1
Exhibit 2
DISTRIBUTION AGREEMENT
BY AND BETWEEN
MONSANTO COMPANY,
A DELAWARE CORPORATION,
AND
[NEW CHEMICALS CORPORATION,]
A DELAWARE CORPORATION
As of ____________, 1997
2
DISTRIBUTION AGREEMENT
DISTRIBUTION AGREEMENT, dated as of _________ __, 1997 (this
"Agreement"), by and between Monsanto Company, a Delaware corporation
("Monsanto"), and [New Chemicals Corporation], a newly formed Delaware
corporation ("Chemicals").
W I T N E S S E T H:
WHEREAS, the Board of Directors of Monsanto has determined
that it is appropriate and desirable to separate Monsanto and its subsidiaries
into two publicly traded organizations by: (1) consolidating into Chemicals and
its newly formed subsidiaries certain of the businesses currently conducted by
Monsanto directly and through certain of its other subsidiaries and (2)
distributing to the holders of the issued and outstanding shares of common
stock, par value $2.00 per share, of Monsanto all of the issued and outstanding
shares of common stock, par value $.01 per share, of Chemicals in accordance
with Article III hereof (the "Distribution");
WHEREAS, the Distribution is intended to qualify as a tax-free
spinoff under Section 355 of the Internal Revenue Code of 1986, as amended;
WHEREAS, the parties hereto have determined that it is
necessary and desirable to set forth the principal corporate transactions
required to effect the Distribution and to set forth other agreements that will
govern certain other matters prior to and following such Distribution;
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:
ARTICLE I
DEFINITIONS
1.01 GENERAL. As used in this Agreement, the following terms
shall have the following meanings (such meanings to be equally applicable to
both the singular and plural forms of the terms defined):
1. ACTION: any demand, action, suit, countersuit, arbitration,
inquiry, proceeding or investigation by or before any federal, state,
local, foreign or international Governmental Authority or any
arbitration or mediation tribunal.
2. AFFILIATE: with respect to any specified Person, a Person
that directly, or indirectly through one or more intermediaries,
controls, is controlled by, or is under common control with, such
specified Person; provided, however, that for purposes of this
Agreement, no member of either Group shall be deemed to be an Affiliate
of any member of the other Group.
3. AGENT: the distribution agent appointed by Monsanto to
distribute the shares of Chemicals Common Stock pursuant to the
Distribution.
-2-
3
4. ARBITRATION ACT: the United States Arbitration Act, 9
U.S.C. Sections 1-14, as the same may be amended from time to time.
5. ARBITRATION DEMAND DATE: as defined in Section 7.03(a)
hereof.
6. ARBITRATION DEMAND NOTICE: as defined in Section 7.03(a)
hereof.
7. ASSETS: any and all assets, properties and rights
(including goodwill), wherever located (including in the possession of
vendors or other third parties or elsewhere), whether real, personal or
mixed, tangible, intangible or contingent, in each case whether or not
recorded or reflected or required to be recorded or reflected on the
books and records or financial statements of any Person, including,
without limitation, the following:
(i) all accounting and other books, records and
files whether in paper, microfilm, microfiche, computer tape
or disc, magnetic tape or any other form;
(ii) all apparatus, computers and other electronic
data processing equipment, fixtures, trade fixtures,
machinery, equipment, capital and other spares, furniture,
office equipment, automobiles, trucks, aircraft, rolling
stock, vessels, motor vehicles, trailers and other
transportation equipment, special and general tools, test
devices, prototypes and models and any other tangible personal
property;
(iii) all inventories of materials, raw materials,
catalysts, precious metals, stores inventories, supplies,
work-in-process, consigned goods and finished goods and
products and product samples;
(iv) all interests in real property of whatever
nature, including easements, leases and licenses, whether as
owner, mortgagee or holder of a Security Interest in real
property, lessor, sublessor, lessee, sublessee or otherwise;
(v) all buildings and other improvements to real
property and all leasehold improvements;
(vi) all bonds, notes, debentures or other
securities issued by any Subsidiary or any other Person, all
loans, advances or other extensions of credit or capital
contributions to any Subsidiary or any other Person, all
certificates of deposit, bankers' acceptances, certificates of
interest or participation in profit sharing agreements,
collateral trust certificates, preorganization certificates or
subscriptions, transferable shares, investment contracts,
voting trust certificates, fractional undivided interests in
oil, gas or other mineral rights, puts, calls, straddles,
options and other securities of any kind;
(vii) all license agreements, leases of personal
property and other leases, open purchase orders for raw
materials, supplies, parts or services, unfilled orders for
the manufacture or sale of products, other sales or purchase
agreements, other commitments or arrangements, permits,
distribution arrangements, and other contracts, agreements or
commitments;
(viii) all deposits, letters of credit and
performance and surety bonds;
(ix) all technical information, data,
specifications, research and development information,
engineering drawings, operating and maintenance
-3-
4
manuals, and materials and analyses prepared by consultants
and other third parties; environmental clean-up technology,
safety and industrial hygiene methods and technology;
(x) all technology, domestic and foreign patents,
statutory, common law and registered copyrights, trade names,
registered and unregistered trademarks, service marks, service
names, trade styles, product bar codes and associated
goodwill, and registrations and applications for any of the
foregoing, mask works, trade secrets, inventions, formulas,
processes, designs, know-how, or other data or information,
confidential information, other proprietary information and
licenses from third Persons granting the right to use any of
the foregoing and other rights in, to and under the foregoing
(it being understood that the transfer of Assets described in
this clause (x) shall be made pursuant to the Intellectual
Property Agreements);
(xi) all computer applications, programs and other
software and databases (including all embodiments or fixations
thereof and related documentation, registrations and
franchises, and all additions, improvements, enhancements,
updates and accessions thereto), all technical manuals and
documentation made in connection with the foregoing, and the
right to xxx for past infringement thereof, and all licenses
and rights with respect to the foregoing or of like nature,
including operating software, network software, firmware,
middleware, design software, design tools, systems
documentation and instructions;
(xii) all cost information, sales and pricing data,
customer prospect lists, supplier records, customer and
supplier lists, customer and vendor data, correspondence and
lists, product literature, artwork, design, development and
manufacturing files, vendor and customer drawings,
formulations and specifications, quality records and reports,
lists of advertisers, records pertaining to advertisers and
accounts, and other books, records, studies, surveys, reports,
plans and document forms and any other business information;
(xiii) all prepayments or prepaid expenses, trade
accounts and other accounts and notes receivable and all other
current assets;
(xiv) the right to receive mail, payments on
accounts receivable and other communications;
(xv) all rights under contracts, agreements,
warranties or guaranties, all claims or rights or judgments
against any Person, all rights in connection with any bids or
offers and all claims, choses in action, rights of recovery
and rights of set-off or similar rights, whether accrued or
contingent, refunds and deposits;
(xvi) all rights under insurance policies and all
rights in the nature of insurance, indemnification or
contribution;
(xvii) all licenses, permits, approvals and
authorizations which have been issued by any Governmental
Authority;
(xviii) advertising materials and other printed or
written materials;
-4-
5
(xix) employee contracts, including any rights
thereunder to restrict an employee or former employee from
competing in certain respects, and personnel and medical files
and records;
(xx) cash, cash equivalents, bank accounts, lock
boxes and other deposit arrangements; and
(xxi) interest rate, currency, commodity or other
swap, collar, cap, floor, or other hedging or similar
agreements or arrangements.
8. BUSINESS TRANSFER AGREEMENTS: the agreements which have
been or will be entered into between certain wholly-owned Chemicals
Subsidiaries incorporated, or having a branch or presence outside the
United States and certain wholly-owned Monsanto Subsidiaries
incorporated, or having a branch or presence outside the United States,
providing for the transfer of Chemicals Assets and assumption of
Chemicals Liabilities outside the United States from such Monsanto
Subsidiaries to such Chemicals Subsidiaries. For purposes hereof, the
term Business Transfer Agreement shall also include: (i) any other
agreements related to the transfer of Chemicals Assets and assumption
of Chemicals Liabilities outside the United States, including without
limitation, those agreements which are required by local law or are
executed in connection with or to implement such transfer of Chemicals
Assets and assumption of Chemicals Liabilities; and (ii) the assignment
from Monsanto to Chemicals transferring the operating assets in the
United States.
9. BUSINESS DAY: any day other than a Saturday, a Sunday or a
day on which banking institutions located in the States of Missouri,
New York or Delaware are authorized or obligated by law or executive
order to close.
10. CHEMICALS: as defined in the preamble to this Agreement.
11. CHEMICALS ASSETS: excluding the Excluded Chemicals Assets,
and any Assets sold or otherwise disposed of on or prior to the
Distribution Date (1) all Assets included on the Chemicals Balance
Sheet or the accounting records supporting the Chemicals Balance Sheet,
as adjusted by the pro forma adjustments thereto as set forth in the
Proxy Statement and all Assets of either Group acquired between March
31, 1997 and the Distribution Date which would have been included on
the Chemicals Balance Sheet had they been owned on March 31, 1997; (2)
all Assets exclusively dedicated to the Chemicals Business and all
Assets formerly used in the Former Chemicals Business which are not
used in the Monsanto Business on the Distribution Date, which in either
case, are owned, leased, licensed or held by any member of either Group
on the Distribution Date; (3) real property (including the buildings,
fixtures and improvements located thereon) listed on Schedule ________
and such other real property interests held by members of either Group
formerly used in any Former Chemicals Business which are not used in
the Monsanto Business on the Distribution Date; (4) all of the
outstanding shares of all classes of capital stock of the Chemicals
Subsidiaries to the extent owned by any member of the Monsanto Group;
(5) the partnership, joint venture and other equity interests listed on
Schedule _________, and Chemicals' rights with respect to and interests
in the P4 Joint Venture as provided in the P4 Joint Venture Agreement;
(6) all contracts, leases and licenses exclusively dedicated to the
Chemicals Business, and such rights under other contracts, leases or
licenses as the parties have otherwise agreed pursuant to this
Agreement, the Other Agreements or in any other enforceable agreement
executed on behalf of a member of the Chemicals Group, on the one hand,
and a member of the Monsanto Group, on the other hand; (7) warranties,
guarantees, claims or any other rights that members of either Group
-5-
6
may have against any Third Party (including Governmental Authorities)
to the extent relating to the disposition of any Former Chemicals
Business; (8) those books and records to be delivered to the Chemicals
Group and rights of access to other books and records as provided in
Article VI of this Agreement; (9) the rights of Chemicals under the
Insurance Policies as provided in Article IX of this Agreement; (10)
any pension assets, pension funds or other Assets expressly
contemplated to be transferred, licensed or otherwise made available to
any member of the Chemicals Group pursuant to this Agreement or any
Other Agreements; and (11) all of the Assets listed on Schedule
________.
CHEMICALS ASSETS shall also mean any and all other Assets
owned or held on the Distribution Date by members of the Monsanto Group
that are related to the Chemicals Business and which the parties agree
should have been transferred to the Chemicals Group, if, had the
parties given specific consideration to such Asset as of the date
hereof, such Asset would have been classified as a Chemicals Asset;
provided, however, that no Asset shall be deemed to be a Chemicals
Asset solely as a result of this provision unless a claim with respect
thereto is made by a member of the Chemicals Group on or prior to
eighteen months after the Distribution Date.
12. CHEMICALS BALANCE SHEET: the unaudited combined balance
sheet of the Chemicals Business as of March 31, 1997 and the notes
thereto as set forth in the Proxy Statement.
13. CHEMICALS BUSINESS: (i) all businesses and operations
(including related joint ventures and alliances) of the chemicals
businesses of Monsanto as described in the Proxy Statement in the
section "Businesses and Properties of Chemicals After the Spinoff" and
as conducted on the Distribution Date, consisting principally of those
businesses and operations set forth on Schedule 1.01(13) conducted by
the Acrilan(R) Acrylic Fibers Unit, the Carpet Fibers Unit, the Nylon
Plastics and Polymers Unit, the Nylon Industrial Unit, the
Intermediates Unit, the Saflex Unit, the Phosphorus and Derivatives
Unit, the Resins Unit, the Polymer Modifiers Unit and the Industrial
Products Unit and (ii) any other business or operation on the
Distribution Date conducted by or for the Chemicals Group through the
ownership or use of the Chemicals Assets.
14. CHEMICALS CLAIM: any claim with respect to any injury,
Loss, Liability, damage or expense (x) that is or was incurred or
asserted to have been incurred prior to the Distribution Date in, or in
connection with, the Chemicals Business, the Former Chemicals Business,
the Chemicals Assets or the Chemicals Liabilities or the Joint
Ownership Properties or the P4 Business to the extent of Chemicals'
rights or obligations under the P4 Joint Venture Agreement with respect
to such claims; or (y) that is or was incurred prior to the
Distribution Date that is against any member of the Chemicals Group or
any employee of any member of the Chemicals Group; provided, that in
the case of any claim under (x) or (y) or claims identified in (i)
through (vi) below, such injury, Loss, Liability, damage or expense
(including costs of defense and reasonable attorneys' fees) are or may
be insured or insurable under one or more of the Insurance Policies.
Chemicals Claims include, without limitation, (i) claims for property
or casualty damage or any other injury, Loss, Liability, damage or
expense with respect to Chemicals Assets; (ii) claims of injury, Loss,
Liability, damage or expense arising from business interruption of any
type of the Chemicals Business or Former Chemicals Business; (iii)
claims against any member of the Chemicals Group whether or not the
Chemicals Group has or has assumed liability for such claims under this
Agreement or any of the Other Agreements; (iv) claims against any
member of the Monsanto Group to the extent any member of the Chemicals
Group has assumed liability for such claims under this Agreement or any
of the Other Agreements; (v) claims
-6-
7
involving or against any director, officer, employee, fiduciary or
agent of the Chemicals Group who are entitled or would have been
entitled to indemnification by Monsanto had the Distribution not
occurred; and (vi) claims with respect to the Chemicals Business, the
Former Chemicals Business, the Chemicals Assets, the Chemicals
Liabilities or the Joint Ownership Properties or the P4 Business to the
extent of Chemicals rights or obligations under the P4 Joint Venture
Agreement involving any other Person who is entitled or would have been
entitled to indemnification by any member of the Monsanto Group had the
Distribution not occurred.
15. CHEMICALS COMMON STOCK: the common stock, par value $.01
per share, of Chemicals. References to Chemicals Common Stock shall
also include the associated preferred share purchase rights issued
under the Chemicals Rights Plan.
16. CHEMICALS DIRECTOR: any individual who is a member of the
Board of Directors of Chemicals.
17. CHEMICALS FACILITIES: facilities which are Chemicals
Assets.
18. CHEMICALS GROUP: Chemicals and the Chemicals Subsidiaries
of which Chemicals directly or indirectly owns 100% of the stock or
other equity interest entitled to vote on the election of members to
the board of directors or similar governing body.
19. CHEMICALS LIABILITIES: excluding the Excluded Chemicals
Liabilities and excluding those Liabilities (or portions thereof) which
have been satisfied, paid or discharged prior to the Distribution Date,
(1) all Liabilities included on the Chemicals Balance Sheet or the
accounting records supporting such Chemicals Balance Sheet as adjusted
by the pro forma adjustments thereto as set forth in the Proxy
Statement and all Liabilities of either Group incurred or arising
between March 31, 1997 and the Distribution Date which would have been
included on the Chemicals Balance Sheet had they been incurred or
arisen on or prior to March 31, 1997; (2) all Liabilities relating
exclusively to or arising exclusively from the Chemicals Assets, the
Chemicals Business or the Former Chemicals Business or the disposition
of any Former Chemicals Business, whether incurred or arising prior to
or after the Distribution Date; (3) except as expressly provided in the
Other Agreements, all Liabilities relating to or arising from the
operation of its business or the use of its Assets by any member of the
Chemicals Group at any time from and after the Distribution Date; (4)
those Liabilities for worker's compensation or Third Party claims
incurred prior to the Distribution Date at a site transferred to the
Chemicals Group as part of the Chemicals Assets; (5) all Liabilities
assumed by any member of the Chemicals Group under an express provision
of this Agreement or an Other Agreement; (6) those Liabilities for
environmental remediation or other environmental responsibilities as
described to be assumed by Chemicals in Schedule _____; (7) all
Liabilities for products of the Chemicals Business or Former Chemicals
Business sold to Third Parties by any member of either Group; (8) all
Liabilities arising under the Financing Facility and the Third Party
indebtedness listed on Schedule ______; and (9) all Liabilities listed
on Schedule ___.
