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                                                                    Exhibit 10.1

                            2002 STOCK INCENTIVE PLAN
                            (As amended May 15, 2003)

1. Purpose

     The 2002 Stock Incentive Plan (the "Plan"), effective June 17, 2002 is
established to encourage employees of Medco Health Solutions, Inc. (the
"Company"), its parent, if any, its subsidiaries, its affiliates and its joint
ventures to acquire Common Stock in the Company ("Common Stock"). It is believed
that the Plan will serve the interests of the Company and its stockholders
because it allows employees to have a greater personal financial interest in the
Company through ownership of, or the right to acquire its Common Stock, which in
turn will stimulate employees' efforts on the Company's behalf, and maintain and
strengthen their desire to remain with the Company. It is believed that the Plan
will also assist in the recruitment of employees.


2. Administration

     The Plan shall be administered by the Compensation Committee of the Board
of Directors of the Company (the "Committee"). A Director of the Company may
serve on the Committee only if he or she (i) is a "Non-Employee Director" for
purposes of Rule 16b-3 under the Securities Exchange Act of 1934, as amended
(the "Exchange Act"), and (ii) satisfies the requirements of an "outside
director" for purposes of Section 162(m) of the Internal Revenue Code (the
"Code"). The Committee shall be responsible for the administration of the Plan
including, without limitation, determining which Eligible Persons receive
Incentives, the types of Incentives they receive under the Plan, the number of
shares covered by Incentives granted under the Plan, and the other terms and
conditions of such Incentives. Determinations by the Committee under the Plan
including, without limitation, determinations of the Eligible Persons, the form,
amount and timing of Incentives, the terms and provisions of Incentives and the
writings evidencing Incentives, need not be uniform and may be made selectively
among Eligible Persons who receive, or are eligible to receive, Incentives
hereunder, whether or not such Eligible Persons are similarly situated.

     The Committee shall have the responsibility of construing and interpreting
the Plan, including the right to construe disputed or doubtful Plan provisions,
and of establishing, amending and construing such rules and regulations as it
may deem necessary or desirable for the proper administration of the Plan. Any
decision or action taken or to be taken by the Committee, arising out of or in
connection with the construction, administration, interpretation and effect of
the Plan and of its rules and regulations, shall, to the maximum extent
permitted by applicable law, be within its absolute discretion (except as
otherwise specifically provided herein) and shall be final, binding and
conclusive upon the Company, all Eligible Persons and any person claiming under
or through any Eligible Person.

     The Committee may delegate any or all of its power and authority hereunder
to the Chief Executive Officer or President and such other officers as the
Committee deems appropriate; provided, however, that the Committee may not
delegate its authority with regard to any matter or action affecting an officer
subject to Section 16 of the Exchange Act and that no such delegation shall be
made in the case of Incentives intended to be qualified under Section 162(m) of
the Code.

     For the purpose of this section and all subsequent sections, the Plan shall
be deemed to include this Plan and any comparable sub-plans established by
subsidiaries which, in the aggregate, shall constitute one Plan governed by the
terms set forth herein.

     Until such time as the Compensation Committee of the Board consists of
"Non-Employee Directors" and "outside directors" as provided herein, the Plan
shall be administered by the full Board of Directors of the

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Company. Any Incentives granted prior to (but including those that are effective
as of) the earlier of initial public offering of the Company's stock and the
date of the Company's full separation from Merck & Co., Inc. shall be subject to
approval of the full Board and the further approval of the Compensation and
Benefits Committee of the Board of Directors of Merck & Co., Inc.


3. Eligibility

     (a) Employees. Any person employed by the Company, its parent, if any, or
its subsidiaries, its affiliates and its joint ventures, including officers,
whether or not directors of the Company, and employees of a joint venture
partner or affiliate of the Company who provide services to the joint venture
with such partner or affiliate (each such person, an "Employee"), shall be
eligible to participate in the Plan if designated by the Committee ("Eligible
Persons").

     (b) Non-employees. The term "Employee" shall not include a non-employee
director or a person hired as an independent contractor, leased employee or
consultant, provided, however, that the Committee may determine that any such
person is eligible to receive Incentives under the Plan (and, if such a
determination is made as to any such person, such person shall be an Eligible
Person under the Plan). Such person shall not participate in this Plan except to
the extent that the Committee so determines, even if such person is subsequently
determined to be an "employee" by any governmental or judicial authority.

