur Andersen LLP as independent auditors.
[_] FOR[_] AGAINST[_] ABSTAIN
- --------------------------------------------------------------------------------
You may specify your votes by marking the appropriate boxes on this side. You
need not mark any boxes, however, if you wish to vote all items in accordance
with the Board of Directors' recommendation. IF YOUR VOTES ARE NOT SPECIFIED,
THIS PROXY WILL BE VOTED FOR THE ELECTION OF THE NOMINEES FOR DIRECTORS AND FOR
PROPOSAL 2.

PLEASE SIGN AND DATE ON OTHER SIDE