<PAGE>   1
                                                                    Exhibit 10.1

                              THE MONSANTO COMPANY

            NON-EMPLOYEE DIRECTOR EQUITY INCENTIVE COMPENSATION PLAN

                           (AS AMENDED MARCH 23, 2000)


     1. NAME OF PLAN. This plan shall be known as the "The Monsanto Company
Non-Employee Director Equity Incentive Compensation Plan" and is hereinafter
referred to as the "Plan."

     2. PURPOSES OF PLAN. The purposes of the Plan are to enable Monsanto
Company, a Delaware corporation (the "Company"), to retain qualified persons to
serve as Directors by providing for their compensation and permitting them to
elect to defer a portion thereof, and to further align the interests of
Directors with the interests of shareholders of the Company by providing them
with equity-based compensation.

     3. EFFECTIVE DATE AND TERM. The Plan shall be effective as of September 1,
1997 (the "Effective Date"). The Plan shall remain in effect until terminated by
action of the Board, or until all Participants have received all amounts to
which they are entitled hereunder, if earlier.

     4. DEFINITIONS. The following terms shall have the meanings set forth
below:

     "Annual Meeting" means an annual meeting of the shareholders of the
     Company.
<PAGE>   2
     "Annual Retainer Amount" has the meaning set forth in Section 6(a).

     "Beneficiaries" has the meaning set forth in Section 7(b)(iii).

     "Beneficiary Designation" has the meaning set forth in Section 7(b)(iii).

     "Board" means the Board of Directors of the Company.

     "Cash Account" has the meaning set forth in Section 7(a).

     The "Committee" means the committee that administers the Plan, as more
     fully defined in Section 12.

     "Common Stock" means the Company's common stock, par value $2.00 per share.

     The "Company" has the meaning set forth in Section 2.

     "Current Cash" has the meaning set forth in Section 6(a).

     "Deferral Account" means a bookkeeping account maintained by the Company
     for a Director representing the Director's interest in the stock units or
     cash credited to such account pursuant to Sections 6 and 7.

     "Deferred Cash" has the meaning set forth in Section 6(a).

     "Deferred Delivery Election" has the meaning set forth in Section 7(b)(i).

     "Deferred Stock" means shares of Common Stock credited to a Stock Unit
     Account pursuant to Section 6(d)(iii) and Section 7 and later delivered
     pursuant to Section 7.

     "Delivery Election" has the meaning set forth in Section 7(b)(i).

     "Director" means an individual who is a non-employee member of the Board.


                                      -2-
<PAGE>   3
     The "Dividend Equivalent" for a given dividend or distribution means a
     number of shares (or fractions of a share) of Common Stock having a Value,
     as of the date such Dividend Equivalent is credited to a Stock Unit
     Account, equal to the amount of cash, plus the fair market value on the
     date of distribution of any property, that is distributed with respect to
     one share of Common Stock pursuant to such dividend or distribution; such
     fair market value to be determined by the Committee in good faith.

     The "Effective Date" has the meaning set forth in Section 3.

     "Elective Amount" has the meaning set forth in Section 6(a).

     "Exchange Act" means the Securities Exchange Act of 1934.

     "Grant Date" has the meaning set forth in Section 6(b).

     "Immediate Payment Election" has the meaning set forth in Section 7(b)(i).

     The "Interest Rate" for a calendar year means the average Moody's Baa Bond
     Index Rate, as in effect from time to time.

     "IRA Election" means an election to receive distributions from a Deferral
     Account in annual installments beginning on the Starting Date, over a
     period of years equal to the life expectancy of the Participant or joint
     life expectancy of the Participant and his or her spouse (if any), as
     elected by the Participant, such life expectancy to be determined as of the
     Starting Date.

     "Keogh Election" means an election to receive distributions from a Deferral
     Account in annual installments beginning on the Starting Date, over a
     period of years equal to the life expectancy of the Participant or joint
     life expectancy of the Participant and his or her spouse (if any), as
     elected by the Participant, such


                                      -3-
<PAGE>   4
     life expectancy to be determined as of the Starting Date and redetermined
     as of each anniversary thereof.

     "Options" has the meaning set forth in Section 6(a).

     "Participant" has the meaning set forth in Section 5.

     "Periodic Election" has the meaning set forth in Section 6(a).

