Document:

exv10w28

 

Exhibit 10.28

Land O’Lakes, Inc.

SEVERANCE AGREEMENT

     This Severance Agreement (the “Agreement”) is made and entered into effective as of
                                        , 2005 (the “Effective Date”), by and between                                 
         (the “Executive”) and Land
O’Lakes, Inc., a Minnesota cooperative corporation (the “Company”).

RECITALS

     The Land O’Lakes, Inc. Board of Directors (“Board”) has determined that it is in the best
interest of the Company to assure that the Company will have the continued dedication and
objectivity of the Executive, notwithstanding the possibility, threat or occurrence of a
Substantial Change of Circumstances of the Company, as defined below. This agreement describes
certain benefits that will be available to the Executive in the event the Executive’s employment is
adversely affected by reason of a Substantial Change of Circumstances, in the event Executive
otherwise experiences involuntary termination for reasons other than Cause, or in the event
Executive experiences voluntary termination with good reason as defined in this Agreement.

AGREEMENT

In consideration of the mutual covenants herein contained and the offer of employment of Executive
by the Company, the parties agree as follows:

	1.	 	Definition of Terms. The following terms referred to in this Agreement shall have
the following meanings:

	 	1.1.	 	Cause. “Cause” shall mean (i) any act of personal dishonesty taken by the Executive in
connection with responsibilities as an employee which is intended to result in substantial
personal enrichment of the Executive, (ii) Executive’s conviction of a felony which the
Board reasonably believes has had or will have a material detrimental effect on the
Company’s reputation or business, (iii) a willful act by the Executive which constitutes
misconduct and results in material injury to the Company, or (iv) continued willful
violations by the Executive of the Executive’s obligations to the Company after there has
been delivered to the Executive a written demand for performance from the Company which
describes the basis for the Company’s belief that the Executive has not substantially
performed the duties of the position.
	 
	 	1.2.	 	Change of Control. “Change of Control” shall mean the occurrence of either of the
following events: (a) the approval by the Board of a merger or consolidation of the Company
with any other entity, other than a merger or consolidation which would result in the
owners of the Company immediately prior thereto continuing to own more than fifty percent
(50%) of the ownership interest of the Company or the surviving entity immediately after
such merger or consolidation; (b) the approval by the Board of a plan of complete
liquidation of the Company or an agreement for the sale or disposition by the Company of
all or substantially all of the Company’s assets; or (c) any one person, or more than one
person acting as a group, acquires ownership of stock of the Company

 

 

	 	 	 	that, together with stock held by such person or group, constitutes more than 50 percent of
the total fair market value or total voting power of the Company.

	 	1.3.	 	Involuntary Termination. “Involuntary Termination” shall mean any termination of the
Executive’s employment by the Company which is not effected for Cause.
	 
	 	1.4.	 	Target Annual Variable Pay. “Target Annual Variable Pay” means 80% of Executive’s
annual base pay as of his Termination Date.
	 
	 	1.5.	 	Termination Date. “Termination Date” shall mean the effective date of any notice of
termination of employment delivered by either Company or Executive to the other party.
	 
	 	1.6.	 	Voluntary Termination for Good Reason. “Voluntary Termination for Good Reason” means
termination of employment with the Company initiated by the Executive after any of the
following: (a) a material reduction by the Company of the Executive’s compensation
(including base salary, annual variable pay opportunity, and long-term incentive and/or
equity opportunity); (b) material change in scope of Executive’s responsibilities or
reporting relationship (provided however, the parties acknowledge and agree that a change
in the scope of Company’s operations generally that is not the result of a Substantial
Change of Circumstances shall not constitute a material change in the scope of Executive’s
responsibilities for purposes of this Agreement); (c) relocation of Company headquarters
outside the Minneapolis-St. Paul metropolitan area; or (d) the failure of a successor to
assume this Agreement pursuant to paragraph 9.1.
	 
	 	1.7.	 	Substantial Change of Circumstance. “Substantial Change of Circumstances” means (a) a
Change of Control; (b) any single sale, spinoff or other divestiture resulting in a
reduction of 35% or more of Company’s assets or revenue.

	2.	 	Term of Agreement. This Agreement shall terminate upon the earlier of the date that
all obligations of the parties hereto under this Agreement have been satisfied, or the date
established by separate written consent of the parties.
	 
	3.	 	At-Will Employment. The Company and the Executive acknowledge that the Executive’s
employment is at-will. Either Executive or the Company can terminate the employment
relationship at any time, with or without cause, subject to their respective continuing
post-employment obligations contained in this Agreement. If the Executive’s employment
terminates for any reason, including the death or disability of the Executive, the Executive
shall not be entitled to any payments, benefits, damages, awards or compensation other than as
provided by this Agreement, or, to the extent not modified by this agreement, as may otherwise
be established under the Company’s then existing employee benefit plans or policies at the
time of termination,.
	 
	4.	 	Eligibility for Severance Benefits. The benefits described in Section 5 below will
be made only in the circumstances described in Paragraphs 4.1, 4.2, 4.3, and 4.4 and then only
provided Executive complies with the conditions set forth in Paragraphs 4.5, 4.6, and 4.7. If
Executive is eligible for Severance Benefits under the terms of this Agreement, such benefits
will be in lieu of any other Company plan or practice relating to severance pay.

