Exhibit 10.1

Fiscal 2013 Annual Incentive Plan

(September 1, 2012 through August 31, 2013 Performance Period)

The Fiscal 2013 Annual Incentive Plan (the “Fiscal 2013 AIP”) provides eligible employees the opportunity to earn cash awards for Company and individual performance during the Performance Period .

Performance Period : September 1, 2012 through August 31, 2013, the Company’s fiscal year 2013 (the “Performance Period”).

Eligibility :  All regular employees of Monsanto Company and its subsidiaries (the “Company”) who do not participate in a sales or business-specific annual incentive plan.

Performance Goals :

·	The People and Compensation Committee of the Board of Directors (the “Committee”) establishes Threshold, Target and Outstanding level goals for the Performance Period relating to the following financial goals (each, a “Financial Goal” and collectively, the “Financial Goals”):

Ø	Net Sales (weighted 10%);

Ø	Diluted Earnings Per Share (weighted 50%); and

Ø	Free Cash Flow (“Cash Flow”) (weighted 40%) .

·	Each employee participating in the Fiscal 2013 AIP (a “Participant”) also has individual performance goals relating to business and/or people initiatives .

General Provisions :

·	Each Participant is provided a “Target Incentive Opportunity” for the Performance Period, expressed as a percentage of base pay in effect as of the last day of the Performance Period (i.e., August 31, 2013) .

·	The Plan’s “Target Award Pool” is the sum of the dollar amount of all Participants’ Target Incentive Opportunities .

Plan Funding :

·	After the end of the Performance Period, the Committee determines in its sole discretion its calculation of the “Funding Factor,” which represents the percentage attainment (on a weighted average basis) of the three Financial Goals (Net Sales, EPS and Cash Flow) based

 

on the Company’s performance against each of the Financial Goals for the Performance Period, as follows:

 

·	The Funding Factor is multiplied by the Plan’s Target Award Pool to determine the amount of the Fiscal 2013 AIP Award Pool.

·	Special considerations for the Committee to follow when determining funding of the Award Pool in its sole discretion:

Ø	The Committee may, in its sole discretion, consider subjective factors in determining whether or not any Financial Goal has been attained and the amount of Award Pool funding with respect to each Financial Goal, if any.

Ø

The Award Pool will fund at 20% of Target-level funding in the event the Company pays dividends with respect to each of its fiscal quarters ending during the Performance Period. However, if the Company fails to attain at least the Threshold-level of performance with respect to the EPS Financial Goal for the Performance Period, the Award Pool may not be funded at a level greater than 20% of Target-level funding.

Ø

One or more of the Financial Goals may be funded at above Outstanding-level funding if the Committee determines in its sole discretion that Company performance with respect to such Financial Goal warrants such funding; provided, however, the overall funding of the Award Pool is capped at 200% of Target-level funding unless the Committee determines in its sole discretion to fund above 200%.

Allocation of the Award Pool :

·	The Award Pool is allocated among Participants based upon:

Ø	each Participant’s Target Annual Incentive Opportunity for the Performance Period;

Ø	performance of the Participant’s business or function measured against business or function goals; and

Ø	each Participant’s individual performance during the Performance Period.

o	People managers : 50% of the amount earned by the Participant under the terms of the Fiscal 2013 AIP (the “Award”) is based on development of people, team and personal development (including diversity); the remaining 50% is based on business results .

o	Non-managers : 75% of the Award is based on business results; the remaining 25% is based on personal development .

Ø	A Participant’s Award may be greater than 200% of his or her Target Incentive Opportunity.

Events Affecting Payout of Individual Awards:

·	If a Participant commences employment with the Company during the Performance Period, the Participant is eligible for a pro-rated Award reflecting the actual number of months worked by the Participant during the Performance Period (rounded to the nearest whole month).

·	If a Participant’s Target Incentive Opportunity changes during the Performance Period (by reason of a promotion or demotion or otherwise), the Participant is eligible for an Award reflecting the Target Incentive Opportunity in effect for the Participant on the last day of the Performance Period .

·	If a Participant’s base pay changes during the Performance Period, the Participant’s Award is based on the Participant’s base pay in effect on the last day of the Performance Period .

·

If a Participant transfers employment within the Company or to a subsidiary of the Company, the Participant’s Award will come from the unit, division or subsidiary in which the Participant is working as of the last day of the Performance Period. In such an event, the Participant’s performance for the entire Performance Period will be considered in determining the amount of the Participant’s Award.

·	A Participant who:

 

Ø

voluntarily resigns other than on account of “Retirement” forfeits all rights to the Participant’s Award unless the resignation occurs after the end of the Performance Period. “Retirement” is defined as a voluntary termination of employment on or after the attainment of age 55 and five years of employment with the Company and its affiliates.

 

Ø

involuntarily separates without cause (including by reason of poor performance), retires, dies, or becomes permanently disabled (under the terms of any disability income plan applicable to such Participant), is eligible to receive a prorated payment in respect of the Participant’s Award based on the Participant’s employment during the Performance Period (rounded to the nearest whole month), provided that the Participant worked at least three whole months during the Performance Period.