CHEMICALS LIABILITIES shall also mean, any and all other
Liabilities owed on the Distribution Date by members of the Monsanto
Group that are related to the Chemicals Business and which the parties
agree should have been transferred to the Chemicals Group, if, had the
parties given specific consideration to such Liability as of the date
hereof, such Liability would have been classified as a Chemicals
Liability; provided, however, that no Liability shall be deemed to be a
Chemicals Liability solely as a result of this provision
-7-
8
unless a claim with respect thereto is made by a member of the Monsanto
Group on or prior to eighteen months after the Distribution Date.
20. CHEMICALS RIGHTS PLAN: the share purchase rights plan in
the form approved by the Board of Directors of Chemicals prior to the
Distribution Date.
21. CHEMICALS SUBSIDIARIES: all of the corporations listed on
Schedule 1.01(21).
22. CHEMICALS SUPPORT AGREEMENTS: any obligation or agreement
of the Monsanto Group under any guarantee, letter of credit, bond,
letter of comfort or working capital maintenance agreement obtained
prior to the Distribution Date for the benefit of the Chemicals
Business or any member of the Chemicals Group.
23. CLAIMS ADMINISTRATION: the processing of claims made under
the Insurance Policies, including the reporting of claims to the
insurance carrier, management and defense of claims and providing for
appropriate releases upon settlement of claims.
24. CODE: the Internal Revenue Code of 1986, as amended, or
any successor legislation and the regulations promulgated thereunder.
25. CPR: the Center for Public Resources.
26. DGCL : the Delaware General Corporation Law, as amended.
27. DISTRIBUTION: the distribution to holders of shares of
Monsanto Common Stock to be effected pursuant to Article III on the
basis of one share of Chemicals Common Stock for every five (5) shares
of Monsanto Common Stock held of record as of the Record Date.
28. DISTRIBUTION DATE: the date, to be determined by the Board
of Directors of Monsanto, or such committee of the Board as shall be
designated by the Board of Directors, as of which the Distribution
shall be effected.
29. EMPLOYEE BENEFITS ALLOCATION AGREEMENT: an employee
benefits and compensation allocation agreement to be entered into
between Monsanto and Chemicals substantially in the form attached
hereto as Exhibit 1.01(29), with such changes as may be mutually
satisfactory to Monsanto and Chemicals.
30. ESCALATION NOTICE: as defined in Section 7.02(a) hereof.
31. EXCHANGE ACT: the Securities Exchange Act of 1934, as
amended, together with the rules and regulations promulgated
thereunder.
32. EXCLUDED CHEMICALS ASSETS: (i) (a) the Joint Ownership
Properties and (b) that undivided interest in the P4 Joint Venture that
is to continue to be owned by Monsanto under the P4 Joint Venture
Agreement; (ii) the phosphorus trichloride facility and related Assets
at Monsanto's plant in Luling, Louisiana; (iii) cash and cash
equivalents (as such term is used in connection with the preparation of
Monsanto's financial statements) in excess of $75,000,000; (iv)
Monsanto Enviro-Chem Systems, Inc.; (v) Xxxxxxx Construction Company;
(vi) any loan to, note of, or investment in Camelot Superabsorbents
Ltd.; (vii) all Assets of Monsanto's diamond coatings and
optical/vision business, including
-8-
9
without limitation, all Assets which were formerly owned, leased or
controlled by Diamonex, Incorporated, its subsidiaries and any entity
in which it held at any time an equity interest; (viii) agreements with
Third Parties relating to Monsanto Assets, including without
limitation, operating agreements at Monsanto Facilities which relate to
businesses sold prior to the Distribution Date; (ix) all Assets of
Monsanto's industrial alginates business; and (x) those Assets listed
on Schedule _______.
33. EXCLUDED CHEMICALS LIABILITIES: those Liabilities listed
on Schedule ________.
34. FINANCING FACILITY: (i) the commercial paper facility,
including the Issuing and Paying Agency and Assignment and Assumption
Agreement, to be entered into prior to the Distribution Date by
Monsanto, Chemicals, and an agent or co-agents selected by Monsanto,
pursuant to which, prior to the Distribution Date, Monsanto will issue
assumable commercial paper such that the sum of (x) the accreted
principal amount on the Distribution Date of commercial paper that
Chemicals will assume on the Distribution Date and (y) the principal
amount, plus accrued interest, on the Distribution Date of other Third
Party indebtedness listed on Schedule __ that Chemicals will assume on
the Distribution Date (excluding indebtedness relating to the Chemicals
SIP Trust (as defined in the Employee Benefits Allocation Agreement))
equals $1,000,000,000; and (ii) the credit agreement or agreements to
be entered into by Chemicals.
35. FOREIGN EXCHANGE RATE: with respect to any currency other
than United States dollars as of any date, the average of the bid and
asked rates at 9:00 a.m., New York City time, on such date at which
such currency may be exchanged for United States dollars as quoted by
Citibank, N.A., except that, with respect to any Indemnifiable Loss
covered by insurance, the Foreign Exchange Rate for such currency shall
be determined as set forth in Section 4.03(d)(2).
36. FORMER CHEMICALS BUSINESS: those businesses and operations
which were formerly operated by Monsanto as part of its chemicals
subsidiaries, units or divisions and which have been sold, or otherwise
disposed of, or discontinued prior to the Distribution Date including
but not limited to those businesses and operations set forth on
Schedule _______ but excluding, without limitation (except to the
extent set forth on such Schedule), (i) shut down or sold plant sites
and businesses associated with product families that continue in the
Monsanto Group or in the P4 Joint Venture; (ii) shut down or sold plant
sites and businesses previously closely integrated (supply chain) with
upstream or downstream Monsanto subsidiaries, units or divisions other
than a chemicals subsidiary, unit or division; (iii) businesses or
operations relating to any of the following: (a) health care or vision;
(b) pharmaceuticals; (c) environmental products (e.g., Brinks); (d)
food products and additives; (e) feed products and additives; (f)
BST/animal hormones; (g) agricultural chemicals; (h) pesticides (except
for chlorinated cyanuric acids or its salts, 1, 4 dichlorobenzene, 1, 4
nitrophenol); (i) seed and fertilizer; (j) lawn & garden products; (k)
blasting products; (l) animal/plant farms; (m) construction of sulfuric
acid plants/catalysts; (n) Monsanto Enviro-Chem Systems, Inc.; (o)
Xxxxxxx Construction Company; (p) controls or control valves (e.g.,
Xxxxxx Controls); (q) electron beam accelerator; (r) radiation
service/products; (s) gas products (e.g., Xxxxxxxx); (t) hollow fibers
(e.g., Permea); (u) the Dayton, Ohio plant site; (v) Pristine and
Xxxxxxxxxxx offsites; (w) Research Triangle Park site; (x) oil and gas
production and exploration; (y) petroleum refining and retailing; (z)
Monsanto Research Corporation (e.g., Mound Labs); (aa) Hub Property -
Nitro; (bb) Xxxxxx Street; (cc) metalized fabrics; (dd) DDT; (ee)
Phosphorus (P4); and (ff) those sites and businesses listed on Schedule
_______.
-9-
10
37. GOVERNMENTAL AUTHORITY: any federal, state, local, foreign
or international court, government, department, commission, board,
bureau, agency, the NYSE or other regulatory, administrative or
governmental authority.
38. GROUP: the Monsanto Group or the Chemicals Group as the
context requires.
39. INDEMNIFIABLE LOSSES: all Losses which are subject to
being indemnified by Monsanto or Chemicals pursuant to Article IV.
40. INDEMNIFYING PARTY: a Person who or which is obligated
under this Agreement to provide indemnification.
41. INDEMNITEE: a Person who may seek indemnification under
this Agreement.
42. INDEMNITY PAYMENT: an amount that an Indemnifying Party is
required to pay to an Indemnitee pursuant to Article IV.
43. INFORMATION: all records, books, contracts, instruments,
computer data and other data and information.
44. INSURANCE ADMINISTRATION: with respect to each Insurance
Policy, (1) the accounting for retrospectively-rated premiums, defense
costs, indemnity payments, deductibles and retentions as appropriate
under the terms and conditions of each of the Insurance Policies, (2)
the reporting to excess insurance carriers of any losses or claims
which may cause the per-occurrence or aggregate limits of any Insurance
Policy to be exceeded and (3) the distribution of Insurance Proceeds as
contemplated by this Agreement.
45. INSURANCE POLICY: insurance policies and insurance
contracts of any kind that are owned or maintained by, or provide a
benefit in favor of, any member of either Group or any of its
predecessors as the insured interest, including without limitation,
primary and excess policies; comprehensive general liability policies;
automobile insurance policies; aviation and aircraft insurance
policies; worker's compensation insurance policies (including without
limitation, occupational disease); property, casualty and business
interruption insurance policies; directors and officers liability
insurance policies; fiduciary insurance policies; fidelity insurance
policies; self-insurance and captive insurance company arrangements,
together with the rights, benefits and privileges thereunder; and any
insurance policy for directors and officers liability which has been
purchased to provide occurrence coverage for both continuing and former
directors, officers and employees for claims arising from or relating
to events, occurrences or other matters prior to or on the Distribution
Date. The term "Insurance Policy" expressly includes any insurance
policies or insurance contracts issued by Monsure Ltd. or Mongard Ltd.
46. INSURANCE PROCEEDS: those monies received by or on behalf
of an insured from an insurance carrier or paid by an insurance carrier
on behalf of the insured.
47. INSURED CLAIMS: those Liabilities and Losses that,
individually or in the aggregate, are covered within the terms and
conditions of any of the Insurance Policies, whether or not subject to
deductibles, coinsurance, uncollectibility or retrospectively-rated
-10-
11
premium adjustments, but only to the extent that such rights or
Liabilities are within applicable Insurance Policy limits, including
aggregates.
48. IRB: the arrangements relating to or arising out of any
one or more of the following to the extent that it relates to a
Chemicals Asset: (i) Anniston, Ala. PCRBs, Series 1992; (ii) Anniston
SWDA, SWRRRBs, Series 1992; (iii) Caribou County PCRBs, Series 1990;
(iv) Caribou County PCRBs, Series 1994A; (v) Caribou County PCRBs,
Series 1994B; (vi) Southwest III Devel. Auth. Series 1991 (callable
7/15/2004); (vii) Brazos River PCRBs, Series 1990; (viii) Brazos River
PCRBs, Series 1988; (ix) Brazos River PCRBs, Series 1994; (x) Decatur
IRBs, Series 1996; (xi) Decatur PCRBs, Series 1990; (xii) Decatur
PCRBs, Series 1992 Var.; (xiii) Decatur PCRBs, Series 1994 Var.; (xiv)
Escambia County Var. Rate Bonds 1993; (xv) Escambia County Var. Rate
Bonds 1994; (xvi) Gloucester County PCRBs, Series 1992 Var.; (xvii)
Greenville IDRBs, Series 1990 (callable 10/01/2000); (xviii) Missouri
PCRBs, Series 1988; (xix) Missouri PCRBs, Var. Rate Series 1993; (xx)
Sauget PCRBs, Series 1996; (xxi) Sauget PCRBs, Series 1992; (xxii)
Sauget PCRBs, Series 1993; (xxiii) Springfield Adj. Rate PCRBs, Sers.
1984 (callable 11/01/1999); (xxiv) Southwest III Devel. Auth. Series
1989.
49. INTELLECTUAL PROPERTY AGREEMENTS: the Intellectual
Property Transfer Agreement, substantially in the form attached hereto
as Exhibit _______________, together with various agreements attached
thereto as exhibits, with such changes as may be mutually agreed, which
have been or will be entered into on or prior to the Distribution Date
between Monsanto and Chemicals or members of their respective Groups
with respect to transfer and licensing of intellectual property.
50. IRS: the Internal Revenue Service.
51. JOINT OWNERSHIP PROPERTIES: the properties listed on
Schedule 1.01(51).
52. LEASE AGREEMENTS: the lease agreements which have been or
will be entered into on or prior to the Distribution Date between
Monsanto and Chemicals, or the appropriate members of the Monsanto
Group and the Chemicals Group, substantially in the form attached
hereto as Exhibit 1.01(52) with respect to the facilities listed on
Schedules _______.
53. LIABILITIES: all debts, liabilities and obligations,
whether absolute or contingent, matured or unmatured, liquidated or
unliquidated, accrued or unaccrued, known or unknown, whenever arising,
and whether or not the same would properly be reflected on a balance
sheet, including all costs and expenses relating thereto.
54. LITIGATION MATTERS: as defined in Section 6.06(a) hereof.
55. LOSSES: all losses, liabilities, damages, claims, demands,
judgments or settlements of any nature or kind, known or unknown,
fixed, accrued, absolute or contingent, liquidated or unliquidated,
including all reasonable costs and expenses (legal, accounting or
otherwise as such costs are incurred) relating thereto, suffered by an
Indemnitee.
56. MONSANTO: as defined in the preamble to this Agreement.
-11-
12
57. MONSANTO ASSETS: all of the Assets other than the
Chemicals Assets held on the Distribution Date by any member of either
Group, including the Excluded Chemicals Assets.
58. MONSANTO BUSINESS: all of the businesses, other than the
Chemicals Business, the Former Chemicals Business or the P4 Business,
conducted on or prior to the Distribution Date by any member of either
Group.
59. MONSANTO CERTIFICATE AMENDMENTS: the amendments to
Monsanto's Certificate of Incorporation proposed by the Board of
Directors of Monsanto for consideration at the Special Meeting.
60. MONSANTO COMMON STOCK: the common stock, par value $2.00
per share, of Monsanto.
61. MONSANTO DIRECTOR: any individual who is a member of the
Board of Directors of Monsanto following the Distribution Date.
62. MONSANTO FACILITIES: facilities which are Monsanto Assets.
63. MONSANTO GROUP: Monsanto and its Subsidiaries of which
Monsanto directly owns 100% of the stock or other equity interest
entitled to vote on the election of members to the board of directors
or similar governing body, other than members of the Chemicals Group.
64. MONSANTO LIABILITIES: except as expressly provided in the
other Agreements, all of the Liabilities, other than the Chemicals
Liabilities, of any member of the Monsanto Group whether incurred or
arising prior to or after the Distribution Date, including the Excluded
Chemicals Liabilities.
65. NOTICES: as defined in Section 10.05 hereof.
66. NYSE: the New York Stock Exchange, Inc.
67. OFFER OF SETTLEMENT: as defined in Section 7.02(c) hereof.
68. OFFEREE: as defined in Section 7.02(c) hereof.
69. OFFEROR: as defined in Section 7.02(c) hereof.
70. OPERATING AGREEMENTS: the operating agreements which have
been or will be entered into on or prior to the Distribution Date
between members of the Monsanto Group and members of the Chemicals
Group, substantially in the form attached hereto as Exhibit 1.01(70),
with such changes as may be mutually satisfactory, whereby one party
will operate a facility listed on Schedule 1.01(70) for the benefit of
the other.
71. OTHER AGREEMENTS: all Transition Services Agreements, the
Employee Benefits Allocation Agreement, all Business Transfer
Agreements, the Tax Sharing Agreement, the Intellectual Property
Agreements, the Lease Agreements, the Raw Material Supply Agreements,
the Plan and Agreement of Reorganization, the Operating Agreements and
the P4 Joint Venture Agreement.
