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                                                                     EXHIBIT 4.5

                         HUTTIG BUILDING PRODUCTS, INC.

                            2001 STOCK INCENTIVE PLAN

1.       PURPOSE AND ADOPTION OF THE PLAN

         The purpose of the Huttig Buildings Products, Inc. 2001 Stock Incentive
Plan (as the same may be amended from time to time, the "Plan") is (i) to
attract and retain key employees of Huttig Building Products, Inc., a Delaware
corporation (the "Company"), and its Subsidiaries (as defined below) who are and
will be contributing to the success of the business; (ii) to motivate and reward
key employees who have made significant contributions to the success of the
Company and encourage them to continue to give their best efforts to its future
success; (iii) to provide competitive incentive compensation opportunities; and
(iv) to further opportunities for stock ownership by such key employees in order
to increase their proprietary interest in the Company and their personal
interest in its continued success.

         The Plan has been approved by the Board of Directors of the Company
(the "Board") to be effective as of December 3, 2001 (the "Effective Date"). The
Plan shall remain in effect until terminated by action of the Board.

2.       DEFINITIONS

         For the purposes of this Plan, capitalized terms shall have the
following meanings:

         (a) "Award" means any grant to a Participant of one or a combination of
Non-Qualified Stock Options described in Section 6 and Restricted Shares
described in Section 8.

         (b) "Award Agreement" means a written agreement between the Company and
a Participant or a written notice or certificate from the Company to a
Participant specifically setting forth the terms and conditions of an Award
granted under the Plan.

         (c) "Beneficiary" means an individual, trust or estate who or which, by
a written designation of the Participant filed with the Company or by operation
of law, succeeds to the rights and obligations of the Participant under the Plan
and an Award Agreement upon the Participant's death.

         (d) "Board" shall have the meaning given to such term in Section 1(b).

         (e) "Change in Control" means the first to occur of the following
events after the Effective Date: (i) the first purchase of shares pursuant to a
tender offer or exchange offer (other

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than a tender offer or exchange offer by the Company) for all or part of the
Company's Common Stock or any securities convertible into such Common Stock,
(ii) the receipt by the Company of a Schedule 13D or other advice indicating
that a person is the "beneficial owner" (as that term is defined in Rule 13d-3
under the Exchange Act) of 20% or more of the Company's Common Stock calculated
as provided in paragraph (d) of said Rule 13d-3, (iii) the date of consummation
of any Merger of the Company in which the Company will not be the continuing or
surviving corporation or pursuant to which shares of Common Stock of the Company
would be converted into cash, securities or other property, other than a Merger
of the Company in which the holders of Common Stock of the Company immediately
prior to the Merger would own more than 50% of the common stock of the surviving
corporation immediately after the Merger, (iv) the date of consummation of any
sale, lease, exchange or other transfer (in one transaction or a series of
related transactions) of all or substantially all the assets of the Company, (v)
the adoption of any plan or proposal for the liquidation (but not a partial
liquidation) or dissolution of the Company, or (vi) the date upon which the
individuals who constitute the Board as of the Effective Date (the "Incumbent
Board") cease for any reason to constitute at least a majority of the Board,
provided that any person becoming a director subsequent to such date whose
election, or nomination for election by the Company's stockholders, was approved
by a vote of at least three-quarters of the directors comprising the Incumbent
Board (other than an election or nomination of an individual whose initial
assumption of office is in connection with an actual or threatened election
contest relating to the election of the Directors of the Company) shall, for
purposes of this Plan, be considered as though such person were a member of the
Incumbent Board.

         (f) "Code" means the Internal Revenue Code of 1986, as amended.
References to a section of the Code include that section and any comparable
section or sections of any future legislation that amends, supplements or
supersedes said section.

         (g) "Committee" means the Organization and Compensation Committee of
the Board or such other committee composed of at least three members of the
Board as may be designated by the Board from time to time or, if there shall be
no such Committee, the Board.

         (h) "Company" shall have the meaning given to such term in Section 1.

         (i) "Common Stock" means Common Stock, par value $.01 per share, of the
Company.

         (j) "Date of Grant" means the date as of which the Committee grants an
Award. If the Committee contemplates an immediate grant to a Participant, the
Date of Grant shall be the date of the Committee's action. If the Committee
contemplates a date on which the grant is to be made other than the date of the
Committee's action, the Date of Grant shall be the date so contemplated and set
forth in or determinable from the records of action of the Committee; provided,
however, that the Date of Grant shall not precede the date of the Committee's
action.

         (k) "Effective Date" shall have the meaning given to such term in
Section 1.

         (l) "Exchange Act" means the Securities Exchange Act of 1934, as
amended.

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         (m) "Fair Market Value" means, as of any applicable date, for all
purposes in this Plan, the average of the high and low sales prices of the
Common Stock on the New York Stock Exchange-Composite Transactions Tape on such
date, or if no sale of stock has been recorded on such date, then on the next
preceding date on which a sale was so made. In the event the Common Stock is not
admitted to trade on a securities exchange, the Fair Market Value as of any
given date shall be as determined in good faith by the Committee.

         (n) "Incentive Stock Option" means a stock option within the meaning of
Section 422 of the Code.

         (o) "Merger" means any merger, reorganization, consolidation, share
exchange, transfer of assets or other transaction having similar effect
involving the Company.

         (p) "Non-Qualified Stock Option" means a stock option which is not an
Incentive Stock Option.

         (q) "Options" means all Non-Qualified Stock Options granted at any time
under the Plan.

         (r) "Participant" means a person designated to receive an Award under
the Plan in accordance with Section 5.

