Exhibit 10.4
M O N S A N T O [LOGO]
Food.Health.Hope
MONSANTO COMPANY
000 Xxxxx Xxxxxxxxx Xxxx
Xx. Xxxxx, Xxxxxxxx 00000
xxxx://xxx.xxxxxxxx.xxx
July 13, 2000
Xxxxx X. XxXxx
00000 Xxxx Xxxxxxx Xxxxx
Xxxxxxxxxx, XX 00000-0000
Dear Xxxxx:
This letter agreement (this "Agreement") is to confirm the mutual agreement of
the parties with respect to the terms and conditions under which you will
provide consulting services to Monsanto Company (the "Company"), which is
currently a wholly-owned subsidiary of Pharmacia Corporation ("Pharmacia"). The
Company has filed a registration statement relating to a proposed initial public
offering of its shares (the "IPO"). This Agreement is not conditioned upon
consummation of the IPO.
1. Chairmanship. Effective June 20, 2000, you were appointed as a member of the
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Board of Directors of the Company (the "Board"), Chairman of the Board and
Chairman of the Executive Committee of the Board. Pharmacia shall vote its
shares of the Company in favor of your re-election to successive terms as a
member of the Board until the annual meeting of the shareholders of the Company
occurring in 2003 (the "2003 Annual Meeting"). You shall receive for your
serving in these capacities the compensation provided to all members of the
Board, together with such special fees as may be provided for serving as
Chairman of the Board and as Chairman of the Executive Committee and of any
other committees of the Board to which you may be appointed.
2. Consulting Services. You hereby agree to provide such consulting services
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("Consulting Services"), including advice regarding policies, long-term
strategies and general business issues relating to the Company and its industry,
as the Board or the Chief Executive Officer of the Company may reasonably
request from time to time.
3. Consulting Term. Unless extended by written agreement between you and the
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Company or unless earlier terminated in accordance with the provisions of this
Agreement, the term during which you shall provide Consulting Services under
this Agreement (the "Consulting Term") shall commence on June 20, 2000, and
terminate on the date of the 2003 Annual Meeting. The Company or you shall have
the right to terminate the Consulting Term immediately upon written notice to
the other party. Except as provided below, in the event of such a termination of
the Consulting Term, the Company's sole liability shall be to make the payments
due pursuant to
paragraph 4 hereof for Consulting Services provided by you prior to the
effective date of such termination and for which payment has not already been
made. If the Consulting Term is terminated by the Company other than as the
result of or in connection with the breach by you of any of your obligations
under this Agreement, or if you should die or become unable to render the
Consulting Services because of your permanent disability, then the Company shall
also pay you (or your designated beneficiary, or if you have not designated a
beneficiary, your estate) the Consulting Fees that would have been credited to
the Account pursuant to paragraph 4 hereof through the date of the 2003 Annual
Meeting (calculated taking into account such Retainer Amounts (as defined in
Section 4(c) below) as are reasonably projected to be paid to you), in a single
lump sum amount.
4. Consulting Fee. (a) As compensation for your Consulting Services, the Company
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shall pay you the fees provided for in this paragraph 4 (the "Consulting Fees").
A Consulting Fee of $33,334 per month, less the Retainer Amounts, shall be
credited to a bookkeeping account in your name (the "Account"), monthly in
arrears during the Consulting Term. The amounts credited to the Account shall
bear interest at the Xxxxx'x Baa Bond Index Rate, as in effect from time to
time. The balance in the Account shall be paid to you promptly following the
termination of the Consulting Term for any reason. Notwithstanding the
foregoing, if you and the Company so agree, the Account may be transferred to
and governed by the terms and conditions for deferral under any plan relating to
non-employee director compensation that may hereafter be adopted by the Company.
(b) In addition, the Company shall reimburse you for your customary and
reasonable out-of-pocket expenses incurred in performing the Consulting
Services, upon presentation of appropriate documentation hereof.
(c) The "Retainer Amounts" means the cash value of all regular fees paid to you
for your services as a member of the Board, Chairman of the Board and Chairman
of the Executive Committee and of any other committees of the Board to which you
may be appointed, including regular meeting fees and fees for serving as
chairman of any committees, whether paid to you in cash, stock, or stock
options, and whether or not payment or delivery thereof is deferred; provided,
that the Retainer Amounts shall not include the value of any stock options
granted to you as a "founders' grant" nor any expense reimbursements you may
receive. The value of any such regular fees that are not paid in cash shall be
determined at the time the relate award is granted (e.g., upon grant of a right
to receive deferred stock). The value of any such regular fees that are to be
paid in cash but on a deferred basis shall be determined based upon the
principal amount thereof, without regard to the interest or other earnings that
may be accrued thereon during the deferral period.
5. Confidentiality. In rendering your services hereunder, you may have acquired
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or may acquire from the Company or may develop certain information and data
which the Company wishes to keep confidential, including, but not limited to,
any information regarding the Company's products, projects, business, plans,
programs, plants, processes, equipment, costs, customers and operations and
information which the Company has obtained from third parties and with respect
to which the Company is obligated to maintain confidentiality (collectively,
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"Company Information"). You shall not disclose any Company Information to third
parties or use any Company Information (other than in connection with performing
your obligations under this Agreement or as a member of the Board), without in
each instance securing the prior written consent of the Company. All notes,
memoranda, records, tapes, printouts and other documents (including, but not
limited to, all electronic versions, drafts, copies and excerpts thereof)
embodying or referring to the Company Information or supplied to you by the
Company (collectively, "Documents") shall be the property of the Company and
shall be subject to this Agreement. The Company shall be free to use all
Documents in its business. All Documents shall be delivered or returned to the
Company immediately after termination of your services hereunder for any reason,
provided, however, that you may retain one archival copy of all reports
delivered to the Company and of all working papers necessary to support your
analyses, conclusions and recommendations. You further agree to indemnify the
Company for any losses, damages, liabilities, costs or expenses (including
attorneys' fees) incurred by unauthorized use or disclosure by you of any
Company Information or any breach of the provisions of this paragraph.
6. Independent Contractor. In performing your services hereunder, your status
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shall be that of an independent contractor and not that of an employee or
part-time employee of the Company. You acknowledge that you are responsible for
all taxes with respect to the compensation payable to you hereunder.
7. Governing Law. The validity, interpretation and performance of this
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Agreement and any dispute connected herewith shall be governed by and construed
in accordance with the laws of the state of Missouri (except its laws and
decisions regarding conflicts of law, which shall be disregarded in their
entirety).
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If the foregoing terms and conditions are acceptable to you, please indicate
your acceptance and agreement by executing this Agreement in triplicate at the
place indicated below and returning two copies to the Company. The other copy is
for your files.
Very truly yours,
MONSANTO COMPANY
/s/ Xxxxxxx X. Xxxxxxxxxx
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By: Xxxxxxx X. Xxxxxxxxxx
Title: Chief Executive Officer
PHARMACIA CORPORATION
/s/ Xxxx Xxxxxx
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By: Xxxx Xxxxxx
Title: Chief Executive Officer
AGREED TO AS OF THE DATE
FIRST ABOVE WRITTEN:
/s/ Xxxxx X. XxXxx
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Xxxxx X. XxXxx
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