-12-
13
72. P4 BUSINESS: the mining of phosphorus rock and processing
it into elemental phosphorous together with related activities,
including but not limited to the coking operations at Rock Springs,
Wyoming.
73. P4 JOINT VENTURE: the limited liability company created
pursuant to the P4 Joint Venture Agreement.
74. P4 JOINT VENTURE AGREEMENT: the joint venture agreements
and other related agreements which have been or will be entered into on
or prior to the Distribution Date among any of Monsanto, Chemicals and
the P4 Joint Venture with respect to the Joint Ownership Properties and
the P4 Business, substantially in the forms attached hereto as Exhibits
______ through ______, with such changes as may be satisfactory to
Monsanto and Chemicals.
75. PERSON: an individual, a partnership, a joint venture, a
corporation, a trust, a limited liability company, an unincorporated
organization or a government or any department or agency thereof.
76. PLAN: as defined in the Employee Benefits Allocation
Agreement.
77. PLAN AND AGREEMENT OF REORGANIZATION: the Plan and
Agreement of Reorganization to be adopted by Monsanto.
78. PRIME RATE: the rate which Citibank N.A. (or any successor
thereto or other major money center commercial bank agreed to by the
parties hereto) announces from time to time as its prime lending rate,
as in effect from time to time.
79. PRIVILEGED INFORMATION: as defined in Section 6.06(a)
hereof.
80. PROXY STATEMENT: the Proxy Statement dated July 14, 1997
sent to the holders of shares of Monsanto Common Stock in connection
with the Special Meeting.
81. RAW MATERIAL SUPPLY AGREEMENTS: the agreements which have
been or will be entered into on or prior to the Distribution Date
between Monsanto and Chemicals, substantially in the forms attached
hereto as Exhibit _____ through ________, with such changes as may be
mutually satisfactory, in each case providing for the supply of raw
materials to members of the Monsanto Group by members of the Chemicals
Group, or to members of the Chemicals Group by members of the Monsanto
Group.
82. RECORD DATE: the date to be determined by the Board of
Directors of Monsanto, or such committee of the Board as shall be
designated by the Board of Directors, as the record date for
determining stockholders of Monsanto entitled to receive the
Distribution.
83. REGISTRATION STATEMENT: the registration statement on Form
10 to effect the registration of the Chemicals Common Stock pursuant to
the Exchange Act.
84. REPRESENTATIVE: with respect to any Person, any of such
Person's directors, officers, employees, agents, consultants, advisors,
accountants, attorneys and representatives.
-13-
14
85. SEC: the Securities and Exchange Commission.
86. SECURITIES ACT: the Securities Act of 1933, as amended,
together with the rules and regulations promulgated thereunder.
87. SECURITY INTEREST: means any mortgage, security interest,
pledge, lien, charge, claim, option, right to acquire, voting or other
restriction, right-of-way, covenant, condition, easement, encroachment,
restriction on transfer, or other encumbrance of any nature whatsoever.
88. SERVICE AGREEMENT: any third party administrator or claims
handling agreement of any kind or nature to which any member of either
Group is directly or indirectly a party, in effect as of the date
hereof, related to the handling of Chemicals Claims.
89. SPECIAL MEETING: the special meeting of stockholders of
Monsanto to consider the Distribution and any other matters set forth
by the Board of Directors of Monsanto in the notice of the Special
Meeting.
90. SPECIAL MEETING DATE: the date determined by the Board of
Directors of Monsanto, or by such committee of the Board as designated
by the Board of Directors, for the Special Meeting.
91. SPECIAL MEETING RECORD DATE: the record date determined by
the Board of Directors of Monsanto, or by such committee of the Board
as designated by the Board of Directors, as the record date for
determining stockholders of Monsanto entitled to vote at the Special
Meeting.
92. SUBSIDIARY: with respect to any specified Person, any
corporation or other legal entity of which such Person or any of its
Subsidiaries controls or owns, directly or indirectly, more than 50% of
the stock or other equity interest entitled to vote on the election of
members to the board of directors or similar governing body; provided,
however, that for purposes of this Agreement, (1) the Chemicals
Subsidiaries shall be deemed to be Subsidiaries of Chemicals and (2)
Chemicals and the Chemicals Subsidiaries shall not be deemed to be
Subsidiaries of Monsanto or any of Monsanto's Subsidiaries.
93. TAX: as defined in the Tax Sharing Agreement.
94. TAX SHARING AGREEMENT: the tax sharing and indemnification
agreement which has been or will be entered into on or prior to the
Distribution Date between Monsanto and Chemicals substantially in the
form attached hereto as Exhibit 1.01(94), with such changes as may be
mutually satisfactory to Monsanto and Chemicals.
95. THIRD PARTY: a Person who is not a party hereto or a
wholly-owned Subsidiary thereof.
96. THIRD PARTY CLAIM: any claim, suit, arbitration, inquiry,
proceeding or investigation by or before any court, any governmental or
other regulatory or administrative agency or commission or any
arbitration tribunal asserted by a Third Party.
-14-
15
97. TRANSITION SERVICES AGREEMENT: the transition services
agreements which have been or will be entered into on or prior to the
Distribution Date between the Monsanto Group and the Chemicals Group,
substantially in the form attached hereto as Exhibit 1.01(97), with
such changes as may be mutually satisfactory, providing for (1) the
Monsanto Group to make available certain personnel and services to the
Chemicals Group and (2) the Chemicals Group to make available certain
personnel and services to the Monsanto Group, in each case for a period
of up to 18 months following the Distribution Date.
1.02 REFERENCES TO TIME. All references in this Agreement to times of
the day shall be to St. Louis time, except as otherwise specifically provided
herein.
ARTICLE II
CERTAIN TRANSACTIONS PRIOR TO THE DISTRIBUTION DATE
2.01 SHARE PURCHASE RIGHTS PLAN; CERTIFICATE OF INCORPORATION; BYLAWS.
Prior to the Distribution Date, Chemicals shall adopt the Chemicals Rights Plan.
Monsanto and Chemicals shall take all action necessary so that, at the
Distribution Date, the Restated Certificate of Incorporation and Bylaws of
Chemicals shall be in the forms attached hereto as Exhibits 2.01(a) and 2.01(b),
respectively.
2.02 ISSUANCE OF STOCK. Prior to or as of the Distribution Date, the
parties hereto shall take all steps necessary to reclassify the outstanding
shares of Chemicals Common Stock so that, except as otherwise contemplated by
this Agreement, immediately prior to or as of the Distribution Date the number
of shares of Chemicals Common Stock outstanding and held by Monsanto shall equal
the number of shares of Monsanto Common Stock outstanding on the Record Date
divided by five (rounded to the next highest whole share).
2.03 TRANSFER OF ASSETS AND ASSUMPTION OF LIABILITIES. On or prior to
the Distribution Date, the parties hereto shall and shall cause their respective
wholly-owned Subsidiaries (1) to execute instruments of assignment and transfer
and to take such other corporate action as is necessary to transfer to Chemicals
and its wholly-owned Subsidiaries all of the right, title and interest of the
Monsanto Group in the Chemicals Assets; (2) to execute instruments of assignment
and transfer and to take such other corporate action as is necessary to transfer
to Chemicals a 40% ownership interest in the P4 Joint Venture subject to the
terms and conditions set forth in the P4 Joint Venture Agreement; and (3) to
take all action necessary to cause Chemicals or its wholly-owned Subsidiaries to
assume all of the Chemicals Liabilities. A global assignment and assumption
agreement along with Business Transfer Agreements for transfers of Chemicals
Assets and assumption of Chemicals Liabilities will be executed on or prior to
the Distribution Date; provided, however, that in the event of a conflict
between such agreements and this Agreement, this Agreement will control; and
provided further that the transfer of the operating Assets of the Chemicals
Business shall be substantially completed prior to the Special Meeting.
2.04 FINANCING ARRANGEMENTS. Each of the parties hereto agrees that it
will use reasonable efforts to arrange the Financing Facility and Chemicals
agrees that it will assume the obligations with respect to the commercial paper
issued thereunder on the Distribution Date with Monsanto becoming a guarantor of
the commercial paper obligations thereunder outstanding on the Distribution Date
but otherwise having no further liability. Each of the parties hereto agrees
that it will use reasonable efforts to obtain, prior to the Distribution
-15-
16
Date, all necessary consents, waivers or amendments to each bank credit
agreement, debt security or other financing facility to which it or any of its
Subsidiaries is a party or by which it or any of its Subsidiaries is bound, or
to refinance such agreement, security or facility, in each case on terms
satisfactory to Monsanto and Chemicals and to the extent necessary to permit the
Distribution to be consummated without any material breach of the terms of such
agreement, security or facility.
2.05 REGISTRATION AND LISTING. Prior to the Distribution Date:
1. Monsanto and Chemicals shall prepare the Proxy Statement
and the Registration Statement. Chemicals shall file the Registration
Statement with the SEC. Monsanto shall file the Proxy Statement with
the SEC and shall mail the Proxy Statement to the holders of Monsanto
Common Stock as of the Special Meeting Record Date. Monsanto and
Chemicals shall use reasonable efforts to cause the Registration
Statement to become effective under the Exchange Act as promptly as
reasonably practicable.
2. The parties hereto shall use their reasonable efforts to
take all such action as may be necessary or appropriate under state
securities and Blue Sky laws in connection with the transactions
contemplated by this Agreement.
3. Monsanto and Chemicals shall prepare, and Chemicals shall
file and seek to make effective, an application for the listing of the
Chemicals Common Stock on the NYSE, subject to official notice of
issuance.
4. The parties hereto shall cooperate in preparing and filing
with the SEC the Proxy Statement and the Registration Statement, and
causing to become effective the Registration Statement and any other
registration statements or any amendments to any thereof which are
necessary or appropriate in order to effect the transactions
contemplated hereby or to reflect the establishment of, or amendments
to, any Plans contemplated in the Employee Benefits Allocation
Agreement.
5. The parties hereto shall prepare and mail to the holders of
Monsanto Common Stock such other information or documentation as the
parties shall reasonably determine and as may be required by law.
Monsanto and Chemicals shall prepare, and Monsanto or Chemicals shall,
as applicable, file such documents, and any forms, schedules, or
registration statements and any no action letter requests which are
required by applicable law or which Monsanto determines are necessary
or desirable to effectuate the Distribution, and Monsanto and Chemicals
shall each use its reasonable efforts to obtain all necessary approvals
from the SEC with respect thereto as soon as practicable.
2.06 SPECIAL MEETING. The Board of Directors of Monsanto, or
such committee of the Board as shall be designated and so authorized by the
Board of Directors of Monsanto, shall establish the Special Meeting Record Date
and the Special Meeting Date, and shall take whatever other action such Board of
Directors or such designated committee of the Board deems necessary or
convenient with respect to the Special Meeting.
2.07 AMENDMENT OF MONSANTO CERTIFICATE OF INCORPORATION. At
the Special Meeting, there will be submitted to the Monsanto stockholders for
their vote the Monsanto Certificate Amendments as well as the Distribution.
-16-
17
ARTICLE III
THE DISTRIBUTION
3.01 RECORD DATE AND DISTRIBUTION DATE. Subject to the satisfaction or
waiver of the conditions set forth in Section 10.01(a), the Board of Directors
of Monsanto, or such committee of the Board as shall be authorized and
designated by the Board of Directors, shall establish the Record Date and the
Distribution Date and any appropriate procedures in connection with the
Distribution.
3.02 THE AGENT. Prior to the Distribution Date, Monsanto shall enter
into an agreement with the Agent providing for, among other things, the payment
of the Distribution to the holders of Monsanto Common Stock in accordance with
this Article III.
3.03 DELIVERY OF SHARE CERTIFICATES TO THE AGENT. Prior to or as of the
Distribution Date, Monsanto shall deliver to the Agent a share certificate
representing all of the outstanding shares of Chemicals Common Stock to be
distributed in connection with the payment of the Distribution. After the
Distribution Date, upon the request of the Agent, Chemicals shall provide all
certificates for shares of Chemicals Common Stock or other evidence of ownership
that the Agent shall require in order to effect the Distribution.
3.04 DISTRIBUTION. Except as otherwise contemplated by this Agreement,
Monsanto shall instruct the Agent to distribute, as of the Distribution Date,
one share of Chemicals Common Stock in respect of every five (5) shares of
Monsanto Common Stock held by holders of record of Monsanto Common Stock on the
Record Date. All shares of Chemicals Common Stock issued in the Distribution
shall be duly authorized, validly issued, fully paid and nonassessable and the
holders thereof will not be entitled to preemptive rights. As soon as
practicable after the Distribution Date certificates for shares of Chemicals
Common Stock will be mailed by the Agent to such holders of record as of the
Record Date unless Chemicals uses a book entry system of stock record keeping in
which event no certificates for shares of Chemicals Common Stock will be issued
unless the stockholder so requests.
3.05 FRACTIONAL SHARES. No certificates or scrip representing
fractional interests in a share of Chemicals Common Stock will be issued.
Instead, if Chemicals does not adopt a book entry system, or if Chemicals does
adopt a book entry system but a stockholder requests a physical stock
certificate, the Agent, will, as soon as practicable after the Distribution
Date, (a) determine the number of whole shares and fractional shares of
Chemicals Common Stock allocable to each holder of record of Monsanto Common
Stock as of the Record Date, (b) aggregate all such fractional shares, and (c)
sell the whole shares attributable to the aggregate of the fractional shares at
the direction of the Agent, in open market transactions or otherwise, in each
case at then prevailing trading prices, and to cause to be distributed to each
such holder, in lieu of any fractional share, such holder's ratable share of the
proceeds of such sale, after making appropriate deductions of the amount
required, if any, to be withheld for United States federal income tax purposes.
-17-
18
ARTICLE IV
SURVIVAL, ASSUMPTION AND INDEMNIFICATION
4.01 SURVIVAL OF AGREEMENTS. All covenants and agreements of the
parties hereto contained in this Agreement and all covenants and agreements of
the parties hereto and their respective wholly-owned Subsidiaries contained in
the Other Agreements shall survive the Distribution Date in accordance with
their respective terms and shall not be merged into any deeds or other transfer
or closing instruments or documents.
4.02 TAXES. This Article IV shall not be applicable to any
Indemnifiable Losses or Liabilities related to (1) Taxes which shall be
governed by the Tax Sharing Agreement; or (2) which are otherwise expressly
provided for in those Other Agreements (excluding the Business Transfer
Agreements).
4.03 ASSUMPTION AND INDEMNIFICATION.
(a) Subject to Sections 4.02 and 4.03(c) and except as expressly
provided in the Other Agreements, from and after the Distribution Date, Monsanto
shall retain or assume, as the case may be, and shall indemnify, defend and hold
harmless each member of the Chemicals Group, and each of their Representatives
and Affiliates, from and against, (1) all Monsanto Liabilities and (2) all
Losses of any such member of the Chemicals Group, Representative or Affiliate
relating to, 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. Chemicals will use reasonable efforts
not to take and to cause its wholly-owned Subsidiaries not to take any action
outside the ordinary course of business after the Distribution Date which may
reasonably be expected to have the effect of increasing Monsanto's or its
wholly-owned Subsidiaries' Losses with respect to Monsanto Liabilities or the
indemnification provided hereunder, and Chemicals will use reasonable efforts to
take and to cause its wholly-owned Subsidiaries to take, at Monsanto's expense,
such reasonable action as Monsanto or its wholly-owned Subsidiaries may request
to mitigate all such Losses as may be incurred with respect to Monsanto
Liabilities for which Monsanto has agreed to indemnify Chemicals and provided
such actions do not unreasonably interfere with the conduct of Chemicals'
business.
