Document:

Prepared by R.R. Donnelley Financial -- Agreement with Hyseq, Inc dated October 9, 2001

 EXHIBIT 10.32 
  
 SECRETED PROTEIN 
  
 DEVELOPMENT AND COLLABORATION AGREEMENT

  
 THIS SECRETED PROTEIN DEVELOPMENT AND COLLABORATION AGREEMENT (this “Agreement”) is entered
into and made on October 9, 2001 (the “Effective Date”) by and between DELTAGEN, INC. (“DELTAGEN”), a corporation organized and existing under the laws of the state of Delaware and having a principal place of
business at 1003 Hamilton Avenue, Menlo Park, California 94025 and HYSEQ, INC. (“HYSEQ”) a corporation incorporated and existing under the laws of the state of Nevada having a principal place of business at 670 Almanor Avenue,
Sunnyvale, California 94085-3513. DELTAGEN and HYSEQ are both referred to herein as “Parties” or each individually, as a “Party.” 
  
 RECITALS 
  
 WHEREAS, HYSEQ is in the business of applying its
proprietary genomics platform and utilizing its proprietary sequencing-by-hybridization technology to find and develop biopharmaceuticals products and has discovered and identified genes encoding for secreted proteins that may have potential as
therapeutic proteins; and 
  
 WHEREAS, DELTAGEN possesses certain knowledge and experience in the design, generation,
and phenotypic analysis of transgenic animals, including knock-out mice and has technologies useful in determining the in vivo function of mammalian genes; and 
  
 WHEREAS, HYSEQ and DELTAGEN each desire, on the terms and conditions contained herein, to collaborate on the discovery, research, development and commercialization of
biopharmaceutical products through the analysis and study of human gene sequences provided by HYSEQ; and 
  
 WHEREAS,
in connection with this collaboration, HYSEQ will contribute, in accordance with the terms and conditions of this Agreement, human gene sequences and a corresponding murine ortholog sequence sufficient for the Steering Committee to designate [***]
Project Genes to the collaboration and will grant licenses covering such genes and related technology and derivatives thereof; and 
  
 WHEREAS, DELTAGEN will, in accordance with the terms and conditions of this Agreement, create ES cell lines and generate knock-out mice based on [***] Project Genes and 
 

 

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 their orthologous murine gene sequences, as identified by HYSEQ, and DELTAGEN will study and analyze
such knock-out mice to identify secreted proteins for further development and commercialization by the Parties; and 
  
 WHEREAS, the Parties shall undertake research and development programs as determined by the Parties on the terms and conditions set forth in this Agreement. 
  
 NOW, THEREFORE, in consideration of the mutual covenants contained herein, and for other good and valuable consideration, the amount and sufficiency of which are hereby
acknowledged, the Parties hereby agree as follows: 
  
 ARTICLE 1 
  

DEFINITIONS 
  
 1.1    “Additional Tests” shall have the meaning set forth in Section 5.4.1. 
  
 1.2    “Affiliate” means at the time of determination any Person which directly or indirectly is controlled by, controls or is under common control
with any Party hereto. “Control” shall in this context mean ownership of greater than fifty percent (50%) of the voting stock or other interests in the Person in question. In any country of the Territory in which local law prohibits the
ownership by DELTAGEN or HYSEQ of greater than fifty percent (50%) of the voting stock or other interests of an entity, the entity shall be deemed an Affiliate of DELTAGEN or HYSEQ, as applicable, if DELTAGEN or HYSEQ owns the maximum percentage
permitted by law, as long as such maximum percentage is at least thirty percent (30%). 
  
 1.3    “Agency” means any governmental regulatory authority responsible for granting approvals for the sale of a product.   
  
 1.4    “DeltaBase” means DELTAGEN’s functional genomics database and
software. 
  
 1.5    “DELTAGEN Knock-Out Technology” means
all Technical Information that is owned or controlled by DELTAGEN as of the Effective Date or developed solely by DELTAGEN during the Term of this Agreement relating to any methods of making, generating, producing, creating, breeding and/or
analyzing transgenic animals, including Knockout Mice, or libraries, clones, plasmids, constructs and vectors used in such methods (including ES cell lines and frozen sperm). 
 

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THE SECURITIES EXCHANGE ACT OF 1934, AS AMENDED. 

  
 1.6    “Derivative
Protein” means (i) any fragment of a Secreted Protein, or (ii) any altered form of a Secreted Protein or a fragment thereof, including amino acid substitutions, additions, deletions, and C- and N-terminal fusions. 

 
 1.7    “Derived” or “derived” means obtained,
developed, created, tested, identified, discovered, synthesized, designed, derived or resulting from, based upon or otherwise generated (whether directly or indirectly, or in whole or in part), and anything so derived shall be referred to herein as
“derivatives.” 
  
 1.8    “Development Program” shall
have the meaning set forth in Section 3.1. 
  
 1.9    “First Pass
Phenotypic Analysis” means the tests, observations, and analyses listed on Exhibit A. 
  
 1.10    “FTE” means the equivalent of one person with at least a bachelor’s degree providing scientific, pre-clinical, clinical trial, or regulatory work on a full-time basis
(i.e., no less than a total of [***] hours per calendar year, prorated in the case of a partial calendar year). Any FTE charge for the FTEs dedicated to the applicable matter shall be the number of hours each FTE of a Party directly spent on
the applicable matter billed at a rate equal to the cost incurred by such Party for such FTE, but not exceeding [***] per calendar year, which rate includes salary and benefits. 
  
 1.11    “HYSEQ Know-How” means any and all Technical Information that is solely owned or controlled by HYSEQ as of the
Effective Date or developed solely by HYSEQ during the Term of this Agreement that relates to any Proposed Gene or any Project Gene, as applicable, or any mutation, fragment, allelic variant, analog, homolog or ortholog of any Proposed Gene or
Project Gene, as applicable, and/or any expression products and/or derivatives thereof. 
  
 1.12    “HYSEQ Patents” means all Patents in any country in the Territory that are solely owned or controlled by HYSEQ as of the Effective Date or developed solely by HYSEQ during
the Term that relate to any Proposed Gene or any Project Gene, as applicable, or any mutation, fragment, allelic variant, analog, homolog or ortholog of any Proposed Gene or any Project Gene, as applicable, and/or any expression products and/or
derivatives thereof, 
  
 1.13    “Initial Murine Gene Analysis”
means the conduct of studies and analysis to 
 

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 identify a murine gene sequence orthologous to a Submitted Gene through HYSEQ’S standard resources.

  
 1.14    “Joint Project Intellectual Property, DELTAGEN Project Intellectual
Property and HYSEQ Project Intellectual Property” (collectively, “Project Intellectual Property”) shall have the meanings set forth in Section 10.1.1. 
  
 1.15    “Joint Project Patents, DELTAGEN Project Patents and HYSEQ Project Patents” (collectively, “Project
Patents”) shall have the meanings set forth in Section 10.1.1. 
  
 1.16    “Loss” has the meaning set forth in Section 8.1. 
  
 1.17    “Patent(s)” means any patent, provisional or patent application, and all additions, divisions, continuations, continuations-in-part, substitutions, reissues,
extensions, registrations, supplementary protection certificates and renewals of any of the foregoing. 
  
 1.18    “Payment One,” “Payment Two,” Payment Three” and “Total Payment”shall have the meanings set forth in Section 5.1.  

 
 1.19    “Person” means a person, corporation, partnership, limited liability
company or any other entity. 
  
 1.20    “ConflictingPipeline” means a gene or gene sequence that, as of the date submitted by HYSEQ to DELTAGEN Section 4.1.1 of this Agreement, has been designated for
research and development by DELTAGEN for a Third Party. 
  
 1.21    “Project” means the activities of the Parties under the Development Program with respect to a single Project Gene and/or its orthologous Project Murine Gene (and with respect
to any Project Knock-Out Mice, Secreted Proteins, Derivative Proteins, Secreted Protein Candidates and Products derived therefrom), as set forth in the Work Plan in accordance with this Agreement, or as directed by the Steering Committee.

  
 1.22    “Project Knock-Out Mouse” or “Project Knock-out
Mice” means any mouse or mice in which DELTAGEN has, pursuant to this Agreement, interrupted, disrupted, or deleted a specific gene or portion thereof, orthologous to a Project Gene, to inactivate the function of 
 

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 such gene in such mouse or mice. 
  
 1.23    “Product” means any product that contains as an active ingredient (i) a Secreted Protein Candidate (or portion
thereof), or (ii) an agonist or antagonist (including, without limitation, anti-sense, antibodies and small molecules) of a Secreted Protein Candidate. 
  
 1.24    “Project Gene” means a Proposed Gene that has been designated by the Steering Committee as a “project gene” pursuant to Section
4.2. 
  
 1.25    “Project Murine Gene” means a murine gene
sequence that the Steering Committee has designated as the orthologous murine gene for the human gene sequence of a Project Gene. 
  
 1.26    “Proposed Gene” means a gene sequence (i) submitted to the Steering Committee for consideration for inclusion under the Development Program as a “project gene” as
set forth in Section 4.1; (ii) which is believed to encode a Secreted Protein; (iii) for which a patent application has been filed by HYSEQ regarding the human gene sequence and the Secreted Protein believed to be produced by such human gene
sequence; and (iv) its corresponding Project Murine Gene. 
  
 1.27    “Protein” means a high molecular weight (i.e., weighing more than one thousand (1000) daltons), polymer compound composed of a variety of amino acids joined by peptide
linkages, including allelic variants thereof and post-translationally modified variants thereof (i.e., glycosylated proteins).   
  
 1.28    “Rejected Proposed Gene” has the meaning set forth in Section 4.3. 
  
 1.29    “Rejected Project Gene” has the meaning set forth in Section 5.5.3. 
  
 1.30    “Rejected Submitted Gene” has the meaning set forth in Section 4.1.2(b). 
  
 1.31    “Restriction Term” means the period of time a Rejected Project Gene is subject
to the restrictions set forth in Section 5.5.3. Unless a different time period is voted on and approved by a majority of the Steering Committee for a particular Rejected Project Gene, the Restriction Term for such Rejected Project Gene shall
be [***] from the date it becomes a Rejected Project Gene under this Agreement. 
 

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 1.32    “Secreted Protein”
means a Protein or Protein fragment released from a cell. 
  
 1.33    “Secreted Protein Candidate” means a Secreted Protein which the Parties through the Steering Committee have designated as a “secreted protein candidate” pursuant to
Section 5.5.1 and any and all Derivative Proteins thereof. 
  
 1.34    “Submitted Gene” means a human gene coding sequence (i) submitted to DELTAGEN by HYSEQ for consideration for inclusion as a “proposed gene” as set forth in
Section 4.1.1; (ii) which is believed to encode a Secreted Protein; and (iii) for which a patent application has been filed by HYSEQ regarding the human gene sequence and the Secreted Protein] believed to be produced by such human gene
sequence. 
  
 1.35    “Technical Information” means all
technology, know-how, copyrights, trade secrets, software, techniques, data, technical information and all other intellectual property and other proprietary information, including all inventions (whether or not patentable), improvements and
developments, practices, applications, protocols, concepts, biological materials (including nucleic acid sequences, RNA, DNA, organisms, proteins, polypeptides, plasmids and vectors), processes, methods (including methods of use or treatment for
human or murine secreted proteins), pre-clinical, clinical and regulatory data and information, clinical and regulatory strategies, test data, analytical and quality control data, reports, manufacturing information, patent data or descriptions,
development information, drawings, specifications, designs (whether or not registerable), plans, proposals and technical data and manuals, documents, rights in databases, computer data and source code. 
  
 1.36    “Term” has the meaning set forth in Section 11.1. 

 
 1.37    “Territory” means the entire world. 
  
 1.38    “Third Party” means any Person other than a Party to this Agreement or an
Affiliate of either Party. 
  
 1.39    “Valid Claim” means any
claim within an issued, unexpired Patent which (i) has not been held unenforceable, unpatentable or invalid by a decision of a court or other governmental agency of competent jurisdiction following exhaustion of all possible appeal processes and
(ii) has not been abandoned, disclaimed, or admitted to be invalid or unenforceable 
 

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 through reissue, reexamination or disclaimer. 
  
 1.40    “Work Plan” means the work plan developed by the Steering Committee, as may be modified from time to time by the
Steering Committee (initially Exhibit C), that sets forth the responsibilities of the Parties under the Development Program, including in connection with the selection of the Project Genes from Proposed Genes and with respect to the generation and
analysis of the Project Knock-Out Mice. The First Pass Phenotypic Analysis and Exhibit A shall be part of the Work Plan and therefore references to the Work Plan shall include the First Pass Phenotypic Analysis and Exhibit A. 

  
 ARTICLE 2 
  
 LICENSE GRANT 
  
 2.1    HYSEQ
License.    During the Term of this Agreement and subject to the terms and conditions hereof, HYSEQ hereby grants to DELTAGEN the following licenses: 
  
 2.1.1    Submitted Genes.    On a Submitted Gene-by-Submitted Gene basis, a non-exclusive right and
license, until the earlier of (a) the date upon which a Submitted Gene becomes a Rejected Submitted Gene under this Agreement or (b) the date upon which a Submitted Gene becomes a Proposed Gene under this Agreement (at which time the license under
Section 2.1.2 shall become effective), under the HYSEQ Patents and HYSEQ Know-How solely for the purpose of conducting review and analysis activities with respect to such Submitted Gene in accordance with the terms and conditions of this Agreement
including determining whether such Submitted Gene is in Deltagen’s Conflicting Pipeline, and performing an intellectual property analysis with respect to DELTAGEN’s use of such Submitted Genes. 
  
 2.1.2    Proposed Genes.    On a Proposed Gene-by-Proposed Gene
basis, and upon submission by HYSEQ of the information related to such Proposed Genes under Section 4.1.3, a non-exclusive right and license, until the earlier of (a) the date upon which a Proposed Gene becomes a Rejected Proposed Gene under
this Agreement or (b) the date upon which a Proposed Gene becomes a Project Gene under this Agreement (at which time the license under Section 2.1.3 shall become effective), under the HYSEQ Patents and HYSEQ Know-How solely for the purpose of
conducting review and analysis activities with respect to such Proposed Gene in accordance with the terms and conditions of this Agreement, including the Work Plan, 
 

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 including to identify murine gene sequences orthologous to the Proposed Gene if such activities are not already performed
by HYSEQ or if instructed by the Steering Committee. 
  
 2.1.3
    Project Genes.    On a Project Gene-by-Project Gene basis, and upon designation of a Proposed Gene as a Project Gene under this Agreement, a co-exclusive right and license until the
earlier of (a) the date upon which such Project Gene becomes a Rejected Project Gene (at which time the license under Section 2.1.4 shall become effective), or (b) termination of the collaboration in accordance with the provisions of
Section 11.2.2 of this Agreement; including the right to grant sublicenses to Affiliates and Third Party contractors as set forth in Section 2.4, under the HYSEQ Patents and HYSEQ Know-How to perform the following activities: (i) to
analyze and use such Project Gene and any derivatives thereof in accordance with the terms and conditions of this Agreement, including the Work Plan, (ii) to use, make, create, generate, produce, breed, test and conduct research and development
activities in connection with Project Knock-Out Mice and progeny and other derivatives thereof in accordance with the terms and conditions of this Agreement, including the Work Plan, (iii) to use, make, generate, produce, create, isolate, purify,
identify and conduct research and development activities in connection with such Project Gene (and/or any mutation, fragment, allelic variant, analog, homolog or ortholog of such Project Gene and/or any expression products (including any Secreted
Proteins, Derivative Proteins and/or Products) and/or derivatives thereof in accordance with the terms and conditions of this Agreement, including the Work Plan, and (iv) subject to a separate agreement entered into in accordance with Article
6, to develop, make, have made, use, distribute, offer for sale, import, export and sell Products. If the license under this Section 2.1.3 has terminated in accordance with (a) or (b) above, such license shall again become effective until
termination in accordance with (a) or (b) if, in accordance with either Section 5.5.3.1 or Section 5.5.3.2 of this Agreement, the Steering Committee votes to designate a particular Rejected Project Gene a Project Gene again under this
Agreement. 
  
 2.1.4    Rejected Project Genes. 

 
 (a)    On a Rejected Project Gene-by-Rejected Project Gene basis, and upon designation of a
Project Gene as a Rejected Project Gene under this Agreement, a co-exclusive internal use license until the expiration of the Restriction Term (at which time the license under  
 

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 Section 2.1.4(b) shall become effective unless the Steering Committee has otherwise designated the Rejected Project Gene
under Section 5.5.3 and then the terms of that Section shall be controlling) for research purposes only to the Rejected Project Gene and its related Project Murine Gene under the HYSEQ Patents and HYSEQ Know-How to allow DELTAGEN to conduct
similar research activities for itself during the Restriction Term as contemplated for Project Knock-Out Mice and Project Genes under this Agreement. 
  
 (b)    On a Rejected Project Gene-by-Rejected Project Gene basis pursuant to the procedure set forth in Section 5.5.3, and upon
the expiration of the Restriction Term, a non-exclusive right and license, including the right to grant sublicenses (which sublicenses may include the right to grant further sublicenses) under the HYSEQ Patents and HYSEQ Know-How to perform the
following activities: (i) to analyze and use such Rejected Project Gene and any derivatives, (ii) to use, make, create, generate, produce, breed, test and conduct research and development, (iii) to use, make, generate, produce, create, isolate,
purify, identify and conduct research and development, and (iv) to develop, make, have made, use, distribute, offer for sale, import, export and sell products that contain as an active ingredient such Rejected Project Gene, a protein encoded by such
Rejected Project Gene (or portion thereof), or an agonist or antagonist (including, without limitation, anti-sense, antibodies and small molecules) of a protein encoded by such Rejected Project Gene. Upon and after grant of such a license to a
Rejected Project Gene under this Section 2.14(b) for which HYSEQ has royalty obligations to a Third Party, DELTAGEN will (i) notify HYSEQ when any and all sublicenses are granted, (ii) notify HYSEQ upon commencement of sales of any and all
products that contain as an active ingredient a Rejected Project Gene, a protein encoded by such Rejected Project Gene (or portion thereof), or an agonist or antagonist (including, without limitation, anti-sense, antibodies and small molecules) of a
protein encoded by such Rejected Project Gene, (iii) calculate and reimburse HYSEQ for any and all royalty payments that HYSEQ is obligated to pay to any Third Party as a result of sales of such a product by or on behalf of DELTAGEN, DELTAGEN’s
Affiliates or DELTAGEN’s sublicensees, within thirty (30) days after the date such payments are required and in accordance with a royalty formula to be provided by HYSEQ, and (iv) keep complete and accurate records of sales of any such products
and allow a reasonable yearly audit by a third party independent auditor of such records, (at DELTAGEN’s expense if the results 
 

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 show an error in favor of HYSEQ), in order to verify sales subject to the royalty obligation. In addition to any other
remedies available to HYSEQ under this Agreement, HYSEQ shall have the right to terminate the license under this paragraph upon written notice to DELTAGEN if DELTAGEN materially breaches its obligations to reimburse HYSEQ for royalties under this
Section 2.1.4(b). 
  
 2.2    Co-Exclusive
License.    The term “co-exclusive” as used herein shall operate to exclude all other Persons, except for HYSEQ or DELTAGEN, as applicable. 
  
 2.3    DELTAGEN License.    Subject to the terms and conditions of this Agreement, DELTAGEN hereby grants to
HYSEQ the following licenses: 
  
 2.3.1    Project
Genes.    On a Project Gene-by-Project Gene basis, and upon designation of a Proposed Gene as a Project Gene under this Agreement, a co-exclusive right and license until the earlier of (a) the date upon which such Project
Gene becomes a Rejected Project Gene, or (b) termination of the collaboration in accordance with the provisions of Section 11.2.2 of this Agreement; including the right to grant sublicenses to Affiliates and Third Party contractors as set
forth in Section 2.4, under the DELTAGEN Knock-Out Technology and DELTAGEN Project Intellectual Property, and subject to a separate agreement entered into in accordance with Article 6, to develop, make, have made, use, distribute,
offer for sale, import, export and sell Products.  
  
 2.3.2    Rejected Project Genes.  
  
 (a)    On a Rejected Project Gene-by-Rejected Project Gene basis, and upon designation of a Project Gene as a Rejected Project Gene under this Agreement, a co-exclusive internal use license until the
expiration of the Restriction Term (at which time the license under Section 2.3.2(b) shall become effective unless the Steering Committee has otherwise designated the Rejected Project Gene under Section 5.5.3 and then the terms of that
Section shall be controlling) for research purposes only to the Rejected Project Gene and its related Project Murine Gene under the DELTAGEN Knock-Out Technology and DELTAGEN Project Intellectual Property to allow HYSEQ to conduct similar
research activities for itself during the Restriction Term as contemplated for Project Knock-Out Mice and Project Genes under this Agreement.  
 

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 (b)    On a Rejected Project
Gene-by-Rejected Project Gene basis pursuant to the procedure set forth in Section 5.5.3, and upon the expiration of the Restriction Term, a non-exclusive right and license, including the right to grant sublicenses (which sublicenses may
include the right to grant further sublicenses) under the DELTAGEN Knock-Out Technology and DELTAGEN Project Intellectual Property to perform the following activities: (i) to analyze and use such Rejected Project Gene and any derivatives, (ii) to
use, make, create, generate, produce, breed, test and conduct research and development, (iii) to use, make, generate, produce, create, isolate, purify, identify and conduct research and development, and (iv) to develop, make, have made, use,
distribute, offer for sale, import, export and sell products that contain as an active ingredient a Rejected Project Gene, a protein encoded by such Rejected Project Gene (or portion thereof), or an agonist or antagonist (including, without
limitation, anti-sense, antibodies and small molecules) of a protein encoded by such Rejected Project Gene. 
  
 2.4    Sublicenses.    The licenses granted to each Party pursuant to Sections 2.1.3, 2.1.4(b), 2.3.1 and 2.3.2(b) include the right to sublicense all or part of
such rights to such Party’s Affiliates and/or to Third Party contractors to perform any obligations of such Party under the Development Program (with respect to Sections 2.1.3 and 2.3.1), provided that such Party provides written notice
to the other Party of any such sublicense and the terms and conditions of such grant of sublicense (i) are consistent with and do not violate the terms and conditions of this Agreement, and (ii) ensure that such Persons are obligated in writing to
comply with the terms and conditions of this Agreement, including being bound by obligations of confidentiality which are comparable to, or more stringent than, the provisions of Article 9. Notwithstanding anything to the contrary in this
Agreement, if the Steering Committee designates a Proposed Gene as a Project Gene for work by DELTAGEN after being informed pursuant to Section 4.1.3 that HYSEQ has already submitted the corresponding Proposed Gene to a Third Party contractor
for analysis under a legally binding contract for such Proposed Gene, then HYSEQ shall be authorized under this paragraph to license or sublicense to the Third Party contractor for the purposes of conducting such analysis. The results of such
analysis shall be reported to the Steering Committee. 
  
 2.5    No Implied Rights
or Licenses.    No right or license is granted under this Agreement 
 

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 by either Party to the other Party, either expressly or by implication, except as expressly set forth herein. 
  
 2.6    Other Activities of the Parties.    During the Term, neither
Party shall, either itself or through or with any Affiliate or Third Party, (a) use or conduct any [***] with respect to any Proposed Genes (unless and until such Proposed Genes are Rejected Project Genes), Project Genes, Project Knock-Out Mice,
Project Murine Genes, Secreted Proteins, Derivative Proteins, Secreted Protein Candidates or Products, except if and to the extent expressly permitted under this Agreement or as otherwise mutually agreed by the Parties in writing, whether pursuant
to Article 6 or otherwise; or (b) [***] any Proposed Genes (unless and until such Proposed Genes are Rejected Project), Project Genes, Project Knock-Out Mice, Project Murine Genes, Secreted Proteins, Derivative Proteins, Secreted Protein
Candidates or Products that are subject to this Agreement, including with respect to any progeny, mutations, fragments, allelic variants, analogs, homologs or orthologs, and/or any expression products (including any such Secreted Proteins,
Derivative Proteins and/or Products) or derivatives of any of the foregoing. 
  
 ARTICLE 3 
  
 DEVELOPMENT PROGRAM AND STEERING COMMITTEE 
  
 3.1    Development Program. 
  
 3.1.1    Overview of Development Program.    HYSEQ and DELTAGEN shall engage in a development program for the identification, research and development of Secreted
Protein Candidates and Product(s) through the analysis and study of Project Genes provided by HYSEQ, and to generate, study and analyze Project Knock-Out Mice from murine genes orthologous to the Project Genes (the “Development
Program”). Deltagen shall use commercially reasonable efforts to generate ES cells for each of the [***] Project Genes selected pursuant to Section 4.1.1, with the goal of generating two hundred (200) ES cell lines, [***]. After
identification of Secreted Protein Candidates, the Steering Committee shall decide whether to conduct further research and development activities under the Development Program with respect to such Secreted Protein Candidates (and/or any Products
which incorporate such Secreted Protein Candidates), or to develop and commercialize such Secreted Protein Candidates (and/or any Products which incorporate such Secreted Protein Candidates), pursuant to the terms 
 

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 and conditions of a separate agreement, whether in a collaboration between the Parties, or with Third Party partners or
licensees or as otherwise determined by the Steering Committee pursuant to Section 6.2. 
  
 3.1.2    Development Program Costs and Expenses.    The Parties shall share [***] all costs and out-of-pocket expenses arising out of the Development Program other than the
activities under Sections 4.1.3 and 5.3, and as otherwise may be agreed to by the Parties in a separate agreement for the development of a Secreted Protein Candidate or Product. The costs and expenses of activities pursuant to Sections
4.1.3 and 5.3 shall be paid for solely by [***]. 
  
 3.2    Cooperation and
Sharing of Information.    The Parties shall cooperate, coordinate and consult with each other in connection with performing their activities under the Development Program, including under the Work Plan. Each Party shall
also share with the other Party, as determined by the Steering Committee, or as reasonably requested by the other Party, data and information and other Technical Information, derived from their activities under the Development Program, including
with respect to DELTAGEN related data and information arising in connection with DELTAGEN’s analysis and study of the Project Knock-Out Mice under the Work Plan. 
  
 3.2.1    Access to Facilities.    Representatives of each Party, including members of the
Steering Committee, may, upon reasonable notice during normal business hours, (a) visit any facilities where Development Program activities are being conducted, and (b) consult informally, during such visits and by telephone, concerning the
Development Program. The visiting Party’s representatives shall be advised of, and bound by, the confidentiality obligations set forth in Article 9 (or confidentiality obligations that are at least comparable or more stringent than those
set forth in Article 9), and shall follow such security and facility access procedures as directed, and designated by the Party who’s facilities are being visited. The Party whose facilities are being visited may require that the
representatives of the visiting Party be accompanied by its representatives, at all times while the visiting Party is at its facilities. 
  
 3.2.2    Record Keeping.    Each Party shall maintain complete and accurate records in accordance with its internal practices for keeping
such records, in good scientific manner and in appropriate detail for patent and regulatory purposes, of its activities conducted 
 

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 under the Development Program and including such data and materials as are required to be maintained pursuant to
applicable laws and regulations. To the extent practical, such written records shall be kept separately from written records documenting other activities of each Party and shall be maintained on a Project-by-Project basis. 
  
 3.2.3    Compliance.    Each Party shall, and shall ensure
that its employees, consultants, contractors and agents, perform their respective activities under the Development Program in accordance with all applicable laws, rules and regulations in the Territory. 
  
 3.2.4    Updates and Quarterly and Final Reports.    Each
Party shall provide updates to the Steering Committee, on at least a monthly basis, and written reports by the end of each calendar quarter, detailing the then current status and results of the activities of the Parties under the Development
Program, including with respect to DELTAGEN, the then current status and results of the First Pass Phenotypic Analysis for each Project, as set forth in Section 5.3. 
  
 3.3    Steering Committee Responsibilities, Composition and Procedures. 
  
 3.3.1    Organization and Role.    DELTAGEN and HYSEQ shall promptly after the Effective
Date organize a steering committee (the “Steering Committee”) to plan, manage and oversee the Development Program. Without limiting the foregoing, the Steering Committee’s responsibilities shall include the following:

  
 (a)    developing, reviewing, updating and modifying in writing the Work Plan
set forth in Exhibit A and developing the mediation procedure to be set forth in Exhibit B; provided, however, that if the Parties cannot agree, after good faith efforts, to a time frame for generation of the ES lines to be generated from the [***]
Project Genes under this Agreement, then the Work Plan shall be deemed to provide that, within [***] from the date DELTAGEN commences work on such Project Genes, DELTAGEN shall use [***] efforts to generate ES cells for the first [***] Project Genes
(provided all [***] Project Genes have been designated as such upon the beginning of such [***] period) and, within an additional [***], DELTAGEN shall use [***] efforts to generate ES cells for the remaining [***] Project Genes (provided all [***]
remaining Project Genes have been designated as such upon beginning of such [***] period). 
 

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 (b)    designating genes as Project Genes
from the Proposed Genes submitted by HYSEQ to the Steering Committee pursuant to Section 4.1; 
  
 (c)    performing due diligence on each Proposed Gene and reviewing and determining, based on such due diligence, the relative strength of any IP positions around any Project Genes under consideration, and
including such determination in the decision whether to designate a Project Gene as a Secreted Protein Candidate. 
  
 (d)    determining which Project Genes to submit to DELTAGEN for further analysis and study under the Development Program pursuant to Section 5.2; 
  
 (e)    reviewing the First Pass Phenotypic Analysis of each of the Project Genes submitted to DELTAGEN and determining the necessity of
conducting phenotypic testing, observation, or analysis not included in the First Pass Phenotypic Analysis (including any further research and development activities to be conducted by any Third Parties) and which, if any, of such additional
phenotypic tests, observations, or analyses are appropriate, as set forth in Article 5; 
  
 (f)    determining the necessity of conducting further research and development on each of the Project Genes (including any further research and development activities to be conducted by any Third Parties);
provided, however, that the foregoing shall in no ay limit HYSEQ’s right to independently conduct such further research and development in accordance with the terms and conditions of this Agreement, such information to be provided to the
Steering Committee for such Project Gene in accordance with the terms and conditions of this Agreement; 
  
 (g)    determining, under Section 5.5.1, which, if any, of the Secreted Proteins together with the Derivative Proteins, will be designated as “secreted protein candidates”; 

 
 (h)    reviewing the Parties’ reports and updates in connection with their respective
activities under the Development Program, including the reports submitted by DELTAGEN pursuant to Section 5.3; and 
 

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 (i)    deciding whether and how to develop
any Secreted Protein Candidates and Products (e.g., whether under a collaboration between the Parties or with Third Party partners or licensees or otherwise), as set forth in Article 6. 
  

3.3.2    Composition.    The Steering Committee shall consist of three (3) members
from DELTAGEN and three (3) members from HYSEQ. Each Party shall have the right to appoint one (1) of its three (3) members to be a co-chairperson of the Steering Committee. The Parties shall each have the right, upon notifying the other, to change
its members of the Steering Committee at any time during the Term. 
  
 3.3.3    Meetings; and Minutes.    The Parties shall hold meetings of the Steering Committee as mutually agreed by the Parties (but in no event less than once each
calendar quarter) to review the Development Program and to discuss future activities under this Agreement. The first meeting of the Steering Committee shall be held within thirty (30) days of the Effective Date. Minutes of all meetings setting forth
decisions of the Steering Committee, including with respect to the Development Program, shall be prepared by one of the Parties, each Party alternating assuming this responsibility at each meeting, and circulated to both Parties within fifteen (15)
days after each meeting, but minutes shall not become official until approved by both Parties (which approval the Parties shall use reasonable efforts to give within fifteen (15) days of receipt of such minutes). 
  
 3.3.4    Steering Committee Decisions.    Each vote of
the Steering Committee shall include all current members of the Steering Committee . Except as otherwise expressly provided for in this Agreement, all decisions of the Steering Committee shall be by [***] members of the Steering Committee after good
faith discussions. [***] Should, however, the Parties not be able to reach such [***] despite such good faith efforts, and should a [***] of the Steering Committee exist thirty (30) days after the date on which a disagreement arose, then, if the
subject matter of the decision is [***] under this Agreement, including but not limited to decisions as to whether to [***], such disagreement shall be elevated to the senior executives of the Parties for good faith discussion to try and reach
consensus between the Parties. In the event that the senior executives have not reached agreement (despite such good faith discussions) within sixty (60) days after the date on which the disagreement arose, then (i) if the subject of 

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 such disagreement is whether or not [***], then such [***] under this Agreement, and (ii) except as set forth in the
preceding subsection (i), unless otherwise mutually agreed by the Parties, all other disagreements of a material nature shall be submitted for resolution to the dispute resolution process pursuant to Section 13.5. 
  
 ARTICLE 4 
  
 SELECTION OF PROJECT GENES 
  
 4.1    Steering Committee
Review and Selection of Proposed Genes. 
  
 4.1.1    Submitted Genes.    Within [***] after the first Steering Committee meeting, HYSEQ shall submit in writing to DELTAGEN for its review and consideration an
initial written list(s) of [***] Submitted Genes and, within [***] after the Effective Date, shall submit in writing to DELTAGEN for its review and consideration a written list(s) of an additional [***] Submitted Genes for DELTAGEN to review under
this Section 4.1.1. HYSEQ shall use [**] efforts to submit additional Submitted Genes under this Agreement during such [***] period to replace Rejected Submitted Genes that DELTAGEN has rejected under this Section 4.1.1 until [***]
Project Genes have been selected. HYSEQ agrees to [***] when deciding which human gene sequences to include in the list of Submitted Genes to be submitted to DELTAGEN. Any submission of Submitted Genes subsequent to such [***] period shall be
subject to the approval of the Steering Committee. All Submitted Genes submitted by HYSEQ to the Steering Committee under this Section 4.1 shall be accompanied by at least a partial murine ortholog gene sequence believed by HYSEQ to
correspond to the gene sequence of such Submitted Gene (unless HYSEQ is unable to identify such an orthologous partial murine gene sequence for a Submitted Gene, in which case HYSEQ shall report such results to the Steering Committee) and DELTAGEN
shall notify HYSEQ as to whether or not, [***] as of the date of its submission by HYSEQ. If any of the Submitted Genes have [***], HYSEQ shall provide this information promptly to the Steering Committee with its information under Section
4.1.3 and HYSEQ hereby expressly acknowledges and agrees that if the Steering Committee designates such a Submitted Gene as a Proposed Gene or a Project Gene, as between DELTAGEN and HYSEQ that HYSEQ is [***], while such Proposed Gene or Project
Gene, as applicable, 
 

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 remains under this Agreement, and HYSEQ shall not [***] except as provided in Section 2.1.4(b) for a Rejected
Project Gene. 
  
 4.1.2    Proposed
Genes.    DELTAGEN shall notify HYSEQ within thirty (30) days after its receipt of the Submitted Gene and, if applicable, its accompanying murine ortholog sequence, whether DELTAGEN accepts or rejects such Submitted Gene,
such acceptance or rejection being within DELTAGEN’s sole discretion. 
  
 (a)    Any such accepted Submitted Gene for which notification has been provided shall be deemed a Proposed Gene. Within [***] after such written notification, HYSEQ will provide to DELTAGEN the supporting
information for such Proposed Gene in accordance with Section 4.1.3. 
  
 (b)    If DELTAGEN rejects a Submitted Gene such Submitted Gene shall be deemed a Rejected Submitted Gene. With respect to any such Rejected Submitted Gene, any of HYSEQ’s rights under HYSEQ’s Patents or
HYSEQ Know-How related solely to such Submitted Gene shall return to HYSEQ under this Agreement and shall not be subject to further restriction under this Agreement other than DELTAGEN’s obligations of confidentiality under Article 9 of this
Agreement. Each of the Parties shall perform no additional services under this Agreement with regard to such Rejected Submitted Gene. Each of the Party’s right, title and interest in and to such Rejected Submitted Gene shall remain with and
vest fully in that Party, and the other Party shall have no right, title, or interest therein or thereto. 
  
 4.1.3    Supporting Information and Disclosures.    Together with each written list of Submitted Genes, HYSEQ shall fully disclose to the Steering Committee in writing or
electronic form, with respect to each such Submitted Gene, the information actually known to HYSEQ regarding such Submitted Gene’s murine ortholog sequence and the results of HYSEQ’s Initial Murine Gene Analysis. With respect to each
Proposed Gene, HYSEQ shall disclose to the Steering Committee in writing or in electronic form the following information actually known to HYSEQ: (i) any and all Technical Information and Patents (including but not limited to HYSEQ Patents and HYSEQ
Know-How) covering such Proposed Gene that are owned or controlled by HYSEQ, (ii) any restrictions on the use of such Proposed Gene, (iii) [***], (iv) any and all facts and information which are limiting or preventing, or that could or would limit
or prevent, 
 

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 HYSEQ’s right or ability to grant the license to DELTAGEN pursuant to Section 2.1, or are causing, [***], and
(iv) [***] under this Agreement, including the following: 
  
 (a)    any
pre-existing or other rights, interests and/or options in or to, or any other encumbrances (including any liens) on, such Proposed Gene and/or any HYSEQ Patents or HYSEQ Know-How covering or relating to such Proposed Gene; 
  
 (b)    any licenses or other agreements with any Person relating to such Proposed Gene (including any
in-licensed technology relating to such Proposed Gene), or relating to the HYSEQ Patents or HYSEQ Know-How covering or relating to such Proposed Gene; and 
  
 (c)    any [***] of such Proposed Gene and/or any HYSEQ Patents or HYSEQ Know-How covering or relating to such Proposed Gene.

  
 HYSEQ shall also provide further information, as may reasonably be requested by the Steering Committee, and if requested, shall make
available to the Steering Committee the appropriate technical and other HYSEQ employees to answer questions posed by the Steering Committee with respect to the Proposed Genes and the information and disclosures submitted under this Section
4.1.3. With respect to a Proposed Gene, if HYSEQ makes a [***] in writing pursuant to this Section 4.1.3 of [***], prior to or concurrently with its submission to the Steering Committee of such Proposed Gene, HYSEQ [***];
providedthat DELTAGEN shall have the right to refuse to conduct any activities with respect to such Proposed Gene, if DELTAGEN, in its sole discretion, so chooses, under this Section 4.1.3 or Section 4.1.1 above, either due to
HYSEQ’s inability to provide information, or as a result of the information provided by HYSEQ or information DELTAGEN acquires independently of HYSEQ. If DELTAGEN chooses to not conduct any activities with respect to such Proposed Gene under
this Section 4.1.3, such Proposed Gene shall become a Rejected Proposed Gene in accordance with the terms and conditions of Section 4.3 of this Agreement. DELTAGEN may also choose not to continue with a Proposed Gene under this
Agreement if technical obstacles make it commercially reasonable not to proceed. In such event, DELTAGEN shall notify the Steering Committee, and the Steering Committee may vote affirmatively to continue with such Proposed Gene as a Project Gene
with a [***] sharing between the Parties of all costs arising from such technical obstacles. 
 

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 4.2    Selection of Project
Genes.    After reviewing a Proposed Gene and the information and disclosures received from HYSEQ pursuant to Sections 4.1.1 and 4.1.3, and the information and reports received from DELTAGEN, and if applicable,
HYSEQ, pursuant to Sections 4.1.3 with respect to such Proposed Gene, the Steering Committee members shall vote on whether to include such Proposed Gene as a “project gene” hereunder. If the Steering Committee members vote
affirmatively to include a Proposed Gene as a “project gene” under this Agreement, then upon such vote, such Proposed Gene shall become a Project Gene. 
  
 4.3    Rejected Proposed Genes.    Unless otherwise decided by the Parties or the Steering Committee, any Proposed Gene which (i) DELTAGEN
has notified HYSEQ it shall not work on under this Agreement (ii) the Steering Committee members have voted to reject as a “project gene,” and/or (iii) the Steering Committee members have not voted affirmatively to include as a
“project gene” under this Agreement within ninety (90) days after submission of information regarding the Proposed Gene to the Steering Committee pursuant to Section 4.1.3, shall be a “Rejected Proposed Gene.” Each
of the Parties shall perform no additional services under this Agreement with regard to such Rejected Proposed Gene. Each of the Party’s right, title and interest in and to such Rejected Proposed Gene (if any) shall remain with and vest fully
in that Party, and the other Party shall have no right, title, or interest therein or thereto. 
  
 ARTICLE 5

  
 HYSEQ FUNDING AND DEVELOPMENT PROGRAM ACTIVITIES 
  
 5.1    HYSEQ Development Funding.    As partial consideration for the research and development activities to be
conducted by DELTAGEN under this Agreement, HYSEQ shall pay DELTAGEN as follows: 
  
 (a)    within [***] after the Effective Date, HYSEQ shall pay to DELTAGEN [***] U.S. Dollars (U.S.$[***]) (“Payment One”); 
  
 (b)    within [***] of the Effective Date, HYSEQ shall pay to DELTAGEN [***] U.S. Dollars (U.S.$[***]) (“Payment Two”)
if the Steering Committee has designated [***] two hundred (200) Project Genes within [***] after the Effective Date; provided, however, if the Steering Committee has designated [***] as provided for under this Agreement, but the 

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 Steering Committee has designated [***] designated during such period, plus [***] as represented by the following
formula: 
  
 [***]; 
  
 (c)    within [***] of the Effective Date, HYSEQ shall pay to DELTAGEN [***] U.S. Dollars (U.S.$[***]) (“Payment
Three”) if DELTAGEN has created two hundred (200) ES cell lines for Project Genes; provided, however, that if DELTAGEN has [***], as represented by the following formula: 
  
 [***]; and 
  
 (d)    within twenty-four (24) months after the Effective Date, HYSEQ shall pay to DELTAGEN the remaining amount of a pro-rated Ten Million U.S. Dollars (U.S.$10,000,000) (“Total Payment”)
calculated by the following formula: 
  
 [***]. 
  

HYSEQ acknowledges and agrees that the payments payable to DELTAGEN pursuant to this Section are non-refundable, and may be used and disposed of as DELTAGEN, in its reasonable business
judgment, determines is appropriate in accordance with the terms and conditions of this Agreement. 
  
 5.2    Initiation of Projects; and Performance and Delays.    The Steering Committee shall determine which Projects to submit to DELTAGEN to initiate work on such Projects
under the Development Program. Each Party shall use reasonable commercial efforts to fulfill their obligations with respect to each Project as set forth herein (including the Work Plan), and to perform its other obligations under this Agreement;
provided that, with respect to DELTAGEN’s activities under the Development Program, HYSEQ acknowledges and agrees that the performance of such activities may involve a number of technologically complex steps and that any time
periods for performance, whether set out in the Work Plan or elsewhere in this Agreement, may be subject to change due to potential technological difficulties encountered, and any such delays or technical issues shall not be considered a breach by
DELTAGEN under this Agreement. If a Project is delayed because either Party determines that there are any technical issues with respect to a Project of a material nature, it shall notify the Steering Committee in 
 

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 writing describing the delayed task and the reasons for such delay. After receiving such notice, if necessary, the Steering Committee shall meet
to review the reason for such delays and any technical issues raised by the notifying Party, to consider how best to proceed and whether to modify the Work Plan (including to adjust any timelines contained therein), if and to the extent necessary.
If requested by the Steering Committee, the Parties shall provide information to the Steering Committee to assist it in its review of the Project. The Steering Committee may vote at any time to discontinue or suspend a Project if the Steering
Committee determines that it is commercially reasonable or necessary to do so. DELTAGEN may determine, in its reasonable business judgment, to [***] Project [***]; provided, however, that DELTAGEN shall notify HYSEQ in writing within three (3)
business days of such determination and shall [***] Project [***]. Upon such decision by the Steering Committee or DELTAGEN, as applicable, to [***] Project, the applicable Project Gene shall immediately become a Rejected Project Gene. 

 
 5.3    Generation and Testing of Project Knock-Out Mice; and First Pass Phenotypic Analysis;
and Updates and Reports. 
  
 5.3.1    Certain DELTAGEN
Activities.    For each Project initiated by the Steering Committee pursuant to Section 5.2, DELTAGEN shall, as set out in the Work Plan, use [***] efforts to: (i) [***] to create and generate a corresponding
Project Knock-Out Mouse, (ii) generate Project Knock-Out Mice [***] Project Knock-Out Mouse [***] using the Project Murine Gene that is orthologous to the Project Gene which is the subject of the Project; and (iii) conduct a First Pass Phenotypic
Analysis of such Project Knock-Out Mice. Exhibit A may be reasonably modified in writing from time to time [***] to add tests, observations and/or analyses to be performed by DELTAGEN at any time under this Agreement and DELTAGEN shall notify
HYSEQ of such changes as part of its report regarding First Pass Phenotypic Analysis. 
  
 5.3.2    Updates.    Within ten (10) days after the end of each calendar quarter, DELTAGEN shall provide all Steering Committee members with a written report describing the
status, and expected completion date, of its work on each Project under the Work Plan and with data from any portion(s) of the First Pass Phenotypic Analysis completed on a Project during the just-ended Calendar Quarter, if any, and if it has not
already provided such information to the Steering Committee. If and as reasonably requested by the Steering Committee, DELTAGEN
 
 

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shall make persons working on its behalf on a Project available during normal business hours for a reasonable number of consultations with the Steering Committee regarding such Project. Such
consultations will either be in-person at such person’s place of employment or via videoconference or teleconference. 
  
 5.3.3    First Pass Phenotypic Analysis Report.    Once DELTAGEN completes the First Pass Phenotypic Analysis on a Project under the Work Plan, it shall (to the
extent not already provided pursuant to Section 5.3.2) submit to the Steering Committee for the Steering Committee’s review a final report of the results of such Project. 
  
 5.4    Additional Testing; Costs. 
  
 5.4.1    Additional Testing.    If, at any time during this Agreement, HYSEQ or DELTAGEN
believes an additional test, observation, or analysis not included in the First Pass Phenotypic Analysis, or covered by the Work Plan would be useful to a Project, the Party may submit its proposal to the Steering Committee for the Steering
Committee’s approval. If the Steering Committee approves any such additional tests, observations, or analysis requested by either Party, or if the Steering Committee determines that it is necessary to assist it with determining whether to
designate as a “secreted protein candidate,” a Secreted Protein produced by the Project Gene that is the subject of such Project, the Steering Committee may request that DELTAGEN or HYSEQ perform additional assays, including phenotypic
tests, observations, or analyses not included in the First Pass Phenotypic Analysis on such Project (collectively, “Additional Tests”). DELTAGEN or HYSEQ, as applicable, shall perform the Additional Tests, as requested by the
Steering Committee pursuant to this Section; provided that the Parties shall share the costs as set forth in Section 5.4.2. Once DELTAGEN or HYSEQ, as applicable, has completed such Additional Tests on a Project, DELTAGEN or
HYSEQ, as applicable, shall submit to the Steering Committee for the Steering Committee’s review of the Project under Section 5.5 a report of the results of such additional services. 
  

5.4.2    Sharing of Costs.    HYSEQ or DELTAGEN, as applicable, shall reimburse the Party
performing the Additional Tests for [***] of the reasonable costs (including FTEs) and reasonable out-of-pocket expenses incurred in performing the Additional Tests, within thirty (30) days of HYSEQ’s or DELTAGEN’s, as applicable, receipt
of an invoice from 
 

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 the Party performing the Additional Tests, including reasonable supporting
documentation, covering such costs and out-of-pocket expenses incurred in connection with conducting such activities under this Agreement. In the event there is a good faith dispute over an amount owed by a Party under this Section 5.4.2, the
disputed portion of the payment may be delayed, and such payment shall not be considered delinquent pending a resolution of the Parties’ dispute. 
  
 5.5    Designation of Secreted Protein Candidates; Designation Guidelines. 
  
 5.5.1    Designation of Secreted Protein Candidates.    After reviewing the information
provided to it pursuant to Sections 3.2.4, 5.3 and 5.4, with respect to a Project, the Steering Committee members shall vote whether to designate the Secreted Protein produced by the Project Gene which is the subject of such Project, together
with its Derivative Proteins, as a “secreted protein candidate.” If the Steering Committee members vote affirmatively, within [***] after receiving such information provided to it regarding a Secreted Protein, a Secreted Protein shall be a
Secreted Protein Candidate hereunder. If less than [***] of the Steering Committee members vote affirmatively to designate a Secreted Protein as a Secreted Protein Candidate or if the Steering Committee fails to vote affirmatively within such [***]
period to designate a Secreted Protein as a Secreted Protein Candidate, then the Project Gene that produced such Secreted Protein shall immediately become a Rejected Project Gene. 
  