     "Plan" has the meaning set forth in Section 1.

     "Plan Year" means the period from the Effective Date through the day before
     the date of the Company's 1998 Annual Meeting and each subsequent period
     beginning on the date of an Annual Meeting and ending on the day before the
     date of the next Annual Meeting.

     "Required Option Amount" has the meaning set forth in Section 6(a).

     "Restricted Stock" means shares of Common Stock granted in accordance with
     Section 6(d)(ii).

     "Section" means a section of the Plan except where otherwise specifically
     indicated.

     "Single Sum Election" means an election to receive distributions under the
     Plan in a single payment on the Starting Date.

     "Starting Date" has the meaning set forth in Section 7(b)(i).

     "Stock Unit Account" has the meaning set forth in Section 7(a).

     "Tax Withholding Election" has the meaning set forth in Section 7(e).

     "Tax Withholding Percentage" has the meaning set forth in Section 7(e).

     "Term" means the term of years for which a Participant has been elected a
     Director.


                                      -4-
<PAGE>   5
     "Term Certain Election" means an election to receive distributions from a
     Deferral Account in annual installments over a specified number of years
     beginning on the Starting Date, provided, that in the case of a Stock Unit
     Account, such number of years may not exceed ten, and in the case of a Cash
     Account, such number of years may not exceed the Participant's life
     expectancy determined as of the Starting Date.

     The "Termination Date" for a Participant is the date his or her service as
     a Director terminates for any reason.

     The "Value" of a share of Common Stock as of a particular date shall mean
     the average (rounded to the nearest cent) of the means between the reported
     high and low sale prices of a share of Common Stock on the New York Stock
     Exchange Composite Tape (or, if the Common Stock is not listed on such
     exchange, on any other national securities exchange on which the Common
     Stock is listed) on that date or, if that date is not a trading day, on the
     most recent trading day preceding such date. If the Common Stock is not
     traded on any national securities exchange, the Value of the Common Stock
     shall be determined by the Committee in good faith.


     5. ELIGIBLE PARTICIPANTS. Each individual who is a Director on the
Effective Date or becomes a Director thereafter while the Plan is in effect
shall be a participant ("Participant") in the Plan. Notwithstanding the
foregoing, each person who becomes a Director pursuant to the merger
contemplated by the Agreement and Plan of Merger dated as of December 19, 1999
among Monsanto Company, MP Sub, Incorporated, and Pharmacia & Upjohn, Inc.
("PNU"), as amended (the "Merger"), who was a Director of PNU immediately prior
to the effective time of the Merger


                                      -5-
<PAGE>   6
shall not be a Participant in the Plan and shall, instead, continue to
participate in the Pharmacia & Upjohn Directors Equity Compensation and Deferral
Plan.

     6. DIRECTOR COMPENSATION. (a) GENERAL. In consideration for his or her
services as a Director, each Participant shall receive compensation having a
total annual value (the "Annual Retainer Amount") equal to $100,000 in the case
of a Participant who serves as the Chair of a committee of the Board and $90,000
for all other Participants (which amount shall be pro-rated for partial years,
as applicable); provided, that the Annual Retainer Amount for the Participants
listed on Schedule I hereto for the Terms indicated on Schedule I shall be
reduced as set forth on Schedule I to take account of the previously granted
restricted stock being earned by such Participants; and provided, further, that
the Board may specify different Annual Retainer Amounts from time to time. Such
compensation for each Term shall be provided as follows: (i) half of such
compensation (the "Required Option Amount") shall take the form of options to
purchase Common Stock ("Options"), as more fully set forth in Section 6(b); and
(ii) the other half of the Annual Retainer Amount (the "Elective Amount") shall
take the form of (A) additional Options, as more fully set forth in Section
6(b), (B) cash paid