 

 

	 	4.1	 	Change of Control. The applicable benefits described in Section 5 below will be paid or
provided in the event of a Change of Control, and then only if Executive’s Involuntary
Termination occurs prior to and in anticipation of, or within twenty-four (24) months after a
Change of Control, or if an event giving rise to Voluntary Termination for Good Reason occurs
within twenty-four (24) months after a Change of Control.
	 
	 	4.2	 	Other Substantial Change of Circumstances. The applicable benefits described in Section 5
below will be paid or provided in the event of a Substantial Change of Circumstance other
than a Change of Control, and then only if Executive’s Involuntary Termination occurs prior
to and in anticipation of, or within twelve (12) months after such Substantial Change of
Circumstance, or if an event giving rise to Voluntary Termination for Good Reason occurs
within twelve (12) months after such Substantial Change of Circumstance.
	 
	 	4.3	 	Other Involuntary Termination. Pursuant to the terms of the Offer Letter dated July 15,
2005, in the event of Executive’s Involuntary Termination at any time under circumstances
which do not constitute a Substantial Change of Circumstances, Executive will be entitled to
the applicable benefits described in Section 5 below.
	 
	 	4.4	 	Other Voluntary Termination for Good Reason. In the event of Executive’s Voluntary
Termination for Good Reason under circumstances which do not constitute a Substantial Change
of Circumstances, Executive will be entitled to the applicable benefits described in Section
5 below.
	 
	 	4.5	 	Notification. The Executive must provide notice to Company of Voluntary Termination with
Good Reason within sixty days after the occurrence of the event described in Paragraph 1.6
giving rise to “good reason.” The Effective Termination Date specified in the notice shall be
not more than thirty days after the date of the notice unless otherwise mutually agreed by
the parties.
	 
	 	4.6	 	Confidentiality. Executive has signed an Invention and Trade Secret Agreement and has
other legal and fiduciary obligations to maintain the confidentiality of Company information,
including information relating to potential or planned Substantial Change of Circumstance
events. Executive’s compliance with his obligations of confidentiality is a condition to
receiving any payments or benefits under this Agreement.
	 
	 	4.7	 	Separation Agreement and Release. As consideration for the benefits provided pursuant to
Section 5 of the agreement, Executive must execute a Separation Agreement and Release
reasonably satisfactory to the Company. The Separation Agreement and Release will be provided
to Executive within seven (7) days of his Termination Date, and shall include the following
provision: 

Non-competition; Non-solicitation.

	 	(a)	 	Executive agrees that for the two-year period from and after his
Termination Date, he will not, within the Restricted Area (as hereinafter
defined) either directly, alone or with others, own, manage, operate,

 

 

	 	 	 	control, participate in, or be connected in any manner with the ownership,
management, operation, or control of any business which involves the
manufacture, sale, marketing, or distribution of Products (as hereafter
defined) which compete with Products currently produced or sold by Land
O’Lakes or its subsidiaries or affiliates. Executive further agrees that for
the two-year period from and after his Termination Date, he will not
solicit, induce, or attempt to persuade any agent, employee, or customer of
Land O’Lakes or its legal successors to terminate an existing employment,
agency, or business relationship with Land O’Lakes or its legal successors
in order to enter into any such relationship with, or on behalf of, any
Competitor (as hereinafter defined), or otherwise knowingly interfere with
the relationship of Land O’Lakes or its legal successors with any of its
employees, contractors, agents, or customers.

	 	(b)	 	For purposes of this non-compete agreement, “Products” means all products
and related services manufactured, marketed, distributed and sold by Land O’Lakes
or any subsidiary or affiliate of Land O’Lakes during the five year period
preceding the Termination Date; “Restricted Area” means the United States; and
“Competitor” means any person or entity that manufactures, sells, markets, or
distributes Products within the Restricted Area.
	 
	 	(c)	 	If, at the time of enforcement of this provision, a court
shall hold that the duration, scope, area, or other restrictions stated herein
are unreasonable duration, scope, area, or other restrictions that are
reasonable under such circumstances shall be substituted for the stated
duration, scope, area, or other restrictions.
	 
	 	(d)	 	The foregoing non-competition provision shall not preclude
Executive from owning less than two percent (2%) of any company, the stock of
which is traded on any national or regional exchange or any established
over-the-counter trading market.

	 	4.7.	 	Burden of Proof. Executive shall have the burden of proof to establish that an
Involuntary Termination has occurred “in anticipation of” a Substantial Change of Circumstances by
demonstrating that but for the anticipated Substantial Change of Circumstances, such Involuntary
Termination would not have occurred.

