Document:

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                                                                   EXHIBIT 10.22

                              EMPLOYMENT AGREEMENT
                             (for James A. Wachholz)

      EMPLOYMENT AGREEMENT (this "Agreement") dated as of June 23, 2005 (the
"Effective Date"), by and between Molecular Insight Pharmaceuticals, Inc., a
Massachusetts corporation having its principal place of business at 160 Second
Street, Cambridge, Massachusetts 02142 (the "Employer"), and James A. Wachholz,
45 Constitution Drive, Southborough, Massachusetts 01772 (the "Employee").

                                   WITNESSETH:

      WHEREAS, the Employer is engaged in the business of developing and
marketing imaging pharmaceuticals which detect human disease; and

      WHEREAS, the Employee possesses the experience necessary in administration
and general and active supervision and direction of the daily operations of a
biopharmaceutical business in order to fulfill the responsibilities as Vice
President, Regulatory Affairs and Quality Assurance of the Employer; and

      WHEREAS, the Employer desires to employ the Employee, and the Employee
desires to be employed by the Employer, all in accordance with the terms and
provisions of this Agreement.

      NOW, THEREFORE, in consideration of the covenants and promises hereinafter
contained, and for other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the Employer and the Employee
represent, covenant and agree as follows:

      1. Employment. The Employer hereby employs the Employee to serve as Vice
President Regulatory Affairs and Quality Assurance of the Employer in accordance
with the terms and provisions of this Agreement, and the Employee hereby accepts
such employment with the Employer.

      2. Term. The term of this Agreement shall commence on the Effective Date
and shall continue until this Agreement is terminated as hereinafter provided.

      3. Compensation. As compensation for all services rendered by the Employee
to the Employer pursuant to this Agreement, the Employer shall pay to the
Employee the following amounts during the term of this Agreement:

            (a) Base Compensation. The Employer shall pay to the Employee base
compensation at no less than the rate set forth on Schedule A attached hereto
and herein incorporated by reference (the "Base Compensation"). The Base
Compensation shall be payable pursuant to the Employer's standard payroll
practices, except as otherwise noted on Schedule A. The Base Compensation shall
be reviewed by the compensation committee of the Board of the

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Employer annually and increases in the Base Compensation, if any, shall be
evidenced by the updating and initialing of Schedule A by both parties hereto.

            (b) Incentive Bonus. In addition to the Base Compensation, the
Employee shall be eligible to receive an annual fiscal year incentive bonus with
a maximum annual amount equal to fifty percent (50%) of the then current Base
Compensation (the "Incentive Bonus"). Payment of the Incentive Bonus shall be
subject to the discretion of the Board and will be based upon accomplishment of
goals provided to the Employee by the President and Chief Scientific Officer
from time to time and based upon the achievement of specific corporate
milestones. The Board may elect to award the Incentive Bonus to the Employee in
cash or in the Employer's capital stock (at its then-current fair market value).

            (c) Hiring Bonus. In addition to the Base Compensation, the Employee
will receive, once only, a hiring bonus of $55,000. The Employer acknowledges
that there is no obligation on the part of the Employee to repay this hiring
bonus. The Hiring Bonus shall be payable pursuant to the Employer's standard
payroll practices after the first day of the Employee's employment.

      4. Vacation and Employee Benefits.

            (a) Vacation. The Employee shall be entitled to paid vacation equal
to four weeks annually. Vacation shall be taken at such times so as not to
interfere with the proper operation of the Employer's business.

            (b) Benefits Generally. The Employee shall be entitled to receive
and participate in such employee benefits as the Employer shall from time to
time determine to provide to its executives generally.

      5. Stock Incentives.

            (a) Options. Pursuant to the provisions of the Company's 1997 Stock
Option Plan, as may be amended from time to time (the "Plan"), and subject to
the approval by the Employer's Board of Directors, the Employer will grant to
the Employee an option to purchase 250,000 shares of its Common Stock ($.01 par
value) (the "Optioned Shares") at an exercise price equal to the fair market
value of the Employer's Common Stock on the date of grant, which is currently
$0.20 per share. The Optioned Shares shall vest over a four year period in
accordance with and subject to all the terms and conditions of the Plan and a
separate stock option agreement. In the event of a Change of Control (as defined
below), all of the unvested Optioned Shares immediately shall vest, provided
that the Employee is still employed by the Employer on the date of such Change
of Control, or is then receiving a Severance Package. The Employee may be
eligible, subject to the determination of the Employer's Board of Directors, in
its sole discretion, to receive an accelerated vesting of 100,000 of the
aforesaid share options of the Employer's Common Stock upon the successful
achievement of performance goals to be mutually agreed to by the Employee and
the Employer.

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<PAGE>

            (b) Change of Control. For purposes of this Agreement "Change of
Control" shall mean the occurrence of one or more of the following events:

(i) any "person" (as such term is used in Sections 13(d) and 14(d)(2) of the
Securities Exchange Act of 1934, as amended (the "Exchange Act")) becomes a
"beneficial owner" (as such term is defined in Rule 13d-3 promulgated under the
Exchange Act) (other than the Employer, any trustee or other fiduciary holding
securities under an employee benefit plan of the Employer, or any corporation
owned, directly or indirectly, by the stockholders of the Employer, in
substantially the same proportions as their ownership of stock of the Employer),
or any or group of persons acting in concert becomes a beneficial owner,
directly or indirectly, of securities of the Employer, representing more than
fifty percent (50%) of the combined voting power or fully diluted equity
interest of the Employer's then outstanding equity securities, except as a
result of a financing transaction where all proceeds are received directly by
the Company that is not intended as a sale of the business of the Employer; or

(ii) the stockholders of the Employer approve a merger or consolidation of the
Employer with any other corporation or other entity, other than (A) a merger or
consolidation which would result in the equity securities of the Employer
outstanding immediately prior thereto continuing to represent (either by
remaining outstanding or by being converted into equity securities of the
surviving entity) fifty percent (50%) or more of the outstanding equity interest
of the Employer or such surviving entity outstanding immediately after such
merger or consolidation or (B) a merger or consolidation effected to implement a
recapitalization of the Employer (or similar transaction) in which no "person"
(as hereinabove defined) other than Employee acquires more than fifty percent
(50%) of the equity interest of the Employer's then outstanding securities; or

(iii) the stockholders of the Employer approve a plan of complete liquidation of
the Employer or an agreement for the sale or disposition by the Employer of all
or substantially all of the Employer's assets.

6. Description of Duties. During the term of this Agreement, the Employee shall
be the Vice President, Regulatory Affairs and Quality Assurance of the Employer
and shall:

            (a) devote on a full time basis all necessary time, best efforts,
professional skills, attention and energies to the fulfillment of the regulatory
and quality assurance duties customarily associated with such position and the
accomplishment of the goals provided by the Chairman and Chief Executive Officer
of the Employer to the Employee from time to time; and

            (b) act in accordance herewith, and in all accounts be responsible
and responsive to, the Board of Directors and Chairman and CEO of Employer.

      7. General Services. During the term of this Agreement, the Employee
shall:

            (a) observe the Employer's policies and standards of conduct, as
well as customary standards of business conduct, including any standards
prescribed by law or regulation;

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<PAGE>

            (b) perform his duties hereunder in a manner that preserves and
protects the Employer's business reputation; and

            (c) do all things and render such services as may be necessary or
beneficial in carrying out any of the foregoing.

      8. Non-Disclosure of Proprietary or Confidential Information and
Confidential Communications. For the purposes of this Section 8, the term
"Employer" shall include, and the protections granted the Employer hereunder
shall extend to, ATP Therapeutics, Inc., Biostream Therapeutics, Inc. (f/k/a
Zebra Pharmaceuticals, Inc.), and any other entities now or hereinafter
affiliated, acquired or created by the Employer. The Employee recognizes and
acknowledges that the marketing plans and business strategy, the particular
needs and application of such customers for diagnostic imaging techniques, the
Employer's proprietary computer software programs, trade secrets and any other
confidential and proprietary information concerning the business or affairs of
the Employer (including but not limited to marketing and business plans and
strategies, research protocols, procedures data, results, and cost information)
(hereinafter collectively referred to as the "Confidential Information")
constitute a valuable, proprietary, special and unique asset of the Employer's
business. The Employee further recognizes and acknowledges that any
communications, whether written, oral or otherwise, that the Employer or any of
the Employers employees has with the Employer's existing or prospective
customers and clients and affiliated research institutions and scientists
regarding the Employer's business are extremely confidential (hereinafter the
"Confidential Communications"). The term Confidential Information shall exclude
any information that has been made public through no fault of the Employee.

      The Employee shall not, for any reason whatsoever, during or after the
termination of his employment with the Employer, use, disclose or allow access
to, for his own benefit or for that of another, the Confidential Information or
the Confidential Communications (or any part thereof) to any person, firm,
corporation, association or other entity for any reason or for any purpose
whatsoever.

      In the event of a breach or threatened breach by the Employee of the
provisions of this Section, the Employer shall be entitled to an injunction
restraining the Employee from so using, disclosing or allowing access to, in
whole or in part, the Confidential Information and the Confidential
Communications or from rendering any services to any person, firm, corporation,
association or other entity to whom the Confidential Information or the
Confidential Communications, in whole or in part, have been disclosed or are
threatened to be disclosed. Nothing herein shall be construed as prohibiting the
Employer from pursuing any other remedies available to the Employer for such
breach or threatened breach, including, but not limited to, the recovery of
damages and reasonable attorneys' fees from the Employee. In the event that the
Employer seeks an injunction against the Employee and is unsuccessful, the
Employer will reimburse the Employee his attorney's fees and expenses.

      Upon termination of this Agreement by either party for any reason, the
Employee shall return to the Employer any of the Confidential Information,
Confidential Communications, charts, company literature, reports, Employer
credit cards or other proprietary materials of the

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Employer then in the Employee's possession and all other materials of the
Employer which the Board of Directors of the Employer requests the Employee to
so return.

      This Section shall in all respects survive any termination of this
Agreement and shall remain in full force and effect thereafter. In the event
that any provision of this Section 8 shall conflict with any term or condition
of any other confidentiality agreement between the Employer and the Employee,
then the more restrictive provision shall be deemed to apply in order to
accomplish the purposes of this Section 8 and such other agreements, that being
to protect the Employer's Confidential Information and Confidential
Communications.

      In the event of the Employee's breach of this Section 8, the Employee
shall immediately and irrevocably forfeit future payments under the Severance
Package as hereinafter defined in Section 15. Nothing in this paragraph shall be
construed to limit or cap the Employer's damages in the event of a breach of
this Section 8.

      9. Covenant Not to Compete; Non-solicitation of Employees and Customers.
For the purposes of this Section 9, the term "Employer" shall include, and the
protections granted the Employer hereunder shall extend to, ATP Therapeutics,
Inc., Biostream Therapeutics, Inc. (f/k/a Zebra Pharmaceuticals, Inc.), and any
other entities now or hereinafter affiliated, acquired or created by the
Employer. The Employee agrees that while employed by the Employer and for a
continuous period of one (1) year following the date of the termination of his
employment with the Employer either voluntarily without "Good Reason" or
involuntarily by the Company for "cause" (the "Restricted Period"), he shall not
(without the express prior written consent of the Board of Directors of the
Employer), directly or indirectly, compete with the Employer. In construing the
foregoing prohibition, the Employee shall be deemed to be competing with the
Employer if he shall become self-employed in, or accept employment with, consult
with, render services to or become associated with, own, manage, operate, join,
control, or participate in the ownership, management, operation, or control of,
or be connected in any material manner with, or directly or indirectly enter
into the employment of, or make a substantial investment in (other than as a
holder of not more than 3% of the total outstanding stock of a publicly held
company), any corporation, partnership, proprietorship or other type of business
organization or entity which engages in, any business (a "Competing Business")
involving the sale, distribution, development or research concerning diagnostic
molecular imaging of the myocardium or other lines of the Employer which
directly and materially competes with the product lines in or with which the
Employer is then currently involved.

      The Employee further agrees that, during his employment with the Employer
and during the Restricted Period, he shall not solicit any of the Employer's
employees, existing customers or prospective customers (of which the Employee is
then currently aware), affiliated research institutions or scientists, on behalf
of himself or any Competing Business.

      This Section 9 shall in all respects survive any termination of this
Agreement and shall remain in full force and effect during the Restricted
Period.

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      In the event of the Employee's breach of this Section 9 during the
Restricted Period, the Employee shall immediately and irrevocably forfeit future
payments to the Employee under the Severance Package as hereinafter defined in
Section 15.

      10. Assignment of Rights. Any and all information, data, inventions,
discoveries, materials, notebooks and other work product which the Employee
conceives, develops or acquires during his employment with the Employer, which
directly or indirectly relates to work performed for the Employer, shall be the
sole and exclusive property of the Employer. The Employee shall promptly execute
any and all documents necessary and take such further actions as the Employer
may deem necessary to assign any and all of the Employee's right, title and
interest in such property to the Employer.

      11. Intellectual Property. For the purposes of this Section 11, the term
"Employer" shall include, and the protections granted the Employer hereunder
shall extend to, ATP Therapeutics, Inc., Biostream Therapeutics, Inc. (f/k/a
Zebra Pharmaceuticals, Inc.), and any other entities now or hereinafter
affiliated, acquired or created by the Employer. During the Employee's
employment at the Employer, the Employee shall promptly assist with and execute
any and all applications, assignments or other documents which an officer or
director of the Employer shall deem necessary or useful in order to obtain and
maintain patent, trademark or other intellectual property protection for the
Employer's products or services. After the termination date of his employment
with the Employer, the Employee shall use reasonable efforts to assist the
Employer on intellectual property matters as they relate to his employment, and
the Employer shall reasonably compensate the Executive for his time and expense.

      12. Documents, Records, etc. All documents, records, data, apparatus,
equipment and other physical property, whether or not pertaining to Confidential
Information, which are furnished to the Employee by the Employer or are produced
by the Employee in connection with the Employee's employment will be and remain
the sole property of the Employer. The Employee will return to the Employer all
such materials and property as and when requested by the Employer. In any event,
and whether or not the Employer so specifically requests, the Employee will
return all such materials and property immediately upon termination of the
Employee's employment for any reason. The Employee will not retain any such
material or property or any copies thereof after such termination.