         (s) "Permanent Disability" means a physical or mental disability or
infirmity that prevents the performance of a Participant's services for the
Company and its Subsidiaries lasting (or likely to last, based on competent
medical evidence presented to the Committee) for a period of six months or
longer. The Committee's reasoned and good faith judgment of Permanent Disability
shall be final and shall be based on such competent medical evidence as shall be
presented to it by such Participant or by any physician or group of physicians
or other competent medical expert employed by the Participant or the Company to
advise the Committee.

         (t) "Plan" shall have the meaning given to such term in Section 1(a).

         (u) "Purchase Price," with respect to Options, shall have the meaning
set forth in Section 6(b).

         (v) "Restricted Shares" means Common Stock subject to restrictions
imposed in connection with Awards granted under Section 8.

         (w) "Retirement" means a Participant's retirement at or after age 65.

         (x) "Subsidiary" means a subsidiary of the Company within the meaning
of Section 424(f) of the Code.

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3.       ADMINISTRATION

         (a) This Plan shall be administered by the Committee; provided,
however, if any member of the Committee does not meet the qualifications for a
"non-employee director" established from time to time by rules or regulations of
the Securities and Exchange Commission under Section 16 of the Exchange Act, the
remaining members of the Committee (but not less than two) shall administer the
Plan. The Committee shall have the sole discretionary authority to interpret the
Plan, to establish and modify administrative rules for the Plan, to impose such
conditions and restrictions on Awards as it determines appropriate, and to take
such steps in connection with the Plan and Awards granted hereunder as it may
deem necessary or advisable. No member of the Committee shall be eligible to
participate in, and no person shall become a member of the Committee if within
one year prior thereto he or she shall have been eligible to participate in this
Plan or any other plan of the Company or its Subsidiaries (other than the Huttig
Building Products, Inc. 1999 Non-Employee Director Restricted Stock Plan)
entitling the participants therein to acquire stock, stock options, stock
appreciation rights or restricted stock of the Company or its Subsidiaries.
Decisions of the Committee in connection with the administration of the Plan
shall be final, conclusive and binding upon all parties, including the Company,
its stockholders and the Participants.

         (b) The Committee may employ attorneys, consultants, accountants or
other persons and the Committee and the Company and its officers and directors
shall be entitled to rely upon the advice, opinions or valuations of any such
persons. All usual and reasonable expenses of the Committee shall be paid by the
Company. No Committee member shall receive compensation with respect to his or
her services for the Committee except as may be authorized by the Board. All
actions taken and all interpretations and determinations made by the Committee
in good faith shall be final and binding upon all employees who have received
awards, the Company and all other interested persons. No member of the Committee
shall be personally liable for any action, determination or interpretations
taken or made in good faith with respect to this Plan or Awards made hereunder,
and all members of the Committee shall be fully indemnified and protected by the
Company in respect of any such action, determination or interpretation.

4.       SHARES

         (a) The total number of shares of Common Stock authorized to be issued
under the Plan shall not exceed in the aggregate 500,000 shares. The number of
shares available for issuance under the Plan shall be subject to adjustment in
accordance with Section 9. The shares to be offered under the Plan shall be
limited solely to issued shares of Common Stock which will have been reacquired
by the Company, including shares purchased in the open market.

         (b) Subject to the provisions of Section 6(d), any shares subject to an
Option granted under this Plan that expires or is terminated for any reason
without having been exercised in full, shares of Common Stock forfeited as
provided in Section 8(h) and shares of Common Stock subject to any Award that
are otherwise surrendered by a Participant or terminated shall continue

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to be available for future grants under this Plan. If any shares of Common Stock
are withheld from those otherwise issuable or are tendered to the Company, by
attestation or otherwise, in connection with the exercise of an Option, only the
net number of shares of Common Stock issued as a result of such exercise shall
be deemed delivered for purposes of determining the maximum number of shares
available for delivery under the Plan.

5.       PARTICIPATION

         Participants in the Plan shall be such key employees of the Company and
its Subsidiaries as the Committee, in its sole discretion, may designate from
time to time. For purposes of the Plan, "key employees" shall mean officers as
well as other employees (including officers and other employees who are also
directors of the Company or any Subsidiary) designated by the Committee in its
discretion upon the recommendation of management, but shall not include any
employee who, assuming the full exercise of such Option, would own more than 10%
of the combined voting power of all classes of stock of the Company or any
Subsidiary. Options under the Plan shall only be Non-Qualified Stock Options and
not Incentive Stock Options. Awards granted hereunder shall be evidenced by
Award Agreements in such form as the Committee shall approve, which Agreements
shall comply with and be subject to the terms and conditions of this Plan.

6.       GRANT AND EXERCISE OF STOCK OPTIONS

         (a) The purchase price of each share of Common Stock upon exercise of
any Options granted under the Plan shall not be less than 100% of the Fair
Market Value of the stock on the date the Options are granted (the "Purchase
Price").

         (b) Except as otherwise permitted by the Committee or otherwise
provided in an Award Agreement, each Option granted under this Plan shall be
exercisable in whole or in part (in lots of ten shares or any multiple thereof)
from time to time beginning from the date the Option is granted, subject to the
provision that an Option may not be exercised by the Participant, except as
provided in Section 6(g) or Section 7, (i) more than 90 days after the
termination of the Participant's employment by the Company or a Subsidiary or
more than 10 years from the Date of Grant, whichever period is shorter, or (ii)
prior to the expiration of one year from the Date of Grant; provided further,
that, unless otherwise determined by the Committee, the Option may not be
exercised in excess of 50% of the total shares subject to such Option during the
second year after the Date of Grant, 75% during the third year, and 100%
thereafter.