	5.	 	Severance Benefits. If the Executive meets the eligibility requirements described in
Section 4 above, the Executive shall be entitled to the following benefits:

	 	5.1.	 	Involuntary Termination Caused by Substantial Change of Circumstances; Voluntary
Termination with Good Reason Following Change of Control. In the event of Executive’s
Involuntary Termination prior to and in anticipation of, or following any Substantial
Change of Circumstances, or in the event of Executive’s Voluntary Termination with Good
Reason following a Change of Control, Company will provide Executive with Separation
Allowance comprised of the following amounts: thirty-six
(36) months of the Executive’s base salary (as in effect immediately prior to the

 

 

	 	 	 	Substantial Change of Circumstances); three times Target Annual Variable Pay; an amount
equivalent to the value of unvested options or units forfeited by operation of the CVIP; an
amount equivalent to Long-Term Incentive target pro-rated as of the Termination Date. No
payment in this paragraph is intended to duplicate any benefits payable under the terms of
the LTIP or CVIP.

	 	5.2.	 	Other Voluntary Termination with Good Reason; Other Involuntary Termination. In the
event of Executive’s Voluntary Termination with Good Reason in circumstances other than a
Change of Control, or in the event of Executive’s Involuntary Termination under
circumstances which do not constitute a Substantial Change of Circumstances, Company will
provide Executive with a Separation Allowance in an amount equal to twenty-four (24) months
of the Executive’s base salary (as in effect immediately prior to the Substantial Change of
Circumstances).
	 
	 	5.3.	 	Timing of Payments. The Separation Allowance will be paid in three equal installments:
the first installment will be paid within ten (10) days after the Termination Date or the
expiration of the rescission period described in the Separation Agreement and Release,
whichever is later; the second and third installments will be paid on the first and second
anniversaries of the Termination Date, respectively. The Separation Allowance shall not be
taken into account to determine any benefit calculation or contribution in any qualified or
non-qualified retirement plan maintained by Company. Executive acknowledges that Company is
required to withhold from the Separation Allowance federal income taxes at the rate
required by law, regardless of any other withholding election that Executive may have made
with respect to his wages.
	 
	 	5.4.	 	Employee Benefits. On and after the Termination Date, all employee benefits will be
treated as provided in the relevant plan documents or according to Company’s normal
practices and procedures, except as specifically provided in this Agreement.

	 	(a)	 	Health Care Continuation. Company agrees to offer to Executive, and Executive
at his sole option may elect to continue his current health care coverage (including
medical, dental, hearing and/or vision coverage) at active employee rates for up to the
Specified Period following his Termination Date upon the timely payment by Executive to
Company or its designated representative of the amount due for such coverage; the
Company will continue to pay its share of such costs for such coverage on an active
employee basis. For purposes of this Agreement, the Specified Period will be thirty-six
(36) months if Executive is eligible for benefits under paragraph 5.1 above, and
twenty-four (24) months if Executive is eligible for benefits under paragraph 5.2
above. Health care coverage under such plans shall continue until the earlier of: (i)
the effective date on which Executive secures comparable coverage under another group
health plan, or (ii) the expiration of the Specified Period. Executive shall notify
Company as soon as reasonably practicable of the effective date of any health care
coverage he secures following his separation from employment with Company, provided
such coverage is obtained during the Specified Period. Executive acknowledges that the
health care coverage continuation provided under this paragraph 5.4(a) will satisfy
Company’s obligations under the Consolidated Omnibus Budget Reconciliation Act of 1985
(“COBRA”), provided that if circumstances occur which would extend COBRA eligibility beyond the Specified

 

 

	 	 	 	Period, Executive may continue such coverage for any additional period of COBRA eligibility at
normal COBRA rates. Executive acknowledges and agrees that he is solely responsible for
signing and returning to Company or its designated representative all documents required
by Company in order to effect health care options selected by him.

	 	(b)	 	Life Insurance Continuation. Company agrees to pay on behalf of Executive the
premiums for continuation of his current life insurance coverage for the duration of
the statutory continuation period.

	 	5.5.	 	Executive Outplacement. Executive will be provided with executive outplacement
assistance through a provider of his choice, at a cost not to exceed Twenty Thousand
Dollars ($20,000). No cash payment in lieu of outplacement services will be provided in the
event Executive declines such services.
	 
	 	5.6.	 	Annual Variable Compensation. Executive will be paid a prorated portion of annual
variable compensation for the year in which Termination Date occurs, based on projected
results as of Termination Date; such amount will be payable in the next calendar year when
such payments are normally made.

	6.	 	Severance Benefits; Other Termination. If the Executive’s employment with the
Company terminates at any time under circumstances which do not meet the eligibility
requirements described in Paragraph 4.1, 4.2, 4.3, or 4.4, then the Executive shall not be
entitled to receive severance or other benefits described in Section 5 above, but may be
eligible for those benefits (if any) as may then be established under the Company’s then
existing severance and benefits plans and policies at the Termination Date or under another
agreement with the Company.

	7.	 	Accrued Wages and Vacation; Expenses. Without regard to the reason for, or the timing
of, Executive’s termination of employment: (i) the Company shall pay the Executive any unpaid
base salary due for periods prior to the Termination Date; (ii) the Company shall pay the
Executive all of the Executive’s accrued and unused PTO through the Termination Date; and
(iii) following submission of proper expense reports by the Executive, the Company shall
reimburse the Executive for all expenses reasonably and necessarily incurred by the Executive
in connection with the business of the Company prior to the Termination Date.
	 