 

Ø

incurs a termination of employment for “cause” (as defined below), forfeits all rights to the Participant’s Award.  A termination of employment for “cause” is defined as an  involuntary termination of the Participant’s employment on account of the Participant engaging in (i) any willful or intentional neglect in performing the Participant’s duties, including, but not limited to, fraud, misappropriation or embezzlement involving property of the Company or an affiliate, or (ii) any other intentional wrongful act that may impair the goodwill or business of the Company or an affiliate, or that may cause damage to any of their businesses .

·	Continued eligibility for employees employed in the United States who become represented by a collective bargaining unit during the Performance Period will be determined by good faith bargaining .

·	Each Award granted to a Participant (to the extent earned) will be paid on or before November 15, 2013 (other payment dates may apply to Participants working outside the United States).

·	The Fiscal 2013 AIP, and any actions taken hereunder, shall be governed by and construed in accordance with the laws of the State of Delaware, without regard to the application of the conflicts of law provisions thereof or any other state.

Proposed Definition of Performance Metrics –

Fiscal 2013 Annual Incentive Plan

 

Sales

·	Defined in accordance with the Monsanto Company Statement of Consolidated Operations

Diluted Earnings Per Share (EPS)

·	Defined in accordance with the Monsanto Company Statement of Consolidated Operations

·	Items, either positive or negative, that are deemed to be extraordinary by the People and Compensation Committee of the Board of Directors are excluded for purposes of Earnings Per Share (but not Cash Flow) calculations

 

Ø	Restructuring charges and reversals

Ø	Impact of lawsuit outcomes

Ø	Impact of Solutia-related liabilities, expenses, settlements or agreements associated with Solutia’s reorganization plan

Ø	Impact of unbudgeted business sales/divestitures

Ø	Impact of changes in accounting rules

 

Cash Flow from Operating and Investing Activities

·	Defined in accordance with the Monsanto Company Statement of Consolidated Cash Flows

 

·	Items, either positive or negative, that are deemed to be extraordinary by the People and Compensation Committee of the Board of Directors are excluded for purposes of Cash Flow calculations

 

Ø	Impact of unbudgeted acquisitions

Ø	Impact of agreements associated with Solutia’s emergence from bankruptcy

 

 

5

Exhibit 10.2

 

 

Fiscal Year [20__] Stock Option Grant

 

Terms and Conditions

 

You have received an Award of Non-Qualified Options (the “Option”) under the Monsanto Company 2005 Long-Term Incentive Plan (as Amended and Restated as of January 24, 2012) (the “Plan”).  The Grant Date, the number of Shares covered by the Option, and the Exercise Price are set forth in the document you received entitled “Long-Term Incentive Statement.”  The Long-Term Incentive Statement and these terms and conditions collectively constitute the Award Certificate for the Option and describe the provisions applicable to the Option.  This Option is not intended to qualify as an “incentive stock option” as defined in Section 422 of the Code.

 

1.          Definitions .  Each capitalized term not otherwise defined herein has the meaning set forth in the Plan or, if not defined in the Plan, in the attached Long-Term Incentive Statement.  The “Company” means Monsanto Company, a Delaware corporation incorporated February 9, 2000.

 

2.          Exercisability .

(a)         The Option shall, subject to Sections 2(b) and 4, vest in accordance with the following schedule.

 

     portion of the Option

(b)         The provisions of this Section 2(b) shall govern vesting of the Option upon a Change of Control.

(i)         Upon a Change of Control, the Option, if outstanding, shall vest in full, except to the extent that another award meeting the requirements of Section 2(b)(ii) is provided to you to replace the Option (any award meeting the requirements of Section 2(b)(ii), a “Replacement Award”).

(ii)         An award shall meet the conditions of this Section 2(b)(ii) (and hence qualify as a Replacement Award) if: (1) it is a stock option or stock appreciation right in respect of publicly traded equity securities of the Company or the surviving corporation following the Change of Control, (2) it has a value at least equal to the value of this Option as of the date of

 

the Change of Control (other than in respect of customary fractional rounding of share amounts and exercise price), (3) it contains terms relating to vesting and exercisability (including with respect to Termination of Service) that are substantially identical to those of this Option, and (4) its other terms and conditions are not less favorable to you than the terms and conditions of this Option (including provisions that apply in the event of a subsequent Change of Control) as of the date of the Change of Control. Without limiting the generality of the foregoing, a Replacement Award may take the form of a continuation of this Option if the requirements of the preceding sentence are satisfied. The determination of whether the conditions of this Section 2(b)(ii) are satisfied shall be made by the Committee, as constituted immediately before the Change of Control, in its sole discretion.

(c)         Except as otherwise provided in the Plan, the Option may be exercised at any time after it vests and before its term expires or it is sooner forfeited as provided in Sections 3 and 4 below.

3.          Term .  The term of the Option shall, subject to Section 4, expire on the tenth anniversary of the Grant Date.

 

4.          Retirement, Disability, Death or Other Termination of Service; Transfer .   If you experience a Termination of Service for any reason before the first anniversary of the Grant Date (unless such Termination of Service follows a Change of Control), the Option shall be forfeited . If you experience a Termination of Service on or after the first anniversary of the Grant Date (or, if earlier, a Change of Control), including, without limitation, by reason of Retirement, death, Disability, or an involuntary termination other than a Termination for Cause, the Option shall vest and remain exercisable (or be forfeited) to the extent, and only to the extent, provided in this Section 4, notwithstanding any differing treatment set forth in the Plan.