 5.5.2    Designation Guidelines.    A Steering Committee member’s standard for voting to
designate a Project Gene’s Secreted Protein as a “secreted protein candidate” shall be a good faith belief that, based on the First Pass Phenotypic Analysis (and any additional testing, observation, and analysis requested by the
Steering Committee pursuant to Section 5.4), the Project Knock-Out Mice that is the subject of such Project (whether at the heterozygous or homozygous gene knock-out stage) manifest, either [***], a morphological, physiological, or
pathophysiological phenotypic change that [***] Secreted Protein. Examples of a morphological, physiological, or pathophysiological phenotypic change that [***] Secreted Protein [***]. 
  
 5.5.3    Rejected Project Gene.    Unless otherwise decided by the Parties or the Steering
Committee, any Project Gene which (i) the Steering Committee members have voted to [***],” (ii) the Steering Committee members have not voted [***] under this Agreement within 
 

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 [***] of its submission to the Steering Committee pursuant to Section 5.5.1, and/or (iii) has been [***] Steering
Committee, [***] “Rejected Project Gene.” Neither Party shall [***] Affiliates or Third Parties any of the Project Intellectual Property [***] Project Gene [***] Rejected Project Gene [***] Restriction Term. 
  
 5.5.3.1    During Restriction Term.    If, during the
Restriction Term, either Party obtains [***] on a Rejected Project Gene, such Party may present such Rejected Project Gene to the Steering Committee for another vote on whether to designate such Rejected Project Gene as a Secreted Protein Candidate.
At the time of presentation of a Rejected Project Gene to the Steering Committee, each of the Parties must disclose to the other Party the [***] Rejected Project Gene,[***] performed during the Restriction Term. 
  
 5.5.3.2    Expiration of Restriction Term.    Upon expiration
of the Restriction Term for any Rejected Project Gene, each Party must disclose to the other Party the [***] Rejected Project Gene [***] Restriction Term, and the Steering Committee shall determine if such Rejected Project Gene shall be further
analyzed and studied under the Development Program. 
  
 5.5.3.3    Steering Committee Vote on Rejected Project Gene.    If the Steering Committee votes to return a Rejected Project Gene to the Development Program, the license
grants under Sections 2.1.3 and 2.3.1 shall again become effective in accordance with their terms. If the Steering Committee cannot reach an agreement on a Rejected Project Gene presented to it under this Section 5.5.3, the Chief
Executive Officers of the Parties shall make such determination. If the Chief Executive Officers cannot reach an agreement on such Rejected Project Gene, then such determination shall not be subject to the dispute resolution procedure set forth in
Section 13.5, but rather: (a) if DELTAGEN votes not to return such Rejected Project Gene to the Development Program and HYSEQ votes to return such Rejected Project Gene to the Development Program, then DELTAGEN hereby grants to HYSEQ a
worldwide, royalty-free, perpetual, non-exclusive license under DELTAGEN Project Intellectual Property and DELTAGEN Knock-Out Technology relating to such Rejected Project Gene to use Project Knockout Mice and to make, have made, use, sell,
distribute, import, and market products that contains as an active ingredient a Rejected Project Gene, a protein encoded by such Rejected 
 

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 Project Gene (or portion thereof), or an agonist or antagonist (including, without limitation, anti-sense, antibodies and
small molecules) of a protein encoded by such Rejected Project Gene; or (b) if HYSEQ votes not to return such Rejected Project Gene to the Development Program and DELTAGEN votes to return such Rejected Project Gene to the Development Program, then
HYSEQ hereby grants to DELTAGEN a worldwide, royalty-free, perpetual, non-exclusive license under HYSEQ Know-How, HYSEQ Patents and HYSEQ Project Intellectual Property relating to such Rejected Project Gene to use Project Knockout Mice and to make,
have made, use, sell, distribute, import, and market products that contains as an active ingredient a Rejected Project Gene, a protein encoded by such Rejected Project Gene (or portion thereof), or an agonist or antagonist (including, without
limitation, anti-sense, antibodies and small molecules) of a protein encoded by such Rejected Project Gene. If the Party that obtains a non-exclusive license pursuant to this Section 5.5.3.3 wishes to obtain an exclusive license to such
Rejected Project gene, the Parties shall negotiate in good faith concerning reasonable commercial terms for such an exclusive license, including, without limitation, commercially reasonable royalty rates and milestone payments. 

 
 5.5.3.4    Maintenance of Project Knock-Out
Mice.    If HYSEQ desires to maintain the line of a Rejected Project Gene’s Project Knock-Out Mouse beyond the Resriction Term, it shall so notify DELTAGEN in writing prior to the expiration of the Restriction Term.
The Parties shall use good faith efforts to agree upon an appropriate manner to preserve the Project Knock-Out Mouse, its ES cells or frozen sperm sufficient to regenerate such Project Knock-Out Mouse, at HYSEQ’s sole cost and expense.

  
 5.5.3.5    Right of First
Refusal.    If, during the Restriction Term, a Third Party approaches a Party (“Approached Party”) and presents a [***], such Approached Party shall [***] 
  
 ARTICLE 6 
  
 COMMERCIALIZATION AND OTHER ACTIVITIES 
  
 6.1    Further
Research and Development of a Secreted Protein Candidate. 
  
 6.1.1    Further Development Activities.    Once a Secreted Protein Candidate has been designated by the Steering Committee pursuant to Section 5.5, the Steering
Committee 
 

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 shall either modify the Work Plan, or create a separate work plan, if and as may be appropriate, to outline the scope of
development activities and the responsibilities of the Parties with respect thereto and the Parties shall enter into a separate agreement with respect to development and commercialization of such Secreted Protein Candidate Product derived therefrom.
Unless otherwise decided by the Parties, the Parties shall [***] share all costs (including FTEs) and out-of-pocket expenses associated with conducting such research and development activities on a [***] basis, in accordance with the procedures set
forth in Section 6.1.2. 
  
 6.1.2    Accounting of Shared
Cost; and Reports.    All costs and out-of-pocket expenses that are to be shared by the Parties on a [***] basis pursuant to Section 3.1.2, (“Shared Costs”) shall be reviewed by the Parties each
calendar quarter to determine the amount of Shared Costs incurred by each Party for such calendar quarter hereunder. Within sixty (60) days of the end of each calendar quarter (or as otherwise mutually agreed by the Parties), each Party shall
provide to the other Party and the Steering Committee a report detailing the total Shared Costs incurred by it, with respect to Section 6.1.1 on a Secreted Protein Candidate-by-Secreted Protein Candidate basis and for Products incorporating
such Secreted Protein Candidate whose apportionment of costs are not otherwise the subject of a separate agreement between the Parties (or, if applicable, between a Party and its Affiliate and/or a Third Party), on a Product-by-Product basis,
and: 
  
 (a)    if DELTAGEN incurred more than [***] of the total Shared
Costs for a calendar quarter, then DELTAGEN shall invoice HYSEQ for the amount representing the difference between the percentage paid by DELTAGEN and the [***] (the “HYSEQ Deficiency”) and HYSEQ shall pay DELTAGEN the HYSEQ
Deficiency within thirty (30) days of its receipt of such invoice; or 
  
 (b)    if HYSEQ incurred more than [***] of the total Shared Costs for a calendar quarter, then DELTAGEN shall pay HYSEQ the amount representing the difference between the percentage paid by HYSEQ and the
[***] (the “DELTAGEN Deficiency”) within thirty (30) days of notifying HYSEQ of the total Shared Costs incurred by the Parties. 
  
 In the event there is a good faith dispute over an amount owed by HYSEQ under this Section 6.1.2, the disputed portion of the payment may be delayed, and such payment shall not be
 
 

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considered delinquent pending a resolution of the Parties’ dispute, other than with respect to the terms and conditions of Section 13.7. 
  
 6.2    Commercialization of Secreted Protein Candidates and Products.    If
the Steering Committee decides not to conduct further development activities with respect to a Secreted Protein Candidate or any Products identified by either Party under the Development Program that utilize such Secreted Protein Candidate, the
Parties shall, through the Steering Committee, hold good faith discussions to determine how, and whether, to proceed with further development and/or commercialization of any such Secreted Protein Candidate (and/or any identified Products that
utilize such Secreted Protein Candidate), either themselves or through or with any Affiliate and/or Third Parties. Any such development and/or commercialization activities shall be conducted pursuant to the terms and conditions of a separate
agreement to be negotiated between the Parties and any other relevant parties to such agreement(s). If the Parties decide not to proceed under this Section 6.2, and if neither of the Parties invokes the provisions of Section 6.3 below,
then upon the expiration of the [***] period provided for in Section 6.3.1 the applicable Project Gene shall become a Rejected Project Gene under this Agreement. 
  
 6.3    Deadlock. 
  
 6.3.1    Submission of Term Sheet to Steering Committee.    If the Steering Committee is unable to agree on how to proceed with respect to a
Secreted Protein Candidate (or any Products identified by either Party under the Development Program that utilize such Secreted Protein Candidate) pursuant to Section 6.2 within [***] of first considering such Secreted Protein Candidate (or
its corresponding Product(s)), then within [***] of such date, each Party may, if it so chooses, present to the Steering Committee a proposed term sheet ( a “Proposed Term Sheet”) that sets out terms and conditions under which such
Party wishes to develop and commercialize such Secreted Protein Candidate (and/or any Products identified by either Party under the Development Program that utilize such Secreted Protein Candidate) which the submitting Party would like to pursue
itself or with or through an Affiliate and/or Third Party. Any such Proposed Term Sheet submitted to the Steering Committee by a Party shall include commercially reasonable terms and conditions and shall provide for sufficient consideration to the
other Party (the “non-Participating Party”) for its contributions under this 
 

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 Agreement and for any licenses to any Project Intellectual Property and/or Project Patents that such Party may request
from the non-Participating Party, including commercially reasonable royalties, development and marketing milestones and sublicensing revenue shares and objective performance obligations. The Steering Committee shall review and consider any Proposed
Term Sheet submitted by a Party and shall use good faith efforts to approve one of the Party’s Proposed Term Sheet (but shall have no obligation to do so). If the Steering Committee votes and approves a Party’s Proposed Term Sheet, such
Party is authorized to negotiate an agreement based upon such Proposed Term Sheet, the Party may proceed with such negotiations, but shall provide the Steering Committee with a copy of the Agreement prior to signing for final review and approval
(such approval not to be unreasonably withheld or delayed). Subject to any confidentiality obligations to which a Party may be bound, such Party shall keep the Steering Committee updated with respect to such negotiations, if and as reasonably
requested by the Steering Committee. If at any time during the Term, each Party agrees to submit a Proposed Term Sheet to the Steering Committee under this Section 6.3.1, and the Steering Committee rejects both, or does not approve either,
Party’s Proposed Term Sheets, then either Party may initiate the mediation procedure under Section 6.3.2 upon written notice to the other Party. If only one Party submits a Proposed Term Sheet to the Steering Committee, and the Steering
Committee rejects such Party’s Proposed Term Sheet, or neither Party submits a Proposed Term Sheet, then neither Party may initiate the mediation procedure under Section 6.3.2 or proceed or conduct any development or commercialization
activities with respect to such Secreted Protein Candidate (or any Products that utilize such Secreted Protein Candidate) except as authorized by the Steering Committee or as mutually agreed by the Parties in writing; providedthat if
the Parties both agree at a later date to submit Proposed Term Sheets to the Steering Committee covering the development and/or commercialization of such Secreted Protein Candidate (or any Products that utilize such Secreted Protein Candidate) under
this Section, then the Parties can at that time initiate the mediation procedure under Section 6.3.2 on written notice to the other Party if the Steering Committee rejects both, or does not approve either, Party’s Proposed Term Sheets.

  
 6.3.2    Third Party
Mediation.    Upon a Party’s receipt of a notice from the other Party initiating the mediation procedures under this Section, the Parties shall meet to attempt in 
 

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 good faith to resolve this matter through face-to-face negotiations between senior executives of HYSEQ and DELTAGEN,
including consideration of any Proposed Term Sheets. If the matter is not resolved within thirty (30) days (or such other period of time mutually agreed upon by the Parties) of commencing such face-to-face negotiations, or if the Party against which
a claim has been asserted refuses to attend such negotiations or does not otherwise participate in such negotiations within thirty (30) days (or such other period of time mutually agreed upon by the Parties) from the date of notice of to the other
Party under this Section 6.3.2, then either Party may initiate the procedures set forth on Exhibit B upon notice to the other Party.  
  
 ARTICLE 7 
  
 REPRESENTATIONS AND WARRANTIES 

 
 7.1    HYSEQ Representations and Warranties.    As of the
Effective date and during the Term (unless expressly stated in this Section 7.1), HYSEQ hereby represents and warrants the following to DELTAGEN: 
  
 7.1.1    HYSEQ is (i) a company duly organized, validly existing, and in good standing under the laws of Nevada with its
respective principal place of business as indicated in the first paragraph of this Agreement; (ii) duly qualified as a corporation and in good standing under the laws of each jurisdiction where its ownership or lease of property or the conduct of
its business requires such qualification, where the failure to be so qualified would have a material adverse effect on its financial condition or its ability to perform its obligations hereunder; (iii) has the requisite corporate power and authority
and the legal right to conduct its business as now conducted and hereafter contemplated to be conducted; (iv) has all necessary licenses, permits, consents, or approvals from or by, and has made all necessary notices to, all governmental authorities
having jurisdiction, to the extent required for such ownership and operation; and (v) is in compliance with its certificate of incorporation and by-laws. 
  
 7.1.2    The execution, delivery and performance of this Agreement by HYSEQ and all documents to be delivered by HYSEQ hereunder:
(i) are within the corporate power of HYSEQ; (ii) have been duly authorized by all necessary or proper corporate action; (iii) are not in contravention of any provision of the certificate of incorporation or by-laws of HYSEQ; (iv) will not violate
any law or regulation or any order or decree of any court of governmental 
 

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 instrumentality; (v) will not violate the terms of any indenture, mortgage, deed of trust, lease, agreement, or other
instrument to which HYSEQ is a party or by which HYSEQ or any of its property is bound; and (vi) do not require any filing or registration with or the consent or approval of, any governmental body, agency, authority or any other Person, which has
not been made or obtained previously. 
  
 7.1.3    This Agreement has been
duly executed and delivered by HYSEQ and constitutes a legal, valid and binding obligation of both HYSEQ, enforceable against both and either of HYSEQ in accordance with its terms. 
  
 7.1.4    Except as expressly provided on Exhibit D, (which may be modified in accordance with the terms and conditions of
this Agreement for a particular Submitted Gene up until the time that information is submitted for a Proposed Gene under Section 4.1.3), HYSEQ is the sole and exclusive owner of the entire right, title and interest in and to the HYSEQ Patents
and the HYSEQ Know-How, free and clear of any liens or other encumbrances, and no other Person (including any government or university) has any license, claim or other right or interest in or to any HYSEQ Patents or the HYSEQ Know-How. The HYSEQ
Patents and the HYSEQ Know-How may be co-exclusively licensed to DELTAGEN hereunder, and as contemplated under Article 6 under a separate agreement to commercialize Secreted Protein Candidate and/or Products, without payment of any royalty,
fee or incurring any other obligation to any other Person (including any government or university). 
  
 7.1.5    HYSEQ has disclosed or made available to DELTAGEN, to the extent of HYSEQ’s actual knowledge, all information relevant to [***]. 
  
 7.1.6    HYSEQ has disclosed or made available to DELTAGEN, to the extent of HYSEQ’s actual knowledge, [***]. 

 
 7.1.7    HYSEQ has disclosed or made available to DELTAGEN, to the extent of
HYSEQ’s actual knowledge, all information regarding whether [***] covered by any HYSEQ Patents or which utilizes any HYSEQ Know-How or any Proposed Gene (subject to any disclosures made by HYSEQ in writing pursuant to Section 4.1.3 with
respect to any such Proposed Gene), Project Gene, Secreted Protein or Derivative [***]. 
 

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 7.1.8    HYSEQ is not aware of any
infringement of the HYSEQ Patents, or any misappropriation of the HYSEQ Know-How by any Third Party. 
  
 7.1.9    Except as provided in the information under Section 4.1.3 submitted for a Proposed Gene pursuant to this Agreement, all of the research and development work performed in connection with any of the
HYSEQ Know-How or any Submitted Gene, Proposed Genes (subject to any disclosures made by HYSEQ in writing pursuant to Section 4.1.3 with respect to any such Proposed Gene), or Project Genes prior to the Effective Date was [***] and was
performed in accordance with applicable law and in compliance with all applicable regulatory requirements, and all such rights have been properly assigned to HYSEQ including any and all rights of any consultants of HYSEQ. 
  
 7.1.10    HYSEQ follows reasonable commercial practices common in the industry to protect its
proprietary and confidential information, including requiring its consultants and agents to be bound in writing by obligations of confidentiality and non-disclosure, and requiring its employees to assign to it any and all inventions and discoveries
discovered by such employees made within the scope of, and during their employment, and only disclosing proprietary and confidential information to Third Parties pursuant to written confidentiality and non-disclosure agreements. 

 
 7.1.11    HYSEQ has not, up through and including the Effective Date, [***]
concerning the activities contemplated by this Agreement which would be [***] with such information [***] during the Term of this Agreement. 
  
 7.2    DELTAGEN Representations and Warranties.    As of the Effective date and during the Term(unless expressly stated in this Section
7.2), DELTAGEN hereby represents and warrants the following to HYSEQ: 
  
 7.2.1    DELTAGEN is (i) a company duly organized, validly existing, and in good standing under the laws of Delaware with its respective principal place of business as indicated in the first paragraph of
this Agreement; (ii) duly qualified as a corporation and in good standing under the laws of each jurisdiction where its ownership or lease of property or the conduct of its business requires such qualification, where the failure to be so qualified
would have a material adverse effect on its financial condition or its ability to perform its obligations 
 

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 hereunder; (iii) has the requisite corporate power and authority and the legal right to conduct its business as now
conducted and hereafter contemplated to be conducted; (iv) has all necessary licenses, permits, consents, or approvals from or by, and has made all necessary notices to, all governmental authorities having jurisdiction, to the extent required for
such ownership and operation; and (v) is in compliance with its certificate of incorporation and by-laws. 
  
 7.2.2    The execution, delivery and performance of this Agreement by DELTAGEN and all documents to be delivered by DELTAGEN hereunder: (i) are within the corporate power of DELTAGEN; (ii) have been duly
authorized by all necessary or proper corporate action; (iii) are not in contravention of any provision of the certificate of incorporation or by-laws of DELTAGEN; (iv) will not violate any law or regulation or any order or decree of any court of
governmental instrumentality; (v) will not violate the terms of any indenture, mortgage, deed of trust, lease, agreement, or other instrument to which DELTAGEN is a party or by which DELTAGEN or any of its property is bound; and (vi) do not require
any filing or registration with or the consent or approval of, any governmental body, agency, authority or any other Person, which has not been made or obtained previously. 
  
 7.2.3    This Agreement has been duly executed and delivered by DELTAGEN and constitutes a legal, valid and binding obligation of
both DELTAGEN, enforceable against both and either of DELTAGEN in accordance with its terms. 
  
 7.2.4    DELTAGEN [***] to protect its proprietary and confidential information, including requiring its consultants and agents to be bound in writing by obligations of confidentiality and non-disclosure,
and requiring its employees to assign to it any and all inventions and discoveries discovered by such employees made within the scope of, and during their employment, and only disclosing proprietary and confidential information to Third Parties
pursuant to written confidentiality and non-disclosure agreements. 
  
 7.2.5    DELTAGEN has not, up through and including the Effective Date, [***], concerning the activities contemplated by this Agreement which would be [***] with such information [***] during the Term of
this Agreement. 
 

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 ARTICLE 8 
  
 INDEMNIFICATION 
  
 8.1    Indemnification.    Each Party agrees to indemnify and hold forever harmless the other Party and its Affiliates and each of their agents, directors, officers,
employees, consultants, contractors and (sub)licensees from and against any loss, damage, action, proceeding, cost, expense or liability (including reasonable attorneys’ fees) (collectively, “Loss”) arising from or in
connection with any Third Party claim or action relating to or arising from (a) the breach of any representation, warranty or covenant of the indemnifying Party under this Agreement; or (b) the [***] of the indemnifying Party or any its Affiliates
or any of its or its Affiliates’ agents, directors, officers, employees, consultants, contractors and/or (sub)licensees. 
  
 8.2    Procedure.    The indemnities set forth in this Article 8 are subject to the condition that the Party seeking indemnity shall (a) promptly notify the
indemnified Party under Section 8.1 (the “Indemnifying Party”) on being notified or otherwise made aware of a suit, action or claim; (b) tender to the Indemnifying Party control of any proceedings regarding such matter [***];
provided that the Indemnifying Party may not settle the suit or otherwise consent to any judgment in such suit without the written consent of the Indemnified Party [***]. The Indemnifying Party has no obligation hereunder in connection
with any settlement made without the Indemnifying Party’s written consent (provided that such consent was not unreasonably withheld). The non-Indemnifying Party shall cooperate with the Indemnifying Party in the defense of any Third Party
claim, as reasonably requested by the Indemnifying Party. 
  
 8.3    LIMITATIONS ON
LIABILITY.    EXCEPT AS OTHERWISE EXPRESSLY PROVIDED IN SECTION 8.1 WITH RESPECT TO THIRD PARTY CLAIMS, NEITHER PARTY SHALL BE LIABLE TO THE OTHER FOR ANY INDIRECT, SPECIAL, CONSEQUENTIAL OR INCIDENTAL DAMAGES,
INCLUDING ANY LOSS OF PROFITS OR LOSS OF ANY BUSINESS OPPORTUNITY. 
  
 8.4    DISCLAIMERS. 
  
 8.4.1    EXCEPT FOR THE WARRANTIES SET FORTH IN ARTICLE 7, NEITHER PARTY MAKES ANY WARRANTIES HEREUNDER AND EXPRESSLY DISCLAIMS ALL WARRANTIES, EXPRESS OR IMPLIED, INCLUDING ANY 
 

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 WARRANTIES OF MERCHANTABILITY, NON-INFRINGEMENT AND FITNESS FOR A PARTICULAR PURPOSE. 
  
 8.4.2    WITHOUT LIMITING SECTION 8.4.1, HYSEQ HEREBY ACKNOWLEDGES AND AGREES THAT THE
PROJECT KNOCK-OUT MICE AND ANY DERIVATIVES OR PROGENY THEREOF ARE PROVIDED “AS IS,” WITHOUT ANY WARRANTY, EXPRESS OR IMPLIED, INCLUDING ANY WARRANTIES OF MERCHANTABILITY AND FITNESS FOR A PARTICULAR PURPOSE. FURTHERMORE, DELTAGEN MAKES NO
REPRESENTATION OR WARRANTY THAT THE USE OF THE PROJECT KNOCK-OUT MICE AND ANY DERIVATIVES OR PROGENY THEREOF WILL NOT INFRINGE, MISAPPROPRIATE OR OTHERWISE CONFLICT WITH ANY PATENT OR OTHER PROPRIETARY RIGHTS OF ANY OTHER PERSON. 

 
 ARTICLE 9 
  
 CONFIDENTIALITY, PRESS RELEASES AND OTHER DISCLOSURES 
  
 9.1    Nondisclosure. 
  
 9.1.1    During the Term and for [***] thereafter without regard to the means of termination, neither DELTAGEN nor HYSEQ shall use for any purpose other than the purpose of this Agreement or reveal or
disclose to any Third Party information and materials disclosed by, or obtained from, the other Party (whether prior to or during the Term), and which is marked as “Confidential” or for information or materials disclosed or obtained orally
or otherwise in a non-written form, which is described or summarized in a writing identified as “Confidential” and forwarded to the other Party within thirty (30) days of such disclosure (“Confidential Information”)
without first obtaining the written consent of the other Party, except (i) as required by law or court order (subject to prior notification to the other Party and seeking redaction and confidential treatment where available); (ii) as required in
connection with any filings made with, or by the disclosure policies of a stock exchange (subject to prior notification to the other Party and seeking redaction and confidential treatment where available); and (iii) as expressly permitted under this
Agreement, including as permitted under Section 10.3.5. 
 

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 9.1.2    The obligations of
confidentiality set forth in this Section 9.1 shall not apply to such information which (a) is or becomes a matter of public knowledge, through no fault of the receiving Party; (b) is already rightfully in the possession of the receiving
Party without an obligation of confidentiality at the time of disclosure, as reasonably evidenced by the receiving Party; (c) is disclosed non-confidentially to the receiving Party by a Third Party having lawful possession of such information and
the right to do so; or (d) is subsequently and independently developed by employees of the receiving Party or Affiliates thereof without reference to or knowledge of the Confidential Information disclosed, as reasonably evidenced by the receiving
Party. The Parties shall take reasonable measures to assure that no unauthorized use or disclosure is made by others to whom access to such information is granted. 
  
 9.1.3    HYSEQ and DELTAGEN each agree to limit the disclosure of any Confidential Information of the other Party received or
obtained hereunder to such of its Affiliates and its and its Affiliates’ employees, consultants, sublicensees permitted under Article 2 and agents, as are necessary to carry out the provisions of this Agreement and who are likewise bound
by written obligations of confidentiality which are comparable to, or more stringent than, the provisions of this Article 9. Each Party agrees to provide the other Party with written notice of any such consultants, sublicensees, or agents.

  
 9.2    Press Releases and Public
Announcements.    Neither Party shall otherwise issue any press releases or other publicity materials, or make any public announcements relating to the terms or conditions of this Agreement or relating to the Development
Program or any Confidential Information of the other Party without the prior written consent of the other Party. This restriction shall not apply to disclosures required by law or regulation, including as may be required in connection with any
filings made with, or by the disclosure policies of a stock exchange (subject to prior notification to the other Party and seeking redaction and confidential treatment where available). 
  
 9.3    Publications and Presentations.    Without limiting Section 9.2, neither Party shall make any
publications or presentations relating to any Proposed Genes (unless and until it is a Rejected Proposed Gene), Project Genes, Project Knockout Mice, Project Murine Genes, Secreted Proteins, Derivative Proteins, Secreted Protein Candidates or
Products or otherwise 
 

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 relating to the Development Program or any activities thereunder, including any of the results or data arising from the activities conducted
under Development Program or containing, disclosing or relating to any Confidential Information of the other Party, without the other Party’s prior written consent. 
  
 9.4    Termination.    The Parties agree that if this Agreement is terminated, neither Party shall disclose to
any Third Party [***] without the express written consent of the other Party, and the Parties shall agree on statements for public disclosure, such agreement not to be unreasonably withheld or delayed. This restriction shall not apply to disclosures
required by law or regulation. 
  
 ARTICLE 10 
  
 OWNERSHIP AND RIGHTS 
  
 10.1    Project Intellectual Property Ownership and Rights. 
  
 10.1.1    All right, title and interest in and to all inventions, discoveries, know-how, derivatives and improvements and other Technical Information (whether or not patentable), conceived, made,
created, invented or developed solely by DELTAGEN in connection with the activities conducted under the Development Program or otherwise in connection with this Agreement (including in connection with the selection of the Project Genes pursuant to
Section 4.1) shall be solely owned by DELTAGEN (“DELTAGEN Project Intellectual Property”). All right, title and interest in and to all inventions, discoveries, know-how, derivatives and improvements and other Technical
Information (whether or not patentable), conceived, made, created, invented or developed solely by HYSEQ in connection with the activities conducted in connection with the Development Program or otherwise in connection with this Agreement (including
in connection with the selection of the Project Genes pursuant to Section 4.1) shall be solely owned by HYSEQ (“HYSEQ Project Intellectual Property”). All right, title and interest in and to all inventions, discoveries,
know-how, derivatives and improvements and other Technical Information (whether or not patentable), conceived, made, created, invented or developed jointly by DELTAGEN and HYSEQ in connection with the activities conducted in connection with the
Development Program or in otherwise connection with this Agreement (including in connection with the selection of the Project Genes pursuant to Section 4.1) shall be jointly owned by 
 

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 DELTAGEN and HYSEQ (“Joint Project Intellectual Property”); provided, however, that Joint Project
Intellectual Property relating to the DELTAGEN Knock-Out Technology, including any methods or processes relating thereto, shall be owned by, and shall vest solely in, DELTAGEN and shall be deemed “DELTAGEN Project Intellectual
Property”. Patents covering HYSEQ Project Intellectual Property shall be referred to as “HYSEQ Project Patents” and shall be owned by, and shall vest in, HYSEQ and Patents covering DELTAGEN Project Intellectual Property
shall be referred to as “DELTAGEN Project Patents” and shall be owned by and shall vest in, DELTAGEN. Patents covering Joint Project Intellectual Property shall be referred to as “Joint Project Patents” and shall be
jointly owned by, and jointly vest in, the Parties. The Parties hereby agree that [***] for a Rejected Project Gene they shall make [***] of Joint Project Intellectual Property, including Joint Project Patents. If the Parties cannot mutually
agree on such [***], such Joint Project Intellectual Property and Joint Project Patents shall remain jointly owned by the Parties. 
  
 10.1.2    Each Party shall [***] to advise the other Party and the Steering Committee in writing of any Project Intellectual Property if and as it arises under the
Development Program. 
  
 10.1.3    Notwithstanding Section 10.1.1,
as between HYSEQ and DELTAGEN, all HYSEQ’s Technical Information and other of HYSEQ’s rights in and to the Proposed Genes that became Rejected Proposed Genes pursuant to Section 4.3 that were identified, or submitted to, the
Steering Committee and/or DELTAGEN pursuant to Section 4.1, shall be solely owned by and remain vested in, HYSEQ. 
  
 10.2    Further Assurances.    Each Party shall execute, or cause to be executed, any and all documentation, assignments, declarations, applications and/or other
instruments that may be reasonably necessary or desirable to effect each Party’s respective ownership rights as set forth in Section 10.1.1, including each Party’s respective rights in and to the Joint Project Intellectual Property
and the Joint Project Patents, as set forth in Section 10.1.1. 
  
 10.3    Patent
Prosecution and Maintenance. 
  
 10.3.1    Responsible Party and
Cooperation.    Each Party shall be responsible for the preparation, filing, prosecution and maintenance of its respectively solely owned Project 
 

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THE SECURITIES EXCHANGE ACT OF 1934, AS AMENDED. 

 Patents (each a “Responsible Party”). Unless otherwise agreed pursuant to Article 6 or Section 10.1.1,
DELTAGEN shall be responsible for the preparation, filing, prosecution and maintenance of all Joint Project Patents (in such case, the “Responsible Party”), provided that DELTAGEN shall provide the Steering Committee with access to
all drafts of provisional and patent applications for such Joint Project Patents. Upon the designation of a Project Gene as a Secreted Protein Candidate, the Parties will use good faith efforts to include in the joint development agreement: (i) the
Responsible Party for prosecution of such Joint Project Patents; (ii) that the Responsible Party shall consult with the other Party with respect to Patent matters for which it is responsible under this Section 10.3; and (iii) that the Parties
shall meet (whether in person or by video or telephone conference) on a regular basis to review and discuss, such matters. Without limiting the foregoing, with respect to Deltagen Project Patents and Joint Project Patents, DELTAGEN shall consult
with HYSEQ as to where and when to file patent applications which are included in the Patents for which it is responsible under this Section, and concerning the preparation, filing, prosecution, maintenance, and shall solicit HYSEQ’s advice and
provide HYSEQ with sufficient time prior to DELTAGEN having to respond or take action with respect to any such preparation, filing, prosecution, and maintenance of such matter, and shall take into account HYSEQ’s comments related thereto and
incorporate or act on such comments if and to the extent reasonable. 
  
 10.3.2    Patent Filing and Prosecution; and Updates.    If either Party identifies any invention covered by the HYSEQ Know-How or the Project Intellectual Property for
which it would like to seek patent protection, it shall notify the other Party, and the Parties shall review and discuss the filing of a patent application covering such invention. If, after such discussion, the Responsible Party decides to file a
patent application covering any such inventions, it shall prepare a patent application and provide the other Party with a copy of such draft application together with a preliminary determination of inventors and scope of claims. Each Party shall
advise the other Party within [***] of receiving any substantive action or development in the prosecution of any patent application it is responsible for prosecuting pursuant to this Section 10.3 (in particular any actions or developments
concerning which countries to continue prosecution of, questions of the scope, issuance or rejection of, any interference involving, any such patent application or any opposition to any such patent application or resulting patent). 

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WITH THE SECURITIES AND EXCHANGE COMMISSION PURSUANT TO RULE 24B-2 OF
THE SECURITIES EXCHANGE ACT OF 1934, AS AMENDED. 

  
 10.3.3    Election not to
Proceed.    On a Patent-by-Patent basis, if a Responsible Party, either prior or subsequent to filing any patent applications for Project Patents, elects not to file, prosecute or maintain such patent applications, or
maintain any ensuing Project Patents, it shall notify the other Party within [***] prior to allowing such Project Patent to lapse or become abandoned or unenforceable, and the other Party may elect to prepare, file, prosecute, maintain and enforce
such Project Patent. Without limiting the foregoing, if a Responsible Party plans to abandon any patent application in any Territory relating to a Project Gene in a Project Patent, the Responsible Party shall promptly notify the other Party, and
shall not abandon such patent application for [***] after such notification to allow the other Party, if it chooses, to continue to prosecute such patent application solely at its own cost and expense. The costs of filing, prosecuting, and
maintaining any Project Patent assumed by a Party pursuant to this Section 10.3.3 shall be the responsibility of such Party (but only if and to the extent such Party, in its sole discretion, decides to incur such costs), and shall not be
considered a Shared Patent Cost under Section 10.3.3(a). 
  
 (a)    Shared Patent Costs.    Except for costs and expenses incurred by a Party as set forth above in this Section 10.3.3, unless otherwise mutually agreed by the Parties,
all costs of prosecuting and maintaining Joint Project Patents shall be shared [***] by the Parties on a [***] basis (“Shared Patent Costs”). 
  
 In the event there is a good faith dispute over an amount owed by either Party under this Section 10.3.3(a), the disputed portion of the payment may be delayed, and such payment shall not be
considered delinquent pending a resolution of the Parties’ dispute other than with respect to the terms and conditions of Section 13.7. 
  
 10.3.4    Reports.    The Party performing the prosecution of any patent application under this
Section 10.3 shall provide the other Party with a report no less frequently than once every six (6) month period (or as otherwise mutually agreed by the Parties) listing all such patents and patent applications, identifying them by country
and patent or application number, and briefly describing the status thereof. 
  
 10.3.5    Other Cooperation and Assistance.    At the request of the Party performing the prosecution of any patent application under this Section 10.3, the other
Party 
 

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THE SECURITIES EXCHANGE ACT OF 1934, AS AMENDED. 

 shall cooperate, as reasonably requested, in connection with the prosecution of all such patent applications. Each Party
shall make available to the other or its respective authorized attorneys, agents or representatives such of its employees as the other Party in its reasonable judgment deems necessary in order to assist such other Party with the prosecution of such
patents. Each Party shall sign or use its best efforts to have signed and delivered at no charge to the other Party all legal documents reasonably necessary in connection with such prosecution and maintenance. Without in any way limiting anything
contained in this Section 10.3, (a) HYSEQ shall act in good faith to advise, and to consult with, DELTAGEN in connection with the preparation and prosecution of the Patent applications included in the HYSEQ Patents as they arise under this
Agreement and to mutually seek with DELTAGEN opportunities to prepare and file HYSEQ Patents, with the Parties goal being in each instance to try, where appropriate, to obtain the broadest Patent protection that is reasonably available; and (b)
DELTAGEN shall act in good faith to advise, and to consult with, HYSEQ in connection with the preparation and prosecution of the Patent applications included in the DELTAGEN Project Patents and Joint Project Patents as they arise under this
Agreement and to mutually seek with HYSEQ opportunities to prepare and file DELTAGEN Project Patents and Joint Project Patents, with the Parties’ goal being in each instance to try, where appropriate, to obtain the broadest Patent protection
that is reasonably available. Without limiting the foregoing, HYSEQ may use any Project data and results generated from any Project Knock-out Mouse, including data from the First Pass Phenotypic Analysis, to support prosecution of HYSEQ Patents as
reasonably necessary for such prosecution, and such use of data and results will not be considered a violation of the confidentiality provisions of Article 9 provided that such data and results have already been incorporated into a patent
application by DELTAGEN. 
  
 10.3.6    HYSEQ and DELTAGEN Project
Patents.    For the avoidance of doubt, as between DELTAGEN and HYSEQ, HYSEQ shall control all preparation, filing, prosecution and maintenance of any and all HYSEQ Project Patents and/or any Patents covering any HYSEQ
Project Intellectual Property or HYSEQ Know-How, and DELTAGEN shall control all preparation, filing, prosecution and maintenance of any and all DELTAGEN Project Patents and/or any Patents covering any DELTAGEN Project Intellectual Property or any
other Technical Information owned or controlled by DELTAGEN. 
 

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THE SECURITIES EXCHANGE ACT OF 1934, AS AMENDED. 

  
 ARTICLE 11 
  
 TERM AND TERMINATION 
  
 11.1    Term.    The term of this Agreement (the “Term”) shall commence as of the Effective Date and, unless sooner terminated by mutual agreement or
pursuant to any other provision of this Agreement, shall terminate upon the later to occur of: (a) the expiry of the last Valid Claim relating to a Project Gene or a Secreted Protein Candidate within the HYSEQ Patents or Project Patents, or (b) five
(5) years from the Effective Date. Upon expiration of this Agreement, the Parties shall have the licenses expressly provided for in Sections 2.1.3 and 2.3.1 of this Agreement. 
  
 11.2    Termination Events. 
  
 11.2.1    HYSEQ Funding Default.    If HYSEQ commits a material breach of any term or condition of this Agreement solely as a result of its
failure to pay DELTAGEN amounts owed to DELTAGEN pursuant to Section 5.1, and HYSEQ fails to cure such breach within ninety (90) days after receiving written notice of the breach from DELTAGEN, DELTAGEN may immediately terminate this
Agreement in its entirety upon written notice to HYSEQ at the end of such ninety (90) day period for the HYSEQ’s uncured breach; provided, however, that in the event that the amount or the obligation to pay such amount is the subject of a good
faith dispute between the Parties, such dispute shall be deemed as and treated as a Dispute (as such term is defined in Section 13.5.1) for the purposes of this Agreement and addressed by means of the dispute resolution provisions of
Section 13.5 and  until such time as the board of arbitrators, pursuant to Section 13.5, renders a final decision with respect to such Dispute the Parties shall continue to perform their obligations hereunder, except to the extent
mutually agreed to by the Parties or as directed by the arbitrators pursuant to Section 13.5. 
  
 11.2.2    Other Defaults.    Except as set forth in Section 11.2.1, if either Party commits a material breach of any term or condition of this Agreement, the
non-breaching Party may give the other Party written notice of the breach, and if the breach is not cured within ninety (90) days after receiving written notice of the breach, the non-breaching Party shall (i) have the right to terminate this
Agreement upon written notice to the breaching Party; and (ii) to submit the subject matter of the alleged breach to the dispute resolution process pursuant to Section 13.5 
 

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THE SECURITIES EXCHANGE ACT OF 1934, AS AMENDED. 

 within thirty (30) days of the end of such ninety (90) day period by giving the other Party written notice requesting
arbitration within such thirty (30) day period. Unless this Agreement is terminated by the non-breaching Party pursuant to this Section 11.2.2, the Parties shall continue to perform their obligations hereunder during the pendency of such
arbitration, except to the extent mutually agreed otherwise by the Parties or except as directed by the arbitrators. The arbitrators decision shall be binding upon the Parties except that in no event shall the arbitrators have the power or authority
to terminate this Agreement, either in whole or in part. 
  
 ARTICLE 12 
  
 EFFECT OF EXPIRATION AND TERMINATION; AND SURVIVABILITY 
  
 12.1    Effect of Termination Due to HYSEQ Funding Breach.    In the event that this Agreement is terminated by
DELTAGEN pursuant to Section 11.2.1: (a) HYSEQ shall terminate all activities, if any, undertaken by HYSEQ or its Affiliates or any of their employees, consultants, agents or contractors pursuant to or in connection with this Agreement in an
orderly manner, as soon as practical and in accordance with a schedule mutually agreed to by DELTAGEN and HYSEQ; and (b) to the extent not already provided to DELTAGEN, HYSEQ shall deliver to DELTAGEN all copies of all information and data generated
(in paper and, if available, electronic form) in connection with the activities conducted by HYSEQ or its Affiliates or any of their respective employees, consultants, agents or contractors under the Development Program. In addition to the
foregoing, HYSEQ hereby grants to DELTAGEN, a non-exclusive license, including the right to grant sublicenses (which sublicenses may include the right to grant further sublicenses), which license shall immediately and automatically be effective upon
termination of this Agreement by DELTAGEN pursuant to Section 11.2.1, under the HYSEQ Patents, HYSEQ Know-How, HYSEQ Project Patents, Joint Project Patents, HYSEQ Project Intellectual Property and Joint Project Intellectual Property, (i) to
analyze and use the Project Genes and any derivatives thereof, (ii) to use, make, create, generate, produce, breed, test, and conduct research and development activities in connection with Project Knock-Out Mice and progeny and other derivatives
thereof with respect to the Project Genes, (iii) to use, make, generate, produce, create, isolate, purify, identify and conduct research and development activities in connection with any Proposed Genes and/or Project Genes (and/or any 

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 mutation, fragment allelic variant, analog, homolog or ortholog of any Proposed Genes and/or Project Genes and/or any expression products
(including any Secreted Proteins, Derivative Proteins and/or Products) and/or derivatives thereof, and (iv) to develop, make, use and sell Secreted Protein Candidates and Products. 
  
 12.2    Return of Confidential Materials and Information.    Upon expiration of this Agreement, upon the other
Party’s written request, each Party shall either, as directed by the other Party, return to the other Party or certify in writing to the other Party that it has destroyed all documents and other tangible items provided by the other Party that
contain or relate to Confidential Information of the other Party (other than information that is considered joint Confidential Information of both Parties), including abstracts and summaries thereof; except if and to the extent, that the Parties
have otherwise expressly agreed in writing, including as the Parties may have agreed pursuant to Article 6 with respect to the development and/or commercialization of any Secreted Protein Candidate or any Products, either themselves, or
through or with any Affiliates or Third Parties. 
  
 12.3    Survivability.    Expiration or termination of this Agreement shall not affect each Party’s obligations to pay any amount accruing to the other Party under the
provisions of this Agreement while it was in effect. Further, the expiration or termination of this Agreement shall not affect any rights and obligations of the Parties under this Agreement which survive such termination. Without limiting the
generality of the foregoing, the following provisions of this Agreement shall survive expiration or termination hereof: Articles 1, 2 (only as expressly provided therein with respect to license grants that have not terminated by their
terms), 7, 8, 9, 10, 12 and 13 and Section 5.5.3.3. 
  
 ARTICLE 13 
  
 MISCELLANEOUS 
  
 13.1    Force Majeure.    If either Party is prevented from complying, either totally or in part, with any of the terms or provisions of this Agreement (other than a
payment obligation), by reason of force majeure, including, but not limited to fire, flood, earthquake, explosion, storm, strike, lockout or other labor trouble, riot, war, rebellion, accident, acts of God and/or any other cause or externally
induced casualty beyond its reasonable control, whether similar to the 
 

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THE SECURITIES EXCHANGE ACT OF 1934, AS AMENDED. 

 foregoing matters or not, then, upon written notice by the Party liable to perform to the other Party, the requirements of this Agreement or
such of its provisions as may be affected, and to the extent so affected, shall be suspended during the period of such disability. 
  
 13.2    No Assignment.    Neither Party shall, without the prior written consent (not to be unreasonably withheld) of the other Party having been obtained, assign
or transfer this Agreement, or any right or obligation under this Agreement, to any Person; provided, however, that each Party may assign or transfer this Agreement to any successor by merger of such Party, or upon a sale of all or substantially all
of such Party’s assets without the prior written consent of the other Party hereto. This Agreement shall be binding upon and shall inure to the benefit of the Parties and their successors and permitted assigns. 
  
 13.3    Notices.    Any notices required or permitted to be given hereunder
shall be in writing in the English language and shall be delivered in person or by Federal Express (or other courier service requiring signature upon receipt) or sent by air mail, postage prepaid, or facsimile (confirmed by a telephone conversation
with the recipient) to the addresses set forth below. The Parties may change the address at which notice is to be given by giving notice to the other Party as herein provided. All notices shall be deemed effective upon receipt by the Party to whom
it is addressed. 
  
 If to HYSEQ: 
  
 Hyseq Inc. 
 670 Almanor Avenue 

Sunnyvale, California 94085-3513 
 Attention:  President & CEO 
 cc:  General Counsel, at the same address 
 Fax:  (408) 524-8145 
 Phone:  (408) 524-8100 
 

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THE SECURITIES EXCHANGE ACT OF 1934, AS AMENDED. 

  
 If to DELTAGEN: 
  
 Deltagen Inc. 
 740 Bay Road 
 Redwood City, CA 94063-2469 
  
 Attention:  President 
 cc:  General Counsel, at the same address 
 Fax:  (650) 569-5280 
 Phone:  (650) 569-5100 
  
 13.4    Governing Law.    This Agreement and its execution, validity and interpretation shall be interpreted in accordance with and governed in all respects in accordance
with the laws of the State of California, and all rights and remedies shall be governed by such laws without regard to principles of conflicts of law. Subject to Section 13.5, the Parties hereby consent to the exclusive personal jurisdiction
and venue of the Superior Court of the County of Santa Clara in the State of California or, as applicable, the United States District Court for the Northern District of California, for all matters arising under or in connection with this Agreement.

  
 13.5    Dispute Resolution. 
  
 13.5.1    The Parties shall initially attempt in good faith to resolve any significant
controversy, claim, or dispute arising out of or relating to this Agreement or any significant breach thereof (hereinafter collectively referred to as a “Dispute”) through face-to-face negotiations between senior executives of HYSEQ
and DELTAGEN. If the Dispute is not resolved within thirty (30) days (or such other period of time mutually agreed upon by the Parties) of commencing such face-to-face negotiations, or if the Party against which a claim has been asserted refuses to
attend such negotiations or does not otherwise participate in such negotiations within thirty (30) days (or such other period of time mutually agreed upon by the Parties) from the date of notice of a Dispute, then the Parties agree to submit the
Dispute to arbitration as provided herein. Unless otherwise mutually agreed by the Parties, only if the Dispute is not resolved through face-to-face negotiations as set forth in this Section 13.5.1, may a Party resort to arbitration.

  
 13.5.2    Except as provided in Section 13.5.1 and Sections
3.3.4 and 6.3, all Disputes relating in any way to this Agreement shall be resolved exclusively through arbitration 
 

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 conducted under the auspices of the American Arbitration Association (the “AAA”) pursuant to its
Commercial Dispute Resolution Procedures; provided, however, that any disputes between the Parties concerning the infringement or validity of any intellectual property right subject to this Agreement shall be heard by a court of competent
jurisdiction. The arbitration shall be conducted in the English language before three (3) arbitrators, one selected by each Party and the third to be selected by the other two. For any Dispute arising out of a non-concurrence of the Steering
Committee such arbitrators shall have the appropriate technical and scientific background. Unless otherwise mutually agreed by the Parties, any arbitration brought hereunder shall be brought only and exclusively in the State of California. The
arbitrators shall hear evidence by each Party and resolve each of the issues identified by the Parties. The arbitrators shall render a formal, binding non-appealable resolution and award on each issue as expeditiously as possible, but not more than
fifteen (15) business days after the hearing. In any arbitration, the prevailing Party shall be entitled to reimbursement of its reasonable attorneys’ fees and the Parties shall use all reasonable efforts to keep arbitration costs to a minimum.

  
 13.5.3    Notwithstanding anything contained herein, in no event shall
arbitrators have the power or authority to terminate this Agreement in whole or in part. 
  
 13.5.4    Nothing in this Agreement shall be deemed as preventing either Party from seeking injunctive relief (or any other provisional remedy) from any court having jurisdiction over the Parties and the
subject matter of the dispute as necessary to protect either Party’s intellectual property. 
  
 13.6    License Survival During Bankruptcy.    All rights and licenses granted under or pursuant to this Agreement are, and shall otherwise be deemed to be, for purposes of
Paragraph 365(n) of the U.S. Bankruptcy Code, licenses of rights to “intellectual property” as defined under Paragraph 101(35A) of the U.S. Bankruptcy Code. The Parties agree that each Party, as a licensee of such rights under this
Agreement, shall retain and may fully exercise all of its rights and elections under the U.S. Bankruptcy Code, subject to performance by the other Party of its preexisting obligations under this Agreement. The Parties further agree that, in the
event of the commencement of a bankruptcy proceeding by or against a Party, including under the U.S. Bankruptcy Code, the other Party shall be entitled to a complete duplicate of (or complete access 
 

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 to, as appropriate) any such intellectual property, and all embodiments of such intellectual property, shall be promptly delivered to the other
Party upon any such commencement of a bankruptcy proceeding upon written request therefor by the other Party. 
  
