Exhibit 10.2

 

Redacted Version

 

THIS IS AN AMENDMENT, effective                     , to the Monsanto/Paradigm
Genetics Collaboration Agreement dated as of November 17, 1999, and amended May
10, 2000, August 30, 2001, September 23, 2002, and January 28, 2003 (the
“Agreement”) by and between Paradigm Genetics, Inc., a Delaware corporation,
having a principal place of business at 108 Alexander Drive, Building 1A, P.O.
Box 14528, Research Triangle Park, North Carolina 27709-4528 (“Icoria”) and
Monsanto Company, a Delaware corporation, having a principal place of business
at 800 N. Lindbergh Blvd., St. Louis, Missouri 63167 (“Monsanto”).

 

WHEREAS, the parties have agreed to modify the Agreement as set forth herein
(the “Amendment”);

 

WHEREAS the parties are entering into an Asset Purchase Agreement as of the same
date as this Amendment;

 

WHEREAS the parties agree and acknowledge that there is a substantial
uncertainty related to whether any future royalty payments will be owed by
Monsanto to Icoria pursuant to the Agreement, and, in addition, even if a future
royalty will be paid, it is also uncertain as to the timing and amount of the
royalty payment, and as a result of such uncertainties, have agreed to the lump
sum Royalty Buyout Payment pursuant to Section 4.2 below;

 

NOW, THEREFORE, in consideration of the mutual covenants and agreements
hereinafter set forth, the parties agree as follows:

 

ARTICLE I

 

1.1 In August, 2004, Paradigm Genetics, Inc., changed its name to Icoria, Inc.,
and shall hereafter be referred to as Icoria in this Amendment.

 

1.2 Other than as amended herein, the Agreement shall remain in full force and
effect.

 

1.3 In the event of a conflict of provisions between this Amendment and the
Asset Purchase Agreement, the Asset Purchase Agreement shall control.

 

ARTICLE II

LICENSES

 

2.1 Paragraph 2.3 of the Agreement shall be amended to read as follows:

 

2.3 License to Monsanto: Icoria Gene Patent Rights

 

Subject to the terms and conditions of this Agreement and for the consideration
as set forth in the Asset Purchase Agreement, Icoria hereby grants to Monsanto,
Subsidiaries of Monsanto and wholly-owned Affiliates of Monsanto under Icoria’s
interest in the Icoria Gene Patent Rights and for the life of such Icoria Gene
Patent Rights

 

Portions of this Exhibit were omitted and have been filed separately with the
Secretary of the Commission pursuant to the Company’s application requesting
confidential treatment under Rule 24b-2 of the Securities Exchange Act of 1934,
as amended.

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Redacted Version

 

a perpetual exclusive, world-wide license to make and use Project Technology and
Monsanto DNA Information and a perpetual exclusive, world-wide license to
develop, make, have made, import, use, sell, have sold, and offer to sell
Monsanto Licensed Products. Icoria further grants Monsanto the right to
sublicense any of the above rights.

 

2.2 Paragraph 2.4 of the Agreement shall be deleted in its entirety and the
restrictions provided therein shall be considered to be removed.

 

2.3 Paragraph 2.8 of the Agreement shall be amended to read as follows:

 

  2.8 License to Icoria: research license - Project Technology

 

Monsanto grants Icoria and those Subsidiaries of Icoria at the Effective Date of
this Agreement under Monsanto’s interest in Licensed Patent Rights except for
those patent rights directed to DNA other than Arabidopsis DNA and Project
Technology a non-exclusive, world-wide license to use Project Technology and
Monsanto DNA Information directed to Arabidopsis DNA for research purposes only
and only to the extent required for conducting work contemplated by the Excluded
Contracts (defined in the Asset Purchase Agreement) as of the Closing Date of
the Asset Purchase Agreement, and such license shall remain in effect until the
earlier of (1) the date of termination of the last to terminate of the Excluded
Contracts or (2) December 31, 2006. This license may not be amended, altered,
extended or expanded in any way by means of any amendment to any such Excluded
Contract after the Closing Date of the Asset Purchase Agreement. Such right
shall not extend to any other Monsanto owned or inlicensed technology, including
Monsanto DNA Information that is not from Arabidopsis except as set forth in
Article 2.9.

 

2.4 Paragraph 2.9 of the Agreement shall be amended to read as follows:

 

2.9 License to Icoria: research license - Monsanto Enabling Technology in
research crops

 

Monsanto grants Icoria and Subsidiaries of Icoria under Monsanto’s interest in
Monsanto Enabling Technology a, nonexclusive, U.S. and Europe only, license to
use Monsanto Enabling Technology in Arabidopsis and tobacco for research
purposes only and only to the extent required for conducting work contemplated
by the Excluded Contracts (defined in the Asset Purchase Agreement) as of the
Closing Date of the Asset Purchase Agreement, and such license shall remain in
effect until the earlier of (1) the date of termination of the last to terminate
of the Excluded Contracts or (2) December 31,

 

Portions of this Exhibit were omitted and have been filed separately with the
Secretary of the Commission pursuant to the Company’s application requesting
confidential treatment under Rule 24b-2 of the Securities Exchange Act of 1934,
as amended.