      13. Third-Party Agreements and Rights. The Employee hereby confirms that
he is not bound by the terms of any agreement with any previous employer or
other party which restricts in any way the Employee's use or disclosure of
information or the Employee's engagement in any business. The Employee
represents to the Employer that the Employee's execution of this Agreement, the
Employee's employment with the Employer and the performance of the Employee's
proposed duties for the Employer will not violate any obligations the Employee
may have to any such previous employer or other party. In the Employee's work
for the Employer, the Employee will not disclose or make use of any information
in violation of any agreements with or rights of any such previous employer or
other party, and the Employee will not bring to the premises of the Employer
any copies or other tangible embodiments of nonpublic information belonging to
or obtained from any such previous employer or other party.

                                       6
<PAGE>

      4. Restricted Activities. During the term of this Agreement, the Employee
shall not engage in any business activities or ventures outside of the business
activities of the Employer without the express prior written consent of the
Employer's Board; provided, however, that nothing in this Agreement shall be
construed as preventing the Employee from:

            (a) investing the Employee's assets in any company or other entity
in a manner not prohibited by Section 9 and in such form or manner as shall not
require any material activities on the Employee's part in connection with the
operations or affairs of the companies or other entities in which such
investments are made; or

            (b) engaging in religious, charitable or other community or
non-profit activities that do not impair the Employee's ability to fulfill the
Employee's duties and responsibilities under this Agreement.

      15. Termination.

            A. Termination Without Cause.

                  (a) Notwithstanding anything herein to the contrary, this
Agreement may be terminated by either the Employer (by act of its Board) or the
Employee, at any tune, without cause; provided, however, that the party desirous
of terminating this Agreement shall give the other party prior written notice of
such termination. In either event, the Employer may determine the Employee's
final day of employment hereunder. The date specified in any notice of
termination as the Employee's final day of employment shall be referred to
herein as the Termination Date.

                  (b) In the event that the Employer (by act of its Board)
terminates this Agreement without cause pursuant to this subsection (A) of
Section 15, or the Employee voluntarily resigns for Good Reason (defined below),
then the Employee shall be entitled to receive severance pay equal to the Base
Compensation rate as of the Termination Date in equal monthly installments for a
period of twelve (12) months (the "Post-Termination Period") from the
Termination Date (the "Severance Package"). The Employer also agrees to make
available to the Employee, as part of the Severance Package, continuation of
group health plan benefits to the extent authorized by and consistent with 29
U.S.C. Section 1161 et seq. (commonly known as "COBRA"), and any other benefits
the Employee is receiving as of the Termination Date with the cost if the
regular premium for such benefits shared in the same relative proportion by the
Employer and the Employee as in effect on the Termination Date.

                  (c) For purposes of this Agreement, "Good Reason" shall mean:

                        (i) a reduction of the Employee's salary or insurance
benefits other than a reduction approved by the Employee in writing; or

                        (ii) a significant change in the Employee's title,
responsibilities and/or duties which constitutes, when compared to the
Employee's title, responsibilities and/or duties as of the Effective Date, a
demotion; or

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<PAGE>

                        (iii) the relocation of the offices at which the
Employee is principally employed as of the Effective Date to a location more
than fifty (50) miles from such office, which relocation is not approved by the
Employee.

                  (d) In the event of the Employee's voluntary termination, then
the Employee shall, at the request of the CEO of the Employer, continue as an
employee of the Employer for an additional thirty (30) day period after the
Termination Date for the purpose of assisting the Employer in locating and
training a suitable replacement for the Employee. During such additional period,
the Employee shall be entitled to full compensation and benefits and the
Employee shall continue to be bound by all of the terms contained herein. Any
such extended term shall extend the Post-Termination Period by an equal number
of days.

            B. Termination With Cause.

                  (a) The Employer (by act of its Board, CEO or President) may
terminate this Agreement immediately for "cause" by giving written notice to the
Employee. As used herein, the term "cause" shall mean the Employee's: (i)
addiction to illegal drugs; (ii) willful failure or refusal to perform his
duties hereunder after written notice from the Company and a thirty (30) day
opportunity to cure; (iii) knowing acts of dishonesty which materially adversely
affect the Employer, (iv) indictment for a felony or crime involving moral
turpitude, fraud, embezzlement or misrepresentation. In the event that this
Agreement is terminated pursuant to this subsection (B), the Employee forfeits
and shall not be entitled to the Severance Package, or other benefits or bonus
of any kind whatsoever for any period after the Termination Date set forth in
the notice given by the Employer to the Employee.

            C. Disability.

                  (a) If the Employee shall be disabled so as to be unable to
perform the essential functions of the Employee's then existing position or
positions under this Agreement, the Employer may remove the Employee from any
responsibilities and/or reassign the Employee to another position with the
Employer during the period of such disability. If the period of disability
extends for more than six (6) months, the Employer may terminate the Employee's
employment without further liability on the part of the Employer, except that
the Employee shall be entitled to the Severance Package. The Employer may
elect, at its sole discretion, to purchase a disability insurance package for
the Employee. In the event that the Employer so elects to purchase a disability
insurance package and the Employee subsequently becomes entitled to payments of
the disability insurance benefit, any payments pursuant to the Severance
Package, as defined in this Section 15, or payments of salary by the Employer
will be reduced by the amount of the disability insurance benefit payments
received by the Employee.

                  (b) If any question shall arise as to whether during any
period the Employee is disabled so as to be unable to perform the essential
functions of the Employee's then existing position or positions, the Employee
may, and at the request of the Employer shall, submit to the Employer a
certification in reasonable detail by a physician selected by the Employer, to
whom the Employee or the Employee's guardian has no reasonable objection, as to
whether the

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<PAGE>

Employee is so disabled or how long such disability is expected to continue, and
such certification shall, for the purposes of this Agreement, be conclusive of
the issue. The Employee shall cooperate with any reasonable request of the
physician in connection with such certification. If such question shall arise
and the Employee shall fail to submit such certification, the Employer's
determination of such issue shall be binding on the Employee. Nothing in this
Section 15(c) shall be construed to waive the Employee's rights, if any, under
existing law including, without limitation, the Family and Medical Leave Act of
1993, 29 U.S.C. 2601, et seq. and the Americans with Disabilities Act, 42 U.S.C.
12101 et seq.

      D. Death or Retirement. The Employee's employment under this Agreement
will be deemed to have terminated without further liability on the part of the
Employer if the Employee dies or retires.

      E. Certain Termination Benefits. Unless otherwise specifically provided in
this Agreement or otherwise required by law, all compensation and benefits
payable to the Employee under this Agreement shall terminate on the date of
termination of the Employee's employment under this Agreement.

      F. No Right to Continuing Employment. The Employee agrees that nothing
contained in this Agreement shall be construed to give the Employee a right to
continuing employment beyond the Termination Date.

      16. Litigation and Regulatory Cooperation. During and after the Employee's
employment, the Employee shall cooperate fully with the Employer in the defense
or prosecution of any claims or actions now in existence or which may be brought
in the future against or on behalf of the Employer which relate to events or
occurrences that transpired while the Employee was employed by the Employer. The
Employee's full cooperation in connection with such claims or actions shall
include, but not be limited to, being available to meet with counsel to prepare
for discovery or trial and to act as a witness on behalf of the Employer at
mutually convenient times. During and after the Employee's employment, the
Employee also shall cooperate fully with the Employer in connection with any
investigation or review of any federal, state or local regulatory authority as
any such investigation or review relates to events or occurrences that
transpired while the Employee was employed by the Employer. The Employer shall
reimburse the Employee for any reasonable out-of-pocket expenses incurred in
connection with the Employee's performance of obligations pursuant to this
Section 16.

      17. Injunction. The Employee agrees that it would be difficult to measure
any damages caused to the Employer which might result from any breach by the
Employee of the promises set forth in Sections 8 or 9, and that in any event
money damages would be an inadequate remedy for any such breach. Accordingly,
the Employee agrees that if the Employee breaches, or proposes to breach,
Sections 8 or 9 of this Agreement, the Employer shall be entitled, in addition
to all other remedies that it may have, to an injunction or other appropriate
preliminary equitable relief to restrain any such breach without showing or
proving any actual damage to the Employer.

                                       9
<PAGE>

      18. No Assignment. The Employee acknowledges that the services to be
rendered by him pursuant to this Agreement are unique. Accordingly, the Employee
shall not assign any of his rights or delegate any of his duties or obligations
under this Agreement.

      19. Severability. Subject only to the reformation of time, geographical
and occupational limitations as set forth in Section 20 hereof, all of the terms
and provisions contained in this Agreement are severable and, in the event that
any portion or provision of this Agreement (including, without limitation, any
portion or provision of any section of this Agreement) shall to any extent be
deemed unenforceable or invalid by a court of competent jurisdiction, then the
remainder of this Agreement, or the application of such portion or provision in
circumstances other than those as to which it is so declared unenforceable or
invalid, shall not be affected thereby, and each portion and provision of this
Agreement shall be valid and enforceable to the fullest extent permitted by law.

      20. Reformation of Time Geographical and Occupational Limitations. In the
event that any provision in this Agreement is held to be unenforceable by a
court of competent jurisdiction because it exceeds the maximum time,
geographical or occupational limitations permitted by applicable law, then such
provision(s) shall be and hereby are reformed to the maximum time, geographical
and occupational limitations as may be permitted by applicable law.

      21. Intentionally Omitted.

      22. Massachusetts Law: Choice of Forum. This Agreement shall be governed,
construed and interpreted by, and in accordance with, the laws of the
Commonwealth of Massachusetts, without reference to its principles of conflicts
of laws. Any actions concerning enforcement of this Agreement or in any way
relating to the subject matter of this Agreement shall be litigated only in
Massachusetts state or federal courts of proper jurisdiction and venue. Each
party hereto expressly agrees to submit to such jurisdiction and venue for the
purposes of this Agreement. Notwithstanding the foregoing, the Employer may seek
to enforce the Employee's covenants described in Sections 8, 9 and 10 hereof in
any jurisdiction and venue in which the Employee then resides, breaches or
threatens to breach such covenants.

      23. Entire Agreement. This Agreement constitutes the entire agreement of
the parties hereto, and replaces all prior agreements, promises, representations
and understandings between the Employer and the Employee whatsoever concerning
the limited subject matter hereof (other than the Stock Plan and any related
Stock Option Agreement entered into between the Employer and the Employee).
There are no other agreements, conditions or representations, oral or written,
express or implied, which form the basis for this Agreement.

      24. Assignment; Successors and Assigns, Etc. Neither the Employer nor the
Employee may make any assignment of this Agreement or any interest herein, by
operation of law or otherwise, without the prior written consent of the other
party; provided, however, that the Employer may assign its rights under this
Agreement without the consent of the Employee in the event that the Employer
shall effect a reorganization, consolidate with or merge into any other
corporation, partnership, organization or other entity, or transfer all or
substantially all of its

                                       10
<PAGE>

properties or assets to any other corporation, partnership, organization or
other entity. This Agreement shall inure to the benefit of and be binding upon
the Employer and the Employee, their respective successors, executors,
administrators, heirs and permitted assigns.

      25. Modification. No waiver or modification of this Agreement or of any
covenant, condition, or limitation contained herein shall be valid unless in a
writing of subsequent date hereto and duly executed by the party to be charged
therewith.

      26. Section Headings. The section headings contained in this Agreement are
for convenience only, and shall in no manner be construed as part of this
Agreement.

      27. Waiver of Breach. The waiver by either party of a breach or violation
of any provision of this Agreement shall not operate as, or be construed to be,
a waiver of any subsequent breach thereof.

      28. Notices. Any and all notices required or permitted to be given under
this Agreement shall be sufficient if furnished in writing, sent by certified or
registered mail, return receipt requested to the party's address set forth in
the Prologue of this Agreement. Either party may furnish the other party with a
different address in writing pursuant to this Section 28.

      29. Counterparts. This Agreement may be executed in any number of
counterparts, each of which when so executed and delivered shall be taken to be
an original; but such counterparts shall together constitute one and the same
document.

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<PAGE>

      IN WITNESS WHEREOF, the parties have executed this Agreement on the day
and year here above first written.

MOLECULAR INSIGHT PHARMACEUTICALS, INC.

By: /s/ David S. Barlow
    -------------------
Name: David S. Barlow
Title: Chairman & CEO

/s/ James A. Wachholz
-----------------------
James A. Wachholz

                                       12
<PAGE>

                                   SCHEDULE A
            (As Amended from time to time pursuant to Paragraph 3(a))

                                Base Compensation

<TABLE>
<CAPTION>
Annual Rate of Base
Compensation                    Agreed to by Employee               Agreed to by Employee
------------                    ---------------------               ---------------------
<S>                             <C>                                 <C>
$225,000.00
</TABLE>

(Must be initialed by both parties each time amended to be effective.)

