{"id":40012,"date":"2015-09-17T11:25:58","date_gmt":"2015-09-17T16:25:58","guid":{"rendered":"https:\/\/content.findlaw-admin.com\/ability-legal\/contracts\/uncategorized\/incentive-plan-monsanto-co.html"},"modified":"2015-09-17T11:25:58","modified_gmt":"2015-09-17T16:25:58","slug":"incentive-plan-monsanto-co","status":"publish","type":"corporate_contracts","link":"https:\/\/corporate.findlaw.com\/contracts\/compensation\/incentive-plan-monsanto-co.html","title":{"rendered":"Incentive Plan – Monsanto Co."},"content":{"rendered":"

Fiscal 2012 Annual Incentive Plan<\/strong><\/p>\n

\n

(September 1, 2011 through August 31, 2012 Performance
\nPeriod)<\/strong><\/p>\n

\n<\/p>\n

The Fiscal 2012 Annual Incentive Plan (the “Plan”) provides eligible
\nemployees the opportunity to earn cash awards for Company and individual
\nperformance during the Performance Period<\/p>\n<\/p>\n<\/p>\n

Performance Period<\/u><\/strong>: the Company153s 2012 fiscal year –
\nSeptember 1, 2011 through August 31, 2012 (the “Performance Period”).<\/p>\n<\/p>\n<\/p>\n

Eligibility<\/u><\/strong>: All regular employees of Monsanto
\nCompany and its subsidiaries who do not participate in a sales or a
\nbusiness-specific annual incentive plan (each such employee, a “Participant”).\n<\/p>\n<\/p>\n<\/p>\n

Performance Goals<\/u><\/strong>:<\/p>\n<\/p>\n<\/p>\n\n\n\n
\n

–<\/p>\n<\/td>\n

\n

The People and Compensation Committee of the Board of Directors (the
\n“Committee”) establishes Threshold, Target and Outstanding levels of attainment
\nfor the Performance Period relating to the following financial goals (each, a
\n“Financial Goal”):<\/p>\n<\/td>\n<\/tr>\n<\/tbody>\n<\/table>\n<\/p>\n\n\n\n\n
\n

\n<\/td>\n

\n

Net Sales (weighted 10%);<\/p>\n<\/td>\n<\/tr>\n

\n

\n<\/td>\n

\n

Diluted Earnings Per Share (“EPS”) (weighted 50%); and<\/p>\n<\/td>\n<\/tr>\n<\/tbody>\n<\/table>\n<\/p>\n\n\n\n
\n

\n<\/td>\n

\n

Free Cash Flow (“Cash Flow”) (weighted 40%).<\/p>\n<\/td>\n<\/tr>\n<\/tbody>\n<\/table>\n<\/p>\n\n\n\n
\n

–<\/p>\n<\/td>\n

\n

Each Participant also has individual performance goals relating to business
\nand\/or people initiatives.<\/p>\n<\/td>\n<\/tr>\n<\/tbody>\n<\/table>\n<\/p>\n

General Provisions<\/u><\/strong>:<\/p>\n<\/p>\n<\/p>\n\n\n\n
\n

–<\/p>\n<\/td>\n

\n

Each Participant is provided a “Target Incentive Opportunity” for the
\nPerformance Period, expressed as a percentage of base pay in effect as of the
\nlast day of the Performance Period (i.e., August 31, 2012).<\/p>\n<\/td>\n<\/tr>\n<\/tbody>\n<\/table>\n<\/p>\n\n\n\n
\n

–<\/p>\n<\/td>\n

\n

The Plan153s “Target Award Pool” is the sum of the dollar amount of all
\nParticipants153 Target Incentive Opportunities.<\/p>\n<\/td>\n<\/tr>\n<\/tbody>\n<\/table>\n

Plan Funding<\/u><\/strong>:<\/p>\n<\/p>\n<\/p>\n\n\n\n
\n

–<\/p>\n<\/td>\n

\n

After the end of the Performance Period, the Committee determines in its sole
\ndiscretion its calculation of the “Funding Factor,” which represents the
\npercentage attainment (on a weighted average basis) of the three Financial Goals
\n(Net Sales, EPS and Cash Flow) based on the Company153s performance against each
\nof the Financial Goals for the Performance Period, as follows:<\/p>\n<\/td>\n<\/tr>\n<\/tbody>\n<\/table>\n<\/p>\n

