UNITED STATES
                       SECURITIES AND EXCHANGE COMMISSION
                             Washington, D.C. 20549



                                    FORM 10-K



  X        ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
           SECURITIES EXCHANGE ACT OF 1934 (NO FEE REQUIRED)

                    For the fiscal year ended August 31, 1996

                                       OR

           TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
           SECURITIES EXCHANGE ACT OF 1934 (NO FEE REQUIRED)

                        For the transition period from to

                         Commission File Number : 0-7908

                          PIONEER HI-BRED INTERNATIONAL, INC.
                (Exact name of registrant as specified in its charter)

                                      Iowa
         (State or other jurisdiction of incorporation or organization)

                                   42-0470520
                      (I.R.S. Employer Identification No.)

             700 Capital Square, 400 Locust, Des Moines, Iowa 50309
                    (Address of principal executive offices)

                                 (515) 248-4800
              (Registrant's telephone number, including area code)

           Securities registered pursuant to Section 12(b) of the Act:


        Title of each class           Name of each exchange on which registered
  Common Stock ($1.00 par value)                 New York Stock Exchange


<PAGE>



           Securities registered pursuant to Section 12(g) of the Act:

                                 Title of class
                                      NONE

Indicate by check mark whether the registrant (1) has filed all reports required
to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during
the  preceding 12 months (or for such  shorter  period that the  registrant  was
required  to file  such  reports)  and  (2)  has  been  subject  to such  filing
requirements for the past 90 days.

                             Yes      X          No

Indicate by check mark if disclosure of delinquent  filers  pursuant to Item 405
of Regulation  S-K is not contained  herein,  and will not be contained,  to the
best of registrant's  knowledge,  in definitive proxy or information  statements
incorporated by reference in Part III of this Form 10-K or any amendment to this
Form 10-K. [X]

The  aggregate  market  value of  voting  stock  held by  non-affiliates  of the
Registrant  as of October 9, 1996,  was  $5,127,129,984.  As of October 9, 1996,
82,378,119  shares of the  Registrant's  Common  Stock,  $1.00 par  value,  were
outstanding.


<PAGE>


                       DOCUMENTS INCORPORATED BY REFERENCE


1.  Registrant  incorporates  by  reference  portions  of  the  Pioneer  Hi-Bred
    International,  Inc. Annual  Shareholders'  Report for the year ended August
    31, 1996. (Items 1 and 2 of Part I, Items 5, 6, 7 and 8 of Part II.)

2.  Registrant  incorporates  by  reference  portions  of  the  Pioneer  Hi-Bred
    International,  Inc. Proxy  Statement for the annual meeting of shareholders
    on January 28, 1997. (Items 10, 11, 12 and 13 of Part III).

                                     PART I

ITEM   1.  BUSINESS

           The  description  of  business  contained  in the  Annual  Report  to
           Shareholders  for the year  ended  August  31,  1996 is  incorporated
           herein by reference.

ITEM   2.  PROPERTIES

           The  description  of  properties  contained  in the Annual  Report to
           Shareholders  for the year  ended  August  31,  1996 is  incorporated
           herein by reference.

ITEM   3.  LEGAL PROCEEDINGS

           The description of legal  proceedings  contained within footnote 7 in
           the Annual Report to Shareholders  for the year ended August 31, 1996
           is incorporated herein by reference.

ITEM   4.  SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS

           None

                                     PART II

ITEM   5.  MARKET FOR THE REGISTRANT'S COMMON EQUITY AND RELATED STOCKHOLDER
           MATTERS

           Market information for the Registrant's Common Stock contained in the
           Annual Report to  Shareholders  for the year ended August 31, 1996 is
           incorporated herein by reference.

ITEM   6.  SELECTED FINANCIAL DATA

           Selected   financial   data   contained  in  the  Annual   Report  to
           Shareholders  for the year  ended  August  31,  1996 is  incorporated
           herein by reference.


<PAGE>



ITEM   7.  MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
           RESULTS OF OPERATIONS

           Management's  discussion  and  analysis of  financial  condition  and
           results of operations  contained in the Annual Report to Shareholders
           for the  year  ended  August  31,  1996  is  incorporated  herein  by
           reference.

ITEM   8.  CONSOLIDATED FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA

           The  consolidated  financial  statements of the Registrant,  together
           with the report  thereon of KPMG Peat  Marwick LLP  contained  in the
           Annual Report to Shareholders  for the year ended August 31, 1996 are
           incorporated herein by reference.

ITEM   9.  CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND
           FINANCIAL DISCLOSURE

           None

                                    PART III

ITEM  10.  DIRECTORS AND EXECUTIVE OFFICERS OF THE REGISTRANT

           Reference is made to  registrant's  definitive  proxy statement to be
           filed with the Commission pursuant to Regulation 14(a) not later than
           December  10, 1996;  and the  information  responsive  to the item is
           incorporated herein by reference.

ITEM  11.  EXECUTIVE COMPENSATION

           Reference is made to  registrant's  definitive  proxy statement to be
           filed with the Commission pursuant to Regulation 14(a) not later than
           December  10, 1996;  and the  information  responsive  to the item is
           incorporated herein by reference.

ITEM  12.  SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT

           Reference is made to  registrant's  definitive  proxy statement to be
           filed with the Commission pursuant to Regulation 14(a) not later than
           December  10, 1996;  and the  information  responsive  to the item is
           incorporated herein by reference.

ITEM  13.  CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS

           Reference is made to  registrant's  definitive  proxy statement to be
           filed with the Commission pursuant to Regulation 14(a) not later than
           December  10, 1996;  and the  information  responsive  to the item is
           incorporated herein by reference.


<PAGE>



                                     PART IV

ITEM 14. EXHIBITS, FINANCIAL STATEMENT SCHEDULES AND REPORTS ON FORM 8-K

           (a) 1. Financial Statements

                  The consolidated financial statements of Pioneer Hi-Bred
                  International, Inc. and subsidiaries filed are listed on page
                  6.

           (a) 2. Financial Statement Schedules

                  The financial statement schedules of Pioneer Hi-Bred
                  International, Inc. and subsidiaries filed are listed on page
                  6.

           (a) 3. Exhibits

                  The exhibits to the Annual Report of Pioneer Hi-Bred
                  International, Inc. filed are listed on page 9.

           (b)    Reports on Form 8-K

                  No report on Form 8-K was filed  during the fourth  quarter of
                  the year ended August 31, 1996.


<PAGE>


                              FINANCIAL STATEMENTS
                                       AND
                          FINANCIAL STATEMENT SCHEDULES
                                       OF
                       PIONEER HI-BRED INTERNATIONAL, INC.
                    FOR THE FISCAL YEAR ENDED AUGUST 31, 1996


                                      INDEX

Financial Statements

The   following   consolidated   financial   statements   of   Pioneer   Hi-Bred
International,  Inc. and  subsidiaries are incorporated by reference in Part II,
Item 8:

Independent Auditors' Report
Consolidated Balance Sheets - August 31, 1996 and 1995
Consolidated  Statements of Income - years ended August 31, 1996,  1995 and 1994
Consolidated  Statements of Shareholders'  Equity - years ended August 31, 1996,
1995 and 1994  Consolidated  Statements  of Cash Flows - years ended  August 31,
1996, 1995 and 1994 Notes to Consolidated Financial Statements
<TABLE>
<CAPTION>
<S>                                                                              <C>
                                                                                 Page

Financial Statement Schedules

The following financial  statement  schedules of Pioneer Hi-Bred  International,
Inc. and subsidiaries are submitted in response to Part IV, Item 14:

Independent Auditors' Report................................................      7

Schedule II - Valuation and Qualifying Accounts.............................      8

Exhibits to the Annual Report...............................................      9

All other financial statement  schedules have been omitted as not required,  not
applicable, or because all the data are included in the financial statements.

</TABLE>

<PAGE>


                          Independent Auditors' Report

To the Shareholders
Pioneer Hi-Bred International, Inc.

Under date of October 4, 1996, we reported on the consolidated balance sheets of
Pioneer Hi-Bred  International,  Inc. and subsidiaries as of August 31, 1996 and
1995, and the related consolidated  statements of income,  shareholders' equity,
and cash flows for each of the years in the  three-year  period ended August 31,
1996, as contained in the 1996 annual report to stockholders. These consolidated
financial statements and our report thereon are incorporated by reference in the
annual report on Form 10-K for the year 1996.  In connection  with our audits of
the aforementioned  consolidated financial statements,  we also have audited the
related 1996,  1995 and 1994  financial  statement  schedule II. This  financial
statement  schedule  is the  responsibility  of the  Company's  management.  Our
responsibility  is to express an opinion on this  financial  statement  schedule
based on our audits.

In our opinion,  such financial statement schedule,  when considered in relation
to the basic consolidated financial statements taken as a whole, present fairly,
in all material respects, the information set forth therein.

KPMG Peat Marwick LLP

Des Moines, Iowa
October 4, 1996


<PAGE>


                       PIONEER HI-BRED INTERNATIONAL, INC.

                  SCHEDULE II-VALUATION AND QUALIFYING ACCOUNTS
                                  (In millions)
<TABLE>
<CAPTION>


Column A                            Column B       Column C      Column D       Column E
--------                            --------       --------      --------       --------

                                                   Additions
                                    Balance At     Charged To                   Balance
                                    Beginning      Costs And     Deductions     At End
Description                         Of Period      Expenses      (Recoveries)*  Of Period
<S>                                  <C>           <C>           <C>            <C>

Allowance for Doubtful Accounts:

Year ended August 31, 1996.......   $     19       $     5       $     1        $    23
                                     -------        ------        ------         ------

Year ended August 31, 1995.......   $     21       $     2       $     4        $    19
                                     -------        ------        ------         ------

Year ended August 31, 1994.......   $     19       $     5       $     3        $    21
                                     -------        ------        ------         ------




<FN>

*Represents accounts charged off as uncollectible, net of recoveries of bad debts.
</FN>
</TABLE>

<PAGE>


                                      INDEX

                     Exhibits to Annual Report on Form 10-K
                           Year Ended August 31, 1996
                       PIONEER HI-BRED INTERNATIONAL, INC.
<TABLE>
<CAPTION>
<S>                                                                                <C>

                                                                                   Page

Exhibit 3.1--Articles of Incorporation (Note 1)...............................       10
Exhibit 3.2--By-Laws (Note 2).................................................       10

Exhibit 4.1--Articles of Incorporation (Note 1)...............................       10
Exhibit 4.2--By-Laws (Note 2).................................................       10
Exhibit 4.3--Rights Agreement (Note 3)........................................       10
Exhibit 4.4--Specimen of Company's Common Stock Certificate (Note 4)..........       10

Exhibit 10--Material Contracts
          .1 Stock Option Plan (Note 5).......................................       10
          .2 Deferred Compensation Plan (Note 6)..............................       10
          .3 Annual Deferred Compensation Plan (Note 7).......................       10
          .4 Consulting Agreement with a Director (Note 8)....................       10
          .5 Supplemental Executive Retirement Plan...........................    11-27
          .6 Restricted Stock Plan - Performance Based........................    28-36
          .7 Management Reward Program - Performance Based....................    37-44

Exhibit 11--Statement re:  Computation of earnings per share..................       45

Exhibit 13--Annual Report to Shareholders for the fiscal year ended August 31, 1996
          .1 Description of the Company's business............................    46-47
          .2 Selected financial data..........................................       48
          .3 Consolidated net sales and operating income (loss) by product
              statement.......................................................       49
          .4 Management's discussion and analysis of financial condition and results
              of operations...................................................    50-58
          .5 Consolidated financial statements of the Registrant, together with the
              report thereon..................................................    59-77
          .6 Research and product development.................................       78
          .7 Description of properties........................................       79
          .8 Market for the Registrant's common stock.........................       80

Exhibit 21--Subsidiaries of Registrant........................................    81-84

Exhibit 23--Consents of experts and counsel...................................       85

Exhibit 27--Financial data schedule...........................................       86

<FN>
See Notes for Exhibits to Annual Report on Form 10-K
</FN>
</TABLE>

<PAGE>


                                      INDEX


                Notes for Exhibits to Annual Report on Form 10-K
                           Year Ended August 31, 1996
                       PIONEER HI-BRED INTERNATIONAL, INC.


Note    1. Incorporated herein by reference to Exhibit 4.2 of the Company's Form
        S-8 Registration Statement, filed July 26, 1996 (file #333-08927)

Note    2. Incorporated herein by reference to Exhibit 4.3 of the Company's Form
        S-8 Registration Statement, filed July 26, 1996 (file #333-08927)

Note    3.  Incorporated  herein by reference to Exhibit 1 of the Company's Form
        8-A/A-1, filed March 14, 1995 (file #95520632)

Note    4. Incorporated herein by reference to Exhibit 4.5 of the Company's Form
        S-8 Registration Statement, filed July 26, 1996 (file #333-08927)

Note    5. Incorporated herein by reference to Exhibit 4.1 of the Company's Form
        S-8 Registration Statement, filed July 26, 1996 (file #333-08927)

Note    6.  Incorporated  herein by reference  to Exhibit 10.2 of the  Company's
        1993 Annual Report on Form 10-K, filed November 29, 1993

Note    7.  Incorporated  herein by reference  to Exhibit 10.3 of the  Company's
        1993 Annual Report on Form 10-K, filed November 29, 1993

Note    8.  Incorporated  herein by reference  to Exhibit 10.5 of the  Company's
        1995 Annual Report on Form 10-K, filed November 28, 1995


<PAGE>


                       PIONEER HI-BRED INTERNATIONAL, INC.

                     SUPPLEMENTAL EXECUTIVE RETIREMENT PLAN


                                    ARTICLE I

                            Amendment and Restatement


     Section 1.1. Amendment and Restatement. Pioneer Hi-Bred International, Inc.
hereby amends and restates the Pioneer Hi-Bred International,  Inc. Supplemental
Executive  Retirement  Plan (the  `Plan').  The amended and restated  Plan shall
apply only with respect to  Participants  who are employed by the Company or its
Subsidiaries on or after the effective date of this amendment and restatement.


     Section 1.2. Effective Date. The effective date of the amended and restated
Plan is March 14, 1989.


     Section  1.3.  Purpose.  The  purpose  of the  Plan  is to  supplement  the
retirement  benefits provided to selected executive  employees under the Pioneer
Hi-Bred International, Inc., Retirement Plan and to provide equitable retirement
and survivor benefits for key executive employees,  their surviving spouses, and
Beneficiaries.


                                   ARTICLE II

                                   Definitions


     As used in  this  Plan,  the  following  terms  shall  have  the  following
meanings:


     Section 2.1.  "Actuarial  Equivalent" means a benefit having the same value
as the benefit which such Actuarial Equivalent replaces. The determination of an
Actuarial  Equivalent  shall be based on an annual  interest rate  assumption of
eight percent (8%) and the 1984 Unisex Pension  Mortality Table with the ages in
said table set back one (1) year.

     Section  2.2.   "Base  Income"   means  the  average  of  the   Executive's
Compensation  in the last full  Calendar  Year prior to the  Executive's  Normal
Retirement,  Early  Retirement,  Death, or Disability  determination,  whichever
occurs first, and the three immediately preceding Calendar Years.

     Section 2.3.  "Beneficiary" means the person or persons designated pursuant
to Section 4.9 by a Participant,  or subsequent to the Participant's  death, the
Participant's spouse, to receive the benefits under this Plan if the Participant
and the  Participant's  spouse do not live to receive  benefits through the Term
Certain  Expiration Date. If such designation is not made,  "Beneficiary"  means
the legal representative of the Participant or of the Participant's spouse, if a
spouse survives the Participant.

     Section 2.4.  "Board of Directors"  means the Board of Directors of Pioneer
Hi-Bred  International,  Inc. or a committee of the Board of Directors appointed
to administer the Plan.

<PAGE>



     Section  2.5.  "Calendar  Year"  means the  twelve-month  period  beginning
January 1 and ending December 31.

     Section  2.6.  "Change  in  Control"  means  (a) the  acquisition,  whether
directly,  indirectly,  beneficially  (within  the  meaning of Rule 13d-3 of the
Securities  Exchange Act of 1934, as amended (the "1934 Act")), or of record, of
securities  of Pioneer  Hi-Bred  International,  Inc.  representing  twenty-five
percent  (25%) or more in  number of any  class of its then  outstanding  voting
securities by any "person" (within the meaning of Sections 13(d) and 14(d)(2) of
the 1934 Act),  including any corporation or group of associated  persons acting
in concert,  other than (I) the Company and/or (II) any employee pension benefit
plan  (within  the meaning of Section  3(2) of the  Employee  Retirement  Income
Security Act of 1974, as amended) of the Company,  including a trust established
pursuant to any such plan,  or (b) the  nomination  and election of  twenty-five
percent  (25%) or more of the  members  of the  Board of  Directors  of  Pioneer
Hi-Bred International,  Inc., without recommendation of such Board of Directors.
The  ownership of record of  twenty-five  percent (25%) or more in number of any
class  of  the  then   outstanding   voting   securities   of  Pioneer   Hi-Bred
International,  Inc. by a person  engaged in the business of acting as a nominee
for  unrelated  beneficial  owners  shall  not in and of  itself  be  deemed  to
constitute a Change in Control.

     Section 2.7. "Company" means Pioneer Hi-Bred  International,  Inc., an Iowa
corporation, and all wholly-owned subsidiaries of Pioneer Hi-Bred International,
Inc.

     Section  2.8.  "Compensation"  means all amounts  paid or  allocated by the
Company to the  Executive  for services  rendered to the Company,  including any
bonuses,  restricted  stock grants  valued on the date of grant) and any amounts
which the  Executive  would have  received but for the  Executive's  election to
defer the  compensation  in return for the  unsecured  promise of the Company to
make  payments   after   retirement   or  other   termination   of   employment.
Notwithstanding the above definition, Compensation shall not include:

               (a)    Company contributions to any qualified pension or
                      profit-sharing plan.
               (b)    Director's fees.
               (c)    Amounts paid as reimbursement for expenses incurred on
                      behalf of the Company.
               (d)    Amounts  includible  in the income of the Executive due to
                      personal use of Company  automobiles,  aircraft,  or other
                      facilities  or  services,  or due  to  payment  of  travel
                      expenses for the Executive's spouse.
               (e)    Incidental  benefits paid on behalf of the Executive  such
                      as   hospitalization   insurance,   health  and   accident
                      insurance and group life insurance.
               (f)    Extraordinary and nonrecurring  expenses such as severance
                      pay,  lump sum payments  made to  terminate an  employment
                      contract,  and  relocation  expenses,  including  mortgage
                      interest differential payments and relocation bonuses.
               (g)    Dividends paid on restricted stock.


Compensation  shall  include all amounts  contributed  under a salary  reduction
agreement by the  Participant  to a plan  maintained by the Company  pursuant to
Section 401(k) or Section 125 of the Internal Revenue Code of 1986, as amended.


<PAGE>



     Section  2.9.  "Competitive  Activities"  means (a)  engaging,  directly or
indirectly,  whether as an  employee,  independent  contractor,  consultant,  or
otherwise,  in a business  similar to the  business of the  Company,  during the
period of the  Executive's  employment  with the  Company,  and/or  (b)  owning,
managing,  operating,  controlling,  being  employed  by or  having a  financial
interest in, or being  connected in any manner with the  ownership,  management,
operation, or conduct of any such similar business, provided that mere ownership
(directly,   indirectly  or   beneficially)   of  the  stock  of  a  corporation
representing less than five percent (5%) of such corporation's outstanding stock
shall not be considered a Competitive Activity.

     Section 2.10.  "Date of Potential  Change in Control"  means the date as of
which the Board of Directors  determines that a Potential  Change of Control has
occurred under Section 5.2 of Article V.

     Section 2.11.  "Disability" means permanent long-term  disability for which
the  Executive  would be  entitled  to  disability  benefits  under any  Company
long-term  disability  plan.  Such  determination  shall  be  made  in the  sole
discretion  of the Board of Directors and the decision of the Board of Directors
shall be final.

     Section 2.12.  "Early  Retirement"  means  retirement  prior to age 65 by a
Participant who remains in Full-Time  Employment  until age 55 or, if later, the
date on which  the  Participant  completes  five (5) years of  service  with the
Company.

     Section 2.13. "Executive" means a key executive employee of the Company who
is designated as such by the Board of Directors under Section 3.1.

     Section  2.14.  "Full-Time  Employment"  means  employment  as a  full-time
salaried  employee of the Company or its  Subsidiaries,  including any period of
determined Disability.

     Section 2.15. "Integration  Benefits" means the sum of (a) Social  Security
benefits,  (b)  retirement  benefits  provided by any  jurisdiction  outside the
United  States,  whether  coverage is mandatory or elective,  (c)  retirement or
survivorship  benefits  received under any pension or profit sharing plan of the
Company that qualifies for treatment  under Section 401 of the Internal  Revenue
Code of 1986,  as amended,  but not  including  benefits  received  under a plan
including a cash or deferred  arrangement  (within the meaning of Section 401(k)
of the Internal Revenue Code of 1986, as amended) or an employee stock ownership
plan (within the meaning of Section  4975(e)(7) of the Internal  Revenue Code of
1986, as amended),  And (d) retirement or survivorship  benefits  received under
any pension or profit sharing plan of the Company  maintained for the benefit of
nonresident  alien  employees with no U.S.  source income.  For purposes of this
Plan,  "Social  Security  benefits"  shall be deemed to be those  benefits which
would be payable to the Participant or, in the event of the Participant's death,
the benefits which would be payable to the  Participant's  surviving  spouse, at
the Participant's  Social Security  retirement age. For purposes of this Plan, a
Participant  shall be  deemed  to have  elected  to  receive  any  benefits  the
Participant  is  entitled  to receive  under any  qualified  plan in the form of
15-year certain and life annuity based on the actuarial assumptions contained in
such  qualified  plan,  or, if no actuarial  assumptions  are  contained in such
qualified plan,  based upon the actuarial  assumptions  specified in the Pioneer
Hi-Bred International, Inc. Retirement Plan. The retirement benefits provided by
any  jurisdiction  outside  the  United  States  shall be deemed to be an amount
certified  by a  consulting  firm  selected  by  the  Company.  Subject  to  the
foregoing,  the  Participant's  Integration  Benefits shall be determined by the
Corporate Human Resources  Department as of the date of the Participant's Normal
Retirement,  Early Retirement,  death, or Disability determination and shall not
thereafter be adjusted on account of cost-of-living adjustments; or otherwise.


<PAGE>



     Section  2.16.  "Involuntary  Termination  of  Employment"  means  (a)  the
termination of employment of a Participant by the Company other than Termination
for Cause,  (b) the  resignation or retirement of a Participant  for Stated Good
Reason,  or (c) in the case of a Participant who is in the Full-Time  Employment
of a domestic  Subsidiary,  either (I) the sale of a substantial  portion of the
assets of the  Subsidiary  within the  meaning of Section  280G of the  Internal
Revenue Code of l986, as amended,  or (II) the acquisition by an unrelated third
party of  ownership  of more than fifty  percent  (50%) of the then  outstanding
stock,  capital, or profits interest of the Subsidiary.  The Board of Directors,
in its sole discretion,  shall determine whether the acquisition by an unrelated
third party of ownership of an interest in a foreign  subsidiary  constitutes an
Involuntary Termination of Employment.

     Section 2.17.  "Letter of Credit" means one or more irrevocable  agreements
maintained  by the Company  under which the Minimum  Amount is available for the
account of the Company.

     Section  2.18.  "Minimum  Amount"  means an amount that is no less than one
hundred percent (100%) of the change-in-control  benefits that would be provided
under  Section  4.8  of  this  Plan  if  each   Participant   were  entitled  to
change-in-control benefits on the Date of Potential Change in Control.

     Section  2.19.  "Named  Fiduciary"  means  the  Corporate  Human  Resources
Department of Pioneer Hi-Bred International, Inc.

     Section 2.20.  "Normal  Retirement"  means  retirement by a Participant who
remains  in the employ of the  Company  until age 65 at any time on or after the
Participant attains age 65.

     Section  2.21.  "Participant"  means  an  Executive  who is  designated  as
eligible to participate in this Plan by the Board of Directors.

     Section  2.22.  "Plan"  means  the  Pioneer  Hi-Bred  International,   Inc.
Supplemental Executive Retirement Plan, as amended from time to time.

     Section 2.23. "Potential Change in Control" means

     (A) The  execution  by Pioneer  Hi-Bred  International,  Inc.  of a written
agreement which, if consummated, would constitute a Change in Control.

     (B) A public  announcement  (including  any filing with the  Securities and
Exchange  Commission) by any "person"  (within the meaning of Sections 13(d) and
14(d)(2) of the 1934 Act) including any corporation or group of associated firms
acting in concert,  other than (I) the Company and/or (II) any employee  pension
benefit  plan  (within the meaning of Section  3(2) of the  Employee  Retirement
Income  Security  Act of 1974,  as  amended)  of the  Company  including a trust
established  pursuant to such plan,  of an intention to take or consider  taking
actions which, if consummated, would constitute a Change in Control.


<PAGE>



     (C) The acquisition, whether directly, indirectly, beneficially (within the
meaning of Rule 13d-3 of the 1934 Act),  or of record,  of securities of Pioneer
Hi-Bred International, Inc. representing fifteen percent (15%) or more in number
of any class of its then outstanding  voting  securities by any "person" (within
the  meaning of Sections  13(d) and  14(d)(2)  of the 1934 Act),  including  any
corporation or group of associated persons acting in concert, other than (I) the
Company  and/or (II) an employee  pension  benefit  plan  (within the meaning of
Section 3(2) of the Employee Retirement Income Security Act of 1974, as amended)
of the Company,  including a trust  established  pursuant to any such plan.  For
purposes of this Section  2.23(C),  the  ownership of record of fifteen  percent
(15%) or more in number of any class of the then outstanding  voting  securities
of Pioneer  Hi-Bred  International,  Inc. by a person engaged in the business of
acting as a nominee for unrelated  beneficial  owners shall not in and of itself
be deemed to constitute a Potential Change in Control.

     (D)  The  occurrence  of any  other  event  that  the  Board  of  Directors
determines is a Potential Change in Control.