         (c) The Purchase Price of the shares purchased upon the exercise of an
Option shall be paid in full at the time of exercise in cash or, in whole or in
part, by tendering (either actually or by attestation) shares of Common Stock.
The value of each share of Common Stock delivered in payment of all or part of
the Purchase Price upon the exercise of an Option shall be the Fair Market Value
of the Common Stock on the date the Option is exercised. Exercise of Options

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shall also be permitted, if approved by the Committee, in accordance with a
cashless exercise program under which, if so instructed by a Participant, shares
of Common Stock may be issued directly to the Participant's broker or dealer
upon receipt of an irrevocable written notice of exercise from the Participant.

         (d) The Committee, upon such terms and conditions as it shall deem
appropriate, may (but shall not be obligated to) authorize on behalf of the
Company the acceptance of the surrender of the right to exercise an Option or a
portion thereof (but only to the extent and in the amounts that such Option
shall then be exercisable) and the payment by the Company therefor of an amount
equal to the excess of the Fair Market Value on the date of surrender of the
shares of Common Stock covered by such Option or portion thereof over the
aggregate option price of such shares. Such payment shall be made in shares of
Common Stock (valued at such Fair Market Value) or in cash, or partly in cash
and partly in shares of Common Stock, as the Committee shall determine. The
shares of Common Stock covered by any Option or portion thereof, as to which the
right to exercise shall have been so surrendered, shall not again be available
for the purposes of this Plan.

         (e) Each Option granted under this Plan shall not be transferable by
the Participant otherwise than by will or the laws of descent and distribution,
and shall be exercisable, during the Participant's lifetime, only by the
Participant. Notwithstanding the foregoing, Non-Qualified Stock Options may be
transferable, without payment of consideration, to immediate family members of
the Participant or to trusts or partnerships for the benefit of such family
members.

         (f) The Company, in its sole discretion, shall have the right (but
shall not in any case be obligated) to withhold shares issuable upon the
exercise of an Option granted hereunder sufficient to pay, or to require a
Participant to pay to the Company, the cash amount of any taxes which the
Company is required to withhold upon the exercise of an Option granted
hereunder, provided that anything contained herein to the contrary
notwithstanding, the Committee may, in accordance with such rules as it may
adopt, accept shares of Common Stock received in connection with the exercise of
the Option being taxed or otherwise previously acquired in satisfaction of any
withholding requirements or up to the entire tax liability arising from the
exercise of such Option.

         (g) The Committee, in its sole discretion, shall have the right (but
shall not in any case be obligated), exercisable at any time after the Date of
Grant, to permit the exercise of any Option prior to the time such Option would
otherwise become exercisable under the terms of the Award Agreement.

         (h) The Committee shall have the authority to specify, either at the
time of grant of an Option or at a later date, that upon exercise of all or a
portion of that Option (the "Original Option") a reload stock option ("Reload
Option") shall be granted under specified conditions. A Reload Option shall
entitle the Participant to purchase a number of shares equal to the shares
delivered in payment of all or part of the exercise price of the Original Option
pursuant to Section 6(c) plus the shares delivered or withheld to satisfy the
tax liability associated with such exercise pursuant to Section 6(g). The
specific terms and conditions applicable for Reload

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Options shall be determined by the Committee and shall be set forth in rules
adopted by the Committee or in agreements or other documentation evidencing such
Reload Options; provided, however, that (i) the exercise price of the Reload
Option shall be the Fair Market Value of the Common Stock at the Date of Grant,
(ii) the Reload Option shall not be exercisable, except as provided in Section
6(g) or Section 7, earlier than six months after its Date of Grant, and (iii)
the expiration date of the Reload Option shall not be later than the expiration
date of the Original Option.

7.       EXERCISE OF OPTIONS UPON TERMINATION OF EMPLOYMENT

         (a) If a Participant shall retire or shall cease to be employed by the
Company or by a Subsidiary by reason of Permanent Disability or after a Change
in Control, all Options theretofore granted to such Participant, whether or not
previously exercisable, may be exercised in whole or in part, and/or the
Committee may authorize the acceptance of the surrender of the right to exercise
such Options or any portion thereof as provided in Section 6(d), at any time
within 90 days after such Retirement, termination by reason of Permanent
Disability, or termination after a Change in Control (or such longer period as
may be permitted by the Committee), but not after the expiration of the term of
the Option.

         (b) If a Participant shall die while employed by the Company or by a
Subsidiary or within 90 days of the cessation or termination of such employment
under circumstances described in Section 7(a) (or such longer period as may be
permitted by the Committee), all Options theretofore granted to such
Participant, whether or not previously exercisable, may be exercised in whole or
in part, and/or the Committee may authorize the acceptance of the surrender of
the right to exercise such Options or any portion thereof as provided in Section
6(d), by the estate of such Participant (or by a person who shall have acquired
the right to exercise such Option by bequest or inheritance), at any time within
one year after the death of such Participant but not after the expiration of the
term of the Option.

         (c) If a Participant's employment is terminated for any reason other
than death, disability or retirement or after a Change in Control, such
Participant may exercise any Option in whole or in part, at any time within 90
days after such termination of employment, but only to the extent such Option is
exercisable at the date of termination in accordance with Section 6(b). In no
event may any Option be exercised after the expiration of the term of the
Option.