(b) Subject to Section 4.02 and 4.03(c) and except as expressly
provided in the Other Agreements, from and after the Distribution Date,
Chemicals shall retain or assume, as the case may be, and shall indemnify,
defend and hold harmless each member of the Monsanto Group, and each of their
Representatives and Affiliates, from and against, (1) all Chemicals Liabilities,
including without limitation, the indebtedness under the Financing Facility, and
(2) any and all Losses of any such member of the Monsanto Group, Representative
or Affiliate relating to, arising out of or due to the failure to pay, perform
or discharge in due course the Chemicals Liabilities by any member of the
Chemicals Group who has an obligation with respect thereto. Monsanto will use
reasonable efforts not to take and to cause its wholly-owned Subsidiaries not to
take any action outside the ordinary course of business after the Distribution
Date which may reasonably be expected to have the effect of increasing
Chemicals' or its wholly-owned Subsidiaries' Losses with respect to Chemicals
Liabilities or the indemnification provided hereunder and Monsanto will use
reasonable efforts to take and will cause its wholly-owned Subsidiaries to take
at Chemicals' expense such reasonable action as Chemicals or its wholly-owned
Subsidiaries may reasonably request to mitigate all such Losses as may be
incurred with respect to Chemicals Liabilities for which Chemicals has
-18-
19
agreed to indemnify Monsanto and provided such actions do not unreasonably
interfere with the conduct of Monsanto's business.
(c) The amount which an Indemnifying Party is required to pay to any
Indemnitee pursuant to Section 4.03(a) or (b) shall be reduced (including,
without limitation, retroactively) by any Insurance Proceeds and other amounts
(including, without limitation, amounts received from Third Parties in respect
of other indemnification or contribution obligations of Third Parties) actually
recovered by such Indemnitee in reduction of the related Indemnifiable Loss, it
being understood and agreed that each member of the Monsanto Group and the
Chemicals Group shall use its reasonable best efforts, at the expense of the
Indemnifying Party, to collect any such proceeds or other such amounts to which
it or any of its wholly-owned Subsidiaries is entitled, without regard to
whether it is the Indemnified Party hereunder. If an Indemnitee receives an
Indemnity Payment in respect of an Indemnifiable Loss and subsequently receives
Insurance Proceeds or other amounts in respect of such Indemnifiable Loss, then
such Indemnitee shall pay to such Indemnifying Party an amount equal to the
difference between (1) the sum of the amount of such Indemnity Payment and the
amount of such Insurance Proceeds or other amounts actually received and (2) the
amount of such Indemnifiable Loss. An insurer or a Third Party (including,
without limitation, purchasers under any assets purchase agreements, real estate
agreements or any other agreements relating to Chemicals Liabilities or Monsanto
Liabilities, including without limitation, those agreements set forth on
Schedule _______, who would otherwise be obligated to pay any claim shall not be
relieved of the responsibility with respect thereto, or, solely by virtue of the
indemnification provisions hereof, have any subrogation rights with respect
thereto, it being expressly understood and agreed that no insurer or any other
Third Party shall be entitled to a "windfall" (i.e., a benefit they would not be
entitled to receive in the absence of the indemnification provisions set forth
herein) by virtue of the indemnification provisions hereof.
(d) If any Indemnity Payment required to be made hereunder or under any
Other Agreement is denominated in a currency other than United States dollars,
the amount of such payment, at the election of the Indemnifying Party, may be
reimbursed in local currency or shall be translated into United States dollars
using the Foreign Exchange Rate for such currency determined in accordance with
the following rules:
(1) with respect to an Indemnifiable Loss arising from payment
by a financial institution under a guarantee, comfort letter, letter of
credit, foreign exchange contract or similar instrument, the Foreign
Exchange Rate for such currency shall be determined as of the date on
which such financial institution is reimbursed;
(2) with respect to an Indemnifiable Loss covered by
insurance, the Foreign Exchange Rate for such currency shall be the
Foreign Exchange Rate employed by the insurance company providing such
insurance in settling such Indemnifiable Loss with the Indemnifying
Party; and
(3) with respect to an Indemnifiable Loss not described in
clause (1) or (2) of this Section 4.03(d), the Foreign Exchange Rate
for such currency shall be determined as of the date of payment to a
Third Party in the case of such payments or as of the date that notice
of the claim with respect to such other Indemnifiable Loss is given to
the Indemnitee.
(e) On the Distribution Date Chemicals shall assume (or shall cause one
of its wholly-owned Subsidiaries to assume) (i) the prosecution of all claims
which are Chemicals Assets
-19-
20
and are pending on the Distribution Date; and (ii) the defense against all Third
Party Claims which are Chemicals Liabilities and are pending on the Distribution
Date. Monsanto shall use reasonable efforts to make available and shall cause
its wholly-owned Subsidiaries to use reasonable efforts to make available to
Chemicals and its wholly-owned Subsidiaries, at Chemicals' expense, (i) any
personnel or any books, records or other documents within its control or which
it otherwise has the ability to make available that Chemicals or such Subsidiary
reasonably believes are necessary or appropriate for such prosecution or defense
as provided in Article VI; and (ii) such other assistance in support of the
prosecution or defense of such litigation as Chemicals or its wholly-owned
Subsidiaries may reasonably request, including without limitation, the right to
assert in the name of Monsanto or any of its wholly-owned Subsidiaries such
rights, claims, counterclaims or defenses that Monsanto or Monsanto's Subsidiary
would be or would have been entitled to assert in such litigation or in the
prosecution of or defense against such claim had the Distribution not occurred;
provided, however, that no member of the Monsanto Group shall be required to
take any action, refrain from taking any action or make available any assistance
if doing so would have the effect of increasing Liabilities of the Monsanto
Group. Monsanto will execute and will cause its wholly-owned Subsidiaries to
execute a power of attorney in the form attached hereto as Exhibit 4.03(e).
4.04 PROCEDURE FOR INDEMNIFICATION.
(a) If any Indemnitee receives notice of the assertion of any Third
Party Claim with respect to which an Indemnifying Party is obligated under this
Agreement to provide indemnification, such Indemnitee shall give such
Indemnifying Party notice thereof promptly after becoming aware of such Third
Party Claim; provided, however, that the failure of any Indemnitee to give
notice as provided in this Section 4.04 shall not relieve any Indemnifying Party
of its obligations under this Article IV, except to the extent that such
Indemnifying Party is actually prejudiced by such failure to give notice. Such
notice shall describe such Third Party Claim in reasonable detail and, if
practicable, shall indicate the estimated amount of the Indemnifiable Loss that
has been or may be sustained by such Indemnitee.
(b) An Indemnifying Party, at such Indemnifying Party's own expense and
through counsel chosen by such Indemnifying Party (which counsel shall be
reasonably satisfactory to the Indemnitee), may elect to defend any Third Party
Claim. If an Indemnifying Party elects to defend a Third Party Claim, then,
within fifteen Business Days after receiving notice of such Third Party Claim or
sooner (but in no event less than five Business Days) if the nature of such
Third Party Claim so requires), such Indemnifying Party shall notify the
Indemnitee of its intent to do so. Such Indemnitee shall thereupon use
reasonable efforts to make available to such Indemnifying Party, at such
Indemnifying Party's expense, such assistance in support of the prosecution or
defense of such litigation as the Indemnifying Party may reasonably request,
including without limitation, the right to assert in the name of the Indemnitee
such rights, claims, counterclaims or defenses that such Indemnitee would be or
would have been permitted to assert in such litigation or in the prosecution of
a claim or counterclaim against a Third Party or in defense against such Third
Party Claim had the Distribution not occurred. The Indemnitee will execute a
power of attorney in favor of the Indemnifying Party with respect to such Third
Party Claims in the form attached hereto as Exhibit ______. Such Indemnifying
Party shall pay such Indemnitee's reasonable out-of-pocket expenses incurred in
connection with such cooperation consistent with the provisions of Article VI.
Except as provided herein, after notice from an Indemnifying Party to an
Indemnitee of its election to assume the defense of a Third Party Claim, such
Indemnifying Party shall not be liable to such Indemnitee under this Article IV
for any legal or other expenses subsequently incurred by such Indemnitee in
connection with the defense thereof. If an Indemnifying Party elects not to
defend against a Third Party Claim, or fails to notify an Indemnitee of its
election as provided in this Section 4.04 within the period of fifteen (or five,
if applicable) Business Days described above, such Indemnitee may defend,
compromise and settle such Third Party Claim; provided, however,
-20-
21
that no such Indemnitee may compromise or settle any such Third Party Claim
without the prior written consent of the Indemnifying Party, which consent shall
not be unreasonably withheld or delayed.
(c) Notwithstanding the foregoing, the Indemnifying Party shall not,
without the prior written consent of the Indemnitee, settle or compromise any
Third Party Claim or consent to the entry of any judgment which does not include
as an unconditional term thereof the delivery by the claimant or plaintiff to
the Indemnitee of a written release from all Liability in respect of such Third
Party Claim.
(d) If an Indemnifying Party chooses to defend or to seek to compromise
any Third Party Claim, the related Indemnitee shall make available to such
Indemnifying Party any personnel or any books, records or other documents within
its control or which it otherwise has the ability to make available that are
necessary or appropriate for such defense.
(e) Any claim on account of an Indemnifiable Loss arising out of or due
to the failure to pay, perform or discharge in due course its respective
Liabilities by any member of the Indemnifying Party's Group who has an
obligation with respect thereto but which does not result from a Third Party
Claim shall be asserted by written notice given by the Indemnitee to the related
Indemnifying Party. Such Indemnifying Party shall have a period of 30 days after
the receipt of such notice within which to respond thereto. If such Indemnifying
Party does not respond within such 30-day period, such Indemnifying Party shall
be deemed to have refused to accept responsibility to make payment. If such
Indemnifying Party does not respond within such 30-day period or rejects such
claim in whole or in part, such Indemnitee shall be free to pursue such remedies
as may be available to such party under Article VII of this Agreement.
(f) If the amount of any Indemnifiable Loss shall, at any time
subsequent to the payment required by this Agreement, be reduced by recovery,
settlement or otherwise, the amount of such reduction, less any expenses
incurred in connection therewith, shall promptly be repaid by the Indemnitee to
the Indemnifying Party.
(g) In the event of payment by an Indemnifying Party to any Indemnitee
in connection with any Third Party Claim, such Indemnifying Party shall be
subrogated to and shall stand in the place of such Indemnitee as to any events
or circumstances in respect of which such Indemnitee may have any right or claim
relating to such Third Party Claim against any claimant or plaintiff asserting
such Third Party Claim. Such Indemnitee shall cooperate with such Indemnifying
Party in a reasonable manner, and at the cost and expense of such Indemnifying
Party, in prosecuting any subrogated right or claim, including without
limitation, permitting the Indemnifying Party to bring suit against such Third
Party in the name of the Indemnitee.
-21-
22
ARTICLE V
CERTAIN ADDITIONAL COVENANTS
5.01 FURTHER ASSURANCES.
(a) In addition to the actions specifically provided for elsewhere in
this Agreement and unless otherwise expressly provided in this Agreement or an
Other Agreement, each of the parties hereto shall use its reasonable efforts to
take, or cause to be taken, all actions, and to do, or cause to be done, all
things reasonably necessary, proper or advisable under applicable laws,
regulations and agreements to consummate and make effective the transactions
contemplated by this Agreement, to confirm Chemicals' title to all Chemicals
Assets and assumption of all Chemical Liabilities, to put Chemicals in actual
possession and operating control of Chemicals Assets and Chemicals Liabilities,
and to permit Chemicals to exercise all rights and to perform its obligations
with respect to Chemicals Assets and Chemicals Liabilities; provided, that
nothing herein shall be deemed to require the transfer of any Assets or the
assumption of any Liabilities which by their terms or operation of law cannot be
transferred or assumed. Without limiting the foregoing, each party hereto shall
cooperate with the other party, and execute and deliver, or use its reasonable
efforts to cause to be executed and delivered, all instruments, including
instruments of conveyance, assignment and transfer, and to make all filings
with, and to obtain all consents, approvals or authorizations of, any
governmental or regulatory authority or any other Person under any permit,
license, agreement, indenture or other instrument, and take all such other
actions as such party may reasonably be requested to take by any other party
hereto from time to time, consistent with the terms of this Agreement, in order
to effectuate the provisions and purposes of this Agreement and the transfers of
Assets and Liabilities and the other transactions contemplated hereby. If any
such transfer of Assets or Liabilities, including but not limited to,
assignments of contracts, is not consummated prior to or at the Distribution
Date for any reason, including but not limited to, the absence of consents to
assignment of contracts or approval by Governmental Authorities for the transfer
of permits, then the party hereto retaining such Asset or Liability shall
thereafter hold such Asset in trust for the use and benefit of the party
entitled thereto (at the expense of the party entitled thereto), or shall retain
such Liability for the account of the party by whom such Liability is to be
assumed pursuant hereto, as the case may be, and shall take such other action as
may be reasonably requested by the party to whom such Asset is to be
transferred, or by whom such Liability is to be assumed, as the case may be, in
order to place such party, insofar as reasonably possible, in the same position
as if such Asset or Liability had been transferred as contemplated hereby. If
and when any such Asset or Liability becomes transferable, such transfer shall
be effected forthwith. The parties hereto agree that, as of the Distribution
Date, as between the parties, Chemicals shall be deemed to have acquired
complete and sole beneficial ownership of all of the Chemicals Assets, together
with all rights, powers and privileges incident thereto, and shall be deemed to
have assumed in accordance with the terms of this Agreement all of the Chemicals
Liabilities, and all duties, obligations and responsibilities incident thereto.
(b) Without limiting the generality of Section 5.01(a), Monsanto, as
the sole stockholder of Chemicals prior to the Distribution, shall ratify any
actions which are reasonably necessary or desirable to be taken by Chemicals to
effectuate the transactions contemplated by this Agreement or the Other
Agreements in a manner consistent with the terms of this Agreement or such Other
Agreements.
(c) In the event any registration, licenses, permits or other rights
granted by Governmental Authorities to the Monsanto Group must be transferred,
amended or issued in order to conduct operations of the Chemicals Business after
the Distribution Date, and such permit transfer, amendment or issuance has not
been accomplished as of such date, Monsanto shall permit
-22-
23
Chemicals to use the registration, license or permit of the Monsanto Group to
continue to operate the Chemicals Facilities until such transfer, amendment or
issuance is accomplished, at Chemicals' expense, if to so do would be permitted
by and not violate the terms of the registration, license or permit or any law,
regulation, ordinance or rule, until such permit is transferred or issued to
Chemicals. Chemicals shall use its reasonable efforts to obtain such
registrations, licenses, permits or other rights granted by Governmental
Authorities as soon as reasonably practicable. Chemicals shall indemnify and
hold harmless Monsanto from and against any and all Third Party Claims arising
from or related to Chemicals' use of the registration, license or permit or
other rights granted to the Monsanto Group by Governmental Authorities.