     (c) No Right To Continued Employment. Nothing in the Plan shall interfere
with or limit in any way the right of the Company, its parent, its subsidiaries,
its affiliates or its joint ventures to terminate the employment of any
participant at any time, nor confer upon any participant the right to continue
in the employ of the Company, its parent, its subsidiaries, its affiliates or
its joint ventures. No Eligible Person shall have a right to receive an
Incentive or any other benefit under this Plan or having been granted an
Incentive or other benefit, to receive any additional Incentive or other
benefit. Neither the award of an Incentive nor any benefits arising under such
Incentives shall constitute an employment contract with the Company, its parent,
its subsidiaries, its affiliates or its joint ventures, and accordingly, this
Plan and the benefits hereunder may be terminated at any time in the sole and
exclusive discretion of the Company without giving rise to liability on the part
of the Company, its parent, its subsidiaries, its affiliates or its joint
ventures for severance. Except as may be otherwise specifically stated in any
other employee benefit plan, policy or program, neither any Incentive under this
Plan nor any amount realized from any such Incentive shall be treated as
compensation for any purposes of calculating an employee's benefit under any
such plan, policy or program.


4. Term of the Plan

     This Plan shall be effective as of the date of its adoption by the Board of
Directors of the Company, subject to the approval of the Plan by the affirmative
vote of the stockholders of the Company entitled to vote thereon at the time of
such approval. Such approval by the stockholders shall occur within 12 months of
the adoption of the Plan by the Board of Directors. No Incentive shall be
granted under the Plan after December 31, 2012, but the term and exercise of
Incentives granted theretofore may extend beyond that date.


5. Incentives

     (a)  Types of Incentives. Incentives under the Plan may be granted in any
          one or a combination of (i) Incentive Stock Options; (ii) Nonqualified
          Stock Options; (iii) Stock Appreciation Rights; (iv) Restricted Stock
          Grants, (v) Performance Shares, (vi) Share Awards and (vii) Phantom
          Stock Awards (Incentive Stock Options and Nonqualified Stock Options
          shall be referred to collectively as "Stock Options" and together with
          Restricted Stock Grants, Performance Shares, Share Awards and Phantom
          Stock Awards shall be referred to collectively as "Incentives"). All
          Incentives shall be


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          subject to the terms and conditions set forth herein and to such other
          terms and conditions as may be established by the Committee.

     (b)  No Repricing. Except as otherwise provided in Section 6(c), in no
          event will the Committee decrease the option price of a Stock Option
          or Stock Appreciation Right after the date of grant or cancel
          outstanding Stock Options or Stock Appreciation Rights and grant
          replacement Stock Options or Stock Appreciation Rights with a lower
          option price than that of the replaced Stock Options or Stock
          Appreciation Rights or other Incentives without first obtaining the
          approval of the holders of a majority of the shares of Common Stock
          who are present in person or by proxy at a meeting of the Company's
          shareholders and entitled to vote.


6. Shares Available for Incentives

     (a) Shares Available. Subject to the provisions of Section 6(c), the
maximum number of shares of Common Stock of the Company that may be issued under
the Plan is fifty-four million (54,000,000); provided, however, no more than ten
(10%) percent of the maximum shares available under the Plan may be issued
pursuant to Incentives other than Stock Options (as defined herein) and Stock
Appreciation Rights. This number includes the shares to be issued under the
stock option grants made under the Merck & Co., Inc. 2001 Incentive Stock Plan
that will be converted to options for shares of Common Stock of the Company (the
"Converted Options") as of the completion of the "Distribution" as defined in
the Master Separation and Distribution Agreement between the Company and Merck &
Co., Inc. dated        , 2003. Shares under this Plan may be delivered by the
Company from its authorized but unissued shares of Common Stock or from issued
and reacquired Common Stock held as treasury stock, or both. In no event shall
fractional shares of Common Stock be issued under the Plan. In addition to the
foregoing, the following shares of Common Stock related to Incentives under this
Plan may again be used for the grant of Incentives under the Plan:

          (1) Shares related to Incentives paid in cash;

          (2) Shares related to Incentives that expire, are forfeited or
     cancelled or terminate for any other reason without issuance of shares of
     Common Stock;

          (3) Shares that are tendered or withheld in payment of all or part of
     the option price of a Stock Option awarded under this Plan, or in
     satisfaction of withholding tax obligations arising under this Plan;

          (4) Shares that are reacquired with cash tendered in payment of the
     option price of a Stock Option awarded under this Plan or with moneys
     attributable to the tax deduction enjoyed by the Company upon the exercise
     or disqualifying disposition of Stock Options under this Plan after the
     date this Plan is approved by shareholders; and

          (5) Any shares of Common Stock issued in connection with Incentives
     that are assumed, converted or substituted as a result of the acquisition
     of another company by the Company or a combination of the Company with
     another company.

