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<PAGE>
==============================================================
Chemicals Monsanto Tomorrow
July 16, 1997
Vol. 1 No. 22
==============================================================
Monsanto Releases Proxy Statement for Spinoff of Chemicals
Businesses
==============================================================
This week Monsanto released the proxy statement for the spinoff of
the Chemicals businesses. The proxy explains the issues to be
voted on by shareowners at a special meeting on Aug. 18, 1997, at
10:00 a.m. in St. Louis. It also provides additional information
about the makeup of the proposed Life Sciences and Chemicals
companies.
The following highlights may be of special interest to employees:
- After the spinoff, benefits, pension and savings and invest-
ment plans will remain virtually unchanged for employees of
both companies. Chemicals will assume primary responsibil-
ity for the benefits, pension and savings and investment
plans for its employees. The proxy notes that a jointly
sponsored multiple-employer pension plan may be created in
the United States, pending approval from the Pension Benefit
Guarantee Corporation (PBGC). Of course, the benefit plans
of both companies may change in the future to respond to
economic or industry conditions or regulatory requirements.
- Decisions on the handling of stock options are still pend-
ing, but more information will be communicated as soon as it
is available.
- Monsanto has applied for a ruling from the U.S. Internal
Revenue Service that the spinoff will generally be tax free
to shareowners in the United States. If shareowners approve
the spinoff and charter amendments, the tax-free ruling is
received, and the other conditions to the spinoff occur,
each shareowner will receive one share of common stock in
the new chemical company for every five shares of Monsanto
common stock owned on the record date of the spinoff.
- Both Chemicals and Life Sciences are evaluating what their
dividend policies will be after the spinoff. No final deci-
sions have been made, but the combined dividends of the two
companies are likely to be less than Monsanto's current
quarterly dividend of 64 cents per share. Chemicals may
Page 2<PAGE>
decide to return earnings to shareowners through cash divi-
dends and/or stock repurchases, and Life Sciences is consid-
ering its dividend policy in light of its future growth
plans.
- Upon completion of the spinoff, Chemicals will receive the
food phosphates business and the Flexsys L.P. and Advanced
Elastomer Systems L.P. joint ventures. Enviro-Chem and the
industrial alginates businesses, formerly reported as
Chemicals operations, will remain with Life Sciences. As
part of this allocation, Chemicals also will receive $75
million in cash from Life Sciences.
- Monsanto will issue commercial paper to raise $1 billion in
new capital, which will be used by Monsanto to repay exist-
ing debt. Chemicals will assume the remaining liabilities
of sold or discontinued businesses historically associated
with Monsanto's chemical units, certain environmental li-
abilities of sold or discontinued businesses, the liabili-
ties associated with the $1 billion mentioned above,
$30,000,000 in liabilities from the allocation of some ESOP
(Employee Stock Ownership Program) debt, and additional
liabilities for pensions and other post-retirement benefits.
The Chemicals businesses have always generated considerable
cash from operations, and that fact, coupled with the $75
million from Life Sciences, as well as periodic additional
borrowings, should allow it sufficient resources to finance
operations and capital needs. This allocation of debt
creates the greatest value for shareowners from the spinoff,
while enabling Chemicals to attain an investment-grade
credit rating.
- A proposed amendment to the Monsanto Company Charter would
provide for staggered three-year terms for the board of
directors. If the amendment is passed, the following board
members will stand for election to the Monsanto board, for
initial terms of one to three years:
Robert B. Shapiro
Robert M. Heyssel
Michael Kantor
Gwendolyn S. King
Philip Leder
Jacobus F.M. Peters
Nicholas L. Reding*
John S. Reed
John E. Robson*
Page 3<PAGE>
William D. Ruckelshaus*
* Continuing existing terms expiring in 1998
Prior to the spinoff, Monsanto will be sole shareowner in the
Chemicals Company, and plans to elect these members to the
Chemicals board of directors:
Robert G. Potter
John C. Hunter III
Robert T. Blakely
Joan T. Bok
Paul H. Hatfield
Howard M. Love
Frank A. Metz, Jr.
William D. Ruckelshaus
John B. Slaughter
The names for Life Sciences and Chemicals will be announced
closer to the actual spinoff date. Both parts of the business
will disclose their identity plans at a later date. If
shareowners approve the spinoff and charter amendments, the
company anticipates completing the spinoff on or before Oct. 1,
1997.
Full text of the proxy is available on Monsanto's World Wide
Web site at http://www.monsanto.com under the Financial section
(Related Materials).