 13.7    Interest.    The Parties shall pay interest on any amounts overdue under this Agreement at a rate of the lesser of the maximum allowed by applicable law or [***]
above the U.S. dollar prime or equivalent rate quoted by Citibank N.A. or another mutually acceptable bank, as in effect during the period from the date due until payment, including from the date any amounts disputed in good faith by the Parties
were originally due and payable hereunder. This Section 13.7 shall apply to any amounts either Party may dispute under this Agreement for any reason, even disputes initiated in good faith; provided, however, that such amounts shall not be due
and payable if a final decision by a court of competent jurisdiction or AAA under Section 13.5 is rendered in favor of the Party withholding the payment and such final decision declares such disputed amounts not due under this Agreement.

  
 13.8    Interpretation.    The parties hereby
acknowledge and agree that they each required that this Agreement and all documents and notices in connection herewith be drawn up in English. This Agreement shall be deemed to comprise the language mutually chosen by the Parties, has been prepared
jointly and no rule of strict construction shall be applied against either Party. In this Agreement, the singular shall include the plural and vice versa and the word “including” shall be deemed to be followed by the phrase “without
limitation”. 
  
 13.9    Severability.    In the
event that any provision of this Agreement shall be held to be unenforceable, invalid or in contravention of applicable law, such provision shall be of no effect, and the Parties shall negotiate in good faith to replace such provision with a
provision which effects to the extent possible the original intent of such provision. 
  
 13.10    Complete Agreement.    This Agreement, including all Exhibits hereto, supersedes all prior understandings, agreements, representations and warranties between the
Parties, oral or written with respect to the present subject matter, and comprises the complete agreement between the Parties with respect to the present subject matter. 
  
 13.11    Modifications.    No terms or provisions of this Agreement shall be varied or modified by any prior or
subsequent statement, conduct or act of either of the Parties, except that 
 

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 the Parties may amend this Agreement by written instruments specifically referring to this Agreement and executed by a duly authorized officer
of each of the Parties. 
  
 13.12    No
Agency.    Neither Party shall by virtue of this Agreement have any power to make on behalf of the other Party any statements, representations or commitments of any kind or to bind the other to any obligation nor shall
this Agreement create any relationship of agency, partnership or joint venture or any fiduciary relationship between the Parties. 
  
 13.13    No Waiver.    No term or condition of this Agreement shall be considered waived unless reduced to writing and duly executed by a duly authorized officer of the
waiving Party. Any waiver by any Party of a breach of any term or condition of this Agreement will not be considered as a waiver of any subsequent breach of this Agreement, of that term or condition or any other term or condition hereof.

  
 13.14    Counterparts.    The Agreement may be
executed simultaneously in one or more counterparts, each one of which need not contain the signature of more than one Party but such counterparts taken together shall constitute one and the same agreement. 
  
 *    *    *    *    * 
 

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 IN WITNESS WHEREOF, the Parties have executed this Agreement as of the
date first above written. 
  
 
	 HYSEQ, INC.
  
  
 By:      /s/    Ted W. Love,
M.D.                                        
            
  
 Name:
      Ted W. Love,
M.D.                                        
               
  
 Title:      President &
CEO                                        
                      
  
 Date:      10/09/01                             
                                        
       
 	 	 DELTAGEN INC.
  
  
 By:      /s/    John
Burke                                       
                         
  
 Name:      John
Burke                                       
                          
  
 Title:      V.P. Intellectual
Property                                       
     
  
 Date:      10/09/01                             
                                        
    
 

 
  
 

 

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 EXHIBIT A 
  
 [***] 
  
 [***]

  
 [***] 
  
 [***] 
 

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 [***] 
  
 [***] 
 

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 [***] 
  
 [***] 
 

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 [***] 
  
 [***] 
 

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 [***] 
  
 [***] 
 

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 [***] 
  
 [***] 
  
 

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 EXHIBIT B 
  
 Section 6. 3 Mediation 
  
 [***]

  
 

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 EXHIBIT C 
  
 Work Plan 
  

	1.
	 
	Within [***] of the first Steering Committee meeting, HYSEQ will provide to Deltagen [***]. Within [***] of the Effective Date, HYSEQ will provide to Deltagen
[***], in accordance with the terms and conditions of this Agreement, [***] sufficient to allow the Steering Committee to [***]. 
 

  

	2.
	 
	Deltagen will evaluate such [***] for conflict purposes and either reject or accept each such Submitted Gene as a Proposed Gene within [***] of its submission.
Hyseq will provide supporting information and disclosures as in paragraph 4.1.3 of the Agreement within [***] of Deltagen’s acceptance of a [***]. To maximize efficiency, each Party will endeavour to provide information to the other party in
[***]. 
 

  

	3.
	 
	The Steering Committee will vote on whether to designate a [***]. The time periods for submissions of information and voting will be set so as to allow [***]
within [***] after the Effective Date. 
 

  

	4.
	 
	Deltagen will create a [***] to create and generate a [***] within which the [***] of the [***] has been [***]. 
 

  

	5.
	 
	The time periods for paragraph 4 will be set so that the targeting strategy for generation of [***] for the first [***] has been created and completed within
[***] after these [***] have been designated. The targeting strategy for generation of [***] for the remaining [***] will be created and completed [***] after these [***] have been designated. 
 

  

	6.
	 
	Deltagen will use the [***] to generate [***] and conduct a [***] as described in Exhibit A. The Steering Committee will be kept informed of the status
of each project [***]. 
 

  
 

 C-1 

 

 CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN
THIS DOCUMENT, MARKED BY BRACKETS, HAS BEEN OMITTED AND FILED SEPARATELY
WITH THE SECURITIES AND EXCHANGE COMMISSION PURSUANT TO RULE 24B-2 OF
THE SECURITIES EXCHANGE ACT OF 1934, AS AMENDED. 

  
 EXHIBIT D 
  
 Disclosures 
  
 [***] 

 D-1 

 

 CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN
THIS DOCUMENT, MARKED BY BRACKETS, HAS BEEN OMITTED AND FILED SEPARATELY
WITH THE SECURITIES AND EXCHANGE COMMISSION PURSUANT TO RULE 24B-2 OF
THE SECURITIES EXCHANGE ACT OF 1934, AS AMENDED.EXHIBIT 4.4

                      MONSANTO SAVINGS AND INVESTMENT PLAN

                (AMENDED AND RESTATED EFFECTIVE AUGUST 13, 2002)

<PAGE>

                                TABLE OF CONTENTS

SECTION 1 Introduction.........................................................1
         1.1      THE PLAN.....................................................1
         1.2      PURPOSE......................................................5
         1.3      PLAN ADMINISTRATION..........................................6
         1.4      FUND COMMITTEE, TRUST AGREEMENT..............................6
         1.5      ESTABLISHMENT, EFFECTIVE DATE AND RESTATEMENT DATE...........7
         1.6      ACCOUNTING DATES.............................................7
         1.7      PLAN YEAR....................................................7
         1.8      EMPLOYERS....................................................7
         1.9      USE OF TERMS.................................................7
         1.10     SUPPLEMENTS..................................................7
         1.11     FISCAL YEAR..................................................8

SECTION 2 Participation........................................................8
         2.1      ELIGIBILITY..................................................8
         2.2      SERVICE......................................................9
         2.3      NOTICE OF ELIGIBILITY, ELECTION OF PARTICIPATION............12
         2.4      CHANGE IN PARTICIPANT'S STATUS..............................12
         2.5      RESTRICTED PARTICIPATION....................................13

SECTION 3 Form of Participation...............................................13
         3.1      PARTICIPANT ACCOUNTS........................................13
         3.2      EMPLOYER MATCHING CONTRIBUTION..............................14
         3.3      VARIATION OF CONTRIBUTIONS..................................14
         3.4      DISCONTINUANCE AND RESUMPTION OF CONTRIBUTIONS..............14
         3.5      DIRECT ROLLOVER CONTRIBUTIONS...............................15

SECTION 4 Before-Tax Contributions............................................17
         4.1      AUTHORIZATION OF BEFORE-TAX CONTRIBUTIONS...................17
         4.2      MATCHED BEFORE-TAX  CONTRIBUTIONS...........................17
         4.3      SUPPLEMENTAL BEFORE-TAX CONTRIBUTIONS.......................17
         4.4      LIMITATION ON BEFORE-TAX CONTRIBUTIONS......................18
         4.5      ELIGIBLE EARNINGS...........................................18
         4.6      DEDUCTION OF PARTICIPANT CONTRIBUTIONS......................19
         4.7      CANCELLATION OF BEFORE-TAX CONTRIBUTIONS....................19
         4.8      LIMITATION ON BEFORE-TAX CONTRIBUTIONS......................19

SECTION 5 After-Tax Contributions.............................................20
         5.1      AUTHORIZATION OF AFTER-TAX CONTRIBUTIONS....................20
         5.2      MATCHED AFTER-TAX CONTRIBUTIONS.............................20
         5.3      SUPPLEMENTAL AFTER-TAX CONTRIBUTIONS........................21
         5.4      LIMITATION ON AFTER-TAX CONTRIBUTIONS.......................21
         5.5      DEDUCTION OF PARTICIPANT AFTER-TAX CONTRIBUTIONS............21
         5.6      CESSATION OF AFTER-TAX CONTRIBUTIONS........................21

SECTION 6 Employer Contributions..............................................22
         6.1      EMPLOYER  MATCHING CONTRIBUTIONS............................22
         6.2      VACATION CONTRIBUTIONS......................................24
         6.3      CORRECTING CONTRIBUTION.....................................24

SECTION 7 Limitations on Contributions........................................24
         7.1      LIMITATION ON EMPLOYER CONTRIBUTIONS........................24
         7.2      LIMITATIONS ON CONTRIBUTIONS................................24
         7.3      DEFINITIONS.................................................26
                  (a)      "Annual Addition"..................................26
                  (b)      "Extended Group"...................................26
                  (c)      "Defined Contribution Plans".......................27
                  (d)      "Compensation".....................................27
                  (e)      "Contribution Percentage"..........................27
                  (f)      "Contribution Percentage Amounts"..................28
                  (g)      "Excess Aggregate Contributions"...................28
                  (h)      "Excess Before-Tax Contributions"..................29
                  (i)      "Highly Compensated Employee"......................29
                  (j)      "Qualified Matching Contributions".................30
                  (k)      "Qualified Non-elective Contributions".............30
         7.4      ACTUAL DEFERRAL PERCENTAGE TEST.............................30
                  (a)      DISTRIBUTION METHOD................................31
                  (b)      ADDITIONAL CONTRIBUTIONS METHOD....................32
                  (c)      RECHARACTERIZATION METHOD..........................32
         7.5      ACTUAL CONTRIBUTION PERCENTAGE TEST.........................32
                  (a)      DISTRIBUTION METHOD................................33
                  (b)      ADDITIONAL CONTRIBUTIONS METHOD....................34
         7.6      CATCH-UP CONTRIBUTIONS......................................34

SECTION 8 Accounting..........................................................35
         8.1      PARTICIPANT ACCOUNTS........................................35
                  (a)      "MATCHED BEFORE-TAX ACCOUNT".......................35
                  (b)      "SUPPLEMENTAL BEFORE-TAX ACCOUNT"..................35
                  (c)      "MATCHED AFTER-TAX ACCOUNT"........................35
                  (d)      "SUPPLEMENTAL AFTER-TAX ACCOUNT"...................35
                  (e)      "DIRECT ROLLOVER ACCOUNT"..........................35
         8.2      EMPLOYER ACCOUNTS...........................................36
         8.3      EMPLOYEE STOCK ACCOUNT......................................36
         8.4      OTHER ACCOUNTS..............................................36
         8.5      EMPLOYER CONTRIBUTIONS......................................36
         8.6      ADJUSTMENT OF PARTICIPANTS' ACCOUNTS........................37
         8.7      CHARGING PAYMENTS AND DISTRIBUTIONS.........................38
         8.8      ALLOCATION OF EMPLOYER CONTRIBUTIONS AND FORFEITURES........38
         8.9      CREDITING AFTER-TAX CONTRIBUTIONS...........................39
         8.10     CREDITING BEFORE-TAX CONTRIBUTIONS..........................40
         8.11     ALLOCATIONS PURSUANT TO QUALIFIED DOMESTIC RELATIONS
                    ORDER.....................................................40

<PAGE>

SECTION 9 The Trust Fund, the Investment Funds and the Loan Fund..............41
         9.1      THE TRUST FUND..............................................41
         9.2      THE INVESTMENT FUNDS, THE PHARMACIA STOCK FUND AND THE
                    CHEMICAL STOCK FUND.......................................41
         9.3      THE LOAN FUND...............................................43
         9.4      INVESTMENT ELECTIONS........................................43
         9.5      (a)      INVESTMENT OF EMPLOYER CONTRIBUTIONS...............44
                  (b)      DIVERSIFICATION ELECTION...........................44
                  (c)      EMPLOYER ACCOUNTS TRANSFER ELECTION................45
         9.6      VOTING RIGHTS...............................................46
         9.7      TRANSFERS AMONG INVESTMENT FUNDS, PHARMACIA OR CHEMICAL
                    STOCK FUNDS, AND/OR PRE-MIXED PORTFOLIOS..................48
                  (a)      TRANSFER ELECTION..................................48
                  (b)      MARKET OR MINIMUM PRICE ELECTION...................48
                  (c)      TRANSFER RESTRICTIONS..............................49

         9.8      PLAN EXPENSES...............................................50
                  (a)      ADMINISTRATIVE EXPENSE.............................50
                  (b)      INVESTMENT FUND EXPENSES...........................50

SECTION 10 Payment of Account Balances........................................51
         10.1     PARTICIPANT ACCOUNTS........................................51
         10.2     EMPLOYER ACCOUNTS...........................................51
         10.3     FORFEITURES.................................................53
         10.4     TIMING OF DISTRIBUTIONS.....................................54
         10.5     DISTRIBUTION OPTIONS........................................57
                  (a)      LUMP SUM DISTRIBUTION..............................57
                  (b)      INSTALLMENT PAYOUT OPTION..........................57
                  (c)      COMMON STOCK OF COMPANY............................58
                  (d)      COMMON STOCK OF PHARMACIA..........................60
                  (e)      COMMON STOCK OF SOLUTIA INC........................60
                  (f)      PARTIAL DISTRIBUTION...............................61
                  (g)      NOTICE REGARDING DISTRIBUTION OPTIONS..............61
         10.6     DESIGNATION OF BENEFICIARIES................................62

SECTION 11 Withdrawals........................................................64
         11.1     WITHDRAWALS BY PARTICIPANTS WITH FIVE OR MORE YEARS
                    OF PARTICIPATION..........................................64
         11.2     WITHDRAWALS BY PARTICIPANTS WITH LESS THAN FIVE
                    YEARS OF PARTICIPATION....................................64
         11.3     WITHDRAWALS AND DISTRIBUTIONS FROM BEFORE-TAX
                    ACCOUNTS AND DIRECT ROLLOVER ACCOUNTS PROHIBITED..........65
         11.4     AGE 59-1/2 WITHDRAWALS......................................65
         11.5     CHARGING AND ALLOCATIONS OF WITHDRAWALS.....................65

SECTION 12 Loans..............................................................65
         12.1     LOANS.......................................................65
         12.2     LOAN ADMINISTRATION.........................................65
         12.3     LOAN ELIGIBILITY............................................66
         12.4     LOAN APPLICATION............................................66
         12.5     TERMS AND CONDITIONS OF LOANS...............................67
         12.6     MAXIMUM LOAN................................................67
         12.7     INTEREST....................................................67
         12.8     TERM OF LOAN AND REPAYMENT..................................68
         12.9     SOURCE OF LOAN FUNDS........................................69
         12.10    ACCOUNTING FOR LOANS........................................69
         12.11    WITHDRAWALS AND DISTRIBUTIONS WHILE LOAN BALANCE
                    IS OUTSTANDING............................................70
         12.12    UNPAID BALANCES AT END OF SIXTY-MONTH REPAYMENT PERIOD......71
         12.13    HARDSHIP WITHDRAWAL IN BANKRUPTCY...........................71
         12.14    FAILURE TO REPAY LOANS......................................72
         12.15    LOANS TO CERTAIN TERMINATED OR RETIRED PARTICIPANTS.........72

SECTION 13 The Plan Committee.................................................72
         13.1     MEMBERSHIP..................................................72
         13.2     PLAN COMMITTEE'S GENERAL POWERS, RIGHTS AND DUTIES..........72
         13.3     MANNER OF ACTION............................................73
         13.4     INFORMATION REQUIRED BY PLAN COMMITTEE......................74
         13.5     PLAN COMMITTEE DECISION FINAL...............................75
         13.6     REVIEW OF BENEFIT DETERMINATIONS............................75
         13.7     DELEGATION OF AUTHORITY.....................................75
         13.8     UNIFORM RULES...............................................75

SECTION 14 Relating to the Employers..........................................75
         14.1     ACTION BY EMPLOYERS.........................................75
         14.2     ADDITIONAL EMPLOYERS........................................75
         14.3     RESTRICTIONS AS TO REVERSION OF TRUST ASSETS
                    TO EMPLOYERS..............................................76

SECTION 15 General Provisions.................................................76
         15.1     NOTICES.....................................................76
         15.2     WAIVER OF NOTICE............................................76
         15.3     ABSENCE OF GUARANTY.........................................76
         15.4     EMPLOYMENT RIGHTS...........................................77
         15.5     INTERESTS NOT TRANSFERABLE..................................77
         15.6     FACILITY OF PAYMENT.........................................77
         15.7     GENDER AND NUMBER...........................................77
         15.8     EVIDENCE....................................................78
         15.9     INDEMNITY...................................................78
         15.10    CONTROLLING STATE LAW.......................................78
         15.11    SEVERABILITY................................................78
         15.12    HEADINGS....................................................78
         15.13    SUCCESSORS..................................................78
         15.14    NO REDUCTIONS FOR SOCIAL SECURITY INCREASES.................79
         15.15    MILITARY SERVICE............................................79

SECTION 16 Amendment, Termination or Plan Merger..............................79
         16.1     AMENDMENT...................................................79
         16.2     TERMINATION.................................................79
         16.3     PLAN MERGER OR CONSOLIDATION................................80
         16.4     NOTICE OF AMENDMENT, TERMINATION OR PLAN MERGER.............80
         16.5     VESTING AND DISTRIBUTION ON TERMINATION.....................80
         16.6     TRANSFER OF ASSETS AND LIABILITIES..........................81

SECTION 17 Directed Rollovers.................................................82
         17.1     DIRECTED ROLLOVERS..........................................82
         17.2     ELIGIBLE ROLLOVER DISTRIBUTION..............................82
         17.3     ELIGIBLE RETIREMENT PLAN....................................82
         17.4     DISTRIBUTEE.................................................83
         17.5     DIRECT ROLLOVER.............................................83

SECTION 18 Top-Heavy Provisions...............................................83
         18.1     DETERMINATION OF TOP-HEAVY..................................83
         18.2     MINIMUM ALLOCATIONS.........................................84
         18.3     MINIMUM VESTING.............................................85
         18.4     REPEAL, MODIFICATION OR POSTPONEMENT OF TOP-HEAVY
                    PROVISIONS................................................85
         18.5     NON-KEY EMPLOYEE............................................85
         18.6     COMPENSATION................................................85
         18.7     TOP-HEAVY RATIO.............................................85

SECTION 19 Employee Stock Ownership Plan Provisions...........................87
         19.1     EMPLOYEE STOCK OWNERSHIP PROVISIONS OF THE PLAN.............87
         19.2     EFFECTIVE DATE..............................................88
         19.3     DEFINITIONS.................................................89
                  (a)      ALLOCATED DIVIDENDS................................89
                  (b)      DISQUALIFIED PERSON................................89
                  (c)      EMPLOYER CONTRIBUTIONS.............................89
                  (d)      ESOP INTERIM ACCOUNT...............................89
                  (e)      ESOP LOAN..........................................89
                  (f)      ESOP PAYMENT ACCOUNT...............................89
                  (g)      ESOP SUSPENSE ACCOUNT..............................89
                  (h)      FINANCED SHARES....................................89
                  (i)      TRUST AGREEMENT....................................90
                  (j)      TRUSTEE............................................90
                  (k)      UNALLOCATED DIVIDENDS..............................90
         19.4     ESOP LOAN...................................................90
                  (a)      AUTHORITY..........................................90
                  (b)      CONDITIONS OF LOANS................................90
                  (c)      USE OF LOAN PROCEEDS...............................91
                  (d)      ESOP SUSPENSE ACCOUNT..............................91
                  (e)      LIABILITY AND COLLATERAL FOR LOAN..................91
         19.5     REPAYMENT OF LOAN; ESOP PAYMENT ACCOUNT.....................92
                  (a)      PAYMENTS GENERALLY.................................92
                  (b)      DEFAULT PROVISION..................................93
                  (c)      SALE OF EMPLOYER STOCK IN THE SUSPENSE
                             ACCOUNT..........................................93
                  (d)      EXCESS IN SUSPENSE ACCOUNT.........................94
                  (e)      REFINANCING........................................94
                  (f)      INVESTMENT OF ASSETS HELD IN ESOP
                             PAYMENT ACCOUNT..................................94
         19.6     RELEASE FROM SUSPENSE ACCOUNT AND ALLOCATION AMONG
                    PARTICIPANTS' ACCOUNTS....................................94
                  (a)      ANNUAL RELEASE FROM SUSPENSE ACCOUNT...............94
                  (b)      ALLOCATION OF RELEASED SHARES......................96
         19.7     PROCEEDS OF ESOP LOANS......................................98
         19.8     ACQUISITION AND DISPOSITION OF COMMON STOCK OF THE
                    COMPANY...................................................99
                  (a)      GENERAL............................................99
                  (b)      TRANSACTION WITH DISQUALIFIED PERSON...............99
                  (c)      EXPENSES...........................................99
         19.9     EMPLOYER CONTRIBUTIONS TO RETIRE DEBT......................100
         19.10    PUT OPTION.................................................100
                  (a)      QUALIFIED HOLDER..................................100
                  (b)      INITIAL TERM......................................100
                  (c)      SUBSEQUENT TERM...................................101
                  (d)      TRUSTEE'S PURCHASE RIGHTS.........................101
                  (e)      EXCEPTION TO TERM LIMITS..........................101
                  (f)      EFFECT OF CODE AND REGULATIONS....................101
                  (g)      EXERCISE..........................................102
                  (h)      SURVIVAL OF PUT OPTION RIGHT......................102
         19.11    VALUATION..................................................102
         19.12    FORFEITURE RULE............................................102
         19.13    DIVIDENDS PAID ON COMMON STOCK OF THE COMPANY
                    OTHER THAN FINANCED SHARES...............................102
         19.14    CHANGES IN ALLOCATION AND FORFEITURE FORMULAE..............102
         19.15    STATUS OF DELEGATES........................................103

SECTION 20 Definitions.......................................................103
         20.1     ACCOUNTING DATE............................................103
         20.2     ACCOUNTS...................................................103
         20.3     AFFILIATE..................................................103
         20.4     AFTER-TAX ACCOUNTS.........................................104
         20.5     AFTER-TAX CONTRIBUTIONS....................................104
         20.6     ALLOCATED DIVIDENDS........................................104
         20.7     ANNUAL ADDITIONS...........................................104
         20.8     BEFORE-TAX ACCOUNTS........................................104
         20.9     BEFORE-TAX CONTRIBUTIONS...................................104
         20.10    BREAK IN SERVICE...........................................104
         20.11    CHANGE OF CONTROL..........................................105
         20.12    CHEMICAL STOCK FUND........................................107
         20.13    CODE.......................................................107
         20.14    COMPANY....................................................107
         20.15    COMPANY STOCK FUND.........................................107
         20.16    COMPENSATION...............................................107
         20.17    CONTRIBUTION PERCENTAGE....................................107
         20.18    CONTRIBUTION PERCENTAGE AMOUNTS............................107
         20.19    DEFINED CONTRIBUTION PLANS.................................107
         20.20    DIRECT ROLLOVER ACCOUNT....................................107
         20.21    DIRECT ROLLOVER CONTRIBUTIONS..............................107
         20.22    DISABILITY.................................................107
         20.23    DISABLED...................................................107
         20.24    DISCRETIONARY MATCHED CONTRIBUTIONS........................108
         20.25    DISQUALIFIED PERSON........................................108
         20.26    DIVERSIFICATION ELECTION...................................108
         20.27    EFFECTIVE DATE.............................................108
         20.28    ELIGIBLE EARNINGS..........................................108
         20.29    EMPLOYEE STOCK ACCOUNT.....................................108
         20.30    EMPLOYER...................................................108
         20.31    EMPLOYER ACCOUNTS..........................................108
         20.32    EMPLOYER CONTRIBUTIONS.....................................108
         20.33    EMPLOYER MATCHING ACCOUNT..................................108
         20.34    EMPLOYER MATCHING CONTRIBUTIONS............................108
         20.35    EMPLOYER SECURITIES........................................108
         20.36    EMPLOYMENT COMMENCEMENT DATE...............................108
         20.37    ERISA......................................................109
         20.38    ESOP.......................................................109
         20.39    ESOP INTERIM ACCOUNT.......................................109
         20.40    ESOP LOAN..................................................109
         20.41    ESOP PAYMENT ACCOUNT.......................................109
         20.42    ESOP SUSPENSE ACCOUNT......................................109
         20.43    EXCESS AGGREGATE CONTRIBUTIONS.............................109
         20.44    EXCESS BEFORE-TAX CONTRIBUTIONS............................109
         20.45    EXTENDED GROUP.............................................109
         20.46    FINANCED SHARES............................................109
         20.47    FISCAL YEAR................................................109
         20.48    FIVE-YEAR BREAK IN SERVICE.................................109
         20.49    FORFEITURES................................................109
         20.50    FORMER PHARMACIA PARTICIPANT...............................109
         20.51    FUND COMMITTEE.............................................109
         20.52    HIGHLY COMPENSATED EMPLOYEE................................110
         20.53    HOUR OF SERVICE............................................110
         20.54    INCENTIVE PAY..............................................110
         20.55    INDEPENDENT FIDUCIARY......................................110
         20.56    INSURANCE COMPANY..........................................110
         20.57    INVESTMENT FUNDS...........................................110
         20.58    INVESTMENT MANAGER.........................................110
         20.59    LAYOFF.....................................................110
         20.60    LEASED EMPLOYEE............................................110
         20.61    LOAN ACCOUNTS..............................................110
         20.62    LOAN FUND..................................................110
         20.63    LOAN PROCEDURES............................................110
         20.64    MATCHED AFTER-TAX ACCOUNT..................................110
         20.65    MATCHED AFTER-TAX CONTRIBUTIONS............................110
         20.66    MATCHED BEFORE-TAX ACCOUNT.................................110
         20.67    MATCHED BEFORE-TAX CONTRIBUTIONS...........................110
         20.68    MATERNITY OR PATERNITY ABSENCE.............................111
         20.69    NORMAL RETIREMENT AGE......................................111
         20.70    NUTRASWEET CAP.............................................111
         20.71    PARTICIPANT ACCOUNTS.......................................111
         20.72    PHARMACIA..................................................111
         20.73    PHARMACIA STOCK FUND.......................................111
         20.74    PLAN.......................................................111
         20.75    PLAN COMMITTEE.............................................111
         20.76    PLAN YEAR..................................................111
         20.77    PREDECESSOR COMPANY........................................111
         20.78    PRE-MIXED PORTFOLIO........................................111
         20.79    QDRO.......................................................112
         20.80    QUALIFIED MATCHING CONTRIBUTIONS...........................112
         20.81    QUALIFIED NON-ELECTIVE CONTRIBUTIONS.......................112
         20.82    REEMPLOYMENT COMMENCEMENT DATE.............................112
         20.83    REGULAR ACCOUNTING DATE....................................112
         20.84    REQUIRED BEGINNING DATE....................................112
         20.85    RESTATEMENT DATE...........................................112
         20.86    SEARLE CAP.................................................112
         20.87    SEPARATION DATE............................................112
         20.88    SPECIAL ACCOUNTING DATE....................................112
         20.89    SPINOFF DATE...............................................113
         20.90    STANDARD WORK WEEK AND YEAR................................113
         20.91    SUBSIDIARY.................................................113
         20.92    SUPPLEMENTAL AFTER-TAX ACCOUNT.............................113
         20.93    SUPPLEMENTAL AFTER-TAX CONTRIBUTIONS.......................113
         20.94    SUPPLEMENTAL BEFORE-TAX ACCOUNT............................113
         20.95    SUPPLEMENTAL BEFORE-TAX CONTRIBUTIONS......................113
         20.96    TRUST AGREEMENT............................................113
         20.97    TRUST FUND.................................................113
         20.98    TRUSTEE....................................................113
         20.99    UNALLOCATED DIVIDENDS......................................113
         20.100   VACATION ACCOUNT...........................................113
         20.101   VACATION CONTRIBUTIONS.....................................113
         20.102   VESTING PERCENTAGE.........................................114
         20.103   YEAR OF SERVICE............................................114

<PAGE>
                      MONSANTO SAVINGS AND INVESTMENT PLAN

                                   SECTION 1
                                  INTRODUCTION
                                  ------------

1.1  THE PLAN.  Monsanto Company, a Delaware  corporation which was incorporated
     on  February 9, 2000 under the name  Monsanto Ag Company and which  changed
     its  name  to  Monsanto   Company  on  March  31,  2000  (the   "Company"),
     established,  as of June 11, 2001, the MONSANTO SAVINGS AND INVESTMENT PLAN
     (the "PLAN").

     Effective as of October 1, 1974, Pharmacia  Corporation (prior to March 31,
     2000, known as Monsanto  Company)  ("PHARMACIA")  established the Pharmacia
     Savings and Investment Plan  (previously  known as the Monsanto Savings and
     Investment  Plan) (the  "PHARMACIA  PLAN") for the Plan Year  beginning  on
     January 1, 1974, which Pharmacia Plan was amended from time to time.

     Pharmacia,  prior to January 1, 1997,  maintained  separate  401(k) defined
     contribution  plans known as The NutraSweet  Company  Capital  Accumulation
     Plan ("NUTRASWEET  CAP") and the Searle Capital  Accumulation Plan ("SEARLE
     CAP") for the  benefit of eligible  employees  of certain  business  units.
     Effective  January 1, 1997,  NutraSweet CAP and Searle CAP were merged into
     the Pharmacia Plan and, pursuant to such merger,  all assets of those plans
     became assets of the Pharmacia Plan effective as of January 1, 1997 and the
     Pharmacia  Plan  assumed  the  liabilities  of those plans as of January 1,
     1997.

     Pharmacia,  prior to April 1, 1997,  maintained a separate  401(k)  defined
     contribution  plan known as the Diamonex,  Incorporated  401(k)  Retirement
     Savings Plan ("DIAMONEX  401(K) PLAN").  Effective as of April 1, 1997, the
     Diamonex  401(k) Plan was merged into the Pharmacia  Plan and,  pursuant to
     such merger,  all assets of that plan became assets of the  Pharmacia  Plan
     effective  as  of  April  1,  1997  and  the  Pharmacia  Plan  assumed  the
     liabilities of that plan as of April 1, 1997.

     Pharmacia,  prior to July 31,  1997,  maintained a separate  payroll  based
     employee stock ownership plan known as the Monsanto Company Payroll Related
     Employee Stock  Ownership Plan  ("PAYSOP").  Effective as of July 31, 1997,
     PAYSOP was merged into the Pharmacia Plan and, pursuant to such merger, all
     assets of that plan became  assets of the  Pharmacia  Plan  effective as of
     July 31, 1997 and the Pharmacia  Plan assumed the  liabilities of that plan
     as of July 31, 1997.  A  participant's  PAYSOP  account was credited to his
     Employer Matching Account.

     Effective  September 1, 1997,  Pharmacia  spun off its chemical  businesses
     into a separate publicly owned company, Solutia Inc. In connection with the
     spinoff all of the Pharmacia  Plan assets and  liabilities  relating to the
     following  were  transferred to Solutia Inc.  Savings and  Investment  Plan
     effective as of September 1, 1997:  (a) Annex B of the  Pharmacia  Plan and
     (b) Solutia  Inc.  Participants  (as defined in the  Employee  Benefits and
     Compensation  Allocation Agreement between Pharmacia and Solutia Inc. dated
     as of  September 1, 1997  ("ALLOCATION  AGREEMENT")),  other than  Retained
     Solutia  Inactive  Participants  (as defined in the Allocation  Agreement),
     under Annex A of the Pharmacia Plan.

     Pharmacia,  prior to November 1, 1998,  maintained  separate 401(k) defined
     contribution  plans known as the  Retirement and Savings Plan for Employees
     of Jacob Hartz Seed Co., Inc.  ("HARTZ  PLAN"),  the Retirement and Savings
     Plan for  Employees  of  HybriTech  Seed  International,  Inc.  ("HYBRITECH
     PLAN"), and the Calgene,  Inc. Savings and Protection Plan ("CALGENE PLAN")
     for the benefit of eligible employees of certain business units.  Effective
     November 1, 1998,  the Hartz  Plan,  HybriTech  Plan and Calgene  Plan were
     merged into the Pharmacia Plan and, pursuant to such merger,  all assets of
     those plans became assets of the Pharmacia Plan effective as of November 1,
     1998 and the Pharmacia  Plan assumed the  liabilities  of those plans as of
     November 1, 1998.

     DEKALB  Genetics  Corporation  ("DEKALB"),  which  had been a wholly  owned
     subsidiary of Pharmacia,  maintained a separate 401(k) defined contribution
     plan known as the DEKALB Genetics  Corporation  Savings and Investment Plan
     ("DEKALB PLAN") for the benefit of eligible employees of DEKALB.  Effective
     January 1, 2000,  the DEKALB  Plan was frozen and such  eligible  employees
     became  eligible to  participate in the Pharmacia  Plan.  Effective July 1,
     2000, the DEKALB Plan was merged into the Pharmacia  Plan and,  pursuant to
     such merger,  all assets of the DEKALB Plan became  assets of the Pharmacia
     Plan and the Pharmacia  Plan assumed the  liabilities of the DEKALB Plan as
     of July 1, 2000.

     As of March 31, 2000, the former  Monsanto  Company merged with Pharmacia &
     Upjohn, Inc., and, pursuant to such merger, the name of the former Monsanto
     Company was changed to Pharmacia Corporation.

     Effective as of September 1, 2000,  certain of the  businesses  theretofore
     conducted  by  Pharmacia  and  the  employees  in  such   businesses   were
     transferred to the Company, which was a subsidiary of Pharmacia.

     Prior to July 1, 2001 (the  "Effective  Date"),  eligible  employees of the
     Company and its subsidiaries  participated in the Pharmacia Plan. As of the
     Effective Date, the Pharmacia Plan was split into two separate plans: (1) a
     profit  sharing plan,  with an employee  stock  ownership  plan  component,
     providing savings opportunities and retirement income to eligible employees
     of the Company and certain of its  subsidiaries,  to which were transferred
     (i) the assets of the  Pharmacia  Plan  allocable to employees  and certain
     former  employees of the Company and its  subsidiaries  and (ii) certain of
     the unallocated assets and liabilities of the employee stock ownership plan
     component of the Pharmacia Plan, and which is known as the MONSANTO SAVINGS
     AND INVESTMENT  PLAN (the "PLAN");  and (2) a profit sharing plan,  with an
     employee stock ownership plan component,  providing  savings  opportunities
     and retirement income to eligible employees of Pharmacia and certain of its
     subsidiaries   and   affiliates   (exclusive   of  the   Company   and  its
     subsidiaries), which continued to hold (i) the assets of the Pharmacia Plan
     allocable  to  employees   and  certain   former   employees  of  Pharmacia
     Corporation and certain of its  subsidiaries  and affiliates other than the
     Company  and  its  subsidiaries   and  (ii)  the  unallocated   assets  and
     liabilities of the employee stock ownership plan component of the Pharmacia
     Plan that were not transferred to the Plan, and which continued to be known
     as the Pharmacia Savings and Investment Plan (the "PHARMACIA Plan").

     Effective  as of the  Effective  Date,  employees  of the  Company  and its
     subsidiaries ceased to be eligible to continue active  participation in the
     Pharmacia Plan. The Plan was established by the Company on June 11, 2001 as
     a successor to the  Pharmacia  Plan to provide  savings  opportunities  and
     retirement  income to eligible  employees who continue  employment  with or
     become employed by the Company or certain of its subsidiaries following the
     Effective Date.

     The Plan was  amended  and  restated,  effective  as of  January 1, 2002 to
     reflect   certain   provisions  of  the  Economic  Growth  and  Tax  Relief
     Reconciliation  Act  of  2001  ("EGTRRA").  The  Plan,  as so  amended  and
     restated,  is intended as good faith  compliance  with the  requirements of
     EGTRRA and is to be construed in accordance with EGTRRA and guidance issued
     thereunder.

     Prior to  August  13,  2002  (the  "Spinoff  Date"),  the  Company  and its
     subsidiaries  were members of the controlled group of corporations  (within
     the meaning of Section 414(b) of the Code) that includes  Pharmacia.  As of
     the  Spinoff  Date,  all of the  shares  of  common  stock  of the  Company
     ("COMPANY  SHARES") held by Pharmacia were  distributed to the shareholders
     of Pharmacia as a spinoff dividend,  and the Company thereby ceased to be a
     member of the controlled group of corporations that includes Pharmacia.  As
     a result of the spinoff of the  Company  from  Pharmacia  as of the Spinoff
     Date, the shares of common stock of Pharmacia  ("PHARMACIA SHARES") held in
     the Pharmacia  Stock Fund were converted into Pharmacia  Shares and Company
     Shares  that were  received as  dividends  with  respect to such  Pharmacia
     Shares.  The  Pharmacia  Shares  and the  dividended  Company  Shares  each
     represent a portion of the value of the pre-spinoff investments of Accounts
     in the Pharmacia Stock Fund.

     In order to provide  participants  with the opportunity to continue to hold
     the same economic  investment  following the Company spinoff as before, and
     to provide enhanced investment  flexibility following the spinoff, the Plan
     has been amended, effective as of the Spinoff Date, to provide not only for
     a Company Stock Fund  (including an Employer  Company Stock Sub-Fund and an
     Employee  Company Stock  Sub-Fund) and a Chemical  Stock Fund,  but also to
     continue to provide for a Pharmacia Stock Fund.  Participants  may continue
     holding portions of their Participant  Accounts or Employer Accounts in the
     Pharmacia  Stock Fund or,  pursuant to Sections  9.5 and 9.7,  may elect to
     transfer  all or any  portion of their  Participant  Accounts  or  Employer
     Accounts  from the  Pharmacia  Stock  Fund to the  Employee  Company  Stock
     Sub-Fund of the Company Stock Fund or to any of the other  Investment Funds
     and/or Pre-Mixed Portfolios. The Pharmacia Stock Fund is provided solely to
     permit the continued  holding of Participant  Accounts or Employer Accounts
     in  the  Pharmacia  Stock  Fund  following  the  spinoff  of  the  Company.
     Accordingly, no future contributions or investment transfers may be made to
     the Pharmacia Stock Fund following the Spinoff Date.

     In order to provide  enhanced  investment  flexibility,  Section 9.5 of the
     Plan has also been  amended,  effective as of the Spinoff  Date, to provide
     that any  participant,  regardless  of age, who is fully vested in both his
     Employer  Matching  Account  and  Vacation  Account  shall be  eligible  to
     transfer  all or any portion of his  Employer  Accounts  from the  Employer
     Company Stock  Sub-Fund of the Company Stock Fund to any of the  Investment
     Funds and/or the Pre-Mixed Portfolios.

     Also as a result  of the  spinoff  of the  Company  from  Pharmacia  on the
     Spinoff Date,  the Pharmacia  Shares held in the ESOP Suspense  Account and
     ESOP  Interim  Account were  converted  into  Pharmacia  Shares and Company
     Shares  that were  received as  dividends  with  respect to such  Pharmacia
     Shares. As provided in Section 19.8(d), all of the Pharmacia Shares held in
     the ESOP Suspense  Account and the ESOP Interim  Account shall,  as soon as
     possible   following  the  Spinoff  Date  as  is  consistent  with  prudent
     investment  standards as determined by an Independent  Fiduciary  appointed
     for this  purpose,  be sold  (or  exchanged  for  Company  Shares)  and the
     proceeds of such sales shall be applied to the  purchase of Company  Shares
     which shall be held in the ESOP  Suspense  Account or ESOP Interim  Account
     until allocated among  participants'  Employer  Accounts in accordance with
     Section 19.

     The Plan is hereby  amended and restated,  effective as of the Spinoff Date
     (also referred to herein as the "RESTATEMENT DATE"), as provided herein. In
     order to facilitate Plan  record-keeping  in connection with the spinoff of
     the Company from Pharmacia as of the Spinoff Date, no investment  elections
     may be made by participants on August 14, 2002 that would involve transfers
     to or from  either the  Company  Stock Fund or the  Pharmacia  Stock  Fund.
     Except as set forth in the  preceding  sentence  or as  otherwise  provided
     herein, the provisions of this Plan, as hereby amended and restated,  shall
     be effective as of the Restatement Date.

1.2  PURPOSE.  The  Plan is  maintained  by the  Employers  to  provide  savings
     opportunities  and  supplemental  benefits  for  eligible  employees of the
     Employers. The Plan is intended to be a profit sharing plan qualified under
     Sections  401(a) and 401(k) of the Code. The Employee Stock  Ownership Plan
     ("ESOP")  component of the Plan, as set forth in Section 19, is intended to
     be a stock bonus plan that  constitutes  an employee  stock  ownership plan
     qualified under Section 4975 of the Code and Section 407(d)(6) of ERISA and
     is maintained to provide eligible  employees with an opportunity to acquire
     and  hold  long-term   investment  and  ownership   interests  in  Employer
     Securities.

1.3  PLAN  ADMINISTRATION.  The Plan is administered by a committee known as the
     Employee Benefits Plans Committee (the "PLAN  COMMITTEE")  appointed by the
     Company.  The Plan Committee shall constitute the Named Fiduciary under the
     Plan for the  purpose of  managing  and  administering  the Plan.  The Plan
     Committee   may   delegate   any  or  all  of  its   authority,   duty  and
     responsibilities  hereunder  to one or  more  other  persons  or  entities,
     including  the  Company  and its  officers,  employees  or  agents.  Such a
     delegation  shall be in  writing  and shall  specify  the  identity  of the
     delegate and the responsibilities delegated to such delegate.

1.4  FUND  COMMITTEE,  TRUST  AGREEMENT.  A  committee  known as the Pension and
     Savings Funds Investment Committee (the "FUND COMMITTEE")  appointed by the
     Company shall  constitute the Named Fiduciary under the Plan with the power
     and authority on its own behalf or through its agents to manage and control
     the assets of the Trust Fund (as defined in Section  9.1 below)  including,
     in addition to the powers and  authority  not  specifically  granted to the
     Fund Committee by the Trust  Agreement (as defined  below),  all powers and
     authority  necessary or  appropriate to the discharge of its duties as such
     Named  Fiduciary.  The Company may from time to time  appoint any person or
     corporation  of any state in the  United  States to act as an  "Independent
     Fiduciary"  with  respect to all or any  portion of the assets of the Trust
     Fund. Each such Independent Fiduciary shall have the rights, powers, duties
     and discretions as may be set forth in the instrument of  appointment.  The
     funds  accumulated  under this Plan are held and/or invested by one or more
     corporate  trustees (the  "TRUSTEE")  appointed by the Fund Committee or by
     such Trustee and one or more insurance companies  ("INSURANCE  COMPANY") or
     one or more investment managers ("INVESTMENT MANAGER") selected by the Fund
     Committee. The Trustee acts in accordance with one or more Trust Agreements
     ("TRUST AGREEMENT") which may, but need not, provide for the appointment of
     an Investment  Manager to make  investments  of this Trust Fund,  and which
     implement and form a part of this Plan.

1.5  ESTABLISHMENT,   EFFECTIVE  DATE  AND   RESTATEMENT   DATE.  The  Plan  was
     established as of June 11, 2001, as an "employee  benefit plan" (within the
     meaning of Section 3(3) of ERISA).  The contribution and benefit provisions
     of the Plan took effect as of July 1, 2001,  which  shall be the  Effective
     Date of the  Plan.  The Plan has been  amended  and  restated  as set forth
     herein effective as of August 13, 2002, which shall be the Restatement Date
     of the Plan.

1.6  ACCOUNTING  DATES. A "REGULAR  ACCOUNTING DATE" is each business day during
     which the New York Stock  Exchange is open and during which this Plan is in
     effect.  A "SPECIAL  ACCOUNTING DATE" is any date so designated by the Plan
     Committee and any Special Accounting Date occurring under Section 16.5. The
     term  "ACCOUNTING  DATE"  includes  both a  Regular  Accounting  Date and a
     Special Accounting Date.

1.7  PLAN YEAR. The Plan is  administered on the basis of the calendar year (the
     "PLAN YEAR").

1.8  EMPLOYERS.  Certain Affiliates and Subsidiaries of the Company have adopted
     the Plan as of the Effective  Date. The Company will maintain this Plan for
     the benefit of its employees  and the employees of the adopting  Affiliates
     and Subsidiaries.  With the approval of the Company, any other Affiliate or
     Subsidiary  of the  Company  may adopt this Plan on or after the  Effective
     Date in  accordance  with the  provisions  of Section  14.2.  The  Company,
     Affiliates and Subsidiaries which adopt the Plan are collectively  referred
     to as the "EMPLOYERS" and individually as the "EMPLOYER."

1.9  USE OF TERMS.  Certain terms,  as used in this Plan, are defined in Section
     20 or  elsewhere  in the Plan and where so used shall have the  meanings so
     assigned to them.

1.10 SUPPLEMENTS.  The  succeeding  provisions  of the Plan may be  modified  by
     Supplements.  Each such  Supplement  will  specify a group of  employees or
     other persons to which it applies and will supersede the provisions of this
     Plan to the extent necessary to eliminate any inconsistencies  between this
     Plan and such Supplement.

1.11 FISCAL YEAR.  The term "FISCAL  YEAR" as applied to any Employer  means the
     taxable year of that Employer for federal income tax purposes.

                                    SECTION 2
                                  PARTICIPATION
                                  --------------

2.1  ELIGIBILITY.  Each  employee of an Employer  who was a  participant  in the
     Pharmacia Plan on the day immediately preceding the Effective Date ("Former
     Pharmacia  Participant")  became a participant  in the Plan as in effect on
     and after the Effective  Date.  Each other  employee of an Employer will be
     eligible to join the Plan and become a participant  under this Plan (in the
     manner described in Section 2.3) as soon as administratively feasible after
     the  later  of the  Effective  Date or the date  when he  meets  all of the
     following requirements:

     (a)  The employee is not then  contributing to any other thrift and savings
          plan,  profit  sharing  plan or cash or deferred  plan (under  Section
          401(k) of the Code) maintained by an Employer, Affiliate or Subsidiary
          nor  are  any  of  the  Employers,  Affiliates  or  Subsidiaries  then
          contributing  to any other  non-governmental  thrift and savings plan,
          profit  sharing plan or cash or deferred plan (under Section 401(k) of
          the Code) on such employee's behalf;

     (b)  He is a member of a group of  employees to which the Plan has been and
          continues  to be extended by his  Employer or by  agreement  and whose
          terms of  employment  is (a) not governed by a  collective  bargaining
          agreement,  or (b) governed by a collective bargaining agreement which
          provides for participation in this Plan;

     (c)  He has attained age 18; and

     (d)  In the case of an  employee  classified  as a Casual  Employee  by the
          Company,  either he has  completed  1,000 Hours of Service  during the
          twelve-month  period beginning on his Employment  Commencement Date or
          he has completed 1,000 Hours of Service during a Plan Year.

     If an employee does not elect to join the Plan and become a participant  as
     of the first  date on which he is  eligible  to do so, he may join the Plan
     and become a  participant  as soon as  administratively  feasible  after he
     complies with the requirements of Section 2.3.

     Notwithstanding  the preceding  paragraphs,  a participant  who  terminates
     employment  and who is  reemployed by an Employer as a member of a group of
     employees to whom the Plan has been and  continues  to be extended  will be
     eligible to join the Plan and become a  participant  therein (in the manner
     described in Section 2.3) on the date he is reemployed by an Employer.

