EXHIBIT 99.1
PURCHASE AGREEMENT AMONG MYCOGEN, AGRIGENETICS, INC. AND
DELTA AND PINE LAND COMPANY, DATED FEBRUARY 15, 1995
PURCHASE AGREEMENT
This Purchase Agreement dated as of February 15, 1995, is made and entered into
by and between Mycogen Corporation ("Mycogen") and its subsidiary Agrigenetics,
Inc. doing business as Mycogen Plant Sciences ("MPS"), and Delta and Pine Land
Company ("DPL").
Mycogen and MPS desire to purchase DPL's corn and sorghum business for the
benefit of MPS and DPL desires to sell such business to MPS. The parties
contemplate consummating such a transaction in three components. One component
involves the exchange of certain facilities located in Lubbock, Texas owned by
MPS for certain facilities located in Plainview and Dumas, Texas owned by DPL.
Another component involves the acquisition by MPS of DPL's planting and
foundation seed germplasm and contracts associated with DPL's corn and sorghum
business. The final component involves an arrangement for the sale of DPL's
current corn and sorghum inventories.
NOW, THEREFORE, the parties hereby agree as follows:
ARTICLE I
EXCHANGE OF FACILITIES
1.1 EXCHANGE OF PROPERTY. MPS and DPL hereby agree that on June 30, 1995
(the "Property Closing Date"), MPS and DPL, subject to the terms and
conditions set forth under this Article I, will consummate the exchange of
the following properties (the "Exchange"):
(i) MPS will convey to DPL, MPS's facilities and, except as set forth
on Schedule 1.1A, all fixed assets located at and used predominantly
in connection with the operation of such facilities located at 624
27th Street and 6201 Southeast Loop #289, Lubbock, Texas (the "MPS
Property"); and
(ii) DPL will convey to MPS, DPL's facilities and, except as set forth
on Schedule 1.1B, all fixed assets located at and used predominantly
in connection with the operation of such facilities located at 3600
North Columbia Street, Plainview, Texas, and Highway 152, Dumas,
Texas (the "DPL Property").
Each party will keep their own rolling stock and, as to be agreed upon by
the parties, certain portable assets (such as furniture, computers,
supplies, etc.). Each party will be responsible for removing all of their
own rolling stock and agreed-upon portable assets from their facilities on
or before the Property Closing Date.
1.2 OPERATION OF PROPERTIES PRIOR TO THE EXCHANGE. Prior to the Property
Closing Date, each party will continue to operate its own facilities at its
own cost.
1.3 MISCELLANEOUS COSTS.
(a) Each party will pay the cost of recording the warranty deed to the
property being acquired by such party.
(b) Each party will pay (i) the cost of preparing its warranty deed to
be delivered to the other party and any documentary transfer tax on
its warranty deed, and (ii) the cost of an ALTA policy of title
insurance as described in Section 1.4(b) hereof.
(c) Any other costs to effect the Exchange will be apportioned in a
manner that is customary in the county where each of the MPS Property
and the DPL Property, respectively, are located.
EXHIBIT 99.1
1.4 CONDITIONS OF CLOSING. On the Property Closing Date, MPS (with respect
to the MPS Property) and DPL (with respect to the DPL Property) will
deliver to the other party the following items, which must be satisfied to
effect the Exchange:
(a) Subject to any exceptions and limitations set forth in the title
insurance policy accepted by the acquiring party in accordance with
Section 1.4(b) and (c), a warranty deed conveying title to such
property to the acquiring party.
(b) An ALTA standard policy of title insurance issued by a nationally
recognized title company with liability in the amount of the value of
the property as reflected in the financial records of MPS or, as the
case may be, DPL showing title to such property as set forth in
Section 1.1 above, subject only to:
(i) Nondelinquent real property taxes, assessments, and
improvement bonds;
(ii) Utility, drainage and slope easements affecting such
property that may be approved by the acquiring party in
accordance with Section 1.4(c) below;
(iii) Such liens, licenses, easements, encumbrances, covenants,
conditions and restrictions and other matters of record that may
be approved by the acquiring party in accordance with Section
1.4(c) below; and
(iv) A reservation of the mineral estate under such property so
long as such reservation shall not include the right to use the
surface of such property or the upper 500 feet of the land
lying below the surface thereof; and
(v) Any other similar exceptions to title that do not interfere
with the operation of the MPS Property and the DPL Property,
respectively, as currently conducted.