	8.	 	Limitation on Payments and Benefits

	 	 	 	8.1Limitation. Notwithstanding anything to the contrary contained in this Agreement if,
after taking into account all amounts and benefits to be paid or payable to the Executive
under this Agreement or otherwise, any amount or benefit to be paid or provided under this
Agreement or any other plan or agreement would be a “parachute payment,” within the meaning
of Section 280G of the Internal Revenue Code of 1986, as amended (the “Code”), or any
successor provision thereto, and but for this Section 8 would be subject to the excise tax
imposed by Section 4999 of the Code, then the payments and benefits to be so paid or
provided under this Agreement or any other plan or agreement shall be either

 

 

	 	 	 	(a) delivered in full in the amounts and at the times set forth in this Agreement, or
	 
	 	 	 	(b) delivered as to such lesser extent which would result in no portion of such
payments and benefits being subject to excise tax under Section 4999 of the Code, or
any successor provision thereto, or any tax imposed by any comparable provision of
state law, whichever of the foregoing amounts, taking into account the applicable
federal, state and local income taxes and the excise tax imposed by Section 4999 of
the Code, or any successor provision thereto, or any tax imposed by any comparable
provision of state law, results in the receipt by the Executive on an after-tax
basis, of the greatest amount of payments and benefits, notwithstanding that all or
some portion of such payments and benefits may be taxable under Section 4999 of the
Code, or any successor provision thereto, or any tax imposed by any comparable
provision of state law. Any taxes due under Section 4999 of the Code, or any
successor provision thereto, or any tax imposed by any comparable provision of state
law shall be the responsibility of the Executive.

	 	 	 	8.2. Auditor’s Determination. Any determination as to the amount or timing of payments
required under this Section 8 shall be made in writing by the Company’s independent
accountants or other qualified professional engaged by the Company (the “Auditor”)
immediately prior to the Change of Control, whose determination shall be conclusive and
binding upon the Executive and the Company for all purposes. For purposes of making the
calculations required by this Section 8, the Auditor may, after taking into account the
information provided by the Executive, make reasonable assumptions and approximations
concerning applicable taxes and may rely on reasonable, good faith interpretations
concerning the application of Section 280G and 4999 of the Code. The Company and the
Executive shall furnish to the Auditor such information and documents as the Auditor may
reasonably request in order to make a determination under this Section. If the auditor
identifies more than one option which would meet the requirements of Paragraph 8.1, the
Executive may select among the identified options within 30 days after receiving the
Auditor’s written determination. The Company shall bear all costs the Auditor may
reasonably incur in connection with any calculations contemplated by this Section 8. If, as
a result of any reduction required by Paragraph 8.1, amounts previously paid to the
Executive exceed the amount to which the Executive is entitled, the Executive will promptly
return the excess amount to the Company.

	9.	 	Successors.

	 	 	 	9.1 Company’s Successors. Any successor to the Company (whether direct or indirect and whether
by purchase, lease, merger, consolidation, liquidation or otherwise) to all or substantially all
of the Company’s business and/or assets shall assume the Company’s obligations under this
Agreement and agree to perform the Company’s obligations under this Agreement in the same manner
and to the same extent as the Company would be required to perform such obligations in the
absence of a succession..
	 
	 	 	 	9.2 Executive’s Successors. Without the written consent of the Company, Executive shall not
assign or transfer this Agreement or any right or obligation under this Agreement to any
other person or entity. Notwithstanding the foregoing, the terms of this Agreement and all

 

 

	 	 	 	rights of Executive hereunder shall inure to the benefit of, and be enforceable by, Executive’s
personal or legal representatives, executors, administrators, successors, heirs, distributees,
devisees and legatees.

	10.	 	Notices.

	 		 	10.1 General. Notices and all other communications contemplated by this Agreement shall be in
writing and shall be deemed to have been duly given when personally delivered or when mailed by
U.S. registered or certified mail, return receipt requested and postage prepaid. In the case of
the Executive, mailed notices shall be addressed to him at the home address which he most
recently communicated to the Company in writing. In the case of the Company, mailed notices
shall be addressed to its corporate headquarters, and all notices shall be directed to the
attention of Vice President, Human Resources.
	 
	 		 	10.2 Notice of Termination. Any Involuntary Termination by the Company or Voluntary Termination
for Good Reason by the Executive shall be communicated by a notice of termination to the other
party hereto given in accordance with this Section. Such notice shall indicate the specific
termination provision in this Agreement relied upon, shall set forth in reasonable detail the
facts and circumstances claimed to provide a basis for termination under the provision so
indicated, and shall specify the Termination Date (which shall be not less than 30 days after
the giving of such notice).

	11.	 	Dispute Resolution. All disputes arising hereunder shall be settled in accordance with
the following dispute resolution process:

	 		 	11.1 Negotiation; Mediation. The parties hereto will attempt to settle any claim or
controversy arising out of this Agreement through consultation and negotiation in good faith
and a spirit of mutual cooperation. However, at any time before or during such negotiations,
or following any unsuccessful negotiations, either party may by written notice to the other
demand that the dispute be submitted to mediation. When such a demand is made, the parties
shall within ten (10) days jointly make arrangements for the mediation of the dispute within
the State of Minnesota pursuant to the Model Procedure for Mediation of Business Disputes
produced by the Center for Public Resources (CPR).
	 