DSB

Exhibit A - Incentive Stock Option Grant

                                       13<PAGE>
                                                                    EXHIBIT 10.1

                              AMENDED AND RESTATED
      NEUROCRINE BIOSCIENCES, INC. NONQUALIFIED DEFERRED COMPENSATION PLAN

                            EFFECTIVE APRIL 26, 2005

                         AMENDED AS OF JANUARY 12, 2006
<PAGE>
                                TABLE OF CONTENTS

<TABLE>
<CAPTION>
                                                                                  Page
                                                                                  ----
<S>                                                                               <C>
PURPOSE.....................................................................        1

ARTICLE 1. DEFINITIONS......................................................        1

      1.1   "Account Balance"...............................................        1
      1.2   "Accounts"......................................................        1
      1.3   "Administrator".................................................        1
      1.4   "Annual Bonus"..................................................        1
      1.5   "Annual Company Contribution Amount"............................        2
      1.6   "Annual Company Matching Amount"................................        2
      1.7   "Annual Deferral Amount"........................................        2
      1.8   "Annual Installment Method".....................................        2
      1.9   "Base Annual Salary"............................................        2
      1.10  "Beneficiary"...................................................        2
      1.11  "Beneficiary Designation Form"..................................        2
      1.12  "Board".........................................................        2
      1.13  "Cause".........................................................        2
      1.14  "Change in Control".............................................        3
      1.15  "Change in Control Benefit".....................................        4
      1.16  "Claimant"......................................................        4
      1.17  "Code"..........................................................        4
      1.18  "Committee".....................................................        4
      1.19  "Company".......................................................        4
      1.20  "Company Contribution Account"..................................        4
      1.21  "Company Matching Account"......................................        5
      1.22  "Company Stock Measurement Fund"................................        5
      1.23  "Deduction Limitation"..........................................        5
      1.24  "Deferral Account"..............................................        5
      1.25  "Director"......................................................        5
      1.26  "Director Fees".................................................        5
      1.27  "Disability"....................................................        5
      1.28  "Disability Benefit"............................................        6
      1.29  "Election Form".................................................        6
      1.30  "Employee"......................................................        6
      1.31  "Employer(s)"...................................................        6
      1.32  "ERISA".........................................................        6
      1.33  "Exchange Act"..................................................        6
      1.34  "Excise Tax Limitation".........................................        6
      1.35  "Fixed Date Payout".............................................        6
      1.36  "Fixed Date Payout Account Balance".............................        6
      1.37  "Key Employee"..................................................        6
      1.38  "Measurement Fund"..............................................        6
      1.39  "Non-Employee Director".........................................        7
      1.40  "Participant"...................................................        7
      1.41  "Plan"..........................................................        7
      1.42  "Plan Year".....................................................        7
      1.43  "Post-December 31, 2004 Deferrals"..............................        7
      1.44  "Pre-Retirement Survivor Benefit"...............................        7
      1.45  "Retirement", "Retire(s)" or "Retired"..........................        7
      1.46  "Retirement Benefit"............................................        7
      1.47  "Rule 16b-3"....................................................        7
</TABLE>

                                      -i-
<PAGE>
<TABLE>
<S>                                                                               <C>
      1.48  "Securities Act"................................................        7
      1.49  "Stock".........................................................        7
      1.50  "Termination Benefit"...........................................        7
      1.51  "Termination of Employment".....................................        7
      1.52  "Trust".........................................................        8
      1.53  "Unforeseeable Financial Emergency".............................        8
      1.54  "Years of Service"..............................................        8

ARTICLE 2. SELECTION, ENROLLMENT, ELIGIBILITY...............................        8

      2.1   Selection by Administrator......................................        8
      2.2   Enrollment Requirements.........................................        8
      2.3   Eligibility; Commencement of Participation......................        8
      2.4   Termination of Participation and/or Deferrals...................        8

ARTICLE 3. DEFERRAL COMMITMENTS/COMPANY CONTRIBUTIONS/CREDITING/TAXES.......        9

      3.1   Election to Defer; Effect of Election Form......................        9
      3.2   Minimum Deferrals...............................................        9
      3.3   Maximum Deferral................................................       10
      3.4   Accounts; Crediting of Deferrals................................       10
      3.5   Vesting.........................................................       10
      3.6   Earnings Credits or Losses......................................       11
      3.7   Distributions...................................................       12

ARTICLE 4. DISTRIBUTIONS....................................................       12

      4.1   Fixed Date Payout...............................................       12
      4.2   Retirement Benefit..............................................       13
      4.3   Pre-Retirement Survivor Benefit.................................       14
      4.4   Termination Benefit.............................................       14
      4.5   Disability Benefit..............................................       14
      4.6   Change in Control Benefit.......................................       15

ARTICLE 5. UNFORESEEABLE FINANCIAL EMERGENCIES; WITHDRAWAL ELECTION.........       15

      5.1   Withdrawal Payout/Suspensions for Unforeseeable Financial
            Emergencies.....................................................       15
      5.2   Withdrawal Election.............................................       15

ARTICLE 6. BENEFICIARY DESIGNATION..........................................       16

      6.1   Beneficiary.....................................................       16
      6.2   Beneficiary Designation; Change.................................       16
      6.3   No Beneficiary Designation......................................       16
      6.4   Doubt as to Beneficiary.........................................       16
      6.5   Discharge of Obligations........................................       16

ARTICLE 7. LEAVE OF ABSENCE.................................................       16

      7.1   Paid Leave of Absence...........................................       16
      7.2   Unpaid Leave of Absence; Disability Leave.......................       16

ARTICLE 8. TERMINATION, AMENDMENT OR MODIFICATION...........................       17

      8.1   Termination.....................................................       17
      8.2   Amendment.......................................................       17
      8.3   Effect of Payment...............................................       18

ARTICLE 9. ADMINISTRATION...................................................       18
</TABLE>

                                      -ii-
<PAGE>
<TABLE>
<S>                                                                               <C>
      9.1   Administrator Duties............................................       18
      9.2   Binding Effect of Decisions.....................................       18
      9.3   Committee.......................................................       18
      9.4   Indemnification.................................................       18
      9.5   Employer Information............................................       19

ARTICLE 10. CLAIMS PROCEDURES...............................................       19

      10.1  Presentation of Claim...........................................       19
      10.2  Notification of Decision........................................       19
      10.3  Review of a Denied Claim........................................       19
      10.4  Decision on Review..............................................       20
      10.5  Designation.....................................................       20
      10.6  Arbitration.....................................................       20

ARTICLE 11. TRUST...........................................................       20

      11.1  Establishment of the Trust......................................       20
      11.2  Interrelationship of the Plan and the Trust.....................       21
      11.3  Investment of Trust Assets......................................       21
      11.4  Distributions From the Trust....................................       21

ARTICLE 12. PROVISIONS RELATING TO SECURITIES LAWS..........................       21

      12.1  Designation of Participants.....................................       21
      12.2  Action by Committee.............................................       21
      12.3  Compliance with Section 16......................................       21

ARTICLE 13. MISCELLANEOUS...................................................       21

      13.1  Status of Plan..................................................       21
      13.2  Unsecured General Creditor......................................       22
      13.3  Employer's Liability............................................       22
      13.4  Nonassignability................................................       22
      13.5  Tax Withholding.................................................       22
      13.6  Coordination with Other Benefits................................       23
      13.7  Compliance......................................................       23
      13.8  Not a Contract of Employment....................................       23
      13.9  Furnishing Information..........................................       23
      13.10 Governing Law...................................................       23
      13.11 Notice..........................................................       23
      13.12 Successors......................................................       24
      13.13 Spouse's Interest...............................................       24
      13.14 Validity........................................................       24
      13.15 Incompetent.....................................................       24
      13.16 Court Order.....................................................       24
      13.17 Distribution in the Event of Taxation...........................       24
      13.18 Insurance.......................................................       24
      13.19 Savings Clause..................................................       25
</TABLE>

                                     -iii-
<PAGE>
                              AMENDED AND RESTATED
                          NEUROCRINE BIOSCIENCES, INC.
                     NONQUALIFIED DEFERRED COMPENSATION PLAN

                            EFFECTIVE APRIL 26, 2005

                         AMENDED AS OF JANUARY 12, 2006

                                     PURPOSE

            Neurocrine Biosciences, Inc., a Delaware corporation (the "Company")
established, effective December 1, 1996, the Neurocrine Biosciences, Inc.
Nonqualified Deferred Compensation Plan, which plan was amended and restated
effective February 22, 2000 (the "Plan"), for the benefit of a select group of
management and highly compensated Employees and Directors who contribute
materially to the continued growth, development and future business success of
the Company and its subsidiaries, if any, that sponsor this Plan. This Plan
shall be unfunded for tax purposes and for purposes of Title I of ERISA. The
Company hereby amends and restates the Plan in its entirety effective January
__, 2005 as set forth herein.

            This Plan shall consist of two plans, one for the benefit of a
select group of management and highly compensated Employees of the Employers as
described in Sections 201(2), 301(a)(3) and 401(a)(1) of ERISA, and one for the
benefit of Non-Employee members of the boards of directors of any Employer. To
the extent required by law, the terms of this Plan applicable to Directors shall
also constitute a separate written plan document with its terms set forth in the
applicable portions of this Plan.

                                   ARTICLE 1.
                                   DEFINITIONS

            As used within this document, the following words and phrases have
the meanings described in this Article 1 unless a different meaning is required
by the context. Some of the words and phrases used in the Plan are not defined
in this Article 1, but for convenience, are defined as they are introduced into
the text. Words in the masculine gender shall be deemed to include the feminine
gender. Any headings used are included for ease of reference only and are not to
be construed so as to alter any of the terms of the Plan.

      1.1 "Account Balance" shall mean, with respect to a Participant, a credit
on the records of the Employer equal to the sum of (i) the Deferral Account
balance, (ii) the Company Contribution Account balance, and (iii) the Company
Matching Account balance. The Account Balance, and each other specified account
balance, shall be a bookkeeping entry only and shall be utilized solely as a
device for the measurement and determination of the amounts to be paid to a
Participant, or his or her designated Beneficiary, pursuant to this Plan.

      1.2 "Accounts" of a Participant shall mean, as the context indicates,
either or all of his or her Deferral Account, Company Contribution Account and
Company Matching Account.

      1.3 "Administrator" shall mean the Committee appointed pursuant to Article
8 to administer the Plan, or such other person or persons to whom the Committee
has delegated its duties pursuant to Article 8.

      1.4 "Annual Bonus" shall mean any cash compensation, in addition to Base
Annual Salary, relating to services performed during any calendar year, whether
or not paid in such calendar year or included on the Federal Income Tax Form W-2
for such calendar year, payable to a Participant as an Employee under any
Employer's annual bonus and cash incentive plans, excluding stock options and
restricted stock.

                                      -1-
<PAGE>
      1.5 "Annual Company Contribution Amount" shall mean, for any one Plan
Year, the amount determined in accordance with Section 3.4(b).

      1.6 "Annual Company Matching Amount" for any one Plan Year shall be the
amount determined in accordance with Section 3.4(c).

      1.7 "Annual Deferral Amount" shall mean that portion of a Participant's
Base Annual Salary, Annual Bonus and Director Fees that a Participant elects to
defer, and is deferred, in accordance with Article 3, for any one Plan Year. In
the event of a Participant's Retirement, Termination of Employment as a result
of his or her Disability or death or a Termination of Employment prior to the
end of a Plan Year, such year's Annual Deferral Amount shall be the actual
amount withheld prior to such event.

      1.8 "Annual Installment Method" shall be an annual installment payment
over the number of years selected by the Participant in accordance with this
Plan, which shall in no event exceed fifteen (15) years, calculated as follows:
The Account Balance of the Participant (or the Fixed Date Payout Account
Balance, in the event of a Fixed Date Payout) shall be calculated as of the
close of business three (3) business days prior to the last business day of the
year or the date of the Fixed Date Payout. The annual installment shall be
calculated by multiplying this balance by a fraction, the numerator of which is
one, and the denominator of which is the remaining number of annual payments due
the Participant. By way of example, if the Participant elects a ten (10) year
Annual Installment Method, the first payment shall be 1/10 of the Account
Balance (or the Fixed Date Payout Account Balance, in the event of a Fixed Date
Payout), calculated as described in this definition. The following year, the
payment shall be 1/9 of the Account Balance (or the Fixed Date Payout Account
Balance, in the event of a Fixed Date Payout), calculated as described in this
definition. Each annual installment shall be paid within sixty (60) days
following each anniversary of the day the distributions are scheduled to
commence.

      1.9 "Base Annual Salary" shall mean the annual cash compensation relating
to services performed during any calendar year, whether or not paid in such
calendar year or included on the Federal Income Tax Form W-2 for such calendar
year, excluding bonuses, commissions, overtime, fringe benefits, stock options,
relocation expenses, incentive payments, non-monetary awards, Director Fees and
other fees, automobile and other allowances paid to a Participant for employment
services rendered (whether or not such allowances are included in the Employee's
gross income). Base Annual Salary shall be calculated before reduction for
compensation voluntarily deferred or contributed by the Participant pursuant to
all qualified or non-qualified plans of any Employer and shall be calculated to
include amounts not otherwise included in the Participant's gross income under
Code Sections 125, 132(f), 402(e)(3), 402(h), or 403(b) pursuant to plans
established by any Employer; provided, however, that all such amounts will be
included in compensation only to the extent that, had there been no such plan,
the amount would have been payable in cash to the Employee.

      1.10 "Beneficiary" shall mean one or more persons, trusts, estates or
other entities, designated in accordance with Article 6, that are entitled to
receive benefits under this Plan upon the death of a Participant.

      1.11 "Beneficiary Designation Form" shall mean the form established from
time to time by the Administrator that a Participant completes, signs and
returns to the Administrator to designate one or more Beneficiaries.

      1.12 "Board" shall mean the board of directors of the Company.

      1.13 "Cause" shall mean, with respect to a Participant, the occurrence of
any of the following (in each case determined by the Participant's Employer (or
the Employer's Board of Directors, if the Participant is the Employer's Chief
Executive Officer)):

                                      -2-
<PAGE>
            (a) any intentional action or intentional failure to act by a
      Participant which was performed in bad faith and to the material detriment
      of the Participant's Employer;

            (b) Participant's intentional refusal or intentional failure to act
      in accordance with any lawful and proper direction or order of the Chief
      Executive Officer (or the Employer's Board of Directors, if the
      Participant is the Employer's Chief Executive Officer);

            (c) Participant's willful and habitual neglect of the duties of
      employment; or

            (d) Participant's conviction of a felony crime involving moral
      turpitude;

            provided, that in the event any of the foregoing events is capable
of being cured, the Employer (or the Employer's Board of Directors, if the
Participant is the Employer's Chief Executive Officer) shall provide written
notice to Participant describing the nature of such event and Participant shall
thereafter have ten (10) business days to cure such event.

