exv10w30



 



EXHIBIT 10.30



AGREEMENT


     THIS AGREEMENT (“Agreement”) dated as of August    , 2003, is made and
entered into by and among SOLUTIA INC., a Delaware corporation (“Solutia”),
PHARMACIA CORPORATION, a Delaware corporation (“Pharmacia”), and MONSANTO
COMPANY, a Delaware corporation (“Monsanto”). Each of Solutia, Pharmacia and
Monsanto are referred to herein individually as a “Party” and collectively as
the “Parties”.


     WHEREAS, Pharmacia (formerly known as Monsanto Company and sometimes
referred to herein as “Old Monsanto”) and Solutia are parties to that certain
Distribution Agreement dated as of September 1, 1997 (the “Distribution
Agreement”, which was entered into in connection with the distribution of the
common stock of Solutia to the stockholders of Old Monsanto;


     WHEREAS, pursuant to the Distribution Agreement, among other things, Old
Monsanto assigned and transferred the Chemical Assets (as defined in the
Distribution Agreement) to Solutia and Solutia assumed all of the Chemical
Liabilities (as defined in the Distribution Agreement) of Old Monsanto;


     WHEREAS, pursuant to that certain Agreement and Plan of Merger, dated as
of December 19, 1999 (the “Merger Agreement”), by and among Old Monsanto, MP
Sub, Incorporated (“Merger Sub”) and Pharmacia & Upjohn, Inc. (“PNU”), the
parties agreed that Merger Sub would be merged with and into PNU with PNU
surviving as a wholly owned subsidiary of Old Monsanto in the merger (the
“Merger”);


     WHEREAS, on February 9, 2000, the new Monsanto Company (which is the
Delaware corporation identified in the introductory paragraph of this Agreement
as “Monsanto Company” and which is referred to herein as either “New Monsanto”
or “Monsanto”, as the context requires)
was incorporated as a wholly owned subsidiary of Old Monsanto under the name
“Monsanto Ag Company”


     WHEREAS, on March 31, 2000, (i) the Merger was effective, (ii) Old
Monsanto changed its name from “Monsanto Company” to “Pharmacia Corporation”,
and (iii) New Monsanto changed its name from “Monsanto Ag Company” to “Monsanto
Company”;


     WHEREAS, on September 1, 2000, New Monsanto and Pharmacia entered into
certain agreements, including that certain Separation Agreement, dated as of
September 1, 2000 (the “Separation Agreement”), pursuant to which, among other
things, Pharmacia assigned and transferred certain assets related to its
agriculture products business and certain other assets to New Monsanto and New
Monsanto assumed certain liabilities relating thereto and all liabilities that
were assumed by Solutia or any of its subsidiaries in connection with the
Distribution Agreement to the extent that Solutia fails to pay, perform, or
discharge such liabilities;


     WHEREAS, Pharmacia and Solutia are named as defendants in each of Sabrina
Abernathy et. al. v. Monsanto Company et. al., Case No. CV01832 (“Abernathy
Litigation”) and Payton et. al. v. Monsanto Company et. al. (“Payton
Litigation”) in which the plaintiffs claim to


 







 


have sustained personal injuries and/or property damage as a result of the
alleged release of polychlorinated biphenyls (“PCBs”) from Old Monsanto’s (now
Solutia’s) plant in Anniston, Alabama;


     WHEREAS, each of Solutia, Monsanto and Pharmacia are defendants in Antonia
Tolbert et. al., v. Monsanto Company, et. al., Case No. CV-01-C-1407-W (the
“Tolbert Litigation”, and referred to herein together with the Abernathy
Litigation as the “Litigation”) in which the plaintiffs also claim to have
sustained personal injuries and/or property damage as a result of the alleged
release of PCBs from Old Monsanto’s (now Solutia’s) plant in Anniston, Alabama;