                                      -6-
<PAGE>   7
currently ("Current Cash") or deferred cash ("Deferred Cash"), as more fully set
forth in Section 6(c), or (C) Restricted Stock or Deferred Stock, as more fully
set forth in Section 6(d), or a combination thereof. Each Participant shall be
provided with the opportunity, in accordance with procedures established by the
Committee from time to time, to make an election with respect to each Term
during which he or she is a Participant (a "Periodic Election") specifying what
percentages, in increments of one percentage point, of the Elective Amount for
such Term will be provided to the Participant in the form of Options, Current
Cash, Deferred Cash, Restricted Stock and Deferred Stock. Each Periodic Election
for a particular Term shall be filed with the Committee at least 30 days before
the beginning of such Term; provided, that the Periodic Elections for Terms
beginning before the Effective Date shall be made on or before November 20, 1997
(and such Periodic Elections shall relate only to the Annual Retainer Amounts
paid with respect to service after the Effective Date); and provided, further,
that, with respect to an individual who becomes a Participant after the
Effective Date, the Periodic Election for such Participant's first Term shall be
filed with the Committee no later than 30 days after the first day of such Term.
If a Participant fails to make a timely Periodic Election


                                      -7-
<PAGE>   8
with respect to any Term, he or she shall be deemed to have elected to receive
the entire Elective Amount in the form of Current Cash.

     (b) OPTIONS. (i) Each Participant shall be granted, for each of his or her
Terms ending after the Effective Date, Options having a value on the applicable
Grant Date (as defined below) determined by the Committee in accordance with the
Black-Scholes option valuation method, equal to the sum of (A) the Required
Option Amount for the Term and (B) the portion of the Elective Amount for the
Term that the Participant has elected to receive in the form of Options. The
effective date of each such grant (the "Grant Date") shall be the first day of
the applicable Term; provided, that in the case of the first grant to those
individuals who are Participants on the Effective Date, the Grant Date shall be
November 21, 1997. Each Option shall be evidenced by an agreement, shall have a
per-share exercise price equal to the Value of a share of Common Stock on the
Grant Date and shall have the other terms and conditions set forth below in this
Section 6(b).

     (ii) The Options granted to a Participant on a particular Grant Date shall
vest in installments on the last day of each Plan Year ending during the Term
for which they were


                                      -8-
<PAGE>   9
granted, pro rata based upon the percentage of the Term that is included in such
Plan Year, but in each case only if the Participant remains a Director on the
last day of such Plan Year; provided, that if a Participant's Termination Date
occurs other than on the last day of a Plan Year, a pro rata portion of the
installment of the Participant's then-unvested Options that would otherwise have
vested as of the last day of the Plan Year during which such Termination Date
occurs, based on the percentage of such Plan Year that occurs on or before such
Termination Date, shall instead vest on the Termination Date; and provided,
further, that the number of shares with respect to which Options vest on a
particular day shall be rounded to the nearest whole number of shares, if
necessary to avoid vesting with respect to a fractional share.

     (iii) Each Option that vests in accordance with the foregoing shall be
exercisable from and after the later of the date of such vesting and the first
anniversary of the Grant Date, through the earlier of (A) the tenth anniversary
of the Grant Date and (B) in the case of the Participant's death during or after
his or her service as a Director, the first anniversary of the date of death, in
the case of the Participant's removal from the Board before the end of any Term,
the Termination Date,


                                      -9-
<PAGE>   10
and in all other cases, the fifth anniversary of the Participant's Termination
Date. Any Options held by a Participant that have not become vested as of the
Participant's Termination Date shall terminate on the Termination Date.

     (iv) Subject to the limitations of this Section 6(b), Options may be
exercised, in whole or in part, by giving written notice of exercise to the
Company specifying the number of shares of Common Stock subject to the Option to
be purchased. Such notice shall be accompanied by payment in full of the
purchase price by certified or bank check or such other instrument as the
Company may accept. Payment, in full or in part, may also be made in the form of
unrestricted Common Stock already owned by the Participant, based on the Value
of the Common Stock on the date the Option is exercised; provided, that such
already owned shares have been held by the Participant for at least six months
at the time of exercise. Payment for any shares subject to a Stock Option may
also be made by delivering a properly executed exercise notice to the Company,
together with a copy of irrevocable instructions to a broker to deliver promptly
to the Company the amount of sale or loan proceeds necessary to pay the purchase
price. To facilitate the foregoing, the Company may enter into agreements for
coordinated procedures with one or more brokerage


                                      -10-
<PAGE>   11
firms. No shares of Common Stock shall be issued pursuant to the exercise of
Options until full payment therefor has been made.

     (v) No Option shall be transferable by the Participant other than by will
or by the laws of descent and distribution. All Options shall be exercisable,
subject to the terms of this Section 6(b), only by the Participant, the guardian
or legal representative of the Participant, or any person to whom such Option is
transferred pursuant to the preceding sentence, it being understood that
references to the Participant shall be deemed, where appropriate, to refer to
such guardian, legal representative or other transferee.