(c) As soon as possible after the date of this Agreement, MPS (with
respect to the MPS Property) and DPL (with respect to the DPL
Property) will deliver to the other party the following items:
(i) A standard preliminary title commitment for a dollar amount
equal to the book value of such property as reflected on the
financial records of MPS and DPL, respectively (the "Title
Commitment") issued by a nationally recognized title company
showing the status of the title of such property;
(ii) A copy of all existing leases and management, maintenance,
security and other contracts pertaining to such property
("Contracts"), which Contracts are listed on Schedule 1.4; and
(iii) Recorded tract map and other data pertaining to such
property which are in the possession of, or are available
without cost to, MPS or, as applicable, DPL.
Within 30 days of each party's receipt of the other party's Title
Commitment, the receiving party will notify the delivering party in
writing of any unacceptable exceptions in the Title Commitment so
that the receiving party may attempt to secure the removal thereof.
Failure to disapprove in writing any such exceptions within said 30
day period will be deemed approval thereof.
Each party will use diligent efforts to remove within 60 days of
disapproval any exceptions to title disapproved by the acquiring
party. In the event that any such disapproved exceptions to title
cannot be removed to the acquiring party's satisfaction within such
60 day period, the parties will negotiate a mutually acceptable
remedy to compensate and protect the acquiring party from risks
associated with such disapproved exception to title.
MPS will accept by assignment the DPL Contract listed on Schedule 1.4.
There are no Contracts associated with the MPS Property to be
assigned to DPL.
(d) Any other instruments and documents customary in the respective
counties in Texas where the MPS Property and the DPL Property are
located in order to effect the exchange.
EXHIBIT 99.1
(e) A certificate duly executed by each party certifying that the
representations and warranties of such party as set forth under
Section 1.6 are true and correct as of the Property Closing Date.
(f) Satisfaction of the obligations with respect to environmental
matters as set forth under Section 1.7.
1.5 POSSESSION, PRORATIONS AND CASUALTY.
(a) Each party will be entitled to possession of the property to be
acquired by such party under the terms of this Agreement upon the
exchange of deeds under Section 1.4(a) above.
(b) Real property taxes and assessments on each of the MPS Property and
the DPL Property will be prorated as of the Property Closing Date.
Said prorations to be based on a 30-day month and a 360-day year
and the actual taxes for the most recent year available.
(c) In the event of any casualty to the MPS Property or the DPL
Property, the acquiring party will have the right to elect to have
the selling party repair and restore the damage caused by such
casualty or to accept such damaged property with any insurance
proceeds collectable with respect to such casualty.
1.6 REPRESENTATIONS, WARRANTIES AND COVENANTS.
(a) MPS, as the acquirer of the DPL Property, and DPL, as the acquirer
of the MPS Property, hereby represent, warrant and covenant as
follows:
(i) Each party represents that there have been no
representations or warranties by the other party other than
those specified in this Agreement concerning the property being
acquired by such party under this Agreement, that such party is
not relying in acquiring such property on any oral or written
statement made by the other party except as provided herein, and
that such party will rely on its own independent inspections of
such property. It is understood that the MPS Property and the
DPL Property will be conveyed in an "as is" condition, and no
warranties or representations have been or will be made by or on
behalf of the conveying party concerning the property or title
thereto other than as provided in Section 1.6(b) hereof.
(ii) Each party is a corporation duly formed and existing under
the laws of its state of incorporation. Each party has full
legal right, power and authority to execute and fully perform
its obligations under Article I of this Agreement, without the
need for any further action.
(b) MPS, as the conveyer of the MPS Property, and DPL, as the conveyer
of the DPL Property, hereby represent, warrant and covenant as
follows:
(i) Each party is a corporation duly formed and existing under
the laws of its state of incorporation. Each party has full
legal right, power and authority to execute and fully perform
its obligations under Article I of this Agreement, without the
need for any further action.
(ii) To the best of MPS's knowledge, with respect to the MPS
Property, and of DPL's knowledge, with respect to the DPL
Property, there is no pending or threatened condemnation of such
property, or of any portion thereof.
(iii) No claim, litigation, proceeding, or governmental
investigation is pending or threatened against or relating to
the property to be conveyed by such party under this Agreement,
or affects such party's ability to fulfill all of its
obligations under this Agreement. Each party is not aware of any
basis for any such claim, litigation, other proceeding or
governmental investigation.
EXHIBIT 99.1
(iv) Each party has neither received notice nor has actual
knowledge that any government authority, or any employee or
agent thereof, considers the property to be conveyed by such
party under this Agreement, or the current operation, use or
ownership of the same to violate any ordinances, laws,
regulations or orders of any governmental entity or any agency,
body or subdivision thereof, or that any investigation has been
commenced, or is contemplated, regarding such possible
violation.
