Freeport-McMoRan offers cash incentive to convert 8¼% notes

New York, Dec. 8 - Freeport-McMoRan Copper & Gold Inc. said it is offering a cash incentive to encourage conversion of its 8¼% convertible senior notes due 2006.

The New Orleans copper, gold and silver miner will pay $20 plus accrued interest through the conversion date per $1,000 principal amount of the notes that are converted by Jan. 6.

The notes are currently convertible at a price of $14.30 per share. Freeport stock closed at $45.26 Friday.

Freeport has $292.6 million of the convertibles outstanding. It added that it intends to redeem any notes that remain outstanding when they become convertible on July 31, 2004.

The company has already reduced the amount of the convertibles from the original $603.75 million through privately negotiated transactions in August.

If all notes are converted under the offer, Freeport will pay $16 million, to be funded from the escrow set up to pay the first three years' interest on the notes.

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