     (c) CASH. The portion, if any, of the Elective Amount for a particular Term
that the Participant elects to have paid in Current Cash shall be paid, and the
portion, if any, of the Elective Amount for a particular Term that the
Participant elects to have paid in Deferred Cash shall be credited to a Cash
Account maintained by the Company pursuant to Section 7 below, in each case in
installments on the last day of each Plan Year that ends during the Term for
which it is paid or credited (as applicable), pro rata based upon the percentage
of the Term that is included in such Plan Year, but in each case only if the
Participant re-


                                      -11-
<PAGE>   12
mains a Director on that day. If a Participant's Termination Date occurs other
than on the last day of a Plan Year, a pro rata portion of the installment of
any Current Cash and any Deferred Cash that would otherwise have been paid or
credited, as applicable, as of the last day of the Plan Year during which such
Termination Date occurs, based upon the percentage of such Plan Year that occurs
on or before such Termination Date, shall instead be paid or credited, as
applicable, on the Termination Date.

     (d) STOCK. (i) The portion, if any, of the Elective Amount for a particular
Term that the Participant elects to have provided in Restricted Stock, shall be
issued as of the first day of such Term in the name of the Participant in the
form of a number of shares of Common Stock having a Value, as of the first day
of such Term, equal to the amount of such portion. Such shares shall be
forfeitable and nontransferable, and shall be held in escrow for the
Participant, until they vest in accordance with the provisions of Section
6(d)(iii). Dividends and other distributions with respect to Restricted Stock
that has not yet vested as of the record date therefor shall be held in escrow,
and shall vest and be delivered, together with the related Restricted Stock.


                                      -12-
<PAGE>   13
     (ii) The portion, if any, of the Elective Amount for a particular Term that
the Participant elects to have provided in Deferred Stock shall be provided by
crediting to a Stock Unit Account maintained by the Company pursuant to Section
7, a number of stock units representing hypothetical shares of Common Stock
having a Value, as of the first day of such Term, equal to the amount of such
portion. Such Deferred Stock shall vest as set forth in Section 6(d)(iii).

     (iii) Any Restricted Stock and Deferred Stock provided to a Participant for
a particular Term shall vest in installments on the last day of each Plan Year
that ends during the Term for which they were granted, pro rata based upon the
percentage of the Term that is included in such Plan Year, but only if the
Participant remains a Director on such day; provided, that if a Participant's
Termination Date occurs other than on the last day of a Plan Year, a pro rata
portion of the installment of the Participant's then-unvested Restricted Stock
and Deferred Stock that would otherwise have vested as of the last day of the
Plan Year during which such Termination Date occurs, based on the percentage of
such Plan Year that occurs on or before such Termination Date, shall instead
vest on the Termination Date; and provided, further, that the number of shares
with respect to which


                                      -13-
<PAGE>   14
Restricted Stock and/or Deferred Stock vests on a particular day shall be
rounded to the nearest whole number of shares, if necessary to avoid vesting
with respect to a fractional share.

     (e) Notwithstanding any other provision of the Plan, each Participant shall
be permitted to make an election (a "Tax Withholding Election") in connection
with each Periodic Election to have a percentage of (i) the shares of Common
Stock delivered to him pursuant to the exercise of Options, (ii) any Restricted
Stock, and/or (iii) any Deferred Stock, as applicable, delivered in the form of
cash to enable him or her to pay the taxes due with respect thereto. If a
Participant makes a Tax Withholding Election with respect to Options, then as
and when such Options are exercised, a percentage of the Common Stock purchased
in such exercise, equal to the "Tax Withholding Percentage" (as defined below),
shall be withheld by the Company, and the Company shall instead pay to such
Participant any amount of cash equal to the Value, as of the date of exercise,
of the withheld Common Stock. If a Participant makes a Tax Withholding Election
with respect to Restricted Stock, then as and when such Restricted Stock vests,
a percentage of such Restricted Stock, equal to the Tax Withholding Percentage,
shall be withheld by the Company, and the Company shall instead pay to such
Participant an amount of cash equal to