	 		 	11.2 Effect on other legal proceedings. Neither party shall initiate any litigation or other
formal claim procedure before the parties have in good faith exhausted the negotiation and
mediation steps described in paragraph 11.1; provided, however, nothing in this Agreement
will prevent either party from resorting to judicial proceedings prior to that time for the
limited purposes of seeking a preliminary injunction or to avoid the barring of the claim
under the applicable statute of limitations. In addition, resort by either party to
negotiation or mediation pursuant to this Agreement shall not be construed under the
doctrine of laches, waiver or estoppel to affect adversely the rights of either party to
pursue any such judicial relief; provided, however, that irrespective of the filing of any
such request for judicial relief the party shall continue to participate in the dispute
resolution proceedings required by this Section 11. Any negotiation or mediation which takes
place pursuant to this Agreement shall be confidential and shall be treated as a
compromise and settlement negotiation for purposes of the Federal Rules of Evidence and
State rules of Evidence.

 

 

	12.	 	Miscellaneous Provisions.

	 	 	 	12.1 Waiver. No provision of this Agreement may be modified, waived or discharged unless the
modification, waiver or discharge is agreed to in writing and signed by the Executive and by an
authorized officer of the Company (other than the Executive). No waiver by either party of any
breach of, or of compliance with, any condition or provision of this Agreement by the other
party shall be considered a waiver of any other condition or provision or of the same condition
or provision at another time.
	 
	 	 	 	12.2 Integration. This Agreement represents the entire agreement and understanding between the
parties as to the Company’s obligation to make payments and provide benefits to the Executive in
the event of Involuntary Termination, or in the event of Voluntary Termination for Good Reason
under the circumstances defined herein, and supersedes all prior or contemporaneous agreements
on the subject, whether written or oral.
	 
	 	 	 	12.3 Choice of Law. The validity, interpretation, construction and performance of this Agreement
shall be governed by the internal substantive laws, but not the conflicts of law rules, of the
State of Minnesota.
	 
	 	 	 	12.4 Severability. The invalidity or unenforceability of any provision or provisions of this
Agreement shall not affect the validity or enforceability of any other provision hereof, which
shall remain in full force and effect.
	 
	 	 	 	12.5 Counterparts. This Agreement may be executed in counterparts, each of which shall be deemed
an original, but all of which together will constitute one and the same instrument.

     IN WITNESS WHEREOF, each of the parties has executed this Agreement, in the case of the
Company by its duly authorized officer, as of the day and year first above written.

	 	 	 	 	 	 	 	 	 
	EXECUTIVE	 	 	 	LAND O’LAKES, INC.	 	 
	 
	 	 	 	 	 	 	 	 
	/s/ Christopher J. Policinski

	 	 	 	By:
	 	/s/ Peter Kappelman	 	 
	 

	 	 	 	 	 	 	 	 
	 

	 	 	 	 	 	Title: Board Chairman	 	 
	 
	 	 	 	 	 	 	 	 
	 

	 	 	 	By:
	 	/s/ Karen M. Grabow	 	 
	 

	 	 	 	 	 	 	 	 
	 

	 	 	 	 	 	Title: Vice President, Human ResourcesExhibit 4.1

 

UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY TRUST COMPANY (55 WATER STREET, NEW YORK, NEW YORK) TO THE ISSUER OR ITS AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE OR PAYMENT, AND ANY CERTIFICATE ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR SUCH OTHER NAME AS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY TRUST COMPANY AND ANY PAYMENT IS MADE TO CEDE & CO., ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL SINCE THE REGISTERED OWNER HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.

	
            Number R-1
 	
            
 
 	
            $300,000,000
 CUSIP 61166W AF 8
 
	
            5.125% Senior Note due 2018
 
	
            Rate of Interest
 	
            Maturity Date
 	
            Original Issue Date
 
	
               5.125%
 	
            April 15, 2018
 	
            April 15, 2008
 

MONSANTO COMPANY, a corporation duly organized and existing under the laws of Delaware (herein called the “Company,” which term includes any successor Person under the Indenture hereinafter referred to), for value received, hereby promises to pay to CEDE & CO., or registered assigns, the principal sum of THREE HUNDRED MILLION DOLLARS on the Maturity Date shown above, and to pay interest thereon from April 15, 2008 or from the most recent Interest Payment Date (which term, as well as all other capitalized terms used herein, shall have the meanings assigned in such Indenture unless otherwise indicated) to which interest has been paid or duly provided for, semi-annually on April 15 and October 15 in each year, commencing October 15, 2008, at the
rate of 5.125% per annum, until the principal hereof is paid or made available for payment.  The interest so payable, and punctually paid or duly provided for, on any Interest Payment Date will, as provided in such Indenture, be paid to the Person in whose name this Security (or one or more Predecessor Securities) is registered at the close of business on the Regular Record Date for such payment, which shall be the April 1 or October 1 (whether or not a Business Day), as the case may be, next preceding such Interest Payment Date.  Any such interest not so punctually paid or duly provided for will forthwith cease to be payable to the Holder on such Regular Record Date and may either be paid to the Person in whose name this Security (or one or more Predecessor Securities) is registered at the close of business on a Special Record Date for the payment of such Defaulted Interest to be fixed by the Trustee, notice whereof shall be given to Holders of Securities of this series not less than
10 days prior to such Special Record Date, or be paid at any time in any other lawful manner not inconsistent with the requirements of any securities exchange on which the Securities of this series may be listed, and upon such notice as may be required by such exchange, all as more fully provided in said Indenture.