(v) No third party holds any option to purchase, right of first
refusal or right to purchase the property to be conveyed by such
party under this Agreement or any portion thereof. After the
date of this Agreement, each party will not create any such
liens, encumbrances, covenants, leases, licenses, occupancy
agreements, options, rights or other exceptions to title to the
property to be conveyed by such party under this Agreement
without the acquiring party's prior written consent.
(vi) Except for fixed assets specifically excluded on Schedule
1.1A (with respect to the MPS Property) and on Schedule 1.1B
(with respect to the DPL Property), each such property is being
conveyed with all fixed assets located at such property. As set
forth under Section 1.1, each party will keep their own rolling
stock and, as to be agreed upon by the parties, certain portable
assets (such as furniture, computers, supplies, etc.) and will
remove such items from their respective facilities on or before
the Property Closing Date.
(vii) Except as set forth on Schedule 1.4, there are no leases
or management, maintenance, security or other agreements
(whether oral or written) affecting the property to be conveyed
by such party under this Agreement, and no person has any right
of possession to such property or any part thereof.
(viii) The Exchange will not violate any contract, agreement or
instrument to which MPS (with respect to the MPS Property) or
DPL (with respect to the DPL Property) is a party which affects
such property or any part thereof.
1.7 ENVIRONMENTAL ASSESSMENTS.
(a) As promptly as possible after the date of this Agreement, the
parties will have a Phase 1 environmental site assessment conducted
with respect to the MPS Property located at 6201 Southeast Loop #289,
Lubbock, Texas, the MPS Property located at 624 27th Street, Lubbock,
Texas and the DPL Property located at 3600 North Columbia Street,
Plainview, Texas. If the results of such Phase 1 assessments require
a Phase 2 environmental site assessment with respect to any of such
properties in order to adequately assess potential environmental
liabilities, a Phase 2 assessment will be conducted on any such
properties.
(b) The environmental site assessments will be conducted by an
environmental firm selected by DPL. The costs of all assessments
conducted under this Agreement will be shared 50/50 by DPL and MPS.
(c) Based on the environmental assessments of the above-referenced DPL
Property and MPS Property, each selling party prior to the Property
Closing Date (and as a condition precedent to consummating the
Exchange) will remedy any environmental contamination not acceptable
to the acquiring party to the reasonable satisfaction of the
acquiring party. The Property Closing Date may be extended to permit
sufficient time to remedy any such environmental contamination. In
the event that the cost of any such remediation is unacceptably high
to the selling party, such remediation will not be required and such
contaminated property will not be included in the Exchange. In such
event, the parties will negotiate (as a condition precedent to
consummating the Exchange) mutually acceptable compensation for the
party who will not receive all of the property contemplated by this
Agreement to be received by such party in the Exchange. Each
conveying party will
EXHIBIT 99.1
indemnify and hold harmless the acquiring party from and against any
and all liabilities, costs and expenses incurred by the acquiring
party with respect to disposal of hazardous wastes on, or any
violation prior to the Property Closing Date of environmental laws
at, any property actually conveyed to the acquiring party as part of
the Exchange. Each party may elect to have a third-party designee
receive title and ownership of the property being acquired.
ARTICLE II
PURCHASE AND SALE OF DPL'S CORN AND SORGHUM BUSINESS
2.1 CONVEYANCE OF ASSETS.
(a) Effective as of the date of this Agreement, DPL hereby conveys,
assigns and transfers to MPS, and MPS hereby accepts such conveyance,
assignment and transfer of all of DPL's right, title and interest in
and to the following DPL assets related to DPL's corn and sorghum
business:
(i) All corn and sorghum foundation and parent seed germplasm
(including, without limitation, all records and experimental
seed stock related thereto); provided, however, that DPL will
retain title to all existing corn and sorghum seed available for
customer sales.
(ii) Subject to obtaining any legally required consent of third
parties to such written agreements, all written agreements
(including, without limitation, any and all licenses to corn and
sorghum parent lines and varieties licensed by DPL from third
parties) associated with DPL's corn and sorghum business.
(b) DPL represents and warrants that all written agreements associated
with DPL's corn and sorghum business are set forth on Schedule 2.1 to
this Agreement. Also, each agreement requiring such third-party
consent is indicated on Schedule 2.1. Upon request by MPS, DPL will
use diligent efforts to obtain as promptly as practical any and all
third-party consents to assign to MPS the agreements set forth on
Schedule 2.1, including, without limitation, the sorghum conditioning
agreement with Asgrow, but specifically excluding the agreement
relating to the supply and distribution of corn with Ciba Seeds. MPS
will be solely responsible for conducting discussions with Ciba Seeds
regarding any assignment and assumption of such agreement.