     Section  2.24.  "Stated Good  Reason"  means a written  determination  by a
Participant  that he reasonably and in good faith cannot continue to fulfill the
responsibilities  for which he was employed.  The  Participant's  determinations
will be conclusively presumed to be reasonable and in good faith if, without the
Participant's  express written consent the Company (a) reduces the Participant's
base salary or rate of compensation as in effect immediately prior to the Change
in  Control,  or as the same may have been  increased  thereafter,  (b) fails to
continue any bonus plans in which the  Participant  was entitled to  participate
immediately  prior to the Change in Control,  substantially  in the form then in
effect,  (c) fails to  continue in effect any  benefit or  compensation  plan in
which  the  Participant  is  participating  immediately  prior to the  Change in
Control (or plans providing substantially similar benefits),  (d) assigns to the
Participants   any   duties   inconsistent   with  the   Participant's   duties,
responsibilities  or  status  immediately  prior to the  Change in  Control,  or
changes the Participant's reporting responsibilities,  titles or offices, or (e)
requires the  Participant  to change the location of his job or office,  so that
the Participant  will be based at a location more than thirty (30) miles distant
by public  highway from the location of his job or office  immediately  prior to
the Change in Control.

     Section 2.25.  "Subsidiary"  means a corporation in which a majority of the
voting securities outstanding at the time is owned directly or indirectly by the
Company  and/or by one or more of its  other  subsidiaries,  or a  non-corporate
entity in which a majority of the capital or profits  interest is owned directly
or indirectly by the Company and/or by one or more of its other subsidiaries.

     Section 2.26. "Target Pre-Retirement Survivor Benefit" means the product of
the applicable percentage multiplied by the Participant's Base Income.

Participant's Age at Date of Death                Applicable Percentage 

     Less than 50 years                                75%
     
     50 to less  than 55 years                         70% 
     
     55 to less than 60 years                          65%

     60 to less than 65 years                          60%


<PAGE>



However,   for  purposes  of  this  definition,   "Base  Income"  shall  be  the
Participant's  Compensation  in the last  Calendar Year  completed  prior to the
Participant's death in which the Participant was not disabled,  subject to bonus
and restricted stock grant  recomputations  substituting a four-year  average of
incentive  bonuses paid and restricted  stock granted for such Calendar Year and
the three  preceding  Calendar  Years in lieu of the  incentive  bonus  paid and
restricted stock granted in that Calendar Year.

     Section  2.27.  "Target  Retirement  Benefit"  means the  product  of sixty
percent (60%) and the Participant's Base Income.

     Section  2.28.   "Term  Certain   Expiration   Date"  means  the  fifteenth
anniversary of the event,  retirement or death, which causes payment of benefits
under the Plan to commence.

     Section 2.29.  "Termination  for Cause" means the termination of employment
of a Participant as a direct result of an act or acts of dishonesty constituting
a felony under the laws of the United  States or the State of Iowa and resulting
or intended to result  directly or indirectly in gain or personal  enrichment at
the expense of the Company.  An act or acts of dishonesty  constituting a felony
will be deemed to occur  only if the act or acts  constituting  the  felony  are
established  either by (a) the specific  admission of the Participant,  or (b) a
final nonappealable judgment of a court of competent jurisdiction.

     Section  2.30.  "Trust"  means  the  Pioneer  Hi-Bred  International,  Inc.
Supplemental  Executive  Retirement  Plan Trust  established  under the  Pioneer
Hi-Bred  International,   Inc.  Supplemental  Executive  Retirement  Plan  Trust
Agreement.

     Section 2.31.  "Trust  Agreement" means the Pioneer Hi-Bred  International,
Inc. Supplemental Executive Retirement Plan Trust Agreement.

     Section 2.32.  "Trustee" means the banking  organization named in the Trust
to hold  and  administer  money  and  property  in  accordance  with  the  Trust
Agreement.

     Section  2.33.  "Trust Fund" means all money and property  delivered to the
Trustee  by  the  Company  under  the  Trust  Agreement,   all  investments  and
reinvestments  made  therewith or proceeds  thereof and all earnings and profits
thereon, less all payments and charges authorized under the Trust Agreement.


                                   ARTICLE III

                                  Participation


     Section  3.1.  Participation.  The Board of  Directors  shall have the sole
discretion,  from time to time, to designate which Executives shall  participate
in this Plan. This designation shall be by resolution of the Board of Directors.


<PAGE>


                                   ARTICLE IV

                           Benefits and Distributions


     Section 4.1. Normal Retirement  Benefits.  If a Participant  remains in the
Full-Time  Employment of the Company until age 65, the Participant shall receive
a normal  retirement  benefit.  The amount of the  Participant's  annual  normal
retirement  benefit shall be equal to the Target  Retirement  Benefit reduced by
the Integration Benefits. The Participant's annual normal retirement benefit, as
so  determined,  shall be divided by twelve (12) to determine the  Participant's
monthly normal retirement benefits.  The Participant's monthly normal retirement
benefits  shall be paid on the first day of each  month  with  benefit  payments
commencing on the first day of the month immediately following the month of such
Participant's retirement.  The Participant's normal retirement benefits shall be
paid in the form of an annuity for the Participant's life.

     Section 4.2. Early  Retirement  Benefits.  The Board of Directors may grant
early  retirement  benefits  to a  Participant  who is in  Full-Time  Employment
provided the Participant has at least five years of service with the Company and
is at least age 55. The Board of Directors, in its sole discretion,  may provide
that early  retirement  benefits  begin at any time after the  granting of Early
Retirement rather than at age 65. The amount of the  Participant's  annual early
retirement  benefit  shall  be  determined  by  the  Board  of  Directors.   The
Participant's  annual  early  retirement  benefit,  as so  determined,  shall be
divided by twelve (12) to determine the  Participant's  monthly early retirement
benefit.  The Participant's  monthly early retirement  benefits shall be paid on
the first day of each month with benefit payments commencing on the first day of
the month  determined  by the Board of  Directors  as the date early  retirement
benefit payments shall commence.  The  Participant's  early retirement  benefits
shall be paid in the form of an annuity for the Participant's life.

     Section 4.3.  Post-Retirement  Death Benefits.  If a Participant dies after
benefits  become  payable  under  Section  4.1 or  Section  4.2,  but before the
Participant  receives  payment of normal or early  retirement  benefits  for 180
months,  the  Participant's  surviving spouse, or in the event the Participant's
spouse  does not  survive  him or such  spouse  dies  prior to the Term  Certain
Expiration Date, the Participant's  Beneficiary,  shall be entitled to receive a
post-retirement  death benefit. The amount of the annual  post-retirement  death
benefit shall be equal to the Participant's Target Retirement Benefit reduced by
the amount of Integration Benefits. The annual post-retirement death benefit, as
so  determined,  shall be  divided  by  twelve  (12) to  determine  the  monthly
post-retirement death benefits. The monthly post-retirement death benefits shall
be paid on the first day of each month, with benefit payments  commencing on the
first  day of the month  immediately  following  the month of the  Participant's
death  and  continuing   until  the  Term  Certain   Expiration   Date.  If  the
Participant's   spouse   survives  the  Term  Certain   Expiration   Date,   the
Participant's  spouse shall be entitled to receive a continuing  post-retirement
death benefit in an amount equal to two-thirds (2/3) of the Participant's Target
Retirement Benefit reduced by the Integration  Benefits.  The surviving spouse's
continuing  post-retirement  death  benefits  shall  be paid  in the  form of an
annuity for the life of the Participant's surviving spouse.


<PAGE>



     Section 4.4.  Pre-Retirement Survivor Benefits. If a Participant dies prior
to age 65 but while in Full-Time  Employment and if the  Participant is survived
by  the  participant's   spouse,  the  Participant's   spouse  shall  receive  a
pre-retirement  survivor benefit. In the event the Participant's spouse does not
survive him or the  Participant's  spouse  survives  but does not live until the
Term  Certain  Expiration  Date,  the  designated  Beneficiary  shall  receive a
pre-retirement  survivor  benefit.  The  amount  of  the  annual  pre-retirement
survivor benefit payable to the Participant's surviving spouse shall be equal to
the Target Pre-Retirement  Survivor Benefit reduced by the Integration Benefits.
The  amount  of  the  annual  pre-retirement   survivor  benefit  payable  to  a
Beneficiary other than the Participant's  surviving spouse shall be equal to the
Target  Pre-Retirement  Survivor Benefit less Integration  Benefits to which the
Participant's   spouse  would  have  been  entitled  through  the  Term  Certain
Expiration Date. The annual  pre-retirement  survivor benefit, as so determined,
shall be divided by twelve (12) to determine the monthly pre-retirement survivor
benefit. The monthly pre-retirement survivor benefits shall be paid on the first
day of each month,  with  benefit  payments  commencing  on the first day of the
month immediately  following the month of the Participant's death and continuing
until the Term Certain Expiration Date.

     Section 4.5.  Termination  of  Employment  Benefits.  Except as provided in
Section 4.8, if a Participant's employment terminates prior to age 65, either by
the Company or by the Participant,  and either with or without cause, no further
amounts  shall be paid under any  provision  of this  Plan,  unless the Board of
Directors,  in its sole  discretion,  shall  provide that  benefits will be paid
regardless of the Participant's termination of employment,  provided that death,
Early Retirement and determined  Disability shall not be deemed a termination of
employment for purposes of this Section 4.5.

     Section 4.6. Lump Sum Payment.  At any time, in the sole  discretion of the
Board of Directors,  the Actuarial  Equivalent of the future  benefits due under
the Plan on behalf of any recipient may be computed and paid in one lump sum.

     Section 4.7. Prohibition of Competitive  Activities.  Except as provided in
Section 4.8, if a  Participant  engages in  Competitive  Activities,  no further
benefits shall be payable under any provision of this Plan.

     Section 4.8. Change-in-Control Benefits.

     (a)  Notwithstanding  any other provision of this Plan, in the event of the
Involuntary  Termination  of Employment  of a Participant  within five (5) years
following a Change in Control,  the Participant shall receive  change-in-control
benefits.  Such  change-in-control  benefits shall be paid in lieu of and not in
addition to any other benefits payable under this Plan.

     (b)  If,  on the  date  of the  Participant's  Involuntary  Termination  of
Employment,  the sum of the  Participant's  age and years of  service  equals at
least  fifty-five  (55),  the  amount  of  the  Participant's  change-in-control
benefits shall be an amount equal to the lump sum present value,  as of the date
of the  Participant's  Involuntary  Termination  of  Employment,  of the monthly
normal  retirement  benefits that would be payable under this Plan determined as
if the Participant had (i) remained in Full-Time  Employment  until age 65, (ii)
retired on such date,  and (iii)  received  monthly  normal  retirement  benefit
payments  for 180 months.  In all other cases,  in the event of the  Involuntary
Termination  of Employment  of a  Participant,  the amount of the  Participant's
change-in-control  benefits  shall be an  amount  equal to the lump sum  present
value as of the date of the Participant's  Involuntary Termination of Employment
of the monthly early  retirement  benefits that would be payable under this Plan
determined as if the Participant had (i) remained in Full-Time Employment until


<PAGE>


age 55 (or, if later,  the date on which would have  completed five (5) years of
service),  (ii) retired on such date and (iii) received monthly early retirement
benefit  payments  for 180  months  equal  to The  Actuarial  Equivalent  of the
Participant's normal retirement benefits.

     (c) The  Participant's  change-in-control  benefits shall be paid in a lump
sum no later  than  sixty  (60) days  following  the  Participant's  Involuntary
Termination of Employment. In the event of the Participant's death following the
date of the  Participant's  Involuntary  Termination  of Employment but prior to
payment of the change-in-control  benefits, the Participant's  change-in-control
benefits  shall  be paid to the  Participant's  spouse,  or,  in the  event  the
Participant's spouse does not survive him, the Participant's Beneficiary.

     (d) For purposes of  determining  the present value of such normal or early
retirement  benefits  for  purposes  of this  Section  4.8,  the  interest  rate
assumption shall be the rate used by the Pension Benefit Guaranty Corporation to
determine the present value of an immediate  benefit upon plan termination as of
the first day of the month  immediately  preceding the date of the Participant's
Involuntary Termination of Employment.

     Section 4.9. Designation of Beneficiary. The Participant, or, subsequent to
the Participant's death, the Participant's spouse may designate a beneficiary or
beneficiaries,  primary and  contingent,  to receive any  post-retirement  death
benefits or  pre-retirement  survivor  benefits  payable  under this Plan if the
Participant and the Participant's spouse do not live to receive benefits through
the Term Certain  Expiration Date. Such designation shall be in writing,  signed
by the  Participant  or the  Participant's  spouse,  as the  case  may  be,  and
delivered to the Corporate  Human  Resources  Department  of the Company,  to be
effective  when  received  by the  Corporate  Human  Resources  Department.  The
Participant,  or the  Participant's  spouse,  as the case may be, shall have the
right to change such designation,  without the consent of any prior beneficiary,
by  filing a new  designation,  in the same  manner,  with the  Corporate  Human
Resources  Department of the Company. Any such changes shall be deemed to revoke
all prior  designations,  unless a contrary intention is expressly stated in the
change of designation.  In the event such designation is not made, any remaining
payments to be paid under this Plan shall be paid to the legal representative of
the  Participant  or of the  Participant's  spouse,  if a  spouse  survives  the
Participant.

     Section 4.10. Facility of Payment. If the Board of Directors determines
that a Participant,  his spouse or Beneficiary is unable to care for his affairs
and a legal  representative has not been appointed for such person, the Board of
Directors  may (but shall not be  required  to) direct  that any  payments  made
hereunder shall be made to a spouse,  parent,  child, or other blood relative of
such  person,  or to anyone  found by the Board of  Directors  properly  to have
incurred expense for the support and maintenance of such Participant, his spouse
or  Beneficiary,  so long as, under  applicable law, such payments are permitted
and discharge completely all liabilities of the Company under the Plan.

     Section 4.11. Taxes. The Company shall deduct from any distributions  under
this Plan the amount of any taxes required to be withheld from such distribution
by any federal,  state or local  government.  The  Participants,  their spouses,
Beneficiaries  and  personal  representatives  shall  bear any and all  federal,
state, local or other taxes imposed on amounts distributed under this Plan.


<PAGE>


                                    ARTICLE V

                               Funding of Benefits


     Section  5.1.  Notification.  Immediately  upon  gaining  knowledge  that a
Potential  Change in Control  has  occurred  or is likely to occur,  a member or
members of the Board of Directors  shall notify the President of Pioneer Hi-Bred
International,  Inc. The notification  shall be a written  certification of such
member or  members  to the  President  setting  forth the facts  upon which such
knowledge is based.

     Section  5.2.  Meeting  of the  Board of  Directors.  Upon  receipt  of the
notification required by Section 5.1 of this Article V, the President or any two
members of the Board of Directors  shall call a special  meeting of the Board of
Directors to determine  whether a Potential  Change in Control has occurred.  If
the  Board of  Directors  determines  that a  Potential  Change in  Control  has
occurred,  the Board of  Directors  shall  direct the  appropriate  officers  of
Pioneer Hi-Bred  International Inc. to fund the Trust in accordance with Section
5.3 of this Article V.

     Section 5.3. Funding the Trust. On the Date of potential Change in Control,
or as soon as is  administratively  feasible  following  the  Date of  Potential
Change in Control,  Pioneer Hi-Bred International,  Inc. shall contribute to the
Trust  (a) a Letter of Credit in the  Minimum  Amount,  or (b) cash or  property
equal in  value  to the  Minimum  Amount.  In the  event  that  Pioneer  Hi-Bred
International,  Inc.  funds the  Trust  with a Letter  of  Credit,  the Board of
Directors  shall cause the  Minimum  Amount to be drawn and  contributed  to the
Trust upon the  occurrence of a Change in Control,  or earlier in the discretion
of the Board of Directors.

     Section 5.4. The Trust.  The Trust Fund shall be held and  administered for
the  sole  purpose  of  providing  deferred   compensation  to  Participants  in
accordance  with  the  provisions  of this  Plan  and the  Trust  Agreement  and
defraying   reasonable   expenses  of  administration  in  accordance  with  the
provisions  of  the  Trust  Agreement;  provided  that  if (a)  Pioneer  Hi-Bred
International,  Inc. is unable to pay its debts as they mature or as they become
due or (b) Pioneer Hi-Bred International, Inc. files or has filed against it any
proceedings under the bankruptcy laws of the United States or the State of Iowa,
the Trust Fund shall be used to satisfy the claims of the general  creditors  of
Pioneer Hi-Bred International, Inc.


                                   ARTICLE VI

                      Administration and Amendment of Plan


     Section  6.1.   Authority  of  Board  of  Directors.   The  Plan  shall  be
administered  by the Board of  Directors.  'The  Board of  Directors  shall have
plenary  authority to select  employees who are eligible to  participate  in the
Plan, to make all determinations required under the Plan, to interpret the Plan,
to decide all questions of fact arising  under the Plan, to formulate  rules and
regulations   covering  the  operation  of  the  Plan  and  to  make  all  other
determinations  necessary or desirable in the  administration  of the Plan.  The
decision of the Board of Directors on any questions  concerning or involving the
interpretation  or  administration  of the Plan  shall be final and  conclusive.
While this Plan is  intended  to  supplement  the  benefits  provided  under the
Pioneer  Hi-Bred  International,   Inc.  Retirement  Plan,  in  interpreting  or
administering this Plan, the Board of Directors need not consider or be bound by
any interpretation of the provisions of the Pioneer Hi-Bred International,  Inc.
Retirement Plan or the manner in which such plan is administered.


<PAGE>



     Section 6.2.  Claim for Benefits.  Any claim for benefits  shall be made in
writing to the Named Fiduciary.  The claim for benefits shall be reviewed by the
Named Fiduciary and the Board of Directors.  If any part of the claim is denied,
the Named  Fiduciary  shall  provide a written  notice,  within ninety (90) days
after the receipt of the claim by the Named  Fiduciary,  setting forth:  (a) the
specific reasons for the denial; (b) specific reference to the provision of this
Plan or any agreement  entered into between the Participant and the Company upon
which the denial is based;  (c) any additional  information  the claimant should
furnish to perfect  the claim;  and (d) the steps to be taken if a review of the
denial is desired.

     If a claim is  denied  and a review is  desired,  the  Participant  (or the
Participant's Beneficiary,  as the case may be) shall notify the Named Fiduciary
in writing  within sixty (60) days. In requesting a review,  the  Participant or
Beneficiary may review this Plan or any documents  relating to it and submit any
written issues and comments he may feel appropriate.  In its sole discretion the
Board of  Directors  shall then review the claim and provide a written  decision
within sixty (60) days.  This decision shall state the specific  reasons for the
decision and shall include  reference to specific  provisions of the Plan or any
agreement  entered  into  between the  Participant  and the Company on which the
decision is based.

     Section 6.3. Information Concerning Integration Benefits. The recipient
of  benefits  under any  provision  of this Plan shall be required to inform the
Company of any amount of Social Security benefits,  retirement benefits provided
by any  jurisdiction  outside the United  States or any other amount which might
affect  benefits  under this Plan,  to be  received  by the  recipient.  If such
information  is  requested  by the  Company,  but  adequate  information  is not
received prior to five (5) days before the payment date of any payment dependent
on the  information  requested,  the benefit  payment  may be  delayed,  without
interest, until ten (10) days after such information is received.

     Section  6.4.  Amendment  and  Termination.  The  Plan  may at any  time be
amended, modified or terminated by the Board of Directors.  Prior to a Change in
Control,  no amendment,  modification or termination shall,  without the written
consent of the affected Participant,  spouse or Beneficiary, reduce the benefits
any such  person was  receiving  under  this  Plan.  In the event of a Change in
Control,  no amendment,  modification or termination shall,  without the written
consent of the affected Participant, spouse, or Beneficiary, reduce the benefits
such  person  was  receiving  or the  benefits  that  would  be  paid  upon  the
Participant's  retirement,  death,  or termination of employment,  including the
benefits that would be paid upon the Participant's  Involuntary Termination of a
Participant  following  a  Change  in  Control,  under  the  terms  of the  Plan
immediately prior to the Change in Control.



                                   ARTICLE VII

                                  Miscellaneous


     Section 7.1. No Assignment. The right of a Participant (or Beneficiary,  as
the case may be) to receive any distribution under the Plan shall not be subject
in any manner to anticipation,  alienation, sale, transfer,  assignment, pledge,
encumbrance,  levy or charge, and any attempt so to anticipate,  alienate, sell,
transfer,  assign,  pledge,  encumber,  levy or charge  the same  shall be void;
provided, however, that the right to receive payment is transferable by the laws
of descent and distribution.


<PAGE>



     Section  7.2.  Unsecured  Claim.  The  right  of any  Participant  (or  his
Beneficiary or personal  representative)  to receive any distribution  under the
Plan  (directly  from the  Company or through the Trust)  shall be an  unsecured
claim  against the general  assets of the Company,  and neither the Plan nor the
Trust entitle a Participant (or his Beneficiary or personal representative) to a
greater priority than the Company's general creditors. Assets, if any, which may
be set aside by the Company for accounting purposes shall not in any way be held
in trust for,  or be  subject  to, any prior  claims by the  Participant  or his
Beneficiary.  The Company  shall have no duty  whatsoever to purchase any assets
for purposes of providing benefits under this Plan. The Company's promise to pay
the benefits provided under this Plan shall be a contractual  obligation that is
not evidenced by notes or secured in any way.

     Section 7.3. No Rights in Life Insurance. If the Company elects to purchase
one or more life  insurance  contracts to provide the Company with funds to make
payments  under  this  Plan,  the  Company  shall  at all  times be the sole and
complete  owner  and  beneficiary  of  such   contracts,   and  shall  have  the
unrestricted right to use all amounts and to exercise all options and privileges
thereunder without the knowledge or consent of the Participant, his Beneficiary,
or any other person, and no Participant,  Beneficiary, or person, other than the
Company,  shall have any right,  title, or interest whatsoever in or to any such
contract.  The Participant shall cooperate with all reasonable  requests made by
the  Company or any  insurance  carrier  selected  by the  Company to  determine
whether the Participant is insurable at standard  rates,  including any requests
made by the Company or such insurance  carrier that the Participant  submit to a
medical examination, or provide other information relevant to a determination of
whether  the  Participant  is  insurable  at  standard   rates,   including  the
Participant's  current health status,  health history of the Participant and any
family  members,  and the  activities  engaged in by the  Participant  including
dangerous or illegal activities.

     Section  7.4.  No  Contract  of  Employment.  Nothing in this Plan shall be
construed as a contract of employment  between the Company and any  Participant.
Nothing  in this Plan shall be deemed to  constitute  a  contract  for  services
between the  Company and the  Participant,  and nothing  contained  in this Plan
shall be  deemed  to give the  Participant  any  right  to  continue  furnishing
services to the Company or the Company any right to demand such services. Except
as  provided  in  Section  4.8,  nothing in this Plan  shall be  construed  as a
limitation  of the right of the Company to discharge  the  Participant,  with or
without cause.

     Section 7.5.  Binding Effect.  This Plan shall be binding upon the Company,
its  successors  and  assigns,  and  upon  the  Participant,   his  spouse,  his
Beneficiary,  and  their  heirs,  legatees,  executors  and  personal  or  legal
representatives.

     Section 7.6.  Gender;  Headings.  Any  masculine  pronoun shall include the
feminine and the singular shall include the plural, and vice versa. The headings
in this Plan are for convenience of reference only.

     Section  7.7.  Severability.  If any  provision  of this Plan is held to be
illegal,   invalid,   or   unenforceable,   such  illegality,   invalidity,   or
unenforceability  shall not affect the remaining  provisions  of this Plan,  and
such provisions shall be construed and enforced as if such illegal,  invalid, or
unenforceable provision had never been inserted herein.

     Section 7.8.  Governing Law. This Plan shall be governed by the laws of the
State of Iowa without reference to the principles of conflicts of law therein.


<PAGE>


IN WITNESS WHEREOF, the Company has caused this instrument to be executed by its
duly authorized officers.

                                          PIONEER HI-BRED INTERNATIONAL, INC.

                                          By:  /s/ Thomas N. Urban
                                          ---  -------------------
                                                   Thomas N. Urban
                                                   President
By:  /s/Dale L. Porter
---  -----------------
        Dale L. Porter
        Secretary

TO:     Corporate Human Resources Department
        Pioneer Hi-Bred International, Inc.
        Suite 700, Capital Square
        Des Moines, Iowa  50309
                                                 RE:    Beneficiary Designation

Gentlemen:

Pursuant to Section 4.9 of the Pioneer Hi-Bred International,  Inc. Supplemental
Executive  Retirement Plan,  effective as amended and restated March 14, 1989, I
hereby designate that benefits payable under Sections 4.4, 4.5, or 4.8(c) of the
Plan be paid to the following  person(s) in the indicated  proportions  (if none
indicated,  benefits  shall  be  payable  in  equal  proportion  to each  person
designated):

           (Designated Beneficiaries)                       (Proportion)

           =========================                        ==============
           =========================                        ==============

If any person is  deceased at the time of any payment to be made under the Plan,
the payment allocable to that person shall be made to the following person(s) in
the indicated proportions (if none indicated, benefits shall be payable in equal
proportion to each person designated):

           (Designated Beneficiaries)                       (Proportion)

           ==========================                       ==============
           ==========================                       ==============

Notwithstanding  any provision of the Plan and this designation to the contrary,
in the event that my spouse  survives me,  he/she  [shall]  [shall not] have the
right to revoke any  designation  of  beneficiaries  made  herein and  thereupon
designate the person(s) to receive the benefits  described in Sections 4.3, 4.4,
or 4.7 of the Plan.

This  beneficiary  designation  shall  remain  in full  force  unless  and until
canceled or  superseded  by written  notice  executed by me and delivered to you
before my death.

                                                 Very truly,
                                                 ------------------------------


<PAGE>


                              AMENDMENT TO THE SERP


        1)  "Fiscal" replaces the word "Calendar" in Sections 2.2 and 2.26.

        2)  Section 2.5 be deleted in its entirety.

        3)  A new  Section  2.7 should be added which shall read in its entirety
            as follows:

            Section  2.7  "Company  Long-Term  Disability  Plan"  means  a group
            disability  plan  which is  sponsored  by the  Company or one of its
            Subsidiaries  and for which  premiums are paid by the Company or one
            of its  Subsidiaries or which is funded by the Company or one of its
            Subsidiaries without the payment of premiums by the Participant.  It
            does not include a plan or a portion of the plan for which  premiums
            are paid by the Participant.

        4)  The first sentence of Section 2.8 be deleted and  replaced  with the
            following:

            "Compensation" means all amounts paid or allocated by the Company to
            the  Executive for services  rendered to the Company,  including any
            bonuses, restricted stock grants and any amounts which the Executive
            would have  received but for the  Executive's  election to defer the
            compensation  in return for the unsecured  promise of the Company to
            make payments after  retirement or other  termination of employment.
            Restricted  stock  grants,  bonuses and other  compensation  will be
            included  as part of  compensation  for the Fiscal Year in which the
            service was rendered. Restricted Stock will be valued on the date of
            grant without regards to restrictions.