8.       GRANT OF RESTRICTED SHARES

         (a) The Committee may grant to any Participant an Award of such number
of shares of Common Stock on such terms, conditions and restrictions, whether
based on performance standards, periods of service, retention by the Participant
of ownership of specified shares of Common Stock or other criteria, as the
Committee shall establish. The terms of any Restricted Share Award granted under
this Plan shall be set forth in an Award Agreement which shall

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contain provisions determined by the Committee and not inconsistent with this
Plan and may include awards granted under the Huttig Building Products, Inc. EVA
Incentive Compensation Plan, in accordance with Section 7(b) thereunder.

         (b) As soon as practicable after the Date of Grant of a Restricted
Share Award by the Committee, the Company shall cause to be transferred on the
books of the Company or its agent, shares of Common Stock, registered on behalf
of the Participant, evidencing the Restricted Shares covered by the Award,
subject to forfeiture to the Company as of the Date of Grant if an Award
Agreement with respect to the Restricted Shares covered by the Award is not duly
executed by the Participant and timely returned to the Company. All shares of
Common Stock covered by Awards under this Section 8 shall be subject to the
restrictions, terms and conditions contained in the Plan and the applicable
Award Agreements entered into by the appropriate Participants. Until the lapse
or release of all restrictions applicable to an Award of Restricted Shares the
share certificates representing such Restricted Shares may be held in custody by
the Company, its designee, or, if the certificates bear a restrictive legend, by
the Participant. Upon the lapse or release of all restrictions with respect to
an Award as described in Section 8(e), one or more share certificates,
registered in the name of the Participant, for an appropriate number of shares
as provided in Section 8(e), free of any restrictions set forth in the Plan and
the related Award Agreement shall be delivered to the Participant.

         (c) Beginning on the Date of Grant of a Restricted Share Award and
subject to execution of the related Award Agreement as provided in Section 8(b),
and except as otherwise provided in such Award Agreement, the Participant shall
become a stockholder of the Company with respect to all shares subject to the
Award Agreement and shall have all of the rights of a stockholder, including,
but not limited to, the right to vote such shares and the right to receive
dividends; provided, however, that any shares of Common Stock or other
securities distributed as a dividend or otherwise with respect to any Restricted
Shares as to which the restrictions have not yet lapsed, shall be subject to the
same restrictions as such Restricted Shares and held or restricted as provided
in Section 8(b).

         (d) None of the Restricted Shares may be assigned or transferred (other
than by will or the laws of descent and distribution or to an inter vivos trust
with respect to which the Participant is treated as the owner under Sections 671
through 677 of the Code), pledged or sold prior to the lapse of the restrictions
applicable thereto.

         (e) Upon expiration or earlier termination of the forfeiture period
without a forfeiture and the satisfaction of or release from any other
conditions prescribed by the Committee, or at such earlier time as provided
under the provisions of Section 8(i), the restrictions applicable to the
Restricted Shares shall lapse. As promptly as administratively feasible
thereafter, subject to the requirements of Section 8(k), the Company shall
deliver to the Participant or, in case of the Participant's death, to the
Participant's Beneficiary, one or more share certificates for the appropriate
number of shares of Common Stock, free of all such restrictions, except for any
restrictions that may be imposed by law.

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         (f) A Participant's Restricted Share Award shall not be contingent on
any payment by or consideration from the Participant other than the rendering of
services.

         (g) The Committee will have the discretion, as to any Restricted Share
Award, to award a separate cash amount, payable to the Participant at the time
when the forfeiture restrictions on the Restricted Shares lapse or at such
earlier time as the Participant may elect to be taxed with respect to such
Restricted Shares equal to (i) the federal income tax and the Section 4999
golden parachute excise tax, if any, payable with respect to the lapse of such
restrictions or with respect to such election, divided by (ii) one (1) minus the
total effective federal income and excise tax rate applicable as a result of the
lapse of such restrictions or a result of such election.

         (h) Subject to Sections 8(i) and 8(j), Restricted Shares shall be
forfeited and returned to the Company and all rights of the Participant with
respect to such Restricted Shares shall terminate unless the Participant
continues in the service of the Company or a Subsidiary until the expiration of
the forfeiture period for such Restricted Shares and satisfies any and all other
conditions set forth in the Award Agreement. The Committee shall determine the
forfeiture period (which may, but need not, lapse in installments) and any other
terms and conditions applicable with respect to any Restricted Share Award.

         (i) Notwithstanding anything contained in this Section 8 to the
contrary, the Committee may, in its sole discretion, waive the forfeiture period
and any other conditions set forth in any Award Agreement under appropriate
circumstances (including the death, disability or Retirement of the Participant
or a material change in circumstances arising after the date of an Award) and
subject to such terms and conditions (including forfeiture of a proportionate
number of the Restricted Shares) as the Committee shall deem appropriate.

         (j) Unless otherwise provided by the Committee in the applicable Award
Agreement, in the event of a Change in Control, all restrictions applicable to
the Restricted Share Award shall terminate fully and the Participant shall
immediately have the right to the delivery of share certificates for such shares
in accordance with Section 8(e).

         (k) The Company shall have the right (but shall not in any case be
obligated), in its sole discretion, to withhold shares required to be delivered
upon expiration of restrictions sufficient to pay, or to require a Participant
to pay to the Company, the cash amount of any taxes which the Company is
required to withhold with respect to any amount payable and/or shares issuable
under such Participant's Award. The Company may defer payment of cash or
issuance of shares upon exercise or vesting of an Award unless indemnified to
its satisfaction against any liability for any such tax. The amount of such
withholding or tax payment shall be determined by the Committee and shall be
payable by the Participant at such time as the Committee determines.