1<\/p>\n

\n\n\n\n\n\n\n
\n

Performance Level<\/strong><\/p>\n<\/td>\n

\n

Potential Award Pool Funding<\/strong><\/p>\n

(As a Percent of Target Award Pool)<\/strong><\/p>\n<\/td>\n<\/tr>\n

\n

Threshold<\/p>\n<\/td>\n

\n

35%<\/p>\n<\/td>\n<\/tr>\n

\n

Target<\/p>\n<\/td>\n

\n

100%<\/p>\n<\/td>\n<\/tr>\n

\n

Outstanding<\/p>\n<\/td>\n

\n

200%<\/p>\n<\/td>\n<\/tr>\n<\/tbody>\n<\/table>\n<\/p>\n\n\n\n
\n

–<\/p>\n<\/td>\n

\n

The Funding Factor is multiplied by the Plan153s Target Award Pool to determine
\nthe amount of the fiscal 2012 Award Pool.<\/p>\n<\/td>\n<\/tr>\n<\/tbody>\n<\/table>\n<\/p>\n\n\n\n
\n

–<\/p>\n<\/td>\n

\n

Special considerations for the Committee to follow when determining funding
\nof the Award Pool in its sole discretion:<\/p>\n<\/td>\n<\/tr>\n<\/tbody>\n<\/table>\n<\/p>\n\n\n\n
\n

\n<\/td>\n

\n

The Committee may, in its sole discretion, consider subjective factors in
\ndetermining whether or not any Financial Goal has been attained and the amount
\nof Award Pool funding with respect to each Financial Goal, if any.<\/p>\n<\/td>\n<\/tr>\n<\/tbody>\n<\/table>\n<\/p>\n\n\n\n
\n

\n<\/td>\n

\n

The Award Pool will fund at 20% of Target-level funding in the event the
\nCompany pays dividends with respect to each of its fiscal quarters ending during
\nthe fiscal year. However, if the Company fails to attain at least the
\nThreshold-level of performance with respect to the EPS Financial Goal for the
\nPerformance Period, the Award Pool may not be funded at a level greater than 20%
\nof Target-level funding.<\/p>\n<\/td>\n<\/tr>\n<\/tbody>\n<\/table>\n<\/p>\n\n\n\n
\n

\n<\/td>\n

\n

One or more of the Financial Goals may be funded at above Outstanding-level
\nfunding if the Committee determines in its sole discretion that Company
\nperformance with respect to such Financial Goal warrants such funding; provided,
\nhowever, the overall funding of the Award Pool is capped at 200% of Target-level
\nfunding unless the Committee determines in its sole discretion to fund above
\n200%.<\/p>\n<\/td>\n<\/tr>\n<\/tbody>\n<\/table>\n<\/p>\n\n\n\n
<\/td>\n\n

Allocation of the Award Pool<\/u><\/strong>:<\/strong><\/p>\n<\/td>\n<\/tr>\n<\/tbody>\n<\/table>\n<\/p>\n\n\n\n
\n

–<\/p>\n<\/td>\n

\n

The Award Pool is allocated among Participants based upon:<\/p>\n<\/td>\n<\/tr>\n<\/tbody>\n<\/table>\n<\/p>\n\n\n\n
\n

\n<\/td>\n

\n

each Participant153s Target Annual Incentive Opportunity for the Performance
\nPeriod;<\/p>\n<\/td>\n<\/tr>\n<\/tbody>\n<\/table>\n<\/p>\n\n\n\n
\n

\n<\/td>\n

\n

performance of each Participant153s business or function measured against
\nbusiness or function goals; and<\/p>\n<\/td>\n<\/tr>\n<\/tbody>\n<\/table>\n<\/p>\n\n\n\n\n\n
\n

\n<\/td>\n

\n

each Participant153s individual performance during the Performance Period.<\/p>\n<\/td>\n<\/tr>\n

\n

o<\/p>\n<\/td>\n

\n

People managers<\/u><\/em>: 50% of the amount earned by a Participant
\nunder the terms of the Plan (the “Award”) is based on development of people,
\nteam and personal development (including diversity); the remaining 50% is based
\non business results.<\/p>\n<\/td>\n<\/tr>\n

<\/td>\n<\/td>\n<\/td>\n<\/tr>\n<\/tbody>\n<\/table>\n

2<\/p>\n

\n<\/p>\n\n\n\n
\n

o<\/p>\n<\/td>\n

\n

Non-managers<\/u><\/em>: 75% of the Award is based on business results;
\nthe remaining 25% is based on personal development.<\/p>\n<\/td>\n<\/tr>\n<\/tbody>\n<\/table>\n<\/p>\n\n\n\n
\n

–<\/p>\n<\/td>\n

\n

A Participant153s Award may be greater than 200% of his or her Target Incentive
\nOpportunity.<\/p>\n<\/td>\n<\/tr>\n<\/tbody>\n<\/table>\n<\/p>\n