 

(a)          Retirement .  If you experience a Termination of Service by reason of   Retirement (including by reason of a Termination without Cause) on or after the first anniversary of the Grant Date (or, if earlier, a Change of Control), the Option shall continue to vest on the schedule set forth in Section 2(a) and shall remain exercisable until the earlier of the fifth anniversary of the date of your Termination of Service or the tenth anniversary of the Grant Date, and then shall be forfeited to the extent not exercised.

(b)   Death or Disability . If you experience a Termination of Service as a result of death or Disability on or after the first anniversary of the Grant Date (or, if earlier, a Change of Control), the Option shall become fully vested and shall remain exercisable until the earlier of the first anniversary (or, if such Termination of Service occurs on or after your 55 th birthday and your completion of five years of service with the Company and any of its Subsidiaries and Affiliates, the fifth anniversary) of the date of your Termination of Service or the tenth anniversary of the Grant Date, and then shall be forfeited to the extent not exercised.

 

(c)          Termination for Cause .  If you experience a Termination for Cause, the Option, whether vested or not, shall immediately be forfeited.

 

(d)          Voluntary Termination; Certain Terminations Without Cause .  If you experience a voluntary Termination of Service (other than by reason of Retirement or a voluntary termination governed by Section 4(e)) or a Termination without Cause that is neither a Retirement nor governed by Section 4(e), then, to the extent the Option is vested on the date of your Termination of Service, it shall remain exercisable until the earlier of the 90th day after the date of your Termination of Service or the tenth anniversary of the Grant Date, and then shall be forfeited to the extent not exercised, and any portion of the Option that is not vested on the date of your Termination of Service shall be forfeited upon your Termination of Service.

 

(e)   Job Elimination; Termination Without Cause Following a Change of Control .   If you experience (x) a Termination without Cause due to a job-elimination or divestiture of the business, Affiliate or Subsidiary by which you were employed, on or after the first anniversary of the Grant Date, or (y) at any time following a Change of Control, either (1) a Termination without Cause or (2) a termination under circumstances entitling you to severance benefits under a constructive termination provision (including, without limitation, a “good reason” provision or a constructive “involuntary termination” provision) of an agreement, plan or program covering you, the Option shall become fully vested and shall remain exercisable until the earlier of the first anniversary (or, if such Termination of Service occurs on or after your 50 th birthday due to a job elimination or a divestiture of the business, Affiliate or Subsidiary by which you were employed, the fifth anniversary) of the date of your Termination of Service or the tenth anniversary of the Grant Date, and then shall be forfeited to the extent not exercised.

 

5.          Exercise Procedures .

 

(a)         You may exercise the Option at any time after the Option has vested and become exercisable by giving notice to the Company specifying the number of Shares for which the Option is being exercised.  The notice shall be provided to the Company’s Designated Administrator, in a manner set forth by the Company or the Designated Administrator for this purpose.  The “Designated Administrator” is the person or entity most recently specified by the Company as such for purposes of the Plan.

 

(b)         The purchase price for the Shares for which the Option is being exercised shall be paid in full at the time of exercise and any other information required by the Committee shall be provided at that time.  The purchase price shall be paid (i) in cash or by check, (ii) by tendering to the Designated Administrator whole Shares (but not fewer than 100 Shares), valued at their Fair Market Value on the date of exercise, or (iii) by any other method designated by the Committee.  The Committee may require payment in a particular or different method in order to comply with applicable law.

 

6.          Withholding .  In order for Shares to be delivered when you exercise the Option, you must make arrangements satisfactory to the Company for the payment of any taxes required to be paid or withheld in connection with the exercise of the Option.  No more than

 

the minimum required withholding will be permitted in the form of Shares.  While the Company reserves the right to modify the methods of tax withholding that it deems acceptable, as of the time that this Award Certificate is being delivered to you, tax withholding may be satisfied by (i) cash or check, (ii) delivery of Shares, or (iii) retention by the Company, sale to a third party or cancellation by the Company of Shares otherwise deliverable upon the Option exercise.

 

7.          Nontransferability .  The Option is not transferable by you other than upon death by will, the laws of descent and distribution, or written designation of a beneficiary.  The Option is exercisable, during your lifetime, only by you (or by your guardian or legal representative).  Any person who holds the Option is subject to the terms and con­ditions of this Award Certificate.  No transfer of the Option shall be effective to bind the Company unless the Company has been furnished with written notice of the transfer and appropriate evidence to establish the validity of the transfer and the acceptance by the transferee of the terms and conditions of this Award Certificate.

 

8.          No Right to Continued Employment or Service .  This Award Certificate shall not limit or restrict the right of the Company or any Affiliate to terminate your employment or service at any time or for any reason.

 

9.          Effect of Award Certificate; Severability .  This Award Certificate shall be binding upon and shall inure to the benefit of any successor of the Company and the person or entity to whom the Option may have been transferred by will, the laws of descent and distribution or beneficiary designation.  The invalidity or enforceability of any provision of this Award Certificate shall not affect the validity or enforceability of any other provision of this Award Certificate.  

 

10.      Amendment .  The terms and conditions of this Award Certificate may not be amended in a manner adverse to you without your consent.