(d) Schedule 1.01(11) to this Agreement includes among other
items, certain parcels of real estate which are Chemicals Assets but which, in
some cases, are subject to contracts for sale to Third Parties ("Sale Real
Estate") or which, in other cases, cannot be transferred without one party
incurring a substantial economic detriment which detriment could otherwise be
deferred or avoided ("Non-Sale Real Estate"). Monsanto and Chemicals agree that
Monsanto shall retain title to such Sale Real Estate and Non-Sale Real Estate
following the Distribution Date and shall not transfer to Chemicals the title or
assign to Chemicals the contract(s) for sale or any other permits, licenses or
contracts with respect to such real estate subject to the following terms and
conditions:
(i) Monsanto from and after the Distribution Date will hold the Sale
Real Estate and the Non-Sale Real Estate in trust for the benefit of Chemicals;
(ii) Monsanto hereby irrevocably designates Chemicals as its
attorney-in-fact and agent for all purposes with respect to all such Sale Real
Estate and Non-Sale Real Estate, including without limitation, for all
remediation, monitoring and other activities, with respect to such Sale Real
Estate and Non-Sale Real Estate; for all filings, notices and any other
negotiations, activities or discussions with any Governmental Authority and/or
any branch, commission, board or other subdivision thereof; for all discussions,
negotiations or agreements with Third Parties with respect to, or arising from,
such Sale Real Estate and Non-Sale Real Estate; and for all purposes relating to
the execution, delivery and closing of contracts, agreements, documents or
instruments with respect the ownership, use, occupation, sale or lease of the
Sale Real Estate or Non-Sale Real Estate. In furtherance of such designation,
Monsanto will execute powers of attorney in the form attached hereto as Exhibit
5.01(d)(ii) for each site;
(iii) Monsanto will take no action without the prior written consent of
Chemicals which may have the effect of increasing Chemicals' liability with
respect to any Sale Real Estate or Non-Sale Real Estate; and will take such
action as is permitted by contract, in the absence of consent of the other
party, and by law to place Chemicals, insofar as reasonably possible, in the
same position as if such Sale Real Estate and Non-Sale Real Estate had been
transferred, or conveyed to Chemicals on the Distribution Date;
(iv) In the event any Sale Real Estate is not sold or conveyed to a
Third Party pursuant to a contract in existence on the Distribution Date or, at
any other time, upon the request of Chemicals with respect to any parcel of Sale
Real Estate or Non-Sale Real Estate, Monsanto shall transfer and convey title to
the affected parcel of real estate to Chemicals; and
(v) As between Monsanto and Chemicals, such Sale Real Estate and
Non-Sale Real Estate shall be treated as Chemicals Assets, and Liabilities
related to or arising from Sale Real Estate or Non-Sale Real Estate shall be
Chemicals Liabilities and subject to the indemnification provisions contained in
Section 4.03(b) notwithstanding the fact that such Sale Real Estate or Non-Sale
Real Estate was not transferred to Chemicals.
-23-
24
(e) If Chemicals elects to pursue any claim or right relating to the
Chemicals Assets, the Chemicals Business or the Former Chemicals Business,
Monsanto, upon request and at Chemicals' expense, shall use reasonable efforts
to make available to Chemicals such assistance in support of the prosecution of
such litigation as Chemicals may reasonably request, including without
limitation, the right to assert, as needed, in the name of Monsanto or any
member of the Monsanto Group such rights and claims that Monsanto or such member
would be or would have been permitted to assert in such litigation had the
Distribution not occurred; provided, however, that no member of the Monsanto
Group shall be required to take any action, refrain from taking any action or
make available any assistance if doing so would have the effect of increasing
Liabilities of the Monsanto Group. Monsanto or such member of the Monsanto Group
will execute a power of attorney in favor of Chemicals or such member of the
Chemicals Group in the form attached hereto as Exhibit ____.
5.02 CHEMICALS BOARD. Prior to, or simultaneously with, the
Distribution Date, Chemicals shall take such actions as are necessary such that
the Board of Directors of Chemicals is comprised of those individuals named as
directors of Chemicals in the Proxy Statement.
5.03 FINANCING. Effective as of the Distribution Date:
(a) The obligations under the assumable commercial paper
portion of the Financing Facility shall be assigned to, and assumed by,
Chemicals, and guaranteed by Monsanto, with the effect that Chemicals
shall have the primary obligation thereunder and Monsanto shall become
the guarantor with respect thereto;
(b) On the Distribution Date, Chemicals shall assume from
Monsanto, and indemnify Monsanto from, all Liabilities under the
assumable commercial paper portion of the Financing Facility and the
Third Party indebtedness specified on Schedule __; and
(c) (i) Except as provided in Schedule ___, (w) all
intercompany accounts receivables and payables between members of the
Monsanto Group in Europe and in South Africa, and all Third Party
receivables and payables owed to or by members of the Monsanto Group in
Europe and in South Africa that arose prior to June 1, 1997, will be
treated in accordance with the related Business Transfer Agreement,
including without limitation, that Agreement on Intercompany
Receivables and Payables and Bad Debts dated as of ________________
between Monsanto Chemicals Europe SA/NV and Monsanto Europe SA/NV and
certain other entities referred to collectively therein as DSO's; (x)
all intercompany accounts receivables and payables between members of
the Monsanto Group in Europe and in South Africa, and all Third Party
receivables and payables related to the Monsanto Business in Europe and
in South Africa that arose on or after June 1, 1997, will remain as
Monsanto Assets and Monsanto Liabilities; (y) all intercompany accounts
receivables and payables between members of the Chemicals Group in
Europe and in South Africa and all Third Party receivables and payables
related to the Chemicals Business in Europe and South Africa that arose
on or after June 1, 1997 shall remain as Chemicals Assets and Chemicals
Liabilities; and (z) any other product related intercompany receivables
and payables between members of the Monsanto Group in Europe and in
South Africa and members of the Chemicals Group in Europe and in South
Africa shall remain with each respective entity on whose books such
receivable and payable exists on the Distribution Date; provided,
however, that any other intercompany receivables and payables between
members of the Groups shall be transferred to the Monsanto Group.
(c) (ii) Except as provided in Schedule ___, all intercompany
balances relating to products of the Chemicals Business or Former
Chemicals Business between the Monsanto
-24-
25
Group outside of Europe and South Africa and the Chemicals Group
outside of Europe and South Africa and all Third Party payables and
receivables related to the Chemicals Business, Former Chemicals
Business or Chemicals Assets will be transferred to the Chemicals Group
as Chemicals Assets and Chemicals Liabilities on the Distribution Date.
(c) (iii) Except as provided herein with respect to certain
intercompany loans for which both the asset and the liability will be
transferred to the Chemicals Group as set forth in Schedule _______,
all intercompany loans or advances between a member of the Chemicals
Group and a member of the Monsanto Group shall remain with, or be
transferred to, the members of the Monsanto Group, it being the intent
that as of the Distribution Date neither Group shall have a continuing
obligation with respect to such loan or and advance to the other Group.
5.04 OTHER AGREEMENTS. Each of Monsanto and Chemicals shall
use reasonable efforts to enter into, or to cause the appropriate members of its
Group to enter into, the Other Agreements on or prior to the Distribution Date.
If there shall be a conflict or an inconsistency between the provisions of this
Agreement and the provisions of an Other Agreement (i) the provisions of this
Agreement shall control over the inconsistent provisions of a Business Transfer
Agreement as to matters within the scope of the Business Transfer Agreement; and
(ii) the provisions of the Other Agreement (other than any Business Transfer
Agreement) shall control over the inconsistent provisions of this Agreement as
to matters within the scope of such Other Agreement.
5.05 CHEMICALS SUPPORT AGREEMENTS. Effective as of the
Distribution Date, and unless otherwise agreed between Monsanto and Chemicals,
Chemicals shall use its reasonable best efforts to cause one or more members of
the Chemicals Group to be substituted in all respects for the Monsanto Group or
any member thereof in respect of all Chemicals Support Agreements. Subsequent to
the Distribution Date, with respect to any uncancelled Chemicals Support
Agreement for which no substitution has yet been effected, Chemicals shall
indemnify the Monsanto Group against any Liabilities under any such Chemicals
Support Agreement in accordance with the provisions of Article IV.
5.06 OFFICERS AND EMPLOYEES.
(a) Subject to the provisions of Section 5.06(b), officers and
employees of either Group who are employed in the Chemicals Business immediately
prior to the Distribution Date shall be officers and employees of the Chemicals
Group immediately following the Distribution Date; provided, however, that
nothing herein shall give to any individual a right of employment, or continued
employment, by any member of the Chemicals Group.
(b) Except as otherwise agreed by the parties hereto,
effective as of the Distribution Date, (1) all officers or employees of the
Monsanto Group who are acting as directors or officers of the Chemicals Group
and are not employed in the Chemicals Business shall resign from such positions
with the Chemicals Group and (2) all officers or employees of the Chemicals
Group who are acting as directors or officers of the Monsanto Group and are not
employed in the Monsanto Business shall resign from such positions with the
Monsanto Group.
5.07 MONSANTO CITIZENSHIP FUND. Prior to the Distribution
Date, Chemicals will establish a political action committee consistent with the
rules of the Federal Election Commission for a separate segregated fund
("Chemicals PAC") and the Monsanto Citizenship Fund will transfer to such
Chemicals PAC $________ plus any amounts held by the Monsanto Citizenship Fund
for future earmarking by Chemicals Employees which has been or may be agreed to.
-25-
26
5.08 RECEIVABLES COLLECTION AND OTHER PAYMENTS. If after the
Distribution Date, either party receives payments belonging to the other party,
the recipient shall promptly account for and remit same to the other party.
5.09 LIMITED LEASES, LICENSES AND BENEFITS OF CERTAIN ASSETS.
(a) With respect to sold or discontinued businesses for which
Chemicals has assumed a Chemicals Liability, Monsanto hereby grants a lease or
license, and shall cause its wholly-owned Subsidiaries to grant a lease or
license, to members of the Chemicals Group, without compensation and on a
non-exclusive basis, with respect to such Monsanto Assets (or the benefit of
such Monsanto Assets) relating to sold or discontinued businesses, including
without limitation, those rights under contracts, leases or licenses held on the
Distribution Date, in each case to the extent the use or benefit of such
Monsanto Assets is reasonably necessary to satisfy such Chemicals Liabilities
assumed by any member of the Chemicals Group pursuant to this Agreement or any
Other Agreement.
(b) With respect to a Former Chemicals Business for which
Monsanto has retained a Monsanto Liability, including without limitation,
Monsanto Liabilities under operating agreements with Third Parties, Chemicals
hereby grants a lease or license, and shall cause its wholly-owned Subsidiaries
to grant a lease or license, to members of the Monsanto Group, without
compensation and on a non-exclusive basis with respect to such Chemicals Assets
(or the benefit of such Chemicals Assets) relating to the Former Chemicals
Business, including without limitation, those rights under contracts, leases or
licenses held on the Distribution Date, in each case to the extent the use or
benefit of such Chemicals Assets is reasonably necessary to satisfy such
Monsanto Liabilities.
5.10 CHEMICALS' USE OF CHEMICALS ASSETS SUBJECT TO IRBS.
Monsanto is retaining as Monsanto Liabilities the IRBs and all obligations
related to the payment of principal and interest thereunder and is retaining as
Monsanto Assets all rights with respect to the IRBs except the right to the
ownership or occupancy of the property transferred to Chemicals as Chemicals
Assets. Chemicals, however, agrees that Chemicals shall comply with all of the
covenants and agreements set forth in the IRBs and any related agreements
entered into in connection with the IRBs that are applicable to the owner or
operator of the property or that affect the use of the property and shall not
take any action which, or fail to take any action the failure of which, could
increase or accelerate Monsanto's liabilities under the IRBs or adversely affect
the exclusion from gross income of interest on the IRBs. Chemicals shall not
sell or otherwise transfer any properties or assets relating to the IRBs unless
the transferee agrees to assume Chemicals' obligations under this Section 5.10
pursuant to an agreement reasonably satisfactory to Monsanto. Chemicals shall
indemnify, defend and hold Monsanto harmless from any Liabilities or Losses to
the extent arising from its breach of its covenants in this Section 5.10.
ARTICLE VI
ACCESS TO INFORMATION
6.01 PROVISION OF CORPORATE RECORDS. Prior to or as promptly
as practicable after the Distribution Date or from time to time as requested by
the Chemicals Group, the Monsanto Group shall deliver to the Chemicals Group:
(i) all corporate books and records of the Chemicals Group; (ii) originals or
copies of those corporate books and records of the Monsanto Group primarily
relating to the Chemicals Assets, the Chemicals Liabilities, the
-26-
27
Chemicals Business or the Former Chemicals Business; (iii) originals or, at
Monsanto's election, copies of all other corporate records and books of the
Monsanto Group relating to the Chemicals Group, Chemicals Assets, the Chemicals
Liabilities, the Chemicals Business, the Former Chemicals Business, the Joint
Ownership Properties, the P4 Business, or the Other Agreements; including
without limitation in each case, all active agreements, active litigation files
and government filings; and (iv) copies of any and all Insurance Policies. From
and after the Distribution Date, all such books, records and copies (where
copies are delivered in lieu of originals) whether or not delivered shall be the
property of the Chemicals Group; provided, however, that all such Information
contained in such books, records or copies relating to the Monsanto Group,
Monsanto Assets, the Monsanto Liabilities, the Monsanto Business, the Joint
Ownership Properties, the P4 Business, or the Other Agreements shall be subject
to the applicable confidentiality provisions and restricted use provisions, if
any, contained in this Agreement or the Other Agreements and any confidentiality
restrictions imposed by law. Monsanto, if it so elects, may retain copies of any
original books and records delivered to Chemicals along with those original
books and records of the Monsanto Group authorized herein to be retained
(excluding books and records to the extent relating to Chemicals Technology as
defined in the Intellectual Property Agreements or relating exclusively to
Chemicals' use of Shared Know How as defined in the Intellectual Property
Agreements in the Chemicals Business or Former Chemicals Business); provided,
however, that all such Information contained in such books, records or copies
(whether or not delivered to the Chemicals Group) relating to the Chemicals
Group, the Chemicals Assets, the Chemicals Liabilities, the Chemicals Business,
the Former Chemicals Business, the Joint Ownership Properties, the P4 Business,
or the Other Agreements shall be subject to the applicable confidentiality
provisions and restricted use provisions, if any, contained in this Agreement or
the Other Agreements and any confidentiality restrictions imposed by law.
6.02 ACCESS TO INFORMATION. In addition to the provisions set
forth in Section 6.01 above, from and after the Distribution Date and upon
reasonable notice, each of the Monsanto Group and the Chemicals Group shall
afford to the other and to the other's Representatives at the expense of the
other party, reasonable access and duplicating rights during normal business
hours to all Information developed or obtained prior to the Distribution Date
within such party's possession relating to the other party or its businesses,
its former businesses, its Assets, its Liabilities, the Joint Ownership
Properties, the P4 Business, or the Other Agreements, insofar as such access is
reasonably requested by such other party, but subject to the applicable
confidentiality provisions and restricted use provisions, if any, contained in
this Agreement or the Other Agreements and any confidentiality restrictions
imposed by law. In addition, without limiting the foregoing, Information may be
requested under this Section 6.02 for audit, accounting, claims, intellectual
property protection, litigation and Tax purposes, as well as for purposes of
fulfilling disclosure and reporting obligations. In each case, the requesting
party agrees to cooperate with the other party to minimize the risk of
unreasonable interference with the other party's business. In the event access
to any Information otherwise required to be granted herein or in the Other
Agreements is restricted by law or otherwise, the parties agree to take such
actions as are reasonably necessary, proper or advisable to have such
restrictions removed or to seek an exemption therefrom or to otherwise provide
the requesting party with the benefit of the Information to the same extent such
actions would have been taken on behalf of the requesting party had such a
restriction existed and the Distribution not occurred.
6.03 LITIGATION SUPPORT AND PRODUCTION OF WITNESSES. After the
Distribution Date, each member of the Monsanto Group and the Chemicals Group
shall use reasonable efforts to provide assistance to the other with respect to
litigation and to make available to the other, upon written request: (i) such
employees who have expertise or knowledge with respect
-27-
28
to the other party's business or products or matters in litigation, for the
purpose of consultation and/or as a witness; and (ii) its directors, officers,
other employees and agents, as witnesses, in each case to the extent that the
requesting party believes any such Person may reasonably be useful or required
in connection with any legal, administrative or other proceedings in which the
requesting party may from time to time be involved. The employing party agrees
that such consultant or witness shall be made available to the requesting party
upon reasonable notice to the same extent that such employing party would have
made such consultant or witness available if the Distribution had not occurred.
The requesting party agrees to cooperate with the employing party in giving
consideration to business demands of such Persons.
6.04 REIMBURSEMENT. Except to the extent otherwise
contemplated by this Agreement or any Other Agreement, a party providing
Information, consultant, or witness services to the other party under this
Article VI shall be entitled to receive from the recipient, upon the
presentation of invoices therefor, payments for such amounts, relating to
supplies, disbursements, travel expenses, and other out-of-pocket expenses
(including the direct and indirect costs of employees providing consulting and
expert witness services in connection with litigation, but excluding direct and
indirect costs of employees who provide Information or are fact witnesses) as
may be reasonably incurred in providing such Information, consulting or witness
services.