      1.14 A "Change in Control" shall be deemed to occur if any of the
following events shall occur:

            (a) the Company is merged or consolidated or reorganized into or
      with another corporation or other legal person, and as a result of such
      merger, consolidation or reorganization less than fifty percent (50%) of
      the combined voting power of the then-outstanding securities of such
      surviving corporation or person immediately after such transaction are
      held in the aggregate by the holders of voting securities of the Company
      immediately prior to such transaction;

            (b) the Company sells all or substantially all of its assets or any
      other corporation or other legal person and thereafter less than fifty
      percent (50%) of the combined voting securities of the acquiring or
      consolidated entity are held in the aggregate by the holders of voting
      securities of the Company immediately prior to such sale;

            (c) there is a report filed on Schedule 13D or Schedule 14D-1 (or
      any successor schedule, form or report), each as promulgated pursuant to
      the Exchange Act, disclosing that any "person" (as such term is used in
      Sections 13(d)(3) and 14(d)(2) of the Exchange Act) has become the
      "beneficial owner" (as defined in Rule 13d-3 or any successor rule or
      regulation promulgated under the Exchange Act), directly or indirectly, of
      securities of the Company representing fifty percent (50%) or more of the
      combined voting power of the then-outstanding voting securities of the
      Company;

            (d) the Company shall file a report or proxy statement with the
      Securities and Exchange Commission pursuant to the Exchange Act disclosing
      in response to Item 1 of Form 8-X thereunder or Item 5(f) of Schedule 14A
      thereunder (or any successor schedule, form or report or item therein)
      that the change in control of the Company has or may have occurred or will
      or may occur in the future pursuant to any then-existing contract or
      transaction; or

            (e) during any period of two (2) consecutive years, individuals who
      at the beginning of any such period constitute the Directors of the
      Company cease for any reason to constitute at least a majority thereof
      unless the election or the nomination for election by the Company's
      shareholders of each Director of the Company first elected during such
      period was approved by a vote of at least two-thirds (2/3) of the
      Directors of the Company then still in office who were Directors of the
      Company at the beginning of such period;

            provided, that for purposes of distribution of Post-December 31,
2004 Deferrals under Section 4.6, "Change in Control" shall be limited to:

                                      -3-
<PAGE>
            (f) the acquisition by any one person, or more than one person
      acting as a group (within the meaning of Q&A-12(b) of Internal Revenue
      Service Notice 2005-1, of ownership of stock of the Company that, together
      with stock held by such person or group constitutes more than fifty
      percent (50%) of the total fair market value or total voting power of the
      stock of the Company; provided, however, that if any one person or more
      than one person acting as a group, is considered to own more than fifty
      percent (50%) of the total fair market value or total voting power of the
      stock of the Company, the acquisition of additional stock by the same
      person or persons is not considered to be a Change in Control. such
      foregoing definition of Change in Control shall be deemed amended to the
      extent necessary to comply with the provisions of Code Section 409A and
      any regulations promulgated thereunder.

            (g) Either (i) the acquisition by one person or more than one person
      acting as a group during the twelve (12) month period ending on the date
      of the most recent acquisition by such person or persons of ownership of
      stock of the Company possessing thirty-five percent (35%) or more of the
      total voting power of the stock of the Company or (ii) the replacement of
      a majority of the members of the Board during any twelve (12) month period
      by directors whose appointment or election is not endorsed by a majority
      of the members of the Company's Board prior to the date of the appointment
      or election; or

            (h) The acquisition by one person or more than one person acting as
      a group during the twelve (12) month period ending on the date of the most
      recent acquisition, assets from the Company that have a total gross fair
      market value equal to or more than forty percent (40%) of the total gross
      fair market value of all assets of the Company immediately before such
      acquisition or acquisitions. For this purpose, gross fair market value
      means the value of the assets of the Company, or the value of the assets
      being disposed of, determined without regard to any liabilities associated
      with such assets.

            Notwithstanding the foregoing, whether a Change in Control has
occurred for purposes of distributions of Post-December 31, 2004 Deferrals shall
be determined in accordance with Code Section 409A, Internal Revenue Service
Notice 2005-1 and any similar authority.

      1.15 "Change in Control Benefit" shall mean the benefit set forth in
Section 4.6.

      1.16 "Claimant" shall have the meaning set forth in Section 9.1.

      1.17 "Code" shall mean the Internal Revenue Code of 1986, as it may be
amended from time to time. Reference to a section of the Code shall include that
section and any comparable section or sections of any future legislation that
amends, supplements or supersedes such section.

      1.18 "Committee" shall mean the Compensation Committee of the Board or
another committee or subcommittee of the Board appointed to administer the Plan
pursuant to Article 8.

      1.19 "Company" shall mean Neurocrine Biosciences, Inc, a Delaware
corporation, and any successor to all or substantially all of the Company's
assets or business.

      1.20 "Company Contribution Account" shall mean (i) the sum of all of a
Participant's Annual Company Contribution Amounts, plus (ii) the hypothetical
deemed investment earnings and losses credited or charged in accordance with all
the applicable provisions of this Plan that relate to the Participant's Company
Contribution Account, less (iii) all distributions made to the Participant or
his or her Beneficiary pursuant to this Plan that relate to the Participant's
Company Contribution Account.

                                      -4-
<PAGE>
      1.21 "Company Matching Account" shall mean (i) the sum of all of a
Participant's Annual Company Matching Amounts, plus (ii) the hypothetical deemed
investment earnings and losses credited or charged in accordance with all the
applicable provisions of this Plan that relate to the Participant's Company
Matching Account, less (iii) all distributions made to the Participant or his or
her Beneficiary pursuant to this Plan that relate to the Participant's Company
Matching Account.

      1.22 "Company Stock Measurement Fund" shall mean the Measurement Fund
which shall be deemed invested in the Company's Stock. Participants will have no
rights as stockholders of the Company with respect to allocations made to their
Accounts which are deemed invested in the Company Stock Measurement Fund.

      1.23 "Deduction Limitation" shall mean the following described limitation
on a benefit that may otherwise be distributable pursuant to the provisions of
this Plan. Except as otherwise provided, this limitation shall be applied to all
distributions, other than distributions of Post-December 31, 2004 Deferrals,
that are "subject to the Deduction Limitation" under this Plan. If an Employer
determines in good faith that there is a reasonable likelihood that any
compensation paid to a Participant for a taxable year of the Employer would not
be deductible by the Employer solely by reason of the limitation under Code
Section 162(m), then to the extent deemed necessary by the Employer to ensure
that the entire amount of any distribution to the Participant pursuant to this
Plan is deductible, the Employer may defer all or any portion of a distribution
under this Plan, other than a distribution of Post-December 31, 2004 Deferrals.
Any amounts deferred pursuant to this limitation shall continue to be
credited/debited with additional amounts in accordance with Section 3.6 below.
The amounts so deferred and amounts credited thereon shall be distributed to the
Participant or his or her Beneficiary (in the event of the Participant's death)
at the earliest possible date, as determined by the Employer in good faith, on
which the deductibility of compensation paid or payable to the Participant for
the taxable year of the Employer during which the distribution is made will not
be limited by Section 162(m), or if earlier, the date that is twenty-four (24)
months following the date on which the distribution was first distributable to
the Participant pursuant to the provisions of this Plan.

      1.24 "Deferral Account" shall mean (i) the sum of all of a Participant's
Annual Deferral Amounts, plus (ii) the hypothetical deemed investment earnings
and losses credited or charged in accordance with all the applicable provisions
of this Plan that relate to the Participant's Deferral Account, less (iii) all
distributions made to the Participant or his or her Beneficiary pursuant to this
Plan that relate to his or her Deferral Account.

      1.25 "Director" shall mean any member of the board of directors of any
Employer.

      1.26 "Director Fees" shall mean the annual fees paid by any Employer,
including retainer fees and meetings fees, as compensation for serving on the
board of directors.

      1.27 "Disability" shall mean a mental or physical disability as determined
by the Administrator in accordance with standards and procedures similar to
those under the Company's broad-based regular long-term disability plan, if any.
At any time that the Company does not maintain such a long-term disability plan,
"Disability" shall mean the inability of a Participant, as determined by the
Administrator, substantially to perform such Participant's regular duties and
responsibilities due to a medically determinable physical or mental illness
which has lasted, or can reasonably be expected to last, for a period of six (6)
consecutive months, but only to the extent that such definition does not violate
the Americans with Disabilities Act. Notwithstanding the foregoing, for purposes
of distributions of Post-December 31, 2003 Deferrals under Section 4.5,
Disability shall be limited to any medically determinable mental or physical
impairment, which can be expected to result in death or to last for a continuous
period of not less than twelve (12) months, rendering a Participant (i) unable
to engage in any substantial gainful activity, or (ii) eligible to receive
income replacement benefits for a period of not less than three (3) months under
the Company's accident and health plan, if any.

                                      -5-
<PAGE>
      1.28 "Disability Benefit" shall mean the benefit set forth in Section 4.5.

      1.29 "Election Form" shall mean the form established from time to time by
the Administrator that a Participant completes, signs and returns to the
Administrator to make an election under the Plan.

      1.30 "Employee" shall mean a person who is an employee of any Employer.

      1.31 "Employer(s)" shall mean the Company and/or any of its subsidiaries
(now in existence or hereafter formed or acquired) that have been selected by
the Board to participate in the Plan and have adopted the Plan as a sponsor.

      1.32 "ERISA" shall mean the Employee Retirement Income Security Act of
1974, as it may be amended from time to time. Reference to a section of ERISA
shall include that section and any comparable section or sections of any future
legislation that amends, supplements or supersedes such section.

      1.33 "Exchange Act" shall mean the Securities Exchange Act of 1934, as
amended. Reference to a section of the Exchange Act shall include that section
and any comparable section or sections of any future legislation that amends,
supplements or supersedes such section.

      1.34 "Excise Tax Limitation" shall mean the following described limitation
on a benefit that may otherwise be distributable pursuant to the provisions of
this Plan. Except as otherwise provided, this limitation shall be applied to all
distributions that are "subject to the Excise Tax Limitation" under this Plan,
other than Post-December 31, 2004 Deferrals. If an Employer determines in good
faith that there is a reasonable likelihood that any distribution to be paid to
a Participant pursuant to this Plan (other than a distribution of Post-December
31, 2004 Deferrals) would not be deductible by the Employer solely because all
or a portion of the distribution would constitute an "excess parachute payment"
within the meaning of Code Section 280G, as determined consistent with the
proposed regulations issued by the Internal Revenue Service under Code Section
280G, then to the extent deemed necessary by the Employer to ensure that the
entire amount of any distribution to the Participant pursuant to this Plan is
deductible, the Employer may defer all or any portion of a distribution under
this Plan. Any amounts deferred pursuant to this limitation shall continue to be
credited/debited with additional amounts in accordance with Section 3.6 below.
The amounts so deferred and amounts credited thereon shall be distributed to the
Participant or his or her Beneficiary (in the event of the Participant's death)
at the earliest possible date, as determined by the Employer in good faith, on
which the deductibility of compensation paid or payable to the Participant for
the taxable year of the Employer during which the distribution is made will not
be limited or, if earlier, the date that is twenty-four (24) months following
the date on which the distribution was first distributable to the Participant
pursuant to the provisions of this Plan.

      1.35 "Fixed Date Payout" shall mean the payout set forth in Section 4.1.

      1.36 "Fixed Date Payout Account Balance" shall mean, with respect to a
Participant, a credit on the records of the Employer equal to the sum of (i) the
amount deferred by the Participant and/or Employer contributions made on his or
her behalf and with respect to which a Fixed Date Payout was elected, plus (ii)
amounts credited or debited in the manner provided in Section 3.6 on such
amount. The Fixed Date Payout Account Balance shall be a bookkeeping entry only
and shall be utilized solely as a device for the measurement and determination
of the amounts to be paid to a Participant, or his or her designated
Beneficiary, pursuant to this Plan.

      1.37 "Key Employee" shall mean any Employee who would qualify as a "key
employee" within the meaning of Code Section 416(i), without regard to Paragraph
5 thereof.

      1.38 "Measurement Fund" shall mean the investment fund or funds selected
by the Administrator from time to time.

                                      -6-
<PAGE>
      1.39 "Non-Employee Director" shall mean a Director who is not an Employee
of the Company.

      1.40 "Participant" shall mean any Employee or Director (i) who is selected
to participate in the Plan, (ii) who elects to participate in the Plan, (iii)
who signs an Election Form and a Beneficiary Designation Form, (iv) whose signed
Election Form and Beneficiary Designation Form are accepted by the
Administrator, and (v) who commences participation in the Plan. A spouse or
former spouse of a Participant shall not be treated as a Participant in the Plan
or have an account balance under the Plan, even if he or she has an interest in
the Participant's benefits under the Plan as a result of applicable law or
property settlements resulting from legal separation or divorce.

      1.41 "Plan" shall mean the Neurocrine Biosciences, Inc. 2005 Nonqualified
Deferred Compensation Plan, which shall be evidenced by this instrument, as
amended from time to time.

      1.42 "Plan Year" shall mean a period beginning on January 1 of each
calendar year and continuing through December 31 of such calendar year.

      1.43 "Post-December 31, 2004 Deferrals" means any portion of a
Participant's Accounts which as of December 31, 2004 were not earned and vested
within the meaning of Internal Revenue Service Notice 2005-1. Post-December 31,
2004 Deferrals shall be subject to Code Section 409A and any regulations
promulgated thereunder. Portions of a Participant's Account that were earned and
vested as of December 31, 2004 within the meaning of Internal Revenue Service
Notice 2005-1, together with any earnings on such amounts, shall not be
Post-December 31, 2004 Deferrals and shall not be subject to Code Section 409A
and any regulations promulgated thereunder.1.44 "Pre-Retirement Survivor
Benefit" shall mean the benefit set forth in Section 4.3.

      1.45 "Retirement", "Retire(s)" or "Retired" shall mean, with respect to an
Employee, severance from employment from all Employers, and with respect to a
Director who is not an Employee, severance of his or her directorships with all
Employers, for any reason other than a leave of absence, death or Disability on
or after the earlier of the attainment of (a) age sixty-five (65) or (b) age
fifty-five (55) with a minimum of ten (10) Years of Service. For purposes of
deferrals pursuant to deferral elections made after January 12, 2006,
"Retirement" shall mean, with respect to an Employee, severance from employment
from all Employers, and with respect to a Director who is not an Employee,
severance of his or her directorships with all Employers, for any reason other
than a leave of absence, death or Disability on or after the earlier of the
attainment of (a) age sixty-five (65) or (b) age fifty-five (55) with a minimum
of five (5) Years of Service. If a Participant is both an Employee and a
Director, Retirement shall not occur until he or she Retires as both an Employee
and a Director. Notwithstanding the foregoing, for purposes of distributions of
Post-December 31, 2004 Deferrals, "Retirement" shall be deemed to mean such
severance from employment and/or directorship as would otherwise constitute a
"separation from service" within the meaning of Code Section 409A(a)(2)(A)(i)
and any regulations promulgated thereunder.

      1.46 "Retirement Benefit" shall mean the benefit set forth in Section 4.2.

      1.47 "Rule 16b-3" shall mean that certain Rule 16b-3 under the Exchange
Act, as such Rule may be amended from time to time.