                                      -14-
<PAGE>   15
the Value, as of the date of vesting, of the withheld Restricted Stock. If a
Participant makes a Tax Withholding Election with respect to Deferred Stock,
then as and when such Deferred Stock is delivered to the Participant (or the
Participant's Beneficiary) pursuant to Section 7, a percentage of such Deferred
Stock, equal to the Tax Withholding Percentage, shall be withheld by the
Company, and the Company shall instead pay to such Participant (or such
Beneficiary) an amount of cash equal to the Value, as of the date of delivery,
of the withheld Deferred Stock. The "Tax Withholding Percentage" means the
percentage of the value of the Common Stock, Restricted Stock or Deferred Stock,
as applicable, that would be required to be withheld by the Company under all
applicable federal, state, local and other tax laws, if the Participant were an
employee of the Company.

     7. (a) DEFERRAL ACCOUNTS. The Company shall maintain one or two Deferral
Accounts for each Participant who makes a Periodic Election to receive Deferred
Cash or Deferred Stock, consisting of a "Stock Unit Account" and/or a "Cash
Account," as applicable, and shall make credits thereto as provided in Section 6
and this Section 7. Whenever a dividend is paid or other distribution made with
respect to the Common Stock, each Stock Unit Account shall be credited with a
number of shares of Common Stock


                                      -15-
<PAGE>   16
having a Value, as of the date such dividend is paid or such distribution is
made, equal to (i) the number of stock units in such Stock Unit Account as of
the record date for such dividend or distribution multiplied by (ii) the
Dividend Equivalent for such dividend or other distribution. The shares so
credited with respect to Deferred Stock that has not vested as of the record
date for the dividend or distribution shall vest as and when such Deferred Stock
vests. Each Cash Account shall accrue interest on the balance therein at the
Interest Rate, to be credited and compounded monthly.

     (b) DELIVERY OF ACCOUNT BALANCES. (i) Each Participant shall be provided
the opportunity to elect, in accordance with procedures established by the
Committee, the manner in which his or her Deferral Account balances will be
distributed on or after his or her Termination Date (each such election, a
"Delivery Election"). A separate Delivery Election may be made with respect to
each amount of cash credited to a Cash Account pursuant to a single Periodic
Election and each amount of stock units credited to a Stock Unit Account
pursuant to a single Periodic Election. Each such Delivery Election may call for
delivery in a single sum or in installments on or beginning on the later of (i)
the Termination Date or (ii) the date which is six months


                                      -16-
<PAGE>   17
after the Delivery Election is made (an "Immediate Payment Election") or for
deferred delivery in a single sum or in installments (a "Deferred Delivery
Election") on or beginning on a specified date (in either case, the date on
which delivery is to be made or is to begin is referred to as the "Starting
Date"). The Starting Date for a Deferred Delivery Election must be on or after
the third anniversary of the Termination Date; provided, that in no event shall
the Starting Date for a Deferred Delivery Election be later than the later of
(i) the Participant's 73rd birthday and (ii) the third anniversary of the
Termination Date. Each Delivery Election shall specify whether it is a Single
Sum Election, a Term Certain Election, a Keogh Election, or an IRA Election;
provided, that Keogh Elections and IRA Elections may only be made in connection
with Deferred Delivery Elections made with respect to amounts credited to Cash
Accounts.

     (ii) The stock units in a Participant's Stock Unit Account and/or the cash
in a Participant's Cash Account, as applicable, shall be delivered on or
beginning on the Starting Date in accordance with the Participant's applicable
Delivery Elections. In the case of deliveries from a Stock Unit Account, except
as provided in Section 6(e), such delivery shall be made in the form of stock
representing a number of shares of Common


                                      -17-
<PAGE>   18
Stock equal to the number of stock units as and when they are to be delivered;
provided, that if the number of shares to be delivered on any particular date
included a fractional share, such number of shares shall be rounded down to the
nearest whole number, and if such delivery is the last to be made to the
Participant, the Company shall pay the Participant cash in an amount equal to
the Value of such fractional share on the date of delivery. If any such stock
units or cash are to be delivered after the Participant has died or become
legally incompetent, they shall be delivered to the Participant's Beneficiary or
legal guardian, as the case may be, in accordance with the foregoing; provided,
that if a Participant who has made a Keogh Election dies before beginning to
receive or receiving all of his or her distributions, the entire balance in his
or her Deferral Account to which such Keogh Election applies shall be
distributed to his or her Beneficiary immediately. References to a Participant
in this Plan shall be deemed to refer to the Participant's Beneficiary or legal
guardian, where appropriate.