(c) MPS hereby assumes all liabilities and responsibilities of DPL as
of the date of this Agreement under all contracts and agreements
assigned or sublicensed to MPS under this Section 2.1, which, in the
case of agreements that require third-party consent, will be deemed
assigned to and assumed by MPS upon receipt of such third-party
consent. To the extent that any such agreements prohibit an
assignment of such agreement, but permit the sublicense of rights
thereunder by DPL, DPL hereby exclusively sublicenses to MPS all of
DPL's right, title and interest under any such agreement. MPS agrees
to continue to supply Ciba Seeds with sorghum seed as historically
supplied by DPL and to enter into a supply agreement mutually
acceptable to MPS and Ciba Seeds for such purpose.
(d) Subject to obtaining the consent of Ciba-Geigy Corporation
substantially in the form attached to this Agreement, DPL represents
and warrants that (i) it has full power and authority to assign to
MPS its ownership and irrevocable license to all sorghum germplasm
owned or licensed by DPL without the need for any third party consent
or approval; (ii) effective as of the date of this Agreement, all of
DPL's right, title and interest in DPL's parent and foundation
sorghum germplasm hereby is conveyed, assigned and transferred to
MPS; and (iii) MPS has all the rights of DPL under DPL's sorghum
germplasm license (as set forth in the excerpts to the Assets
Purchase Agreement dated December 13, 1988 between DPL and Ciba Geigy
attached as part of Schedule 2.1) subject only to the
EXHIBIT 99.1
limitations to such license as set forth under the license grant
provisions of such license agreement. This representation and
warranty will survive the consummation of the transactions
contemplated by this Agreement.
2.2 SALE OF EXISTING DPL CORN AND SORGHUM INVENTORY.
(a) DPL will retain title to all existing DPL corn and sorghum
inventory until title is transferred to MPS in accordance with
Section 2.2.(a)(iv) for sale to MPS customers. MPS and DPL hereby
agree that DPL's existing corn and sorghum available seed (including
fiscal 1995 production to come into inventory) will be marketed and
sold during the 1995 through 1997 marketing years (through December
1997) as follows:
(i) DPL, in 1995, and MPS, in 1996 and 1997, will use diligent
efforts to market and sell DPL available corn and sorghum seed
on a FIFO basis to the extent commercial quality standards can
be satisfied. Such quality standards are set forth on Schedule
2.2A by corn and sorghum hybrid. The quantity of corn and
sorghum seed comprising DPL's available seed is set forth by
hybrid, pedigree (to the extent DPL has pedigree information
readily available) and, with respect to corn, by seed size on
Schedule 2.2B.
(ii) DPL will be responsible for marketing and selling the DPL
available corn and sorghum seed for the benefit and account of
MPS in 1995. DPL also will be responsible for shipments,
invoicings and collections in 1995. With respect to all order
entry, bagging and rebagging, shipments, invoicing and
collections for 1995, DPL will send out all documentation to
customers under its computer system and provide such information
to MPS. Each invoice will indicate that the sale is made for the
benefit of MPS. DPL will be responsible for cash collections
with respect to 1995 sales. MPS will be responsible for bad
debts with respect to 1995 sales consummated after the date of
this Agreement; provided, however, that Mycogen will be able to
offset the amount of such bad debts against any repurchase of
Mycogen stock from DPL under Section 3.5.
(iii) MPS will be responsible for marketing and selling the DPL
available corn and sorghum seed in 1996 and 1997. MPS will also
be responsible for order entry, bagging and rebagging,
shipments, invoicing, and collections with respect to sales
after 1995. In connection with marketing and selling DPL
available corn seed, MPS will, in each of 1996 and 1997, sell
(as a percentage of sales) a quantity of "small" or
"undesirable" seed sizes of corn fitting the description of
"small" or "undesirable" seed set forth on Schedule 2.2C equal
to DPL's average annual quantity of small corn seed sizes sold
by DPL (as a percentage of sales) over the last three years,
which average annual quantity (as a percentage of sales) also is
set forth on Schedule 2.2C. In each of 1996 and 1997, MPS will
not sell any "small" or "undesirable" seed produced by MPS after
the date of this Agreement until the annual average quantity (as
a percentage of sales) of "small" or "undesirable" seed set
forth on Schedule 2.2C has been sold in such year out of the DPL
available seed. In the event that MPS fails to sell the annual
average quantity of "small" or "undesirable" seed (as a
percentage of sales) set forth on Schedule 2.2C in each of 1996
and 1997, MPS will purchase any shortfall (the difference
between the quantity of "small" or "undesirable" seed actually
sold, as a percentage of sales, and the annual average quantity,
as a percentage of sales, set forth on Schedule 2.2C) out of DPL
available seed on or before August 15 of each of 1996 and 1997.