        5)  The following language in Section 2.12 should be deleted:

            "any  Long-Term  disability  plan sponsored by the Company or a
             subsidiary" and replaced with: "Company Long-Term Disability Plan"

        6)  Capitalize Company Long Term Disability Plan in Section 2.11.

        7)  A new Section 2.12 should be added which reads as follows:

            Section  2.12.   "Disability   Retirement"  means  retirement  of  a
            participant  who has a disability  and who has requested  disability
            retirement,  and  that is  accepted  and  approved  by the  Board of
            Directors in its sole discretion prior to a participant reaching age
            65.

        8)  Section 2.12 shall be deleted and replaced with the following:

            Section  2.12  "Early  Retirement"  means  retirement  accepted  and
            approved by the Board of Directors in its sole discretion prior to a
            Participant  reaching age  sixty-five  (65) who remains in Full Time
            Employment until age fifty-five (55), or if later, the date of which
            the  Participant  completes  five  (5)  years  of  service  with the
            Company.

        9)  A  new  Section 2.14  be added which shall read in  its entirety  as
            follows:

            Section  2.14  "Fiscal  Year"  means the 12 month  period  beginning
            September 1 and ending August 31.


<PAGE>



        10) The following should be included at the end of Section 2.14:

            "unless  Disability  Retirement  is accepted  and  approved by the
             board of directors."

        11) The second  sentence of Section  2.15 shall be deleted and replaced
            with the following:

            For  purposes  of this Plan,  "Social  Security  Benefits"  shall be
            deemed  to be zero  until the  Participant  first  begins  receiving
            Social  Security  benefit  payments.   Thereafter,  Social  Security
            benefits shall equal the actual amount of Social  Security  benefits
            which the  Participant  receives when the  Participant  first begins
            receiving benefits.

        12) The following should be included after "Subject to the foregoing" in
            the last sentence of Section 2.15:

            "and as set forth in Article IV."

        13) The following sentence be added after the last sentence of 2.26:

            For  purposes  of the  recomputation,  restricted  stock  grants and
            bonuses  will be  included  in  Compensation  for the Fiscal Year in
            which the services was rendered.  Restricted stock will be valued on
            the date of grant without regards to restrictions.

        14) The following shall be added after the end of the second sentence of
            Section 4.1:

            If necessary,  the normal  retirement  benefit will be adjusted when
            the Participant begins receiving Social Security Benefits.

        15) The  first  three sentences  of  Section  4.2  shall  be deleted and
            replaced with the following:

            Section 4.2  Early Retirement Benefits.
            If  early  retirement  is  accepted  and  approved  by the  Board of
            Directors in its sole discretion,  a Participant who is in Full Time
            Employment  and has  reached  age  fifty-five  (55) and has five (5)
            years of service  will  receive  an early  retirement  benefit.  The
            amount of the Participant's  early retirement benefit shall be equal
            to  the  Target  Retirement   Benefit  reduced  by  the  Integration
            Benefits.  If  necessary,  the  early  retirement  benefit  will  be
            adjusted  when the  Participant  begins to receive  Social  Security
            benefits.

        16) A new Section 4.3 should be added which reads as follows:

            Section 4.3.  Disability Retirement Benefits.
            If the  Participant  so requests,  and if  Disability  Retirement is
            accepted  and  approved  by the  Board  of  Directors  in  its  sole
            discretion,  a  Participant  who has a  disability  will  receive  a
            disability  retirement benefit in lieu of any benefits that might be
            paid  under  Section  4.1 or 4.2.  The  amount of the  Participant's
            disability   retirement   benefit  shall  be  equal  to  the  Target
            Retirement Benefit reduced by the Integration Benefit and the amount
            that the  Participant  is  receiving  under  any  Company  Long-Term
            Disability Plan.


<PAGE>



            Prior to being entitled to receive benefits  described under clauses
            (c) and (d) of the  first  sentence  of  Section  2.15  because  the
            Participant  is  receiving  disability  benefits,  there  will be no
            reduction for such  benefits.  After the  Participant is entitled to
            receive  benefits  described  under clauses (c) and (d) of the first
            sentence of Section  2.15,  disability  retirement  benefits will be
            recalculated  with a reduction  for such  benefits as  described  in
            Section 2.15.

            If necessary,  the  disability  retirement  benefit will be adjusted
            when the Participant begins to receive Social Security Benefits.  It
            also will be adjusted based upon any adjustment in the benefits that
            are payable under any Company long term disability plan.

            The  Participant's  annual  disability  retirement  benefit,  as  so
            determined  shall  be  divided  by  twelve  (12)  to  determine  the
            Participant's   monthly   disability   retirement   benefits.    The
            Participant's  monthly disability  retirement benefits shall be paid
            on the first day of each month with benefit  payments  commencing on
            the  first  day  of  the  month  immediately   following  the  month
            Disability  Retirement  is approved.  The  Participant's  disability
            retirement  benefits shall be paid in the form of an annuity for the
            Participant's life.

        17) The following  language should be deleted from the first sentence of
            Section 4.3:

            "4.1 or Section 4.2 but before the Participant  receives  payment of
            normal or early  retirement  benefits  for 180 months" and  replaced
            with "4.1,  Section  4.2 or Section  4.3 but before the  Participant
            receives payment of normal, early or disability  retirement benefits
            for 180 months,"

        18) The second  sentence  of Section 4.3 should be deleted  and replaced
            with the following:

            The amount of annual  post-retirement  death benefits shall be equal
            to the annual benefit payable to the Participant  under Section 4.1,
            4.2 or 4.3 except as set forth below. Reductions for Social Security
            benefits and Company  Long-Term  Disability  Plan  payments  will no
            longer be based  upon what was paid to the  Participant  but will be
            adjusted  based  upon the  amount of the  benefits  payable  under a
            Company  Long-Term  Disability  Plan or amount  of  Social  Security
            benefits  payable  to the  surviving  spouse  or  other  Beneficiary
            because of the  Participant's  death.  If Participant  was receiving
            disability retirement benefits,  and the Participant did not receive
            benefits  described  under clauses (c) and (d) of the first sentence
            of Section 2.15, post-retirement death benefits will also be reduced
            by the payments to surviving spouse or the Participant's Beneficiary
            received  from benefits  described  under clauses (c) and (d) of the
            first sentence of Section 2.15.

        19) The following  should be deleted from the fifth  sentence of Section
            4.3:

            "or the  Participant's  Target  Retirement  Benefit  reduced  by the
            Integration Benefits" and replaced by the following:  "of the amount
            of annual  post-retirement  death benefits that the surviving spouse
            was receiving at the Term Certain Expiration Date."


<PAGE>



        20) The following  should be added at  the end of the third  sentence of
            Section 4.4:

            "and the amount of benefits the surviving  spouse  receives under a
            Company Long-Term Disability Plan."

        21) The following language should be deleted from the fourth sentence of
            Section 4.4:

            "to which the Participant's  spouse would have been entitled through
            the Term Certain  Expiration  Date" and replaced with the following:
            "and the amount of benefits the Beneficiary receives under a Company
            long term disability plan."

        22) Add the following at the end of Section 4.4:

            For the purposes of this Section only, the Social Security  Benefits
            included in the  Integration  Benefits shall be the Social  Security
            Benefits  payable  to the  Surviving  Spouse  or  other  beneficiary
            because of the Participant's  death. If necessary,  the benefit will
            be adjusted  based upon the amount of the benefits  payable  under a
            Company  long term  disability  plan or  amount  of Social  Security
            benefits payable to the surviving spouse or other  Beneficiary.  The
            monthly  pre-retirement  death benefits for Beneficiaries other than
            the  surviving  spouse  should  only be paid until the Term  Certain
            Expiration Date.

        23) In Section 4.5 replace "and determined  Disability" with "Disability
            and Disability Retirement".

        24) In the last sentence of Section 4.8(b) delete the following:

            "equal  to the  Actuarial  Equivalent of the Participant's  normal
            retirement benefits."

        25) The  following  shall be added  after the last  sentence  of Section
            4.8(d):

            For the  purposes of this  Section  4.8,  Social  Security  Benefits
            included in the Integration Benefits will be zero.

        26) The following section be added at Section 4.12:

            Section 4.12  Benefits Calculations.
            If  necessary,  the  Company  will  calculate  a  benefit  based  on
            estimated  bonus,  restricted  stock  awards and  compensation.  The
            estimates will be determined by the Company in its sole  discretion.
            The  Company  will  recalculate  the  benefits  based on the  actual
            amounts  and will adjust the next  payment so that that  payment and
            all previous  payments equal the amount the employee would have been
            entitled to if the employee  had received his benefits  based on the
            actual  amount  from  the  beginning  of the  payments.  Thereafter,
            payments will be based on the actual amounts.

        27) The following  should replace  "retirement" in the third sentence of
            Section 6.4 "Normal, Early or Disability Retirement".

        28) In Sections 4.5 and 7.4, "Section  4.8"  should  be  replaced  with
            "Section 4.9".

        29) The  section  numbers be  renumbered as appropriate  to reflect the
            above changes.



<PAGE>


                       PIONEER HI-BRED INTERNATIONAL, INC.

                   RESTRICTED STOCK PLAN -- PERFORMANCE BASED


SECTION 1.  ESTABLISHMENT AND PURPOSE

     1.1 Establishment. Pioneer Hi-Bred International, Inc. hereby establishes a
stock reward plan for key management employees, as described herein, which shall
be known as the PIONEER HI-BRED  INTERNATIONAL,  INC.  RESTRICTED  STOCK PLAN --
PERFORMANCE-BASED (hereinafter called the "Plan").

     1.2 Effective Date. The effective date of the Plan is September 1, 1995.

     1.3  Purpose.  The  purpose of this Plan is to align the  interests  of key
management  employees with the long-term  interest of  shareholders  through the
ownership and retention of Company stock.

SECTION 2.  DEFINITIONS

     Whenever used herein, the following terms shall have the meanings set forth
below:

     (a) "Base Salary" means a Participant's  base annual salary as of August 31
of the Plan Year without  reduction  for  contributions  or deferrals to various
plans.
     (b) "Board" means the Board of Directors of Pioneer Hi-Bred  International,
Inc.
     (c)  "Change  in  Control"  means (i) the  acquisition,  whether  directly,
indirectly, beneficially (within the meaning of Rule 13d-3 of the Securities and
Exchange Act of 1934, as amended (the "1934 Act")),  or of record, of securities
of Pioneer Hi-Bred International, Inc. representing twenty-five percent (25%) or
more in number of any class of its then  outstanding  voting  securities  by any
"person"  (within the meaning of Sections  13(d) and  14(d)(2) of the 1934 Act),
including  any  corporation  or group of associated  persons  action in concert,
other than (A) the Company and/or (B) any employee  pension benefit plan (within
the meaning of Section 3(2) of the Employee  Retirement  Income  Security Act of
1974, as amended) of the Company,  including a trust established pursuant to any
such plan, or (ii) the nomination  and election of twenty-five  percent (25%) or
more  of  the  members  of  the  Board  of  Directors  of  the  Company  without
recommendation  of such Board of  Directors.  The  ownership of record of 25% or
more in number of any class of the then  outstanding  voting  securities  of the
Company by a person  engaged in the business of acting as nominee for  unrelated
beneficial owners shall not in and of itself be deemed to constitute a Change in
Control.
     (d) "CIC Participant" means an employee 1) who would have been eligible for
a grant in  respect  of the Plan Year prior to the Plan Year in which the Change
in Control occurs  regardless of whether he or she was terminated after the Plan
Year but before the grant or 2) who but for his or her  termination,  would have
been  eligible  for a grant in  respect  of the Plan Year in which the Change in
Control occurred.
     (e)  "Committee"  means  the  Compensation  Committee  of the  Board or any
successor Committee.
     (f)  "Company"   means  Pioneer  Hi-Bred   International,   Inc.,  an  Iowa
corporation, and any division or subsidiary thereof.
     (g)  "Corporate  Management  Committee"  means the  Company's  committee of
executive  officers  selected by the chief  executive  officer or any  successor
committee. (h) "The Cumulative Three Years Earnings Per Share" means for a given
Plan  Year the sum of the  Earnings  Per  Share  for the  Plan  Year and the two
previous Plan Years.  Plan year for years prior to the  effective  date shall be
the Company's fiscal year.

<PAGE>



     (i)  "Earnings  Per  Share"  means  the  after  tax  earnings  per share of
outstanding  stock plus or minus  adjustments to remove the impact of unusual or
nonrecurring events.
     (j) "EPS Growth  Percentage"  means the percentage that  corresponds to the
Cumulative  Three Years  Earnings  Per Share for the given Plan Year as shown on
Attachment  1 or as may be modified  prior to the Plan Year by the  Compensation
Committee.  Minimum is 0% with no maximum.  Interpolation  of actual  results is
computed  between table points.  Points beyond 25% are calculated using the same
methodology used in calculating the EPS Growth Percentage on Attachment 1.
     (k) "EPS Multiplier" means the multiplier as calculated in Section 5.2.
     (l) "Fair  Market  Value" of a share of Common  Stock of the Company  shall
mean,  with  respect  to the date in  question,  either  (x) the  average of the
highest and lowest  selling  prices or (y) the closing sale price of such stock,
as selected by the Committee;  or if the Company's Common Stock is not quoted by
NASDAQ, traded on a national exchange,  or otherwise traded publicly,  the value
determined, in good faith, by the Committee.
     (m)  "Involuntary  Termination of Employment"  means (a) the termination of
employment of a CIC Participant by the Company other than Termination for Cause,
(b) the  resignation or retirement of a CIC  Participant for Stated Good Reason,
or (c) in the case of a CIC Participant who is in the full-time  employment of a
domestic Subsidiary,  either (I) the sale of a substantial portion of the assets
of the  Subsidiary  within the meaning of Section 280G of the  Internal  Revenue
Code of 1986, as amended, or (II) the acquisition by an unrelated third party of
ownership  of more  than  fifty  percent  (50%) of the then  outstanding  stock,
capital, or profits interest of the Subsidiary.  The Board of Directors,  in its
sole discretion,  shall determine  whether the acquisition by an unrelated third
party of  ownership  of an  interest  in a  foreign  subsidiary  constitutes  an
Involuntary Termination of Employment.
     (n) "Key Management  Employee" means those employees eligible under Section
4.
     (o)  "Operations   Committee"  means  the  Company  Committee  of  officers
responsible for various operations as selected by the chief executive officer or
any successor committee.
     (p) "Outstanding  Stock" means the weighted average daily stock outstanding
without giving effect to the dilutive impact of outstanding options.
     (q) "Participant Pay Band" means that Pay Band for which the Participant is
categorized pursuant to Section 5.3.
     (r) "Pay Band Target  Percentage"  means the Reward targets as a percent of
Base Salary for a Pay Band or portion  thereof as set forth in Section  5.4. (s)
"Participant"  means  a  Key  Management  Employee  who  is  awarded  and  holds
Restricted Stock pursuant to the Plan.
     (t) "Pay Band" means job evaluation  categories I - VI. The Pay Band may be
further divided or consolidated as necessary.
     (u) "Plan" means the Pioneer Hi-Bred  International,  Inc. Restricted Stock
Plan -- Performance-Based, as amended from time to time.
     (v) "Plan Year" means the 12 month period beginning  September 1 and ending
August 31.
     (w)  "Prior to the Plan  Year"  means  either  prior to or within the first
ninety days of the Plan Year.
     (x) "Restricted  Stock" means the common stock, $1.00 par value, of Pioneer
Hi-Bred International, Inc. which is issued or granted pursuant to the Plan.
     (y) "Shares" means the common stock, $1 par value, of the Company.

<PAGE>



     (z) "Stated Good Reason" means a written determination by a CIC Participant
that  he  reasonably   and  in  good  faith  cannot   continue  to  fulfill  the
responsibilities  for  which  he  was  employed.   This  determination  will  be
conclusively  presumed to be  reasonable  and in good faith if,  without the CIC
Participant's   express  written  consent,  the  Company  (a)  reduces  the  CIC
Participant's base salary or rate of compensation as in effect immediately prior
to the Change in Control, or as the same may have been increased thereafter, (b)
fails to continue any bonus plans in which the CIC  Participant  was entitled to
participate  immediately  prior to the Change in Control,  substantially  in the
form then in effect, (c) fails to continue in effect any benefit or compensation
plan in which the CIC  Participant  is  participating  immediately  prior to the
Change in Control  (or plans  providing  substantially  similar  benefits),  (d)
assigns  to  the  CIC  Participants  any  duties   inconsistent   with  the  CIC
Participant's duties, responsibilities or status immediately prior to the Change
in Control, or changes the CIC Participant's reporting responsibilities,  titles
or offices,  or (e) requires the CIC  Participant  to change the location of his
job or office,  so that the  Participant  will be based at a location  more than
thirty  (30) miles  distant by public  highway  from the  location of his job or
office immediately prior to the Change in Control.
     (aa)  "Subsidiary"  means a corporation in which the majority of the voting
securities  outstanding  at the time is owned  directly or indirectly by Pioneer
Hi-Bred International,  Inc. and/or by one or more of its other subsidiaries, or
a non-corporate entity in which a majority of the capital or profits interest is
owned directly or indirectly by Pioneer Hi-Bred  International,  Inc. and/or one
or more of its other subsidiaries.
     (ab)  "Termination  for Cause" means the termination of employment of a CIC
Participant as a direct result of an act or acts of  dishonesty,  constituting a
felony under the laws of the United States or the State of Iowa and resulting or
intended to result directly or indirectly in gain or personal  enrichment at the
expense of the Company. An act or acts of dishonesty  constituting a felony will
be  deemed  to  occur  only if the  act or  acts  constituting  the  felony  are
established  either by (a) the specific  admission of the  Participant  or (b) a
final noappealable judgment of a court of competent jurisdiction.

SECTION 3.  ADMINISTRATION

     3.1  Administration.  The Plan shall be administered by the Committee.  The
Committee  shall have  authority to make all  determinations  required under the
Plan,  to interpret  the Plan,  to decide  questions of facts  arising under the
Plan, to formulate rules and regulations  covering the operation of the Plan and
to make all other determinations necessary or desirable in the administration of
the  Plan.  The  decisions  of the  Committee  on any  questions  concerning  or
involving the  interpretation  or  administration of the Plan shall be final and
conclusive.

     3.2  Delegation of Authority.  The Committee may delegate to any officer of
the Company its duties under the Plan pursuant to such conditions or limitations
as the Committee may  establish,  except that only the Committee may  administer
the Plan for  Participants  who are  subject  to  Section  16 of the  Securities
Exchange Act of 1934.

SECTION 4.  ELIGIBILITY

     To be  eligible  to  participate  in the  Plan  an  individual  must  be on
full-time,  regular  status on the  United  States or  Canadian  payroll.  To be
eligible to receive grants, such employee must be eligible as of the last day of
the  Plan  Year and as of the  date of the  grant  except  as set  forth  below.
Employees  who meet the  following  conditions  are also  eligible  to receive a
grant:  1) eligible on the last day of the Plan Year,  2) before the date of the
grant employment  terminates because of normal  retirement,  death, or total and
permanent  disability,  or  employment  terminates  after  early  retirement  is
accepted and approved by the  Committee,  and 3) the employee is not  terminated
for cause as determined by the Committee  prior to the date of the grants.  This
eligibility  exception  does not mean that grants of stock will be  accelerated.
Additionally,  the  employee  must  be  in  one  of the Pay  Bands  a)  I - III

<PAGE>


(inclusive),  b) IV with  recommendation  of the  Corporate  Officer to whom the
employee's business unit reports and approval by the Operations Committee, or c)
(as an exception) with the approval of the Corporate Management Committee. Prior
to the Plan Year, the Committee may adjust which Pay Band an employee must be in
to be eligible. Other employees of the Company or its affiliates approved by the
Committee will also be eligible and entitled to grants including officers not on
the United States or Canadian payroll.

SECTION 5.  GRANT

     5.1 Nature of Goal. Grants will be based upon three-year EPS growth.

     5.2 EPS Multipliers.

     The EPS Multiplier is that multiplier as set forth below, or as approved by
the Committee Prior to the Plan Year, that corresponds to EPS Growth Percentage.

      EPS Growth Percentage             Multiplier*

               0%                          0.00
               1%                          0.08
               2%                          0.17
               3%                          0.25
               4%                          0.33
               5%                          0.42
               6%                          0.50
               7%                          0.58
               8%                          0.67
               9%                          0.75
              10%                          0.83
              11%                          0.92
              12%                          1.00
              13%                          1.00
              14%                          1.00
              15%                          1.25
              16%                          1.40
              17%                          1.55
              18%                          1.70
              19%                          1.85
              20%                          2.00
              21%                          2.05
              22%                          2.10
              23%                          2.15
              24%                          2.20
              25%                          2.25

        *Minimum  is 0% with no  maximum.  Interpolation  of actual  results  is
computed  between  table  points.  Beyond 25% each 1% increase in the EPS Growth
Percentage corresponds to an .05 increase in the multiplier.

     5.3 Pay Band.  Each  employee is assigned or  reassigned  to a Pay Band. An
appropriate  Pay Band for an employee is determined by  considering  job factors
such as: 1) impact, 2) complexity, 3) knowledge, skills and competencies, and 4)
experience.


<PAGE>



     5.4 Pay Band Target Percent.  The following table sets forth the targets as
a percent of Base Salary for each respective Pay Band:

                      Pay Band                  Target

                        CEO                        75%
                        I                          60%
                        II                     45-50%*
                        III                    25-40%*
                        IV                         10%

     *The exact Pay Band Target  Percent  will be  determined  prior to the Plan
Year depending upon market data.

     Such Pay Band Target  Percentage may be modified by the Committee  Prior to
the Plan Year. If a Key  Management  Employee  moves from 1 eligible Pay Band or
portion  thereof to another in a Plan Year the Pay Band Target  Percent  will be
adjusted pro rata for the portion of the year in each Pay Band.

     5.5 Grant. a) Shares of the Restricted Stock will be granted under the Plan
equal  in  value  to i) EPS  multiplier,  multiplied  by  the  Pay  Band  Target
Percentage  multiplied by Base Salary, or ii) such lesser value as the Committee
shall determine in its sole discretion.

     b)The shares to be granted will be determined as of the grant date, or such
other date approved by the Committee,  based on the Fair Market Value of a share
of Common  Stock the trading  day before the grant.  Such value shall be without
reference to any  restrictions  on transfer.  Such grants will be made following
the end of the Plan Year.

     c) The  calculation  in clause i) of Section  5.5(a),  for a Key Management
Employee who was  eligible at the end of the Plan Year but not  eligible  during
some  period of the Plan Year will be  reduced  pro rata for the  portion of the
Plan Year he was not eligible.

     5.6 Maximum.  In no event will the reward be in excess of a maximum set for
each Pay Band as approved by the  Committee  prior to the Plan Year but any such
reward is subject to the overriding  maximum reward described below. In no event
will the maximum value of a reward  (valued at the date of grant without  regard
to restrictions) to an individual  employee under this Plan exceed three million
dollars for a Plan Year.

SECTION 6.  COMMITTEE CERTIFICATION

     Before any grant is made the  Committee  must certify  that the  multiplier
level  was in fact  reached  and all  other  material  terms  of the  Plan  were
satisfied.

SECTION 7.  CHANGE IN CONTROL BENEFITS

     7.1  Benefits.  Notwithstanding  any other  provision of this Plan,  in the
event of the Involuntary  Termination of Employment of a CIC Participant  within
three (3) years following a Change in Control, the CIC Participant shall receive
a cash amount  equal to the Change in Control  benefits.  Such Change in Control
benefits  shall be paid in lieu of and not in addition to any other benefits for
the Plan Year under this Plan.


<PAGE>



     7.2  Amount.  The amount of the Change in Control  benefit  shall equal the
amount calculated in clause a(i) of Section 5.5 (with no reduction) prorated for
the portion of the Plan Year before  Involuntary  Termination of Employment of a
CIC  Participant  and subject to the maximum set forth in the second sentence of
Section 5.6. In addition, if the Involuntary  Termination of Employment is after
a Plan Year,  but prior to a grant in respect of that Plan Year,  in addition to
the  amount  paid for the Plan  Year in which  the  Involuntary  Termination  of
Employment  occurred,  the CIC participant  shall receive an amount equal to the
calculation  under clause a(i) of Section 5.5 (with no  reduction)  for the Plan
Year prior to the  Involuntary  Termination  subject to the maximum set forth in
the second sentence of Section 5.6.

     7.3 Amendment &  Termination.  No amendment or  termination  of the Plan, 1
year prior to or after a Change in Control,  will affect the payments under this
Section 7 for Involuntary Termination of Employment after the Change in Control.

SECTION 8.  STOCK SUBJECT TO THE PLAN

     8.1 Number.  The total number of Shares that may be granted  under the Plan
shall not exceed  1,750,000.  These Shares may consist,  in whole or in part, of
authorized but unissued  Shares or Shares  reacquired by the Company,  including
without  limitation,  Shares purchased in the open market,  and not reserved for
any other purpose.

     8.2 Reacquired  Shares. If, at any time, Shares issued pursuant to the Plan
shall have been  reacquired by the Company in connection  with the  restrictions
herein  imposed on such  shares,  such  reacquired  Shares  again  shall  become
available for issuance under the Plan at any time prior to its termination.

     8.3  Adjustment  in  Capitalization.  In the  event  of any  change  in the
outstanding  Shares of the Company by reason of a stock  dividend,  stock split,
recapitalization,  merger, consolidation,  combination, or exchange of shares or
other similar corporate change, the aggregate number and kind of Shares issuable
under  this  Plan  shall  be  appropriately  adjusted  by the  Committee,  whose
determination shall be conclusive.

SECTION 9. SHARES OF RESTRICTED STOCK

     9.1 Grant of Shares of  Restricted  Stock.  Awards of  Restricted  Stock to
Participants  shall be granted under a Restricted  Stock  Agreement  between the
Company and the  Participant  which shall provide that the shares subject to any
such award shall be subject to such forfeiture and other  conditions,  including
the  provisions of Section 9.6 hereof,  for such period of time as the Committee
shall designate.

     9.2 Transferability. Subject to Section 9.7 through 9.9 hereof, the
shares  of  Restricted   Stock  granted  to  a  Participant  may  not  be  sold,
transferred,  pledged,  assigned, or otherwise alienated or hypothecated as long
as the shares are subject to forfeiture  or other  conditions as provided in the
Plan, and as set forth in the Restricted Stock Agreement  pursuant to which such
shares were granted.