 

11.      Discretionary Nature of the Plan.   You acknowledge and agree that the Plan is discretionary in nature and may be amended, cancelled, or terminated by the Company, in its sole discretion, at any time.  The grant of the Option under the Plan is a one-time benefit and does not create any contractual or other right to receive a grant of stock options or benefits in lieu of stock options in the future.  Future grants of stock options, if any, will be at the sole discretion of the Company, including, but not limited to, the timing of any grant, the number of stock options, vesting provisions, and the exercise price.

12.          Plan Interpretation .  This Award Certificate is subject to the provisions of the Plan, and all of the provisions of the Plan are hereby incorporated into this Award Certificate as provisions of this Option.  If there is a conflict between the provisions of this Award Certificate and the Plan, the provisions of the Plan (including, without limitation, those setting forth the consequences of a Change of Control) govern.  If there is any ambiguity in this Award Certificate, any term that is not defined in this Award Certificate, or any matters as to which this Award Certificate is silent, the Plan shall govern, including, without limitation, the provisions of the Plan addressing construction, governing law, and the powers of the Committee, among others, to (a) interpret the Plan, (b) prescribe, amend and rescind rules and regulations relating to the Plan, (c) make appropriate adjustments to the Option to reflect non-United States laws or customs or in the event of a corporate transaction, and (d) make all other determinations necessary or advisable for the administration of the Plan.

Exhibit 10.3

Fiscal Year [20__]

Financial Goal Restricted Stock Units

Terms and Conditions

 

You have received an Award of Restricted Stock Units (the “Units”) under the Monsanto Company 2005 Long-Term Incentive Plan (as Amended and Restated as of January 24, 2012) (the “Plan”).  The Grant Date and the number of Units initially covered by this Award (the “Initial Number of Units”) are set forth in the document you have received entitled “Long-Term Incentive Statement.”  The maximum number of Units that you may receive under this Award (the “Maximum Number of Units”) is two times the Initial Number of Units.  The Long-Term Incentive Statement and these terms and conditions collectively constitute the Award Certificate for the Units, and describe the provisions applicable to the Units.

 

1.          Definitions .  Each capitalized term not otherwise defined herein has the meaning set forth in the Plan or, if not defined in the Plan, in the attached Long-Term Incentive Statement.  The “Company” means Monsanto Company, a Delaware corporation incorporated February 9, 2000.

 

2.          Nature of Units .  The Units represent the right to receive, in certain circumstances, a number of Shares determined in accordance with the Long-Term Incentive Statement and these terms and conditions.  Until such time (if any) as Shares are delivered to you, you will not have any of the rights of a common stockholder of the Company with respect to those Shares, your rights with respect to the Units and those Shares will be those of a general creditor of the Company, and you may not sell, assign, transfer, pledge, hypothecate, give away, or otherwise dispose of the Units.  Any attempt on your part to dispose of the Units will result in their being forfeited.  However, you shall have the right to receive a cash payment (the “Dividend Equivalent Payment”) with respect to the Units (if any) that vest pursuant to this Award, subject to withholding pursuant to paragraph 6 below, in an amount equal to the aggregate cash dividends that would have been paid to you if you had been the record owner, on each record date for a cash dividend during the period from the Grant Date through the settlement date of the Units, of a number of Shares equal to the number of Units that vest under this Award.  The Dividend Equivalent Payment shall be made on such settlement date.  You shall not be entitled to receive any payments with respect to any non-cash dividends or other distributions that may be made with respect to the Shares.

 

3.          Vesting of Units .

 

(a)          162(m) Performance Goal .  Subject to Section 5, in order to vest in the Maximum Number of Units or any lesser number of Units under this Award, the 162(m) Performance Goal must be met (as determined and certified by the Committee following August 31, [20__] [third year after grant]).  The “162(m) Performance Goal” is that the Company ’ s Net Income, as defined in the next sentence, must exceed zero for the period from September 1, [20__] [year of grant] through August 31, [20__] [third year after grant].  “Net Income” means gross profit (i) minus (A) sales, general and

 

administrative expenses, (B) research and development expense, (C) amortization, (D) net interest expense, and (E) income taxes and (ii) plus or minus other income and expense; all as reported in the Company ’ s financial statements; but excluding positive or negative effects of (I) restructuring charges and reversals, (II) the outcome of lawsuits, (III) impact of liabilities, expenses or settlements related to Solutia, Inc. or agreements associated with a Solutia, Inc. plan of reorganization, (IV) unbudgeted business sales and divestitures, and (V) the cumulative effects of changes in accounting methodology made after August 31, [20__] [year of grant].

 

(b)          EPS, Cash Flow, and ROC Goals .  If the Section 162(m) Performance Goal is met, then the number of Units eligible for vesting under this Award will be determined one-third based upon the Company’s achievement of cumulative earnings per share (the “EPS Goal”), one-third based upon the Company’s achievement of cumulative cash flow (the “Cash Flow Goal”), and one-third based upon the Company’s achievement of return on capital (the “ROC Goal,” and, together with the EPS Goal and the Cash Flow Goal, the “Goals” and each, singularly, a “Goal”) for fiscal years [20__], [20__] and [20__] [three years after grant] as compared to the Goals set forth on Exhibit A hereto.  Not later than November 15, [20__] [third year after grant], the Committee will determine the extent to which the Goals have been met, the number of Units that have vested under this Award, and the number of Units to be forfeited, as follows:

Below Threshold-Level Performance :  For each Goal as to which performance is below threshold level, one-third of the Initial Number of Units shall be forfeited.