     WHEREAS, on July 1, 2002, (i) the Parties entered into a certain Amendment
to the Distribution Agreement (the “Distribution Agreement Amendment”) pursuant
to which the assignment from Pharmacia to Monsanto of certain assets and
liabilities contemplated pursuant to the Separation Agreement (including
certain of Pharmacia’s rights and obligations under the Distribution Agreement)
was effectuated and the relationship among the Parties was preserved as nearly
as possible with the original intent and terms of the Distribution Agreement,
(ii) the Parties entered into that certain Protocol Agreement (the “Anniston
Protocol Agreement”) related to the Abernathy Litigation and pursuant to which
the Parties agreed on certain matters pertaining to the posting of an appeal
bond with respect to, and control of decisions regarding settlement of, the
Abernathy litigation, and (iii) Pharmacia and Monsanto entered into that
certain First Amendment to Separation Agreement (the “Separation Agreement”, as
so amended, being referred to as the “Amended Separation Agreement”) pursuant
to which those parties clarified their respective rights and obligations
relating to Monsanto’s indemnification obligations under the Separation
Agreement;


     WHEREAS,
pursuant to the terms of the Distribution Agreement, as amended
by the Distribution Agreement Amendment (the “Amended Distribution Agreement”),
Solutia is required to manage the Litigation and indemnify, defend and hold
harmless Pharmacia and Monsanto for certain costs, expenses and judgments
arising from the Litigation;


     WHEREAS, Solutia, Pharmacia and Monsanto have reached agreement on the
settlement of the Litigation (“Settlement”) and desire to set forth herein the
respective settlement obligations of the Parties (the term “Settlement
Agreement” as used herein shall mean the definitive written settlement
agreement which is approved by an order of the court having jurisdiction over
the Litigation).


     WHEREAS, Pfizer Inc. (“Pfizer”), which is not a party to the litigation,
has agreed to make a contribution to the Settlement (“Pfizer Contribution”);
and


     NOW, THEREFORE, in consideration of the premises and mutual promises
herein contained, the adequacy and sufficiency of which is hereby acknowledged,
Solutia, Pharmacia and Monsanto, intending to be legally bound, each agree as
follows:


   1. Settlement Obligations.


     (a) In consideration for Solutia’s entering into the Settlement
Agreement and the


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performance by Solutia of its obligations hereunder and thereunder, Monsanto
hereby agrees to (i) enter into the Settlement Agreement upon court approval
thereof and to pay the Monsanto
Settlement Amount (as defined on Exhibit A hereto) promptly and in accordance
with the terms of the Settlement Agreement; (ii) fully perform all other
Monsanto Obligations (as defined on Exhibit A hereto) under the Settlement
Agreement; and (iii) in accordance with the terms of the Settlement Agreement,
absolutely, fully, finally and irrevocably release, waive and discharge any and
all actions, causes of action, judgments, executions, suits, claims,
counterclaims, demands, defenses, liabilities, obligations and expenses
(including attorneys’ fees and expenses) of any and every character or kind,
whether known or unknown, direct or indirect, liquidated or unliquidated,
disputed or undisputed, fixed or contingent, matured or unmatured, arising at
law or in equity, or heretofore or hereafter arising (collectively, “Claims”),
that it ever had, now has, or hereafter can, shall or may have or assert
against Solutia and its subsidiaries, affiliates, predecessors, successors and
assigns and any of its respective directors, officers, stockholders, members,
partners, agents, employees, representatives, attorneys, accountants and
financial and other advisors, for or by any reason or any cause, matter, thing,
occurrence, event, action, act, or omission to act arising or occurring on or
prior to the date of the Settlement Agreement, but in each case only to the
extent relating to or arising from the Litigation, whether it arises from the
Amended Distribution Agreement (including, without limitation, the
indemnification provisions thereof) or otherwise.


     (b) In consideration for Solutia’s entering into the Settlement Agreement
and the performance by Solutia of its obligations hereunder and thereunder,
Pharmacia hereby agrees to (i) enter into the Settlement Agreement upon court
approval thereof; and (ii) absolutely, fully, finally and irrevocably release,
waive and discharge any and all Claims that it ever had, now has, or hereafter
can, shall or may have or assert against Solutia and its subsidiaries,
affiliates, predecessors, successors and assigns and any of its respective
directors, officers, stockholders, members, partners, agents, employees,
representatives, attorneys, accountants and financial and other advisors, for
or by reason of the Pfizer Contribution to the Settlement Agreement.