     9.3 Removal of Restrictions. Except as otherwise provided herein, or as may
be  required by  applicable  law,  shares of  Restricted  Stock  covered by each
Restricted Stock Agreement made under this Plan will become freely  transferable
by the Participant upon the expiration of a period of time following the date of
grant as specified in terms of the Restricted Stock Agreement.


<PAGE>


     9.4 Other  Restrictions.  The Company may impose such other restrictions on
any shares granted  pursuant to this Plan as it may deem  advisable,  including,
without limitation,  restrictions on the transfer until all amounts owing to the
Company are paid and any withholding  relating to the Restricted Stock have been
paid,  and  restrictions  required  by  the  federal  securities  laws,  by  the
requirements  of any stock exchange upon which such shares or shares of the same
class  are then  listed  and by any state  securities  laws  applicable  to such
shares.

     9.5 Legends and Escrow.  In addition to any other legends or  restrictions,
the Company  specifically  reserves  the right to place on each  certificate  or
account representing shares of Restricted Stock a legend as follows:

               "The sales or other  transfer of shares of stock  represented  by
        this  certificate  (account),  whether  voluntary,  involuntary,  or  by
        operation  of law,  is  subject  to the  restrictions  on  transfer  and
        forfeiture   conditions  (which  include  the  satisfaction  of  certain
        employment  service  requirements)  set  forth  in the  Pioneer  Hi-Bred
        International,  Inc. Restricted Stock Plan -- Performance-Based and in a
        Restricted  Stock  Agreement.  A copy of such plan and  agreement may be
        inspected at the offices of the Secretary of the Company."

        All shares of Restricted  Stock shall be held by the Committee in escrow
on behalf of the  Participant  awarded  such  shares,  together  with a Power of
Attorney executed by the Participant,  in form satisfactory to the Committee and
authorizing  the Company to transfer  such shares as provided in the  Restricted
Stock  Agreement,  until such time as all  restrictions  imposed on such  shares
pursuant to the Plan and the  Restricted  Stock  Agreement  have expired or been
earlier terminated.

     9.6 Termination of Employment.  In the event that,  prior to the removal of
restrictions  on shares of Restricted  Stock as  contemplated  by Section 9.3, a
Participant's  employment with the Company  terminates for any reason other than
normal  retirement,  death,  total and permanent  disability or early retirement
accepted and approved by the  Committee,  then any shares subject to time period
restrictions  or  forfeiture  conditions at the date of such  termination  shall
automatically be forfeited to the Company.  A Participant  shall not forfeit any
rights to Restricted Stock  previously  granted to him, solely because he or she
ceases to qualify as a Key Management Employee.

     9.7  Normal  Retirement,  Death or Total,  Permanent  Disability  and Early
Retirement. In the event that, prior to the removal of restrictions on shares of
Restricted Stock as contemplated by Section 9.3, a Participant's employment with
the  Company  terminates  because  of  normal  retirement,  death or  total  and
permanent  disability,  any uncompleted  portion of a time period restriction or
forfeiture  conditions,  as set  forth  in the  terms  of the  Restricted  Stock
Agreement,  shall be waived by the Company.  If early retirement is accepted and
approved by the Committee in its sole  discretion any  uncompleted  portion of a
time period  restriction or forfeiture  condition,  as set forth in the terms of
the Restricted Stock Agreement,  shall be waived.  The shares released from such
restrictions   pursuant  to  this  Section  9.7   thereafter   shall  be  freely
transferable by the Participant, subject to any applicable legal requirements.

     9.8 Change in Control.  Upon a Change in Control,  all  restrictions  shall
lapse on shares of Restricted Stock granted under this Plan.

     9.9 Waiver at the Committee's  Discretion.  Notwithstanding  the above, the
Committee also may waive all  restrictions on shares of Restricted  Stock at any
time,  in its sole  discretion.  The  shares  released  from  such  restrictions
pursuant to this  Section 9.9  thereafter  shall be freely  transferable  by the
Participant, subject to any applicable legal requirements.


<PAGE>


     9.10 Voting Rights. Participants shall have full voting rights with respect
to shares of Restricted Stock.

     9.11 Dividend  Rights.  Except as the  Committee  may otherwise  determine,
Participants  shall have full dividend rights with any such dividends being paid
currently. If all or part of a dividend is paid in shares of stock, the dividend
shares  shall be  subject to the same  restrictions  on  transferability  as the
shares of Restricted Stock that are the basis for the dividend.

     9.12 Security  Interest in Shares of Restricted  Stock.  In connection with
the execution of any Restricted Stock Agreement,  the Committee may require that
a  Participant  grants  to the  Company a  security  interest  in the  shares of
Restricted  Stock issued or granted  pursuant to this Plan to secure the payment
of any sums then owing or thereafter coming due to the Company, including income
tax  withholdings,  to the Company by such  Participant.  This security interest
shall  continue  until the shares of Restricted  Stock are no longer held by the
Committee in escrow on behalf of the Participant pursuant to Section 9.5 and are
no longer subject to restrictions pursuant to the Plan.

SECTION 10.  WITHHOLDING OF TAXES

     The Company may  require,  as a condition to any grant under the Plan or to
the release of any restrictions, security interest or escrow hereunder, that the
Participant  pay to the Company,  in cash, any federal,  state or local taxes of
any kind  required by law to be withheld  with respect to any grant,  vesting or
delivery of Restricted Stock. The Committee, in its sole discretion,  may permit
Participants  to pay such taxes a) through the  withholding of Restricted  Stock
otherwise  deliverable to such  Participant  in connection  with such vesting or
delivery or b) the delivery to the Company of Shares  otherwise  acquired by the
Participant.  The Restricted Stock withheld by the Company or Shares tendered to
the Company  for the  satisfaction  of tax  withholding  obligations  under this
section shall be valued in the same manner as used in computing the  withholding
taxes under applicable law. The Company,  to the extent permitted or required by
law,  shall have the right to deduct  from any  payment  of any kind  (including
salary or bonus)  otherwise  due to a  Participant  any federal,  state or local
taxes of any kind  required  by law to be  withheld  with  respect to any grant,
vesting or delivery  of  Restricted  Stock under the Plan,  or to retain or sell
without  notice a sufficient  number of the  Restricted  Stock  granted or to be
granted to such  Participant to cover any such taxes,  provided that the Company
shall not sell any such Restricted Stock if such sale would be considered a sale
by such Participant for purposes of Section 16 of the Exchange Act.

SECTION 11.  SHAREHOLDER APPROVAL

     This Plan will not be effective unless the shareholders approve the Plan by
a majority of the vote in a separate shareholder vote.

SECTION 12.  AMENDMENT AND TERMINATION

     12.1  Amendment.  Except  as set  forth in  Section  7.3,  this Plan may be
amended by the Board without  shareholder  approval except as otherwise required
by the law.  Any such  amendment  will not apply to the Plan Year in which  such
amendment was adopted or earlier Plan Years.

     12.2  Termination.  The Company reserves the right to terminate the Plan at
any time by action of the Board  except  as set forth in  Section  7.3.  After a
Change in Control any termination  will not apply to the Plan Year in which such
termination was adopted or any earlier Plan Year.


<PAGE>



     12.3 Existing Restrictions.  Neither amendment nor termination of this Plan
shall affect any shares previously issued or any restrictions  previously issued
or any restrictions previously imposed on such shares pursuant to this Plan.

SECTION 13.  PROVISIONS APPLICABLE SOLELY TO INSIDERS

Persons  subject to Section 16 of the 1934 Act with respect to securities of the
Company , may have to comply  with  additional  rules  imposed by the Company to
ensure compliance with Section 16.

SECTION 14 - MISCELLANEOUS

     14.1 No Contract of Employment.  Nothing in this Plan shall be construed as
a contract of  employment  between the Company and any  Participant.  Nothing in
this Plan shall be deemed to  constitute  a contract  for  services  between the
Company and a Participant,  and nothing contained in the Plan shall be deemed to
give a Participant any right to continue  furnishing  services to the Company or
the  Company any right to demand  such  services.  Nothing in this Plan shall be
construed  as an  elimination  of  the  right  of the  Company  to  discharge  a
Participant, with or without cause.

     14.2  Severability.  If any  provision  of this Plan is held to be illegal,
invalid, or unenforceable, such illegality, invalidity or unenforceability shall
not affect the remaining  provisions of this Plan, and such  provision  shall be
construed and enforced as if such illegal,  invalid, or unenforceable  provision
had never been inserted.

     14.3 Governing Law. This Plan shall be governed by the laws of the State of
Iowa  without   reference  to  the  principles  of  conflict  of  laws  therein.
Notwithstanding the foregoing,  this Plan shall be administered as to constitute
a plan of performance-based compensation under all applicable federal tax laws.

                                   PIONEER HI-BRED INTERNATIONAL, INC.



                                   By:/s/ Charles S. Johnson
                                   -------------------------
                                          Charles S. Johnson
                                          President and CEO


/s/ Jerry L. Chicoine
---------------------
    Jerry L. Chicoine
    Secretary


<PAGE>


                       PIONEER HI-BRED INTERNATIONAL, INC.
                 MANAGEMENT REWARD PROGRAM -- PERFORMANCE-BASED


ARTICLE 1 - ESTABLISHMENT OF THE PLAN

Section 1.1 - Establishment of the Plan

      The Company hereby  establishes the Pioneer Hi-Bred  International,  Inc.,
Management Reward Program -- Performance- Based (the "Plan").

Section 1.2 - Effective Date

      The effective date of the Plan is September 1, 1995.

Section 1.3 - Purpose

      The Plan is  designed  to focus  management  efforts on the  earnings  and
return on equity of the  company and to reward  results  achieved in relation to
those goals.

ARTICLE 2 - DEFINITIONS

Section 2.1 - Base Salary

      Base Salary means a  Participant's  base annual  salary as of August 31 of
the Plan Year without reduction for contributions or deferrals to various plans.

Section 2.2 - Board

      Board means the Board of Directors of Pioneer Hi-Bred International, Inc.

Section 2.3 - Change in Control

      Change in Control means (i) the acquisition, whether directly, indirectly,
beneficially  (within the meaning of Rule 13d-3 of the  Securities  and Exchange
Act of 1934,  as amended  (the "1934  Act")),  or of record,  of  securities  of
Pioneer Hi-Bred  International,  Inc. representing  twenty-five percent (25%) or
more in number of any class of its then  outstanding  voting  securities  by any
"person"  (within the meaning of Sections  13(d) and  14(d)(2) of the 1934 Act),
including  any  corporation  or group of associated  persons  acting in concert,
other than (A) the  Corporation  and/or (B) any  employee  pension  benefit plan
(within the meaning of Section 3(2) of the Employee  Retirement  Income Security
Act of 1974,  as amended)  of the  Corporation,  including  a trust  established
pursuant to any such plan, or (ii) the  nomination  and election of  twenty-five
percent  (25%) or more of the  members of the Board of the  Corporation  without
recommendation  of such Board.  The ownership of record of 25% or more in number
of any class of the then outstanding  voting  securities of the Corporation by a
person  engaged in the  business of acting as nominee for  unrelated  beneficial
owners shall not in and of itself be deemed to constitute a Change in Control.

Section 2.4 - CIC Participant

      "CIC Participant"  means an employee 1) who would have been eligible for a
reward in respect of the Plan Year prior to the Plan Year in which the Change in
Control  occurs  or 2) who but  for  his or her  termination,  would  have  been
eligible for a reward in respect of the Plan Year in which the Change in Control
occurred.


<PAGE>


Section 2.5 - Committee

      Committee means the  Compensation  Committee of the Board or any successor
committee.

Section 2.6 - Company

      Company means Pioneer Hi-Bred International, Inc., an Iowa Corporation and
any division or Subsidiary thereof.

Section 2.7 - Corporate Management Committee

      Corporate  Management Committee means the Company's committee of executive
officers selected by the chief executive officer or any successor committee.

Section 2.8 - Earnings Per Share (EPS)

      Earnings Per Share means the after tax  earnings per share of  outstanding
stock plus or minus  adjustments to remove the impact of unusual or nonrecurring
events.

Section 2.9 - EPS Growth Percentage

      EPS  Growth  Percentage  means  the  percentage  that  corresponds  to the
Earnings Per Share for the given Plan Year as shown on Attachment 1 or as may be
modified  prior to the Plan Year by the  Compensation  Committee.  Minimum is 0%
with no  maximum.  Interpolation  of actual  results is computed  between  table
points.  Points beyond 25% will be determined by the percentage the Earnings Per
Share  exceeds the  Earnings Per Share set forth in the 13% row for the previous
year.

Section 2.10 - EPS Multiplier

      EPS Multiplier means the multiplier as calculated in Section 4.2(a).

Section 2.11 - Involuntary Termination of Employment

      Involuntary  Termination  of  Employment  means  (a)  the  termination  of
employment of a CIC Participant by the Company other than Termination for Cause,
(b) the  resignation or retirement of a CIC  Participant for Stated Good Reason,
or (c) in the case of a CIC Participant who is in the full-time  employment of a
domestic Subsidiary,  either (I) the sale of a substantial portion of the assets
of the  Subsidiary  within the meaning of Section 280G of the  Internal  Revenue
Code of 1986, as amended, or (II) the acquisition by an unrelated third party of
ownership  of more  than  fifty  percent  (50%) of the then  outstanding  stock,
capital,  or  profits  interest  of the  Subsidiary.  The  Board,  in  its  sole
discretion,  shall determine whether the acquisition by an unrelated third party
of ownership of an interest in a foreign  subsidiary  constitutes an Involuntary
Termination of Employment.

Section 2.12 - Outstanding Stock

      Outstanding  Stock means the  weighted  average  daily  stock  outstanding
without giving effect to the dilutive impact of outstanding options.

Section 2.13 - Participants

      Participants means an employee who is eligible to participate in this Plan
under Article 3.


<PAGE>



Section 2.14 - Participant Pay Band
      Participant  Pay Band  means  that Pay Band for which the  Participant  is
categorized pursuant to Section 4.4.

Section 2.15 - Pay Band

      Pay Band  means job  evaluation  categories  I - VI.  The Pay Bands may be
further divided or consolidated as necessary.

Section 2.16 - Pay Band Target Percentage

      Pay Band Target  Percentage  means the Reward targets as a percent of Base
Salary for a Pay Band or portion thereof as set forth in Section 4.6.

Section 2.17 - Plan

      Plan means Pioneer Hi-Bred International,  Inc., Management Reward Program
-- Performance-Based, as amended from time to time.

Section 2.18 - Plan Year

      Plan Year  means the 12 month  period  beginning  September  1 and  ending
August 31.

Section 2.19 - Prior to the Plan Year

      Prior to the Plan Year means  either  prior to or within the first 90 days
of the Plan Year.

Section 2.20 - Return on Equity (ROE)

      Return on Equity  (ROE) means net income over ending  shareholders  equity
with adjustments to remove the impact of unusual or nonrecurring events.

Section 2.21 - Reward

      Reward means the reward under this Plan.

Section 2.22 - ROE Modifier

      ROE Modifier means the modifier as calculated in Section 4.2(b).

Section 2.23 - Stated Good Reason

      Stated Good Reason means a written determination by a CIC Participant that
he reasonably and in good faith cannot continue to fulfill the  responsibilities
for  which  he was  employed.  The  CIC  Participant's  determinations  will  be
conclusively  presumed to be  reasonable  and in good faith if,  without the CIC
Participant's   express  written  consent,  the  Company  (a)  reduces  the  CIC
Participant's base salary or rate of compensation as in effect immediately prior
to the Change in Control, or as the same may have been increased thereafter, (b)
fails to continue any bonus plans in which the CIC  Participant  was entitled to
participate  immediately  prior to the Change in Control,  substantially  in the
form then in effect, (c) fails to continue in effect any benefit or compensation
plan in which the CIC  Participant  is  participating  immediately  prior to the
Change in Control  (or plans  providing  substantially  similar  benefits),  (d)
assigns  to  the  CIC  Participants  any  duties   inconsistent   with  the  CIC
Participant's duties, responsibilities or status immediately prior to the Change

<PAGE>


in Control, or changes the CIC Participant's reporting responsibilities,  titles
or offices,  or (e) requires the CIC  Participant  to change the location of his
job or office, so that the CIC Participant will be based at a location more than
thirty  (30) miles  distant by public  highway  from the  location of his job or
office immediately prior to the Change in Control.

Section 2.24 - Subsidiary

      Subsidiary  means a  corporation  in  which  the  majority  of the  voting
securities  outstanding  at the time is owned  directly or indirectly by Pioneer
Hi-Bred International,  Inc. and/or by one or more of its other subsidiaries, or
a non-corporate entity in which a majority of the capital or profits interest is
owned directly or indirectly by Pioneer Hi-Bred  International,  Inc. and/or one
or more of its other subsidiaries.

Section 2.25 - Termination for Cause

      Termination  for Cause shall mean the  termination  of employment of a CIC
Participant as a direct result of an act or acts of  dishonesty,  constituting a
felony under the laws of the United States or the State of Iowa and resulting or
intended to result directly or indirectly in gain or personal  enrichment at the
expense of the Company. An act or acts of dishonesty  constituting a felony will
be  deemed  to  occur  only if the  act or  acts  constituting  the  felony  are
established  either by (a) the specific  admission of the  Participant  or (b) a
final nonappealable judgment of a court of competent jurisdiction.

ARTICLE 3 - ADMINISTRATION

Section 3.1 - Administration

      The Plan shall be administered by the Committee.  The Committee shall have
authority to make all  determinations  required under the Plan, to interpret the
Plan, to decide  questions of facts  arising under the Plan, to formulate  rules
and  regulations  covering  the  operation  of the Plan  and to make  all  other
determinations  necessary or desirable in the  administration  of the Plan.  The
decisions  of the  Committee  on  any  questions  concerning  or  involving  the
interpretation or administration of the Plan shall be final and conclusive.

Section 3.2 - Delegation of Authority

        The  Committee  may  delegate  to any  officer of the Company its duties
under the Plan pursuant to such  conditions or  limitations as the Committee may
establish,   except  that  only  the  Committee  may  administer  the  plan  for
Participants  who are subject to Section 16 of the  Securities  Exchange  Act of
1934.

ARTICLE 4 - ELIGIBILITY

Section 4.1 - Eligibility

      To be  eligible  to  participate  in the  Plan  an  individual  must be on
full-time,  regular  status on the  United  States or  Canadian  payroll.  To be
entitled to receive a reward  such  employee  must be on such  payroll as of the
last day of the Plan  year.  Additionally,  the  employee  must be in one of the
following Pay Bands:  a)I - IV  (inclusive),  b)V with approval of the corporate
officer to whom the  employee's  business unit  reports,  or c)(as an exception)
with the approval of the Corporate Management Committee.  Prior to the Plan Year
the  Committee  may adjust which pay band an employee must be in to be eligible.
Other employees of the Company or its affiliates  approved by the Committee will
also be eligible and entitled to Rewards  including  officers not on the U.S. or
Canadian payroll.


<PAGE>



Section 4.2 - Other Plans

      Participants  are not eligible for profit  sharing or any sales  incentive
program.  Employees  eligible for sales  incentive  programs are not eligible to
participate in the Plan.

ARTICLE 5 - REWARD

Section 5.1 - Nature of Goal

      Rewards will be based upon EPS growth.

Section 5.2 - Multipliers

      a) EPS  Multiplier.  The EPS  Multiplier  is that  multiplier as set forth
below, or as approved by the Committee Prior to the Plan Year, that  corresponds
to EPS Growth Percentage.

      EPS Growth Percentage              Multiplier*

               0%                          0.00
               1%                          0.08
               2%                          0.17
               3%                          0.25
               4%                          0.33
               5%                          0.42
               6%                          0.50
               7%                          0.58
               8%                          0.67
               9%                          0.75
              10%                          0.83
              11%                          0.92
              12%                          1.00
              13%                          1.00
              14%                          1.00
              15%                          1.25
              16%                          1.40
              17%                          1.55
              18%                          1.70
              19%                          1.85
              20%                          2.00
              21%                          2.05
              22%                          2.10
              23%                          2.15
              24%                          2.20
              25%                          2.25

      *Minimum  is 0%  with no  maximum.  Interpolation  of  actual  results  is
computed  between  table  points.  Beyond 25% each 1% increase in the EPS Growth
Percentage corresponds to an .05 increase in the multiplier.


<PAGE>



      b) ROE  Modifier.  ROE  Modifier  is that  modifier  as set  forth  below,
or as approved  by the  Committee  Prior to the Plan  Year,  that corresponds to
Return on Equity.

             ROE                               Modifier*

             16%**                               .80
             17%                                 .85
             18%                                 .90
             19%                                 .95
             20%                                1.00
             21%                                1.05
             22%                                1.10
             23%                                1.15
             24%***                             1.20

      *Minimum  is .80 with a  maximum  of 1.20. Interpolation of actual results
is computed between table points.

      **Less than or equal to

      ***Greater than or equal to

Section 5.3 - Participant Pay Band

      Each employee is assigned or reassigned  to a Pay Band. An appropriate Pay
Band for an  employee is  determined  by  considering  job  factors  such as: 1
impact,  2) complexity, 3) knowledge, skill and competencies, and 4) experience.

Section 5.4 - Pay Band Target Percent

      The following table sets forth the targets as a percent of Base Salary for
each respective Pay Band:

                      Pay Band                  Target

                        CEO                        62%
                        I                          47%
                        II                     32-37%*
                        III                    12-27%*
                        IV                      5-12%*
                        V                        2-4%*

      Such Pay Band Target  Percentage may be modified by the Committee Prior to
the Plan Year. If a Key  Management  Employee  moves from 1 eligible Pay Band or
portion  thereof to another in a Plan Year, the Pay Band Target  Percentage will
be adjusted pro rata for the portion of the year in each Pay Band.

      *The exact Pay Band Target  Percent will be  determined  prior to the Plan
Year depending upon market data.


<PAGE>



Section 5.5 - Reward

        a) The Reward  equals i) EPS  Multiplier,  multiplied  by ROE  Modifier,
multiplied by Pay Band Target Percentage, multiplied by Base Salary, or ii) such
lesser amount the Committee shall determine in its sole discretion.

        b) The  calculation  in  clause  i) of  Section  5.5(a), for an Eligible
Employee  who was eligible at the end of the Plan Year but not  eligible  during
some period of  the Plan  Year will be reduced  pro rata  for the portion of the
Plan Year he was not eligible.

Section 5.6 - Maximum Reward

      The Reward  received by a  Participant  will in no event exceed $3 million
for a Plan Year.

ARTICLE 6 - COMMITTEE CERTIFICATION

Section 6.1 - Committee Certification

      Before any Reward is paid,  the Committee must certify that the multiplier
and  modifier  levels were in fact reached and all other  material  terms of the
Plan were satisfied.

ARTICLE 7 - PAYMENT

Section 7.1 - Payment

      Participants  will be paid their Reward less all  applicable  withholdings
and deductions within 75 days following the Plan year.

ARTICLE 8 - CHANGE IN CONTROL BENEFITS

Section 8.1 - Benefits

      Notwithstanding  any other  provision  of this  Plan,  in the event of the
Involuntary  Termination  of  Employment of a CIC  Participant  within three (3)
years following a Change in Control, the CIC Participant shall receive Change in
Control  benefits.  Such Change in Control benefits shall be paid in lieu of and
not in addition to any other benefits for that Plan Year under this Plan.

Section 8.2 - Amount

      The  amount of the  Change  in  Control  benefit  shall  equal the  amount
calculated  in clause a(i) of Section 5.5 (with no  reduction)  prorated for the
portion of the Plan Year before Involuntary Termination of Employment of the CIC
Participant.

Section 8.3 - Amendment & Termination

      No  amendment  or  termination  of the Plan  one year  prior to or after a
Change in Control  will affect  payments  under this  Article 8 for  Involuntary
Termination of Employment after a Change in Control.


<PAGE>


ARTICLE 9 - SHAREHOLDER APPROVAL

Section 9.1 - Shareholder Approval

      This Plan will not be effective unless the  shareholders  approve the Plan
by a majority of the vote in a separate shareholder vote.

ARTICLE 10 - AMENDMENT AND TERMINATION OF THE PLAN

Section 10.1 - Amendment

      Except as set forth in  Section  8.3 the Plan may be  amended by the Board
without  shareholder  approval  except as  otherwise  required by law.  Any such
amendment will not apply to the Plan Year in which such amendment was adopted or
earlier Plan Years.

Section 10.2 - Termination

      The Company reserves the right to terminate the Plan at any time by action
of the Board;  except as set forth in Section 8.3. After a Change in Control any
termination  will not  apply to the Plan  Year in  which  such  termination  was
adopted or any earlier Plan Year.

ARTICLE 11 - MISCELLANEOUS

Section 11.1 - No Contract of Employment

      Nothing  in this Plan  shall be  construed  as a  contract  of  employment
between the Company and any Participant. Nothing in this Plan shall be deemed to
constitute  a contract  for services  between a Company and a  Participant,  and
nothing contained in the Plan shall be deemed to give a Participant any right to
continue  furnishing  services to the Company or the Company any right to demand
such services.  Nothing in this Plan shall be construed as an elimination of the
right of the Company to discharge a Participant, with or without cause.

Section 11.2 - Severability

      If any  provision  of  this  Plan  is  held  to be  illegal,  invalid,  or
unenforceable,  such illegality, invalidity or unenforceability shall not affect
the remaining provisions of this Plan, and such provision shall be construed and
enforced as if such illegal,  invalid, or unenforceable provision had never been
inserted.

Section 11.3 - Governing Law

      This  Plan  shall be  governed  by the laws of the  State of Iowa  without
reference to the  principles  of conflict of laws therein.  Notwithstanding  the
foregoing,  this  Plan  shall  be  administered  as  to  constitute  a  plan  of
performance-based compensation under all applicable federal tax laws.

                                   PIONEER HI-BRED INTERNATIONAL, INC.

                                    By:/s/ Charles S. Johnson
                                    -------------------------
                                           Charles S. Johnson
                                           President and CEO


/s/ Jerry L. Chicoine
---------------------
    Jerry L. Chicoine
    Secretary


<PAGE>



                                                 EXHIBIT 11

                                    PIONEER HI-BRED INTERNATIONAL, INC.