      1.48 "Securities Act" shall mean the Securities Act of 1933, as amended.

      1.49 "Stock" shall mean Neurocrine Biosciences, Inc. common stock.

      1.50 "Termination Benefit" shall mean the benefit set forth in Section
4.4.

                                      -7-
<PAGE>
      1.51 "Termination of Employment" shall mean the severing of employment
with all Employers, or service as a Director of all Employers, voluntarily or
involuntarily, for any reason other than Retirement, Disability, death or an
authorized leave of absence. If a Participant is both an Employee and a
Director, a Termination of Employment shall occur only upon the termination of
the last position held. Notwithstanding the foregoing, with respect to
distributions of Post-December 31, 2004 Deferrals "Termination of Employment"
shall be deemed to mean such terminations of employment and/or directorship as
would otherwise constitute a "separation from service" within the meaning of
Code Section 409A(a)(2)(A)(i) and any regulations promulgated thereunder.

      1.52 "Trust" shall mean one or more trusts established pursuant to that
certain Trust Agreement, dated as of ________, 2003, between the Company and the
trustee named therein, as amended from time to time.

      1.53 "Unforeseeable Financial Emergency" shall mean an unanticipated
emergency that is caused by an event beyond the control of the Participant that
would result in severe financial hardship to the Participant not covered by
insurance, liquidation of other assets (to the extent the liquidation itself
will not cause severe financial hardship or cessation of deferrals under this
Plan, resulting from (i) a sudden and unexpected illness or accident of the
Participant or a dependent (as defined in Section 152(a) of the Code) of the
Participant, (ii) a loss of the Participant's property due to casualty, or (iii)
such other extraordinary and unforeseeable circumstances arising as a result of
events beyond the control of the Participant, all as determined in the sole
discretion of the Administrator.

      1.54 "Years of Service" shall mean each twelve (12) month period during
which a Participant is employed by an Employer, whether or not continuous, and
including periods commencing prior to the effective date of this Plan; provided,
however, that in the case of a Participant whose employment with an Employer has
been interrupted by a period of twelve (12) consecutive months or more (a "Break
in Service"), his or her Years of Service prior to such Break in Service shall
be disregarded for any purpose under the Plan.

                                   ARTICLE 2.
                       SELECTION, ENROLLMENT, ELIGIBILITY

      2.1 Selection by Administrator. Participation in the Plan shall be limited
to a select group of management and highly compensated Employees and
Non-Employee Directors of the Employers, as determined by the Administrator in
its sole discretion. Subject to the requirements of Article 11, from that group,
the Administrator shall select, in its sole discretion, Employees and
Non-Employee Directors to participate in the Plan.

      2.2 Enrollment Requirements. As a condition to participation, each
selected Employee or Non-Employee Director shall complete, execute and return to
the Administrator an Election Form and a Beneficiary Designation Form. In
addition, the Administrator shall establish from time to time such other
enrollment requirements as it determines in its sole discretion are necessary.

      2.3 Eligibility; Commencement of Participation. Provided an Employee or
Non-Employee Director selected to participate in the Plan has met all enrollment
requirements set forth in this Plan and required by the Administrator, including
returning all required documents to the Administrator within the specified time
period, that Employee or Non-Employee Director shall commence participation in
the Plan on the day on which his or her Election Form first becomes effective or
the date on which a contribution is first credited to his or her Company
Contribution Account or Company Matching Account, whichever occurs first.

      2.4 Termination of Participation and/or Deferrals. If the Administrator
determines in good faith that a Participant no longer qualifies as a member of a
select group of management or highly compensated Employees, as membership in
such group is determined in accordance with Sections 201(2),

                                      -8-
<PAGE>
301(a)(3) and 401(a)(1) of ERISA, or as a Non-Employee Director, the
Administrator shall have the right, in its sole discretion, to (a) terminate any
deferral election the Participant has made for the remainder of the Plan Year in
which the Participant's membership status changes, (b) prevent the Participant
from making future deferral elections and/or (c) other than with respect to
Post-December 31, 2004 Deferrals, immediately distribute the Participant's then
Account Balance as a Termination Benefit and terminate the Participant's
participation in the Plan.

                                   ARTICLE 3.
          DEFERRAL COMMITMENTS/COMPANY CONTRIBUTIONS/CREDITING/TAXES

      3.1 Election to Defer; Effect of Election Form. Subject to the terms and
conditions set forth herein and such terms and conditions as the Administrator
may determine, Participants may elect to defer Base Annual Salary, Annual Bonus
and/or Director Fees by timely completing and delivering to the Administrator an
Election Form prior to the beginning of each Plan Year during such period as may
be established by the Administrator in its discretion for such elections. After
a Plan Year commences, such deferral election shall be irrevocable and shall
continue for the entire Plan Year and subsequent years unless otherwise provided
in this Plan; provided, however, that a deferral election shall terminate upon
the execution and timely submission of a newly completed Election Form during a
subsequent election period or Termination of Employment.

            (a) Base Annual Salary, Annual Bonus and/or Director Fees. Subject
      to any terms and conditions imposed by the Administrator, Participants may
      elect to defer, under the Plan, Base Annual Salary, Annual Bonus and/or
      Director Fees. For these elections to be valid with respect to deferrals
      of Base Annual Salary, Annual Bonus and/or Director Fees, the Election
      Form must be completed and signed by the Participant, timely delivered to
      the Administrator no later than December 31 of the year immediately
      preceding the Plan Year for which the deferral election is to be effective
      and accepted by the Administrator. If no such Election Form is timely
      delivered for a Plan Year, the Annual Deferral Amount shall be zero for
      that Plan Year.

            (b) Performance-based Compensation. Notwithstanding the foregoing
      and subject to any terms and conditions imposed by the Administrator, in
      the case of any performance-based compensation within the meaning of Code
      Section 409A(a)(4)(B)(iii) that is a Post-December 31, 2004 Deferral and
      deferrable under this Plan, which compensation is based on services
      performed for a period of at least twelve (12) months, Participants may
      elect to defer such compensation by timely completing and delivering to
      the Administrator an Election Form no later than six (6) months before the
      end of such service period during such period as may be established by the
      Administrator in its discretion for such elections.

            (c) First Plan Year. Notwithstanding the foregoing, in the case of
      the first Plan Year in which a Participant becomes eligible to participate
      in this Plan, elections may be made with respect to services to be
      performed subsequent to such election within thirty (30) days after the
      date the Participant becomes eligible to participate in this Plan.

            (d) Redeferral. A Participant may annually change his or her
      election to an allowable alternative payout method by submitting a new
      Election Form to the Administrator during such period as may be
      established by the Administrator in its discretion for such elections,
      provided, however, that such change shall not be given any effect until at
      least twelve (12) months after the date on which the new election is made
      and only if such new Election Form is submitted to and accepted by the
      Administrator in its sole discretion at least thirteen (13) months prior
      to the scheduled payout date of the distribution to be modified. The
      Election Form most recently accepted by the Administrator shall govern the
      payout of the Participant's benefits under the Plan.

      3.2 Minimum Deferrals.

                                      -9-
<PAGE>
            (a) Annual Minimum. For each Plan Year, the annual aggregate minimum
      deferral amount for each Participant is $5,000. If an election is made for
      less than such minimum amount, or if no election is made, the amount
      deferred shall be zero.

            (b) Short Plan Year. Notwithstanding the foregoing, if a Participant
      first becomes a Participant after the first day of a Plan Year the minimum
      Base Annual Salary deferral shall be an amount equal to the minimum set
      forth above, multiplied by a fraction, the numerator of which is the
      number of complete months remaining in the Plan Year and the denominator
      of which is twelve (12).

      3.3 Maximum Deferral. For each Plan Year, a Participant may elect to
defer, as his or her Annual Deferral Amount, up to one hundred percent (100%) of
his or her Base Annual Salary, Annual Bonus and/or Director Fees. A
Participant's Annual Deferral Amount may be automatically reduced if the
Administrator determines that such action is necessary to meet federal or state
tax withholding obligations.

      3.4 Accounts; Crediting of Deferrals. Solely for record keeping purposes,
the Administrator shall establish a Deferral Account, a Company Contribution
Account and a Company Matching Account for each Participant. A Participant's
Accounts shall be credited with the deferrals made by him or her or on his or
her behalf by his or her Employer under this Article 3 and shall be credited (or
charged, as the case may be) with the hypothetical or deemed investment earnings
and losses determined pursuant to Section 3.6, and charged with distributions
made to or with respect to him or her.

            (a) Annual Deferral Amounts. For each Plan Year, the Base Annual
      Salary portion of the Annual Deferral Amount shall be withheld and
      credited to the Participant's Deferral Account at the time of each
      regularly scheduled Base Annual Salary payroll in either the percentages
      or dollar amounts specified by the Participant in the Election Form, as
      adjusted from time to time for increases and decreases in Base Annual
      Salary. The Annual Bonus and/or Director Fees portion of the Annual
      Deferral Amount shall be withheld and credited to the Participant's
      Deferral Account at the time the Annual Bonus and/or Director Fees are or
      otherwise would be paid to the Participant, whether or not this occurs
      during the Plan Year itself.

            (b) Annual Company Contribution Amount. For each Plan Year, an
      Employer, in its sole discretion, may, but is not required to, credit any
      amount it desires to any Participant's Company Contribution Account under
      this Plan, which amount shall be for that Participant the Annual Company
      Contribution Amount for that Plan Year. The amount so credited to a
      Participant may be smaller or larger than the amount credited to any other
      Participant, and the amount credited to any Participant for a Plan Year
      may be zero, even though one or more other Participants receive an Annual
      Company Contribution Amount for that Plan Year. The Annual Company
      Contribution Amount, if any, shall be credited to Participants' Company
      Contribution Accounts on the date declared by the Employer.

            (c) Annual Company Matching Amount. For each Plan Year, an Employer,
      in its sole discretion, may, but is not required to, credit any amount it
      desires to any Participant's Company Matching Account under this Plan,
      which amount shall be for that Participant the Annual Company Matching
      Amount for that Plan Year. The amount so credited to a Participant may be
      smaller or larger than the amount credited to any other Participant, and
      the amount credited to any Participant for a Plan Year may be zero, even
      though one or more other Participants receive an Annual Company
      Contribution Amount for that Plan Year. The Annual Company Contribution
      Amount, if any, shall be credited to Participants' Company Matching
      Accounts on the date declared by the Employer.

      3.5 Vesting.

                                      -10-
<PAGE>
            (a) A Participant shall at all times be one hundred percent (100%)
      vested in his or her Deferral Account.

            (b) Employer contributions credited to a Participant's Company
      Contribution Account under Section 3.4(b) of the Plan or to a
      Participant's Company Matching Account under Section 3.4(c) of the Plan
      and any hypothetical or deemed investment earnings and losses attributable
      to these contributions shall become vested or nonforfeitable as determined
      by the Administrator from time to time. The vesting schedule may vary
      among Participants.

            (c) In addition, a Participant shall be one hundred percent (100%)
      vested in his or her Company Contribution Account and Company Matching
      Account, including any deemed investment earnings and losses attributable
      to these accounts, immediately prior to the effective date of a Change in
      Control, immediately upon his or her death and immediately upon his or her
      Termination of Employment as a result of Disability. In the event of a
      Participant's Termination of Employment, other than by reason of his or
      her death or Disability, prior to the date on which all Employer
      contributions in such Participant's Company Contribution Account and
      Company Matching Account have vested pursuant to this Section 3.5, the
      unvested portion of such Employer contributions shall be forfeited and no
      Employer or the Plan shall be liable for the payment of such unvested
      amounts under the Plan to such Participant. Any amounts credited to a
      Participant's Company Contribution Account and Company Matching Account by
      his or her Employer on his or her behalf which are forfeited by such
      Participant pursuant to the preceding sentence shall cease to be
      liabilities of the Employer or the Plan and such amounts shall be
      immediately debited from the Participant's Company Contribution Account
      and Company Matching Account and credited to such Employer.

      3.6 Earnings Credits or Losses. In accordance with, and subject to, the
rules and procedures that are established from time to time by the
Administrator, in its sole discretion, amounts shall be credited or debited to a
Participant's Account Balance in accordance with the following rules:

            (a) Election of Measurement Funds. A Participant, in connection with
      his or her initial deferral election in accordance with Section 3.1 above,
      shall elect, on the Election Form, one or more Measurement Fund(s) (as
      described in Section 3.6(c) below) to be used to determine the additional
      amounts to be credited (or charged, as the case may be) to his or her
      Account Balance, unless changed in accordance with the next sentence. The
      Participant may (but is not required to) elect, by submitting an Election
      Form to the Administrator that is accepted by the Administrator, to add or
      delete one or more Measurement Fund(s) to be used to determine the
      additional amounts to be credited (or charged, as the case may be) to his
      or her Account Balance, or to change the portion of his or her Account
      Balance allocated to each previously or newly elected Measurement Fund. If
      an election is made in accordance with the previous sentence, it shall
      become effective as soon as administratively practicable and shall
      continue thereafter until changed in accordance with the previous
      sentence. Changes may be made to allocations at any time during the Plan
      Year.

            (b) Proportionate Allocation. In making any election described in
      Section 3.6(a) above, the Participant shall specify on the Election Form,
      in increments of whole percentage points (1%), the percentage of his or
      her Account Balance to be allocated to a Measurement Fund (as if the
      Participant was making an investment in that Measurement Fund with that
      portion of his or her Account Balance).

                                      -11-
<PAGE>
            (c) Measurement Funds. The Administrator shall from time to time
      select types of Measurement Funds and specific Measurement Funds for
      deemed investment designation by Participants for the purpose of crediting
      or charging hypothetical or deemed investment earnings and losses to his
      or her Account Balance, including, without limitation, a Company Stock
      Measurement Fund. As necessary, the Administrator may, in its sole
      discretion, discontinue, substitute or add a Measurement Fund. The
      Administrator shall notify the Participants of the types of Measurement
      Funds and the specific Measurement Funds selected from time to time.

            (d) Crediting or Debiting Method. The performance of each elected
      Measurement Fund (either positive or negative) will be determined by the
      Administrator, in its sole discretion, based on the performance of the
      Measurement Funds themselves. A Participant's Account Balance shall be
      credited or debited as frequently as is administratively feasible, but no
      less often than monthly, based on the performance of each Measurement Fund
      selected by the Participant, as determined by the Administrator in its
      sole discretion.

