Historical Context and Original Agreements
The board of directors of 3M India Limited had previously approved on November 10, 2023, the execution of a binding term sheet with several 3M Healthcare entities (later renamed Solventum entities) for licensed manufacturing, reselling, distributorship, and sales agent agreements related to the company's healthcare business.
On March 31, 2024, the company executed the following agreements (collectively "Transaction Agreements"):
- Distribution Agreement with 3M Healthcare US Opco, LLC and 3M Healthcare LATAM/APAC Export Corporation
- Licensed Manufacturer and Reseller Agreement (LMRA) with Solventum Intellectual Properties Company, 3M Healthcare US Opco, LLC, and 3M Healthcare LATAM/APAC Export Corporation
- Sales Agent Agreement with 3M Unitek Corporation
All agreements came into effect on March 31, 2024. Counterparty name changes occurred: 3M Healthcare US Opco, LLC became Solventum US LLC, and 3M Healthcare Intellectual Properties Company became Solventum Intellectual Properties Company.
Key Terms of Original Agreements (from November 2023 disclosure)
- Initial Term: 5 years for Licensed Manufacturer and Reseller Agreement and Distribution Agreement; 1 year for Sales Agent Agreement
- Financial Terms:
- Royalty payment of 4% of net sales value to 3M Healthcare Intellectual Properties Company (US)
- Commission of 12% of annual sales for 3M Unitek Corporation's products sold in India
- Purchase of raw materials and specified healthcare products at agreed prices with yearly adjustment
- Business Scope:
- Exclusive distributor of medical solutions, oral care solutions, and separation/purification sciences divisions in India and Nepal
- Exclusive license to manufacture and sell specified healthcare products in the territory
- Commission/sales agent for 3M Unitek Corporation's oral care products in India
- Significant Conditions: Exclusivity in territory, automatic renewal after initial term, option for counterparties to acquire company's healthcare business
Amendment Details (Current Disclosure)
On October 26, 2026, the board of directors reviewed and approved key commercial terms for amending the Transaction Documents through a "2nd Amendment Agreement."
The proposed amendments include:
1. Removal of certain products (TF Divested Products) from the scope of the Distribution Agreement following Solventum's divestiture of the corresponding product portfolio to Thermo Fisher
2. Extension of the Distribution Agreement term for continuing products by an additional 2 years, making the total term 7 years from the original execution date (March 31, 2024)
Key Terms of 2nd Amendment Agreement
- TF Divested Products: Products listed in Exhibit A of the 2nd Amendment Agreement that will be removed from the Distribution Agreement scope
- Termination Conditions: Removal effective only upon satisfaction of certain conditions agreed among parties; if conditions not satisfied, TF Divested Products remain subject to Distribution Agreement
- Compensation: Company to receive one-time compensation of US$13 million from Thermo Fisher Scientific Inc. (or its affiliate) for termination of rights and transfer of eligible unsold inventory
- Future Divestiture Compensation:
- For divestitures completed on/before March 31, 2029: 100% of net sales of divested products during preceding 12 months
- For divestitures completed after March 31, 2029 but on/before March 31, 2031: 60% of net sales of divested products during preceding 12 months
- No compensation for divestitures after March 31, 2031
- Transition: Parties will enter into tripartite agreement with Thermo Fisher to record transition terms for TF Divested Products
Governance and Approval
The board of directors authorized the execution of the relevant 2nd Amendment Agreement and subsequent amendment to LMRA (to be executed within 30 calendar days from 2nd Amendment Agreement execution).