                                     COMPUTATION OF EARNINGS PER SHARE
                                  (In thousands, except per share amounts)
<TABLE>
<CAPTION>  
<S>                                   <C>           <C>            <C>           <C>            <C> 

                                                     Years Ended August 31,
                                      1996          1995           1994          1993           1992
Number of shares of common
   stock outstanding at
   beginning of the period.......     83,487        86,215        89,442         90,274        90,829

Weighted average number of
   shares of common stock
   issued during the period......         75           128            90            148            52

Weighted average number of
   shares of common stock
   purchased for the treasury
   during the period.............       (408)       (1,832)         (884)          (308)          (92)
                                    --------       -------       -------        -------       -------

Weighted average number of
   shares of common stock
   outstanding during the
   period........................     83,154        84,511        88,648         90,114        90,789
                                    --------       -------       -------        -------       -------

Income before cumulative
   effect of changes in
   accounting principles.........   $222,962      $182,590      $212,664       $137,453      $152,160
                                     -------       -------       -------        -------       -------

Income before cumulative
   effect of changes in
   accounting principles
   per common share..............   $   2.68      $   2.16      $   2.40       $   1.53      $   1.68
                                     -------       -------       -------        -------       -------

Net income.......................   $222,962      $182,590      $212,664       $120,484      $152,160
                                     -------       -------       -------        -------       -------

Earnings per common share........   $   2.68      $   2.16      $   2.40       $   1.34      $   1.68
                                     -------       -------       -------        -------       -------


<FN>

The common  stock  equivalents  have not  entered  into the net income per share
computations because they would not have a dilutive effect.
</FN>

</TABLE>

<PAGE>


The Company's Business

Pioneer Hi-Bred's  business is the broad application of the science of genetics.
Pioneer was  founded in 1926 to apply newly  discovered  genetic  techniques  to
hybridize corn.  Today, the Company develops,  produces,  and markets hybrids of
corn, sorghum, and sunflowers;  and varieties of soybeans,  alfalfa,  wheat, and
canola.

Hybrids,  crosses of two or more unrelated  inbred lines, can be reproduced only
by crossing the original  parent  lines.  Thus, a grower must  purchase new seed
each year to obtain the original  hybrid.  Varietal crops,  such as soybeans and
wheat, will reproduce  themselves with little or no genetic  variation.  Growers
can save  grain  from the  previous  crop for  planting.  Growers  are  becoming
increasingly  aware of the  advantages  of  purchasing  "new" seed  every  year,
although in times of cash-flow crisis, they may tend to forgo those advantages.

Pioneer maintains the ownership of and controls the use of inbreds and varieties
through  patents and the Plant Variety  Protection  Act.  Within the U.S.,  this
essentially  prohibits  other  parties  from selling  seed  produced  from those
inbreds and  varieties  until such  protection  expires,  usually well after the
useful life of the seed.  Outside of the U.S., the level of protection  afforded
varies  from  country  to  country  according  to  local  law and  international
agreement.  Pioneer  also  applies  for  patents on new  hybrids  moving  toward
commercialization.  The Company believes it is vital that products  developed by
its  research  programs  remain  proprietary.  They  must  remain so in order to
provide the economic return necessary to support continued  research and product
development, and to generate an adequate return to the Company's shareholders.


Sales by Region - 1996
(in millions)                 Corn        Soybeans     Other        Total

North America.............  $    908     $   160      $    89     $ 1,157
Europe....................  $    336     $     4      $    63     $   403
Latin America.............  $     84     $     -      $    13     $    97
Other Regions.............  $     49     $     -      $    15     $    64


The Company's  principal  products are hybrid seed corn and soybean seed,  which
have accounted for approximately 89 percent of total net sales and substantially
100 percent of operating  profits over the last five years.  These  products are
expected to maintain a dominant role in the Company's  results of operations for
the foreseeable  future.  Approximately 67 percent of total 1996 sales were made
within the U.S. and Canada (the North America  region) and 23 percent in Europe.
Our goal within  developing  nations is to aid the  development  of the existing
seed markets and establish businesses that can grow and prosper.

Two  significant  factors that determine the volume of seed sold and the related
profit are government policies and weather.  Government  policies affect,  among
other things,  crop acreage and commodity  prices.  Weather can affect commodity
prices,  product  performance,  the Company's  seed field  yields,  and planting
decisions  made by farmers.  Compared  to hybrid  seed,  sales and profits  from
non-hybrid  seed  are  more  heavily  dependent  on  commodity  prices  and  the
competition from  farmer-saved  seed. As a result,  the margins are narrower and
contributions are subject to year-to-year fluctuations.

In North  America,  the  majority  of  Pioneer  brand seed is  marketed  through
independent  sales  representatives,  most of whom  are also  farmers.  In areas
outside of the traditional  Corn Belt, seed products are often marketed  through
dealers  and  distributors  who  handle  other  agricultural  supplies.  Pioneer
products are marketed  outside North America through a network of  subsidiaries,
joint ventures, and independent producer-distributors.


<PAGE>



The hybrid  seed  industry is  characterized  by intense  competition.  In 1996,
Pioneer seed corn held an estimated market share of 44 percent in North America.
The next six competitors  held an estimated  combined market share of 27 percent
with the closest competitor holding  approximately 10 percent.  The remainder of
the market is divided  among more than 300  companies  selling  regionally.  The
Company's 1996  purchased  soybean seed market share is estimated at 17 percent,
highest in the industry.

Pioneer has a leading  market share  position in most  countries  outside  North
America in which it operates.  Significant markets in which the Company operates
include:  France,  Italy,  Germany,  Hungary,  Austria,  Mexico, and Brazil. The
Company's  market share within  these  countries  ranges form near 10 percent to
more than 60 percent.

Competition in the seed industry is based  primarily on product  performance and
price.  The  Company's  objective  is to  produce  products  which  consistently
out-perform the competition and so command a premium price. The Company has been
successful  competing on that basis and expects to continue to do so through its
ongoing  investment in research and product  development.  The future success of
the  Company  depends  heavily  on the  results  of these  research  activities.
Continued  improvement in the performance of the Company's products is necessary
to maintain profit margins and market share.

The  Company's  research  and product  development  activities  are  directed at
products with significant  market  potential.  Pioneer believes it possesses the
largest single  proprietary pool of germplasm in the world from which to develop
new hybrid and  varietal  seed  products.  The  majority of the  Company's  seed
research is done through classical plant breeding  techniques.  However, the use
of  biotechnology  is  expected  to have an impact on future  results,  both for
Pioneer and the seed industry at large.  Certain of our current products require
government approval before commercialization.  It is expected a larger number of
our future products will also require such government approval.

In the production of its commercial  seed,  the Company  generally  provides the
parent seed stock,  detasseling and roguing labor,  and certain other production
inputs.  The  balance  of the labor,  equipment,  and  inputs  are  supplied  by
independent  growers.  The Company believes the availability of growers,  parent
stock, and other inputs necessary to produce its commercial seed is adequate for
planned production levels.

Pioneer continues to pursue ISO 9000 certification and has 35 sites certified in
six  countries,  including 19 production  sites in the U.S.  Certification  with
these  standards  will allow us to move  product  more  easily  from  country to
country.

Pioneer brand  microbial  products  include  inoculants for  high-moisture  corn
silage, hay, and other forages, and direct-fed microbial products for livestock.
This  product  line is focused  on the  research  and  development  of  products
containing naturally occurring microorganisms.

The nutrition and industry  markets (NIM) group is the worldwide focal point for
addressing opportunities driven by the "end-use" markets. The primary mission of
the NIM group is to ensure  that  Pioneer is the premier  seed  supplier in this
end-use market segment.

At August 31, 1996, the Company employed approximately 4,700 people worldwide.

Because the seed business is highly seasonal, the Company's interim results will
not necessarily  indicate the results for the full year.  Substantially all seed
sales are made from late second  quarter  through  the end of the third  quarter
(February 1 through May 31) of the fiscal year. Typically,  the Company operates
at a loss during the first and fourth quarters.  Varying climatic conditions can
change the  earnings  pattern  between  quarters.  These  conditions  affect the
delivery of seed and can cause a shift in sales between quarters.


<PAGE>



SELECTED FINANCIAL DATA

<TABLE>
<CAPTION>

Consolidated Ten-Year Financial History

        Years Ended August 31,1996    1995     1994     1993     1992    1991     1990     1989    1988      1987
-----------------------------------------------------------------------------------------------------------------
       
(In millions, except per share and statistical amounts)
<S>                        <C>      <C>      <C>      <C>      <C>      <C>      <C>      <C>      <C>      <C>   

Summary Operations:
Net Sales..................$1,721   $1,532   $1,479   $1,343   $1,262   $1,125   $  964   $  867   $  759   $  710
                            =====    =====    =====    =====    =====    =====    =====    =====    =====    =====
Gross Profit...............$  858   $  760   $  759   $  700   $  640   $  549   $  442   $  391   $  389   $  349
                            =====    =====    =====    =====    =====    =====    =====    =====    =====    =====
Restructuring and Settlements       $   --   $   --   $   45   $ (54)   $   --   $   --   $   --   $   --   $   --
                                     =====    =====    =====    ====     =====    =====    =====    =====    =====
$........................--
Income From Continuing
  Operations...............$  223   $  183   $  213   $  137   $  152   $  104   $   73   $   82   $   84   $   64
                            =====    =====    =====    =====    =====    =====    =====    =====    =====    =====
Net Income.................$  223   $  183   $  213   $  120   $  152   $  104   $   73   $   98   $   65   $   54
                            =====    =====    =====    =====    =====    =====    =====    =====    =====    =====

Per Common Share Data:
Income From Continuing
  Operations...............$ 2.68   $ 2.16   $ 2.40   $ 1.53   $ 1.68   $ 1.15   $ 0.78   $ 0.86   $ 0.88   $ 0.67
Net Income.................$ 2.68   $ 2.16   $ 2.40   $ 1.34   $ 1.68   $ 1.15   $ 0.78   $ 1.03   $ 0.68   $ 0.56
Growth in Earnings Per
 Share*.................... 24.1%    (10.0)%   56.9%   (8.9)%    46.1%    47.4%   (9.3)%   (2.3)%    31.3%  (20.2)%
Dividends Declared.........$ 0.83   $ 0.71   $ 0.59   $ 0.50   $ 0.40   $ 0.39   $ 0.39   $ 0.36   $ 0.35   $ 0.26
Shareholders' Equity.......$12.36   $10.94   $10.22   $ 9.23   $ 8.86   $ 7.51   $ 7.00   $ 6.62   $ 6.04   $ 5.70

Balance Sheet Summary:
Current Assets.............$  784   $  770   $  742   $  717   $  703   $  606   $  538   $  474   $  450   $  465
Net Property & Other Assets   638      523      511      504      513      480      468      440      414      401
                           ------   -------  -------  -------  -------  -------  -------  -------  -------  ------
Total Assets...............$1,422   $1,293   $1,253   $1,221   $1,216   $1,086   $1,006   $  914   $  864   $  866
                            =====    =====    =====    =====    =====    =====    =====    =====    =====    =====

Current Liabilities........$  288   $  280   $  232   $  261   $  286   $  295   $  294   $  221   $  209   $  228
Long-Term Debt.............    25       18       66       68       74       67       19       17       28       33
Other Long-Term Liabilities             91       82       74       67       57       43       44       49       50
                                    ------   ------   ------   ------   ------   ------   ------   ------   ------
59
Total Liabilities..........$  404   $  380   $  372   $  396   $  417   $  405   $  357   $  287   $  287   $  320
                            =====    =====    =====    =====    =====    =====    =====    =====    =====    =====

Shareholders' Equity.......$1,018   $  913   $  881   $  825   $  799   $  681   $  649   $  627   $  577   $  546
                            =====    =====    =====    =====    =====    =====    =====    =====    =====    =====

Dividends Declared.........$   69   $   60   $   52   $   45   $   36   $   35   $   36   $   34   $   33   $   25
Average Shares Outstanding.  83.2     84.5     88.6     90.1     90.8     90.9     93.5     95.4     95.5     95.8

Other Statistics:
Return on Ending Equity*... 21.9%    20.0%    24.1%    16.7%    19.0%    15.3%    11.2%    13.1%    14.6%    11.7%
Return on Net Sales*....... 13.0%    12.0%    14.4%    10.2%    12.1%     9.3%     7.5%     9.4%    11.1%     9.0%
Return on Ending Assets*... 15.7%    14.2%    17.0%    11.2%    12.5%     9.6%     7.2%     9.0%     9.8%     7.4%
Gross Profit on Net Sales.. 49.9%    49.6%    51.3%    52.1%    50.7%    48.8%    45.8%    45.1%    51.2%    49.2%
Dividends Declared as a % of
     Net Income............ 30.9%    32.8%    24.6%    37.4%    23.9%    33.8%    49.7%    34.7%    50.9%    46.2%
Stock Price at August 31,..$55.13   $43.00   $31.25   $32.75   $26.50   $17.42   $13.25   $14.00   $11.75   $11.92
Market Capitalization at
  August 31, (in millions) $4,542   $3,590   $2,694   $2,929   $2,392   $1,579   $1,229   $1,326   $1,122   $1,142
Number of Employees........ 4,738    4,924    4,847    4,807    5,016    4,829    4,601    4,026    4,805    5,235
<FN>

*Based on income from continuing operations before cumulative effect of accounting
change
</FN>
</TABLE>


<PAGE>

<TABLE>
<CAPTION>

Consolidated Net Sales and Operating Income (Loss) by Product

          Years Ended August 31,    1996    %       1995     %     1994    %       1993    %     1992     %
-----------------------------------------------------------------------------------------------------------
(In millions, except per share amounts)
<S>                               <C>      <C>    <C>    <C>    <C>      <C>     <C>     <C>   <C>      <C>

NET SALES:
   Corn.........................  $1,377   80.0   $1,227   80.0 $ 1,185  80.1    $1,077  80.2  $1,013   80.3
   Soybeans.....................     164    9.5      145    9.5     128   8.7       116   8.6     109    8.6
   Other........................     180   10.5      160   10.5     166  11.2       150  11.2     140   11.1
                                   -----  -----    -----  -----  ------ -----    ------  ----   -----  -----
Total Net Sales.................  $1,721  100.0   $1,532  100.0 $ 1,479 100.0    $1,343 100.0  $1,262  100.0
                                   =====  =====    =====  =====  ====== =====     ===== =====   =====  =====

OPERATING INCOME (LOSS):
   Corn.........................  $  410   29.8   $  359   29.3 $   383  32.3    $  354  32.9  $  317   31.3
                                          =====           =====         =====            ====          =====
   Soybeans.....................      16    9.8        9    6.2       7   5.5         7   6.0       8    7.3
                                          =====           =====         =====            ====          =====
   Other........................      (3)  (1.6)     (15)  (9.4)    (21)(12.6)      (24)(16.0)    (30) (21.4)
                                          =====            ====         =====            =====         =====
   Restructuring and Settlements      --     --       --     --      45   3.0       (53) (3.9)     --     --
                                    ----  =====     ----   ====    ---- =====      -----  ====   ----- =====
Product Line Operating Income...  $  423   24.6   $  353   23.0 $   414  28.0    $  284  21.1  $  295   23.3
Indirect General and Administrative
   Expense......................     (76)  (4.4)     (73)  (4.7)    (68) (4.6)      (59) (4.4)    (52)  (4.1)
                                   -----  -----    -----  -----   ------ -----     ----- -----    ----- -----
----
Operating Income................  $  347   20.2   $  280   18.3 $   346  23.4    $  225  16.7  $  243   19.2
Financial Income (Expense)......       7    0.4       11    0.7       3   0.2        (6) (0.4)     (3)  (0.2)
                                   -----  -----    -----  -----  ------ -----    ------  ----   -----  -----
Income Before Items Shown Below.  $  354   20.6   $  291   19.0 $   349  23.6    $  219  16.3  $  240   19.0
Income Taxes....................    (127)  (7.4)    (106)  (6.9)   (134) (9.1)      (86) (6.4)    (87)  (6.9)
Minority Interest and Other.....      (4)  (0.2)      (2)  (0.1)     (2) (0.1)        4   0.3      (1)    --
                                   -----  -----    -----  -----  ------ ------     -----  ----  -----  -----  
Income Before Cumulative Effect of
   Accounting Change............  $  223   13.0   $  183   12.0 $   213  14.4    $  137  10.2  $  152   12.1
Cumulative Effect of Accounting
   Change, Net..................      --    --        --     --      --    --       (17) (1.2)     --     --
                                   -----  -----     -----  -----  ------ -----    ------  ----   -----  -----
NET INCOME......................  $  223   13.0   $  183   12.0 $   213  14.4    $  120   9.0  $  152   12.1
                                   =====  =====    =====  =====  ====== =====     =====  ====   =====  =====

Income Per Common Share:
   Income Before Cumulative Effect
     of Accounting Change.......  $ 2.68          $ 2.16        $  2.40          $ 1.53        $ 1.68
   Cumulative Effect Of Accounting
     Change, Net................      --              --             --            (.19)           --
                                   -----           -----         ------          ------         -----
   Net Income...................  $ 2.68          $ 2.16        $  2.40          $ 1.34        $ 1.68
                                   =====           =====         ======           =====         =====

Average Shares Outstanding......    83.2            84.5           88.6            90.1          90.8
</TABLE>


<PAGE>



MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF 
OPERATIONS

Year Ended August 31, 1996, Compared to the Year Ended August 31, 1995

Pioneer  once again  achieved  outstanding  financial  results,  posting  record
earnings in 1996. After-tax earnings in 1996 were $223 million, on sales of $1.7
billion.  After-tax  earnings in 1995  totaled  $183  million,  on sales of $1.5
billion.  Earnings per share were $2.68 in 1996, a 24 percent increase over 1995
earnings  of $2.16  per  share.  Return  on  Ending  Equity  (ROE) was above the
targeted level of 20 percent for the third  consecutive  year. At the same time,
we continued to increase our investment in research and product development.

Current year sales and earnings were positively impacted by strong corn sales in
North America,  Europe,  Latin America,  and Asia.  Higher sales of soybeans and
other products also contributed to the improvement in earnings.

An  estimated  11 percent  increase in corn  acreage was the primary  driver for
higher 1996 sales and operating income in North America.  Corn acreage rose over
1995  levels as a result of  changes in  government  programs  and  higher  corn
commodity  prices.  An  increase  in the  average  per-unit  sales  price of the
Company's  seed corn sold in North America also  positively  impacted 1996 sales
revenue  and  operating  income.  Higher seed costs in North  America  partially
offset this improvement.

Operations  outside North America also generated  good earnings  growth in 1996.
Operating income in Europe improved as several countries experienced  increases,
either  individually or in  combination,  in the three primary  drivers:  market
size,  market share,  and sales price.  Latin American and Asian operations also
continued  to grow,  providing  additional  operating  income  over 1995  levels
largely by capturing the benefits of larger markets.

North American soybean  operations had record results in 1996.  Higher sales and
operating  income from a year earlier  resulted from  increased  market size. In
addition,  wheat and sorghum  operations also positively  impacted  current year
operating income.

Management is  optimistic  that 1997 will be another good year.  North  American
corn  acreage is expected to be similar to or slightly  higher than 1996 levels.
Higher  commodity  costs  related to the 1996 crop will push  per-unit seed corn
cost of sales  higher in 1997.  However,  the  average  seed corn sales price is
expected to increase,  which should keep  overall  margins  similar to or better
than 1996  levels.  While  results in regions  outside  North  America  are more
difficult  to  predict,  management  believes  that the Company is on target for
future growth in these regions and will build on the record results of 1996.

As we  look  forward,  all  indications  point  to  continued  strong  financial
performance.  As always,  uncertainties  exist that could  affect the  Company's
expectations,   and   fluctuations  in  expected  results  are  likely  as  more
information  becomes  available.  Some of the important factors that could cause
actual results to vary significantly from our expectations include weather, seed
field yields, government  programs/approvals,  commodity prices, changes in corn
acreage,   intellectual  property  positions,   product  performance,   customer
preferences, currency fluctuations, and costs.


Hybrid Seed Corn

In 1996, seed corn operating  income improved $51 million,  or 14 percent,  over
last year.  Operations  within  North  America  account  for $20  million of the
increase. European operations improved $25 million over 1995, with Latin America
and Asia accounting for virtually all of the remaining improvement.


<PAGE>

<TABLE>
<CAPTION>

Corn Net Sales and Product Line Operating Income

                                         Increase                               Increase
                       1996             (Decrease)             1995            (Decrease)            1994
---------------------------------------------------------------------------------------------------------
(In millions)
<S>                   <C>           <C>          <C>          <C>         <C>         <C>         <C>

NET SALES:
   North America....  $   908       $    100     12.4%        $   808     $   (38)     (4.5)%     $   846
   Europe...........      336             31     10.2%            305          84      38.0%          221
   Latin America....       84             18     27.3%             66          10      17.9%           56
   Other regions....       49              1      2.1%             48         (14)    (22.6)%          62
                       ------        -------                   ------       -----                  ------
Total net sales.....  $ 1,377       $    150     12.2%        $ 1,227     $    42       3.5%      $ 1,185
                       ======        =======     =====         ======      ======     ======       ======

OPERATING INCOME:
   North America....  $   276       $     20      7.8%        $   256     $   (21)     (7.6)%     $   277
   Europe...........      100             25     33.3%             75           6       8.7%           69
   Latin America....       21              3     16.7%             18          (1)     (5.3)%          19
   Other regions....       13              3     30.0%             10          (8)    (44.4)%          18
                       ------        -------                   ------       -----                  ------
Total operating income$   410       $     51     14.2%        $   359     $   (24)     (6.3)%      $  383
                       =======       =======    ======         ======      ======     ======       ====== 

UNIT SALES:
 (80,000-kernel units)
   North America....     12.1            1.2     11.4%           10.9        (0.9)     (7.6)%        11.8
   Europe...........      2.9            0.2      7.1%            2.7         0.5      23.1%          2.2
   Latin America....      1.3            0.4     30.5%            0.9          --       3.5%          0.9
   Other regions....      1.1            0.1     14.7%            1.0          --      (5.9)%         1.0
                       ------        -------                   ------       -----                  ------
Total unit sales....     17.4            1.9     12.0%           15.5        (0.4)     (2.6)%        15.9
                       ======        =======     =====         ======       ======    =======      ======

ACRES:
   North America....     82.7            8.5     11.4%           74.2        (7.8)     (9.5)%        82.0
                       ======        =======     =====         ======       ======    =======      ======
</TABLE>

Higher seed corn unit sales were the primary  factor  contributing  to the North
American improvement, principally the result of an increase in market size. Corn
acreage in 1996 increased approximately 11 percent over the prior year. In 1995,
government  programs  reduced  the number of corn  acres  planted.  In 1996,  no
government  restrictions and higher commodity prices  encouraged the planting of
more corn acres. Although overall corn acreage rose in North America,  extremely
wet field conditions in the Ohio River Valley region  prohibited corn acres from
reaching our customers' original planting intentions. Some were forced to switch
to soybeans or other  crops,  which  reduced  our margin  opportunities  in that
region.

In North America,  current year seed corn unit sales increased approximately 1.2
million  units,  or  11  percent,  over  the  previous  year,  the  result  of a
world-class Pioneer sales and supply organization  meeting the changing needs of
customers.  Sales of two key hybrids  accounted for  approximately 28 percent of
the Company's 1996 and 1995 North American seed corn hybrid unit sales.

North American  operating income was also positively  affected by an approximate
one percent increase in the average seed corn selling price per unit. A shift by
customers to  higher-priced,  better-performing  premium hybrids was responsible
for the increase.  The 1996 list price for all hybrids  remained  unchanged from
1995.


<PAGE>



Higher corn seeding rates and replant units lead  management to believe that the
Company's 1996 seed corn market share will be approximately 44 percent, a slight
decrease from the previous year. Market share declines occurred in some areas of
the Northern Corn Belt after disappointing  yields in that region in 1995. Those
were  partially  offset by market  share gains in other areas of North  America.
Management  is  confident  that the new  hybrids  introduced  in 1996 and  those
planned for 1997 will help regain market share.

Higher seed costs also impacted current year results. The smaller crop harvested
in 1995  compared  to 1994 and higher  commodity  costs  increased  the  average
per-unit cost of sales approximately  $1.00.  Increased provisions for inventory
reserves also impacted  current year results.  Provisions in 1996 were $2.22 per
unit, compared to $1.31 per unit in 1995. The increase in 1996 was the result of
reserving  inventory for a few particular hybrids and the higher production cost
of the 1995 seed crop.

Operations in the Company's European region (Europe, CIS, Turkey, Australia, and
Japan) and Latin America also played a significant  role in the increase in seed
corn operating income.

Record unit sales of corn grain hybrids across all of Southern Europe  accounted
for  virtually  the  entire  increase  in  European  operating  income  in 1996.
Increased  market size and market share in Spain and increased  market share and
price in Italy and Greece  were the  significant  factors  contributing  to this
improvement.

Latin American  operations  improved  principally the result of increased market
size in Argentina due to a strong commodity price within the country.

Worldwide  research  and  product  development  expenses  for corn  totaled  $90
million,  a three  percent  increase  over 1995,  as the Company  continued  its
emphasis on developing improved products for customers.  The increase was due to
the expansion of biotechnology projects, research collaborations,  and trait and
technology development.

For 1996,  Pioneer  research  efforts created 24 new corn hybrids for release to
customers  in North  America.  There are also 47 hybrids  currently in the later
stages of testing,  which have average  yields  greater than the current  leader
package released in 1996.  Pioneer is bringing new products to the market faster
than before, with the goal to always provide greater benefit to our customers.

Worldwide  fixed  selling and  administrative  expenses for corn  increased  $16
million,  or nine  percent,  from  1995  levels.  The major  components  of this
increase  were a greater  emphasis on the efforts of our  nutrition and industry
markets (NIM) group and higher  incentive  compensation  costs.  Excluding these
items,  fixed  selling and  administrative  expenses  increased one percent over
1995. Variable selling costs (commissions and shipping costs) as a percentage of
sales were comparable between the years.


Soybean Seed

The Company's second largest product in terms of revenue and operating income is
soybean  seed.  Operations  in North  America  account for  virtually all of the
worldwide  soybean seed operating  income.  Growth of this product line over the
last several  years  continues,  as evidenced by the $5 million,  or 44 percent,
increase in North American operating income over a year ago.


<PAGE>


North American Soybean Market Share
                                        1996          1995          1994
                                     -----------------------------------

                                       17.2%         17.5%         16.4%


North American Soybean Acreage
(in millions)                           1996          1995          1994
                                     -----------------------------------

                                        66.4          64.6          63.8


North American Soybean Unit Sales
(in millions)                           1996          1995          1994
                                     -----------------------------------

                                      11.338        10.961         9.396


Unit sales in North America  increased  three percent,  to a record 11.3 million
units, the result of increased  acreage.  Current year list prices increased the
average per-unit sales price, however, higher per-unit cost of sales, the result
of higher commodity costs, offset most of the sales price improvement.