     For all  purposes of this Plan,  a Leased  Employee  (as defined in Section
     414(n)(2)  of the Code)  shall not be  considered  to be an  employee of an
     Employer,  Subsidiary or an Affiliate;  PROVIDED, HOWEVER, that if a Leased
     Employee  becomes a common law  employee of an Employer,  Subsidiary  or an
     Affiliate,  service  while a Leased  Employee  shall  only be  credited  as
     required by Section 414(n) of the Code.

     Notwithstanding  any other  language in this  Section 2.1, for any period a
     person is categorized  by an Employer as an independent  contractor and not
     as an  employee  of the  Employer,  such  person  shall not be  eligible to
     participate in this Plan even if such person is  retroactively  categorized
     as an employee.

2.2  SERVICE. In determining Years of Service, the following rules shall apply:

     (a)  Effective  for Plan Years  beginning  on or after  January 1, 1997,  a
          participant shall be credited with a "YEAR OF SERVICE" for each twelve
          months  in (i) the  period  beginning  on the  first  day of the month
          containing  his Employment  Commencement  Date and ending on the first
          day of the month on or after his  Separation  Date,  (ii) any Break in
          Service  beginning after December 31, 1996 that does not exceed twelve
          months,  and (iii) any period  beginning on the first day of the month
          containing the participant's Reemployment Commencement Date and ending
          on the first day of the  month on or after his  subsequent  Separation
          Date.

     (b)  A participant shall be credited with a "YEAR OF SERVICE" for each Plan
          Year before 1997 during which an employee has completed at least 1,000
          Hours of Service with the Employers or the Affiliates.  If an employee
          completed  less than 1,000 Hours of Service in any Plan Year, he shall
          be entitled to a  fractional  Year of Service for such Plan Year which
          fraction shall be determined by dividing the number of such employee's
          Hours of  Service  during  such  Plan  Year by the  number of Hours of
          Service  which are  included  in the  employee's  Standard  Work Year.
          Notwithstanding the foregoing, an employee's Years of Service for Plan
          Years  ending  prior to October 1, 1974 shall in no event be less than
          his Continuous  Service for such period  determined in accordance with
          the Pharmacia Plan as in effect prior to that date.

     (c)  An "HOUR OF SERVICE" means each hour for which an employee is directly
          or  indirectly  compensated  by, or entitled  to receive  compensation
          from, an Employer or an Affiliate,  including hours up to 501 hours in
          any Plan Year for any period  during  which he  receives  compensation
          without  rendering  services such as paid  holidays,  vacations,  sick
          leave,  disability leave,  layoff, jury duty, or leave of absence, and
          including  Hours of  Service  required  to be taken  into  account  to
          satisfy federal military service laws or regulations or to satisfy any
          other federal laws. For purposes of determining the number of Hours of
          Service to be credited to an employee,  "compensation"  shall  include
          any back pay, irrespective of mitigation of damages, either awarded to
          the employee or agreed to by an Employer or an Affiliate.

          Notwithstanding  the  foregoing,  an employee who is classified by the
          Company as a  Temporary  Employee  (other  than the  subcategories  of
          Resource  Reentry  Center  Employee  or Per  Diem  Employee)  shall be
          credited  with 190 Hours of Service for each  calendar  month in which
          such employee is directly or indirectly  compensated by an Employer or
          Affiliate for the performance of duties.

          The  computation of Hours of Service and the periods to which Hours of
          Service are to be credited  shall be  determined  in  accordance  with
          Department of Labor Regulations Sections 2530.200b-2(b), (c) and (f).

     (d)  If an employee's  employment  with all of the Employers and Affiliates
          terminates  and he is later  reemployed  without  incurring a one year
          Break in  Service,  his Years of Service  both  before his  employment
          termination  and  after  his  reemployment  shall  be  aggregated  for
          purposes of this Plan.

     (e)  Effective for Plan Years commencing on or after January 1, 1985, if an
          employee  incurs five or more  consecutive  one year Breaks in Service
          ("FIVE YEAR BREAK IN SERVICE")  and is  subsequently  reemployed by an
          Employer or an  Affiliate,  his Years of Service  after such Five Year
          Break in Service shall not be taken into account when  determining his
          Vesting Percentage  (determined in accordance with Section 10.2 or any
          applicable  Supplement)  applicable  to the  portion  of his  Employer
          Matching  Account  attributable  to his employment  prior to such Five
          Year Break in Service.  However,  such an employee's  Years of Service
          before and after his Five Year Break in  Service  shall be  aggregated
          for purposes of determining his Vesting  Percentage  applicable to the
          portion  of  his  Employer   Matching  Account   attributable  to  his
          employment subsequent to such Five Year Break in Service.

     (f)  The termination of an employee's employment with one Employer will not
          interrupt the continuity of his employment  if,  concurrently  with or
          immediately  after such  termination,  he is  employed  by one or more
          Employers or Affiliates.

     (g)  If and to the extent  the  Company so  provides,  the last  continuous
          period of an employee's service with a Predecessor Company (as defined
          below)  will be  considered  as  service  with the  Employers  if such
          employee  becomes  employed  by one or  more  of  the  Employers.  For
          purposes  of this  subparagraph,  a  "PREDECESSOR  COMPANY"  means any
          corporation or other entity the stock,  assets or business of which is
          acquired by an Employer, whether by merger, consolidation, purchase of
          assets or otherwise,  and any  predecessor  thereto  designated by the
          Company.

     (h)  A period  of  concurrent  service  with two or more  Employers  and/or
          Affiliates  will be  considered  as  employment  with only one of them
          during that period.

     (i)  Years of  Service  for a  participant  who is an  employee  or  former
          employee  employed at  Agracetus or Asgrow and who becomes an employee
          of an Employer or an Affiliate when the Employer or Affiliate acquires
          the applicable entity or location shall include service with Agracetus
          or Asgrow,  as the case may be,  prior to the purchase of the business
          by the Employer or Affiliate.

     (j)  Years of  Service  for a  participant  who is an  employee  or  former
          employee employed at Calgene,  Inc., Holden's Foundation Seeds Inc. or
          Corn States  Hybrid  Service,  Inc.  and who becomes an employee of an
          Employer or an Affiliate  when the Employer or Affiliate  acquires the
          applicable  entity  shall  include  such  participant's  service  with
          Calgene,  Inc.,  Holden's  Foundation Seeds Inc. or Corn States Hybrid
          Services, Inc., as the case may be, before January 1, 1998.

     (k)  Years of  Service  for a  participant  who is an  employee  or  former
          employee  employed at DEKALB Genetics  Corporation  ("DEKALB") and who
          became a Regular  Employee  of an Employer  or an  Affiliate  when the
          Employer or Affiliate acquired DEKALB shall include such participant's
          service with DEKALB prior to the acquisition of DEKALB by the Employer
          or  Affiliate  as  determined  under the DEKALB  Genetics  Corporation
          Savings and Investment Plan.

2.3  NOTICE OF ELIGIBILITY,  ELECTION OF PARTICIPATION.  The Plan Committee will
     notify an employee of the circumstances  under which he will be eligible to
     participate  in the Plan. An eligible  employee may become a participant in
     the Plan as of any pay period by  enrolling  in the Plan in such  manner as
     the Plan Committee may prescribe.

2.4  CHANGE IN  PARTICIPANT'S  STATUS.  If a participant  is  transferred  to an
     Affiliate that is not an Employer under the Plan or to a group of employees
     to whom the Plan has not been  extended,  he shall not be  entitled to make
     After-Tax  Contributions  or to have Before-Tax  Contributions  made on his
     behalf.  In addition,  such a participant shall retain his interests in his
     Accounts.  His Accounts shall continue to be adjusted to reflect  earnings,
     gains and losses,  and he shall have the right to receive  withdrawals from
     his Accounts as provided in Section 11.

     If a participant is transferred to a Subsidiary  that is not an Employer or
     an Affiliate, the participant shall be considered for purposes of this Plan
     to be a  participant  who has  terminated  employment  and is  entitled  to
     receive payment of his Accounts under Section 10.

     If an Employer  that is an Affiliate or a Subsidiary  ceases to be a member
     of the controlled  group of  corporations  that includes the Company within
     the meaning of Sections  414(b) and 1563(a) of the Code and ceases to be an
     Employer under the Plan, a participant who is employed by such Affiliate or
     Subsidiary  shall  be  considered  for  purposes  of  this  Plan  to  be  a
     participant who has terminated  employment and shall be entitled to receive
     payment of his Accounts under Section 10.

2.5  RESTRICTED  PARTICIPATION.  A participant  shall be a participant under the
     Plan until his entire vested  Accounts are  distributed.  A participant who
     has terminated  employment with all Employers,  Affiliates and Subsidiaries
     shall not receive a share of Employer Matching Contributions for any period
     beginning  after his  termination of employment  nor, except as provided in
     Section 3.5,  shall any other deposit or transfer of monies be accepted for
     his  account  after his  termination  of  employment.  Notwithstanding  the
     foregoing,  a participant  who  terminates  employment  with all Employers,
     Affiliates and  Subsidiaries  after the end of the Plan Year but before any
     Employer Matching Contribution  described in Section 6.1(a)(ii) to which he
     may be entitled is allocated to his Employer  Matching  Account  shall have
     any such  contribution  allocated to his Employer Matching Account pursuant
     to Section 8.8.

                                   SECTION 3
                             FORM OF PARTICIPATION
                             ---------------------

3.1  PARTICIPANT  ACCOUNTS.  Each  participant  who is  employed  by an Employer
     during the Plan Year shall have the right to:

     (a)  Make Matched  Before-Tax  Contributions  and  Supplemental  Before-Tax
          Contributions  by indicating the percentage (in whole  percentages) of
          his  Eligible  Earnings  by which his salary or wages shall be reduced
          but not in  excess  of  sixteen  percent  (or  such  other  percentage
          specified in the applicable  Supplement) of his Eligible  Earnings and
          authorizing  the Employer to  contribute  such amount on behalf of the
          participant to his Before-Tax Accounts;

     (b)  Make  Matched  After-Tax   Contributions  and  Supplemental  After-Tax
          Contributions  by indicating the percentage (in whole  percentages) of
          his Eligible  Earnings to be contributed to the Plan but not in excess
          of  sixteen  percent  (or  such  other  percentage  specified  in  the
          applicable  Supplement)  of his Eligible  Earnings and credited to his
          After-Tax Accounts;

     (c)  Make both Before-Tax and After-Tax  Contributions but in the aggregate
          not in excess of sixteen percent (or such other  percentage  specified
          in the applicable Supplement) of his Eligible Earnings; or

     (d)  Make a Direct  Rollover  Contribution  according to Section 3.5, which
          shall be credited to his Direct Rollover Account.

     The contribution  election of each Former Pharmacia  Participant  under the
     Pharmacia Plan, as in effect immediately prior to the Effective Date, shall
     remain in effect as such  participant's  contribution  election  under this
     Plan on and after the  Effective  Date,  unless  and until  changed  by the
     participant in accordance with the provisions of this Plan.

3.2  EMPLOYER MATCHING CONTRIBUTION.  Each Employer shall make contributions, as
     specified herein, based on the contributions made by the Employer on behalf
     of the participant to the Matched  Before-Tax Account or by the participant
     to the Matched After-Tax  Account.  Employer  contributions  shall first be
     used to match the  Matched  After-Tax  Contributions.  Notwithstanding  the
     foregoing,  a  participant  who is  classified  as a Casual  Employee  or a
     Temporary  Employee shall receive an Employer  Matching  Contribution for a
     Plan Year only if such participant is credited with at least 1,000 Hours of
     Service during the Plan Year.

3.3  VARIATION  OF  CONTRIBUTIONS.  A  participant  may  change  his  Before-Tax
     Contributions  and  After-Tax  Contributions  rate (but not  retroactively)
     within the limits specified in this Plan (or in the applicable  Supplement)
     and in the manner  prescribed by the Plan  Committee  with the change to be
     effective  as of  the  first  day  of the  first  pay  period  as  soon  as
     administratively feasible following the participant's election.

3.4  DISCONTINUANCE  AND RESUMPTION OF CONTRIBUTIONS.  Effective as of the first
     day of the first pay period as soon as administratively  feasible following
     the participant's election, a participant may:

     (a)  Elect to discontinue making After-Tax Contributions in accordance with
          Sections  5.2 and 5.3  and/or  have his  Employer  discontinue  making
          Before-Tax  Contributions on his behalf in accordance with Section 4.2
          or 4.3; or

     (b)  Elect  to  resume  making  After-Tax  Contributions  and/or  have  his
          Employer resume making Before-Tax Contributions on his behalf.

     Such an election must be made by the participant in a manner  prescribed by
     the  Plan  Committee.  Any  such  discontinuance  shall  apply  to both the
     participant's After-Tax Contributions and Before-Tax  Contributions made on
     his  behalf  by  an  Employer   and  cannot  apply  solely  to  either  the
     participant's After-Tax  Contributions or Before-Tax  Contributions made on
     his behalf.  Any such resumption may apply to the  participant's  After-Tax
     Contributions  and/or to Before-Tax  Contributions made on his behalf by an
     Employer. A resumption of contributions may only be made if the participant
     then meets the  eligibility  requirements  of Section 2. The  participant's
     investment elections and his beneficiary  designation in effect at the time
     of  discontinuance  shall remain the same unless the participant  elects to
     change them as provided in the Plan. A participant  may elect to change his
     investment election under Section 9 during any discontinuance.

3.5  DIRECT ROLLOVER CONTRIBUTIONS. The Plan Committee may direct the Trustee to
     accept a Direct Rollover Contribution from or on behalf of:

     (a)  a participant who is employed by an Employer;

     (b)  a  participant  who retires on or after  February 1, 1994 and prior to
          March 31, 1995 while in the employ of an  Employer,  an Affiliate or a
          Subsidiary with an entitlement to receive an Employer  pension benefit
          (as  determined  under  the  terms of the  pension  plan in which  the
          participant  participates)  and who does not  receive  payment  of his
          benefits under the Plan prior to the rollover;

     (c)  a participant  who  terminates  employment  for any reason on or after
          March 31, 1995 with all Employers, Affiliates and Subsidiaries with an
          entitlement  to receive an Employer  pension  benefit  (as  determined
          under  the  terms  of  the  pension  plan  in  which  the  participant
          participates)  and who does not receive  payment of his benefits under
          the Plan prior to the rollover; or

     (d)  an employee who is eligible to participate in the Plan but who has not
          elected to start making contributions to the Plan.

     For this purpose, a "DIRECT ROLLOVER CONTRIBUTION" shall mean any cash, the
     receipt of which would constitute a direct rollover of an eligible rollover
     distribution  (excluding after-tax employee contributions) from a plan that
     is  qualified  under  Section  401(a) or 403(a)  of the  Code,  an  annuity
     contract described in Section 403(b) of the Code, an individual  retirement
     account  described in Section 408(a) of the Code, or an eligible plan under
     Section  457(b)  of the Code  which  is  maintained  by a state,  political
     subdivision  of a state,  or any  agency or  instrumentality  of a state or
     political  subdivision of a state. A Direct Rollover Contribution must meet
     the  requirements  of Section  401(a)(31)  of the Code and the  regulations
     thereunder.  Notwithstanding  the preceding,  with respect to  participants
     described in subparagraph  (a) or (d) above, the Trustee shall not accept a
     Direct  Rollover  Contribution  from a plan  maintained by an Employer,  an
     Affiliate  or a  Subsidiary.  In the  case of a  participant  described  in
     subparagraph  (b) or (c) above,  the  Trustee  shall  only  accept a Direct
     Rollover  Contribution  from a plan that is maintained  by an Employer,  an
     Affiliate or a Subsidiary.  Such amounts shall at all times be fully vested
     and  shall  be  credited,  before  January  1,  1997  to the  participant's
     Before-Tax Account, and after December 31, 1996 to the participant's Direct
     Rollover Account. Such Direct Rollover Contribution will be segregated from
     the other assets of the Plan until the date the  contribution  is accepted,
     and  thereafter  will share in the  allocation of earnings and losses under
     Section 8.6. Each participant making a Direct Rollover  Contribution to the
     Plan may elect (in whole percentages) to have such contribution invested in
     one or more of the  Investment  Funds  and/or  Pre-Mixed  Portfolios.  If a
     participant fails to make such an election,  such amounts shall be invested
     in accordance with the participant's investment election then in effect for
     his After-Tax  Contributions  and Before-Tax  Contributions,  or if no such
     investment  election is then in effect,  such amounts  shall be invested in
     the Moderate Portfolio. A Direct Rollover Contribution is not a participant
     contribution for purposes of Sections 4.8 or 7.

     The  Trustee  shall not accept a Direct  Rollover  Contribution  from (a) a
     participant who terminated  employment  with all Employers,  Affiliates and
     Subsidiaries  before  February 1, 1994,  (b) a participant  who  terminated
     employment with all Employers,  Affiliates and Subsidiaries  other than due
     to retirement on or after  February 1, 1994 and before March 31, 1995,  (c)
     an alternate payee or (d) any beneficiary (including a surviving spouse) of
     a participant.

                                   SECTION 4
                            BEFORE-TAX CONTRIBUTIONS
                            ------------------------

4.1  AUTHORIZATION OF BEFORE-TAX  CONTRIBUTIONS.  The participant may authorize,
     effective  as of  the  first  day  of the  first  pay  period  as  soon  as
     administratively   feasible   following   such   authorization,   that  the
     participant's  Eligible  Earnings  shall be reduced on a  before-tax  basis
     during  each pay  period  in an  amount  up to  sixteen  percent  (in whole
     percentages)  of his  Eligible  Earnings for that pay period (or such other
     percentage as are set forth in the applicable  Supplement  hereto) less the
     percentage of his Eligible Earnings contributed as After-Tax Contributions,
     if  any,  on  his  behalf  by  an   Employer.   This  amount   ("BEFORE-TAX
     CONTRIBUTIONS") is contributed by the Employer on behalf of the participant
     to the participant's  Before-Tax Accounts.  Such authorization must be made
     in the manner prescribed by the Plan Committee.

4.2  MATCHED BEFORE-TAX  CONTRIBUTIONS.  The amount of Before-Tax  Contributions
     elected  by the  participant  not in  excess  of seven  percent  (in  whole
     percentages)  of  the  participant's   Eligible  Earnings  (or  such  other
     percentage as specified in the applicable  Supplement) ("MATCHED BEFORE-TAX
     CONTRIBUTIONS") less the percentage of his Eligible Earnings contributed as
     Matched After-Tax Contributions, if any, on his behalf by an Employer shall
     then be  contributed  by the Employer on behalf of the  participant  to the
     participant's Matched Before-Tax Account. Notwithstanding the foregoing, no
     portion of the Before-Tax  Contributions of a participant who is classified
     as a Casual  Employee or a Temporary  Employee  shall be treated as Matched
     Before-Tax  Contributions  for a  Plan  Year  unless  such  participant  is
     credited with at least 1,000 Hours of Service during such Plan Year.

4.3  SUPPLEMENTAL BEFORE-TAX CONTRIBUTIONS.  Except as otherwise provided, if an
     Employer makes Matched Before-Tax  Contributions on behalf of a participant
     in  accordance  with  Section  4.2 for  any  pay  period  which  equal  the
     percentage  limit  on such  Matched  Before-Tax  Contributions  for any pay
     period  under  that  Section,   Before-Tax  Contributions  elected  by  the
     participant  in  excess  of  the  Matched  Before-Tax  Contribution  limits
     ("SUPPLEMENTAL BEFORE-TAX  CONTRIBUTIONS") shall then be contributed by the
     Employer on behalf of the  participant  to the  participant's  Supplemental
     Before-Tax Account.

4.4  LIMITATION ON BEFORE-TAX  CONTRIBUTIONS.  Notwithstanding the foregoing, no
     Employer may make on behalf of any participant any Before-Tax Contributions
     under the Plan for any pay  period in  excess  of the  highest  permissible
     aggregate  contribution  percentage  under  Sections 4.2 and 4.3 which will
     cause the limitations of Section 4.8, 7.2 or 7.4 to be exceeded.

4.5  ELIGIBLE  EARNINGS.  With respect to any period, a participant's  "ELIGIBLE
     EARNINGS"  shall  mean  remuneration  received  by a  participant  from  an
     Employer while an employee  eligible to  participate in the Plan.  Eligible
     Earnings shall include base compensation,  shift differential pay, overtime
     pay,  holiday pay, fire brigade pay,  military summer  encampment pay, sick
     leave pay,  strike time pay,  call-in pay, pay in lieu of base wages (which
     payments  are  to be  submitted  to  the  person  designated  by  the  Plan
     Committee), achievement awards from an achievement award program maintained
     by an  Employer,  contract  notice pay,  commissions,  sales  awards,  gain
     sharing,  annual Incentive Pay (including annual cash bonuses paid under an
     annual incentive plan established by an Employer) and lump sum amounts paid
     in lieu of wage increases.  Eligible Earnings shall also include any amount
     which  is  contributed  by  an  Employer  pursuant  to a  salary  reduction
     agreement  and  which  is  not  includible  in  the  gross  income  of  the
     participant  under Code Section 125 or 402(e)(3).  Eligible  Earnings shall
     exclude  amounts paid under any long-term  incentive plan  maintained by an
     Employer, restricted stock (and dividends payable thereon) granted pursuant
     to a management  incentive plan maintained by an Employer,  amounts paid by
     an Employer for insurance or other welfare plans or benefits,  FlexCredits,
     pay in lieu of  vacations,  compensation  attributable  to the  exercise of
     stock  options,   ad  hoc  one-time   payments,   amounts  paid  after  the
     participant's final regular paycheck, payments from the Holden's Foundation
     Seeds Inc.  Employee  Bonus Trust and any other  amounts  identified in the
     applicable  Supplement.  Overtime  pay is treated as earned in the month in
     which it is paid.  Other  previously  deferred  compensation or pay that is
     paid  during  the Plan Year  shall not be  included  in  earnings  for this
     purpose.  Pay or compensation not specifically  listed in this paragraph as
     included in Eligible Earnings shall be excluded.

     The  maximum  "Eligible  Earnings"  for any  participant  for any Plan Year
     beginning on or after January 1, 2002 shall be $200,000 (as may be adjusted
     by the  Secretary of the Treasury or his delegate for increases in the cost
     of  living  in  accordance  with  Section  401(a)(17)  of the  Code  or any
     successor provision).

4.6  DEDUCTION  OF  PARTICIPANT  CONTRIBUTIONS.  The  contributions  made  by an
     Employer on behalf of a participant in accordance with Sections 4.2 and 4.3
     shall be made at regular payroll intervals.  Contributions  agreed to by an
     Employer shall be paid to the Trustee as soon as practicable  after the end
     of the  accounting  period for which  such  contributions  were  made.  The
     Employer shall collect and withhold any Social  Security,  federal or state
     unemployment  taxes,  other  payroll taxes and any state or local income or
     earnings  taxes  imposed  on  Before-Tax  Contributions  and shall pay such
     amounts to the applicable government authorities in a timely manner.

4.7  CANCELLATION OF BEFORE-TAX CONTRIBUTIONS.  Except as otherwise provided, no
     Before-Tax  Contributions  shall be made for any pay  period  which  begins
     after a  participant  fails to  satisfy  the  eligibility  requirements  of
     Section  2  of  the  Plan  or  after  such  participant's   termination  of
     employment.

4.8  LIMITATION  ON  BEFORE-TAX  CONTRIBUTIONS.  Except to the extent  permitted
     under  Section 7.6 and Section  414(v) of the Code,  if  applicable,  in no
     event  shall a  participant's  Before-Tax  Contributions  for any Plan Year
     exceed the Elective Deferral Limitation. The "Elective Deferral Limitation"
     is: (1) for the Plan Year commencing January 1, 2002, $11,000;  (2) for the
     Plan  Year  commencing  January  1,  2003,  $12,000;  (3) for the Plan Year
     commencing  January  1,  2004,  $13,000;  (4) for the Plan Year  commencing
     January 1, 2005, $14,000; and (5) for the Plan Years commencing on or after
     January 1, 2006,  $15,000 or such increased  amount as may be determined by
     the  Secretary of the Treasury or his delegate in  accordance  with Section
     402(g)(4)  of the Code.  Any  Before-Tax  Contributions  which  exceed  the
     Elective  Deferral   Limitation  shall  be   recharacterized  as  After-Tax
     Contributions.

     If the sum of a participant's  Before-Tax  Contributions and other elective
     deferrals  (as  defined  in  Section  402(g)(3)  of  the  Code)  in a  plan
     maintained  by another  employer for any calendar  year exceed the Elective
     Deferral  Limitation,  then the  participant may file an election form with
     the Plan  Committee  designating  in  writing  the  amount  of such  excess
     Before-Tax  Contributions  to be  distributed  from  this  Plan.  Any  such
     election  form must be filed with the Plan  Committee no later than March 1
     following  the close of such  calendar  year.  If such an election  form is
     timely filed, the Trustee shall distribute to the participant the amount of
     such excess Before-Tax Contributions which the participant has allocated to
     this Plan,  adjusted for any income or loss allocable to such amount, on or
     before April 15 following the close of such calendar  year. For purposes of
     the preceding sentence,  the income or loss allocable to such excess amount
     shall be the  income  or loss  allocable  to the  participant's  Before-Tax
     Contributions for the taxable year multiplied by a fraction,  the numerator
     of which is such participant's excess Before-Tax Contributions for the year
     and the  denominator  of which  is the  participant's  Before-Tax  Accounts
     without regard to any income or loss occurring during such taxable year.

                                   SECTION 5
                             AFTER-TAX CONTRIBUTIONS
                             ------------------------

5.1  AUTHORIZATION  OF  AFTER-TAX   CONTRIBUTIONS.   A  participant  may  elect,
     effective as of the first pay period beginning as soon as  administratively
     feasible after such election, to make "AFTER-TAX CONTRIBUTIONS" during such
     pay  period  in an  amount  equal  to  up  to  sixteen  percent  (in  whole
     percentages)  of his  Eligible  Earnings for that pay period (or such other
     percentage set forth in the applicable  Supplement  hereto).  Such election
     must be made in the manner  prescribed by the Plan  Committee.  In no event
     shall  the  percentage  of  Eligible  Earnings  contributed  as  Before-Tax
     Contributions and After-Tax  Contributions  exceed sixteen percent (or such
     other percentage set forth in the applicable Supplement hereto).

5.2  MATCHED AFTER-TAX CONTRIBUTIONS. Except as otherwise expressly provided and
     effective  as of  the  first  day  of the  first  pay  period  as  soon  as
     administratively  feasible,  a participant,  if he so desires, may elect to
     make After-Tax  Contributions  under the Plan in an amount not in excess of
     seven  percent (in whole  percentages)  of his  Eligible  Earnings (or such
     other  percentage  as are set forth in the  applicable  Supplement  hereto)
     ("MATCHED AFTER-TAX  CONTRIBUTIONS").  Such amounts shall be contributed to
     the participant's Matched After-Tax Account. Notwithstanding the foregoing,
     no  portion  of  the  After-Tax  Contributions  of  a  participant  who  is
     classified as a Casual Employee or a Temporary Employee shall be treated as
     Matched After-Tax  Contributions for a Plan Year unless such participant is
     credited with at least 1,000 Hours of Service during the Plan Year.

5.3  SUPPLEMENTAL  AFTER-TAX  CONTRIBUTIONS.  Except as  otherwise  specifically
     provided,  if  a  participant  makes  Matched  After-Tax  Contributions  in
     accordance  with Section 5.2 for any pay period which equal the  percentage
     limit on such  Matched  After-Tax  Contributions  for such pay period under
     that Section, any After-Tax Contributions made by the participant in excess
     of the  Matched  After-Tax  Contribution  limits  ("SUPPLEMENTAL  AFTER-TAX
     CONTRIBUTIONS") shall then be contributed to the participant's Supplemental
     After-Tax Contributions Account.

5.4  LIMITATION ON AFTER-TAX  CONTRIBUTIONS.  Notwithstanding the foregoing,  no
     participant may make contributions in accordance with Sections 5.1, 5.2 and
     5.3 for any pay  period  in  excess of the  highest  permissible  aggregate
     contributions  percentage  under  Sections 5.2 and 5.3 which will cause the
     limitations of either Sections 7.2 or 7.5 to be exceeded.

5.5  DEDUCTION OF PARTICIPANT AFTER-TAX CONTRIBUTIONS. A participant's After-Tax
     Contributions in accordance with Sections 5.1, 5.2 and 5.3 shall be made by
     regular payroll deductions. Participant After-Tax Contributions deducted by
     an Employer which are to be paid to the Trustee will be paid to the Trustee
     as soon as practicable after the end of the period for which such After-Tax
     Contributions were made.

5.6  CESSATION OF AFTER-TAX  CONTRIBUTIONS.  Except as  otherwise  provided,  no
     participant  After-Tax  Contributions  will be  accepted  on  behalf of any
     participant for any pay period which begins after such participant fails to
     satisfy the eligibility requirements of Section 2 of the Plan or after such
     participant's termination of employment.

                                   SECTION 6
                             EMPLOYER CONTRIBUTIONS
                             ----------------------

6.1  EMPLOYER MATCHING CONTRIBUTIONS.

     (a)  The Employers  shall establish an Employer  Matching  Account for each
          participant on whose behalf it makes Matching Contributions. Except as
          otherwise  provided in this Section or Section 19, each  Employer will
          make:

          (i)  Employer  Matching  Contributions  in an  amount  equal  to sixty
               percent  (or such other  percentage  set forth in the  applicable
               Supplement   hereto)   of  the   aggregate   Matched   Before-Tax
               Contributions  and  Matched  After-Tax   Contributions  for  each
               payroll  period  deducted on behalf of  participants  employed by
               such Employer during such payroll  period,  reduced by the amount
               of Forfeitures,  if any,  applied  pursuant to Section 10.3(c) to
               satisfy  the  Employer's  obligation  to make  Employer  Matching
               Contributions described in this Section 6.1(a)(i).

          (ii) Employer Matching Contributions on behalf of participants who are
               employed  by an  Employer  on the last day of the Plan Year in an
               amount  equal  to  the  percentage  as  determined  by  the  Plan
               Committee in its sole discretion ("DISCRETIONARY  PERCENTAGE") of
               the Discretionary  Matched Contributions of such participants for
               such Plan Year,  reduced by the  amount of  Forfeitures,  if any,
               applied  pursuant to Section  10.3(c) to satisfy  the  Employer's
               obligation to make Employer Matching  Contributions  described in
               this Section 6.1(a)(ii). For purposes of this Section 6.1(a)(ii),
               "DISCRETIONARY  MATCHED  CONTRIBUTIONS"  shall mean the aggregate
               amount of Before-Tax  Contributions  and After-Tax  Contributions
               for a  Plan  Year  deducted  on  behalf  of a  participant  by an
               Employer  during such Plan Year  (including,  with respect to the
               Plan Year ending December 31, 2001, before-tax  contributions and
               after-tax contributions made to the Pharmacia Plan for the period
               commencing January 1, 2001 and ending on the Effective Date), but
               not in  excess  of ten  percent  (or  such  other  percentage  as
               determined by the Plan Committee in its sole  discretion) of such
               participant's  Eligible  Earnings for such Plan Year  (including,
               with respect to the Plan Year ending December 31, 2001,  eligible
               earnings  taken into  account  under the  Pharmacia  Plan for the
               period  commencing on January 1, 2001 and ending on the Effective
               Date).

          Notwithstanding  the foregoing,  a participant  who is classified as a
          Casual  Employee  or  a  Temporary  Employee  shall  receive  Employer
          Matching  Contributions  for a Plan Year only if such  participant  is
          credited  with not less than 1,000  Hours of  Service  during the Plan
          Year.

     (b)  Except as  provided in Section 19,  contributions  made in  accordance
          with this Section  shall be made only from the  Employer's  net income
          (i.e., its net profits before state and federal income taxes),  or its
          accumulated  profits  (i.e.,  its net profit  after  federal and state
          income taxes have been  deducted,  which have been  accumulated in the
          business) or both. If any Employer does not have sufficient net income
          and  accumulated  profits to permit it to make its  Employer  Matching
          Contributions,  then one or more of the other Employers, as determined
          by the Company,  may make  contributions on behalf of such Employer in
          an amount  not  exceeding  the  amount  of  contributions  which  such
          Employer  would  have  otherwise  contributed.   Except  as  otherwise
          provided in Section 19, (i) subject to the next following clause (ii),
          the Employer Matching Contributions described in Section 6.1(a)(i) for
          any payroll  period  shall be paid to the Trustee as soon as practical
          after the payroll period for which such  contributions  are made, (ii)
          the Employer Matching Contributions described in Section 6.1(a)(i) for
          any Plan Year for a participant  classified as a Casual  Employee or a
          Temporary  Employee who is credited  with not less than 1,000 Hours of
          Service during such Plan Year, shall be paid to the Trustee as soon as
          practical  after  such Plan  Year,  and (iii)  the  Employer  Matching
          Contributions  described in Section  6.1(a)(ii) for any Plan Year, and
          the  Vacation  Contribution  for any Plan  Year,  shall be paid to the
          Trustee no later  than the time  required  for  filing the  Employer's
          federal income tax return for that year, including extensions thereof.
          Each Employer's total contributions for any Plan Year shall be paid to
          the Trustee no later than the time required for filing the  Employer's
          federal income tax return for that year, including extensions thereof.

6.2  VACATION  CONTRIBUTIONS.  Each Employer shall establish a Vacation  Account
     for  each  participant  on whose  behalf  it made a  Vacation  Contribution
     pursuant to the terms of the Pharmacia Plan prior to the Effective Date.

6.3  CORRECTING   CONTRIBUTION.   In  addition  to  the  Employer  Contributions
     described in Sections 6.1 and 6.2, the Employers  may make such  additional
     contributions  to the Plan as may be  necessary to correct any error by the
     Company which occurs in the administration of the Plan. Any such correcting
     contribution  which relates to correction of an investment  loss occasioned
     by the Company's  administration  of the accounts  under the Plan shall not
     constitute  an Annual  Addition  to the Plan under  Section  7.3 hereof and
     shall not be an Employer  Contribution.  Any such  correcting  contribution
     which  relates to errors made by the Company in crediting the proper amount
     of  Employer  Contributions  to a  participant's  account for any Plan Year
     shall be an Employer  Contribution  and shall constitute an Annual Addition
     for the Plan Year to which such correcting  contribution  relates and which
     may  be  a  Plan  Year  other  than  the  year  in  which  such  correcting
     contribution is made.

                                   SECTION 7
                          LIMITATIONS ON CONTRIBUTIONS
                          ----------------------------

7.1  LIMITATION ON EMPLOYER CONTRIBUTIONS.  Notwithstanding anything in Sections
     6.1 and 6.2 to the contrary,  no Employer during its Fiscal Year shall make
     Employer  Contributions  in an amount in excess of the amount which will be
     deductible by the Employer under Section 404 of the Code.

7.2  LIMITATIONS ON CONTRIBUTIONS.  Except to the extent permitted under Section
     7.6 and  Section  414(v)  of the Code,  if  applicable,  the  total  Annual
     Additions (as defined in Section 7.3(a)) to a participant's  Accounts under
     this Plan and to a participant's accounts in any other Defined Contribution
     Plan in which he is a participant and which is maintained by an Employer or
     any member of the Extended Group shall not exceed the lesser of:

     (a)  The amount specified in Section  415(c)(1)(A) of the Code as in effect
          on the last day of the Plan Year; or

     (b)  One hundred percent of the  participant's  compensation (as defined in
          Section 415(c)(3) of the Code) for such Plan Year.

     In applying the limit in the preceding  sentence,  the Annual Addition to a
     participant's  accounts  under this Plan will be limited  before the Annual
     Addition to his accounts under a related Defined Contribution Plan, if any,
     is limited. The requirements of Section 415 of the Code and the regulations
     promulgated thereunder are hereby incorporated by reference.

     Reduction  of benefits or  contributions  to all plans,  where  required to
     comply with this Section,  shall be accomplished by reducing  contributions
     or allocating excess forfeitures for Defined Contribution Plans (as defined
     in Section 7.3(c)) in which the participant participated, such reduction to
     be made first with  respect to the  Defined  Contribution  Plan in which he
     most recently  accrued benefits and thereafter in such priority as shall be
     established by the Plan Committee and the plan  administrator of such other
     Defined Contribution Plans;  PROVIDED,  HOWEVER,  that necessary reductions
     may be made in a different manner and priority pursuant to the agreement of
     the Plan Committee and the plan  administrator  of all other plans covering
     such participant.

     Notwithstanding  anything herein to the contrary,  if, pursuant to the ESOP
     component  of this Plan,  the Plan  enters into an ESOP Loan (as defined in
     Section  19.3(e)),  the  amounts  contributed  to the Plan that are used to
     retire  the ESOP Loan will be treated  as Annual  Additions  subject to the
     last paragraph of this Section 7.2. Amounts released from the ESOP Suspense
     Account  (as  defined  in  Section  19.3(g))  which  are  allocated  to the
     participants'  accounts shall not constitute  Annual Additions for purposes
     of this Section.

     Also for  purposes  of this  Section  7.2,  during  any Plan  Year in which
     allocations are made pursuant to Section 19.6, the following two provisions
     will apply if no more than  one-third  of the Employer  contributions  made
     pursuant to Section 19 are allocated to Highly Compensated Employees:

     (c)  forfeitures  of  Employer  Securities  that are  Financed  Shares  (as
          defined in Section 19.3(h)) shall not constitute Annual Additions, and

     (d)  Employer contributions that are applied to interest payable on an ESOP
          Loan shall not constitute Annual Additions.

7.3  DEFINITIONS. For purposes of this Section 7, the following terms shall have
     the following meanings:

     (a)  "Annual Addition" means, with respect to any participant, for any Plan
          Year, the sum of the following amounts:

          (i)  The Employers'  contributions credited to his accounts under this
               Plan (including  Before-Tax  Contributions made by an Employer on
               behalf  of  the   participant)   and  under  a  related   Defined
               Contribution Plan, if any, for such Plan Year; and

          (ii) Any  forfeitures  which  are  allocated  to  such   participant's
               accounts  under  a  related  Defined   Contribution   Plan  which
               reallocates forfeitures among participants, if any, for such Plan
               Year; and

          (iii)The amount of the  participant's  After-Tax  Contributions  under
               this Plan (excluding Before-Tax Contributions made by an Employer
               on  behalf of the  participant)  and  contributions  to a related
               Defined Contribution Plan for such Plan Year; and

          (iv) Any  amounts  allocated  to an  individual  medical  account  (as
               defined  in  Section  415(l)(2)  of the  Code)  that is part of a
               defined benefit plan maintained by an Employer or a member of the
               Extended Group; and

          (v)  Any amounts  derived  from  contributions  paid or accrued  after
               December 31, 1985, in taxable years ending after such date,  that
               are attributable to post-retirement medical benefits allocated to
               the  separate  account of a Key  Employee  (as defined in Section
               419A(d)(3) of the Code) under a welfare  benefit fund (as defined
               in  Section  419(e) of the Code)  maintained  by an  Employer  or
               member of the Extended Group.

     (b)  "Extended   Group"  means  all  Affiliates  and  Subsidiaries  of  the
          Employers. A "member of the Extended Group" means any component member
          of the Extended Group.

     (c)  "Defined  Contribution  Plans"  means  all  savings,   thrift,  profit
          sharing,  stock bonus,  employee  stock  ownership,  welfare  benefits
          funds,  or other plans of the Extended  Group which are subject to the
          requirements of Section 415 of the Code and which  constitute  defined
          contribution   plans  for  such   purpose  as  well  as  any   benefit
          attributable to After-Tax  Contributions  or Before-Tax  Contributions
          under this Plan or any related pension plan.

     (d)  "Compensation" for purposes of this Section shall mean "compensation",
          within the meaning of Section  415(c)(3) of the Code, that is actually
          paid to the  participant  during  the Plan Year.  Notwithstanding  the
          preceding,

          (i)  for purposes of Section  7.2(b),  compensation  shall include any
               amount which is contributed  by an Employer  pursuant to a salary
               reduction  agreement  and  which is not  includible  in the gross
               income of the employee  under  Sections 125,  132(f),  402(e)(3),
               402(h) or 403(b) of the Code; and

          (ii) for all other  purposes  of this  Section,  compensation  may, as
               determined  by the Plan  Committee,  include any amount  which is
               contributed  by  the  Employer  pursuant  to a  salary  reduction
               agreement and which is not  includible in the gross income of the
               employee under Sections 125, 132(f), 402(e)(3),  402(h) or 403(b)
               of the Code.

     (e)  "Contribution  Percentage"  shall  mean  the  ratio  (expressed  as  a
          percentage) of the participant's  Contribution  Percentage  Amounts to
          the  participant's  Compensation for the Plan Year (whether or not the
          employee was a participant for the entire Plan Year).

     (f)  "Contribution  Percentage  Amounts"  shall mean the sum of participant
          After-Tax Contributions, Employer Matching Contributions and Qualified
          Matching  Contributions  (to the  extent not taken  into  account  for
          purposes of the Actual Deferral  Percentage  test) made under the Plan
          on behalf of the  participant  for the Plan  Year.  Such  Contribution
          Percentage  Amounts shall not include Employer Matching  Contributions
          that are forfeited either to correct Excess Aggregate Contributions or
          because the  contributions  to which they  relate are excess  elective
          deferrals,   Excess  Before-Tax   Contributions  or  Excess  Aggregate
          Contributions.   The  Employer  may  include  Qualified   Non-elective
          Contributions in the Contribution Percentage Amounts. The Employer may
          also include participant Before-Tax  Contributions in the Contribution
          Percentage  Amounts so long as the Actual Deferral  Percentage test is
          met  before  the  Before-Tax  Contributions  are  used  in the  Actual
          Contribution  Percentage  test and  continues to be met  following the
          exclusion of those Before-Tax Contributions used.

     (g)  "Excess Aggregate  Contributions" shall mean, with respect to any Plan
          Year, the excess of (i) the aggregate Contribution  Percentage Amounts
          taken into account in  computing  the  numerator  of the  Contribution
          Percentage actually made on behalf of Highly Compensated Employees for
          such Plan Year, over (ii) the maximum Contribution  Percentage Amounts
          permitted  by the Actual  Contribution  Percentage  test.  Each Highly
          Compensated  Employee's portion of the Excess Aggregate  Contributions
          for a Plan Year shall be determined  under a two step process.  First,
          the Excess Aggregate Contributions shall be calculated.  This shall be
          done by reducing the Contribution  Percentage  Amounts of those Highly
          Compensated Employees with the highest Actual Contribution percentages
          to the extent necessary but not below the next highest level of Actual
          Contribution  percentages.  This  process  shall be  repeated,  to the
          extent  necessary,  until the Actual  Contribution  Percentage for the
          group of Highly  Compensated  Employees  satisfies  one of the  Actual
          Contribution  Percentage  nondiscrimination tests set forth in Section
          401(m)(2) of the Code. Second, the Excess Aggregate Contributions will
          be allocated to those Highly  Compensated  Employees  with the highest
          Contribution Percentage Amounts to the extent necessary, but not below
          the  next  highest  level of  Contribution  Percentage  Amounts.  This
          process shall be repeated,  to the extent necessary,  until all Excess
          Aggregate   Contributions   have  been  allocated   among  the  Highly
          Compensated  Employees.  Such determination  shall be made after first
          determining  Excess Before-Tax  Contributions  pursuant to Section 4.8
          and then  determining  Excess  Before-Tax  Contributions  pursuant  to
          Section 7.3(h).

     (h)  "Excess Before-Tax Contributions" shall mean, with respect to any Plan
          Year,   the  excess  of  (i)  the   aggregate   amount  of  Before-Tax
          Contributions and any Qualified  Non-elective  Contributions  actually
          taken into  account in computing  the Actual  Deferral  Percentage  of
          Highly Compensated Employees for such Plan Year, over (ii) the maximum
          amount  of  such  contributions   permitted  by  the  Actual  Deferral
          Percentage  test. Each Highly  Compensated  Employee's  portion of the
          Excess  Before-Tax  Contributions  for a Plan Year shall be determined
          under a two step process.  First, the Excess Before-Tax  Contributions
          shall be  calculated.  This shall be done by reducing  the  Before-Tax
          Contributions of those Highly  Compensated  Employees with the highest
          Actual Deferral  percentages to the extent necessary but not below the
          next highest level of Actual Deferral percentages.  This process shall
          be  repeated,  to the  extent  necessary,  until the  Actual  Deferral
          Percentage for the group of Highly Compensated Employees satisfies one
          of the Actual Deferral Percentage nondiscrimination tests set forth in
          Section 401(k)(3) of the Code.  Second, the aggregate amount of Excess
          Before-Tax  Contributions  will be allocated to the Highly Compensated
          Employees  with the highest  Before-Tax  Contributions  and  Qualified
          Non-elective  Contributions to the extent necessary, but not below the
          next  highest   level  of  Before-Tax   Contributions   and  Qualified
          Non-elective  Contributions.  This process  shall be repeated,  to the
          extent   necessary,   until  the  total  aggregate  amount  of  Excess
          Before-Tax   Contributions   have  been  allocated  among  the  Highly
          Compensated Employees.

     (i)  "Highly  Compensated  Employee"  includes  highly  compensated  active
          employees and highly compensated  former employees.  Effective January
          1, 1997, highly  compensated active employee includes any employee who
          performs  service for the Employer during the  determination  year and
          who: (i) during the  look-back  year  received  compensation  from the
          Employer in excess of $80,000 (as adjusted  pursuant to Section 415(d)
          of the Code);  or (ii) is a 5% owner at any time during the  look-back
          year or determination year.

          For this purpose,  the determination  year shall be the Plan Year. The
          look-back year shall be the twelve-month period immediately  preceding
          the determination year.

          The determination of who is a Highly Compensated Employee will be made
          in  accordance  with  Section  414(q) of the Code and the  regulations
          thereunder.

     (j)  "Qualified Matching  Contributions" shall mean matching  contributions
          which  are   subject  to  the   distribution   and   nonforfeitability
          requirements of Section 401(k) of the Code when made.

     (k)  "Qualified Non-elective Contributions" shall mean contributions (other
          than Employer Contributions or Qualified Matching  Contributions) made
          by the  Employer  and  allocated to  participants'  accounts  that the
          participants  may not elect to receive in cash until  distributed from
          the  Plan;   that  are   nonforfeitable   when  made;   and  that  are
          distributable only in accordance with the distribution provisions that
          are  applicable to  Before-Tax  Contributions  and Qualified  Matching
          Contributions.

7.4  ACTUAL DEFERRAL PERCENTAGE TEST.  Notwithstanding  anything in Section 4 to
     the contrary, for each Plan Year the Plan shall satisfy the Actual Deferral
     Percentage  nondiscrimination  tests in  Section  401(k)(3)  of the Code in
     accordance with Treas.  Regs. Section  1.401(k)-1(b),  which provisions are
     hereby  incorporated  by reference.  For purposes of performing  the Actual
     Deferral  Percentage  nondiscrimination  tests for a Plan Year,  the Actual
     Deferral Percentage of Non-Highly Compensated Employees shall be determined
     as of the Plan Year for which  such  tests are  performed,  unless the Plan
     Committee elects to determine such Actual Deferral Percentage of Non-Highly
     Compensated  Employees as of the  preceding  Plan Year.  Any such  election
     shall not be changed  except as provided by the  Secretary of the Treasury.
     The Plan  Committee  may,  to the extent  necessary  to satisfy the Section
     401(k)(3)  nondiscrimination tests use the distribution method,  additional
     contributions  method,  the  recharacterization  method or a combination of
     these methods, to avoid or correct excess contributions.

     (a)  DISTRIBUTION METHOD. Notwithstanding any other provision of this Plan,
          if the Plan Committee uses the distribution method,  Excess Before-Tax
          Contributions,  adjusted  for any income and loss  allocable  thereto,
          shall be  distributed  no later than the last day of each Plan Year to
          participants whose accounts such Excess Before-Tax  Contributions were
          allocated  for the  preceding  Plan Year.  If such excess  amounts are
          distributed more than 2-1/2 months after the last day of the Plan Year
          in which such excess  amounts  arose, a ten percent excise tax will be
          imposed on the  Employers  maintaining  the Plan with  respect to such
          amounts.  Such  distributions  shall  be  made to  Highly  Compensated
          Employees  on the  basis  of the  respective  portions  of the  Excess
          Before-Tax Contributions attributable to each such employee.