            (e) No Actual Investment. Notwithstanding any other provision of
      this Plan that may be interpreted to the contrary, the Measurement Funds
      are to be used for measurement purposes only, and a Participant's election
      of any such Measurement Fund, the allocation to his or her Account Balance
      thereto, the calculation of additional amounts and the crediting or
      debiting of such amounts to a Participant's Account Balance shall not be
      considered or construed in any manner as an actual investment of his or
      her Account Balance in any such Measurement Fund. In the event that the
      Company or the Trustee (as that term is defined in the Trust), in its own
      discretion, decides to invest funds in any or all of the Measurement
      Funds, no Participant shall have any rights in or to such investments
      themselves. Without limiting the foregoing, a Participant's Account
      Balance shall at all times be a bookkeeping entry only and shall not
      represent any investment made on his or her behalf by the Employer or the
      Trust; the Participant shall at all times remain an unsecured creditor of
      the Employers. Any liability of an Employer to any Participant, former
      Participant, or Beneficiary with respect to a right to payment shall be
      based solely upon contractual obligations created by the Plan. The
      Company, the Board, the Administrator, any Employer and any individual or
      entity shall not be deemed to be a trustee of any amounts to be paid under
      the Plan. Nothing contained in the Plan, and no action taken pursuant to
      its provisions, shall create or be construed to create a trust of any
      kind, or a fiduciary relationship, between the Company and an Employer and
      a Participant, former Participant, Beneficiary or any other individual or
      entity. Neither the Company nor any Employer in any way guarantees any
      Participant's Account Balance against loss or depreciation, whether caused
      by poor investment performance, insolvency of a deemed investment or by
      any other event or occurrence. In no event shall any Employee, officer,
      Director or stockholder of the Company or any Employer be liable to any
      individual or entity on account of any claim arising by reason of the Plan
      provisions or any instrument or instruments implementing its provisions,
      or for the failure of any Participant, Beneficiary or other individual or
      entity to be entitled to any particular tax consequences with respect to
      the Plan or any credit or payment hereunder.

            (f) Company Contribution Accounts. Notwithstanding any other
      provision of this Plan to the contrary, Company Contribution Amounts may
      only be allocated to the Measurement Funds designated by the Administrator
      from time to time, in its sole discretion.

      3.7 Distributions. Any distribution with respect to a Participant's
Account Balance shall be charged to the appropriate account as of the date such
payment is made by the Employer or the trustee of the Trust which may be
established for the Plan.

                                   ARTICLE 4.
                                  DISTRIBUTIONS

      4.1 Fixed Date Payout.

                                      -12-
<PAGE>
            (a) Election of Fixed Date Payout. In connection with each Election
      Form, a Participant may irrevocably elect to receive a future "Fixed Date
      Payout" from the Plan of his or her vested Fixed Date Payout Account
      Balance. Subject to the Deduction Limitation and the other terms and
      conditions of this Plan, each Fixed Date Payout elected shall be paid out
      no earlier than five (5) years from January 1 of the Plan Year following
      the Plan Year in which the Annual Deferral Amount is actually deferred or
      the Employer contribution is actually credited to the Participant's
      account, but in no event later than the date on which the Participant
      reaches age seventy (70) (the "Earliest Fixed Date Payout Date"). By way
      of example, if a five (5) year Fixed Date Payout is elected for Annual
      Deferral Amounts that are deferred in the Plan Year commencing January 1,
      2003, the five (5) year Fixed Date Payout would become payable no earlier
      than January 1, 2009. A Participant shall elect on each Election Form on
      which a Fixed Date Payout is elected to receive the Fixed Date Payout
      Account Balance applicable to such election in a lump sum or pursuant to
      an Annual Installment Method over a period of up to fifteen (15) years. If
      a Participant does not elect to have his or her Fixed Date Payout Account
      Balance paid in accordance with the Annual Installment Method, then such
      benefit shall be payable in a lump sum. The lump sum payment shall be made
      no later than sixty (60) days after the last day of any Plan Year
      designated by the Participant that is after the Earliest Fixed Date Payout
      Date. Any payment made shall be subject to the Deduction Limitation.

            (b) Redeferrals. A Participant may modify the date on which any such
      Fixed Date Payout is to be paid or revoke a previous election with respect
      thereto by submitting a new Election Form; provided that any such
      modification or revocation shall not be given any effect until at least
      twelve (12) months after the date on which the new election is made and
      only if (i) such new Election Form is submitted to and accepted by the
      Administrator in its sole discretion at least thirteen (13) months prior
      to the scheduled payout date of the distribution to be modified or revoked
      and (ii) any new payout date designated in such form is at least five (5)
      years following the scheduled payout date of the distribution to be
      deferred.

            (c) Other Benefits Take Precedence Over Fixed Date. Should an event
      occur that triggers a benefit under Section 4.2, 4.3, 4.4, 4.5 or 4.6, any
      Fixed Date Payout Account Balance that is subject to a Fixed Date Payout
      election under Section 4.1 shall not be paid in accordance with Section
      4.1 but shall be paid in accordance with the other applicable Section.

      4.2 Retirement Benefit.

            (a) Retirement Benefit. A Participant who Retires shall receive, as
      a Retirement Benefit, his or her Account Balance. A Participant, in
      connection with his or her commencement of participation in the Plan,
      shall elect on an Election Form to receive the Retirement Benefit in a
      lump sum or pursuant to an Annual Installment Method over a period of up
      to fifteen (15) years. If a Participant does not make any election with
      respect to the payment of the Retirement Benefit, then such benefit shall
      be payable in a lump sum. The lump sum payment shall be made, or
      installment payments shall commence, no later than sixty (60) days after
      the date the Participant Retires. Any payment made (other than payment of
      a Post-December 31, 2004 Deferral) shall be subject to the Deduction
      Limitation.

            (b) Death Prior to Completion of Retirement Benefit. If a
      Participant dies after Retirement but before the Retirement Benefit is
      paid in full, the Participant's unpaid Retirement Benefit payments shall
      continue and shall be paid to the Participant's Beneficiary in a lump sum
      that is equal to the Participant's unpaid remaining vested Account Balance
      as of the date of the Participant's death; provided that payment of
      amounts that are Post-December 31, 2004 Deferrals shall continue to be
      made pursuant to the form elected in connection with the Participant's
      commencement of participation in the Plan on an Election Form. Any lump
      sum payment shall be made no later than sixty (60) days after the date of
      the Participant's death. Any payment made

                                      -13-
<PAGE>
      (other than payment of a Post-December 31, 2004 Deferral) shall be subject
      to the Deduction Limitation.

            (c) Key Employees. Notwithstanding any provision in Section 4.2(a)
      above, if a Participant is a Key Employee as of the date of his or her
      Retirement, solely with regard to Post-December 31, 2004 Deferrals, if
      any, the lump sum payment shall be made, or installment payments shall
      commence, no earlier than six (6) months after the date of the
      Participant's Retirement.

      4.3 Pre-Retirement Survivor Benefit. If a Participant dies before he or
she receives complete payment of benefits pursuant to this Article 4, such
Participant's Beneficiary shall receive a Pre-Retirement Survivor Benefit equal
to the Participant's vested Account Balance as of the date of the Participant's
death (after giving effect to any accelerated vesting as a result of the
Participant's death pursuant to Section 3.5). The Pre-Retirement Survivor
Benefit shall be paid to the Participant's Beneficiary in a lump sum; provided
that payment of amounts that are Post-December 31, 2004 Deferrals shall continue
to be made pursuant to the form elected in connection with the Participant's
commencement of participation in the Plan on an Election Form. Any lump sum
payment shall be made no later than sixty (60) days after the date of the
Participant's death. Any payment made (other than payment of a Post-December 31,
2004 Deferral) shall be subject to the Deduction Limitation.

      4.4 Termination Benefit.

            (a) Termination Other Than For Cause. If a Participant experiences a
      Termination of Employment for any reason other than as a result of a
      termination by the Company for Cause prior to his or her becoming entitled
      to receive benefits by reason of any other sections of this Article 4,
      such Participant shall receive a Termination Benefit, which shall be equal
      to the Participant's vested Account Balance as of the date on which he or
      she experiences a Termination of Employment. A Participant, in connection
      with his or her commencement of participation in the Plan, shall elect on
      an Election Form to receive the Termination Benefit pursuant to this
      Section 4.4(a) in a lump sum or pursuant to an Annual Installment Method
      over a period of up to fifteen (15) years. If a Participant does not make
      any election with respect to the payment of the Termination Benefit
      pursuant to this Section 4.4(a), then such benefit shall be payable in a
      lump sum. The lump sum payment shall be made, or installment payments
      shall commence, no later than sixty (60) days after the date of the
      Participant experiences a Termination of Employment. Any payment made
      (other than payment of a Post-December 31, 2004 Deferral) shall be subject
      to the Deduction Limitation.

            (b) Termination For Cause. If a Participant experiences a
      Termination of Employment as a result of a termination by the Company for
      Cause prior to his or her becoming entitled to receive benefits by reason
      of any other sections of this Article 4, such Participant shall receive a
      Termination Benefit, which shall be equal to the Participant's vested
      Account Balance as of the date on which he or she experiences a
      Termination of Employment. The Termination Benefit pursuant to this
      Section 4.4(b) shall be paid in a lump sum. The lump sum payment shall be
      made no later than sixty (60) days after the date of the Participant's
      Termination of Employment. Any payment made (other than payment of a
      Post-December 31, 2004 Deferral) shall be subject to the Deduction
      Limitation.

            (c) Key Employees. Notwithstanding any other provision in this
      Section 4.4, if Participant is a Key Employee as of the date of his or her
      Termination of Employment, solely with regard to Post-December 31, 2004
      Deferrals, if any, the lump sum payment shall be made, or installment
      payments shall commence, no earlier than six (6) months after the date of
      the Participant's Termination of Employment.

                                      -14-
<PAGE>
      4.5 Disability Benefit. In the event of the Participant's Termination of
Employment as a result of his or her Disability, as determined by the
Administrator, the Participant shall receive a Disability Benefit, which shall
be equal to the Participant's vested Account Balance as of the date on which he
or she experiences a Termination of Employment (after giving effect to any
accelerated vesting as a result of the Participant's Disability pursuant to
Section 3.5). A Participant, in connection with his or her commencement of
participation in the Plan, shall elect on an Election Form to receive the
Disability Benefit in a lump sum or pursuant to an Annual Installment Method
over a period of up to fifteen (15) years; provided, however, that
notwithstanding a Participant's election, other than with respect to
Post-December 31, 2004 Deferrals the Administrator may decide, in its sole
discretion, the manner in which such Disability Benefit shall be paid. If a
Participant does not make any election with respect to the payment of the
Disability Benefit, then the Participant shall be deemed to have elected to have
the Disability Benefit paid in a lump sum. The lump sum payment shall be made,
or installment payments shall commence, no later than sixty (60) days after the
date of the Participant's Termination of Employment. Any payment made (other
than payment of a Post-December 31, 2004 Deferral) shall be subject to the
Deduction Limitation.

      4.6 Change in Control Benefit.

            (a) Change in Control Benefit. The Committee may, in its sole
      discretion, determine that a Participant shall receive a Change in Control
      Benefit, which shall be equal to the Participant's vested Account Balance
      in the event of a Change in Control (after giving effect to any
      accelerated vesting as a result of the Participant's Disability pursuant
      to Section 3.5). A Participant's Change in Control Benefit shall be paid
      in a lump sum. The lump sum payment shall be made immediately prior to the
      Change in Control. Any payment made shall be subject to the Deduction
      Limitation and the Excise Tax Limitation. With respect to Post-December
      31, 2004 Deferrals, any Change in Control Benefit that the Committee
      determines to pay must be made within twelve (12) months after a Change in
      Control and shall result in a termination of the Plan.

            (b) Change in Control Benefit to Take Precedence Over Other
      Benefits. Should the Committee decide to pay a Change in Control Benefit,
      any Annual Deferral Amount other than a Post-December 31, 2004 Deferral,
      plus amounts credited or debited thereon, that is subject to an existing
      payout under Section 4.1, 4.2, 4.3, 4.4 or 4.5 shall not be paid in
      accordance with such Section but shall be paid in accordance with this
      Section 4.6. Payments of Post-December 31, 2004 Deferrals shall not be
      accelerated as a result of this Section 4.6.

                                   ARTICLE 5.
            UNFORESEEABLE FINANCIAL EMERGENCIES; WITHDRAWAL ELECTION

      5.1 Withdrawal Payout/Suspensions for Unforeseeable Financial Emergencies.
If a Participant experiences an Unforeseeable Financial Emergency, the
Participant may petition the Administrator to (i) suspend any deferrals required
to be made by a Participant and/or (ii) receive a partial or full payout from
the Plan. The payout shall not exceed the lesser of the Participant's vested
Account Balance, calculated as if such Participant were receiving a Termination
Benefit, or the amount reasonably needed to satisfy the Unforeseeable Financial
Emergency. If, subject to the sole discretion of the Administrator, the petition
for a suspension and/or payout is approved, suspension shall take effect upon
the date of approval and any payout shall be made within sixty (60) days of the
date of approval. The payment of any amount under this Section 5.1 (other than
payment of Post-December 31, 2004 Deferrals) shall be subject to the Deduction
Limitation. Once the payout is paid, the Participant shall not be eligible to
participate in the Plan for the remainder of the Plan Year during which the
payout is paid and the subsequent Plan Year.

      5.2 Withdrawal Election. A Participant (or, after a Participant's death,
his or her Beneficiary) may elect, at any time, to withdraw all or a portion of
his or her vested Account Balance

                                      -15-
<PAGE>
(other than any Post-December 31, 2004 Deferrals), calculated as if there had
occurred a Termination of Employment as of the day of the election, less a
withdrawal penalty equal to ten percent (10%) of such amount (the net amount
shall be referred to as the "Withdrawal Amount"). This election can be made at
any time. The Participant (or his or her Beneficiary) shall make this election
by giving the Administrator advance written notice of the election in a form
determined from time to time by the Administrator. The Participant (or his or
her Beneficiary) shall be paid the Withdrawal Amount within sixty (60) days of
his or her election. Once the Withdrawal Amount is paid, the Participant's
participation in the Plan shall terminate and the Participant shall not be
eligible to participate in the Plan for the remainder of the Plan Year during
which the Withdrawal Amount is paid and the subsequent Plan Year. The payment of
this Withdrawal Amount shall be subject to the Deduction Limitation.