Above Threshold-Level/Below Target Performance :  For each Goal as to which performance is at or above threshold level but below target level, a number of Units that is equal to (i) one-third of the Initial Number of Units times (ii) the percentage determined by straight-line interpolating between 50% and 100%, based on the relationship between actual performance, threshold-level performance, and target-level performance for the applicable Goal, shall, subject to Section 3(c), vest as of November 15, [20__] [third year after grant].

 

Target-Level Performance :  For each Goal as to which target-level performance is achieved, one-third of the Initial Number of Units shall, subject to Section 3(c), vest as of November 15, [20__] [third year after grant].

 

Above Target-Level Performance :  For each Goal as to which greater than target-level performance is achieved, a number of Units that is equal to (i) one-third of the Initial Number of Units times (ii) the percentage determined by straight-line interpolating between 100% and 200%, based on the relationship between actual performance, target-level performance, and outstanding-level performance for the applicable Goal (for this purpose, performance above the outstanding level for the applicable Goal shall be deemed to be performance at such outstanding level) shall, subject to Section 3(c), vest as of November 15, [20__] [third year after grant].

 

(c)          Effect of Termination of Service .  If you incur a Termination of Service before November 15, [20__] [third year after grant] as a result of a Job Elimination (other than a Job Elimination subsequent to a Change of Control, which shall be governed by Section 5(d)), your Retirement, or your

 

Disability or death (each, a “Proration Event”), then effective as of November 15, [20__] [third year after grant], a number of Units shall vest, equal to (i) the number of Units (if any) that vest based upon the application of paragraphs (a) and (b) above (and, if applicable, taking into account Section 5(c)), times (ii) a fraction (the “Proration Fraction”), the numerator of which is the number of days from September 1, [20__] [year of grant] through your date of termination, and the denominator of which is 1172 (subject to the special rule of Section 5(c)(v) that applies in the event that a Change of Control occurs following such Termination of Service).  Except as provided in Section 5(d), if you incur a Termination of Service before November 15, [20__] [third year after grant] for any other reason, all Units subject to this Award shall be forfeited as of the date of such Termination of Service.

 

4.          Delivery of Shares .  The Company shall deliver to you a number of Shares equal to the number of Units (if any) that vest pursuant to this Award (except that in the event of settlement following conversion of this Award into a cash account pursuant to Section 5(a), delivery shall be in cash), subject to withholding as provided in paragraph 6 below.  Such delivery shall take place as soon as practicable, but in no event more than 15 days, after November 15, [20__] [third year after grant].  Notwithstanding the foregoing, with respect to a Termination of Service that is a “separation from service” within the meaning of Section 409A of the Code and that occurs during the two-year period following a Change of Control that qualifies as an event described in Section 409A(a)(2)(A)(v) of the Code and the regulations thereunder, such delivery shall take place as soon as practicable following the date of the applicable Termination of Service.  Nothing in this Agreement, including Section 5, shall preclude the Company from settling upon a Change of Control an Award that is not replaced by a Replacement Award (as defined below), to the extent effectuated in accordance with Treas. Regs. § 1.409A-3(j)(ix).

 

5.          Change of Control .  The provisions of this Section 5 shall govern vesting of this Award upon a Change of Control.

 

(a)         Upon the occurrence of a Change of Control, notwithstanding any other provision of this Award Certificate, the number of Units subject to this Award (determined in accordance with Section 5(c)) shall vest in full, except to the extent that another award meeting the requirements of Section 5(b) is provided to you to replace this Award (any award meeting the requirements of Section 5(b), a “Replacement Award”).  In the event that no Replacement Award is so provided to you, this Award shall be converted into a cash account (based on the number of Units as of the date of the Change of Control (determined in accordance with Section 5(c)) and the value per Share as of the Change of Control), which shall accrue interest at the applicable federal short-term rate provided for in Section 1274(d)(1)(A) of the Code, and be settled in accordance with Section 4 above.  For clarity, such account shall be fully vested as of the Change of Control, in no event shall the amount of such account be increased or decreased as a result of the circumstances of a subsequent Termination of Service, and the provisions of Section 2 relating to Dividend Equivalent Payments shall cease to apply following conversion of this Award into a cash account.

 

(b)         An award shall meet the conditions of this Section 5(b) (and hence qualify as a Replacement Award) if: (i) it is a restricted stock unit in respect of publicly traded equity

 

securities of the Company or the surviving corporation following the Change of Control, (ii) it has a value at least equal to the value of this Award as of the date of the Change of Control (determined in accordance with Section 5(c)) and provides for vesting based solely on continued service (with no performance conditions), (iii) it contains terms relating to vesting (including with respect to Termination of Service) that are substantially identical to those of this Award, and (iv) its other terms and conditions are not less favorable to you than the terms and conditions of this Award (including provisions that apply in the event of a subsequent Change of Control) as of the date of the Change of Control. Without limiting the generality of the foregoing, a Replacement Award may take the form of a continuation of this Award if the requirements of the preceding sentence are satisfied.  If a Replacement Award is granted, the Units shall not vest upon the Change of Control.  The determination of whether the conditions of this Section 5(b) are satisfied shall be made by the Committee, as constituted immediately before the Change of Control, in its sole discretion.