Twenty-one  new  soybean  varieties  were  introduced  in  1996.  Five of  these
varieties  were resistant to the herbicide  glyphosate -- the first  large-scale
release of soybean  varieties  developed by using a combination of gene transfer
technology and traditional  plant  breeding.  These new releases are evidence of
the Company's  goal to provide  higher-yielding  and more  valuable  products to
customers.


Other Products

Other  products  operating  results for 1996 improved $12 million over the prior
year,  resulting  from the  improvement  of several  products.  Increased  North
American wheat acreage and increased  North American  sorghum  acreage and price
contributed to the current year improvement.

<TABLE>
<CAPTION>

Other Products Net Sales and Combined Product Line Operating (Loss)

                                          Increase                             Increase
                         1996            (Decrease)              1995         (Decrease)               1994
-----------------------------------------------------------------------------------------------------------
(In millions)
<S>                   <C>           <C>          <C>          <C>         <C>         <C>          <C>

NET SALES:
Alfalfa.............  $    32       $     --       --         $    32     $    --       --         $     32
Sorghum.............       31              5     19.2%             26           3      13.0%             23
Wheat...............       25              7     38.9%             18          --       --               18
Sunflower...........       22              3     15.8%             19           3      18.8%             16
Microbial products..       28              1      3.7%             27           3      12.5%             24
Developing products.       42              4     10.5%             38         (15)    (28.3)%            53
                       ------        -------                   ------      ------                   -------
Total net sales.....  $   180       $     20     12.5%        $   160     $    (6)     (3.6)%      $    166
                       ======        =======    ======         ======      ======     =======       =======

Total combined
  operating (loss)..  $    (3)      $     12                  $   (15)    $     6                  $    (21)
                       ======        =======                   ======      ======                   =======
</TABLE>


<PAGE>


While  these  products  as a whole  operate at a loss,  they  provide  the sales
organization  a  complete  lineup  of seed  products  to meet  the  needs of our
customers.  As such,  they support and  contribute to the sales of the Company's
two major products,  seed corn and soybean seed. In addition,  the prospects for
some of these product lines to generate  greater  levels of operating  profit in
the near-term are promising.


Corporate and Other Items

Indirect  general and  administrative  expenses  increased  $3 million,  or four
percent,  in 1996. Higher incentive  compensation costs were partially offset by
decreases  in  several  expense  categories  resulting  from  active  fixed cost
management.

Translation  gains in Mexico recorded in 1995 not matched by the same or similar
items in the current year account for virtually all of the $4 million  change in
net financial income.

The  effective  tax rate of 36 percent for 1996 was substantially unchanged from
the 36.5  percent effective tax rate for 1995.

The Company will be more affected by new patents,  patent positions,  and patent
lawsuits in the future than it has been in the past. However, this is an area in
which Pioneer has become  increasingly  active through its research,  patenting,
alliance,  and monitoring  activities.  Pioneer believes that its current patent
positions, technologies,  germplasm, and sales force place the Company in a good
position  to  freely  develop  and  commercialize  the  products  which  will be
necessary to effectively compete in the market place.


Year Ended August 31, 1995, Compared to the Year Ended August 31, 1994

Hybrid Seed Corn

Planted corn acreage had a significant  impact on 1995 operating income in North
America. Acreage planted to corn decreased ten percent from 1994. A major factor
contributing  to the  acreage  decrease  was a  change  in the  U.S.  government
set-aside  program which required  farmers  participating in the 1995 feed grain
program to keep their  corn  acres at 92.5  percent or less of their  historical
corn acreage base, down from 100 percent in 1994.

In  addition,  high cotton  prices  induced  some farmers in the South to switch
acreage to cotton while wet conditions in the Corn Belt forced affected  farmers
to switch  acreage from corn to other crops such as soybeans.  Others were never
able to plant a crop. As a result, the Company sold approximately  900,000 fewer
units in 1995.

Seed corn pricing was also a major factor in 1995 financial results. The average
per-unit  sales  price  increased  three  percent due to an increase in the list
price of key hybrids and a higher-priced  sales mix. The higher-priced sales mix
occurred   as   customers    shifted   their    purchases   to    higher-priced,
better-performing hybrids, which are more profitable to growers and to Pioneer.

The Company's 1995 seed corn market share  approximated  45 percent - comparable
to 1994.  Maintaining market share was a challenge in a year when high levels of
seed inventory throughout the industry led to aggressive competition.  Our sales
and supply  management  groups were able to use the  flexibility  of our product
lineup to  respond  to the  changing  needs of  customers,  providing  them with
appropriate  products  when and where  they were  needed as  growing  conditions
changed.


<PAGE>



Higher  seed corn  yields  from the 1994 crop also  provided  positive  results,
reducing  the  average  per  unit  cost of seed  corn by $.80 per  unit.  Higher
operational fixed costs and provisions for inventory losses offset $7 million of
the improvements  gained in production costs.  Provisions for inventory reserves
totaled $1.31 per unit in 1995 compared to $.93 per unit in 1994.

Research  expenses  for corn in  North  America  increased  $11  million,  or 18
percent, from 1994 levels.  Planned growth in winter nursery costs and expansion
of biotechnology projects were the main factors contributing to this increase.

North American fixed selling and administrative expenses for seed corn decreased
$4 million,  or five percent,  from 1994 levels, the result of lower performance
incentive costs.  Variable  selling costs  (commissions and shipping costs) as a
percentage of sales in North America  increased  from 1994 because of additional
expenses  incurred  shipping  product to  customers  who  switched  seeds due to
weather related problems.

The Company's  European region showed an increase in operating income from 1994.
Approximately  $11 million of this change was the result of the weakening of the
U.S. dollar against  certain  European  currencies.  On a constant dollar basis,
1995 European  operations  provided a slight  decrease in operating  income from
1994.

Italian  operations  posted gains in operating  income over 1994,  the result of
lower  production  costs and fewer  inventory  writedowns.  An  increase  in the
average unit sales price, an increase in market size, and market share gain over
1994 also contributed to the improvement.

In 1994,  the Company  acquired the remaining 65 percent  interest in the French
entity,  which handled  distribution  and marketing of PioneerAE brand products.
Increased sales and expenses were reported  because the subsidiary was reflected
in the 1995  financials  on a  consolidated  basis for the first time.  Overall,
consolidated  country  operating  income for France  decreased due to fewer unit
sales.

Operating  income in Hungary and Germany each  decreased as unit sales  declined
and inventory writedowns increased.

Mexico's  operating  income  decreased  due  largely to the  devaluation  of the
Mexican peso.  Also,  nearly 35 percent fewer acres were planted to seed corn in
Northeast and Northwest  regions  because of drought,  subsidy  reductions,  and
NAFTA quotas. These factors reduced unit sales 25 percent.

In Asia seed corn operating income in 1995 improved from 1994 levels.  Increased
market  size and  market  share in the  Philippines,  increased  market  size in
Indonesia, and cost savings contributed to the improvement in this region.


Soybean Seed

In 1995, North American operations  accounted for virtually all of the worldwide
soybean seed operating  income.  North American unit sales  increased 17 percent
from 1994, a result of market  share gains and  increased  acreage.  A continued
recognition of the value  associated  with Pioneer brand  soybeans  provided for
market share gains, as customers  understood that planting Pioneer soybean seed,
much like Pioneer seed corn, provides economic value.

North  American  soybean  acreage  increased as poor weather  conditions  forced
customers  who  planned  to plant  corn to switch to  soybeans.  Higher  overall
acreage and  increased  market  share  contributed  $6 million more to operating
income than in 1994.


<PAGE>



The average sales price of soybean seed  decreased  approximately  three percent
from 1994 levels, the result of bulk sales and early payment discounts. However,
contribution  per unit  remained  the same  because of lower cost of sales,  the
result of lower commodity costs.

Increased  investments in research and additional  fixed selling and general and
administrative expenses reduced operating income $4 million from 1994.

Other Products

Operating  results for other products  increased from those recorded a year ago.
After allocation of fixed costs,  these products as a whole were not profitable,
however,  they provide value beyond the financial  bottom line.  These  products
provide  the  sales  organization  a full line of seed  products,  significantly
aiding in the sale of higher margin products.

Corporate Items

Indirect  general and  administrative  expenses  increased $5 million in 1995, a
seven  percent  increase over 1994.  The major  components of this increase were
personnel costs and increased charitable contributions.

Net interest income for 1995 increased $2 million compared to a year ago because
of higher  interest  rates  earned on current  year  investments  and  decreased
interest expense on lower levels of external borrowing.

Net exchange gain increased $6 million from 1994 levels.  The  strengthening  of
certain  European  currencies  against the U.S. dollar and translation  gains in
Mexico accounted for a majority of the improvement.

A  reduction  in taxes on foreign earnings reduced the 1995  effective  tax rate
to 36.5  percent, compared to 38.5 percent in 1994.

Restructuring and Settlements

On July 13, 1994,  the U.S.  Circuit  Court of Appeals  affirmed a prior court's
decision  in the  Company's  lawsuit  against  Holden  Foundation  Seeds,  Inc.,
awarding  Pioneer  damages  for  lost  profits  from  the   misappropriation  of
germplasm. In August, the Company received the settlement plus interest totaling
$52 million. The Company also incurred $7 million of restructuring charges.

Liquidity and Capital Resources

Due to the  seasonal  nature of the  agricultural  seed  business,  the  Company
generates most of its cash from operations  during the second and third quarters
of the  fiscal  year.  Cash  generated  during  this  time  is  used  to pay the
commercial  paper  borrowings  and  accounts  payable,  which are the  Company's
primary  sources of credit  during the first and fourth  quarters  of the fiscal
year.  Any  excess  funds  available  are  invested,   primarily  in  short-term
commercial paper.

Historically, the Company has financed growth through earnings. Cash provided by
operating activities was $389 million in 1996, compared to $140 million and $331
million in 1995 and 1994, respectively. Collections on increased sales and lower
inventory  levels were largely  responsible for the high levels of cash provided
by operating  activities  for 1996.  Higher  inventory  levels and a decrease in
accounts  payable  and  accrued  expenses  contributed  to the  decrease in cash
provided by operating  activities  during 1995.  Cash flow in 1994 was favorably
impacted by the settlement and collection of damages on the Holden suit.


<PAGE>



Most of the Company's financing is done through the issuance of commercial paper
in the U.S.,  backed by  revolving  and seasonal  lines of credit.  In addition,
foreign  lines of credit  and direct  borrowing  agreements  are relied  upon to
support overseas  financing needs.  Short-term debt at August 31, 1996,  totaled
$13 million,  a $45 million  decrease  from 1995 and $1 million lower than 1994.
Increased  sales in 1996 and the collection of damages on the Holden suit during
August of 1994 allowed for lower levels of borrowing  during those  periods.  In
1996,  short-term  borrowings  peaked at $238 million  compared to $217 and $164
million in 1995 and 1994, respectively.

At August 31, 1995,  the Company had a $100  million  private  medium-term  note
program of which $50 million  was  available.  The medium  term note  matured in
February, 1996.

In 1996, short-term domestic investments peaked at $234 million compared to $257
million and $326 million in 1995 and 1994, respectively.  Short-term investments
are made through a limited number of reputable  institutions after evaluation of
investment procedures and credit quality.  Pioneer invests in only high-quality,
short-term  securities,  primarily commercial paper.  Individual securities must
meet credit  quality  standards,  and the  portfolios  are  monitored  to ensure
diversification among issuers.


Fiscal 1996 and 1997 Available Domestic Lines of Credit
(in millions)             1st Qtr       2nd Qtr       3rd Qtr        4th Qtr
                          --------------------------------------------------

Revolving                 $ 200         $ 200         $  200         $ 200
Seasonal                    100           100              -             -
                           ----          ----          -----          ----
Total                     $ 300         $ 300         $  200         $ 200
                           ====          ====          =====          ====


The  Company  believes  the  domestic  lines  of  credit  available  in 1997 are
sufficient to meet domestic borrowing needs. Revolving line of credit agreements
expire August,  2001. The Company also has a seasonal  revolving credit facility
to meet peak borrowing needs which expires August, 1997.

At year end, cash and cash equivalents  totaled $99 million, up from $84 million
at August 31,  1995.  It is the  Company's  policy to  repatriate  excess  funds
outside the U.S. not required for operating capital or to fund asset purchases.

Capital expenditures,  including business and technology investments,  were $164
million in 1996  compared  to $86  million in 1995 and $79  million in 1994.  In
1996, total  expenditures  were higher,  principally due to expanded  production
capacity and technology acquisitions. Capital expenditures for 1997 are expected
to approximate $125 million and are expected to be funded through earnings.

Dividends paid in July of 1996  increased to $.23 per share,  up 15 percent from
the $.20 per share dividend paid the prior four quarters. The Company's dividend
policy is to  annually  pay out 40 percent  of a  four-year  rolling  average of
earnings.

Annual Dividends Paid
(in millions)              1994       1995       1996
                          ---------------------------

                          $  52     $   60     $   69

During 1996, 1.5 million shares of the Company's stock were repurchased  under a
Board authorized  repurchase plan at a total cost of $62 million.  At August 31,
1996,  authorized  shares  remaining to be purchased  under the plan totaled 2.5
million.


<PAGE>



Effects of Inflation

Inflation typically is not a major factor in the Company's operations.  The cost
of seed products is largely influenced by seed field yields and commodity prices
which are not impacted by inflation. Costs normally impacted by inflation-wages,
transportation, and energy-are a relatively small part of the total operations.

                    APPENDIX TO ANNUAL REPORT TO SHAREHOLDERS

The table titled "Sales by Region - 1996"  appears in The Company's  Business of
the Annual Report to Shareholders in the form of a bar graph.

The table titled "North American Soybean Market Share" appears in the Management
Discussion  and Analysis of the Annual Report to  Shareholders  in the form of a
bar graph

The table titled "North  American  Soybean  Average"  appears in the  Management
Discussion  and Analysis of the Annual Report to  Shareholders  in the form of a
bar graph

The table titled "North  American  Soybean Unit Sales" appears in the Management
Discussion  and Analysis of the Annual Report to  Shareholders  in the form of a
bar graph

The table  titled  "Fiscal  1996 and 1997  Available  Domestic  Lines of Credit"
appears in the  Management  Discussion  and  Analysis  of the  Annual  Report to
Shareholders in the form of a bar graph

The table titled "Annual  Dividends  Paid" appears in the Management  Discussion
and Analysis of the Annual Report to Shareholders in the form of a bar graph


<PAGE>


Independent Auditors' Report

To the Shareholders
Pioneer Hi-Bred International, Inc.:


We have audited the accompanying  consolidated balance sheets of Pioneer Hi-Bred
International,  Inc. and  subsidiaries  as of August 31, 1996 and 1995,  and the
related consolidated statements of income,  shareholders' equity, and cash flows
for each of the years in the  three-year  period ended  August 31,  1996.  These
consolidated  financial  statements  are  the  responsibility  of the  Company's
management.  Our  responsibility is to express an opinion on these  consolidated
financial statements based on our audits.

We  conducted  our  audits  in  accordance  with  generally   accepted  auditing
standards.  Those standards require that we plan and perform the audit to obtain
reasonable assurance about whether the financial statements are free of material
misstatement.  An audit includes examining, on a test basis, evidence supporting
the amounts and disclosures in the financial statements.  An audit also includes
assessing the  accounting  principles  used and  significant  estimates  made by
management,  as well as evaluating the overall financial statement presentation.
We believe that our audits provide a reasonable basis for our opinion.

In our opinion, the consolidated  financial statements referred to above present
fairly,  in all material  respects,  the financial  position of Pioneer  Hi-Bred
International,  Inc. and  subsidiaries  as of August 31, 1996 and 1995,  and the
results  of their  operations  and their cash flows for each of the years in the
three-year  period ended August 31, 1996, in conformity with generally  accepted
accounting principles.

KPMG Peat Marwick LLP


Des Moines, Iowa
October 4, 1996


<PAGE>

<TABLE>
<CAPTION>

Consolidated Statements of Income

                                Years Ended August 31,       1996              1995              1994
--------------------------------------------------------------------------------------------------------------------
(In millions, except per share amounts)
<S>                                                       <C>               <C>               <C>

Net sales.............................................    $ 1,721           $ 1,532           $ 1,479
                                                           ------            ------            ------

Operating costs and expenses:
    Cost of goods sold................................    $   727           $   642           $   606
    Research and product development..................        136               130               114
    Selling...........................................        382               354               335
    General and administrative........................        129               126               123
    Restructuring and settlements.....................         --                --               (45)
                                                           ------            ------            ------
                                                          $ 1,374           $ 1,252           $ 1,133
                                                           ------            ------            ------

    Operating income..................................    $   347           $   280           $   346

Investment income.....................................         22                23                19
Interest expense......................................        (11)              (13)              (11)
Net exchange gain (loss)..............................         (4)                1                (5)
                                                           ------            ------            ------

    Income before items below.........................    $   354           $   291           $   349

Provision for income taxes............................       (127)             (106)             (134)
Minority interest and other...........................         (4)               (2)               (2)
                                                           ------            ------            ------

    Net income........................................    $   223           $   183           $   213
                                                           ======            ======            ======

Net income per common share...........................    $  2.68           $  2.16           $  2.40
                                                           ======            ======            ======

Average shares outstanding............................       83.2              84.5              88.6

<FN>
See Notes to Consolidated Financial Statements.
</FN>
</TABLE>


<PAGE>

<TABLE>
<CAPTION>

Consolidated Balance Sheets

ASSETS                                        August 31,       1996                1995
-----------------------------------------------------------------------------------------------------
(In millions)
<S>                                                         <C>                 <C>

CURRENT ASSETS
   Cash and cash equivalents............................    $    99             $    84
   Receivables:
      Trade.............................................        208                 163
      Other.............................................         35                  46
   Inventories..........................................        382                 426
   Deferred income taxes................................         58                  49
   Other current assets.................................          2                   2
                                                             ------              ------


      Total current assets..............................    $   784             $   770
                                                             ------              ------


LONG-TERM ASSETS........................................    $    81             $    41
                                                             ------              ------


PROPERTY AND EQUIPMENT
   Land and land improvements...........................    $    63             $    61
   Buildings............................................        354                 331
   Machinery and equipment..............................        512                 481
   Construction in progress.............................         56                  37
                                                             ------              ------
                                                            $   985             $   910
   Less accumulated depreciation........................        475                 438
                                                             ------              ------
                                                            $   510             $   472
                                                             ------              ------


INTANGIBLES.............................................    $    47             $    10
                                                             ------              ------

                                                            $ 1,422             $ 1,293
                                                             ======              ======

<FN>
See Notes to Consolidated Financial Statements.
</FN>
</TABLE>


<PAGE>

<TABLE>
<CAPTION>

Consolidated Balance Sheets

LIABILITIES AND SHAREHOLDERS' EQUITY          August 31,       1996                1995
-----------------------------------------------------------------------------------------------------
(In millions)
<S>                                                         <C>                 <C>

CURRENT LIABILITIES
   Short-term borrowings................................    $    13             $    58
   Current maturities of long-term debt.................         12                  53
   Accounts payable, trade..............................         89                  58
   Accrued compensation.................................         65                  45
   Income taxes payable.................................         63                  23
   Other................................................         46                  43
                                                             ------              ------

      Total current liabilities.........................    $   288             $   280
                                                             ------              ------


LONG-TERM DEBT..........................................    $    25             $    18
                                                             ------              ------

DEFERRED ITEMS
   Postretirement benefits..............................    $    40             $    37
   Other................................................         44                  38
                                                            -------             -------
                                                            $    84             $    75
                                                             ------              ------

CONTINGENCIES

MINORITY INTEREST IN SUBSIDIARIES.......................    $     7             $     7
                                                             ------              ------

SHAREHOLDERS' EQUITY Capital stock:
      Preferred, authorized 10,000,000 shares; issued none  $    --             $    --
      Common, $1 par value; authorized 150,000,000 shares;
         issued 92,693,578 shares.......................         93                  93
   Additional paid-in capital...........................         23                  18
   Retained earnings....................................      1,272               1,118
   Unrealized gain on available-for-sale securities, net         11                  --
   Cumulative translation adjustment....................         (3)                  1
                                                             ------              ------
                                                            $ 1,396             $ 1,230

   Less:
      Cost of common shares acquired for the treasury, 1996
         -- 10,304,700 shares; 1995 -- 9,206,749 shares.       (364)               (303)
      Unearned compensation.............................        (14)                (14)
                                                             ------              ------

                                                            $ 1,018             $   913
                                                             ------              ------

                                                            $ 1,422             $ 1,293
                                                             ======              ======

<FN>
See Notes to Consolidated Financial Statements.
</FN>
</TABLE>


<PAGE>

<TABLE>
<CAPTION>

Consolidated Statements of Cash Flows

                                Years Ended August 31,       1996            1995              1994
------------------------------------------------------------------------------------------------------------------
(In millions)
<S>                                                       <C>             <C>               <C>

CASH FLOWS FROM OPERATING ACTIVITIES
    Net income........................................    $   223         $   183           $   213
    Noncash items included in net income:
        Depreciation .................................         65              61                60
        Amortization..................................         12              13                15
        Restructuring of operations...................         --              --                 3
        Provision for doubtful accounts...............          5               2                 5
        (Gain) loss on disposal of assets.............         (4)              1                 2
        Foreign currency exchange (gain) loss.........         (4)              2                 4
        Other noncash items...........................          5               4                (8)
    Change in assets and liabilities, net:
        Receivables...................................        (46)            (20)              (31)
        Inventories...................................         43             (68)               26
        Accounts payable and accrued expenses.........         61             (39)               23
        Income taxes payable .........................         40              (8)               12
        Other assets and liabilities..................        (11)              9                 7
                                                           ------          ------            ------

        Net cash provided by operating activities.....    $   389         $   140           $   331
                                                           ------          ------            ------

CASH FLOWS FROM INVESTING ACTIVITIES
    Proceeds from sale of assets......................    $    15         $     6           $     6
    Payments received on notes receivable.............         12               6                 9
    Disbursements for notes receivable................         (2)             (4)               (6)
    Capital expenditures..............................       (116)            (86)              (79)
    Technology investments............................        (48)             --                --
    Other, net........................................         (5)             (4)               (8)
                                                           ------          ------            ------

        Net cash used in investing activities.........    $  (144)        $   (82)          $   (78)
                                                           ------         -------            ------

CASH FLOWS FROM FINANCING ACTIVITIES
    Net short-term borrowings (payments)..............    $   (42)        $    45           $   (47)
    Proceeds from long-term borrowings................          1               5                 3
    Principal payments on long-term borrowings........        (55)             (2)               (5)
    Purchase of common stock..........................        (62)           (100)             (113)
    Cash dividends paid...............................        (69)            (60)              (52)
                                                           ------          ------            ------

        Net cash used in financing activities.........    $  (227)        $  (112)          $  (214)
                                                           ------          ------            ------

Effect of foreign currency exchange rate
    changes on cash and cash equivalents..............    $    (3)        $     3           $    --
                                                           ------          ------            ------
Effect of change in year-end of the Company's international
    subsidiaries on cash and cash equivalents.........    $    --         $    --           $     4
                                                           ------          ------            ------
        Net increase (decrease) in cash and cash
          equivalents.................................    $    15    $        (51)          $    43
Cash and cash equivalents, beginning..................         84             135                92
                                                           ------          ------            ------

CASH AND CASH EQUIVALENTS, ENDING.....................    $    99         $    84           $   135
                                                           ======          ======            ======

<FN>
See Notes to Consolidated Financial Statements.
</FN>
</TABLE>


<PAGE>

<TABLE>
<CAPTION>

Consolidated Statements of Shareholders' Equity

                                      Years Ended August 31,       1996            1995            1994
---------------------------------------------------------------------------------------------------------------------
(In millions)
<S>                                                            <C>              <C>             <C>

COMMON STOCK
   Balance, beginning and ending............................   $     93         $    93         $    93
                                                                -------          ------          ------

ADDITIONAL PAID-IN CAPITAL
   Balance, beginning.......................................   $     18         $    15         $    13
      Common stock issued from treasury for restricted stock plan     3               1               1
      Tax benefits related to restricted stock plan.........          2               2               1
                                                                -------          ------          ------
   Balance, ending..........................................   $     23         $    18         $    15
                                                                -------          ------          ------

RETAINED EARNINGS
   Balance, beginning.......................................   $  1,118         $   995         $   835
      Net income............................................        223             183             213
      Change in reporting period of international subsidiaries       --              --              (1)
      Cash dividends on common stock (1996 -- $.83 per share;
         1995 -- $.71 per share; 1994 -- $.59 per share)....        (69)            (60)            (52)
                                                                -------          ------          ------
   Balance, ending..........................................   $  1,272         $ 1,118         $   995
                                                                -------          ------          ------

UNREALIZED GAIN ON AVAILABLE-FOR-SALE SECURITIES, NET
   Balance, beginning.......................................   $     --         $    --         $    --
      Current unrealized gain...............................         11              --              --
                                                                -------          ------          ------
   Balance, ending..........................................   $     11         $    --         $    --
                                                                -------          ------          ------

CUMULATIVE TRANSLATION ADJUSTMENT
   Balance, beginning.......................................   $      1         $    (3)        $    (7)
      Current translation adjustment........................         (4)              4               4
                                                                -------          ------          ------
   Balance, ending..........................................   $     (3)        $     1         $    (3)
                                                                -------          ------          ------

TREASURY STOCK
   Balance, beginning.......................................   $   (303)        $  (207)        $   (97)
      Purchase of common stock for the treasury (1996 --1,148,900
         shares; 1995 -- 2,844,209 shares; 1994 -- 3,325,200 shares)(62)           (100)           (113)
      Common stock issued for restricted stock plan, net of forfeitures
         and stock used to satisfy withholding taxes
         (1996 -- 50,949 shares; 1995 -- 116,549 shares; 1994 --
         97,336 shares).....................................          1               4               3
                                                                -------          ------          ------
   Balance, ending..........................................   $   (364)        $  (303)        $  (207)
                                                                -------          ------          ------

UNEARNED COMPENSATION
   Balance, beginning.......................................   $    (14)        $   (12)        $   (12)
      Net additions of common stock to restricted stock plan         (6)             (8)             (4)
      Amortization of unearned compensation.................          6               6               4
                                                                -------          ------          ------
   Balance, ending..........................................   $    (14)        $   (14)        $   (12)
                                                                -------          ------          ------

TOTAL SHAREHOLDERS' EQUITY AT YEAR END......................   $  1,018         $   913         $   881
                                                                =======          ======          ======

<FN>
See Notes to Consolidated Financial Statements.
</FN>
</TABLE>


<PAGE>


NOTES TO CONSOLIDATED FINANCIAL STATEMENTS


Note 1.    Nature of Business and Significant Accounting Policies

           Nature of business:

               The Company's business is the broad application of the science of
               genetics.  Pioneer was founded in 1926 to apply newly  discovered
               genetic   techniques  to  hybridize  corn.   Today,  the  Company
               develops,  produces,  and markets hybrids of corn,  sorghum,  and
               sunflowers;  varieties of soybeans,  alfalfa,  wheat, and canola;
               and  microorganisms  useful  in crop  and  livestock  production.
               Approximately  89  percent of the  Company's  total net sales are
               from the sale of hybrid seed and soybean  seed within the regions
               of North America and Europe.