     (b) Limit on an Individual's Incentives. In any calendar year, no Eligible
Person may receive (i) Incentives covering more than two million (2,000,000)
shares of the Company's Common Stock (such number of shares shall be adjusted in
accordance with Section 6(c)), or (ii) any Incentive if such person owns more
than ten percent of the stock of the Company within the meaning of Section 422
of the Code, or (iii) any Incentive Stock Option, as defined in Section 422 of
the Code, which would result in such person receiving a grant of Incentive Stock
Options for stock that would have an aggregate fair market value in excess of
$100,000, determined as of the time that the Incentive Stock Option is granted,
that would be exercisable for the first time by such person during any calendar
year.

     (c) Adjustment of Shares. In the event of a reorganization,
recapitalization, stock split, stock dividend, combination of shares, merger,
consolidation, rights offering, spin off, split off, split up or other event
identified by the Committee, the Committee shall make such adjustments, if any,
as it may deem appropriate



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in (i) the number and kind of shares authorized for issuance under the Plan,
(ii) the number and kind of shares subject to outstanding Incentives, (iii) the
option price of Stock Options and (iv) the fair market value of Stock
Appreciation Rights, provided that fractions of a share will be rounded down to
the nearest whole share (other than for Incentive Stock Options). Any such
determination shall be final, binding and conclusive on all parties.


7. Stock Options

     The Committee may grant options qualifying as Incentive Stock Options as
defined in Section 422 of the Code, and options other than Incentive Stock
Options ("Nonqualified Options") (collectively "Stock Options"). Such Stock
Options shall be subject to the following terms and conditions and such other
terms and conditions as the Committee may prescribe:

          (a) Stock Option Price. The option price per share with respect to
     each Stock Option shall be determined by the Committee, but shall not be
     less than 100% of the fair market value of the Common Stock on the date the
     Stock Option is granted, as determined by the Committee. Unless the
     Committee determines otherwise, "fair market value" shall mean the average
     (mean) of the highest and lowest sales prices of a share of Common Stock,
     as reported on the New York Stock Exchange (or any other reporting system
     selected by the Committee, in its sole discretion) on the date as of which
     the determination is being made or, if no sale of shares of Common Stock is
     reported on this date, on the next preceding day on which there were sales
     of shares of Common Stock reported.

          (b) Period of Stock Option. The period of each Stock Option shall be
     fixed by the Committee, provided that the period for all Stock Options
     shall not exceed ten (10) years from the grant, provided further, however,
     that, in the event of the death of an Optionee prior to the expiration of a
     Non-Qualified Stock Option, such Non-Qualified Stock Option may, if the
     Committee so determines, be exercisable for up to eleven years from the
     date of the grant. The Committee may, subsequent to the granting of any
     Stock Option, extend the term thereof, but in no event shall the extended
     term exceed ten years from the original grant date.

          (c) Exercise of Stock Option and Payment Therefore. No shares shall be
     issued until full payment of the option price has been made. The option
     price may be paid in cash or, if the Committee determines, in shares of
     Common Stock or a combination of cash and shares of Common Stock. If the
     Committee approves the use of shares of Common Stock as a payment method,
     the Committee shall establish such conditions as it deems appropriate for
     the use of Common Stock to exercise a Stock Option. Stock Options awarded
     under the Plan shall be exercised through such procedure or program as the
     Committee may establish or define from time to time, which may include a
     designated broker that must be used in exercising such Stock Options. The
     Committee may establish rules and procedures to permit an optionholder to
     defer recognition of gain upon the exercise of a Stock Option.

          (d) First Exercisable Date. The Committee shall determine how and when
     shares covered by a Stock Option may be purchased. The Committee may
     establish waiting periods, the dates on which Stock Options become
     exercisable or "vested" and, subject to paragraph (b) of this section,
     exercise periods. The Committee may accelerate the exercisability of any
     Stock Option or portion thereof.