Payment of the principal of (and premium, if any) and any such interest on this Note will be made at the office or agency of the Company maintained for that purpose in the Borough of Manhattan, The City of New York, in such coin or currency of the United States of America as at the time of payment is legal tender for payment of public and private debts; provided, however, that at the option of the Company payment of interest may be made by check mailed to the address of the Person entitled thereto as such address shall appear in the Security Register or by wire transfer to an account maintained by the Person entitled thereto as specified in the Security Register, provided that such Person shall have given the Trustee written wire instructions at least five Business Days prior to the applicable Interest Payment Date.  Interest shall be computed on the basis of a 360-day
year consisting of twelve 30-day months.

This Note is one of a duly authorized issue of securities of the Company (herein called the “Notes”), issued and to be issued in one or more series under an Indenture, dated as of August 1, 2002 (herein called the “Indenture”), between the Company and The Bank of New York Trust Company, N.A., as successor Trustee (herein called the “Trustee”, which term includes any further successor trustee under the Indenture), to which Indenture and all indentures supplemental thereto reference is hereby made for a statement of the respective rights, limitations of rights, duties and immunities thereunder of the Company, the Trustee and the Holders of the Notes and of the terms upon which the Notes are, and are to be, authenticated and delivered.  This Note is one of the series designated above, initially limited in aggregate principal amount to $300,000,000. 

Reference is hereby made to the further provisions of this Note set forth on the reverse hereof, which further provisions shall for all purposes have the same effect as if set forth at this place.

Unless the certificate of authentication hereon has been executed by the Trustee referred to above by manual signature, this Note shall not be entitled to any benefit under the Indenture or be valid or obligatory for any purpose.

IN WITNESS WHEREOF, the Company has caused this instrument to be duly executed under its corporate seal.

 

	
            DATED: April 15, 2008
 	
             
 	
            MONSANTO COMPANY
 
	
             
 	
             
 	
             
 	
             
 	
             
 
	
            TRUSTEE’S CERTIFICATE OF AUTHENTICATION
 	
             
 	
            By
 	
             
 
	
            This is one of the Securities of the series designated therein
        referred to in the within-mentioned Indenture.
 	
             
 	
             
 	
            Vice President and Treasurer
 
	
             
 	
             
 	
            ATTEST
 
	
            The Bank of New York Trust Company, N.A., as Trustee
 	
             
 	
            
 
 
	
            BY
 	
             
 	
             
 	
            Assistant Secretary
 
	
             
 	
            Authorized Signatory
 	
             
 	
             
 

 

 

 

MONSANTO COMPANY

5.125% Senior Note due 2018

	
            The Notes will be subject to redemption as follows:

(i)  The Notes will be redeemable, in whole or in part, at the option of the Company at any time or from time to time at a redemption price equal to the greater of (a) 100% of the principal amount of the Notes being redeemed or (b) the sum of the present values of the remaining scheduled payments of principal and interest on the Notes being redeemed (not including any portion of any payments of interest accrued to the redemption date) discounted to the redemption date on a semi-annual basis (assuming a 360-day year consisting of twelve 30-day months) at the Treasury Rate (as defined below) plus 25 basis
points, plus in each case, accrued and unpaid interest on the Notes to the redemption date;

(ii)  “Comparable Treasury Issue” means, with respect to each Treasury Reference Dealer, the United States Treasury security selected by such Reference Treasury Dealer as having a maturity comparable to the remaining term of the Notes to be redeemed that would be utilized, at the time of selection and in accordance with customary financial practice, in pricing new issues of corporate debt securities of comparable maturity to the remaining term of those Notes;

(iii) “Comparable Treasury Price” means, with respect to any redemption date, (i) the average of the Reference Treasury Dealer Quotations
for the redemption date, after excluding the highest and lowest Reference Treasury Dealer Quotations, or (ii) if the Trustee obtains fewer than three Reference Treasury Dealer Quotations, the average of all Reference Treasury Dealer Quotations;

(iv) “Reference Treasury Dealer” means (a) Citigroup Global Markets Inc., Goldman, Sachs & Co., J.P. Morgan Securities Inc., and Merrill Lynch, Pierce, Fenner & Smith Incorporated (or their respective affiliates which are Primary Treasury Dealers) and their respective successors; provided, however, that if any of the foregoing shall cease to be a primary U.S. Government securities dealer in New York City (a “Primary Treasury Dealer”), the Company will substitute another Primary Treasury Dealer; and (b) any other Primary Treasury Dealer selected by the Company.