-o0o-
Page 4<PAGE>
==============================================================
Monsanto Tomorrow
Life Sciences Edition
July 15, 1997
Vol. 1 No. 11
==============================================================
Monsanto Releases Proxy Statement for Spinoff of Chemicals
Businesses
==============================================================
This week Monsanto released the proxy statement for the spinoff of
the Chemicals businesses. The proxy explains the issues to be
voted on by shareowners at a special meeting on Aug. 18, 1997, at
10:00 a.m. in St. Louis. It also provides additional information
about the makeup of the proposed Life Sciences and Chemicals
companies.
The following highlights may be of special interest to employees:
- After the spinoff, benefits, pension and savings and invest-
ment plans will remain virtually unchanged for employees of
both companies. Chemicals will assume primary responsibil-
ity for the benefits, pension and savings and investment
plans for its employees. The proxy notes that a jointly
sponsored multiple-employer pension plan may be created in
the United States, pending approval from the Pension Benefit
Guarantee Corporation (PBGC). Of course, the benefit plans
of both companies may change in the future to respond to
economic or industry conditions or regulatory requirements.
- Decisions on the handling of stock options are still pend-
ing, but more information will be communicated as soon as it
is available.
- Monsanto has applied for a ruling from the U.S. Internal
Revenue Service that the spinoff will generally be tax free
to shareowners in the United States. If shareowners approve
the spinoff and charter amendments, the tax-free ruling is
received, and the other conditions to the spinoff occur,
each shareowner will receive one share of common stock in
the new chemical company for every five shares of Monsanto
common stock owned on the record date of the spinoff.
- Both Chemicals and Life Sciences are evaluating what their
dividend policies will be after the spinoff. No final deci-
sions have been made, but the combined dividends of the two
companies are likely to be less than Monsanto's current
quarterly dividend of 64 cents per share. Chemicals may
Page 5<PAGE>
decide to return earnings to shareowners through cash divi-
dends and/or stock repurchases, and Life Sciences is consid-
ering its dividend policy in light of its future growth
plans.
- Upon completion of the spinoff, Chemicals will receive the
food phosphates business and the Flexsys L.P. and Advanced
Elastomer Systems L.P. joint ventures. Enviro-Chem and the
industrial alginates businesses, formerly reported as
Chemicals operations, will remain with Life Sciences. As
part of this allocation, Chemicals also will receive $75
million in cash from Life Sciences.
- Monsanto will issue commercial paper to raise $1 billion in
new capital, which will be used by Monsanto to repay exist-
ing debt. Chemicals will assume the remaining liabilities
of sold or discontinued businesses historically associated
with Monsanto's chemical units, certain environmental li-
abilities of sold or discontinued businesses, the liabili-
ties associated with the $1 billion mentioned above,
$30,000,000 in liabilities from the allocation of some ESOP
(Employee Stock Ownership Program) debt, and additional
liabilities for pensions and other post-retirement benefits.
The Chemicals businesses have always generated considerable
cash from operations, and that fact, coupled with the $75
million from Life Sciences, as well as periodic additional
borrowings, should allow it sufficient resources to finance
operations and capital needs. This allocation of debt
creates the greatest value for shareowners from the spinoff,
while enabling Chemicals to attain an investment-grade
credit rating.
- A proposed amendment to the Monsanto Company Charter would
provide for staggered three-year terms for the board of
directors. If the amendment is passed, the following board
members will stand for election to the Monsanto board, for
initial terms of one to three years:
Robert B. Shapiro
Robert M. Heyssel
Michael Kantor
Gwendolyn S. King
Philip Leder
Jacobus F.M. Peters
Nicholas L. Reding*
John S. Reed
John E. Robson*
Page 6<PAGE>
William D. Ruckelshaus*
* Continuing existing terms expiring in 1998
Prior to the spinoff, Monsanto will be sole shareowner in the
Chemicals Company, and plans to elect these members to the
Chemicals board of directors:
Robert G. Potter
John C. Hunter III
Robert T. Blakely
Joan T. Bok
Paul H. Hatfield
Howard M. Love
Frank A. Metz, Jr.
William D. Ruckelshaus
John B. Slaughter
The names for Life Sciences and Chemicals will be announced
closer to the actual spinoff date. Both parts of the business
will disclose their identity plans at a later date. If
shareowners approve the spinoff and charter amendments, the
company anticipates completing the spinoff on or before Oct. 1,
1997.
Full text of the proxy is available on Monsanto's World Wide
Web site at http://www.monsanto.com under the Financial section
(Related Materials).
-o0o-
Page 7