 

(c)         For purposes of this Section 5, the number of Units subject to this Award as of a Change of Control shall be determined in accordance with the following rules:

 

(i)         If the date of the Change of Control is after August 31, [20__] [year of grant] and prior to September 1, [20__] [first year after grant], the number of Units subject to this Award as of such Change of Control shall be the Initial Number of Units.

 

(ii)         If the date of the Change of Control is after August 31, [20__] [first year after grant] and prior to September 1, [20__] [second year after grant], the number of Units subject to this Award as of such Change of Control shall be the sum of (x) 67% of the Initial Number of Units plus (y) 33% of the number of Units that would have become eligible for vesting under Section 3(b) above, if Goal achievement were measured solely based upon the degree of achievement of the fiscal year [20__] [first year after grant] goals (assuming for this purpose that the Section 162(m) Performance Goal was achieved), the determination of such achievement to be made by the Committee no later than the date of the Change of Control, it being understood that to the extent that all necessary performance results are not available as of such date, the Committee shall make a good faith estimate.

 

(iii)         If the date of the Change of Control is after August 31, [20__] [second year after grant] and prior to September 1, [20__] [third year after grant], the number of Units subject to this Award as of such Change of Control shall be the sum of (x) 34% of the Initial Number of Units plus (y) 66% of the number of Units that would have become eligible for vesting under Section 3(b) above, if Goal achievement were measured solely based upon the degree of achievement of the fiscal year [20__] [first year after grant] and the fiscal year [20__] [second year after grant] goals (assuming for this purpose that the Section 162(m) Performance Goal was achieved), the determination of such achievement to be made by the Committee no later than the date of the Change of Control, it being understood that to the extent that all necessary performance results are not available as of such date, the Committee shall make a good faith estimate.

 

(iv)          If the date of the Change of Control is after August 31, [20__] [third year after grant] and on or before November 30, [20__] [third year after grant], the number of Units subject to this Award as of such Change of Control shall be determined pursuant to Section 3 based on actual performance (and the

 

Committee shall make the applicable performance determinations no later than the date of the Change of Control, it being understood that to the extent that all necessary performance results are not available as of such date, the Committee shall make a good faith estimate).

 

(v)         Notwithstanding the foregoing provisions of this Section 5(c), if you have incurred a Termination of Service that is a Proration Event before the date of a Change of Control, the number of Units subject to this Award as of such Change of Control shall be determined by multiplying the number of Units determined in accordance with the rules set forth in the preceding paragraphs of this Section 5(c) by the Proration Fraction.

 

(d)         If you experience (x) a Termination without Cause or (y) a termination under circumstances entitling you to severance benefits under a constructive termination provision (including, without limitation, a “good reason” provision or a constructive “involuntary termination” provision) of an agreement, plan or program covering you, in either case, at any time following a Change of Control, the applicable Replacement Award shall vest in full.

6.          Withholding .  Notwithstanding any other provision of this Award Certificate, your right to receive the Dividend Equivalent Payment and to receive Shares in settlement of any Units is subject to withholding of all taxes that are required to be paid or withheld in connection with such Dividend Equivalent Payment or the delivery of such Shares.  With respect to the delivery of Shares, you must make arrangements satisfactory to the Company for the payment of any such taxes.

 

7.          Recoupment Policy . Notwithstanding any other provision of this Award Certificate, this Award shall be subject to the terms of the Company’s Recoupment Policy, which is hereby incorporated herein by reference.

 

8.          No Right to Continued Employment or Service .  This Award Certificate shall not limit or restrict the right of the Company or any Affiliate to terminate your employment or service at any time or for any reason.

 

9.          Effect of Award Certificate; Severability .  This Award Certificate shall be binding upon and shall inure to the benefit of any successor of the Company.  The invalidity or enforceability of any provision of this Award Certificate shall not affect the validity or enforceability of any other provision of this Award Certificate.

 

10.          Amendment .  The terms and conditions of this Award Certificate may not be amended in any manner adverse to you without your consent.

 

11.             Plan Interpretation .  This Award Certificate is subject to the provisions of the Plan, and all of the provisions of the Plan are hereby incorporated into this Award Certificate.  If there is a conflict between the provisions of this Award Certificate and the Plan, the provisions of the Plan govern.  If there is any ambiguity in this Award Certificate, any term that is not defined in this Award Certificate, or any matters as to which this Award Certificate is silent, the Plan shall govern, including, without limitation, the provisions of the Plan addressing

 

construction and governing law, as well as the powers of the Committee, among others, to (a) interpret the Plan, (b) prescribe, amend and rescind rules and regulations relating to the Plan, (c) make appropriate adjustments to the Units in the event of a corporate transaction, and (d) make all other determinations necessary or advisable for the administration of the Plan .