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9.       ADJUSTMENTS TO REFLECT CAPITAL CHANGES

         In the event that there is an increase in the number of issued shares
of the Common Stock by reason of any stock dividend, stock split,
recapitalization or other similar event, the total number of shares available
for Awards under the Plan and the number of shares remaining subject to purchase
under each outstanding Option shall be increased and the price per share of such
outstanding Options shall be decreased, in proportion to such increase in issued
shares. Conversely, in case the issued shares of Common Stock shall be combined
into a smaller number of shares, the total number of shares available for Awards
under the Plan and the number of shares remaining subject to purchase under each
outstanding Option shall be decreased and the price per share of such
outstanding Options shall be increased, in proportion to such decrease in issued
shares. In the event of any Merger, the Committee may make such adjustment in
the shares available for Awards under the Plan and the shares subject to
outstanding Awards and the price thereof, if applicable, as the Committee, in
its sole discretion, deems appropriate. In the event of an exchange of Common
Stock, or other securities of the Company convertible into Common Stock, for the
stock or securities of another corporation, the Committee may, in its sole
discretion, equitably substitute such new stock or securities for a portion or
all of the shares of Common Stock subject to outstanding Awards.

10.      AMENDMENT AND TERMINATION

         This Plan may be amended or terminated at any time by the Board except
with respect to any Awards then outstanding, and any Award granted under this
Plan may be terminated at any time with the consent of the Participant. The
Board may make such changes in and additions to this Plan as it may deem proper
and in the best interest of the Company; provided, however, that no such action
shall, without the consent of the Participant, materially impair any Award
theretofore granted under this Plan.

11.      GENERAL PROVISIONS

         (a) Each Option granted under this Plan shall be evidenced by a written
Award Agreement containing such terms and conditions as the Committee may
require, and no person shall have any rights under any Award granted under this
Plan unless and until such agreement has been executed and delivered by the
Company and, if required by the Committee, by the Participant.

         (b) In the event of any conflict between the terms of this Plan and any
provision of any Option agreement, the terms of this Plan shall be controlling.

         (c) No Participant or other person shall have any claim of right to be
granted an Award under the Plan. Neither the Plan nor any action taken hereunder
shall be construed as giving any Participant any right to be retained in the
employ of the Company or any of its Subsidiaries.

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Unless otherwise agreed by contract, the Company reserves the right to terminate
its employment relationship with any person at any time and for any reason.

         (d) Income realized as a result of a grant or an exercise of any Award
under this Plan shall not be included in the Participant's earnings for the
purpose of any benefit plan in which the Participant may be enrolled or for
which the Participant may become eligible unless otherwise specifically provided
for in such plan.

         (e) The obligation of the Company to sell and deliver shares of Common
Stock with respect to any Award granted hereunder shall be subject to, as deemed
necessary or appropriate by counsel for the Company, (i) all applicable laws,
rules and regulations and such approvals by any governmental agencies as may be
required, including, without limitation, the effectiveness of a registration
statement under the Securities Act of 1933, and (ii) the condition that such
shares shall have been duly listed on such stock exchanges as the Common Stock
is then listed.

         (f) Anything in this Plan to the contrary notwithstanding, it is
expressly agreed and understood that if any one or more provisions of this Plan
shall be illegal or invalid such illegality or invalidity shall not invalidate
this Plan or any other provisions thereof, but this Plan shall be effective in
all respects as though the illegal or invalid provisions had not been included.

         (g) All determinations made and actions taken pursuant to the Plan
shall be governed by the laws of the State of Delaware, other than the conflict
of laws provisions thereof, and construed in accordance therewith.

         (h) This Plan shall be unfunded and the Company shall not be required
to segregate any assets that may at any time be represented by Awards under this
Plan. Neither the Company, any of its Subsidiaries, the Committee, nor the Board
shall be deemed to be a trustee of any amounts to be paid under this Plan nor
shall anything contained in this Plan or any action taken pursuant to its
provisions create or be construed to create a fiduciary relationship between the
Company and/or its Subsidiaries, and a Participant. To the extent any person
acquires a right to receive an Award under this Plan, such right shall be no
greater than the right of an unsecured general creditor of the Company.

                                       11<PAGE>
                                                                     Exhibit 4.3

                                BAYER CORPORATION
                          EMPLOYEE SHARE PURCHASE PLAN

                                    ARTICLE I
                                     GENERAL

1.1      Purpose

         The Bayer Corporation Employee Share Purchase Plan (the "Plan") is
intended to encourage employee participation in the ownership and economic
progress of Bayer Aktiengesellschaft. The Plan is not intended to qualify under
Section 423 of the Internal Revenue Code of 1986, as amended.

1.2      Definitions

         Unless the context clearly indicates otherwise, the following terms
have the meanings set forth below:

         "ADS Purchase Agreement" shall mean the form or procedure prescribed by
the Corporation in order to participate in the Plan.

         "ADS Purchase Fund" shall have the meaning prescribed in Section 4.1.

         "ADSs" shall mean the sponsored American Depositary Shares of Bayer AG,
each of which represents one ordinary share of Bayer AG.

         "Affiliate" shall mean any entity controlling, controlled by or under
common control with the Corporation.

         "Bayer AG" shall mean Bayer Aktiengesellschaft.

         "Beneficiary" means the person(s) or estate entitled to receive a
Participant's Plan Account as a result of the death of that Participant.

         "Board" shall mean the Board of Directors of the Corporation.

         "Compensation" means, for all purposes of the Plan except as otherwise
specified, an Employee's base remuneration from the Corporation or a Designated
Participating Company received during a Purchase Period. For purposes of this
provision--

         (1)      Compensation shall include any overtime pay, commissions,
                  shift differentials, bilingual adjustments, and bonus
                  payments; provided, however, that any payments received under
                  the Productivity Plu$ Plan, or any similar plan, shall be
                  excluded.