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Redacted Version

 

2006. This license may not be amended, altered, extended or expanded in any way
by means of any amendment to any such Excluded Contract after the Closing Date
of the Asset Purchase Agreement. Such right shall not extend to any other
Monsanto owned or in-licensed technology, whether or not licensed to Icoria
herein, except and to the extent as set forth in Article 2.8. Notwithstanding
the foregoing, such research license shall not apply to research in herbicide
resistance in any plant species.

 

2.5 Paragraph 2.12 of the Agreement shall be deleted in its entirety and the
licenses granted therein shall be considered terminated.

 

ARTICLE III

FUNDED PROGRAM

 

3.1 The Project Plan shall be completed as provided in the Agreement as amended
by the milestone table in attached Exhibit 1. Exhibit 1 describes targets for
Pending Constructs as of May 2, 2005 and Completed Constructs for all of Q21 and
through May 2, 2005. With regard to a particular assay, a Pending Construct
shall be defined as a Construct on which work for that particular assay has been
initiated as of May 2, 2005, and has been sustained and maintained according to
the Project Plan of the Agreement so as to allow for satisfactory and timely
completion of that assay, but for which assay completion has not yet occurred.

 

3.2 From the execution of this Amendment until May 2, 2005, the Project
Committee shall hold a weekly conference call which shall provide a technical
update on the progress towards the milestone table in Exhibit 1. Between May 2
and May 7, the Project Committee, or any appointed representatives thereof,
shall meet at Icoria to review and confirm the results achieved by Icoria on May
2, 2005.

 

3.3 The Project Plan shall be considered to be satisfactorily completed if all
of the following targets are met:

 

  3.3.1 Pending Constructs: For Pending Constructs, the target shall be
considered met if the totals for Phase 1 ([****]) and Phase 2 ([***]) have been
met, provided that no individual assay total can contribute more than
[********************] percent ([***]%) of its target amount towards the Pending
Constructs total. For example, only [**] Salt assays can be counted towards the
Phase 1 total ([***]% of [**]).

 

  3.3.2 Completed Constructs: With respect to Completed Constructs, the target
for Phase 1 assays shall be considered met in full if the sum of the variations
from the target amounts for each of the ten (10) individual Phase 1 assays is
less than, or equal to, [****] percent ([**]%). In the event that the sum of
such variations is greater than [****] percent ([**]%) but less than, or equal
to, [*******] percent ([**]%), then such target shall be considered partially
met, and the payment under Section 4.1 of this Amendment shall be reduced

 

Portions of this Exhibit were omitted and have been filed separately with the
Secretary of the Commission pursuant to the Company’s application requesting
confidential treatment under Rule 24b-2 of the Securities Exchange Act of 1934,
as amended.

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Redacted Version

 

by [******************] dollars ($[*******]). In the event that the sum of such
variations is greater than [********] percent ([**]%), then such target shall be
considered unmet, and Monsanto shall not be required to make any payment under
the provisions of Section 4.1 of this Amendment. With respect to Completed
Constructs, the target for Phase 2 assays shall be considered met in full if the
variation from the target amount for total Phase 2 assays is less than, or equal
to, [*****] percent ([**]%). With respect to calculating the sum of the
variations from the target amount for Phase 1 assays, excess amounts over the
target amount for any individual assay (as presented in Exhibit 1) shall not be
considered in determining the respective variations. No accumulated credits or
any other consideration for constructs completed prior to Quarter 21 of the
Agreement shall be applied toward calculation of the numbers of Completed
Constructs in Exhibit 1. An example of the calculation for Completed Constructs
is provided in Exhibit 2. In that Exhibit, the sum of the variation from the
target amounts for Phase 1 (excluding excess amounts over the target) is [**]%,
and the sum of the variation from the target amount for Phase 2 is [*]%.
Therefore, in Exhibit 2, the target is considered met.

 

ARTICLE IV

PAYMENTS

 

4.1 Pending confirmation by the Project Committee of satisfactory completion of
the Project Plan as of May 2, 2005 as described in Exhibit 1, Monsanto shall
make a final payment to Icoria of
[*****************************************************************************]
dollars ($[*********]), subject to any applicable reduction as provided in
Section 3.3.2 of this Amendment, which payment shall be the last payment under
the Agreement, the Agreement shall be considered as paid-in-full. The payment
will be made on May 9, 2005 by wire transfer using the following instructions:

 

Account Name: Icoria, Inc.

Bank Name: Silicon Valley Bank

Bank Address: Atlanta, GA

Routing Number: ******

Account Number: ******

 

If the targets for either Completed Constructs or Pending Constructs is not
achieved by May 2, 2005, as described above, then no payment shall be made.

 

Portions of this Exhibit were omitted and have been filed separately with the
Secretary of the Commission pursuant to the Company’s application requesting
confidential treatment under Rule 24b-2 of the Securities Exchange Act of 1934,
as amended.