Proposed Definition of Performance Metrics for Financial Goal RSUs

Fiscal [20__] – Fiscal [20__]

Diluted Earnings Per Share (EPS)

·	Defined in accordance with the Monsanto Company Statement of Consolidated Operations

·	Items, either positive or negative, that are deemed to be extraordinary by the People and Compensation Committee of the Board of Directors are excluded for purposes of Earnings Per Share (but not Cash Flow) calculations

Restructuring charges and reversals

Impact of lawsuit outcomes

Impact of Solutia-related liabilities, expenses, settlements or agreements associated with Solutia’s reorganization plan

Impact of unbudgeted business sales/divestitures

Impact of changes in accounting rules

Cash Flow from Operating and Investing Activities

·	Defined in accordance with the Monsanto Company Statement of Consolidated Cash Flows

·	Items, either positive or negative, that are deemed to be extraordinary by the People and Compensation Committee of the Board of Directors are excluded for purposes of Cash Flow calculations

Impact of unbudgeted acquisitions

Impact of agreements associated with Solutia’s emergence from bankruptcy

Return on Capital (ROC)

·	Earnings before interest and after taxes (EBIAT) divided by the average of the prior year-end and current year total assets less non-interest bearing liabilities, less excess cash (cash over $400,000,000)

ROC   =                                         EBIAT                                                                                                                                                       

    (Total Assets - non-interest bearing liabilities - excess cash)

·	Items, either positive or negative, that are deemed to be extraordinary by the People and Compensation Committee of the Board of Directors are excluded for purposes of Return on Capital calculations

Impact of unbudgeted acquisition

 

 

Exhibit 10.4

Fiscal Year [20__] Restricted Stock Units Grant

Terms and Conditions

You have received an Award of Restricted Stock Units (the “RSUs”) under the Monsanto Company 2005 Long-Term Incentive Plan (as Amended and Restated as of January 24, 2012) (the “Plan”).  The Grant Date and the number of RSUs covered by this Award are set forth in the document you received entitled “Long-Term Incentive Statement.”  The Long-Term Incentive Statement and these terms and conditions collectively constitute the Award Certificate for the RSUs, and describe the provisions applicable to the RSUs.

 

1.   Definitions .  Each capitalized term not otherwise defined herein has the meaning set forth in the Plan or, if not defined in the Plan, in the attached Long-Term Incentive Statement.  The “Company” means Monsanto Company, a Delaware corporation incorporated February 9, 2000.

 

2.   Nature of RSUs .  The RSUs represent the right to receive, in certain circumstances, a number of Shares determined in accordance with the Long-Term Incentive Statement and these terms and conditions.  Until such time (if any) as Shares are delivered to you, you will not have any of the rights of a common stockholder of the Company with respect to those Shares, your rights with respect to the RSUs and those Shares will be those of a general creditor of the Company, and you may not sell, assign, transfer, pledge, hypothecate, give away, or otherwise dispose of the RSUs.  Without limiting the generality of the foregoing, you shall have no voting or dividend equivalent rights with respect to the RSUs.  Any attempt on your part to dispose of the RSUs will result in their being forfeited.

 

3.   Vesting Schedule .  The RSUs shall vest on November 15, [20__] (the “Scheduled Vesting Date”), except as provided in Sections 4 and 5 below.

 

4.   Effect of Termination of Service .  If you experience a Termination of Service for any reason, all unvested RSUs subject to this Award shall, except as set forth otherwise in Sections 4 or 5, be forfeited as of the date of such Termination of Service, notwithstanding any differing treatment set forth in the Plan.  

 

(a)         If you experience a voluntary Termination of Service by reason of Retirement before the first anniversary of the Grant Date (unless such Termination of Service follows  a Change of Control), all unvested RSUs shall immediately be forfeited.  If you experience a voluntary Termination of Service by reason of Retirement on or after the first anniversary of the Grant Date (or, if earlier, a Change of Control), all outstanding RSUs shall immediately vest, and the Shares shall be delivered in accordance with Section 6.

 

(b)         If you experience a Termination of Service as a result of death or Disability prior to the first anniversary of the Grant Date (unless such Termination of Service follows a Change of Control), all unvested RSUs shall immediately be forfeited.  If you experience a Termination of Service as a result of death or Disability on or after the first anniversary of the Grant Date (or, if earlier, a Change of Control), all outstanding RSUs shall immediately vest, and the Shares shall be delivered in accordance with Section 6.

 

(c)         If you experience a Termination without Cause prior to the first anniversary of the Grant Date, all unvested RSUs shall immediately be forfeited.  If you experience a Termination without Cause on or after the first anniversary of the Grant Date, that number of unvested RSUs equal to the number of unvested RSUs multiplied by the Vesting Fraction (determined as set forth below) shall immediately vest, and any remaining unvested RSUs shall immediately be forfeited.  For purposes of this paragraph, if you experience a Termination without Cause on or after the first anniversary of the Grant Date (i) either (x) on or after your 55th birthday and your completion of five years of service with the Company and any of its Subsidiaries and Affiliates, or (y) due to a job-elimination program or divestiture of the Affiliate or Subsidiary of the Company by which you are employed, the Vesting Fraction shall equal one, or (ii) under any other circumstances, the Vesting Fraction shall be equal to a fraction, the numerator of which is the number of days from the Grant Date through the date of your involuntary Termination of Service, and the denominator of which is the number of days from the Grant Date through the Scheduled Vesting Date, provided , however , that in the event the product of the number of unvested RSUs multiplied by the Vesting Fraction is not a whole number, the number of RSUs that shall vest shall be rounded up to the next whole number. Delivery of Shares shall be made in accordance with Section 6.  Notwithstanding the foregoing, treatment of the RSUs upon a Termination without Cause following a Change of Control shall be governed by Section 5(c).