<PAGE>

         (2)      Compensation shall include any Employee deferrals pursuant to
                  a cash or deferred arrangement under section 401(k) of the
                  Code and any amounts excluded from wages by reason of an
                  election to reduce wages in order to receive benefits under
                  section 125 of the Code.

         (3)      Compensation shall not include payments by reason of
                  termination of employment (such as severance pay), deferrals
                  or payments under any nonqualified deferred compensation
                  arrangement, payments under any long-term incentive
                  compensation program, special awards not specifically included
                  under paragraph (1), noncash compensation (such as any income
                  resulting from participation in this Plan), reimbursement of
                  expenses, foreign service premiums, tax equalization payments,
                  attendance and safety awards, or any other unearned income.

         "Corporation" shall mean Bayer Corporation.

         "Custodial Account" shall mean an account established pursuant to the
Custodial Agreement to hold the ADSs and other assets attributable to Plan
Accounts.

         "Custodial Agreement" shall mean an agreement between the Corporation
and the Custodian.

         "Custodian" shall mean the entity or entities designated from time to
time in a Custodial Agreement to hold assets attributable to Plan Accounts.

         "Designated Participating Company" shall mean any Affiliate that has
(i) been designated by the Corporation to participate under the Plan and (ii)
adopted the Plan for the benefit of its employees.

         "Disability" shall mean the Employee's receipt of long term disability
benefits under a disability plan sponsored by the Corporation or any Designated
Participating Company.

         "Employee" means any person who is employed by the Corporation or a
Designated Participating Company and scheduled to work at least twenty (20)
hours per week. For purposes of eligibility to participate in the Plan, the term
"Employee" shall include an individual covered by a collective bargaining
agreement between employee representatives and the Corporation or a Designated
Participating Company unless the collective bargaining agreement or the
collective bargaining agent expressly prohibits participation in the Plan. The
term "Employee" shall also not include an individual transferred to an entity
that is not a Designated Participating Company or classified by the Corporation
or a Designated Participating Company as a casual, seasonal, co-op or temporary
employee, student intern, work-study student or contract or independent contract
employee.

                                      -2-
<PAGE>

         "Fair Market Value" of an ADS will be the closing trading price on the
trading day immediately preceding the Purchase Date or such other reasonable
method of determining fair market value as the Corporation may adopt from time
to time.

         "Notice of Withdrawal" shall mean the form or procedure prescribed by
the Corporation in order to voluntarily withdraw from the Plan.

         "Participant" shall mean any Employee who elects to participate.

         "Plan" shall mean this Bayer Corporation Employee Share Purchase Plan,
as the same may be amended from time to time.

         "Plan Account" shall mean an account established and maintained under
the Plan in the name of each Participant.

         "Plan Year" shall mean the twelve-month period beginning on January 1
and ending on the following December 31.

         "Purchase Date" shall mean the first business day of each month.

         "Purchase Period" shall mean each period beginning on the first day of
a month and ending on the last business day of that month.

         "Purchase Price" shall mean the purchase price of an ADS as provided in
Section 3.1 hereof.

         "Retirement" shall mean the cessation of an Employee's employment with
the Corporation and all Designated Participating Companies for any reason other
than the Employee's death after the Employee attains age 55 and completes ten or
more "Years of Vesting Service," as defined in and determined under the Bayer
Corporation Pension Plan.

1.3      Administration of Plan

         The Corporation shall administer the Plan and may delegate to any
management committee, employee, director or agent its responsibility to perform
any act hereunder, including without limitation those matters involving the
exercise of discretion, provided that such delegation shall be subject to
revocation at any time at its discretion. The Corporation shall have full
authority to determine all questions arising in connection with the Plan,
including interpreting its provisions and construing all of its terms, may adopt
procedural rules, and may employ and rely on such legal counsel, such actuaries,
such accountants and such agents as it may deem advisable to assist in the
administration of the Plan. All of its rules, interpretations and decisions
shall be applied in a uniform manner to all Participants similarly situated and
decisions of the Corporation shall be final, conclusive and binding on all
persons.

                                      -3-
<PAGE>

1.4      Effective Date of Plan

         The Plan shall be effective on April 1, 2002.

                                   ARTICLE II
                                  PARTICIPATION

2.1      Eligibility

         Each Employee may elect to become a Participant effective as of the
next calendar quarter or as soon thereafter as is administratively possible by
delivering an ADS Purchase Agreement to the Corporation on or before the
fifteenth day of the month preceding the beginning of that calendar quarter.
Once an Employee elects to become a Participant, participation in the Plan will
continue for future pay periods at the same rate selected under Section 2.2
unless his or her participation is terminated in accordance with Article V or
changed in accordance with Article II.

2.2      Payroll Deductions

         Payment for shares of the ADSs purchased hereunder shall be made by
authorized payroll deductions in accordance with a Participant's ADS Purchase
Agreement. A Participant's payroll deduction amount must be expressed as a whole
percentage of not less than 1% and not more than 10% of such Participant's
Compensation; provided, however, that a Participant may not elect to deduct more
than ten thousand dollars ($10,000) in each Plan Year. A Participant may
increase or decrease his or her payroll deduction election for each quarter by
completing the procedures prescribed by the Corporation for such purpose on or
before the fifteenth day of the month preceding the beginning of that calendar
quarter. Payroll deduction amounts shall be credited to a Participant's Plan
Account.