(vii) “Reference Treasury Dealer Quotations” means, with respect to each Reference Treasury Dealer and any redemption date, the average, as determined by the Trustee, of the bid and asked prices for the Comparable Treasury Issue (expressed in each case as a percentage of its principal amount) quoted in writing to the Trustee by that Reference Treasury Dealer at 3:30 p.m., New York City time, on the third Business Day preceding that redemption date;

(viii) “Treasury Rate” means, with respect to any redemption date, the rate per annum equal to the semi-annual equivalent yield to maturity of the Comparable Treasury Issue, assuming a price for the Comparable Treasury Issue (expressed as a percentage of
its principal amount) equal to the Comparable Treasury Price for the redemption date. Notwithstanding the foregoing, installments of interest on the Notes that are due and payable on Interest Payment Dates falling on or prior to a redemption date will be payable on the Interest Payment Date to the Holders as of the close of business on the relevant record date according to the Notes and the Indenture.

Offer to Redeem Upon Change of Control Triggering Event:

(i) Upon the occurrence of a Change of Control Triggering Event, unless the Company has exercised its right to redeem the Notes as described immediately above, each Holder will have the right to require the Company to purchase all or a portion of such
Holder’s Notes, at a purchase price equal to 101% of the principal amount thereof plus accrued and unpaid interest, if any, to the date of purchase, subject to the rights of Holders to receive interest due on the scheduled Interest Payment Dates.

(ii) Within 30 days following the date upon which the Change of Control Triggering Event occurs or, at the Company’s option, prior thereto but after the public announcement of the pending Change of Control, the Company will send, by first class mail, a notice to each Holder setting forth the Company’s offer to purchase the Notes, specifying the purchase date, which will be no earlier than 30 days nor later than 60 days from the date the notice is mailed, unless otherwise required by law. If mailed prior to the date of the Change of Control, the notice will state that the offer is subject
to completion of the Change of Control. Holders electing to sell their Notes will be required to surrender their Notes in accordance with the offer, to the Paying Agent at the address to be specified in the notice, or transfer their Notes to the Paying Agent by book-entry transfer, prior to the close of business on the third business day prior to the payment date.

(iii) The Company will not be required to make a Change of Control offer if a third party makes such an offer in the manner and at the times set forth above and otherwise in compliance with the requirements set forth above, and such third party purchases all Notes of such series properly tendered and not withdrawn under its offer.

 (iv)
“Change of Control” means any of the following:

(a) the direct or indirect sale, lease, transfer, conveyance or other disposition (other than by way of merger or consolidation), in one or a series of related transactions, of all or substantially all of the assets of the Company and its subsidiaries to any “person” (as that term is used in Section 13(d)(3) of the U.S. Securities Exchange Act of 1934, as amended (the “Exchange Act”));

(b) any transaction (including any merger or consolidation) the result of which is that any “person” becomes the “beneficial owner” (as defined in Rules 13d-3 and 13d-5 under the Exchange Act), directly or indirectly, of more
than 50% of the outstanding voting power of the Company’s outstanding shares;

(c) the Company consolidates with, or merges with or into, any entity, or any entity consolidates with or merges with or into the Company, unless following the transaction the Company’s shareholders prior to the transaction own a majority of the voting power of the outstanding shares of the surviving entity;

(d) the first day on which the majority of the members of the Company’s board of directors cease to be continuing directors, which are (i) persons who are directors at the date of issuance of the Notes or (ii) persons nominated or elected with the approval of a majority of continuing directors; or

(e) the adoption of a plan for the Company’s liquidation or dissolution.

(v) “Change of Control Triggering Event” means that the Notes cease to be rated Investment Grade by at least two of the three Rating Agencies on any date during the period starting 60 days prior to the Company’s first public announcement of any Change of Control and ending 60 days following consummation of the Change of Control (subject to extension so long as any of the Rating Agencies has publicly announced that it is considering a possible ratings change, other than an announcement with positive implications), and the applicable Rating Agencies confirm that any reduction in ratings is attributable to the Change of Control.
However, no Change of Control Triggering Event will be deemed to have occurred unless and until the Change of Control has been consummated.

 
 	
            (vi) “Fitch” means Fitch Inc., a subsidiary of Fimalac, S.A., and its successors.

(vii) “Investment Grade” means a rating of Baa3 or better by Moody’s (or its equivalent under any successor rating category of Moody’s); a rating of BBB- or better by S&P (or its equivalent under any successor rating category of S&P); and a rating of BBB- or better by Fitch (or its equivalent under any successor rating category of Fitch).

(viii) “Moody’s” means Moody’s
Investors Service, Inc., a subsidiary of Moody’s Corporation, and its successors.

(ix) “S&P” means Standard & Poor’s Ratings Services, a division of The McGraw-Hill Companies, Inc., and its successors.