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Redacted Version

 

4.2 Paragraph 4.2.4 shall be amended as follows:

 

Monsanto may, at its sole option, at any time prior to November 30, 2008, elect
to pay to Icoria a one-time lump sum payment of [*********] dollars
($[*********] USD) (the “Royalty Buyout Payment”) as consideration to forever
terminate and discharge its obligations to pay any and all royalties due to
Icoria pursuant to Section 4.2 and Section 4.3 of the Agreement or any other
section there under, accruing on or after the date the Royalty Buyout Payment is
received by Icoria. The Royalty Buyout Payment shall not be adjusted for
inflation or other future value considerations.

 

Portions of this Exhibit were omitted and have been filed separately with the
Secretary of the Commission pursuant to the Company’s application requesting
confidential treatment under Rule 24b-2 of the Securities Exchange Act of 1934,
as amended.

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Redacted Version

 

IN WITNESS WHEREOF, each of the parties hereto has caused this Agreement to be
executed as of the date first above written.

 

MONSANTO COMPANY

By:

 

 

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Name:

 

 

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Title:

   

ICORIA, INC.

By:

 

 

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Name:

 

 

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Title:

   

 

Portions of this Exhibit were omitted and have been filed separately with the
Secretary of the Commission pursuant to the Company’s application requesting
confidential treatment under Rule 24b-2 of the Securities Exchange Act of 1934,
as amended.

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Redacted Version

 

EXHIBIT 1

 

     ASSAY

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Pending Construct

Target

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Completed Construct

Target

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     [********]   [***]   [***]      [*****]   [***]   [***]      [*******]  
[**]   [***]      [**********]   [***]   [***]

PHASE 1

   [****]   [**]   [***]      [****]   [**]   [***]      [*****]   [**]   [***]
     [********]   [**]   [***]      [***]   [**]   [***]      [*]   [***]  
[***]      Total Phase 1   [****]          [********]   [**]          [*****]  
[**]    

PHASE 2

   [******]   [***]              [***]   [****]

 

Portions of this Exhibit were omitted and have been filed separately with the
Secretary of the Commission pursuant to the Company’s application requesting
confidential treatment under Rule 24b-2 of the Securities Exchange Act of 1934,
as amended.

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Redacted Version

 

Pipeline Status as of May 2, 2005

 

    Assa

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     Pendin
Construct

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  Construct

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    [*********]      [***]   [***]     [*****]      [***]   [***]    
[*********]      [**]   [***]     [*********]      [***]   [***] PHASE 1  
[****]      [**]   [***]     [****]      [**]   [***]     [*****]      [**]  
[***]     [*********]      [**]   [***]     [***]      [**]   [***]     [*]     
[***]   [***]     Total      [****]         [*********]      [****]     PHASE 2
  [*****]      [****]         [******]      [***]         Total      [***]  
[****]

 

Portions of this Exhibit were omitted and have been filed separately with the
Secretary of the Commission pursuant to the Company’s application requesting
confidential treatment under Rule 24b-2 of the Securities Exchange Act of 1934,
as amended.

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Redacted Version

 

EXHIBIT 2

 

     ASSAY

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Completed
Construct

Target

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Completed
Construct

Actual

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  Percent
Variation

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     [********]   [***]   [***]   [*]      [****]   [***]   [***]   [*]     
[********]   [***]   [***]   [*]

PHASE 1

   [**********]   [***]   [***]   [*]      [****]   [***]   [***]   [*]     
[****]   [***]   [***]   [*]      [*****]   [***]   [***]   [*]      [********]
  [***]   [***]   [*]      [***]   [***]   [***]   [***]      [*]   [***]  
[***]   [****]      Total Phase 1           [**]%

PHASE 2

   Total Phase 2   [****]   [****]   [*]%

 

Portions of this Exhibit were omitted and have been filed separately with the
Secretary of the Commission pursuant to the Company’s application requesting
confidential treatment under Rule 24b-2 of the Securities Exchange Act of 1934,
as amended.

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Redacted Version

 

     Assa

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Contractur

% for

assa

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  Targe

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Actual

Delivere

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%

Delivere

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         [*********]   [****]   [***]   [***]   [****]   Total % payment
normally [****] EXAMPLE for Complete Construct    [*****]   [****]   [***]  
[***]   [****]        [*********]   [****]   [***]   [***]   [****]         
[***********]   [****]   [***]   [***]   [****]   With [*]% credit in first and
Payment is still      [****]   [****]   [***]   [***]   [****]        [****]  
[****]   [***]   [***]   [****]        *****   [****]   [***]   [***]   [****]  
       [**********]   [****]   [***]   [***]   [****]          [***]   [****]  
[***]   [***]   [****]          [*]   [**]   [***]   [***]   [****]             
           

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         Total               [****]   Miss by                     

--------------------------------------------------------------------------------

         [*********]                          [*****]                         
[******]                                         

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         Total   [****]   [***]   [***]   [****]   Miss by                     

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Portions of this Exhibit were omitted and have been filed separately with the
Secretary of the Commission pursuant to the Company’s application requesting
confidential treatment under Rule 24b-2 of the Securities Exchange Act of 1934,
as amended.