2.3      Beneficiary Designation

         Upon commencing participation, each Participant shall designate a
Beneficiary on forms furnished by the Corporation. Such Participant may then
from time to time change his or her designated Beneficiary by written notice to
the Corporation and, upon such change, the rights of all previously designated
Beneficiaries to receive any benefits under this Plan shall cease. If, at the
date of death of the Participant, no duly designated Beneficiary exists, or if
the Beneficiary designated shall have died prior to the death of the
Participant, or if the Participant has revoked a prior designation by a writing
filed with the Corporation, without having filed a new designation, then any
death benefits which would have been payable to the Beneficiary shall be payable
to the Participant's spouse, if any, at the date of the Participant's death; if
no such spouse is then living, to the Participant's children, equally; or if
none survive, then to the Participant's estate.

                                      -4-
<PAGE>

                                   ARTICLE III
                               PURCHASE OF SHARES

3.1      Purchase Price

         The Purchase Price per share of the ADSs purchased with Participants'
authorized payroll deductions shall be 85% of the Fair Market Value of such
share determined on the Purchase Date.

3.2      Purchase of Shares

         On each Purchase Date, the amount in a Participant's Plan Account shall
be charged with the aggregate Purchase Price of the number of whole and
fractional shares of ADSs that can be purchased with the amount. The Corporation
and each Designated Participating Company shall pay the fees and commissions, if
any, associated with the purchase of ADSs under the Plan.

3.3      Transferability of Rights

         Rights to purchase ADSs hereunder shall be exercisable only by the
Participant. Such rights shall not be transferable.

3.4      Adjustments of Securities

         Bayer AG may adjust the number and class of securities that may be
reserved for purchase, or be purchased, under the Plan in the event that (1)
adjustments are made in the number of outstanding ADSs and/or ordinary shares of
Bayer AG or (2) ADSs and/or ordinary shares of Bayer AG are exchanged for a
different class of securities of Bayer AG or for shares of stock of any other
corporation by reason of a merger, consolidation, stock dividend, stock split or
otherwise.

                                   ARTICLE IV
                                ADS PURCHASE FUND

4.1      ADS Purchase Fund

         The shares of ADSs purchased by Participants under the Plan and any
funds held by the Custodian (the "ADS Purchase Fund") shall be held by one or
more Custodians pursuant to the terms of an agreement between the Corporation
and such Custodian. Employees who authorize payroll deductions for participation
in the Plan will be deemed to have subscribed to the Custodial Agreement and to
have authorized the Custodian to hold and invest their contributions and other
additions to their accounts in accordance with the Plan and the Custodial
Agreement. No person shall have any right to or interest in the ADS Purchase
Fund except as provided in the Plan and Custodial Agreement. Participants'
payroll deductions shall be paid by the Corporation to the Custodian at regular
intervals and credited to Participants' individual accounts in accordance with
the certification of the Corporation, or its delegate, as to the names of the

                                      -5-
<PAGE>

contributing Participants and the amounts contributed by each Participant. No
interest will be paid or credited on any amounts credited to Participants'
individual accounts.

         The ADS Purchase Fund shall be invested in ADSs. Except in the event of
a Participant's Retirement or upon termination of the Plan, dividends received
on ADSs and recovered tax withholdings on such dividends will be used to
purchase additional ADSs at a purchase price equal to the closing trading price
for ADSs on the first trading date after the dividend or tax refund is received
by the Custodian. In the event of a Participant's Retirement, dividends received
on ADSs and recovered tax withholdings on such dividends will be paid directly
to such Participant. The Custodian shall regularly purchase ADSs from time to
time in the open market in accordance with a non-discretionary purchasing
program. Cash balances (including any interim investment thereof) shall not be
maintained in the ADS Purchase Fund except to the extent that such balances are
in anticipation of cash distributions or are maintained in order not to disrupt
the nondiscretionary purchasing program of the Custodian required by the Plan.

         The share of each Participant in the ADS Purchase Fund shall be debited
to such Participants' Plan Account. As of each Purchase Date, the Custodian
shall revalue the fund (exclusive of contributions to be made as of such
Purchase Date) at then current market values and shall certify the value thereof
to the Corporation. As of each Purchase Date, the Corporation, or its delegate,
shall adjust each Plan Account for activity in the period elapsed since the last
preceding Purchase Date by adding together all income received and accrued,
realized and unrealized profits, and deducting therefrom all taxes, charges or
expenses and any realized or unrealized losses which may have been sustained.
The Corporation, or its delegate or delegates, as the case may be, shall
apportion the fund as revalued as of each Purchase Date among the Participants
in proportion to their respective interests in the fund immediately preceding
such Purchase Date. As soon as practicable after the close of each calendar
quarter, or at such more frequent intervals as may be determined by the
Corporation, there shall be sent to each Participant a written statement of the
amount to the credit of his Plan Account as of the last Purchase Date in such
period.

                                    ARTICLE V
                          TERMINATION OF PARTICIPATION

5.1      Voluntary Withdrawal

         A Participant may withdraw from the Plan at any time by filing a Notice
of Withdrawal with the Corporation to be effective as soon as administratively
practicable. Upon withdrawal, the entire cash balance, if any, allocable to that
Participant's Plan Account will be charged for the purchase of whole and
fractional shares of ADSs pursuant to Section 3.2 hereof on the next succeeding
Purchase Date. Any Participant who withdraws from the Plan may again become a
Participant in accordance with Section 2.1 hereof.