                                   ARTICLE 6.
                             BENEFICIARY DESIGNATION

      6.1 Beneficiary. Each Participant shall have the right, at any time, to
designate his or her Beneficiary(ies) (both primary as well as contingent) to
receive any benefits payable under the Plan to a beneficiary upon the death of a
Participant. The Beneficiary designated under this Plan may be the same as or
different from the Beneficiary designation under any other plan of an Employer
in which the Participant participates.

      6.2 Beneficiary Designation; Change. A Participant shall designate his or
her Beneficiary by completing and signing the Beneficiary Designation Form, and
returning it to the Administrator or its designated agent. A Participant shall
have the right to change a Beneficiary by completing, signing and otherwise
complying with the terms of the Beneficiary Designation Form and the
Administrator's rules and procedures, as in effect from time to time. Upon the
acceptance by the Administrator of a new Beneficiary Designation Form, all
Beneficiary designations previously filed shall be canceled. The Administrator
shall be entitled to rely on the last Beneficiary Designation Form filed by the
Participant and accepted by the Administrator prior to his or her death.

      6.3 No Beneficiary Designation. If a Participant fails to designate a
Beneficiary as provided in Sections 6.1 and 6.2 above or, if all designated
Beneficiaries predecease the Participant or die prior to complete distribution
of the Participant's benefits, then the Participant's designated Beneficiary
shall be deemed to be his or her surviving spouse. If the Participant has no
surviving spouse, the benefits remaining under the Plan to be paid to a
Beneficiary shall be payable to the executor or personal representative of the
Participant's estate.

      6.4 Doubt as to Beneficiary. If the Administrator has any doubt as to the
proper Beneficiary to receive payments pursuant to this Plan, the Administrator
shall have the right, exercisable in its discretion, to cause the Participant's
Employer to withhold such payments until this matter is resolved to the
Administrator's satisfaction.

      6.5 Discharge of Obligations. The payment of benefits under the Plan to a
Beneficiary shall fully and completely discharge all Employers and the
Administrator from all further obligations under this Plan with respect to the
Participant, and that Participant's Election Form shall terminate upon such full
payment of benefits.

                                   ARTICLE 7.
                                LEAVE OF ABSENCE

      7.1 Paid Leave of Absence. If a Participant is authorized by the
Participant's Employer for any reason to take a paid leave of absence from the
employment of the Employer, the Participant shall continue to be considered
employed by the Employer and the Annual Deferral Amount shall continue to

                                      -16-
<PAGE>
be withheld during such paid leave of absence in accordance with Section 3.4;
provided however, that this Section 7.1 shall not be effective with respect to
Post-December 31, 2004 Deferrals to the extent that such leave of absence
constitutes a "separation from service" within the meaning of Code Section
409A(a)(2)(A)(i) and any regulations promulgated thereunder.

      7.2 Unpaid Leave of Absence; Disability Leave. If a Participant is
authorized by the Participant's Employer for any reason to take an unpaid leave
of absence from the employment of the Employer, or if a Participant is on leave
of absence as a result of his or her Disability, the Participant shall continue
to be considered employed by the Employer and the Participant shall be excused
from making deferrals until the earlier of the date the leave of absence expires
or the Participant returns to a paid employment status. Upon such expiration or
return, deferrals shall resume for the remaining portion of the Plan Year in
which the expiration or return occurs, based on the deferral election, if any,
made for that Plan Year. If no election was made for that Plan Year, no deferral
shall be withheld. Notwithstanding the foregoing, this Section 7.2 shall not be
effective with respect to Post-December 31, 2004 Deferrals to the extent that
such leave of absence constitutes a "separation from service" within the meaning
of Code Section 409A(a)(2)(A)(i) and any regulations promulgated thereunder

                                   ARTICLE 8.
                     TERMINATION, AMENDMENT OR MODIFICATION

      8.1 Termination. Although each Employer anticipates that it will continue
the Plan for an indefinite period of time, there is no guarantee that any
Employer will continue the Plan or will not terminate the Plan at any time in
the future. Accordingly, each Employer reserves the right to discontinue its
sponsorship of the Plan and/or to terminate the Plan at any time with respect to
any or all of its participating Employees and Non-Employee Directors, by action
of its board of directors or similar governing body. Upon the termination of the
Plan with respect to any Employer, the participation of the affected
Participants who are employed by that Employer, or in the service of that
Employer as Directors, shall terminate and their Account Balances other than
Post-December 31, Deferrals determined as if they had experienced a Termination
of Employment on the date of Plan termination or, if Plan termination occurs
after the date upon which a Participant was eligible to Retire, then with
respect to that Participant as if he or she had Retired on the date of Plan
termination, shall, other than with respect to Post-December 31, 2004 Deferrals
be paid to the Participants in a lump sum within sixty (60) days following the
plan termination. Upon the Plan's termination, Post-December 31, 2004 Deferrals
shall be paid to Participants in accordance with the terms hereof in effect
immediately before such termination. The termination of the Plan shall not
adversely affect any Participant or Beneficiary who has become entitled to the
payment of any benefits under the Plan as of the date of termination; provided,
however, that other than with respect to Post-December 31, 2004 Deferrals the
Employer shall have the right to accelerate installment payments without a
premium or prepayment penalty by paying the Account Balance in a lump sum or
pursuant to an Annual Installment Method using fewer years (provided that the
present value of all payments that will have been received by a Participant at
any given point of time under the different payment schedule shall equal or
exceed the present value of all payments that would have been received at that
point in time under the original payment schedule).

      8.2 Amendment. An Employer may, at any time, amend or modify the Plan in
whole or in part with respect to that Employer by the action of its board of
directors or similar governing body; provided, however, that no amendment or
modification shall be effective to decrease or restrict the value of a
Participant's Account Balance in existence at the time the amendment or
modification is made, calculated as if the Participant had experienced a
Termination of Employment as of the effective date of the amendment or
modification or, if the amendment or modification occurs after the date upon
which the Participant was eligible to Retire, the Participant had Retired as of
the effective date of the amendment or modification. The amendment or
modification of the Plan shall not affect any Participant or Beneficiary who has
become entitled to the payment of benefits under the Plan as of the date of the
amendment or modification; provided, however, that other than with respect to
Post-December 31, 2004 Deferrals the Employer shall have the right to accelerate
installment payments by paying the Account Balance in a

                                      -17-
<PAGE>
lump sum or pursuant to an Annual Installment Method using fewer years (provided
that the present value of all payments that will have been received by a
Participant at any given point of time under the different payment schedule
shall equal or exceed the present value of all payments that would have been
received at that point in time under the original payment schedule).
Notwithstanding any provisions of this Section 8.2 to the contrary, the
Committee may amend the Plan at any time, in any manner, if the Committee
determines any such amendment is required to ensure that the Plan is
characterized as providing deferred compensation for a select group of
management or highly compensated employees and as described in ERISA Sections
201(2), 301(a)(3) and 401(a)(1) or to otherwise conform the Plan to the
provisions of any applicable law, including ERISA and the Code.

      8.3 Effect of Payment. The full payment of the applicable benefit under
Article 4 of the Plan shall completely discharge all obligations to a
Participant and his or her designated Beneficiaries under this Plan.

                                   ARTICLE 9.
                                 ADMINISTRATION

      9.1 Administrator Duties. The Committee appointed pursuant to Section 9.3
shall be the Administrator and shall conduct the general administration of the
Plan in accordance with the Plan and shall have all the necessary power and
authority to carry out that function. Members of the Administrator may be
Participants under this Plan. Any individual serving on the Administrator who is
a Participant shall not vote or act on any matter relating solely to himself or
herself. Among the Committee's necessary powers and duties are the following:

            (a) Except to the extent provided otherwise by Article 12, to
      delegate all or part of its function as Administrator to others and to
      revoke any such delegation.

            (b) To determine questions of eligibility of Participants and their
      entitlement to benefits, subject to the provisions of Articles 10 and 12.

            (c) To select and engage attorneys, accountants, actuaries,
      trustees, appraisers, brokers, consultants, administrators, physicians or
      other persons to render service or advice with regard to any
      responsibility the Administrator has under the Plan, or otherwise, to
      designate such persons to carry out fiduciary responsibilities (other than
      trustee responsibilities) under the Plan, and (with the Committee, the
      Employers and their officers, Directors, trustees and Employees) to rely
      upon the advice, opinions or valuations of any such persons, to the extent
      permitted by law, being fully protected in acting or relying thereon in
      good faith.

            (d) To interpret the Plan for purpose of the administration and
      application of the Plan, in a manner not inconsistent with the Plan or
      applicable law and to amend or revoke any such interpretation.

            (e) To conduct claims procedures as provided in Article 10.

      9.2 Binding Effect of Decisions. The decision or action of the
Administrator with respect to any question arising out of or in connection with
the administration, interpretation and application of the Plan and the rules and
regulations promulgated hereunder shall be final and conclusive and binding upon
all persons having any interest in the Plan.

      9.3 Committee. The Committee shall consist solely of two or more
Non-Employee Directors appointed by and holding office at the pleasure of the
Board, each of whom is both a "non-employee director" as defined by Rule 16b-3
and an "outside director" for purposes of Section 162(m) of the Code.

                                      -18-
<PAGE>
Appointment of Committee members shall be effective upon acceptance of
appointment. Committee members may resign at any time by delivering written
notice to the Board. Vacancies in the Committee may be filled by the Board.

      9.4 Indemnification. All Employers shall indemnify and hold harmless any
of their officers, Directors, Committee members or Employees who are involved in
the administration of the Plan against any and all claims, losses, damages,
expenses or liabilities arising out of the good faith performance of their
administrative functions.

      9.5 Employer Information. To enable the Administrator to perform its
functions, each Employer shall supply full and timely information to the
Administrator on all matters relating to the compensation of its Participants,
the date and circumstances of the Retirement, Disability, death or Termination
of Employment of its Participants, and such other pertinent information as the
Administrator may reasonably require.

                                  ARTICLE 10.
                               CLAIMS PROCEDURES

      10.1 Presentation of Claim. Any Participant or Beneficiary of a deceased
Participant (such Participant or Beneficiary being referred to below as a
"Claimant") may deliver to the Administrator a written claim for a determination
with respect to the amounts distributable to such Claimant from the Plan. The
claim must state with particularity the determination desired by the Claimant.

      10.2 Notification of Decision. The Administrator shall consider a
Claimant's claim within a reasonable time, and shall notify the Claimant in
writing:

            (a) that the Claimant's requested determination has been made, and
      that the claim has been allowed in full; or

            (b) that the Administrator has reached a conclusion contrary, in
      whole or in part, to the Claimant's requested determination, and such
      notice must set forth in a manner calculated to be understood by the
      Claimant:

                  (i)   the specific reason(s) for the denial of the claim, or
                        any part of it;

                  (ii)  specific reference(s) to pertinent provisions of the
                        Plan upon which such denial was based;

                  (iii) a description of any additional material or information
                        necessary for the Claimant to perfect the claim, and an
                        explanation of why such material or information is
                        necessary; and

                  (iv)  an explanation of the claim review procedure set forth
                        in Section 9.3 below, including a statement of the
                        Claimant's right to bring a civil action under Section
                        502(a) of ERISA following an adverse decision on review.

            The notice of denial shall be given within a reasonable time period
but no later than ninety (90) days after the claim is filed, unless special
circumstances require an extension of time for processing the claim. If such
extension is required, written notice shall be furnished to the Claimant within
ninety (90) days of the date the claim was filed stating the special
circumstances requiring an extension of time and the date by which a decision on
the claim can be expected, which shall be no more than one hundred eighty (180)
days from the date the claim was filed.

                                      -19-
<PAGE>
      10.3 Review of a Denied Claim. Within sixty (60) days after receiving a
notice from the Administrator that a claim has been denied, in whole or in part,
a Claimant (or the Claimant's duly authorized representative) may file with the
Administrator a written request for a review of the denial of the claim.
Thereafter, but not later than thirty (30) days after the review procedure
began, the Claimant (or the Claimant's duly authorized representative):

            (a) may review and/or copy, free of charge, pertinent documents,
      records and other information relevant to the Claimant's claim;

            (b) may submit issues, written comments or other documents, records
      and information relating to the claim; and/or

            (c) may request a hearing, which the Administrator, in its sole
      discretion, may grant.

      10.4 Decision on Review. The Administrator shall render its decision on
review promptly, and not later than sixty (60) days after the filing of a
written request for review of the denial, unless a hearing is held or other
special circumstances require additional time, in which case the Administrator's
decision must be rendered within one hundred twenty (120) days after such date.
Such decision must be written in a manner calculated to be understood by the
Claimant, and it must contain:

            (a) specific reasons for the decision;

            (b) specific reference(s) to the pertinent Plan provisions upon
      which the decision was based;

            (c) a statement that the Claimant is entitled to receive upon
      request and free of charge reasonable access to and copies of all
      documents, records and other information relevant to the Claimant's claim
      for benefits;

            (d) a statement of the Claimant's right to bring a civil action
      under Section 502(a) of ERISA following an adverse decision on review; and

            (e) such other matters as the Administrator deems relevant.

      10.5 Designation. The Administrator may designate any other person of its
choosing to make any determination otherwise required under this Article 10.

      10.6 Arbitration.

            (a) A Claimant whose appeal has been denied under Section 9.4 shall
      have the right to submit said claim to final and binding arbitration
      before a single arbitrator in San Diego, California, pursuant to the rules
      of the American Arbitration Association. Any such requests for arbitration
      must be filed by written demand to the American Arbitration Association
      within sixty (60) days after receipt of the decision regarding the appeal.
      The arbitrator's decision shall be final and binding upon the parties, and
      may be entered and enforced in any court of competent jurisdiction by
      either of the parties; provided, however, that the arbitrator shall not
      have any power to alter, amend, modify or change any of the terms of this
      Plan nor to grant any remedy which is either prohibited by the terms of
      this Plan or not available in a court of law. The arbitrator shall have
      the power to grant temporary, preliminary and permanent relief, including
      without limitation, injunctive relief and specific performance.

