EXECUTION COPY
EXHIBIT 2
FIRST AMENDMENT TO
SEPARATION AGREEMENT
This FIRST AMENDMENT TO SEPARATION AGREEMENT, dated as of July 1, 2002
(this "First Amendment"), by and between Pharmacia Corporation, a Delaware
corporation ("Pharmacia"), and Monsanto Company, a Delaware corporation
("Monsanto").
W I T N E S S E T H:
WHEREAS, Pharmacia (formerly known as Monsanto Company ("Former
Monsanto")) and Solutia, Inc., a Delaware corporation ("Solutia"), are parties
to that certain Distribution Agreement, dated as of September 1, 1997 (the
"Distribution Agreement"), which was entered into in connection with the
distribution of the common stock of Solutia to the stockholders of Former
Monsanto (the "Solutia Distribution");
WHEREAS, pursuant to the Distribution Agreement, among other things,
Former Monsanto assigned and transferred certain assets related to its chemicals
businesses to Solutia and Solutia assumed all of the liabilities related to the
chemicals businesses of Former Monsanto;
WHEREAS, pursuant to that certain Agreement and Plan of Merger, dated
as of December 19, 1999, by and among Former Monsanto, MP Sub, Incorporated
("Merger Sub") and Pharmacia & Upjohn, Inc. ("PNU"), the parties agreed that
Merger Sub would be merged with and into PNU with PNU surviving as a wholly
owned subsidiary of Former Monsanto in the merger (the "Merger");
WHEREAS, on February 9, 2000, the new Monsanto was incorporated as a
wholly owned subsidiary of Former Monsanto under the name "Monsanto Ag Company;"
WHEREAS, on March 31, 2000, (i) the Merger was effective, (ii) Former
Monsanto changed its name from "Monsanto Company" to "Pharmacia Corporation,"
and (iii) Monsanto changed its name from "Monsanto Ag Company" to "Monsanto
Company;"
WHEREAS, on September 1, 2000, Pharmacia and Monsanto entered into
certain agreements, including that certain Separation Agreement, dated as of
September 1, 2000 (the "Separation Agreement"), pursuant to which, among other
things, Pharmacia assigned and transferred the Monsanto Assets (as defined in
the Separation Agreement) to Monsanto and Monsanto assumed the Monsanto
Liabilities (as defined in the Separation Agreement), including all liabilities
that were assumed by Solutia or any of its subsidiaries in connection with the
Solutia Distribution to the extent that Solutia fails to pay, perform or
discharge such liabilities;
WHEREAS, on or about October 23, 2000, Monsanto completed an initial
public offering of its common stock in which Monsanto sold approximately 15% of
its issued and outstanding shares of common stock to the public;
WHEREAS, Pharmacia currently owns approximately 84% of the issued and
outstanding shares of common stock of Monsanto;
WHEREAS, Pharmacia has announced its intention to distribute its entire
ownership interest in Monsanto to the stockholders of Pharmacia or could take
some other action that will result in Pharmacia no longer controlling Monsanto
(a "Possible Disposition");
WHEREAS, Pharmacia, Solutia and Monsanto have entered into an Amendment
to Distribution Agreement, dated as of July 1, 2002, pursuant to which, among
other things, the parties thereto have amended the Distribution Agreement in
light of the Possible Disposition in order to preserve the relationship among
the parties as nearly as possible with the original intent and purpose of the
Distribution Agreement; and
WHEREAS, Pharmacia and Monsanto each desires to amend the Separation
Agreement in light of the Amendment to Distribution Agreement and to further
clarify in certain respects the relationship between the parties, all in
accordance with the provisions of this First Amendment.
NOW, THEREFORE, in consideration of the premises and the mutual
covenants herein contained and intending to be legally bound hereby, the parties
hereto agree as follows:
Section 1. Each capitalized term used in this First Amendment and not
otherwise defined herein shall have the meaning ascribed thereto in the
Separation Agreement, as amended hereby.
Section 2. The parties hereto hereby agree that effective as of the
date of this First Amendment the Separation Agreement is hereby amended as
follows:
(a) Section 1.01 of the Separation Agreement is hereby amended by
adding the following definitions.