          (e) Termination of Employment. Unless determined otherwise by the
     Committee, upon the termination of a Stock Option grantee's employment (for
     any reason other than gross misconduct), Stock Option privileges shall be
     limited to the shares which were immediately exercisable at the date of
     such termination. The Committee, however, in its discretion, may provide
     that any Stock Options outstanding but not yet exercisable upon the
     termination of a Stock Option grantee's employment may become exercisable
     in accordance with a schedule determined by the Committee. Such Stock
     Option privileges


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     shall expire unless exercised within such period of time after the date of
     termination of employment as may be established by the Committee, but in no
     event later than the expiration date of the Stock Option. If the Committee
     decides to grant Incentives to a non-employee director or to an independent
     contractor, leased employee or consultant, the Committee shall determine at
     the time of grant the terms applicable in the event such person's
     relationship with the Company is terminated.

          (f) Termination Due to Misconduct. If a Stock Option grantee's
     employment is terminated for gross misconduct, as determined by the
     Company, all rights under the Stock Option shall expire upon the date of
     such termination.

          (g) Limits on Incentive Stock Options. Except as may otherwise be
     permitted by the Code, an Eligible Person may not receive a grant of
     Incentive Stock Options for stock that would have an aggregate fair market
     value in excess of $100,000 (or such other amount as the Internal Revenue
     Service may decide from time to time), determined as of the time that the
     Incentive Stock Option is granted, that would be exercisable for the first
     time by such person during any calendar year.


8. Stock Appreciation Rights

     The Committee may, in its discretion, grant a right to receive the
appreciation in the fair market value of shares of Common Stock ("Stock
Appreciation Right") either singly or in combination with an underlying Stock
Option granted hereunder. Such Stock Appreciation Right shall be subject to the
following terms and conditions and such other terms and conditions as the
Committee may prescribe:

          (a) Time and Period of Grant. If a Stock Appreciation Right is granted
     with respect to an underlying Stock Option, it may be granted at the time
     of the Stock Option grant or at any time thereafter but prior to the
     expiration of the Stock Option grant. If a Stock Appreciation Right is
     granted with respect to an underlying Stock Option, at the time the Stock
     Appreciation Right is granted the Committee may limit the exercise period
     for such Stock Appreciation Right, before and after which period no Stock
     Appreciation Right shall attach to the underlying Stock Option. In no event
     shall the exercise period for a Stock Appreciation Right granted with
     respect to an underlying Stock Option exceed the exercise period for such
     Stock Option. If a Stock Appreciation Right is granted without an
     underlying Stock Option, the period for exercise of the Stock Appreciation
     Right shall be set by the Committee.

          (b) Value of Stock Appreciation Right. If a Stock Appreciation Right
     is granted with respect to an underlying Stock Option, the grantee will be
     entitled to surrender the Stock Option which is then exercisable and
     receive in exchange therefor an amount equal to the excess of the fair
     market value of the Common Stock on the date the election to surrender is
     received by the Company in accordance with exercise procedures established
     by the Company over the Stock Option price multiplied by the number of
     shares covered by the Stock Option which is surrendered. If a Stock
     Appreciation Right is granted without an underlying Stock Option, the
     grantee will receive upon exercise of the Stock Appreciation Right an
     amount equal to the excess of the fair market value of the Common Stock on
     the date the election to surrender such Stock Appreciation Right is
     received by the Company in accordance with exercise procedures established
     by the Company over the fair market value of the Common Stock on the date
     of grant multiplied by the number of shares covered by the grant of the
     Stock Appreciation Right.

          (c) Payment of Stock Appreciation Right. Payment of a Stock
     Appreciation Right shall be in the form of shares of Common Stock, cash or
     any combination of shares and cash. The form of payment upon exercise of
     such a right shall be determined by the Committee either at the time of
     grant of the Stock Appreciation Right or at the time of exercise of the
     Stock Appreciation Right.


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9. Performance Share Awards

     The Committee may grant awards under which payment may be made in shares of
Common Stock, cash or any combination of shares and cash if the performance of
the Company or its parent or any subsidiary, division, affiliate or joint
venture of the Company selected by the Committee during the Award Period meets
certain goals established by the Committee ("Performance Share Awards"). Such
Performance Share Awards shall be subject to the following terms and conditions
and such other terms and conditions as the Committee may prescribe:

          (a) Award Period and Performance Goals. The Committee shall determine
     and include in a Performance Share Award grant the period of time for which
     a Performance Share Award is made ("Award Period"). The Committee shall
     also establish performance objectives ("Performance Goals") to be met by
     the Company, its parent, subsidiary, division, affiliate or joint venture
     of the Company during the Award Period as a condition to payment of the
     Performance Share Award. The Performance Goals may include any one or
     combination of the following Company measures, as interpreted by the
     Committee, which (to the extent applicable) will be determined in
     accordance with GAAP: (i) revenue (or any component of revenue); (ii)
     gross margin; (iii) net income; (iv) net earnings; (v) earnings per
     share; (vi) return on equity; (vii) free cash flow; (viii) cash flow per
     share; (ix) return on invested capital; (x) return on investments; (xi)
     return on assets; (xii) economic value added (or an equivalent metric, as
     determined by the Committee); (xiii) share performance; (xiv) total
     shareowner return; (xv) expenses; (xvi) EBITDA per adjusted prescription;
     or (xvii) working capital. Performance Measures may be measured before or
     after taking taxes into consideration, in the discretion of the Committee.
     The Performance Goals may include minimum and optimum objectives or a
     single set of objectives. In determining attainment of Performance Goals,
     the Committee will exclude unusual or infrequently occurring items, charges
     for restructurings (employee severance liabilities, asset impairment costs,
     and exit costs), discontinued operations, extraordinary items and the
     cumulative effect of changes in accounting treatment, and may determine no
     later than ninety (90) days after the commencement of any applicable Award
     Period to exclude other items, each determined in accordance with GAAP (to
     the extent applicable) and as identified in the financial statements, notes
     to the financial statements or discussion and analysis of management.

          (b) Payment of Performance Share Awards. The Committee shall establish
     the method of calculating the amount of payment to be made under a
     Performance Share Award if the Performance Goals are met, including the
     fixing of a maximum payment. The Performance Share Award shall be expressed
     in terms of shares of Common Stock and referred to as "Performance Shares."
     After the completion of an Award Period, the performance of the Company,
     its parent, subsidiary, division, affiliate or joint venture of the Company
     shall be measured against the Performance Goals, and the Committee shall
     determine, in accordance with the terms of such Performance Share Award,
     whether all, none or any portion of a Performance Share Award shall be
     paid. The Committee, in its discretion, may elect to make payment in shares
     of Common Stock, cash or a combination of shares and cash. Any cash payment
     shall be based on the fair market value of Performance Shares on, or as
     soon as practicable prior to, the date of payment.

          (c) Revision of Performance Goals. As to any Award not intended to
     constitute "performance-based compensation" under Section 162(m) of the
     Code, at any time prior to the end of an Award Period, the Committee may
     revise the Performance Goals and the computation of payment if unforeseen
     events occur which have a substantial effect on the performance of the
     Company, its parent, subsidiary, division, affiliate or joint venture of
     the Company and which, in the judgment of the Committee, make the
     application of the Performance Goals unfair unless a revision is made.

          (d) Requirement of Employment. A grantee of a Performance Share Award
     must remain in the employ of the Company, its parent, subsidiary, affiliate
     or joint venture until the completion of the Award Period in order to be
     entitled to payment under the Performance Share Award; provided that the



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     Committee may, in its discretion, provide for a full or partial payment
     where such an exception is deemed equitable. If the Committee decides to
     grant Incentives to a non-employee director or to an independent
     contractor, leased employee or consultant, the Committee shall determine at
     the time of grant the terms applicable in the event such person's
     relationship with the Company is terminated.

          (e) Dividends. The Committee may, in its discretion, at the time of
     the granting of a Performance Share Award, provide that any dividends
     declared on the Common Stock during the Award Period, and which would have
     been paid with respect to Performance Shares had they been owned by a
     grantee, be (i) paid to the grantee, or (ii) accumulated for the benefit of
     the grantee and used to increase the number of Performance Shares of the
     grantee.


10. Restricted Stock Grants

     The Committee may award shares of Common Stock to an Eligible Person, which
shares shall be subject to the following terms and conditions and such other
terms and conditions as the Committee may prescribe ("Restricted Stock Grant"):

          (a) Requirement of Employment. A grantee of a Restricted Stock Grant
     must remain in the employment of the Company during a period designated by
     the Committee ("Restriction Period") in order to retain the shares under
     the Restricted Stock Grant. If the grantee leaves the employment of the
     Company prior to the end of the Restriction Period, the Restricted Stock
     Grant shall terminate and the shares of Common Stock shall be returned
     immediately to the Company provided that the Committee may, at the time of
     the grant, provide for the employment restriction to lapse with respect to
     a portion or portions of the Restricted Stock Grant at different times
     during the Restriction Period. The Committee may, in its discretion, also
     provide for such complete or partial exceptions to the employment
     restriction as it deems equitable. If the Committee decides to grant
     Incentives to a non-employee director or to an independent contractor,
     leased employee or consultant, the Committee shall determine at the time of
     grant the terms applicable in the event such person's relationship with the
     Company is terminated.