           Consolidation policy:

               The consolidated financial statements include the accounts of the
               Company and all of its  subsidiaries.  All material  intercompany
               balances and transactions have been eliminated in consolidation.

           Use of estimates:

               The  preparation  of  financial  statements  in  conformity  with
               generally accepted  accounting  principles requires management to
               make estimates and assumptions  that affect the amounts  reported
               in the  financial  statements.  Actual  results could differ from
               those estimates.

           Cash equivalents:

               The Company  considers all liquid  investments with a maturity at
               purchase of three months or less to be cash equivalents.

           Receivables:

               Receivables are stated net of an allowance for doubtful  accounts
               of $23  million  and $19  million  at August  31,  1996 and 1995,
               respectively.

           Inventories:

               Inventories are valued at the lower of cost (first-in,  first-out
               method)  or  market.   Gains  or  losses  on  commodity   hedging
               transactions are included as a component of inventory.

           Property and equipment:

               Property and  equipment is recorded at cost,  net of an allowance
               for loss on plant  closings  of $9 million at August 31, 1996 and
               1995.  Depreciation  is computed  primarily by the  straight-line
               method over estimated service lives of two to forty years.


<PAGE>



           Long-term assets:

               Certain  long-term  assets were classified as  available-for-sale
               securities. No available-for-sale securities were owned at August
               31, 1995.  Available-for-sale securities held at August 31, 1996,
               consisted  of an equity  security  with an  original  cost of $30
               million and an unrealized gain of $17 million.

           Intangibles:

               Intangible  assets are stated at amortized cost and are amortized
               by the straight-line method over one-to twenty-year periods, with
               the  weighted-average  amortization period approximating 12 years
               for the year ended August 31, 1996.  Accumulated  amortization of
               $36  million  and $32  million  at  August  31,  1996  and  1995,
               respectively, have been netted against these assets.

           Basis of accounting:

               Subsidiary  and  asset  acquisitions  are  accounted  for  by the
               purchase method.

           Translation of foreign currencies and foreign exchange hedging:

               All  assets  and  liabilities  in the  balance  sheets of foreign
               subsidiaries  whose  functional  currency  is other than the U.S.
               dollar are  translated at year-end  exchange  rates.  Translation
               gains and losses are not included in  determining  net income but
               are accumulated as a separate component of shareholders'  equity.
               However,  for  subsidiaries  considered to be operating in highly
               inflationary  countries and for certain other  subsidiaries,  the
               U.S. dollar is the functional currency, and translation gains and
               losses are included in determining net income.  Foreign  currency
               transaction  gains and losses are  included  in  determining  net
               income.

               The  Company  uses a  combination  of  forward  foreign  exchange
               contracts  and foreign  currency  option  contracts to hedge open
               foreign-denominated  payables and  receivables  and also to hedge
               firm   sales   and   purchase   commitments   with  its   foreign
               subsidiaries.  Unrealized  gains and losses on hedges of existing
               foreign-denominated payables or receivables are included in other
               assets or  liabilities  and are  recognized  in net exchange gain
               (loss)   in   conjunction    with   the    revaluation   of   the
               foreign-currency-denominated  transaction.  Unrealized  gains and
               losses  related to  qualifying  hedges of firm sales and purchase
               commitments are deferred and recognized in income when the future
               sales  or  purchases  are  recognized,   or  immediately  if  the
               commitment  is canceled.  Option  premiums  paid are amortized to
               income over the life of the contract.

           Income taxes:

               Income  taxes are  computed  in  accordance  with  SFAS No.  109.
               Deferred income taxes have been provided on temporary differences
               in the financial statement and income tax bases of certain assets
               and liabilities.


<PAGE>



               Deferred income taxes have not been provided on the undistributed
               earnings or the cumulative  translation adjustment of the foreign
               subsidiaries  to the extent the Company  intends to reinvest such
               undistributed earnings indefinitely or to repatriate them only to
               the extent that no  additional  income tax  liability is created.
               The  cumulative  amount  of  the  undistributed  net  income  and
               translation adjustment of such subsidiaries is approximately $172
               million at August 31, 1996. The Company files  consolidated  U.S.
               federal  income  tax  returns  with  its  domestic  subsidiaries;
               therefore,  no deferred  income  taxes have been  provided on the
               undistributed earnings of those subsidiaries.

           Pension plans:

               The  Company's  domestic  and  Canadian  operations  have defined
               benefit pension plans covering substantially all their employees.
               The plans  provide  benefits  that are based on  average  monthly
               earnings of the  employees.  The funding  policy is to contribute
               annually an amount to fund pension cost as actuarially determined
               by an independent pension consulting firm.

           Other postretirement benefits:

               The Company sponsors a health care plan and a life insurance plan
               which  provide  benefits  to  eligible  retirees.  The  Company's
               contribution  is based on age and years of service at retirement.
               The health insurance plan contains the  cost-sharing  features of
               coinsurance and/or deductibles.  The life plan is paid for by the
               Company.  Benefits  under  both  plans are  based on  eligibility
               status for pension and length of  service.  Substantially  all of
               the Company's  U.S. and Canadian  full-time  employees may become
               eligible  for these  benefits  upon  reaching  age 55 and  having
               worked for the Company at least five years.

           Deferred executive  compensation and supplemental  retirement benefit
           plans:

               The estimated  liability for the deferred executive  compensation
               and supplemental  retirement  benefit plans is being accrued over
               the expected remaining years of active employment.

           Restricted stock and stock option plans:

               The Company has a restricted stock plan and a non-qualified stock
               option plan. The Company  amortizes as  compensation  expense the
               cost of  stock  acquired  for the  restricted  stock  plan by the
               straight-line  method over the five-year  restriction  period. No
               compensation  expense is recorded under the  non-qualified  stock
               option plan.

               In  1995,  the  FASB  issued  SFAS  No.  123,   "Accounting   for
               Stock-Based  Compensation."  This  statement  establishes  a fair
               value-based  method of accounting  for  stock-based  compensation
               plans.  While its  adoption  is  encouraged  for all  stock-based
               plans,  companies  may continue  applying the current  accounting
               treatment  prescribed  by the  provisions  of APB  Opinion No. 25
               "Accounting for Stock Issued to Employees."  Companies continuing
               to apply the  provisions  of APB  Opinion  No. 25 must,  however,
               provide  certain  pro forma  disclosures  as if SFAS No. 123 were
               adopted for all stock-based  compensation plans. The Company will
               retain the current accounting method for stock-based compensation
               plans and will provide the necessary  disclosures  as required in
               fiscal 1997.


<PAGE>



           Other:

               In  1995,  SFAS  No.  121,  "Accounting  for  the  Impairment  of
               Long-Lived  Assets and for Long-Lived  Assets to be Disposed Of,"
               was issued.  This  statement  requires the review of the recorded
               values of long-lived  assets  (including  intangibles) when facts
               and  circumstances  indicate that the carrying  values may not be
               recoverable.   In  addition,   the  statement   requires  certain
               adjustments  for closing and sale costs to the carrying values of
               assets to be  disposed.  The  Company  will adopt SFAS No. 121 in
               fiscal 1997, as required.  Management  believes its adoption will
               not have a material  effect on the carrying  values of long-lived
               assets.

Note 2.    Inventories

           The composition of inventories is as follows:

<TABLE>
<CAPTION>

                                              August 31,       1996            1995
-----------------------------------------------------------------------------------------------------
           (In millions)
           <S>                                              <C>             <C>

           Finished seed................................    $   209         $   280
           Unfinished seed..............................        163             140
           Supplies and other...........................         10               6
                                                             ------          ------
                                                            $   382         $   426
                                                             ======          ======
</TABLE>


           Unfinished  seed  represents  the  Company's  cost  of  parent  seed,
           detasseling  and roguing labor,  and certain other  production  costs
           incurred  by the  Company to  produce  its seed  supply.  Much of the
           balance of the labor, equipment, and production costs associated with
           planting, growing, and harvesting the seed is supplied by independent
           growers, who contract specific acreage for the production of seed for
           the  Company.   The  compensation  of  the  independent   growers  is
           determined  based  upon  yield,  contracted  acreage,  and  commodity
           prices. The commitment for grower  compensation is accrued as seed is
           delivered to the Company. Accrued grower compensation was $11 million
           and $6 million at August 31, 1996 and 1995, respectively.

           The  Company  uses  commodity  futures  and  options to hedge  grower
           compensation  costs.  At August 31,  1996 and 1995,  the  Company had
           futures contracts with brokers on notional quantities amounting to 17
           million bushels and 7 million  bushels,  respectively for corn, and 6
           million bushels and 5 million bushels,  respectively for soybeans. At
           August  31,  1996,  unrealized  losses  on  these  contracts  were $2
           million.


Note 3.    Current Borrowings, Lines of Credit, Long-Term Debt, and Guarantees

           At August 31, 1996, the Company had domestic lines of credit totaling
           $200 million  available to be used as support for the issuance of the
           Company's commercial paper. There was no commercial paper outstanding
           at August 31, 1996.  Commercial paper outstanding at August 31, 1995,
           was $43 million at a weighted average interest rate of 5.9 percent.


<PAGE>



           In addition,  the Company's foreign subsidiaries have lines of credit
           and direct borrowing  agreements totaling $44 million,  substantially
           all of which are unsecured. At August 31, 1996, short-term borrowings
           of $13  million  were  outstanding  under  these lines of credit at a
           weighted  average  interest rate of 8.9 percent.  At August 31, 1995,
           short-term  borrowings of $15 million were outstanding  under foreign
           subsidiary  lines of credit at a weighted  average  interest  rate of
           17.8 percent.

           The  long-term  debt at August 31,  1996,  bears  interest at varying
           rates and requires annual principal payments through fiscal 2011. The
           maturities  of  long-term  debt for the next five  fiscal  years,  in
           millions, are as follows: $12, $6, $14, $0.3, and $1.

           The Company has guaranteed the repayment of principal and interest on
           certain  obligations of Village Court Associates,  an affiliated real
           estate  venture.   At  August  31,  1996,  such  guarantees   totaled
           approximately $23 million.

Note 4.    Income Taxes

           The provision for income taxes is based on income before income taxes
           as follows:
<TABLE>
<CAPTION>

                                Years Ended August 31,       1996            1995             1994
----------------------------------------------------------------------------------------------------------------
           (In millions)
           <S>                                            <C>             <C>             <C>


           United States..............................    $   266         $   198         $    272
           Foreign....................................         88              93               77
                                                           ------          ------          -------
                                                          $   354         $   291         $    349
                                                           ======          ======          =======
</TABLE>



           The   provision  for  income  taxes  is  composed  of  the  following
           components:
<TABLE>
<CAPTION>

                                            August 31,       1996            1995             1994
----------------------------------------------------------------------------------------------------------------
           (In millions)
           <S>                                            <C>             <C>             <C>

           Current:
               Federal................................    $    83         $    59         $    101
               State..................................         11              10               15
               Foreign................................         44              36               29
                                                           ------          ------          -------
                                                          $   138         $   105         $    145
                                                           ------          ------          -------
           Deferred:
               Federal................................    $    (9)        $     4         $    (12)
               State..................................         (1)              -               (2)
               Foreign................................         (1)             (3)               3
                                                           ------          ------          -------
                                                          $   (11)        $     1         $    (11)
                                                           ------          ------          -------
                                                          $   127         $   106         $    134
                                                           ======          ======          =======
</TABLE>



<PAGE>



           The  tax  effects  of  temporary   differences   that  give  rise  to
           significant  portions of the  deferred  tax assets and  deferred  tax
           liabilities at August 31, 1996 and 1995, are presented below:
<TABLE>
<CAPTION>

                                                August 31,       1996            1995
---------------------------------------------------------------------------------------------------
           (In millions)
           <S>                                                <C>             <C>

           Deferred tax assets:
               Allowance for doubtful accounts............    $     6         $     6
               Inventories................................         33              23
               Benefits/compensation......................         35              32
               Deferred profit............................          8              10
               Nondeductible reserves.....................          8               3
               Net operating loss carryforwards...........          5               8
               Other......................................          7               7
                                                               ------          ------
                  Total gross deferred tax asset..........    $   102         $    89
                  Less valuation allowance................         (8)            (11)
                                                               ------          ------
                  Total deferred tax asset................    $    94         $    78
                                                               ------          ------
           Deferred tax liabilities:
               Property and equipment.....................    $   (46)        $   (41)
               Unrealized gain on available-for-sale securities                   (6)         --
               Other......................................         --              (1)
                                                               ------          ------
                  Total deferred tax liability............    $   (52)        $   (42)
                                                               ------          ------
                  Net deferred tax asset..................    $    42         $    36
                                                               ======          ======
</TABLE>


           The  net   operating   loss   carryforwards   result   from   various
           international  subsidiaries.  The  expiration  of these net operating
           losses range from 1997 to indefinite.  Utilization of these losses is
           dependent upon earnings generated in the respective  subsidiaries.  A
           valuation  allowance  for the losses and certain other items has been
           set up where appropriate.

           The net change in the total  valuation  allowance  for the year ended
           August 31, 1996, was a decrease of $3 million. There was no change as
           of the end of August 31, 1995.

           Following is a  reconciliation  of the statutory U.S.  Federal income
           tax rate to the Company's actual worldwide effective income tax rate:
<TABLE>
<CAPTION>

                                        Years Ended August 31,   1996          1995           1994
-----------------------------------------------------------------------------------------------------------------
           <S>                                                   <C>           <C>            <C>

           Statutory U.S. Federal income tax rate.............   35.0 %        35.0 %         35.0 %
           State income taxes, net of Federal income tax benefit  1.8           2.4            2.5
           Effect of taxes on foreign earnings................     --          (0.9)           1.8
           Foreign Sales Corporation..........................   (0.5)         (0.7)          (1.1)
           Other..............................................   (0.3)          0.7            0.3
                                                                 ----           ---           ----
               Actual effective income tax rate...............   36.0 %        36.5 %         38.5 %
                                                                 ====          ====           ====
</TABLE>



<PAGE>


Note 5.    Pension Plans and Other Postretirement Benefits

           Qualified pension plans:

           The  components  of pension  expense  relating to  qualified  defined
           benefit pension plans for the years ended August 31, 1996,  1995, and
           1994, consisted of the following:

<TABLE>
<CAPTION>
                                                                1996            1995            1994
--------------------------------------------------------------------------------------------------------------------
           (In millions)

           <S>                                                <C>             <C>             <C>    
           Service cost...................................    $     7         $     7         $     6
           Interest cost on projected benefit obligation..         11              11               9
           Actual return on plan assets...................        (14)            (12)            (11)
           Net amortization and deferral..................         (1)             (1)             (1)
                                                               ------          ------          ------
               Pension expense............................    $     3         $     5         $     3
                                                               ======          ======          ======
</TABLE>


           The  following  table sets forth the plans'  funded status as of June
           30, 1996 and 1995, respectively:
<TABLE>
<CAPTION>

                                                                          1996            1995
------------------------------------------------------------------------------------------------------------
           (In millions)
           <S>                                                         <C>             <C>

           Actuarial present value of benefit obligations:
               Vested benefit obligation...........................    $   101         $    96
                                                                        ======          ======
               Accumulated benefit obligation......................    $   108         $   102
                                                                        ======          ======
           Plan assets at fair value, primarily stocks and bonds...    $   179         $   158
           Projected benefit obligation............................        153             147
                                                                        ------          ------
           Plan assets in excess of projected benefit obligation...    $    26         $    11
           Unrecognized net (gain)/loss............................        (11)              9
           Unrecognized prior service cost.........................          2               2
           Unrecognized transition asset, net (recognized over 16 years)                    (8)
                                                                                        ------
           (10)
               Pension asset.......................................    $     9         $    12
                                                                        ======          ======
</TABLE>


           Plan assets  include common stock of the Company totaling $14 million
           and $11 million at June 30, 1996 and 1995, respectively.

           In determining the present value of benefit  obligations,  a discount
           rate of 8 percent was used in 1996 and 1995.  The expected  long-term
           rate of return on plan assets was 9 percent  and the assumed  rate of
           increase in compensation levels was 6.5 percent in both years.

           Non-qualified pension plans:

           The components of pension expense relating to  non-qualified  pension
           plans for the years ended August 31, 1996, 1995, and 1994,  consisted
           of the following:
<TABLE>
<CAPTION>

                                                                 1996            1995            1994
--------------------------------------------------------------------------------------------------------------------
           (In millions)
           <S>                                                <C>             <C>             <C>

           Service cost...................................    $     1         $     2         $     1
           Interest cost on projected benefit obligation..          3               3               2
           Net amortization and deferral..................          1               1               1
                                                               ------          ------          ------
               Pension expense............................    $     5         $     6         $     4
                                                               ======          ======          ======
</TABLE>


<PAGE>


           The following  table sets forth the plans' funded status as of August
           31, 1996 and 1995, respectively:

<TABLE>
<CAPTION>
                                                                 1996            1995
---------------------------------------------------------------------------------------------------
           (In millions)

           <S>                                                <C>             <C>
           Actuarial present value of benefit obligations:
               Vested benefit obligation..................    $    16         $     7
                                                               ======          ======
               Accumulated benefit obligation.............    $    16         $     8
                                                               ======          ======

           Plans' assets at fair value....................    $    --         $    --
           Projected benefit obligation...................         37              39
                                                               ------          ------
           Plans' assets less than projected benefit
             obligation...................................    $   (37)        $   (39)
           Unrecognized net loss..........................          4              10
           Unrecognized prior service cost................         11              11
           Unrecognized transition asset, net.............          1               1
                                                               ------          ------
               Pension liabilities........................    $   (21)        $   (17)
                                                               ======          ======
</TABLE>

           In determining the present value of benefit  obligations,  a discount
           rate of 8 percent  was used in 1996 and  1995.  The  assumed  rate of
           increase in compensation levels used was 8 percent in both years.

           Other postretirement benefit plans:

           The components of postretirement benefits cost expensed for the years
           ended August 31, 1996, 1995, and 1994, consisted of the following:

<TABLE>
<CAPTION>
                                                                    1996           1995          1994
--------------------------------------------------------------------------------------------------------------------
           (In millions)
           <S>                                                   <C>            <C>           <C>

           Service cost -- benefits earned during the year....   $     2        $     2       $     2
           Interest cost on accumulated postretirement benefit
             obligation.......................................         3              2             3
           Return on assets...................................        --             --            --
           Net amortization and deferral......................        --             --             1
                                                                  ------         ------        ------
               Other postretirement benefits cost.............   $     5        $     4       $     6
                                                                  ======         ======        ======

</TABLE>

           The following  table sets forth the plans' funded status as of August
           31, 1996 and 1995, respectively:

<TABLE>
<CAPTION>
                                                                    1996            1995
-----------------------------------------------------------------------------------------------------------
           (In millions)
           <S>                                                       <C>             <C>

           Accumulated postretirement benefit obligation:
           Retirees..............................................    $   (12)        $   (12)
           Other fully eligible plans' participants..............         (8)             (7)
           Other active plans' participants......................        (20)            (17)
                                                                      ------          ------
                                                                     $   (40)        $   (36)
           Plans' assets at fair value...........................         --              --
                                                                      ------          ------
           Accumulated postretirement benefit obligation in excess of
             plans' assets.......................................    $   (40)        $   (36)
           Unrecognized prior service cost.......................         (1)             (1)
           Unrecognized net loss.................................          1              --
                                                                      ------          ------
               Accrued postretirement benefits cost..............    $   (40)        $   (37)
                                                                      ======          ======
</TABLE>


<PAGE>




           For  1996  and  1995,  the  discount  rate  used in  determining  the
           accumulated  postretirement  benefit  obligation was 8 percent. A 9.5
           percent  annual  rate of  increase  in the per capita cost of covered
           health care  benefits was assumed for 1996.  This rate was assumed to
           decrease  gradually  to 5.5  percent  in year 2004 and remain at that
           level  thereafter.  A  one-percentage-point  increase  in the assumed
           health  care  cost  trend  rates  would   increase  the   accumulated
           postretirement   benefit   obligation  as  of  August  31,  1996,  by
           approximately  $7 million and the total of the  service and  interest
           cost components of net  postretirement  health care cost for the year
           then ended by approximately $1 million.

Note 6.    Commitments and Contingencies

           Pioneer  has a  development/license  agreement  with  a  third  party
           granting  Pioneer  the  right  to  develop  and  produce  an elite Bt
           transgenic  corn line which,  when combined with other elite inbreds,
           would   provide   commercially   viable   yield   levels,   agronomic
           performance,  and European corn borer (ECB)  control.  Under terms of
           the agreement,  the Company is committed to compensate  based upon 1)
           determination  of  commercial  level  ECB  protection  2)  regulatory
           approval  and 3) the  cumulative  sale  of  specified  quantities  of
           licensed  corn  seed  worldwide.   The  Company   believes  that  all
           requirements  for  payment  are  likely  to be  met in  fiscal  1997.
           Contingent payments under this agreement total $26 million,  and will
           be  amortized  ratably  over  the  expected  cycle  of  the  relevant
           products.

Note 7.    Legal Matters

           Since April, 1996, DeKalb Genetics  Corporation  ("DeKalb") has filed
           five  lawsuits  against  Pioneer.  The  lawsuits  allege  that insect
           resistant  corn  products  that  use a Bt  gene,  and  corn  products
           resistant  to a  glufosinate  herbicide,  infringe on certain  DeKalb
           patents.

           After reviewing the Company's  intellectual property position, all of
           DeKalb's  patent filings,  and DeKalb's  lawsuits,  Pioneer  believes
           DeKalb's  claims are  without  merit.  Pioneer  has  denied  DeKalb's
           allegations  and raised  defenses that, if  successful,  would render
           DeKalb's  patents  invalid.  Pioneer believes that disposition of the
           lawsuits   will  not  have  a  materially   adverse   affect  on  the
           consolidated  financial  position  and results of  operations  of the
           Company.  Pioneer also does not expect delays in the introductions of
           advanced corn hybrids with insect and herbicide resistance because of
           these lawsuits.


Note 8.    Financial Instruments

           Foreign exchange:

           The Company uses foreign  currency  hedge  instruments  to manage the
           effect of exchange rate fluctuations on the U.S. dollar value of cash
           flows   of   foreign    operations   and   the   income   effect   of
           foreign-currency-denominated   transactions.  The  primary  financial
           instruments used are foreign exchange  forward  contracts,  purchased
           foreign  currency   options,   and  cross  currency  swaps.  In  some
           countries,  foreign  currency hedge  instruments are not available or
           are cost prohibitive.  The exposures in these countries are addressed
           through managing net asset positions and borrowing in local currency,
           or investing in U.S.
           dollars.


<PAGE>



           While the hedge instruments are subject to risk of loss from exchange
           rate  movement,  we expect these losses would  generally be offset by
           gains in the U.S.  dollar  value of foreign  sales and/or cash flows.
           The Company does not trade these  instruments  with the  objective of
           earning  financial  gains on the  exchange  rate  price  fluctuations
           alone,  nor  does it trade  in  currencies  for  which  there  are no
           underlying exposures.

           The  notional  amounts for  contracts in place at August 31, 1996 and
           1995,  are  shown  in the  following  table  in U.S.  dollars.  These
           contracts generally mature in less than one year.
<TABLE>
<CAPTION>

                                              August 31,       1996            1995
--------------------------------------------------------------------------------------------------
           (In millions)

          <S>                                               <C>             <C>    
           Forwards.....................................    $    79         $   129
           Options Purchased............................         14              18
           Swaps........................................         26              34
                                                             ------          ------
                                                            $   119         $   181
                                                             ======          ======

</TABLE>

           At August 31, 1996, deferred unrealized gains and losses from hedging
           firm purchase and sale  commitments,  based on broker quoted  prices,
           were $0.5 million and $6 million, respectively.

           Credit risk:

           The  Company's  financial  instruments  subject  to  credit  risk are
           primarily trade accounts receivable,  cash and cash equivalents,  and
           foreign currency exchange contracts. The Company is exposed to credit
           risk of nonperformance by counterparties. Generally, the Company does
           not  require   collateral  or  other  security  to  support  customer
           receivables   or   foreign   currency   exchange    contracts.    The
           counterparties to the Company's hedge instruments are major financial
           institutions.  The  Company  evaluates  the  creditworthiness  of the
           counterparties  to hedge instruments and has never  experienced,  nor
           does it anticipate, nonperformance by any of its counterparties.

           The Company had the  following  significant  concentrations  of trade
           accounts receivables, and cash and cash equivalents subject to credit
           risk:

<TABLE>
<CAPTION>
                                        August 31,             1996           1995
----------------------------------------------------------------------------------
           (In millions)
           <S>                                              <C>             <C>

           United States................................    $   141         $    92
           Italy........................................    $    57         $    57
           Brazil.......................................    $    19         $    16
           Argentina....................................    $    11         $    12
           Central Europe...............................    $     9         $     8

</TABLE>

           Within the U.S., the majority of the Company's  business is conducted
           with  individual  farm  operators  located  throughout  the  country.
           Outside  the  U.S.,  the  majority  of  the  Company's   business  is
           transacted with distributors and cooperatives,  some being government
           sponsored.


<PAGE>


           Fair value:

           The Company estimated the fair value of its financial  instruments by
           discounting the expected future cash flows using the current interest
           rates  which  would  apply to each  class of  financial  instruments,
           except for foreign  currency  contracts for which quotes from brokers
           were used.

           The  fair  value  of  cash   equivalents,   receivables,   short-term
           borrowings,   long-term   debt,   and  foreign   currency   contracts
           approximates carrying value at August 31, 1996.