6.05 RETENTION OF RECORDS. Except as otherwise required by law
or agreed in writing, or as otherwise provided in the Tax Sharing Agreement,
each member of the Monsanto Group and the Chemicals Group shall retain, for the
periods set forth in the Monsanto Company Records Retention Manual dated April,
1994 or such longer period as may be required by law, this Agreement or the
Other Agreements, all significant Information in such party's possession or
under its control relating to the business, former business, Assets or
Liabilities of the other party or the Joint Ownership Properties or the P4
Business or this Agreement or the Other Agreements and, after the expiration of
such applicable period, prior to destroying or disposing of any of such
Information, (a) the party proposing to dispose of or destroy any such
Information shall provide no less than 30 days' prior written notice to the
other party, specifying the Information proposed to be destroyed or disposed of,
and (b) if, prior to the scheduled date for such destruction or disposal, the
other party requests in writing that any of the Information proposed to be
destroyed or disposed of be delivered to such other party, the party proposing
to dispose of or destroy such Information promptly shall arrange for the
delivery of the requested Information to a location specified by, and at the
expense of, the requesting party.
6.06 PRIVILEGED INFORMATION. In furtherance of the rights and
obligations of the parties set forth in this Article VI:
(a) Each party hereto acknowledges that (1) each of the
Monsanto Group on the one hand, and the Chemicals Group on the other
hand, has or may obtain Information regarding a member of the other
Group, or any of its operations, employees, Assets or Liabilities
(whether in documents or stored in any other form or known to its
employees or agents), as applicable, that is or may be protected from
disclosure pursuant to the attorney-client privilege, the work product
doctrine or other applicable privileges ("Privileged Information"); (2)
there are a number of actual, threatened or future litigations,
investigations, proceedings (including arbitration proceedings), claims
or other legal matters that have been or may be asserted by or against,
or otherwise affect, each or both of Monsanto and Chemicals (or members
of either Group) ("Litigation Matters"); (3) Monsanto and Chemicals
have a common legal interest in Litigation Matters, in the Privileged
Information, and in the preservation of the
-28-
29
confidential status of the Privileged Information, in each case
relating to the Monsanto Business or the Chemicals Business or any
former businesses, the Assets or the Liabilities of each party or the
Joint Ownership Properties or the P4 Business as it or they existed
prior to the Distribution Date or relating to or arising in connection
with the relationship between the constituent elements of the Groups on
or prior to the Distribution Date; and (4) Monsanto and Chemicals
intend that the transactions contemplated by this Agreement and the
Other Agreements and any transfer of Privileged Information in
connection herewith or therewith shall not operate as a waiver of any
potentially applicable privilege.
(b) Each of Monsanto and Chemicals agrees, on behalf of itself
and each member of the Group of which it is a member, not to disclose
or otherwise waive any privilege attaching to any Privileged
Information relating to the Monsanto Business or the Chemicals Business
or any former businesses or Assets or Liabilities of either party or
the Joint Ownership Properties or the P4 Business as they or it existed
prior to the Distribution Date, respectively, or relating to or arising
in connection with the relationship between the Groups on or prior to
the Distribution Date, without providing prompt written notice to and
obtaining the prior written consent of the other, which consent shall
not be unreasonably withheld and shall not be withheld if the other
party certifies that such disclosure is to be made in response to a
likely threat of suspension or debarment or similar action; provided,
however, that Monsanto and Chemicals may make such disclosure or waiver
with respect to Privileged Information if such Privileged Information
relates, in the case of Monsanto, solely to the Monsanto Business, its
former businesses (other than the Chemicals Business or Former
Chemicals Business or the P4 Business), the Monsanto Assets or the
Monsanto Liabilities as each existed prior to the Distribution Date or,
in the case of Chemicals, solely to the Chemicals Business, the Former
Chemicals Business, the Chemicals Assets or the Chemicals Liabilities,
as each existed prior to the Distribution Date. In the event of a
disagreement between any member of the Monsanto Group and any member of
the Chemicals Group concerning the reasonableness of withholding such
consent, no disclosure shall be made prior to (i) a final,
nonappealable resolution of such disagreement by a court of competent
jurisdiction if such requirement to disclose is part of a pending
judicial proceeding; or (ii) a final determination by an arbitrator
appointed pursuant to Article VII if such requirement to disclose is
not part of a pending judicial proceeding.
(c) Upon any member of the Monsanto Group or any member of the
Chemicals Group receiving any subpoena or other compulsory disclosure
notice from a court, other governmental agency or otherwise which
requests disclosure of Privileged Information, in each case relating to
the Monsanto Business, its former businesses (other than the Chemicals
Business or Former Chemicals Business or the P4 Business), the Monsanto
Assets or the Monsanto Liabilities (in the case of the Chemical Group)
or the Chemicals Business, Former Chemicals Business, the Chemicals
Assets or the Chemicals Liabilities (in the case of the Monsanto Group)
or the Joint Ownership Properties or the P4 Business (in the case of
either Group), as they or it existed prior to the Distribution Date or
relating to or arising in connection with the relationship between the
constituent elements of the Groups on or prior to the Distribution
Date, the recipient of the notice shall promptly provide to Monsanto,
in the case of receipt by a member of the Chemicals Group, or to
Chemicals, in the case of receipt by a member of the Monsanto Group, a
copy of such notice, the intended response, and all materials or
information relating to the other Group that might be disclosed. In the
event of a disagreement as to the intended response or disclosure,
unless and until the
-29-
30
disagreement is resolved as provided in paragraph (b) above, Monsanto
and Chemicals shall cooperate to assert all defenses to disclosure
claimed by either Group, at the cost and expense of the Group claiming
such defense to disclosure, and shall not disclose any disputed
documents or information until all legal defenses and claims of
privilege have been finally determined.
6.07 CONFIDENTIALITY. From and after the Distribution Date,
each of Monsanto and Chemicals shall hold, and shall use its reasonable best
efforts to cause its employees, Affiliates and Representatives to hold, in
strict confidence all Information concerning or belonging to the other party
obtained by it prior to the Distribution Date or furnished to it by such other
party pursuant to this Agreement or the Other Agreements and shall not release
or disclose such Information to any other Person, except its Representatives,
who shall be bound by the provisions of this Section 6.07; provided, however,
that Monsanto and Chemicals and their respective employees, Affiliates and
Representatives may disclose such Information to the extent that (a) disclosure
is compelled by judicial or administrative process or, in the opinion of such
party's counsel, by other requirements of law, or (b) such party can show that
such Information was (1) available to such party after the Distribution Date
from Third Party sources other than employees or former employees of either
party, their Affiliates, former Affiliates, Representatives or former
Representatives, on a nonconfidential basis prior to its disclosure to such
party after the Distribution Date by the other party, (2) in the public domain
through no fault of such party, (3) lawfully acquired by such party from Third
Party sources other than employees or former employees of either party, their
Affiliates, former Affiliates, Representatives or former Representatives, after
the time that it was furnished to such party pursuant to this Agreement or the
Other Agreements or (4) is independently discovered or developed after the
Distribution Date by employees of such party. Notwithstanding the foregoing,
each of Monsanto and Chemicals and their respective Representatives and
Affiliates shall be deemed to have satisfied its obligations under this Section
6.07 with respect to any Information if it exercises the same care with regard
to such Information as it takes to preserve confidentiality for its own similar
Information. Each party further covenants that it shall not disclose to any
Third Party (or any successor by merger or otherwise) the fact that the other
party uses Shared Know How (as defined in the Intellectual Property Agreements)
or if known, the particulars of such use.
ARTICLE VII
ARBITRATION; DISPUTE RESOLUTION
7.01 AGREEMENT TO ARBITRATE. Except as otherwise specifically
provided in any Other Agreement, the procedures for discussion, negotiation and
arbitration set forth in this Article VII shall apply to all disputes,
controversies or claims (whether sounding in contract, tort or otherwise) that
may arise out of or relate to, or arise under or in connection with this
Agreement or any Other Agreement, or the transactions contemplated hereby or
thereby (including all actions taken in furtherance of the transactions
contemplated hereby or thereby on or prior to the date hereof), or the
commercial or economic relationship of the parties as it relates to this
Agreement or such Other Agreement between or among any member of the Monsanto
Group and the Chemicals Group. Each party agrees on behalf of itself and each
member of its respective Group that the procedures set forth in this Article VII
shall be the sole and exclusive remedy in connection with any dispute,
controversy or claim relating to any of the foregoing matters and irrevocably
waives any right to commence any Action in or before any Governmental Authority,
except as expressly provided in Sections 7.07(b) and 7.08
-30-
31
and except to the extent provided under the Arbitration Act in the case of
judicial review of arbitration results or awards.
7.02 ESCALATION.
(a) It is the intent of the parties to use their respective
reasonable best efforts to resolve expeditiously any dispute, controversy or
claim between or among them with respect to the matters covered hereby that may
arise from time to time on a mutually acceptable negotiated basis. In
furtherance of the foregoing, at the request of either party from time to time
in a written notice to the other party, the parties agree to negotiate in good
faith to resolve any controversies, claims or disputes under this Agreement or
an Other Agreement. If the parties cannot otherwise resolve the matter under
consideration, then any party involved in such a dispute, controversy or claim
may deliver a notice (an "Escalation Notice") demanding an in-person meeting of
the Chief Executive Officers (each, a "CEO") of Monsanto and Chemicals who shall
meet with respect to such matters, and who shall thereafter negotiate in good
faith with each other. Each party shall deliver, at the same time the Escalation
Notice is delivered pursuant to the preceding sentence, a copy of any such
Escalation Notice to the General Counsel of each other party involved in the
dispute, controversy or claim (which copy shall state that it is an Escalation
Notice pursuant to this Agreement). Any agenda, location or procedures for such
discussions or negotiations between the parties may be established by the
parties from time to time; provided, however, that the parties shall use their
reasonable efforts to meet within 30 days of the delivery of the Escalation
Notice.
(b) At any time, the parties may, by mutual consent, retain a
mediator to aid the parties in their discussions and negotiations by informally
providing advice to the parties. Any opinion expressed by the mediator shall be
strictly advisory and shall not be binding on the parties, nor shall any opinion
expressed by the mediator be admissible or be made known to the arbitrator in
any arbitration proceedings. The mediator may be chosen from a list of mediators
previously selected by the parties or by other agreement of the parties. Costs
of the mediation shall be borne equally by the parties involved in the matter,
except that each party shall be responsible for its own expenses. Mediation is
not a prerequisite to a demand for arbitration under Section 7.03.
(c) At any time after the delivery of the Escalation Notice, a
party (the "Offeror") may serve upon the other party (the "Offeree") an offer to
settle the dispute upon the payment or receipt of a specified sum (the "Offer of
Settlement"). If the Offer of Settlement is not accepted within thirty days of
receipt of such Offer or within such other longer period of time as may be
specified in the Offer of Settlement, if the Offeror made its CEO available for
a meeting or discussion and if the award or judgment finally obtained is not
more favorable to the Offeree than the Offer of Settlement, the Offeree must pay
the costs, including reasonable attorney's fees, incurred by the Offeror after
the making of the Offer of Settlement. The fact that an Offer of Settlement is
made and not accepted shall not preclude a subsequent offer by either party. The
Offer of Settlement shall be designated as such and copies of the Offer of
Settlement shall be given to the General Counsel and Chief Executive Officer of
each party involved in the dispute. The parties agree to keep confidential and
not to disclose to the arbitrator the fact or the amount of any Offer of
Settlement made.
7.03 DEMAND FOR ARBITRATION.
(a) At any time after the first to occur of (1) forty-five
(45) days after the date of the meeting actually held pursuant to the applicable
Escalation Notice or (2) ninety (90)
-31-
32
days after the delivery of an Escalation Notice (as applicable, the "Arbitration
Demand Date"), any party involved in the dispute, controversy or claim may make
a written demand (the "Arbitration Demand Notice") that the dispute be resolved
by binding arbitration, which Arbitration Demand Notice shall be given to the
parties to the dispute, controversy or claim in the manner set forth in Section
10.05. In the event that any party shall deliver an Arbitration Demand Notice to
another party, such other party may itself deliver an Arbitration Demand Notice
to such first party with respect to any related dispute, controversy or claim
without the requirement of delivering an Escalation Notice. No party may assert
that the failure to resolve any matter during any discussions or negotiations or
the course of conduct during the discussions or negotiations in each case, as
contemplated by Section 7.02, is a prerequisite to a demand for arbitration
under Section 7.03. In the event that any party delivers an Arbitration Demand
Notice with respect to any dispute, controversy or claim that is the subject of
any then-pending arbitration proceeding or of a previously delivered Arbitration
Demand Notice, all such disputes, controversies and claims shall be resolved in
the arbitration proceeding for which an Arbitration Demand Notice was first
delivered unless the arbitrator in his or her sole discretion determines that it
is impracticable or otherwise inadvisable to do so.
(b) The parties agree that the giving of an Escalation Notice or an
Arbitration Demand Notice followed by good faith discussions, negotiations,
mediations or arbitration between the parties pursuant to this Agreement or the
Other Agreements will toll the applicable statute of limitations during the time
period consumed in compliance with this Article VII with respect to such claims.
Subject to Sections 7.07(d) and 7.08, upon delivery of an Arbitration Demand
Notice pursuant to Section 7.03(a), the dispute, controversy or claim shall be
decided by a sole arbitrator in accordance with the rules set forth in this
Article VII.
7.04 ARBITRATORS.
(a) Within 15 days after a valid Arbitration Demand Notice is given,
the parties involved in the dispute, controversy or claim referenced therein
shall attempt to select a sole arbitrator satisfactory to all such parties.
(b) In the event that such parties are not able jointly to select a
sole arbitrator within such 15-day period, such parties shall each appoint an
arbitrator (who need not be disinterested as to the parties or the matter)
within 30 days after delivery of the Arbitration Demand Notice. If one party
appoints an arbitrator within such time period and the other party or parties
fail to appoint an arbitrator within such time period, the arbitrator appointed
by the one party shall be the sole arbitrator of the matter.
(c) In the event that a sole arbitrator is not selected pursuant to
paragraph (a) or (b) above and, instead, two arbitrators are selected pursuant
to paragraph (b) above, the two arbitrators will, within 30 days after the
appointment of the later of them to be appointed, select an additional
arbitrator who shall act as the sole arbitrator of the dispute. After selection
of such sole arbitrator, the initial arbitrators shall have no further role with
respect to the dispute. In the event that the arbitrators so appointed do not,
within 30 days after the appointment of the later of them to be appointed, agree
on the selection of the sole arbitrator, any party involved in such dispute may
apply to CPR, New York, New York to select the sole arbitrator, which selection
shall be made by such organization within 30 days after such application. Any
arbitrator selected pursuant to this paragraph (c) shall be disinterested with
respect to any of the parties and the matter and shall be reasonably competent
in the applicable subject matter. In disputes involving the Tax Sharing
Agreement the arbitrator appointed shall be either a tax attorney or an
independent certified public accountant.
-32-
33
(d) The sole arbitrator selected pursuant to paragraph (a), (b) or (c)
above will set a time for the hearing of the matter which will commence no later
than 90 days after the date of appointment of the sole arbitrator pursuant to
paragraph (a), (b) or (c) above and which hearing will be no longer than 30 days
(unless in the judgment of the arbitrator the matter is unusually complex and
sophisticated and thereby requires a longer time, in which event such hearing
shall be no longer than 90 days). The final award of such arbitrator will be
rendered in writing to the parties not later than 60 days after the last hearing
date, unless otherwise agreed by the parties in writing.
(e) The place of any arbitration hereunder will be St. Louis, Missouri,
unless otherwise agreed by the parties.