"Distribution Agreement: that certain Distribution Agreement,
dated as of September 1, 1997, between Pharmacia (formerly
known as Monsanto Company) and Solutia, as amended by that
certain Distribution Agreement, Amendment."
"Distribution Agreement Amendment: that certain Amendment to
Distribution Agreement, dated as of July 1, 2002, among
Pharmacia, Solutia and Monsanto."
(b) The definition of "Former Agricultural Business" in Section 1.01 of
the Separation Agreement is hereby amended by inserting the following language
at the end of Schedule F-1 under the heading "Other Former Businesses":
"34. discontinued herbicides, including, without limitation,
2, 4-D (2,4 dichlorophenoxyacetic acid) and 2, 4, 5-T (2, 4, 5
trichlorophenoxyacetic acid)."
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(c) The definition of "Insured Monsanto Claim" in Section 1.01 of the
Separation Agreement is hereby amended by inserting the word "injury,"
immediately before each use of the word "Loss", and inserting the words "or
asserted to have been incurred" after the word "incurred" on the second line.
(d) The definition of "Monsanto Liabilities" in Section 1.01 of the
Separation Agreement is hereby amended by inserting the following language at
the end of clause (5) thereof immediately after the words "Schedule M-6" and
immediately before the words "and, subject to the terms of Article IX" as
follows:
"provided that Monsanto Liabilities shall not include and
Monsanto shall not assume any Liabilities for environmental
remediation or other environmental responsibilities which are
not primarily related to the Monsanto Business or any Former
Agriculture Business arising directly or indirectly at or
from the sites listed on Schedule M-6 (e.g. without
limitation, the Marzone site)."
(e) The definition of "Monsanto Liabilities" in Section 1.01 of the
Separation Agreement is hereby amended by inserting the following language at
the end of clause (9) thereof immediately after the words "such Liabilities" and
immediately before the semi-colon:
", including Solutia's commitments and obligations under the
Distribution Agreement (including Solutia's obligation to
indemnify, defend and hold harmless each member of the
Monsanto Group (as defined in the Distribution Agreement)),
in each case when any such Liability is due or required to be
paid, performed or discharged by any member of the Pharmacia
Group without requirement that any demand, right, action or
remedy be made, initiated, pursued or obtained against
Solutia or any judgment be obtained or enforced against
Solutia (such Liabilities described in this clause (9) being
referred to collectively as the "Solutia Liabilities")."
(f) Clause (2)(i) of Section 3.03(b) of the Separation Agreement is
hereby amended to read in its entirety as follows:
"(i) relating to or arising out of or due to the failure to
pay, perform or discharge in due course the Monsanto
Liabilities by any member of the Monsanto Group who has an
obligation with respect thereto; provided, however, that in
the case of any Solutia Liability, the phrase "in due course"
shall mean when due or required to be paid, performed or
discharged by any member of the Monsanto Group (as defined in
the Distribution Agreement) without requirement that any
demand, right, action or remedy be made, initiated, pursued
or obtained against Solutia or any judgment be obtained or
enforced against Solutia."
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(g) The first Sentence of Section 3.03(d) of the Separation Agreement
is hereby amended to read in its entirety as follows:
"(d) On and following the Separation Date Monsanto shall
assume (or shall cause one of its wholly-owned Subsidiaries
to assume) (i) the prosecution of all claims which are
Monsanto Assets and are pending on the Separation Date; (ii)
the defense against all Third Party Claims which are Monsanto
Liabilities and are pending on the Separation Date or which
are made or asserted at any time between the Separation Date
and the first date that Pharmacia beneficially owns less than
50.1% of the issued and outstanding voting stock of Monsanto;
and (iii) the defense of all claims, including Third Party
Claims, whenever arising, that are Solutia Liabilities in the
event that Solutia elects not to defend any such claim under
the Distribution Agreement or Solutia, after electing to so
defend, for any reason fails to defend any Solutia Liability
(or breaches its commitment or obligation under the
Distribution Agreement to defend), subject to the rights and
obligations of the respective parties under the Distribution
Agreement, but provided that Monsanto shall promptly take all
commercially reasonable actions, (including invoking the
dispute resolution provision of the Distribution Agreement,
as appropriate) to take control of the defense of such claims
from Solutia or to otherwise enforce Monsanto's rights under
the Distribution Agreement."