          Excess    Before-Tax     Contributions    (including    the    amounts
          recharacterized) shall be treated as Annual Additions.

          Determination of Income or Loss: Excess Before-Tax Contributions shall
          be adjusted for any income and loss allocable thereto.  The income and
          loss allocable to Excess  Before-Tax  Contributions  is the income and
          loss allocable to the  participant's  Before-Tax  Account for the Plan
          Year  multiplied  by a  fraction,  the  numerator  of  which  is  such
          participant's  Excess  Before-Tax  Contributions  for the year and the
          denominator of which is the participant's account balance attributable
          to Before-Tax Contributions (and Qualified Non-elective  Contributions
          or  Qualified  Matching  Contributions,   or  both,  if  any  of  such
          contributions  are included in the Actual  Deferral  Percentage  test)
          without regard to any income and loss occurring during such Plan Year.

          Accounting  for Excess  Before-Tax  Contributions:  Excess  Before-Tax
          Contributions  shall be distributed from the participant's  Before-Tax
          Account in proportion to the  participant's  Before-Tax  Contributions
          for the Plan Year.

     (b)  ADDITIONAL  CONTRIBUTIONS  METHOD.  In  lieu  of  distributing  Excess
          Before-Tax  Contributions,  the  Plan  Committee  may  elect  to  make
          Qualified    Non-elective    Contributions   or   Qualified   Matching
          Contributions on behalf of non-highly  compensated  participants  that
          are  sufficient  to  satisfy  the  Actual  Deferral  Percentage  test,
          pursuant to Treas. Reg. Section 1.401(k)-1(b)(5).

     (c)  RECHARACTERIZATION  METHOD. In lieu of distributing  Excess Before-Tax
          Contributions or making additional  contributions,  the Plan Committee
          may treat a participant's Excess Before-Tax Contributions as an amount
          distributed to the participant and then contributed by the participant
          to the Plan.  Recharacterized  amounts will remain  nonforfeitable and
          subject  to  the  same   distribution   requirements   as   Before-Tax
          Contributions.  Amounts  may not be  recharacterized  on  behalf  of a
          Highly  Compensated  Employee  to  the  extent  that  such  amount  in
          combination   with  other   After-Tax   Contributions   made  by  that
          participant  would exceed any stated limit under the Plan on After-Tax
          Contributions.

          Recharacterization  must occur no later than two and  one-half  months
          after the last day of the Plan Year in which  such  Excess  Before-Tax
          Contributions  arose and is deemed to occur no  earlier  than the date
          the last  Highly  Compensated  Employee  is informed in writing of the
          amount  recharacterized and the consequences thereof.  Recharacterized
          amounts will be taxable to the participant for the  participant's  tax
          year in which the participant would have received them in cash.

7.5  ACTUAL CONTRIBUTION PERCENTAGE TEST.  Notwithstanding anything in Section 5
     to the  contrary,  for each Plan Year the Plan  shall  satisfy  the  Actual
     Contribution Percentage nondiscrimination tests in Section 401(m)(2) of the
     Code  in  accordance  with  Treas.  Regs.  Section   1.401(m)-1(b),   which
     provisions are hereby incorporated by reference. For purposes of performing
     the Actual Contribution Percentage nondiscrimination tests for a Plan Year,
     the Actual  Contribution  Percentage  of Non-Highly  Compensated  Employees
     shall be determined as of the Plan Year for which such tests are performed,
     unless the Plan  Committee  elects to  determine  such Actual  Contribution
     Percentage of  Non-Highly  Compensated  Employees as of the preceding  Plan
     Year.  Any such  election  shall not be changed  except as  provided by the
     Secretary of the Treasury.  The Plan Committee may, to the extent necessary
     to satisfy the Section 401(m) nondiscrimination tests, use the distribution
     method,   the   additional   contributions   method,   the   limitation  on
     contributions  method,  or a  combination  of  these  methods,  to avoid or
     correct excess contributions.

     (a)  DISTRIBUTION METHOD.  Notwithstanding any other provision of the Plan,
          if the Plan Committee uses the distribution  method,  Excess Aggregate
          Contributions,  adjusted  for any income and loss  allocable  thereto,
          shall be forfeited, if forfeitable, or if not forfeitable, distributed
          no later than the last day of each Plan Year to  participants to whose
          accounts such Excess  Aggregate  Contributions  were allocated for the
          preceding  Plan  Year.  If such  Excess  Aggregate  Contributions  are
          distributed more than 2-1/2 months after the last day of the Plan Year
          in which such excess  amounts  arose, a ten percent excise tax will be
          imposed on the  Employer  maintaining  the Plan with  respect to those
          amounts.  Excess  Aggregate  Contributions  shall be treated as Annual
          Additions.

          Determination of Income or Loss: Excess Aggregate  Contributions shall
          be adjusted for any income and loss allocable thereto.  The income and
          loss  allocable to Excess  Aggregate  Contributions  is the income and
          loss allocable to the participant's  After-Tax  Contributions Account,
          Employer  Matching  Account,   and,  if  applicable,   recharacterized
          participant  Before-Tax  Account  for the Plan  Year  multiplied  by a
          fraction,   the  numerator  of  which  is  such  participant's  Excess
          Aggregate  Contributions  for the year and the denominator of which is
          such  participant's  account  balance(s)  attributable to Contribution
          Percentage  Amounts  without  regard to any  income or loss  occurring
          during such Plan Year.

          Forfeitures of Excess Aggregate  Contributions:  Forfeitures of Excess
          Aggregate   Contributions   will  be   applied   to  reduce   Employer
          contributions  for the  Plan  Year in  which  the  excess  arose,  but
          allocated as  described in the next  sentence to the extent the excess
          exceeds  Employer  Matching  Contributions  the  Employer  has already
          contributed  for such Plan Year. If  forfeitures  are to be allocated,
          such forfeitures will be allocated,  after all other forfeitures under
          the  Plan  to  the  Employer   Matching  Account  of  each  non-highly
          compensated participant who made Before-Tax Contributions or After-Tax
          Contributions in the ratio which each such participant's  Compensation
          for  the  Plan  Year  bears  to the  total  Compensation  of all  such
          participants for such Plan Year.

          Accounting  for  Excess  Aggregate  Contributions:   Excess  Aggregate
          Contributions shall be forfeited, if forfeitable,  or distributed on a
          pro-rata basis from the  participant's  After-Tax Account and Employer
          Matching  Account (and, if applicable,  the  participant's  Before-Tax
          Account).

     (b)  ADDITIONAL  CONTRIBUTIONS  METHOD.  In  lieu  of  distributing  Excess
          Aggregate Contributions the Plan Committee may elect to make Qualified
          Non-elective  Contributions  or Qualified  Matching  Contributions  on
          behalf of non-highly  compensated  participants that are sufficient to
          satisfy the Actual  Contribution  Percentage test,  pursuant to Treas.
          Reg. Section 1.401(m)-1(b)(5).

7.6  CATCH-UP  CONTRIBUTIONS.  Effective on and after the date on which the Plan
     Committee, in its discretion, implements this Section 7.6, each participant
     who (i) is eligible to make Before-Tax  Contributions  under the Plan, (ii)
     has  attained age 50 before the close of the Plan Year and (iii) either (A)
     is currently  contributing  an amount of Matched  Before-Tax  Contributions
     which equal or exceed the per pay period  percentage  limit on such Matched
     Before-Tax   Contributions  under  Section  4.2  or  (B)  whose  Before-Tax
     Contributions  for the Plan Year  equal or  exceed  the  Elective  Deferral
     Limitation  described in Section 4.8 for such Plan Year,  shall be eligible
     to make  catch-up  contributions  in  accordance  with,  and subject to the
     limitations  of,  Section 414(v) of the Code.  Such catch-up  contributions
     shall  not be taken  into  account  for  purposes  of  Section  4.8,  which
     implements  the  provisions of Section 402(g) of the Code, nor for purposes
     of Section 7.2, which implements the provisions of Section 415 of the Code.
     The Plan shall not be treated as  failing to satisfy  the  requirements  of
     Section 7.4  (implementing  the  requirements  of Section  401(k)(3) of the
     Code),  Section 18  (implementing  the  requirements  of Section 416 of the
     Code),  or  Section  410(b)  of the Code by  reason  of the  making of such
     catch-up contributions.

                                   SECTION 8
                                   ACCOUNTING
                                   ----------

8.1  PARTICIPANT  ACCOUNTS.  The Plan  Committee  shall  maintain the  following
     accounts set forth below in the name of each participant:

     (a)  "MATCHED   BEFORE-TAX  ACCOUNT"  to  reflect  the  Matched  Before-Tax
          Contributions  made by an  Employer on behalf of each  participant  in
          accordance   with   Section  4.2  as  well  as  the  income,   losses,
          appreciation and depreciation attributable to such contributions.

     (b)  "SUPPLEMENTAL   BEFORE-TAX   ACCOUNT"  to  reflect  the   Supplemental
          Before-Tax  Contributions  (including  Catch-Up  Contributions made in
          accordance with Section 7.6), the Qualified Non-elective Contributions
          and the Qualified Matching Contributions,  if any, made by an Employer
          on behalf of each  participant in accordance  with Section 4.3, 7.4 or
          7.5,  as well as the income,  losses,  appreciation  and  depreciation
          attributable to such contributions.

     (c)  "MATCHED   AFTER-TAX   ACCOUNT"  to  reflect  the  Matched   After-Tax
          Contributions made in accordance with Section 5.2 by a participant who
          has elected to make such contributions, as well as the income, losses,
          appreciation and depreciation attributable to such contributions.

     (d)  "SUPPLEMENTAL AFTER-TAX ACCOUNT" to reflect the Supplemental After-Tax
          Contributions  made in accordance with Section 5.3 by each participant
          who has  elected  to make such  contribution,  as well as the  income,
          losses,   appreciation   and   depreciation   attributable   to   such
          contributions.

     (e)  "DIRECT ROLLOVER ACCOUNT" to reflect the Direct Rollover Contributions
          made after  December  31,  1996 in  accordance  with  Section 3.5 by a
          participant,   as  well  as  the  income,  losses,   appreciation  and
          depreciation attributable to such contributions.

     The Matched Before-Tax Account and Supplemental Before-Tax Account shall be
     collectively  referred  to  as  the  "BEFORE-TAX   ACCOUNTS."  The  Matched
     After-Tax Account and Supplemental  After-Tax Account shall collectively be
     referred to as the "AFTER-TAX ACCOUNTS." The Before-Tax Accounts, After-Tax
     Accounts and Direct Rollover  Account shall  collectively be referred to as
     the "PARTICIPANT ACCOUNTS."

8.2  EMPLOYER ACCOUNTS. The Plan Committee shall maintain the following accounts
     in the name of each participant:

     (a)  "EMPLOYER  MATCHING  ACCOUNT"  to  reflect  his share of the  Employer
          Matching  Contributions  and the  Forfeitures  arising  under the Plan
          which are credited to such Account as a part of the Employer  Matching
          Contributions  in  accordance  with  Section 6 as well as the  income,
          losses, appreciation and depreciation attributable thereto.

     (b)  "VACATION  ACCOUNT"  to reflect  his share,  if any,  of the  Vacation
          Contribution which was credited to such Account in accordance with the
          terms of the Pharmacia Plan prior to the Effective Date as well as the
          income, losses, appreciation and depreciation attributable thereto.

     The  Employer   Matching   Account  and  the  Vacation   Account  shall  be
     collectively referred to as the "EMPLOYER ACCOUNTS."

8.3  EMPLOYEE  STOCK  ACCOUNT.  The Plan  Committee  shall maintain an "EMPLOYEE
     STOCK  ACCOUNT" in the name of each  participant  who has elected to have a
     portion of his Participant Accounts invested in the Company Stock Fund.

8.4  OTHER ACCOUNTS. The Plan Committee may also maintain such other accounts as
     it deems necessary. Unless the context indicates otherwise, references to a
     participant's  "ACCOUNTS" means the Accounts  maintained in accordance with
     Sections  8.1, 8.2 and 8.3 and all other  accounts  maintained  in his name
     under the Plan in accordance with this Section 8.4.

8.5  EMPLOYER  CONTRIBUTIONS.  The Employer Matching  Contributions and Vacation
     Contributions  shall  be paid  or  delivered  to the  Trustee  and  will be
     administered  as  provided  in the Trust  Agreement.  For  purposes of this
     Section, the Employer Matching Contributions described in Section 6.1(a)(i)
     for any payroll  period shall be  considered to be made on the pay date for
     such payroll period, and the Employer Matching  Contributions  described in
     Section  6.1(a)(ii) for any Plan Year shall be considered to be made on the
     last day of that Plan Year, regardless of when paid to the Trustee.

8.6  ADJUSTMENT OF PARTICIPANTS'  ACCOUNTS. As of each Accounting Date, the Plan
     Committee shall:

     (a)  FIRST,  credit each participant's  Accounts with his pro rata share of
          any  increase,  or charge such Accounts with his pro rata share of any
          decrease,  in the value of the "adjusted net worth" of each Investment
          Fund, Pre-Mixed Portfolio,  the Employer Company Stock Sub-Fund of the
          Company Stock Fund, the Pharmacia Stock Fund and/or the Chemical Stock
          Fund, in which such Accounts have an interest as of that date;

     (b)  NEXT,  credit  participants'  After-Tax  Contributions  that are to be
          credited as of that date in accordance with Section 8.9;

     (c)  NEXT, credit  Before-Tax  Contributions on behalf of participants that
          are to be credited as of that date in accordance with Section 8.10;

     (d)  NEXT,  allocate and credit any Employer  Contributions  (including any
          Forfeitures  applied to reduce  those  contributions)  which are to be
          credited as of that date in accordance with Section 8.8;

     (e)  NEXT,  charge to the proper  Accounts all payments,  distributions  or
          loans made since the last preceding Accounting Date that have not been
          previously charged as provided in Section 8.7; and

     (f)  FINALLY,  transfer  amounts  between the Investment  Funds,  Pre-Mixed
          Portfolios,  the Employer  Company Stock Sub-Fund of the Company Stock
          Fund, the Pharmacia  Stock Fund and the Chemical Stock Fund to reflect
          new investment elections, if any.

     The "adjusted net worth" of an Investment Fund,  Pre-Mixed  Portfolio,  the
     Employer  Company Stock  Sub-Fund of the Company Stock Fund,  the Pharmacia
     Stock Fund or the Chemical Stock Fund as of any  Accounting  Date means the
     then net worth of that Investment Fund, Pre-Mixed  Portfolio,  the Employer
     Company Stock Sub-Fund of the Company Stock Fund, the Pharmacia  Stock Fund
     or the  Chemical  Stock Fund as  determined  by the Trustee  less an amount
     equal  to  any  Employer  Contributions  and  any  participants'  After-Tax
     Contributions,  Before-Tax  Contributions  or Direct Rollover  Contribution
     deposited  in such  Investment  Fund,  Pre-Mixed  Portfolio,  the  Employer
     Company Stock Sub-Fund of the Company Stock Fund, the Pharmacia  Stock Fund
     or the  Chemical  Stock Fund which have not  previously  been  credited  to
     participants'  Accounts in  accordance  with  paragraphs  (b),  (c) and (d)
     above.  The  adjustment  of  participants'  Accounts  provided  for in this
     Section  shall be made on the  basis  of the  Trustee's  valuation  of each
     Investment  Fund,  each  Pre-Mixed  Portfolio,  the Employer  Company Stock
     Sub-Fund  of the  Company  Stock  Fund,  the  Pharmacia  Stock Fund and the
     Chemical Stock Fund on a fair market value basis.

8.7  CHARGING  PAYMENTS  AND  DISTRIBUTIONS.  As of each  Accounting  Date,  all
     payments  or  distributions  made under the Plan  since the last  preceding
     Accounting Date to, or for the benefit of, a participant or his beneficiary
     will be charged to the proper Account of such participant unless previously
     charged.

8.8  ALLOCATION OF EMPLOYER CONTRIBUTIONS AND FORFEITURES.

     (a)  As soon as  administratively  feasible following the pay date for each
          payroll  period,  all  Employer  Matching  Contributions  described in
          Section  6.1(a)(i)   (including  any  Forfeitures  applied  to  reduce
          Employer  Matching  Contributions in accordance with Section 10.3) for
          such payroll  period,  will be allocated  and credited to the Employer
          Matching Account of each participant who was employed by that Employer
          during  such  payroll  period  pro  rata,  according  to  the  Matched
          Before-Tax  Contributions and Matched After-Tax  Contributions made by
          that participant,  respectively, during that payroll period; PROVIDED,
          HOWEVER,  (i) the  amount  of  such  Employer  Matching  Contributions
          allocated  to a  participant  during a Plan Year  pursuant  to Section
          6.1(a)(i) shall not exceed sixty percent (or such other  percentage as
          set forth in the  applicable  Supplement  hereto) of seven percent (or
          such  other  percentage  as set  forth  in the  applicable  Supplement
          hereto)  of that  participant's  Eligible  Earnings  for the Plan Year
          (including,  with  respect to the Plan Year ending  December 31, 2001,
          employer matching  contributions  made to, and eligible earnings taken
          into account under,  the Pharmacia  Plan for the period  commencing on
          January  1,  2001  and  ending  on the  Effective  Date)  and (ii) the
          allocation and crediting of Employer Matching Contributions  described
          in Section  6.1(a)(i)  (including  any  Forfeitures  applied to reduce
          Employer  Matching  Contributions in accordance with Section 10.3) for
          any Plan Year for a participant  classified as a Casual  Employee or a
          Temporary  Employee who is credited  with not less than 1,000 Hours of
          Service  during  such  Plan  Year,   shall  be  effected  as  soon  as
          administratively feasible following the last day of such Plan Year.

     (b)  As soon as  administratively  feasible  following  the last day of the
          Plan Year, all Employer  Matching  Contributions  described in Section
          6.1(a)(ii)  (including  any  Forfeitures  applied  to reduce  Employer
          Matching  Contributions in accordance with Section 10.3) for that Plan
          Year will be allocated and credited to the Employer  Matching  Account
          of each  participant  who is employed by that Employer on the last day
          of the Plan  Year pro rata,  according  to the  Discretionary  Matched
          Contributions made by that participant during the Plan Year; PROVIDED,
          HOWEVER, the amount of such Employer Matching Contributions  allocated
          to a participant for a Plan Year pursuant to Section  6.1(a)(ii) shall
          not  exceed  the   Discretionary   Percentage,   multiplied   by,  the
          Discretionary Matched Contributions.

8.9  CREDITING  AFTER-TAX  CONTRIBUTIONS.  Each participant's  Matched After-Tax
     Contributions  will be credited to his Matched After-Tax Account as soon as
     administratively feasible following the pay date for the payroll period for
     which  such  contributions  were  made.  Each  participant's   Supplemental
     After-Tax  Contributions  will be  credited to his  Supplemental  After-Tax
     Account as soon as administratively feasible following the pay date for the
     payroll period for which such contributions were made.  Notwithstanding the
     foregoing,  such  contributions  shall  be  contributed  to the Plan by the
     Employers  on or before  the date such  contributions  become  plan  assets
     pursuant to regulations issued by the Department of Labor.

8.10 CREDITING BEFORE-TAX  CONTRIBUTIONS.  The Matched Before-Tax  Contributions
     made by an  Employer  on behalf of a  participant  shall be credited to his
     Matched Before-Tax Account as soon as  administratively  feasible following
     the pay date for the payroll period for which such contributions were made.
     The Supplemental Before-Tax  Contributions made by an Employer on behalf of
     a participant shall be credited to his Supplemental  Before-Tax  Account as
     soon as  administratively  feasible  following the pay date for the payroll
     period  for  which  such  contributions  were  made.   Notwithstanding  the
     foregoing,  such  contributions  shall  be  contributed  to the Plan by the
     Employers  on or before  the date such  contributions  become  plan  assets
     pursuant to regulations issued by the Department of Labor.

8.11 ALLOCATIONS  PURSUANT TO QUALIFIED DOMESTIC RELATIONS ORDER. If a Qualified
     Domestic Relations Order ("QDRO") under Section 414(p) of the Code provides
     for a distribution of a portion of a participant's Accounts to an Alternate
     Payee (as defined in Section  414(p)(8)  of the Code),  the Plan  Committee
     may, in its discretion,  make a distribution  proportionately  from each of
     the participant's  Accounts, in order to comply with the terms of the QDRO.
     The Plan Committee shall pay to the Alternate Payee the entire portion of a
     participant's  Accounts  assigned to an Alternate  Payee pursuant to a QDRO
     even though such a  distribution  would  otherwise  not be available to the
     participant  under the  terms of the Plan if the  amount  allocated  to the
     Alternate Payee does not exceed $5,000.

     If the amount  allocated to an Alternate  Payee  pursuant to a QDRO exceeds
     $5,000,  the Alternate Payee may elect not to have such amount  immediately
     distributed.  If an  Alternate  Payee  elects not to  receive an  immediate
     distribution,  such  Alternate  Payee shall be  eligible to make  elections
     under  the  Plan as if such  Alternate  Payee  were a  participant  who has
     terminated employment.  However, the surviving spouse of an Alternate Payee
     may not elect to defer  distribution until December 31 of the calendar year
     in which the Alternate Payee would have attained age 70-1/2 (or December 31
     immediately  following the calendar year in which the Alternate Payee died,
     if later).

                                   SECTION 9
                      THE TRUST FUND, THE INVESTMENT FUNDS
                               AND THE LOAN FUND
                               -----------------

9.1  THE TRUST FUND.  The "Trust Fund" includes all assets of the Plan which are
     held by the Trustee in accordance with the Plan and the Trust Agreement.

9.2  THE INVESTMENT FUNDS, THE PHARMACIA STOCK FUND AND THE CHEMICAL STOCK FUND.
     The Trust Fund shall consist of the following funds:

     (a)  The "GROWTH & INCOME EQUITY  INVESTMENT FUND" which ordinarily will be
          invested in common stocks, or other securities convertible into common
          stock,  subject to the right of the Trustee to invest such  portion of
          the  Growth  & Income  Equity  Fund in cash or  short-term  marketable
          securities as the Trustee may deem advisable from time to time;

     (b)  A "COMPANY  STOCK FUND" which shall be invested in the common stock of
          Monsanto  Company,  except as provided below, and which consists of an
          Employer   Company  Stock  Sub-Fund  and  an  Employee  Company  Stock
          Sub-Fund;

     (c)  A "FIXED  INCOME FUND" which shall be invested in a contract  with the
          Insurance Company (as described in Section 1.4) guaranteeing repayment
          of the principal of the fund and  guaranteeing a fixed annual interest
          rate thereon for a specified  future period,  or in a Bank  Investment
          Contract or other high quality securities  including,  but not limited
          to, U.S. Treasury Securities;

     (d)  A  "BALANCED  FUND"  which  shall be invested in both equity and fixed
          income  securities in such  proportion as the Fund  Committee may deem
          advisable;

     (e)  An  "INTERNATIONAL  EQUITY FUND" consisting of the commingled  fund(s)
          and/or  mutual  fund(s)  selected  by the Fund  Committee  which shall
          invest  primarily in the common stocks of companies  based outside the
          United States;

     (f)  A "U.S.  EQUITY INDEX FUND" which shall be invested in  securities  of
          each company included in the S&P 500 index in proportion to its market
          capitalization weight;

     (g)  The "GROWTH  EQUITY  FUND" which  shall be invested in  securities  of
          smaller, less-known companies in new and emerging areas of the economy
          and  companies  in  mature  and  declining  industries  that have been
          revitalized and hold a strong market position; and

     (h)  The "CHEMICAL  STOCK FUND",  effective as of September 1, 1997,  which
          shall be  invested  in the  common  stock of Solutia  Inc.;  PROVIDED,
          HOWEVER,  new amounts may not be invested in the  Chemical  Stock Fund
          after September 1, 1997 (other than amounts received in a plan to plan
          transfer from the Solutia Savings and Investment  Plan).  Any dividend
          on the common stock of Solutia  Inc.  shall be invested in the Company
          Stock Fund.

     (i)  The "PHARMACIA STOCK FUND" which shall be invested in the common stock
          of Pharmacia  Corporation;  provided,  HOWEVER, new amounts may not be
          invested  in the  Pharmacia  Stock Fund after the  Spinoff  Date.  Any
          dividend  on the  common  stock  of  Pharmacia  Corporation  shall  be
          invested  in the  Company  Stock  Fund.

     The funds described above, excluding the Chemical Stock Fund, the Pharmacia
     Stock Fund and the Employer  Company  Stock  Sub-Fund of the Company  Stock
     Fund, shall be referred to collectively as the "INVESTMENT FUNDS" and shall
     be referred to individually as the "INVESTMENT  FUND".  The Funds Committee
     may from time to time add,  suspend or terminate any  Investment  Fund, the
     Chemical Stock Fund or the Pharmacia Stock Fund.

     The Trustee,  pursuant to any discretion  given it by its Trust  Agreement,
     may  retain  all or any  portion  of any of the  Investment  Funds and on a
     temporary  or  interim  basis may  invest  any of the  Investment  Funds in
     property  other than that  specified as the primary type of investment  for
     such Investment Funds.  Pursuant to the preceding sentence,  any Investment
     Fund may be partially or entirely invested in any common or commingled fund
     maintained  by the  Trustee  which  is  invested  in  property  of the type
     specified for that Investment Fund. No stocks or obligations  issued by the
     Company, its Affiliates or its Subsidiaries shall be included in any of the
     Investment  Funds  (excluding the Company Stock Fund);  PROVIDED,  HOWEVER,
     that any  investment  of any such  Investment  Fund  through  the medium of
     commingled  funds and/or mutual funds shall not constitute an investment in
     the  stocks  or  obligations   of  the  Company,   its  Affiliates  or  its
     Subsidiaries  even though the  commingled  funds  and/or  mutual  funds may
     contain such stocks or obligations.

9.3  THE LOAN FUND.  The "LOAN FUND" is  maintained  by the Plan  Committee  and
     shall  constitute a part of the Trust Fund. The Loan Fund shall include the
     notes from each  participant to whom a loan has been made under Section 12,
     which are reflected in the "LOAN ACCOUNT" of such  participants.  As of the
     time the loan is made, the participant's other Accounts shall be debited to
     reflect the amount of the loan to the  participant in the manner  specified
     in  Section  12.10 and the  amount of such loan  shall be  credited  to the
     participant's Loan Account.  As payments of principal and interest are made
     on the loan,  the Loan  Account  shall be debited as  specified  in Section
     12.10 hereof.

9.4  INVESTMENT  ELECTIONS.  A  participant  in this  Plan may  elect  (in whole
     percentages)   to   invest   his   After-Tax   Contributions,    Before-Tax
     Contributions and his Participant Accounts in one or more of the Investment
     Funds and/or Pre-Mixed Portfolios.

     The investment  election must be made in the time and manner  prescribed by
     the Plan Committee.

     The  investment  election of each Former  Pharmacia  Participant  under the
     Pharmacia Plan, as in effect immediately prior to the Effective Date, shall
     remain in effect as such participant's  investment election under this Plan
     on  and  after  the  Effective  Date,  unless  and  until  changed  by  the
     participant in accordance with the provisions of this Plan.

     A  participant's  After-Tax  Contributions,  Before-Tax  Contributions  and
     Direct  Rollover  Contributions  shall be invested,  as soon as practicable
     after the Accounting  Date for which such  contributions  were made, in the
     Investment  Funds and/or the Pre-Mixed  Portfolios,  in accordance with the
     participant's  investment election then in effect. A participant may change
     his  investment  election  in the time and  manner  prescribed  by the Plan
     Committee.  A participant  may change his election in accordance  with this
     Section  on  any  Accounting  Date.  If a  participant  fails  to  make  an
     investment  election,  such  amounts  shall  be  invested  in the  Moderate
     Portfolio.

9.5  (a) INVESTMENT OF EMPLOYER CONTRIBUTIONS.  Except as provided in Subsection
     9.5(b) and Section 9.7, a participant's Employer Accounts shall be invested
     in the Company Stock Fund,  the Pharmacia  Stock Fund or the Chemical Stock
     Fund.

     (b)  DIVERSIFICATION ELECTION

          (i)  A Participant who either:

               (A)  is an active  employee of an Employer and is fully vested in
                    both his Employer Matching Account and Vacation Account; or

               (B)  has  terminated  employment  and  has not  received  a total
                    distribution of his vested Employer Accounts,

               shall be eligible to make a voluntary election  ("DIVERSIFICATION
               ELECTION") to transfer any portion of his Employer  Accounts from
               the Employer  Company Stock Sub-Fund of the Company Stock Fund to
               the Investment Funds and/or the Pre-Mixed Portfolios.

          (ii) An  eligible  participant's  decision  to make a  Diversification
               Election must be voluntary.  Each Diversification  Election shall
               be made in the time and manner prescribed by the Plan Committee.

          (iii)Each  Diversification  Election  shall  specify:  (A)  either the
               dollar amount or the  percentage  (in whole  percentages)  of the
               Employer Accounts invested in the Employer Company Stock Sub-Fund
               of the Company  Stock Fund to be  transferred  to the  Investment
               Funds and/or the  Pre-Mixed  Portfolios;  and (B) whether it is a
               Market Price Election or a Minimum Price Election.

          (iv) MARKET PRICE ELECTION. If the eligible participant designates the
               Diversification  Election to be a "MARKET  PRICE  ELECTION",  the
               Trustee shall transfer the selected amount on the trading day for
               which the  election is timely made by the  eligible  participant.
               The sale price shall be based on the closing  price of the common
               stock of the Company  reported on the New York Stock  Exchange on
               the date on which the shares are sold.

          (v)  MINIMUM  PRICE  ELECTION.  If  the  Diversification  Election  is
               designated by the  participant to be a "MINIMUM PRICE  ELECTION",
               it shall be  effective  on the trading day for which the election
               is timely made by the eligible participant.

               Each Minimum  Price  Election  shall  specify the minimum  market
               price of the common stock of the Company  below which the Trustee
               shall not transfer the selected amount ("MINIMUM MARKET PRICE").

               If the  closing  price of the  common  stock of the  Company,  as
               reported  on the New York Stock  Exchange  on the trading day for
               which a Minimum Price Election is timely made,  equals or exceeds
               the Minimum Market Price, the Trustee shall transfer the selected
               amount on such date. The sale price shall be based on the closing
               price of the common stock of the Company reported on the New York
               Stock Exchange on that date.

               If the  closing  price of the  common  stock of the  Company , as
               reported on the New York Stock  Exchange  for the trading day for
               which the Minimum  Price  Election is timely  made,  is below the
               Minimum Market Price, the Trustee shall not transfer the selected
               amount  and  the  participant's  Diversification  Election  shall
               expire.

          (vi) Those  participants  who are officers or directors of the Company
               for  purposes  of Section 16 of the  Securities  Exchange  Act of
               1934, as amended, shall not be eligible to make a Diversification
               Election if such an election would violate any applicable federal
               law or give  rise to  short  swing  profit  liability  under  the
               federal securities laws.

     (c)  EMPLOYER ACCOUNTS TRANSFER ELECTION.  A participant who has previously
          made a Diversification Election with respect to the Company Stock Fund
          may  elect  to have  the  Trustee  transfer  all or a  portion  of the
          participant's Employer Accounts that were diversified pursuant to such
          Diversification  Election  among the  Investment  Funds and  Pre-Mixed
          Portfolios in accordance with Section 9.7.

9.6  VOTING RIGHTS.

     (a)  COMPANY STOCK FUND.  Participants  shall be notified by the Trustee of
          meetings of the Company's shareholders in a manner satisfactory to the
          Plan  Committee.  Participants  shall  also be  furnished  with  proxy
          solicitation materials, if any, in advance of the shareholder meetings
          to which  such  materials  relate.  The  Trustee  shall  also  request
          confidential  instructions  from each such  participant  regarding the
          voting of the whole  shares of common  stock of the Company held under
          the  participant's  Accounts.  The  Trustee  shall vote such shares of
          common stock in accordance with such  instructions.  The Trustee shall
          also vote on a pro rata basis (i) shares  held under the  Accounts  of
          participants  from  whom  voting  instructions  have not  been  timely
          received  from  participants;  and (ii)  shares  in the ESOP  Suspense
          Account (as defined in Section  19.3(g)) or the ESOP  Interim  Account
          (as  defined in Section  19.3(d))  which  have not been  allocated  or
          credited to participants' accounts. The proration on each voting issue
          shall be equal to the aggregate  number of votes  attributable  to the
          shares  described in clauses (i) and (ii) of the  preceding  sentence,
          multiplied  by a  fraction,  the  numerator  of which is the number of
          votes  attributable to the allocated  shares of all  participants  who
          have provided timely  instructions to the Trustee to vote for, against
          or abstain  from voting on, as the case may be, the issue on which the
          vote is taken  and the  denominator  of which is the  total  number of
          votes  attributable to allocated  shares of all  participants who have
          provided timely  instructions to the Trustee on the issue on which the
          vote was taken.  No  participants  shall acquire  ownership of Company
          common  stock  held  by the  Trustee  unless  and  until  certificates
          therefor,  registered  in their  names  on the  stock  records  of the
          Company,  have been  delivered  to such  participants  pursuant to the
          provisions of the Plan.

     (b)  PHARMACIA STOCK FUND. Participants shall be notified by the Trustee of
          meetings of Pharmacia's  shareholders in a manner  satisfactory to the
          Plan  Committee.  Participants  shall  also be  furnished  with  proxy
          solicitation materials, if any, in advance of the shareholder meetings
          to which  such  materials  relate.  The  Trustee  shall  also  request
          confidential  instructions  from each such  participant  regarding the
          voting of the whole shares of common stock of Pharmacia held under the
          participant's  Accounts.  The Trustee shall vote such shares of common
          stock in  accordance  with such  instructions.  The Trustee shall also
          vote on a pro rata  basis  shares of common  stock of  Pharmacia  held
          under the Accounts of participants from whom voting  instructions have
          not been timely  received  from  participants.  The  proration on each
          voting  issue  shall  be  equal  to  the  aggregate  number  of  votes
          attributable  to  the  shares  described  in the  preceding  sentence,
          multiplied  by a  fraction,  the  numerator  of which is the number of
          votes attributable to the shares of all participants who have provided
          timely  instructions  to the  Trustee to vote for,  against or abstain
          from  voting  on,  as the case may be,  the issue on which the vote is
          taken  and the  denominator  of which  is the  total  number  of votes
          attributable  to the  shares  of all  participants  who have  provided
          timely  instructions to the Trustee on the issue on which the vote was
          taken. No  participants  shall acquire  ownership of Pharmacia  common
          stock  held by the  Trustee  unless and until  certificates  therefor,
          registered in their names on the stock records of Pharmacia, have been
          delivered to such participants pursuant to the provisions of the Plan.

     (c)  CHEMICAL STOCK FUND.  Participants shall be notified by the Trustee of
          meetings of the shareholders of Solutia Inc. in a manner  satisfactory
          to the Plan Committee. Participants shall also be furnished with proxy
          solicitation materials, if any, in advance of a shareholder meeting to
          which  such   materials   relate.   The  Trustee  shall  also  request
          confidential  instructions from each participant  regarding the voting
          of whole  shares  of  common  stock of  Solutia  Inc.  held  under the
          participant's  Accounts.  The Trustee shall vote such shares of common
          stock in  accordance  with such  instructions.  The Trustee shall also
          vote on a pro rata basis shares of common  stock of Solutia Inc.  held
          under the Accounts of participants for whom voting  instructions  have
          not been timely  received  from  participants.  The  proration on each
          voting  issue  shall  be  equal  to  the  aggregate  number  of  votes
          attributable  to  the  shares  described  in the  preceding  sentence,
          multiplied  by a  fraction,  the  numerator  of which is the number of
          votes attributable to the shares of all participants who have provided
          timely  instructions  to the  Trustee to vote for,  against or abstain
          from  voting  on,  as the case may be,  the issue on which the vote is
          taken  and the  denominator  of which  is the  total  number  of votes
          attributable  to the  shares  of all  participants  who have  provided
          timely  instructions to the Trustee on the issue on which the vote was
          taken. No participants  shall acquire ownership of Solutia Inc. common
          stock  held by the  Trustee  unless and until  certificates  therefor,
          registered in their names on the stock  records of Solutia Inc.,  have
          been delivered to such participants  pursuant to the provisions of the
          Plan.

9.7  TRANSFERS AMONG INVESTMENT FUNDS, PHARMACIA OR CHEMICAL STOCK FUNDS, AND/OR
     PRE-MIXED PORTFOLIOS. A participant may elect to transfer,  effective as of
     an Accounting Date for which the  participant  has made a timely  election,
     all or a  portion  of  his  Participant  Accounts,  his  Employer  Accounts
     invested in the Pharmacia  Stock Fund or the Chemical  Stock Fund,  and his
     Employer  Accounts  invested in any of the  Investment  Funds or  Pre-Mixed
     Portfolios as a result of a previous  Diversification Election with respect
     to the  Company  Stock  Fund,  among the  Investment  Funds  and  Pre-Mixed
     Portfolios.  Each transfer  election will apply pro rata to the Participant
     Accounts and Employer  Accounts that are invested in each Investment  Fund,
     Pre-Mixed  Portfolio,  Pharmacia  Stock Fund or Chemical Stock Fund that is
     the  subject of such  transfer  election.  A  participant,  beneficiary  or
     Alternate  Payee who has not received a total  distribution of his Accounts
     may make elections in accordance with this Section.

     (a)  TRANSFER  ELECTION.  The participant  shall elect such transfer in the
          time and  manner  prescribed  by the Plan  Committee.  Such a transfer
          shall be made by either (i) specifying the dollar amount or percentage
          of the amount  invested in the Pharmacia  Stock Fund,  Chemical  Stock
          Fund, an Investment  Fund or Pre-Mixed  Portfolio to be transferred to
          the  other  Investment  Funds  and/or  Pre-Mixed  Portfolios,  or (ii)
          specifying  the dollar  amount or  percentage  to be  invested in each
          Investment Fund and each Pre-Mixed Portfolio.

     (b)  MARKET OR MINIMUM PRICE ELECTION. If a transfer pursuant to clause (i)
          of Subsection  9.7(a) is elected and such transfer includes amounts in
          the Pharmacia Stock Fund,  Chemical Stock Fund and/or Employee Company
          Stock Sub-Fund of the Company Stock Fund, the  participant  shall also
          specify  whether the election for the Pharmacia  Stock Fund,  Chemical
          Stock Fund or Employee Company Stock Sub-Fund,  as the case may be, is
          a Market Price Election or a Minimum Price Election.

          (i)  MARKET PRICE ELECTION. If the participant designates the transfer
               election  to be a "MARKET  PRICE  ELECTION",  the  Trustee  shall
               transfer  the  selected  amount on the  trading day for which the
               election is timely made by the participant.  The sale price shall
               be based on the closing price of the common stock of the Company,
               Pharmacia or Solutia Inc., as the case may be, as reported on the
               New York Stock Exchange on the date on which the shares are sold.

          (ii) MINIMUM PRICE ELECTION. If the transfer election is designated by
               the  participant  to be a "MINIMUM PRICE  ELECTION",  it shall be
               effective  on the  trading  day for which the  election is timely
               made by the participant.

               Each Minimum  Price  Election  shall  specify the minimum  market
               price of the common stock of the Company,  Pharmacia,  or Solutia
               Inc.,  as the case may be,  below  which  the  Trustee  shall not
               transfer the selected amount ("MINIMUM MARKET PRICE").

               If  the  closing  price  of the  common  stock  of  the  Company,
               Pharmacia or Solutia Inc., as the case may be, as reported on the
               New York Stock  Exchange  on the  trading day for which a Minimum
               Price  Election  is timely  made,  equals or exceeds  the Minimum
               Market Price,  the Trustee shall transfer the selected  amount on
               such date.  The sale price shall be based on the closing price of
               the common stock of the Company,  Pharmacia or Solutia  Inc.,  as
               the case may be, as  reported  on the New York Stock  Exchange on
               that date.

               If  the  closing  price  of the  common  stock  of  the  Company,
               Pharmacia or Solutia Inc., as the case may be, as reported on the
               New York Stock Exchange for the trading day for which the Minimum
               Price Election is timely made, is below the Minimum Market Price,
               the  Trustee  shall not  transfer  the  selected  amount  and the
               participant's transfer election shall expire.

     (c)  TRANSFER RESTRICTIONS. In no event may amounts be transferred into (i)
          the Chemical Stock Fund after September 1, 1997, or (ii) the Pharmacia
          Stock Fund after the Spinoff Date, or (iii) the Employer Company Stock
          Sub-Fund of the Company Stock Fund.

9.8  PLAN EXPENSES.  Certain  administrative  expenses  incurred by the Plan and
     investment  expenses with respect to the  Investment  Funds  (excluding the
     Company Stock Fund) and the Pre-Mixed Portfolios may be paid from the Trust
     Fund.  Payment of any such expenses from the assets of the Trust Fund shall
     be allocated to the Accounts of each participant as described hereunder.

     (a)  ADMINISTRATIVE  EXPENSES.  The  Trustee  may  pay  the  administrative
          expenses of the Plan, unless paid with Forfeitures pursuant to Section
          10.3 or paid by the  Employers,  from the  assets of the Trust Fund in
          accordance  with  the  provisions  of the  Trust  Agreement.  Any such
          permitted  administrative  expenses  shall be allocated to and charged
          against the Accounts of each participant on a pro rata basis, based on
          a ratio,  the  numerator  of which is the amount of the  participant's
          Accounts  and the  denominator  of which is the  total  amount  of all
          Accounts of participants.

     (b)  INVESTMENT  FUND EXPENSES.  The Trustee shall pay the management  fees
          and expenses  incurred by the Investment  Funds (excluding the Company
          Stock Fund) and the Pre-Mixed Portfolios, unless paid with Forfeitures
          pursuant to Section 10.3 or paid by the Employers,  from the assets of
          the  Trust  Fund  in  accordance  with  the  provision  of  the  Trust
          Agreement.  The fees and  expenses  of each  such  Investment  Fund or
          Pre-Mixed   Portfolio  shall  be  charged  to  the  Accounts  of  each
          participant in such  Investment  Fund or Pre-Mixed  Portfolio on a pro
          rata  basis,  based  on a  ratio,  the  numerator  of  which  is  such
          participant's  balance in such Investment Fund or Pre-Mixed  Portfolio
          and the denominator of which is the total balance of all  participants
          in such Investment Fund or Pre-Mixed Portfolio.

                                   SECTION 10
                          PAYMENT OF ACCOUNT BALANCES
                          ---------------------------

10.1 PARTICIPANT  ACCOUNTS.  Each participant shall at all times be fully vested
     in the amounts credited to his Before-Tax Accounts, After-Tax Accounts, and
     Direct Rollover Account. In the event a participant  terminates employment,
     his Before-Tax  Accounts,  After-Tax  Accounts and Direct Rollover  Account
     shall become distributable to him in accordance with Sections 10.4 and 10.5
     hereof.

10.2 EMPLOYER ACCOUNTS.

     (a)  VACATION ACCOUNT.  Each participant shall at all times be fully vested
          in the amounts credited to his Vacation Account.

     (b)  Employer Matching Account.

          (i)  Retirement, Disability or Death. If a participant:

               (A)  terminates  employment  on or  after  attaining  his  Normal
                    Retirement Age;

               (B)  is  deemed to  terminate  employment  under  the  applicable
                    disability  income  plan due to  Disability  (as  defined in
                    Section 20.22); or

               (C)  dies  while in the  employ  of an  Employer,  Subsidiary  or
                    Affiliate and prior to distribution of his vested Accounts,

     his  Employer  Matching  Account  as of the date he  terminates  employment
     (after any adjustments  then required under the Plan) shall be fully vested
     and shall become  distributable to the participant or his  beneficiary,  as
     the case may be, in accordance with Sections 10.4 and 10.5.

          (ii) RESIGNATION OR DISMISSAL.  If a participant terminates employment
               with  all  the  Employers,  Affiliates  and  Subsidiaries  before
               becoming  vested  under  Section   10.2(b)(i)  or  before  he  is
               otherwise  entitled  to payment  of his  account  balances  under
               Section 2.4, the balance in his Employer  Matching  Account shall
               be reduced to an amount determined by multiplying such balance by
               the  "Vesting  Percentage"  determined  in  accordance  with  the
               following table:

        ------------------------------------  -------------------------

                  YEARS OF SERVICE               VESTING PERCENTAGE
        ------------------------------------  -------------------------

        Less than 1 year                                 0%
        ------------------------------------  -------------------------
        ------------------------------------  -------------------------

        1 year but less than 2 years                    20%
        ------------------------------------  -------------------------
        ------------------------------------  -------------------------

        2 years but less than 3 years                   40%
        ------------------------------------  -------------------------
        ------------------------------------  -------------------------

        3 years but less than 4 years                   60%
        ------------------------------------  -------------------------
        ------------------------------------  -------------------------

        4 years but less than 5 years                   80%
        ------------------------------------  -------------------------
        ------------------------------------  -------------------------

        5 years or more                               100%
        ------------------------------------  -------------------------

     Notwithstanding  the foregoing,  if a participant  who was credited with an
     Hour of Service on or after January 1, 1997 and who had three or more Years
     of  Service  on  that  date  either  (i)  terminates  employment  with  all
     Employers,  Affiliates and Subsidiaries on or after that date and before he
     becomes  fully  vested  under  Section  10.2(b)(i),  or (ii)  is  otherwise
     entitled  to payment of his  Accounts  under  Section  2.4 on or after that
     date,  his Accounts shall become fully vested and  distributable  to him in
     accordance with Sections 10.4 and 10.5.

     The amount  determined  in  accordance  with the above table  shall  become
     distributable to the participant or his beneficiary, as the case may be, at
     the time identified in Section 10.4 and in the manner  described in Section
     10.5.

     Notwithstanding the foregoing,  each Former Pharmacia Participant who was a
     participant  in  the  Pharmacia  Plan  and  was  employed  by an  Employer,
     Affiliate or  Subsidiary  on March 31,  2000,  shall be fully vested in his
     Accounts.

     Notwithstanding  the  foregoing,  a  participant  who  is  employed  by  an
     Employer,  Affiliate or Subsidiary when a Change of Control occurs shall be
     fully vested in all of his Accounts as of the date of the Change of Control
     and any allocation to his Accounts after the Change of Control.

     Notwithstanding the foregoing, a participant whose employment is terminated
     as the result of:

          o    a shutdown of business operations; or

          o    either the  disposition of  substantially  all the assets (within
               the meaning of Section  409(d)(2) of the Code) used in a trade or
               business of an Employer, or the disposition of the interest in an
               Affiliate or Subsidiary  (within the meaning of Section 409(d)(3)
               of the Code),

     shall  become  fully  vested  in all  his  Accounts  as of  his  employment
     termination date.

10.3 FORFEITURES.

     (a)  If a  participant  is less than 100% vested in his  Employer  Matching
          Accounts when he terminates employment with all Employers,  Affiliates
          and Subsidiaries,  the non-vested portion of such account shall become
          a "FORFEITURE" on the earlier of the date the participant incurs a one
          year  Break  in  Service  or  the  date  the  participant  receives  a
          distribution of his vested  Employer  Matching  Accounts.  Forfeitures
          shall be applied pursuant to the terms of paragraph (c).

     (b)  A former participant  covered under paragraph (a) who is reemployed by
          an Employer or an Affiliate prior to sustaining  five  consecutive one
          year Breaks in Service shall have the portion of his Employer Matching
          Accounts that was forfeited  reinstated,  unadjusted  for any gains or
          losses after the amounts became a Forfeiture.  Forfeitures  reinstated
          under this  paragraph  shall come from  Forfeitures  that have yet not
          been  applied  according  to  paragraph  (c) and,  to the extent  such
          Forfeitures are insufficient,  from Employer  contributions.  When the
          participant  subsequently terminates employment,  he shall be entitled
          to  receive  an  amount  equal  to his  Participant  Accounts  and his
          Vacation Account plus--

          (i)  The sum of his  Employer  Matching  Accounts  at the  time of the
               subsequent  termination of employment PLUS the amount distributed
               to him from such account at the time of his prior  termination of
               employment,

          (ii) Multiplied  by  his  Vesting   Percentage  at  the  time  of  his
               subsequent termination of employment,

          (iii)Minus the amount previously  distributed to him from his Employer
               Accounts due to his prior termination of employment.

     (c)  In the Plan  Committee's  (or its  duly  authorized  delegate's)  sole
          discretion, Forfeitures may be applied to: reinstate Forfeitures under
          paragraph (b) or (d), reduce Employer Contributions,  reduce Qualified
          Non-elective Contributions or Qualified Matching Contributions and pay
          Plan expenses described in Section 9.8.