Events Affecting Payout of Individual Awards:<\/u><\/strong><\/p>\n<\/p>\n<\/p>\n\n\n\n
\n

–<\/p>\n<\/td>\n

\n

If a Participant commences employment with the Company during the Performance
\nPeriod, the Participant is eligible for a pro-rated Award reflecting the actual
\nnumber of months worked by the Participant during the Performance Period
\n(rounded to the nearest whole month).<\/p>\n<\/td>\n<\/tr>\n<\/tbody>\n<\/table>\n<\/p>\n\n\n\n
\n

–<\/p>\n<\/td>\n

\n

If a Participant153s Target Incentive Opportunity changes during the
\nPerformance Period (by reason of a promotion or demotion or otherwise), the
\nParticipant is eligible for an Award reflecting the Target Incentive Opportunity
\nin effect for the Participant on the last day of the Performance Period.<\/p>\n<\/td>\n<\/tr>\n<\/tbody>\n<\/table>\n<\/p>\n\n\n\n
\n

–<\/p>\n<\/td>\n

\n

If a Participant153s base pay changes during the Performance Period, the
\nParticipant153s Award is based on the Participant153s base pay in effect on the last
\nday of the Performance Period.<\/p>\n<\/td>\n<\/tr>\n<\/tbody>\n<\/table>\n<\/p>\n\n\n\n
\n

–<\/p>\n<\/td>\n

\n

If a Participant transfers employment within the Company or to a subsidiary
\nof the Company, the Participant153s Award will come from the unit, division or
\nsubsidiary in which the Participant is working as of the last day of the
\nPerformance Period. In such an event, the Participant153s performance for the
\nentire Performance Period will be considered in determining the amount of the
\nParticipant153s Award.<\/p>\n<\/td>\n<\/tr>\n<\/tbody>\n<\/table>\n<\/p>\n\n\n\n\n\n
\n

–<\/p>\n<\/td>\n

\n

A Participant who:<\/p>\n<\/td>\n<\/tr>\n

\n

\n<\/td>\n

\n

voluntarily resigns other than on account of “Retirement” forfeits all rights
\nto the Participant153s Award unless the resignation occurs after the end of the
\nPerformance Period. “Retirement” is defined as a voluntary termination of
\nemployment on or after the attainment of age 55 and five years of employment
\nwith the Company and its affiliates.<\/p>\n<\/td>\n<\/tr>\n

<\/td>\n<\/td>\n<\/td>\n<\/tr>\n<\/tbody>\n<\/table>\n<\/p>\n\n\n\n
\n

\n<\/td>\n

\n

involuntarily separates without cause (including by reason of poor
\nperformance), retires, dies, or becomes permanently disabled (under the terms of
\nany disability income plan applicable to such Participant), is eligible to
\nreceive a prorated payment in respect of the Participant153s Award based on the
\nParticipant153s employment during the Performance Period (rounded to the nearest
\nwhole month), provided that the Participant worked at least three whole months
\nduring the Performance Period.<\/p>\n<\/td>\n<\/tr>\n<\/tbody>\n<\/table>\n

3<\/p>\n

\n\n\n\n
\n

\n<\/td>\n

\n

incurs a termination of employment for “cause” (as defined below), forfeits
\nall rights to the Participant153s Award. A termination of employment for “cause”
\nis defined as an involuntary termination of the Participant153s employment on
\naccount of the Participant engaging in (i) any willful or intentional neglect in
\nperforming the Participant153s duties, including, but not limited to, fraud,
\nmisappropriation or embezzlement involving property of the Company or an
\naffiliate, or (ii) any other intentional wrongful act that may impair the
\ngoodwill or business of the Company or an affiliate, or that may cause damage to
\nany of their businesses.<\/p>\n<\/td>\n<\/tr>\n<\/tbody>\n<\/table>\n<\/p>\n\n\n\n
\n

–<\/p>\n<\/td>\n

\n

Continued eligibility for employees employed in the United States who become
\nrepresented by a collective bargaining unit during the Performance Period will
\nbe determined by good faith bargaining.<\/p>\n<\/td>\n<\/tr>\n<\/tbody>\n<\/table>\n<\/p>\n\n\n\n
\n

– <\/strong><\/p>\n<\/td>\n

\n

Each Award granted to a Participant (to the extent earned) will be paid on or
\nbefore November 15, 2012 (other payment dates may apply to Participants working
\noutside the United States).<\/p>\n<\/td>\n<\/tr>\n<\/tbody>\n<\/table>\n<\/p>\n\n\n\n
\n