 

(d)         If you experience a Termination for Cause, all unvested RSUs shall immediately be forfeited.

5.   Change in Control .  The provisions of this Section 5 shall govern vesting of this Award upon a Change of Control.

 

(a)         Upon the occurrence of a Change of Control, notwithstanding any other provision of this Award, the RSUs shall vest in full, except to the extent that another award meeting the requirements of Section 5(b) is provided to you to replace this Award (any award meeting the requirements of Section 5(b), a “Replacement Award”).  In the event that no Replacement Award is so provided to you, this Award shall be converted into a cash account (based on the number of RSUs as of the date of the Change of Control and the value per Share as of the Change of Control), which shall accrue interest at the applicable federal short-term rate provided for in Section 1274(d)(1)(A) of the Code, and be settled in accordance with Section 6 below.  For clarity, such account shall be fully vested as of the Change of Control, in no event shall the amount of such account be increased or decreased as a result of the circumstances of a subsequent Termination of Service.

 

                   (b)         An award shall meet the conditions of this Section 5(b) (and hence qualify as a Replacement Award) if: (i) it is a restricted stock unit in respect of publicly traded equity securities of the Company or the surviving corporation following the Change of Control, (ii) it has a value at least equal to the value of this Award as of the date of the Change of Control, (iii) it contains terms relating to vesting (including with respect to Termination of Service) that are substantially identical to those of this Award, and (iv) its other terms and conditions are not less favorable to you than the terms and conditions of this Award (including provisions that apply in the event of a subsequent Change of Control) as of the date of the Change of Control. Without limiting the generality of the foregoing, a Replacement Award may take the form of a continuation of this Award if the requirements of the preceding sentence are satisfied.  If a Replacement Award is granted, the RSUs shall not vest upon the Change of Control.  The determination of whether the conditions of this Section 5(b) are satisfied shall be made by the Committee, as constituted immediately before the Change of Control, in its sole discretion.

 

(c)         Notwithstanding any other provision hereof, if you experience (x) a Termination without Cause or (y) a termination under circumstances entitling you to severance benefits under a constructive termination provision (including, without limitation, a “good reason” provision or a constructive “involuntary termination” provision) of an agreement, plan or program covering you, in either case, at any time following a Change of Control, the applicable Replacement Award shall vest in full, and the Shares shall be delivered in accordance with Section 6.

 

6.   Delivery of Shares .  The Company shall deliver to you a number of Shares equal to the number of RSUs (if any) that vest pursuant to this Award (except that in the event of settlement following conversion of this Award into a cash account pursuant to Section 5(a), delivery shall be in cash), subject to withholding as provided in paragraph 7 below.  Such delivery shall take place as soon as practicable, but in no event more than 90 days, after the Scheduled Vesting Date.  Notwithstanding any other provision of this Award, with respect to a Termination of Service that is a “separation from service” within the meaning of Section 409A of the Code and that occurs during the two-year period following a Change of Control that qualifies as an event described in Section 409A(a)(2)(A)(v) of the Code and the regulations thereunder, such delivery shall take place as soon as practicable following the date of the applicable Termination of Service. Nothing in this Award Certificate, including Section 5, shall preclude the Company from settling upon a Change of Control the Award if it is not replaced by a Replacement Award, to the extent effectuated in accordance with Treas. Regs. § 1.409A-3(j)(ix).

 

7.   Withholding .  Notwithstanding any other provision of this Award Certificate, your right to receive Shares in settlement of any RSUs is subject to withholding of all taxes that are required to be paid or withheld in connection with the delivery of those Shares.  Unless the Committee determines otherwise, withholding of taxes in connection with the delivery of Shares in settlement of the RSUs shall be satisfied by withholding by the Company of that number of whole Shares having a Fair Market Value on the date of withholding equal to the minimum amount required to be withheld.

 

8.   No Right to Continued Employment or Service .  This Award Certificate shall not limit or restrict the right of the Company or any Subsidiary or Affiliate to terminate your employment or service at any time or for any reason.

 

9.   Effect of Award Certificate; Severability .  This Award Certificate shall be binding upon and shall inure to the benefit of any successor of the Company.  The invalidity or enforceability of any provision of this Award Certificate shall not affect the validity or enforceability of any other provision of this Award Certificate.

 

10.   Amendment .  The terms and conditions of this Award Certificate may not be amended in any manner adverse to you without your consent.

 

11.   Plan Interpretation .  Except as otherwise provided herein, this Award Certificate is subject to the provisions of the Plan, and all of the provisions of the Plan are hereby incorporated into this Award Certificate as provisions of the RSUs.  If there is a conflict between the provisions of this Award Certificate and the Plan, the provisions of the Plan govern (except as provided otherwise in this Award Certificate).  If there is any ambiguity in this Award Certificate, any term that is not defined in this Award Certificate, or any matters as to which this Award Certificate is silent, the Plan shall govern, including, without limitation, the provisions of the Plan addressing construction and governing law, as well as the powers of the Committee, among others, to (a) interpret the Plan, (b) prescribe, amend and rescind rules and regulations relating to the Plan, (c) make appropriate adjustments to the RSUs in the event of a corporate transaction, and (d) make all other determinations necessary or advisable for the administration of the Plan.

 

 

 

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