7.05 HEARINGS. Within the time period specified in Section 7.04(d), the
matter shall be presented to the arbitrator at a hearing by means of written
submissions of memoranda and verified witness statements, filed simultaneously,
and responses, if necessary in the judgment of the arbitrator or both the
parties. The arbitrator shall actively manage the arbitration with a view to
achieving a just, speedy and cost-effective resolution of the dispute, claim or
controversy. The arbitrator may, in his or her discretion, set time and other
limits on the presentation of each party's case, its memoranda or other
submissions, and refuse to receive any proffered evidence which the arbitrator,
in his or her discretion, finds to be cumulative, unnecessary, irrelevant or of
low probative nature. Except as otherwise set forth herein, any arbitration
hereunder will be conducted in accordance with the CPR Rules for
Non-Administered Arbitration of Business Disputes then prevailing (except that
the fee schedule of CPR will not apply unless CPR selects the arbitrator in
which event the relevant CPR Fee Schedule will apply). Except as expressly set
forth in Section 7.08(b), the decision of the arbitrator will be final and
binding on the parties, and judgment thereon may be had and will be enforceable
in any court having jurisdiction over the parties. Arbitration awards will bear
interest from the date of the arbitration award at an annual rate of the Prime
Rate per annum. To the extent that the provisions of this Agreement and the
prevailing rules of the CPR conflict, the provisions of this Agreement shall
govern.
7.06 DISCOVERY AND CERTAIN OTHER MATTERS.
(a) In addition to its rights of access to Information under Article VI
of this Agreement and any other rights to Information provided for in this
Agreement or an Other Agreement, any party involved in the applicable dispute
may request limited document production from the other party or parties at any
time following the original meeting request of relevant documents containing
Information developed after the Distribution Date and which Information would
not otherwise be available under Article VI, with the reasonable expenses of the
producing party incurred in such production paid by the requesting party. Any
such discovery (which rights to documents shall be substantially less than
document discovery rights prevailing under the Federal Rules of Civil Procedure)
shall be conducted expeditiously and shall not cause the hearing provided for in
Section 7.05 to be adjourned except upon consent of all parties involved in the
applicable dispute or upon a showing of cause demonstrating that such
adjournment is necessary to permit discovery essential to a party to the
proceeding. Depositions, interrogatories or other forms of discovery (other than
the document production set forth above) shall not occur except by consent of
the parties involved in the applicable dispute. Disputes concerning the scope of
document production and enforcement of the document production requests will be
determined by written agreement of the parties involved in the applicable
dispute or, failing such agreement, will be referred to the arbitrator for
resolution. All discovery requests for Information developed after the
Distribution Date will be subject to the parties' rights to claim any applicable
privilege. In addition to the parties
-33-
34
confidentiality and restricted use obligations with respect to Information
contained in this Agreement or the applicable Other Agreement, the arbitrator
will adopt procedures to protect the proprietary rights of the parties and to
maintain the confidential treatment of the arbitration proceedings (except as
may be required by law). Subject to the foregoing, the arbitrator shall have the
power to issue subpoenas to compel the production of documents relevant to the
dispute, controversy or claim.
(b) The arbitrator shall have full power and authority to determine
issues of arbitrability but shall otherwise be limited to interpreting or
construing the applicable provisions of this Agreement or any Other Agreement,
and will have no authority or power to limit, expand, alter, amend, modify,
revoke or suspend any condition or provision of this Agreement or any Other
Agreement; it being understood, however, that the arbitrator will have full
authority to implement the provisions of this Agreement or any Other Agreement,
and to fashion appropriate remedies for breaches of this Agreement (including
interim or permanent injunctive relief); provided that the arbitrator shall not
have (1) any authority in excess of the authority a court having jurisdiction
over the parties and the controversy or dispute would have absent these
arbitration provisions or (2) any right or power to award punitive or treble
damages. It is the intention of the parties that in rendering a decision the
arbitrator give effect to the applicable provisions of this Agreement and the
Other Agreements and follow applicable law (it being understood and agreed that
this sentence shall not give rise to a right of judicial review of the
arbitrator's award).
(c) If a party fails or refuses to appear at and participate in an
arbitration hearing after due notice, the arbitrator may hear and determine the
controversy upon evidence produced by the appearing party.
(d) Arbitration costs will be borne equally by each party involved in
the matter, except that each party will be responsible for its own attorney's
fees and other costs and expenses, including the costs of witnesses selected by
such party. Provided, however, that if an arbitration or court action is
commenced without a meeting of or discussion between the CEO's, the party who
did not make its CEO available for such meeting or discussion will pay all costs
of the arbitration or litigation. In addition, the arbitrator (or the Court in
any action under Article 7.08 or any action to enforce the award) shall be
entitled in his or her discretion to award reasonable attorney's fees to the
prevailing party if the arbitrator (or the Court) finds that the other party did
not make its CEO available for a meeting and that party (a) has asserted claims
or defenses that are frivolous or (b) has unnecessarily and unreasonably
expanded the scope of the proceedings.
7.07 CERTAIN ADDITIONAL MATTERS.
(a) Any arbitration award shall be a bare award limited to a holding
for or against a party and shall be without findings as to facts, issues or
conclusions of law (including with respect to any matters relating to the
validity or infringement of patents or patent applications) and shall be without
a statement of the reasoning on which the award rests, but must be in adequate
form so that a judgment of a court may be entered thereupon. Judgment upon any
arbitration award hereunder may be entered in any court having jurisdiction
thereof.
(b) Prior to the time at which an arbitrator is appointed pursuant to
Section 7.04, any party may seek one or more temporary restraining orders in a
court of competent jurisdiction if necessary in order to preserve and protect
the status quo. Neither the request for, or grant or denial of, any such
temporary restraining order shall be deemed a waiver of the obligation to
arbitrate as set forth herein.
-34-
35
(c) Except as required by law, the parties shall hold, and shall cause
their respective officers, directors, employees, agents and other
representatives to hold, the existence, content and result of mediation or
arbitration in confidence in accordance with the provisions of Article VI and
except as may be required in order to enforce any award. Each of the parties
shall request that any mediator or arbitrator comply with such confidentiality
requirement.
(d) In the event that at any time the sole arbitrator shall fail to
serve as an arbitrator for any reason, the parties shall select a new arbitrator
who shall be disinterested as to the parties and the matter in accordance with
the procedures set forth herein for the selection of the initial arbitrator. The
extent, if any, to which testimony previously given shall be repeated or as to
which the replacement arbitrator elects to rely on the stenographic record (if
there is one) of such testimony shall be determined by the replacement
arbitrator.
7.08 LIMITED COURT ACTIONS.
(a) Notwithstanding anything herein to the contrary, in the event that
any party reasonably determines the amount in controversy in any dispute,
controversy or claim (or any series of related disputes, controversies or
claims) under this Agreement or any Other Agreement is, or is reasonably likely
to be, in excess of $10 million and if such party desires to commence an Action
in lieu of complying with the arbitration provisions of this Article, such party
shall so state in its Arbitration Demand Notice or by notice given to the other
parties within 20 days after receipt of an Arbitration Demand Notice with
respect thereto. If the other parties to the arbitration do not agree that the
amount in controversy in such dispute, controversy or claim (or such series of
related disputes, controversies or claims) is, or is reasonably likely to be, in
excess of $10 million, the arbitrator selected pursuant to Section 7.04 hereof
shall decide whether the amount in controversy in such dispute, controversy or
claim (or such series of related disputes, controversies or claims) is, or is
reasonably likely to be, in excess of $10 million. The arbitrator shall set a
date that is no later than ten days after the date of his or her appointment for
submissions by the parties with respect to such issue. Except for a party's
rights of access to Information as provided in this Agreement and the Other
Agreements, there shall not be any discovery in connection with such issue. The
arbitrator shall render his or her decision on such issue within five days of
such date so set by the arbitrator. In the event that the arbitrator determines
that the amount in controversy in such dispute, controversy or claim (or such
series of related disputes, controversies or claims) is or is reasonably likely
to be in excess of $10 million, the provisions of Sections 7.04(d) and (e),
7.05, 7.06, 7.07 and 7.10 hereof shall not apply and on or before (but, except
as expressly set forth in Section 7.08(b), not after) the tenth business day
after the date of such decision, any party to the arbitration may elect, in lieu
of arbitration, to commence an Action with respect to such dispute, controversy
or claim (or such series of related disputes, controversies or claims) in any
court of competent jurisdiction. If the arbitrator does not so determine, the
provisions of this Article VII (including with respect to time periods) shall
apply as if no determinations were sought or made pursuant to this Section
7.08(a).
(b) In the event that an arbitration award in excess of $10 million is
issued in any arbitration proceeding commenced hereunder, any party may, within
60 days after the date of such award, commence an Action in a court of competent
jurisdiction relating to the dispute, controversy or claim (or series of related
disputes, controversies or claims) giving rise thereto to a court of competent
jurisdiction, regardless of whether such party or any other party sought to
commence an Action in lieu of proceeding with arbitration in accordance with
Section 7.08(a). In such event, each party may present arguments to the court
with respect to whether
-35-
36
and to what extent the record developed in arbitration shall be admissible into
evidence and whether any such additional discovery or evidence shall be
permitted.
(c) No party shall raise as a defense the statute of limitations or
repose or a claim of laches if the applicable Notice of Escalation was delivered
on or prior to the applicable statute of limitations or repose or the time
period required to assert a claim of laches and, if applicable, if the matter is
submitted to a court of competent jurisdiction within the 60-day period
specified in Section 7.08(b).
7.09 CONTINUITY OF SERVICE AND PERFORMANCE. Unless otherwise agreed in
writing, the parties will continue to provide service and honor all other
commitments under this Agreement and each Other Agreement during the course of
dispute resolution pursuant to the provisions of this Article VII with respect
to all matters not subject to such dispute, controversy or claim.
7.10 LAW GOVERNING ARBITRATION PROCEDURES. The interpretation of the
provisions of this Article VII, only insofar as they relate to the agreement to
arbitrate and any procedures pursuant thereto, shall be governed by the
Arbitration Act and other applicable federal law. In all other respects, the
interpretation of this Agreement shall be governed as set forth in Section
10.04.
ARTICLE VIII
NO REPRESENTATIONS OR WARRANTIES; EXCEPTIONS
8.01 NO REPRESENTATIONS OR WARRANTIES; EXCEPTIONS. Chemicals
understands and agrees that no member of the Monsanto Group is, in this
Agreement or in any Other Agreement, representing or warranting to the Chemicals
Group in any way as to the Chemicals Assets, the Chemicals Liabilities, the
Chemicals Business, the Former Chemicals Business or the Chemicals Balance
Sheet, or as to any consents or approvals required in connection with the
consummation of the transactions contemplated by this Agreement, it being agreed
and understood as between the Groups, the members of the Chemicals Group shall
take all of the Chemicals Assets "as is, where is" and that, except as provided
in this Section 8.01 or in Section 5.01, the members of Chemicals Group shall
bear the economic and legal risk that conveyances of the Chemicals Assets shall
prove to be insufficient or that the title of any member of the Chemicals Group
to any Chemicals Assets shall be other than good and marketable and free from
encumbrances. Real property in the United States being transferred to Chemicals
will be conveyed by Special Warranty Deed, in recordable form and warranting
title to be free and clear from all lawful claims of those claiming by, through
or under Monsanto, but not otherwise; provided, however, such Special Warranty
Deed shall be subject to deed restrictions, easements, rights-of-way, and all
other matters of record.
-36-
37
ARTICLE IX
INSURANCE
9.01 INSURANCE POLICIES AND RIGHTS.
(a) Without limiting the generality of the definition of Chemicals
Assets set forth in Section 1.01 or the effect of Section 2.03, the Chemicals
Assets shall include any and all rights of an insured party, including rights of
indemnity and the right to be defended by or at the expense of the insurer with
respect to all Chemicals Claims, under any Insurance Policies; provided,
however, that nothing in this clause shall be deemed to constitute (or to
reflect) the assignment to Chemicals of any of the Insurance Policies. Except
for Insurance Proceeds paid to or on behalf of any member of the Monsanto Group
at the direction of Chemicals in satisfaction of a claim that would otherwise be
subject to indemnification by Chemicals under Article IV but subject to the
provisions of Section 4.03(c), and except for reimbursement received by Monsanto
for Chemicals Claims which are Monsanto Liabilities and were paid by the
Monsanto Group after the Distribution Date, Chemicals shall be entitled to
receive from the insurer or Monsanto any Insurance Proceeds with respect to any
Chemicals Claim under the Insurance Policies including without limitation,
reimbursement or payment for Chemicals Liabilities, for casualty or business
interruption with respect to the Chemicals Business or the Chemicals Assets, or
for costs or expenses related thereto.
(b) Without limiting the generality of the definition of Monsanto
Assets set forth in Section 1.01, the Monsanto Assets shall include any and all
rights of an insured party including rights of indemnity and the right to be
defended by or at the expense of the insurer, under any Insurance Policies other
than the rights under the Insurance Policies which are included in Chemicals
Assets pursuant to Section 9.01(a). Such rights include claims with respect to
the Joint Ownership Properties or the P4 Business to the extent of Monsanto's
rights or obligations under the P4 Joint Venture Agreement with respect to such
claims.
(c) Solely for purposes of this Article IX, "Monsanto Group" and
"Chemicals Group" shall include their consolidated entities to the extent such
entities were in existence as of the Distribution Date.
9.02 CLAIMS.
(a) The parties agree that on or prior to the Distribution Date,
Monsanto shall be deemed: (i) to have assigned to the Chemicals Group, without
need of further documentation, all of the Monsanto Group's rights, if any, as an
insured party, including rights of indemnity and the right to be defended by or
at the expense of the insurer, under all of the Insurance Policies with respect
to such Chemicals Claims as are pending on the Distribution Date, and (ii) to
the extent necessary to provide the Chemicals Group with the benefit of such
insurance with respect to Chemicals Claims, to designate Chemicals, without need
of further documentation, as the agent and attorney-in-fact to assert and to
collect any Insurance Proceeds under such Insurance Policies; provided, however,
that nothing in this Section 9.02 shall be deemed to constitute (or reflect) the
assignment of any of the Insurance Policies to the Chemicals Group. If,
subsequent to the Distribution Date, the Chemicals Group shall be entitled to
payment or reimbursement with respect to a Chemicals Claim or any Person shall
assert a Chemicals Claim, then Monsanto shall at the time such Chemicals Claim
arises or is asserted be deemed: (i) to assign, without need of further
documentation, to the Chemicals Group all of the Monsanto Group's rights, if
any, as an insured party, including rights of indemnity and the right to be
defended by or at the expense of the insurer, under the applicable
-37-
38
Insurance Policy with respect to such Chemicals Claim; and (ii) to the extent
necessary to provide the Chemicals Group with the benefit of such insurance with
respect to Chemicals Claims, to designate Chemicals, without need of further
documentation, as the agent and attorney-in-fact to assert and to collect any
Insurance Proceeds under such Insurance Policies, provided, however, that
nothing in this Section 9.02 shall be deemed to constitute (or to reflect) the
assignment of any of the Insurance Policies to the Chemicals Group. In the event
an insurer refuses to honor such agency or to pay such Insurance Proceeds to the
Chemicals Group, Monsanto shall collect such Insurance Proceeds and forward it
to Chemicals.
(b) In the event of payment of a Chemicals Claim by the
Chemicals Group after the Distribution Date or any payment of a Chemicals Claim
prior to the Distribution Agreement which is subject to reimbursement or payment
by an insurer or a Third Party, Chemicals, or the applicable member of the
Chemicals Group shall be subrogated to and stand in the place of Monsanto or the
Monsanto Group as to any rights, events or circumstances in respect of which
Chemicals or the applicable member of the Chemicals Group may have any right or
claim under this Agreement, any Other Agreement or otherwise against any such
insurer or Third Party relating to such Chemicals Claim. Monsanto shall
cooperate with the Chemicals Group in a reasonable manner in prosecuting any
subrogated right or claim, including granting Chemicals permission to xxx in the
name of Monsanto.