Note 9.    Restructuring and Settlements

           On July 13, 1994, the U.S.  Circuit Court of Appeals affirmed a prior
           court's decision in the Company's  lawsuit against Holden  Foundation
           Seeds,  Inc.,  awarding  Pioneer  damages for lost  profits  from the
           misappropriation  of germplasm.  In August 1994, the Company received
           the settlement plus interest totaling  approximately $52 million. The
           Company also incurred $7 million of restructuring charges.

Note 10.   Capital Stock

           Restricted stock plans:

           The Company  has a  restricted  stock plan under which  shares of the
           Company's  common  stock are held by the Company for officers and key
           employees. Such stock is subject to an agreement requiring forfeiture
           by the employee in the event of termination of employment within five
           years of the  date of grant  other  than as a result  of  retirement,
           death,  or disability.  The maximum  number of shares  authorized for
           grant  under  this plan is  1,750,000  shares.  No  shares  have been
           granted as of August 31, 1996.

           Under  previous  restricted  stock  plans,   824,899  shares  of  the
           Company's  common stock are held for officers and key employees.  The
           maximum  number of shares  authorized  for grant under these plans is
           5,250,000  shares,  of which  2,157,323 had been granted as of August
           31, 1996.

           Stock option plan:

           During 1996, the Company adopted a  non-qualified  stock option plan.
           The plan  authorizes  options  covering  three million  shares of the
           Company's  common  stock.  Options  under  the plan  are  exercisable
           one-third  in each of years  three,  four,  and five from the date of
           grant.  The  options  expire  after ten years from the date of grant.
           Options  are  forfeited  upon  termination  for  reasons  other  than
           retirement,  death,  or  disability.  During the year,  options  were
           granted  covering  973,000  shares  at an  exercise  price of $43 per
           share.
           All such options remain outstanding as of August 31, 1996.

           Voting rights:

           Generally,  each share of common  stock is entitled to five votes per
           share if the share has been  beneficially  owned  continuously by the
           same  person  for a period of 36  consecutive  months  preceding  the
           record date for the relevant  shareholders' meeting. All other shares
           are entitled to one vote per share.


<PAGE>



           Share repurchase:

           At August 31, 1996, authorized shares remaining to be purchased under
           a Board authorized repurchase plan approximated 2.5 million.

Note 11.   Geographic Data

           Certain financial  information  concerning the Company's domestic and
           foreign operations is as follows:
<TABLE>
<CAPTION>

                                Years Ended August 31,       1996            1995             1994
--------------------------------------------------------------------------------------------------
           (In millions)
           <S>                                            <C>             <C>             <C>

           Net sales (by source):
               United States..........................    $ 1,435         $ 1,271         $  1,270
               Europe.................................        387             349              249
               Other..................................        222             189              190
                                                           ------          ------          -------
                 Total sales..........................    $ 2,044         $ 1,809         $  1,709
               Less intergeographical sales, primarily
                  United States.......................        323             277              230
                                                           ------          ------          -------
                                                          $ 1,721         $ 1,532         $  1,479
                                                           ======          ======          =======
           Operating income (by source):
               United States..........................    $   334         $   269         $    341
               Europe.................................         56              53               33
               Other..................................         33              31               40
                                                           ------          ------          -------
                                                          $   423         $   353         $    414
               Indirect general and administrative expense    (76)            (73)             (68)
                                                           ------          ------           ------
                                                          $   347         $   280         $    346
                                                           ======          ======          =======

           Identifiable assets at August 31:
               United States..........................    $   701         $   736         $    668
               Europe.................................        224             212              197
               Other..................................        244             210              201
                                                           ------          ------          -------
                                                          $ 1,169         $ 1,158         $  1,066
               Corporate..............................        253             135              187
                                                           ------          ------          -------
                                                          $ 1,422         $ 1,293         $  1,253
                                                           ======          ======          =======

           Export Sales:
               Primarily Europe.......................    $    20         $    15         $     18
                                                           ======          ======          =======
</TABLE>

Note 12.   Unaudited Quarterly Financial Data

           Summarized unaudited quarterly financial data for 1996 is as follows:
<TABLE>
<CAPTION>

           Three Months Ended             November 30   February 29        May 31        August 31
--------------------------------------------------------------------------------------------------
           (In millions, except per share amounts)

           <S>                            <C>             <C>             <C>             <C>

           Net sales..................    $    92         $   281         $ 1,168         $    180
           Gross profit...............    $     8         $   107         $   691         $     52
           Net income (loss)..........    $   (49)        $     4         $   303         $    (35)
           Net income (loss) per
               common share (1).......    $  (.59)        $    .05        $   3.64        $   (.42)
           Cash dividends per
               common share(1)........    $   .20         $    .20        $    .20        $    .23

</TABLE>

<PAGE>




           Summarized unaudited quarterly financial data for 1995 is as follows:
<TABLE>
<CAPTION>

           Three Months Ended             November 30   February 28        May 31        August 31
--------------------------------------------------------------------------------------------------
           (In millions, except per share amounts)
           <S>                            <C>             <C>             <C>             <C>

           Net sales..................    $    69         $   277         $ 1,049         $    137
           Gross profit...............    $     2         $   104         $   632         $     21
           Net income (loss)..........    $   (48)        $     9         $   272         $    (50)
           Net income (loss) per
               common share (1).......    $  (.57)        $    .11        $   3.23        $   (.59)
           Cash dividends per
               common share (1).......    $   .17         $    .17        $    .17        $    .20
<FN>

           (1) As a result of rounding, the total of the four quarters' earnings
           and cash  dividends  per share may not  equal the  earnings  and cash
           dividends per share for the year.
</FN>
</TABLE>


Note 13.   Supplemental Cash Flow Information

           Certain financial information concerning the Consolidated  Statements
           of Cash Flows is as follows:

<TABLE>
<CAPTION>
                                Years Ended August 31,       1996            1995             1994
--------------------------------------------------------------------------------------------------
           (In millions)
           <S>                                            <C>             <C>             <C>

           Cash payments:
               Interest...............................    $    14         $    13         $     13
               Income taxes...........................    $    93         $   117         $    145

           Noncash investing and financing activities:
               Intangibles acquired by the issuance of 
                long-term debt........................... $    20         $    --         $     --
</TABLE>


<PAGE>



Research and Product Development

At August 31, 1996, the Company  employed 917 people who directly and indirectly
engage in research and product development activities.  Of these, 360 scientists
performed  research in the agricultural seed area and 11 in microbial  cultures.
Of the 360 scientists performing research in agricultural seeds, 52 are employed
outside of North America and 121 are focused on  biotechnology  research.  Total
research expenditures for 1996 were $136 million.  During the three fiscal years
ended August 31, 1996,  the Company  expended the following  amounts on research
and product development:

<TABLE>
<CAPTION>


         Years Ended August 31,       1996              1995              1994
--------------------------------------------------------------------------------
(In millions)
<S>                                <C>               <C>               <C>

Corn...........................    $    90           $    87           $    75
Soybeans.......................         12                10                 9
Other Products.................         34                33                30
                                    ------            ------            ------
  Total........................    $   136           $   130           $   114
                                    ======            ======            ======
</TABLE>


Planned growth in biotechnology projects, research collaborations, and trait and
technology  development  makes up most of the increase over 1995. The investment
in research has increased yearly since 1973, supporting the Company's commitment
to improving products through research and product development.

Properties

Pioneer owns and operates 22 commercial seed corn  conditioning  plants in North
America.  These  plants are  located in Illinois  (4),  Indiana  (4),  Iowa (8),
Michigan (1), Nebraska (2), Texas (1), and Ontario, Canada (2).

Seed corn,  unlike  commercial corn, must be harvested and dried before freezing
temperatures  can limit  germination  potential.  Because of this,  seed  drying
capacity is a critical  factor.  The dryers at the North American  plants have a
total  capacity of two million  bushels  and,  depending on factors such as seed
moisture  content,  can be  filled  11 times  before  fall  weather  presents  a
significant freeze risk.

At normal  capacity,  the husking and sorting units at the North American plants
can handle 54,580 bushels of ear corn per hour. In total,  these plants have the
capacity to condition 14,400 units per hour. In a normal year, seed conditioning
is completed by early  February.  These plants have the  facilities  to store 10
million  bushels  of bulk  seed and 15.6  million  units of  bagged  seed  corn,
including cold storage for 7.4 million units.

In North  America,  conditioning  of other  commercial  PioneerAE  brand seed is
performed at a total of 17 plants,  six of which also  condition  corn.  Pioneer
also owns interests in 24 commercial  production  plants in 21 countries outside
North America. Parent seed is conditioned at nine locations in North America and
at ten locations  outside North America.  Six of these facilities also condition
commercial Pioneer brand seed.

The Company's  plant  breeders  conduct  research at 50 stations in the U.S. and
Canada.  There are 28 stations  which  conduct  research on corn;  four of those
conduct  research  on more than one crop.  There are 22 stations  which  conduct
research on seeds other than corn.  One of these stations  conducts  research on
more than one crop. In addition to these research efforts, Pioneer conducts seed
research at 43 locations throughout the rest of the world.


<PAGE>



In addition  to the  research  stations,  approximately  273,000  square feet of
laboratory,  greenhouse,  and office space  located in  Johnston,  Iowa are also
devoted to plant breeding, biotechnology, and microbial product research.

Additional   production   facilities  for  microbial  products  are  located  at
Company-owned  properties in Durant,  Iowa and Buxtehude,  Germany.  A livestock
nutrition farm,  located in Sheldahl,  Iowa conducts  research for the nutrition
and industry markets (NIM) group and for microbial products.

Pioneer also owns 5,783 acres of  agricultural  land in the U.S. used  primarily
for research  activities.  Of this,  1,000 acres  located in Johnston,  Iowa are
under commercial and residential development.  As properties are developed, they
are either sold or retained as equity projects.

Company  properties,  substantially  all of which are  owned,  were  subject  to
aggregate  encumbrances  of $1 million on August 31, 1996. The Company  believes
that all properties,  including  machinery,  equipment,  and vehicles,  are well
maintained, suitable for their intended uses, and adequately insured.


<PAGE>


MARKET FOR THE COMPANY'S COMMON STOCK AND RELATED SECURITY HOLDER MATTERS

On November 7, 1995,  the  Company's  stock began  trading on the New York Stock
Exchange.  Prior to that date,  the  Company's  stock was traded in the National
Association of Securities  Dealers National Market System.  The range of closing
prices for these shares for the past two years follows:
<TABLE>
<CAPTION>

                                          1996                       1995
             -------------------------------------------------------------------
             <S>                   <C>         <C>            <C>         <C>
             Quarter:              High        Low            High        Low
             First.............    57 3/8      42 3/4         35 1/4      30
             Second............    60 1/8      49 1/4         38 3/4      32 3/4
             Third.............    57          51 1/4         39 1/4      32 1/2
             Fourth............    57 1/4      49 3/4         45 1/2      38 3/4

</TABLE>

On August  31,  1996,  there  were  approximately  3,900  accounts  representing
approximately  20,000  shareholders  of  the  Company's  82,388,878  outstanding
shares.  Quarterly  dividends  paid for the years ended August 31, 1996 and 1995
are as follows:
<TABLE>
<CAPTION>

             Cash Dividends Per Share               1996                1995
             ---------------------------------------------------------------
             <S>                                 <C>                <C>   
             Quarter:
             First...........................    $   .20             $   .17
             Second..........................    $   .20             $   .17
             Third...........................    $   .20             $   .17
             Fourth..........................    $   .23             $   .20

</TABLE>

The stock of the Company became publicly traded in 1973 and quarterly  dividends
have been paid  continuously  since that time. It is anticipated  that dividends
will continue to be paid in the future.  The Company's  stock is included in the
Standard & Poors Composite Stock Price Index.


<PAGE>


                                   EXHIBIT 21


                       PIONEER HI-BRED INTERNATIONAL, INC.
                         SUBSIDIARIES OF THE REGISTRANT

The following are all of the subsidiaries of the Registrant, and are included in
its audited  consolidated  financial  statements filed with its Annual Report on
Form 10-K for the fiscal year ended August 31, 1996. Each  subsidiary  listed is
wholly-owned  by  the  Registrant  or  one  of  the  Registrant's  wholly  owned
subsidiaries, except as otherwise indicated.


                                                                   Place of
                      Subsidiary                                 Incorporation

Subsidiaries of the Registrant:
        The Advantage Corp.                                          USA
        Green Meadows, Ltd.                                          USA
        Hibridos Pioneer de Mexico S.A. de C.V. (1%)                 Mexico
        PHI Communications Company, Inc.                             USA
        PHI Financial Services, Inc.                                 USA
        PHI Insurance Co.                                            USA
        PHI Insurance Services, Inc.                                 USA
        PHI Mexico, S.A. de C.V. (99%)                               Mexico
        PHI Specialty Products                                       USA
        Pioneer Hi-Bred Australia, Pty. Ltd.                         Australia
        Pioneer Hi-Bred FSC Ltd. (0.45%)                             Jamaica
        Pioneer Hi-Bred Limited                                      Canada
        Pioneer Hi-Bred Production, Ltd.                             Canada
        Pioneer Hi-Bred Puerto Rico, Inc.                            USA
        Pioneer Overseas Corporation                                 USA
        Pioneer Sementes Ltda. (74.39%)                              Brazil
        Pioneer Vegetable Genetics, Inc.                             USA
        Semillas Pioneer Chile Ltda. (99.74%)                        Chile
        Semillas Pioneer, S.A.                                       Spain


<PAGE>


                                   EXHIBIT 21


                         SUBSIDIARIES OF THE REGISTRANT


                                                                    Place of
                      Subsidiary                                Incorporation

Subsidiaries of Pioneer Overseas  Corporation,  a wholly owned
  subsidiary of the Registrant:
        Agri-Genetic Realty, Inc. (30%)                           Philippines
        Grainfield Co., Ltd. (35%)                                Thailand
        Hibridos Pioneer de Mexicanos S.A. de C.V. (96%)          Mexico
        MISR Pioneer Seeds Company S.A.E. (80.39%)                Egypt
        P. T. Pioneer Hibrida Indonesia (80%)                     Indonesia
        PartAgri SARL (50%)                                       France
        PHI Genetics (Pty) Limited                                South Africa
        PHI Hi-Bred (Pty) Limited                                 South Africa
        PHI Seeds Proprietary Ltd. (99.99%)                       Botswana
        Pioneer Argentina, S.A.                                   Argentina
        Pioneer France Mais S.A. (99.44%)                         France
        Pioneer Genetique S.A.R.L. (99%)                          France
        Pioneer Hi-Bred Agricultural Technologies, Inc.           Philippines
        Pioneer Hi-Bred Europe, Inc.                              USA
        Pioneer Hi-Bred FSC Ltd. (99.55%)                         Jamaica
        Pioneer Hi-Bred Italia S.p.A. (90%)                       Italy
        Pioneer Hi-Bred Japan Co., Ltd. (52%)                     Japan
        Pioneer Hi-Bred Korea, Inc.                               USA
        Pioneer Hi-Bred Magyarorszag Kft. (90%)                   Hungary
        Pioneer Hi-Bred Northern Europe GmbH                      Germany
        Pioneer Hi-Bred S.A.R.L. (99.8%)                          France
        Pioneer Hi-Bred Seeds Agro S.R.L.                         Romania
        Pioneer Hi-Bred Seeds, Inc. JV (95%)                      Ethiopia
        Pioneer Hi-Bred Sementes de Portugal, S.A. (99.96%)       Portugal
        Pioneer Hi-Bred Thailand Co., Ltd. (94.5%)                Thailand
        Pioneer Overseas Corporation (Thailand) Ltd. (99.96%)     Thailand
        Pioneer Overseas Research Corporation                     USA
        Pioneer Pakistan Seed Limited (80%)                       Pakistan
        Pioneer Saaten GmbH                                       Austria
        Pioneer Seed Company (Zimbabwe) (Private) Limited (95%)   Zimbabwe
        Pioneer Seed Holding Nederland B.V.                       Netherlands
        Pioneer Seeds, Inc.                                       USA
        Pioneer Semena Holding GmbH (99%)                         Austria
        Pioneer Sementes Ltda. (25.61%)                           Brazil
        Pioneer Sjeme D.o.o. (10%)                                Croatia
        Pioneer Tohumculuk A.S. (99.98%)                          Turkey
        Pioneer Trading Ltd. (51%)                                Turks & Caicos
        Semillas Hibridas Pioneer S.A. (75%)                      Colombia
        Semillas Pioneer Chile Ltda. (0.26%)                      Chile
        Semillas Pioneer de Venezuela C.A.                        Venezuela
        SPIC PHI Seeds Inc. (40%)                                 India
        Swazi-American (PHI) Seeds, Ltd. (70%)                    Swaziland
        Ukranian-American Russian Zorya-Nasinnya (33.33%)         Ukraine


<PAGE>


                                   EXHIBIT 21


                         SUBSIDIARIES OF THE REGISTRANT


                                                                   Place of
                      Subsidiary                                 Incorporation

Subsidiaries of Green Meadows, Ltd., a wholly owned
  subsidiary of the Registrant:
        Green Meadows Development Board                              USA
        Hibridos Pioneer de Mexico S.A. de C.V. (1%)                 Mexico
        Iowa India Investments Company Ltd.                          USA
        PHI Mexico, S.A. de C.V. (1%)                                Mexico
        Pioneer France Mais S.A. (0.08%)                             France
        Village Court, Inc.                                          USA

Subsidiaries of PHI Insurance Services, Inc., a wholly-owned
  subsidiary of the Registrant:
        Hibridos Pioneer de Mexico S.A. de C.V. (1%)                 Mexico
        Pioneer Insurance Services, Inc. - An insurance Agency       USA

Subsidiary of Pioneer Genetique  S.A.R.L., a wholly owned subsidiary
  of Pioneer Overseas Corporation and Pioneer Seeds, Inc.:
        Pioneer France Mais S.A. (.08%)                              France

Subsidiaries of Pioneer Hi-Bred Europe, Inc., a wholly owned
  subsidiary  of Pioneer Overseas Corporation:
        Pioneer Hi-Bred Magyarorszag Kft. (10%)                      Hungary
        Pioneer Hi-Bred Sementes de Portugal S.A. (0.01%)            Portugal
        Pioneer Tohumculuk A.S. (0.01%)                              Turkey

Subsidiary of Pioneer Hi-Bred Korea, Inc., a wholly owned
  subsidiary of Pioneer Overseas Corporation:
        Pioneer Hi-Bred Sementes de Portugal S.A. (0.01%)            Portugal

Subsidiaries of Pioneer Hi-Bred Limited, a wholly owned
  subsidiary  of the Registrant:
        Pioneer France Mais S.A. (0.08%)                             France
        Pioneer Hi-Bred S.A.R.L. (0.20%)                             France

Subsididary of Pioneer Overseas Research Corporation, a wholly
  owned subsidiary of Pioneer Overseas Corporation:
        Pioneer Hi-Bred Sementes de Portugal S.A. (0.01%)            Portugal

Subsidiaries of Pioneer Seed Holding Nederland B.V., a wholly
  owned subsidiary of Pioneer Overseas Corporation:
        Hellaseed S.A. (51%)                                         Greece
        Pioneer France Mais S.A. (0.08%)                             France
        Pioneer Hi-Bred Slovakia S.R.O.                              Slovakia


<PAGE>


                                   EXHIBIT 21


                         SUBSIDIARIES OF THE REGISTRANT


                                                                     Place of
                      Subsidiary                                   Incorporation

Subsidiaries  of Pioneer  Seeds,  Inc.,  a wholly
  owned  subsidiary  of Pioneer Overseas Corporation:
        Hibridos Pioneer de Mexico S.A. de C.V. (1%)                 Mexico
        MISR Pioneer Seed Company S.A.E. (0.01%)                     Egypt
        P.T. Pioneer Hibrida Indonesia (20%)                         Indonesia
        PHI Seeds Proprietary Limited (0.01%)                        Botswana
        Pioneer France Mais S.A. (0.08%)                             France
        Pioneer Genetique S.A.R.L. (1%)                              France
        Pioneer Hi-Bred Italia S.p.A. (10%)                          Italy
        Pioneer Hi-Bred Sementes de Portugal S.A. (0.01%)            Portugal
        Pioneer Semena Holding GmbH (1%)                             Austria
        Pioneer Sjeme D.o.o. (90%)                                   Croatia
        Pioneer Tohumculuk A.S. (0.01%)                              Turkey


<PAGE>


                                   EXHIBIT 23


                         CONSENTS OF EXPERTS AND COUNSEL






                          INDEPENDENT AUDITORS' CONSENT




The Board of Directors
Pioneer Hi-Bred International, Inc.

We consent to  incorporation  by reference  in the  registration  statement  No.
333-08927  on Form S-8 of our report  dated  October 4,  1996,  relating  to the
consolidated  balance  sheets  of  Pioneer  Hi-Bred   International,   Inc.  and
subsidiaries  as of August  31,  1996 and  1995,  and the  related  consolidated
statements  of  earnings,  stockholders'  equity,  and cash  flows  and  related
schedule for each of the years in the  three-year  period ended August 31, 1996,
which  report  appears  in the August 31,  1996,  annual  report on Form 10-K of
Pioneer Hi-Bred International, Inc.


                                            /s/KPMG Peat Marwick LLP
                                            ------------------------
                                               KPMG Peat Marwick LLP

Des Moines, Iowa
November 22, 1996


<PAGE>

                                   EXHIBIT 27

                             FINANCIAL DATA SCHEDULE
                                    

ARTICLE                                    5
MULTIPLIER                              1,000,000

<TABLE>                                    
<S>                                         <C>
PERIOD-TYPE                             YEAR
FISCAL-YEAR-END                         AUG-31-1996
PERIOD-END                              AUG-31-1996
CASH                                              43
SECURITIES                                        56
RECEIVABLES                                      266
ALLOWANCES                                        23
INVENTORY                                        382
CURRENT-ASSETS                                   784
PP&E                                             985
DEPRECIATION                                     475
TOTAL-ASSETS                                    1422
CURRENT-LIABILITIES                              288
BONDS                                              0
PREFERRED-MANDATORY                                0
PREFERRED                                          0
COMMON                                            93
OTHER-SE                                         925
TOTAL-LIABILITY-AND-EQUITY                      1422
SALES                                           1721
TOTAL-REVENUES                                  1721
CGS                                              863
TOTAL-COSTS                                      863
OTHER-EXPENSES                                   511
LOSS-PROVISION                                     0
INTEREST-EXPENSE                                  11
INCOME-PRETAX                                    350
INCOME-TAX                                       127
INCOME-CONTINUING                                223
DISCONTINUED                                       0
EXTRAORDINARY                                      0
CHANGES                                            0
NET-INCOME                                       223
EPS-PRIMARY                                     2.68
EPS-DILUTED                                     2.68
</TABLE>
 
<PAGE>


                                   SIGNATURES


Pursuant to the  requirements of Section 13 or 15(d) of the Securities  Exchange
Act of 1934, the Registrant has duly caused this report or amendment  thereto to
be signed on its behalf by the undersigned, thereunto duly authorized.

(REGISTRANT)          PIONEER HI-BRED INTERNATIONAL, INC.


                                   /s/ Charles S. Johnson
                      ----------------------------------------------------------
(NAME AND TITLE)      Charles S. Johnson, President and Chief Executive Officer
                      and Director
DATE                  November 22, 1996

  Pursuant to the  requirements  of the  Securities  Exchange Act of 1934,  this
report  has  been  signed  below  by the  following  persons  on  behalf  of the
Registrant and in the capacities and on the dates indicated.


                                 /s/ Charles S. Johnson
                      ----------------------------------------------------------
(NAME AND TITLE)      Charles S. Johnson, President and Chief Executive Officer 
                      and Director
DATE                  November 22, 1996


                                 /s/ Thomas N. Urban
                      ----------------------------------------------------------
(NAME AND TITLE)      Thomas N. Urban, Chairman of the Board of Directors
DATE                  November 22, 1996


                                /s/ Jerry L. Chicoine
                      ----------------------------------------------------------
(NAME AND TITLE)      Jerry L. Chicoine, Senior Vice President, Chief Financial
                      Officer and Corporate Secretary to the Board
DATE                  November 22, 1996


                               /s/ Dwight G. Dollison
                      ----------------------------------------------------------
(NAME AND TITLE)      Dwight G. Dollison, Vice President and Treasurer
DATE                  November 22, 1996


                              /s/ Brian G. Hart
                      ----------------------------------------------------------
(NAME AND TITLE)      Brian G. Hart, Vice President and Corporate Controller
DATE                  November 22, 1996


                             /s/ C. Robert Brenton
                      ----------------------------------------------------------
(NAME AND TITLE)      C. Robert Brenton, Director
DATE                  November 22, 1996


                            /s/ Dr. Pedro Cuatrecasas
                      ----------------------------------------------------------
(NAME AND TITLE)      Dr. Pedro Cuatrecasas, Director
DATE                  November 22, 1996


<PAGE>




                             /s/ Dr. Ray A. Goldberg
                      ----------------------------------------------------------
(NAME AND TITLE)      Dr. Ray A. Goldberg, Director
DATE                  November 22, 1996


                            /s/ Fred S. Hubbell
                      ----------------------------------------------------------
(NAME AND TITLE)      Fred S. Hubbell, Director
DATE                  November 22, 1996


                            /s/ Dr. F. Warren McFarlan
                      ----------------------------------------------------------
(NAME AND TITLE)      Dr. F. Warren McFarlan, Director
DATE                  November 22, 1996


                           /s/ Dr. Owen J. Newlin
                      ----------------------------------------------------------
(NAME AND TITLE)      Dr. Owen J. Newlin, Director
DATE                  November 22, 1996


                           /s/ Dr. Virginia Walbot
                      ----------------------------------------------------------
(NAME AND TITLE)      Dr. Virginia Walbot, Director
DATE                  November 22, 1996


                           /s/ H. Scott Wallace
                      ----------------------------------------------------------
(NAME AND TITLE)      H. Scott Wallace, Director
DATE                  November 22, 1996


                           /s/ Fred W. Weitz
                      ----------------------------------------------------------
(NAME AND TITLE)      Fred W. Weitz, Director
DATE                  November 22, 1996


                           /s/ Herman H.F. Wijffels
                      ----------------------------------------------------------
(NAME AND TITLE)      Herman H.F. Wijffels, Director
DATE                  November 22, 1996


                          /s/ Nancy Y. Bekavac
                      ----------------------------------------------------------
(NAME AND TITLE)      Nancy Y. Bekavac, Director
DATE                  November 22, 1996


                          /s/ Luiz Kaufmann
                      ----------------------------------------------------------
(NAME AND TITLE)      Luiz Kaufmann, Director
DATE                  November 22, 1996