                                      -6-
<PAGE>

5.2      Termination of Eligibility

         If a Participant ceases to be eligible under Section 2.1 hereof for any
reason including due to death, Disability, Retirement, cessation of employment
or unpaid leave of absence, the entire cash balance, if any, allocable to that
Participant's Plan Account will be charged for the purchase of whole and
fractional shares of ADSs pursuant to Section 3.2 hereof on the next succeeding
Purchase Date.

                                   ARTICLE VI
                WITHDRAWALS AND DISTRIBUTIONS FROM PLAN ACCOUNTS

6.1      Withdrawals and Distributions From Plan Accounts

         Subject to the terms and conditions set forth below, a Participant may,
at any time, sell or certificate and have delivered to him or her all or a part
of the ADSs recorded in such Participant's Plan Account by completing the
withdrawal process established for this purpose by the Corporation.

         Payment of withdrawal requests will be made in cash or American
Depositary Receipts representing ADSs, as requested by the Participant, and will
be made as soon as administratively practicable following the receipt by the
Corporation of the request. Any expenses relating to the sale or certification
will be borne by the Participant.

         Upon the termination of a Participant's eligibility to participate in
the Plan under Section 5.2 for any reason other than Disability, unpaid approved
leave of absence, Retirement or a change in employment status reducing a
Participant's hours to less than 20 hours per week, an American Depositary
Receipt representing the whole shares of ADSs reflected in that Participant's
Plan Account and a cash payment for the fractional shares of ADSs reflected in
that Participant's Plan Account will be mailed to the Participant after sixty
(60) days unless the Participant directs the sale of the ADSs prior to the
distribution. If the Participant's cessation of employment is based on the
Participant's Disability, unpaid approved leave of absence, Retirement or a
change in employment status reducing a Participant's hours to less than 20 hours
per week, then no distribution will be made until requested by the Participant.

6.2      Application for Distributions

         In order to receive a distribution under the Plan, a Participant or
Beneficiary, as the case may be, must make application therefor in accordance
with procedures prescribed by the Corporation. The Corporation may require that
there be furnished to it in connection with such application all information
pertinent to any question of eligibility and the amount of any distribution. The
Corporation may permit applications for distributions to be made through the
completion and filing of forms provided for this purpose and/or through
electronic, telephonic or computer means, or as otherwise determined by the
Corporation in its sole discretion.

                                      -7-
<PAGE>

                                   ARTICLE VII
                          VOTING AND TENDERING OF ADSs

         Each Participant (or in the event of his death, his Beneficiary or
estate) shall have the right to instruct the Custodian as to the manner in which
to (1) exercise voting rights at each annual and each special meeting of the
stockholders of Bayer AG, and/or (2) respond to a voluntary tender or exchange
offer with respect to ADSs credited to such Participant's account under the
Plan. The Corporation shall utilize its best efforts to distribute on a timely
basis or cause to be distributed to each Participant (or Beneficiary or estate)
such information as will be distributed to holders of the ADSs in connection
with any such meeting or voluntary tender or exchange offer, together with an
appropriate form for the Participant to indicate his instructions. Upon its
receipt of such instructions, the Custodian shall cause the voting or tender of
such ADSs as and to the extent so instructed. It is the intent of this provision
of the Plan to treat all such Participants (or their Beneficiaries or their
estates) as if they held directly all ADSs to the credit of their account under
the Plan so that if a Participant (or Beneficiary or estate) does not instruct
the Custodian to vote, tender or exchange such ADSs at a stockholder meeting or
pursuant to the terms of any voluntary tender or exchange offer, the Custodian
shall conclude that such Participant does not wish to have his ADSs voted,
tendered or exchanged. The Custodian shall have no discretion in such matter and
shall take no action with respect to any such meeting, or voluntary tender or
exchange offer except to the extent it receives instructions from Participants.
The Custodian shall keep confidential all instructions it receives pursuant to
this Article VII, except the aggregate number of votes voting for or against or
abstaining with respect to a matter submitted to a stockholder vote.

                                  ARTICLE VIII
                   PLAN AMENDMENT, MODIFICATION OR SUSPENSION

         The Plan may be amended, modified or suspended in whole or in part, at
any time and from time to time by the Corporation; provided, however, that no
such amendment, modification or suspension (i) shall adversely affect in a
material manner any right of any Participant with respect to amounts credited to
such Participant's Plan Account prior to the effective date of such amendment,
modification or suspension or (ii) shall require Bayer AG's approval unless such
approval is given by Bayer AG.

                                   ARTICLE IX
                                   TERMINATION

         The Plan may be terminated at any time by appropriate action of the
Corporation and will automatically terminate on the Purchase Date on which an
insufficient number of ADSs remains available for purchase under the Plan. Upon
termination, Plan Accounts will continue to be held under the Plan until
withdrawn or distributed in accordance with the terms of the Plan.

                                    ARTICLE X
                               GENERAL PROVISIONS

10.1     Notices

         Any notice that a Participant files pursuant to the Plan shall be made
on forms prescribed by the Corporation and shall be effective when received by
the Corporation.

                                      -8-
<PAGE>

10.2     Condition of Employment

         Neither the creation of the Plan nor participation therein shall be
deemed to create any right of continued employment or in any way affect the
right of the Corporation to terminate an Employee.

10.3     Withholding

         The Corporation or Designated Participating Employer will have the
right to withhold from any remuneration payable to a Participant any income or
employment taxes required to be withheld as a result of that Participant's
participation in the Plan.

10.4     Governing Law

         The validity, construction, interpretation, administration and effect
of the Plan, and of its rules and regulations, and rights relating to the Plan,
shall be governed by the substantive laws, but not the choice of law rules, of
the Commonwealth of Pennsylvania.

                                      -9-

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