(iv) All sales of the DPL available corn and sorghum seed will
be made for the account of MPS. Immediately prior to shipping
seed to fill each customer order, the amount of seed required to
fill such order automatically will be deemed to be assigned,
conveyed and transferred to MPS at a transfer price equal to
DPL's cost of such seed, less reserve for returns of 40% for
sorghum and 35% for corn, for
EXHIBIT 99.1
delivery on behalf of MPS to such customer. MPS and DPL hereby
agree that for all purposes under this Section 2.2, DPL's costs
of its available corn and sorghum seed for 1995, 1996 and 1997
is set forth on Schedule 2.2D. Within five business days after
each calendar quarter ending March and June of 1995, 1996 and
1997 and on August 15 of each of 1995, 1996 and 1997, MPS will
pay DPL for all DPL available seed shipped to customers during
such calendar quarter and during the period of July 1 to August
15 of each such year.
(v) With respect to all sales of the DPL available corn and
sorghum seed, DPL will receive (1) 85% of total gross margins on
all sales in 1995, (2) 50% of total gross margins on all sales
in 1996, and (3) 30% of total gross margins on all sales in
1997. MPS will retain the balance of such gross margins. The
costs (calculated on a basis consistent with prior periods) and
the projected domestic selling prices of DPL sorghum and corn
seed are set forth on Schedule 2.2D. Gross margin will be
calculated based on total sales less cost of goods sold (as set
forth on Schedule 2.2D), third-party commissions, discounts and
rebates actually allowed. Payment of gross margin to reflect the
sharing arrangement described above, together with an adjusting
payment to reflect any difference between actual returns and
reserve for returns, will be made between DPL and MPS on August
15 of each of 1995, 1996 and 1997. All customer returns of seed
from DPL's existing corn and sorghum inventory will be returned
to, and owned entirely by, DPL.
(vi) At the end of 1997, DPL will be responsible for the
disposal of any remaining DPL available corn and sorghum seed
not sold by MPS in accordance with this Section 2.2 as of
December 31, 1997. DPL will not sell such remaining seed in the
United States as planting seed. DPL will market and sell any
such remaining seed in the international retail or wholesale
market or as grain (and not as planting seed) in the U.S.
wholesale market. On or before March 30, 1998, DPL will remove,
at its cost, all remaining DPL available seed located in MPS
warehouses as of the end of 1997.
(vii) DPL will continue, at DPL's cost, its Special DPL
Salesman Incentive Program for current employee-salespersons for
1995 for sales of corn and sorghum. The cost of DPL's incentive
program for 1995 will not be included in the calculation of
gross margin in connection with the sharing of gross margins
between DPL and MPS as set forth above.
(viii) Any new production of corn and sorghum or new corn and
sorghum hybrids (i.e., any sale of corn or sorghum other than
out of DPL's existing inventory) will be owned and sold by MPS
entirely for MPS's account. Sales by MPS of any new production
of corn and sorghum will be made by hybrid on a FIFO basis
consistent with Section 2.2(a)(i) so as to market and sell the
DPL available seed (on a hybrid-by-hybrid basis) that satisfies
the quality standards set forth on Schedule 2.2A prior to the
sale of any newly produced seed.
(ix) The DPL available corn and sorghum seed will be marketed
and sold in DPL bags for the 1995 season. MPS will have the
right, but not the obligation, to continue selling such
inventory in DPL bags through 1997; provided, that if such
inventory is sold in DPL bags after 1995, MPS hereby indemnifies
and holds DPL harmless from and against any and all liabilities,
costs and expenses related to any customer claims made against
DPL with respect to such seed sold in DPL bags. In connection
with MPS's right to sell DPL available corn and sorghum seed in
1996 and 1997 in DPL bags, DPL grants MPS a license,
specifically limited to such sales, to use DPL's trademarks that
are on DPL's sorghum and corn seed bags. DPL will have the right
to inspect any DPL available seed bagged in DPL bags to insure
that the seed in such bags satisfies the quality standards set
forth on Schedule 2.2A and that the appearance of the filled
bags are suitable for customer delivery and are not
EXHIBIT 99.1
tattered or torn. DPL reserves the right to revoke the rights
granted to MPS under this Section 2.2(a)(ix) if seed sold in
such bags does not satisfy the quality standards set forth on
Schedule 2.2A or if filled bags for customer delivery are
tattered and torn so as not to be suitable for delivery. Upon
reasonable advance notice from MPS, DPL will supply MPS on a
timely basis with DPL bags for the purpose of selling DPL's
existing corn and sorghum inventory in accordance with this
Section 2.2(a)(ix). MPS will purchase such bags at prices equal
to DPL's cost to produce the bags.