     (c) In consideration for Monsanto’s and Pharmacia’s entering into the
Settlement Agreement and the performance by Monsanto and Pharmacia of their
respective obligations hereunder and thereunder, Solutia hereby agrees to (i)
enter into the Settlement Agreement upon court approval thereof and pay the
Solutia Settlement Amount including the Pfizer Contribution (as defined on the
attachment to Exhibit A hereto) promptly and in accordance with the terms of
the Settlement Agreement; (ii) perform all other Solutia Obligations (as
defined on Exhibit A hereto) under the Settlement Agreement; (iii) issue to
Monsanto the Solutia Common Stock Warrants on substantially the terms described
on Exhibit B hereto; (iv) fully perform all obligations of Solutia under the
Settlement Agreement relating to the Payton Litigation; (v) acknowledge
Monsanto’s rights to access and receive direct reimbursement from the insurance
policies related to coverage for claims which are the subject of the Litigation
as described on Exhibit C hereto and the proceeds thereof (collectively, the
“Insurance Policies”), excluding the following: all Solutia claims against the
Insurance Policies which are outstanding as of the date of the Settlement
Agreement relating to reimbursement for expenses previously incurred by
Solutia, and all claims filed by Solutia against the Insurance Policies after
the date of the Settlement Agreement for reimbursement of expenses that have
been, or will be incurred by Solutia in connection with the defense of the
Litigation and the defense and settlement of the


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Payton Litigation, upon the court approval of the respective settlement
agreements; and (vi) in accordance with the terms of the Settlement Agreement,
absolutely, fully, finally and irrevocably release, waive and discharge any
Claims that it ever had, now has, or hereafter can, shall or may have or assert
against Monsanto and Pharmacia and its parent, subsidiaries, affiliates,
predecessors, successors and assigns and any of their respective directors,
officers, stockholders, members, partners, agents, employees, representatives,
attorneys, accountants and financial and other advisors, for or by any reason
or any cause, matter, thing, occurrence, event, action, act, or omission to act
arising or occurring on or prior to the date of the Settlement Agreement, but
in each case only to the extent relating to or arising from the Litigation.


     2. Representations and Warranties. Each Party hereto represents and warrants
that it is duly authorized to enter into this Agreement.


     3. Successors and Assigns. The provisions of this Agreement shall be binding
upon the Parties and their respective successors and assigns and subsidiaries,
and each of the respective officers, directors, employees, agents and attorneys
of such persons.


     4. Cooperation. The Parties agree that, to the extent reasonably requested,
each will cooperate with the others in connection with any public statement,
press release or similar announcement regarding the settlement of the
Litigation.


     5. Miscellaneous. This Agreement may be executed in counterparts, each of
which shall constitute an original, but all of which when taken together shall
constitute a single contract. This Agreement and the Settlement Agreement
constitute the entire agreement among the Parties relating to the subject
matter hereof and supersede any and all previous agreements and understandings,
oral or written, relating to the subject matter hereof. Delivery of an executed
counterpart of a signature page of this Agreement by telecopy shall be
effective as delivery of a manually executed counterpart of this Agreement.


     6. Governing Law/Forum. This Agreement shall be governed in all respects by
the laws of the State of New York without regard to its conflict-of-laws rules.
Each Party consents to the non-exclusive jurisdiction of the courts of the
State of New York in the event of any dispute hereunder.


     7. Knowingly
and Voluntarily. Each Party hereby verifies that (a) it has read
and understood the provisions of this Agreement and the releases executed
pursuant hereto, (b) it is knowingly and voluntarily entering into this
Agreement, and (c) it has not been coerced or threatened into signing this
Agreement.