          (b) Restrictions on Transfer and Legend on Stock Certificates. During
     the Restriction Period, the grantee may not sell, assign, transfer, pledge
     or otherwise dispose of the shares of Common Stock. Each certificate for
     shares of Common Stock issued hereunder shall contain a legend giving
     appropriate notice of the restrictions in the grant.

          (c) Escrow Agreement. The Committee may require the grantee to enter
     into an escrow agreement providing that the certificates representing the
     Restricted Stock Grant will remain in the physical custody of an escrow
     holder until all restrictions are removed or expire.

          (d) Lapse of Restrictions. All restrictions imposed under the
     Restricted Stock Grant shall lapse upon the expiration of the Restriction
     Period if the conditions as to employment set forth above have been met.
     The grantee shall then be entitled to have the legend removed from the
     certificates.

          (e) Dividends. The Committee shall, in its discretion, at the time of
     the Restricted Stock Grant, provide that any dividends declared on the
     Common Stock during the Restriction Period shall either be (i) paid to the
     grantee, or (ii) accumulated for the benefit of the grantee and paid to the
     grantee only after the expiration of the Restriction Period.

          (f) Performance Goals. The Committee may designate whether any
     Restricted Stock Grant is intended to be "performance-based compensation"
     as that term is used in Section 162(m) of the Code.




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     Any such Restricted Stock Grant designated to be "performance-based
     compensation" shall be conditioned on the achievement of one or more
     Performance Goals (as defined in Section 9(a)), to the extent required by
     Section 162(m).


11. Other Share-Based Awards

     (a) Share Awards. The Committee may grant an award of shares of common
stock (a "Share Award") to any Eligible Person on such terms and conditions as
the Committee may determine in its sole discretion. Share Awards may be made as
additional compensation for services rendered by the Eligible Person or may be
in lieu of cash or other compensation to which the Eligible Person is entitled
from the Company.

     (b) Phantom Stock Awards. The Committee may, in its discretion, grant a
right representing a number of hypothetical shares, including hypothetical
restricted shares or restricted stock units (a "Phantom Stock Award"), to any
Eligible Person on such terms and conditions, including whether payment of such
Phantom Stock Award will be in cash or shares, as the Committee may determine in
its sole discretion.


12. Transferability

     Each Incentive, other than Nonqualified Options, granted under the Plan
shall not be transferable or assignable other than by will or the laws of
descent and distribution and shall be exercisable during the grantee's lifetime
only by the grantee. Nonqualified Options shall not be transferable or
assignable by the recipient, and may not be made subject to execution,
attachment or similar procedures, other than by will or the laws of descent and
distribution or pursuant to a domestic relations order within the meaning of
Rule 16a-12 under the Exchange Act. Notwithstanding the foregoing, the
Committee, in its discretion, may adopt rules permitting the transfer, solely as
gifts during the grantee's lifetime, of Stock Options (other than Incentive
Stock Options) to members of a grantee's immediate family or to trusts or family
partnerships for the benefit of such immediate family members. For this purpose,
immediate family member means the grantee's spouse, parent, child, stepchild,
grandchild and the spouses of such family members. The terms of a Stock Option
shall be final, binding and conclusive upon the beneficiaries, executors,
administrators, heirs and successors of the grantee.


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13. Discontinuance or Amendment of the Plan

     The Board of Directors may discontinue the Plan at any time and may from
time to time amend or revise the terms of the Plan as permitted by applicable
statutes, except that it may not, without the consent of the grantees affected,
revoke or alter, in a manner unfavorable to the grantees of any Incentives
hereunder, any Incentives then outstanding, nor may the Board amend the Plan
without stockholder approval where the absence of such approval would cause the
Plan to fail to comply with Rule 16b-3 under the Exchange Act, or any other
requirement of applicable law or regulation.


14. No Limitation on Compensation

     Nothing in the Plan shall be construed to limit the right of the Company to
establish other plans or to pay compensation to its employees, in cash or
property, in a manner which is not expressly authorized under the Plan.