(x) MPS agrees that it will not market and sell the DPL
available corn and sorghum seed at prices greater than DPL's
suggested retail selling price by hybrid as set forth on
Schedule 2.2D plus a year-to-year annual five percent increase
thereon in each of 1996 and 1997.
(b) DPL and MPS agree that casualty and risk of loss of the DPL
available corn and sorghum seed (including any and all customer
returns) will remain with DPL until such time as seed is shipped to
customer or unless such casualty or loss is caused by the negligence
of MPS.
2.3 DPL NON-COMPETE IN CORN AND SORGHUM UNTIL THE YEAR 2000. From the date
of this Agreement until January 1, 2000, DPL will not engage in the
development, marketing or sale of corn or sorghum hybrids in the regions of
the United States where DPL currently markets and sells corn and sorghum;
provided, however, that this Section 2.3 automatically will terminate
earlier than January 1, 2000 in the event (and effective upon the
occurrence) that prior to such time a seed company engaged in the business
of producing and selling corn and sorghum acquires a majority of the
outstanding shares of capital stock of DPL or substantially all of the
assets of DPL.
ARTICLE III
ISSUANCE OF MYCOGEN STOCK TO DPL
3.1 ISSUANCE OF MYCOGEN STOCK. On the date of this Agreement, Mycogen will
issue 153,846 shares of Mycogen common stock as part of the consideration
for the transactions under this Agreement.
3.2 REGISTRATION OF MYCOGEN SHARES. As promptly as practicable, and within
30 days of the date of this Agreement, Mycogen will file a registration
statement on Form S-3 with the Securities and Exchange Commission to permit
DPL to sell the Mycogen shares delivered under this Agreement under such
registration statement. Mycogen will maintain such registration statement
in full force and effect until the earlier to occur of (i) the sales of all
such shares by DPL (whether by repurchase of such shares by Mycogen under
Section 3.5 below or otherwise) or (ii) three years after the date of this
Agreement so as to enable DPL to sell the Mycogen shares in the public
market from the date of this Agreement until three years after the date of
this Agreement.
3.3 REGISTRATION EXPENSES. Mycogen will pay all out-of-pocket expenses
related to the registration of the shares of Mycogen common stock delivered
to DPL under this Agreement, including, without limitation, NASD
registration and filing fees, all fees and expenses incurred in complying
with securities or blue sky laws, all printing, messenger and delivery
expenses, the fees and disbursements of counsel to Mycogen and of its
independent public accountants, and all registration, filing and
qualification fees of the Securities and Exchange Commission and state
securities or blue sky commissions.
3.4 INDEMNIFICATION BY MYCOGEN. Mycogen will indemnify, to the fullest
extent permitted by law, DPL and its officers, directors and employees and
each person who controls DPL (within the
EXHIBIT 99.1
meaning of the Securities Act of 1933, as amended, or the Security Exchange
Act of 1934, as amended) from and against any losses, claims, damages,
liabilities and expenses (including reasonable attorneys' fees) arising out
of or based upon any untrue, or alleged untrue, statement of a material
fact contained, or incorporated by reference, in the Form S-3 registration
statement referred to above as originally filed and subsequently amended
covering any sale or distribution by DPL of the shares of Mycogen common
stock issued to DPL under this Agreement, or arising out of or based upon
any omission or alleged omission to state a material fact required to be
stated therein or necessary to make the statements therein not misleading,
except insofar as the same are caused by, or contained in, any information
furnished in writing to Mycogen by DPL expressly for use in such
registration statement.
3.5 MYCOGEN PURCHASE OPTION. DPL hereby grants to Mycogen an option
exercisable at any time after January 1, 1996 and ending on December 31,
1997 to purchase from DPL 153,846 shares of Mycogen common stock for a cash
payment of $1.35 million minus the amount, if any, of bad debts incurred by
MPS from sales out of DPL inventory in 1995 pursuant to Section 2.2(a)(ii).