     8. Limited Waiver. Other than as specifically provided herein with respect to
the waiver of Claims that either Pharmacia or Monsanto may have against Solutia
for or by any reason or any cause, matter, thing, occurrence, event, action,
act, or omission to act arising or occurring on or prior to the date of the
Settlement Agreement, but in each case only to the extent relating to or
arising from the Litigation, neither Pharmacia not Monsanto has waived or
compromised any of their respective rights under the Amended Distribution
Agreement (including, without limitation, the indemnification provisions
thereof).


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     IN WITNESS WHEREOF, the undersigned have made and entered into this
Agreement as of the date first shown above.



	 	 	 	 	 	 	 
	 	 	 	 	 	 	 
	 	 	SOLUTIA INC
	 	 	 	 	 	 	 
	 	 	
By:
	 	/s/ Jeffry N. Quinn	 	 
	 	 	 	 	
	 	 
	 	 	 	 	Name: Jeffry N. Quinn	 	 
	 	 	 	 	Title: Sr. V.P.	 	 
	 	 	 	 	 	 	 
	 	 	MONSANTO COMPANY
	 	 	 	 	 	 	 
	 	 	
By:
	 	/s/ Robert A. Paley	 	 
	 	 	 	 	
	 	 
	 	 	 	 	Name: Robert A. Paley	 	 
	 	 	 	 	Title: Vice President & Treasurer	 	 
	 	 	 	 	 	 	 
	 	 	PHARMACIA CORPORATION
	 	 	 	 	 	 	 
	 	 	
By:
	 	/s/ Steven C. Kany	 	 
	 	 	 	 	
	 	 
	 	 	 	 	Name: Steven C. Kany	 	 
	 	 	 	 	Title: General Counsel	 	 





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Exhibit A


Monsanto, Pharmacia and Solutia Settlement Amounts and Settlement Obligations



	 	 	 
	Solutia Settlement Amount:	 	
$50 million payable over not less than eleven years
	 	 	 
	Pfizer Contribution:	 	
Attached
	 	 	 
	Monsanto Settlement Amount:	 	
All payment due under the Litigation
Settlement Agreement less the Solutia
Settlement Amount and Pharmacia Settlement
Amount





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Exhibit B


Solutia Inc. Common Stock Warrants




	 	 	 
	Issuer:	 	
Solutia Inc.
	 	 	 
	Recipient:	 	
Monsanto Company
	 	 	 
	Type of Security:	 	
Warrants to purchase up to 10,000,000 shares
of Solutia Common Stock, at a per share
purchase price equal to the average closing
price for the Common Stock on the New York
Stock Exchange for the five trading days
immediately prior to the announcement of a
settlement of the Litigation. The conditions
precedent to the exercise of the warrant
being either a signed Solutia change in
control agreement (as defined in the
Indenture governing Solutia’s 2009 Notes) or
when Solutia’s average closing stock price
over a 30 day period exceeds $10 per share.
	 	 	 
	Issuance:	 	
Upon court approval of Settlement Agreement.
	 	 	 
	Expiration Date of Warrants:	 	
The earlier of (i) the date which is ten
years after the date of issuance of the
warrants and (ii) the date which is seven
days after a Change in Control.
	 	 	 
	Other:	 	
The warrants will have no rights associated
with the Common Stock into which they are
exercisable, including, without limitation,
rights to dividends, proceeds upon
liquidation of Solutia or voting rights.
	 	 	 
	 	 	
The Common Stock issuable upon exercise of
the warrants will not be registered under the
Securities Act of 1933, until such time that
a registration statement is filed pursuant to
registration rights to be negotiated in good
faith by the parties.
	 	 	 
	 	 	
The warrants will not be transferable without
the prior written consent of Solutia, which
will not unreasonably be withheld.





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Exhibit C


Description of Insurance Policies


All policies of insurance applicable to the Litigation issued by AIG-related
Companies as described in an Agreement effective November 4, 2002 and by
Travelers Indemnity Company as described in an Agreement of Settlement
Compromise and Release dated December 28, 1993 as amended October 5, 2001.




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