– <\/strong><\/p>\n<\/td>\n

\n

This Plan, and any actions taken hereunder, shall be governed by and
\nconstrued in accordance with the laws of the State of Delaware, without regard
\nto the application of the conflicts of law provisions thereof or any other
\nstate.<\/p>\n<\/td>\n<\/tr>\n<\/tbody>\n<\/table>\n<\/p>\n<\/p>\n<\/p>\n<\/p>\n

4<\/p>\n

\n<\/p>\n

Definition of Performance Metrics :<\/strong><\/p>\n

\n

Fiscal 2012 Annual Incentive Plan<\/strong><\/p>\n

\n<\/p>\n

Sales<\/u><\/strong><\/p>\n<\/p>\n<\/p>\n\n\n\n
\n

– <\/strong><\/p>\n<\/td>\n

\n

Defined in accordance with the Monsanto Company Statement of Consolidated
\nOperations<\/p>\n<\/td>\n<\/tr>\n<\/tbody>\n<\/table>\n<\/p>\n\n\n\n
\n

<\/strong><\/p>\n<\/td>\n

\n

Sales equals gross sales less normal sales deductions (e.g., sales returns
\nand allowances, volume related customer payments, duty and freight)<\/p>\n<\/td>\n<\/tr>\n<\/tbody>\n<\/table>\n<\/p>\n\n\n\n
\n

o<\/p>\n<\/td>\n

\n

Gross sales includes technical fees associated with marketing seed traits,
\nexternal royalty income and financing income from the extension of credit on our
\nsales<\/p>\n<\/td>\n<\/tr>\n<\/tbody>\n<\/table>\n<\/p>\n

Diluted Earnings Per Share (EPS)<\/u><\/strong><\/p>\n<\/p>\n<\/p>\n\n\n\n
\n

–<\/p>\n<\/td>\n

\n

Defined in accordance with the Monsanto Company Statement of Consolidated
\nOperations<\/p>\n<\/td>\n<\/tr>\n<\/tbody>\n<\/table>\n<\/p>\n\n\n\n\n\n
\n

–<\/p>\n<\/td>\n

\n

Items, either positive or negative, that are deemed to be extraordinary by
\nthe People and Compensation Committee of the Board of Directors are
\nexcluded<\/u> for purposes of Earnings Per Share (but not Cash Flow)
\ncalculations<\/p>\n<\/td>\n<\/tr>\n

\n

\n<\/td>\n

\n

Restructuring charges and reversals<\/p>\n<\/td>\n<\/tr>\n

<\/td>\n<\/td>\n<\/td>\n<\/tr>\n<\/tbody>\n<\/table>\n<\/p>\n\n\n\n\n
\n

\n<\/td>\n

\n

Impact of lawsuit outcomes<\/p>\n<\/td>\n<\/tr>\n

\n

\n<\/td>\n

\n

In process R&D write-offs on acquisitions<\/p>\n<\/td>\n<\/tr>\n<\/tbody>\n<\/table>\n<\/p>\n\n\n\n\n
\n

\n<\/td>\n

\n

Impact of Solutia-related liabilities, expenses, settlements or agreements
\nassociated with Solutia153s reorganization plan<\/p>\n<\/td>\n<\/tr>\n

\n

\n<\/td>\n

\n

Impact of unbudgeted business sales\/divestitures<\/p>\n<\/td>\n<\/tr>\n<\/tbody>\n<\/table>\n<\/p>\n\n\n\n
\n

\n<\/td>\n

\n

Impact of changes in accounting rules<\/p>\n<\/td>\n<\/tr>\n<\/tbody>\n<\/table>\n<\/p>\n

Cash Flow from Operating and Investing Activities<\/u><\/strong><\/p>\n<\/p>\n<\/p>\n\n\n\n
\n

–<\/p>\n<\/td>\n

\n

Defined in accordance with the Monsanto Company Statement of Consolidated
\nCash Flows<\/p>\n<\/td>\n<\/tr>\n<\/tbody>\n<\/table>\n<\/p>\n\n\n\n\n\n
\n

–<\/p>\n<\/td>\n

\n

Items, either positive or negative, that are deemed to be extraordinary by
\nthe People and Compensation Committee of the Board of Directors are
\nexcluded<\/u> for purposes of Cash Flow calculations<\/p>\n<\/td>\n<\/tr>\n

\n

\n<\/td>\n

\n

Impact of acquisitions<\/p>\n<\/td>\n<\/tr>\n

<\/td>\n<\/td>\n<\/td>\n<\/tr>\n<\/tbody>\n<\/table>\n<\/p>\n\n\n\n
\n

\n<\/td>\n

\n

Impact of agreements associated with Solutia153s emergence from bankruptcy<\/p>\n<\/td>\n<\/tr>\n<\/tbody>\n<\/table>\n<\/p>\n

5<\/p>\n

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