ARTICLE IV
MISCELLANEOUS
4.1 FORCE MAJEURE. "Force Majeure" will mean any event that is beyond the
control of the parties, that is unforeseen, unavoidable or insurmountable,
that arises after the execution of this Agreement and that prevents total
or partial performance by one or more of the parties. Such events will
include, without limitation, government regulations, war, strike, act of
God, or other similar circumstances. If an event of Force Majeure occurs, a
party's contractual obligations affected by such event will be suspended
during the period of delay caused by the Force Majeure. A party claiming
Force Majeure will promptly inform the other party in writing of the
occurrence and the expected duration of such Force Majeure. The party
claiming Force Majeure will use reasonable efforts to terminate the Force
Majeure. In the event of Force Majeure, each party will remain obligated to
perform all obligations that it is able to perform, the Force Majeure
notwithstanding. The parties will immediately consult with each other in
order to find an equitable solution and will use reasonable efforts to
minimize the consequences of such Force Majeure, including amendments to
this Agreement that are valid and legal and, to the maximum extent
possible, carry out the original intent of the parties.
4.2 RESTRICTION ON ASSIGNMENT. Neither Mycogen, MPS nor DPL may assign its
rights or obligations under this Agreement to any third party without the
prior written consent of the other party; provided, however, that this
restriction on assignment will not apply to an assignment to any entity
that succeeds to the either party's position by merger, consolidation, or
other corporate reorganization.
4.3 GOVERNING LAW; ENTIRE AGREEMENT. This Agreement will be governed by
the laws of the State of Delaware, without the application of any choice of
law statutes or regulations. This Agreement and the attached Schedules
contain the entire agreement among the parties with respect to the purchase
and sale of DPL's corn and sorghum business and the exchange of MPS and DPL
facilities as contemplated hereunder, and supersedes all prior arrangements
or understandings with respect thereto, whether written or oral. No
modification or waiver of any provision of this Agreement will be effective
unless made in writing and signed by all parties to this Agreement. The
terms and conditions of this Agreement will inure to the benefit of and be
binding upon the parties and their respective successors and permitted
assigns.
EXHIBIT 99.1
4.4 ADDITIONAL DOCUMENTS. The parties hereby agree to execute and deliver
any additional instruments or documents, in form and substance mutually
acceptable to the parties, to effect or evidence the transactions
contemplated by this Agreement.
4.5 COUNTERPARTS. This Agreement may be executed in two or more
counterparts, which, taken together, will constitute one and the same
instrument.
4.6 PUBLIC ANNOUNCEMENT. Except for documents that are required to be
flied with a government agency under applicable laws and regulations,
neither party will make any press release, public announcement or public
confirmation concerning the terms of this Agreement without prior written
approval of the other party; provided, however, that once public disclosure
is made in accordance with this Section 4.6, each party can make subsequent
public disclosures consistent with such prior public disclosure without
obtaining the prior approval of the other party.
4.7 MYCOGEN GUARANTY. By executing and delivering this Agreement, Mycogen
guarantees the performance by MPS of all of MPS's obligations to DPL under
this Agreement.
IN WITNESS WHEREOF, the parties have caused this Agreement to be effective as of
the date first above written.
MYCOGEN CORPORATION DELTA AND PINE LAND COMPANY
By: /s/ J.R. Glynn By: /s/ Murray Robinson
-------------------------------- ----------------------------------
Title: Executive Vice President Title: President
----------------------------- -------------------------------
AGRIGENETICS, INC. d/b/a
Mycogen Plant Sciences
By: /s/ Carlton J. Eibl
--------------------------------
Title: Vice President
-----------------------------
EXHIBIT 99.1
SCHEDULES TO PURCHASE AGREEMENT
Schedule 1.1A MPS Excluded Fixed Assets
Schedule 1.1B DPL Excluded Fixed Assets
Schedule 1.4 Leases, Property Maintenance, Management and Security
Contracts (if any)
Schedule 2.1 DPL Agreements and Germplasm Licenses Related to Corn and
Sorghum Business
Schedule 2.2A Seed Quality Standards
Schedule 2.2B Quantity of DPL Inventory (Detailed)
Schedule 2.2C Definition and Annual Sales of Small or Undesirable Seed
Sizes
Schedule 2.2D Projected Selling Price and Cost of DPL Corn and Sorghum
Product Line
EXHIBIT 99.1
Purchase Agreement Schedules
- --------------------------------------------------------------------------------
Schedule 1.1A
MPS Excluded Fixed Assets and Rolling Stock - Attached
Schedule 1.1B
DPL Excluded Fixed Assets and Rolling Stock - Still Pending
Note: Both parties have verbally agreed that portable equipment, such as
trucks, computers, etc., will remain with the current owners. Other fixed assets
which will be exchanged as part of this agreement will be determined by Randy
Dismuke of DPL and Larry Price of MPS after the transaction is announced.