(h) Section 3.04 of the Separation Agreement is hereby amended by
adding the following Section 3.04(g) immediately following Section 3.04(f) of
the Separation Agreement:
"(g) The parties hereto acknowledge and agree that due to the
fact that (i) each of Pharmacia and Monsanto are parties to
the Distribution Agreement and therefore each have indemnity
and certain other rights against Solutia and certain
obligations to Solutia with respect to the Solutia
Liabilities, (ii) Pharmacia has appointed Monsanto as
Pharmacia's agent and attorney for all purposes with respect
to Pharmacia's rights and obligations under the Distribution
Agreement, including any rights and obligations Pharmacia has
under the indemnity provisions thereof (and Monsanto has
accepted such appointment), and (iii) Monsanto has assumed or
undertaken certain obligations with respect to the Solutia
Liabilities pursuant to the terms of this Agreement, the
parties hereto agree that notwithstanding anything to the
contrary contained in this Agreement, including this Section
3.04, the procedure for assumption or indemnification with
respect to any Solutia Liability shall be as follows:
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(A) Any claim with respect to the Solutia Liabilities shall
be treated for all purposes of Section 3.04 as a Third Party
Claim and the provisions of Section 3.04, as modified hereby
shall apply;
(B) Notwithstanding Section 3.04(a), Monsanto shall be deemed
to have actual notice of (i) any Third Party Claim pending on
the date hereof which is or becomes a Solutia Liability for
which Monsanto has actual or constructive notice and (ii) any
claim (including any Third Party Claim) with respect to any
matter or Loss or Indemnifiable Loss relating to a Solutia
Liability under Article III (each, a "Solutia Liability
Claim") for which any indemnitee under the Distribution
Agreement has given Monsanto written notice (as Pharmacia's
attorney and agent with respect to the Distribution Agreement
or otherwise) and no Indemnitee shall be required to provide
any other notice to Monsanto pursuant to Section 3.04(a) or
Section 3.04(f);
(C) Sections 3.04(c), (d) and (e) shall apply, except that,
subject to the respective rights and obligations of the
parties under the Distribution Agreement, Monsanto shall, at
Monsanto's own expense and through counsel chosen by Monsanto
(which counsel shall be reasonably satisfactory to the
Indemnitee), be obligated to defend any Solutia Liability
Claim; and
(D) Section 3.04(f) shall not apply; however, if any member
of the Indemnifying Party's Group fails to pay, perform or
discharge its respective obligations arising out of Section
3.03 with respect to any Solutia Liability when due or
required to be paid, performed or discharged, any Indemnitee
shall be free to pursue such remedies as may be available to
such party under Article VI of this Agreement.
(i) Schedule M-3 to the Separation Agreement is hereby deleted in its
entirety and replaced with the Amended and Restated Schedule M-3 attached
hereto.
(j) Schedule M-8 to the Separation Agreement is hereby deleted in its
entirety and replaced with the Amended and Restated Schedule M-8 attached
hereto.
Section 3. Monsanto shall, upon reasonable request from Pharmacia, (i)
provide to Pharmacia such information as Pharmacia shall reasonably request
regarding any Monsanto Liabilities (including Solutia Liabilities) and any
actions, claims, proceedings, litigation or investigations ("Proceedings")
relating thereto and (ii) consult and confer with Pharmacia regarding (A) all
aspects of the Distribution Agreement and their respective rights and
obligations thereunder (B) the status of any Proceedings relating to any
Monsanto Liabilities (including Solutia Liabilities) and the strategies,
possible outcomes and any settlement proposals or negotiations relating thereto,
and (C) any indemnity obligations with respect to any Proceeding (including any
defense thereof) whether such obligation is a Solutia obligation
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pursuant to the Distribution Agreement or a Monsanto obligation pursuant to the
Separation Agreement. Notwithstanding the foregoing, neither Monsanto nor any
legal counsel to Monsanto shall be required to disclose any information that, if
disclosed to Pharmacia, would waive Monsanto's right to claim attorney-client
privilege with respect to such information; provided, however, each party shall
cooperate and take such actions (including entering into such agreements) as are
reasonable in the circumstances in order to permit such information to be
provided to Pharmacia without waiving such privilege.