(x) “Rating Agency” means each of Moody’s, S&P and Fitch; provided, that if any of Moody’s, S&P and Fitch ceases to provide rating services to issuers or investors for reasons outside of the Company’s control, the Company may appoint another  “nationally recognized statistical rating organization” within the meaning of Rule 15c3-1(c)(2)(vi)(F) under the Exchange Act as a replacement for such Rating Agency.

The Securities of this series do not have the benefit of any sinking fund obligations.

In the event of redemption of this Note in part only, a new Note or Security of this series and of like tenor for the unredeemed portion hereof will be issued in the name of the Holder hereof upon the cancellation hereof.

The Indenture contains provisions for defeasance at any time of the entire indebtedness of this Note and/or certain restrictive covenants and Events of Default with respect to this Note, in each case upon compliance with certain conditions set forth in the Indenture.

If an Event of Default with respect to Securities of this series shall occur and be continuing, the principal of the Securities of this series may be declared due and payable in the manner and with the effect provided in the Indenture.

No reference herein to the Indenture and no provision of this Note or of the Indenture shall alter or impair the obligation of the Company, which is absolute and unconditional, to pay the principal of and any premium and interest on this Note at the times, place and rate, and in the coin or currency, herein prescribed.

As provided in the
Indenture and subject to certain limitations therein set forth, the transfer of this Note is registrable in the Security Register, upon surrender of this Note for registration of transfer at the office or agency of the Company in any place where the principal of and any premium and interest on this Note are payable, duly endorsed by, or accompanied by a written instrument of transfer in form satisfactory to the Company and the Security Registrar duly executed by, the Holder hereof or his attorney duly authorized in writing, and thereupon one or more new Securities of this series and of like tenor, of authorized denominations and for the same aggregate principal amount, will be issued to the designated transferee or transferees. 

If at any time the Depositary for this Note notifies the Company that it is unwilling or unable to continue as
Depositary for this Note or if at any time the Depositary shall no longer be eligible under the Indenture with respect to this Note, and if a successor Depositary eligible under the Indenture for this Note is not appointed by the Company within 90 days after the Company receives such notice or becomes aware of such ineligibility, the Company’s election that the Notes of this issue be represented by a Book-Entry Security shall no longer be effective with respect to this Note, and the Company shall execute, and the Trustee upon receipt of a Company Order for the authentication and delivery of definitive Securities shall authenticate and deliver, Securities in definitive form in an aggregate principal amount equal to the principal amount of this Note in exchange for this Note.  The Company may at any time and in its sole discretion determine that the Securities of this series shall no longer be represented by Book-Entry Securities.  In such event the Company shall execute, and the
Trustee, upon receipt of a Company Order, shall authenticate and deliver, Securities of this series in definitive form and in an aggregate principal amount equal to the principal amount of the Book-Entry Security or Securities representing this series in exchange for such Book-Entry Security or Securities.

No Holder of any Securities shall have any right to institute any proceeding, judicial or otherwise, with respect to the Indenture or for the appointment of a receiver or trustee, or for any other remedy under the Indenture, unless: (1) the Trustee shall have received written notice from such Holder of a continuing Event of Default in respect of such Securities; (2) the Trustee shall have received a written request from the Holders of not less than 25% in principal amount of the Outstanding Securities of the series in respect of which the
Event of Default has occurred to institute proceedings in respect of such Event of Default in its own name as trustee under the Indenture; (3) such Holder or Holders have offered to the Trustee indemnity satisfactory to the Trustee against the costs, expenses and liabilities to be incurred in compliance with such request; (4) the Trustee for 60 days after its receipt of such notice, request and offer of indemnity has failed to institute any such proceeding; and (5) no direction inconsistent with such written request has been given to the Trustee during such 60 day period by the Holders of a majority in principal amount of the Outstanding Securities of such series.

The Securities of this series are issuable only in registered form without coupons in denominations of $1,000 and any integral multiple thereof.  As provided in the Indenture and
subject to certain limitations therein set forth, Securities of this series are exchangeable for a like aggregate principal amount of Securities of this series and of like tenor of a different authorized denomination, as requested by the Holder surrendering the same.

No service charge shall be made for any such registration of transfer or exchange, but the Company may require payment of a sum sufficient to cover any tax or other governmental charge payable in connection therewith. 

No recourse shall be had for the payment of the principal of (or premium, if any) or the interest on this Note, or for any claim based hereon, or otherwise in respect hereof, or based on or in respect of the Indenture or any
indenture supplemental thereto, against any incorporator, stockholder, officer, director or employee, as such, past, present or future, of the Company or any successor corporation, whether by virtue of any constitution, statute or rule of law, or by the enforcement of any assessment or penalty or otherwise, all such liability being, by the acceptance hereof and as part of the consideration for the issue hereof, expressly waived and released. 

Prior to due presentment of this Note for registration of transfer, the Company, the Trustee and any agent of the Company or the Trustee may treat the Person in whose name this Note is registered as the owner hereof for all purposes (subject to Section 308 of the Indenture), whether or not this Note be overdue, and neither the Company, the Trustee nor any such agent shall be affected by notice to the
contrary.

This Note shall be governed by and construed in accordance with the laws of the State of New York without regard to the conflicts of laws principles .

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