EXHIBIT 99.1
Purchase Agreement Schedules
- -----------------------------------------------------------------------------
Schedule 1.4
MPS leases, Property Maintenance, Management and Security Contracts (if
any):
None
DPL Leases, Property Maintenance, Management and Security Contracts (if
any):
National Guardian Alarm service agreement attached.
EXHIBIT 99.1
Purchase Agreement Schedules
- ------------------------------------------------------------------------------
SCHEDULE 2.1
DPL AGREEMENTS AND GERMPLASM LICENSES RELATED TO CORN AND SORGHUM BUSINESS
ITEM DESCRIPTION EXPIRATION ASSIGNABLE?
- --------------------------------------------------------------------------------
1. Sorghum Purchase Agreement
(Buyer: DPL; Seller: Ciba (Funk)
2. Asgrow Conditioning Agreement 6/30/95 Silent
3. Weaver Popcorn Storage Agreement 8/31/95 Yes; see p.
4, #13
4. Carter Processing Storage 3/23/95
Agreement
5. Northrup King Storage Agreement 6/1/95 Silent
6. D&PL General Distributor Policy Silent
(list of distributors to be
provided at closing)
7. Ciba Corn Distributorship 1 Yr. Notice Only with
Agreement 2 Yr. Sales consent (p. 22)
EXHIBIT 99.1
Purchase Agreement Schedules
- --------------------------------------------------------------------------------
Schedule 2.2A
Seed Quality Standards
Attached are MPS quality standards for corn and sorghum. These standards
will apply to DPL FIFO inventory, except that acceptable warm and cold test
standards for corn will be as follows:
Warm Test: 92%
Cold Test: 80%
EXHIBIT 99.1
Purchase Agreement Schedules
- --------------------------------------------------------------------------------
SCHEDULE 2.2B
D&PL AVAILABLE SEED
EXHIBIT 99.1
Purchase Agreement Schedules
- --------------------------------------------------------------------------------
Schedule 2.2C
Definition and Annual Sales of Small or Undesirable Seed Sizes
Definition of Undesirable Seed Sizes:
Small Flat F16 or Smaller
Small Round R25 or Smaller
Large Flat F12 or Larger
Large Round R22 or Larger
Plateless PP1 or PP2
Summary showing inventory and 3-year average attached, with
supporting detail.
EXHIBIT 99.1
SCHEDULE 2.2C
SMALL/UNDESIRABLE SEED SIZE
The plate sizes below are defined as "small" or "undesirable".
THREE-YEAR AVERAGE
ANNUAL SALES
PLATE SIZE/1/ (as a percentage of
average total annual
sales)/2/
---------------------------------------------------------------------------
Small Flat B9 or smaller
B190
-----------------------------------------------
Small Round B3 (see attached
B30 material)
B25
-----------------------------------------------
Large Flat B5 or larger
B8
-----------------------------------------------
Large Round B0
B54
_____________________________
/1/ The stated plate standard or comparable standard of any other plate
size manufacturer.
/2/ Based on average annual sales by DPL during 1992, 1993 and 1994 of
corn seed by hybrid of the referenced small or undesirable size.
EXHIBIT 99.1
Purchase Agreement Schedules
- --------------------------------------------------------------------------------
SCHEDULE 2.2D
PROJECTED SELLING PRICE AND COST
OF DPL CORN AND SORGHUM
PRODUCT LINE
PROJECTED NET 1995
DOMESTIC 1995 COST/1,3/ 1996/1997 SUGGESTED
SELLING PRICE COST/2,3/ RETAIL PRICES
==========================================================================================
Corn $49.25 $39.94 $34.24 See the
- -------------------------------------------------------------------------
Grain Sorghum 33.73 21.99 14.33 attached
- -------------------------------------------------------------------------
Sudan Sorghum 10.40 7.54 7.10 1995 price
- -------------------------------------------------------------------------
Forage Sorghum 27.11 21.96 21.79 list.
- -------------------------------------------------------------------------
Sweet G90Corn 71.30 51.10 48.47
_____________________________
/1/ Includes budgeted inventory cost, reprocessing cost and certain write
off cost. Only adjustments will include cost of current year conditioning
and bagging. Actual cost will not vary by more than 5% from stated cost.
/2/ Includes inventory cost and will be adjusted only for the cost of
additional seed added to inventory from 1995 seed production. No obsolete
seed or other write off of inventory will impact this cost. Actual cost will
not vary by more than 5% from stated cost.
/3/ Costs exclude the cost of warehousing inventory.
EXHIBIT 99.1