Section 4. Except as expressly modified and amended hereby, the
Separation Agreement shall continue to be and shall remain in full force and
effect in accordance with its terms. If there is any conflict between the terms
of the Separation Agreement, as amended, and the terms of the Protocol
Agreement, dated as of July 1, 2002 by and among Pharmacia, Monsanto and Solutia
(the "Protocol Agreement"), the terms of the Protocol Agreement shall govern.
Section 5. Except as may otherwise be agreed by the parties, each party
hereto will pay all costs and expenses incident to its negotiation and
preparation of this First Amendment, including the fees, expenses and
disbursement of its counsel.
Section 6. This First Amendment shall be governed by and construed in
accordance with the laws of the State of Delaware (other than the laws regarding
choice of laws and conflicts of laws) as to all matters, including matters of
validity, construction, effect, performance and remedies.
Section 7. This First Amendment may be amended, modified or
supplemented only by a written agreement signed by all of the parties hereto.
Section 8. This First Amendment and all of the provisions hereof shall
be binding upon and inure to the benefit of the parties hereto and their
successors and permitted assigns, but neither this First Amendment nor any of
the rights, interests and obligations hereunder shall be assigned by any party
hereto without the prior written consent of the other party (which consent shall
not be unreasonably withheld or delayed).
Section 9. This First Amendment may be executed in two or more
counterparts, each of which shall be deemed an original, but all of which
together shall constitute one and the same instrument.
Section 10. Any provision of this First Amendment which is prohibited
or unenforceable in any jurisdiction shall, as to such jurisdiction, be
ineffective to the extent of such prohibition or unenforceability without
invalidating the remaining provisions hereof. Any such prohibition or
unenforceability in any jurisdiction shall not invalidate or render
unenforceable such provision in any other jurisdiction. Each party acknowledges
that money damages would be an inadequate remedy for any breach of the
provisions of this First Amendment and agrees that the obligations of the
parties hereunder shall be specifically enforceable.
[SIGNATURE PAGE IS NEXT PAGE]
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IN WITNESS WHEREOF, the parties hereto have caused this First Amendment
to be duly executed as of the date first above written.
PHARMACIA CORPORATION,
a Delaware corporation
By: // Xxxxxxx X. Xxxxxxx
---------------------------------
Name: Xxxxxxx X. Xxxxxxx
Title: Senior Vice President and
General Counsel
MONSANTO COMPANY,
a Delaware corporation
By: // Xxxxxxx X. Xxxxxxxxxx
---------------------------------
Name: Xxxxxxx X. Xxxxxxxxxx
Title: Chairman and CEO
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FIRST AMENDMENT TO
SEPARATION AGREEMENT
BY AND BETWEEN
PHARMACIA CORPORATION
AND MONSANTO COMPANY
DATED AS OF JULY 1, 2002
AMENDED AND RESTATED
SCHEDULE M-3
MONSANTO ASSETS
Partnerships, Joint Ventures and Other Equity Interests
Anhui an Dai Cotton Seed Technology Company Ltd.
Biotage UK Limited
CDM Mandiyu SRL
D&M Brasil Algodao Ltda.
D&M International LLC
D&M Partners
D&PL China Pte Ltd.
Dnepr
Ecogen, Inc.
Feed Additive Joint Venture with Cultur
GeneTrace Systems, Inc.
Limagrain Canada Seeds
Maharashtra Hybrid Seed Co.
Mendel Biotechnology
Moviagro Technologia Agricola SA
Renessen LLC
Seed Company of Zinjiang AIC Corp.
Shaanxi Province Seed Group Corporation
Zooagro de Venezuela C.A.
Civic Ventures Investment Fund X.X.
Xxxx-X
FIRST AMENDMENT TO
SEPARATION AGREEMENT
BY AND BETWEEN
PHARMACIA CORPORATION
AND MONSANTO COMPANY
DATED AS OF JULY 1, 2002
AMENDED AND RESTATED
SCHEDULE M-8
MONSANTO SUBSIDIARIES
ENTITY
Agroseed Corp.