     (d)  Subject to the foregoing  provisions of this Section, if a participant
          who has terminated employment (or his beneficiary) has not requested a
          distribution  of  his  vested  Accounts  on or  before  the  date  the
          participant  would have attained age 70-1/2 and such  participant  has
          not been located by the Company,  the  participant's  vested  Accounts
          shall become  Forfeitures.  Any such  participant (or his beneficiary)
          who  subsequently  requests a distribution  of his Accounts shall have
          his Accounts restored by the Company based upon the amounts forfeited,
          unadjusted   for  any  gains  or  losses  after  the  amounts   became
          Forfeitures.

10.4 TIMING OF DISTRIBUTIONS.

     (a)  After a participant terminates  employment,  his vested Accounts shall
          be distributed,  or payment shall begin,  as soon as  administratively
          feasible  after the  participant  files an  election,  in the form and
          manner  prescribed  by the Plan  Committee,  to begin  receiving  such
          amounts. A participant who terminates  employment with vested Accounts
          that do not  exceed  $5,000  shall  automatically  receive  a lump sum
          distribution in accordance with Section 10.5.

     (b)  Payment of benefits under the Plan to a participant shall not commence
          later  than the 60th day after the  latest of the end of the Plan Year
          during which:

          (i)  The participant attains age 65;

          (ii) The tenth anniversary of his participation in the Plan; or

          (iii)His  employment  terminates  with all  Employers,  Affiliates and
               Subsidiaries.

     (c)  Notwithstanding  anything in this  Section 10 to the  contrary,  in no
          event shall payment of benefits under the Plan commence later than the
          participant's  Required  Beginning Date. For purposes of this Section,
          "REQUIRED BEGINNING DATE" shall mean:

          (i)  with respect to a  participant  who  attained  age 70-1/2  before
               January 1, 1988 and who was not a five percent  owner (as defined
               in Section 416 of the Code),  the April 1 following  the calendar
               year in which he terminates employment;

          (ii) April 1, 1990,  with respect to a  participant  who: (a) attained
               age 70-1/2  during  1988;  (b) was not a five  percent  owner (as
               defined  in  Section  416 of the Code) and (c) did not  terminate
               employment before January 1, 1989;

          (iii)with  respect  to  any  other   participant   not   described  in
               subsection  (i) or (ii)  above who  attained  70-1/2 on or before
               December  31,  1995,  the later of (A) April 1, 1989,  or (B) the
               April 1  following  the  calendar  year in which the  participant
               attains age 70-1/2; and

          (iv) with  respect to any  participant  who  attained age 70-1/2 after
               December 31, 1995, the April 1 of the calendar year following the
               later of (A) the calendar year in which the  participant  attains
               age 70-1/2,  or (B) the  calendar  year in which the  participant
               retires,  except that  benefit  distributions  to a five  percent
               owner (as  defined in Section  416 of the Code) must  commence by
               the April 1 of the calendar  year  following the calendar year in
               which the  participant  attains age 70-1/2.  Notwithstanding  the
               foregoing,  the pre-retirement age 70-1/2  distribution option is
               only eliminated with respect to employees who reach age 70-1/2 in
               a  calendar  year  that  begins  after  December  31,  1998.  The
               pre-retirement age 70-1/2 distribution option is an optional form
               of  benefit  under  which   benefits   payable  in  a  particular
               distribution  form  (including  any  modifications  that  may  be
               elected after benefit commencement) commence at a time during the
               period that begins on or after  January 1 of the calendar year in
               which an  employee  attains  age  70-1/2  and ends April 1 of the
               immediately following calendar year.

     (d)  If the  participant  dies  after  distribution  of  his or her  vested
          Accounts  has  begun,  the  remaining  portion of such  Accounts  will
          continue to be  distributed at least as rapidly as under the method of
          distribution being used prior to the participant's death.

          If the  participant  dies  before  distribution  of his or her  vested
          Accounts  begins,  distribution  of the  participant's  entire  vested
          Accounts  shall be  completed  by  December  31 of the  calendar  year
          containing  the  fifth   anniversary  of  the   participant's   death.
          Notwithstanding  the foregoing,  if the designated  beneficiary is the
          participant's  surviving  spouse,  distributions of the  Participant's
          vested  Accounts  must  begin by the later of (1)  December  31 of the
          calendar  year  immediately  following  the calendar year in which the
          participant died and (2) December 31 of the calendar year in which the
          participant would have attained age 70-1/2.

     (e)  Section 401(a)(9) of the Code is hereby incorporated by reference, and
          distributions  under this Plan shall be made in  accordance  with such
          section and the  regulations  issued by the  Secretary of the Treasury
          interpreting such section.  Provisions reflecting Section 401(a)(9) of
          the Code shall  override  any other  distribution  options that may be
          inconsistent  with such section and this  Section.  Any  distributions
          required under the incidental  death benefit  requirements  of Section
          401(a) of the Code shall be treated as  distributions  required  under
          Section  401(a)(9)  of the Code  and this  Section.  With  respect  to
          distributions  under the Plan made for calendar years  beginning on or
          after  January 1, 2001,  the Plan will apply the minimum  distribution
          requirements  of Section  401(a)(9) of the Code in accordance with the
          regulations  under Section 401(a)(9) that were proposed on January 17,
          2001,  notwithstanding any provision of the Plan to the contrary. This
          amendment  shall continue in effect until the end of the last calendar
          year beginning  before the effective date of final  regulations  under
          Section  401(a)(9)  or such other date as may be specified in guidance
          published by the Internal Revenue Service.

10.5 DISTRIBUTION OPTIONS. A participant or his beneficiary,  as the case maybe,
     may elect to  receive  distribution  of his vested  Accounts  in one of the
     methods  described below;  provided,  however,  if the vested Accounts of a
     participant do not exceed $5,000 at the time of distribution, such Accounts
     shall automatically be distributed in a single sum.

     (a)  LUMP SUM  DISTRIBUTION.  A participant  or a beneficiary  may elect to
          receive his vested Accounts in a lump sum as soon as practicable after
          the date on which a timely  distribution  election  is made ("LUMP SUM
          DISTRIBUTION").

     (b)  INSTALLMENT  PAYOUT OPTION.  Subject to the conditions and limitations
          set  forth  below,  if the  vested  Accounts  of a  participant,  or a
          surviving  spouse  beneficiary,  exceed  $5,000,  the  participant  or
          surviving  spouse  beneficiary may direct that the value of his vested
          Accounts  be  distributed  to  him in  monthly,  quarterly  or  annual
          Calculated  Installments or Fixed Installments.  In no event, however,
          shall (i) the number of years over which  installments  are to be made
          be less than one or exceed the life  expectancy of the  participant or
          surviving spouse beneficiary on the date the installments commence (as
          determined in accordance with Table V of the regulations under Section
          72 of the  Code),  or (ii)  the  installments  begin  later  than  the
          participant's  attainment of age 70-1/2.  The participant or surviving
          spouse  beneficiary,  as the case may be, may change the  frequency of
          installment payments (monthly, quarterly, or annual) and/or the number
          of  years  over  which  installments  shall  be  made,  up to the life
          expectancy of the participant or surviving spouse beneficiary when the
          installments  are recalculated (as determined in accordance with Table
          V of  regulations  under Section 72 of the Code).  If a participant is
          reemployed  as an Employee by an  Employer or  Affiliate,  installment
          payments for such participant shall be suspended until the participant
          again  terminates   employment  with  all  Employers  and  Affiliates.
          Notwithstanding  the  foregoing,  installment  payments  shall  not be
          suspended for any participant who on January 1, 1997 was (a) receiving
          installment  payments,  (b) age 59-1/2 or over,  and (c) employed as a
          Resource Re-entry Center Employee on that date.

          "Calculated  Installments."  Payments  under this option shall be made
          over the payment  period  selected  by the  participant  or  surviving
          spouse  beneficiary.  Each installment payment under this option shall
          equal the  quotient of (i) the  participant's  vested  Accounts at the
          time of payment  (excluding any outstanding loan balances)  divided by
          (ii) the number of remaining installment payments.

          "Fixed  Installments." Under this option, the participant or surviving
          spouse  beneficiary  elects  the amount of each  installment  payment.
          Installment  payments  are then made  until his  vested  Accounts  are
          exhausted.  Each installment payment under this option shall equal the
          amount elected by the participant or surviving spouse beneficiary.

          If  a  participant  or  surviving   spouse   beneficiary   elects  the
          Installment   Payout  Option,  the  participant  or  surviving  spouse
          beneficiary   shall  continue  to  be  entitled   thereafter  to  make
          investment  elections under Sections 9.5 and 9.7. Such  participant or
          surviving spouse  beneficiary  shall not be entitled to make After-Tax
          Contributions,  to have Before-Tax Contributions made on his behalf or
          to obtain a loan under Section 12 except as provided in Section 12.15.

     (c)  COMMON STOCK OF COMPANY.  Any lump sum or partial  distribution of the
          portion of a participant's Accounts invested in the Company Stock Fund
          in accordance  with this Section  shall be made, at the  participant's
          election, in one of the following manners:

          (i)  in cash;

          (ii) in the form of the maximum  number of full shares of common stock
               of the  Company to the extent any  portion of such  participant's
               Accounts are invested in the Company  Stock Fund,  with the value
               of  any  fractional  shares  distributed  in  cash;  or

          (iii)a specified  number of full shares of common stock of the Company
               and  cash,  to the  extent  any  portion  of  such  participant's
               Accounts are invested in the Company Stock Fund.

          A participant will make a separate  election for his Accounts invested
          in the Employer  Company Stock Sub-Fund and the Employee Company Stock
          Sub-Fund of the Company Stock Fund.  Such  elections  shall be made at
          the time and in the manner specified by the Plan Committee.

          Installment distributions from the portion of a participant's Employer
          Accounts  invested  in the  Employer  Company  Stock  Sub-Fund  of the
          Company  Stock  Fund  shall be made,  at the  participant's  election,
          either:

          (i)  in the form of the maximum  number of full shares of common stock
               of the  Company to the extent any  portion of such  participant's
               Accounts are invested in the Employer  Company Stock  Sub-Fund of
               the Company Stock Fund; or

          (ii) in cash.

          Installment  distributions from the participant's Accounts invested in
          the Employee Company Stock Sub-Fund of the Company Stock Fund shall be
          made in cash.

          Notwithstanding  the  foregoing,  distributions  from a  participant's
          Employee Stock Account and Employer  Accounts shall be paid in cash if
          the participant  fails to make an election to receive such Accounts in
          common stock of the Company in accordance with this Section.

     (d)  COMMON STOCK OF PHARMACIA. Any lump sum or partial distribution of the
          portion of a  participant's  Accounts  invested in the Pharmacia Stock
          Fund  in   accordance   with  this  Section  shall  be  made,  at  the
          participant's election, in one of the following manners:

          (i)  in cash;

          (ii) in the form of the maximum  number of full shares of common stock
               of  Pharmacia  to the  extent any  portion of such  participant's
               Accounts are invested in the Pharmacia Stock Fund, with the value
               of any fractional shares distributed in cash; or

          (iii)a specified  number of full shares of common  stock of  Pharmacia
               and  cash,  to the  extent  any  portion  of  such  participant's
               Accounts are invested in the Pharmacia Stock Fund.

          Such election shall be made at the time and in the manner specified by
          the Plan Committee.

          Installment distributions from the portion of a participant's Accounts
          invested in the Pharmacia Stock Fund shall be made in cash.

          Notwithstanding  the  foregoing,  distributions  from a  participant's
          Accounts invested in the Pharmacia Stock Fund shall be paid in cash if
          the participant  fails to make an election to receive such Accounts in
          common stock of Pharmacia in accordance with this Section.

     (e)  COMMON STOCK OF SOLUTIA INC. Any lump sum or partial  distribution  of
          the portion of a participant's Accounts invested in the Chemical Stock
          Fund  in   accordance   with  this  Section  shall  be  made,  at  the
          participant's election, in one of the following manners:

          (i)  in cash;

          (ii) in the form of the maximum  number of full shares of common stock
               of Solutia  Inc. to the extent any portion of such  participant's
               Accounts are invested in the Chemical Stock Fund,  with the value
               of any fractional shares distributed in cash; or

          (iii)a specified number of full shares of common stock of Solutia Inc.
               and  cash,  to the  extent  any  portion  of  such  participant's
               Accounts are invested in the Chemical Stock Fund.

          Such election shall be made at the time and in the manner specified by
          the Plan Committee.

          Installment distributions from the portion of a participant's Accounts
          invested in the Chemical Stock Fund shall be made in cash.

          Notwithstanding  the  foregoing,  distributions  from a  participant's
          Accounts  invested in the Chemical Stock Fund shall be paid in cash if
          the participant  fails to make an election to receive such Accounts in
          common stock of Solutia Inc. in accordance with this Section.

     (f)  PARTIAL DISTRIBUTION.  Twice each Plan Year, a terminated  participant
          or  surviving  spouse  beneficiary  may  elect to  receive  a  partial
          distribution of at least $200 of his vested Accounts under the Plan. A
          partial  distribution  shall  be made  from the  participant's  vested
          Accounts  in  the  following  order:  After-Tax  Accounts,  Before-Tax
          Accounts,  Direct  Rollover  Account,  Vacation  Account and  Employer
          Matching Account.

          Notwithstanding  the  preceding,  a  participant  who is an officer or
          director of the Company for  purposes of Section 16 of the  Securities
          Exchange  Act of 1934,  as amended,  shall not be  permitted to make a
          partial  distribution if such partial  distribution  would violate any
          applicable  federal law or give rise to short swing  profit  liability
          under the federal securities laws.

     (g)  NOTICE  REGARDING  DISTRIBUTION  OPTIONS.  Each  participant  shall be
          provided  with a notice  of his right to elect a  distribution  option
          available  under this Section no less than 30 days and no more than 90
          days  before  the date as of which  distribution  to such  participant
          begins.  Notwithstanding  the foregoing,  a participant  may waive the
          requirement  that he  receive  such a notice at least 30 days prior to
          the date as of which benefits are paid; PROVIDED, that distribution of
          the participant's Accounts begins at least seven days after the notice
          is supplied.

10.6 DESIGNATION  OF  BENEFICIARIES.  Each  participant  may, from time to time,
     designate  any  person  or  persons  (who may be  designated  concurrently,
     contingently  or  successively)  to whom any benefits  payable on behalf of
     such participant are to be distributed if he dies before he receives all of
     his benefits.  Such  beneficiary  designation  shall also be effective if a
     participant   dies  after  his  termination  of  employment  but  prior  to
     distribution of all of his vested Accounts. A beneficiary designation shall
     be  effective  only  when it is  signed,  dated  and  filed  with  the Plan
     Committee  while the  participant is alive and will cancel all  beneficiary
     forms previously signed and filed by the participant.

     Effective  for  participants  who have at least one Hour of  Service  after
     August 23, 1984,  notwithstanding anything in this Plan to the contrary, in
     the event of the  participant's  death prior to  distribution of all of his
     vested  Accounts if the  participant  was married on the date of his death,
     his  beneficiary  shall be his surviving  spouse unless the participant had
     made a Qualified Election prior to his death.

     A "QUALIFIED  ELECTION"  shall mean an election made by the participant (on
     forms  provided by and filed with the Plan  Committee)  providing  that the
     surviving  spouse shall not be the sole  beneficiary  of the  participant's
     vested Accounts, and

     (i)  the spouse of the participant consents in writing to such election and
          acknowledges  the effect of such  election  on forms  provided  by and
          filed with the Plan Committee and witnessed by a notary public; or

     (ii) it is  established  that  there is no  spouse,  the  spouse  cannot be
          located,  or such  other  circumstances  exist as may be  provided  by
          regulations prescribed under the Code.

     Any Qualified  Election consented to by a spouse pursuant to this paragraph
     shall be  irrevocable  and shall be  effective  only with  respect  to such
     spouse. Any such election may be revoked but not changed by the participant
     without  consent  of the  participant's  spouse  in  accordance  with  this
     paragraph.

     Subject to the provisions  above regarding  Qualified  Elections,  a Former
     Pharmacia  Participant's  beneficiary designation under the Pharmacia Plan,
     as in effect immediately prior to the Effective Date, shall be deemed to be
     a valid  beneficiary  designation  filed with the Plan Committee under this
     Plan on and after  the  Effective  Date  unless  and until the  participant
     revokes such beneficiary designation or makes a new beneficiary designation
     under  this Plan.  The term  "DESIGNATED  BENEFICIARY"  as used in the Plan
     means the person or persons  designated by a participant as his beneficiary
     in the last effective form filed with the Plan Committee under this Section
     and to whom a deceased  participant's  benefits are payable under the Plan.
     The term  "BENEFICIARY"  as used in the Plan means the  person or  persons,
     trust(s),  estate(s), or other entity(ies) to whom a deceased participant's
     benefits are payable under this Section.

     If (i) no beneficiary has been named by a deceased  participant,  (ii) such
     designation  is not  effective  pursuant  to this  Section,  or  (iii)  the
     designated  beneficiary has predeceased the participant,  any undistributed
     benefit of the deceased  Participant shall be distributed by the Trustee at
     the direction of the Plan Committee:

     (a)  to the surviving spouse of such deceased participant, if any; or

     (b)  if there is no surviving spouse and the participant dies while covered
          under the Employer's life insurance plan, to the surviving beneficiary
          (or   beneficiaries)   specifically   designated  in  writing  by  the
          participant,  if any, to receive  life  insurance  benefits  under the
          Employer's life insurance plan in equal shares; or

     (c)  if there is no  surviving  spouse and either  the  participant  is not
          covered under the Employer's life insurance plan when he dies or there
          is no surviving  beneficiary (or  beneficiaries)  designated under the
          Employer's life insurance plan, to the participant's estate.

     The  marriage  of  a  participant   shall  revoke  any  prior   beneficiary
     designation made by him, except for any Qualified Election. A participant's
     divorce  shall be deemed to revoke  any  designation  of the  participant's
     divorced spouse that was made prior to the divorce.

                                   SECTION 11
                                  WITHDRAWALS
                                  -----------

11.1 WITHDRAWALS BY  PARTICIPANTS  WITH FIVE OR MORE YEARS OF  PARTICIPATION.  A
     participant who is actively employed by an Employer or an Affiliate and who
     has at least five years of  participation  in this Plan (including for this
     purpose,  years  of  participation  in the  Pharmacia  Plan)  may  elect to
     withdraw any portion of the following amounts (to the extent not previously
     withdrawn  and  not  more  than  the  balance  credited  to his  respective
     accounts), in the following order:

     (a)  the  contributions  previously made to his After-Tax  Accounts and all
          earnings credited to such accounts; and

     (b)  those  portions of his Employer  Accounts which are vested at the time
          of withdrawal in accordance with Section 10.2.

     The minimum withdrawal shall be $200 or the balance available, if less. Any
     election by a  participant  under this  Section  must be made in the manner
     prescribed by the Plan Committee.

11.2 WITHDRAWALS BY PARTICIPANTS WITH LESS THAN FIVE YEARS OF  PARTICIPATION.  A
     participant who is actively employed by an Employer or an Affiliate and who
     has less than five years of  participation in this Plan (including for this
     purpose,  years  of  participation  in the  Pharmacia  Plan)  may  elect to
     withdraw the following amounts (to the extent not previously  withdrawn and
     not more than the balance  credited  to his  respective  Accounts),  in the
     following order:

     (a)  his After-Tax Accounts; and

     (b)  those  portions of his Employer  Accounts which are vested at the time
          of withdrawal in accordance with Section 10.2 (excluding contributions
          made to those accounts  during the immediately  preceding  twenty-four
          months).

     The minimum withdrawal shall be $200 or the balance available, if less. Any
     election by a  participant  under this  Section  must be made in the manner
     prescribed by the Plan Committee.

11.3 WITHDRAWALS AND DISTRIBUTIONS FROM BEFORE-TAX  ACCOUNTS AND DIRECT ROLLOVER
     ACCOUNTS PROHIBITED.  Except as provided in Section 11.4 below, withdrawals
     and  distributions  by a participant  from his Before-Tax  Accounts and his
     Direct  Rollover  Account shall be  prohibited  before  retirement,  death,
     Disability, age 59-1/2 or severance from employment.

11.4 AGE 59-1/2 WITHDRAWALS.  Anytime after a participant attains age 59-1/2, he
     may elect to receive any portion of his Before-Tax  Accounts and his Direct
     Rollover  Account.  The  minimum  withdrawal  shall be $200 or the  balance
     available,  if less. Any election by a participant  under this Section must
     be made in the manner prescribed by the Plan Committee.

11.5 CHARGING AND  ALLOCATIONS OF WITHDRAWALS.  All  withdrawals  under Sections
     11.1 through 11.4 shall be charged to the proper account of the participant
     and prorated among the Investment Funds, Employer Company Stock Sub-Fund of
     the Company  Stock Fund,  Chemical  Stock  Fund,  Pharmacia  Stock Fund and
     Pre-Mixed Portfolios in which such account is invested.

                                   SECTION 12
                                     LOANS
                                     -----

12.1 LOANS. The Plan Committee may, in its sole  discretion,  direct the Trustee
     to loan a  participant  amounts from his  Participant  Accounts.  All loans
     shall be subject to the terms,  conditions,  requirements  and  limitations
     specified in this Section and in the SIP Loan  Procedures  document  ("LOAN
     PROCEDURES") which Loan Procedures are hereby incorporated by reference and
     made a part of the Plan.  Loans made to  participants  under  this  Section
     shall  meet  the  requirements  of  Section  72(p)  of  the  Code  and  the
     regulations under Section 408(b)(1) of ERISA.

12.2 LOAN ADMINISTRATION. The loan provisions of this Plan shall be administered
     by the Plan  Committee,  which  shall  establish  the terms and  conditions
     generally applicable to loans made under this Plan.

     In  administering  the loan provisions of this Section,  the Plan Committee
     shall:

     (a)  Adopt such rules and  regulations as it deems necessary for the proper
          and efficient  administration  of loans under the Plan,  including but
          not limited to, appropriate  adjustments in the accounting  provisions
          of  the  Plan  as it  deems  necessary  and  advisable  to  facilitate
          accounting for loans under the Plan;

     (b)  Establish  standards  which  shall  be  used  to  determine  if a loan
          application should be approved;

     (c)  Prescribe the forms to be used in administering the loan provisions of
          this Plan;

     (d)  Determine the method for  calculating  the interest rate to be charged
          on outstanding  loans and when the rate to be charged for new loans is
          to be determined;

     (e)  Determine, from time to time, the minimum loan amount;

     (f)  Employ agents, attorneys,  accountants,  and other persons to properly
          and  efficiently  administer  the loan  provisions of this Plan and to
          collect outstanding loans; and

     (g)  Take all  other  actions  necessary  or  advisable  to  carry  out the
          provisions of this Section.

     The rules and  standards  described  in (a)  through (e) above shall be set
     forth in the Loan Procedures.

12.3 LOAN ELIGIBILITY.  Only those participants who are  parties-in-interest (as
     defined in Section  3(14) of ERISA)  shall be eligible to request a loan or
     obtain a loan.

12.4 LOAN  APPLICATION.  A  participant  must  request  a  loan  in  the  manner
     prescribed by the Plan  Committee.  Only two loans per  participant  may be
     outstanding  at any time.  The loan request must be made at the time and in
     the manner prescribed by the Plan Committee. The request shall be supported
     by such  evidence as the Plan  Committee  may request.  If a  participant's
     termination of employment  should occur after the participant has requested
     a loan  but  before  the loan is made and the  participant  ceases  to be a
     party-in-interest  (as defined in Section 3(14) of ERISA) the participant's
     request  shall   automatically   be  canceled  after  his   termination  of
     employment.

12.5 TERMS AND CONDITIONS OF LOANS.  From time to time the Plan Committee  shall
     establish rules governing the making of loans, including the minimum amount
     for which a loan shall be made and the conditions and terms of repayment of
     principal  and  interest.  Such  rules  shall be  uniformly  applied to all
     participants  similarly situated.  Such rules will be set forth in the Loan
     Procedures.  Each loan shall be evidenced  by a  promissory  note in a form
     approved by the Plan Committee,  shall provide for a reasonable annual rate
     of interest,  and shall be secured by the Loan Account  maintained for that
     participant under the Plan.

12.6 MAXIMUM  LOAN.  The  maximum  loan  shall be the  lesser  of the  following
     amounts:

     (a)  50% of the  participant's  vested Accounts in the Plan,  including the
          Employer Accounts;

     (b)  100% of the participant's Participant Accounts; or

     (c)  $50,000 reduced by the highest total  outstanding loan balances during
          the one-year  period ending on the day before the date on which a loan
          is made.

     The  foregoing  loan  limits  shall  apply  only at the  time  the  loan is
     requested. The Plan Committee may also establish guidelines relating to the
     ability of the  participant  to repay the loan,  which shall  determine the
     maximum amount of any loan which can be made to any participant.

12.7 INTEREST.  Each loan shall bear  interest at a rate to be fixed by the Plan
     Committee.  In determining the interest rate, the Plan Committee shall take
     into  consideration  interest rates  currently  being charged by commercial
     lending  institutions in similar situations.  Interest rates shall be fixed
     for the  term of the  loan at the  time  the  loan is  made,  and the  Plan
     Committee shall determine  periodically  the interest rate to be charged on
     new loans.  The interest rate  determined  hereunder shall be a "reasonable
     rate  of  interest"  within  the  meaning  of  regulations  issued  by  the
     Department of Labor.

12.8 TERM OF LOAN AND  REPAYMENT.  The Plan  Committee  shall  review  each loan
     request and decide whether or not it shall be approved. The decision of the
     Plan  Committee  regarding  the approval of the loan request shall be final
     and binding on all parties.  The period of repayment  for any loan shall be
     determined  by  mutual  agreement   between  the  Plan  Committee  and  the
     participant,  but  such  period  shall  in no event  exceed  sixty  months;
     PROVIDED,  HOWEVER, that the sixty-month repayment period restriction shall
     not apply to any principal  residence loan, which is a loan used to acquire
     a dwelling  that is to be used  within a  reasonable  period of time as the
     principal  residence  of the  participant.  The Plan  Committee  shall have
     discretion  to  determine  when  and  under  what,  if  any,  circumstances
     principal  residence loans shall be made and the loan repayment  period for
     such loans.

     A loan to a  participant  shall  be  secured  by the  Loan  Account  of the
     participant.  Loan payments by a participant who is classified as a Regular
     Full-Time  Employee or Regular  Part-Time  Employee by the Company shall be
     required to be made through payroll  deductions,  and all such participants
     shall be  required,  in the manner  prescribed  by the Plan  Committee,  to
     authorize the Employer to deduct the loan  payments from the  participant's
     wages or salary,  which  amounts  shall be  transmitted  to the Trustee and
     applied  against  the  outstanding   loan  balance.   Loan  payments  by  a
     participant  who is employed  other than as a regular  full-time or regular
     part-time  employee  will  be  made  by  payroll  deduction  to the  extent
     possible.  If such  participant  does  not  receive  a  paycheck  or if the
     paycheck is less than the loan repayment amount, the participant must repay
     the loan by personal check.  Loan payments by a participant who is employed
     by an Affiliate or Subsidiary  which is not a participating  Employer shall
     be made by payroll deduction unless payroll deduction is not permissible or
     the Plan  Committee  determines  such  method is not  practicable.  If loan
     payments are not made by payroll deduction,  the participant must make such
     loan payments by personal check.

     Loan  payments  by a retired  or  terminated  vested  participant  who is a
     "party-in-interest"  (as such term is defined  in  Section  3(14) of ERISA)
     shall be made by personal check.

     Participants may prepay the entire amount of the remaining unpaid principal
     balance (and all  remaining  interest  due  thereon)  other than by payroll
     deduction at any time without penalty.

12.9 SOURCE  OF LOAN  FUNDS.  Loans  shall  only be  made  from a  participant's
     Participant Accounts. A participant's Employer Accounts shall not under any
     circumstances be used for a loan.

12.10 ACCOUNTING FOR LOANS.  A loan  granted to a  participant  shall be made by
     liquidating and converting to cash the Before-Tax Accounts, Direct Rollover
     Account  and  After-Tax  Contributions  Accounts,  in  that  order.  If the
     participant's  Participant  Accounts  are  invested  in two or  more of the
     Investment  Funds,  Pre-Mixed  Portfolios,   Pharmacia  Stock  Fund  and/or
     Chemical  Stock Fund,  the loan proceeds  shall be taken pro rata from such
     Investment  Funds,  Pre-Mixed  Portfolios,   Pharmacia  Stock  Fund  and/or
     Chemical  Stock  Fund.  A  participant's  Accounts  shall be debited in the
     following order: Before-Tax Accounts, Direct Rollover Account and After-Tax
     Accounts.  A Loan Account shall then be  established  for the  participant,
     which shall reflect the outstanding unpaid balance of the loan from time to
     time in  accordance  with Section 9.3. Loan  repayments  shall be separated
     into principal and interest  payments.  Principal payments shall be debited
     against the  participant's  Loan  Account and  credited to his  Participant
     Accounts in the following order:

     (a)  First, to the After-Tax  Accounts up to the amount that was debited to
          such accounts to make the loan;

     (b)  Second,  to the Direct  Rollover  Account  up to the  amount  that was
          debited to such account to make the loan; and

     (c)  Third, to the Before-Tax Accounts up to the amount that was debited to
          such accounts to make the loan.

     Interest payments shall be debited against the  participant's  Loan Account
     and  credited  to his  Participant  Accounts  in  the  same  manner  as the
     outstanding loan balance. Principal and interest payments shall be invested
     in the Investment Funds and/or Pre-Mixed  Portfolios in accordance with the
     participant's current investment election for new contributions.

12.11 WITHDRAWALS AND DISTRIBUTIONS  WHILE  LOAN  BALANCE  IS  OUTSTANDING.   A
     participant  with an outstanding  loan balance who applies for a withdrawal
     of his After-Tax Accounts shall be eligible only to the extent that amounts
     are available in excess of the balance of the  participant's  Loan Account.
     Such a withdrawal shall not automatically cancel the loan.

     When a final  distribution is made with respect to a participant who has an
     outstanding  loan  balance,  the  participant  (or his  beneficiary)  shall
     receive a distribution  of his vested Accounts offset by the balance of the
     participant's Loan Account. In addition, the participant's  promissory note
     shall  be  distributed  to the  participant  (or his  beneficiary)  and the
     balance in the participant's Loan Account shall be reduced to zero.

     If a participant who has an outstanding loan balance terminates employment,
     he may repay the entire  amount of the  outstanding  unpaid  principal  and
     interest within the time period ending two months following the date of his
     termination of  employment.  If such amount is not repaid within two months
     following the  participant's  termination of employment,  the participant's
     promissory   note  shall  be  distributed  to  the   participant   (or  his
     beneficiary)  and the balance in the  participant's  Loan Account  shall be
     reduced to zero.  Notwithstanding any of the foregoing, if such participant
     continues  to  qualify  as a  party-in-interest  after his  termination  of
     employment,  he may continue to make loan payments of unpaid  principal and
     interest by personal check after such termination of employment;  PROVIDED,
     HOWEVER, he may not elect to begin receiving payments under the Installment
     Payout  Option until the entire  amount of the  outstanding  principal  and
     interest is repaid.

     In no event shall a participant,  his  beneficiary,  or any other person be
     paid  in  cash  (or  property  other  than  the  promissory   note  of  the
     participant) an amount  attributable  to a balance in a participant's  Loan
     Account.

     For a participant who terminates employment:

          o    involuntarily  and is  determined  by the  Company  to have  been
               terminated through no fault of his own, or

          o    as the result of either the disposition of substantially  all the
               assets (within the meaning of Section 409(d)(2) of the Code) used
               in a trade or business of an Employer or the  disposition  of the
               interest in an  Affiliate  or  Subsidiary  (within the meaning of
               Section 409(d)(3) of the Code),

     the Plan shall accept as loan payments,  amounts paid by the participant by
     personal check after such termination of employment.  Except as provided in
     Section 12.12, the outstanding principal and interest of any such loan will
     not be treated as a deemed taxable  distribution  prior to the distribution
     of the participant's Accounts.

12.12 UNPAID BALANCES AT END OF SIXTY-MONTH  REPAYMENT PERIOD. In the event that
     any  principal  or interest on any loan remains  outstanding  at the end of
     sixty months following the date of the loan (or, in the case of a principal
     residence loan having a repayment period greater than sixty months, the end
     of such repayment period), the Trustee, or its delegate,  shall declare the
     remaining  unpaid loan balance to be a taxable  distribution  from the Plan
     for purposes of Section 72(p) of the Code and the  participant's  tax basis
     in the Plan shall be decreased by the amount of such taxable  distribution,
     but not below zero. If the outstanding loan balance is subsequently repaid,
     the principal  payments shall be credited as provided in Section 12.10. For
     all other purposes,  the remaining unpaid loan balance,  including  accrued
     interest thereon,  shall remain a legal obligation of the participant,  and
     the  Trustee  and the Plan  Committee  shall take all  necessary  action to
     ensure its collection.

12.13 HARDSHIP WITHDRAWAL IN BANKRUPTCY.  Upon an adjudication of bankruptcy, as
     defined  below,  the Plan Committee  shall  determine if the bankruptcy has
     caused the participant to incur a hardship.  If the Plan Committee,  in its
     sole discretion,  determines that a hardship (within the meaning of Section
     401(k)(2)(B) of the Code and the Treasury  regulations  issued  thereunder)
     exists,  the Plan  Committee  shall  declare a hardship  distribution,  the
     promissory  note  shall  be  distributed  to  the   participant,   and  the
     participant's   Loan  Account  shall  be  reduced  by  the  amount  of  the
     outstanding loan balance. In no event shall a participant,  his beneficiary
     or any other person be paid in cash (or property  other than the promissory
     note of the  participant)  an amount  attributable to a balance in his Loan
     Account. An "ADJUDICATION OF BANKRUPTCY" means the earlier of:

     (a)  An entry of an order for relief with respect to the participant  under
          the United States Bankruptcy Code, as amended; or

     (b)  The filing of a petition  against the  participant  in an  involuntary
          case under the United States Bankruptcy Code, as amended.

12.14 FAILURE TO REPAY LOANS. The Plan Committee shall  establish  uniform rules
     to apply when a  participant  fails to repay any  portion of a loan made to
     him and accrued  interest thereon in accordance with the terms of the loan,
     or when any portion of a loan and accrued  interest  thereon remains unpaid
     on a participant's termination of employment. Such rules shall be set forth
     in the Loan Procedures.

12.15 LOANS  TO CERTAIN  TERMINATED  OR  RETIRED  PARTICIPANTS.  Notwithstanding
     anything to the  contrary  contained  in the Plan,  a  participant  who has
     terminated employment and who is a party-in-interest (as defined in Section
     3(14) of ERISA)  shall be  eligible  to request a loan in  accordance  with
     Section  12.4 and to obtain a loan.  Notwithstanding  the  preceding,  if a
     participant who is receiving  payments  pursuant to the Installment  Payout
     Option and who is a  party-in-interest  (as  defined  in  Section  3(14) of
     ERISA)  obtains a loan under the Plan,  the  installment  payments  to such
     participant shall be suspended during the term of the loan.

                                   SECTION 13
                               THE PLAN COMMITTEE
                               ------------------

13.1 MEMBERSHIP.  The Plan  Committee  shall  consist  of three or more  members
     appointed by the Company.

13.2 PLAN  COMMITTEE'S  GENERAL POWERS,  RIGHTS AND DUTIES.  The Plan Committee,
     which is established by and derives its authority from the Company,  is, as
     respects the rights and obligations of all parties with an interest in this
     Plan, given the powers,  rights and duties specifically stated elsewhere in
     the Plan,  the Trust  Agreement or any other  document,  and in addition is
     given the following powers, rights and duties:

     (a)  Discretionary  authority to determine all questions  arising under the
          Plan,  including the power to determine the rights or  eligibility  of
          employees or  participants  and any other persons,  and the amounts of
          their   benefits   under   the  Plan,   and  to  remedy   ambiguities,
          inconsistencies or omissions.

     (b)  To adopt such rules of procedure and  regulations  as, in its opinion,
          may be necessary  for the proper and efficient  administration  of the
          Plan and as are consistent with the Plan and Trust Agreement.

     (c)  To enforce the Plan in accordance with terms of the Plan and the Trust
          Agreement and in accordance with the rules and regulations  adopted by
          the Plan Committee as provided above.

     (d)  To direct the Trustee as  respects  payments,  distributions  or loans
          from the Trust Fund in accordance with the provisions of the Plan.

     (e)  To furnish the Employers  with such  information as may be required by
          them for tax or other purposes as respects the Plan.

     (f)  To employ  agents,  attorneys,  accountants or other persons (who also
          may be employed by the Employers,  the Fund Committee or the Trustee),
          and allocate or delegate to them such powers, rights and duties as the
          Plan  Committee may consider  necessary or advisable to properly carry
          out the  administration of the Plan,  provided that such allocation or
          delegation  and the  acceptance  thereof  by such  agents,  attorneys,
          accountants or other persons, shall be in writing.

13.3 MANNER OF ACTION.  During  any  period in which two or more Plan  Committee
     members are acting with respect to the Plan, the following provisions apply
     where the context admits:

     (a)  The Plan Committee  members may act by meeting or may take action in a
          writing signed without  meeting,  and may sign any document by signing
          one document or concurrent documents.

     (b)  An action or a  decision  of a  majority  of the  members  of the Plan
          Committee  as to a matter shall be as effective as if taken or made by
          all members of the Plan Committee.

     (c)  A Plan  Committee  member by writing  may  delegate  any or all of his
          rights,  powers,  duties and  discretions  to any other Plan Committee
          member, with the consent of the latter.

     (d)  If, because of the number  qualified to act, there is an even division
          of  opinion  among  the  Plan  Committee  members  as to a  matter,  a
          disinterested  party selected by the Plan  Committee  shall decide the
          matter and such party's decision shall control.

     (e)  Except as otherwise  provided by law, no member of the Plan  Committee
          shall be liable or  responsible  for an act or  omission  of the other
          Plan Committee member(s) in which the former has not concurred.

     (f)  The  certificate  of the  Secretary  of  the  Plan  Committee  or of a
          majority of the Plan  Committee  members that the Plan  Committee  has
          taken or  authorized  any action shall be  conclusive  in favor of any
          person relying on the certificate.

     (g)  The Plan Committee, as a Named Fiduciary,  may delegate its authority,
          duties and responsibilities  hereunder to other persons, including the
          Company and its officers, employees or agents. Such a delegation shall
          be in  writing  and  specify  the  identity  of the  delegate  and the
          responsibilities delegated to such person.

13.4 INFORMATION  REQUIRED BY PLAN  COMMITTEE.  The Employers  shall furnish the
     Plan  Committee  with such data and  information  as the Plan Committee may
     deem necessary or desirable in order to administer the Plan. The records of
     the  Employers as to an employee's  or  participant's  period or periods of
     employment,  termination  of employment and the reason  therefor,  leave of
     absence, reemployment and earnings will be conclusive on all persons unless
     determined  to  the  Plan   Committee's   satisfaction   to  be  incorrect.
     Participants  and other  persons  entitled to benefits  under the Plan also
     shall furnish the Plan Committee with such evidence, data or information as
     the Plan Committee considers necessary or desirable to administer the Plan.

13.5 PLAN COMMITTEE DECISION FINAL. Subject to applicable law and the provisions
     of Section 13.6, any  interpretation  of the provisions of the Plan and any
     decision on any matter within the  discretion of the Plan Committee made by
     the Plan  Committee  in good  faith  shall be  binding  on all  persons.  A
     misstatement  or other  mistake of fact shall be corrected  when it becomes
     known and the Plan Committee  shall make such adjustment on account thereof
     as it considers equitable and practicable.

13.6 REVIEW OF BENEFIT DETERMINATIONS. The Plan Committee will provide notice in
     writing to any  participant,  beneficiary  or other  person whose claim for
     benefits under the Plan is denied and the Plan Committee  shall afford such
     participant,  beneficiary  or other  person a full and fair  review  of its
     decision, if so requested.

13.7 DELEGATION OF AUTHORITY.  Notwithstanding  anything herein to the contrary,
     the Plan  Committee or Fund  Committee  may delegate any of its  authority,
     duties or responsibilities  under this Plan to any other person,  including
     the Company and its officers,  employees or agents. Such a delegation shall
     be in writing  and shall  specify  the  identity  of the  delegate  and the
     responsibilities delegated to such person.

13.8 UNIFORM RULES. The Plan Committee shall administer the Plan on a reasonable
     and   nondiscriminatory   basis  and  shall  apply  uniform  rules  to  all
     participants similarly situated.

                                   SECTION 14
                           RELATING TO THE EMPLOYERS
                           -------------------------

14.1 ACTION BY  EMPLOYERS.  Any action  required or  permitted  of an  Employer,
     including  the Company,  under the Plan shall be by resolution of its Board
     of Directors,  by a duly authorized committee of its Board of Directors, or
     by a person or persons  authorized  by resolution of its Board of Directors
     or by resolution of such committee.

14.2 ADDITIONAL  EMPLOYERS.  Any Affiliate or Subsidiary that is not an Employer
     may adopt the Plan and become an Employer under the Plan and a party to the
     Trust Agreement by filing with the Plan Committee certified copies of:

     (a)  a resolution of the Board of Directors of the Affiliate or Subsidiary,
          or its duly  authorized  delegate,  providing  for its adoption of the
          Plan; and

     (b)  a  resolution  of the  Company's  Board  of  Directors,  or  its  duly
          authorized  delegate,  consenting  to the adoption of the Plan by such
          Affiliate or Subsidiary.

14.3 RESTRICTIONS  AS TO REVERSION OF TRUST  ASSETS TO  EMPLOYERS.  Except as to
     contributions and premiums paid as a result of mathematical  error or other
     mistake of fact,  the Employers  shall have no right,  title or interest in
     the  assets of the Trust  Fund nor will any part of the assets of the Trust
     Fund at any time revert or be repaid to an  Employer,  unless the  Internal
     Revenue  Service  initially  determines  that the Plan,  as  applied  to an
     Employer that had not  previously  maintained  the Plan,  does not meet the
     requirements  of a  "qualified  plan"  under  the  Code.  In  the  case  of
     contributions or premiums paid by the Employers as a result of a mistake of
     fact,  such  contributions  or premiums  may be  returned to the  Employers
     within one year after their payment.

                                   SECTION 15
                               GENERAL PROVISIONS
                               ------------------

15.1 NOTICES.  Each  person  entitled  to  benefits  under the Plan must file in
     writing with the Plan  Committee such person's post office address and each
     change of post  office  address.  Any  communication,  statement  or notice
     addressed to any such person at the last post office address filed with the
     Plan  Committee  will be binding  upon such person for all  purposes of the
     Plan,  and the Plan  Committee,  the Fund  Committee,  the Employers or the
     Trustee shall not be obligated to search for or ascertain  the  whereabouts
     of any such person. Any notice or document required to be given to or filed
     with either the Plan Committee or the Fund Committee shall be considered as
     given or filed if delivered or mailed by registered mail,  postage prepaid,
     to such committee in care of the Company,  800 North  Lindbergh  Boulevard,
     St. Louis, Missouri 63167.

15.2 WAIVER OF NOTICE.  Any notice required under this Plan may be waived by the
     person entitled to notice.

15.3 ABSENCE OF GUARANTY. Neither the Plan Committee, the Fund Committee nor any
     Employer in any way  guarantees  the Trust Fund or any other fund from loss
     or depreciation, nor guarantees any payment to any person. The liability of
     the  Employers,  the Trustee,  the Plan  Committee or the Fund Committee to
     make any  payment  under the Plan will be limited to the assets held by the
     Trustee as a part of the Trust Fund.

15.4 EMPLOYMENT  RIGHTS.  The Plan does not constitute a contract of employment,
     and participation in the Plan will not give any participant the right to be
     retained  in the  employ  of the  Employers,  nor any right or claim to any
     benefit under the Plan, unless such right or claim has specifically accrued
     under the terms of the Plan.

15.5 INTERESTS  NOT  TRANSFERABLE.   Except  as  may  be  required  by  the  tax
     withholding  provisions  of the  Code,  Section  401(a)(13)(B)  of the Code
     dealing with Qualified  Domestic  Relations Orders, or a state's income tax
     act,  and except (to the extent  permitted  by law) as to any debt owing to
     the Trustee as a result of  participation  in the Plan,  the  interests  of
     participants  and  their  beneficiaries  under  this  Plan  and  the  Trust
     Agreement  are not subject to the claims of their  creditors and may not be
     voluntarily or  involuntarily  sold,  transferred,  alienated,  assigned or
     encumbered.

15.6 FACILITY OF PAYMENT.  When a person  entitled to benefits under the Plan is
     under a legal disability,  or, in the Plan Committee's  opinion,  is in any
     way incapacitated so as to be unable to manage his financial  affairs,  the
     Plan Committee may direct that the benefits to which such person  otherwise
     would be entitled shall be made to such person's legal  representative,  or
     to a relative or friend of such person for such  person's  benefit,  or the
     Plan Committee may direct the  application of such benefits for the benefit
     of such person.  If the Plan Committee  receives proper  authorization by a
     participant  or any other person  entitled to benefits  under the Plan, and
     unless and until the Plan  Committee is notified or becomes aware that such
     authorization  no longer is in effect,  the Plan Committee will direct that
     periodic deposits of the benefits which otherwise would be payable directly
     to the  participant  shall  be made  into a  savings  or  checking  account
     established  in his  name at a bank or  other  financial  institution.  Any
     payment made in accordance  with the  provisions of this Section 15.6 shall
     be a full and complete  discharge of any  liability  for such payment under
     the Plan.

15.7 GENDER AND NUMBER.  Where the context admits,  words denoting the masculine
     gender shall include the feminine and neuter  genders,  the singular  shall
     include the plural, and the plural shall include the singular.

15.8 EVIDENCE. Evidence required of anyone under the Plan may be by certificate,
     affidavit,  document  or other  information  which the person  acting on it
     considers  pertinent  and  reliable,  and signed,  made or presented by the
     proper party or parties.

15.9 INDEMNITY. Without in any way limiting the scope of any indemnity agreement
     entered  into in favor of or by and  between  parties  referred  to in this
     Section,  the Plan  Committee,  the Fund  Committee,  the  members of those
     committees,  the former members of those committees and any persons who are
     or were  directors,  officers or employees of the Employers,  Affiliates or
     Subsidiaries  and each of them,  shall be indemnified and saved harmless by
     the Company  from and  against any and all  liability,  or  allegations  of
     liability, to which the Plan Committee,  the Fund Committee, the members or
     former members of those committees, such directors,  officers, or employees
     or such former directors,  officers or employees may be subjected by reason
     of any act done or omitted  to be done in good faith in the  administration
     of the Plan or Trust  or in the  investment  of the  assets  of the  Trust,
     including  all expenses  reasonably  incurred in their defense in the event
     the Company  fails to provide such defense  after having been  requested in
     writing to do so.

15.10 CONTROLLING STATE LAW.  To the extent  not  superseded  by the laws of the
     United  States,  the laws of  Missouri,  determined  without  regard to its
     conflict of law rules,  shall be controlling in all matters relating to the
     Plan.

15.11 SEVERABILITY.  In case any provisions of the Plan shall be held illegal or
     invalid for any reason,  such illegality or invalidity shall not affect the
     remaining  provisions  of the Plan,  and the Plan  shall be  construed  and
     enforced as if such illegal and invalid provisions had never been set forth
     in the Plan.

15.12 HEADINGS.  The Headings and sub-headings  in the Plan and Trust  Agreement
     are inserted for  convenience  and reference only and are not to be used in
     construing  this  Plan or any  provision  thereof.

15.13 SUCCESSORS.  The  provisions of  this  Plan  shall  be  binding  upon  the
     Employers and their  successors and assigns and upon the  participants  and
     their heirs, beneficiaries, estates and legal representatives.

15.14 NO REDUCTIONS FOR SOCIAL SECURITY INCREASES. No benefits otherwise payable
     under the Plan shall be decreased  because of increases in Social  Security
     Benefits occurring after the participant's termination of employment.

15.15 MILITARY SERVICE.  Notwithstanding any other provision of this Plan to the
     contrary,  contributions,  benefits  and  service  credit  with  respect to
     qualified  military  service  will be provided in  accordance  with Section
     414(u) of the Code.