9.03 ADMINISTRATION AND RESERVES. Consistent with the
provisions of Article IV, from and after the Distribution Date:
(a) Monsanto shall be responsible for (1) Insurance
Administration of the Insurance Policies with respect to any Monsanto
Liabilities, any Monsanto Assets or any claims as to which the Monsanto
Group has retained rights of reimbursement or subrogation pursuant to
this Agreement or any Other Agreement; and (2) Claims Administration
with respect to any Monsanto Liabilities, any Monsanto Assets or any
claims as to which the Monsanto Group has retained rights of
reimbursement or subrogation pursuant to this Agreement or any Other
Agreement. It is understood that the retention of the Insurance
Policies by Monsanto is in no way intended to limit, inhibit or
preclude any right to insurance coverage for any Insured Claim or any
other rights under the Insurance Policies, including without
limitation, claims of Chemicals and any of its operations, Subsidiaries
and Affiliates for insurance coverage, reimbursement, subrogation or
otherwise; and
(b) Chemicals shall be responsible for (1) Insurance
Administration of the Insurance Policies with respect to any Chemicals
Liabilities, any Chemicals Assets, or any claims as to which the
Chemicals Group has rights of reimbursement or subrogation pursuant to
this Agreement or any Other Agreement, and (2) Claims Administration
with respect to any Chemicals Liabilities, any Chemicals Assets, or any
claims as to which the Chemicals Group has rights of reimbursement or
subrogation pursuant to this Agreement or an Other Agreement. Subject
to the terms of the Transition Services Agreement, Monsanto shall
perform the Insurance Administration and provide assistance to the
Chemicals Group with respect to Claims Administration for claims as to
which Chemicals or the Chemicals Group has rights or obligations
hereunder as part of the insurance and risk management services it will
perform for the Chemicals Group after the Distribution Date.
9.04 RETROSPECTIVELY RATED INSURANCE PREMIUMS. Each party
shall pay its share of retrospectively rated premiums incurred after the
Distribution Date for coverage under the Insurance Policies with respect to
their respective Liabilities which are Insured Claims under the
-38-
39
Insurance Policies. Such shares will be determined consistent with the
accounting principle in effect on the Distribution Date which was used to
determine shares of such retrospectively rated premiums prior thereto. Either
party shall have the right but not the obligation to pay such premiums under the
Insurance Policies with respect to the other party's Liabilities which are
Insured Claims under the Insurance Policies to the extent that such other party
does not pay such premiums, whereupon the non-paying party shall forthwith
reimburse the payor for any premiums paid by the payor with respect to such
non-paying party's Liabilities.
9.05 ALLOCATION OF INSURANCE PROCEEDS; COOPERATION. (a) Except as
otherwise provided in Section 4.03(c), Insurance Proceeds received with respect
to claims, costs and expenses under the Insurance Policies shall be paid to
Monsanto with respect to Monsanto Liabilities and to Chemicals with respect to
the Chemicals Liabilities. Payment of the allocable portions of indemnity costs
of Insurance Proceeds resulting from the Insurance Policies will be made to the
appropriate party upon receipt from the insurance carrier.
(b) Each of the parties hereto agree to use commercially
reasonable efforts to maximize available coverage under the Insurance Policies
for all Insured Claims whether or not such party is the expected beneficiary of
Insurance Proceeds under such Insurance Policies in respect of such Insured
Claim. As part of such efforts to maximize insurance coverage, each party agrees
to take all commercially reasonable steps to recover such amounts as are or
might be due from all other responsible parties in respect of an Insured Claim,
including but not limited to Insured Claims as to which coverage limits under
the Insurance Policies would be or would have been exceeded as a result of such
Insured Claim and whether or not such party is expected to benefit directly from
such efforts.
(c) Where Monsanto Liabilities and Chemicals Liabilities, as
applicable, are covered under the same Insurance Policies for periods prior to
the Distribution Date, or covering claims made after the Distribution Date with
respect to an event or an occurrence prior to the Distribution Date, then the
Monsanto Group and the Chemicals Group may claim coverage for Insured Claims
under such Insurance Policies as and to the extent that such insurance is
available up to the full extent of the applicable limits of liability or other
coverage of such Insurance Policies. Each party may receive Insurance Proceeds
in respect of its Insured Claims as and when payable under the terms of the
applicable Insurance Policies without regard to whether the Insured Claim covers
a Monsanto Liability or claim or a Chemicals Liability or claim, the relative
amount of deductible paid by either party after the Distribution Date with
respect to an Insured Claim for a Liability for which such party was responsible
or the amount of such Insurance Proceeds paid to either Group after the
Distribution Date with respect to its respective Liabilities. In the event that
the aggregate limits on any Insurance Policy is exceeded by the aggregate of
paid Insured Claims, there shall be no further allocation of previously paid
deductibles, premiums or Insurance Proceeds between the Groups and except as
expressly provided in this Agreement, neither Group shall be entitled to
reimbursement from the other Group for deductibles, premiums or Insurance
Proceeds paid by an insurer to or on behalf of such Group; provided, however,
that in the event additional insurance coverage for remaining unpaid Insured
Claims may be purchased or reinstated, the parties agree to share such costs of
reinstatement (including premium penalty adjustments) in the same proportion
which the Insurance Proceeds under such Insurance Policy (both received and
expected to be received by such party after the Distribution Date less
deductible paid by such party after the Distribution Date) bears to the total
Insurance Proceeds paid (and payable to the party with the pending claims under
the new coverage limits).
9.06 REIMBURSEMENT OF EXPENSES. Chemicals shall reimburse the relevant
insurer or the relevant third-party administrator, to the extent required under
any Insurance Policy or Service Agreement for any services performed after the
Distribution Date with respect to any and
-39-
40
all Chemicals Claims which are not Monsanto Liabilities which are paid, settled,
adjusted, defended and/or otherwise handled by such insurer or third-party
administrator pursuant to the terms and conditions of such Insurance Policy or
Service Agreement.
9.07 INSURER INSOLVENCY. Except for Chemicals Claims which are Monsanto
Liabilities or as otherwise provided in this Agreement, the Monsanto Group shall
not be obligated to reimburse the Chemicals Group for any Chemicals Claim
covered under any Insurance Policies which is not paid because of the insolvency
of such insurer or the refusal by any insurer to pay such Chemicals Claim;
provided, however, that Monsanto shall assign to Chemicals or any member of the
Chemicals Group all of its rights under such Insurance Policies with respect to
such Chemicals Claim and shall cooperate with Chemicals, at Chemicals' option
and expense, in pursuing collection of all or part of such Chemicals Claim from
such insurer or such other Third Parties who may have liability for such
Chemicals Claim (including without limitation, Governmental Authorities, or
others holding insurance reserves available for payment, trustees in bankruptcy
or liquidators of such insurers, etc.).
9.08 DIRECT RESPONSIBILITY FOR CLAIMS. Monsanto agrees to notify
insurers under the Insurance Policies of the Distribution and to seek an
endorsement by such insurers that the coverage provided by such Insurance
Policies will apply to the Monsanto Group and the Chemicals Group with the same
force and effect and subject to the same terms, conditions, and exclusions as if
the separation of Monsanto and the Distribution had not occurred. In the event
such endorsement is refused, Monsanto agrees to take such action as is necessary
to place the Chemicals Group in the same position as it would have been had such
endorsement been agreed upon by such insurers. Chemicals shall have the right to
make reasonable efforts to negotiate agreements with any and all insurers or
third-party administrators whereby Chemicals shall assume direct responsibility
for any and all Liabilities related to it under any Insurance Policies and/or
Service Agreements, and Monsanto shall provide reasonable assistance in this
effort.
9.09 NO REDUCTION OF COVERAGE. Except for such reduction in coverage
resulting from payment of claims paid in accordance with this Agreement or any
Other Agreement, neither party shall take any action to eliminate or reduce
coverage under any Insurance Policy or Service Agreement for any claims without
the prior written consent of the other party (which shall not be unreasonably
withheld or delayed).
9.10 ASSISTANCE, WAIVER OF CONFLICT AND SHARED DEFENSE. Each of the
parties hereto agrees to provide reasonable assistance to the other parties
hereto as regards any dispute with any third party (including insurers,
third-party administrators and state guaranty funds) as to any matter related to
the Insurance Policies or Service Agreements. In the event that Insured Claims
of more than one Group exist relating to the same occurrence, the parties hereto
agree to defend such Insured Claims jointly and to waive any conflict of
interest necessary to the conduct of such joint defense. Nothing in this Section
9.10 shall be construed to limit or otherwise alter in any way the indemnity
obligations of the parties hereto, including those created by this Agreement or
by operation of law.
-40-
41
ARTICLE X
MISCELLANEOUS
10.01 CONDITIONS TO OBLIGATIONS.
(a) The obligations of the parties hereto to consummate the
Distribution are subject to the satisfaction, as determined by Monsanto in its
sole discretion, of each of the following conditions:
(1) The Distribution shall have been approved by the holders
of a majority of the shares of Monsanto Common Stock present in person
or by proxy at the Special Meeting;
(2) The Monsanto Certificate Amendment shall have been
approved by the holders of a majority of the outstanding shares of
Monsanto Common Stock;
(3) The transactions contemplated by Sections 2.01, 2.02, 2.05
and 2.06 shall have been consummated and the transactions contemplated
by Section 2.03 shall have been consummated in all material respects;
(4) The Chemicals Common Stock shall have been approved for
listing on the NYSE, subject to official notice of issuance;
(5) The Registration Statement shall have been filed with the
SEC and shall have become effective, and no stop order with respect
thereto shall be in effect;
(6) All material authorizations, consents, approvals and
clearances of federal, state, local and foreign governmental agencies
required to permit the valid consummation by the parties hereto of the
transactions contemplated by this Agreement shall have been obtained;
and no such authorization, consent, approval or clearance shall contain
any conditions which would have a material adverse effect on (A) the
Monsanto Business or the Chemicals Business, (B) the Assets, results of
operations or financial condition of the Monsanto Group or the
Chemicals Group, in each case taken as a whole, or (C) the ability of
Monsanto or Chemicals to perform its obligations under this Agreement;
and all statutory requirements for such valid consummation shall have
been fulfilled.
(7) No preliminary or permanent injunction or other order,
decree or ruling issued by a court of competent jurisdiction or by a
government, regulatory or administrative agency or commission, and no
statute, rule, regulation or executive order promulgated or enacted by
any governmental authority, shall be in effect preventing the
consummation of the Distribution;
(8) The Financing Facility shall be in place and all
conditions to borrowing thereunder (other than any conditions
concerning consummation of the Distribution and the transfers of assets
and liabilities described hereunder) shall have been satisfied, and all
necessary consents, waivers or amendments to each bank credit
agreement, debt security or other financing facility to which any
member of the Monsanto Group or the Chemicals Group is a party or by
which any such member is bound shall have been obtained, or each such
agreement, security or facility shall have been refinanced, in each
case on terms satisfactory to Monsanto and to the extent necessary to
permit the Distribution to be consummated without any material breach
of the terms of such agreement, security or facility; and
-41-
42
(9) Monsanto shall have received a ruling from the Internal
Revenue Service that the Distribution is tax-free for federal income
tax purposes, and such ruling shall be in form and substance
satisfactory to Monsanto in its sole discretion.
(b) The foregoing conditions are for the sole benefit of Monsanto and
shall not give rise to any duty on the part of Monsanto or its Board of
Directors to waive or not waive any such condition. Any determination made by
the Board of Directors of Monsanto in good faith on or prior to the Distribution
Date concerning the satisfaction or waiver of any or all of the conditions set
forth in Section 10.01(a) shall be conclusive.
10.02 COMPLETE AGREEMENT. This Agreement, the Exhibits and
Schedules hereto, the Other Agreements and the agreements and other documents
referred to herein shall constitute the entire agreement between the parties
hereto with respect to the subject matter hereof and shall supersede all
previous negotiations, commitments and writings with respect to such subject
matter, including without limitation, the "Spin Principles".
10.03 EXPENSES. All costs and expenses of any party hereto
whether incurred prior to or after the Distribution Date in connection with the
preparation, execution, delivery and implementation of this Agreement and with
the consummation of the transactions contemplated by this Agreement and the
Other Agreements, including but not limited to legal fees, accounting fees,
investment banking fees, and all such other costs and expenses shall be charged
to and paid by Monsanto. Monsanto will contribute to Chemicals all intangible
assets relating to Chemicals' investigatory, pre-opening, start-up and
organizational expenditures which are required to be capitalized for federal
income tax purposes.
10.04 GOVERNING LAW. This Agreement 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.
10.05 NOTICES. All notices, requests, claims, demands and
other communications hereunder (collectively, "Notices") shall be in writing and
shall be given (and shall be deemed to have been duly given upon receipt) by
delivery in person, by cable, telegram, facsimile, electronic mail or other
standard form of telecommunications (provided confirmation is delivered to the
recipient the next Business Day in the case of facsimile, electronic mail or
other standard form of telecommunications) or by registered or certified mail,
postage prepaid, return receipt requested, addressed as follows:
If to Monsanto:
with a copy to: General Counsel
D Building
Monsanto Company
000 Xxxxx Xxxxxxxxx Xxxxxxxxx
Xx. Xxxxx, XX 00000
Telephone:
Facsimile:
-42-
43
If to Chemicals: President
G Building
[New Chemicals Corporation]
00000 Xxxxx Xxxxxxxxx
X.X. Xxx 00000
Xx. Xxxxx, XX 00000-0000
Telephone: 000-000-0000
Facsimile: 314-674-
with a copy to: General Counsel
G Building
[New Chemicals Corporation]
00000 Xxxxx Xxxxxxxxx
Xx. Xxxxx, XX 00000-0000
Telephone: 000-000-0000
Facsimile: 000-000-0000
or to such other address as any party hereto may have furnished to the other
parties by a notice in writing in accordance with this Section 10.05.
10.06 AMENDMENT AND MODIFICATION. This Agreement may be
amended, modified or supplemented only by a written agreement signed by both of
the parties hereto.
10.07 SUCCESSORS AND ASSIGNS; NO THIRD PARTY BENEFICIARIES.
This Agreement 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 Agreement 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). Except for the provisions of Sections 4.03 and 4.04 relating to
Indemnities, which are also for the benefit of the Indemnitees, this Agreement
is solely for the benefit of the parties hereto and their Subsidiaries and
Affiliates and is not intended to confer upon any other Persons any rights or
remedies hereunder.
10.08 COUNTERPARTS. This Agreement 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.
10.09 INTERPRETATION. The Article and Section headings
contained in this Agreement are solely for the purpose of reference, are not
part of the agreement of the parties hereto and shall not in any way affect the
meaning or interpretation of this Agreement.
10.10 LEGAL ENFORCEABILITY. Any provision of this Agreement
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 Agreement and agrees that the obligations of the parties
hereunder shall be specifically enforceable.
10.11 REFERENCES; CONSTRUCTION. References to any "Article",
"Exhibit", "Schedule" or "Section", without more, are to Appendices, Articles,
Exhibits, Schedules and Sections to or of this Agreement. Unless otherwise
expressly stated, clauses beginning with the
-43-
44
term "including" set forth examples only and in no way limit the generality of
the matters thus exemplified.
10.12 TERMINATION. Notwithstanding any provision hereof this
Agreement may be terminated and the Distribution abandoned at any time prior to
the Distribution Date by and in the sole discretion of the Board of Directors of
Monsanto without the approval of any other party hereto or of Monsanto's
stockholders. In the event of such termination, no party hereto shall have any
Liability to any Person by reason of this Agreement.
-44-
45
IN WITNESS WHEREOF, the parties hereto have caused this
Agreement to be duly executed as of the date first above written.
MONSANTO COMPANY,
a Delaware corporation
By: _____________________________
[CHEMICALS],
a Delaware corporation
By: _____________________________
-45-