     (iii) Participants shall be provided with the opportunity to designate, in
accordance with procedures to be established by the Committee, the person or
persons ("Beneficiaries") who will receive distributions of his or her interests
in


                                      -18-
<PAGE>   19
the Plan upon the death of the Participant (a "Beneficiary Designation"). Once
made, a Beneficiary Designation or Delivery Election may be superseded by
another Beneficiary Designation or Delivery Election (as applicable) or revoked
in writing by the Participant. However, in order for any initial or superseding
Delivery Election or revocation thereof to be valid, it must be received by the
Committee before the Participant's Termination Date, and it shall in any event
be subject to the approval of the Board or of a committee of the Board if the
Committee determines that such approval is required in order for such Delivery
Election and/or transactions resulting therefrom to be exempt under Rule 16b-3
under Section 16 of the Exchange Act. In the case of multiple Beneficiary
Designations, Delivery Elections and/or revocations by any Participant, the most
recent valid Beneficiary Designation, Delivery Election or revocation (as
applicable) in effect as of the date of death or Termination Date, as
applicable, shall be controlling. If a Participant does not have a valid
Beneficiary Designation in effect as of the date of his or her death, his or her
Beneficiary shall be his or her estate. If a Participant does not have a valid
Delivery Election in effect as of his or her Termination Date with respect to
any portion of his or her Cash Account or Stock Unit Account, he or she shall be


                                      -19-
<PAGE>   20
deemed to have made an Immediate Payment Election with respect to such portion.

     8. DELIVERY OF SHARES; VOTING AND OTHER RIGHTS. The shares delivered to a
Participant pursuant to Section 6 or 7 above shall be issued in the name of the
Participant, and the Participant shall be entitled to all rights of a
shareholder with respect to Common Stock for all such shares issued in his or
her name, including the right to vote the shares, and the Participant shall
receive all dividends and other distributions paid or made with respect thereto
from and after the date of such issuance, except as specifically provided in
Section 6(d)(i).

     9. GENERAL RESTRICTIONS. (a) Notwithstanding any other provision of the
Plan or agreements made pursuant thereto, the Company shall not be required to
issue or deliver any shares of Common Stock under the Plan prior to fulfillment
of all of the following conditions:

        (i) Listing or approval for listing upon official notice of issuance of
    such shares on the New York Stock Exchange, Inc., or such other securities
    exchange as may at the time be a market for the Common Stock;

        (ii) Any registration or other qualification of such shares under any
    state or federal law or regulation, or the maintaining in effect of any such
    registration or other qualification which the Committee shall, in its
    absolute


                                      -20-
<PAGE>   21
     discretion upon the advice of counsel, deem necessary or advisable; and

          (iii) Obtaining any other consent, approval, or permit from any state
     or federal governmental agency which the Committee shall, in its absolute
     discretion after receiving the advice of counsel, determine to be necessary
     or advisable.

     (b) Nothing contained in the Plan shall prevent the Company from adopting
other or additional compensation arrangements for the Participants.

     (c) Except as specifically provided in the Plan with respect to Beneficiary
Designations, no Participant or Beneficiary shall have the right to assign,
pledge or otherwise dispose of his or her interest in any Deferral Account, nor
shall the interest of a Participant or Beneficiary therein be subject to
garnishment, attachment, transfer by operations of law, or any legal process.

     (d) The Plan is intended to constitute an unfunded plan for incentive and
deferred compensation of Directors, and the rights of Directors with respect to
Deferral Accounts under the Plan shall be those of general creditors of the
Company. The Committee may authorize the creation of trusts or other
arrangements to meet the obligations created under the Plan to deliver Common
Stock or make payments, so long as the existence of such


                                      -21-
<PAGE>   22
trusts or other arrangements is consistent with the unfunded status of the Plan.

     10. NUMBER AND SOURCE OF SHARES AVAILABLE. Subject to adjustment pursuant
to Section 11, 500,000 shares of Common Stock may be issued under the Plan.
Shares of Common Stock issuable under the Plan shall be taken from treasury
shares of the Company or purchased on the open market. If any shares of
Restricted Stock or Deferred Stock are forfeited, or if any Option terminates
without having been exercised, the shares subject thereto shall again be
available under the Plan.