                                   SECTION 16
                     AMENDMENT, TERMINATION OR PLAN MERGER
                     -------------------------------------

16.1 AMENDMENT.  While the Employers expect and intend to continue the Plan, the
     Company reserves the right to amend,  retroactively or  prospectively,  the
     Plan from time to time, except as follows:

     (a)  Except as may be  required  by the  Internal  Revenue  Service for the
          purpose  of  meeting  the  conditions  for  qualification  or for  tax
          deduction  under  Sections 401 through 415 and Section 501 of the Code
          or as may be required  by ERISA or any other state or federal  law, no
          action of the Company  hereunder shall alter the operation of the Plan
          as it applies  to  employees  with whom or with whose  representatives
          there exists a written collective  bargaining  agreement pertaining to
          retirement income benefits, during the term of any such agreement.

     (b)  Except as  provided  in Section  14.3,  under no  condition  shall any
          amendment  result in the return or  repayment  to any  Employer of any
          part of the  Trust  Fund or the  income  therefrom,  or  result in the
          distribution  of the Trust Fund for the  benefit of anyone  other than
          employees and former  employees of the Employers and any other persons
          entitled to benefits under the Plan.

16.2 TERMINATION.  The  Plan  will  terminate  as to all  Employers  on any date
     specified  by  the  Company  if 30  days'  advance  written  notice  of the
     termination is given to the Plan Committee, the Fund Committee, the Trustee
     and the  other  Employers.  The Plan  will  terminate  as to an  individual
     Employer on the first to occur of the following:

     (a)  The date it is  terminated  by the Board of Directors of that Employer
          or its duly authorized delegate.

     (b)  The date the Employer completely  discontinues its contributions under
          the Plan.

     (c)  The date that Employer is judicially declared bankrupt or insolvent.

     (d)  The  dissolution,  merger,  consolidation  or  reorganization  of that
          Employer,  or the sale by that Employer of all or substantially all of
          its assets, except that:

          (i)  In any such event  arrangements  may be made with the  consent of
               the Company whereby the Plan may be continued by any successor to
               that Employer or any purchaser of all or substantially all of its
               assets,   in  which  case  the  successor  or  purchaser  may  be
               substituted  for that  Employer  under  the  Plan  and the  Trust
               Agreement; and

          (ii) If any Employer is merged,  dissolved  or in any way  reorganized
               into,  or  consolidated  with,  any other  Employer,  the Plan as
               applied to the former  Employer  will  automatically  continue in
               effect without a termination thereof.

16.3 PLAN  MERGER OR  CONSOLIDATION.  In no event  shall  there be any merger or
     consolidation  of the Plan with, or transfer of assets or  liabilities  to,
     any other plan unless each  participant in the Plan would (if the Plan then
     terminated) receive a benefit immediately after the merger,  consolidation,
     or transfer  which is equal to or greater than the benefit the  participant
     would  have  been  entitled  to  receive  immediately  before  the  merger,
     consolidation,  or transfer (if the Plan had then terminated). In the event
     a qualified plan is merged into the Plan, the Funds Committee may establish
     such rules and  procedures  as necessary to allocate the assets of accounts
     transferred to the Plan among the Investment Funds.

16.4 NOTICE OF AMENDMENT, TERMINATION OR PLAN MERGER. Affected participants will
     be notified of any termination,  plan merger,  consolidation or substantial
     amendment within a reasonable time.

16.5 VESTING  AND  DISTRIBUTION  ON  TERMINATION.   On  termination  or  partial
     termination of the Plan,  the date of  termination  or partial  termination
     will be a Special  Accounting Date and, after all adjustments then required
     have been made,  the  benefits of all affected  participants  will be fully
     vested.  If, on partial  termination  of the Plan, an affected  participant
     remains an employee of any Employer, Affiliate or Subsidiary, the amount of
     his benefits  shall be retained in the Trust Fund,  subject to his right to
     make withdrawals in accordance with Section 11, until after his termination
     of employment  with such  Employer,  Affiliate or Subsidiary and as soon as
     practicable  thereafter  shall  be  paid  to him  in  accordance  with  the
     provisions of Sections 10.4 and 10.5.

16.6 TRANSFER  OF  ASSETS  AND   LIABILITIES.   The  Plan  Committee  acting  in
     conjunction  with the Fund  Committee may request the Trustee in writing to
     accept  the  transfer  of assets  and  liabilities  from the  trustee of an
     employee pension plan maintained by another employer ("TRANSFEROR PLAN") to
     the Trust Fund; PROVIDED:

     (a)  the Transferor  Plan is qualified under Section 401(a) of the Code and
          the trust  maintained by the  Transferor  Plan to which the assets and
          liabilities are transferred is exempt from tax under Section 501(a) of
          the Code;

     (b)  the transfer complies with Section 414(l) of the Code; and

     (c)  where   required  or   advisable,   the  approval  of  all   necessary
          governmental agencies has been obtained.

     The Plan  Committee  acting  in  conjunction  with the Fund  Committee  may
     request the Trustee in writing to transfer  assets and  liabilities  of the
     Trust Fund to the trustee of an employee pension benefit plan maintained by
     another employer ("TRANSFEREE PLAN"); PROVIDED:

     (i)  the Transferee  Plan is qualified under Section 401(a) of the Code and
          the trust  maintained by the  Transferee  Plan to which the assets and
          liabilities are transferred is exempt from tax under Section 501(a) of
          the Code;

     (ii) the transfer complies with Section 414(l) of the Code; and

     (iii)where   required  or   advisable,   the  approval  of  all   necessary
          governmental agencies is obtained.

                                   SECTION 17
                               DIRECTED ROLLOVERS
                               ------------------

17.1 DIRECTED  ROLLOVERS.  This Section 17 applies to  distributions  made on or
     after  January 1, 1993.  Notwithstanding  any  provision of the Plan to the
     contrary that would  otherwise  limit a  Distributee's  election under this
     Section,  a Distributee may elect, at the time and in the manner prescribed
     by the  Plan  Committee,  to  have  any  portion  of an  Eligible  Rollover
     Distribution  (as  defined in Section  17.2) paid  directly  to an Eligible
     Retirement  Plan (as defined in Section 17.3)  specified by the Distributee
     (as defined in Section  17.4) in a Direct  Rollover  (as defined in Section
     17.5).

17.2 ELIGIBLE ROLLOVER  DISTRIBUTION.  An Eligible Rollover  Distribution is any
     distribution  of all or any  portion  of the  balance  to the credit of the
     Distributee,  except  that  an  Eligible  Rollover  Distribution  does  not
     include:

     (a)  any  distribution  that  is one of a  series  of  substantially  equal
          periodic  payments (not less  frequently  than  annually) made for the
          life expectancy of the  Distributee,  or for a specified period of ten
          years or more;

     (b)  any  distribution  to the extent such  distribution  is required under
          Section 401(a)(9) of the Code;

     (c)  any hardship distribution; and

     (d)  any other distributions  specified in Section 402(c)(4) of the Code or
          designated by the IRS in revenue  rulings,  notices and other guidance
          of general applicability.

17.3 ELIGIBLE  RETIREMENT  PLAN.  An Eligible  Retirement  Plan is an individual
     retirement  account  described in Section 408(a) of the Code, an individual
     retirement annuity described in Section 408(b) of the Code, an annuity plan
     described in Section 403(a) of the Code, an annuity  contract  described in
     Section  403(b) of the Code, an eligible  plan under Section  457(b) of the
     Code which is maintained by a state,  political  subdivision of a state, or
     any agency or  instrumentality  of a state or  political  subdivision  of a
     state,  or a qualified  trust described in Section 401(a) of the Code, that
     accepts and agrees to  separately  account for the  Distributee's  Eligible
     Rollover Distribution.

17.4 DISTRIBUTEE.  A  Distributee  includes an employee or former  employee.  In
     addition,  the  employee's or former  employee's  surviving  spouse and the
     employee's  or  former  employee's  spouse  or  former  spouse  who  is the
     Alternate Payee under a QDRO are  Distributees  with regard to the interest
     of the spouse or former spouse.

17.5 DIRECT ROLLOVER. A direct rollover is a payment by the Plan to the Eligible
     Retirement Plan specified by the Distributee.

                                   SECTION 18
                              TOP-HEAVY PROVISIONS
                              --------------------

18.1 DETERMINATION OF TOP-HEAVY.  Except as otherwise  provided in this Section,
     the Plan shall be considered a Top-Heavy Plan with respect to any Plan Year
     commencing  on or  after  January  1,  1984  if,  as of the last day of the
     preceding Plan Year:

     (a)  The aggregate of the sum of the Accounts of  participants  who are Key
          Employees  (as defined in Section  416(i) of the Code)  exceeds  sixty
          percent  of  the   aggregate  of  the  sum  of  the  Accounts  of  all
          participants (the "60% TEST"); or

     (b)  The Plan is part of a required  aggregation group (defined as (1) each
          qualified  plan of the  Employer  in which at least  one Key  Employee
          participates,  and (2) any other  qualified plan of the Employer which
          enables a plan described in (1) to meet the  requirements  of Sections
          401(a)(4) or 410 of the Code) and, as of the last day of the preceding
          Plan Year:

          (i)  The sum of (1) the present value of the accrued  benefits for Key
               Employees under all defined benefit plans included in such group,
               and (2) the aggregate of the Accounts of Key Employees  under all
               defined contribution plans included in such group,

          (ii) Exceeds  sixty  percent  of the  sum,  as of the  last day of the
               preceding  Plan Year,  of the amounts  specified in (i) above for
               all participants.

     Notwithstanding  anything in this  Section 18.1 to the  contrary,  the Plan
     shall not be  considered a Top-Heavy  Plan with respect to any Plan Year if
     the  Plan is a part  of a  permissive  aggregation  group  (defined  as the
     required  aggregation  group of plans  plus any other  plan or plans of the
     Employer which,  when  considered as a group with the required  aggregation
     group, would continue to satisfy the requirements of Sections 401(a)(4) and
     410 of the  Code),  which  does not  satisfy  the  requirements  of Section
     18.1(b) above.

     Distributions  on account of separation  from service,  death or disability
     made  within the  preceding  Plan Year,  and any other  distributions  made
     within the preceding  Plan Year and within the four Plan Years  immediately
     preceding such Plan Year,  shall be added to the Account of any participant
     in  determining  whether the Plan shall be  considered  a  Top-Heavy  Plan.
     However,  the Accounts and the Accrued Benefits of a participant who is not
     a Key  Employee  but who was a Key Employee in a prior Plan Year or who has
     not  performed  any services for any Employer  maintaining  the Plan at any
     time during the preceding Plan Year will be disregarded.

18.2 MINIMUM  ALLOCATIONS.  Notwithstanding  the  provisions of Section 6 or any
     other provision of the Plan to the contrary, for any year in which the Plan
     is deemed a Top-Heavy Plan, the minimum Employer  Contributions  for a Plan
     Year for each  participant who is a Non-Key  Employee shall be equal to the
     lesser of:

     (a)  Three percent of the participant's compensation (as defined in Section
          18.6); or

     (b)  The  percentage  at  which  Before-Tax   Contributions   and  Employer
          Contributions  are made or  required to be made under the Plan for the
          Key Employee for whom such percentage is highest for the Plan Year.

     This  minimum  allocation  shall be made  even  though,  under  other  Plan
     provisions,  the participant  would not otherwise be entitled to receive an
     allocation, or would have received a lesser allocation for the year because
     of (i) the participant's failure to complete 1,000 hours of service (or any
     equivalent provided in the Plan), or (ii) the participant's failure to make
     mandatory  employee  contributions to the plan, or (iii)  compensation less
     than a stated amount.

     If a participant is also covered by a top-heavy  defined benefit plan of an
     Affiliated   Employer,   "5%"  shall  be  substituted  for  "3%"  above  in
     determining the minimum contribution.

18.3 MINIMUM  VESTING.  If a participant  terminates  employment with all of the
     Employers,  Affiliates and Subsidiaries  before retirement,  payment of his
     Accounts shall be governed by Section 10.2 of the Plan.

18.4 REPEAL,  MODIFICATION OR POSTPONEMENT OF TOP-HEAVY PROVISIONS. In the event
     that  all or any  portion  of  Section  416 of the Code is  modified,  this
     Section 18 shall be  construed  to adopt such  modifications.  In the event
     that  all or any  portion  of  Section  416 of the Code is  repealed,  this
     Section 18 shall have no effect as of the  effective  date of such  repeal.
     Furthermore, if the effective date of Section 416 of the Code is delayed or
     postponed, this Section 18 shall have no effect until the effective date of
     Section 416 of the Code.

18.5 NON-KEY  EMPLOYEE.  "Non-Key  Employee" means any employee who is not a Key
     Employee (as defined in Section 416(i) of the Code).

18.6 COMPENSATION. For purposes of this Section 18, compensation means the gross
     amount  earned by an  employee  from an  Employer  during the Plan Year for
     services rendered while a participant as reported on Form W-2.

18.7 TOP-HEAVY  RATIO.  For purposes of these top-heavy  provisions,  "top-heavy
     ratio" shall mean:

     (a)  If the  employer  maintains  one or more  defined  contribution  plans
          (including any Simplified  Employee Pension Plan) and the employer has
          not maintained any defined benefit plan which during the 5-year period
          ending on the  determination  date(s) has or has had accrued benefits,
          the  top-heavy  ratio  for  this  plan  alone or for the  required  or
          permissive  aggregation  group  as  appropriate  is  a  fraction,  the
          numerator  of  which  is the sum of the  account  balances  of all key
          employees as of the determination  date(s)  (including any part of any
          account  balance  distributed  on account of separation  from service,
          death or disability in the one-year period ending on the determination
          date(s) and any other  distributions  made in the 5-year period ending
          on the determination date(s)), and the denominator of which is the sum
          of all account  balances  (including  any part of any account  balance
          distributed on account of separation from service, death or disability
          in the one-year  period  ending on the  determination  date(s) and any
          other   distributions   made  in  the  5-year  period  ending  on  the
          determination  date(s)),  both computed in accordance with Section 416
          of the Code and the regulations thereunder. Both the numerator and the
          denominator  of the  top-heavy  ratio are  increased  to  reflect  any
          contribution not actually made as of the determination date, but which
          is required to be taken into account on that date under Section 416 of
          the Code and the regulations thereunder.

     (b)  If the  employer  maintains  one or more  defined  contribution  plans
          (including  any  Simplified  Employee  Pension  Plan) and the employer
          maintains or has  maintained  one or more defined  benefit plans which
          during the 5-year  period ending on the  determination  date(s) has or
          has had any accrued benefits,  the top-heavy ratio for any required or
          permissive  aggregation  group  as  appropriate  is  a  fraction,  the
          numerator of which is the sum of account balances under the aggregated
          defined  contribution plan or plans for all key employees,  determined
          in  accordance  with (a)  above,  and the  present  value  of  accrued
          benefits  under the aggregated  defined  benefit plan or plans for all
          key employees as of the determination  date(s), and the denominator of
          which is the sum of the account balances under the aggregated  defined
          contribution  plan  or  plans  for  all  participants,  determined  in
          accordance with (a) above,  and the present value of accrued  benefits
          under the defined benefit plan or plans for all participants as of the
          determination  date(s),  all determined in accordance with Section 416
          of the Code and the regulations thereunder. The accrued benefits under
          a defined  benefit plan in both the numerator and the  denominator  of
          the top-heavy  ratio are increased for any  distribution of an accrued
          benefit  made  on  account  of  separation  from  service,   death  or
          disability in the one-year period ending on the determination date and
          any other  distribution  of an accrued  benefit made in the  five-year
          period ending on the determination date.

     (c)  For purposes of (a) and (b) above,  the value of account  balances and
          the present  value of accrued  benefits  will be  determined as of the
          most recent valuation date that falls within or ends with the 12-month
          period ending on the determination date, except as provided in Section
          416 of the Code  and the  regulations  thereunder  for the  first  and
          second plan years of a defined benefit plan. The account  balances and
          accrued  benefits of a  participant  (1) who is not a key employee but
          who was a key  employee  in a  prior  year,  or (2)  who has not  been
          credited  with  at  least  one  hour  of  service  with  any  employer
          maintaining  the plan at any time during the one-year period ending on
          the  determination  date will be  disregarded.  The calculation of the
          top-heavy ratio, and the extent to which distributions, rollovers, and
          transfers  are taken  into  account  will be made in  accordance  with
          Section  416 of the Code and the  regulations  thereunder.  Deductible
          employee  contributions will not be taken into account for purposes of
          computing the top-heavy  ratio.  When  aggregating  plans the value of
          account   balances  and  accrued  benefits  will  be  calculated  with
          reference  to the  determination  dates  that  fall  within  the  same
          calendar year.

     (d)  The accrued  benefit of a participant  other than a key employee shall
          be determined under (1) the method, if any, that uniformly applies for
          accrual  purposes  under all defined  benefit plans  maintained by the
          employer,  or (2) if  there  is no such  method,  as if  such  benefit
          accrued not more rapidly than the slowest accrual rate permitted under
          the fractional rule of Section 411(b)(1)(C) of the Code.

                                   SECTION 19
                    EMPLOYEE STOCK OWNERSHIP PLAN PROVISIONS
                    ----------------------------------------

19.1 EMPLOYEE STOCK OWNERSHIP PROVISIONS OF THE PLAN. This Section 19 sets forth
     special  provisions  applicable to the ESOP component of the Plan. The ESOP
     shall  constitute an employee  stock  ownership  plan within the meaning of
     Section 4975(e)(2) of the Code and Section 407(d)(6) of ERISA, and the ESOP
     shall be  maintained  as a component of the Plan as  authorized by Treasury
     Regulation  Section  54.4975-11(a)(5).  The ESOP shall  hold the  following
     assets:

     (a)  all assets (and earnings  attributable  thereto)  acquired by the ESOP
          with the  proceeds  of any ESOP Loan (as  defined in  Section  19.3(e)
          below) and  maintained  by the ESOP in the ESOP  Suspense  Account (as
          defined  in Section  19.3(g)  below),  the ESOP  Interim  Account  (as
          defined in Section  19.3(d)  below) or allocated  among  participants'
          Employer Accounts (other than  Diversification  Election proceeds that
          are not Employer Securities (as adjusted for investment experience) of
          all participants who have made Diversification Elections);

     (b)  all  assets  (and  earnings  attributable  thereto)  held in the  ESOP
          Payment Account (as defined in Section 19.3(f) below);

     (c)  all  assets  (and  earnings  attributable  thereto)  held by the  ESOP
          component  of the  Pharmacia  Plan  that are  transferred  to the ESOP
          component of this Plan as of the Effective  Date  (including  any such
          assets that were acquired by the ESOP  component of the Pharmacia Plan
          with the proceeds of an ESOP loan that is assumed or refinanced by the
          ESOP  component of this Plan) and held in the ESOP  Suspense  Account,
          ESOP  Interim  Account  or ESOP  Payment  Account or  allocated  among
          participants'  Employer Accounts and all  contributions  (and earnings
          attributable  thereto) made to the Plan on or after the Effective Date
          that are  allocated  to  Employer  Matching  Accounts  (other than the
          portion of participants'  Employer  Accounts invested in the Pharmacia
          Stock Fund or the Chemical  Stock Fund and other than  Diversification
          Election  proceeds that are not Employer  Securities  (as adjusted for
          investment   experience)   of   all   participants   who   have   made
          Diversification Elections); and

     (d)  all other property acquired by the ESOP.

     From time to time the Fund Committee (or an Independent Fiduciary appointed
     for such  purpose)  may  direct  the  Trustee  to enter  into an ESOP  Loan
     pursuant to the  provisions  of this  Section and to use the proceeds of an
     ESOP Loan to acquire common stock of the Company or to repay an ESOP Loan.

     Unless  otherwise   specifically  stated  therein  or  unless  the  context
     otherwise  requires,  all other sections of the Plan apply to the Plan as a
     whole,  and not solely to the ESOP  component or the Savings and Investment
     Plan component of the Plan. The provisions of this section shall  supersede
     contrary provisions of the Plan.

19.2 EFFECTIVE DATE. The ESOP shall be effective as of the Effective Date.

19.3 DEFINITIONS.

     (a)  ALLOCATED DIVIDENDS.  "Allocated  Dividends" shall mean cash dividends
          that are paid during the Plan Year on common stock of the Company held
          by the ESOP  that (i) has been  allocated  to  participants'  Employer
          Accounts and (ii) has been  acquired with the proceeds of an ESOP Loan
          (or  acquired on or after the Spinoff  Date (i) as a spinoff  dividend
          on, or (ii)  pursuant  to the sale or  exchange  described  in Section
          19.8(d) of, shares of common stock of Pharmacia  that were acquired by
          the Pharmacia  Plan with the proceeds of an ESOP loan and  transferred
          to this Plan as of the Effective Date).

     (b)  DISQUALIFIED PERSON.  "Disqualified  Person" shall mean a disqualified
          person within the meaning of Section 4975(e)(2) of the Code.

     (c)  EMPLOYER  CONTRIBUTIONS.   "Employer  Contributions"  shall  mean  all
          Employer Matching Contributions and all Vacation Contributions.

     (d)  ESOP INTERIM  ACCOUNT.  "ESOP Interim  Account" shall mean the account
          described in Section 19.6(b).

     (e)  ESOP LOAN. "ESOP Loan" shall mean a loan described in Section 19.4(a).

     (f)  ESOP PAYMENT  ACCOUNT.  "ESOP Payment  Account" shall mean the account
          described in Section 19.5.

     (g)  ESOP SUSPENSE ACCOUNT.  "ESOP Suspense Account" shall mean the account
          described in Section 19.4(d).

     (h)  FINANCED SHARES.  "Financed  Shares" shall mean shares of common stock
          of the Company acquired by the Plan with the proceeds of the ESOP Loan
          (or  acquired on or after the Spinoff  Date (i) as a spinoff  dividend
          on, or (ii)  pursuant  to the sale or  exchange  described  in Section
          19.8(d) of, shares of common stock of Pharmacia  that were acquired by
          the Pharmacia  Plan with the proceeds of an ESOP loan and  transferred
          to this Plan as of the Effective  Date), or otherwise held as a result
          of conversion or other  disposition  of such shares,  or acquired with
          the proceeds of any indebtedness  previously incurred by the Trust (or
          by the trust under the Pharmacia  Plan),  which is refinanced with the
          proceeds of the ESOP Loan;  PROVIDED  such other  shares are  Employer
          Securities  (as  defined  in  Section  409(l) of the Code)  ("EMPLOYER
          SECURITIES").

     (i)  TRUST  AGREEMENT.  "Trust  Agreement"  shall mean the Monsanto Defined
          Contribution and Employee Stock Ownership Trust  Agreement,  as may be
          amended from time to time.

     (j)  TRUSTEE. "Trustee" shall mean the trustee of the Trust Agreement.

     (k)  UNALLOCATED  DIVIDENDS.   "Unallocated   Dividends"  shall  mean  cash
          dividends  paid on  common  stock  of the  Company  acquired  with the
          proceeds of an ESOP Loan (or acquired on or after the Spinoff Date (i)
          as a spinoff  dividend  on, or (ii)  pursuant  to the sale or exchange
          described in Section  19.8(d) of,  shares of common stock of Pharmacia
          that were acquired by the Pharmacia  Plan with the proceeds of an ESOP
          loan and transferred to this Plan as of the Effective Date) other than
          Allocated Dividends.

19.4 ESOP LOAN.

     (a)  AUTHORITY.  The Fund Committee (or an Independent  Fiduciary appointed
          for this  purpose)  may direct  the  Trustee to obtain an ESOP Loan or
          Loans to finance the  acquisition  of  Financed  Shares or to repay an
          existing ESOP Loan, or to assume or refinance an ESOP loan made to the
          ESOP  component of the  Pharmacia  Plan.  The term "ESOP LOAN" means a
          loan made to the ESOP,  including  a direct  loan of cash,  a purchase
          money  transaction,  or an assumption of an obligation of the ESOP. An
          ESOP Loan may be made by a Disqualified  Person or may be secured by a
          guarantee of a Disqualified Person.  "Guarantee" includes an unsecured
          guarantee  and the  use of the  assets  of a  Disqualified  Person  as
          collateral for an ESOP Loan.

     (b)  CONDITIONS OF LOANS. An ESOP Loan must be primarily for the benefit of
          the participants and their  beneficiaries.  The terms of an ESOP Loan,
          whether or not between independent parties, must, at the time the ESOP
          Loan is made,  be at least as  favorable to the ESOP as the terms of a
          comparable  loan  resulting  from arm's  length  negotiations  between
          independent  parties.  At the time an ESOP Loan is made,  the interest
          rate for the ESOP Loan must not be in excess of a  reasonable  rate of
          interest,  taking  into  account  the amount and  duration of the ESOP
          Loan, the security and guarantee (if any)  involved,  and the interest
          rate prevailing for comparable loans. The term of an ESOP Loan must be
          definitely ascertainable.

     (c)  USE OF LOAN PROCEEDS. The proceeds of an ESOP Loan must be used within
          a reasonable time after their receipt by the ESOP and may be used only
          for one or more of the following purposes:

          (i)  to acquire common stock of the Company,

          (ii) to repay such ESOP Loan, or

          (iii)to repay a prior  ESOP Loan  (including  an ESOP loan made to the
               ESOP   component  of  the  Pharmacia  Plan  that  is  assumed  or
               refinanced by the ESOP component of this Plan).

          Pursuant to terms of the Trust  Agreement,  the Trustee shall purchase
          any shares of common stock of the Company  required  for the ESOP,  or
          cause such  shares to be  purchased,  in the open  market,  by private
          purchase from the Company or any of its Subsidiaries or Affiliates, or
          by other private transactions.

     (d)  ESOP  SUSPENSE  ACCOUNT.  All  assets  acquired  by the ESOP  with the
          proceeds of an ESOP Loan shall be added to and  maintained in the ESOP
          Suspense  Account.  Assets shall be withdrawn  from the ESOP  Suspense
          Account  pursuant  to the  provisions  of  Section  19.6 as though all
          securities in the ESOP Suspense Account were encumbered.

     (e)  LIABILITY  AND  COLLATERAL  FOR LOAN.  An ESOP  Loan  must be  without
          recourse  against  the ESOP.  The only assets of the ESOP which may be
          used as  collateral  on an ESOP Loan are common  stock of the  Company
          acquired  with the  proceeds of the ESOP Loan and common  stock of the
          Company that was used as  collateral  on a prior ESOP Loan  (including
          common  stock of the Company that was received on or after the Spinoff
          Date (i) as a spinoff  dividend  on, or (ii)  pursuant  to the sale or
          exchange  described in Section  19.8(d) of,  common stock of Pharmacia
          that was  acquired  with the proceeds of an ESOP loan made to the ESOP
          component of the  Pharmacia  Plan that is assumed or refinanced by the
          ESOP  component  of this Plan) repaid with the proceeds of the current
          ESOP Loan.

          Except as permitted  pursuant to Section 404(k) of the Code, no person
          entitled to payment  under an ESOP Loan shall have any right to assets
          of the Plan other than:

          (i)  any collateral given for the ESOP Loan,

          (ii) Employer  Contributions  that are made to the ESOP and designated
               to be used to meet its obligations under the ESOP Loan, and

          (iii)earnings  attributable  to such  collateral and the investment of
               such Employer Contributions.

19.5 REPAYMENT OF LOAN; ESOP PAYMENT ACCOUNT.

     (a)  PAYMENTS GENERALLY.  If an ESOP Loan is undertaken,  the Trustee shall
          cause the ESOP to repay the  lender as  payments  on the ESOP Loan are
          required  pursuant to the terms of the ESOP Loan  agreement.  Payments
          shall be made  from the ESOP  Payment  Account.  Except  as  otherwise
          provided  herein,  the ESOP Payment Account shall hold an amount equal
          to:

          (i)  the sum of:

               (A)  Employer Contributions (other than contributions of Employer
                    Securities)  made during or prior to the then  current  Plan
                    Year that are  designated  to be made to the Trust to enable
                    the Trust to meet its obligations under the ESOP Loan; plus,

               (B)  earnings  received  during or prior to the then current Plan
                    Year  on  such  contributions  and  on any  Financed  Shares
                    (including Allocated and Unallocated Dividends); plus,

               (C)  any other assets lawfully available for this purpose;

          (ii) minus, such payments  previously made in the then current and all
               prior Plan Years.

          Allocated  Dividends  that are not used by the end of the Plan Year in
          which received under subparagraph (i)(B) above to make payments on the
          ESOP Loan shall be allocated to participants' Accounts.

          Notwithstanding  the foregoing,  such Allocated  Dividends may be used
          within a  reasonable  time  after  the  close of the Plan Year to make
          payments on the ESOP Loan,  PROVIDED  the  participants'  Accounts are
          then credited with the required amounts under Section 19.6(b)(i).

     (b)  DEFAULT PROVISION. If, at the time a loan payment is required there is
          a  default,  and as a result of the  default,  there are  insufficient
          assets in the ESOP Payment Account to make the required  payment,  and
          under the terms of the ESOP Loan,  the  shares of common  stock of the
          Company held in the ESOP Suspense  Account are pledged as  collateral,
          the Trustee may transfer  shares in the ESOP  Suspense  Account to the
          ESOP  Payment  Account  that are  sufficient,  when added to the other
          assets in the ESOP Payment Account, to make the required loan payment.
          This  provision   shall  be  interpreted   consistent   with  Treasury
          Regulation Section 54.4975-7(b)(6).

     (c)  SALE OF EMPLOYER STOCK IN THE SUSPENSE  ACCOUNT.  If, in circumstances
          permitted under Section 4975 of the Code or ERISA, common stock of the
          Company  held  in  the  ESOP  Suspense  Account  is  sold  and  is not
          reinvested within 120 days in Employer  Securities,  the proceeds from
          such sale shall be transferred  to the ESOP Payment  Account and shall
          be used to satisfy any outstanding obligations under the ESOP Loan (by
          repayment, defeasance or other means). Notwithstanding anything herein
          to the contrary, no proceeds attributable to a sale of Financed Shares
          held by the ESOP Suspense  Account shall be released for allocation to
          a participant's  Employer  Accounts until all  outstanding  ESOP Loans
          have been repaid.

     (d)  EXCESS IN SUSPENSE ACCOUNT. If, at any time after all outstanding ESOP
          Loans have been retired,  assets remain in the ESOP Suspense  Account,
          such assets shall be transferred to an ESOP Interim Account.

     (e)  REFINANCING.  If,  while  one or more  ESOP  Loans is  outstanding,  a
          subsequent ESOP Loan is undertaken to refinance such earlier  loan(s),
          the proceeds of the subsequent  ESOP Loan may be transferred  from the
          ESOP Suspense  Account to the ESOP Payment  Account to the extent such
          transferred  amounts  do not  exceed  the  outstanding  balance on the
          earlier  ESOP  Loan(s),  and such  amount  shall be used to retire the
          prior ESOP Loan(s).  Refinancing of the earlier ESOP Loan(s) shall not
          cause a release of shares from the ESOP Suspense Account under Section
          19.6 below.

     (f)  INVESTMENT OF ASSETS HELD IN ESOP PAYMENT ACCOUNT.  Assets held in the
          ESOP Payment  Account shall be invested in a manner that is consistent
          with the provisions of the Trust Agreement.

19.6 RELEASE FROM SUSPENSE ACCOUNT AND ALLOCATION AMONG PARTICIPANTS' ACCOUNTS.

     (a)  ANNUAL  RELEASE FROM SUSPENSE  ACCOUNT.  With respect to any Plan Year
          for which one or more  payments  are made on an ESOP Loan  pursuant to
          Section 19.5(a) (other than by reason of Section  19.5(e)),  including
          any payment on an ESOP Loan that is made  following  the close of such
          Plan Year (but on or before the time  prescribed by law for filing the
          Employer's  federal  income  tax  return  for  that  year,   including
          extensions  thereof) and is  designated  as being made with respect to
          such  Plan  Year,  shares  of  common  stock of the  Company  shall be
          released from the ESOP Suspense Account in accordance with the General
          Rule or the Special Rule, as determined with respect to each ESOP Loan
          by the Fund  Committee  at the time the ESOP Loan is taken out. If the
          Fund  Committee does not specify which rule is to be used, the General
          Rule shall be used.

          (i)  GENERAL  RULE.  Under  the  General  Rule,  the  number of shares
               released  for the Plan Year is equal to the number of shares held
               in the ESOP Suspense  Account  immediately  before the payment(s)
               multiplied by a fraction,  the numerator of which is equal to the
               total amount of loan payments made with respect to such Plan Year
               and the denominator of which is equal to the sum of the numerator
               and the principal and interest  expected to be paid in all future
               Plan Years.  If the  collateral  includes  more than one class of
               stock of the  Company,  the  number of shares of each class to be
               released for a Plan Year shall be determined by applying the same
               fraction  to each  class.  If,  pursuant  to the terms of an ESOP
               Loan,  loan  payments  are to be made  other than  annually,  the
               formulae set forth above shall be adjusted in a manner consistent
               with the General  Rule so as to take into  account the  frequency
               and  timing  of  the  loan  payments  and  the  other  terms  and
               conditions of the ESOP Loan.

          (ii) SPECIAL  RULE.  The  Special  Rule is based  solely on  principal
               payments as follows:

               The number of shares released from the ESOP Suspense  Account for
               the Plan Year shall equal the total number of such shares held in
               the ESOP  Suspense  Account  immediately  prior  to the  release,
               multiplied by a fraction:

               (A)  the  numerator  of the  fraction is the amount of  principal
                    paid for the Plan Year; and

               (B)  the  denominator of the fraction is the sum of the numerator
                    plus the principal to be paid for all future Plan Years.

               The Fund  Committee  may apply the Special  Rule only if the ESOP
               Loan provides for annual  payments of principal and interest at a
               cumulative  rate  which is not less  rapid at any time than level
               annual  payments of such  amounts for ten years,  and only if the
               interest  included  in any payment is  disregarded  to the extent
               that it would be  determined to be interest  under  standard loan
               amortization  tables.  The Special  Rule shall not be  applicable
               from  the  time  that,  by  reason  of a  renewal,  extension  or
               refinancing,  the sum of the  expired  duration of the ESOP Loan,
               the renewal  period,  the extension  period and the duration of a
               new ESOP Loan exceeds ten years.

          (iii)In  determining  the number of shares to be released for any Plan
               Year under either the General Rule or the Special Rule:

               (A)  the  number  of  future  years  under  the ESOP Loan must be
                    definitely  ascertainable  and  must be  determined  without
                    taking  into  account  any  possible  extensions  or renewal
                    periods; and

               (B)  if the ESOP Loan provides for a variable  interest rate, the
                    interest  to be  paid  for all  future  Plan  Years  must be
                    computed by using the interest rate applicable as of the end
                    of the Plan Year for which the determination is being made.

     (b)  ALLOCATION OF RELEASED SHARES.

          Financed  Shares  shall  be  allocated  to the  Employer  Accounts  of
          participants as follows:

          (i)  DIVIDEND REPLACEMENT ALLOCATION.  If Allocated Dividends are used
               to make  payments on an ESOP Loan,  released  common stock of the
               Company (and, if applicable, additional shares of common stock of
               the  Company  contributed  by the  Company  or  purchased  by the
               Trustee  using cash  contributions)  having a fair  market  value
               equal to the  amount of the  Allocated  Dividends  used in making
               such payments on the ESOP Loan shall be allocated to the Employer
               Matching  Accounts of participants in proportion to the shares of
               common stock of the Company credited to each account with respect
               to which  Allocated  Dividends  have been  paid.  Notwithstanding
               anything herein to the contrary,  if Allocated Dividends are used
               to repay an ESOP Loan,  the Accounts  which are affected shall be
               put in the same  position as a result of this  section as if such
               dividends had been  immediately  used to acquire  common stock of
               the Company.

          (ii) EMPLOYER  CONTRIBUTIONS WITH RESPECT TO FINANCED SHARES After the
               application of subparagraph (i) above,  remaining released shares
               of  common  stock  of  the  Company  shall  be  allocated   among
               participants' Employer Accounts in the same manner and amounts as
               if they were (A) Employer  Matching  Contributions  (described in
               Section  6) or  (B)  Vacation  Contributions.  Employer  Matching
               Contribution  allocations under this subparagraph (ii) shall take
               precedence  over  Section  6,  and  allocations  hereunder  shall
               reduce,  dollar for dollar, the amount of Employer  Contributions
               required in Section 6.

          (iii) ESOP Interim Account.

               (A)  RELEASE   IN  EXCESS  OF  (B)(i)  AND   (B)(ii)   ALLOCATION
                    REQUIREMENTS.  If, at any time  during  the Plan  Year,  the
                    value of shares  released from the Suspense  Account exceeds
                    the amount of the dividend replacement  allocation described
                    in subparagraph  (b)(i) above and the amount in subparagraph
                    (b)(ii)  above,  such excess  shares  shall be placed in the
                    ESOP Interim Account.

               (B)  RELEASE  INSUFFICIENT TO COVER (B)(I) AND (B)(II) ALLOCATION
                    REQUIREMENTS.  If the value of shares  released is less than
                    the amount required under subparagraphs  (b)(i) and (b)(ii),
                    amounts shall be removed from the ESOP Interim  Account,  to
                    the  extent  available,  to satisfy  the (b)(i) and  (b)(ii)
                    requirements.  Effective  January 1, 1992,  if the assets in
                    the ESOP Interim Account are insufficient  when added to the
                    value of shares released to satisfy the dividend replacement
                    allocation  of (b)(i)  or the  contribution  requirement  of
                    (b)(ii),  the necessary  number of shares of common stock of
                    the Company may be released from the ESOP  Suspense  Account
                    and added to the ESOP Interim  Account;  PROVIDED,  HOWEVER,
                    the  cumulative  number of shares  released shall not exceed
                    the number that would  otherwise  be released by the payment
                    of the  remaining  ESOP Loan  payments  projected to be made
                    during the  remainder of the Plan Year,  and the shares that
                    are released from the ESOP  Suspense  Account in this manner
                    shall be  credited  toward the number of shares that must be
                    released  pursuant  to  this  section  once  the  ESOP  Loan
                    payments  for the  remainder  of the Plan Year are  actually
                    made.  In  the  alternative  or as a  supplement,  the  Fund
                    Committee  may direct  that the  Employer(s)  contribute  an
                    amount  sufficient  to  cover  the  shortfall  or an  amount
                    sufficient  to  make a loan  payment  that  will  cause  the
                    release of sufficient shares to cover the shortfall.

               (C)  EXCESS REMAINING IN ESOP INTERIM ACCOUNT. If, as of the last
                    day of the Plan Year  after the  allocation  of all  amounts
                    described in subparagraphs (b)(i) and (b)(ii), there remains
                    assets in the ESOP  Interim  Account,  such assets  shall be
                    allocated   among  the   Employer   Matching   Accounts   of
                    participants who are employed by an Employer on the last day
                    of such Plan Year in the same  proportion  as the  amount of
                    Employer   Matching   Contributions   described  in  Section
                    6.1(a)(i)  for  each  such  participant  for the  Plan  Year
                    (including,  with  respect to the Plan Year ending  December
                    31,  2001,  employer  matching  contributions  described  in
                    section  6.1(a)(i)  of the  Pharmacia  Plan  for the  period
                    commencing  on January  1, 2001 and ending on the  Effective
                    Date)  bears  to  the  total  amount  of  Employer  Matching
                    Contributions  described in Section  6.1(a)(i)  for all such
                    participants for the Plan Year  (including,  with respect to
                    the Plan Year ending  December 31, 2001,  employer  matching
                    contributions   described   in  section   6.1(a)(i)  of  the
                    Pharmacia Plan for the period  commencing on January 1, 2001
                    and ending on the  Effective  Date).

19.7 PROCEEDS OF ESOP LOANS.  The  proceeds of each ESOP Loan shall be placed in
     the ESOP  Suspense  Account  and, as soon as  practicable,  shall be either
     invested in common  stock of the Company or used to repay an ESOP Loan.  No
     common stock of the Company  acquired with the proceeds of an ESOP Loan may
     be subject to a put, call, or other option, or buy-sell, except for the put
     option described in Section 19.10 below, or similar  arrangement while held
     by and when distributed  from the Plan,  whether or not the Plan is then an
     ESOP within the meaning of Section 4975(e)(7) of the Code.

19.8 ACQUISITION AND DISPOSITION OF COMMON STOCK OF THE COMPANY.

     (a)  GENERAL.  Any  purchase of common  stock of the Company by the Trustee
          shall be made at a price  which is not in  excess  of its fair  market
          value and any sale of common  stock of the Company  shall be made at a
          price which is not less than its fair market value. The Fund Committee
          may  direct  the  Trustee  to buy from,  or sell  common  stock of the
          Company to, any person, subject to paragraph (b) below.

     (b)  TRANSACTION WITH  DISQUALIFIED  PERSON. In the case of any transaction
          involving  the  transfer of common  stock of the  Company  between the
          Trustee and a Disqualified Person, or any transaction involving common
          stock of the  Company  which is subject to ERISA  Section  406(b),  no
          commission  shall be charged with respect to the  transaction  and the
          transaction shall be for adequate consideration (within the meaning of
          ERISA Section 3(18)).

     (c)  EXPENSES.  No expense relating to the  implementation of an ESOP shall
          be charged to the Plan.

     (d)  SALE OR EXCHANGE OF COMMON STOCK OF PHARMACIA FOLLOWING SPINOFF.  Upon
          the direction of an Independent  Fiduciary appointed for this purpose,
          all of the  shares  of  common  stock  of  Pharmacia  held in the ESOP
          Suspense  Account  and the  ESOP  Interim  Account  shall,  as soon as
          possible  following  the Spinoff  Date as is  consistent  with prudent
          investment standards as determined by such Independent  Fiduciary,  be
          sold (or  exchanged for shares of common stock of the Company) and the
          proceeds of such shares  shall be applied to the purchase of shares of
          common stock of the Company  which shall be held in the ESOP  Suspense
          Account or ESOP Interim Account until  allocated  among  participants'
          Employer Accounts in accordance with this Section 19.

19.9 EMPLOYER CONTRIBUTIONS TO RETIRE DEBT. The Company shall make (or cause the
     other Employers to make) cash contributions to the Trust on or prior to the
     date on which a  payment  with  respect  to any  outstanding  ESOP  Loan is
     scheduled  to  become  due.  The  amount of such  contribution(s)  shall be
     sufficient,  when added to  earnings  received  on such  contributions  and
     earnings  (including  Allocated and/or  Unallocated  Dividends) on Financed
     Shares,  together with any other assets of the Trust lawfully available for
     this purpose, to timely make such payments. Unless the Company shall itself
     make  payments  to satisfy  the  Trust's  payment  obligations  directly to
     whomever  shall be entitled to such  payments,  the Company  also agrees to
     make  (or  cause  the  other   Employers  to  make)  such  additional  cash
     contributions  to the  Trust as may be  necessary  to  enable  the Trust to
     timely  satisfy its other  payment  obligations  thereunder,  except to the
     extent inconsistent with the requirements of ERISA or the Code.

     Except as provided in Section 19.5(c),  if the payments on an ESOP Loan may
     be  accelerated at the election of the borrower,  the Fund Committee  shall
     have sole  discretion to direct the Trustee to  accelerate  repayment of an
     ESOP Loan.

19.10 PUT OPTION.  If at the time of  distribution, common  stock of the Company
     distributed from the ESOP is not readily tradable on an established  market
     (within  the  meaning of Section  409(h) of the Code),  such stock shall be
     subject  to a put option in the hands of a  Qualified  Holder by which such
     Qualified  Holder may sell all or any part of the stock  distributed to him
     from the ESOP to the  Company.  The put  option  shall  be  subject  to the
     following conditions:

     (a)  QUALIFIED  HOLDER.   The  term  "Qualified   Holder"  shall  mean  the
          participant or beneficiary  receiving the  distribution of such stock,
          or any other  party to whom such  stock is  transferred  by gift or by
          reason of death.

     (b)  INITIAL TERM.  During the 60-day period  following any distribution of
          such  stock,  a Qualified  Holder  shall have the right to require the
          Company to purchase all or a portion of the distributed  stock held by
          the Qualified Holder. The purchase price to be paid for any such stock
          shall be its fair market  value  determined  (i) as of the  Accounting
          Date  coinciding with or next preceding the exercise of the put option
          under this paragraph (b) or (ii) in the case of a transaction  between
          the Plan and a  Disqualified  Person or a "party in interest"  (within
          the  meaning  of  Section  3(14)  of  ERISA),  as of the  date  of the
          transaction.

     (c)  SUBSEQUENT  TERM. If a Qualified Holder shall fail to exercise his put
          option  right  under   Section   19.10(b),   the  option  right  shall
          temporarily lapse upon the expiration of the 60-day period. As soon as
          practicable  following  the  last day of the  Plan  Year in which  the
          60-day   option   period   expires,   the  Company  shall  notify  the
          non-electing  Qualified Holder (if he is then a shareholder of record)
          of the  valuation  of the stock as of that  date.  During  the  60-day
          period  following  receipt of such  valuation  notice,  the  Qualified
          Holder  shall  again have the right to require the Company to purchase
          all or any portion of the distributed  stock. The purchase price to be
          paid therefor shall be its fair market value  determined (i) as of the
          Accounting  Date coinciding with or next preceding the exercise of the
          put  option  under  this  paragraph  (c)  or  (ii)  in the  case  of a
          transaction  between the Plan and a Disqualified Person or a "party in
          interest"  (within the meaning of Section  3(14) of ERISA),  as of the
          date of the transaction.

     (d)  TRUSTEE'S  PURCHASE  RIGHTS.  The  Trustee may be  permitted,  but not
          required,  by the  Company to  purchase  such stock put to the Company
          under a put option.

     (e)  EXCEPTION  TO TERM LIMITS.  The period  during which the put option is
          exercisable  does not  include  any time  when a  Qualified  Holder is
          unable to exercise it because the Company is prohibited  from honoring
          it by applicable federal or state laws.

     (f)  EFFECT  OF CODE AND  REGULATIONS.  Except  as  otherwise  required  or
          permitted  by the Code,  the put  options  under  this  Section  shall
          satisfy  the  requirements  of Section  54.4975-7(b)  of the  Treasury
          Regulations  to the extent,  if any, that such  requirements  apply to
          such put options.  Nothing in this Section 19.10 shall be  interpreted
          as  providing  a  Qualified  Holder  with  rights  greater  than those
          required under the Code and applicable Treasury Regulations.

     (g)  EXERCISE.  A Qualified  Holder must exercise his put option in writing
          to the Company.  If a Qualified  Holder exercises his put option under
          this Section,  payment for the stock repurchased shall be made, in the
          case of a distribution  of a  participant's  entire account within one
          taxable year,  in  substantially  equal annual  payments over a period
          beginning  not later than 30 days after the exercise of the put option
          and not exceeding  five years  (provided  that  adequate  security and
          reasonable  interest are provided with respect to unpaid  amounts) or,
          in the case of other distributions,  not later than 30 days after such
          exercise.

     (h)  SURVIVAL OF PUT OPTION RIGHT.  To the extent  required  under the Code
          and applicable  Treasury  Regulations,  the provisions of this Section
          shall continue to apply to shares of common stock,  whether or not the
          Plan is then an ESOP within the meaning of Section  4975(e)(7)  of the
          Code.

19.11 VALUATION.  All  valuations of common  stock of the Company  which are not
     readily  tradable on an established  securities  market shall be made by an
     independent  appraiser meeting  requirements similar to the requirements of
     the regulations prescribed under Section 170(a)(1) of the Code.

19.12 FORFEITURE RULE.  If a  participant  forfeits  some  portion  of his  ESOP
     benefits (allocated pursuant to the provisions of this Section), and if any
     of the benefits  attributable to his ESOP benefits consists of assets other
     than common stock of the Company ("OTHER  ASSETS"),  such forfeiture  shall
     apply  first to Other  Assets,  and,  thereafter,  to  common  stock of the
     Company.

19.13 DIVIDENDS PAID ON COMMON STOCK OF THE COMPANY OTHER THAN FINANCED  SHARES.
     The  dividends  paid on the common stock of the Company other than Financed
     Shares held by the ESOP shall be invested by the Trustee.

19.14 CHANGES IN ALLOCATION AND FORFEITURE FORMULAE.  To the extent necessary to
     comply with Rule 16b-3 of the Securities Exchange Act of 1934, the formulae
     for the release of Financed Shares from the ESOP Suspense Account set forth
     in Section 19.6 above and the formulae for the  allocation  of  forfeitures
     set forth in  Section 6 above may not be  amended  more than once every six
     months,  other than to comport with changes in or requirements of the Code,
     ERISA or the rules thereunder.