15. No Constraint on Corporate Action

     Nothing in the Plan shall be construed (i) to limit, impair or otherwise
affect the Company's right or power to make adjustments, reclassifications,
reorganizations or changes of its capital or business structure, or to merge or
consolidate, or dissolve, liquidate, sell or transfer all or any part of its
business or assets, or (ii) except as provided in Section 13, to limit the right
or power of the Company, its parent, or any subsidiary, affiliate or joint
venture to take any action which such entity deems to be necessary or
appropriate.


16. Withholding Taxes

     The Company shall be entitled to deduct from any payment under the Plan,
regardless of the form of such payment, the amount of all applicable income and
employment taxes required by law to be withheld with respect to such payment or
may require the Eligible Person to pay to it such tax prior to and as a
condition of the making of such payment. In accordance with any applicable
administrative guidelines it establishes, the Committee may allow an Eligible
Person to pay the amount of taxes required by law to be withheld from an
Incentive by withholding from any payment of Common Stock due as a result of
such Incentive, or by permitting the Eligible Person to deliver to the Company,
shares of Common Stock having a fair market value, as determined by the
Committee, equal to the amount of such required withholding taxes.


17. Compliance with Section 16

     With respect to Eligible Persons subject to Section 16 of the Exchange Act
("Section 16 Officers"), transactions under the Plan are intended to comply with
all applicable conditions of Rule 16b-3 or its successor under the Exchange Act.
To the extent that compliance with any Plan provision applicable solely to the
Section 16 Officers is not required in order to bring a transaction by such
Section 16 Officer into compliance with Rule 16b-3, it shall be deemed null and
void as to such transaction, to the extent permitted by law and deemed advisable
by the Committee and its delegees. To the extent any provision of the Plan or
action by the Plan administrators involving such Section 16 Officers is deemed
not to comply with an applicable condition of Rule 16b-3, it shall be deemed
null and void as to such Section 16 Officers, to the extent permitted by law and
deemed advisable by the Plan administrators.



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18. Use of Proceeds

     The proceeds received by the Company from the sale of stock under the Plan
shall be added to the general funds of the Company and shall be used for such
corporate purposes as the Board of Directors shall direct.


19. Change in Control

     The Committee shall have the authority to determine the effect of a Change
in Control (as hereinafter defined) on outstanding Incentives.

     A "Change in Control" shall mean the occurrence during the term of the
Plan, but following the completion of the "Distribution" (as defined in the
Master Separation and Distribution Agreement between the Company and Merck &
Co., Inc. dated         , 2003), of any one of the following events:

     (a)  An acquisition (other than directly from the Company) of any shares of
          Common Stock or other voting securities of the Company by any "Person"
          (for purposes of this Section only, as the term "person" is used for
          purposes of Section 13(d) or 14(d) of the Exchange Act), immediately
          after which such Person has "Beneficial Ownership" (within the meaning
          of Rule 13d-3 promulgated under the Exchange Act) of twenty percent
          (20%) or more of either (i) the then outstanding shares of Common
          Stock or (ii) the combined voting power of the Company's then
          outstanding voting securities entitled to vote for the election of
          directors (the "Voting Securities"); provided, however, in determining
          whether a Change in Control has occurred, shares of Common Stock or
          Voting Securities which are acquired in a "Non-Control Acquisition"
          (as hereinafter defined) shall not constitute an acquisition which
          would cause a Change in Control. A "Non-Control Acquisition" shall
          mean an acquisition by (i) an employee benefit plan (or a trust
          forming a part thereof) maintained by (A) the Company or (B) any
          corporation or other Person of which a majority of its voting power or
          its voting equity securities or equity interest is owned, directly or
          indirectly, by the Company (for purposes of this definition, a
          "Related Entity"), (ii) the Company or any Related Entity, or (iii)
          any Person in connection with a "Non-Control Transaction" (as
          hereinafter defined); or