     11. CHANGE IN CAPITAL STRUCTURE; CHANGE OF CONTROL. (a) In the event that
there is, at any time after the Board adopts the Plan, any change in the Common
Stock by reason of any stock dividend, stock split, combination of shares,
exchange of shares, warrants or rights offering to purchase Common Stock at a
price below its fair market value, reclassification, recapitalization, merger,
consolidation, spin-off or other change in capitalization of the Company,
appropriate adjustment shall be made in the number and kind of shares or other
property subject to the Plan and the number and kind of shares or other property
held in the Stock Unit Accounts (taking into account whether any Dividend


                                      -22-
<PAGE>   23
Equivalent is credited to the Stock Unit Accounts in connection therewith), and
any other relevant provisions of the Plan by the Committee, whose determination
shall be binding and conclusive on all persons. Without limiting the generality
of the foregoing, the Committee shall, to the greatest extent possible, make
such adjustments so that Deferred Stock in Stock Unit Accounts under the Plan is
treated in the same manner as actual shares of Common Stock.

     (b) If the shares of Common Stock credited to the Stock Unit Accounts are
converted pursuant to this Section 11 into cash or another form of property,
references in the Plan to the Common Stock shall be deemed, where appropriate,
to refer to such cash or other form of property, with such other modifications
as may be required for the Plan to operate in accordance with its purposes.
Without limiting the generality of the foregoing, references to delivery of
certificates for shares of Common Stock shall be deemed to refer to delivery of
cash and the incidents of ownership of any other property held in the Stock Unit
Accounts.

     12. ADMINISTRATION; AMENDMENT. (a) The Plan shall be administered by a
committee consisting of the Chief Financial Of-


                                      -23-
<PAGE>   24
ficer, the General Counsel and the Corporate Vice President -- Human Resources
of the Company (or the holder of any successor officer position thereto) (the
"Committee"), which shall have full authority to construe and interpret the
Plan, to establish, amend and rescind rules and regulations relating to the
Plan, and to take all such actions and make all such determinations in
connection with the Plan as it may deem necessary or desirable, including
without limitation the determination of life expectancies and other assumptions
and information to be used in determining the effect of Delivery Elections.

     (b) The Board may from time to time make such amendments to the Plan as it
may deem proper and in the best interest of the Company, and it may terminate
the Plan at any time.

     13.  MISCELLANEOUS.  (a)  Nothing in the Plan shall be deemed to create any
obligation  on the part of the Board to nominate any Director for  reelection by
the Company's  shareholders or to limit the rights of the shareholders to remove
any Director.

     (b) The Company shall have the right to require, prior to the issuance or
delivery of any cash or shares of Common Stock pursuant to the Plan, that a
Director make arrangements satisfactory to the Committee for the withholding of
any taxes re-


                                      -24-
<PAGE>   25
quired by law to be withheld with respect to the issuance or delivery of such
cash or shares, including without limitation by the withholding of shares that
would otherwise be so issued or delivered, by withholding from any other payment
due to the Director, or by a cash payment to the Company by the Director.

     14. GOVERNING LAW. The Plan and all actions taken thereunder shall be
governed by and construed in accordance with the laws of the State of Delaware.


                                      -25-
<PAGE>   26
                              THE MONSANTO COMPANY
                   NON-EMPLOYEE DIRECTOR EQUITY INCENTIVE PLAN

                                   SCHEDULE I



As provided in Section 6(a) of the Plan, the Annual Retainer Amount for the
following Participants shall be reduced in the amounts set forth below to take
account of the previously granted restricted stock being earned by such
Participants:

<TABLE>
<CAPTION>
                                 Annual Retainer      for year(s) ending at
     Director                   Amount reduction      the Annual Meeting in
     --------                   ----------------      ---------------------
<S>                             <C>                   <C>
Robert M. Heyssel                   $10,000           1998

Gwendolyn S. King                   $10,000           1998

Philip Leder                        $10,000           1998 and 1999

John S. Reed                        $ 5,000           1998, 1999 and 2000

John E. Robson                      $ 5,000           1998, 1999, 2000 and 2001

William D. Ruckelshaus              $ 5,000           1998, 1999 and 2000
</TABLE>


                                      -26-