19.15 STATUS  OF  DELEGATES.  The  Fund Committee,  as a  Named  Fiduciary,  may
     delegate  its  authority,  duties and  responsibilities  to other  persons,
     including  the  Company  and its  officers,  employees  or  agents.  Such a
     delegation shall be in writing and specify the identity of the delegate and
     the  responsibilities  delegated  to such person.  When the Fund  Committee
     makes such a delegation  designating  the delegate as a Named Fiduciary and
     pursuant to the delegation, the delegate issues instructions to the Trustee
     concerning the administration and operation of the ESOP, the delegate shall
     also constitute a Named Fiduciary.

                                   SECTION 20
                                  DEFINITIONS
                                  -----------

20.1 ACCOUNTING DATE. See Section 1.6.

20.2 ACCOUNTS.  "Accounts" shall mean the accounts  maintained on behalf of each
     participant  including  Participant Accounts (described in Section 8.1) and
     Employer Accounts (described in Section 8.2).

20.3 AFFILIATE. "Affiliate" shall mean:

     (a)  a corporation  that is a member of a controlled  group of corporations
          (within  the meaning of Section  414(b) of the Code) that  includes an
          Employer;

     (b)  a trade or business (whether or not incorporated) that is under common
          control  (within  the  meaning of Section  414(c) of the Code) with an
          Employer;

     (c)  an organization  (whether or not incorporated)  that is a member of an
          affiliated  service group (within the meaning of Section 414(m) of the
          Code) that includes an Employer; or

     (d)  any other entity required to be aggregated  with an Employer  pursuant
          to regulations issued under Section 414(o) of the Code.

20.4 AFTER-TAX ACCOUNTS.  "After-Tax  Accounts" shall mean, with respect to each
     participant,  such participant's Matched After-Tax Account and Supplemental
     After-Tax Account.

20.5 AFTER-TAX CONTRIBUTIONS. See Section 5.1.

20.6 ALLOCATED DIVIDENDS. See Section 19.3(a).

20.7 ANNUAL ADDITIONS. See Section 7.3(a).

20.8 BEFORE-TAX ACCOUNTS. "Before-Tax Accounts" shall mean, with respect to each
     participant, such participant's Matched Before-Tax Account and Supplemental
     Before-Tax Account.

20.9 BEFORE-TAX CONTRIBUTIONS. See Section 4.1.

20.10 BREAK IN SERVICE.  "Break  in  Service"  shall  mean with  respect  to any
     employee  the sum of (a) any Break in  Service  under the  Pharmacia  Plan,
     NutraSweet  CAP and Searle CAP as of December 31, 1996,  and (b) the period
     of time  commencing on the later of January 1, 1997 or the first day of the
     month following the  participant's  Separation Date and ending on the first
     day of the month  containing the  participant's  Reemployment  Commencement
     Date.

     Prior to 1997, a one-year  "Break in Service" means a Plan Year in which an
     employee  completes  not more than 500 Hours of Service,  except where such
     Plan Year is the year in which the employee either:

     (a)  First commenced  employment with an Employer and continuously  accrued
          Hours of  Service  from the date of hire to the end of such Plan Year;
          or

     (b)  Terminated  all further  employment  with the  Employers  following an
          unbroken,  continuous  accrual of Hours of Service  from  January 1 of
          such Plan  Year to the date of such  termination;  provided,  however,
          that this  paragraph  (ii) shall not be  applicable  for  purposes  of
          Section 10.3.

     Effective for absences which  commence on or after January 1, 1985,  solely
     for the  purpose of  determining  whether any one year Break in Service has
     occurred,  Hours of Service will be credited  pursuant to the normal method
     of  crediting  Hours of Service  under this Plan not to exceed 501 Hours of
     Service due to any period of absence from  employment due to a Maternity or
     Paternity Absence. The Hours of Service to be credited under this paragraph
     shall only be credited in the Plan Year in which such absence begins,  if a
     participant  would be prevented  from incurring a one year Break in Service
     solely  because the period of absence is treated as Hours of Service or, in
     any other case, in the immediately  following Plan Year. No credit for such
     enumerated  absences shall be given  pursuant to this paragraph  unless the
     participant  furnishes to the Plan Committee such timely information as the
     Committee may  reasonably  require to establish  reason for, and the length
     of, the absence.

20.11 CHANGE OF CONTROL. "Change of Control" shall mean:

     (a)  The acquisition by any individual, entity or group (within the meaning
          of Section  13(d)(3)  or 14(d)(2) of the  Securities  Exchange  Act of
          1934,  as amended (the  "EXCHANGE  ACT")) (a  "PERSON") of  beneficial
          ownership  (within  the  meaning of Rule 13d-3  promulgated  under the
          Exchange Act) of 20% or more of either (I) the then outstanding shares
          of  common  stock of the  Company  (the  "OUTSTANDING  COMPANY  COMMON
          STOCK")  or (II) the  combined  voting  power of the then  outstanding
          voting  securities  of the Company  entitled to vote  generally in the
          election of directors (the "OUTSTANDING VOTING SECURITIES"); PROVIDED,
          HOWEVER,  that,  for  purposes  of  this  subsection,   the  following
          acquisitions  shall  not  constitute  a  Change  of  Control:  (I) any
          acquisition  directly from the Company,  (II) any  acquisition  by the
          Company or a Subsidiary, (III) any acquisition by any employee benefit
          plan (or related  trust)  sponsored or  maintained by the Company or a
          Subsidiary or (IV) any  acquisition by any  corporation  pursuant to a
          transaction which complies with clauses (I), (II) and (III) of Section
          20.11(c); or

     (b)  Individuals  who,  as of the  Spinoff  Date,  constitute  the Board of
          Directors of the Company (the "INCUMBENT  BOARD") cease for any reason
          to  constitute  at least a majority of the Board of  Directors  of the
          Company;  PROVIDED,  HOWEVER,  that any individual becoming a director
          subsequent  to the Spinoff  Date whose  election,  or  nomination  for
          election by the Company's  shareholders,  was approved by a vote of at
          least a majority of the directors then  comprising the Incumbent Board
          shall be  considered  as though such  individual  were a member of the
          Incumbent Board, but excluding,  for this purpose, any such individual
          whose initial  assumption of office occurs as a result of an actual or
          threatened election contest with respect to the election or removal of
          directors or other  actual or  threatened  solicitation  of proxies or
          consents by or on behalf of a Person other than the Board of Directors
          of the Company; or

     (c)  Consummation   by  the   Company  of  a   reorganization,   merger  or
          consolidation or sale or other disposition of all or substantially all
          of the assets of the Company or the  acquisition of assets or stock of
          another corporation (a "BUSINESS COMBINATION"),  in each case, unless,
          following such Business  Combination,  (I) all or substantially all of
          the  individuals   and  entities  who  were  the  beneficial   owners,
          respectively,  of the Outstanding Company Common Stock and Outstanding
          Voting  Securities  immediately  prior  to such  Business  Combination
          beneficially   own,   directly  or  indirectly,   more  than  60%  of,
          respectively,  the then  outstanding  shares of  common  stock and the
          combined  voting  power  of the  then  outstanding  voting  securities
          entitled to vote  generally in the election of directors,  as the case
          may be, of the  corporation  resulting from such Business  Combination
          (including,  without  limitation,  a corporation  which as a result of
          such transaction  owns the Company or all or substantially  all of the
          Company's assets either directly or through one or more  subsidiaries)
          in substantially the same proportions as their ownership,  immediately
          prior to such Business  Combination of the Outstanding  Company Common
          Stock and Outstanding Voting  Securities,  as the case may be, (II) no
          Person (excluding the Company, a Subsidiary, any corporation resulting
          from  such  Business  Combination  or any  employee  benefit  plan (or
          related trust) thereof) beneficially owns, directly or indirectly, 20%
          or  more  of the  then  outstanding  shares  of  common  stock  of the
          corporation resulting from such Business Combination or 20% or more of
          the combined voting power of the then  outstanding  voting  securities
          entitled  to vote  generally  in the  election  of  directors  of such
          corporation, except to the extent that such ownership existed prior to
          the Business  Combination and (III) at least a majority of the members
          of the  board of  directors  of the  corporation  resulting  from such
          Business  Combination  were members of the Incumbent Board at the time
          of the  execution  of the initial  agreement,  or of the action of the
          board, providing for such Business Combination; or

     (d)  Approval by the shareholders of the Company of a complete  liquidation
          or dissolution of the Company.

20.12 CHEMICAL STOCK FUND. See Section 9.2(h).

20.13 CODE.  The Internal Revenue Code of 1986, as amended from time to time, or
     any  comparable  section or sections  of future  legislation  that  amends,
     supplements,  or  supersedes  any  applicable  provision  of said  Internal
     Revenue Code or any applicable regulations or court decisions thereunder.

20.14 COMPANY.  "Company" shall mean Monsanto  Company,  a Delaware  corporation
     which was  incorporated  on  February  9, 2000 under the name  Monsanto  Ag
     Company and which changed its name to Monsanto Company on March 31, 2000.

20.15 COMPANY STOCK FUND. See Section 9.2(b).

20.16 COMPENSATION. See Sections 7.3(d) and 18.7.

20.17 CONTRIBUTION PERCENTAGE. See Section 7.3(e).

20.18 CONTRIBUTION PERCENTAGE AMOUNTS. See Section 7.3(f).

20.19 DEFINED CONTRIBUTION PLANS. See Section 7.3(c).

20.20 DIRECT ROLLOVER ACCOUNT. See Section 8.1(e).

20.21 DIRECT ROLLOVER CONTRIBUTIONS. See Section 3.5.

20.22 DISABILITY. See Section 20.23.

20.23 DISABLED.  An employee shall be  considered  to be  "Disabled"  or to have
     incurred  "Disability"  for  purposes  of this Plan if he has been  deemed,
     under the terms of the applicable  disability income plan maintained by his
     Employer  at the time the  participant  ceases to  perform  services  as an
     active Employee,  to be totally and permanently  disabled or to be disabled
     for any occupation, as the case may be.

20.24 DISCRETIONARY MATCHED CONTRIBUTIONS. See Section 6.1(a)(ii).

20.25 DISQUALIFIED PERSON. See Section 19.3(b).

20.26 DIVERSIFICATION ELECTION. See Section 9.5(b).

20.27 EFFECTIVE DATE. See Section 1.5.

20.28 ELIGIBLE EARNINGS. See Section 4.5.

20.29 EMPLOYEE STOCK ACCOUNT. See Section 8.3.

20.30 EMPLOYER.  "Employer"  shall  mean  the  Company  and  each  Affiliate  or
     Subsidiary  which,  with the  consent  of the  Company,  adopts the Plan in
     accordance with the provisions of Section 14.2.

20.31 EMPLOYER ACCOUNTS.  "Employer  Accounts"  shall mean, with respect to each
     participant,  such  participant's  Employer  Matching  Account and Vacation
     Account.

20.32 EMPLOYER CONTRIBUTIONS.   "Employer  Contributions"  shall  mean  Employer
     Matching Contributions and Vacation Contributions, including, to the extent
     provided in Section 6.3, correcting contributions.

20.33 EMPLOYER MATCHING ACCOUNT. See Section 8.2(a).

20.34 EMPLOYER MATCHING CONTRIBUTIONS. See Section 6.1.

20.35 EMPLOYER SECURITIES. See Section 19.3(h).

20.36 EMPLOYMENT COMMENCEMENT  DATE.  The term  "Employment  Commencement  Date"
     shall mean the later of January 1, 1997 or the date the  employee  is first
     credited with an Hour of Service.

20.37 ERISA. Public Law 93-406,  the Employee  Retirement Income Security Act of
     1974, as amended from time to time, or any  comparable  section or sections
     of  future  legislation  that  amends,   supplements,   or  supersedes  any
     applicable provisions of ERISA or any other applicable regulations or court
     decisions thereunder.

20.38 ESOP. "ESOP" shall mean the Employee Stock Ownership Plan component of the
     Plan, the provisions of which are set forth in Section 19.

20.39 ESOP INTERIM ACCOUNT. See Section 19.3(d).

20.40 ESOP LOAN. See Section 19.3(e).

20.41 ESOP PAYMENT ACCOUNT. See Section 19.3(f).

20.42 ESOP SUSPENSE ACCOUNT. See Section 19.3(g).

20.43 EXCESS AGGREGATE CONTRIBUTIONS. See Section 7.3(g).

20.44 EXCESS BEFORE-TAX CONTRIBUTIONS. See Section 7.3(h).

20.45 EXTENDED GROUP. See Section 7.3(b).

20.46 FINANCED SHARES. See Section 19.3(h).

20.47 FISCAL YEAR. "Fiscal  Year" shall mean,  as applied to any  Employer,  the
     taxable year of that Employer for federal income tax purposes.

20.48 FIVE-YEAR BREAK IN SERVICE.  "Five Year Break in Service"  shall mean five
     or more consecutive one year Breaks in Service.

20.49 FORFEITURES. See Section 10.3(a).

20.50 FORMER PHARMACIA PARTICIPANT. See Section 2.1.

20.51 FUND COMMITTEE. "Fund  Committee" shall mean the Pension and Savings Funds
     Investment  Committee  appointed  by the  Company,  having  the  power  and
     authority described in Section 1.4 and in the Trust Agreement.

20.52 HIGHLY COMPENSATED EMPLOYEE. See Section 7.3(i).

20.53 HOUR OF SERVICE. See Section 2.2(c).

20.54 INCENTIVE PAY. See Section 4.5.

20.55 INDEPENDENT FIDUCIARY. See Section 1.4.

20.56 INSURANCE COMPANY.  "Insurance  Company"  shall mean one or more insurance
     companies  selected  by the  Fund  Committee  to  issue  contracts  for the
     investment of Trust Fund assets.

20.57 INVESTMENT FUNDS. See Section 9.2.

20.58 INVESTMENT MANAGER. "Investment Manager" shall mean one or more investment
     managers  selected by the Fund  Committee to manage the investment of Trust
     Fund assets.

20.59 LAYOFF. "Layoff" shall mean layoff of the participant from employment with
     an Employer.

20.60 LEASED EMPLOYEE.  "Leased  Employee"  shall  mean any leased  employee  as
     defined in Section 414(n)(2) of the Code.

20.61 LOAN ACCOUNTS. See Section 9.3.

20.62 LOAN FUND. See Section 9.3.

20.63 LOAN PROCEDURES. See Section 12.1.

20.64 MATCHED AFTER-TAX ACCOUNT. See Section 8.1(c).

20.65 MATCHED AFTER-TAX CONTRIBUTIONS. See Section 5.2.

20.66 MATCHED BEFORE-TAX ACCOUNT. See Section 8.1(a).

20.67 MATCHED BEFORE-TAX CONTRIBUTIONS. See Section 4.2.

20.68 MATERNITY OR PATERNITY ABSENCE.  "Maternity  or Paternity  Absence"  shall
     mean any absence due to  pregnancy of the  individual;  birth of a child of
     the individual; placement of a child with the individual in connection with
     the adoption of such child by such individual; or caring for such child for
     a period beginning immediately following such birth or placement.

20.69 NORMAL RETIREMENT AGE. The term "Normal Retirement Age" shall mean age 65.

20.70 NUTRASWEET CAP. See Section 1.1.

20.71 PARTICIPANT ACCOUNTS.  "Participant  Accounts" shall mean, with respect to
     each  participant,   such   participant's   Matched   Before-Tax   Account,
     Supplemental  Before-Tax Account,  Matched After-Tax Account,  Supplemental
     After-Tax Account and Direct Rollover Account.

20.72 PHARMACIA.  "Pharmacia"  shall  mean  Pharmacia  Corporation,  a  Delaware
     corporation (prior to March 31, 2000 known as Monsanto Company).

20.73 PHARMACIA STOCK FUND. See Section 9.2(i).

20.74 PLAN. "Plan" shall mean the Monsanto  Savings and Investment  Plan, as set
     forth herein and as from time to time amended.

20.75 PLAN COMMITTEE. "Plan  Committee"  shall mean the Employee  Benefits Plans
     Committee appointed pursuant to Section 13.

20.76 PLAN YEAR. "Plan Year" shall mean the calendar  year;  provided,  however,
     for fiscal reporting purposes, the first Plan Year of the Plan shall be the
     short Plan Year commencing on June 11, 2001 and ending December 31, 2001.

20.77 PREDECESSOR COMPANY. See Section 2.2(g).

20.78 PRE-MIXED PORTFOLIO.  The term "Pre-Mixed  Portfolio"  means an investment
     portfolio under the Plan that (a) is invested in established proportions of
     the  Investment  Funds (other than the Company  Stock  Fund),  (b) has been
     approved  by the  Funds  Committee  and  (c) is  offered  as an  investment
     alternative  under the Plan.  Each Pre-Mixed  Portfolio shall be rebalanced
     periodically  to maintain the established  proportional  investments in the
     respective Investment Funds (other than the Company Stock Fund).

20.79 QDRO. See Section 8.11.

20.80 QUALIFIED MATCHING CONTRIBUTIONS. See Section 7.3(j).

20.81 QUALIFIED NON-ELECTIVE CONTRIBUTIONS. See Section 7.3(k).

20.82 REEMPLOYMENT COMMENCEMENT DATE. The term "Reemployment  Commencement Date"
     shall  mean the  first  day  following  a Break  in  Service  on which  the
     participant is credited with an Hour of Service.

20.83 REGULAR ACCOUNTING DATE. See Section 1.6.

20.84 REQUIRED BEGINNING DATE. See Section 10.4(c).

20.85 RESTATEMENT DATE. See Section 1.5.

20.86 SEARLE CAP. See Section 1.1.

20.87 SEPARATION DATE. An employee's  "Separation  Date" shall be the earlier of
     the following to occur after December 31, 1996:

     (a)  the date the employee retires,  dies or terminates employment with all
          Employers, Affiliates and Subsidiaries;

     (b)  the second anniversary of the first day of the employee's Maternity or
          Paternity Absence; or

     (c)  the first  anniversary of the first day of the employee's  absence for
          any other reason.

     The period between the first and second  anniversary of the first day of an
     employee's Maternity or Paternity Absence shall not be counted for purposes
     of determining an employee's Years of Service or his Breaks in Service.

20.88 SPECIAL ACCOUNTING DATE. See Section 1.6.

20.89 SPINOFF DATE. See Section 1.1.

20.90 STANDARD WORK  WEEK AND  YEAR.  With  respect  to any  regular,  full-time
     employee  covered under the Plan,  his  "Standard  Work Week" shall mean 40
     Hours of Service  and the  "Standard  Work Year"  shall mean 2,080 Hours of
     Service.  With  respect  to  employees  who  are  not  regular,   full-time
     employees,  the "Standard Work Week" shall mean the average number of hours
     which are regularly  scheduled to be worked each week by the employee,  and
     the "Standard Work Year" for such employees  shall mean the number of hours
     in the employee's Standard Work Week multiplied by 52.

20.91 SUBSIDIARY.  A "Subsidiary" is any subsidiary or affiliate of the Company,
     50  percent  of  the  stock  of  which  is  controlled  by the  Company  by
     application of the attribution  rules of Sections 414(b) and 1563(a) of the
     Code.

20.92 SUPPLEMENTAL AFTER-TAX ACCOUNT. See Section 8.1(d).

20.93 SUPPLEMENTAL AFTER-TAX CONTRIBUTIONS. See Section 5.3.

20.94 SUPPLEMENTAL BEFORE-TAX ACCOUNT. See Section 8.1(b).

20.95 SUPPLEMENTAL BEFORE-TAX CONTRIBUTIONS. See Section 4.3.

20.96 TRUST AGREEMENT. "Trust Agreement" shall mean one or more trust agreements
     setting forth the duties of the Trustee.

20.97 TRUST FUND.  "Trust Fund" shall mean all assets of the Plan which are held
     by the Trustee in accordance with the Plan and the Trust Agreement.

20.98 TRUSTEE. "Trustee" means one or more corporate  trustees  appointed by the
     Fund  Committee  to execute  the  duties of trustee  set forth in the Trust
     Agreement.

20.99 UNALLOCATED DIVIDENDS. See Section 19.3(k).

20.100 VACATION ACCOUNT. See Section 8.2(b).

20.101 VACATION CONTRIBUTIONS. See Section 6.2.

20.102 VESTING PERCENTAGE. See Section 10.2.

20.103 YEAR OF SERVICE. See Section 2.2(a) and (b).
<PAGE>

                                 SUPPLEMENT 1 TO
                                     TO THE
                      MONSANTO SAVINGS AND INVESTMENT PLAN
                       FOR 1979 SUPPLEMENTAL PARTICIPANTS

A.   SUPPLEMENTAL PARTICIPANT. Effective as of September 30, 1979 (the "TRANSFER
     DATE"),  any  participant  in the  Pharmacia  Plan and any  employee  of an
     affiliate or subsidiary of Pharmacia who had his contributions and interest
     thereon  transferred from the Variable and Extended Benefit portions of the
     Monsanto Company Salaried  Employees'  Pension Plan (1976) ("PENSION PLAN")
     to the  Pharmacia  Plan  became  a  "SUPPLEMENTAL  PARTICIPANT"  under  the
     Pharmacia  Corporation  Savings and Investment  Plan for 1979  Supplemental
     Participants.  Effective as of the Effective Date, each  participant in the
     Plan who had been deemed a Supplemental  Participant  under Supplement 1 to
     the Pharmacia  Plan on the day  immediately  preceding  the Effective  Date
     shall be deemed a "Supplemental  Participant"  hereunder.  Unless otherwise
     expressly  qualified by the context of this supplement,  terms used in this
     Supplement shall have the same meaning given to those terms in the Plan.

B.   SUPPLEMENTAL  SAVINGS  ACCOUNTS  II.  In  addition  to any  other  Accounts
     maintained  under  the  Pharmacia  Plan on his  behalf,  each  Supplemental
     Participant  under the Pharmacia Plan had  established  under the Pharmacia
     Plan  a   Supplemental   Savings   Account  II  to  receive  and  hold  his
     contributions  and interest thereon which were transferred to the Pharmacia
     Plan from the  Variable  Benefit  and/or  Extended  Benefit  portion of the
     Pension  Plan,  if any.  The assets  and  liabilities  attributable  to the
     Supplemental  Savings Account II of any Supplemental  Participant under the
     Pharmacia  Plan who is deemed a  Supplemental  Participant  hereunder  were
     transferred to the Plan effective July 1, 2001.

     The Plan Committee shall maintain a Supplemental Savings Account II as well
     as the income, losses,  appreciation and depreciation  attributable thereto
     in the same  manner as is provided  under  Section 8.1 of the Plan for each
     Supplemental  Participant  under this Supplement 1. No additional funds may
     be deposited by the employee in his Supplemental Savings Account II.

C.   INVESTMENT OF SUPPLEMENTAL SAVINGS ACCOUNT II. Changes in the investment of
     the funds in the Supplemental  Savings Account II shall be made pursuant to
     Section 9.7 of the Plan.

D.   TERMINATION  OF  EMPLOYMENT.  A  Supplemental   Participant's  Supplemental
     Savings Account II shall be fully vested and  non-forfeitable  at all times
     and subject to distribution upon termination of employment  pursuant to the
     terms and conditions of the Plan.

E.   IN-SERVICE WITHDRAWAL

     (1)  A Supplemental  Participant may elect, in the manner prescribed by the
          Plan Committee,  to withdraw one-half or all of his contributions held
          in his Supplemental Savings Account II (but not more than the value of
          his entire  Supplemental  Savings  Account  II,  after all  investment
          losses and  depreciation  thereon have been taken into account)  which
          have not been previously  withdrawn.  Interest and/or earnings on such
          contributions  may not be withdrawn from a Supplemental  Participant's
          Supplemental  Savings  Account  II  until  termination  of  employment
          pursuant  to  Section  10 of the  Plan  or as  provided  in  the  next
          paragraph.

     (2)  Notwithstanding  the  provisions of paragraph 1 of this Section,  if a
          Supplemental  Participant is actually making contributions to the Plan
          and is thus an active  participant in the Plan as of any date on which
          he elects a withdrawal  as provided for in Section 11 of the Plan,  he
          shall also receive  distribution  of the entirety of his  Supplemental
          Savings Account II, including  interest and earnings,  pursuant to the
          terms and conditions of such Section 11.

F.   LOANS. Loans can be made from a participant's  Supplemental Savings Account
     II provided that the participant's  loan request is approved and all of the
     terms, conditions,  requirements and instructions of Section 12 of the Plan
     are met.

     If a participant's  Supplemental  Savings Account II is used as a source of
     loan  funds,  the  participant's  Accounts  shall  be  debited  as  follows
     (pursuant to the provisions of Section 12.10 of the Plan) to satisfy a loan
     request:  Before-Tax Accounts, Direct Rollover Account, After-Tax Accounts,
     and Supplemental Savings Account II, in that order.

<PAGE>

                                  SUPPLEMENT 2
                                     TO THE
                      MONSANTO SAVINGS AND INVESTMENT PLAN
                       FOR 1981 SUPPLEMENTAL PARTICIPANTS

A.   SUPPLEMENTAL  PARTICIPANT.  Effective as of August 31, 1981 (the  "TRANSFER
     DATE"),  any  participant  in the  Pharmacia  Plan and any  employee  of an
     affiliate or subsidiary of Pharmacia who had his contributions and interest
     thereon  transferred  from  the  Monsanto  Company  Hourly-Paid  Employees'
     Pension  Plan  (1976)  ("PENSION  PLAN")  to the  Pharmacia  Plan  became a
     "SUPPLEMENTAL  PARTICIPANT"  under the  Pharmacia  Corporation  Savings and
     Investment  Plan for 1981  Supplemental  Participants.  Effective as of the
     Effective  Date,  each  participant  in the  Plan  who had  been  deemed  a
     Supplemental  Participant  under  Supplement 2 to the Pharmacia Plan on the
     day   immediately   preceding  the   Effective   Date  shall  be  deemed  a
     "Supplemental Participant" hereunder.  Unless otherwise expressly qualified
     by the context of the Supplement,  terms used in this Supplement shall have
     the same meaning given to those terms in the Plan.

B.   SUPPLEMENTAL  SAVINGS  ACCOUNTS  II.  In  addition  to any  other  Accounts
     maintained  under  the  Pharmacia  Plan on his  behalf,  each  Supplemental
     Participant  under the Pharmacia Plan had  established  under the Pharmacia
     Plan  a   Supplemental   Savings   Account  II  to  receive  and  hold  his
     contributions  and interest thereon which were transferred to the Pharmacia
     Plan from the Pension Plan, if any. The assets and liabilities attributable
     to the  Supplemental  Savings  Account II of any  Supplemental  Participant
     under the Pharmacia Plan who is deemed a Supplemental Participant hereunder
     were transferred to the Plan effective July 1, 2001.

     The Plan Committee shall maintain a Supplemental Savings Account II as well
     as the income, losses,  appreciation and depreciation  attributable thereto
     in the same  manner as is provided  under  Section 8.1 of the Plan for each
     Supplemental  Participant  under this Supplement 2. No additional funds may
     be deposited by the employee in his Supplemental Savings Account II.

C.   INVESTMENT OF SUPPLEMENTAL SAVINGS ACCOUNT II. Changes in the investment of
     the funds in the Supplemental  Savings Account II shall be made pursuant to
     Section 9.7 of the Plan.

D.   TERMINATION  OF  EMPLOYMENT.  A  Supplemental   Participant's  Supplemental
     Savings Account II shall be fully vested and  non-forfeitable  at all times
     and subject to distribution upon termination of employment  pursuant to the
     terms and conditions of the Plan.

E.   IN-SERVICE WITHDRAWAL

     (1)  A Supplemental  Participant may elect, in the manner prescribed by the
          Plan Committee,  to withdraw one-half or all of his contributions held
          in his Supplemental Savings Account II (but not more than the value of
          his entire  Supplemental  Savings  Account  II,  after all  investment
          losses and  depreciation  thereon have been taken into account)  which
          have not been previously  withdrawn.  Interest and/or earnings on such
          contributions  may not be withdrawn from a Supplemental  Participant's
          Supplemental  Savings  Account  II  until  termination  of  employment
          pursuant  to  Section  10 of the  Plan  or as  provided  in  the  next
          paragraph.

     (2)  Notwithstanding  the  provisions of paragraph 1 of this Section,  if a
          Supplemental  Participant is actually making contributions to the Plan
          and is thus an active  participant in the Plan as of any date on which
          he elects a withdrawal  as provided for in Section 11 of the Plan,  he
          shall also receive  distribution  of the entirety of his  Supplemental
          Savings Account II, including  interest and earnings,  pursuant to the
          terms and conditions of such Section 11.

F.   LOANS. Loans can be made from a participant's  Supplemental Savings Account
     II provided that the participant's  loan request is approved and all of the
     terms, conditions,  requirements and instructions of Section 12 of the Plan
     are met.

     If a participant's  Supplemental  Savings Account II is used as a source of
     loan  funds,  the  participant's  Accounts  shall  be  debited  as  follows
     (pursuant  to  Section  12.10  of the  Plan)  to  satisfy  a loan  request:
     Before-Tax  Accounts,  Direct Rollover  Account,  After-Tax  Accounts,  and
     Supplemental Savings Account II, in that order.

<PAGE>
                                  SUPPLEMENT 3
                                     TO THE
                      MONSANTO SAVINGS AND INVESTMENT PLAN
                                       FOR
                         U.S. FOREIGN SERVICE EMPLOYEES,
             DESIGNATED NON-U.S. CITIZEN FOREIGN SERVICE EMPLOYEES,
                                       AND
                     INDIVIDUALS ON INTERNATIONAL ASSIGNMENT
                              TO THE UNITED STATES

PURPOSE:
-------

               This  Supplement to the Plan modifies the  provisions of the Plan
               as applied  to  covered  employees.  Unless  otherwise  expressly
               qualified by the context of this  Supplement,  terms used in this
               Supplement  shall have the same  meaning  given to those terms in
               the Plan.

EFFECTIVE DATE:
--------------

This Supplement is effective July 1, 2001.

ELIGIBILITY:
-----------

As used in this  Supplement,  the term "COVERED  EMPLOYEE" means a U.S.  Foreign
Service Employee or a Designated Non-U.S.  Citizen Foreign Service Employee,  as
defined  below.  A person who is not an  employee  of an  Employer  shall not be
eligible to participate in the Plan unless he is either a U.S.  Foreign  Service
Employee or a Designated Non-U.S. Foreign Service Employee.

U.S. FOREIGN SERVICE EMPLOYEES:
------------------------------

A "U.S.  FOREIGN SERVICE EMPLOYEE" is a person employed by a Foreign  Subsidiary
(as defined  below) or a Foreign  Operating  Subsidiary  (as defined  below) who
satisfies all of the following requirements:

     (a)  He is a Citizen or Resident of the United States of America;

     (b)  He is not covered by or  participating  in any funded plan of deferred
          compensation  maintained or otherwise provided by any party other than
          the Company and its  Affiliates  or  Subsidiaries  with respect to the
          remuneration  paid  to him  by  such  Foreign  Subsidiary  or  Foreign
          Operating Subsidiary;

     (c)  If he is an employee of a Foreign Subsidiary,  such Foreign Subsidiary
          and one of the  Employers  has  entered  into an  agreement  with  the
          Secretary of the Treasury or his delegation  under Section  3121(1) of
          the Code; and

     (d)  He is on international assignment from one of the Employers.

Notwithstanding the foregoing, the Plan Committee, or its delegate, may preclude
participation  or  impose  such  terms,  conditions,  and  restrictions  on  the
participation  of a U.S.  Foreign Service  Employee as the Plan Committee or its
delegate,  in the exercise of its sole discretion,  deems necessary or desirable
in order to comply with U.S. or foreign law,  (including  but not limited to tax
reporting and withholding,  securities registration or currency law requirements
imposed by law or treaty) as it affects the U.S. Foreign Service  Employee,  the
Company, any Employer, any Foreign Subsidiary, any Foreign Operating Subsidiary,
the Plan Committee, the Trustee or any agent of any of the foregoing.

DESIGNATED NON-U.S. CITIZEN FOREIGN SERVICE EMPLOYEES:
-----------------------------------------------------

A "Designated Non-U.S. Citizen Foreign Service Employee" is a person employed by
a Subsidiary who satisfies all of the following requirements:

     (a)  He is not a Citizen or Resident of the United States of America;

     (b)  He is not covered by or  participating  in any funded plan of deferred
          compensation  maintained  by or otherwise  provided by any party other
          than the Company and its  Affiliates or  Subsidiaries  with respect to
          the remuneration paid to him by such Subsidiary;

     (c)  He is on international  assignment from an Employer and is employed at
          a location outside the United States, and

     (d)  He has been  designated by the Plan Committee,  or its delegate,  as a
          Designated Non-U.S. Citizen Foreign Service Employee.

Notwithstanding  the foregoing,  the Plan Committee or its delegate may preclude
participation  or  impose  such  terms,  conditions,  and  restrictions  on  the
participation of a Designated  Non-U.S.  Citizen Foreign Service Employee as the
Plan Committee,  or its delegate, in the exercise of its sole discretion,  deems
necessary or  desirable  in order to comply with U.S. or foreign law  (including
but not limited to tax  reporting and  withholding  securities  registration  or
currency law requirements imposed by law or treaty) as it affects the Designated
Non-U.S.  Citizen  Foreign  Service  Employee,  the Company,  any Employer,  any
Subsidiary,  the  Plan  Committee,  the  Trustee  or  any  agent  of  any of the
foregoing.

INDIVIDUALS ON INTERNATIONAL ASSIGNMENT TO THE UNITED STATES:
------------------------------------------------------------

An  "INDIVIDUAL  ON  INTERNATIONAL  ASSIGNMENT"  is a  person  on  international
assignment  from a Foreign  Subsidiary (as defined below),  a Foreign  Operating
Subsidiary  (as defined  below),  a Subsidiary or the foreign  operations of the
Company or any Affiliate or Subsidiary to the domestic operations of the Company
or one of the other Employers.  An Individual on International  Assignment shall
not be  eligible  to  participate  in the Plan;  PROVIDED,  HOWEVER,  that if an
Individual on  International  Assignment was a participant in the Pharmacia Plan
on August 31, 1983, such individual shall be eligible to participate  under this
Plan until he no longer is an Individual on International Assignment;  provided,
however, that the terms and conditions of such individual's  participation shall
be governed by the  provisions of the Pharmacia  Plan (as Conformed and Restated
as of January 1, 1981).

FOREIGN OPERATING SUBSIDIARY:
----------------------------

A  "FOREIGN  OPERATING  SUBSIDIARY"  means a  domestic  corporation  which  is a
Subsidiary and which satisfies the following requirements:

     (a)  80  percent  or more of its  outstanding  voting  stock is owned by an
          Employer; and

     (b)  Except as provided  below,  as of the close of its taxable  year which
          ends on or before  the  close of the most  recent  Fiscal  Year of the
          Employer  described in  paragraph  (a) above 95 percent or more of its
          gross income for the immediately  preceding  three-year period (or for
          the entire immediately preceding period of its existence if it has not
          been in  existence  for three years as of such date) was derived  from
          sources  without the United States of America  (determined by the Plan
          Committee in a manner  consistent with Sections 861 through 864 of the
          Code); and

     (c)  Except as provided  below,  90 percent or more of its gross income for
          the period  described  in  paragraph  (b) above was  derived  from the
          active conduct of a trade or business.

If, for the period described in paragraph (b) above such Subsidiary had no gross
income, the provisions of paragraphs (b) and (c) above shall be considered to be
satisfied if the Plan Committee  determines  that it is reasonable to anticipate
that such  provisions will be satisfied with respect to the period ending on the
close of the first taxable year of such Subsidiary  ending after the last day of
the period described in paragraph (b) above.

FOREIGN SUBSIDIARY:
------------------

A "Foreign Subsidiary" means a foreign corporation or entity in which one of the
Employers  owns  (directly  or through  one or more  entities)  not less than 10
percent of the voting stock,  in the case of a corporation,  or not less than 10
percent of the profits, in the case of any other entity.

RESIDENT:
--------

A "Resident of the United States" means a resident as defined in Section 7701(b)
of the Code.

ELIGIBLE EARNINGS:
-----------------

In the case of a U.S. Foreign Service Employee,  a Designated  Non-U.S.  Citizen
Foreign  Service  Employee,  or  an  Individual  on  International   Assignment,
"Eligible  Earnings" as defined in Section 5.5 of the Plan and in Section 4.4 of
the Plan (as  Conformed  and Restated as of January 1, 1981) shall mean base pay
without adjustments.

<PAGE>
                                  SUPPLEMENT 4
                                     TO THE
                      MONSANTO SAVINGS AND INVESTMENT PLAN
                FOR THE FOLLOWING EMPLOYEES AND FORMER EMPLOYEES:

            PARTICIPANTS IN THE NUTRASWEET CAPITAL ACCUMULATION PLAN
                              ON DECEMBER 31, 1996

PURPOSE:

This  Supplement to the Plan  modifies the  provisions of the Plan as applied to
Covered Employees.  Unless otherwise  expressly qualified by the context of this
Supplement,  terms used in this Supplement shall have the same meanings given to
those  terms in the Plan.  To the extent  there are any  conflicts  between  the
provisions of the Plan and this  Supplement,  the provisions of this  Supplement
will govern.

EFFECTIVE DATE:

The Effective  Date of this  Supplement for Covered  Employees  shall be July 1,
2001.

COVERED EMPLOYEE:

A Covered  Employee is any employee of an Employer who was a participant  in the
NutraSweet CAP on or before December 31, 1996 and who became a participant under
Annex A of the Pharmacia Plan as in effect on January 1, 1997.

ELIGIBILITY:

A Covered Employee shall become a participant under the Plan as of the Effective
Date.

INVESTMENT OF EMPLOYER CONTRIBUTIONS:

A Covered  Employee  may elect (in whole  percentages)  to invest  his  Employer
Matching  Account as of December 31, 1996 in one or more of the Investment Funds
and/or  Pre-Mixed  Portfolios.  A Covered  Employee  may elect to transfer  such
amounts among the Investment  Funds and/or  Pre-Mixed  Portfolios as provided in
Section 9.7.

<PAGE>
                                  SUPPLEMENT 5
                                     TO THE
                      MONSANTO SAVINGS AND INVESTMENT PLAN
                FOR THE FOLLOWING EMPLOYEES AND FORMER EMPLOYEES:

              PARTICIPANTS IN THE SEARLE CAPITAL ACCUMULATION PLAN
                              ON DECEMBER 31, 1996

PURPOSE:

This  Supplement to the Plan  modifies the  provisions of the Plan as applied to
Covered Employees.  Unless otherwise  expressly qualified by the context of this
Supplement,  terms used in this Supplement shall have the same meanings given to
those  terms in the Plan.  To the extent  there are any  conflicts  between  the
provisions of the Plan and this  Supplement,  the provisions of this  Supplement
will govern.

EFFECTIVE DATE:

The Effective  Date of this  Supplement for Covered  Employees  shall be July 1,
2001.

COVERED EMPLOYEE:

A Covered  Employee is any employee of an Employer who was a participant  in the
Searle CAP on or before  December  31, 1996 and who became a  participant  under
Annex A of the Pharmacia Plan as in effect on January 1, 1997.

ELIGIBILITY:

A Covered Employee shall become a participant under the Plan as of the Effective
Date.

INVESTMENT OF EMPLOYER CONTRIBUTIONS:

A Covered  Employee  may elect (in whole  percentages)  to invest  his  Employer
Matching  Account as of December 31, 1996 in one or more of the Investment Funds
and/or  Pre-Mixed  Portfolios.  A Covered  Employee  may elect to transfer  such
amounts among the Investment  Funds and/or  Pre-Mixed  Portfolios as provided in
Section 9.7.

<PAGE>

                                  SUPPLEMENT 6
                                     TO THE
                      MONSANTO SAVINGS AND INVESTMENT PLAN

                     HARTZ, HYBRITECH AND CALGENE EMPLOYEES

PURPOSE:

This  Supplement to the Plan  modifies the  provisions of the Plan as applied to
Covered Employees.  Unless otherwise  expressly  qualified by the context of the
Supplement,  terms used in this  Supplement  shall have the same  meaning  given
those  terms in the Plan.  To the extent  there are any  conflicts  between  the
provisions of the Plan and this  Supplement,  the provisions of this  Supplement
will govern.

EFFECTIVE DATE:

The Effective  Date of this  Supplement  for Covered  Employees is July 1, 2001.
Pharmacia,  prior to November 1, 1998,  maintained the following separate 401(k)
defined contribution plans for the benefit of eligible employees: Retirement and
Savings  Plan for  Employees  of Jacob  Hartz  Seed Co.,  Inc.  ("HARTZ  PLAN"),
Retirement and Savings Plan for Employees of Hybritech Seed International,  Inc.
("HYBRITECH  PLAN") and Calgene,  Inc.  Savings and  Protection  Plan  ("CALGENE
PLAN") (collectively the plans shall hereinafter be referred to as the "ACQUIRED
PLANS").  Effective  November 1, 1998,  the Acquired  Plans were merged into the
Pharmacia Plan and,  pursuant to such mergers,  all assets of the Acquired Plans
became  assets  of the  Pharmacia  Plan,  and the  Pharmacia  Plan  assumed  the
liabilities of the Acquired Plans.

Effective July 1, 2001, the assets and liabilities  attributable to the accounts
of Covered Employees were transferred to the Plan.

ELIGIBILITY:

As used in this  Supplement,  the term  "Covered  Employee"  means an individual
whose  accounts  in  the  Hartz  Plan,  Hybritech  Plan  or  Calgene  Plan  were
transferred to the Pharmacia Plan effective  November 1, 1998 and whose Accounts
were transferred to the Plan as of July 1, 2001. A Covered Employee shall become
a participant in the Plan as of July 1, 2001.

YEARS OF SERVICE:

A Covered  Employee's  Years of Service shall include such  employee's  Years of
Service under the Hartz Plan,  Hybritech  Plan or Calgene Plan prior to becoming
eligible under Section 2.1 of the Pharmacia Plan. Notwithstanding the foregoing,
in no event  shall a Covered  Employee's  Years of Service  under the  foregoing
sentence be credited  again to the extent the service  already has been credited
under Section 2.2 of the Plan.

DISTRIBUTION OPTIONS:

     (a)  The  normal  form of  benefit  shall  be a lump  sum  distribution  as
          described  in  Section  10.5(a)  of  the  Plan.  In  addition  to  the
          distribution  options  provided  under  Section  10.5 of the  Plan,  a
          Covered  Employee  may elect to  receive  the  portion  of his  vested
          Accounts transferred from an Acquired Plan ("transferred  benefit") in
          the form of a purchased  immediate  non-transferable  annuity contract
          providing for an annuity payable for a period not extending beyond the
          life (or life  expectancy) of the Covered  Employee or the joint lives
          (or life  expectancies  of the  Covered  Employee  and his  contingent
          annuitant).  The notice provided to the Covered  Employee  pursuant to
          Section 10.5(f) of the Plan will include:

          o    the material  features  and the  relative  values of the optional
               forms of benefits under the Plan,

          o    the terms and  conditions of the annuity form of benefits and the
               financial effect upon the Covered  Employee's benefit in terms of
               dollars per benefit payment,

          o    the  Covered  Employee's  right to make,  and the  effect  of, an
               election to waive the annuity form of benefit,

          o    in the case of a  married  Covered  Employee,  the  rights of the
               Covered Employee's spouse with respect to any such election,

          o    the rights of the Covered  Employee to make, and the effect of, a
               revocation  of any  such  election  before  the  commencement  of
               benefits, and

          o    the right, if any, of the Covered  Employee to defer receipt of a
               distribution.

               An  election  made  under  this  paragraph  (a) may be changed or
               revoked  without  limitation  if the  Covered  Employee  files  a
               written  request  before the date as of which his annuity form of
               benefits are to commence.  A married Covered  Employee who wishes
               to change his form of  benefit to a benefit  other than the joint
               and 50% or 100% survivor  benefit must secure the written consent
               of his spouse and such  consent  must  acknowledge  the effect of
               such election and be witnessed by a notary  public.  If a married
               Covered  Employee dies before his benefits  commence,  his vested
               transferred  benefit will be distributed to his surviving  spouse
               unless his surviving  spouse  consented to the  designation of an
               alternate  beneficiary  in  accordance  with  Section 10.6 of the
               Plan. Distribution to his surviving spouse will be made in a lump
               sum,   unless  such  surviving   spouse  elects  to  receive  the
               transferred  benefit  in the  form  of a  survivor  annuity.  The
               survivor annuity shall be a purchased immediate  non-transferable
               annuity contract providing for an annuity payable for the life of
               the surviving spouse.

     (b)  If a Covered  Employee is married when he elects to receive an annuity
          contract,  the annuity  contract shall be a joint and survivor annuity
          designating  his  spouse  as  the  50%  (or  100%,  if he  so  elects)
          contingent  annuitant  unless the Covered  Employee elects a different
          annuity  form and his  spouse has  consented  to such  election.  Such
          consent must  acknowledge the effect of such election and be witnessed
          by a notary public.

INVESTMENT ELECTIONS:

A Covered  Employee may elect to change his investment  elections as provided in
Sections 9.4 and 9.7.

INVESTMENT OF EMPLOYER CONTRIBUTIONS:

A Covered Employee may elect (in whole percentages) to invest the portion of his
Employer  Matching Account  attributable to employer  contributions  transferred
from  an  Acquired  Plan  in one  or  more  Investment  Funds  and/or  Pre-Mixed
Portfolios.  A  Covered  Employee  may  elect to  transfer  such  amounts  among
Investment Funds and/or Pre-Mixed Portfolios as provided in Section 9.7.

<PAGE>
                                  SUPPLEMENT 7
                                     TO THE
                      MONSANTO SAVINGS AND INVESTMENT PLAN

                                DEKALB EMPLOYEES
                                ----------------

PURPOSE:

This  Supplement to the Plan  modifies the  provisions of the Plan as applied to
Covered Employees.  Unless otherwise  expressly  qualified by the context of the
Supplement,  terms used in this  Supplement  shall have the same  meaning  given
those  terms in the Plan.  To the extent  there are any  conflicts  between  the
provisions of the Plan and this  Supplement,  the provisions of this  Supplement
will govern.

EFFECTIVE DATE:

The Effective  Date of this  Supplement  for Covered  Employees is July 1, 2001.
Prior to July 1, 2000, DEKALB Genetics Corporation, maintained a separate 401(k)
defined  contribution plan known as the DEKALB Genetics  Corporation Savings and
Investment Plan ("DEKALB Plan") for the benefit of eligible employees. Effective
July 1, 2000, the DEKALB Plan was merged into the Pharmacia  Plan and,  pursuant
to such  merger,  all assets of the DEKALB Plan became  assets of the  Pharmacia
Plan,  and the  Pharmacia  Plan  assumed  the  liabilities  of the DEKALB  Plan.
Effective July 1, 2001, the assets and liabilities  attributable to the accounts
of Covered Employees were transferred to the Plan.

ELIGIBILITY:

As used in this  Supplement,  the term  "Covered  Employee"  means an individual
whose  accounts  in the  DEKALB  Plan were  transferred  to the  Pharmacia  Plan
effective July 1, 2000 and whose accounts were transferred to the Plan effective
as of July 1, 2001. A Covered Employee shall become a participant in the Plan as
of July 1, 2001.

YEARS OF SERVICE:

A Covered  Employee's  Years of Service shall include such  employee's  Years of
Service  under the DEKALB Plan prior to becoming  eligible  under Section 2.1 of
the Plan.  Notwithstanding the foregoing, in no event shall a Covered Employee's
Years of Service  under the foregoing  sentence be credited  again to the extent
the service already has been credited to such Covered Employee under Section 2.2
of the Plan.

INVESTMENT ELECTIONS:

A Covered Employee may elect to change his investment  elections with respect to
his account  balances  transferred  from the DEKALB Plan as provided in Sections
9.4 and 9.7.

INVESTMENT OF EMPLOYER CONTRIBUTIONS:

A Covered Employee may elect (in whole percentages) to invest the portion of his
Employer  Matching Account  attributable to employer  contributions  transferred
from  the  DEKALB  Plan  in  one  or  more  Investment  Funds  and/or  Pre-Mixed
Portfolios.  A  Covered  Employee  may  elect to  transfer  such  amounts  among
Investment Funds and/or Pre-Mixed Portfolios as provided in Section 9.7.

IN-SERVICE WITHDRAWALS:

Notwithstanding  anything  contained herein to the contrary,  a Covered Employee
may elect,  at any time,  to  withdraw  any amounts  transferred  from a Covered
Employee's  "Supplemental  Participant  Contribution  Account" and/or  "Rollover
Account" which were previously  maintained in the DEKALB Plan. Such request must
be made in the manner prescribed by the Plan Committee.

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