Asgrow Seed Company LLC
Bejing New Millennium Fengrui Crop Science
Bretco Holdings (Mauritius) Ltd.
Calgene LLC
Centrogen Holdings Pty. Ltd.
Cereon Genomics LLC
Charoen Seeds Company Ltd.
Chemstrand Overseas S.A.
Commercializadora Sehisa SA
Corn States Hybrid Service LLC
Corporacion Agraria S.L.
Coseven LLC
Danagri APS
Dekalb Genetics Corporation
Holden's Foundation Seeds LLC
Hope Properties LLC
Hybritech SNC
Lan Invest
Lexphc Inc.
Mallard Rice, LLC
MonGard Ltd.
Monsanto Holdings Ltd.
Monsanto (Shanghai) Company Ltd.
Monsanto Ag Products LLC
Monsanto Ag Technologies, LLC
Monsanto Agrar Deutschland GmbH
Monsanto Agricola Honduras SA
Monsanto Agricoltura Italia S.p.A.
Monsanto Agricultura Espana, SA
Monsanto Argentina S.A.I.C.
Monsanto Bangladesh Ltd.
Monsanto Bolivia S.A.
Monsanto C.R. sro
Monsanto Canada, Inc.
Monsanto Canada Seeds, Inc.
Monsanto Caribe LLC
Monsanto Central Africa Inc.
Monsanto Centroamerica (El Salvador) SA
Monsanto India Ltd.
Monsanto Chile Com. E Indus. Ltda.
Monsanto Colombiana Inc.
Monsanto Comercial SA de CV
Monsanto Crop Sciences Denmark SA
Monsanto Ireland Ltd.
Monsanto Crop Sciences Netherland B.V.
Monsanto Crop Sciences NorwayA/S
Monsanto Crop Sciences SwedenAB
Monsanto de Costa Rica SA
Monsanto Dominicana Inc.
Monsanto Ecutoriana SA
Monsanto Enviro-Chem Systems, Inc.
Monsanto Europe SA
Monsanto Far East Ltd.
Monsanto Finance AG
Monsanto Gida ve Tarim Ticaret Limited Sirketi
Monsanto Guatemala Inc.
Monsanto Hellas EPE
Monsanto Holdings Ltd.
Monsanto II-Productos Quimicos e Agricolas, Sociedad Unipessoal Lda.
Monsanto Imperial Chem. Indus. Am. Inc.
Monsanto India Private Limited
Monsanto Interamerica Inc.
Monsanto International Sales Co. Inc.
Monsanto Invest NV.
Monsanto Japan Ltd.
Monsanto Kenya Ltd.
Monsanto Kereskedelmi (Trading) KFT
Monsanto Korea, Inc.
Monsanto Ltd.
Monsanto Mauritius Ltd.
Monsanto New Zealand Ltd.
Monsanto Overseas SA
Monsanto Oy
Monsanto Pakistan AgriTech (Pvt) Ltd.
Monsanto Paraguay S.A.
Monsanto Participacoes Ltda
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Monsanto Philippines, Inc.
Monsanto Polska SP Z.OO
Monsanto Produccion y Servios SA de CV
Monsanto Research Corp
Monsanto Romania X.X.
Xxxxxxxx Xxxxxx XXX
Xxxxxxxx Xxxxxxx Ltd.
Monsanto Services International S.A./N.V.
Monsanto Slovakia s.r.o.
Monsanto South Africa (Pty) Ltd.
Monsanto Tanzania Ltd.
Monsanto Technologies LLC
Monsanto Thailand Ltd.
Monsanto U.K. Ltd.
Monsanto Ukraine Ltd.
Monsanto Venezuela CA
Monsanto West Africa, Inc.
MonSoy S.A.
MonSure Ltd.
Nidus Center for Scientific Enterprise
Olympia Industries Inc.
P.T. Branita Sandhini
P.T. Monagro Kimia
P4 Production LLC
Renfield S.A.
Semillas Hibridas S.A. de C.V.
Semillas Monsanto SA de CV
Sensako Ltd.
Vigortech Inc.
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