            (b) The Company will pay the direct costs and expenses of the
      arbitration. The Claimant and the Company are responsible for their
      respective attorneys' fees incurred in

                                      -20-
<PAGE>
      connection with the arbitration; however, to the extent permitted by law,
the arbitrator may, in his or her discretion, award reasonable attorneys' fees
to the prevailing party.

                                  ARTICLE 11.
                                     TRUST

      11.1 Establishment of the Trust. The Company shall establish the Trust.
All benefits payable under this Plan to a Participant shall be paid directly by
the Employer(s) from the Trust. To the extent that such benefits are not paid
from the Trust, the benefits shall be paid from the general assets of the
Employer(s). The Trust, if any, shall be an irrevocable grantor trust which
conforms to the terms of the model trust as described in IRS Revenue Procedure
92-64, I.R.B. 1992-33. The assets of the Trust are subject to the claims of each
Employer's creditors in the event of its insolvency. Except as provided under
the Trust agreement, neither the Company nor an Employer shall be obligated to
set aside, earmark or escrow any funds or other assets to satisfy its
obligations under this Plan, and the Participant and/or his or her designated
Beneficiaries shall not have any property interest in any specific assets of the
Company or an Employer other than the unsecured right to receive payments from
the Employer, as provided in this Plan.

      11.2 Interrelationship of the Plan and the Trust. The provisions of the
Plan shall govern the rights of a Participant to receive distributions pursuant
to the Plan. The provisions of the Trust shall govern THE rights of the
Employers, Participants and the creditors of the Employers to the assets
transferred to the Trust. Each Employer shall at all times remain liable to
carry out its obligations under the Plan.

      11.3 Investment of Trust Assets. The Trustee of the Trust shall be
authorized, upon written instructions received from the Administrator or
investment manager appointed by the Administrator, to INVEST and reinvest the
assets of the Trust in accordance with the applicable Trust Agreement, including
the disposition of Stock and reinvestment of the proceeds in one or more
investment vehicles designated by the Administrator.

      11.4 Distributions From the Trust. Each Employer's obligations under the
Plan may be satisfied with Trust assets distributed pursuant to the terms of the
Trust, and any such distribution shall REDUCE the Employer's obligations under
this Plan.

                                  ARTICLE 12.
                    PROVISIONS RELATING TO SECURITIES LAWS

      12.1 Designation of Participants. With respect to any Employee or
Non-Employee Director who is then subject to Section 16 of the Exchange Act,
only the Committee may designate such Employee or Non-Employee Director as a
Participant in the Plan.

      12.2 Action by Committee. With respect to any Participant who is then
subject to Section 16 of the Exchange Act, any function of the Administrator
under the Plan relating to such Participant shall be performed solely by the
Committee, if and to the extent required to ensure the availability of an
exemption under Section 16 of the Exchange Act for any transaction relating to
such Participant under the Plan.

      12.3 Compliance with Section 16. Notwithstanding any other provision of
the Plan or any rule, instruction, election form or other form, the Plan and any
such rule, instruction or form shall be subject to any additional conditions or
limitations set forth in any applicable exemptive rule under Section 16 of the
Exchange Act (including any amendment to Rule 16b-3) that are requirements for
the application of such exemptive rule. To the extent permitted by applicable
law, such provision, rule, instruction or form shall be deemed amended to the
extent necessary to conform to such applicable exemptive rule.

                                      -21-
<PAGE>
                                  ARTICLE 13.
                                 MISCELLANEOUS

      13.1 Status of Plan. The Plan is intended to be a plan that is not
qualified within the meaning of Code Section 401(a) and that "is unfunded and is
maintained by an employer primarily for the purpose of providing deferred
compensation for a select group of management or highly compensated employees"
within the meaning of ERISA Sections 201(2), 301(a)(3) and 401(a)(1). The Plan
shall be administered and interpreted to the extent possible in a manner
consistent with that intent.

      13.2 Unsecured General Creditor. Participants and their Beneficiaries,
heirs, successors and assigns shall have no legal or equitable rights, interests
or claims in any property or assets of any Employer. For purposes of the payment
of benefits under this Plan, any and all of an Employer's assets shall be, and
remain, the general, unpledged unrestricted assets of the Employer. An
Employer's obligation under the Plan shall be merely that of an unfunded and
unsecured promise to pay money in the future.

      13.3 Employer's Liability. An Employer's liability for the payment of
benefits shall be defined only by the Plan and the Election Form(s), as entered
into between the Employer and a Participant. An Employer shall have no
obligation to a Participant under the Plan except as expressly provided in the
Plan and his or her Election Form(s).

      13.4 Nonassignability. Neither a Participant nor any other person shall
have any right to commute, sell, assign, transfer, pledge, anticipate, mortgage
or otherwise encumber, transfer, hypothecate, alienate or convey in advance of
actual receipt, the amounts, if any, payable hereunder, or any part thereof,
which are, and all rights to which are expressly declared to be, unassignable
and non-transferable. No part of the amounts payable shall, prior to actual
payment, be subject to seizure, attachment, garnishment or sequestration for the
payment of any debts, judgments, alimony or separate maintenance owed by a
Participant or any other person, be transferable by operation of law in the
event of a Participant's or any other person's bankruptcy or insolvency or be
transferable to a spouse as a result of a property settlement or otherwise. The
benefits which a Participant may accrue under this Plan are not subject to the
terms of any Qualified Domestic Relations Order (as that term is defined in
Section 414(p) of the Code) with respect to any Participant, and the
Administrator, the Board, the Committee, the Company and any Employer shall not
be required to comply with the terms of such order in connection with this Plan.
Notwithstanding the foregoing, the withholding of taxes from Plan payments, the
recovery of Plan overpayments of benefits made to a Participant or Beneficiary,
the transfer of Plan benefit rights from the Plan to another plan, or the direct
deposit of Plan payments to an account in a financial institution (if not
actually a part of an arrangement constituting an assignment or alienation)
shall not be construed as an assignment or alienation under this Section 13.4
and shall be permitted under the Plan.

      13.5 Tax Withholding.

            (a) Annual Deferral Amounts. For each Plan Year in which an Annual
      Deferral Amount is being withheld from a Participant, the Participant's
      Employer(s) shall be entitled to require payment by the Participant of any
      sums required by federal, state or local tax law to be withheld with
      respect to the deferral, in amounts and in a manner to be determined in
      the sole discretion of the Employer(s).

            (b) Company Matching Amounts and Company Contribution Amounts. When
      a Participant becomes vested in a portion of his or her Company Matching
      Account and/or Company Contribution Account, the Participant's Employer(s)
      shall be entitled to require payment by the Participant of any sums
      required by federal, state or local tax law to be withheld with respect to
      the deferral, in amounts and in a manner to be determined in the sole
      discretion of the Employer(s).

                                      -22-
<PAGE>
            (c) Distributions. The Participant's Employer(s), or the trustee of
      the Trust, shall withhold from any payments made to a Participant under
      this Plan all federal, state and local income, employment and other taxes
      required to be withheld by the Employer(s), or the trustee of the Trust,
      in connection with such payments, in amounts and in a manner to be
      determined in the sole discretion of the Employer(s) and the trustee of
      the Trust.

            (d) Satisfaction of Tax Obligations. The Administrator, in its sole
      discretion, may allow a Participant to pay to his or her Employer(s) any
      amounts required to be withheld by the Employer(s) in connection with the
      Plan in cash, by deduction of such amounts from other compensation payable
      to the Participant, or to have such amounts withheld from his or her
      deferrals, vested Account Balance or distributions.

      13.6 Coordination with Other Benefits. The benefits provided for a
Participant and Participant's Beneficiary under the Plan are in addition to any
other benefits available to such Participant under any other plan or program for
Employees of the Participant's Employer(s). The Plan shall supplement and shall
not supersede, modify or amend any other such plan or program except as may
otherwise be expressly provided.

      13.7 Compliance. A Participant shall have no right to receive payment with
respect to the Participant's Account Balance until all legal and contractual
obligations of the Employer(s) relating to establishment of the Plan and the
making of such payments shall have been complied with in full.

      13.8 Not a Contract of Employment. The terms and conditions of this Plan
shall not be deemed to constitute a contract of employment between any Employer
and the Participant. Such employment is hereby acknowledged to be an "at will"
employment relationship that can be terminated at any time for any reason, or no
reason, with or without cause, and with or without notice, unless expressly
provided in a written employment agreement. Nothing in this Plan shall be deemed
to give a Participant the right to be retained in the service of any Employer,
either as an Employee or a Director, or to interfere with the right of any
Employer to discipline or discharge the Participant at any time.

      13.9 Furnishing Information. A Participant or his or her Beneficiary will
cooperate with the Administrator by furnishing any and all information requested
by the Administrator and take such other actions as may be requested in order to
facilitate the administration of the Plan and the payments of benefits
hereunder, including but not limited to taking such physical examinations as the
Administrator may deem necessary.

      13.10 Governing Law. Subject to ERISA, the provisions of this Plan shall
be construed and interpreted according to the internal laws of the State of
California without regard to its conflicts of laws principles.

      13.11 Notice. Any notice or filing required or permitted to be given to
the Administrator under this Plan shall be sufficient if in writing and
hand-delivered, or sent by registered or certified mail, to the address below:

                  Chief Financial Officer
                  Neurocrine Biosciences, Inc.
                  12790 El Camino Real
                  San Diego, CA 92130

                  with a copy to:

                  Secretary

                                      -23-
<PAGE>
                  Neurocrine Biosciences, Inc.
                  12790 El Camino Real
                  San Diego, CA 92130

      Such notice shall be deemed given as of the date of delivery or, if
delivery is made by mail, as of the date shown on the postmark on the receipt
for registration or certification.

      Any notice or filing required or permitted to be given to a Participant
under this Plan shall be sufficient if in writing and hand-delivered, or sent by
mail, to the last known address of the Participant.

      13.12 Successors. The provisions of this Plan shall bind and inure to the
benefit of the Participant's Employer and its successors and assigns and the
Participant and the Participant's designated Beneficiaries.

      13.13 Spouse's Interest. The interest in the benefits hereunder of a
spouse of a Participant who has predeceased the Participant shall automatically
pass to the Participant and shall not be transferable by such spouse in any
manner, including but not limited to such spouse's will, nor shall such interest
pass under the laws of intestate succession.

      13.14 Validity. In case any provision of this Plan shall be illegal or
invalid for any reason, said illegality or invalidity shall not affect the
remaining parts hereof, but this Plan shall be construed and enforced as if such
illegal or invalid provision had never been inserted herein.

      13.15 Incompetent. If the Administrator determines in its discretion that
a benefit under this Plan is to be paid to a minor, a person declared
incompetent or to a person incapable of handling the disposition of that
person's property, the Administrator may direct payment of such benefit to the
guardian, legal representative or person having the care and custody of such
minor, incompetent or incapable person. The Administrator may require proof of
minority, incompetence, incapacity or guardianship, as it may deem appropriate
prior to distribution of the benefit. Any payment of a benefit shall be a
payment for the account of the Participant and the Participant's Beneficiary, as
the case may be, and shall be a complete discharge of any liability under the
Plan for such payment amount.

      13.16 Court Order. The Administrator is authorized to make any payments
directed by court order in any action in which the Plan or the Administrator has
been named as a party. In addition, if a court determines that a spouse or
former spouse of a Participant has an interest in the Participant's benefits
under the Plan in connection with a property settlement or otherwise, the
Administrator, in its sole discretion, shall have the right, notwithstanding any
election made by a Participant, to immediately distribute the spouse's or former
spouse's interest in the Participant's benefits under the Plan to that spouse or
former spouse.

      13.17 Distribution in the Event of Taxation.

            (a) In General. If, for any reason, all or any portion of a
      Participant's benefits under this Plan becomes taxable to the Participant
      prior to receipt, a Participant may petition the Administrator for a
      distribution of that portion of his or her benefit that has become
      taxable. Upon the grant of such a petition, which grant shall not be
      unreasonably withheld, a Participant's Employer shall distribute to the
      Participant immediately available funds in an amount equal to the Federal
      Insurance Contributions Act ("FICA") tax imposed under Code Sections 3101
      and 3121(v)(2) on amounts deferred under the Plan (the "FICA Amount") as
      well as income tax at source on wages imposed under Code Section 3041 with
      respect to his or her benefit, as well as the additional income tax at
      source on wages attributable to the pyramiding Code Section 3401 wages and
      taxes (which aggregate amounts shall not exceed the lesser of a
      Participant's unpaid Account Balance under the Plan or the aggregate
      amount of the FICA Amount and the income tax withholding related to such
      FICA Amount). If the petition is granted, the tax liability distribution

                                      -24-
<PAGE>
      shall be made within ninety (90) days of the date when the Participant's
      petition is granted. Such a distribution shall affect and reduce the
      benefits to be paid under this Plan.

            (b) Trust. If the Trust terminates in accordance with the provisions
      of the Trust and benefits are distributed from the Trust to a Participant
      in accordance with such provisions, the Participant's benefits under this
      Plan shall be reduced to the extent of such distributions

      13.18 Insurance. The Employers, on their own behalf or on behalf of the
trustee of the Trust, and, in their sole discretion, may apply for and procure
insurance on the life of the Participant, in such amounts and in such forms as
the Trust may choose. The Employers or the trustee of the Trust, as the case may
be, shall be the sole owner and beneficiary of any such insurance. The
Participant shall have no interest whatsoever in any such policy or policies,
and at the request of the Employers shall submit to medical examinations and
supply such information and execute such documents as may be required by the
insurance company or companies to whom the Employers have applied for insurance.

      13.19 Savings Clause. In the event any provision of this Plan, or the
application thereof, is or becomes inconsistent with Code Section 409A and any
regulations promulgated thereunder, such provision shall be void or
unenforceable or in the sole discretion of the Committee shall be deemed amended
to comply with Code Section 409A and any regulations promulgated thereunder. The
other provisions of this Plan shall remain in full force and effect.

                                      -25-
<PAGE>
            IN WITNESS WHEREOF, the Company has signed this Plan document as of
April 26, 2005.

                                    Neurocrine Biosciences, Inc., a Delaware
                                    corporation

                                    By: __________________________________

                                    Title: _________________________________
                                          Executive Vice President and Chief
                                          Financial Officer

                                      -26-

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