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Item 1.01.
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Entry into a Material Definitive Agreement
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On August 15, 2019, Freeport-McMoRan Inc., a Delaware corporation (FCX), as issuer, and Freeport-McMoRan Oil & Gas LLC, a Delaware limited liability company, as guarantor (Guarantor), completed the sale of its previously announced $600 million aggregate principal amount of 5.00% Senior Notes due 2027 (the 2027 Senior Notes) and $600 million aggregate principal amount of 5.25% Senior Notes due 2029 (the 2029 Senior Notes and, together with the 2027 Senior Notes, the Notes). The Notes are guaranteed by the Guarantor (the Guarantees and, together with the Notes, the Securities). The Securities are FCX’s and the Guarantor’s senior unsecured obligations and will rank senior in right of payment to any subordinated indebtedness that FCX or the Guarantor may incur in the future and equally in right of payment with all of FCX’s and the Guarantor’s existing and future unsecured and unsubordinated indebtedness.
The Securities were offered pursuant to a prospectus supplement dated August 1, 2019, to the prospectus dated August 1, 2019, that forms a part of FCX’s effective Registration Statement on Form
S-3,
as amended (File No.
333-226675),
filed by FCX with the Securities and Exchange Commission under the Securities Act of 1933, as amended.
The Notes were issued pursuant to an Indenture dated as of August 15, 2019 (the Base Indenture), between FCX and U.S. Bank National Association, as trustee (the Trustee), as supplemented by the first supplemental indenture and the second supplemental indenture, each dated as of August 15, 2019, among FCX, the Guarantor and the Trustee (the Supplemental Indentures and together with the Base Indenture, the Indenture).
The 2027 Senior Notes will mature on September 1, 2027, and the 2029 Senior Notes will mature on September 1, 2029. Interest will accrue at a rate of 5.00% per annum for the 2027 Senior Notes and 5.25% per annum for the 2029 Senior Notes, in each case, from August 15, 2019. Interest on the 2027 Senior Notes and the 2029 Senior Notes is payable on September 1 and March 1 of each year, commencing March 1, 2020. FCX may redeem some or all of the Notes at any time and from time to time at the redemption prices set forth in the Indenture, as applicable.
The Indenture contains covenants that restrict FCX’s ability, with certain exceptions, to (i) incur debt secured by liens, (ii) engage in sale and leaseback transactions and (iii) merge or consolidate with or into another entity, or sell, transfer or lease all or substantially all of its properties and assets. These covenants are subject to a number of important exceptions and qualifications, as described in the Indenture.
In the ordinary course of their businesses, affiliates of the Trustee have engaged in commercial banking transactions with FCX and its subsidiaries, and may in the future engage in commercial banking and other transactions with FCX and its subsidiaries.
The foregoing descriptions of the Indenture and the Securities are not intended to be complete and are qualified in their entirety by reference to the Indenture and the forms of the Notes, copies of which are attached as Exhibits 4.1, 4.2, 4.3, 4.4 and 4.5 to this Current Report on Form
8-K
and each of which is incorporated by reference herein.