     (b)  The individuals who, immediately following the Distribution, are
          members of the Board of Directors of the Company (the "Incumbent
          Board"), (i) cease for any reason to constitute at least a majority of
          the members of the Board of Directors of the Company, or (ii)
          following a Merger (as hereinafter defined), do not constitute at
          least a majority of the board of directors of (x) the Surviving
          Corporation (as hereinafter defined), if fifty percent (50%) or more
          of the combined voting power of the then outstanding voting securities
          of the Surviving Corporation is not Beneficially Owned, directly or
          indirectly by a Parent Corporation, or (y) if there is one or more
          Parent Corporations, the ultimate Parent Corporation (as hereinafter
          defined); provided, however, that if the election, or nomination for
          election by the Company's common stockholders, of any new director was
          approved by a vote of at least a majority of the Incumbent Board, such
          new director shall, for purposes of this Plan, be considered as a
          member of the Incumbent Board; provided, further, however, that no
          individual shall be considered a member of the Incumbent Board if such
          individual initially assumed office as a result of an actual or
          threatened solicitation of proxies or consents by or on behalf of a
          Person other than the Board of Directors of the Company (a "Proxy
          Contest"), including by reason of any agreement intended to avoid or
          settle any Proxy Contest; or


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     (c)  The consummation of:

         (i)   A merger, consolidation or reorganization with or into the
               Company or a direct or indirect subsidiary of the Company or in
               which securities of the Company are issued (a "Merger"), unless
               the Merger is a "Non-Control Transaction." A "Non-Control
               Transaction" shall mean:

         (A)   the stockholders of the Company immediately before such Merger
               own directly or indirectly immediately following the Merger at
               least fifty percent (50%) of the outstanding common stock and the
               combined voting power of the outstanding voting securities of (x)
               the corporation resulting from such Merger (the "Surviving
               Corporation"), if fifty percent (50%) or more of the combined
               voting power of the then outstanding voting securities of the
               Surviving Corporation is not Beneficially Owned, directly or
               indirectly by another corporation (a "Parent Corporation"), or
               (y) if there is one or more Parent Corporations, the ultimate
               Parent Corporation;

         (B)   the individuals who were members of the Incumbent Board
               immediately prior to the execution of the agreement providing for
               the Merger, constitute at least a majority of the members of the
               board of directors of, (x) the Surviving Corporation, if fifty
               percent (50%) or more of the combined voting power of the then
               outstanding voting securities of the Surviving Corporation is not
               Beneficially Owned, directly or indirectly by a Parent
               Corporation, or (y) if there is one or more Parent Corporations,
               the ultimate Parent Corporation; and

         (C)   no Person other than (1) the Company or another corporation that
               is a party to the agreement of Merger, (2) any Related Entity,
               or(3) any employee benefit plan (or any trust forming a part
               thereof) that, immediately prior to the Merger, was maintained by
               the Company or any Related Entity, or (4) any Person who,
               immediately prior to the Merger had Beneficial Ownership of
               twenty percent (20%) or more of the then outstanding shares of
               Common Stock or Voting Securities, has Beneficial Ownership,
               directly or indirectly, of twenty percent (20%) or more of the
               combined voting power of the outstanding voting securities or
               common stock of (x) the Surviving Corporation, if fifty percent
               (50%) or more of the combined voting power of the then
               outstanding voting securities of the Surviving Corporation is not
               Beneficially Owned, directly or indirectly by a Parent
               Corporation, or (y) if there is one or more Parent Corporations,
               the ultimate Parent Corporation.

         (ii)  A complete liquidation or dissolution of the Company; or

         (iii) The sale or other disposition of all or substantially all of the
               assets of the Company and its subsidiaries taken as a whole to
               any Person (other than a transfer to a Related Entity or under
               conditions that would constitute a Non-Control Transaction with
               the disposition of assets being regarded as a Merger for this
               purpose or the distribution to the Company's stockholders of the
               stock of a Related Entity or any other assets).

     Notwithstanding the foregoing, a Change in Control shall not be deemed to
occur solely because any Person (the "Subject Person") acquired Beneficial
Ownership of more than the permitted amount of the then outstanding shares of
Common Stock or Voting Securities as a result of the acquisition of shares of
Common Stock or Voting Securities by the Company which, by reducing the number
of shares of Common Stock or Voting Securities then outstanding, increases the
proportional number of shares Beneficially Owned by the Subject Persons;
provided, that if a Change in Control would occur (but for the operation of this
sentence) as a result of the acquisition of shares of Common Stock or Voting
Securities by the Company, and after such share acquisition by the Company, the
Subject Person becomes the Beneficial Owner of any additional shares of Common
Stock or Voting Securities which increases the percentage of the then
outstanding shares of Common Stock or Voting Securities Beneficially Owned by
the Subject Person, then a Change in Control shall occur.


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20. Governing Law

     The Plan, and all agreements hereunder, shall be construed in accordance
with and governed by the laws of the State of Delaware without giving effect to
the principles of conflicts of laws.


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